EXHIBIT 4.2
CREDIT AGREEMENT
This Agreement, dated as of December 21, 2004, is among Tecumseh Products
Company, a Michigan corporation, the Lenders and JPMorgan Chase Bank, N.A., a
national banking association, as Agent. The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Accumulated Funding Deficiency" means any accumulated funding deficiency
within the meaning of Section 412 of the Code or Section 302 of ERISA.
"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 limited liability company, 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 Voting Stock of any Person.
"Administrative Questionnaire" means an administrative questionnaire in a
form supplied to Lenders by the Agent.
"Advance" means a borrowing hereunder, (i) made by some or all of 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. The term "Advance" shall
include Swing Line Loans unless otherwise expressly provided.
"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 5% 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 JPMCB 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.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced from time to time pursuant to the terms hereof. As of the
date hereof, the Aggregate Commitment equals $100,000,000.
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"Aggregate Outstanding Credit Exposure" means, at any time, the aggregate
of the Outstanding Credit Exposure of all the Lenders.
"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.
"Applicable Facility Fee Rate" means, at any time, the percentage rate per
annum at which facility fees under Section 2.6(i) are accruing at such time as
set forth in the Pricing Schedule.
"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.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arranger" means X.X. Xxxxxx Securities, Inc., and its successors, in its
capacity as Lead Arranger and Sole Book Runner.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the president, chief executive officer or
chief financial officer of the Borrower or any other employee of the Borrower
designated in writing as an Authorized Officer by any of the foregoing, in each
case acting singly.
"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Board of Directors" means: (i)with respect to a corporation, the board of
directors of the corporation; (ii) with respect to a partnership, the Board of
Directors of the general partner of the partnership; and (iii) with respect to
any other Person, the board or committee of such Person serving a similar
function.
"Borrower" means Tecumseh Products Company, a Michigan corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.9.
"Brazil" means the Federative Republic of Brazil.
"Brazilian Subsidiary" means any Subsidiary of the Borrower organized under
the laws of Brazil.
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"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 Detroit and New York City 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 Detroit for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.
"Capital Stock" means (i) in the case of any corporation, all capital stock
and any securities exchangeable for or convertible into capital stock and any
warrants, rights or other options to purchase or otherwise acquire capital stock
or such securities or any other form of equity securities, (ii) in the case of
an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, (iii) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (iv) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"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.
"Cash Equivalent Investments" means (i) short-term obligations of, or fully
guaranteed by, the United States of America, (ii) commercial paper rated A-1 or
better by S&P or P-1 or better by Moody's or has an equivalent rating from a
nationally recognized investment rating company, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided in each case that
the same provides for payment of both principal and interest (and not principal
alone or interest alone) and is not subject to any contingency regarding the
payment of principal or interest.
"Change in Control" means (i) the acquisition by any Person (other than
Permitted Holders), or two or more Persons (other than Permitted Holders) acting
in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
20% or more of the outstanding shares of Voting Stock of the Borrower; or (ii) a
majority of the members of the Board of Directors of the Borrower shall not be
Continuing Directors.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral Shortfall Amount" is defined in Section 8.1.
"Commitment" means, for each Lender, the obligation of such Lender to make
Revolving Loans to, and participate in Swing Line Loans and Facility LCs issued
upon the application of, the Borrower in an aggregate amount not exceeding the
amount set forth opposite its signature below or as set forth in any Notice of
Assignment relating to any assignment that has become effective pursuant to
Section 12.3.3, as
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such amount may be modified from time to time pursuant to the terms hereof.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income and without
duplication (i) Consolidated Interest Expense, (ii) expense for accrued income
taxes, (iii) depreciation, (iv) amortization, (v) extraordinary losses incurred
other than in the ordinary course of business, and (vi) non-cash charges related
specifically to any goodwill impairment charge required under FASB 142 not to
exceed $25,000,000 in the aggregate after the date of this Agreement, minus, to
the extent included in Consolidated Net Income, extraordinary gains realized
other than in the ordinary course of business, all calculated for the Borrower
and its Subsidiaries on a consolidated basis.
"Consolidated EBITDAR" means Consolidated EBITDA plus, to the extent
deducted from revenues in determining Consolidated EBIT and without duplication,
Consolidated Rents, all calculated for the Borrower and its Subsidiaries on a
consolidated basis.
"Consolidated Indebtedness" means at any time the Indebtedness of the
Borrower and its Subsidiaries calculated on a consolidated basis as of such
time.
"Consolidated Interest Expense" means, with reference to any period, the
interest expense of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period, including without limitation all financing
costs in connection with a Qualified Receivables Transaction.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Worth" means at any time the consolidated stockholders'
equity of the Borrower and its Subsidiaries calculated on a consolidated basis
as of such time; provided that all accumulated other comprehensive income (as
determined in accordance with Agreement Accounting Principles, which includes
such non-cash adjustments for foreign currency translation and transaction
adjustments, net unrealized gains/losses on all investments, minimum pension
liability and other FASB 87 adjustments, and all FASB 133 related adjustments)
shall be excluded in determining Consolidated Net Worth.
"Consolidated Rents" means, with reference to any period, the aggregate
amounts payable by the Borrower and its Subsidiaries for such period under any
Operating Lease, calculated on a consolidated basis for such period.
"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 contract or the obligations of any such Person as general
partner of a partnership with respect to the liabilities of the partnership.
"Continuing Directors" means, as of any date, individuals who at the
beginning of any period of two consecutive calendar years ended before such date
constituted the Board of Directors of the Borrower, together with any new
directors whose election by such Board of Directors or whose nomination for
election was approved by a vote of at least two-thirds of the members of such
Board of Directors then still in
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office who either were members of such Board of Directors at the beginning of
such period or whose election or nomination for election was previously so
approved.
"Conversion/Continuation Notice" is defined in Section 2.10.
"Controlled Group" means all members of a controlled group of corporations
or other business entities 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.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC hereunder.
"Credit Extension Date" means the Borrowing Date for an Advance or the
issuance date for a Facility LC.
"Default" means an event described in Article VII.
"Defaulting Lender" means any Lender that on any Borrowing Date fails to
make available to the Agent such Lender's Loans required to be made to the
Borrower on such Borrowing Date or fails to make any payment due to the Agent as
and when due hereunder. Once a Lender becomes a Defaulting Lender, such Lender
shall continue as a Defaulting Lender until such time as such Defaulting Lender
makes available to the Agent the amount of such Defaulting Lender's Loans
together with all other amounts required to be paid to the Agent and/or the
Lenders pursuant to this Agreement.
"Domestic Subsidiary" means each present and future Subsidiary of the
Borrower which is not a Foreign Subsidiary.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to (i) the
protection of the environment, (ii) the effect of the environment on human
health, (iii) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land, or (iv)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.
"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 2.12, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the rate appearing on Page 3750 of the Dow Xxxxx
Market Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Agent from time to time for purposes of providing quotations
of interest rates applicable to dollar deposits in the London interbank market)
at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity
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comparable to such Interest Period. In the event that such rate is not available
at such time for any reason, then the "Eurodollar Base Rate" with respect to
such Eurodollar Advance for such Interest Period shall be the rate at which U.S.
dollar deposits of $5,000,000 and for a maturity comparable to such Interest
Period are offered by the principal London office of the Agent in immediately
available funds in the London interbank market at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.12, 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 (including
the Michigan single business tax), and franchise taxes imposed on it, by (i) 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.
"Facility LC" is defined in Section 2.19.1.
"Facility LC Application" is defined in Section 2.19.3.
"Facility LC Collateral Account" is defined in Section 2.19.11.
"Facility Termination Date" means the earlier of (i) the date five years
after the date of this Agreement or (ii) the 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.
"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any Rate Management
Transaction.
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"Fixed Charge Coverage Ratio" means, as of the end of each fiscal quarter
of the Borrower as calculated for the four consecutive fiscal quarters then
ending, the ratio of (i) Consolidated EBITDAR to (ii) Consolidated Interest
Expense plus Consolidated Rents.
"Floating 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.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.12, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided in
Section 2.12, bears interest at the Floating Rate.
"Foreign Subsidiary" means each Subsidiary organized under the laws of a
jurisdiction outside of the United States.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Governmental Authorization" means any permit, license, authorization,
plan, directive, consent order or consent decree of or from any federal, state
or local governmental authority, agency or court or any foreign governmental
authority, agency or court.
"Guarantor" means all present and future Domestic Subsidiaries of the
Borrower and their successors and assigns, and any other Person executing a
Guaranty at any time; provided that (i) Xxxxxx Property Company, LLC, a
Wisconsin limited liability company, shall not be required to be a Guarantor so
long as it has no assets other than the existing real estate in Wisconsin owned
as of the date hereof as described by the Borrower and has no business or
material net worth, and (ii) each of The Lauson Company, a Wisconsin
corporation, Power Products Company, Inc., a Wisconsin corporation, Providence
Controls Company, a Rhode Island corporation, and Tecumseh Technologies, Inc., a
Delaware corporation, shall not be required to be a Guarantor so long as it has
no assets or business.
"Guaranty" means all guaranties of the Obligations executed by the
Guarantors in favor of the Agent, for the ratable benefit of the Lenders, as it
may be amended or modified and in effect from time to time, and each such
guaranty shall be in form and substance acceptable to the Agent.
"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (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 other instruments, (v)
obligations of such Person to purchase securities or other Property arising out
of or in connection with the sale of the same or substantially similar
securities or Property, (vi) obligations of such Person with respect to Letters
of Credit, whether drawn or undrawn, contingent or otherwise, (vii) Net
Xxxx-to-Market Exposure, (viii) Off-Balance Sheet Liabilities, (ix) Capitalized
Lease Obligations, (x) Receivables Transaction Attributed Indebtedness, (xi) any
other obligation for borrowed money or other financial accommodation which in
accordance with Agreement
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Accounting Principles would be shown as a liability on the consolidated balance
sheet of such Person, and (xii) all Contingent Obligations of such Person with
respect to any of the foregoing.
"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) or
contribution of capital by such Person; stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; any
deposit accounts and certificate of deposit owned by such Person; and structured
notes, derivative financial instruments and other similar instruments or
contracts owned by such Person.
"JPMCB" means JPMorgan Chase Bank, N.A., a national banking association, in
its individual capacity, and its successors.
"LC Fee" is defined in Section 2.19.4.
"LC Issuer" means JPMCB (or any subsidiary or affiliate of JPMCB designated
by JPMCB) in its capacity as issuer of Facility LCs hereunder.
"LC Obligations" means, at any time, the sum, without duplication, of (i)
the aggregate undrawn stated amount under all Facility LCs outstanding at such
time plus (ii) the aggregate unpaid amount at such time of all Reimbursement
Obligations.
"LC Payment Date" is defined in Section 2.19.5.
"Lender Addition and Acknowledgement Agreement" means an agreement in
substantially the form of Exhibit A hereto, with such changes thereto as
approved by the Agent.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and their respective successors and assigns. Unless otherwise
specified, the term "Lenders" includes JPMCB in its capacity as Swing Line
Lender.
"Lending Installation" means, with respect to a Lender, the Agent or LC
Issuer, the office, branch, subsidiary or affiliate of such Lender, the Agent or
LC Issuer listed on the signature pages hereof or on a Schedule or otherwise
selected by such Lender, the Agent or LC Issuer pursuant to Section 2.18
"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.
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"Leverage Ratio" means, as of any date of calculation, the ratio of (i)
Consolidated Indebtedness outstanding on such date to (ii) Consolidated EBITDA
for the Borrower's then most-recently ended four fiscal quarters.
"Lien" means any lien (statutory or other), 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).
"Loan Documents" means this Agreement, the Guaranties, the Facility LC
Applications, any Notes issued pursuant to Section 2.14 and any other agreements
or instruments executed in connection herewith at any time.
"Loan" means a Revolving Loan or a Swing Line Loan.
"Margin Stock" means "margin stock" as defined in Regulations U or X or
"marginable OTC stock" or "foreign margin stock" within the meaning of
Regulation T.
"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 and the Guarantors taken as a whole to perform their
respective 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, the LC Issuer or the Lenders thereunder.
"Material Indebtedness" means Indebtedness in an outstanding principal
amount of $25,000,000 or more in the aggregate (or the equivalent thereof in any
currency other than U.S. dollars).
"Material Indebtedness Agreement" means any agreement under which any
Material Indebtedness was created or is governed or which provides for the
incurrence of Indebtedness in an amount which would constitute Material
Indebtedness (whether or not an amount of Indebtedness constituting Material
Indebtedness is outstanding thereunder).
"Modify" and "Modification" are defined in Section 2.19.1.
"Moody's" means Xxxxx'x Investors Service, Inc.
"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.
"Net Cash Proceeds" means, in connection with any issuance or sale of any
equity securities or debt securities or instruments or the incurrence of loans,
the cash proceeds received from such issuance or incurrence, net of investment
banking fees, reasonable and documented attorneys' fees, accountants' fees,
underwriting discounts and commissions and other reasonable and customary fees
and expenses actually incurred in connection therewith.
"Net Xxxx-to-Market Exposure" of a Person means, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Rate Management
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Transactions. "Unrealized losses" means the fair market value of the cost to
such Person of replacing such Rate Management Transaction as of the date of
determination (assuming the Rate Management Transaction were to be terminated as
of that date), and "unrealized profits" means the fair market value of the gain
to such Person of replacing such Rate Management Transaction as of the date of
determination (assuming such Rate Management Transaction were to be terminated
as of that date).
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" is defined in Section 2.14.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Loans, all Reimbursement Obligations, 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, the LC Issuer or any indemnified party
arising under the Loan Documents.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called "synthetic lease" or "tax ownership operating lease" transaction
entered into by such Person, or (iv) any obligation arising with respect to any
other transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheets of
such Person, but excluding from this clause (iv) Operating Leases.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Other Taxes" is defined in Section 3.5(ii).
"Outstanding Credit Exposure" means, as to any Lender at any time, the sum
of (i) the aggregate principal amount of its Revolving Loans outstanding at such
time, plus (ii) an amount equal to its Pro Rata Share of the LC Obligations and
the aggregate principal amount of Swing Line Loans outstanding at such time.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the date three months after the date hereof and each
date occurring each three months thereafter.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Holders" means and includes (A) any Person who is a lineal
descendant of Xxxxxxx Xxxxxxx, (B) the spouse, children, or grandchildren of any
such Person, (C) any trust of which any of such Persons is a trustee or a
beneficiary, (D) the estate, executor, administrator, or any legal guardian of
any such Person, (E) any partnership, corporation or limited liability company
owned and controlled solely by such Persons and (F) the Xxxxxxx Foundation.
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"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.
"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 JPMCB or its parent (which is not necessarily the
lowest rate charged to any customer), changing when and as said prime rate
changes.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"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.
"Qualified Receivables Transaction" means any transaction or series of
transactions that may be entered into by the Borrower or any Subsidiary pursuant
to which the Borrower or any Subsidiary may sell, convey or otherwise transfer
to a newly-formed Subsidiary or other special-purpose entity, or any other
Person, any accounts or notes receivable and rights related thereto, provided
that (i) all of the terms and conditions of such transaction or series of
transactions, including without limitation the amount and type of any recourse
to the Borrower or any Subsidiary with respect to the assets transferred, are
acceptable to the Agent and the Required Lenders and (ii) the Receivables
Transaction Attributed Indebtedness incurred in such transaction or series of
transactions does not exceed $100,000,000.
"Rate Management Transaction" means any transaction (including an agreement
with respect thereto) now existing or hereafter entered by the Borrower which is
a rate swap, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions) or
any combination thereof, whether linked to one or more interest rates, foreign
currencies, commodity prices, equity prices or other financial measures.
"Rate Management Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
"Receivables Transaction Attributed Indebtedness" means the amount of
obligations outstanding under the legal documents entered into as part of any
Qualified Receivables Transaction on any date of determination that would be
characterized as principal if such Qualified Receivables Transaction were
11
structured as a secured lending transaction rather than as a purchase.
"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 T" means Regulation T 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.
"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.
"Regulation X" means Regulation X 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.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.19 to reimburse the
LC Issuer for amounts paid by the LC Issuer in respect of any one or more
drawings under Facility LCs.
"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 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.
"Reports" is defined in Section 9.6.
"Required Lenders" means Lenders in the aggregate having more than 50% of
the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding more than 50% of the Aggregate Outstanding
Credit Exposure.
"Requirement of Law" means as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other governmental authority (foreign or domestic), in
each case applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"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 Loan" means, with respect to a Lender, such Lender's loan made
pursuant to its
12
commitment to lend set forth in Section 2.1 (or any conversion or continuation
thereof).
"S&P" means Standard and Poor's Ratings Services, a division of The McGraw
Hill Companies, Inc.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
"SEC Reports" means the following reports and financial statements of the
Borrower:
(i) the Borrower's annual report on Form 10-K for the year ended
December 31, 2003, as filed with or sent to the Securities and Exchange
Commission as of the date hereof; and
(ii) the Borrower's quarterly reports on Form 10-Q for the quarters
ended March 31, 2004, June 30, 2004 and September 30, 2004, the definitive proxy
statement for the 2004 annual shareholders meeting of the Borrower and all Form
8-K's filed after December 31, 2003, in each case as filed with the Securities
and Exchange Commission as of the date hereof.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Significant Subsidiary" means any one or more Subsidiaries which, if
considered in the aggregate as a single Subsidiary, would be a "significant
subsidiary" as defined in Rule 1-02 of Regulation S-X under the Securities
Exchange Act of 1934.
"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, limited liability company, association, joint venture 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. For purposes of the representations and
warranties made herein, each reference to a "Subsidiary" of the Borrower shall
include the Target and its Subsidiaries.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries or property which is
responsible for more than 10% of the consolidated net sales or of the
consolidated net income of the Borrower and its Subsidiaries, in each case, 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 if financial statements have not
been delivered hereunder for that month which begins the twelve-month period,
then the financial statements delivered hereunder for the quarter ending
immediately prior to that month).
13
"Swing Line Borrowing Notice" is defined in Section 2.5.2.
"Swing Line Commitment" means the obligation of the Swing Line Lender to
make Swing Line Loans up to a maximum principal amount of $15,000,000 at any one
time outstanding.
"Swing Line Lender" means JPMCB or such other Lender which may succeed to
its rights and obligations as Swing Line Lender pursuant to the terms of this
Agreement.
"Swing Line Loan" means a Loan made available to the Borrower by the Swing
Line Lender pursuant to Section 2.5.
"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.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance and with respect to any Loan, its nature as a
Floating Rate Loan or a Eurodollar Loan.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested and unvested accrued 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 using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Voting Stock" of a Person means all classes of Capital Stock of such
Person then outstanding and normally entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers, trustees or
similar persons thereof.
"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, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
14
ARTICLE II
THE CREDITS
2.1. Commitment. From and including the date of this Agreement and prior to
the Facility Termination Date, each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to (i) make Revolving Loans to the
Borrower and (ii) participate in Swing Line Loans and Facility LCs issued upon
the request of the Borrower, provided that, after giving effect to the making of
each such Loan and the issuance of each such Facility LC, such Lender's
Outstanding Credit Exposure shall not exceed its Commitment, provided, further,
that at no time shall the aggregate principal amount of the Loans and Facility
LC's outstanding hereunder exceed the Aggregate Commitment. Subject to the terms
of this Agreement, the Borrower may borrow, repay and reborrow at any time prior
to the Facility Termination Date. The Commitments to extend credit hereunder
shall expire on the Facility Termination Date. The LC Issuer will issue Facility
LCs hereunder on the terms and conditions set forth in Section 2.19.
2.2. Required Payments; Termination. Unless earlier payment is required
hereunder, the Loans and all other unpaid Obligations shall be paid in full by
the Borrower on the Facility Termination Date.
2.3. Ratable Loans. Each Advance hereunder (other than any Swing Line Loan)
shall consist of Revolving 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 2.9 and 2.10, or Swing Line Loans selected by the
Borrower in accordance with Section 2.5.
2.5. Swing Line Loans.
2.5.1. Amount of Swing Line Loans. Upon the satisfaction of the
conditions precedent set forth in Section 4.2 and, if such Swing Line Loan
is to be made on the date of the initial Advance hereunder, the
satisfaction of the conditions precedent set forth in Section 4.1 as well,
from and including the date of this Agreement and prior to the Facility
Termination Date, the Swing Line Lender agrees, on the terms and conditions
set forth in this Agreement, to make Swing Line Loans to the Borrower from
time to time in an aggregate principal amount not to exceed the Swing Line
Commitment, provided that the Aggregate Outstanding Credit Exposure shall
not at any time exceed the Aggregate Commitment, and provided further that
at no time shall the sum of (i) the Swing Line Lender's Pro Rata Share of
the Swing Line Loans, plus (ii) the outstanding Revolving Loans made by the
Swing Line Lender pursuant to Section 2.1, exceed the Swing Line Lender's
Commitment at such time. Subject to the terms of this Agreement, the
Borrower may borrow, repay and reborrow Swing Line Loans at any time prior
to the Facility Termination Date.
2.5.2. Borrowing Notice. The Borrower shall deliver to the Agent and
the Swing Line Lender irrevocable notice (a "Swing Line Borrowing Notice")
not later than noon (Chicago time) on the Borrowing Date of each Swing Line
Loan, specifying (i) the applicable Borrowing Date (which date shall be a
Business Day), and (ii) the aggregate amount of the requested Swing Line
15
Loan which shall be an amount not less than $100,000. The Swing Line Loans
shall bear interest at the Floating Rate or such other rate agreed to by
the Swing Line Lender.
2.5.3. Making of Swing Line Loans. Promptly after receipt of a Swing
Line Borrowing Notice, the Agent shall notify each Lender by fax, or other
similar form of transmission, of the requested Swing Line Loan. Not later
than 2:00 p.m. (Chicago time) on the applicable Borrowing Date, the Swing
Line Lender shall make available the Swing Line Loan, in funds immediately
available in Detroit, to the Agent at its address specified pursuant to
Article XIII. The Agent will promptly make the funds so received from the
Swing Line Lender available to the Borrower on the Borrowing Date at the
Agent's aforesaid address.
2.5.4. Repayment of Swing Line Loans. Each Swing Line Loan shall be
paid in full by the Borrower upon demand by the Swing Line Lender and
automatically without demand on the Termination Date. In addition, the
Swing Line Lender may at any time in its sole discretion with respect to
any outstanding Swing Line Loan require each Lender (including the Swing
Line Lender) to make a Revolving Loan in the amount of such Lender's Pro
Rata Share of such Swing Line Loan (including, without limitation, any
interest accrued and unpaid thereon), for the purpose of repaying such
Swing Line Loan. Not later than noon (Chicago time) on the date of any
notice received pursuant to this Section 2.5.4, each Lender shall make
available its required Revolving Loan, in funds immediately available in
Detroit to the Agent at its address specified pursuant to Article XIII.
Revolving Loans made pursuant to this Section 2.5.4 shall initially be
Floating Rate Loans and thereafter may be continued as Floating Rate Loans
or converted into Eurodollar Loans in the manner provided in Section 2.10
and subject to the other conditions and limitations set forth in this
Article II. Unless a Lender shall have notified the Swing Line Lender,
prior to its making any Swing Line Loan, that any applicable condition
precedent set forth in Sections 4.1 or 4.2 had not then been satisfied,
such Lender's obligation to make Revolving Loans pursuant to this Section
2.5.4 to repay Swing Line Loans shall be unconditional, continuing,
irrevocable and absolute and shall not be affected by any circumstances,
including, without limitation, (a) any set-off, counterclaim, recoupment,
defense or other right which such Lender may have against the Agent, the
Swing Line Lender or any other Person, (b) the occurrence or continuance of
a Default or Unmatured Default, (c) any adverse change in the condition
(financial or otherwise) of the Borrower, or (d) any other circumstances,
happening or event whatsoever. In the event that any Lender fails to make
payment to the Agent of any amount due under this Section 2.5.4, the Agent
shall be entitled to receive, retain and apply against such obligation the
principal and interest otherwise payable to such Lender hereunder until the
Agent receives such payment from such Lender or such obligation is
otherwise fully satisfied. In addition to the foregoing, if for any reason
any Lender fails to make payment to the Agent of any amount due under this
Section 2.5.4, such Lender shall be deemed, at the option of the Agent, to
have unconditionally and irrevocably purchased from the Swing Line Lender,
without recourse or warranty, an undivided interest and participation in
the applicable Swing Line Loan in the amount of such Revolving Loan, and
such interest and participation may be recovered from such Lender together
with interest thereon at the Federal Funds Effective Rate for each day
during the period commencing on the date of demand and ending on the date
such amount is received. On the Facility Termination Date, the Borrower
shall repay in full the outstanding principal balance of the Swing Line
Loans.
2.6. Facility Fees. 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 (whether used or unused) from the
date hereof to and including the Facility Termination Date, payable on
16
each Payment Date hereafter, on the Facility Termination Date and thereafter on
demand, provided that, if any Lender continues to have any Outstanding Credit
Exposure after the termination of its Commitment (including, without limitation,
during any period when Outstanding Credit Exposure may be outstanding but new
Credit Extensions may not be borrowed hereunder), then such facility fee shall
continue to accrue on the aggregate principal amount of the Outstanding Credit
Exposure owed to such Lender until such Outstanding Credit Exposure is repaid in
full.
2.7. Minimum Amount of Each Advance. Each Eurodollar Advance shall be in
the minimum amount of $1,000,000 (and in multiples of $100,000 if in excess
thereof), and each Floating Rate Advance (other than an Advance to repay Swing
Line Loans) shall be in the minimum amount of $10,000, provided, however, that
any Floating Rate Advance may be in the amount of the unused Aggregate
Commitment.
2.8. Optional Principal Payments. The Borrower may from time to time pay,
without penalty or premium, all outstanding Floating Rate Advances (other than
Swing Line Loans), or, in a minimum aggregate amount of $10,000, any portion of
the outstanding Floating Rate Advances (other than Swing Line Loans) upon two
Business Days' prior notice to the Agent. The Borrower may at any time pay,
without penalty or premium, all outstanding Swing Line Loans, or, in a minimum
amount of $100,000 and increments of $50,000 in excess thereof, any portion of
the outstanding Swing Line Loans, with notice to the Agent and the Swing Line
Lender by 11:00 a.m. (Chicago time) on the date of repayment. 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 $100,000 in excess thereof, any portion of the outstanding
Eurodollar Advances upon three Business Days' prior notice to the Agent.
2.9. 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 (other than a Swing Line Loan) 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 Revolving Loan or Revolving Loans in funds immediately
available in Detroit 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.
2.10. Conversion and Continuation of Outstanding Advances. Floating Rate
Advances shall continue as Floating Rate Advances (other than Swing Line Loans)
unless and until such Floating Rate Advances are converted into Eurodollar
Advances pursuant to this Section 2.10 or are repaid in accordance with Section
2.8. Each Eurodollar Advance shall continue as a Eurodollar Advance until the
17
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
2.8 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 2.7, 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(other than Swing Line Loans) 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.
2.11. Changes in Interest Rate, etc. Each Floating Rate Advance (other than
a Swing Line Loan) 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 2.10, to but excluding the date it is paid or is converted
into a Eurodollar Advance pursuant to Section 2.10 hereof, at a rate per annum
equal to the Floating Rate for such day. Each Swing Line Loan shall bear
interest on the outstanding principal amount thereof, for each day from and
including the day such Swing Line Loan is made to but excluding the date it is
paid, at a rate per annum equal to the Floating Rate for such day. Changes in
the rate of interest on that portion of any Advance maintained as a Floating
Rate Advance will take effect simultaneously with each change in the Floating
Rate. Each Eurodollar 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 interest rate determined by the Agent as applicable to such Eurodollar
Advance based upon the Borrower's selections under Sections 2.9 and 2.10 and
otherwise in accordance with the terms hereof. No Interest Period may end after
the Facility Termination Date.
2.12. Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.9, 2.10 or 2.11, during the continuance of a
Default or Unmatured 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 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
Interest Period at the rate otherwise applicable to such Interest Period plus 2%
per annum, (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,
and (iii) the LC Fee shall be increased by 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)
18
and (ii) above and the increase in the LC Fee set forth in clause (iii) above
shall be applicable to all Credit Extensions without any election or action on
the part of the Agent or any Lender.
2.13. 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 (except in the
case of Reimbursement Obligations for which the LC Issuer has not been fully
indemnified by the Lenders, or as otherwise specifically required hereunder and
except with respect to repayments of Swing Line Loans) 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 JPMCB for each payment of principal, interest,
Reimbursement Obligations and fees as it becomes due hereunder. Each reference
to the Agent in this Section 2.13 shall also be deemed to refer, and shall apply
equally, to the LC Issuer, in the case of payments required to be made by the
Borrower to the LC Issuer pursuant to Section 2.19.6.
2.14. 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,
(c) the original stated amount of each Facility LC and the amount of LC
Obligations outstanding at any time, and (d) 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 or, in the case of the Swing Line Lender, promissory notes representing its
Revolving Loans and Swing Line Loans, respectively, substantially in the form of
Exhibit B, with appropriate changes for notes evidencing Swing Line Loans (each
a "Note"). In such event, the Borrower shall prepare, execute and deliver to
such Lender such Note or Notes payable to the order of such Lender. Thereafter,
the Loans evidenced by each such Note and interest thereon shall at all times
(prior to any assignment pursuant to Section 12.3) be represented by one or more
Notes payable to the order of the payee named therein, except to the extent that
any such Lender subsequently returns any such Note for cancellation and requests
that such Loans once again be evidenced as described in paragraphs (i) and (ii)
above.
2.15. 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
19
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.
2.16. 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 and at maturity.
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 fees and LC 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.
2.17. 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,
Swing Line Borrowing Notice, Conversion/Continuation Notice, and repayment
notice received by it hereunder. The Agent will notify each Lender of the
interest 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 Floating Rate.
2.18. Lending Installations. Each Lender may book its Loans and its
participation in any LC Obligations and the LC Issuer may book the Facility LCs
at any Lending Installation selected by such Lender or the LC Issuer, as the
case may be, 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, Facility LCs, participations in LC Obligations and any Notes issued
hereunder shall be deemed held by each Lender or the LC Issuer, as the case may
be, for the benefit of any such Lending Installation. Each Lender and the LC
Issuer 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 or Facility LCs will be issued by it and for
whose account Loan payments or payments with respect to Facility LCs are to be
made.
2.19. Facility LCs.
2.19.1. Issuance. The LC Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue standby and commercial
letters of credit (each, a "Facility LC") and to renew, extend, increase,
decrease or otherwise modify each Facility LC ("Modify," and each such
action a "Modification"), from time to time from and including the date of
this Agreement and prior to the Facility Termination Date upon the request
of the Borrower; provided that immediately after each such Facility LC is
issued or Modified, (i) the aggregate amount of the outstanding LC
Obligations shall not exceed $35,000,000 and (ii) the Aggregate Outstanding
Credit Exposure shall not exceed the Aggregate Commitment. No Facility LC
shall have an
20
expiry date later than the earlier of (x) the fifth Business Day prior to
the Facility Termination Date and (y) one year after its issuance.
2.19.2. Participations. Upon the issuance or Modification by the LC
Issuer of a Facility LC in accordance with this Section 2.19, the LC Issuer
shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably sold to each Lender, and each Lender shall
be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from the LC Issuer, a
participation in such Facility LC (and each Modification thereof) and the
related LC Obligations in proportion to its Pro Rata Share.
2.19.3. Notice. Subject to Section 2.19.1, the Borrower shall give the
LC Issuer notice prior to 10:00 a.m. (Chicago time) at least five Business
Days prior to the proposed date of issuance or Modification of each
Facility LC, specifying the beneficiary, the proposed date of issuance (or
Modification) and the expiry date of such Facility LC, and describing the
proposed terms of such Facility LC and the nature of the transactions
proposed to be supported thereby. Upon receipt of such notice, the LC
Issuer shall promptly notify the Agent, and the Agent shall promptly notify
each Lender, of the contents thereof and of the amount of such Lender's
participation in such proposed Facility LC. The issuance or Modification by
the LC Issuer of any Facility LC shall, in addition to the conditions
precedent set forth in Article IV (the satisfaction of which the LC Issuer
shall have no duty to ascertain), be subject to the conditions precedent
that such Facility LC shall be satisfactory to the LC Issuer and that the
Borrower shall have executed and delivered such application agreement
and/or such other instruments and agreements relating to such Facility LC
as the LC Issuer shall have reasonably requested (each, a "Facility LC
Application"). In the event of any conflict between the terms of this
Agreement and the terms of any Facility LC Application, the terms of this
Agreement shall control.
2.19.4. LC Fees. The Borrower shall pay to the Agent, for the account
of the Lenders ratably in accordance with their respective Pro Rata Shares,
(i) with respect to each standby Facility LC, a letter of credit fee at a
per annum rate equal to the Applicable Margin for Eurodollar Loans in
effect from time to time on the average daily undrawn stated amount under
such standby Facility LC, such fee to be payable in arrears on each Payment
Date, and (ii) with respect to each commercial Facility LC, a one-time
letter of credit fee in an amount equal to a percentage agreed upon between
the Borrower and the LC Issuer of the initial stated amount (or, with
respect to a Modification of any such commercial Facility LC which
increases the stated amount thereof, such increase in the stated amount)
thereof, such fee to be payable on the date of such issuance or increase
(each such fee described in this sentence an "LC Fee"). The Borrower shall
also pay to the LC Issuer for its own account (x) at the time of issuance
of each Facility LC, a fronting fee in an amount equal to 0.125% per annum
and (y) documentary and processing charges in connection with the issuance
or Modification of and draws under Facility LCs in accordance with the LC
Issuer's standard schedule for such charges as in effect from time to time.
2.19.5. Administration; Reimbursement by Lenders. Upon receipt from
the beneficiary of any Facility LC of any demand for payment under such
Facility LC, the LC Issuer shall notify the Agent and the Agent shall
promptly notify the Borrower and each other Lender as to the amount to be
paid by the LC Issuer as a result of such demand and the proposed payment
date (the "LC Payment Date"). The responsibility of the LC Issuer to the
Borrower and each Lender shall be only to determine that the documents
(including each demand for payment) delivered under each Facility LC in
connection with such presentment shall be in conformity in all material
respects with such Facility LC. The LC Issuer shall endeavor to exercise
the same care in the
21
issuance and administration of the Facility LCs as it does with respect to
letters of credit in which no participations are granted, it being
understood that in the absence of any gross negligence or willful
misconduct by the LC Issuer, each Lender shall be unconditionally and
irrevocably liable without regard to the occurrence of any Default or any
condition precedent whatsoever, to reimburse the LC Issuer on demand for
(i) such Lender's Pro Rata Share of the amount of each payment made by the
LC Issuer under each Facility LC to the extent such amount is not
reimbursed by the Borrower pursuant to Section 2.19.6 below, plus (ii)
interest on the foregoing amount to be reimbursed by such Lender, for each
day from the date of the LC Issuer's demand for such reimbursement (or, if
such demand is made after 11:00 a.m. (Chicago time) on such date, from the
next succeeding Business Day) to the date on which such Lender pays the
amount to be reimbursed by it, at a rate of interest per annum equal to the
Federal Funds Effective Rate for the first three days and, thereafter, at a
rate of interest equal to the rate applicable to Floating Rate Advances.
2.19.6. Reimbursement by Borrower. The Borrower shall be irrevocably
and unconditionally obligated to reimburse the LC Issuer on or before the
applicable LC Payment Date for any amounts to be paid by the LC Issuer upon
any drawing under any Facility LC, without presentment, demand, protest or
other formalities of any kind; provided that neither the Borrower nor any
Lender shall hereby be precluded from asserting any claim for direct (but
not consequential) damages suffered by the Borrower or such Lender to the
extent, but only to the extent, caused by (i) the willful misconduct or
gross negligence of the LC Issuer in determining whether a request
presented under any Facility LC issued by it complied with the terms of
such Facility LC or (ii) the LC Issuer's failure to pay under any Facility
LC issued by it after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. All such
amounts paid by the LC Issuer and remaining unpaid by the Borrower shall
bear interest, payable on demand, for each day until paid at a rate per
annum equal to (x) the rate applicable to Floating Rate Advances for such
day if such day falls on or before the applicable LC Payment Date and (y)
the sum of 2% plus the rate applicable to Floating Rate Advances for such
day if such day falls after such LC Payment Date. The LC Issuer will pay to
each Lender ratably in accordance with its Pro Rata Share all amounts
received by it from the Borrower for application in payment, in whole or in
part, of the Reimbursement Obligation in respect of any Facility LC issued
by the LC Issuer, but only to the extent such Lender has made payment to
the LC Issuer in respect of such Facility LC pursuant to Section 2.19.5.
Subject to the terms and conditions of this Agreement (including without
limitation the submission of a Borrowing Notice in compliance with Section
2.8 or a Swing Line Borrowing Notice in compliance with Section 2.5.2 and
the satisfaction of the applicable conditions precedent set forth in
Article IV), the Borrower may request an Advance hereunder for the purpose
of satisfying any Reimbursement Obligation.
2.19.7. Obligations Absolute. The Borrower's obligations under this
Section 2.19 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to
payment which the Borrower may have or have had against the LC Issuer, any
Lender or any beneficiary of a Facility LC. The Borrower further agrees
with the LC Issuer and the Lenders that the LC Issuer and the Lenders shall
not be responsible for, and the Borrower's Reimbursement Obligation in
respect of any Facility LC shall not be affected by, among other things,
the validity or genuineness of documents or of any endorsements thereon,
even if such documents should in fact prove to be in any or all respects
invalid, fraudulent or forged, or any dispute between or among the
Borrower, any of its Affiliates, the beneficiary of any Facility LC or any
financing institution or other party to whom any Facility LC may be
22
transferred or any claims or defenses whatsoever of the Borrower or of any
of its Affiliates against the beneficiary of any Facility LC or any such
transferee. The LC Issuer shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message
or advice, however transmitted, in connection with any Facility LC. The
Borrower agrees that any action taken or omitted by the LC Issuer or any
Lender under or in connection with each Facility LC and the related drafts
and documents, if done without gross negligence or willful misconduct,
shall be binding upon the Borrower and shall not put the LC Issuer or any
Lender under any liability to the Borrower. Nothing in this Section 2.19.7
is intended to limit the right of the Borrower to make a claim against the
LC Issuer for damages as contemplated by the proviso to the first sentence
of Section 2.19.6.
2.19.8. Actions of LC Issuer. The LC Issuer shall be entitled to rely,
and shall be fully protected in relying, upon any Facility LC, draft,
writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order
or other document believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon advice and
statements of legal counsel, independent accountants and other experts
selected by the LC Issuer. The LC Issuer shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Required Lenders as
it reasonably deems appropriate or it shall first be indemnified to its
reasonable satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to
take any such action. Notwithstanding any other provision of this Section
2.19, the LC Issuer shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement in accordance with a request
of the Required Lenders, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Lenders and any future
holders of a participation in any Facility LC.
2.19.9. Indemnification. The Borrower hereby agrees to indemnify and
hold harmless each Lender, the LC Issuer and the Agent, and their
respective directors, officers, agents and employees from and against any
and all claims and damages, losses, liabilities, costs or expenses which
such Lender, the LC Issuer or the Agent may incur (or which may be claimed
against such Lender, the LC Issuer or the Agent by any Person whatsoever)
by reason of or in connection with the issuance, execution and delivery or
transfer of or payment or failure to pay under any Facility LC or any
actual or proposed use of any Facility LC, including, without limitation,
any claims, damages, losses, liabilities, costs or expenses which the LC
Issuer may incur by reason of or in connection with (i) the failure of any
other Lender to fulfill or comply with its obligations to the LC Issuer
hereunder (but nothing herein contained shall affect any rights the
Borrower may have against any defaulting Lender) or (ii) by reason of or on
account of the LC Issuer issuing any Facility LC which specifies that the
term "Beneficiary" included therein includes any successor by operation of
law of the named Beneficiary, but which Facility LC does not require that
any drawing by any such successor Beneficiary be accompanied by a copy of a
legal document, satisfactory to the LC Issuer, evidencing the appointment
of such successor Beneficiary; provided that the Borrower shall not be
required to indemnify any Lender, the LC Issuer or the Agent for any
claims, damages, losses, liabilities, costs or expenses to the extent, but
only to the extent, caused by (x) the willful misconduct or gross
negligence of the LC Issuer in determining whether a request presented
under any Facility LC complied with the terms of such Facility LC or (y)
the LC Issuer's failure to pay under any Facility LC after the presentation
to it of a request strictly complying with the terms and conditions of such
Facility LC. Nothing in this Section 2.19.9 is intended to limit the
obligations of the Borrower under any other provision of this
23
Agreement.
2.19.10. Lenders' Indemnification. Each Lender shall, ratably in
accordance with its Pro Rata Share, indemnify the LC Issuer, its Affiliates
and their respective directors, officers, agents and employees (to the
extent not reimbursed by the Borrower) against any cost, expense (including
reasonable counsel fees and disbursements), claim, demand, action, loss or
liability (except such as result from such indemnitees' gross negligence or
willful misconduct or the LC Issuer's failure to pay under any Facility LC
after the presentation to it of a request strictly complying with the terms
and conditions of the Facility LC) that such indemnitees may suffer or
incur in connection with this Section 2.19 or any action taken or omitted
by such indemnitees hereunder.
2.19.11. Facility LC Collateral Account. The Borrower agrees that it
will, upon the request of the Agent or the Required Lenders and until the
final expiration date of any Facility LC and thereafter as long as any
amount is payable to the LC Issuer or the Lenders in respect of any
Facility LC, maintain a special collateral account pursuant to arrangements
satisfactory to the Agent (the "Facility LC Collateral Account") at the
Agent's office at the address specified pursuant to Article XIII, in the
name of such Borrower but under the sole dominion and control of the Agent,
for the benefit of the Lenders and in which such Borrower shall have no
interest other than as set forth in Section 8.1. The Borrower hereby
pledges, assigns and grants to the Agent, on behalf of and for the ratable
benefit of the Lenders and the LC Issuer, a security interest in all of the
Borrower's right, title and interest in and to all funds which may from
time to time be on deposit in the Facility LC Collateral Account to secure
the prompt and complete payment and performance of the Obligations. The
Agent will invest any funds on deposit from time to time in the Facility LC
Collateral Account in certificates of deposit of JPMCB having a maturity
not exceeding 30 days. Nothing in this Section 2.19.11 shall either require
the Borrower, or obligate the Agent to require the Borrower, to deposit any
funds in the Facility LC Collateral Account or limit the right of the Agent
to release any funds held in the Facility LC Collateral Account in each
case other than as required by Section 8.1.
2.19.12. Rights as a Lender. In its capacity as a Lender, the LC
Issuer shall have the same rights and obligations as any other Lender.
2.20. 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.
2.21. 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
24
convert Floating Rate Advances into, Eurodollar Advances shall be suspended
pursuant to Section 3.3 or any Lender is a Defaulting Lender (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.
2.22. Reductions in Aggregate Commitment. 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 Outstanding Credit Exposure.
2.23. Increases in Aggregate Commitment. (i) Subject to the conditions set
forth below, the Borrower may, upon at least ten (10) days (or such other period
of time agreed to between the Agent and the Borrower) prior written notice to
the Agent and the Lenders, increase the Aggregate Commitments from time to time,
either by designating a lender not theretofore a Lender to become a Lender (such
designation to be effective only with the prior written consent (such consent
not to be unreasonably withheld) of the Agent) or by agreeing with an existing
Lender that such Lender's Commitment shall be increased (thus increasing the
Aggregate Commitments); provided that:
(a) no Default or Unmatured Default shall have occurred and be
continuing hereunder as of the effective date of such increase;
(b) the representations and warranties made by the Borrower and
contained in Article V hereof shall be true and correct on and as of the
effective date with the same effect as if made on and as of such date
(other than those representations and warranties that by their terms speak
as of a particular date, which representations and warranties shall be true
and correct as of such particular date);
(c) the amount of such increase in the Aggregate Commitments shall not
be greater than $50,000,000, and shall not cause the Aggregate Commitments
to exceed $150,000,000;
(d) The Borrower and the Lender or lender not theretofore a Lender,
shall execute and deliver to the Agent, a Lender Addition and
Acknowledgement Agreement, in form and substance satisfactory to the Agent
and acknowledged by the Agent and each Borrower;
(e) no existing Lender shall be obligated in any way to increase its
Commitment;
25
(f) the Agent shall consent to such increase and the Borrower shall
have complied with such other conditions in connection with such increase
as may be required by the Agent.
(ii) Upon the execution, delivery, acceptance and recording of the Lender
Addition and Acknowledgement Agreement, from and after the effective date
specified in a Lender Addition and Acknowledgement Agreement, such existing
Lender shall have a Commitment as therein set forth or such other Lender shall
become a Lender with a Commitment as therein set forth and all the rights and
obligations of a Lender with such a Commitment hereunder.
(iii) Upon its receipt of a Lender Addition and Acknowledgement Agreement
together with any Note or Notes, if requested, subject to such addition and
assumption and the written consent to such addition and assumption, the Agent
shall, if such Lender Addition and Acknowledgement Agreement has been completed
and the other conditions described in this Section 2.23 have been satisfied:
(a) accept such Lender Addition and Acknowledgement Agreement;
(b) record the information contained therein in the Register; and
(c) give prompt notice thereof to the Lenders and the Borrower and
deliver to the Lenders a schedule reflecting the new Commitments.
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 or the LC Issuer 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 or the LC
Issuer to any Taxes, or changes the basis of taxation of payments
(other than with respect to Excluded Taxes) to any Lender or the LC
Issuer in respect of its Eurodollar Loans, Facility LCs or
participations therein, 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 or the LC Issuer
(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 or the LC
Issuer of making, funding or maintaining
26
its Eurodollar Loans, or of issuing or participating in Facility LCs,
or reduces any amount receivable by any Lender or any applicable
Lending Installation or the LC Issuer in connection with its
Eurodollar Loans, Facility LCs or participations therein, or requires
any Lender or any applicable Lending Installation or the LC Issuer to
make any payment calculated by reference to the amount of Eurodollar
Loans, Facility LCs or participations therein held or interest or LC
Fees received by it, by an amount deemed material by such Lender or
the LC Issuer as the case may be,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, of making
or maintaining its Eurodollar Loans or Commitment or of issuing or participating
in Facility LCs or to reduce the return received by such Lender or applicable
Lending Installation or the LC Issuer, as the case may be, in connection with
such Eurodollar Loans, Commitment, Facility LCs or participations therein, then,
within 15 days of demand by such Lender or the LC Issuer, as the case may be,
the Borrower shall pay such Lender or the LC Issuer, as the case may be, such
additional amount or amounts as will compensate such Lender or the LC Issuer, as
the case may be, for such increased cost or reduction in amount received.
3.2. Changes in Capital Adequacy Regulations. If a Lender or the LC Issuer
determines the amount of capital required or expected to be maintained by such
Lender or the LC Issuer, any Lending Installation of such Lender or the LC
Issuer, or any corporation controlling such Lender or the LC Issuer is increased
as a result of a Change, then, within 15 days of demand by such Lender or the LC
Issuer, the Borrower shall pay such Lender or the LC Issuer the amount necessary
to compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender or the LC Issuer determines is attributable
to this Agreement, its Outstanding Credit Exposure or its Commitment to make
Loans and issue or participate in Facility LCs, as the case may be, hereunder
(after taking into account such Lender's or the LC Issuer'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 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 the LC Issuer or any Lending
Installation or any corporation controlling any Lender or the LC Issuer.
"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
27
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. (i) All payments by the Borrower to or for the account of any
Lender, the LC Issuer or the Agent hereunder or under any Note or Facility LC
Application 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, the LC Issuer 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, the LC Issuer 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
Facility LC Application or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note or Facility LC Application ("Other
Taxes").
(iii) The Borrower hereby agrees to indemnify the Agent, the LC Issuer 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, the LC Issuer or such Lender and any liability
(including interest and expenses, unless resulting solely from such Lender's
failure to timely pay such Taxes or Other Taxes) arising therefrom or with
respect thereto. Payments due under this indemnification shall be made within 30
days of the date the Agent, the LC Issuer 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 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 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.
28
(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.
(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 costs and expenses related thereto
(including attorneys fees and 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 and the LC Issuer shall designate an alternate Lending
Installation with respect to its Eurodollar Loans or the Facility LCs to reduce
any liability of the Borrower to such Lender or the LC Issuer 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 or the LC Issuer shall deliver a
written statement of such Lender or the LC Issuer 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.
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ARTICLE IV
CONDITIONS PRECEDENT
4.1. Initial Credit Extension. The Lenders shall not be required to make
the initial Credit Extension hereunder unless the Borrower has furnished to the
Agent:
(i) Copies of the articles or certificate of incorporation of the Borrower
and each Guarantor, together with all amendments, and a certificate of
good standing, each certified by the appropriate governmental officer
in its jurisdiction of incorporation.
(ii) Copies, certified by the Secretary or Assistant Secretary of the
Borrower and each Guarantor, of its by-laws and of its Board of
Directors' resolutions and of resolutions or actions of any other body
authorizing the execution of the Loan Documents to which the Borrower
is a party.
(iii) An incumbency certificate, executed by the Secretary or Assistant
Secretary of the Borrower and each Guarantor, which shall identify by
name and title and bear the signatures of the Authorized Officers and
any other officers of the Borrower and each Guarantor authorized to
sign the Loan Documents to which it is a party, upon which certificate
the Agent and the Lenders shall be entitled to rely until informed of
any change in writing by the Borrower or such Guarantor.
(iv) A certificate, signed by the chief financial officer of the Borrower,
stating that on the initial Credit Extension Date no Default or
Unmatured Default has occurred and is continuing.
(v) A written opinion of the Borrower's and each Guarantor's counsel,
addressed to the Lenders in substantially the form of Exhibit D.
(vi) Any Notes requested by a Lender pursuant to Section 2.14 payable to
the order of each such requesting Lender.
(vii) Written money transfer instructions, in substantially the form of
Exhibit E, 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 and the payment of all fees
required in connection herewith.
(viii) All Guaranties signed by the Guarantors.
(ix) Copies of such financial statements of the Borrower and its
Subsidiaries required by the Agent, together with prospective
financial information for the Borrower and its Subsidiaries, in each
case in form and substance satisfactory to the Agent.
(x) The Borrower and its Subsidiaries shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that
are necessary in connection with the transactions contemplated by the
Loan Documents, and each of the foregoing shall be in full force and
effect.
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(xi) All liabilities and obligations under the existing Three-Year Credit
Agreement of the Borrower dated December 30, 2002, as amended, shall
be paid in full and the credit facility thereunder shall be terminated
(and the Borrower hereby agrees that any commitment to lend or other
credit facility under such credit agreement is terminated).
(xii) The Agent shall have received a certificate from the chief financial
officer of the Borrower concerning the solvency and other appropriate
factual information with respect to the Borrower and its Subsidiaries,
in form and substance satisfactory to the Agent.
(xiii) Satisfactory results of all due diligence required by the Agent,
including without limitation a review of all contingent liabilities, a
review of contracts and insurance, a review of all litigation,
environmental matters, all retiree medical benefits, ERISA matters and
other due diligence with respect to the Borrower and its Subsidiaries
as required by the Agent.
(xiv) The Agent shall have determined that there is an absence of any
material adverse change or disruption in primary or secondary loan
syndication markets or in capital markets generally that would likely
impair syndication of the Obligations hereunder.
(xv) The Agent shall have received such other documents as the Agent or its
counsel may have reasonably requested.
4.2. Each Credit Extension. The Lenders shall not (except as otherwise set
forth in Section 2.5.4 with respect to Revolving Loans for the purpose of
repaying Swing Line Loans) be required to make any Credit Extension unless on
the applicable Credit Extension 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 Credit Extension Date except to 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 Credit Extension
shall be satisfactory to the Lenders and their counsel.
Each Borrowing Notice, Swing Line Borrowing Notice or request for issuance
of a Facility LC with respect to each such Credit Extension 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 F as a
condition to making a Credit Extension.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1. Existence and Standing. Each of the Borrower and its Subsidiaries is a
corporation, partnership (in the case of Subsidiaries only) or limited liability
company duly and properly incorporated or organized, as the case may be, validly
existing and (to the extent such concept applies to such entity) in good
standing under the laws of its jurisdiction of incorporation or organization 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 and each Guarantor has the
power and authority and legal right to execute and deliver the Loan Documents to
which it is a party and to perform its obligations thereunder. The execution and
delivery by the Borrower and each Guarantor of the Loan Documents to which it is
a party and the performance of its obligations thereunder have been duly
authorized by proper corporate proceedings, and the Loan Documents to which the
Borrower is a party 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 or any Guarantor of the Loan Documents to which it is a party, nor
the consummation of the transactions therein contemplated, nor compliance with
the provisions thereof will violate (i) any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Borrower or any of its
Subsidiaries or (ii) the Borrower's or any Subsidiary's articles or certificate
of incorporation, partnership agreement, certificate of partnership, articles or
certificate of organization, by-laws, or operating or other management
agreement, as the case may be, or (iii) 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, or require, the creation or
imposition of any Lien in, of or on the Property of the Borrower or a Subsidiary
pursuant to the terms of any such indenture, instrument or agreement. No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its Subsidiaries,
is required to be obtained by the Borrower or any of its Subsidiaries in
connection with the execution and delivery of the Loan Documents, the borrowings
under this Agreement, the payment and performance by the Borrower of the
Obligations or the legality, validity, binding effect or enforceability of any
of the Loan Documents.
5.4. Financial Statements. The December 31, 2003 and the September 30, 2004
consolidated financial statements of the Borrower and its Subsidiaries
heretofore delivered to the Lenders were prepared in accordance with Agreement
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. Since December 31, 2003 there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower
32
and its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect, except as disclosed in the SEC Reports.
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 adequate reserves have been
provided in accordance with Agreement Accounting Principles and as to which no
Lien exists. No tax liens have been filed and no claims are being asserted with
respect to any such taxes. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are adequate.
5.7. Litigation and Contingent Obligations. Except as set forth on Schedule
5.7, 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 or which seeks to
prevent, enjoin or delay the making of any Credit Extensions. Other than any
liability incident to any litigation, arbitration or proceeding which could not
reasonably be expected to have a Material Adverse Effect, the Borrower has no
material contingent obligations not provided for or disclosed in the financial
statements referred to in Section 5.4.
5.8. Subsidiaries. Schedule 1 contains an accurate list of all Subsidiaries
of the Borrower as of the date of this Agreement, setting forth their respective
jurisdictions of organization and the percentage of their respective Capital
Stock or other ownership interests owned by the Borrower or other Subsidiaries.
All of the issued and outstanding shares of Capital Stock or other ownership
interests of such Subsidiaries have been (to the extent such concepts are
relevant with respect to such ownership interests) duly authorized and issued
and are fully paid and non-assessable.
5.9. ERISA. No Accumulated Funding Deficiency exists with respect to any
Single Employer Plan. Neither the Borrower nor any other member of the
Controlled Group has incurred, or is reasonably expected to incur, any
withdrawal liability to Multiemployer Plans in excess of $15,000,000 in the
aggregate. 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, neither the Borrower nor any other member of the Controlled
Group has withdrawn from any Plan or initiated steps to do so, and no steps have
been taken to reorganize or terminate any Plan.
5.10. Accuracy of Information. No information, exhibit or report 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,
taken in the light of all other information supplied to the Agent and the
Lenders, contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading.
5.11 Regulations T, U and X. Neither the Borrower nor any of its
Subsidiaries extends or maintains, in the ordinary course of business, credit
for the purpose, whether immediate, incidental, or ultimate, of buying or
carrying Margin Stock, and no part of the proceeds of any Advance will be used
for the purpose, whether immediate, incidental, or ultimate, of buying or
carrying any such Margin Stock or maintaining or extending credit to others for
such purpose in any way that would violate Regulation T, U or X. After applying
the proceeds of each Advance, Margin Stock will not constitute more than 25% of
the value of the assets (either of the Borrower alone or of the Borrower and its
Subsidiaries on a
33
consolidated basis) that are subject to any provisions of any Loan Document that
may cause the Advances to be deemed secured, directly or indirectly, by Margin
Stock. The Borrower and its Subsidiaries are in compliance with Section 6.2.
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 (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have complied
with all applicable Requirements of Law except for any failure to comply with
any of the foregoing which could not reasonably be expected to have a Material
Adverse Effect.
5.14. Ownership of Properties. Except as set forth on Schedule 2, on the
date of this Agreement, the Borrower and its Subsidiaries will have good title,
free of all Liens other than those permitted by Section 6.15, to all of the
Property and assets reflected in the Borrower's most recent consolidated
financial statements provided to the Agent as owned by the Borrower and its
Subsidiaries.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an entity
deemed to hold "plan assets" within the meaning of 29 C.F.R. Section 2510.3-101
of an employee benefit plan (as defined in Section 3(3) of ERISA) which is
subject to Title I of ERISA or any plan (within the meaning of Section 4975 of
the Code), and neither the execution of this Agreement nor the making of Credit
Extensions hereunder gives rise to a prohibited transaction within the meaning
of Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business, the
officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. Except as disclosed in the SEC Reports, on the basis
of this consideration, the Borrower has concluded that Environmental Laws cannot
reasonably be expected to have a Material Adverse Effect. Except as disclosed in
the SEC Reports, 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 Environmental Laws or are 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.
5.17. Investment Company Act. Neither the Borrower nor any Subsidiary is an
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
5.18. 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.
34
5.19. Solvency. (i) Immediately after the consummation of the transactions
to occur on the date hereof and immediately following the making of each Credit
Extension, if any, made on the date hereof and after giving effect to the
application of the proceeds of such Credit Extensions, (a) the fair value of the
assets of the Borrower and its Subsidiaries on a consolidated basis, at a fair
valuation, will exceed the debts and liabilities, subordinated, contingent or
otherwise, of the Borrower and its Subsidiaries on a consolidated basis; (b) the
present fair saleable value of the Property of the Borrower and its Subsidiaries
on a consolidated basis will be greater than the amount that will be required to
pay the probable liability of the Borrower and its Subsidiaries on a
consolidated basis on their debts and other liabilities, subordinated,
contingent or otherwise, as such debts and other liabilities become absolute and
matured; (c) the Borrower and its Subsidiaries on a consolidated basis will be
able to pay their debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured; and (d) the Borrower
and its Subsidiaries on a consolidated basis will not have unreasonably small
capital with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(ii) The Borrower does not intend to, or to permit any of its Subsidiaries
to, and does not believe that it or any of its Subsidiaries will, incur debts
beyond its ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it or any such Subsidiary and
the timing of the amounts of cash to be payable on or in respect of its
Indebtedness or the Indebtedness of any such Subsidiary.
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 (except for qualifications relating to changes in
accounting principles or practices reflecting changes in generally
accepted accounting principles and required or approved by the
Borrower's independent certified public accountants) audit report
certified by independent certified public accountants acceptable to
the Lenders, prepared in accordance with Agreement Accounting
Principles on a consolidated basis 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 statement of
cash flows, accompanied by (a) any management letter prepared by said
accountants, and (b) 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.
35
(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 unaudited balance sheets as at the close of each such
period and consolidated profit and loss and reconciliation of surplus
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.
(iii) As soon as available, but in any event within 30 days after the
beginning of each fiscal year of the Borrower, a copy of the plan and
forecast (including a projected consolidated and consolidating balance
sheet, income statement and funds flow statement) of the Borrower for
such fiscal year.
(iv) Together with the financial statements required under Sections 6.1(i)
and (ii), a compliance certificate in substantially the form of
Exhibit F signed by its chief financial officer 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.
(v) Within 365 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.
(vi) 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 of the Borrower,
describing said Reportable Event and the action which the Borrower
proposes to take with respect thereto.
(vii) 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
either case, could reasonably be expected to have a Material Adverse
Effect.
(viii) Promptly upon the furnishing thereof to the shareholders of the
Borrower, copies of all financial statements, reports and proxy
statements so furnished.
(ix) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports
which the Borrower or any of its Subsidiaries files with the
Securities and Exchange Commission.
(x) Such other information (including non-financial information) as the
Agent or any Lender may from time to time reasonably request.
6.2. Use of Proceeds. The Borrower will use the proceeds of the Credit
Extensions for working capital and other general corporate purposes. The
Borrower will not, nor will it permit the Borrower or any Subsidiary to, use any
of the proceeds of the Advances to purchase or carry any Margin Stock.
36
6.3. Notice of Default. The Borrower will, and will cause each Subsidiary
to, give prompt notice in writing to the Lenders of the occurrence of any
Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each Subsidiary
to, carry on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted and do
all things necessary to remain duly incorporated or organized, validly existing
and (to the extent such concept applies to such entity) in good standing as a
domestic corporation, partnership or limited liability company in its
jurisdiction of incorporation or organization, as the case may be, and maintain
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to, timely
file complete and correct United States federal and applicable foreign, state
and local tax returns required by law and 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 in accordance
with Agreement Accounting Principles.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice, 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 Requirements of Law, except where the failure to
do so 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.
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, 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 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 at such
reasonable times and intervals as the Agent or any Lender may designate.
6.10. Dividends. The Borrower will not, nor will it permit any Subsidiary
to, declare or pay any dividends or make any distributions on its Capital Stock
(other than dividends payable in its own Capital Stock) or redeem, repurchase or
otherwise acquire or retire any of its Capital Stock at any time outstanding,
except that (i) any Subsidiary may declare and pay dividends or make
distributions to the Borrower or to a Wholly-Owned Subsidiary, and (ii) the
Borrower may declare and pay dividends on its Capital Stock and make
redemptions, repurchases or other acquisitions or retirements of any of its
37
Capital Stock provided that in each case no Default or Unmatured Default shall
exist before or after giving effect thereto or be caused as a result thereof.
6.11. Non-Guarantor Indebtedness. The Borrower will not permit any
Subsidiary which is not a Guarantor to create, incur or suffer to exist any
Indebtedness, except:
(i) Indebtedness existing on the date hereof and described in Schedule 2
and the Indebtedness to be incurred prior to May 30, 2005 and
described in footnote 2 of Schedule 2, but no increase in the amount
of any of the foregoing as reduced from time to time.
(ii) Indebtedness of Brazilian Subsidiaries owing to the government of
Brazil in an aggregate amount not to exceed the lesser of (a)
$50,000,000 or (b) the aggregate amount of cash and cash equivalents
of the Brazilian Subsidiaries.
(iii) Other Indebtedness in an aggregate outstanding amount for all such
Subsidiaries not to exceed $25,000,000.
6.12. 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 of the Borrower may merge with the Borrower, provided that the
Borrower shall be the surviving corporation, (ii) a Subsidiary of the Borrower
may merge or consolidate with a Guarantor, provided that the Guarantor shall be
the surviving corporation, (iii) a Subsidiary of the Borrower that is not a
Guarantor may merge, consolidate or amalgamate with any other Subsidiary of the
Borrower that is not a Guarantor, and (iv) the Borrower or any Subsidiary may
merge, consolidate or amalgamate with any other Person in connection with an
Acquisition, provided that, if any such merger involves the Borrower or a
Guarantor, the Borrower or such Guarantor shall be the surviving corporation and
such Acquisition is permitted pursuant to the terms of Section 6.14.
6.13. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of inventory in the ordinary course of business.
(ii) Any transfer of an interest in accounts or notes receivable and
related assets as part of a Qualified Receivables Transaction,
provided that, immediately before and after any such transaction, no
Default or Unmatured Default shall exist or shall have occurred and be
continuing.
(iii) Transfers of assets between Guarantors or between the Borrower and
Guarantors.
(iv) Transfers of assets between the Borrower's Subsidiaries that are not
Guarantors.
(v) Transfers of assets from the Borrower's Subsidiaries that are not
Guarantors to the Borrower or any Guarantor.
(vi) Other leases, sales or other dispositions of its Property that,
together with all other Property of the Borrower and its Subsidiaries
previously leased, sold or disposed of (other than inventory in the
ordinary course of business) as permitted by this clause (vi)
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shall be less than: (a) in any fiscal year of the Borrower, 15% of the
consolidated assets of the Borrower and its Subsidiaries or Property
which is responsible for more than 15% of the consolidated net sales
or of the consolidated net income of the Borrower and its
Subsidiaries, in each case, as would be shown in the consolidated
financial statements of the Borrower and its Subsidiaries as of the
end of the immediately preceding fiscal year, and (b) cumulatively
after the date hereof, 30% of the consolidated assets of the Borrower
and its Subsidiaries or Property which is responsible for more than
30% of the consolidated net sales or of the consolidated net income of
the Borrower and its Subsidiaries, in each case, as would be shown in
the consolidated financial statements of the Borrower and its
Subsidiaries as of the end of the most recent fiscal quarter ending
prior to the date hereof, provided that, immediately before and after
any such transaction, no Default or Unmatured Default shall exist or
shall have occurred and be continuing.
6.14. Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefore, or to create any Subsidiary or to
become or remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:
(i) Cash Equivalent Investments.
(ii) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule 1, without any
increase in the amount thereof (other than due to fluctuations in the
market value thereof that are not the result of any additional
investment).
(iii) Investments comprised of capital contributions (whether in the form
of cash, a note, or other assets) to a Subsidiary or other
special-purpose entity created solely to engage in a Qualified
Receivables Transaction or otherwise resulting from transfers of
assets permitted by Section 6.13(iii) to such a special-purpose
entity.
(iv) Investments in Guarantors.
(v) Other Investments (other than Acquisitions) provided that the
aggregate amount of such Investments made in any fiscal year does not
exceed 7.5% of Consolidated Net Worth as of the beginning of such
fiscal year.
(vi) Any Acquisition, provided that (a) immediately before and after giving
effect to such Acquisition, on a pro forma basis acceptable to the
Agent, no Default or Unmatured Default shall exist or shall have
occurred and be continuing and the representations and warranties
contained in Article V and in the other Loan Documents shall be true
and correct on and as of the date thereof (both before and after such
Acquisition is consummated) as if made on the date such Acquisition is
consummated, (b) the target of such Acquisition is in substantially
the same line of business as the Borrower, (c) such Acquisition is
non-hostile and the Board of Directors of the target of such
Acquisition has approved such Acquisition, and (d) the aggregate
consideration paid or payable in connection with any Acquisition or
series of related Acquisitions permitted by this Section 6.14(vi),
including without limitation all direct payments, all deferred
payments, all Indebtedness assumed and all other consideration, shall
not exceed $150,000,000.
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6.15. Liens. The Borrower will not, nor will it permit any Subsidiary to,
create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies on its
Property if the same shall not at the time be delinquent or thereafter
can be paid without penalty, or are being contested in good faith and
by appropriate proceedings and for which adequate reserves in
accordance with Agreement Accounting Principles shall have been set
aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's and mechanics'
liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days
past due or which are being contested in good faith by appropriate
proceedings and for which adequate reserves shall have been set aside
on its books.
(iii) Liens arising out of pledges or deposits under worker's compensation
laws, unemployment insurance, old age pensions, or other social
security or retirement benefits, or similar legislation.
(iv) Utility easements, building restrictions and such other encumbrances
or charges against real property as are of a nature generally existing
with respect to properties of a similar character and which do not in
any material way affect the marketability of the same or interfere
with the use thereof in the business of the Borrower or its
Subsidiaries.
(v) Liens existing on the date hereof and described in Schedule 2.
(vii) Liens incurred in connection with any transfer of an interest in
accounts or notes receivable or related assets as part of a Qualified
Receivables Transaction.
(viii) Liens securing Indebtedness and not otherwise permitted by the
foregoing provisions of this Section 6.15, provided that the aggregate
outstanding principal amount of the Indebtedness secured by all such
Liens shall not at any time exceed 7.5% of Consolidated Net Worth.
6.16. 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 except (i) 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 comparable arms-length
transaction and (ii) transactions between the Borrower or any Subsidiary, on the
one hand, and any Subsidiary or other special-purpose entity created to engage
solely in a Qualified Receivables Transaction.
6.17 Limitation on Restrictions on Subsidiary Distributions. The Borrower
will not, and will not permit any Subsidiary to, enter into or suffer to exist
or become effective any consensual encumbrance or restriction on the ability of
any Subsidiary of the Borrower to (i) pay dividends or make any other
distributions in respect of any Capital Stock of such Subsidiary held by, or pay
any Indebtedness owed to, the Borrower or any other Subsidiary of the Borrower,
(ii) make loans or advances to the Borrower or any other Subsidiary of the
Borrower or (iii) transfer any of its assets to the Borrower
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or any other Subsidiary of the Borrower, except for such encumbrances or
restrictions existing under or by reason of (a) any restrictions existing under
the Loan Documents, (b) any restrictions with respect to a Subsidiary imposed
pursuant to an agreement which has been entered into in connection with the
disposition of all or substantially all of the Capital Stock or assets of such
Subsidiary, or (c) any restrictions with respect to assets encumbered by a Lien
permitted by Section 6.15 so long as such restriction applies only to the assets
encumbered by such permitted Lien.
6.18 Financial Contracts. The Borrower will not, and will not permit any
Subsidiary to, enter into or remain a party to any Financial Contract for
purposes of financial speculation, provided that hedging by the Borrower or any
of its Subsidiaries of their own interest rate or foreign currency exposure
shall not be deemed financial speculation.
6.19. Financial Covenants.
6.19.1. Fixed Charge Coverage Ratio. The Borrower will not permit the
Fixed Charge Coverage Ratio to be less than 3.00 to 1.0 as of the end of
any fiscal quarter.
6.19.2. Leverage Ratio. The Borrower will not permit the Leverage
Ratio to be greater than 3.00 to 1.0 as of the end of any fiscal quarter
ending after the date hereof.
6.19.3. Minimum Net Worth. The Borrower will at all times maintain
Consolidated Net Worth of not less than the sum of (i) $900,000,000 plus
(ii) 50% of Consolidated Net Income earned in the two consecutive fiscal
quarters ending December 31, 2004 (without deduction for losses) plus (iii)
50% of Consolidated Net Income earned in each fiscal year ending on or
after December 31, 2005 (without deduction for losses).
6.20 Additional Covenants. This covenant governs any instrument or
agreement, or any group of related instruments or agreements, relating to or
amending any terms or conditions applicable to any Indebtedness equal to or
greater than $100,000,000 of the Borrower or a Subsidiary (each a "Debt
Instrument"), whether such Debt Instrument is now existing or subsequently
entered into by the Borrower or a Subsidiary. The Borrower shall promptly
deliver to the Agent a copy of each Debt Instrument. If any Debt Instrument
contains any covenant, term or condition or default not substantially provided
for in this Agreement or that is more favorable to the lender or lenders
thereunder than those provided for in this Agreement (each a "More Favorable
Provision"), such More Favorable Provision shall be incorporated by reference in
this Agreement as if set forth fully herein (a) as of the date of this Agreement
if such Debt Instrument is now existing, or (b) as of the effective date of the
Debt Instrument if the Borrower or a Subsidiary subsequently enters into such
Debt Instrument. No amendment, other modification, termination or expiration of
any More Favorable Provision shall alter or otherwise affect such provision as
incorporated herein, except that any modification which makes such provision
become more favorable to the applicable lender shall be incorporated herein in
addition to (and not in lieu of) the provisions which it replaces.
Notwithstanding the foregoing, More Favorable Provisions shall not include any
term of a Debt Instrument relating to amount, rate of interest, fees,
amortization, or maturity of the Indebtedness or the conditions to be satisfied
for consummation of the related borrowing.
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ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall constitute
a Default:
7.1. Any representation or warranty made 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 Credit Extension, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be materially false on the date as of which made.
7.2. Nonpayment of principal of any Loan when due, nonpayment of any
Reimbursement Obligation within one Business Day after the same becomes due, or
nonpayment of interest upon any Loan or of any facility fee, LC Fee or other
obligations under any of the Loan Documents within five days after the same
becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Section 6.1, 6.2, 6.3, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15 or 6.19.
7.4. The breach by the Borrower (other than a breach which constitutes a
Default under another Section of this Article VII) of any of the terms or
provisions of this Agreement which is not remedied within thirty days after
written notice from the Agent or any Lender.
7.5. Failure of the Borrower or any of its Subsidiaries to pay when due any
Material Indebtedness; or the default by the Borrower or any of its Subsidiaries
in the performance (beyond the applicable grace period with respect thereto, if
any) of any term, provision or condition contained in any Material Indebtedness
Agreement, or any other event shall occur or condition exist, the effect of
which default, event or condition is to cause, or to permit the holder(s) of
such Material Indebtedness or the lender(s) under any Material Indebtedness
Agreement to cause, such Material Indebtedness to become due prior to its stated
maturity or any commitment to lend under any Material Indebtedness Agreement to
be terminated prior to its stated expiration date; or any Material Indebtedness
of the Borrower or any of its Subsidiaries shall be declared to be due and
payable or required to be prepaid or repurchased (other than by a regularly
scheduled payment) prior to the stated maturity thereof; or the Borrower or any
of its Subsidiaries shall not pay, or admit in writing its inability to pay, its
debts generally as they become due.
7.6. 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, 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 or partnership action to authorize or effect any of the
foregoing actions set forth in this Section 7.6 or (vi) fail to contest in good
faith any appointment or proceeding described in Section 7.7.
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7.7. 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. Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of, all or any portion of the
Property of the Borrower and 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 action occurs, constitutes a Substantial
Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money in excess of $15,000,000 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10. Any Change in Control shall occur.
7.11. The occurrence of any "default", as defined in any Loan Document
(other than this Agreement) or the breach of any of the terms or provisions of
any Loan Document (other than this Agreement), which default or breach continues
beyond any period of grace therein provided.
7.12. Any Guaranty shall fail to remain in full force or effect or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Guaranty, or any Guarantor shall fail to comply with any
of the terms or provisions of any Guaranty to which it is a party, or any
Guarantor shall deny that it has any further liability under any Guaranty to
which it is a party, or shall give notice to such effect.
7.13. Any member of the Controlled Group shall fail to pay when due an
amount or amounts aggregating in excess of $15,000,000 which it shall have
become liable to pay under Title IV of ERISA; or notice of intent to terminate a
Single Employer Plan with Unfunded Liabilities in excess of $15,000,000 (a
"Material Plan") shall be filed under Section 4041(c) of ERISA by any member of
the Controlled Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to
terminate, to impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or to cause a trustee to be appointed to administer any
Material Plan; or a condition shall exist that could reasonably be expected to
result in PBGC obtaining a decree adjudicating that any Material Plan must be
terminated; or there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one
or more Multiemployer Plans which causes one or more members of the Controlled
Group to incur a current payment obligation for withdrawal liability in excess
of $15,000,000 in aggregate amount for the Controlled Group.
43
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration; Facility LC Collateral Account. (i) 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 and the obligation and power
of the LC Issuer to issue Facility LCs shall automatically terminate and the
Obligations shall immediately become due and payable without any election or
action on the part of the Agent, the LC Issuer or any Lender and the Borrower
will be and become thereby unconditionally obligated, without any further
notice, act or demand, to pay to the Agent an amount in immediately available
funds, which funds shall be held in the Facility LC Collateral Account, equal to
the difference of (x) the amount of LC Obligations at such time, less (y) the
amount on deposit in the Facility LC Collateral Account at such time which is
free and clear of all rights and claims of third parties and has not been
applied against the Obligations (such difference, the "Collateral Shortfall
Amount"). If any other Default occurs, the Required Lenders (or the Agent with
the consent of the Required Lenders) may (a) terminate or suspend the
obligations of the Lenders to make Loans hereunder and the obligation and power
of the LC Issuer to issue Facility LCs, 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, and (b) upon notice to the Borrower
and in addition to the continuing right to demand payment of all amounts payable
under this Agreement, make demand on the Borrower to pay, and the Borrower will,
forthwith upon such demand and without any further notice or act, pay to the
Agent the Collateral Shortfall Amount, which funds shall be deposited in the
Facility LC Collateral Account.
(ii) If at any time while any Default is continuing, the Agent determines
that the Collateral Shortfall Amount at such time is greater than zero, the
Agent may make demand on the Borrower to pay, and the Borrower will, forthwith
upon such demand and without any further notice or act, pay to the Agent the
Collateral Shortfall Amount, which funds shall be deposited in the Facility LC
Collateral Account.
(iii) The Agent may at any time or from time to time after funds are
deposited in the Facility LC Collateral Account if a Default has occurred and is
continuing, apply such funds to the payment of the Obligations and any other
amounts as shall from time to time have become due and payable by the Borrower
to the Lenders or the LC Issuer under the Loan Documents.
(iv) At any time while any Default is continuing, neither the Borrower nor
any Person claiming on behalf of or through the Borrower shall have any right to
withdraw any of the funds held in the Facility LC Collateral Account. After all
of the Obligations have been indefeasibly paid in full and the Aggregate
Commitment has been terminated, any funds remaining in the Facility LC
Collateral Account shall be returned by the Agent to the Borrower or paid to
whomever may be legally entitled thereto at such time.
(v) If, within 30 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans and
the obligation and power of the LC Issuer to issue Facility LCs hereunder as a
result of any Default (other than any Default as described in Section 7.6 or 7.7
with respect to the Borrower) and before any judgment or decree for the payment
of the Obligations due shall have been obtained or entered, the Required Lenders
(in their sole discretion) shall so direct, the Agent shall, by notice to the
Borrower, rescind and annul such acceleration and/or termination.
44
8.2. Amendments. Subject to the provisions of this Section 8.2, 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 waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
(i) Extend the final maturity of any Loan, or extend the expiry date of
any Facility LC to a date after the Facility Termination Date, or
forgive all or any portion of the principal amount thereof or any
Reimbursement Obligation related thereto, or reduce the rate or extend
the time of payment of interest or fees thereon or Reimbursement
Obligations related thereto.
(ii) Reduce the percentage specified in the definition of Required Lenders.
(iii) Extend the Facility Termination Date, or reduce the amount or extend
the payment date for, the mandatory payment required under Section
2.2, or increase the amount of the Aggregate Commitment or of the
Commitment of any Lender hereunder or permit the Borrower to assign
its rights under this Agreement.
(iv) Amend this Section 8.2.
(v) Release any Guarantor or Guarantors that would constitute a
Significant Subsidiary.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. No amendment of any
provision of this Agreement relating to the Swing Line Lender or any Swing Line
Loans shall be effective without the written consent of the Swing Line Lender.
No amendment of any provision relating to the LC Issuer or any Facility LCs
shall be effective without the written consent of the LC Issuer. 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 anything herein to the contrary, no Defaulting Lender shall be
entitled to vote (whether to consent or to withhold its consent) with respect to
any amendment, modification, termination or waiver requiring the consent of the
Required Lenders and, for purposes of determining the Required Lenders, the
Commitments and Loans of each Defaulting Lender shall be disregarded.
8.3. Preservation of Rights. No delay or omission of the Lenders, the LC
Issuer 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 Credit Extension notwithstanding the existence of a
Default or the inability of the Borrower to satisfy the conditions precedent to
such Credit Extension 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, the LC
Issuer and the Lenders until the Obligations have been paid in full.
45
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 Credit
Extensions herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.
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, the LC Issuer and the Lenders and
supersede all prior agreements and understandings among the Borrower, the Agent,
the LC Issuer and the Lenders relating to the subject matter thereof other than
those contained in the fee letter described in Section 10.13 which shall survive
and remain in full force and effect during the term of this Agreement.
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 Arranger 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. (i) The Borrower shall reimburse the Agent
and the Arranger for any reasonable costs and out-of-pocket expenses (including
attorneys' fees of attorneys for the Agent) paid or incurred by the Agent or the
Arranger in connection with the preparation, negotiation, execution, delivery,
syndication, distribution (including, without limitation, via the internet),
review, amendment, modification, and administration of the Loan Documents. The
Borrower also agrees to reimburse the Agent, the Arranger, the LC Issuer and the
Lenders for any reasonable costs and out-of-pocket expenses (including
attorneys' fees of attorneys for the Agent, the Arranger, the LC Issuer and the
Lenders) paid or incurred by the Agent, the Arranger, the LC Issuer or any
Lender in connection with the collection and enforcement of the Loan Documents.
(ii) The Borrower hereby further agrees to indemnify the Agent, the
Arranger, the LC Issuer, each Lender, their respective affiliates, and each of
their directors, officers and employees against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all expenses of litigation or preparation therefor whether or not the Agent, the
Arranger, the LC Issuer, any Lender or any affiliate is a party thereto) which
any of them may pay or incur arising out of or relating to this Agreement, the
other Loan Documents, any Acquisition, the transactions contemplated hereby or
the direct or indirect application or proposed application of the proceeds of
any Credit Extension hereunder
46
except to the extent that they are determined in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the party seeking indemnification. The obligations of
the Borrower under this Section 9.6 shall survive the termination of this
Agreement.
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;
provided that, if the Borrower notifies the Agent that the Borrower wishes to
amend any covenant contained in Article VI to eliminate the effect of any change
in generally accepted accounting principles on the calculation of such covenant
(or if the Agent notifies the Borrower that the Required Lenders wish to amend
Article VI for such purpose), then the Borrower's compliance with such covenant
shall be determined on the basis of generally accepted accounting principles in
effect immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Borrower and the Required
Lenders. Notwithstanding anything herein, in any financial statements of the
Borrower or in Agreement Accounting Principles to the contrary, for purposes of
calculating and determining compliance with the financial covenants in Article
VI and determining the Applicable Margin and the Applicable Facility Fee Rate,
including defined terms used therein, any Acquisition made by the Borrower or
any of its Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the period for which such
financial covenants or the Applicable Margin and the Applicable Facility Fee
Rate were calculated shall be deemed to have occurred on the first day of the
relevant period for which such financial covenants or the Applicable Margin and
the Applicable Facility Fee Rate were calculated on a pro forma basis acceptable
to the Agent.
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, the LC Issuer and the Agent on the other hand shall be
solely that of borrower and lender. Neither the Agent, the Arranger, the LC
Issuer nor any Lender shall have any fiduciary responsibilities to the Borrower.
Neither the Agent, the Arranger, the LC Issuer 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, the Arranger, the LC Issuer 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, the Arranger, the LC Issuer 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
47
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. The Agent, the LC Issuer and each Lender agree 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, the Agent and the LC Issuer 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 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. The Agent,
the LC Issuer and Lenders agree to give reasonable prior notice to the Borrower
of any disclosure pursuant to the foregoing clauses (iv) and (v) to the extent
feasible and so long as giving such notice is not otherwise prohibited by
applicable law.
9.12. Nonreliance. Each Lender hereby represents that it is not relying on
or looking to any Margin Stock for the repayment of the Credit Extensions
provided for herein.
9.13. Disclosure. The Borrower and each Lender hereby acknowledge and agree
that JPMCB 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.
9.14. USA PATRIOT Act. Each Lender that is subject to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the "Act") hereby notifies the Borrower that pursuant to the
requirements of the Act, it is required to obtain, verify and record information
that identifies the Borrower, which information includes the name and address of
the Borrower and other information that will allow such Lender to identify the
Borrower in accordance with the Act.
ARTICLE X
THE AGENT
10.1. Appointment; Nature of Relationship. JPMCB, 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 the term "secured party"
as defined in the Michigan 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
48
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 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
49
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, 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 Credit Extensions 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.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger, the LC Issuer
or any other Lender and based on the
50
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 Arranger, the LC Issuer 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 retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required Lenders shall have
the right to appoint one of the Lenders, 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, one of the Lenders as 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 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 of the
Agent, the resigning Agent shall be discharged from its duties and obligations
hereunder and under the Loan Documents. After the effectiveness of the
resignation 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
the Arranger, for their respective accounts, the fees agreed to by the Borrower,
the Agent and the Arranger 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. Co-Agents, Documentation Agent, Syndication Agent, etc. Neither any
of the Lenders identified in this Agreement or elsewhere as a "Syndication
Agent", a "Co-Agent" or a "Documentation 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
51
same acknowledgments with respect to such Lenders as it makes with respect to
the Agent in Section 10.11.
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 hereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Outstanding Credit Exposure (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 Aggregate Outstanding Credit Exposure held by the
other Lenders so that after such purchase each Lender will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. 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 respective Pro Rata Shares of the
Aggregate Outstanding Credit Exposure. 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 permitted hereby, except
that (i) the Borrower shall not have the right to assign its rights or
obligations under the Loan Documents without the prior written consent of each
Lender, (ii) any assignment by any Lender must be made in compliance with
Section 12.3, and (iii) any transfer by Participation must be made in compliance
with Section 12.2. Any attempted assignment or transfer by any party not made in
compliance with this Section 12.1 shall be null and void, unless such attempted
assignment or transfer is treated as a participation in accordance with Section
12.3.2. The parties to this Agreement acknowledge that clause (ii) of this
Section 12.1 relates only to absolute assignments and this Section 12.1 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
52
thereto have complied with the provisions of Section 12.3. The Agent may treat
the Person which made any Credit Extension 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 Credit
Extension or which holds any Note to direct payments relating to such Credit
Extension or Note to another Person. Any assignee of the rights to any Credit
Extension 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 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 Credit Extension (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 Credit
Extension.
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender may at any time
sell to one or more banks or other entities ("Participants") participating
interests in any Credit Extension 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 Credit Extensions
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 Credit Extension
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 Certain Provisions. 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. The Borrower
further agrees that each Participant shall be entitled to the benefits of
Sections 3.1, 3.2, 3.4 and 3.5 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to Section 12.3,
provided that (i) a Participant shall not be entitled to receive any
greater payment under Section 3.1, 3.2 or 3.5 than the Lender who sold the
participating interest to such Participant would have received had it
retained such interest for its own account, unless the sale of such
interest to such Participant is made with the prior written consent of the
Borrower, and (ii) any Participant not incorporated under the laws of the
United
53
States of America or any State thereof agrees to comply with the provisions
of Section 3.5 to the same extent as if it were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may 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 other form as may be
agreed to by the parties thereto. Each such assignment with respect to a
Purchaser which is not a Lender or an Affiliate of a Lender or an Approved
Fund shall either be in an amount equal to the entire applicable Commitment
and Credit Extensions of the assigning Lender or (unless each of the
Borrower and the Agent otherwise consents) be in an aggregate amount not
less than $10,000,000 or such lesser amount agreed to by the Agent. The
amount of the assignment shall be based on the Commitment or outstanding
Credit Extensions (if the Commitment has been terminated) subject to the
assignment, determined as of the date of such assignment or as of the
"Trade Date," if the "Trade Date" is specified in the assignment.
12.3.2. Consents. The consent of the Borrower shall be required prior
to an assignment becoming effective unless the Purchaser is a Lender, an
Affiliate of a Lender or an Approved Fund, provided that the consent of the
Borrower shall not be required if a Default has occurred and is continuing.
The consent of the Agent and the LC Issuer shall be required prior to an
assignment becoming effective unless the Purchaser is a Lender, an
Affiliate of a Lender or an Approved Fund. Any consent required under this
Section 12.3.2 shall not be unreasonably withheld or delayed.
12.3.3. Effect; Effective Date. Upon (i) delivery to the Agent of an
assignment, together with any consents required by Sections 12.3.1 and
12.3.2, and (ii) payment of a $3,500 fee to the Agent for processing such
assignment (unless such fee is waived by the Agent), 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 Credit Extensions 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 thereto, and the
transferor Lender shall be released with respect to the Commitment and
Credit Extensions assigned to such Purchaser without any further consent or
action by the Borrower, the Lenders or the Agent. In the case of an
assignment covering all of the assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a Lender hereunder but
shall continue to be entitled to the benefits of, and subject to, those
provisions of this Agreement and the other Loan Documents which survive
payment of the Obligations and termination of the applicable agreement. Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 12.3 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with Section 12.2. Upon the
consummation of any assignment to a Purchaser pursuant to this Section
12.3.3, 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
54
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.
12.3.4. Register. The Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments
of, and principal amounts of the Loans owing to, each Lender pursuant to
the terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive, and the Borrower, the Agent and the Lenders
may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from
time to time upon reasonable prior notice.
12.3.5. Special Purpose Funding Vehicles. (i) Notwithstanding anything
to the contrary contained herein, any Lender (a "Designating Lender") may
grant to one or more special purpose funding vehicles (each, an "SPV"),
identified as such in writing from time to time by the Designating Lender
to the Agent and the Borrower, the option to provide to the Borrower all or
any part of any Loan that such Designating Lender would otherwise be
obligated to make to the Borrower pursuant to this Agreement, provided that
(A) nothing herein shall constitute a commitment by any SPV to make any
Loan, (B) if any SPV elects not to exercise such option or otherwise fails
to provide all or any part of such Loan, the Designating Lender shall be
obligated to make such Loan pursuant to the terms hereof, (C) the
Designating Lender shall remain liable for any indemnity or other payment
obligation with respect to its Commitments hereunder and (D) the Borrower
shall not incur any additional costs or expenses as a result of any such
grant by a Designated Lender to an SPV. The making of a Loan by an SPV
hereunder shall utilize the relevant Commitment of the Designating Lender
to the same extent, and as if, such Loan were made by such Designating
Lender.
(ii) As to any Loans or portion thereof made by it, each SPV shall
have all the rights that a Lender making such Loans or portion thereof
would have had under this Agreement; provided, however, that each SPV shall
have granted to its Designating Lender an irrevocable power of attorney, to
deliver and receive all communications and notices under this Agreement
(and any related documents) and to exercise on such SPV's behalf, all of
such SPV's voting rights under this Agreement. No additional Note shall be
required to evidence the Loans or portion thereof made by an SPV; and the
related Designating Lender shall be deemed to hold its Note, if any, as
agent for such SPV to the extent of the Loans or portion thereof funded by
such SPV. In addition, any payments for the account of any SPV shall be
paid to its Designating Lender as agent for such SPV.
(iii) Each party hereto hereby agrees that no SPV shall be liable for
any indemnity or payment under this Agreement for which a Lender would
otherwise be liable. In furtherance of the foregoing, each party hereto
hereby agrees (which agreements shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior
indebtedness of any SPV, it will not institute against, or join any other
person in instituting against, such SPV any bankruptcy, reorganization,
arrangement insolvency or liquidation proceedings under the laws of the
United States or any State thereof.
55
(iv) In addition, subject to Section 12.4, any SPV may (A) at any time
and without paying any processing fee therefor, assign or participate all
or a portion of its interest in any Loans to the Designating Lender or to
any financial institutions providing liquidity and/or credit support to or
for the account of such SPV to support the funding or maintenance of Loans
and (B) disclose on a confidential basis any non-public information
relating to its Loans to any rating agency, commercial paper dealer or
provider of any surety, guarantee or credit or liquidity enhancements to
such SPV. This Section 12.3.3 may not be amended without the written
consent of any Designating Lender affected thereby.
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.
12.6. Tax Treatment. If any interest in any Loan Document is transferred to
any Transferee which is not incorporated under the laws of 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).
ARTICLE XIII
NOTICES
13.1. Notices.
(a) Notices Generally. Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in paragraph (b) below), all notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopier as
follows:
(i) if to the Borrower, at its address or telecopier number set
forth on the signature page hereof;
(ii) if to the Agent, at its address or telecopier number set
forth on the signature page hereof;
(iii) if to the LC Issuer, at its address or telecopier number
set forth on the signature page hereof;
(iv) if to a Lender, to it at its address (or telecopier number)
set forth in its Administrative Questionnaire.
Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient). Notices delivered
56
through electronic communications to the extent provided in paragraph (b) below,
shall be effective as provided in said paragraph (b).
(b) Electronic Communications. Notices and other communications to the
Lenders and the LC Issuer hereunder may be delivered or furnished by electronic
communication (including e-mail and internet or intranet websites) pursuant to
procedures approved by the Agent or as otherwise determined by the Agent,
provided that the foregoing shall not apply to notices to any Lender or the LC
Issuer pursuant to Article II if such Lender or the LC Issuer, as applicable,
has notified the Agent in writing that it is incapable of receiving notices
under such Article by electronic communication. The Agent or the Borrower may,
in its respective discretion, agree to accept notices and other communications
to it hereunder by electronic communications pursuant to procedures approved by
it or as it otherwise determines, provided that such determination or approval
may be limited to particular notices or communications.
Unless the Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender's receipt of an acknowledgement from the intended recipient (such as by
the "return receipt requested" function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not given during the normal business hours of the recipient, such notice or
communication shall be deemed to have been given at the opening of business on
the next Business Day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.
(c) Change of Address, Etc. Any party hereto may change its address or
telecopier number for notices and other communications hereunder by notice to
the other parties hereto.
ARTICLE XIV
COUNTERPARTS; EFFECTIVENESS; ELECTRONIC EXECUTION
14.1 Counterparts; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. Except as provided in Article IV, this
Agreement shall become effective when it shall have been executed by the Agent
and when the Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the parties hereto, and thereafter
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of a
manually executed counterpart of this Agreement.
14.2 Electronic Execution of Assignments. The words "execution," "signed,"
"signature," and words of like import in any assignment and assumption agreement
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, or any other state laws based on the Uniform Electronic
Transactions Act.
57
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 OF THE STATE OF MICHIGAN, 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 MICHIGAN STATE
COURT SITTING IN DETROIT, MICHIGAN IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN 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, THE LC ISSUER 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 DETROIT, MICHIGAN.
15.3. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, THE LC ISSUER 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.
58
IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuer and the Agent
have executed this Agreement as of the date first above written.
TECUMSEH PRODUCTS COMPANY
By: /s/ XXXXX X. XXXXXXXXX
------------------------------------
Title: Vice President, Treasurer and
Chief Financial Officer
000 Xxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx,
Vice President, Treasurer and Chief
Financial Officer
Telephone: 000-000-0000
Fax: 000-000-0000
59
Commitment:
$31,000,000 JPMORGAN CHASE BANK, N.A.,
as a Lender and as Agent and LC Issuer
By:
------------------------------------
Title:
---------------------------------
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Banking - Michigan
Group
Telephone: (000) 000-0000
Fax: (000) 000-0000
60
Commitment:
$31,000,000 COMERICA BANK,
as a Lender and as Syndication Agent
By:
------------------------------------
Title:
---------------------------------
61
Commitment:
$23,000,000 FIFTH THIRD BANK
By:
------------------------------------
Title:
---------------------------------
62
Commitment:
$15,000,000 THE NORTHERN TRUST COMPANY
By:
------------------------------------
Title:
---------------------------------
63
PRICING SCHEDULE
LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V
STATUS STATUS STATUS STATUS STATUS
-------- -------- --------- -------- ---------
Applicable Facility
Fee Rate 12.5 bps 15.0 bps 17.5 bps 20.0 bps 25.0 bps
-------- -------- -------- -------- ---------
Applicable Margin
- Eurodollar Rate Loans 37.5 bps 47.5 bps 70.0 bps 92.5 bps 125.0 bps
======== ======== ======== ======== =========
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
"Financials" means the annual or quarterly financial statements of the
Company delivered pursuant to the Credit Agreement.
"Level I Status" exists at any date if, on such date, the Leverage Ratio is
less than 1.00:1.
"Level II Status" exists at any date if, on such date, (i) the Company has
not qualified for Level I Status and (ii) the Leverage Ratio is less than
1.50:1.0.
"Level III Status" exists at any date if, on such date, (i) the Company has
not qualified for Level I Status or Level II Status and (ii) the Leverage Ratio
is less than 2.00:1.0.
"Level IV Status" exists at any date if, on such date, (i) the Company has
not qualified for Level I Status, Level II Status or Level III Status and (ii)
the Leverage Ratio is less than 2.50:1.0.
"Level V Status" exists at any date if, on such date, the Company has not
qualified for Level I Status, Level II Status, Level III Status or Level IV
Status.
"Status" means Level I Status, Level II Status, Level III Status, Level IV
Status or Level V Status.
The Applicable Margin and Applicable Facility Fee Rate shall be determined
in accordance with the foregoing table based on the Company's Status as
determined in the then most recent Financials. Adjustments, if any, to the
Applicable Margin and Applicable Facility Fee Rate shall be effective five
Business Days after the date the Company is required to deliver the applicable
Financials. If the Borrower fails to deliver the Financials to the Agent at the
time required pursuant to the Credit Agreement, then the Applicable Margin and
the Applicable Facility Fee Rate shall be the highest Applicable Margin and
Applicable Facility Fee Rate set forth in the foregoing table until five days
after such Financials are so delivered. Notwithstanding anything herein to the
contrary, the Applicable Margin and Applicable Facility Fee Rate shall be set at
Level IV as of the date hereof and shall be adjusted for the first time based on
the Financials for the fiscal year ending December 31, 2004.
64
EXHIBIT A
LENDER ADDITION AND ACKNOWLEDGEMENT AGREEMENT
Dated: ________, 200_
Reference is made to the Credit Agreement (as amended or modified from time
to time, the "Credit Agreement"), dated as of December 21, 2004, is among
Tecumseh Products Company, a Michigan corporation, the Lenders and JPMorgan
Chase Bank, N.A., a national banking association, as Agent. Capitalized terms
which are defined in the Credit Agreement and which are used herein without
definition shall have the same meanings herein as in the Credit Agreement.
The Borrower and _________________________________ (the "[New or Current]
Lender") agree as follows:
1. Subject to Section 2.23 of the Credit Agreement and this Lender Addition
and Acknowledgement Agreement, the Borrower hereby increases the Aggregate
Commitments from $__________ to $_____________ (such increase shall be in
increments of $10,000,000 and shall not cause the Aggregate Commitment to exceed
$150,000,000). This Lender Addition and Acknowledgement Agreement is entered
into pursuant to, and authorized by, Section 2.23 of the Credit Agreement.
2. The parties hereto acknowledge and agree that, as of the date hereof and
after giving effect to this Lender Addition and Acknowledgment Agreement, the
Aggregate Commitment and the Commitment of each Lender under the Credit
Agreement, including without limitation, the [New or Current] Lender, are set
forth on Annex 1 hereto.
3. [If requested by the Current Lender, the Current Lender attaches the
Notes delivered to it under the Credit Agreement and requests that the Borrower
exchange such Notes for new Notes in the amount of its revised Commitment] [If
requested by the New Lender, the New Lender requests that the Borrower issue
Notes in the amount of its Commitment.]
4. The [New or Current] Lender (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Lender Addition and Acknowledgment Agreement and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it satisfies the requirements, if any, specified in the Credit
Agreement that are required to be satisfied by it in order to execute and
perform this Lender Addition and Acknowledgment Agreement and become a Lender,
(iii) from and after the Closing Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent specified herein,
shall have the obligations of a Lender thereunder, (iv) it has received a copy
of the Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 6.1 thereof, as applicable, and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Lender Addition and
Acknowledgment Agreement on the basis of which it has made such analysis and
decision independently and without reliance on any Agent or any other Lender,
and (v) if it is a Non-U.S. Lender, attached to this Lender Addition and
Acknowledgment Agreement is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
it; and (b) agrees that (i) it will, independently and without reliance on any
Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking
65
action under the Loan Documents, and (ii) 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.
5. The effective date for this Lender Addition and Acknowledgement
Agreement shall be _______________ (the "Closing Date"). Following the execution
of this Lender Addition and Acknowledgement Agreement, it will be delivered to
the Agent for the consent of the Agent and acceptance and recording in the
Register.
6. Upon such consents, acceptance and recording, from and after the Closing
Date, the [New or Current] Lender shall be a party to the Credit Agreement and
the other Loan Documents to which Lenders are parties and to the extent provided
in this Lender Addition and Acknowledgement Agreement, have the rights and
obligations of a Lender under each such agreement.
7. Upon such consents, acceptance and recording, from and after the Closing
Date, the Agent shall make all payments in respect of the interest assigned
hereby (including payments of principal, interest, fees and other amounts) to
the [New or Current] Lender.
8. The Borrower represents and warrants to the Agent and the Lenders that
(a) no Default shall have occurred and be continuing hereunder as of the Closing
Date; and (b) the representations and warranties made by the Borrower and
contained in Article V of the Credit Agreement are true and correct on and as of
the Closing Date with the same effect as if made on and as of such date (other
than those representations and warranties that by their terms speak as of a
particular date, which representations and warranties shall be true and correct
as of such particular date).
9. Except as expressly amended hereby, the Borrower agrees that the Credit
Agreement and the other Loan Documents are ratified and confirmed and shall
remain in full force and effect, and that it has no set off, counterclaim, or
defense with respect to any of the foregoing.
10. This Lender Addition and Acknowledgment Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Lender Addition and Acknowledgment Agreement may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Lender Addition and Acknowledgment Agreement by telecopy shall be effective as
delivery of a manually executed counterpart of this Lender Addition and
Acknowledgment Agreement. This Lender Addition and Acknowledgment Agreement
shall be governed by, and construed in accordance with, the law of the State of
Michigan.
TECUMSEH PRODUCTS COMPANY
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[CURRENT LENDER OR NEW LENDER]
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
66
Acknowledged and Consented to:
JPMORGAN CHASE BANK, N.A., as Agent
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
67
Annex 1
Lenders and Commitments
(as of the Closing Date)
68
EXHIBIT B
NOTE
[Date]
Tecumseh Products Company, a Michigan corporation (the "Borrower"),
promises to pay to the order of ____________________________________ (the
"Lender") 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 its office of JPMorgan Chase Bank,
N.A. 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.
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, and the information so recorded shall be prima facie evidence
of the amount of each Loan and the date and amount of each principal payment
hereunder, and the information so recorded; provided, however, that the failure
of the Lender to record any such information or any error therein shall not in
any manner affect the obligation of the Borrower to repay the Obligations in
accordance with their terms.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Credit Agreement dated as of December 21, 2004 (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, the LC Issuer and JPMorgan Chase Bank, N.A., 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. This Note is guaranteed
pursuant to the Guaranties, all as more specifically described in the Agreement,
and reference is made thereto for a statement of the terms and provisions
thereof. The Borrower and each endorser or guarantor hereof waives demand,
presentment, protest, diligence, notice of dishonor and any other formality in
connection with this Note. Capitalized terms used herein and not otherwise
defined herein are used with the meanings attributed to them in the Agreement.
TECUMSEH PRODUCTS COMPANY
By:
------------------------------------
Print Name:
----------------------------
Title:
---------------------------------
69
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF ____________________,
DATED __________,
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
70
EXHIBIT C
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (the "Assignment and Assumption") is dated
as of the Effective Date set forth below and is entered into by and between
[Insert name of Assignor] (the "Assignor") and [Insert name of Assignee] (the
"Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
"Credit Agreement"), receipt of a copy of which is hereby acknowledged by the
Assignee. The Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Agent as contemplated below, the interest in and to all of the Assignor's
rights and obligations in its capacity as a Lender under the Credit Agreement
and any other documents or instruments delivered pursuant thereto that
represents the amount and percentage interest identified below of all of the
Assignor's outstanding rights and obligations under the respective facilities
identified below (including without limitation any letters of credit, guaranties
and swingline loans included in such facilities and, to the extent permitted to
be assigned under applicable law, all claims (including without limitation
contract claims, tort claims, malpractice claims, statutory claims and all other
claims at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
"Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor: __________________________________
2. Assignee: __________________________________ [and is an Affiliate/Approved
Fund of [identify Lender]
3. Borrower: Tecumseh Products Company
4. Agent: JPMorgan Chase Bank, N.A., as the agent under the Credit Agreement.
5. Credit Agreement: The Credit Agreement dated as of December 21, 2004 among
Tecumseh Products Company, the Lenders party thereto and JPMorgan Chase Bank,
N.A., as Agent and LC Issuer, and the other agents party thereto.
6. Assigned Interest:
Aggregate Amount of Amount of
Commitment/Loans for all Commitment/Loans Percentage Assigned of
Lenders* Assigned* Commitment/Loans(1)
------------------------ ---------------- ----------------------
$ $ ______%
71
7. Trade Date: __________________________________(2)
Effective Date: ____________________, 20__ [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
------------------------------------
Title:
---------------------------------
ASSIGNEE
[NAME OF ASSIGNEE]
By:
------------------------------------
Title:
---------------------------------
[Consented to and](5) Accepted:
JPMORGAN CHASE BANK, N.A., as Agent and LC Issuer
By:
---------------------------------
Title:
------------------------------
[Consented to:](4)
TECUMSEH PRODUCTS COMPANY
By:
---------------------------------
Title:
------------------------------
* Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.
(1) Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.
(2) Insert if satisfaction of minimum amounts is to be determined as of the
Trade Date.
(3) To be added only if the consent of the Agent is required by the terms of
the Credit Agreement.
(4) To be added only if the consent of the Borrower is required by the terms of
the Credit Agreement.
72
ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby. Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) any statements,
warranties or representations made in or in connection with the Credit Agreement
or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency, perfection, priority, collectibility,
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document, (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document, (v)
inspecting any of the property, books or records of the Borrower, or any
guarantor, or (vi) any mistake, error of judgment, or action taken or omitted to
be taken in connection with the Loans or the Loan Documents.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) from
and after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of the Assigned Interest,
shall have the obligations of a Lender thereunder, (iii) agrees that its payment
instructions and notice instructions are as set forth in Schedule 1 to this
Assignment and Assumption, (iv) 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,
(v) 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 and Assumption, (vi) it has received a copy of the Credit Agreement,
together with copies of financial statements and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest on the basis of which it has made such analysis and decision
independently and without reliance on the Agent or any other Lender, and (vii)
attached as Schedule 1 to this Assignment and Assumption is any documentation
required to be delivered by the Assignee with respect to its tax status pursuant
to the terms of the Credit Agreement, duly completed and executed by the
Assignee and (b) agrees that (i) it will, independently and without reliance on
the Agent, the Assignor or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Loan Documents, and
(ii) 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.
2. Payments. The Assignee shall pay the Assignor, on the Effective
Date, the amount agreed to by the Assignor and the Assignee. From and after the
Effective Date, the Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other
73
amounts) to the Assignor for amounts which have accrued to but excluding the
Effective Date and to the Assignee for amounts which have accrued from and after
the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in any
number of counterparts, which together shall constitute one instrument. Delivery
of an executed counterpart of a signature page of this Assignment and Assumption
by telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of Michigan.
74
ADMINISTRATIVE QUESTIONNAIRE
75
EXHIBIT D
FORM OF OPINION
____________,
The Agent, the LC Issuer and the Lenders who are parties to the Credit Agreement
described below.
Gentlemen/Ladies:
We are counsel for _____________ (the "Borrower"), and have represented the
Borrower in connection with its execution and delivery of a Credit Agreement
dated as of __________ (the "Agreement") among the Borrower, the Lenders named
therein, and JPMorgan Chase Bank, N.A., as Agent and LC Issuer. All capitalized
terms used in this opinion and not otherwise defined herein shall have the
meanings attributed to them in the Agreement.
We have examined the Borrower's **[describe constitutive documents of
Borrower and appropriate evidence of authority to enter into the transaction]**,
the Loan Documents and such other matters of fact and law which we deem
necessary in order to render this opinion. Based upon the foregoing, it is our
opinion that:
1. Each of the Borrower and its Subsidiaries is a corporation, partnership
or limited liability company duly and properly incorporated or organized, as the
case may be, validly existing and (to the extent such concept applies to such
entity) in good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.
2. The execution and delivery by the Borrower and each Guarantor of the
Loan Documents to which they are a party and the performance by the Borrower and
each Guarantor of their obligations thereunder have been duly authorized by
proper corporate proceedings on the part of the Borrower and each Guarantor and
will not:
(a) require any consent of the Borrower's or any Guarantor's
shareholders or members (other than any such consent as has already been
given and remains in full force and effect);
(b) violate (i) any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower or any of its
Subsidiaries or (ii) the Borrower's or any Subsidiary's articles or
certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, by-laws, or operating
or other management agreement, as the case may be, or (iii) 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
76
(c) result in, or require, the creation or imposition of any Lien in,
of or on the Property of the Borrower or a Subsidiary pursuant to the terms
of any indenture, instrument or agreement binding upon the Borrower or any
of its Subsidiaries.
3. The Loan Documents to which they are a party have been duly executed and
delivered by the Borrower and each Guarantor and constitute legal, valid and
binding obligations of the Borrower and each Guarantor enforceable against the
Borrower and each Guarantor in accordance with their terms except to the extent
the enforcement thereof may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and subject also to the
availability of equitable remedies if equitable remedies are sought.
4. There is no litigation, arbitration, governmental investigation,
proceeding or inquiry pending or, to the best of our knowledge after due
inquiry, threatened against the Borrower or any of its Subsidiaries which, if
adversely determined, could reasonably be expected to have a Material Adverse
Effect.
5. No order, consent, adjudication, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by, or
other action in respect of any governmental or public body or authority, or any
subdivision thereof, which has not been obtained by the Borrower or any of its
Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under the Agreement, the payment and performance by
the Borrower of the Obligations, or the legality, validity, binding effect or
enforceability of any of the Loan Documents.
This opinion may be relied upon by the Agent, the LC Issuer the
Lenders and their participants, assignees and other transferees.
Very truly yours,
77
EXHIBIT E
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To JPMorgan Chase Bank, N.A.,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Credit Agreement, dated December 21, 2004 (as the same may be amended or
modified, the "Credit Agreement"), among Tecumseh Products Company (the
"Borrower"), the Lenders named therein, the LC Issuer 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 2.15 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
78
EXHIBIT F
COMPLIANCE CERTIFICATE
To: The Agent, the LC Issuer and the Lenders parties to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain Credit
Agreement dated as of December 21, 2004 (as amended, modified, renewed or
extended from time to time, the "Agreement") among the Tecumseh Products Company
(the "Borrower"), the lenders party thereto and JPMorgan Chase Bank, N.A., as
Agent for the Lenders and as LC Issuer. 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.
5. Schedule II hereto sets forth the determination of the interest rates to
be paid for Advances and the facility fee rates commencing on the fifth day
following the delivery hereof.
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:
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
79
The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this __ day of
______, ___.
__________________________
80
SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of _________, ____ with
Provisions of Section 6.19 of
the Agreement
81
SCHEDULE II TO COMPLIANCE CERTIFICATE
Borrower's Applicable Margin Calculation
82
SCHEDULE 1
SUBSIDIARIES AND OTHER INVESTMENTS
(SEE SECTIONS 5.8 AND 6.14)
Investment Jurisdiction of Owned Amount of Percent
In Organization By Investment Ownership
---------- --------------- ----- ---------- ---------
83
SCHEDULE 2
INDEBTEDNESS AND LIENS
(SEE SECTIONS 5.14, 6.11 AND 6.15)
Maturity
Indebtedness Indebtedness Property and Amount
Incurred By Owed To Encumbered (If Any) of Indebtedness
------------ ------------ ------------------- ---------------
84
SCHEDULE 5.7
LITIGATION
85
CREDIT AGREEMENT
DATED AS OF DECEMBER 21, 2004
AMONG
TECUMSEH PRODUCTS COMPANY,
THE LENDERS AND LC ISSUER,
JPMORGAN CHASE BANK, N.A.,
AS AGENT
X.X. XXXXXX SECURITIES, INC.
AS LEAD ARRANGER AND SOLE BOOK RUNNER
COMERICA BANK
AS SYNDICATION AGENT
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS................................................... 1
ARTICLE II. THE CREDITS................................................... 15
2.1. Commitment................................................. 15
2.2. Required Payments; Termination............................. 15
2.3. Ratable Loans.............................................. 15
2.4. Types of Advances.......................................... 15
2.5 Swing Line Loans........................................... 15
2.6. Facility Fees.............................................. 16
2.7. Minimum Amount of Each Advance............................. 17
2.8. Optional Principal Payments................................ 17
2.9. Method of Selecting Types and Interest Periods for New
Advances................................................ 17
2.10. Conversion and Continuation of Outstanding Advances........ 17
2.11. Changes in Interest Rate, etc.............................. 18
2.12. Rates Applicable After Default............................. 18
2.13. Method of Payment.......................................... 19
2.14. Noteless Agreement; Evidence of Indebtedness............... 19
2.15. Telephonic Notices......................................... 19
2.16. Interest Payment Dates; Interest and Fee Basis............. 20
2.17. Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions................................... 20
2.18. Lending Installations...................................... 20
2.19. Facility LCs............................................... 20
2.20. Non-Receipt of Funds by the Agent.......................... 24
2.21. Replacement of Lender...................................... 24
2.21. Replacement of Lender...................................... 25
2.21. Replacement of Lender...................................... 25
ARTICLE III. YIELD PROTECTION; TAXES....................................... 26
3.1. Yield Protection........................................... 26
3.2. Changes in Capital Adequacy Regulations.................... 27
3.3. Availability of Types of Advances.......................... 27
3.4. Funding Indemnification.................................... 27
3.5. Taxes...................................................... 28
3.6. Lender Statements; Survival of Indemnity................... 29
ARTICLE IV. CONDITIONS PRECEDENT.......................................... 30
4.1. Initial Credit Extension................................... 30
4.2 Each Credit Extension...................................... 31
ARTICLE V. REPRESENTATIONS AND WARRANTIES................................ 32
5.1. Existence and Standing..................................... 32
5.2. Authorization and Validity................................. 32
5.3. No Conflict; Government Consent............................ 32
5.4. Financial Statements....................................... 32
i
5.5. Material Adverse Change.................................... 32
5.6. Taxes...................................................... 33
5.7. Litigation and Contingent Obligations...................... 33
5.8. Subsidiaries............................................... 33
5.9. ERISA...................................................... 33
5.10. Accuracy of Information.................................... 33
5.11. Regulations T, U and X..................................... 33
5.12. Material Agreements........................................ 34
5.13. Compliance With Laws....................................... 34
5.14. Ownership of Properties.................................... 34
5.15. Plan Assets; Prohibited Transactions....................... 34
5.16. Environmental Matters...................................... 34
5.17. Investment Company Act..................................... 34
5.18. Public Utility Holding Company Act......................... 34
5.19. Solvency................................................... 35
ARTICLE VI. COVENANTS..................................................... 35
6.1. Financial Reporting........................................ 35
6.2. Use of Proceeds; FASCO Acquisition Documents............... 36
6.3. Notice of Default.......................................... 37
6.4. Conduct of Business........................................ 37
6.5. Taxes...................................................... 37
6.6. Insurance.................................................. 37
6.7. Compliance with Laws....................................... 37
6.8. Maintenance of Properties.................................. 37
6.9. Inspection................................................. 37
6.10. Dividends.................................................. 37
6.11. Non-Guarantor Indebtedness................................. 38
6.12. Merger..................................................... 38
6.13. Sale of Assets............................................. 38
6.14. Investments and Acquisitions............................... 39
6.15. Liens...................................................... 40
6.16. Affiliates................................................. 40
6.17 Limitation on Restrictions on Subsidiary Distributions..... 40
6.18 Financial Contracts........................................ 41
6.19. Financial Covenants........................................ 41
6.20. Additional Covenants....................................... 41
ARTICLE VII. DEFAULTS...................................................... 42
ARTICLE VIII. ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES................ 44
8.1. Acceleration; Facility LC Collateral Account............... 44
8.2. Amendments................................................. 45
8.3. Preservation of Rights..................................... 45
ARTICLE IX. GENERAL PROVISIONS............................................ 46
9.1. Survival of Representations................................ 46
9.2. Governmental Regulation.................................... 46
9.3. Headings................................................... 46
9.4. Entire Agreement........................................... 46
9.5. Several Obligations; Benefits of this Agreement............ 46
9.6. Expenses; Indemnification.................................. 46
9.7. Numbers of Documents....................................... 47
ii
9.8. Accounting................................................. 47
9.9. Severability of Provisions................................. 47
9.10. Nonliability of Lenders.................................... 47
9.11. Confidentiality............................................ 48
9.12. Nonreliance................................................ 48
9.13. Disclosure................................................. 48
ARTICLE X. THE AGENT..................................................... 48
10.1. Appointment; Nature of Relationship........................ 48
10.2. Powers..................................................... 49
10.3. General Immunity........................................... 49
10.4. No Responsibility for Loans, Recitals, etc................. 49
10.5. Action on Instructions of Lenders.......................... 49
10.6. Employment of Agents and Counsel........................... 49
10.7. Reliance on Documents; Counsel............................. 50
10.8. Agent's Reimbursement and Indemnification.................. 50
10.9. Notice of Default.......................................... 50
10.10. Rights as a Lender......................................... 50
10.11. Lender Credit Decision..................................... 50
10.12. Successor Agent............................................ 51
10.13. Agent and Arranger Fees.................................... 51
10.14. Delegation to Affiliates................................... 51
10.17. Co-Agents, Documentation Agent, Syndication Agent, etc..... 51
ARTICLE XI. SETOFF; RATABLE PAYMENTS...................................... 52
11.1. Setoff..................................................... 52
11.2. Ratable Payments........................................... 52
ARTICLE XII. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS............. 52
12.1. Successors and Assigns..................................... 52
12.2. Participations............................................. 53
12.3. Assignments................................................ 54
12.4. Dissemination of Information............................... 56
12.5. Tax Treatment.............................................. 56
ARTICLE XIII. NOTICES....................................................... 56
13.1. Notices.................................................... 56
ARTICLE XIV. COUNTERPARTS; EFFECTIVENESS; ELECTRONIC EXECUTION............. 57
14.1. Counterparts; Effectiveness................................ 57
14.2. Electronic Execution of Assignments........................ 57
ARTICLE XV. CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY
TRIAL...................................................... 58
15.1. CHOICE OF LAW.............................................. 58
15.2. CONSENT TO JURISDICTION.................................... 58
15.3. WAIVER OF JURY TRIAL....................................... 58
EXHIBIT E. NOTE.......................................................... 69
EXHIBIT A. FORM OF OPINION............................................... 76
EXHIBIT D. LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION................ 78
EXHIBIT B. COMPLIANCE CERTIFICATE........................................ 79
SCHEDULE 1. SUBSIDIARIES AND OTHER INVESTMENTS............................ 83
SCHEDULE 2. INDEBTEDNESS AND LIENS........................................ 84
SCHEDULE 5.7. LITIGATION.................................................... 85
iii
