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EXHIBIT 99.1
EXECUTION COPY
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THREE YEAR CREDIT AGREEMENT
DATED AS OF OCTOBER 7, 0000
XXXXX
XXXXX XXXXXXXXXXX,
XXXX XX XXXXXXX NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS DOCUMENTATION AGENT,
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
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$1,465,000,000
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Page
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1.01 Defined Terms................................................... 1
1.02 Other Definitional Provisions................................... 15
(a) Defined Terms.............................................. 15
(b) The Agreement.............................................. 15
(c) Certain Common Terms....................................... 15
(d) Performance; Time.......................................... 16
(e) Contracts.................................................. 16
(f) Laws....................................................... 16
(g) Captions................................................... 16
1.03 Accounting Principles........................................... 16
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments................................ 16
2.02 Loan Accounts; Notes............................................ 17
2.03 Procedure for Committed Borrowings.............................. 18
2.04 Conversion and Continuation Elections for
Committed Borrowings............................................ 19
2.05 Competitive Bid Borrowings...................................... 21
2.06 Procedure for Competitive Bid Borrowings........................ 21
2.07 Voluntary Termination or Reduction of Commitments............... 26
2.08 Optional Prepayments of Committed Loans......................... 26
2.09 Repayment....................................................... 27
(a) The Committed Loans........................................ 27
(b) The Competitive Bid Loans.................................. 27
2.10 Interest........................................................ 27
2.11 Fees............................................................ 28
(a) Facility Fee............................................... 28
(b) Syndication Fees........................................... 29
(c) Administration Fees........................................ 29
2.12 Computation of Fees and Interest................................ 29
2.13 Payments by the Company......................................... 30
2.14 Payments by the Banks to the Documentation Agent................ 31
2.15 Sharing of Payments, Etc........................................ 32
2.16 Amount and Terms of Letters of Credit........................... 33
(a) Letter of Credit Commitments; Terms of
Letters of Credit.......................................... 33
(b) Procedure for Issuance of Letters of Credit................ 34
(c) Draws upon Letters of Credit; Reimbursement
Obligations................................................ 34
(d) Banks; Participation in Letters of Credit.................. 35
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(e) Interest and Fees for Letters of Credit................... 36
(f) LC Obligations Unconditional.............................. 37
(g) Indemnification........................................... 38
(h) Stated Amount............................................. 39
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.......................................................... 39
3.02 Inability to Determine Rates................................... 42
3.03 Increased Costs; Capital Adequacy.............................. 43
3.04 Illegality..................................................... 44
3.05 Funding Losses................................................. 45
3.06 Survival....................................................... 45
ARTICLE IV
CONDITIONS PRECEDENT
4.01 Conditions to Occurrence of the Closing Date and
Effectiveness of this Agreement................................ 45
(a) Credit Agreement.......................................... 46
(b) By-laws; Resolutions; Incumbency.......................... 46
(c) Articles of Incorporation................................. 46
(d) Legal Opinions............................................ 46
(e) Payment of Transaction Fees and Expenses.................. 46
(f) Certificate............................................... 47
(g) Financial Statements...................................... 47
(h) Other Credit Facilities................................... 47
(i) Other Documents........................................... 47
4.02 Conditions to All Borrowings and Letter of Credit
Issuances...................................................... 47
(a) Notice of Borrowing or Issuance........................... 47
(b) Continuation of Representations and
Warranties................................................ 48
(c) No Existing Default....................................... 48
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.01 Organization and Good Standing................................. 48
5.02 Authorization; No Contravention................................ 48
5.03 Consents and Approvals......................................... 48
5.04 Binding Effect................................................. 49
5.05 Litigation..................................................... 49
5.06 Financial Statements........................................... 49
5.07 Use of Proceeds; Margin Regulations............................ 49
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5.08 No Default..................................................... 50
5.09 Taxes.......................................................... 50
5.10 Insurance...................................................... 50
5.11 Compliance With Laws........................................... 50
ARTICLE VI
AFFIRMATIVE COVENANTS
6.01 Payment of Taxes............................................... 50
6.02 Insurance...................................................... 50
6.03 Preservation of Corporate Existence, Etc....................... 50
6.04 Maintenance of Property........................................ 51
6.05 Compliance with Laws........................................... 51
6.06 Books and Records; Other Information........................... 51
6.07 Financial Information.......................................... 51
6.08 Notices........................................................ 52
ARTICLE VII
NEGATIVE COVENANTS
7.01 Consolidations and Mergers..................................... 53
7.02 Disposition of Assets.......................................... 53
7.03 Limitation on Liens............................................ 54
7.04 EBITDAR Coverage Ratio......................................... 55
7.05 Consolidated Net Worth......................................... 55
ARTICLE VIII
EVENTS OF DEFAULT
8.01 Event of Default............................................... 55
(a) Non-Payment of Principal.................................. 55
(b) Non-Payment of Interest or Fees........................... 55
(c) Specific Defaults......................................... 55
(d) Other Defaults............................................ 55
(e) Representation or Warranty................................ 56
(f) Cross-Acceleration........................................ 56
(g) ERISA..................................................... 56
(h) Monetary Judgments........................................ 56
(i) Insolvency; Voluntary Proceedings......................... 56
(j) Involuntary Proceedings................................... 57
8.02 Remedies....................................................... 57
8.03 Rights Not Exclusive........................................... 58
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ARTICLE IX
THE DOCUMENTATION AGENT
9.01 Appointment and Authorization................................. 58
9.02 Delegation of Duties.......................................... 59
9.03 Liability of Agent-Related Persons............................ 59
9.04 Reliance by Documentation Agent............................... 59
9.05 Notice of Default............................................. 60
9.06 Credit Decision............................................... 60
9.07 Indemnification............................................... 61
9.08 Documentation Agent in Individual Capacity.................... 62
9.09 Successor Documentation Agent................................. 62
9.10 Withholding Tax............................................... 63
ARTICLE X
MISCELLANEOUS
10.01 Amendments and Waivers........................................ 64
10.02 Notices....................................................... 65
10.03 No Waiver..................................................... 66
10.04 Costs and Expenses............................................ 66
10.05 Indemnity..................................................... 67
10.06 Marshalling; Payments Set Aside............................... 67
10.07 Successors and Assigns........................................ 67
10.08 Assignments, Participations, Etc.............................. 68
10.09 Set-off....................................................... 70
10.10 Notification of Addresses, Lending Offices, Etc............... 71
10.11 Counterparts.................................................. 71
10.12 Severability.................................................. 71
10.13 No Third Parties Benefited.................................... 71
10.14 Governing Law and Jurisdiction................................ 71
10.15 Waiver of Jury Trial.......................................... 72
10.16 Entire Agreement.............................................. 72
10.17 Termination of Existing Facilities............................ 73
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SCHEDULES
Schedule 1.01 Existing Facilities
Schedule 2.01 Commitments; Lending Offices
Schedule 5.03 Consents and Approvals
Schedule 7.03 Liens
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Committed Loan Note
Exhibit D Form of Competitive Bid Note
Exhibit E Form of Competitive Bid Request
Exhibit F Form of Invitation for Competitive Bids
Exhibit G Form of Competitive Bid
Exhibit H-1 Form of Opinion of Counsel to the Company
Exhibit H-2 Form of Opinion of Special Counsel to the
Company
Exhibit I Form of Assignment and Assumption Agreement
Exhibit J Form of Letter of Credit Request
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THREE YEAR CREDIT AGREEMENT
This THREE YEAR CREDIT AGREEMENT is entered into as of October 7, 1994,
among KMART CORPORATION, a Michigan corporation (the "Company"), the several
financial institutions party to this Agreement (collectively, the "Banks";
individually, a "Bank") and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Documentation Agent.
WHEREAS, the Banks have agreed to make available to the Company a
revolving credit facility upon the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.01 Defined Terms. In addition to the terms defined elsewhere in this
Agreement, the following terms have the following meanings:
"Absolute Rate" has the meaning specified in Section 2.06(c)(ii)(D).
"Absolute Rate Auction" means a solicitation of Competitive Bids
setting forth Absolute Rates pursuant to Section 2.06.
"Absolute Rate Bid Loan" means any Competitive Bid Loan that bears
interest at a rate determined with reference to an Absolute Rate.
"Affiliate" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, by contract or otherwise. In no
event shall any Bank be deemed an "Affiliate" of the Company or any Subsidiary
of the Company.
"Agent-Related Persons" means BofA and any successor agent under
Section 9.09, together with their respective Affiliates (including, in the case
of BofA, BA Securities, Inc.) and the officers, directors, employees, agents
and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Commitment" means the sum of the Commitments of the Banks,
in the initial amount of One Billion Four Hundred Sixty Five
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Million Dollars ($1,465,000,000), as such amount may be reduced from time to
time pursuant to this Agreement.
"Agreement" means this Credit Agreement, as amended, restated,
supplemented or modified from time to time.
"Arrangers" means Bankers Trust Company and BA Securities, Inc.
"Assignee" has the meaning specified in Section 10.08(a).
"Assignment and Acceptance" has the meaning specified in Section
10.08(a).
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the reasonable
allocated cost of internal legal services and all reasonable disbursements of
internal counsel.
"Bank" and "Banks" means any or all, as the case may be, of the banks
listed in Schedule 2.01 hereof and any entity which becomes a Bank pursuant to
Section 10.08.
"Bank Affiliate" means a Person engaged primarily in the business of
commercial banking that is an Affiliate of a Bank and (i) is organized under
the laws of the United States, or any state thereof, or (ii) is organized under
the laws of any other country which is a member of the Organization for
Economic Cooperation and Development, or a political subdivision of any such
country, and is acting through a branch or agency located in the United States.
"BofA" means Bank of America National Trust and Savings Association, a
national banking association.
"Borrowing" means a borrowing hereunder, consisting of Loans of the
same Type made to the Company on the same day by the Banks pursuant to Article
II, and may be a Competitive Bid Borrowing or a Committed Borrowing.
"Borrowing Date" means a date on which a Borrowing is made or a Letter
of Credit is issued hereunder.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in New York City or San Francisco are authorized or
required by law to close and, if the applicable Business Day relates to any
LIBOR Loan, means such a day on which dealings in Dollars are carried on in the
London interbank market.
"Capital Adequacy Regulation" means any guideline, request or directive
of any central bank or other Governmental Authority, or
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and other law, rule or regulation, whether or not having the force of law, in
each case, regarding capital adequacy of any Bank.
"CD Rate" means the arithmetic average (rounded upward to the nearest
1/100th of 1%) of the sum of (x) the consensus bid rates determined by each
Reference Bank as the bid rates per annum, at 10:00 a.m. (New York City time)
on the first day of the Interest Period to be applicable, of two or more New
York or Chicago, as the case may be, certificate of deposit dealers of
recognized standing selected by such Reference Bank in New York or Chicago, as
the case may be, for certificates of deposit of such Reference Bank in an
amount approximately comparable to the principal amount of the CD Rate
Committed Loan for such Reference Bank and with a maturity equal to the
Interest Period applicable to such CD Rate Committed Loan; provided, that if
any Reference Bank fails to provide the Documentation Agent with its aforesaid
rate, then the CD Rate shall equal the arithmetic average of the rates provided
to the Documentation Agent by the other Reference Bank or Banks, such average
rate to be grossed up for the maximum cost of reserves applicable to
certificates of deposit under Regulation D of the Federal Reserve Board by
dividing the same by a percentage equal to 100% minus the maximum rate of all
reserve requirements (expressed as a percentage) as specified in Regulation D
(including any marginal, emergency, supplemental, special or other reserves)
that for the date the CD Rate is being determined would be applicable during
the Interest Period to a negotiable certificate of deposit of such Reference
Bank in excess of $100,000 and with a maturity period equal to such Interest
period, plus (y) the then daily net annual assessment payable to the Federal
Deposit Insurance Corporation for insuring such Certificate of Deposit by a
member of the Bank Insurance Fund that is classified as adequately capitalized
and within supervisory sub-group "A" (or a comparable successor assessment risk
classification within the meaning of 12 C.F.R. Section 327.3(d)).
"CD Rate Committed Loan" means any Committed Loan that bears interest
at a rate determined with reference to the CD Rate.
"Closing Date" means the date on which all conditions precedent set
forth in Section 4.01 are satisfied or waived by all Banks.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and any regulations promulgated thereunder.
"Commitment" has the meaning specified in Section 2.01 with respect to
each Bank.
"Commitment Percentage" means, as to any Bank, the percentage
equivalent of such Bank's Commitment divided by the Aggregate Commitment.
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"Committed Borrowing" means a borrowing consisting of Committed Loans
made on the same day by the Banks ratably according to their respective
Commitment Percentages and, in the case of LIBOR Committed Loans or CD
Committed Loans, having the same Interest Period.
"Committed Loan" means a Loan under Section 2.01, and may be a LIBOR
Committed Loan, a CD Rate Committed Loan or a Reference Rate Committed Loan.
"Committed Loan Notes" means those promissory notes of the Company to
the order of each of the Banks, substantially in the form of Exhibit C.
"Competitive Bid" means an offer by a Bank to make a Competitive Bid
Loan pursuant to Section 2.06(c).
"Competitive Bid Borrowing" means a Borrowing hereunder consisting of
one or more Competitive Bid Loans made to the Company on the same day by one or
more Banks.
"Competitive Bid Commitment Sublimit" means an aggregate amount equal
to Five Hundred Million Dollars ($500,000,000).
"Competitive Bid Loan" means a Loan by a Bank to the Company under
Section 2.06, which may be a LIBOR Bid Loan or an Absolute Rate Bid Loan.
"Competitive Bid Loan Lender" means in respect of any Competitive Bid
Loan, the Bank making such Competitive Bid Loan.
"Competitive Bid Notes" means those master promissory notes of the
Company to the order of each of the Banks, substantially in the form of Exhibit
D.
"Competitive Bid Request" means a notice by the Company requesting the
Banks to make Competitive Bids, given in the form of Exhibit E.
"Consolidated Net Worth" means as of the date of any determination
thereof, the consolidated net worth of the Company, determined in accordance
with GAAP; provided, however, that any gains or losses from the disposition of
any Specialty Retail Subsidiary and any changes after the Closing Date in the
foreign currency translation adjustment account as presented in the Company's
financial statements (and in accordance with GAAP) shall be excluded from the
determination of Consolidated Net Worth.
"Continuation Date" has the meaning set forth in Section 2.04(a).
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"Contract Documents" has the meaning specified in Section 10.05.
"Controlled Group" means the Company and all Persons (whether or not
incorporated) under common control or treated as a single employer with the
Company pursuant to Sections 414(b), (c), (m) or (o) of the Code.
"Conversion Date" means any date on which the Company elects to convert
one Type of Committed Loan to another Type of Committed Loan.
"Debt Rating" means the rating assigned to the Company's senior
unsecured debt as publicly announced by Xxxxx'x or S&P, as the case may be.
"Dollars", "dollars" and "$" each mean lawful money of the United
States.
"Documentation Agent" means BofA in its capacity as documentation agent
for the Banks hereunder, and any successor agent in such capacity.
"EBITDAR" means, for any applicable period, for the Company the
aggregate of the following, without duplication: (a) consolidated net income
for such period, plus (b) consolidated interest expense (net of any interest
income) for such period, plus (c) consolidated provision for taxes for such
period, plus (d) consolidated depreciation expense for such period, plus (e)
consolidated amortization expense for such period, plus (f) consolidated Rent
Expenses for such period, minus (or plus, as applicable) (g) on a consolidated
basis, any extraordinary gains (or plus extraordinary losses) for such period,
minus (or plus, as applicable) (h) any gains (or plus any losses) attributable
to the Specialty Retail Subsidiaries for such period other than results of
operations in the ordinary course of business, plus (i) solely with respect to
the four fiscal quarters ending in October 1994, the $1.348 billion
restructuring charge recorded in the fourth fiscal quarter of the Company's
fiscal year ending January 26, 1994.
"Eligible Assignee" means (i) a commercial bank or other financial
institution organized under the laws of the United States, or any state
thereof, and having a combined capital and surplus of at least One Hundred
Million Dollars ($100,000,000); (ii) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development, or a political subdivision of any such country,
and having a combined capital and surplus of at least One Hundred Million
Dollars ($100,000,000), provided that such bank is acting through a branch or
agency located in the United States; and (iii) any Bank Affiliate.
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"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any regulations promulgated thereunder.
"Event of Default" means any of the events or circumstances specified
in Section 8.01.
"Existing Facilities" means the bilateral lines of credit with the
institutions and in the amounts set forth on Schedule 1.01.
"Facing Agent" has the meaning specified in Section 2.16(a)(i).
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the preceding Business Day) in the
weekly statistical release designated as H.15 (519), or any successor
publication, by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average of the quotations
for such day on such transactions received by the Documentation Agent from
three (3) Federal funds brokers of recognized standing selected by the
Documentation Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System or any successor thereof.
"Form 1001" has the meaning specified in Section 9.10(a)(i).
"Form 4224" has the meaning specified in Section 9.10(a)(ii).
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be in general use by significant segments of the U.S.
accounting profession, which are applicable to the circumstances as of the date
of determination.
"Government Acts" has the meaning specified in Section 2.16(g).
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, or any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to
government.
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"Guaranty Obligation" means, as applied to any Person, any obligation,
direct or indirect, of that Person guaranteeing any Indebtedness of any other
Person, and, without limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person:
(i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness (whether arising by
agreement to keep-well, to purchase assets, goods, securities or
services, to take-or-pay, or to maintain financial statement
conditions or otherwise); or
(ii) entered into for the purpose of assuring in any other
manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in
part);
provided, that the term Guaranty Obligation shall not include:
(a) endorsements for collection or deposit in the ordinary
course of business;
(b) obligations that are not required in accordance with GAAP
to be included in the financial statements of such Person or the
footnotes thereto; or
(c) "unconditional purchase obligations" (including
take-or-pay contracts) as defined in and as required to be disclosed
pursuant to Statement of Financial Accounting Standards No. 47 and the
related interpretations, as the same may be amended from time to time.
"Indebtedness" of any Person means at any date without duplication,
(a) all obligations of such Person for borrowed money;
(b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments;
(c) all obligations of such Person to pay the deferred purchase
price of property or services, except trade accounts payable and other
expenses and accounts payable arising in the ordinary course of
business;
(d) all reimbursement obligations with respect to letters of
credit (other than the Letters of Credit and the LC Obligations) and
bankers' acceptances except ordinary trade credits;
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(e) all Indebtedness of others secured by a Lien on any asset
of such Person whether or not such Indebtedness is assumed by such
Person;
(f) all obligations (to the extent capitalized for accounting
purposes) of such Person as lessee under any lease of any
property by that Person as lessee which, in conformity with GAAP, is
accounted for as a capital lease on the balance sheet of that Person;
and
(g) all Guaranty Obligations of such Person.
"Indemnified Person" has the meaning specified in Section 10.05.
"Insolvency Proceeding" means (a) any case, action or proceeding before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution, winding-up
or relief of debtors, or (b) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors or other, similar
arrangement in respect of its creditors generally or any substantial portion of
its creditors; in each case (a) and (b) undertaken under U.S. Federal, State or
foreign law.
"Interest Payment Date" means, with respect to any LIBOR Loan, Absolute
Rate Bid Loan or CD Rate Committed Loan, the last day of each Interest Period
applicable to such Loan, and, with respect to any Reference Rate Committed
Loan, the last Business Day of each calendar quarter and the Termination Date;
provided, that if any Interest Period for a LIBOR Loan (other than a LIBOR Bid
Loan) exceeds three months, the date which falls three months after the
beginning of such Interest Period shall also be an Interest Payment Date.
"Interest Period" means: (a) with respect to any LIBOR Loan, the period
commencing on the Business Day the LIBOR Loan is disbursed or continued (or on
the Conversion Date on which any Loan is converted to a LIBOR Committed Loan)
and ending on the date one, two, three or six months thereafter, as selected by
the Company in its Notice of Borrowing, Competitive Bid Request or Notice of
Conversion/Continuation; (b) with respect to any CD Rate Committed Loan, the
period commencing on the Business Day the CD Rate Committed Loan is disbursed
or continued (or on the Conversion Date on which any Loan is converted to a CD
Rate Committed Loan) and ending 30, 60 or 90 days thereafter, as selected by
the Company in its Notice of Borrowing, or Notice of Conversion/Continuation;
and (c) with respect to any Absolute Rate Bid Loan, a period of not less than 7
days nor more than 183 days, as selected by the Company in its Competitive Bid
Request;
provided, that:
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(i) if any Interest Period would otherwise end on a day which
is not a Business Day, that Interest Period shall be extended
to the next succeeding Business Day unless, in the case of a LIBOR
Loan, the result of such extension would be to carry such Interest
Period into another calendar month, in which event such Interest Period
shall end on the immediately preceding Business Day;
(ii) any Interest Period pertaining to a LIBOR Loan that
begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Business Day of the calendar month which is one, two, three or six
months, as the case may be, after the calendar month in which such
Interest Period began; and
(iii) no Interest Period for any Loan shall extend beyond the
Termination Date.
"Invitation for Competitive Bids" means a solicitation for Competitive
Bids, substantially in the form of Exhibit F.
"IRS" means the Internal Revenue Service, or any successor thereto.
"LC Commission" has the meaning specified in Section 2.16(e)(ii).
"LC Obligations" means, at any time, an amount equal to the sum of (a)
the aggregate Stated Amount of the outstanding Letters of Credit and (b) the
aggregate amount of drawings under Letters of Credit which have not then been
reimbursed pursuant to Section 2.16(c). The LC Obligation of any Bank at any
time shall mean the amount equal to (x) the aggregate amount of LC Obligations
outstanding at such time times (y) such Bank's Commitment Percentage.
"Lending Office" means, with respect to each Bank, the office of that
Bank designated as such on Section 2.01 hereto or such other office of the Bank
as it may from time to time specify to the Company and the Documentation Agent
in accordance with this Agreement.
"Letter of Credit" means any letter of credit issued hereunder.
"Letter of Credit Cash Collateral Account" has the meaning specified in
Section 8.02.
"Letter of Credit Commitment Sublimit" means the aggregate amount of
the Standby Letter of Credit Commitment Sublimit and the
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Trade Letter of Credit Commitment Sublimit, as in effect from time to time.
"Letter of Credit Payment" means, as applicable, (a) all payments made
by the Facing Agent pursuant to either a draft or demand for payment under a
Letter of Credit or (b) all payments made by the Banks to the Facing Agent in
respect thereof.
"Letter of Credit Request" has the meaning specified in Section
2.16(b).
"Level I Status" exists at any date if, at such date (i) the Debt
Rating is either A2 (or the equivalent) or higher by Moody's or A (or the
equivalent) or higher by S&P and (ii) the Debt Rating is not lower than Baa3
(or the equivalent) by Moody's or BBB- (or the equivalent) by S&P.
"Level II Status" exists at any date if, at such date (i) the Debt
Rating is either Baa1 (or the equivalent) or higher by Moody's or BBB+ (or the
equivalent) or higher by S&P, (ii)the Debt Rating is not lower than Baa3 (or the
equivalent) by Moody's or BBB- (or the equivalent) by S&P and (iii) Level I
Status does not exist.
"Level III Status" exists at any date if, at such date (i) the Debt
Rating is either Baa3 (or the equivalent) or higher by Moody's or BBB- (or the
equivalent) or higher by S&P, (ii) the Debt Rating is not lower than Baa3 (or
the equivalent) by Moody's or BBB- (or the equivalent) by S&P and (iii) Level I
Status and Level II Status do not exist.
"Level IV Status" exists at any date if, at such date (i) the Debt
Rating is lower than Baa3 (or the equivalent) by Moody's or lower than BBB- (or
the equivalent) by S&P, or (ii) the Company's senior unsecured indebtedness is
unrated by either S&P or Moody's.
"LIBOR" means, with respect to any Interest Period, the rate of
interest per annum determined by the Documentation Agent to be equal to:
(a) the rate of interest per annum for deposits in U.S. Dollars
for a period equal to the relevant Interest Period quoted on Telerate,
page 3750 (or its successor if such page number changes) at or about
11:00 a.m. (London time) on the second Business Day before the
commencement of such Interest Period,
divided (and rounded upward to the nearest 1/16 of 1%) by
(b) a percentage equal to 100% minus the then stated maximum
rate of all reserve requirements (including any marginal, emergency,
supplemental, special or other reserves required by applicable law)
applicable to any member bank of
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the Federal Reserve System in respect of eurocurrency funding or
liabilities as defined in Regulation D of the Federal Reserve Board.
If no quotation is available on Telerate, the rate of interest under clause (a)
above for any Interest Period shall be determined by the Documentation Agent to
be the arithmetic mean (rounded upward to the nearest 1/16 of 1%) of the rates
of interest per annum notified to the Documentation Agent by each Reference
Bank as the rate of interest (rounded upward to the nearest 1/16 of 1%) at
which deposits in an amount approximately equal to the aggregate amount of the
LIBOR Loans requested to be borrowed, and having a maturity equal to such
Interest Period, are offered to major banks in the London interbank market at
or about 11:00 a.m. (London time) on the second Business Day before the
commencement of such Interest Period.
"LIBOR Auction" means a solicitation of Competitive Bids setting forth
a LIBOR Bid Margin pursuant to Section 2.06 hereof.
"LIBOR Bid Loan" means any Competitive Bid Loan that bears interest at
a rate determined with reference to LIBOR.
"LIBOR Bid Margin" has the meaning specified in Section 2.06(c)(ii)(C).
"LIBOR Committed Loan" means any Committed Loan that bears interest at
a rate determined with reference to LIBOR.
"LIBOR Loan" means any LIBOR Bid Loan or LIBOR Committed Loan.
"Lien" means any mortgage, deed of trust, pledge, charge, encumbrance,
lien (statutory or other) or security interest of any nature whatsoever
(including those created by, arising under or evidenced by any conditional sale
or other title retention agreement), and any assignment or deposit arrangement
intended as or having the effect of security.
"Loan" means an extension of credit by a Bank to the Company pursuant
to Article II and may be a Committed Loan or Competitive Bid Loan and "Loans"
means Loans made by all of the Banks.
"Loan Documents" means this Agreement, each Note and any other
agreement, instrument, certificate or other document evidencing, guaranteeing
or securing the Loans.
"Loss" has the meaning specified in Section 3.05.
"Material Adverse Effect" means a material adverse change in, or a
material adverse effect upon, the assets, liabilities, business, operations or
condition of the Company and its Subsidiaries taken as a whole.
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"Moody's" means Xxxxx'x Investors Services, Inc., or any successor to
the rating agency business thereof.
"Note" means any Competitive Bid Note or Committed Loan Note issued
under this Agreement, as the same may be amended, restated, supplemented or
modified and in effect from time to time.
"Notice of Borrowing" means a notice given by the Company to the
Documentation Agent pursuant to Section 2.03 in substantially the form of
Exhibit A.
"Notice of Conversion/Continuation" means a notice given by the Company
to the Documentation Agent pursuant to Section 2.04 in substantially the form
of Exhibit B.
"Obligations" means all Loans, all LC Obligations and other liabilities
(if any), whether actual or contingent, of the Company in respect of Letters of
Credit and all other Indebtedness, advances, debts, liabilities, obligations,
covenants and duties owing by the Company to any Bank, the Documentation Agent,
or to any other Person required to be indemnified under any Loan Document, of
any kind or nature, present or future, whether or not evidenced by any note,
guaranty or other instrument, arising under this Agreement or under any other
Loan Document, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired.
"Other Credit Facilities" means, collectively: (a) the revolving credit
facility evidenced by that certain 364 Day Credit Agreement dated as of the
date hereof among the Company, the Documentation Agent and the financial
institutions signatory thereto, as amended, restated, supplemented or modified
from time to time; (b) the revolving credit facility evidenced by that certain
Seasonal Credit Agreement dated as of the date hereof among the Company, the
Documentation Agent and the financial institutions signatory thereto, as
amended, restated, supplemented or modified from time to time; and (c) the
credit facilities evidenced by that certain Warehouse Facility Revolving Credit
Agreement dated as of the date hereof among the Company, the other borrowers
named therein, Bankers Trust Company, as documentation agent thereunder, and
the financial institutions signatory thereto, as amended, restated,
supplemented or modified from time to time.
"Other Taxes" means any present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Agreement or any other Loan Document.
"Participant" has the meaning specified in Section 10.08(e).
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"Payment Office" means the address for payments set forth on the
signature page hereto in relation to the Documentation Agent, or such other
address as the Documentation Agent may from time to time specify in accordance
with Section 10.02.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, estate,
unincorporated association, joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company or any member of the Controlled Group sponsors or
maintains or to which the Company or any member of the Controlled Group makes,
is making or is obligated to make contributions.
"Potential Default" means any event or circumstance which, with the
giving of notice, the lapse of time, or both, would (if not cured or otherwise
remedied) constitute an Event of Default.
"Reference Banks" means Bankers Trust Company and BofA.
"Reference Rate" means, for any day, the higher of:
(a) 0.5% per annum above the latest Federal Funds Rate for such day;
and
(b) the rate of interest publicly announced from time to time of BofA
in San Francisco, California, as its "reference rate" for such day.
The "reference rate" is a rate set by BofA based upon various factors,
including BofA's costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans, which
may be priced at, above or below such announced rate. Any change in the
Reference Rate announced by BofA shall take effect at the opening of business
on the day specified in the public announcement of such change.
"Reference Rate Committed Loan" means a Committed Loan that bears
interest based on the Reference Rate.
"Rent Expenses" means, for any period, consolidated rent expense of the
Company for such period determined in accordance with GAAP, less consolidated
rental income for such period.
"Reportable Event" means, as to any Plan, (a) any of the events set
forth in Section 4043(b) of ERISA or the regulations thereunder, other than any
such event for which the 30-day notice
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requirement under ERISA has been waived in regulations issued by the PBGC, (b)
a withdrawal from a Plan described in Section 4063 of ERISA, or (c) a cessation
of operations described in Section 4062(e) of ERISA.
"Required Banks" means at any time Banks holding at least 51% of the
aggregate of (a) the then Aggregate Commitment (or, if the Commitments shall
have then been terminated in full, the then aggregate unpaid principal amount
of the Loans plus the aggregate amount of the then outstanding LC Obligations)
plus (b) the then aggregate commitments under the Other Credit Facilities (or,
if the commitments under any of such facilities shall have then been terminated
in full, then with respect to such terminated facilities the then aggregate
unpaid principal amount of all loans outstanding under such terminated
facilities).
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of a court or of a
Governmental Authority, in each case applicable to or binding upon the Person
or any of its property or to which the Person or any of its property is
subject.
"Responsible Officer" means the Company's chief executive officer,
chief financial officer or treasurer.
"S&P" means Standard & Poors's Ratings Group or any successor to the
rating agency business thereof.
"Specialty Retail Subsidiary" means any of the following Subsidiaries
of the Company (or the continuing investment of the Company in any such
entity): Builders Square, Inc.; Borders, Inc.; Coles Xxxx, Ltd.; OfficeMax,
Inc.; PACE Membership Warehouse, Inc.; PayLess Drug Stores Northwest, Inc.; The
Sports Authority, Inc.; and Xxxxxx Book Company, Inc.
"Standby Letter of Credit" means a Letter of Credit which is not a Trade
Letter of Credit.
"Standby Letter of Credit Commitment Sublimit" means an aggregate
amount of Three Hundred Million Dollars ($300,000,000).
"Stated Amount" means the stated or face amount of a Letter of Credit
to the extent available at the time for drawing (subject to presentment of all
requested documents), as the same may be increased or decreased from time to
time in accordance with the terms of such Letter of Credit.
"Subsidiary" means any corporation of which stock having by the terms
thereof ordinary voting power to elect at least a majority of the board of
directors of said corporation is at the time directly or indirectly owned by
the Company or by the Company and one or more Subsidiaries or by one or more
Subsidiaries.
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"Taxes" means any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Bank and the Documentation Agent, such taxes
(including income taxes and franchise taxes) as are imposed on or measured by
such Bank's or the Documentation Agent's net income.
"Termination Date" means the earlier to occur of
(a) October 6, 1997; and
(b) the date on which the Commitments shall terminate in
accordance with the provisions of this Agreement.
"Trade Letter of Credit" means a trade or commercial Letter of Credit
issued by a the Facing Agent pursuant to Section 2.16.
"Trade Letter of Credit Commitment Sublimit" means an aggregate amount
of Six Hundred Million Dollars ($600,000,000).
"Transferee" has the meaning specified in Section 10.08(f).
"Type" means, with respect to any Committed Loan, its nature as a
Reference Rate Committed Loan, a CD Rate Committed Loan or a LIBOR Committed
Loan.
"United States" and "U.S." each means the United States of America.
1.02 Other Definitional Provisions.
(a) Defined Terms. Unless otherwise specified herein or
therein, all terms defined in this Agreement shall have such defined
meanings when used in any certificate or other document made or
delivered pursuant hereto. The meaning of defined terms shall be
equally applicable to the singular and plural forms of the defined
terms.
(b) The Agreement. The words "hereof", "herein", "hereunder"
and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision
of this Agreement; and section, schedule and exhibit references are to
this Agreement unless otherwise specified.
(c) Certain Common Terms.
(i) The term "documents" includes any and all
instruments, documents, agreements, certificates,
indentures, notices and other writings, however evidenced.
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(ii) The term "including" is not limiting and means
"including without limitation."
(d) Performance; Time. Subject to the definition of "Interest
Period" in Section 1.01, whenever any performance obligation hereunder
(other than a payment obligation) shall be stated to be due or required
to be satisfied on a day other than a Business Day, such performance
shall be made or satisfied on the next succeeding Business Day. In the
computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including"; the words
"to" and "until" each mean "to but excluding," and the word "through"
means "to and including". If any provision of this Agreement refers to
any action taken or to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be interpreted to
encompass any and all means, direct or indirect, of taking, or not
taking, such action.
(e) Contracts. Unless otherwise expressly provided herein,
references to agreements and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications
thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document.
(f) Laws. References to any statute or regulation are to be
construed as including all statutory and regulatory provisions
consolidating, amending or replacing the statute or regulation.
(g) Captions. The captions and headings of this Agreement are
for convenience of reference only and shall not affect the
construction of this Agreement.
1.03 Accounting Principles.
(a) Unless the context otherwise clearly requires, all
accounting terms not expressly defined herein shall be construed, and
all financial computations required under this Agreement shall be
made, in accordance with GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter"
refer to such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments. Each Bank severally agrees, on
the terms and conditions hereinafter set forth, and upon
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request by the Company, to make Loans in Dollars to the Company (each such
Loan, a "Committed Loan") and to participate in Letters of Credit from time to
time on any Business Day during the period from the Closing Date to the
Termination Date, in an aggregate principal amount not to exceed at any time
outstanding the amount set forth opposite the Bank's name in Schedule 2.01,
(such amount as the same may be reduced pursuant to Section 2.07 or as a result
of one or more assignments pursuant to Section 10.08, being herein referred to
as a Bank's "Commitment"); provided, that, after giving effect to any Committed
Borrowing or Letter of Credit issuance, the aggregate principal amount of all
outstanding Committed Loans and all Competitive Bid Loans plus the aggregate
amount of outstanding LC Obligations shall not exceed the Aggregate Commitment.
Within the limits of each Bank's Commitment, and subject to the other terms and
conditions hereof, the Company may borrow under this Section 2.01, prepay
pursuant to Section 2.07 and reborrow pursuant to this Section 2.01.
2.02 Loan Accounts; Notes.
(a) The Loans made by each Bank shall be evidenced by one or more loan
accounts maintained by such Bank in the ordinary course of business. The loan
accounts maintained by the Documentation Agent and each Bank shall be prima
facie evidence of the amount of the Loans made by the Banks to the Company and
the interest and payments thereon. Any failure so to record or any error in
doing so shall not, however, limit or otherwise affect the Obligations of the
Company hereunder to pay any amount owing with respect to the Loans. In case of
a discrepancy between the entries in the Documentation Agent's books and any
Bank's books relating to such loan accounts, the Bank's books shall be
considered correct in the absence of manifest error.
(b) The Competitive Bid Loans made by each Bank shall be further
evidenced by a Competitive Bid Note payable to the order of such Bank. Each
such Bank shall endorse on the schedules annexed to its Competitive Bid Note
the date, amount, applicable interest rate and maturity of each Competitive Bid
Loan made by it and the amount of each payment of principal and interest made by
the Company with respect thereto. Each Bank is irrevocably authorized by the
Company to so endorse its Competitive Bid Note and each Bank's record shall
constitute prima facie evidence of the accuracy of the information so recorded;
provided, however, that the failure of a Bank to make, or an error in making, a
notation thereon with respect to any Competitive Bid Loan shall not limit or
otherwise affect the obligations of the Company hereunder or under such
Competitive Bid Note to pay any amount with respect to the Competitive Bid
Loans made by such Bank.
(c) If any Bank shall request, for purposes of Section 10.08(g), the
obligation to repay the Committed Loans may also be evidenced by a Committed
Loan Note. Each Bank shall endorse on the
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schedules annexed to its Committed Loan Note the date, amount, applicable
interest rate and maturity of each Committed Loan made by it and the amount of
each payment of principal and interest made by the Company with respect
thereto. Each Bank is irrevocably authorized by the Company to so endorse its
Committed Loan Note and each Bank's record shall constitute prima facie
evidence of the accuracy of the information so recorded; provided, however,
that the failure of a Bank to make, or an error in making, a notation thereon
with respect to any Committed Loan shall not limit or otherwise affect the
obligations of the Company hereunder or under such Committed Loan Note to pay
any amount with respect to the Committed Loans made by such Bank. Any such
request shall be made by such Bank to the Documentation Agent, which will
prepare (or cause to be prepared) such Committed Loan Note and send the same to
the Company for execution by the Company. Upon such execution, the Company will
promptly deliver such Committed Loan Note to the Bank which requested the same.
2.03 Procedure for Committed Borrowings.
(a) Each Committed Borrowing shall be made upon the irrevocable request
of the Company by a facsimile to the Documentation Agent (which shall be
confirmed promptly by a telephone call) in the form of a Notice of Borrowing
which facsimile must be received by the Documentation Agent prior to 11:00 a.m.
(New York City time) (i) three (3) Business Days prior to the requested
borrowing date, in the case of LIBOR Committed Loans, (ii) two Business Days
prior to the requested borrowing date, in the case of CD Rate Committed Loans
and (iii) on the requested borrowing date, in the case of Reference Rate
Committed Loans, specifying:
(A) the amount of the Committed Borrowing, which shall
be in an aggregate minimum principal amount of Ten Million
Dollars ($10,000,000) or any multiple of Five Million Dollars
($5,000,000) in excess thereof;
(B) the requested borrowing date, which shall be a Business Day;
(C) whether the Committed Borrowing is to be comprised of
LIBOR Committed Loans, CD Rate Committed Loans or Reference Rate
Committed Loans; and
(D) if the Borrowing is to be comprised of LIBOR Committed
Loans or CD Rate Committed Loans, the duration of the initial
Interest Period applicable to such Loans. If the Notice of Borrowing
shall fail to specify the duration of the initial Interest Period for
any LIBOR Committed Loans or CD Rate Committed Loans, the Company shall
be deemed to have elected an Interest Period of one month or 30 days,
respectively;
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provided, however, that with respect to any Committed Borrowings to be made on
the Closing Date, a Notice of Borrowing shall be delivered to the Documentation
Agent not later than 11:00 a.m. (New York City time) on the Closing Date (such
Borrowing will consist of Reference Rate Committed Loans only).
(b) Upon receipt of the Notice of Borrowing, the Documentation Agent
shall promptly notify each Bank thereof and of the amount of such Bank's share
of the requested Committed Borrowing based on such Bank's Commitment
Percentage.
(c) Each Bank will make its Commitment Percentage of each Committed
Borrowing available to the Documentation Agent for the account of the Company
at the Documentation Agent's Payment Office by 2:00 p.m. (New York City time)
on the borrowing date requested by the Company by payment in Dollars and in
funds immediately available to the Documentation Agent. Unless any applicable
condition specified in Article IV has not been satisfied, the proceeds of all
such Loans will then be made available to the Company by the Documentation
Agent at such office by crediting the account of the Company with the aggregate
of the amounts made available to the Documentation Agent by the Banks and in
like funds as received by the Documentation Agent.
(d) After giving effect to any Borrowing, unless consented to by the
Documentation Agent in its sole discretion, there shall not be more than ten
(10) different Interest Periods in effect in respect of all Committed Loans
then outstanding, and not more than fifteen (15) Interest Periods in respect of
all Loans then outstanding.
2.04 Conversion and Continuation Elections for Committed Borrowings.
(a) The Company may upon notice to the Documentation Agent in
accordance with Section 2.04(b):
(i) elect to convert, as of any Business Day, any
Reference Rate Committed Loans (or any part thereof in an
aggregate amount not less than Ten Million Dollars
($10,000,000), or that is in an integral multiple of Five Million
Dollars ($5,000,000) in excess thereof) into LIBOR Committed Loans or
CD Rate Committed Loans; or
(ii) elect to convert, as of the last day of any Interest
Period, any LIBOR Committed Loans maturing on such day (or any
part thereof in an aggregate amount not less than Ten Million Dollars
($10,000,000), or that is in an integral multiple of Five Million
Dollars ($5,000,000) in excess thereof) into Reference Rate Committed
Loans or CD Rate Committed Loans; or
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(iii) elect to convert, as of the last day of any Interest
Period, any CD Rate Committed Loans maturing on such day (or any part
thereof in an aggregate amount not less than Ten Million Dollars
($10,000,000), or that is in an integral multiple of Five Million
Dollars ($5,000,000) in excess thereof) into Reference Rate Committed
Loans or LIBOR Committed Loans; or
(iv) elect to continue as of the last day of any Interest
Period (a "Continuation Date") any LIBOR Committed Loans or CD Rate
Committed Loans maturing on such day (or any part thereof in an
aggregate amount not less than Ten Million Dollars ($10,000,000), or
that is in an integral multiple of Five Million Dollars ($5,000,000) in
excess thereof);
provided, that if the aggregate amount of all LIBOR Committed Loans or CD Rate
Committed Loans comprised in any Borrowing shall have been or would be reduced,
by payment, prepayment, or conversion of part thereof to an amount less than
Ten Million Dollars ($10,000,000), such LIBOR Committed Loans or CD Rate
Committed Loans shall automatically convert into Reference Rate Committed
Loans, on and as of the end of the applicable Interest Period.
(b) If the Company desires to convert or continue any Committed Loan
pursuant to Section 2.04(a), it shall irrevocably request a conversion or
continuation by a facsimile (confirmed promptly by telephone) of a Notice of
Conversion/Continuation to be received by the Documentation Agent not later
than 11:00 a.m. (New York time) at least (i) three (3) Business Days in advance
of the Conversion Date or Continuation Date, if the Committed Loans are to be
converted into or continued as LIBOR Committed Loans, (ii) two (2) Business
Days in advance of the Conversion Date or Continuation Date, if the Committed
Loans are to be converted into or continued as CD Rate Committed Loans and
(iii) on the same Business Day as the Conversion Date, if the Committed Loans
are to be converted into Reference Rate Committed Loans, specifying:
(A) the proposed Conversion Date or Continuation Date;
(B) the aggregate amount of Committed Loans to be converted or
continued;
(C) the nature of the proposed conversion or continuation; and
(D) the duration of the requested Interest Period, if the Loans
are to be converted into or continued as LIBOR Committed Loans or CD
Rate Committed Loans.
(c) If prior to the time set forth in Section 2.04(b), (i) the Company
has failed to give a timely Notice of Conversion/Continuation with respect to
such LIBOR Committed Loans
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or CD Rate Committed Loans or (ii) the Company has failed to select a new
Interest Period to be applicable to such LIBOR Committed Loans or CD Rate
Committed Loans, the Company shall be deemed to have elected to convert such
Loans into Reference Rate Loans effective as of the expiration of the
applicable Interest Period.
(d) During the existence of a Potential Default or Event of Default,
unless the Required Banks otherwise agree, the Company may not elect to have a
Committed Loan be converted into or continued as a LIBOR Committed Loan or a CD
Rate Committed Loan pursuant to Section 2.04.
(e) Upon receipt of a Notice of Conversion/Continuation, the
Documentation Agent will promptly notify each Bank thereof, or, if no timely
notice is provided, the Documentation Agent will promptly notify each Bank of
the details of any automatic conversion or continuation. All conversions and
continuations pursuant to this Section 2.04 shall be made pro rata according to
the respective outstanding principal amounts of the Committed Loans being
converted or continued held by each Bank.
2.05 Competitive Bid Borrowings. In addition to Committed Borrowings
pursuant to Section 2.03, each Bank severally agrees that the Company may, as
set forth in Section 2.06, from time to time prior to the Termination Date,
request the Banks through the Documentation Agent to submit offers to make
Competitive Bid Loans to the Company; provided, however, that the Banks may,
but shall have no obligation to, submit such offers and the Company may, but
shall have no obligation to, accept any such offers; and provided, further, that
at no time shall (a) the aggregate principal amount of all outstanding Loans
exceed the Aggregate Commitment less the aggregate outstanding LC Obligations,
(b) the aggregate principal amount of all outstanding Competitive Bid Loans
exceed the Competitive Bid Commitment Sublimit, or (c) the number of Interest
Periods for Competitive Bid Loans then outstanding plus the number of Interest
Periods for Committed Loans then outstanding exceeds fifteen (15).
2.06 Procedure for Competitive Bid Borrowings.
(a) When the Company wishes to request the Banks to submit offers to
make Competitive Bid Loans hereunder, it shall request the Documentation Agent,
by telephone call (confirmed promptly by facsimile in substantially the form of
Exhibit E (a "Competitive Bid Request")) so as to be received (x) no later than
10:00 a.m. (New York City time) four (4) Business Days prior to the date of a
proposed Competitive Bid Borrowing in the case of a LIBOR Auction, or (y) no
later than 10:00 a.m. (New York City time) two (2) Business Days prior to the
date of a proposed Competitive Bid Request in the case of an Absolute Rate
Auction, specifying:
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(i) the date of such Competitive Bid Borrowing, which shall be
a Business Day;
(ii) the aggregate amount of such Competitive Bid Borrowing,
which shall be a minimum amount of Ten Million Dollars ($10,000,000) or
in multiples of Five Million Dollars ($5,000,000) in excess thereof;
(iii) whether the Competitive Bids requested are to be for
LIBOR Bid Loans or Absolute Rate Bid Loans; and
(iv) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of "Interest Period."
Subject to Section 2.06(c), the Company may not request Competitive Bids for
more than three (3) Interest Periods in a single Competitive Bid Request and
may not request Competitive Bids more than once in any period of five (5)
Business Days (or more frequently, subject to the agreement of the
Documentation Agent).
(b) Upon receipt of a Competitive Bid Request, the Documentation Agent
will promptly send to the Banks by facsimile transmission an Invitation for
Competitive Bids in substantially the form of Exhibit F, which shall constitute
an invitation by the Company to each Bank to submit Competitive Bids offering
to make the Competitive Bid Loans to which such Competitive Bid Request relates
in accordance with this Section 2.06.
(c) (i) Each Bank may at its discretion submit a Competitive
Bid containing an offer or offers to make Competitive Bid Loans in
response to any Invitation for Competitive Bids. Each Competitive Bid
must comply with the requirements of this Section 2.06(c) and must be
submitted to the Documentation Agent by facsimile transmission, at the
Documentation Agent's office for notices set forth on the signature
pages hereto not later than (1) 9:30 a.m. (New York City time) three
(3) Business Days prior to the proposed date of Borrowing, in the case
of a LIBOR Auction, or (2) 9:30 a.m. (New York City time) on the
proposed date of Borrowing, in the case of an Absolute Rate Auction;
provided, that Competitive Bids submitted by the Documentation Agent
(or any Affiliate of the Documentation Agent) in the capacity of a Bank
may be submitted, and may only be submitted, if the Documentation Agent
or such Affiliate notifies the Company of the terms of the offer or
offers contained therein not later than (A) 9:15 a.m. (New York City
time) three (3) Business Days prior to the proposed date of Borrowing,
in the case of a LIBOR Auction, or (B) 9:15 a.m. (New York City time)
on the proposed date of Borrowing, in the case of an Absolute Rate
Auction.
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(ii) Each Competitive Bid submitted by a Bank shall be in
substantially the form of Exhibit G, specifying therein:
(A) the proposed date of Borrowing;
(B) the principal amount of each Competitive Bid Loan
for which such Competitive Bid is being made, which principal
amount (x) may be equal to, greater than or less than
the Commitment of the quoting Bank, (y) must be in a minimum
amount of Ten Million Dollars ($10,000,000) or in multiples of
Five Million Dollars ($5,000,000) in excess thereof, and (z)
may not exceed the principal amount of Competitive Bid Loans
for which Competitive Bids were requested;
(C) in case the Company requests a LIBOR Auction, the
margin above or below LIBOR (the "LIBOR Bid Margin") offered
for each such Competitive Bid Loan, expressed as a percentage
(rounded upward to the nearest 1/16th of 1%) to be added to or
subtracted from the applicable LIBOR for the Interest Period
elected by the Company;
(D) in case the Company requests an Absolute Rate
Auction, the rate of interest per annum (rounded upward to the
nearest 1/1000th of 1%) (the "Absolute Rate") offered for each
such Competitive Bid Loan; and
(E) the identity of the quoting Bank.
A Competitive Bid may contain up to three separate offers by the quoting Bank
with respect to each Interest Period specified in the related Invitation for
Competitive Bids.
(iii) Any Competitive Bid shall be disregarded if it:
(A) is not substantially in conformity with Exhibit G
or does not specify all of the information required by Section
2.06(c)(ii);
(B) contains qualifying, conditional or similar
language;
(C) proposes terms other than or in addition to those
set forth in the applicable Invitation for Competitive Bids;
or
(D) arrives after the time set forth in Section
2.06(c)(i).
(d) Promptly on receipt and not later than 10:00 a.m. (New York City
time) three (3) Business Days prior to the proposed date of Borrowing in the
case of a LIBOR Auction, or 10:00 a.m. (New
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York City time) on the proposed date of Borrowing, in the case of an
Absolute Rate Auction, the Documentation Agent will notify the Company of the
terms (i) of any Competitive Bid submitted by a Bank that is in accordance with
Section 2.06(c), and (ii) of any Competitive Bid that amends, modifies or is
otherwise inconsistent with a previous Competitive Bid submitted by such Bank
with respect to the same Competitive Bid Request. Any such subsequent
Competitive Bid shall be disregarded by the Documentation Agent unless such
subsequent Competitive Bid is submitted solely to correct a manifest error in
such former Competitive Bid and only if received within the times set forth in
Section 2.06(c). The Documentation Agent's notice to the Company shall specify
(1) the aggregate principal amount of Competitive Bid Loans for which offers
have been received for each Interest Period specified in the related
Competitive Bid Request; and (2) the respective principal amounts and LIBOR Bid
Margins or Absolute Rates, as the case may be, so offered. Subject only to the
provisions of Sections 3.04 and 4.02 hereof relating to a Competitive Bid Loan
and the provisions of this Section 2.06(d), any Competitive Bid relating to a
Competitive Bid Loan shall be irrevocable except with the written consent of
the Documentation Agent given on the written instructions of the Company.
(e) Not later than 10:30 a.m. (New York City time) three (3) Business
Days prior to the proposed date of Borrowing, in the case of a LIBOR Auction,
or 10:30 a.m. (New York City time) on the proposed date of Borrowing, in the
case of an Absolute Rate Auction, the Company shall notify the Documentation
Agent of the Company's acceptance or non-acceptance of the Competitive Bids so
notified to it pursuant to Section 2.06(d). The Company shall be under no
obligation to accept any offer and may choose to reject all offers. In the case
of acceptance, such notice shall specify the aggregate principal amount of
offers for each Interest Period that is accepted. The Company may accept any
Competitive Bid in whole, or, with the prior consent of the bidding Bank, in
part; provided, that:
(i) the aggregate principal amount of each Competitive Bid
Borrowing may not exceed the applicable amount set forth in the
related Competitive Bid Request;
(ii) the acceptance of Competitive Bids may only be made on the
basis of ascending LIBOR Bid Margins or Absolute Rates within
each Interest Period, as the case may be;
(iii) the aggregate principal amount of each Competitive Bid
Borrowing must be Ten Million Dollars ($10,000,000) or in any
multiple of Five Million Dollars ($5,000,000) in excess thereof; and
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(iv) the Company may not accept any Competitive Bid
that is described in Section 2.06(c)(iii) or that otherwise fails to
comply with the requirements of this Agreement.
(f) If offers are made by two or more Banks with the same LIBOR Bid
Margins or Absolute Rates, as the case may be, for a greater aggregate
principal amount than the amount in respect of which such offers are accepted
for the related Interest Period, the principal amount of Competitive Bid Loans
in respect of which such offers are accepted shall be allocated by the
Documentation Agent among such Banks as nearly as possible (in such multiples,
not less than One Million Dollars ($1,000,000), as the Documentation Agent may
deem appropriate) in proportion to the aggregate principal amounts of such
Competitive Bids. Determination by the Documentation Agent of the allocation of
the amounts of Competitive Bid Loans shall be conclusive in the absence of
manifest error.
(g) The Documentation Agent will promptly notify each Bank having
submitted a Competitive Bid if its offer has been accepted and, if its
Competitive Bid has been accepted, of the amount of the Competitive Bid Loan or
Competitive Bid Loans to be made by it on the date of the Competitive Bid
Borrowing.
(h) Each Bank which has received notice pursuant to Section 2.06(g)
that its Competitive Bid has been accepted, shall make the amounts of such
Competitive Bid Loans available to the Documentation Agent for the account of
the Company at the Documentation Agent's Payment Office, by 11:00 a.m. (New
York City time) on the date of such Competitive Bid Borrowing, in funds
immediately available to the Documentation Agent.
(i) If, on or prior to the proposed date of Borrowing, the Commitments
have not been terminated and if, on such proposed date of Borrowing all
applicable conditions to funding referenced in Sections 3.02, 3.04 and 4.02
hereof are satisfied, the Bank or Banks whose offers the Company has accepted
will fund each Competitive Bid Loan so accepted. Nothing in this Section 2.06
shall be construed as a right of first offer in favor of the Banks or to
otherwise limit the ability of the Company to request and accept any other
credit facilities from any Person (including any of the Banks); provided, that
no Potential Default or Event of Default would otherwise arise or exist as a
result of the Company executing, delivering or performing under such other
credit facilities.
(j) Each outstanding Competitive Bid Loan shall reduce pro tanto the
available Aggregate Commitment, but shall not otherwise reduce or affect the
available Commitment or Commitment Percentage of any Bank which made a
Competitive Bid Loan.
(k) Promptly following each Competitive Bid Borrowing, the
Documentation Agent shall notify each Bank of the ranges of bids
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submitted and the highest and lowest bids accepted for each Interest Period
requested by the Company and the aggregate amount borrowed pursuant to such
Competitive Bid Borrowing. From time to time, the Company and the Banks shall
furnish such information to the Documentation Agent as the Documentation Agent
may request relating to the making of Competitive Bid Loans, including the
amounts, interest rates, dates of Borrowings and maturities thereof, for
purposes of the allocation of amounts received from the Company for payment of
all amounts owing hereunder.
2.07 Voluntary Termination or Reduction of Commitments. The Company
may, upon not less than five (5) Business Days' prior notice to the
Documentation Agent, terminate the Aggregate Commitment or permanently reduce
the Aggregate Commitment by a minimum amount of Ten Million Dollars
($10,000,000) or in multiples of Five Million Dollars ($5,000,000) in excess
thereof; provided, that no such reduction or termination of the Aggregate
Commitment shall be permitted if, after giving effect thereto and to any
prepayments of the Loans made on the effective date thereof, the then
outstanding LC Obligations would exceed the amount of the Aggregate Commitment;
provided, further, that once reduced in accordance with this Section 2.07, the
Aggregate Commitment may not thereafter be increased. Any reduction of the
Aggregate Commitment shall be applied to each Bank's Commitment pro rata in
accordance with such Bank's relevant Commitment Percentage. If the Aggregate
Commitment is terminated in its entirety, all accrued unpaid interest and all
fees with respect thereto accrued to the effective date of such termination
shall be payable on the effective date of such termination without any premium
or penalty.
2.08 Optional Prepayments of Committed Loans.
(a) Subject to Section 3.05, the Company may, at any time or from time
to time, upon at least five (5) Business Days' notice to the Documentation
Agent prepay LIBOR Committed Loans or CD Rate Committed Loans or upon at least
one Business Day's notice to the Documentation Agent prepay Reference Rate
Committed Loans, in whole or in part, in minimum amounts of Ten Million Dollars
($10,000,000) or in multiples of Five Million Dollars ($5,000,000) in excess
thereof. Such notice of prepayment shall specify the date and amount of such
prepayment and whether such prepayment is of Reference Rate Committed Loans,
LIBOR Committed Loans or CD Rate Committed Loans. Such notice shall not
thereafter be revocable by the Company, and the Documentation Agent will
promptly notify each Bank thereof and of such Bank's Commitment Percentage of
such prepayment. If such notice is given, the Company shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to each
such date on the amount prepaid and the amounts required pursuant to Section
3.05.
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(b) The Company may not voluntarily prepay all or any portion of the
principal amount of any Competitive Bid Loan prior to the maturity thereof.
2.09 Repayment.
(a) The Committed Loans. The Company shall repay the aggregate
outstanding principal amount of the Committed Loans on the Termination Date.
(b) The Competitive Bid Loans. Each Competitive Bid Loan shall mature,
and the principal amount thereof shall be due and payable, on the last day of
the Interest Period applicable thereto.
2.10 Interest.
(a) Subject to Sections 2.10(d) and (e), each Committed Loan shall bear
interest on the outstanding principal amount thereof from the date when made
until paid in full, at the option of the Company as set forth in its Notice of
Borrowing or Notice of Conversion/Continuation,
(i) if such Committed Loan is a Reference Rate Committed Loan,
at a rate per annum equal to the Reference Rate;
(ii) if such Loan is a LIBOR Committed Loan, at a rate per
annum equal to the sum of LIBOR plus the applicable margin set forth
below:
Debt Rating Applicable Margin
Level I Status .225%
Level II Status .2625%
Level III Status .3125%
Level IV Status .50%; and
(iii) if such Committed Loan is a CD Rate Committed Loan, at a
rate per annum equal to the sum of the CD Rate plus the applicable
margin set forth below:
Debt Rating Applicable Margin
Level I Status .35%
Level II Status .3875%
Level III Status .4375%
Level IV Status .625%
(b) Any change in the Debt Rating shall be effective as of the date on
which such change is first publicly announced by Xxxxx'x or S&P. Any change in
the applicable margin due to a change in the applicable Debt Rating shall be
effective on the effective date of such change in the Debt Rating and shall
apply to
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all Committed Loans that are outstanding at any time during the period
commencing on the effective date of such change in the Debt Rating and ending
on the date immediately preceding the effective date of the next such change in
the Debt Rating which results in a change in the applicable margin.
(c) Interest on each Loan shall be payable in arrears on each
applicable Interest Payment Date. Interest shall also be payable on the date of
any prepayment of Committed Loans for the portion of the Loans so prepaid and,
in the case of conversion of any Reference Rate Committed Loan, on the date of
conversion thereof into a LIBOR Committed Loan or a CD Rate Committed Loan.
(d) During the continuation of any Event of Default or after
acceleration, the Company shall pay, on demand, interest (after as well as
before judgment) on the principal amount of all Loans then outstanding, at a
rate per annum which is determined by increasing the rate of interest then in
effect by 2% per annum; provided, however, that, on and after the expiration of
the Interest Period applicable to any LIBOR Committed Loan or CD Rate Committed
Loan on the date of occurrence of such Event of Default or acceleration, the
principal amount of such Loan shall, during the continuation of such Event of
Default or acceleration, bear interest at a rate per annum equal to the
Reference Rate plus 2%.
(e) Anything herein to the contrary notwithstanding, the obligations of
the Company hereunder shall be subject to the limitation that payments of
interest shall not be required, for any period for which interest is computed
hereunder, to the extent (but only to the extent) that contracting for or
receiving such payment by any Bank would be contrary to the provisions of any
law applicable to such Bank limiting the highest rate of interest which may be
lawfully contracted for, charged or received by such Bank, and in such event
the Company shall pay such Bank interest at the highest rate permitted by
applicable law.
2.11 Fees.
(a) Facility Fee.
(i) The Company shall pay to the Documentation Agent for the
account of each Bank a facility fee equal to the percentage per annum
set forth below times such Bank's Commitment (regardless of
utilization):
Debt Rating Facility Fee
Level I Status .125%
Level II Status .1375%
Level III Status .1875%
Level IV Status .25%
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(ii) Any change in the Debt Rating shall be effective as of the
date on which such change is first publicly announced by Xxxxx'x or
S&P. Any change in the facility fee due to a change in the applicable
Debt Rating shall be effective on the effective date of such change in
the Debt Rating and shall apply at any time during the period
commencing on the effective date of such change in the Debt Rating and
ending on the date immediately preceding the effective date of the next
such change in the Debt Rating which results in a change in the
facility fee.
(iii) The facility fee shall accrue from the Closing Date to
the Termination Date and shall be due and payable quarterly in arrears
on the last Business Day of each calendar quarter, commencing with the
calendar quarter ending on December 31, 1994, and on the Termination
Date.
(b) Syndication Fees. The Company shall pay in Dollars to the Arrangers
on the Closing Date fees in the amount set forth in a letter agreement between
the Company and BofA and Bankers Trust Company dated August 29, 1994.
(c) Administration Fees. The Company shall pay to the Documentation
Agent administration and transaction fees in Dollars in the amounts and at the
times set forth in a letter agreement between the Company and BofA and Bankers
Trust Company dated August 29, 1994.
2.12 Computation of Fees and Interest.
(a) All computations of fees and interest under this Agreement shall be
made on the basis of a 360-day year and actual days elapsed. Interest and fees
shall accrue during each period during which interest on such fees are computed
from and including the first day thereof to but excluding the last day thereof.
Any Interest or fees not paid when due after any applicable grace period, shall
bear interest at a rate equal to the Reference Rate plus 2%.
(b) The Documentation Agent will, with reasonable promptness, notify
the Company and the Banks of each determination of LIBOR, the CD Rate and the
Reference Rate; provided, that any failure to do so shall not relieve the
Company of any liability hereunder. The Documentation Agent will, with
reasonable promptness, notify the Company and the Banks of the effective date
and the amount of any change in the Debt Rating resulting in a change in the
applicable rate of interest or fees; provided, that any failure to do so shall
not relieve the Company of any liability hereunder.
(c) Each determination of an interest rate by the Documentation Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Company and the Banks in the
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absence of manifest error. The Documentation Agent, at the request of the
Company or any Bank, will deliver to the Company or such Bank, as the case may
be, a statement showing the quotations used by the Documentation Agent in
determining any interest rate.
(d) If either Reference Bank's Commitment shall terminate (otherwise
than on termination of the Aggregate Commitment), or for any reason whatsoever
either Reference Bank shall cease to be a Bank hereunder, then such Reference
Bank shall thereupon cease to be a Reference Bank, and, when necessary (until
such Reference Bank shall have been replaced pursuant to Section 2.12(e)),
LIBOR and the CD Rate shall be determined on the basis of the rates as notified
by the remaining Reference Bank.
(e) Each Reference Bank shall use its best efforts to furnish
quotations of rates to the Documentation Agent as contemplated hereby. If
either Reference Bank shall be unable or otherwise fail to supply such rates to
the Documentation Agent upon its request, the rate of interest shall be
determined on the basis of the quotations of the remaining Reference Bank. The
Company and the Documentation Agent may select a new Reference Bank to replace
any Reference Bank that shall cease to be a Bank hereunder or that fails to
supply rates as required hereunder.
2.13 Payments by the Company.
(a) All payments (including prepayments) to be made by the Company on
account of principal, interest, fees and other amounts required hereunder shall
be made without set-off or counterclaim and shall, except as otherwise
expressly provided herein, be made to the Documentation Agent at its Payment
Office for the ratable account of the Banks in Dollars and in immediately
available funds, no later than 2:00 p.m. (New York City time) on the date
specified herein. The Documentation Agent will promptly distribute to each Bank
its Commitment Percentage (or other applicable share as expressly provided
herein) of such principal, interest, fees or other amounts, in like funds as
received. Unless otherwise waived by the Documentation Agent with respect to a
payment, any payment which is received by the Documentation Agent later than
2:00 p.m. (New York City time) shall be deemed to have been received on the
immediately succeeding Business Day and any applicable interest or fee shall
continue to accrue until such payment is deemed to have been received.
(b) Except as otherwise set forth in the definition of Interest Period,
whenever any payment hereunder shall be stated to be due on a day other than a
Business Day, such payment shall be made on the next succeeding Business Day,
and such extension of time shall in such case be included in the computation of
interest or fees, as the case may be.
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(c) Unless the Documentation Agent shall have received notice from the
Company prior to the date on which any payment is due to the Banks hereunder
that the Company will not make such payment in full, the Documentation Agent
may assume that the Company has made such payment in full to the Documentation
Agent as required hereunder on such date and the Documentation Agent may (but
shall not be so required), in reliance upon such assumption, cause to be
distributed to each Bank on such due date an amount equal to the amount then
due such Bank. If and to the extent the Company shall not have made such
payment in full to the Documentation Agent, each bank shall repay to the
Documentation Agent on demand such amount distributed to such Bank, together
with interest thereon for each day from the date such amount was distributed to
such Bank until the date such Bank repays such amount to the Documentation
Agent at the Federal Funds Rate.
2.14 Payments by the Banks to the Documentation Agent.
(a) Unless the Documentation Agent shall have received notice from a
Bank on the Closing Date or, with respect to each Borrowing after the Closing
Date, at least one (1) Business Day prior to the date of any proposed Borrowing
of LIBOR Committed Loans or CD Rate Committed Loans or prior to 11:00 a.m. (New
York City time) on the date of the proposed Borrowing of any Reference Rate
Committed Loans, that such Bank will not make available to the Documentation
Agent for the account of the Company the amount of that Bank's share of Loans
included in the Borrowing, the Documentation Agent may assume that each Bank
has made such amount and the full amount of any Competitive Bid Loans of such
Bank that are included in the Borrowing available to the Documentation Agent as
required hereunder on the Borrowing Date and the Documentation Agent may (but
shall not be so required), in reliance upon such assumption, make available to
the Company on such date a corresponding amount. If and to the extent any Bank
shall not have made its full amount available to the Documentation Agent and
the Documentation Agent in such circumstances has made available to the Company
such amount, that Bank shall on the next Business Day following the date of
such Borrowing make such amount available to the Documentation Agent, together
with interest at the Federal Funds Rate, in each case as in effect for each
such day. A notice of the Documentation Agent submitted to any Bank with
respect to amounts owing under this Section 2.14(a) shall be conclusive, absent
manifest error. If such amount is so made available, such payment to the
Documentation Agent shall constitute such Bank's Loan on the date of Borrowing
for all purposes of this Agreement. If such amount is not made available to the
Documentation Agent on the next Business Day following the date of such
Borrowing, the Documentation Agent shall notify the Company of such failure to
fund and, upon demand by the Documentation Agent, the Company shall pay such
amount to the Documentation Agent for the Documentation Agent's account,
together with interest thereon for each day elapsed since the date of such
Borrowing, at a rate per annum equal to the interest rate
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applicable at the time to the Loans comprising such Borrowing without making or
being responsible for any payment under Section 3.05.
(b) The failure of any Bank to make any Committed Loan on any date of
Borrowing shall not relieve any other Bank of any obligation hereunder to make
a Committed Loan on the date of such Borrowing, but no Bank shall be
responsible for the failure of any other Bank to make the Committed Loan to be
made by such other Bank on the date of any Borrowing.
2.15 Sharing of Payments, Etc.
(a) If, other than as expressly set forth elsewhere herein, any Bank
shall obtain on account of the Committed Loans made by it any payment (whether
voluntary, involuntary, through the exercise of any right of set-off, or
otherwise) in excess of its Commitment Percentage of payments on account of the
Committed Loans obtained by all the Banks, such Bank shall forthwith (x) notify
the Documentation Agent of such fact, and (y) purchase from the other Banks
such participations in the Committed Loans made by them as shall be necessary
to cause such purchasing Bank to share the excess payment ratably with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid thereto together with an amount equal to such paying Bank's
Commitment Percentage (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Documentation
Agent will keep records (which shall be conclusive and binding in the absence
of manifest error), of participations purchased pursuant to this Section
2.15(a) and will in each case notify the Banks and the Company following any
such purchases. Any Bank having outstanding both Committed Loans and
Competitive Bid Loans at any time a right of set-off is exercised by such Bank
shall apply the proceeds of such set-off first to such Bank's Committed Loans
hereunder, until its Committed Loans are reduced to zero, and thereafter to
its Competitive Bid Loans.
(b) The Company agrees that any Bank so purchasing a participation from
another Bank pursuant to this Section 2.15 may, to the fullest extent permitted
by law, exercise all its rights of payment (including the right of set-off, but
subject to Section 10.09) with respect to such participation as fully as if such
Bank were the direct creditor of the Company in the amount of such
participation.
(c) Nothing herein shall require any Bank to exercise any right of
set-off or similar rights or shall affect the right of any
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Bank to exercise, and retain the benefits of exercising any such right with
respect to any other indebtedness or obligation of the Company.
2.16 Amount and Terms of Letters of Credit.
(a) Letter of Credit Commitments; Terms of Letters of Credit.
(i) Subject to and upon the terms and conditions herein set
forth, at any time and from time to time on or after the date hereof
and to but not including a date which is thirty (30) days prior to the
Termination Date, each Bank selected by the Company which is reasonably
acceptable to the Documentation Agent (and which agrees to perform the
services of a fronting bank) agrees to issue (in such capacity, a
"Facing Agent") in its own name or through an Affiliate, one or more
Letters of Credit for the account of the Company in an aggregate Stated
Amount in Dollars at any one time that, together with the aggregate
Stated Amount of all other Letters of Credit issued pursuant hereto,
does not exceed the Letter of Credit Commitment Sublimit; provided,
however, that no Facing Agent shall issue or extend the expiration of
any Letter of Credit if, immediately after giving effect to such
issuance or extension, (A) the aggregate LC Obligations in respect of
Standby Letters of Credit at such time would exceed the Standby Letter
of Credit Commitment Sublimit, or (B) the aggregate LC Obligations in
respect of Trade Letters of Credit at such time would exceed the Trade
Letter of Credit Commitment Sublimit, or (C) the Commitment of any Bank
would be exceeded. Each Bank severally, but not jointly, agrees to
participate in each such Letter of Credit issued by a Facing Agent
ratably according to its Commitment Percentage and to make available to
such Facing Agent such Bank's Commitment Percentage of any payment made
to the beneficiary of such Letter of Credit to the extent not
reimbursed by the Company; provided, however, that no Bank shall be
required to participate in any Letter of Credit to the extent that its
participation therein would exceed such Bank's Commitment then in
effect. No Bank's obligation to participate in any Letter of Credit or
to make available to a Facing Agent such Bank's Commitment Percentage
of any Letter of Credit Payment made by the Facing Agent shall be
affected by any other Bank's failure to participate in the same or any
other Letter of Credit or by any other Bank's failure to make available
to the relevant Facing Agent such other Bank's Commitment Percentage of
any Letter of Credit Payment.
(ii) Each Letter of Credit issued or to be issued hereunder
shall have an expiration date of one (1) year or less from the issuance
date thereof; provided, however, that each Standby Letter of Credit may
provide by its terms that it will be automatically renewed for
additional successive
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periods of up to one (1) year unless the relevant Facing Agent
shall have given notice to the applicable beneficiary
(with a copy to the Company) of the election by such Facing Agent (such
election to be in the sole and absolute discretion of such Facing
Agent) not to extend such Letter of Credit, such notice to be given not
less than thirty (30) days prior to the then current expiration date of
such Letter of Credit; provided, further, that no Standby Letter of
Credit or renewal thereof shall be dated to expire later than the
Termination Date and no Trade Letter of Credit or renewal thereof shall
be stated to expire later than the day thirty (30) days prior to the
Termination Date.
(b) Procedure for Issuance of Letters of Credit. Whenever the Company
desires the issuance of a Letter of Credit hereunder, it shall give the
relevant Facing Agent (with a copy to the Documentation Agent) at least five
(5) Business Days' prior written notice specifying the requested day of
issuance thereof (which day shall be a Business Day), such notice to be given
prior to 10:00 a.m. (New York City time) on the date specified for the giving
of such notice. Each such notice (each, a "Letter of Credit Request") shall be
in the form of Exhibit J hereto and shall specify (A) the name of the Bank
which the Company would like to act as the Facing Agent, (B) the proposed
issuance date and expiration date of the requested Letter of Credit, (C) the
name and address of the beneficiary (which Person shall be reasonably
acceptable to the Facing Agent), (D) the Stated Amount of such Letter of
Credit, (E) the purpose of such Letter of Credit (which shall be acceptable to
the Facing Agent), and (F) such other information as the Documentation Agent or
the Facing Agent may reasonably request. In addition, each Letter of Credit
Request shall contain a description of the terms and conditions to be included
in the proposed Letter of Credit (all of which terms and conditions shall be
acceptable to the Facing Agent). No Letter of Credit shall contain any
provision for payment thereunder at any time earlier than 2:00 p.m. (New York
City time) on the first Business Day after the presentation of all drafts,
demands for payment and all other documents, if any, required to be presented
pursuant to such Letter of Credit. Unless otherwise specified, all Letters of
Credit will be governed by the Uniform Customs and Practice for Documentary
Credits of the International Chamber of Commerce as in effect on the date of
issuance of such Letter of Credit. On the Business Day specified by the Company
and upon fulfillment or waiver of the applicable conditions set forth in
Article IV, the Facing Agent will issue the requested Letter of Credit to the
applicable beneficiary.
(c) Draws upon Letters of Credit; Reimbursement Obligations. In the
event of any request for drawing under any Letter of Credit by the beneficiary
thereof, the Facing Agent shall give telephonic notice to the Company and the
Documentation Agent (x) confirming receipt of such request and (y) of the date
on or before which the Facing Agent intends to honor such drawing, and the
Company shall
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reimburse the Facing Agent on the day on which such drawing is honored in an
amount in Dollars in same day funds equal to the amount of such drawing;
provided, however, that, anything contained in this Agreement to the contrary
notwithstanding, (i) unless the Company shall have notified the Documentation
Agent and the Facing Agent prior to 10:00 a.m. (New York City time) on
the Business Day of such drawing that the Company intends to reimburse the
Facing Agent for the amount of such drawing with funds other than the proceeds
of Loans, the Company shall be deemed to have timely given a Notice of
Borrowing to the Documentation Agent requesting each Bank to make Reference
Rate Committed Loans on the date on which such drawing is honored in an amount
equal to the amount of such drawing and (ii) subject to satisfaction or waiver
of the conditions specified in Section 4.02, each such Bank shall, on the date
of such drawing, make Reference Rate Committed Loans in the amount of its
Commitment Percentage of such drawing, the proceeds of which shall be applied
directly by the Documentation Agent to reimburse the Facing Agent for the
amount of such drawing; provided, further, that, if for any reason,
proceeds of Reference Rate Committed Loans are not received by the Facing
Agent on such date in an amount equal to the amount of such drawing, the
Company shall reimburse the Facing Agent, on the Business Day immediately
following the date of such drawing, in an amount in same day funds equal to
the excess of the amount of such drawing over the amount of such Reference
Rate Committed Loans, if any, which are so received, plus accrued interest on
such amount at the Reference Rate.
(d) Banks' Participation in Letters of Credit. In the event that the
Company shall fail to reimburse the Facing Agent as provided in Section 2.16(c)
in an amount equal to the amount of any drawing honored by the Facing Agent
under a Letter of Credit issued by it in accordance with the terms hereof, the
Facing Agent shall promptly notify the Documentation Agent and the
Documentation Agent shall promptly notify each Bank of the unreimbursed amount
of such drawing and of such Bank's respective participation therein. Each such
Bank shall make available to the Facing Agent an amount equal to its Commitment
Percentage of such drawing in same day funds, together with interest thereon at
the Federal Funds Rate for the period from the date of funding of such drawing
to the date of payment by such Bank, at the office of the Facing Agent
specified in such notice, not later than 1:00 p.m. (New York City time) on the
Business Day after the date such Bank is notified by the Documentation Agent.
In the event that any such Bank fails to make available to the Facing Agent the
amount of such Bank's participation in such Letter of Credit as provided in
this Section 2.16(d), the Facing Agent shall be entitled to recover such amount
on demand from such Bank together with interest at the Federal Funds Rate for
two Business Days and thereafter at the Reference Rate. Nothing in this Section
2.16(d) shall be deemed to prejudice the right of any Bank to recover from the
Facing Agent any amounts made available by such Bank to the Facing Agent
pursuant to this
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Section 2.16(d) in the event that it is determined by a court of competent
jurisdiction that the payment with respect to a Letter of Credit by the Facing
Agent in respect of which payment was made by such Bank constituted gross
negligence or willful misconduct on the part of the Facing Agent. The Facing
Agent shall distribute to each Bank which has paid all amounts payable by it
under this Section 2.16(d) with respect to any Letter of Credit issued by such
Facing Agent such Bank's Commitment Percentage of all payments received by such
Facing Agent from the Company in reimbursement of drawings honored by such
Facing Agent under such Letter of Credit when such payments are received and
shall promptly notify the Documentation Agent of such payment.
(e) Interest and Fees for Letters of Credit.
(i) Facing Agent Fees. The Company agrees to pay the
following amount to each Facing Agent with respect to Letters of
Credit issued by it for the account of the Company:
(A) with respect to drawings made under any Letter of
Credit, interest, payable on demand, on the amount paid by
such Facing Agent in respect of each such drawing from the date
of the drawing through the date such amount is reimbursed by
the Company (including any such reimbursement out of the
proceeds of Loans pursuant to Section 2.16(c)) or the Banks at
a rate which is at all times equal to 2% per annum in excess
of the Reference Rate;
(B) with respect to the issuance or amendment of each
Letter of Credit and each drawing made thereunder, documentary
and processing charges in accordance with the Facing Agent's
agreement with the Company for such charges in effect at the
time of such issuance, amendment, transfer or drawing, as the
case may be; and
(C) a facing fee in respect of Trade Letters of Credit
as agreed from time to time by the Company and the Facing Agent.
(ii) Participating Bank Fees. The Company agrees to pay to the
Documentation Agent for distribution to each participating Bank in
respect of all Standby Letters of Credit outstanding such Bank's
Commitment Percentage of a commission equal to the applicable margin
then in effect in respect of LIBOR Committed Loans pursuant to Section
2.10(a) multiplied by the maximum Stated Amount under such outstanding
Letters of Credit (the "LC Commission"), payable in arrears on and
through the last Business Day of each calendar quarter, on the
Termination Date and thereafter, on demand. The LC Commission shall be
computed from the first day of issuance of each
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Standby Letter of Credit and on the basis of the actual number of days
elapsed over a year of 360 days.
Promptly upon receipt by the Facing Agent of any amount described in
clause (i)(A) of this Section 2.16(e), the Facing Agent shall distribute to
each Bank that has reimbursed the Facing Agent in accordance with Section
2.16(d) its Commitment Percentage of such amount. Amounts payable under clauses
(i)(B) and (C) of this Section 2.16(e) shall be payable directly to the Facing
Agent for its own account.
(f) LC Obligations Unconditional. Subject to the last paragraph of
Section 2.16(g), the obligation of the Company to reimburse a Facing Agent for
drawings made under any Letter of Credit issued by it and the obligations of
each Bank under Section 2.16(d) with respect thereto shall be unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following circumstances:
(i) any lack of validity or enforceability of such Letter of
Credit;
(ii) the existence of any claim, setoff, defense or other right
which the Company or any of its Affiliates may have at any time
against a beneficiary or any transferee of such Letter of Credit (or
any Persons for which any such beneficiary or transferee may be
acting), the Facing Agent, any Bank or any other Person, whether in
connection with this Agreement, the transactions contemplated herein or
any unrelated transaction (including any underlying transaction between
the Company or one of its Subsidiaries and the beneficiary of such
Letter of Credit);
(iii) any draft, demand, certificate or any other document
presented under such Letter of Credit proving to be forged, fraudulent
invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;
(iv) payment by the Facing Agent under such Letter of Credit
against presentation of a demand, draft or certificate or other
document which does not comply with the terms of such Letter of Credit;
(v) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing; or
(vi) the fact that an Event of Default or a Potential Default
shall have occurred and be continuing.
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(g) Indemnification. In addition to amounts payable as elsewhere
provided in this Agreement, the Company hereby agrees to indemnify and hold
harmless, the Facing Agent from and against any and all actions, suits,
proceedings, liabilities, damages, or other claims of any kind or nature
whatsoever which may be made by or asserted against the Facing Agent as a
result of (i) the issuance of the Letters of Credit, other than as a result of
the gross negligence or willful misconduct of the Facing Agent (including
without limitation (A) the Facing Agent's wrongful dishonor of any Letter of
Credit after the presentation to it by the beneficiary thereunder of a draft or
other demand for payment and other documentation strictly complying with the
terms and conditions of such Letter of Credit, or (B) the payment by the Facing
Agent to the beneficiary under any Letter of Credit against presentation of
documents which do not substantially comply with the terms of the Letter of
Credit) or (ii) the failure of the Facing Agent to honor a drawing under any
Letter of Credit as a result of any act or omissions, whether rightful or
wrongful, of any present or future de jure or de facto government or
Governmental Authority (all such acts or omissions herein called "Government
Acts"). As between the Company and the Facing Agent, the Company assumes all
risks of the acts and omissions of, or misuse of the Letters of Credit issued
by the Facing Agent by, the respective beneficiaries of such Letters of Credit.
In furtherance and not in limitation of the foregoing, the Facing Agent shall
not be responsible: (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for the issuance of or any drawing under such
Letters of Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (ii) for the validity
or sufficiency of any instrument transferring or assigning or purporting to
transfer or assign and such Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (iii) for failure of the beneficiary of
any such Letter of Credit to comply fully with conditions required in order to
draw upon such Letter of Credit; (iv) for errors, omissions interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher, (v) for errors in
interpretation of technical terms; (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit or the proceeds
of any drawing under such Letter of Credit; and (viii) for any consequences
arising from causes beyond the control of the Facing Agent (including any
Government Acts). None of the above shall affect, impair, or prevent the
vesting of any of the Facing Agent's rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or
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omitted by the Facing Agent under or in connection with the Letters of Credit
issued by it or the related certificates, if taken or omitted in good faith,
shall not put the Facing Agent under any resulting liability to the Company.
Notwithstanding anything to the contrary contained in this Agreement, the
Company shall have no obligation to indemnify the Facing Agent in respect of
any liability incurred by the Facing Agent arising solely out of the gross
negligence or willful misconduct of the Facing Agent. The right of
indemnification in the first paragraph of this Section 2.16(g) shall not
prejudice any rights that the Company may otherwise have against the Facing
Agent with respect to a Letter of Credit issued hereunder.
(h) Stated Amount. The Stated Amount of each Letter of Credit shall be
such amount as the Company and the Facing Agent have agreed to. For purposes of
calculating the Stated Amount of any Letter of Credit at any time:
(i) any increase in the Stated Amount of any Letter of Credit
by reason of any amendment to any Letter of Credit shall be deemed
effective under this Agreement as of the date the Facing Agent
actually issues an amendment purporting to increase the Stated Amount
of such Letter of Credit, whether or not the Facing Agent received the
consent of the Letter of Credit beneficiary or beneficiaries to the
amendment; and
(ii) any reduction in the Stated Amount of any Letter of Credit
by reason of any amendment to any Letter of Credit shall be deemed
effective under this Agreement as of the later of (x) the date the
Facing Agent actually issues an amendment purporting to reduce the
Stated Amount of such Letter of Credit, whether or not the amendment
provides that the reduction be given effect as of an earlier date, or
(y) the date the Facing Agent receives the written consent (including
by telex or facsimile transmission) of the Letter of Credit
beneficiary or beneficiaries to such reduction, which written consent
must be dated on or after the date of the amendment issued by the
Facing Agent purporting to effect such reduction.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.
(a) All payments of principal of and interest on the Loans (other than
Reference Rate Committed Loans) shall be made by the Company without
set-off or counterclaim for or on account of, and free and clear of, and
without deduction or withholding for, or on
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account of, any Taxes. In addition, the Company shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless each Bank and the
Documentation Agent for the full amount of Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 3.01 paid by such Bank or
the Documentation Agent and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Payment under this indemnification shall be made within thirty (30) days after
the date any Bank or the Documentation Agent makes written demand therefor.
(c) If the Company shall be required by law to deduct or withhold any
Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Bank or the Documentation Agent, then:
(i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section 3.01) such Bank or the Documentation Agent, as the case
may be, receives an amount equal to the sum it would have received had
no such deductions or withholdings been made;
(ii) the Company shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Company shall also pay to each Bank or the
Documentation Agent for the account of such Bank, at the time interest
is paid, all additional amounts which the respective Bank specifies as
necessary to preserve the after-tax yield such Bank would have received
if such Taxes or Other Taxes had not been imposed.
(d) Within thirty (30) days after its receipt thereof, the Company
shall furnish the Documentation Agent the original or a certified copy of a
receipt evidencing payment of such Taxes or Other Taxes, or other evidence of
payment satisfactory to the Documentation Agent.
(e) Each Bank which is a foreign person (i.e., a person other than a
United States person for United States Federal income tax purposes) agrees that
it will comply with the requirements of Section 9.10 hereof and further agrees
that if such Bank claims or is entitled to claim exemption from withholding tax
under a United States tax treaty by providing a Form 1001 and such Bank sells
or
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grants a participation of all or part of its rights under this Agreement, such
Bank shall notify the Documentation Agent of the percentage amount in which it
is no longer the beneficial owner under this Agreement. To the extent of this
percentage amount, the Company or the Documentation Agent shall treat such
Bank's Form 1001 as no longer in compliance with this Section 3.01(e). In the
event a Bank claiming exemption from United States withholding tax by filing
Form 4224 with the Company or the Documentation Agent sells or grants a
participation in its rights under this Agreement, such Bank agrees to undertake
sole responsibility for complying with the withholding tax requirements imposed
by Sections 1441 and 1442 of the Code.
(f) Notwithstanding anything herein to the contrary, the Company will
not be required to pay any additional amounts in respect of Taxes described
below:
(i) if such Bank shall have delivered to the Company
and the Documentation Agent a Form 4224 or a Form 1001 in respect of
its Lending Office and such Bank shall not at any time be entitled to
exemption from deduction or withholding of United States Federal income
tax in respect of payments by the Company hereunder for the account of
such Lending Office for any reason other than a change in United
States law or regulations or in the official interpretation of such law
or regulations by any governmental authority charged with the
interpretation or administration thereof (whether or not having the
force of law) after the date of delivery of such Form 4224 or Form
1001, as applicable;
(ii) taxes that are imposed as a result of any sale,
assignment, transfer or other disposition (whether voluntary or
involuntary) by such Bank or any interest in such Bank's Commitment,
Loans or the Loan Documents, unless such sale, assignment, transfer or
disposition by such Bank takes place while an Event of Default has
occurred and is continuing or pursuant to Section 3.03(c);
(iii) taxes to the extent resulting from (A) the gross
negligence, fraud or willful misconduct of a Bank or the Documentation
Agent, (B) any act or omission of a Bank or the Documentation Agent
that is in violation of any of the terms of the Loan Documents, or (C)
the inaccuracy or breach of any representation, warranty or covenant by
a Bank or the Documentation Agent in any document required to be
furnished thereby.
(g) If the Company is required to pay additional amounts to any Bank
pursuant to this Section 3.01, then such Bank shall use its reasonable best
efforts (consistent with legal and regulatory restrictions) to change the
jurisdiction of its Lending Office so as to eliminate any such additional
payment by the Company which
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may thereafter accrue if such change in the judgment of such Bank is not
otherwise materially disadvantageous to such Bank.
(h) If any Bank or the Documentation Agent receives a written
notification from a taxing authority of proposed taxes for which an amount may
be payable by the Company in accordance with this Section 3.01, such Bank or
the Documentation Agent shall notify the Company promptly after receipt of such
notification and shall furnish the Company with such related information as the
Company may reasonably request. If requested by the Company in writing, such
Bank or the Documentation Agent shall in good faith diligently contest
(including pursuing all judicial appeals as of right, if any) the validity,
applicability and amount of such Taxes or Other Taxes; provided, that (x) prior
to taking such action the Company shall have agreed to indemnify such Bank or
the Documentation Agent for all reasonable out of pocket costs and expenses
that such indemnitee may incur in connection with contest such claim and (y)
the amount of such claim, when aggregated with all amounts owing to such Bank
under comparable provisions of the Other Credit Facilities to which such Bank
is a party, shall exceed $5,000.
(i) Each Bank receiving a receipt or other evidence of payment pursuant
to Section 3.03(d) shall reimburse the Company for the amount of any credit or
other economic benefit available to such Bank by reason or on account of such
payment by the Company or such Bank's possession of such receipt or other
evidence of payment under any tax, levy, impost, duty, fee, assessment or other
charge of any nature imposed by any Governmental Authority applicable to such
Bank. The amount of such reimbursement calculated by such Bank shall be
conclusive and binding absent manifest error in computation.
3.02 Inability to Determine Rates. If and to the extent that market or
other conditions existing in the domestic money market relevant to CD Rate
Committed Loans or in the London inter-bank market relevant to LIBOR Committed
Loans make it impossible or impracticable for the Banks to make such Loans,
then the obligations of the Banks to make CD Rate Committed Loans or LIBOR
Committed Loans, as applicable, and the right of the Company to originate,
continue or convert any Committed Loan as or to a CD Rate Committed Loan or a
LIBOR Committed Loan shall be suspended until the circumstances giving rise to
such suspension shall no longer exist.
Upon receipt from the Documentation Agent of a notice of the Banks'
inability to make, convert or continue the requested Committed Loan due to any
of the reasons referred to above, notwithstanding anything in this Agreement to
the contrary, the Company may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Company does not revoke
such notice relating to a LIBOR Committed Loan or CD Rate Committed Loan, the
Banks shall, with respect to such LIBOR
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Committed Loan or CD Rate Committed Loan only, make or convert such Loan in the
amount specified in the applicable notice submitted by the Company, but such
Committed Loan shall be made as or converted into a Reference Rate Committed
Loan instead of a LIBOR Committed Loan or a CD Rate Committed Loan. Except as
provided in the immediately preceding sentence, if, notwithstanding the
provisions of this Section 3.02, any Bank has made available to the Company its
Commitment Percentage of any such proposed Loan, then the Company shall
immediately repay the amount so made available to it by such Bank, together
with accrued interest thereon, if any.
3.03 Increased Costs; Capital Adequacy.
(a) If, after the Closing Date, a Bank shall reasonably determine that
any change in applicable laws, rules or regulations or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law):
(i) shall change the basis of taxation to such Bank of any
amounts payable by the Company under this Agreement (other than taxes
imposed on or measured by the overall income of such Bank in the
jurisdiction in which such Bank has its principal office), or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits
with or for the account of, or credit extended by, such Bank with
respect to this Agreement or any Note, or
(iii) shall impose any other condition with respect to this
Agreement or any Note,
and the result of any of the foregoing is to increase the cost to such Bank or
to reduce the amount of any sum receivable by such Bank with respect to making
or maintaining any CD Rate Committed Loan or LIBOR Loan by an amount reasonably
deemed by such Bank to be material, then the Company shall from time to time,
upon written demand by such Bank, pay to such Bank additional amounts
sufficient to compensate such Bank for any such increased cost or reduced sum
receivable to the extent resulting from outstanding CD Rate Committed Loans or
LIBOR Loans and not compensated in connection with the computation of the CD
Rate or LIBOR (as applicable).
(b) If any Bank shall have determined that (i) the introduction of any
Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance
by such Bank (or its Lending Office) with any such change in Capital Adequacy
Regulations, affects or would affect the amount of capital
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required or expected to be maintained by such Bank and (taking into
consideration such Bank's policies with respect to capital adequacy and such
Bank's desired return on capital) determines that the amount of such capital is
increased by an amount deemed material by such Bank as a consequence of its
Commitment, Loans (other than Reference Rate Committed Loans) or other
obligations under this Agreement, then, upon demand of such Bank to the Company
through the Agent, the Company shall pay to such Bank, from time to time as
specified by such Bank, additional amounts sufficient to compensate for such
increase.
(c) Upon receipt of notice from any Bank of a claim for compensation
under this Section 3.03, the Company shall be afforded ninety (90) days to find
a replacement financial institution reasonably acceptable to the Documentation
Agent and, if an acceptable replacement financial institution is available such
replacement institution will purchase such Bank's Committed Loans and
Commitment and other interests under the Loan Documents in accordance with
Section 10.08 or such Bank will withdraw such request for payment.
(d) A detailed statement as to the amount of such increased cost or
reduced sum receivable, along with documentation supporting the payment of such
amount under this subsection, shall be prepared by such Bank and submitted to
the Company (with a copy to the Documentation Agent) with such Bank's written
demand. Such Bank's statement of such increased cost or reduced sum receivable
shall be prima facie evidence of such increased cost or reduced sum absent
manifest error.
3.04 Illegality.
(a) If any Bank shall determine that, after the date hereof, (i) the
introduction of any Requirement of Law or any change in or in the
interpretation or administration thereof has made it unlawful, or (ii) any
central bank or other Governmental Authority has asserted that it is unlawful,
for such Bank or its Lending Office to make any Loan of the Type requested by
the Company (including in respect of any Competitive Bid Loan as to which the
Company has accepted such Bank's Competitive Bid, but which has not been
funded), then, on notice thereof by such Bank to the Company through the
Documentation Agent, the obligation of such Bank to make any such Loans shall
be suspended until such Bank shall have notified the Documentation Agent and
the Company that the circumstances giving rise to such determination no longer
exists.
(b) If a Bank shall determine that it is unlawful to maintain any Loan
then outstanding, then, on notice thereof by such Bank to the Company through
the Documentation Agent, the Company shall prepay in full all such Loans of
such Bank then outstanding, together with interest accrued thereon, either on
the last day of the Interest Period thereof if such Bank may lawfully continue
to
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maintain such Loans to such day, or immediately, if such Bank may not lawfully
continue to maintain such Loans.
(c) If the Company is required to prepay any LIBOR Committed Loan
or CD Rate Committed Loan as provided in Section 3.04 (b), then concurrently
with such prepayment, the Company shall borrow from the affected Bank, in the
amount of such repayment, a Reference Rate Committed Loan.
3.05 Funding Losses. The Company agrees to reimburse each Bank and to
hold each Bank harmless from any loss, cost or expense which such Bank may
sustain or incur as a consequence of:
(a) any failure by the Company to borrow, or to continue or convert
a Committed Loan (other than a Reference Rate Committed Loan) after it has
given (or is deemed to have given) a Notice of Borrowing or a Notice of
Conversion/Continuation, as the case may be;
(b) any payment by it of a LIBOR Loan or a CD Rate Committed Loan
or Absolute Rate Bid Loan on a day which is not the last day of the Interest
Period with respect thereto;
(c) the conversion of a LIBOR Committed Loan or a CD Rate Committed
Loan to a Reference Rate Committed Loan on a day that is not the last day of
the respective Interest Period pursuant to Section 2.04; or
(d) any failure by it to borrow any Competitive Bid Loan after
accepting the applicable Competitive Bid;
by paying to each Bank, on demand by such Bank, an additional amount equal to
the amount of any interest which such Bank would have earned for the remainder
of the Interest Period in question reduced by the amount of income earned by
such Bank during such Interest Period with respect to the amount prepaid or not
borrowed (the "Loss"). A detailed statement as to the amount of such Loss,
prepared by the Bank incurring the same, shall be prima facie evidence of such
Loss absent manifest error.
3.06 Survival. The agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
ARTICLE IV
CONDITIONS PRECEDENT
4.01 Conditions to Occurrence of the Closing Date and Effectiveness of
this Agreement. The occurrence of the Closing Date and the binding effect of
this Agreement on each Bank are
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subject to the condition that the Documentation Agent shall have received on
or before the Closing Date all of the following, in form and substance
satisfactory to the Documentation Agent and each Bank, in sufficient copies
for each Bank:
(a) Credit Agreement. This Agreement executed by the Company, the
Documentation Agent and each of the Banks;
(b) By-laws; Resolutions; Incumbency.
(i) Copies of the by-laws of the Company and of the
resolutions of the board of directors of the Company approving and
authorizing the execution, delivery and performance by the Company of
this Agreement and the other Loan Documents to be delivered hereunder,
and authorizing the borrowing of the Loans, each certified as of the
Closing Date by the Secretary or an Assistant Secretary of the Company;
and
(ii) A certificate of the Secretary or Assistant Secretary
of the Company certifying the names and true signatures of its
respective officers authorized to execute and deliver and perform, as
applicable, this Agreement and all other Loan Documents and notices to
be delivered by it hereunder;
(c) Articles of Incorporation. (i) A copy of the Company's
Articles of Incorporation as in effect on the Closing Date, including any
amendments thereto, certified by the Michigan Department of Commerce, and
(ii) good standing certificates for the Company from the Michigan
Department of Commerce and from the Secretaries of State of California and
New York, each dated not earlier than October 1, 1994 and not more than
seven (7) days prior to the Closing Date;
(d) Legal Opinions.
(i) an opinion of A.N. Xxxxxxx, counsel to the Company, and
addressed to the Documentation Agent and the Banks, substantially in
the form of Exhibit H-1; and
(ii) an opinion of Dickinson, Wright, Moon, Van Dusen &
Xxxxxxx, special counsel to the Company and addressed to the
Documentation Agent and the Banks in substantially the form of
Exhibit H-2;
(e) Payment of Transaction Fees and Expenses. Evidence of payment
of all costs, accrued and unpaid fees and expenses (including Attorney
Costs) to the extent then due and payable on the Closing Date;
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(f) Certificate. A certificate signed by a Responsible Officer of
the Company, dated as of the Closing Date, stating that:
(i) the representations and warranties of the Company
contained in Article V are true and correct on and as of such date, as
though made on and as of such date;
(ii) no Potential Default or Event of Default exists as of
the date of such certificate;
(iii) no material adverse change in the assets, liabilities,
business, operations or condition of the Company and its Subsidiaries
has occurred since January 26, 1994;
(iv) no default has occurred and is continuing in respect of
any Indebtedness of the Company and its Subsidiaries with an aggregate
principal amount in excess of $100,000,000;
(v) all consents and approvals required to consummate the
transactions contemplated by this Agreement have been obtained or
waived; and
(vi) the Existing Facilities have been terminated and all
Indebtedness outstanding thereunder has been satisfied;
(g) Financial Statements. The financial statements of the Company
referred to in Section 5.06;
(h) Other Credit Facilities. The Company shall have entered into
the Other Credit Facilities and the conditions to closing thereunder shall
have been satisfied; and
(i) Other Documents. Such other approvals, opinions or documents
as the Documentation Agent may reasonably request.
4.02 Conditions to All Borrowings and Letter of Credit Issuances. The
obligation of each Bank to make any Committed Loan to be made by it
hereunder, or any Competitive Bid Loan as to which the Company has accepted
the relevant Competitive Bid (including its initial Loan) and of any Facing
Agent to issue a Letter of Credit hereunder is subject to the satisfaction of
the following conditions precedent on the relevant Borrowing Date:
(a) Notice of Borrowing or Issuance. In the case of any Committed
Loan, the Documentation Agent shall have received a Notice of Borrowing and
executed Notes evidencing the requested Loans to the extent required hereby
and in the case
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of any Letter of Credit issuance, the Facing Agent shall have
received a Letter of Credit Request;
(b) Continuation of Representations and Warranties. The
representations and warranties made by the Company contained in Article
V shall be true and correct on and as of such Borrowing Date with the
same effect as if made on and as of such Borrowing Date (except to the
extent such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct as of such
earlier date); and
(c) No Existing Default. No Potential Default or Event of
Default shall exist or shall result from such Borrowing or issuance of
such Letter of Credit.
Each Notice of Borrowing, Competitive Bid Request and Letter of Credit
Request submitted by the Company hereunder shall constitute a representation
and warranty by the Company, as of the date of each such notice or request and
as of the Borrowing Date relating thereto, that the conditions in Section 4.02
are satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Documentation Agent and each
Bank that:
5.01 Organization and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, and is duly qualified to do business and is
in good standing in each additional jurisdiction where failure to so qualify
would have an effect which, when taken together with the simultaneous effect of
failure to qualify in any other jurisdictions, would in the aggregate have a
Material Adverse Effect.
5.02 Authorization; No Contravention. The execution, delivery and
performance of this Agreement and the issuance of the Notes by the Company are
within its corporate powers, have been duly authorized by all necessary
corporate action, and are not in contravention of any Requirement of Law or of
the terms of the Company's Articles of Incorporation or by-laws, or of any
agreement, undertaking, contract or other obligation to which the Company is a
party or by which it is bound.
5.03 Consents and Approvals. No consent, waiver, approval, notification
of, or registration or filing with, any Governmental Authority or any
non-governmental Person is required in connection with the execution and
delivery by the Company of this Agreement or
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any Notes or the borrowing by the Company hereunder or in connection with the
consummation of any transaction contemplated hereby, except those disclosed in
Schedule 5.03 and which the Company has obtained or made.
5.04 Binding Effect. This Agreement is, and each Note when issued will
be, valid, binding and enforceable against the Company in accordance with the
terms thereof (subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws relating to
or affecting the enforcement of creditors' rights and general equitable
principles which may limit the right to obtain the remedy of specific
performance of executory covenants and other equitable remedies).
5.05 Litigation. No litigation or governmental proceeding is pending
or, to the knowledge of the Company, threatened, against the Company for which
sufficient provision has not been made in the financial statements of the
Company and which could have a material adverse effect on the Company's
condition or business, financial or otherwise, or which purport to affect or
pertain to this Agreement or any of the transactions contemplated hereby.
5.06 Financial Statements. The balance sheet dated as of January 26,
1994 and the related statements of income and stockholders' equity and cash
flows, of the Company and its Subsidiaries contained in the annual report of
the Company to its stockholders have been audited and certified by Price
Waterhouse, independent certified public accountants, and are complete and
accurate in all material respects and present fairly the financial condition of
the Company and its Subsidiaries as of the dates of such statements and the
results of their operations for the periods covered thereby, in accordance with
GAAP, consistently applied. The balance sheet dated as of July 27, 1994 and the
related statements of income, stockholders' equity and cash flows of the
Company and its Subsidiaries contained in the quarterly report of the Company
filed with the U.S. Securities and Exchange Commission (the "SEC") on Form 10-Q
are complete and accurate in all material respects and present fairly the
financial condition of the Company and its Subsidiaries as of the dates of such
statements and the results of their operations for the periods covered thereby,
in accordance with GAAP, consistently applied.
5.07 Use of Proceeds; Margin Regulations. After applying the proceeds
of any borrowings hereunder, not more than 25% of the value of the assets of
the Company and its Subsididaries will consist of "margin stock" as such term
is defined in Regulation G, T, U or X of the Federal Reserve Board. The Company
is not generally engaged in the business of purchasing or selling margin stock
or extending credit for the purpose of purchasing or carrying margin stock.
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5.08 No Default. No Potential Default or Event of Default exists or would
result from the incurring of any Obligations by it.
5.09 Taxes. The Company has filed all Federal and other material tax
returns and reports required to be filed, and has paid all Federal and other
material taxes, assessments, fees and other governmental charges levied or
imposed upon it or its properties, income or assets otherwise due and payable,
except those which are being contested in good faith by appropriate proceedings
and for which adequate reserves have been provided in accordance with GAAP.
There is no proposed tax assessment against the Company that could, if made,
have a Material Adverse Effect.
5.10 Insurance. The properties and business of the Company are insured in
such amounts, with such deductibles and covering such risks as are customarily
carried by similar companies of comparable size engaged in similar businesses
and owning or operating similar properties in localities where the Company
operates.
5.11 Compliance With Laws. The Company is in compliance with all
applicable laws, rules and regulation (including environmental laws, rules and
regulations and the Employee Retirement Income Security Act of 1976, as
amended, and all regulations thereunder) except where the failure to be in such
compliance could not reasonably be expected to have a Material Adverse Effect.
ARTICLE VI
AFFIRMATIVE COVENANTS
The Company covenants and agrees that, so long as any Bank shall have any
Commitment hereunder, or any Loan or other Obligation shall remain unpaid or
unsatisfied:
6.01 Payment of Taxes. The Company will pay, when due, all taxes assessed
against the Company or its property and all other claims which may become a
Lien upon any of its property, except to the extent that (a) the same are being
contested in good faith by appropriate proceedings, and (b) adequate reserves
for payment thereof have been established in accordance with GAAP.
6.02 Insurance. The Company shall maintain insurance with respect to its
properties and business in such amounts, with such deductibles and covering such
risks as are customarily carried by similar companies of comparable size
engaged in similar businesses and owning or operating similar properties in
localities where the Company operates.
6.03 Preservation of Corporate Existence, Etc. The Company shall:
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(a) preserve and maintain in full force and effect its
corporate existence and good standing under the laws of its state
or jurisdiction of incorporation; and
(b) preserve and maintain in full force and effect all
governmental rights, privileges, qualifications, permits, licenses
and franchises necessary or desirable in the normal conduct of its
business except in connection with transactions permitted by Section
7.01 and dispositions of assets permitted by Section 7.02.
6.04 Maintenance of Property. The Company shall maintain and preserve
all its property which is used or useful in its business in good working order
and condition, ordinary wear and tear excepted, and make all necessary repairs
thereto and renewals and replacements thereof except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect, and except
as permitted by Section 7.02.
6.05 Compliance with Laws. The Company shall comply in all material
respects with all Requirements of Law of any Governmental Authority having
jurisdiction over it or its business, except such as may be contested in good
faith or as to which a bona fide dispute may exist.
6.06 Books and Records; Other Information. The Company shall maintain
proper books of record and account in which full, true and correct entries in
conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of the Company, and
will provide to the Documentation Agent and the Banks such other information as
they may reasonably request and which is reasonably available to the Company or
can be reasonably computed from the Company's books and records.
6.07 Financial Information. The Company shall deliver to the
Documentation Agent for distribution to the Banks (and, if requested, with
sufficient copies for each Bank):
(a) within sixty (60) days after the end of each of
the first three (3) fiscal quarters of the Company, copies of (i)
the consolidated balance sheet of the Company and its Subsidiaries as
of the end of such quarter, (ii) the consolidated statement of income
of the Company and its Subsidiaries for such quarter and for the period
from the end of the most recent fiscal year of the Company through the
end of such quarter, (iii) the consolidated statement of cash flows of
the Company and its Subsidiaries for the period from the end of the
most recent fiscal year of the Company through the end of such quarter,
all prepared in accordance with GAAP and certified by a Responsible
Officer as being a fair
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statement of results for the periods covered thereby; subject to ordinary
year-end audit adjustments;
(b) concurrently with the delivery of the financial statements referred
to in Sections 6.07(a) and (c), a certificate duly completed and executed by a
Responsible Officer, as to compliance by the Company with the covenants
contained in Sections 7.04 and 7.05 hereof, and stating that no Potential
Default or Event of Default then exists (or, if any should then exist,
identifying the same and stating any actions being taken by the Company with
respect thereto);
(c) within one hundred twenty (120) days after the end of each fiscal
year of the Company, copies of (i) the consolidated balance sheet of the
Company and its Subsidiaries as at the end of such fiscal year, (ii) the
consolidated statement of income of the Company and its Subsidiaries for such
fiscal year, and (iii) the consolidated statement of cash flows of the Company
and its Subsidiaries for such fiscal year, setting forth in each case in
comparative form the corresponding figures for the previous fiscal year, all in
reasonable detail and prepared in accordance with GAAP and certified by a
nationally recognized independent public accounting firm; and
(d) promptly, copies of all financial statements and reports that the
Company sends to its shareholders and copies of all Forms 10K, 10Q and 8K that
the Company files with the SEC.
6.08 Notices.
(a) The Company shall notify each Bank promptly, but not later than
three (3) Business Days after the Company becomes aware thereof, of the
occurrence of any Event of Default.
(b) The Company shall notify the Documentation Agent for distribution to
the Banks promptly, but not later than three (3) Business Days after the
Company becomes aware thereof, of the occurrence of:
(i) any Potential Default;
(ii) any Material Adverse Effect or any event or other
development which could have a Material Adverse Effect;
(iii) any change in the Debt Rating by Xxxxx'x or S&P; or
(iv) any Reportable Event.
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ARTICLE VII
NEGATIVE COVENANTS
The Company hereby covenants and agrees that, so long as any Bank shall
have any Commitment hereunder, or any Loan or other Obligation shall remain
unpaid or unsatisfied:
7.01 Consolidations and Mergers. The Company shall not merge or
consolidate with any other Person, unless:
(a) the successor formed by or resulting from such
consolidation or merger is the Company or a Subsidiary of the Company
(and, if the survivor is a Subsidiary of the Company, such Subsidiary
shall affirm the Company's Obligations under the Loan Documents in
writing), and
(b) no Event of Default or Potential Default shall have
occurred and then be continuing or would arise after giving effect
thereto.
7.02 Disposition of Assets. The Company shall not, directly or
indirectly, sell, assign, lease, convey, transfer or otherwise dispose of
(whether in one or a series of transactions) any property (including accounts
and notes receivable, with or without recourse) or enter into any agreement to
do any of the foregoing except:
(a) dispositions of inventory, or used, worn-out or surplus equipment,
all in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied
to the purchase price of such replacement equipment;
(c) dispositions of inventory or equipment by the Company to any
Subsidiary pursuant to reasonable business requirements; and
(d) other dispositions of assets having, in any fiscal year of the
Company, an aggregate book value not exceeding 10% of the Company's
consolidated total assets as of the end of the most recently ended
fiscal year of the Company, as reflected in the Company's balance sheet
contained in its audited financial statements for such fiscal year;
provided, however, that this Section 7.02 shall not be deemed to prohibit the
sale of all, substantially all, or a part of the
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capital stock or of all, substantially all, or a part of the assets of any
Specialty Retail Subsidiary of the Company, even if such an entity is no longer
a Subsidiary of the Company, if (x) consideration received is fair market value
(as determined by the Company), or (y) the Company's board of directors deems
such transaction to be necessary by reason of applicable laws, regulations or
governmental policies applicable to the Company.
7.03 Limitation on Liens. The Company shall not incur any
Indebtedness which is secured by a Lien on any assets of the Company, whether
now owned or hereafter acquired, unless, concurrently with creation of any such
Lien securing Indebtedness in an aggregate amount of $50,000,000 or more, the
Company shall cause the Obligations and its obligations under the Other Credit
Facilities to be equally and ratably secured by the same assets, provided,
however, that such restriction shall not apply with respect to any of the
following types of Liens:
(a) Liens for taxes not delinquent or being contested in good
faith:
(b) Liens created in connection with workers'
compensation, unemployment insurance and other social security
legislation, or to secure the performance of bids, tenders, contracts
(other than for the repayment of borrowed money), statutory
obligations, surety and appeal bonds and other similar obligations
incurred in the ordinary course;
(c) purchase money mortgages (including vendors' rights under
purchase or land contracts or under other agreements whereby
title or other interest is retained by the vendor for the purpose of
securing the purchase price thereof) on property acquired or
constructed after the Closing Date, or the acquisition after the
Closing Date of property subject to such a Lien which is limited to
such property and was not created in anticipation of such acquisition;
(d) mortgages on real property which is the sole security for
Indebtedness the amount of which does not exceed the greater of
the cost of such property and improvements or the fair market value
thereof;
(e) mortgages, security interests and Liens on assets of the
Company existing on the Closing Date and set forth on Schedule
7.03, or any refundings or extensions for an amount not exceeding the
principal amount of such Indebtedness and applying only to the same
property or assets; and
(f) mortgages, security interests and Liens in connection with
indebtedness under industrial revenue bond financings or
similar government agency supported financings.
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7.04 EBITDAR Coverage Ratio. The Company shall not permit its ratio of
(a) EBITDAR (measured as of the end of any fiscal quarter
ending after the Closing Date for the four fiscal quarters then ended)
to
(b) the sum of (i) consolidated net interest expense for such
four fiscal quarter period plus (ii) consolidated Rent Expense for
such four fiscal quarter period
to be less than 1.50 to 1.00.
7.05 Consolidated Net Worth. The Company shall not permit its
Consolidated Net Worth at any time to be less than Four Billion Five Hundred
Million Dollars ($4,500,000,000).
ARTICLE VIII
EVENTS OF DEFAULT
8.01 Event of Default. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment of Principal. The Company fails to pay, when
and as required to be paid herein, any amount of principal of any Loan
and such default shall continue unremedied for a period of two (2)
Business Days after the date upon which notice thereof is received by
the Company from the Documentation Agent; or
(b) Non-Payment of Interest or Fees. The Company fails to pay,
when and as required to be paid herein, any interest or any fees
payable hereunder and such default shall continue unremedied for a
period of five (5) Business Days after the date upon which notice
thereof is received by the Company from the Documentation Agent; or
(c) Specific Defaults. The Company fails to perform or observe
any term, covenant or agreement contained in Sections 6.02, 6.03,
6.08(a), 7.01, 7.02 and 7.03; or
(d) Other Defaults. The Company fails to perform or observe any
other term or covenant contained in this Agreement and such default
shall continue unremedied for a period of thirty (30) days after the
date upon which written notice thereof is given to the Company by the
Documentation Agent or any Bank; or
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(e) Representation or Warranty. Any representation or warranty by the
Company made or deemed made herein proves to have been inaccurate or untrue in
any material respect on or as of the date made or deemed made; or
(f) Cross-Default; Cross-Acceleration. (i) The Company fails to make
any payment of principal or interest or fees under any of the Other Credit
Facilities when due after taking into account any applicable grace periods, or
(ii) by reason of any action taken by the Company with the intent and capacity
promptly to satisfy any obligation of the Company resulting therefrom,
including, without limitation, the calling for payment by the Company of any of
its Indebtedness or the termination by the Company of any of its guaranty
obligations, any Indebtedness shall mature or be declared due and payable prior
to its stated maturity and such Indebtedness shall remain unpaid for a period
of two (2) Business Days thereafter, or (iii) the Company fails to perform or
observe any condition or covenant or any other event shall occur or condition
exist (other than with respect to matters described under clause (ii)
immediately preceding) relating to Indebtedness (other than Indebtedness under
the Other Credit Facilities) having an aggregate principal amount (including
undrawn committed or available amounts) of more than One Hundred Million
Dollars ($100,000,000) if the effect of any such failure, event or condition is
to cause such Indebtedness to be declared to be due and payable or otherwise
become due and payable prior to its stated maturity, or (iv) the Company fails
to pay any such other Indebtedness in full at its stated maturity; or
(g) ERISA. The occurrence of a Reportable Event which the PBGC deems
grounds to terminate any employee pension benefit plan or for the appointment
of a trustee to administer such plan and such Reportable Event is not corrected
and such determination by the PBGC is not revoked within thirty (30) days after
notice thereof; or the institution of proceedings by the PBGC to terminate any
such plan; or the appointment of a trustee to administer any such plan; or
(h) Monetary Judgments. A final judgment or judgments in excess of One
Hundred Million Dollars ($100,000,000) shall be entered against the Company by
a court of record and not discharged in accordance with its terms or, within
sixty (60) days from the date of entry thereof, stayed from execution and
(within said period of sixty (60) days or such longer period during which
execution of such judgment(s) shall have been stayed) appeal taken therefrom
and execution thereof stayed during such appeal; or
(i) Insolvency; Voluntary Proceedings. The Company (i) generally fails
to pay, or admits in writing its inability to
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pay, its debts as they become due, subject to applicable grace
periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course;
(iii) commences any Insolvency Proceeding with respect to itself; or
(iv) takes any action to effectuate or authorize any of the foregoing;
or
(j) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company, or any writ,
judgment, warrant of attachment, execution or similar process, is
issued or levied against a substantial part of the Company's
properties, and any such proceeding or petition is not dismissed, or
such writ, judgment, warrant of attachment, execution or similar
process is not released, vacated or fully bonded within 60 days after
commencement, filing or levy; (ii) the Company admits the material
allegations of a petition against it in any Insolvency Proceeding, or
an order for relief is entered in any Insolvency Proceeding; or (iii)
the Company acquiesces in the appointment of a receiver, trustee,
custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion
of its business.
8.02 Remedies. If any Event of Default occurs, the Documentation Agent
shall, at the request of, or may, with the consent of, the Required Banks,
(a) declare the Commitment of each Bank to make Committed Loans
and to issue Letters of Credit to be terminated, whereupon such
Commitments shall forthwith be terminated;
(b) declare the unpaid principal amount of all outstanding
Loans, all interest accrued and unpaid thereon, and all other amounts
owing or payable hereunder or under any other Loan Document to be
immediately due and payable; without presentment, demand, protest or
other notice of any kind, all of which are hereby expressly waived by
the Company; and
(c) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or
applicable law;
provided, that upon the occurrence of any event specified in Section 8.01(i) or
8.01(j) above (upon the expiration of the 60-day period mentioned therein, if
applicable), the Commitment of each Bank shall automatically terminate and the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable without further
act of the Documentation Agent or any Bank. If any Bank which made a
Competitive Bid Loan shall suffer an Event of Default
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under Section 8.01(a) due to the Company's failure to pay any amount of
principal on any Competitive Bid Loan, such Bank may send a written request to
the Documentation Agent to obtain approval of the Required Banks to terminate
the Commitments and, if such approval is not obtained within ten (10) Business
days after the date such request is received, the requesting Bank (or assignee)
may commence enforcement of such default by any and all legal means. Any
payments received after the Banks have taken action pursuant to Section 8.02(b)
shall be allocated ratably among the Committed Loans.
In addition to the foregoing, following the occurrence and during the
Continuance of an Event of Default, so long as any Letter of Credit has not
been fully drawn and has not been cancelled or expired by its terms, upon
demand by the Documentation Agent, the Company shall deposit in an account (the
"Letter of Credit Cash Collateral Account") maintained with BofA in the name of
the Documentation Agent, for the ratable benefit of the Banks and the
Documentation Agent, cash in an amount equal to the aggregate undrawn face
amount of all outstanding Letters of Credit and all fees and other amounts due
or which may become due with respect thereto. The Company shall have no control
over funds in the Letter of Credit Cash Collateral Account, which funds shall
be invested by the Documentation Agent from time to time in certificates of
deposit of BofA having a maturity not exceeding thirty days. Such funds shall
be promptly applied by the Documentation Agent to reimburse the Facing Agent
for drafts drawn from time to time under such Letters of Credit, and if there
are insufficient funds available to reimburse the Facing Agent for all such
drafts, then such funds shall be applied ratably in accordance with the Stated
Amounts of the related Letters of Credit. Such funds, if any, remaining in the
Letter of Credit Cash Collateral Account following the payment of all
Obligations in full or the earlier termination of all Events of Default shall,
unless the Documentation Agent is otherwise directed by a court of competent
jurisdiction, be promptly paid over to the Company.
8.03 Rights Not Exclusive. The rights provided for in this Agreement
and the Other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE IX
THE DOCUMENTATION AGENT
9.01 Appointment and Authorization. Each Bank hereby irrevocable
(except as otherwise set forth in Section 9.09) appoints, designates and
authorizes the Documentation Agent to take such action on its behalf under the
provisions of this Agreement
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and each other Loan Document and to exercise such poweres and perform such
duties as are expressly delegated to it by the terms of this Agreement or any
other Loan Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained elsewhere in
this Agreement or in any other Loan Document, the Documentation Agent shall not
have any duties or responsibilities, except those expressly set forth herein,
nor shall the Documentation Agent have or be deemed to have any fiduciary
relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Documentation Agent.
9.02 Delegation of Duties. The Documentation Agent may execute any of
its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Documentation
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
9.03 Liability of Agent-Related Persons. No Agent-Related Persons shall
(i) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own negligence under or breach
or default of its obligations under this Agreement), or (ii) be responsible in
any manner to any of the Banks for any recital, statement, representation or
warranty made by the Company or any Subsidiary or Affiliate of the Company, or
any officer thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other document referred
to or provided for in, or received by the Documentation Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other loan document, or for any failure of the Company or any other party
to any Loan Document to preform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Bank to ascertain
or to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or
to inspect the Properties, books or records of the Company or any the
Company's Subsidiaries or Affiliates.
9.04 Reliance by Documentation Agent.
(a) The Documentation Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and
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upon advice and statements of legal counsel (including counsel to the Company),
independent accountants and other experts selected by the Documentation Agent.
The Documentation Agent shall be fully justified in failing or refusing to take
any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of the Required Banks as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Documentation Agent shall in all cases by fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of all of the Banks or the Required Banks,
as applicable, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with each
document or other matter either sent by the Documentation Agent to such Bank
for consent, approval, acceptance or satisfaction or required thereunder to be
consented to or approved by or acceptable or satisfactory to the Bank.
9.05 Notice of Default. The Documentation Agent shall not be deemed
to have knowledge or notice of the occurrence of any Potential Default or Event
of Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Documentation Agent for the
account of the Banks, unless the Documentation Agent shall have received
written notice from a Bank or the Company referring to this Agreement,
describing such Potential Default or Event of Default and stating that such
Notice is a "notice of default". The Documentation Agent will notify the Banks
of its receipt of any such notice. The Documentation Agent shall take such
action with respect to such Potential Default or Event of Default as shall be
requested by the Required Banks in accordance with Article VIII; provided,
however, that unless and until the Documentation Agent has received any such
request, the Documentation Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Potential
Default or Event of Default as it shall deem advisable or in the best interest
of the Banks.
9.06 Credit Decision. Each Bank expressly acknowledges that none of
the Agent-Related Persons has made any representation or warranty to it and
that no act by the Documentation Agent hereinafter taken, including any review
of the affairs of the Company and its Subsidiaries shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any
Bank. Each Bank represents to the Documentation Agent that it has,
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independently and without reliance upon any Agent-Related Person and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company and
its Subsidiaries, and all applicable bank regulatory laws relating to the
transactions contemplated hereby and made its own decision to enter into this
Agreement and extend credit to the Company hereunder. Each Bank also represents
that it will, independently and without reliance upon any Agent-Related Person
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigations as it deems necessary to inform itself as to
the business, prospects, operations, property, financial and other condition
and creditworthiness of the Company. Except for notices, reports and other
documents expressly herein required to be furnished to the Banks by the
Documentation Agent, the Documentation Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Company which may come into the possession
of any of the Agent-Related Persons.
9.07 Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Banks shall indemnify upon demand the Agent-Related
Persons (to the extent not reimbursed by or on behalf of the Company and
without limiting the obligation of the Company to do so), pro rata (as
determined in accordance with their respective Commitment Percentages) from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses and disbursements of any kind
whatsoever which may at any time (including at any time following the repayment
of the Loans) be imposed on, incurred by or asserted against any such Person
any way relating to or arising out of this Agreement or any document
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by any such
Person under or in connection with any of the foregoing; provided, however,
that no Bank shall be liable for the payment to the Agent-Related Persons of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting solely
from such Person's gross negligence or willful misconduct. Without limitation
of the foregoing, each Bank shall reimburse the Documentation Agent upon demand
for its ratable share of any costs or out-of-pocket expenses (including
Attorney Costs) incurred by the Documentation Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein
to the extent
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that the Documentation Agent is not reimbursed for such expenses by or on
behalf of the Company. The obligation of the Banks in this Section 9.07 shall
survive the payment of all Obligations hereunder and the resignation or
replacement of the Documentation Agent.
9.08 Documentation Agent in Individual Capacity. BofA and its
Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other business with
the Company and its Affiliates as though BofA were not the Documentation Agent
hereunder and without notice to or consent of the Banks. The Banks acknowledge
that, pursuant to such activities, BofA or its Affiliates may receive
information regarding the Company or its Subsidiaries and Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Company or such Subsidiary or Affiliate) and acknowledge that the Documentation
Agent shall be under no obligation to provide such information to them. With
respect to its Loans, the Documentation Agent shall have the same rights and
powers under this Agreement as any other Bank and may exercise the same as
though it were not the Documentation Agent and the terms "Bank" and "Banks"
shall include BofA in its individual capacity.
9.09 Successor Documentation Agent. The Documentation Agent may, and at
the request of the Required Banks shall, resign as Documentation Agent, upon
thirty days' notice to the Banks and the Company. If the Documentation Agent
resigns under this Agreement, the Required Banks shall appoint from among the
Banks a successor Documentation Agent which successor Documentation Agent shall
be subject to the reasonable approval of the Company, provided no Event of
Default then exists. If no successor Documentation Agent is appointed prior
to the effective date of the resignation of the resigning Documentation Agent,
the Documentation Agent may appoint, after consulting with the Banks and
subject to the approval of the Company, a successor Documentation Agent from
among the Banks. Upon the acceptance of its appointment as successor
Documentation Agent hereunder, such successor Documentation Agent
shall succeed to all the rights, powers and duties of the retiring
Documentation Agent and the term "Documentation Agent" shall mean such
successor Documentation Agent and the retiring Documentation Agent's
appointment, rights, powers and duties in such capacity shall be terminated.
After any retiring Documentation Agent's resignation hereunder as
Documentation Agent, the provisions of this Article IX and Sections 10.04 and
10.05 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was the Documentation Agent under this Agreement. If no
successor Documentation Agent has accepted appointment as Documentation Agent
by the date which is thirty days following a retiring Documentation Agent's
notice of resignation, the retiring Documentation Agent's notice of resignation
shall nevertheless thereupon become effective and the Banks shall perform all
of the duties of the Documentation
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Agent until such time, if any, as the Required Banks appoint a successor
Documentation Agent as provided for above.
9.10 Withholding Tax.
(a) If any Bank is a "foreign corporation, partnership or trust" within
the meaning of the Code and such Bank claims exemption from, or a reduction of,
U.S. withholding tax under Sections 1441 or 1442 of the Code, such Bank agrees
with and in favor of the Documentation Agent, to deliver to the Documentation
Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two (2) properly
completed and executed originals of IRS Form 1001 ("Form 1001") before
the payment of any interest in the first calendar year and before the
payment of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Bank, two (2) properly completed and executed originals of IRS Form
4224 ("Form 4224") before the payment of any interest is due in the
first taxable year of such Bank and in each succeeding taxable year of
such Bank during which interest may be paid under this Agreement; and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Documentation Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form 1001 and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of the Company to such Bank, such Bank agrees to notify the
Documentation Agent of the percentage amount in which it is no longer the
beneficial owner of Obligations of the Company to such Bank. To the extent of
such percentage amount, the Documentation Agent will treat such Bank's Form
1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding tax by
filing IRS Form 4224 with the Documentation Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company to such
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Bank, such Bank agrees to undertake sole responsibility for complying with the
withholding tax requirements imposed by Sections 1441 and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Documentation Agent may withhold from any interest payment
to such Bank an amount equivalent to the applicable withholding tax after
taking into account such reduction. If the forms or other documentation
required by subsection (a) of this Section are not delivered to the
Documentation Agent, then the Documentation Agent may withhold from any
interest payment to such Bank not providing such forms or other documentation
an amount equivalent to the applicable withholding tax.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Documentation Agent did
not properly withhold tax from amounts paid to or for the account of any Bank
(because the appropriate form was not delivered or properly executed, because
such Bank failed to notify the Documentation Agent of a change in circumstances
which rendered the exemption from, or reduction of, withholding tax
ineffective, or for any other reason) such Bank shall indemnify the
Documentation Agent fully for all amounts paid, directly or indirectly, by the
Documentation Agent as tax or otherwise, including penalties and interest, and
including any taxes imposed by any jurisdiction on the amounts payable to the
Documentation Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Banks under this subsection
shall survive the payment of all Obligations and the resignation or replacement
of the Documentation Agent.
ARTICLE X
MISCELLANEOUS
10.01 Amendments and Waivers. No amendment or waiver of any provision
of this Agreement or any other Loan Document, and no consent with respect to
any departure by the Company therefrom, shall be effective unless the same
shall be in writing and signed by the Required Banks and acknowledged in
writing by the Documentation Agent, and then such waiver shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however, that no such waiver, amendment, or consent shall, unless in
writing and signed by all the Banks, do any of the following:
(a) increase the Commitment of any Bank;
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(b) postpone or delay any date fixed for any payment of
principal, interest, fees or other amounts due hereunder or under any
Loan Document;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or of any fees or other amounts payable hereunder
or under any Loan Document;
(d) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans which shall be required
for the Banks or any of them to take any action hereunder;
(e) amend this Section 10.01 or Section 2.12;
(f) extend the Termination Date or permit any Letter of Credit
to have an expiry date beyond the Termination Date; or
(g) amend the definition of "Required Banks";
provided, further, that no amendment, waiver or consent shall, unless
in writing and consented to and signed by the Documentation Agent, in addition
to the Required Banks or all the Banks, as the case may be, affect the rights
or duties of the Documentation Agent under this Agreement or any other Loan
Document.
10.02 Notices.
(a) All notices, requests and other communications provided for
hereunder shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission) and mailed, faxed, or delivered,
(i) if to the Company, to its address specified on the signature pages hereof,
(ii) if to any Bank, to its Lending Office, and (iii) if to the Documentation
Agent, to its address specified on the signature pages hereof; or (iv) as to
any party to such other address as shall be designated by such party in a
written notice to the other parties.
(b) All such notices and communications shall, when transmitted by
overnight delivery or by facsimile, be effective when delivered for overnight
delivery or transmitted by facsimile (to be promptly confirmed by sender by
telephone), respectively, or if delivered, upon delivery, except that notices
pursuant to Article II or VIII shall not be effective until actually received
by the Documentation Agent.
(c) The Company acknowledges and agrees that any agreement of the
Documentation Agent and the Banks in Article II herein to receive certain
notices by telephone and facsimile is solely for the convenience and at the
request of the Company. The Documentation Agent and the Banks shall be entitled
to rely in good faith on the authority of any Person purporting to be a Person
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authorized by the Company to give such notice and the Documentation Agent and
the Banks shall not have any liability to the Company or other Person on
account of any action taken or not taken by the Documentation Agent and the
Banks in good faith reliance upon such telephonic or facsimile notice. The
obligation of the Company to repay the Loans or any other Obligations shall not
be affected in any way or to any extent by any failure by the Documentation
Agent and the Banks to receive written confirmation of any telephonic or
facsimile notice or the receipt by the Documentation Agent and the Banks of a
confirmation which is at variance with the terms conveyed to the Documentation
Agent and the Banks in the telephonic or facsimile notice.
10.03 No Waiver. No failure to exercise and no delay in exercising, on
the part of the Documentation Agent or any Bank, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.
10.04 Costs and Expenses. The Company shall, whether or not the
transactions contemplated hereby shall be consummated:
(a) pay or reimburse the Documentation Agent on demand for all
costs and expenses incurred by the Documentation Agent in connection
with the development, preparation, delivery, administration and
execution of, and any amendment, supplement, waiver or modification to,
this Agreement, any Loan Document and any other documents prepared in
connection herewith or therewith, and the consummation of the
transactions contemplated hereby and thereby, including the Attorney
Cost incurred by it with respect thereto; provided, that the fees and
expenses of outside counsel in connection with the preparation of this
Agreement and the other Loan Documents shall be in accordance with a
letter agreement dated August 30, 1994 from Winston & Xxxxxx to the
Documentation Agent;
(b) pay or reimburse each Bank and the Documentation Agent on
demand for all reasonable costs and expenses incurred by them in
connection with the enforcement, attempted enforcement, or preservation
of any rights or remedies (including the connection with any "workout"
or restructuring regarding the Loans or any Event of Default or
Potential Default) under this Agreement, any other Loan Document, and
any such other documents, including Attorney Costs incurred by the
Documentation Agent and any Bank; and
(c) pay or reimburse the Documentation Agent on demand for all
reasonable appraisal (including the allocated cost of internal
appraisal services), audit, environmental inspection
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and review (including the allocated cost of such internal
services), search and filing costs, fees and expenses, incurred or
sustained by the Documentation Agent in connection with the matters
referred to under clause (b) of this Section 10.04.
10.05 Indemnity. The Company agrees to indemnify and hold harmless the
Banks, the Documentation Agent, the Arrangers and each director, officer and
employee of each of them (each, an "Indemnified Person") from and against any
and all action, suits, proceedings, damages, liabilities or expenses of any
kind or nature whatsoever which may be incurred by or asserted against any such
Indemnified Person: (a) as a result of the Company's making any untrue
statement of a material fact or omitting to state a material fact under or
pursuant to the Contract Documents, or the Company's negligence under, or
breach or default of, the Contract Documents; or (b) by any third party who has
a relationship with the Company and asserts in connection therewith that an
Indemnified Person is liable to such third party by reason of the Contract
Documents between the Company and the Banks, the Documentation Agent and/or the
Arrangers; provided, that no Indemnified Person shall be indemnified with
respect to such party's breach, default, negligence or bad faith in performning
its duties and obligations under any of the Contract Documents. For purposes
hereof, the term "Contract Documents" means the Loan Documents and any
further agreements or instruments entered into pursuant to this Agreement. Any
Indemnified Person seeking indemnification pursuant hereto with respect to a
third party claim must give the Company timely notice of any such claim and
cooperate in the defense thereof, and the Company shall have the right to
control the defense thereof and, if the same shall not involve any payment
or performance by the Indemnified Person, settlement of such claim.
10.06 Marshalling; Payments Set Aside. Neither the Documentation Agent
nor any Bank shall be under any obligation to xxxxxxxx any assets in favor of
the Company or any other person or against or in payment of any or all of the
Obligations. To the extent that the Company makes a payment or payments to the
Documentation Agent or the Banks, or the Documentation Agent or the Banks
enforce their Liens or exercise their rights of set-off, and such payment or
payments or the proceeds of such enforcement or set-off or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party in
connection with any Insolvency Proceeding, or otherwise, then to the extent of
such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or set-off had not occurred.
10.07 Successors and Assigns. Subject to Section 10.08 hereof, the
provisions of this Agreement shall be binding upon and
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inure to the benefit of the parties hereto and their respective successors and
assigns, except that the Company may not assign or transfer any of its rights
or obligations under this Agreement without the prior written consent of the
Documentation Agent and each Bank.
10.08 Assignments, Participations, Etc.
(a) Any Bank may, with the written consent of the Company and the
Documentation Agent, which consents shall not be unreasonably withheld, at any
time assign and delegate to one or more Eligible Assignees (provided that no
written consent of the Company or the Documentation Agent shall be required in
connection with any assignment and delegation by a Bank to a Bank Affiliate of
such Bank or to any other Bank) (each an "Assignee") all, or any part of all,
of its Loans, its Commitment Percentage of all LC Obligations, its Commitment
and the other rights and obligations of such Bank hereunder, in a minimum
amount (except with respect to assignments to other Banks) of Ten Million
Dollars ($10,000,000)); provided, however, that the Company and the
Documentation Agent may continue to deal solely and directly with such Bank in
connection with the interest so assigned to an Assignee until (A) written
notice of such assignment in form and substance satisfactory to the Company and
the Documentation Agent, together with payment instructions, addresses and
related information with respect to the Assignee, shall have been given to the
Company and the Documentation Agent by such Bank and the Assignee; (B) such
Bank and its Assignee shall have delivered to the Company and the Documentation
Agent an Assignment and Acceptance in the form of Exhibit I ("Assignment and
Acceptance"); (C) such Bank or its Assignee shall have paid the processing fee
of $3,000 to the Documentation Agent; and (D) the assigning Bank shall have
delivered any Committed Loan Note and any Competitive Bid Note payable to such
Bank to the Documentation Agent.
(b) From and after the date that the Documentation Agent notifies the
assignor Bank that the Requirements of Section 10.08(a) are satisfied (i) the
Assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, shall have the rights and obligations of a Bank under the Loan
Documents, and (ii) the assignor Bank shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its additional
obligations under the Loan Documents.
(c) Within five (5) Business Days after its receipt of notice by the
Documentation Agent that the requirements of Section 10.08(a) are satisfied the
Company shall execute and deliver to the Documentation Agent a Competitive Bid
Note payable to the order of the Assignee; provided, that unless the Assignor
Bank has retained
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a portion of its Commitment, the new Competitive Bid Note will only be
delivered upon receipt of the assignor Bank's Competitive Bid Note.
(d) Immediately upon each Assignee's making its payment under the
Assignment and Acceptance, this Agreement shall be deemed to be amended to the
extent, but only to the extent, necessary to reflect the addition of the
Assignee and the resulting adjustment of the Commitments arising therefrom. The
Commitment allocated to each Assignee shall reduce the Commitment of the
assigning Bank pro tanto.
(e) Any Bank may at any time sell to one or more commercial banks and,
in respect of Competitive Bid Loans, to any other Person (a "Participant")
participating interests in any Loans, LC Obligations, the Commitment of that
Bank and the other interests of that Bank (the "Originating Bank") hereunder
and under the other Loan Documents; provided, however, that (i) the Originating
Bank's obligations under this Agreement shall remain unchanged, (ii) the
Originating Bank shall remain solely responsible for the performance of such
obligations, (iii) the Company and the Documentation Agent shall continue to
deal solely and directly with the Originating Bank in connection with the
Originating Bank's rights and obligations under this Agreement and the other
Loan Documents, and (iv) no Bank shall transfer or grant any participating
interest under which the Participant shall have rights to approve any amendment
to, or any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment, consent or waiver would require
unanimous consent as described in the first proviso to Section 10.01. In the
case of any such participation, the Participant shall be entitled to the
benefits of Sections 3.01, 3.03 and 3.05 but only to the extent it would be
entitled to the same if it were also a Bank which is an Eligible Assignee, but
shall not have any other rights under this Agreement, or any of the other Loan
Documents, and all amounts payable by the Company hereunder shall be determined
as if such Bank had not sold such participation; except that, if amounts
outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an Event
of Default, each Participant shall be deemed to have the right of set-off in
respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing
directly to it as a Bank under this Agreement.
(f) Each Bank and the Documentation Agent agrees to take normal and
reasonable precautions and exercise due care to maintain the confidentiality of
all information identified as "confidential" by the Company provided to it by
the Company or by the Documentation Agent on the Company's behalf, in
connection with this Agreement or any other Loan Document, and neither it nor
any of its Affiliates shall use or disclose any such information for
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any purpose or in any manner other than pursuant to the terms contemplated by
this Agreement, except to the extent such information (i) was or becomes
generally available to the public other than as a result of a disclosure by a
party to this Agreement, or (ii) was or becomes available on a non-confidential
basis from a source other than the Company, provided that such source is not
bound by a confidentiality agreement with the Company known to the Bank;
provided, however, that the Documentation Agent or any Bank may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Documentation Agent or such Bank is subject
or in connection with an examination of the Documentation Agent or such Bank by
any such authority; (B) pursuant to subpoena or other court process; (C) when
required to do so in accordance with the provisions of any applicable
Requirement of Law; and (D) to the Documentation Agent's or such Bank's
independent auditors and other professional advisors in the ordinary course of
and within the scope of such advisors' engagements. Notwithstanding the
foregoing, the Company authorizes each Bank to disclose to any Participant or
Assignee (each, a "Transferee") and to any prospective Transferee, such
financial and other information in such Bank's possession concerning the
Company or its Subsidiaries which has been delivered to the Documentation Agent
or the Banks pursuant to this Agreement or which has been delivered to the
Documentation Agent or the Banks by the Company in connection with the Banks'
credit evaluation of the Company prior to entering into this Agreement;
provided, that unless otherwise agreed by the Company, such Transferee or
prosepctive Transferee agrees in writing to such Bank to keep such information
confidential to the same extent required of the Banks hereunder. Each Bank
agrees that its obligations under this Section 10.08 shall survive any sale or
assignment of its interests to a Transferee.
(g) Notwithstanding any other provision contained in this Agreement or
any other Loan Document to the contrary, any Bank may assign all or any portion
of the Loans held by it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Federal Reserve
Board and any Operating Circular issued by such Federal Reserve Bank, provided
that any payment in respect of such assigned Loans or Notes made by the Company
to or for the account of the assigning Bank in acordance with the terms of this
Agreement shall satisfy the Company's obligations hereunder in respect to such
assigned Loans or Notes to the extent of such payment. No such assignment shall
release the assigning Bank from its obligations hereunder. Each Bank agrees to
give the Company prompt written notice prior to any disclosure or release of
any confidential material pursuant to the first proviso of Section 10.08(f).
10.09 Set-off. In addition to any rights and remedies of the Banks
provided by law, if the Obligations shall have become due and payable in full,
each Bank is authorized at any time and from time
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to time, without prior notice to the Company, any such notice being waived by
the Company to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held by, and other indebtedness at any time owing to, such Bank to or
for the credit or the account of the Company against any and all obligations
owing to such Bank, now or hereafter existing, irrespective of whether or not
the Documentation Agent or such Bank shall have made demand under this
Agreement or any Loan Document. Each Bank agrees promptly to notify the Company
and the Documentation Agent after any such set-off and application made by such
Bank; provided, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Bank under this
Section 10.09 are in addition to the other rights and remedies (including other
rights of set-off) which such Bank may have.
10.10 Notification of Addresses, Lending Offices, Etc. Each Bank
shall notify the Documentation Agent and the Company in writing of any changes
in the address to which notices to the Bank should be directed, of the
addresses of any of its Lending Offices of payment instructions in respect of
all payments to be made to it hereunder and of such other administrative
information as the Documentation Agent or the Company shall reasonably request.
10.11 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement in any number of separate counterparts, each of
which, when so executed, shall be deemed an original, and all of said
counterparts taken together shall be deemed to constitute but one and the same
instrument. A set of the copies of this Agreement signed by all the parties
shall be lodged with the Company and the Documentation Agent.
10.12 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or any instrument or agreement required
hereunder.
10.13 No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the Banks and
the Documentation Agent and their permitted successors and assigns, and no
other Person shall be a direct or indirect legal beneficiary of, or have any
direct or indirect cause of action or claim in connection with, this Agreement
or any of the other Loan Documents. Neither the Documentation Agent nor any
Bank shall have any obligation to any Person not a party to this Agreement or
other Loan Documents.
10.14 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD
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TO CONFLICTS OF LAW PROVISIONS THEREOF); PROVIDED THAT THE COMPANY, THE
DOCUMENTATION AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE DOCUMENTATION AGENT
AND THE BANKS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE DOCUMENTATION AGENT AND
THE BANKS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE
COMPANY, THE DOCUMENTATION AGENT AND THE BANKS EACH WAIVE PERSONAL SERVICE OF
ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY NEW YORK LAW.
10.15 Waiver of Jury Trial. THE COMPANY, THE BANKS AND THE
DOCUMENTATION AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE BANKS AND THE
DOCUMENTATION AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY
OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR
THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
10.16 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement, and understanding among the Company,
the Banks and the Documentation Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof, except for the fee
letters referenced in Sections 2.11(b) and 2.11(c) and any prior arrangements
made with respect to the payment by the Company of (or any indemnification for)
any fees, costs or expenses payable to or incurred (or to be incurred) by or on
behalf of the Documentation Agent or the Banks.
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10.17 Termination of Existing Facilities. The Company and each Bank
party to this Agreement which is also party to an Existing Facility hereby
agree to terminate such Existing Facility effective upon the execution of this
Agreement. The Company hereby agrees to pay any fees outstanding to any such
Bank in connection with such Existing Facility as soon as practicable following
invoice thereof by such Bank.
[BALANCE OF PAGE LEFT INTENTIONALLY BLANK; SIGNATURE PAGES FOLLOW.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their proper and duly
authorized officers as of the day and year first above written.
KMART CORPORATION
By: Xxxxx X. Xxxxxxxx
-------------------------------
Title: Vice President and Treasurer
----------------------------
Address for Notices:
0000 Xxxx Xxx Xxxxxx Xxxx
Xxxx, XX 00000
Attn: Treasurer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Documentation Agent
By: _______________________________
Title: ____________________________
Address for Notices:
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Agency Management Services
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
KMART CORPORATION
By: __________________________
Title: _______________________
Address for Notices:
0000 Xxxx Xxx Xxxxxx Xxxx
Xxxx, XX 00000
Attn: Treasurer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as
Documentation Agent
By: Xxxxxxx Xxxxxx
---------------------------
Title: Vice President
------------------------
Address for Notices:
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Agency Management Services
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
82
Banks Signatory to Credit Agreement
Banca Commerciale Italiana, Chicago Branch
Banca Nazionale del Lavoro S.p.A. - New York Branch
Bankers Trust Company
Bank of America National Trust and Savings Association
The Bank of California, N.A.
Bank of Hawaii
The Bank of New York
The Bank of Tokyo Trust Company
Xxxxxxx Bank of South Florida, X.X.
Xxxxxx Nationale de Credit Agricole
Canadian Imperial Bank of Commerce
Comerica Bank
Credit Lyonnais Chicago Branch
Credit Lyonnais Cayman Island Branch
The Dai-Ichi Kangyo Bank, Ltd., Chicago Branch
The Daiwa Bank, Limited
Deutsche Bank AG, Chicago and/or Cayman Islands Branches
00
Xxxxx Xxxxxxxxxx Xxxx xx Xxxxxxxxxx
The First National Bank of Boston
The First National Bank of Chicago
First Tennessee Bank National Association
Fleet Bank of Massachusetts, N.A.
The Fuji Bank, Limited
Istitutio Bancario San Paolo di Torino S.p.A.
The Long-Term Credit Bank of Japan, Ltd. Chicago Branch
Michigan National Bank
The Mitsubishi Trust and Banking Corp.
National City Bank, Columbus
Nationsbank of North Carolina, N.A.
NBD Bank, N.A.
Royal Bank of Canada
The Sakura Bank, Limited
The Sanwa Bank, Limited, Chicago Branch
Shawmut Bank, N.A.
Societe Generale
Society National Bank
84
The Sumitomo Bank, Limited, Chicago Branch
The Tokai Bank, Ltd., Chicago Branch
UMB Bank, n.a.
Union Bank
Union Bank of Switzerland - Chicago Branch
United States National Bank of Oregon
Westdeutsche Landesbank Girozentrale New York and Cayman Islands Branches
Yasuda Trust and Banking Company, Limited
85
SCHEDULE 5.03
CONSENTS AND APPROVALS
None.
86
SCHEDULE 7.03
EXISTING MORTGAGES, SECURITY INTEREST AND LIENS ON ASSETS OF THE COMPANY
EXISTING ON THE CLOSING DATE
Liens/Security Interests/Mortgages on PACE properties
Current Mortgages existing on Kmart Corporation's properties as of September
21, 1994 was $336 million
Kmart Corporation has guaranteed indebtedness related to certain of its
properties financed by industrial revenue bonds. At January 26, 1994, the total
amount of such guaranteed indebtedness was $284 million, of which $92 million
was included in capital lease obligations.
87
EXHIBIT A
FORM OF NOTICE OF BORROWING
___________________, 19___
Bank of America National Trust
and Savings Association, as
Documentation Agent
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Agency Management Services
Re: Three Year Credit Agreement dated as of October 7, 1994 (as from
time to time amended, restated, supplemented or otherwise
modified, the "Credit Agreement") among KMART CORPORATION (the
"Company"), the Banks named therein and BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Documentation Agent
Ladies and Gentlemen:
The undersigned refers to the Credit Agreement, the terms defined
therein being used herein as therein defined, and hereby gives you notice
irrevocably, pursuant to Section 2.03 of the Credit Agreement, of the Committed
Borrowing specified herein:
(1) The Business Day of the proposed Borrowing is ________________
____________________, 19___.
(2) The aggregate amount of the proposed Borrowing is
$_______________.
(3) The proposed Borrowing is to be comprised of [LIBOR] [CD Rate]
[Reference Rate] Committed Loans.
[(4) The duration of the initial Interest Period for the [LIBOR
Committed Loans] [CD Rate Committed Loans] included in the proposed
Borrowing shall be ______________________ [months] [days].]
(5) Payment for this Borrowing is to be made to account number _____ at
the Documentation Agent.
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the proposed Borrowing,
before and after giving effect thereto and to the application of the proceeds
therefrom:
88
(a) the representations and warranties of the undersigned contained in
Article V of the Credit Agreement are true and correct on and as of each such
date as if made on and as of each such date (except to the extent such
representations and warranties expressly refer to an earlier date, in which
case they shall be true and correct as of such earlier date); and
(b) no Potential Default or Event of Default exists or shall result
from such proposed Borrowing.
KMART CORPORATION
By: _____________________________
Title: __________________________
X-0
00
XXXXXXX X
FORM OF NOTICE OF CONVERSION/CONTINUATION
__________, 19__
Bank of America National Trust
and Savings Association, as
Documentation Agent
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Agency Management Services
Re: Three Year Credit Agreement dated as of October 7, 1994
(as from time to time amended, restated, supplemented or otherwise
modified, the "Credit Agreement") among KMART CORPORATION (the
"Company"), the Banks named therein and BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Documentation Agent
Ladies and Gentlemen:
The undersigned refers to the Credit Agreement, the terms defined
therein being used herein as therein defined, and hereby gives you notice
irrevocably, pursuant to Section 2.04 of the Credit Agreement, of the
[conversion] [continuation] of the Committed Loans specified herein:
(1) The [Conversion Date] [Continuation Date] is ________, 19__.
(2) The aggregate amount of the Committed Loans to be [converted]
[continued] is $___________________.
(3) The Loans are to be [converted into] [continued as] [LIBOR] [CD
Rate] [Reference Rate] Committed Loans.
(4) Unless the Loans are to be converted into Reference Rate
Committed Loans, the duration of the Interest Period for
the Loans included in the [conversion] [continuation] shall be
____________ [months] [days].
The undersigned hereby certifies that no Potential Default or Event
of Default exists as of the date hereof.
KMART CORPORATION
By: ______________________
Title: ___________________
90
EXHIBIT C
FORM OF COMMITTED LOAN NOTE
$_____________ __________________, 19___
FOR VALUE RECEIVED, the undersigned, KMART CORPORATION, a Michigan
corporation (the "Company"), hereby promises to pay to the order of
_____________________________ (the "Bank") the principal sum of ______________
Dollars ($_________) or, if less, the aggregate unpaid principal amount of the
Committed Loans made by the Bank to the Company pursuant to the Three Year
Credit Agreement dated as of October 7, 1994 (as from time to time amended,
restated, supplemented or otherwise modified, the "Credit Agreement"), among
the Company, the Bank, the other banks parties thereto and BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION, as Documentation Agent, on the
Termination Date.
The Company also promises to pay interest on the unpaid principal
amount hereof from the date hereof until paid at the rates and at the times
which shall be determined in accordance with the provisions of the Credit
Agreement.
This promissory note (this "Note") is one of the Company's Committed
Loan Notes issued pursuant to and entitled to the benefits of the Credit
Agreement to which reference is hereby made (including Section 2.02 thereof)
for a more complete statement of the terms and conditions under which the
Committed Loans evidenced hereby are made and are to be repaid and the amounts
owing hereunder. Capitalized terms used herein without definition shall have
the meanings set forth in the Credit Agreement.
All payments of principal and interest in respect of this Note shall be
made in lawful money of the United States of America in immediately available
funds at the office of the Administrative Agent at San Francisco, California or
at such other place as shall be designated in writing for such purpose in
accordance with the terms of the Credit Agreement. Each of the Bank and any
subsequent holder of this Note agrees that before disposing of this Note or any
part hereof it will make a notation hereon of all principal payments previously
made hereunder and of the date to which interest hereon has been paid;
provided, that the failure to make a notation of any payment made on this Note
shall not limit or otherwise affect the obligation of the Company hereunder
with respect to payments of principal or interest on this Note.
This Note is subject to prepayment as provided in the Credit Agreement.
Upon the occurrence of an Event of Default, the unpaid balance of the principal
amount of this Note may become, or may be declared to be, due and payable in
the manner, upon the conditions and with the effect provided in the Credit
Agreement.
The Company promises to pay all actual and reasonable costs and
expenses, including Attorney Costs, incurred in the collection
91
and enforcement of this Note. The Company and endorsers of this Note hereby
consent to renewals and extensions of time at or after the maturity hereof,
without notice, and hereby waive diligence, presentment, protest, demand and
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defense to any demand hereunder.
THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS
OF LAW PROVISIONS THEREOF).
IN WITNESS WHEREOF, the Company has caused this Note to be executed and
delivered by its duly authorized officer, as of the day and year first above
written.
KMART CORPORATION
By:__________________________________
Title:_______________________________
C-2
92
TRANSACTIONS ON COMMITTED LOAN NOTE
(REFERENCE RATE)
AMOUNT
INTEREST AMOUNT OF PRINCIPAL OR OUTSTANDING
RATE LOAN MADE PAID BALANCE PRINCIPAL NOTATION
DATE ON LOAN THIS DATE THIS DATE THIS DATE MADE BY
-------------------------------------------------------------------------------------------------------------------------------
C-3
93
TRANSACTIONS ON COMMITTED LOAN NOTE
(LIBOR)
AMOUNT
APPLICABLE AMOUNT OF PRINCIPAL OR OUTSTANDING
MARGIN LOAN MADE INTEREST PAID BALANCE PRINCIPAL NOTATION
DATE LIBOR THIS DATE PERIOD THIS DATE THIS DATE MADE BY
-------------------------------------------------------------------------------------------------------------------------------
C-4
94
TRANSACTIONS ON COMMITTED LOAN NOTE
(CD RATE)
AMOUNT
APPLICABLE AMOUNT OF PRINCIPAL OR OUTSTANDING
MARGIN LOAN MADE INTEREST PAID BALANCE PRINCIPAL NOTATION
DATE CD RATE THIS DATE PERIOD THIS DATE THIS DATE MADE BY
-------------------------------------------------------------------------------------------------------------------------------
C-5
95
EXHIBIT D
FORM OF COMPETITIVE BID NOTE
______________, 19___
FOR VALUE RECEIVED, the undersigned, KMART CORPORATION, a Michigan
corporation (the "Company"), hereby promises to pay to the order of
_________________________________________________________________ (the "Bank")
the principal sum of each Competitive Bid Loan ("Bid Loan") made by the Bank to
the Company pursuant to the Three Year Credit Agreement dated as of October 7,
1994 (as from time to time amended, restated, supplemented or otherwise
modified, the "Credit Agreement"), among the Company, the Bank, the other banks
parties thereto and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as
Documentation Agent, on the last day of the Interest Period for such Bid Loan.
The Company also promises to pay interest on the unpaid principal
amount hereof from the date hereof until paid at the rates and at the times
which shall be determined in accordance with the provisions of the Credit
Agreement.
This promissory note (this "Note") is one of the Company's Competitive
Bid Notes issued pursuant to and entitled to the benefits of the Credit
Agreement to which reference is hereby made (including Section 2.02 thereof)
for a more complete statement of the terms and conditions under which the Bid
Loans evidenced hereby are made and are to be repaid and the amounts owing
hereunder. Capitalized terms used herein without definition shall have the
meanings set forth in the Credit Agreement.
All payments of principal and interest in respect of this Note shall be
made in lawful money of the United States of America in immediately available
funds at the office of the Documentation Agent at San Francisco, California or
at such other place as shall be designated in writing for such purpose in
accordance with the terms of the Credit Agreement. Each of the Bank and any
subsequent holder of this Note agrees that before disposing of this Note or any
part hereof it will make a notation hereon of all principal payments previously
made hereunder and of the date to which interest hereon has been paid;
provided, that the failure to make a notation of any payment made on this Note
shall not limit or otherwise affect the obligation of the Company hereunder
with respect to payments of principal or interest on this Note.
This Note is not subject to prepayment as provided in the Credit
Agreement. Upon the occurrence of an Event of Default, the unpaid balance of
the principal amount of this Note may become, or may be declared to be, due and
payable in the manner, upon the conditions and with the effect provided in the
Credit Agreement.
The Company promises to pay all actual and reasonable costs and
expenses, including Attorney Costs, incurred in the collection
96
and enforcement of this Note. The Company and endorsers of this Note hereby
consent to renewals and extensions of time at or after the maturity hereof,
without notice, and hereby waive diligence, presentment, protest, demand and
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defense to any demand hereunder.
THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS
OF LAW PROVISIONS THEREOF).
IN WITNESS WHEREOF, the Company has caused this Note to be executed and
delivered by its duly authorized officer, as of the day and year first above
written.
KMART CORPORATION
By: _____________________________
Title: __________________________
D-2
97
TRANSACTIONS ON COMPETITIVE BID NOTE
(ABSOLUTE RATE)
AMOUNT
INTEREST AMOUNT OF END OF PRINCIPAL OR OUTSTANDING
RATE LOAN MADE INTEREST PAID BALANCE PRINCIPAL NOTATION
DATE ON LOAN THIS DATE PERIOD THIS DATE THIS DATE MADE BY
_______________________________________________________________________________
D-3
98
TRANSACTIONS ON COMPETITIVE BID NOTE
(LIBOR)
AMOUNT
APPLICABLE AMOUNT OF PRINCIPAL OR OUTSTANDING
MARGIN LOAN MADE INTEREST PAID BALANCE PRINCIPAL NOTATION
DATE LIBOR BID THIS DATE PERIOD THIS DATE THIS DATE MADE BY
________________________________________________________________________________
D-4
99
EXHIBIT E
FORM OF COMPETITIVE BID REQUEST
____________________, 19___
Bank of America National Trust
and Savings Association, as
Documentation Agent
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Agency Management Services
Fax No.: (000) 000-0000
Reference is made to the Three Year Credit Agreement dated as of
October 7, 1994 (as from time to time amended, restated, supplemented or
otherwise modified, the "Credit Agreement"; capitalized terms used herein shall
have the meanings assigned to them in the Credit Agreement) among KMART
CORPORATION (the "Company"), the Banks party thereto and BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION, as Documentation Agent.
This is a Competitive Bid Request for [Absolute Rate] [LIBOR] Bid Loans
pursuant to Section 2.06 of the Credit Agreement as follows:
Aggregate Principal Amount: $__________ $__________ $__________
Date of Advance: __________ __________ __________
Maturity Date: __________ __________ __________
Interest Period: __________ __________ __________
Interest Payment Dates: __________ __________ __________
[other relevant information] __________ __________ __________
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the proposed Borrowing,
before and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of the undersigned contained in
Article V of the Credit Agreement are true and correct on and as of each such
date as if made on and as of each such date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they shall be true and correct as of such earlier date); and
100
(b) no Potential Default or Event of Default exists or shall result
from such proposed Borrowing.
Very truly yours,
KMART CORPORATION
By: ________________________
Title: _____________________
X-0
000
XXXXXXX X
FORM OF INVITATION FOR COMPETITIVE BIDS
___________________, 19__
TO: [Name of Bank]
FROM: Bank of America National Trust and Savings Association, as
Documentation Agent
RE: Three Year Credit Agreement dated as of October 7, 1994 (as from time
to time amended, restated, supplemented or otherwise modified, the
"Credit Agreement" among KMART CORPORATION (the "Company"), the Banks
party thereto and Bank of America National Trust and Savings
Association, as Documentation Agent. Capitalized terms used herein but
not defined herein have the meanings assigned to them in the Credit
Agreement.
Pursuant to Section 2.06(b) of the Credit Agreement, we have received
from the Company a Competitive Bid Request inviting you to submit Competitive
Bids to the Company for the following proposed [Absolute Rate Bid Loan(s)]
[LIBOR Bid Loan(s)]:
Date of proposed Competitive Bid Borrowing: ____________________________, 19__
Aggregate
Principal Amount
Interest Period(s) of Loans Rate
------------------ ---------------- ----
Your Competitive Bid must comply with Section 2.06(c) of the Credit
Agreement and the foregoing terms on which the Competitive Bid Request was
made.
Please respond to this invitation by no later than ______ a.m. (New
York City time) _________________, 19__ to us at __________________________;
facsimile number ___________________________; telex number __________________.
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Documentation Agent
By: ___________________________
Title: _______________________
_
102
EXHIBIT G
FORM OF COMPETITIVE BID
Bank of America National Trust
and Savings Association, as
Documentation Agent
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Agency Management Services
Dear Sirs:
Reference is made to the Three Year Credit Agreement dated as of
October 7, 1994 (as from time to time amended, restated, supplemented or
otherwise modified, the "Credit Agreement"; capitalized terms used herein shall
have the meanings assigned to them in the Credit Agreement) among KMART
CORPORATION (the "Company"), the Banks party thereto and BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION, as Documentation Agent.
In response to the Invitation for Competitive Bids dated ____________
__, 19__ and in accordance with Section 2.06(c) of the Credit Agreement, the
undersigned Bank offers to make [Absolute Rate Bid Loan(s)] [LIBOR Bid Loan(s)]
thereunder in the following principal amount(s) at the following interest
rate(s) for the following Interest Period(s):
Date of Borrowing: ____________ __, 19__
OFFER 1: (MAXIMUM AMOUNT $__________)
(MINIMUM AMOUNT $__________).
INTEREST PRINCIPAL [LIBOR Bid Margin]
PERIOD AMOUNT [Absolute Rate]
-------- --------- ------------------
-------------- -------------- --------------
-------------- -------------- --------------
-------------- -------------- --------------
-------------- -------------- --------------
OFFER 2: (MAXIMUM AMOUNT $__________)
(MINIMUM AMOUNT $__________).
INTEREST PRINCIPAL [LIBOR Bid Margin]
PERIOD AMOUNT [Absolute Rate]
-------- --------- ------------------
-------------- -------------- --------------
-------------- -------------- --------------
-------------- -------------- --------------
-------------- -------------- --------------
103
OFFER 3: (MAXIMUM AMOUNT $__________)
(MINIMUM AMOUNT $__________).
INTEREST PRINCIPAL [LIBOR Bid Margin]
PERIOD AMOUNT [Absolute Rate]
_______________ _______________ __________________
_______________ _______________ _______________
_______________ _______________ _______________
_______________ _______________ _______________
_______________ _______________ _______________
Subject to Section 2.06(e) of the Credit Agreement, the Company may not
later than 10:30 a.m. (New York City time) three Business Days prior to the
proposed date of Borrowing, in the case of a LIBOR Auction, or 10:30 a.m. (New
York City time) on the proposed date of Borrowing, in the case of an Absolute
Rate Auction, accept any combination of Interest Periods from one or more
offers for the principal amounts indicated; provided, that the aggregate
principal amount accepted from one offer does not exceed the maximum amount
specified for such offer and the aggregate principal amount of all [Absolute
Rate Bid Loans] [LIBOR Bid Loans] accepted does not exceed $_______________.
[NAME OF BIDDING BANK]
By:_________________________________
Name:___________________________
Title: _____________________________
Telephone No.:______________________
Telecopier No.:_____________________
G-2
104
EXHIBIT H-1
(Letterhead of A.N. Xxxxxxx, Esq.)
October 7, 0000
Xxxx xx Xxxxxxx National Trust
and Savings Association,
individually and as Documentation Agent
under the Three Year Credit Agreement referred
to below (the "Documentation Agent")
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
and
The Financial Institutions
listed on Schedule I hereto
Ladies and Gentlemen:
I am General Counsel to Kmart Corporation, a Michigan corporation
("Kmart"). In my capacity as General Counsel, I am authorized to furnish
opinions on behalf of Kmart that may be required in connection with various
matters, including that certain Three Year Credit Agreement dated as of October
7, 1994 (the "Credit Agreement") among Kmart, the financial institutions
signatory thereto (the "Banks") and Bank of America National Trust and Savings
Association, as Documentation Agent ("Documentation Agent").
The Credit Agreement and the Committed Loan Notes dated as of October
7, 1994 payable to the Banks executed and delivered by Kmart thereunder (the
"Notes") are hereinafter collectively referred to as the "Transaction
Documents." Capitalized terms appearing herein but not otherwise defined herein
shall have the meanings ascribed thereto in the Credit Agreement.
In rendering the opinions set forth herein, I have examined originals
of the Transaction Documents executed by Kmart and originals or copies,
certified to my satisfaction, of such (i) certificates of public officials;
(ii) certificates of officers and representatives of Kmart; and (iii) other
documents, records and papers, and I have made such inquiries of officers and
representatives of Kmart as I have deemed relevant or necessary as the basis
for such opinions. I have relied upon, and assume the accuracy of, such
certificates and other statements, documents, records, and papers with respect
to the factual matters set forth therein and I have assumed the genuineness of
all of the signatures
105
(other than the signatures of Kmart) and the authenticity of all documents
submitted to me as originals and the conformity to original documents of all
documents submitted to me as certified or photostatic copies.
Based on the foregoing and subject to the qualifications stated herein,
I am of the opinion that:
1. Kmart (i) is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization; (ii) is duly
authorized to do business in each jurisdiction in which it owns or leases
property and where the failure to do so would have a material adverse effect on
its condition (financial or otherwise), properties, business, assets or results
of operations; and (iii) has all requisite corporate power and authority to
enter into and perform its obligations under the Transaction Documents to which
it is a party and under any Competitive Bid Notes which it may issue from time
to time.
2. The execution, delivery and performance by Kmart of each Transaction
Document and of any Competitive Bid Notes which it may issue from time to time
hereafter, and the consummation of each of the transactions and performance of
each of the obligations on its part contemplated thereby;
(i) have been duly authorized by all necessary corporate
proceedings;
(ii) are not in contravention of its articles of incorporation,
bylaws or other organizational documents;
(iii) will not violate any provisions of any law, rule,
regulation (including any order, writ, judgment, decree, determination
or award of any court or governmental instrumentality) presently in
effect having applicability to it;
(iv) will not conflict with or result in a breach of or
constitute a default under or tortious interference with any indenture
or loan or credit agreement, or any other agreement or instrument of
which I have knowledge, to which it is a party or by which it or any of
its properties may be bound (which conflict, breach, default or
tortious interference would have a material adverse effect on its
condition (financial or otherwise), properties, business, assets or
results of operations);
(v) will not result in or require the creation or imposition of
any Lien of any nature upon or with respect to any of the properties
now owned or hereafter acquired by it; and
(vi) except as already applied for or received as of the date
hereof, do not require any authorization, consent, certificate,
inspection, franchise, approval, license,
H/1-2
106
qualification or formal exemption from, or any filing, declaration or
registration with, any court, governmental agency or regulatory authority or
any other Person.
3. Kmart has duly executed and delivered the Transaction Documents, and
each Transaction Document constitutes and each Competitive Bid Note when issued
will constitute the valid and binding obligation, enforceable against it in
accordance with the terms of such Transaction Document or Competitive Bid Note.
4. There are no actions, suits, proceedings, investigations or
judgments before any court, governmental agency or regulatory authority
(foreign, Federal, state or local) outstanding, pending, or, to the best of my
knowledge and belief, threatened against or in any other way involving or
affecting Kmart or its properties, which, if determined adversely to it (i)
would enjoin or otherwise materially interfere with the completion of any of
the transactions contemplated by the Transaction Documents or any Competitive
Bid Note, or (ii) would materially impair its ability to perform its obligations
under the Transaction Documents or any Competitive Bid Note.
5. To the best of my knowledge after due inquiry, Kmart is not in
default with respect to any order of any court, arbitrator or governmental body
where such default would have a material adverse effect on its condition
(financial or otherwise), properties, business, assets or results of
operations, and it is not subject to or party to any order of any court or
governmental authority arising out of any action, suit or proceeding against it
under any statute or other law respecting antitrust, monopoly, restraint of
trade, unfair competition or similar matters the effect of which could be
reasonably expected to have a material adverse effect on its condition
(financial or otherwise), properties, business, assets or results of
operations.
6. To the best of my knowledge after due inquiry, Kmart is not in
violation of any statute, rule or regulation of any governmental authority
where such violation would have a material adverse effect on its condition
(financial or otherwise), properties, business, assets or results of operations.
7. To the best of my knowledge after due inquiry, there is no existing
material default by Kmart under any written contract, lease agreement, or other
material agreement to which it is a party or by which any of its assets is
bound which has, or could be reasonably expected to have, a material adverse
effect upon its condition (financial or otherwise), properties, business,
assets or results of operations.
8. Kmart is not an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, nor is it
controlled by such a company.
H/1-3
107
9. Kmart is not a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
The opinions herein expressed are subject to the following limitations
and qualifications:
(a) The enforceability of the rights and remedies of the Documentation
Agent and the Banks under each of the Transaction Documents and any Competitive
Bid Notes is subject to the effect of any applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws of
general application affecting creditors' rights generally.
(b) Enforceability of each of the Transaction Documents and any
Competitive Bid Notes is subject to general principles of equity (regardless of
whether such enforceability is considered in proceeding in equity or at law),
including requirements of reasonableness and good faith in the exercise of
rights and remedies under any loan documents, and no opinion is expressed as to
any specific remedy that may be granted, imposed or rendered, including
equitable remedies such as those of specific performance, receivership and
injunction.
(c) The enforceability of particular rights and remedies provided in
the Transaction Documents and any Competitive Bid Notes may be limited by
applicable laws, provided, however, that sufficient rights and remedies are
available to afford the Documentation Agent and the Banks the practical
realization of the benefits afforded by the Transaction Documents and such
Competitive Bid Notes.
Without limitation of the foregoing, I express no opinion: (i) as to
any provisions for acceleration of indebtedness or imposition of penalties in
the event of, or remedies available for, breaches of the Transaction Documents
which might be determined by a court to be non-material (including material
breaches of non-material provisions), or where the enforcement of such
provisions or remedies might be found not to have been taken in good faith and
in a reasonable manner; (ii) as to remedies available in respect of breaches of
the Transaction Documents or provisions for indemnification against liabilities
or losses thereunder which breaches, liabilities or losses might be found to be
the proximate result of actions or omissions by the Documentation Agent or the
Banks; (iii) as to any provision of the Transaction Documents to the extent
such provisions would constitute waivers of rights that may be found to
constitute waivers that are against public policy; (iv) as to any provision of
the Transaction Documents to the extent that it purports to waive the
requirements of good faith, notice and commercial reasonableness under the
U.C.C. which requirements cannot be waived
H/1-4
108
by consent; (v) as to provisions in the Transaction Documents which provide for
the imposition of penalties, the payment or reimbursement of costs and expenses
or the indemnification of claims, losses or liabilities that may be found to be
unrelated to the damage suffered by the Documentation Agent or the Banks or in
excess of a reasonable amount; (vi) as to any provisions of the Transaction
Documents which constitute rights that may be found to be against public
policy; (vii) as to the validity of any provision of any Transaction Document
which provides for the compounding of interest or payment or accrual of
interest on interest; and (viii) as to provisions in the Transaction Documents
which waive objection to jurisdiction, the manner of service of process, notice
or the effects of delay or failure to exercise rights and remedies.
(d) I am qualified to practice law in the State of Michigan and I do
not purport to express any opinion herein concerning any laws other than the
laws of the State of Michigan and applicable federal law.
(e) This opinion is predicated solely upon laws and regulations in
existence as of the present date and as they presently apply, and to the facts
as they presently exist. I assume no obligation to revise or supplement this
opinion should the present laws be changed by legislative action, judicial
decision or otherwise.
Whenever in this opinion I have used the phrase "to the best of our
knowledge" (or similar terms), this means the conscious awareness of those
attorneys in my department who have active involvement in the preparation of
this opinion or who are primarily responsible for providing the response
concerning a particular opinion issue or information regarding factual matters.
This opinion is rendered to you solely for your benefit in connection
with the above transactions and may not be relied upon by you for any other
purpose or by any other persons without my prior written consent. This opinion
is limited to the matters set forth herein and no opinion is intended to be
implied or inferred beyond those expressly stated herein.
Very truly yours,
H/1-5
109
Schedule I
Financial Institutions
[to come]
H/1-6
110
EXHIBIT H-2
{letterhead of Dickinson, Wright, Moon, Van Dusen & Xxxxxxx}
October 7, 0000
Xxxx xx Xxxxxxx National Trust
and Savings Association,
individually and as Documentation Agent
under the Three Year Credit Agreement referred
to below (the "Documentation Agent")
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
and
The Financial Institutions
listed on Schedule I hereto
Ladies and Gentlemen:
We have acted as special counsel to Kmart Corporation, a Michigan
corporation ("Kmart"), in connection with the following agreements and
documents and the transactions contemplated thereby:
(i) that certain Three Year Credit Agreement dated as of October 7,
1994 by and among Kmart, the financial institutions signatory thereto (the
"Banks") and the Documentation Agent (the "Credit Agreement"); and
(ii) those certain Committed Loan Notes dated as of October 7, 1994
payable to the Banks, executed and delivered by Kmart thereunder (the
"Notes").
The Credit Agreement and the Notes are hereinafter collectively
referred to as the "Transaction Documents." Capitalized terms appearing
herein but not otherwise defined herein shall have the meanings ascribed
thereto in the Credit Agreement. Pursuant to Section 4.01(d) of the Credit
Agreement, this opinion is delivered to you upon the instruction of Kmart.
In rendering the opinions set forth herein, we have examined originals
of the Transaction Documents executed by Kmart and originals or copies,
certified to our satisfaction, of such (i) certificates of public officials;
(ii) certificates of officers and representatives of Kmart; and (iii) other
documents, records and papers, and we have made such inquiries of officers and
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representatives of such entity, as we have deemed relevant or necessary as the
basis for such opinions. We have relied upon, and assume the accuracy of, such
certificates and other statements, documents, records and papers with respect
to the factual matters set forth therein and we have assumed the genuineness of
all of the signatures (other than the signatures of Kmart) and the authenticity
of all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as certified or photostatic copies.
We have further assumed that negotiations with respect to the transactions
contemplated by the Transaction Documents took place in the State of New York,
Loans under the Credit Agreement shall be disbursed by the Documentation Agent
out of its offices in New York and payments under the Credit Agreement shall be
made to the Documentation Agent at its offices in New York.
Based on the foregoing and subject to the qualifications stated herein,
we are of the opinion that:
1. Kmart has duly executed and delivered the Transaction Documents, and
each such Transaction Document constitutes and each Competitive Bid Note when
issued will constitute the valid and binding obligation of Kmart, enforceable
against it in accordance with the terms of such Transaction Document.
2. In any action or proceeding in the State of Michigan arising out of
or relating to any of the Transaction Documents or any Competitive Bid Note,
the provisions of the Transaction Documents or such Competitive Bid Note
wherein the parties thereto agree that the Transaction Documents or such
Competitive Bid Note shall be governed by, and be construed in accordance with,
the laws of the State of New York, would be recognized and given effect.
3. The rates of interest applicable to the obligations of Kmart under
the Credit Agreement do not violate any law, rule or regulation of the State of
Michigan prescribing a maximum rate of interest. We call to your attention,
however, that the Michigan criminal usury statute makes it unlawful to
knowingly charge, take or receive interest on a loan at a rate exceeding 25%
per annum.
The opinions herein expressed are subject to the following limitations
and qualifications:
(a) The enforceability of the rights and remedies of the Documentation
Agent and the Banks under each of the Transaction Documents and any Competitive
Bid Notes is subject to the effect of any applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws of
general application affecting creditors' rights generally.
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(b) Enforceability of each of the Transaction Documents and any
Competitive Bid Notes is subject to general principles of equity (regardless of
whether such enforceability is considered in proceeding in equity or at law),
including requirements of reasonableness and good faith in the exercise of
rights and remedies under any loan documents, and no opinion is expressed as
to any specific remedy that may be granted, imposed or rendered, including
equitable remedies such as those of specific performance, receivership and
injunction.
(c) The enforceability of particular rights and remedies provided in
the Transaction Documents and any Competitive Bid Notes may be limited by
applicable laws, provided, however, that sufficient rights and remedies are
available to afford the Documentation Agent and the Banks the practical
realization of the benefits afforded by the Transaction Documents and such
Competitive Bid Notes.
Without limitation of the foregoing, we express no opinion: (i) as to
any provisions for acceleration of indebtedness or imposition of penalties in
the event of, or remedies available for, breaches of the Transaction Documents
which might be determined by a court to be non-material (including material
breaches of non-material provisions), or where the enforcement of such
provisions or remedies might be found not to have been taken in good faith and
in a reasonable manner; (ii) as to remedies available in respect of breaches of
the Transaction Documents or provisions for indemnification against liabilities
or losses thereunder which breaches, liabilities or losses might be found to be
the proximate result of actions or omissions by the Documentation Agent or the
Banks; (iii) as to any provision of the Transaction Documents to the extent
such provisions would constitute waivers of rights that may be found to
constitute waivers that are against public policy; (iv) as to any provision of
the Transaction Documents to the extent that it purports to waive the
requirements of good faith, notice and commercial reasonableness under the
U.C.C. which requirements cannot be waived by consent; (v) as to provisions in
the Transaction Documents which provide for the imposition of penalties, the
payment or reimbursement of costs and expenses or the indemnification of
claims, losses or liabilities that may be found to be unrelated to the damage
suffered by the Documentation Agent or the Banks or in excess of a reasonable
amount; (vi) as to any provisions of the Transaction Documents which constitute
rights that may be found to be against public policy; (vii) as to the validity
of any provision of any Transaction Document which provides for the compounding
of interest or payment or accrual of interest on interest; and (viii) as to
provisions in the Transaction Documents which waive objection to jurisdiction,
the manner of service of process, notice or the effects of delay or failure to
exercise rights and remedies.
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(d) We are qualified to practice law in the States of Michigan and we
do not purport to express any opinion herein concerning any laws other than the
laws of the State of Michigan and applicable federal law. In this regard, we
have noted that the Transaction Documents expressly provide that they are to be
governed by the laws of the State of New York.
(e) This opinion is predicated solely upon laws and regulations in
existence as of the present date and as they presently apply, and to the facts
as they presently exist. We assume no obligation to revise or supplement this
opinion should the present laws be changed by legislative action, judicial
decision or otherwise.
Whenever in this opinion we have used the phrase "to the best of our
knowledge" (or similar terms), this means the conscious awareness of those
attorneys in the Firm who have active involvement in the preparation of this
opinion or who are primarily responsible for providing the response concerning
a particular opinion issue or information regarding factual matters.
This opinion is rendered to you solely for your benefit in connection
with the above transactions and may not be relied upon by you for any other
purpose or by any other persons without our prior written consent. This opinion
is limited to the matters set forth herein and no opinion is intended to be
implied or inferred beyond those expressly stated herein.
Very truly yours,
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Schedule I
Financial Institutions
[to come]
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EXHIBIT I
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
This ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement") dated as
of ___________, 19__ is made between ____________________________________ (the
"Assignor" and ___________________________________________(the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Three Year Credit
Agreement dated as of October 7, 1994 among KMART CORPORATION, a Michigan
corporation (the "Company"), the banks named therein (including the Assignor,
the "Banks") and Bank of America National Trust and Savings Association, as
Documentation Agent (as from time to time amended, restated, supplemented or
otherwise modified, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to make Committed Loans (the "Committed Loans") to the Company in an
aggregate principal amount at any one time ($________) (the "Aggregate
Commitment");
WHEREAS, {the Assignor has made Committed Loans in the aggregate
outstanding principal amount of $____________ to the Company} {no Committed
Loans are outstanding under the Credit Agreement};
WHEREAS, the Assignor wishes to assign to the Assignee part of the
rights and obligations of the Assignor under the Credit Agreement in respect of
its Aggregate Commitment {together with a corresponding portion of each of its
outstanding Committed Loans,} in an amount equal to $____________ (the
"Assigned Amount") on the terms listed on Schedule I hereto and subject to the
conditions set forth herein, and the Assignee wishes to accept assignment of
such rights and to assume such obligations from the Assignor on such terms and
subject to such conditions;
WHEREAS, the Assignee will have no interest in any Absolute Rate Bid
Loans or LIBOR Bid Loans made by the Assignor;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
1. Assignment and Assumption.
(a) With effect on and after the Effective Date (as defined in
Section 5 hereof), the Assignor hereby sells and assigns to the Assignee, and
the Assignee hereby purchases and assumes from the Assignor, the Assigned
Amount, which shall be equal to __ percent
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(______%) (the "Assignee's Percentage Share") of all of the Assignor's rights
and obligations under the Credit Agreement, including, without limitation, the
Assignee's Percentage Share of the Aggregate Commitment [and any outstanding
Committed Loans made by the Assignor]. The sale, assignment, purchase and
assumption set forth in this Section 1(a) shall be without recourse to, or
representation or warranty (except as expressly provided in this Agreement) by,
the Assignor.
(b) With effect on and after the Effective Date, the Assignee shall
be a party to the Credit Agreement and succeed to all of the rights and be
obligated to perform all of the obligations of a Bank under the Credit
Agreement, including the requirements concerning confidentiality, with a
Commitment in an amount equal to the Assigned Amount. The Assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a Bank.
It is the intent of the parties hereto that the Commitment of the Assignor
shall, as of the Effective Date, be reduced by an amount equal to the Assigned
Amount and the Assignor shall relinquish its rights and be released from its
obligations under the Credit Agreement to the extent such obligations have been
assumed by the Assignee.
(c) After giving effect to the assignment and assumption, on the
Effective Date the Assignee's Commitment will be $________. After giving effect
to the assignment and assumption, on the Effective Date the Assignor's
Commitment will be $________.
2. Payments.
(a) As consideration for the sale and assignment contemplated in
Section 1 hereof, the Assignee shall pay to the Assignor on the Effective Date
in immediately available funds an amount equal to $________, representing the
Assignee's Percentage Share of the principal amount of all Committed Loans
previously made, and currently owned, by the Assignor to the Company under the
Credit Agreement and outstanding on the Effective Date.
(b) The [Assignor] [Assignee] further agrees to pay to the
Documentation Agent a processing fee in the amount of $3,000.
(c) To the extent payment to be made by the Assignee pursuant to
Section 2(a) hereof is not made when due, the Assignor shall be entitled to
recover from the Assignee such amount together with interest thereon at the
Federal Funds Rate per annum accruing from the date such amounts were due.
3. Reallocation of Payments.
Any interest, commissions, fees and other payments accrued to but
excluding the Effective Date with respect to the Committed
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Loans and the Assignor's Commitment, shall be for the account of the Assignor.
Any interest, fees and other payments accrued on and after the Effective Date
with respect to the Assigned Amount shall be for the account of the Assignee.
Each of the Assignor and the Assignee agrees that it will hold in trust for the
other party any interest, commissions, fees and other amounts which it may
receive to which the other party is entitled pursuant to the preceding two
sentences and pay to the other party any such amounts which it may receive
promptly upon receipt. The Assignor's and the Assignee's obligations to make
the payments referred to in this Section 3 are non-assignable.
4. Independent Credit Decision.
The Assignee (a) acknowledges that it has received a copy of the Credit
Agreement and the Schedules and Exhibits thereto, together with copies of the
financial statements referred to in Section 6.01 thereof, and such other
documents and information as it has deemed appropriate to make its own credit
and legal analysis and decision to enter into this Agreement; and (b) agrees
that it will, independently and without reliance upon the Assignor, the
Administrative Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit and legal decisions in taking or not taking action under the Credit
Agreement.
5. Effective Date; Notices.
(a) The effective date for this Agreement is ____________ (the
"Effective Date"); provided, that the following conditions precedent have been
satisfied on or before the Effective Date:
(i) this Agreement shall be executed and delivered by the
Assignor and the Assignee;
[(ii) the consent of the Company and the Documentation Agent
required for an effective assignment of the Assigned Amount by the
Assignor to the Assignee shall have been duly obtained and shall be in
full force and effect as of the Effective Date;]
(iii) the Assignee shall pay to the Assignor all amounts due
to the Assignor under this Agreement; and
(iv) the processing fee referred to in Section 2(b) of this
Agreement and in Section 10.08(a) of the Credit Agreement shall have
been paid by the [Assignor] [Assignee] to the Documentation Agent.
(b) Promptly following the execution of this Agreement, the Assignor
shall deliver to the Documentation Agent for acceptance
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and recording by the Documentation Agent, such notices, agreements or other
documents as may be required under the Credit Agreement.
[6. Agent [INCLUDE ONLY IF ASSIGNOR IS DOCUMENTATION AGENT].
(a) The Assignee hereby appoints and authorizes the Assignor to take
such action as Documentation Agent on its behalf and to exercise such powers
under the Credit Agreement as are delegated to the Documentation Agent by the
Banks pursuant to the terms of the Credit Agreement.
(b) The Assignee shall assume no duties or obligations held by the
Assignor in its capacity as Documentation Agent under the Credit Agreement.]
7. Withholding Tax.
If the Assignee is a foreign person within the meaning of the Code, the
Assignee agrees to comply with Section 9.10 of the Credit Agreement as if the
Effective Date were the Closing Date of the Credit Agreement and, if such
Assignee fails to comply with Section 9.10 of the Credit Agreement, then this
Agreement shall not become effective.
8. Representations and Warranties.
(a) The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any lien, security interest or other adverse
claim; (ii) it is duly organized and existing and it has the full power and
authority to take, and has taken, all action necessary to execute and deliver
this Agreement and any other documents required or permitted to be executed or
delivered by it in connection with this Agreement and to fulfill its
obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any Person are required (other than any already given or
obtained) for its due execution, delivery and performance of this Agreement,
and apart from any agreements or undertaking or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person is
required of it for such execution, delivery or performance; and (iv) this
Agreement has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignor, enforceable against the Assignor
in accordance with the terms hereof, subject, as to enforcement, to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors' rights and to general equitable principles.
(b) The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the
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Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto. The Assignor makes no
representation or warranty in connection with, and assumes no responsibility
with respect to, the solvency, financial condition or statements of the Company
or any Subsidiary or the performance or observance by the Company of any of its
obligations under the Credit Agreement or any other instrument or document
furnished in connection therewith.
(c) The Assignee represents and warrants that (i) it is duly organized
and existing and it has full power and authority to take, and has taken, all
action necessary to execute and deliver this Agreement and any other documents
required or permitted to be executed or delivered by it in connection with this
Agreement, and to fulfill its obligations hereunder; (ii) no notices to, or
consents, authorizations or approvals of, any Person are required (other than
any already given or obtained) for its due execution, delivery and performance
of this Agreement; and apart from any agreements or undertaking or filings
required by the Credit Agreement, no further action by, or notice to, or filing
with, any Person is required of it for such execution, delivery or performance;
(iii) this Agreement has been duly executed and delivered by it and constitutes
the legal, valid and binding obligation of the Assignee, enforceable against
the Assignee in accordance with the terms hereof, except subject, as to
enforcement, to bankruptcy, insolvency, moratorium, reorganization and other
laws of general application relating to or affecting creditors' rights and to
general equitable principles; and (iv) it is an Eligible Assignee under the
Credit Agreement.
9. Further Assurances.
The Assignor and the Assignee each hereby agrees to execute and deliver
such other instruments, and take such other action, as either party may
reasonably request in connection with the transactions contemplated by this
Agreement, including, without limitation, the delivery of any notices or other
documents or instruments to the Company or the Documentation Agent which may be
required in connection with the assignment and assumption contemplated hereby.
10. Indemnity.
The Assignee agrees to indemnify and hold harmless the Assignor against
any and all losses, costs, expenses (including, without limitation, Attorney
Costs) and liabilities incurred by the Assignor in connection with or arising
in any manner from the non-performance by the Assignee of any obligation
assumed by the Assignee under this Agreement.
11. Miscellaneous.
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(a) Any amendment or waiver of any provision of this Agreement shall
be in writing signed by the parties hereto, and consented to in writing by the
Documentation Agent. No failure or delay by either party hereto in exercising
any right, power or privilege hereunder shall operate as a waiver thereof and
any waiver of any breach of the provisions of this Agreement shall be without
prejudice to any rights with respect to any other or further breach hereof.
(b) All payments made hereunder shall be made without any set-off or
counterclaim.
(c) All communications among the parties or notices in connection
herewith shall be in writing (including facsimile transmission or telex) and
delivered, telexed or telecopied, addressed as follows: (i) if to the Assignor
or the Assignee, at their respective addresses set forth on the signature pages
hereof and (ii) if to the Company or the Documentation Agent, at their
respective addresses set forth in the Credit Agreement or any other documents
or instruments delivered pursuant thereto. All such communications and notices
shall be effective upon receipt. The Assignee specifies as its Lending Office
the office set forth beneath its name on the signature pages hereof.
(d) The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution
and performance of this Agreement.
(e) The representations and warranties made herein shall survive the
consummation of the transactions contemplated hereby.
(f) This Agreement shall be binding upon and inure to the benefit of
the Assignor and the Assignee and their respective successors and assigns;
provided, however, that no party shall assign its rights hereunder without the
prior written consent of the other party and any purported assignment, absent
such consent, shall be void. The preceding sentence shall not limit the right
of the Assignee to assign or participate all or part of the Assignee's
Percentage Share and the Assigned Amount and any outstanding Loans attributable
thereto in accordance with and subject to the Credit Agreement.
(g) The Assignor may at any time or from time to time grant to others
assignments or participations in Assignor's Aggregate Commitment or the Loans
but not in the portions thereof assigned to the Assignee pursuant to this
Agreement.
(h) This Agreement may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument.
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(i) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York. The Assignor and the Assignee each
irrevocably submits to the non-exclusive jurisdiction of any New York State or
Federal court sitting in The City of New York over any suit, action or
proceeding arising out of or relating to this Agreement and irrevocably agrees
that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. Each party to this
Agreement hereby irrevocably waives, to the fullest extent it may effectively
do so, the defense of an inconvenient forum to the maintenance of such action
or proceeding.
(j) This Agreement and any agreement, document or instrument attached
hereto or referred to herein integrate all the terms and conditions mentioned
herein or incidental hereto, constitute the entire agreement and understanding
between the parties hereto and supersede any and all prior agreements and
understandings related to the subject matter hereof. In the event of any
conflict between the terms, conditions and provisions of this Agreement and any
such agreement, document or instrument, the terms, conditions and provisions of
this Agreement shall prevail.
(k) In the event of any inconsistency between the provisions of this
Agreement and Schedule I hereto, this Agreement shall control. Headings are for
reference only and are to be ignored in interpreting this Agreement.
(l) The illegality or unenforceability of any provision of this
Agreement or any instrument or agreement required hereunder shall not in any
way affect or impair the legality or enforceability of the remaining provisions
of this Agreement or any instrument or agreement required hereunder.
(m) The Assignor and the Assignee each hereby knowingly, voluntarily
and intentionally waive any rights they may have to a trial by jury in respect
of any litigation based hereon, or arising out of, under, or in connection with
this Agreement, the Credit Agreement, any related documents and agreements or
any related course of conduct, course of dealing or statements (whether oral or
written).
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the date first above written.
____________________________________
Assignor
By:_________________________________
Title:______________________________
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Address for Notices:
Lending Office:
Address for Payments
[Address]
_____________________________________
Assignee
By: _________________________________
Title: ______________________________
Address for Notices:
Lending Office:
Address for Payments
[Address]
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SCHEDULE I
TO
ASSIGNMENT AND ASSUMPTION AGREEMENT
1. Company:
2. Date of Credit Agreement:
3. Assignor:
4. Assignee:
5. Date of Assignment Agreement:
6. Effective Date:
7. Assignee's Share
(a) Assignee's Percentage Share
(b) Assigned Amount
8. Fees: Payment by Company
to Assignee
------------------
Facility Fee
9. Interest: Payment by Company
to Assignee
------------------
(i) Reference Rate Committed Loan(s)
(ii) LIBOR Committed Loan(s)
(iii) CD Rate Committed Loan(s)
10. Payment Instructions:
Assignor:
Assignee:
11. Other Information:
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SCHEDULE II
FORM OF NOTICE OF ASSIGNMENT AND ACCEPTANCE
______________, 19__
Bank of America National Trust
and Savings Association,
as Documentation Agent
000 Xxxxxxxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Agency Management Services
Kmart Corporation
0000 Xxxx Xxx Xxxxxx Xxxx
Xxxx, Xxxxxxxx 00000
Attention: Treasurer
Ladies and Gentlemen:
We refer to the Three Year Credit Agreement dated as of October 7, 1994
(as amended, supplemented or modified from time to time, the "Credit
Agreement") between Kmart Corporation (the "Company"), the Banks referred to
therein and Bank of America National Trust and Savings Association, as
Documentation Agent. Terms defined in the Credit Agreement are used herein as
therein defined.
1. We hereby give you notice of [, and request the consent of the
Company and the Administrative Agent to,] the assignment by ___________________
(the "Assignor") to ________________ (the "Assignee") of ___% of the right,
title and interest of the Assignor in and to the Credit Agreement (including,
without limitation, the right, title and interest of the Assignor in and to the
Commitment of the Assignor and all outstanding Committed Loans made by the
Assignor but excluding any Bid Loans made by the Assignor) pursuant to that
certain Assignment and Assumption Agreement, dated as of ________________, 19__
(the "Assignment and Assumption Agreement"), by and between Assignor and
Assignee. Before giving effect to such assignment the Assignor's Commitment is
$____________, and the aggregate principal amount of its outstanding Committed
Loans is $____________.
2. The Assignee agrees that [, upon receiving the consent of the
Company and the Administrative Agent to such assignment and] from and after the
Effective Date (as such term is defined in Section 5 of the Assignment and
Assumption Agreement), the Assignee will be bound by the terms of the Credit
Agreement, with respect to the interest in the Credit Agreement assigned to it
as specified
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above, as fully and to the same extent as if the Assignee were the Bank
originally holding such interest in the Credit Agreement.
3. The following administrative details apply to the Assignee:
(A) Lending Office:
Assignee name: _____________________
Address: ___________________________
___________________________
Attention: _________________________
Telephone: ( ) ___________________
Telecopier: ( ) __________________
(B) Notice Address:
Assignee name: _____________________
Address: ___________________________
___________________________
Attention: _________________________
Telephone: ( ) ___________________
Telecopier: ( ) __________________
(C) Payment Instructions:
Account No.: _______________________
At: _______________________
_______________________
_______________________
Reference: _________________________
Attention: _________________________
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IN WITNESS WHEREOF, the Assignor and the Assignor have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
[Name of Assignor]
By: ______________________________
Title: ___________________________
[Name of Assignee]
By: ______________________________
Title: ___________________________
[Agreed and Consented to this
____ day of ____________, 19___.
KMART CORPORATION
By: ____________________________
Title: _________________________
Agreed and Consented to this
____ day of ____________, 19___.
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Documentation Agent
By: ____________________________
Title: _________________________}
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EXHIBIT J
FORM OF LETTER OF CREDIT REQUEST
TO: Documentation Agent
[and the applicable Facing Agent]
Pursuant to Section 2.16(b) of the Three Year Credit Agreement dated as
of October 7, 1994 among Kmart Corporation ("Borrower"), the financial
institutions party thereto and Bank of America National Trust and Savings
Association, as Documentation Agent, Borrower hereby requests the issuance of
the [Standby/Trade] Letter of Credit described below:
1. Facing Agent: ____________________________________.
2. Issuance Date: ___________________________________.(1)
3. Requested Expiration Date: _______________________.(2)
4. Name and Address of Beneficiary:
______________________________________
______________________________________
______________________________________
5. Stated Amount: _______________________.
6. Other Terms and Conditions of Proposed Letter of Credit:(3)
______________________________________
______________________________________
7. Other Information requested by the Documentation Agent or the
applicable Facing Agent (including, if applicable, the Facing Agent's
form of Letter of Credit Application):
______________________________________
______________________________________
In the case of Trade Letters of Credit, Borrower shall also provide to
the Facing Agent such other information regarding the sale or shipment of goods
and the documents evidencing same as may be required on the Facing Agent's
standard application for trade letters of credit.
This Letter of Credit Request constitutes the representation and
warranty of Borrower as of each of the date hereof and the Issuance Date set
forth in paragraph 2 hereof that each of the
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conditions set forth in Section 4.02 of the Credit Agreement has been
satisfied.
This Letter of Credit Request together with any attachment hereto
constitutes a Loan Document executed and delivered pursuant to the Agreement.
Capitalized terms used and not otherwise defined herein shall have the
respective meanings provided in the Credit Agreement.
This Letter of Credit Request may be executed in one or more
counterparts, each of which shall be an original, and all of which taken
together shall constitute one instrument.
IN WITNESS WHEREOF, Borrower has caused this Letter of Credit Request
to be executed by its officer thereunto duly authorized as of the date set
forth below.
KMART CORPORATION
Dated as of:__________________ By:____________________________
Name:
Title:
The foregoing Letter of Credit
Request dated as of __________
is hereby approved.
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Documentation Agent
By:____________________________
Name:
Title:
______________________________,
as Facing Agent
By:____________________________
Name:
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Title:
1. At least five Business Days' prior notice is required.
Section 2.16(b)
2. Expiration date must be one year or less from date of issuance;
provided, that each Standby Letter of Credit may provide by its terms
that it will be automatically renewed for additional successive periods
of up to one (1) year unless the applicable Facing Agent shall have
given notice to the applicable beneficiary (with a copy to Borrower) of
the election by the Facing Agent (such election to be in the sole and
absolute discretion of the Facing Agent) not to extend such Letter of
Credit, such notice to be given not less than thirty (30) days prior to
the then current expiration date of the Letter of Credit; provided,
further, that no Standby Letter of Credit or renewal thereof shall be
stated to expire later than the Termination Date and no Trade Letter of
Credit or renewal thereof shall be stated to expire later than the day
thirty (30) days prior to the Termination Date. Section 2.16(a)(ii).
3. If possible, it would be preferable to attach a copy of the text
of the proposed Letter of Credit and incorporate it herein by
reference, although the text of the proposed Letter of Credit may be
changed during the course of discussions between the Facing Agent and
Borrower.
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