EXHIBIT 4.07
================================================================================
CREDIT AGREEMENT
among
FLEXTRONICS INTERNATIONAL LTD. and
DESIGNATED BORROWERS
and
THE LENDERS NAMED HEREIN
and
ABN AMRO BANK N.V.,
as Co-Lead Arranger, Bookrunner and Agent for the Lenders
and
FLEET NATIONAL BANK,
as Co-Lead Arranger, Syndication Agent and Issuing Bank
and
CITICORP USA, INC.,
DEUTSCHE BANC SECURITIES INC., CREDIT SUISSE FIRST BOSTON,
BANK OF AMERICA, N.A., and SCOTIA CAPITAL
as Co-Syndication Agents
and
BNP PARIBAS and KEYBANK NATIONAL ASSOCIATION
as Senior Managing Agents
and
XXXXXX COMMERCIAL PAPER INC., ROYAL BANK OF CANADA,
HSBC BANK USA, UBS AG, STAMFORD BRANCH
as Managing Agents
March 3, 2004
================================================================================
TABLE OF CONTENTS
PAGE
SECTION I. INTERPRETATION................................................................................ 2
1.01. Definitions................................................................................... 2
1.02. GAAP.......................................................................................... 17
1.03. Headings...................................................................................... 18
1.04. Plural Terms.................................................................................. 18
1.05. Governing Law................................................................................. 18
1.06. English Language.............................................................................. 18
1.07. Construction.................................................................................. 18
1.08. Entire Agreement.............................................................................. 18
1.09. Calculation of Interest and Fees.............................................................. 18
1.10. References.................................................................................... 18
1.11. Other Interpretive Provisions................................................................. 19
SECTION II. CREDIT FACILITIES............................................................................. 19
2.01. Loans and Letters of Credit................................................................... 19
2.02. Notice of Borrowing........................................................................... 24
2.03. Interest...................................................................................... 24
2.04. Purpose....................................................................................... 26
2.05. Amount Limitations, Commitment Reductions, Etc................................................ 26
2.06. Fees.......................................................................................... 26
2.07. Prepayments................................................................................... 27
2.08. Other Payment Terms........................................................................... 28
2.09. Loan Accounts; Notes.......................................................................... 29
2.10. Loan Funding.................................................................................. 30
2.11. Pro Rata Treatment............................................................................ 30
2.12. Change of Circumstances....................................................................... 31
2.13. Taxes on Payments............................................................................. 33
2.14. Funding Loss Indemnification.................................................................. 35
2.15. Security...................................................................................... 35
2.16. Replacement of Lenders........................................................................ 36
SECTION III. CONDITIONS PRECEDENT.......................................................................... 36
3.01. Initial Conditions Precedent.................................................................. 36
3.02. Conditions Precedent to Each Credit Event..................................................... 37
3.03. Covenant to Deliver........................................................................... 37
3.04. Conditions Precedent to Adding Designated Borrower............................................ 37
SECTION IV. REPRESENTATIONS AND WARRANTIES................................................................ 37
4.01. Borrowers' Representations and Warranties..................................................... 37
i
TABLE OF CONTENTS
(CONTINUED)
PAGE
4.02. Reaffirmation................................................................................. 42
SECTION V. COVENANTS..................................................................................... 42
5.01. Affirmative Covenants......................................................................... 42
5.02. Negative Covenants............................................................................ 45
5.03. Financial Covenants........................................................................... 50
SECTION VI. DEFAULT....................................................................................... 51
6.01. Events of Default............................................................................. 51
6.02. Remedies...................................................................................... 53
6.03. Lender Rate Contract Remedies................................................................. 53
SECTION VII. THE AGENT AND RELATIONS AMONG LENDERS......................................................... 53
7.01. Appointment, Powers and Immunities............................................................ 53
7.02. Reliance by Agent............................................................................. 54
7.03. Defaults...................................................................................... 54
7.04. Indemnification............................................................................... 54
7.05. Non-Reliance.................................................................................. 54
7.06. Resignation or Removal of Agent............................................................... 55
7.07. Agent in its Individual Capacity.............................................................. 55
7.08. Co-Arrangers, Co-Syndication Agents, Senior Managing Agents Managing Agents and
Documentation Agent........................................................................ 55
SECTION VIII. MISCELLANEOUS................................................................................. 55
8.01. Notices....................................................................................... 55
8.02. Expenses...................................................................................... 57
8.03. Indemnification............................................................................... 57
8.04. Waivers; Amendments........................................................................... 57
8.05. Successors and Assigns........................................................................ 58
8.06. Set-off; Security Interest.................................................................... 60
8.07. No Third Party Rights......................................................................... 61
8.08. Partial Invalidity............................................................................ 61
8.09. Jury Trial.................................................................................... 61
8.10. Counterparts.................................................................................. 61
8.11. Borrowers' Liabilities........................................................................ 61
8.12. Confidentiality............................................................................... 61
8.13. Consent to Jurisdiction....................................................................... 61
8.14. Usury......................................................................................... 62
8.15. Hong Kong Branch; Full Recourse Obligations................................................... 62
ii
TABLE OF CONTENTS
(CONTINUED)
PAGE
EXHIBITS
A Notice of Borrowing
B Form of Note
C Form of Guaranty
D Form of Assignment Agreement
iii
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of March 3, 2004, is entered into by
and among:
(1) FLEXTRONICS INTERNATIONAL LTD., a Singapore
corporation ("FIL") acting, subject to Paragraph 8.15 hereof, through
its Hong Kong branch, and each of the Subsidiaries of FIL designated as
borrowers from time to time, as approved by each Lender (as defined
below), the Issuing Bank and Guarantors hereunder (such subsidiaries to
be referred to herein collectively as "Designated Borrowers");
(2) Each of the financial institutions from time to time
listed in Schedule I hereto, as amended from time to time (such
financial institutions to be referred to herein collectively as the
"Lenders");
(3) ABN AMRO BANK N.V. ("ABN AMRO"), as administrative
agent for the Lenders (in such capacity, "Agent") and as sole
bookrunner (in such capacity, the "Bookrunner");
(4) ABN AMRO and FLEET NATIONAL BANK, as co-lead
arrangers (collectively, in such capacity, the "Co-Arrangers");
(5) DEUTSCHE BANK SECURITIES INC., BANK OF AMERICA, N.A.,
CITICORP USA, INC., CREDIT SUISSE FIRST BOSTON and SCOTIA CAPITAL as
co-syndication agents (collectively, in such capacity, the
"Co-Syndication Agents");
(6) BNP PARIBAS and KEYBANK NATIONAL ASSOCIATION, as
senior managing agents (collectively, in such capacity, the "Senior
Managing Agents");
(7) XXXXXX COMMERCIAL PAPER INC., UBS AG, STAMFORD
BRANCH, HSBC BANK USA and ROYAL BANK OF CANADA as managing agents
(collectively, in such capacity, the "Managing Agents");
(8) FLEET NATIONAL BANK, as documentation agent (in such
capacity, the "Documentation Agent"); and
(9) FLEET NATIONAL BANK, as the issuer of letters of
credit hereunder, (in such capacity, the "Issuing Bank").
RECITALS
A. FIL has requested Lenders to provide certain credit facilities
to FIL and Designated Borrowers (collectively, "Borrowers").
B. Lenders are willing to provide such credit facilities upon the
terms and subject to the conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the above Recitals and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION I. INTERPRETATION.
1.01. Definitions. Unless otherwise indicated in this Agreement or
any other Credit Document, each term set forth below, when used in this
Agreement or any other Credit Document, shall have the respective meaning given
to that term below or in the provision of this Agreement or other document,
instrument or agreement referenced below.
"ABN AMRO" shall have the meaning given to that term in clause
(3) of the introductory paragraph hereof.
"Affiliate" shall mean, with respect to any Person, each other
Person that (a) directly or indirectly, owns or controls, whether
beneficially or as a trustee, guardian or other fiduciary, ten percent
(10%) or more of any class of Equity Securities of such Person or (b)
that controls, is controlled by or is under common control with such
Person or any Affiliate of such Person; provided, however, that in no
case shall Agent or any Lender be deemed to be an Affiliate of any
Borrower or any of FIL's Subsidiaries for purposes of this Agreement.
For the purpose of this definition, "control" of a Person shall mean
the possession, directly or indirectly, of the power to direct or cause
the direction of its management or policies, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" shall have the meaning given to that term in clause
(3) of the introductory paragraph hereof.
"Agent's Fee Letter" shall mean the fee letter agreement dated
as of January 20, 2004 between FIL and Agent.
"Agent's Fees" shall have the meaning given to that term in
Subparagraph 2.06(a) hereof.
"Agreement" shall mean this Credit Agreement.
"Alternative Currency" shall mean any Currency (other than
United States Dollars).
"Applicable Lending Office" shall mean, with respect to any
Lender and any Borrowing, such Lender's Lending Office.
"Applicable Margin" shall mean, with respect to any Borrowing
at any time, the per annum margin which is determined pursuant to the
Pricing Grid and added to the Base Rate or LIBO Rate, as the case may
be, for such Borrowing; provided, however, that the Applicable Margin
determined pursuant to the Pricing Grid shall be increased by two
percent (2.00%) per annum on the date an Event of Default occurs and
shall continue at such increased rate unless and until such Event of
Default is cured or waived in accordance with this Agreement. The
Applicable Margin shall be determined as provided in the Pricing Grid
(subject to the proviso in the preceding sentence) and may change as
provided in the Pricing Grid.
"Applicable Payment Office" shall have the meaning given to
that term in Subparagraph 2.13(b).
"Applicable Rate Page" shall mean, with respect to any
Currency at any time, the applicable Telerate Page on which appears the
London Interbank Offered Rate for deposits in such currency at such
time or, if no such page is then available, the applicable Reuters
Screen Page on which such information then appears.
"Approved Fund" shall mean any Fund that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity
or an Affiliate of an entity that administers or manages a Lender.
"Assignee Lender" shall have the meaning given to that term in
Subparagraph 8.05(c) hereof.
"Assignment" shall have the meaning given to that term in
Subparagraph 8.05(c) hereof.
2
"Assignment and Assumption" shall have the meaning given to
that term in Subparagraph 8.05(c) hereof.
"Assignment Effective Date" shall have, with respect to each
Assignment and Assumption, the meaning set forth therein.
"Assignor Lender" shall have the meaning given to that term in
Subparagraph 8.05(c) hereof.
"Base Rate" shall mean, on any day, the greater of (a) the
Prime Rate in effect on such date and (b) the Federal Funds Rate for
such day plus one-half of one percent (0.50%).
"Base Rate Borrowing" shall mean any Borrowing consisting of
Base Rate Loans.
"Base Rate Loan" shall mean any Loan bearing interest based
upon the Base Rate.
"Borrowers" shall have the meaning given to that term in
Recital A.
"Borrowing" shall mean a borrowing consisting of all the Loans
of the same Currency and Type (and same Interest Period if LIBOR Loans)
made, converted or continued by Lenders on the same date. Any reference
to a Borrowing shall include all the Loans constituting such Borrowing.
"Business Day" shall mean any day on which commercial banks
are not authorized or required to close in San Francisco, California,
New York, New York, or Chicago, Illinois, other than Saturday or
Sunday, and (a) if such Business Day is related to a Borrowing in
United States Dollars, dealings in Dollar deposits are carried out in
the London interbank market and commercial banks are open for business
in London or (b) if such Business Day is related to a Borrowing in an
Alternative Currency, dealings in such Currency are carried out in the
London interbank market and commercial banks are open for business in
London.
"Capital Adequacy Requirement" shall have the meaning given to
that term in Subparagraph 2.12(d) hereof.
"Capital Leases" shall mean any and all lease obligations
that, in accordance with GAAP, are required to be capitalized on the
books of a lessee.
"Change of Control" shall mean, with respect to FIL, (i) the
acquisition after the date hereof by any person or group of persons
(within the meaning of Section 13 or 14 of the Securities Exchange Act
of 1934 (as amended, the "Exchange Act")) of (A) beneficial ownership
(within the meaning of Rule 13d-3 promulgated by the Securities and
Exchange Commission under the Exchange Act) of fifty percent (50%) or
more of the outstanding Equity Securities of FIL entitled to vote for
members of the board of directors, or (B) all or substantially all of
the assets of FIL; (ii) during any period of twelve (12) consecutive
calendar months, individuals who are directors of FIL on the first day
of such period ("Initial Directors") and any directors of FIL who are
specifically approved by two-thirds of the Initial Directors and
previously-approved Directors shall cease to constitute a majority of
the Board of Directors of FIL before the end of such period; or (iii)
any other event or condition constituting a "Change of Control" (or
similar defined term) under any Subordinated Indenture shall occur or
exist.
"Change of Law" shall have the meaning given to that term in
Subparagraph 2.12(b) hereof.
"Closing Date" shall mean March 3, 2004.
"Co-Arrangers" shall have the meaning given to that term in
clause (4) of the introductory paragraph hereof.
3
"Combined Commitment" shall mean, with respect to any Lender
under this Agreement at any time, the sum of (a) such Lender's
Commitment at such time and (b) such Lender's "Commitment" as defined
in the FIUI Credit Agreement at such time.
"Combined Proportionate Share" shall mean:
(a) With respect to any Lender under this
Agreement or under the FIUI Credit Agreement at any time prior
to the termination of the Commitments, the ratio (expressed as
a percentage rounded to the eighth digit to the right of the
decimal point) of (i) such Lender's Combined Commitment at
such time to (ii) the Combined Total Commitment at such time;
and
(b) With respect to any Lender under this
Agreement or under the FIUI Credit Agreement at any time after
the termination of the Commitments, the ratio (expressed as a
percentage rounded to the eighth digit to the right of the
decimal point) of (i) the sum at such time of (A) the
aggregate principal amount of all Loans owed to such Lender
and outstanding at such time under this Agreement, (B) such
Lender's pro rata share of the aggregate amount available for
drawing under all Letters of Credit outstanding at such time
under this Agreement, (C) such Lender's pro rata share of the
aggregate amount of all Reimbursement Obligations outstanding
at such time under this Agreement, (D) the aggregate principal
amount of all Loans owed to such Lender and outstanding at
such time under the FIUI Credit Agreement, (E) such Lender's
pro rata share of the aggregate amount available for drawing
under all Letters of Credit outstanding at such time under the
FIUI Credit Agreement and (F) such Lender's pro rata share of
the aggregate amount of all Reimbursement Obligations
outstanding at such time under the FIUI Credit Agreement to
(ii) the sum at such time of (A) the aggregate principal
amount of all Loans outstanding at such time under this
Agreement, (B) the aggregate amount available for drawing
under all Letters of Credit outstanding at such time under
this Agreement, (C) the aggregate amount of all Reimbursement
Obligations outstanding at such time under this Agreement, (D)
the aggregate principal amount of all Loans outstanding at
such time under the FIUI Credit Agreement, (E) the aggregate
amount available for drawing under all Letters of Credit
outstanding at such time under the FIUI Credit Agreement and
(F) the aggregate amount of all Reimbursement Obligations
outstanding at such time under the FIUI Credit Agreement.
"Combined Total Commitment" shall mean the sum of (a) the
Total Commitment and (b) the "Total Commitment" as defined in the FIUI
Credit Agreement.
"Combined Required Lenders" shall mean, at any time, Lenders
under this Agreement and Lenders under the FIUI Credit Agreement whose
Combined Proportionate Shares equal or exceed fifty-one percent (51%)
at such time, except at any time any Lender under this Agreement or
under the FIUI Credit Agreement is a Defaulting Lender. (For the
purposes of determining "Required Lenders" at any time any Lender is a
Defaulting Lender, the "Combined Proportionate Shares" of
non-defaulting Lenders shall be determined excluding from the
Commitment the aggregate amounts of the Defaulting Lenders'
Commitments; and "Combined Required Lenders" shall mean non-defaulting
Lenders whose Combined Proportionate Shares as so determined then equal
or exceed fifty-one percent (51%).)
"Commitment" shall mean, with respect to each Lender, the
Dollar amount set forth under the caption "Commitment" opposite such
Lender's name on Part A of Schedule I, or, if changed, such Dollar
amount as may be set forth for such Lender in the Register.
"Commitment Fees" shall have the meaning given to that term in
Subparagraph 2.06(b) hereof.
"Commitment Fee Percentage" shall mean the per annum
percentage which is used to calculate the Commitment Fees. The
Commitment Fee Percentage shall be determined as provided in the
Pricing Grid and may change as provided in the Pricing Grid.
4
"Commitment Letter" shall mean the commitment letter agreement
dated as of January 20, 2004 between FIL and ABN AMRO.
"Compliance Certificate" shall have the meaning given to that
term in Subparagraph 5.01(a)(iii) hereof.
"Consolidated Tangible Assets" shall mean, with respect to
FIL, the aggregate amount of assets (determined on a consolidated basis
and in accordance with GAAP) after deducting therefrom all goodwill,
trade names, trademarks, patents, licenses, unamortized debt discount
and expense, treasury stock and other like intangibles (in each case,
determined on a consolidated basis and in accordance with GAAP).
"Contingent Obligation" shall mean, without duplication, with
respect to any Person, (a) any Guaranty Obligation of that Person and
(b) any direct or indirect obligation or liability, contingent or
otherwise, of that Person (i) in respect of any Surety Instrument
issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings or payments or (ii) in
respect to any Rate Contract that is not entered into in connection
with a bona fide hedging operation that provides offsetting benefits to
such Person. The amount of any Contingent Obligation shall (subject, in
the case of Guaranty Obligations, to the last sentence of the
definition of "Guaranty Obligation") be deemed equal to the maximum
reasonably anticipated liability in respect thereof (subject to
reduction as the underlying liability so guaranteed is reduced from
time to time), and shall, with respect to item (b)(ii) of this
definition, be marked to market on a current basis.
"Contractual Obligation" of any Person shall mean, any
indenture, note, lease, loan agreement, security, deed of trust,
mortgage, security agreement, guaranty, instrument, contract, agreement
or other form of contractual obligation or undertaking to which such
Person is a party or by which such Person or any of its property is
bound.
"Co-Syndication Agents" shall have the meaning given to that
term in clause (5) of the introductory paragraph hereof.
"Credit Documents" shall mean and include this Agreement, the
LC Applications, the Notes, the Security Documents, the Agent's Fee
Letter, the FIUI Credit Documents, all other documents, instruments and
agreements delivered to the Agent pursuant to Section III hereof and
all other documents, instruments and agreements delivered by any
Borrower, any Guarantor or any of FIL's Subsidiaries to Agent or the
Issuing Bank in connection with this Agreement on or after the date of
this Agreement.
"Credit Event" shall mean (a) any Borrowing or (b) the
issuance, amendment, renewal or extension of any Letter of Credit.
"Currencies" shall mean United States Dollars, United Kingdom
pounds and Euros.
"Debt/EBITDA Ratio" shall mean, with respect to FIL for any
period, the ratio, determined on a consolidated basis in accordance
with GAAP, of:
(a) The total Indebtedness of FIL and its
Subsidiaries on the last day of such period; provided,
however, that in computing the foregoing sum, there shall be
excluded therefrom any Indebtedness to the extent the proceeds
of which are (i) legally segregated from FIL's or such
Subsidiaries' other assets and (ii) either (A) only held in
the form of cash or cash equivalents or (B) used by FIL or its
Subsidiaries for any such purpose as may be approved in
advance from time to time by the Required Lenders;
to
(b) EBITDA for such period.
5
"Default" shall mean an Event of Default or any event or
circumstance not yet constituting an Event of Default which, with the
giving of any notice or the lapse of any period of time or both, would
become an Event of Default.
"Defaulted Amount" shall have the meaning given to that term
in the definition of "Defaulting Lender" hereof.
"Defaulting Lender" shall mean a Lender which has failed to
fund its portion of any Borrowing which it is required to fund under
this Agreement (such amount, the "Defaulted Amount") and has continued
in such failure for three (3) Business Days after written notice from
Agent, provided that any Defaulting Lender shall cease to be a
Defaulting Lender upon (x) its funding the Defaulted Amount or (y) the
termination of the Commitments.
"Designated Borrower" shall have the meaning given to that
term in clause (1) of the introductory paragraph hereof.
"Documentation Agent" shall have the meaning given to that
term in clause (8) of the introductory paragraph hereof.
"Dollar Equivalent" shall mean, as to any amount denominated
in an Alternative Currency as of any date of determination, the amount
of Dollars that would be required to purchase the amount of such
Alternative Currency based upon the spot selling rate at which ABN
AMRO's London office offers to sell such Alternative Currency for
Dollars in the London foreign exchange market at approximately 11:00
a.m. London time on such date for delivery two (2) Business Days later.
"Dollars" and "$" shall mean, unless otherwise indicated, the
lawful currency of the United States of America and, in relation to any
payment under this Agreement, in same day or immediately available
funds.
"Drawing Payment" shall have the meaning given to that term in
Subparagraph 2.01(b)(iii)(A) hereof.
"EBITDA" shall mean, with respect to FIL for any consecutive
four quarter-period, the sum, determined on a consolidated basis in
accordance with GAAP, of the following:
(a) The net income or net loss of FIL for such
period before provision for income taxes;
plus
(b) The sum (without duplication and to the
extent deducted in calculating net income or loss in clause
(a) above) of (i) all Interest Expense of FIL accruing during
such period, (ii) all depreciation and amortization expenses
of FIL accruing during such period and (iii) other noncash
charges for such period; provided, however, that cash payments
made in any future period in respect of such noncash charges
shall be subtracted from EBITDA in the period when such
payments are made;
plus
(c) An amount, not to exceed Fifty Million
Dollars ($50,000,000) in any consecutive four-quarter period,
equal to the sum (without duplication and to the extent
deducted in calculating net income or loss in clause (a)
above) of (i) all charges (other than non-cash charges added
pursuant to clause (b) above) associated with merger- or
acquisition-related expenses and restructuring costs paid in
such period (in each case calculated in accordance with GAAP)
incurred by FIL in connection with any merger, acquisition or
restructuring entered into
6
by FIL and any of its Subsidiaries which is otherwise
permitted under this Agreement and the FIUI Credit Agreement;
plus
(d) For the consecutive four-quarter period
ended on or prior to the date that is one year after the later
of (i) the Closing Date and (ii) the Nortel Closing Date (or
September 30, 2004, if the Nortel Closing Date shall not have
occurred by such date), an amount, not to exceed Fifty Million
Dollars ($50,000,000), equal to the sum (without duplication
and to the extent deducted in calculating net income or loss
in clause (a) above) of (i) all charges (other than non-cash
charges added pursuant to clause (b)) associated with merger-
or acquisition-related expenses and restructuring costs paid
in such period (in each case calculated in accordance with
GAAP) incurred by FIL in connection with New Program
Acquisitions and (ii) all charges (other than non-cash charges
added pursuant to clause (b) above) paid in such period
(calculated in accordance with GAAP) in connection with the
closing of any plant or similar facility that is directly
related to any New Program Acquisition;
plus
(e) For the consecutive four-quarter periods
ended on March 31, 2004 and June 30, 2004, an amount, not to
exceed One Hundred Ten Million Dollars ($110,000,000), equal
to the charges (without duplication and to the extent deducted
in calculating net income or loss in clause (a) above)
incurred by FIL in connection with the early redemption by FIL
of its 9.875% Senior Subordinated Notes due 2010, to the
extent such charges constitute a "Loss on Early Extinguishment
of Debt" (as such term is defined under GAAP).
For purposes of Subparagraph 5.03(a) only (and not for
purposes of Subparagraph 5.03(b)), if FIL or any of its
Subsidiaries acquires (whether by purchase, merger,
consolidation or otherwise) all or substantially all of the
assets or property of any other Person, during any period in
respect of which EBITDA is to be determined, such EBITDA shall
be determined on a pro forma basis in accordance with GAAP as
if such acquisition occurred as of the first day of such
period.
"Eligible Assignee" shall mean (a) a Lender, (b) an Affiliate
of a Lender, (c) an Approved Fund, and (d) any other Person (other than
a natural person) approved by (i) Agent, (ii) Issuing Bank, and (iii)
unless an Event of Default has occurred under clause (a), (f) or (g) of
Paragraph 6.01 and is continuing, Borrower (each such approval not to
be unreasonably withheld or delayed), provided that notwithstanding the
foregoing, "Eligible Assignee" shall not include any Borrower or any
Borrower's Affiliates or Subsidiaries.
"Eligible Material Subsidiary" shall mean, at any time, any
Material Subsidiary that is not then an Ineligible Material Subsidiary.
"Employee Benefit Plan" shall mean any employee benefit plan
within the meaning of section 3(3) of ERISA maintained or contributed
to by any Borrower, any Material Subsidiary or any ERISA Affiliate,
other than a Multiemployer Plan.
"Environmental Laws" shall mean all the Governmental Rules and
Contractual Obligations relating to the protection of human health and
the environment, including those pertaining to the reporting,
licensing, permitting, investigation or remediation of emissions,
discharges, releases, or threatened releases of Hazardous Materials
into the air, surface water, groundwater, or land, or relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transportation, handling of, or exposure to, Hazardous
Materials.
"Equity Securities" of any Person shall mean (a) all common
stock, preferred stock, participations, shares, partnership interests,
membership interests, beneficial interests in a trust or other equity
interests in
7
and of such Person (regardless of how designated and whether or not
voting or non-voting) and (b) all warrants, options and other rights to
acquire any of the foregoing.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as the same may from time to time be amended or supplemented,
including any rules or regulations issued in connection therewith.
"ERISA Affiliate" shall mean any Person which is treated as a
single employer with any Borrower or any Material Subsidiary under
Section 414 of the IRC.
"Euro" shall mean the single currency of participating member
states of the European Union.
"Event of Default" shall have the meaning given to that term
in Paragraph 6.01 hereof.
"Excluded Taxes" shall mean all Taxes measured by or imposed
upon the overall net income of any Lender or one of its Applicable
Lending Offices and all franchise taxes imposed upon any Lender, in
each case imposed (i) by the jurisdiction under the laws of which such
Lender or one of its Applicable Lending Offices is organized or is
located, or in which its principal executive office is located, or any
nation within which such jurisdiction is located or any political
subdivision thereof or (ii) by reason of any connection between the
jurisdiction imposing such tax and such Lender or one of its Applicable
Lending Offices other than a connection arising solely from such Lender
having executed, delivered or performed its obligations under, or
received payment under or enforced, this Agreement or any of the other
Credit Documents.
"Existing FIL Credit Agreement" shall mean the Credit
Agreement dated as of March 8, 2002, as amended, among FIL, ABN AMRO
and other lending institutions, and ABN AMRO, as agent for itself and
such other lending institutions.
"Existing Letter of Credit" shall mean each letter of credit
previously issued for the account of any Borrower that (a) is
outstanding on the Closing Date and (b) is listed on Schedule 2.01.
"Existing Secured Indebtedness" shall mean the secured
Indebtedness existing on the Closing Date specified on Schedule
5.02(a).
"Federal Funds Rate" shall mean, for any day, the rate per
annum set forth in the weekly statistical release designated as
H.15(519), or any successor publication, published by the Federal
Reserve Board (including any such successor publication, "H.15 (519)")
for such day opposite the caption "Federal Funds (Effective)". If on
any relevant day, such rate is not yet published in H.15 (519), the
rate for such day shall be the rate set forth in the daily statistical
release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the
Federal Reserve Bank of New York (including any such successor
publication, the "Composite 3:30 p.m. Quotations") for such day under
the caption "Federal Funds Effective Rate". If on any relevant day,
such rate is not yet published in either H.15 (519) or the Composite
3:30 p.m. Quotations, the rate for such day shall be the arithmetic
mean, as determined by Agent, of the rates quoted to Agent for such day
by three (3) Federal funds brokers of recognized standing selected by
Agent for overnight federal funds transactions.
"Federal Reserve Board" shall mean the Board of Governors of
the Federal Reserve System of the United States of America.
"FIL" shall have the meaning given to that term in clause (1)
of the introductory paragraph hereof.
"Financial Statements" shall mean, with respect to any
accounting period for any Person, statements of income, shareholders'
equity and cash flows of such Person for such period, and a balance
sheet of such Person as of the end of such period, setting forth in
each case in comparative form figures for the corresponding period in
the preceding fiscal year if such period is less than a full fiscal
year or, if such
8
period is a full fiscal year, corresponding figures from the preceding
annual audit, all prepared in reasonable detail and in accordance with
GAAP.
"FIUI" shall mean Flextronics International USA, Inc., a
California corporation.
"FIUI Credit Agreement" shall mean the Credit Agreement dated
the date hereof among FIUI, as the borrower, each of the financial
institutions from time to time party thereto and ABN AMRO, as agent, as
amended or restated from time to time.
"FIUI Credit Documents" shall mean the FIUI Credit Agreement
and all agreements, documents and instruments delivered to the agent
under the FIUI Credit Agreement.
"Fixed Charge Coverage Ratio" shall mean, with respect to FIL
for any period, the ratio, determined on a consolidated basis in
accordance with GAAP, of:
(a) EBITDA for such period;
to
(b) The sum of (A) all Interest Expense of FIL
for such period plus (B) the current portion of the long-term
Indebtedness of FIL on the last day of such period (other than
Loans outstanding under this Agreement and loans outstanding
under the FIUI Credit Agreement) plus (C) for any period
ending on or after March 3, 2007, seventy-five percent (75%)
of the aggregate principal amount of (i) all Loans outstanding
under this Agreement and (ii) all loans outstanding under the
FIUI Credit Agreement;
minus
(ii) All interest income earned by FIL
during such period.
"Foreign Plan" shall mean any employee benefit plan maintained
by any Borrower or any of its Subsidiaries which is mandated or
governed by any Governmental Rule of any Governmental Authority other
than the United States.
"Foreign Subsidiary" shall mean any Subsidiary of FIL that is
organized under the laws of a jurisdiction other than the United States
or a state thereof.
"Fund" shall mean any Person (other than a natural person)
that is (or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its business.
"GAAP" shall mean generally accepted accounting principles and
practices as in effect in the United States of America from time to
time, consistently applied, subject to Paragraph 1.02 hereof.
"Governmental Authority" shall mean any domestic or foreign
national, state or local government, any political subdivision thereof,
any department, agency, authority or bureau of any of the foregoing, or
any other entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government,
including the Federal Deposit Insurance Corporation, the Federal
Reserve Board, the Comptroller of the Currency of the United States of
America, any central bank or any comparable authority.
"Governmental Charges" shall mean, with respect to any Person,
all levies, assessments, fees, claims or other charges imposed by any
Governmental Authority upon such Person or any of its property or
otherwise payable by such Person.
9
"Governmental Rule" shall mean any law, rule, regulation,
ordinance, order, code interpretation, judgment, decree, directive,
guidelines, policy or similar form of decision of any Governmental
Authority.
"Guarantor" shall mean each Eligible Material Subsidiary and
each other Subsidiary that has executed the Guaranty or otherwise
become a party thereto.
"Guaranty" shall have the meaning given to that term in
Subparagraph 2.15(a) hereof.
"Guaranty Obligation" shall mean, with respect to any Person,
subject to the last sentence of this definition, any direct or indirect
liability of that Person with respect to any indebtedness, lease,
dividend, letter of credit or other obligation (other than endorsements
of instruments for collection or deposits in the ordinary course of
business) (the "primary obligations") of another Person (the "primary
obligor"), including any obligation of that Person, whether or not
contingent, (a) to purchase, repurchase or otherwise acquire such
primary obligations or any property constituting direct or indirect
security therefor, (b) to advance or provide funds (i) for the payment
or discharge of any such primary obligation, or (ii) to maintain
working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency or any balance sheet item, level
of income or financial condition of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation or (d)
otherwise to assure or hold harmless the holder of any such primary
obligation against loss in respect thereof. The amount of any Guaranty
Obligation shall be deemed equal to the stated or determinable amount
of the primary obligation in respect of which such Guaranty Obligation
is made or, if not stated or if indeterminable, the maximum reasonably
anticipated liability in respect thereof (subject to reduction as the
underlying liability so guaranteed is reduced from time to time);
provided, however, that with respect to (1) any Guaranty Obligation by
FIL or any of its Subsidiaries in respect of a primary obligation of
FIL or any of its Subsidiaries and (2) any Guaranty Obligation of FIL
or any of its Subsidiaries in respect of the primary obligation of a
lessor in connection with a synthetic lease transaction entered into by
FIL or any of its Subsidiaries, such Guaranty Obligation shall, in each
case, be deemed to be equal to the maximum reasonably anticipated
liability in respect thereof which shall be deemed to be limited to an
amount that actually becomes past due from time to time with respect to
such primary obligation.
"Hazardous Materials" shall mean all pollutants, contaminants
and other materials, substances and wastes which are hazardous, toxic,
caustic, harmful or dangerous to human health or the environment,
including petroleum and petroleum products and byproducts, radioactive
materials, asbestos and polychlorinated biphenyls.
"Indebtedness" of any Person shall mean, without duplication,
the following (each, unless otherwise noted, determined in accordance
with GAAP):
(a) All obligations of such Person evidenced by
notes, bonds, debentures or other similar instruments and all
other obligations of such Person for borrowed money (including
obligations to repurchase receivables and other assets sold
with recourse);
(b) All obligations of such Person for the
deferred purchase price of property or services (including
obligations under letters of credit and other credit
facilities which secure or finance such purchase price, and
the capitalized amount reported for income tax purposes with
respect to obligations under "synthetic" leases but excluding
accounts payable for property or services or the deferred
purchase price of property to the extent due within one year);
(c) All obligations of such Person under
conditional sale or other title retention agreements with
respect to property (other than inventory) acquired by such
Person (to the extent of the value of such property if the
rights and remedies of the seller or lender under such
agreement in the event of default are limited solely to
repossession or sale of such property);
(d) All obligations of such Person as lessee
under or with respect to Capital Leases;
10
(e) All Guaranty Obligations of such Person with
respect to the Indebtedness of any other Person, and all other
Contingent Obligations of such Person; and
(f) All obligations of other Persons of the
types described in clauses (a) - (e) above to the extent
secured by (or for which any holder of such obligations has an
existing right, contingent or otherwise, to be secured by) any
Lien in any property (including accounts and contract rights)
of such Person, even though such Person has not assumed or
become liable for the payment of such obligations.
The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Ineligible Material Subsidiary" shall mean, at any time, any
Material Subsidiary (a) that is then prohibited by any applicable
Governmental Rule from acting as a Guarantor under the Guaranty, (b)
that then would incur, or would cause FIL to incur, a significant
increase in its tax liabilities or similar liabilities or obligations
as a result of acting as a Guarantor under the Guaranty or (c) that is
a Foreign Subsidiary as to which the representations and warranties set
forth in Subparagraph 4.01(s) would not be true and correct were it to
execute the Guaranty.
"Interest Expense" shall mean, with respect to any Person for
any period, the sum, determined on a consolidated basis in accordance
with GAAP, of (a) all interest expense of such Person during such
period (including interest attributable to Capital Leases) plus (b) all
fees in respect of outstanding letters of credit paid, accrued or
scheduled for payment by such Person during such period.
"Interest Period" shall mean, with respect to any LIBOR
Borrowing, the time period selected by the applicable Borrower pursuant
to Subparagraph 2.02(c) which commences on the date of such Borrowing
and ends on the last day of such time period, and thereafter, each
subsequent time period selected by the applicable Borrower pursuant to
Subparagraph 2.03(b)(ii).
"Investment" of any Person shall mean any loan or advance of
funds by such Person to any other Person (other than advances to
employees of such Person for moving and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business),
any purchase or other acquisition of any Equity Securities or
Indebtedness of any other Person, any capital contribution by such
Person to or any other investment by such Person in any other Person
(including any Guaranty Obligations of such Person and any indebtedness
of such Person of the type described in clause (f) of the definition of
"Indebtedness" on behalf of any other Person); provided, however, that
Investments shall not include (a) accounts receivable or other
indebtedness owed by customers of such Person which are current assets
and arose from sales of inventory in the ordinary course of such
Person's business or (b) prepaid expenses of such Person incurred and
prepaid in the ordinary course of business.
"IRC" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"Issuing Bank" shall have the meaning given to that term in
clause (9) of the introductory paragraph hereof.
"LC Application" shall have the meaning given to that term in
Subparagraph 2.01(b)(ii) hereof.
"LC Issuance Fees" shall have the meaning given to that term
in Subparagraph 2.06(c)(ii) hereof.
"LC Usage Fee Rate" shall mean with respect to any Letter of
Credit as of any date of determination, the per annum rate for Letters
of Credit determined pursuant to the Pricing Grid as such rate may
change as provided in the Pricing Grid.
11
"LC Usage Fees" shall have the meaning given to that term in
Subparagraph 2.06(c)(i) hereof.
"Lender" shall have the meaning given to that term in clause
(2) of the introductory paragraph hereof. Where the context so permits,
"Lenders" shall include the Issuing Bank and Lenders under the FIUI
Credit Agreement.
"Lender Rate Contract" shall mean any Rate Contract entered
into by any Borrower or any of FIL's Subsidiaries with a Lender or its
Affiliates with respect to Obligations arising under this Agreement.
"Lending Office" shall mean, with respect to any Lender and
any Borrowing, (a) initially, such Lender's office designated as such
in Part B of Schedule I (or, in the case of any Lender which becomes a
Lender by an assignment pursuant to Subparagraph 8.05(c), its office
designated as such in the applicable Assignment and Assumption) and (b)
subsequently, such other office or offices as such Lender may designate
to Agent as the office at which such Lender's Loans will thereafter be
maintained and for the account of which all payments of principal of,
and interest on, such Lender's Loans will thereafter be made.
"Letter of Credit" shall mean any standby letter of credit
(including any Existing Letter of Credit) issued pursuant to this
Agreement.
"LIBO Rate" shall mean, with respect to any Interest Period
for any LIBOR Borrowing, a rate per annum equal to the quotient
(rounded upward if necessary to the nearest 1/100 of one percent) of
(a) the arithmetic mean of the rates per annum appearing on the
Applicable Rate Page for the Currency of such Borrowing on the second
Business Day prior to the first day of such Interest Period at or about
11:00 A.M. (London time) (for delivery of such Currency on the first
day of such Interest Period) for a term comparable to such Interest
Period, divided by (b) one minus any applicable Reserve Requirement in
effect from time to time. If for any reason rates are not available as
provided in clause (a) of the preceding sentence, the rate to be used
in clause (a) shall be, at the Agent's discretion, (i) the rate per
annum at which deposits in the applicable Currency are offered to Agent
in the London interbank market or (ii) the rate at which deposits in
the applicable Currency are offered to Agent in, or by Agent to major
banks in, any offshore interbank market selected by Agent, in each case
on the second Business Day prior to the commencement of such Interest
Period at or about 10:00 A.M. (New York City time) (for delivery on the
first day of such Interest Period) for a term comparable to such
Interest Period and in an amount approximately equal to the amount of
the Loan to be made or funded by Agent as part of such Borrowing. The
LIBO Rate shall be adjusted automatically as to all LIBOR Loans
outstanding as of the effective date of any change in the Reserve
Requirement.
"LIBOR Borrowing" shall mean any Borrowing consisting of LIBOR
Loans.
"LIBOR Loan" shall mean any Loan bearing interest based upon
the LIBO Rate.
"Lien" shall mean, with respect to any property or asset, (a)
any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance,
charge or security interest in, on or of such property or asset or the
income therefrom, including any agreement to provide any of the
foregoing, (b) the interest of a vendor or a lessor under any
conditional sale agreement, Capital Lease or title retention agreement
(or any financing lease having substantially the same economic effect
as any of the foregoing) relating to such asset and (c) in the case of
securities, any purchase option, call or similar right of a third party
with respect to such securities.
"Loan" shall have the meaning given to that term in
Subparagraph 2.01(a)(i) hereof.
"Loan Account" shall have the meaning given to that term in
Subparagraph 2.09(a) hereof.
"Managing Agents" shall have the meaning given to that term in
clause (7) of the introductory paragraph hereof.
12
"Margin Stock" shall have the meaning given to that term in
Regulation U issued by the Federal Reserve Board.
"Material Adverse Effect" shall mean a material adverse effect
on (a) the business, assets, operations or financial condition of any
Borrower and FIL's Subsidiaries, taken as a whole, (b) the ability of
any Borrower to pay or perform its Obligations in accordance with the
terms of this Agreement and the other Credit Documents, (c) the ability
of the Guarantors (taken as a whole) to pay or perform the Obligations
in accordance with the terms of this Agreement and the other Credit
Documents or (d) the rights and remedies of Agent or any Lender under
this Agreement, the other Credit Documents or any related document,
instrument or agreement.
"Material Subsidiary" shall mean, at any time during any
fiscal year of FIL, (a) any Subsidiary of FIL that (i) had revenues
during the immediately preceding fiscal year equal to or greater than
five percent (5%) of the consolidated total revenues of FIL during such
preceding year or (ii) held assets, excluding investments in
Subsidiaries, on the last day of the immediately preceding fiscal year
equal to or greater than ten percent (10%) of the consolidated total
assets of FIL on such date, in each case as set forth or reflected in
the audited Financial Statements provided pursuant to Subparagraph
5.01(a)(ii) hereof, (b) with respect to any Subsidiary of FIL added or
created during such year, (i) any Subsidiary of FIL that had revenues,
determined on a pro forma basis as of the most recent twelve months for
which financial statements are available, greater than five percent
(5%) of the consolidated total revenues of FIL during such preceding
year or (ii) held assets, excluding investments in Subsidiaries,
determined on a pro forma basis on the last day of the immediately
preceding month equal to or greater than ten percent (10%) of the
consolidated total assets of FIL (including the assets of such added or
created Subsidiary or Subsidiaries) on such date.
"maturity" shall mean, with respect to any Loan, Reimbursement
Obligation, interest, fee or other amount payable by any Borrower under
this Agreement or the other Credit Documents, the date such Loan,
Reimbursement Obligation, interest, fee or other amount becomes due,
whether upon the stated maturity or due date, upon acceleration or
otherwise.
"Maturity Date" shall mean March 3, 2008.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. and any
successor thereto that is a nationally recognized rating agency.
"Multiemployer Plan" shall mean any multiemployer plan within
the meaning of section 3(37) of ERISA maintained or contributed to by
any Borrower, any Material Subsidiary or any ERISA Affiliate.
"Net Proceeds" shall mean, with respect to any issuance and
sale of securities by any Person (a) the aggregate cash proceeds
received by such Person from such sale less (b) the sum of (i) the
actual amount of the reasonable fees and commissions payable to Persons
other than such Person making the sale or any Affiliate of such Person
and (ii) the reasonable legal expenses and other costs and expenses
directly related to such sale that are to be paid by such Person.
"New Program Acquisition" shall mean a transaction or series
of related transactions in which FIL or any of its Subsidiaries
acquires assets from any other Person and also enters into an agreement
to manufacture products for such Person (or an Affiliate thereof).
"Non-Excluded Taxes" shall mean all Taxes other than Excluded
Taxes.
"Nortel" shall mean Nortel Networks Corporation and any of its
Subsidiaries or Affiliates.
"Nortel Closing Date" shall mean the date that is the earliest
date on which FIL or any of its Subsidiaries consummate a transaction
or series of related transactions in which FIL or such Subsidiary (i)
acquires any assets of Nortel for an aggregate principal amount of more
than Ten Million Dollars ($10,000,000) and (ii) enters into an
agreement with Nortel to manufacture Nortel products.
13
"Note" shall have the meaning given to that term in
Subparagraph 2.09(b) hereof.
"Notice of Borrowing" shall have the meaning given to that
term in Paragraph 2.02 hereof.
"Notice of Interest Period Selection" shall have the meaning
given to that term in Subparagraph 2.03(b)(ii).
"Obligations" shall mean and include all loans, advances,
debts, liabilities, and obligations, howsoever arising, owed by any
Borrower individually or all Borrowers jointly and severally to Agent
or any Lender of every kind and description (whether or not evidenced
by any note or instrument and whether or not for the payment of money),
direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising pursuant to the terms of this Agreement
or any of the other Credit Documents, including all interest, fees,
charges, expenses, attorneys' fees and accountants' fees chargeable to
Borrowers or payable by Borrowers thereunder.
"Overnight Rate" shall mean, for any amount payable in an
Alternative Currency on any day, the per annum interest rate at which
overnight deposits in such Alternative Currency in an amount
approximately equal to such amount would be offered for such day by ABN
AMRO's London Office to major banks in the London interbank market.
"Participant" shall have the meaning given to that term in
Subparagraph 8.05(b) hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Indebtedness" shall have the meaning given to that
term in Subparagraph 5.02(a) hereof.
"Permitted Liens" shall have the meaning given to that term in
Subparagraph 5.02(b) hereof.
"Person" shall mean and include an individual, a partnership,
a corporation (including a business trust), a joint stock company, an
unincorporated association, a limited liability company, a joint
venture, a trust or other entity or a Governmental Authority.
"Pricing Grid" shall mean the pricing grid set forth on
Schedule II and the accompanying explanation thereto.
"Pricing Level" shall mean either Xxxxx 0, Xxxxx 0, Xxxxx 0,
Xxxxx 4 or Level 5, which shall be determined as set forth in the
Pricing Grid as such Pricing Levels may change as provided in the
Pricing Grid.
"Prime Rate" shall mean the per annum rate publicly announced
by ABN AMRO from time to time at its Chicago office as its "prime
rate." The Prime Rate is determined by ABN AMRO from time to time as a
means of pricing credit extensions to some customers and is neither
directly tied to any external rate of interest or index nor necessarily
the lowest rate of interest charged by ABN AMRO at any given time for
any particular class of customers or credit extensions. Any change in
the Base Rate resulting from a change in the Prime Rate shall become
effective on the Business Day on which each change in the Prime Rate is
announced as being effective.
"Proportionate Share" shall mean:
(a) With respect to any Lender at any time prior
to the termination of the Commitments, the ratio (expressed as
a percentage rounded to the eighth digit to the right of the
decimal point) of (i) such Lender's Commitments at such time
to (ii) the Total Commitment at such time; and
14
(b) With respect to any Lender at any time after
the termination of the Commitments, the ratio (expressed as a
percentage rounded to the eighth digit to the right of the
decimal point) of (i) the sum at such time of (A) the
aggregate principal amount of all Loans owed to such Lender
and outstanding at such time, (B) such Lender's pro rata share
of the aggregate amount available for drawing under all
Letters of Credit outstanding at such time and (c) such
Lender's pro rata share of the aggregate amount of all
Reimbursement Obligations outstanding at such time to (ii) the
sum at such time of (A) the aggregate principal amount of all
Loans outstanding at such time, (B) the aggregate amount
available for drawing under all Letters of Credit outstanding
at such time and (C) the aggregate amount of all Reimbursement
Obligations outstanding at such time.
"Rate Contracts" shall mean any agreement with respect to any
swap, forward, future or derivative transaction or option or similar
agreement involving, or settled by reference to, one or more rates,
currencies, commodities, equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic,
financial or pricing risk or value or any similar transaction or any
combination of these transactions, provided that no phantom stock or
similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or
consultants of any Borrower or its Subsidiaries shall be a Rate
Contract.
"Register" shall have the meaning given to that term in
Subparagraph 8.05(d) hereof.
"Reimbursement Obligation" shall have the meaning given to
that term in Subparagraph 2.01(b)(iii)(C) hereof.
"Reimbursement Payment" shall have the meaning given to that
term in Subparagraph 2.01(b)(iii)(B) hereof.
"Reportable Event" shall have the meaning given to that term
in ERISA and applicable regulations thereunder.
"Required Lenders" shall mean, at any time, Lenders whose
Proportionate Shares equal or exceed fifty-one percent (51%) at such
time, except at any time any Lender is a Defaulting Lender. (For the
purposes of determining "Required Lenders" at any time any Lender is a
Defaulting Lender, the "Proportionate Shares" of non-defaulting Lenders
shall be determined excluding from the Commitment the aggregate amounts
of the Defaulting Lenders' Commitments, and "Required Lenders" shall
mean non-defaulting Lenders whose Proportionate Shares as so determined
then equal or exceed fifty-one percent (51%).)
"Requirement of Law" applicable to any Person shall mean (a)
the Articles or Certificate of Incorporation and By-laws, Partnership
Agreement or other organizational or governing documents of such
Person, (b) any Governmental Rule applicable to such Person, (c) any
license, permit, approval or other authorization granted by any
Governmental Authority to or for the benefit of such Person or (d) any
judgment, decision or determination of any Governmental Authority or
arbitrator, in each case applicable to or binding upon such Person or
any of its property or to which such Person or any of its property is
subject.
"Reserve Requirement" shall mean (a) with respect to any day
in an Interest Period for any portion of a Borrowing in Dollars, the
aggregate of the reserve requirement rates, if any (expressed as a
decimal), in effect on such day for funding in Dollars maintained by
commercial banks in the United States, (b) with respect to any day in
an Interest Period for any portion of a Borrowing in United Kingdom
pounds, the aggregate of the reserve requirement rates, if any
(expressed as a decimal), in effect on such day for funding in United
Kingdom pounds maintained by commercial banks which lend in United
Kingdom pounds, or (c) with respect to any day in an Interest Period
for any portion of a Borrowing in Euros, the aggregate of the reserve
requirement rates, if any (expressed as a decimal), in effect on such
day for funding in Euros maintained by commercial banks which lend in
Euros. As used herein, the term "reserve requirement" shall include any
basic, supplemental or emergency reserve requirements imposed on any
Lender by any Governmental Authority.
15
"Responsible Officer" shall mean, with respect to any
Borrower, such Borrower's Chief Executive Officer, Chief Financial
Officer, Treasurer, Vice President - Finance, Controller, Assistant
Treasurer, Director of Treasury Operations, Corporate Secretary or any
other officer of any Borrower designated from time to time by its Board
of Directors to execute and deliver any document, instrument or
agreement hereunder.
"S&P" shall mean Standard & Poor's Rating Services, and any
successor thereto that is a nationally recognized rating agency.
"Security Documents" shall mean and include (i) the Guaranty
and (ii) all other instruments, agreements, certificates, opinions and
documents delivered to Agent or the Issuing Bank to secure the
Obligations.
"Senior Debt Rating" shall mean with respect to FIL as of any
date of determination, (i) the "Senior Implied Rating" of Moody's and
(ii) the "Corporate Credit Rating" of S&P.
"Senior Managing Agent" shall have the meaning given to that
term in clause (6) of the introductory paragraph hereof.
"Significant Subsidiary" shall mean, at any time during any
fiscal year of FIL, (a) any Subsidiary of FIL that (i) had revenues
during the immediately preceding fiscal year equal to or greater than
Ten Million Dollars ($10,000,000) or (ii) had net worth on the last day
of the immediately preceding fiscal year equal to or greater than Ten
Million Dollars ($10,000,000).
"Solvent" shall mean, with respect to any Person on any date,
that on such date (a) the fair value of the property of such Person is
greater than the fair value of the liabilities (including contingent,
subordinated, matured and unliquidated liabilities) of such Person, (b)
such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay as such
debts and liabilities mature and (c) such Person is not engaged in or
about to engage in business or transactions for which such Person's
property would constitute an unreasonably small capital.
"Subordinated Indebtedness" shall mean Indebtedness of any
Borrower or any Subsidiary of a Borrower that is subordinated to the
Obligations.
"Subordinated Indenture" shall mean, collectively, (a) the
Indenture dated as of October 15, 1997 by and between FIL and State
Street Bank and Trust Company of California, N.A., with respect to up
to $150,000,000 of 8 3/4% Senior Subordinated Notes due 2007, (b) the
Indenture dated as of June 29, 2000 by and between FIL and Chase
Manhattan Bank and Trust Company, National Association with respect to
up to $1,000,000,000 of 9 7/8% Senior Subordinated Notes due 2010, (c)
the Indenture dated as of June 29, 2000 by and between FIL and Chase
Manhattan Bank and Trust Company, National Association with respect to
up to (euro) 300,000,000 of 9 3/4% Senior Subordinated Notes due 2010,
(d) the Indenture dated as of May 9, 2003 by and between FIL and
JPMorgan Trust Company, National Association with respect to up to
$400,000,000 of 6 1/2% Senior Subordinated Notes due 2013, (e) the
Indenture dated as of August 5, 2003 by and between FIL and JPMorgan
Trust Company, National Association with respect to up to $500,000,000
of 1% Convertible Subordinated Notes due 2010 and (f) any other
document, instrument or agreement evidencing Subordinated Indebtedness.
"Subsidiary" of any Person shall mean (a) any corporation of
which more than 50% of the issued and outstanding Equity Securities
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
or might have voting power upon the occurrence of any contingency) is
at the time directly or indirectly owned or controlled by such Person,
by such Person and one or more of its other Subsidiaries or by one or
more of such Person's other Subsidiaries, (b) any partnership, joint
venture, limited liability company or other association of which more
than 50% of the equity interest having the power to vote, direct or
control the management of such partnership, joint venture or other
association is at
16
the time owned and controlled by such Person, by such Person and one or
more of the other Subsidiaries or by one or more of such Person's other
Subsidiaries or (c) any other Person included in the Financial
Statements of such Person on a consolidated basis. (All references in
this Agreement and the other Credit Documents to Subsidiaries of FIL
shall, unless otherwise indicated, include any of the other Borrowers
and their Subsidiaries.)
"Surety Instruments" shall mean all letters of credit
(including standby and commercial), banker's acceptances, bank
guaranties, shipside bonds, surety bonds and similar instruments.
"Taxes" shall mean all present and future income, stamp,
documentary and other taxes and duties, and all other levies, imposts,
charges, fees, deductions and withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority.
"Total Assets" shall mean with respect to any date of
determination, the total assets of FIL shown on FIL's consolidated
balance sheet in accordance with GAAP on the last day of the fiscal
quarter prior to the date of determination.
"Total Commitment" shall mean, at any time, the sum at such
time of Lenders' Commitments. The Total Commitment on the date of this
Agreement is Five Hundred Fifty Million Dollars ($550,000,000.00).
"Type" shall mean, with respect to any Loan or any Borrowing
at any time, the classification of such Loan or Borrowing by the type
of interest rate it then bears, whether an interest rate based upon the
Base Rate or LIBO Rate.
"Unused" shall mean:
(a) With respect to the Total Commitment at any
time, the remainder of (i) the Total Commitment at such time
minus (ii) the sum of the Dollar amount or Dollar Equivalent
(as applicable) of (A) the aggregate principal amount of all
Loans outstanding at such time, (B) the aggregate amount
available for drawing under all Letters of Credit outstanding
at such time and (C) the aggregate amount of all Reimbursement
Obligations outstanding at such time (the sum of clause (ii)
being referred to as the "Used Commitment");
(b) With respect to the Combined Total
Commitment at any time, the remainder of (i) the Combined
Total Commitment at such time minus (ii) the sum of (A) the
Used Commitment (as determined pursuant to clause (a) above)
and (B) the "Used Commitment" as defined in the FIUI Credit
Agreement.
"Used Commitment" shall have the meaning given to that term in
clause (a) of the definition of "Unused" in Paragraph 1.01 hereof.
"Wholly-Owned Subsidiary" shall mean any Subsidiary of which
more than 90% of the issued and outstanding Equity Interests are owned,
directly or indirectly, by FIL.
1.02. GAAP. Unless otherwise indicated in this Agreement or any
other Credit Document, all accounting terms used in this Agreement or any other
Credit Document shall be construed, and all accounting and financial
computations hereunder or thereunder shall be computed, in accordance with GAAP.
If GAAP changes during the term of this Agreement such that any covenants
contained herein would then be calculated in a different manner or with
different components, Borrowers, Lenders and Agent agree to negotiate in good
faith to amend this Agreement in such respects as are necessary to conform those
covenants as criteria for evaluating Borrower's financial condition to
substantially the same criteria as were effective prior to such change in GAAP;
provided, however, that, until Borrowers, Lenders and Agent so amend this
Agreement, all such covenants shall be calculated in accordance with GAAP as in
effect immediately prior to such change.
17
1.03. Headings. Headings in this Agreement and each of the other
Credit Documents are for convenience of reference only and are not part of the
substance hereof or thereof.
1.04. Plural Terms. All terms defined in this Agreement or any other
Credit Document in the singular form shall have comparable meanings when used in
the plural form and vice versa.
1.05. Governing Law. Unless otherwise expressly provided in any
Credit Document, this Agreement and each of the other Credit Documents shall be
governed by and construed in accordance with the laws of the State of New York.
1.06. English Language. This Agreement and the other Credit
Documents are executed and shall be construed in the English language. All
instruments, agreements, certificates, opinions and other documents to be
furnished or communications to be given or made under this Agreement or any
other Credit Document shall be in the English language.
1.07. Construction. This Agreement is the result of negotiations
among, and has been reviewed by, Borrowers, each Lender, Agent and their
respective counsel. Accordingly, this Agreement shall be deemed to be the
product of all parties hereto, and no ambiguity shall be construed in favor of
or against any Borrower, any Lender or Agent.
1.08. Entire Agreement. This Agreement and each of the other Credit
Documents, taken together, constitute and contain the entire agreement of
Borrowers, Lenders and Agent and supersede any and all prior agreements,
negotiations, correspondence, understandings and communications among the
parties, whether written or oral, respecting the subject matter hereof
(excluding the Agent's Fee Letter and the reimbursement and indemnification
obligations in the Commitment Letter).
1.09. Calculation of Interest and Fees. All calculations of interest
and fees under this Agreement and the other Credit Documents for any period (a)
shall include the first day of such period and exclude the last day of such
period and (b) shall be calculated on the basis of a year of 360 days for actual
days elapsed, except that during any period any Loan bears interest based upon
the Prime Rate, such interest shall be calculated on the basis of a year of 365
or 366 days, as appropriate, for actual days elapsed.
1.10. References.
(a) References in this Agreement to "Recitals,"
"Sections," "Paragraphs," "Subparagraphs," "Exhibits" and "Schedules"
are to recitals, sections, paragraphs, subparagraphs, exhibits and
schedules in and to this Agreement unless otherwise indicated.
(b) References in this Agreement or any other Credit
Document to any document, instrument or agreement (i) shall include all
exhibits, schedules and other attachments thereto, (ii) shall include
all documents, instruments or agreements issued or executed in
replacement thereof if such replacement is permitted hereby, and (iii)
shall mean such document, instrument or agreement, or replacement or
predecessor thereto, as amended, modified and supplemented from time to
time and in effect at any given time if such amendment, modification or
supplement is permitted hereby.
(c) References in this Agreement or any other Credit
Document to any Governmental Rule (i) shall include any successor
Governmental Rule, (ii) shall include all rules and regulations
promulgated under such Governmental Rule (or any successor Governmental
Rule), and (iii) shall mean such Governmental Rule (or successor
Governmental Rule) and such rules and regulations, as amended,
modified, codified or reenacted from time to time and in effect at any
given time.
18
(d) References in this Agreement or any other Credit
Document to any Person in a particular capacity (i) shall include any
permitted successors to and assigns of such Person in that capacity and
(ii) shall exclude such Person individually or in any other capacity.
1.11. Other Interpretive Provisions. The words "hereof," "herein"
and "hereunder" and words of similar import when used in this Agreement or any
other Credit Document shall refer to this Agreement or such other Credit
Document, as the case may be, as a whole and not to any particular provision of
this Agreement or such other Credit Document, as the case may be. The words
"include" and "including" and words of similar import when used in this
Agreement or any other Credit Document shall not be construed to be limiting or
exclusive. In the event of any inconsistency between the terms of this Agreement
and the terms of any other Credit Document, the terms of this Agreement shall
govern.
SECTION II. CREDIT FACILITIES.
2.01. Loans and Letters of Credit.
(a) Loans.
(i) Availability. Subject to the terms and
conditions of this Agreement (including the amount limitations
set forth in Paragraph 2.05), each Lender severally agrees to
advance to Borrowers from time to time during the period from
and including the Closing Date to but excluding the Maturity
Date its pro rata share of such revolving loans in Currencies
as Borrowers may request (individually, a "Loan"); provided,
however, that no Lender shall have any obligation to make a
requested Loan if, after giving effect to such Loan, the
Dollar amount or Dollar Equivalent (as applicable) on the date
such Loan is to be made of (i) such Lender's Loans then
outstanding plus (ii) such Lender's Proportionate Share of the
aggregate amount available for drawing under all Letters of
Credit outstanding at such time plus (iii) such Lender's
Proportionate Share of the aggregate amount of all
Reimbursement Obligations outstanding at such time would
exceed such Lender's Commitment at such time. The failure of
any Lender to make any Loan required to be made by it shall
not relieve any other Lender of its obligations hereunder. The
Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as
required. All Loans shall be made on a pro rata basis by
Lenders in accordance with their respective Proportionate
Shares, with each Borrowing to be comprised of a Loan made by
each Lender equal to such Lender's Proportionate Share of such
Borrowing. Except as otherwise provided herein, Borrowers may
borrow, repay and reborrow Loans until the Maturity Date.
(ii) Scheduled Payments. Borrowers shall repay
the principal amount of the Loans in full on the Maturity
Date. Borrowers shall pay accrued interest on the unpaid
principal amount of each Loan in arrears (A) in the case of a
Base Rate Loan, on the last Business Day of the month of each
March, June, September and December, (B) in the case of a
LIBOR Loan, on the last day of each Interest Period therefor
(and, if any such Interest Period is equal to or longer than
three (3) months, every three (3) months), and (C) in the case
of all Loans, upon prepayment (to the extent thereof) and at
maturity.
(b) Letter of Credit Subfacility.
(i) Availability. Upon the satisfaction (or
waiver in accordance with Paragraph 8.04) of the conditions
specified in Paragraph 3.01 on the Closing Date, each Existing
Letter of Credit will automatically, without any action on the
part of any Person, be deemed to be a Letter of Credit issued
hereunder for the account of the applicable Borrower for all
purposes of this Agreement and the other Credit Documents. In
addition, subject to the terms and conditions of this
Agreement (including the amount limitations set forth in
Paragraph 2.05), Issuing Bank agrees to issue on behalf of
Borrowers from time to time during the period beginning on the
Closing Date
19
and ending on the date that is thirty (30) days prior to the
Maturity Date such Letters of Credit as any Borrower may
request under this Subparagraph 2.01(b); provided, however, as
follows:
(A) The aggregate amount available for
drawing under all Letters of Credit at any time
outstanding shall not exceed the Dollar amount or
Dollar Equivalent (as applicable) of One Hundred
Twenty-Five Million Dollars ($125,000,000);
(B) Each Letter of Credit shall be an
irrevocable standby letter of credit in Dollars or an
Alternative Currency;
(C) Each Letter of Credit shall expire
on or prior to the date that is one year after the
date of its issuance; provided, however, that in no
event shall any Letter of Credit, including any
Existing Letter of Credit, expire later than the date
that is thirty (30) days prior to the Maturity Date);
and
(D) Each Letter of Credit shall be in a
form reasonably acceptable to Issuing Bank.
Except as otherwise provided herein, Borrowers may request
Letters of Credit, cause or allow Letters of Credit to expire
and request additional Letters of Credit until the date thirty
(30) days prior to the Maturity Date.
(ii) LC Application. Borrowers shall request each
Letter of Credit by delivering to Agent and Issuing Bank an
irrevocable written application in a form reasonably
acceptable to Issuing Bank, appropriately completed (an "LC
Application"), which specifies, among other things:
(A) The available amount of the
requested Letter of Credit (which amount available
(1) shall be equal to the maximum amount which may
over time be drawn under the Letter of Credit and (2)
shall not be less than One Million Dollars
($1,000,000) (or the Dollar Equivalent thereof)), and
the Currency of such requested Letter of Credit;
(B) The name and address of the
beneficiary of the requested Letter of Credit;
(C) The expiration date of the
requested Letter of Credit;
(D) The documentary conditions for
drawing under the requested Letter of Credit;
(E) The date of issuance for the
requested Letter of Credit, which shall be a Business
Day; and
(F) The applicable Borrower for such
Letter of Credit.
The applicable Borrower shall give each LC Application to
Issuing Bank at least two (2) Business Days before the
proposed date of issuance of the requested Letter of Credit.
Each LC Application shall be delivered by first-class mail or
facsimile to Agent and Issuing Bank at their respective
offices or facsimile numbers and during the hours specified in
Paragraph 8.01; provided, however, that the applicable
Borrower shall promptly deliver to Issuing Bank the original
of any LC Application initially delivered by facsimile. Agent
shall promptly notify each Lender of the contents of each LC
Application. In the event of any conflict between the terms of
this Agreement and the terms of any LC Application or any
agreement (other than any Letter of Credit) related
20
thereto (including terms with respect to fees and covenants),
the terms of this Agreement shall control.
(iii) Disbursement and Reimbursement.
(A) Disbursement. Issuing Bank shall
notify the requesting Borrower promptly upon receipt
by Issuing Bank of the presentment of any demand for
payment under any Letter of Credit, together with
notice of the amount of such payment and the date
such payment is to be made. Subject to the terms and
provisions of such Letter of Credit and applicable
law, Issuing Bank shall make such payment (a "Drawing
Payment") to the appropriate beneficiary. Upon
payment by Issuing Bank of each Drawing Payment, the
remaining available amount under such Letter of
Credit (if any) shall be reduced by the amount of
such payment.
(B) Time of Reimbursement. On the day
each Drawing Payment is to be made by Issuing Bank,
Borrowers shall make or cause to be made to Issuing
Bank a payment in the amount of such Drawing Payment
(a "Reimbursement Payment"); provided, however, that
if the requesting Borrower does not receive notice
from Issuing Bank by 10:00 a.m. (California time)
that a Reimbursement Payment is due, such
Reimbursement Payment (together with interest thereon
accruing at the Federal Funds Rate from and including
the date such Drawing Payment is made but excluding
the next succeeding Business Day) shall instead be
due on the next succeeding Business Day after the
requesting Borrower receives such notice, provided
that Borrowers shall make such Reimbursement Payment
to, or cause such Reimbursement Payment to be made
to, Agent for the benefit of the Lenders if, prior to
the time such Reimbursement Payment is made, Issuing
Bank has notified the applicable Borrower that it has
requested the Lenders pursuant to Subparagraph
2.01(b)(iv) to pay to Issuing Bank their respective
Proportionate Shares of the Drawing Payment made by
Issuing Bank. If any such Reimbursement Payment is
made to Agent, Agent shall promptly pay to each
Lender which has paid its Proportionate Share of the
Drawing Payment, such Lender's Proportionate Share of
the Reimbursement Payment and shall promptly pay to
Issuing Bank the balance of such Reimbursement
Payment.
(C) Reimbursement Obligation Absolute.
The obligation of Borrowers to reimburse Issuing Bank
or the Lenders, as the case may be, for Drawing
Payments (such obligation, together with the
obligation to pay interest thereon, to be referred to
herein collectively as a "Reimbursement Obligation")
shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the
terms of this Agreement under and without regard to
any circumstances, including, (1) the passage of the
Maturity Date, (2) any lack of validity or
enforceability of any of the Credit Documents, (3)
the existence of any claim, set-off, defense or other
right which Borrowers may have at any time against
any beneficiary or any transferee of any Letter of
Credit (or any Persons for whom any such beneficiary
or transferee may be acting), Issuing Bank, Agent,
any other Lender or any other Person, whether in
connection with this Agreement, the transactions
contemplated herein or in the other Credit Documents,
or in any unrelated transaction, (4) any breach of
contract or dispute between Borrowers, any
beneficiary or any transferee of any Letter of Credit
(or any Persons for whom any such beneficiary or
transferee may be acting), Issuing Bank, any Agent,
any Lender or any other Person, (5) any demand,
statement or other document presented under any
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, (6) payment by Issuing Bank under any Letter
of Credit against presentation of a demand for
payment which does not comply with the terms of such
Letter of Credit, (7) any non-application or
misapplication by any beneficiary or any transferee
of any Letter of Credit (or any Persons for whom any
such beneficiary or transferee may be acting) of the
proceeds of
21
any drawing under such Letter of Credit, (8) any
delay, extension of time, renewal, compromise or
other indulgence or modification granted or agreed to
by Issuing Bank, Agent or any Lender, with or without
notice to or approval by Borrowers, with respect to
Borrowers' indebtedness under this Agreement or (9)
any other act or omission to act or delay of any kind
of the Issuing Bank, Agent, any Lender or any other
person, in any other event or circumstance
whatsoever, whether or not similar to any of the
foregoing that might, but for the provisions of this
Subparagraph 2.01(b)(iii)(C), constitute a legal or
equitable discharge of, or provide a right of set-off
against, Borrowers' respective obligations hereunder;
provided, however, that this Subparagraph
2.01(b)(iii)(C) shall not abrogate any right which
Borrowers may have to seek to enjoin any drawing
under any Letter of Credit or to recover damages from
Issuing Bank pursuant to Subparagraph 2.01(c)(v).
(iv) Lender Participations; Loan Funding.
(A) Participation Agreement. Each
Lender severally, unconditionally and irrevocably
agrees with Issuing Bank to participate in the
extension of credit arising from the issuance of each
Letter of Credit in an amount equal to such Lender's
Proportionate Share of the stated amount of such
Letter of Credit from time to time, and the issuance
of each Letter of Credit shall be deemed a
confirmation by Issuing Bank of such participation in
such amount.
(B) Participation Funding. Issuing Bank
may request the Lenders to fund their participations
in Letters of Credit by paying to Issuing Bank all or
any portion of any Drawing Payment made or to be made
by Issuing Bank under any Letter of Credit. Issuing
Bank shall make such a request by delivering to Agent
(with a copy to Borrowers), at any time after the
drawing for which such payment is requested has been
made upon Issuing Bank, a written request for such
payment which specifies the amount of such Drawing
Payment and the date on which such Drawing Payment is
to be made or was made; provided, however, that
Issuing Bank shall not request the Lenders to make
any payment under this Subparagraph 2.01(b)(iv) in
connection with any portion of a Drawing Payment for
which Issuing Bank has been reimbursed in full from a
Reimbursement Payment by Borrowers unless such
Reimbursement Payment has been thereafter recovered
by Borrowers or any other Person. Agent shall
promptly notify each Lender of the contents of each
such request and of such Lender's Proportionate Share
of the applicable portion of such Drawing Payment.
Promptly following receipt of such notice from Agent,
each Lender shall pay to Agent, for the benefit of
Issuing Bank, such Lender's Proportionate Share of
the applicable portion of such Drawing Payment.
(C) Funding Through Loans. If, at any
time prior to the Maturity Date, any Reimbursement
Obligations are outstanding, Agent may or, upon the
written request of Issuing Bank (if one or more
Borrower is not then the subject of a bankruptcy
proceeding), shall (subject to the terms and
conditions of this Subparagraph 2.01(b)(iv)),
initiate a Borrowing in an amount not exceeding the
aggregate amount of such outstanding Reimbursement
Obligations and use the proceeds of such Borrowing to
repay all or a portion of such Reimbursement
Obligations. Agent shall initiate such a Borrowing by
delivering to each Lender (with a copy to the
applicable Borrower) a written notice which specifies
the aggregate amount of outstanding Reimbursement
Obligations, the amount of the Borrowing (which
initially shall consist of Base Rate Loans), the date
of such Borrowing and the amount of the Loan to be
made by such Lender as part of such Borrowing. Each
Lender shall make available to Agent funds in the
amount of its Loan as provided in Subparagraph
2.10(a). After receipt of such funds, Agent shall
promptly disburse such funds to Issuing Bank and the
Lenders, as appropriate, in payment of the
outstanding Reimbursement Obligations.
22
(D) Obligations Absolute. Each Lender's
obligations to fund its participations under this
Subparagraph 2.01(b)(iv) shall be absolute,
unconditional and irrevocable and shall not be
affected by (1) the passage of the Maturity Date, (2)
the occurrence or existence of any Default, (3) any
failure to satisfy any condition set forth in Section
III, (4) any event or condition which might have a
Material Adverse Effect, (5) the failure of any other
Lender to make any payment under this Subparagraph
2.01(b)(iv), (6) any right of offset, abatement,
withholding or reduction which such Lender may have
against Issuing Bank, Agent, any Lender or any
Borrower, (7) any event, circumstance or condition
set forth in Subparagraph 2.01(b)(iii) or
Subparagraph 2.01(b)(v), or (8) any other event,
circumstance or condition whatsoever, whether or not
similar to any of the foregoing; provided, however,
that nothing in this Subparagraph 2.01(b)(iv) shall
prejudice any right which any Lender may have against
Issuing Bank for any action by Issuing Bank which
constitutes gross negligence or willful misconduct.
(v) Liability of Issuing Bank, Etc. Provided
that Issuing Bank has used reasonable care in examining all
documents presented to it in connection with a demand on any
Letter of Credit, Borrowers agree that none of Issuing Bank,
Agent or any Lender (nor any of their respective directors,
officers or employees) shall be liable or responsible for (A)
the use which may be made of any Letter of Credit or for any
acts or omissions of any beneficiary or transferee thereof in
connection therewith; (B) any reference which may be made to
this Agreement or to any Letter of Credit in any agreements,
instruments or other documents relating to obligations secured
by such Letter of Credit; (C) the validity, sufficiency or
genuineness of documents, or of any endorsement(s) thereon,
even if such documents should in fact prove to be in any or
all respects invalid, insufficient, fraudulent or forged or
any statement therein prove to be untrue or inaccurate in any
respect whatsoever; (D) payment by Issuing Bank against
presentation of documents which do not comply with the terms
of any Letter of Credit, including failure of any documents to
bear any reference or adequate reference to any Letter of
Credit; or (E) any other circumstances whatsoever in making or
failing to make payment under any Letter of Credit, except
only that Issuing Bank shall be liable to Borrowers for acts
or events described in clauses (A) through (E) above, to the
extent, but only to the extent, of any damages suffered by
Borrowers (excluding consequential damages) which Borrowers
prove were caused by (1) Issuing Bank's willful misconduct or
gross negligence in determining whether a drawing made under
any Letter of Credit complies with the terms and conditions
therefor stated in such Letter of Credit or (2) Issuing Bank's
willful misconduct or gross negligence in failing to pay under
any Letter of Credit after a drawing by the beneficiary
thereof strictly complying with the terms and conditions of
such Letter of Credit. Without limiting the foregoing, Issuing
Bank may accept a drawing that appears on its face to be in
order, without responsibility for further investigation. The
determination of whether a drawing has been made under any
Letter of Credit prior to its expiration or whether a drawing
made under any Letter of Credit is in proper and sufficient
form shall be made by Issuing Bank in its sole discretion,
which determination shall be conclusive and binding upon
Borrowers to the extent permitted by law. The parties hereto
expressly agree that, in the absence of willful misconduct or
gross negligence by the Issuing Bank (as finally determined by
a court of competent jurisdiction), the Issuing Bank shall be
deemed to have exercised reasonable care. Borrowers hereby
waive any right to object to any payment made under any Letter
of Credit with regard to a drawing that is in the form
provided in such Letter of Credit but which varies with
respect to punctuation, capitalization, spelling or similar
matters of form.
(vi) Reports of Issuing Bank. Issuing Bank shall,
if requested by Agent or any Lender, provide to Agent on a
monthly basis such information regarding the Letters of Credit
as Agent may reasonably request, including the Letters of
Credit outstanding, the stated amounts of outstanding Letters
of Credit, the expiration dates of outstanding Letters of
Credit, the names of the beneficiaries of outstanding Letters
of Credit, the amounts of unpaid Reimbursement Obligations and
the amounts and times of Drawing Payments and Reimbursement
Payments. Upon request by any Lender, Agent shall provide such
information to the Lenders.
23
(vii) Resignation or Removal of Issuing Bank.
Issuing Bank may resign at any time by giving thirty (30) days
prior written notice thereof to Borrowers and Lenders, and
Issuing Bank may be removed at any time with or without cause
by written agreement among Borrowers, Agent and the successor
Issuing Bank; provided, however, that Borrowers shall have no
right to approve a successor Issuing Bank if a Default has
occurred and is continuing. If no successor Issuing Bank shall
have been so appointed and shall have accepted such
appointment within thirty (30) days of after the retiring
Issuing Bank gives notice of its resignation, then the
retiring Issuing Bank may, on behalf of Lenders and Agent,
appoint a successor Issuing Bank, which shall be a bank with
an office in New York, New York, or an Affiliate of any such
bank. Upon the acceptance of any appointment as Issuing Bank
hereunder, Agent shall notify Lenders of such successor
Issuing Bank, which shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of
the retiring Issuing Bank. At the time any such replacement
shall become effective, Borrowers shall pay all unpaid fees
and expenses accrued for the account of the retiring Issuing
Bank pursuant to Subparagraphs 2.06(c)(ii) and (iii). After
the replacement of the retiring Issuing Bank, the retiring
Issuing Bank shall remain a party hereto and shall continue to
have all rights and obligations of the Issuing Bank under this
Agreement with respect to Letters of Credit issued by it prior
to such replacement, but it shall not be required to issue
additional Letters of Credit.
2.02. Notice of Borrowing. Borrowers shall request each Borrowing by
delivering to Agent an irrevocable written notice in the form of Exhibit A,
appropriately completed (a "Notice of Borrowing"), which specifies, among other
things:
(a) The Currency and principal amount of such Borrowing,
which shall be in the minimum Dollar amount or Dollar Equivalent of
Five Million Dollars ($5,000,000) or an integral multiple of One
Million Dollars ($1,000,000) in excess thereof, provided that
Borrowings may be in an aggregate amount that is equal to the entire
Unused amount of the Commitments;
(b) Whether such requested Borrowing is to consist of
Base Rate Loans or LIBOR Loans;
(c) If such Borrowing is to consist of LIBOR Loans, the
initial Interest Period selected by the applicable Borrower for such
Borrowing in accordance with Subparagraph 2.03(b)(i);
(d) The date of such Borrowing, which shall be a Business
Day; and
(e) The applicable Borrower for such Borrowing.
Borrowers shall give each Notice of Borrowing to Agent at least four (4)
Business Days before the date of the requested Borrowing in the case of a
Borrowing in an Alternative Currency, at three (3) Business Days before the date
of the requested Borrowing in the case of a Borrowing consisting of LIBOR Loans
in Dollars and at least one (1) Business Day before the date of the requested
Borrowing in the case of a Borrowing in Dollars consisting of Base Rate Loans.
Each Notice of Borrowing shall be signed by a Responsible Officer of the
applicable Borrower and delivered by first-class mail or facsimile to Agent at
the office or facsimile number and during the hours specified in Paragraph 8.01;
provided, however, that Borrowers shall promptly deliver to Agent the original
of any Notice of Borrowing initially delivered by facsimile. Agent shall
promptly notify each Lender of the contents of each Notice of Borrowing.
2.03. Interest.
(a) Interest Rates. Borrowers shall pay interest on the
unpaid principal amount of each Loan from the date of such Loan until
the maturity thereof, at one of the following rates per annum:
(i) During such periods as any Loan is a Base
Rate Loan, at a rate per annum on such Loan equal to the Base
Rate plus the Applicable Margin therefor, such rate to change
from time to time as the Applicable Margin or Base Rate shall
change; and
24
(ii) During such periods as any Loan is a LIBOR
Loan, at a rate per annum on such Loan equal at all times
during each Interest Period for such Loan to the LIBO Rate for
such Interest Period plus the Applicable Margin therefor, such
rate to change from time to time as the Applicable Margin
shall change.
All Loans in each Borrowing shall, at any given time prior to maturity,
bear interest at one, and only one, of the above rates. Only Borrowings
in Dollars may be Base Rate Loans. Each LIBOR Loan Borrowing shall be
in a minimum amount of Five Million Dollars ($5,000,000) and an
integral multiple of One Million Dollars ($1,000,000) in excess
thereof.
(b) Terms.
(i) LIBOR Loan Interest Periods. The initial and
each subsequent Interest Period selected by a Borrower for any
Borrowing consisting of LIBOR Loans shall be one (1), two (2),
three (3) or six (6) months; provided, however, that (A) any
Interest Period which would otherwise end on a day which is
not a Business Day shall be extended to the next succeeding
Business Day unless such next Business Day falls in another
calendar month, in which case such Interest Period shall end
on the immediately preceding Business Day, (B) any Interest
Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of a
calendar month, and (C) no Interest Period for a Borrowing
shall end after the Maturity Date.
(ii) Notice of Interest Period Selection. The
applicable Borrower shall notify Agent by an irrevocable
written notice in a form acceptable to Agent, appropriately
completed (a "Notice of Interest Period Selection"), at least
four (4) Business Days prior to the last day of each Interest
Period for any Borrowing in an Alternative Currency and at
least three (3) Business Days prior to the last day of each
Interest Period for a Borrowing in Dollars consisting of LIBOR
Loans of the Interest Period selected by such Borrower for the
next succeeding Interest Period for such Borrowing. Each
Notice of Interest Period Selection shall be given by
first-class mail or facsimile to the office or the facsimile
number and during the hours specified in Paragraph 8.01;
provided, however, that the applicable Borrower shall promptly
deliver to Agent the original of any Notice of Interest Period
Selection initially delivered by facsimile. If any Borrower
fails to notify Agent of the next Interest Period for a
Borrowing in accordance with this Subparagraph 2.03(b)(ii),
the next Interest Period for such Borrowing shall be one (1)
month, and if no Currency is specified, then the Borrowing
shall be deemed to continue in the same Currency as the
existing Loan. Agent shall promptly notify each Lender of the
contents of each Notice of Interest Period Selection.
(iii) Conversion of Borrowings. Each Borrowing
initially shall be of the type specified in the applicable
Notice of Borrowing and, in the case of a LIBOR Loan, shall
have an initial Interest Period as specified in such Notice of
Borrowing. Thereafter, Borrower(s) may elect to convert such
Borrowing to a different type or to continue such Borrowing
and, in the case of a LIBOR Loan, may elect Interest Periods
therefor, all as provided in this Paragraph 2.03. Borrowers
may elect different options with respect to different portions
of the affected Borrowing, in which case each such portion
shall be allocated ratably among Lenders holding the Loans
comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing.
Notwithstanding any contrary provision of this Agreement, (A)
in no event shall any Borrower be permitted to convert a Loan
in one Currency into a Loan of a different Currency (as
opposed to repaying such Loan and thereafter obtaining a new
Loan) and (B) if an Event of Default has occurred and is
continuing and Agent, at the written request of the Required
Lenders, so notifies the applicable Borrower, then (1) no
outstanding Borrowing may be converted to or continued as a
Borrowing consisting of LIBOR Loans in Dollars, (2) unless
repaid, each Borrowing consisting of LIBOR Loans in Dollars
shall be converted to a Borrowing consisting of Base Rate
Loans in Dollars at the end of the Interest Period applicable
thereto and (3) unless repaid, each Borrowing consisting of
LIBOR Loans in an Alternative Currency shall be continued
25
as a Borrowing consisting of LIBOR Loans in an Alternative
Currency with an Interest Period of one month's duration.
2.04. Purpose. Borrowers shall use any proceeds of any initial Loans
made on the Closing Date for (a) working capital and general corporate needs
(including capital expenditures, acquisitions permitted under Subparagraph
5.02(d) and investments permitted under Subparagraph 5.02(e), respectively) and
(b) repaying on the Closing Date all indebtedness outstanding under the Existing
FIL Credit Agreement, if any, and thereafter Borrowers shall use the proceeds of
the Loans for their respective working capital and general corporate needs
(including capital expenditures).
2.05. Amount Limitations, Commitment Reductions, Etc.
(a) Commitment Limitations. The Dollar amount or Dollar
Equivalent (as applicable) of the aggregate principal amount of all
Loans outstanding plus the aggregate Dollar amount or Dollar Equivalent
(as applicable) available for drawing under all Letters of Credit
outstanding at such time plus the aggregate Dollar amount or Dollar
Equivalent (as applicable) of all Reimbursement Obligations outstanding
at such time shall not exceed the Total Commitment at such time.
(b) Determination of Dollar Equivalent. For the purposes
of applying the amount limitations set forth in Subparagraph 2.05(a)
and calculating the Unused Total Commitment and the available amount
under the Letter of Credit subfacility and for all other purposes
herein, the Dollar Equivalent of each Loan and Letter of Credit in an
Alternative Currency shall be determined by Agent on the date of such
Loan or Letter of Credit, on the last day of each month and, if an
Event of Default has occurred and is continuing, at any other time
determined by Agent, and the Dollar Equivalent of such Loan and Letter
of Credit at any time shall be the Dollar Equivalent most recently so
determined by Agent. Each such determination by Agent shall, in the
absence of manifest error, be conclusive and binding on the parties
hereto.
(c) Reduction or Cancellation of Commitments. Upon five
(5) Business Days prior written notice to Agent, Borrowers may
permanently reduce the Total Commitment by the Dollar amount or Dollar
Equivalent (as applicable) amount of Five Million Dollars ($5,000,000)
or integral multiples in excess thereof, or cancel the Total Commitment
in its entirety; provided, however, that:
(i) Borrowers may not reduce the Total
Commitment prior to the Maturity Date, if, after giving effect
to such reduction, the Dollar Equivalent of the aggregate
principal amount of all Loans then outstanding plus the
aggregate amount available for drawing under all Letters of
Credit outstanding at such time plus the aggregate amount of
all Reimbursement Obligations outstanding at such time would
exceed the Total Commitment; and
(ii) Borrowers may not cancel the Total
Commitment prior to the Maturity Date, if, after giving effect
to such cancellation, any Loan, Reimbursement Obligation or
Letter of Credit would then remain outstanding.
Unless sooner terminated pursuant to this Agreement, the Commitments
shall terminate on the Maturity Date.
(d) Effect of Commitment Reductions. From the effective
date of any reduction of the Total Commitment, the Commitment Fees
payable pursuant to Subparagraph 2.06(b) shall be computed on the basis
of the Total Commitment as so reduced. Once reduced or cancelled, the
Total Commitment may not be increased or reinstated without the prior
written consent of all Lenders. Any reduction of the Total Commitment
shall be applied ratably to reduce each Lender's Commitment in
accordance with Subparagraph 2.11(a)(i).
2.06. Fees.
26
(a) Agent's Fee. Borrowers shall pay to Agent, for its
own account, agent's fees and other compensation in the amounts and at
the times set forth in the Agent's Fee Letter (the "Agent's Fees").
(b) Commitment Fees. Borrowers shall pay to Agent, for
the ratable benefit of Lenders as provided in Subparagraph 2.11(a)(v),
commitment fees in Dollars (the "Commitment Fees") equal to the
Commitment Fee Percentage of the daily average Unused amount of the
Total Commitment for the period beginning on the date of this Agreement
and ending on the Maturity Date.
Borrowers shall pay the Commitment Fees in arrears on the last day of
each March, June, September and December (commencing March 31, 2004)
and on the Maturity Date (or any portion of the Total Commitment or is
cancelled on a date prior to the Maturity Date, on such prior date).
(c) Letter of Credit Fees.
(i) Letter of Credit Usage Fees. Borrowers shall
pay to Agent, for the ratable benefit of the Lenders as
provided in Subparagraph 2.11(a)(v), nonrefundable letter of
credit fees for the Letters of Credit (the "LC Usage Fees")
equal to the greater of (A) the applicable LC Usage Fee Rate
(as such rate changes from time to time) on the daily average
available amount of each Letter of Credit for the period
beginning on the date such Letter of Credit is issued and
ending on the date such Letter of Credit expires and (B) Five
Hundred Dollars ($500). Borrowers shall pay the LC Usage Fees
quarterly in arrears on the last day in each March, June,
September and December (commencing March 31, 2004) and on the
date the last Letter of Credit expires (or if a demand for
payment is made on the last outstanding Letter of Credit on a
date prior to the date the last Letter of Credit expires, on
such date).
(ii) Letter of Credit Issuance Fees. Borrowers
shall pay to Agent, for the sole benefit of Issuing Bank,
nonrefundable issuance fees for the Letters of Credit (the "LC
Issuance Fees") equal to the greater of (A) 1/8th of one
percent (0.125%) per annum on the daily average undrawn amount
of each Letter of Credit for the period beginning on the date
such Letter of Credit is issued and ending on the date such
Letter of Credit expires and (B) one hundred fifty dollars
($150). Borrowers shall pay the LC Issuance Fees for each
Letter of Credit quarterly in arrears on the last day in each
March, June, September and December (commencing March 31,
2004) and on the date the last Letter of Credit expires (or if
a demand for payment is made on the last outstanding Letter of
Credit on a date prior to the date the last Letter of Credit
expires, on such prior date).
(iii) Other Letter of Credit Fees. In addition to
the LC Usage Fees and the LC Issuance Fees, Borrowers shall
pay to Agent, for the sole benefit of Issuing Bank, other
standard fees of Issuing Bank for drawings under, transfers of
and amendments to any Letter of Credit and other
administrative actions performed by Issuing Bank in connection
with any Letter of Credit, payable at such times and in such
amounts as are consistent with Issuing Bank's standard fee
policy at the time of such amendment or other action.
2.07. Prepayments.
(a) Terms of all Prepayments. Upon the prepayment of any
Loan (whether such prepayment is an optional prepayment under
Subparagraph 2.07(b), a mandatory prepayment required by Subparagraph
2.07(c) or a mandatory prepayment required by any other provision of
this Agreement or the other Credit Documents, including a prepayment
upon acceleration), the applicable Borrower shall pay to the Lender
that made such Loan (i) all accrued interest to the date of such
prepayment on the amount prepaid and (ii) if such prepayment is the
prepayment of a LIBOR Loan on a day other than the last day of an
Interest Period for such LIBOR Loan, all amounts payable to such Lender
pursuant to Paragraph 2.14.
27
(b) Optional Prepayments. At its option, any Borrower may
prepay, in whole or in part, any Borrowing made to it, provided that:
(i) Such Borrower delivers to Agent prior
written notice of such prepayment, which notice shall be
delivered (A) not less than four (4) Business Days prior to
the prepayment of any Borrowing consisting of LIBOR Loans in
an Alternative Currency, (B) not less than three (3), Business
Days prior to the prepayment of any Borrowing consisting of
LIBOR Loans in Dollars, and (C) not less than one (1) Business
Day prior to any prepayment of a Base Rate Borrowing; and
(ii) Any prepayment in part shall be in a minimum
aggregate principal amount equal to the Dollar amount or
Dollar Equivalent (as applicable) of Five Million Dollars
($5,000,000) or an integral multiple of One Million Dollars
($1,000,000) in excess thereof, provided that prepayments may
be in an aggregate amount that is equal to the aggregate
amount of all Borrowings outstanding.
(c) Mandatory Prepayments. If, at any time, the aggregate
Dollar amount or Dollar Equivalent of the principal amount of all Loans
then outstanding plus the aggregate amount available for drawing under
all Letters of Credit outstanding at such time plus the aggregate
amount of all Reimbursement Obligations outstanding at such time
exceeds any limitations set forth in Subparagraphs 2.05(a), the
applicable Borrower(s) shall immediately (A) prepay Loans then
outstanding and/or pay any Reimbursement Obligations then outstanding
to the extent necessary to eliminate such excess and (B) to the extent
any excess still remains, provide to Agent cash collateral in the
amount of such excess. Agent shall hold any such cash in a non-interest
bearing account as collateral for the Obligations. Borrowers hereby
grant to Agent for the benefit of the Lenders, a security interest in
such funds and in such account.
(d) Application of Prepayments. All prepayments of
Borrowings shall, to the extent possible, be applied to prepay the Base
Rate Borrowings or LIBOR Borrowings designated by any Borrower.
2.08. Other Payment Terms.
(a) Place and Manner.
(i) Borrowers shall make all payments due to
each Lender or Agent hereunder by payments to Agent at Agent's
New York office located at the address specified in Paragraph
8.01, with each such payment due to a Lender to be for the
account of such Lender.
(ii) Borrowers shall make all payments hereunder
in the lawful Currency required by Subparagraph 2.08(c) and in
same day or immediately available funds and without deduction
or offset not later than 2:00 p.m. New York City time and on
the date due. Agent shall promptly disburse to each Lender
each payment received by Agent for the account of such Lender.
(b) Date. Whenever any payment due hereunder shall fall
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 be
included in the computation of interest or fees, as the case may be;
provided, however, that payment of interest on LIBOR Loans shall be
made on the last day of the applicable Interest Period (as specified in
Subparagraph 2.03(b)(i)).
(c) Currency of Payment.
(i) Borrowers shall pay principal of, interest
on and all other amounts related to each Borrowing or
Reimbursement Payment in the Currency of such Borrowing or
Reimbursement Payment, as applicable. Borrowers shall pay
Commitment Fees and all other amounts payable
28
under this Agreement and the other Credit Documents in
Dollars. If, for any reason, any Borrower is prohibited by any
Governmental Rule from making any required payment hereunder
in an Alternative Currency, such Borrower shall make such
payment in Dollars in an amount equal to the Dollar Equivalent
of such Alternative Currency as determined by Agent.
(ii) If any amounts required to be paid by
Borrowers under this Agreement, any other Credit Document or
any order, judgment or award given or rendered in relation
hereto or thereto has to be converted from the currency (the
"first currency") in which the same is payable hereunder or
thereunder into another currency (the "second currency") for
the purpose of (A) making or filing a claim or proof against
Borrowers with any Governmental Authority, (B) obtaining an
order or judgment in any court or other tribunal or (C)
enforcing any order or judgment given or made in relation
hereto, Borrowers shall, to the fullest extent permitted by
law, indemnify and hold harmless each of the Persons to whom
such amounts are payable from and against any loss suffered as
a result of any discrepancy between (1) the rate of exchange
used for such purpose to convert the amounts in question from
the first currency into the second currency and (2) the rate
or rates of exchange at which such Person may, using
reasonable efforts in the ordinary course of business,
purchase the first currency with the second currency upon
receipt of a sum paid to it in satisfaction, in whole or in
part, of any such order, judgment, claim or proof. The
foregoing indemnity shall constitute a separate obligation of
Borrowers distinct from their other obligations hereunder and
shall survive the giving or making of any judgment or order in
relation to all or any of such obligations. The obligations of
Borrowers under this Subparagraph 2.08(c) shall survive the
payment and performance of the Obligations and the
termination of this Agreement.
(d) Late Payments. If any amount required to be paid by
any Borrower under this Agreement or the other Credit Documents
(including principal or interest payable on any Loan, any Reimbursement
Payments or interest thereon, any fees or other amounts) remains unpaid
after such amount is due, such Borrower shall pay interest on the
aggregate, outstanding balance of such amount from the date due until
such amount is paid in full at a per annum rate equal to (i) in the
case any amount payable in Dollars, the Base Rate plus two percent
(2.00%), such rate to change from time to time as the Base Rate shall
change, and (ii) in the case of any amount payable in an Alternative
Currency, the Overnight Rate for such amount plus three percent
(3.00%), such rate to change from time to time as the Overnight Rate
shall change.
(e) Application of Payments. All payments hereunder shall
be applied first to unpaid fees, costs and expenses then due and
payable under this Agreement or the other Credit Documents, second to
accrued interest then due and payable under this Agreement or the other
Credit Documents and finally to reduce the principal amount of
outstanding Loans and unpaid Reimbursement Obligations.
(f) Failure to Pay Agent. Unless Agent shall have
received notice from a Borrower at least one (1) Business Day prior to
the date on which any payment is due to Lenders hereunder that such
Borrower will not make such payment in full, Agent shall be entitled to
assume that such Borrower has made or will make such payment in full to
Agent on such date and Agent may, in reliance upon such assumption,
cause to be paid to the applicable Lenders on such due date an amount
equal to the amount then due such Lenders. If and to the extent such
Borrower shall not have so made such payment in full to Agent, each
such Lender shall repay to Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day
from the date such amount is distributed to such Lender until the date
such Lender repays such amount to Agent, at a per annum rate equal to
(i) the Federal Funds Rate for any amount in Dollars or (ii) the
Overnight Rate for the first three (3) days and the Overnight Rate plus
one percent (1%) thereafter for any amount in an Alternative Currency.
A certificate of Agent submitted to any Lender with respect to any
amount owing by such Lender under this Subparagraph 2.08(f) shall
constitute prima facie evidence of such amount.
2.09. Loan Accounts; Notes.
29
(a) Loan Accounts. The obligation of each Borrower to
repay the Loans made to it by each Lender and to pay interest thereon
at the rates provided herein shall be evidenced by an account or
accounts maintained by such Lender on its books (individually, a "Loan
Account"), except that any Lender may request that its Loans be
evidenced by a note or notes pursuant to Subparagraph 2.09(b). Each
Lender shall record in its Loan Accounts (i) the date, amount and
Currency of each Loan made by such Lender, (ii) the interest rates
applicable to each such Loan thereof and the effective dates of all
changes thereto, (iii) the Interest Period for each LIBOR Loan, (iv)
the date, amount and Currency of each principal and interest payment on
each Loan and (v) such other information as such Lender may determine
is necessary for the computation of principal and interest payable to
it by each Borrower hereunder; provided, however, that any failure by a
Lender to make, or any error by any Lender in making, any such notation
shall not affect Borrowers' Obligations hereunder. The Loan Accounts
shall constitute prima facie evidence of the matters noted therein.
(b) Notes. If any Lender so requests, such Lender's Loans
under each Facility shall be evidenced by promissory notes in the form
of Exhibit B (individually, a "Note"), which shall be (i) payable to
the order of such Lender, (ii) dated the Closing Date, and (iii)
otherwise appropriately completed.
2.10. Loan Funding.
(a) Lender Funding and Disbursements to Borrowers. Each
Lender shall, before 2:00 p.m. (New York City time) on the date of each
Borrowing, make available to Agent at Agent's New York office specified
in Paragraph 8.01, in immediately available funds, such Lender's
applicable Proportionate Share of such Borrowing. After Agent's receipt
of such funds and upon satisfaction of the applicable conditions set
forth in Section III, Agent shall promptly disburse such funds to the
applicable Borrower no later than 4:00 p.m. (New York City time) in
immediately available funds. Agent shall disburse the proceeds of each
Borrowing as directed by the applicable Borrower in the applicable
Notice of Borrowing.
(b) Lender Failure to Fund. Unless Agent shall have
received notice from a Lender prior to the date of a Borrowing that
such Lender will not make available to Agent such Lender's
Proportionate Share of such Borrowing, Agent shall be entitled to
assume that such Lender has made or will make such amount available to
Agent on the date of such Borrowing in accordance with Subparagraph
2.10(a), and Agent may on such date, in reliance upon such assumption,
disburse or otherwise credit to the applicable Borrower a corresponding
amount. If any Lender does not make the amount of its applicable
Proportionate Share of a Borrowing available to Agent on or prior to
the date of such Borrowing, such Lender shall pay to Agent, on demand,
interest which shall accrue on such amount from the date of such
Borrowing until such amount is paid to Agent at rates equal to (i) the
Federal Funds Rate for any amount in Dollars or (ii) the Overnight Rate
plus one percent (1%) for any amount in an Alternative Currency. A
certificate of Agent submitted to any Lender with respect to any amount
owing by such Lender under this Subparagraph 2.10(b) shall constitute
prima facie evidence of such amount. If the amount of any Lender's
applicable Proportionate Share of any Borrowing is not paid to Agent by
such Lender within three (3) Business Days after the date of such
Borrowing, the applicable Borrower shall repay such amount to Agent, on
demand, together with interest thereon, for each day from the date such
amount was disbursed to such Borrower until the date such amount is
repaid to Agent, at the interest rate applicable at the time to the
Loans comprising such Borrowing.
(c) Lenders' Obligations Several. The failure of any
Lender to make the Loan to be made by it as part of any Borrowing shall
not relieve any other Lender of its obligation hereunder to make its
Loan as part of such Borrowing, but no Lender shall be obligated in any
way to make any Loan which another Lender has failed or refused to make
or otherwise be in any way responsible for the failure or refusal of
any other Lender to make any Loan required to be made by such other
Lender.
2.11. Pro Rata Treatment.
(a) Borrowings, Commitment Reductions, Etc. Except as
otherwise provided herein:
30
(i) Each Borrowing, each participation in each
Letter of Credit and reduction of the Total Commitment shall
be made or shared among Lenders pro rata according to their
respective Proportionate Shares;
(ii) Each payment of principal on Loans in any
Borrowing shall be shared among Lenders which made or funded
the Loans in such Borrowing pro rata according to the
respective unpaid principal amounts of such Loans then owed to
such Lenders;
(iii) Each payment of interest on Loans in any
Borrowing shall be shared among Lenders which made or funded
the Loans in such Borrowing pro rata according to (A) the
respective unpaid principal amounts of such Loans then owed to
such Lenders so made or funded by such Lenders and (B) the
dates on which such Lenders so made or funded such Loans;
(iv) Each Reimbursement Payment shall be shared
among the Lenders (including Issuing Bank) which made or
funded the applicable Drawing Payment pro rata according to
the respective amounts of such Drawing Payment so made or
funded by such Lenders;
(v) Each payment of Commitment Fees and LC Usage
Fees shall be shared among Lenders (except for Defaulting
Lenders but including, with respect to LC Usage Fees, Issuing
Bank in its capacity as a Lender) pro rata according to their
respective Proportionate Shares;
(vi) Each payment of interest (other than
interest on Loans) shall be shared among Lenders and Agent
owed the amount upon which such interest accrues pro rata
according to (A) the respective amounts so owed such Lenders
and Agent and (B) the dates on which such amounts became owing
to such Lenders and Agent; and
(vii) All other payments under this Agreement and
the other Credit Documents shall be for the benefit of the
Person or Persons specified.
(b) Sharing of Payments, Etc. If any Lender shall obtain
any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise) on account of the Loan owed to it
as part of any Borrowing in excess of its ratable share of payments on
account of all Loans in such Borrowing obtained by all applicable
Lenders entitled to such payments or Reimbursement Obligations, such
Lender shall forthwith purchase from such other Lenders such
participations in their Loans or Reimbursement Obligations as shall be
necessary to cause such purchasing Lender 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 such
purchasing Lender, such purchase shall be rescinded and each other
applicable Lender shall repay to the purchasing Lender the purchase
price to the extent of such recovery together with an amount equal to
such other Lender's ratable share (according to the proportion of (i)
the amount of such other Lender's required repayment to (ii) the total
amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the
total amount so recovered. Each Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to Subparagraph
8.05(b) may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor of
such Borrower in the amount of such participation.
2.12. Change of Circumstances.
(a) Inability to Obtain Funds, Determine Rates, Etc. If,
on or before the first day of any Interest Period for any LIBOR
Borrowing in any Currency, Agent shall determine (which determination
shall be conclusive and binding upon Borrowers absent manifest error)
that (i) funds in the Currency of such Borrowing are not readily
available in the amounts necessary for such Borrowing in the London
interbank market, (ii) the LIBO Rate for such Interest Period for such
Borrowing cannot be adequately and reasonably determined due to other
circumstances affecting the London interbank market or (iii) the rate
of
31
interest for such Borrowing does not adequately and fairly reflect the
cost to Lenders of making or maintaining such Borrowing, Agent shall
immediately give notice of such condition to the applicable Borrowers
and the applicable Lenders. After the giving of any such notice and
until Agent shall otherwise notify the applicable Borrowers that the
circumstances giving rise to such condition no longer exist, such
Borrowers' right to obtain, continue or convert to Borrowings in the
affected Currency shall be suspended. Any LIBOR Borrowings in the
affected Currency outstanding at the commencement of any such
suspension shall be repaid at the end of the then current Interest
Period for such Borrowings unless such suspension has then ended.
(b) Illegality. If, after the date of this Agreement, the
adoption of any Governmental Rule, any change in any Governmental Rule
or the application or requirements thereof (whether such change occurs
in accordance with the terms of such Governmental Rule as enacted, as a
result of amendment or otherwise), any change in the interpretation or
administration of any Governmental Rule by any Governmental Authority,
or compliance by any Lender with any request or directive (whether or
not having the force of law) of any Governmental Authority (a "Change
of Law") shall make it unlawful or impossible for any Lender to make or
maintain any LIBOR Loan in any Currency, such Lender shall immediately
notify Agent and the applicable Borrower of such Change of Law. Upon
receipt of such notice, (i) such Borrower's right to obtain, continue
or convert to LIBOR Loans in the affected Currency shall be suspended
until such time as Agent shall notify such Borrower and the applicable
Lenders that the circumstances giving rise to such suspension no longer
exist, and (ii) such Borrower shall, if so requested by such Lender,
immediately repay such LIBOR Loans in the affected Currency if such
Lender shall notify such Borrower that such Lender may not lawfully
continue to fund and maintain such LIBOR Loans. Any prepayment of LIBOR
Loans made pursuant to the preceding sentence prior to the last day of
an Interest Period for such LIBOR Loans shall be deemed a prepayment
thereof for purposes of Paragraph 2.14.
(c) Increased Costs. If, after the date of this
Agreement, any Change of Law:
(i) Shall subject any Lender to any tax, duty or
other charge with respect to any LIBOR Loan, or shall change
the basis of taxation of payments by any Borrower to any such
Lender on such a LIBOR Loan, or in respect to such a LIBOR
Loan, under this Agreement (except for changes in the rate of
taxation on the overall net income of such Lender imposed by
its jurisdiction of incorporation, the jurisdiction of its
Applicable Lending Office, or a jurisdiction in which such
Participant is doing business without regard to the
transactions contemplated by this Agreement); or
(ii) Shall impose, modify or hold applicable any
reserve (excluding any Reserve Requirement or other reserve to
the extent included in the calculation of the LIBO Rate for
any Loans), special deposit or similar requirement against
assets held by, deposits or other liabilities in or for the
account of, advances or loans by, or any other acquisition of
funds by any Lender for any LIBOR Loan; or
(iii) Shall impose on any Lender any other
condition related to any LIBOR Loan, any Letter of Credit or
such Lender's Commitments;
And the effect of any of the foregoing is to increase the cost to such
Lender of making, continuing or maintaining any such LIBOR Loan, any
Letter of Credit or its Commitments or to reduce any amount receivable
by such Lender hereunder; then Borrowers shall from time to time,
within ten (10) Business Days after demand by such Lender, pay to such
Lender additional amounts sufficient to reimburse such Lender for such
increased costs or to compensate such Lender for such reduced amounts;
provided, however, that Borrowers shall have no obligation to make any
payment to any demanding party under this Subparagraph 2.12(c) on
account of any such increased costs or reduced amounts unless Borrowers
receive notice of such increased costs or reduced amounts from the
demanding party within twelve (12) months after such increased costs or
reduced amounts have been incurred or realized accompanied by a
certificate executed by an officer of the applicable Lender setting
forth in reasonable detail the basis and calculation of the amount of
such increased costs or reduced amounts, which certificate shall
constitute prima facie
32
evidence of such costs or amounts. The obligations of Borrowers under
this Subparagraph 2.12(c) shall survive the payment and performance of
the Obligations and the termination of this Agreement.
(d) Capital Requirements. If, after the date of this
Agreement, any Lender determines that (i) any Change of Law affects the
amount of capital required or expected to be maintained by such Lender
or any Person controlling such Lender (a "Capital Adequacy
Requirement") and (ii) the amount of capital maintained by such Lender
or such Person which is attributable to or based upon the Loans, the
Letters of Credit, the Commitments or this Agreement must be increased
as a result of such Capital Adequacy Requirement (taking into account
such Lender's or such Person's policies with respect to capital
adequacy), Borrowers shall pay to such Lender or such Person, within
ten (10) Business Days after demand of such Lender, such amounts as
such Lender or such Person shall determine are necessary to compensate
such Lender or such Person for the increased costs to such Lender or
such Person of such increased capital; provided, however, that
Borrowers shall have no obligation to make any payment to any demanding
party under this Subparagraph 2.12(d) on account of any such increased
costs unless Borrowers receive notice of such increased costs from the
demanding party within twelve (12) months after such increased costs
been incurred or realized accompanied by a certificate executed by an
officer of the applicable Lender setting forth in reasonable detail the
basis and calculation of the amount of such increased costs, which
certificate shall constitute prima facie evidence of such costs. The
obligations of Borrowers under this Subparagraph 2.12(d) shall survive
the payment and performance of the Obligations and the termination of
this Agreement.
(e) Mitigation. Any Lender which becomes aware of (i) any
Change of Law which will make it unlawful or impossible for such Lender
to make or maintain any LIBOR Loan or (ii) any Change of Law or other
event or condition which will obligate Borrowers to pay any amount
pursuant to Subparagraph 2.12(c) or Subparagraph 2.12(d) shall notify
Borrowers and Agent thereof as promptly as practical. If any Lender has
given notice of any such Change of Law or other event or condition and
thereafter becomes aware that such Change of Law or other event or
condition has ceased to exist, such Lender shall notify Borrowers and
Agent thereof as promptly as practical. Each Lender affected by any
Change of Law which makes it unlawful or impossible for such Lender to
make or maintain any LIBOR Loan or to which Borrowers are obligated to
pay any amount pursuant to Subparagraph 2.12(c) or Subparagraph 2.12(d)
shall use reasonable commercial efforts (including changing the
jurisdiction of its Applicable Lending Offices) to avoid the effect of
such Change of Law or to avoid or materially reduce any amounts which
Borrowers are obligated to pay pursuant to Subparagraph 2.12(c) or
Subparagraph 2.12(d) if, in the reasonable opinion of such Lender, such
efforts would not be disadvantageous to such Lender or contrary to such
Lender's normal banking practices.
2.13. Taxes on Payments.
(a) Payments Free of Taxes. All payments made by
Borrowers under this Agreement and the other Credit Documents shall be
made free and clear of, and, except as provided herein, without
deduction or withholding for or on account of, Non-Excluded Taxes. If
any Non-Excluded Taxes are required to be withheld from any amounts
payable to Agent or any Lender hereunder or under the other Credit
Documents, the amounts so payable to Agent or such Lender shall be
increased to the extent necessary to yield to Agent or such Lender
(after payment of all Non-Excluded Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in
this Agreement and the other Credit Documents. Whenever any
Non-Excluded Taxes are payable by Borrowers, as promptly as possible
thereafter, Borrowers shall send to Agent for its own account or for
the account of such Lender, as the case may be, a certified copy of an
original official receipt received by Borrowers showing payment
thereof. If Borrowers fail to pay any Non-Excluded Taxes when due to
the appropriate taxing authority or fails to remit to Agent the
required receipts or other required documentary evidence, Borrowers
shall indemnify Agent and Lenders for any taxes (including interest or
penalties) that may become payable by Agent or any Lender as a result
of any such failure. The obligations of Borrowers under this Paragraph
2.13 (i) shall be subject to the indemnification provisions contained
in Paragraph 8.03 and (ii) shall survive the payment and performance of
the Obligations and the termination of this Agreement.
33
(b) Withholding Exemption Certificates. Each Borrower may
from time to time, by written notice to the Agent and each Lender,
designate an office from which payments under this Agreement shall be
made (an "Applicable Payment Office"). FIL's Applicable Payment Office
shall be deemed to be in Hong Kong unless otherwise designated in
writing by FIL. If a Borrower other than FIL does not designate an
Applicable Payment Office, such Borrower's Applicable Payment Office
shall be deemed to be located in the jurisdiction in which such
Borrower is organized. On or prior to the Closing Date (or, with
respect to any Lender which is not a party to this Agreement on the
Closing Date, on or prior to the date any other Lender becomes a Lender
hereunder), each Lender which is not organized under the laws of the
jurisdiction of a Borrower's Applicable Payment Office shall notify the
applicable Borrower whether such Lender is entitled to receive payments
on its Loans under this Agreement from such Borrower's Applicable
Payment Office for the account of such Lender's Lending Office without
deduction or withholding of any income taxes (or with reduced deduction
or withholding of any such taxes) imposed by the jurisdiction of such
Borrower's Applicable Payment Office. If such Lender is so entitled, it
shall promptly deliver to such Borrower and/or any other appropriate
person(s) such certificates, forms and/or other documents as it may
lawfully provide certifying that such Lender is entitled to receive
such payments without deduction or withholding of taxes (or with
reduced deduction or withholding of any such taxes) as such Borrower
shall reasonably request to establish such fact. If such Lender is not
entitled to receive payments on its Loans without deduction or
withholding of taxes (or with reduced deduction or withholding of any
such taxes) and cannot lawfully provide any such forms, it shall
continue to be entitled to the benefits of Subparagraph 2.13(a). If,
after the Closing Date, any Borrower designates an Applicable Payment
Office that is different than such Borrower's then existing Applicable
Payment Office, each Lender which is not organized under the laws of
the jurisdiction of such new Applicable Payment Office shall, as soon
as practicable and in any event within thirty (30) days of such
designation (or if not practicable within such period, then as soon as
practicable thereafter but in any event within a period of sixty (60)
days of such designation), notify the applicable Borrower whether such
Lender is entitled to receive payments on its Loans under this
Agreement from such Borrower's new Applicable Payment Office for the
account of such Lender's Lending Office without deduction or
withholding of any income taxes (or with reduced deduction or
withholding of any such taxes) imposed by the jurisdiction of such
Borrower's new Applicable Payment Office and promptly deliver to such
Borrower and/or any other appropriate person(s) such certificates,
forms, and/or other documents as it may lawfully provide certifying
that such Lender is entitled to receive such payments without deduction
or withholding of taxes (or with reduced deduction or withholding of
any such taxes) as such Borrower shall reasonably request to establish
such fact. Each such Lender further agrees (i) promptly to notify the
applicable Borrowers and Agent of any change of circumstances
(including any change in any treaty, law or regulation or any change of
such Lender's Applicable Lending Office) which would prevent such
Lender from receiving such payments hereunder without any deduction or
withholding of such taxes (or with reduced deduction or withholding of
any such taxes) and (ii) if such Lender is still legally entitled to do
so, then on or before the date that any certificate, form and/or other
documents delivered by such Lender under this Subparagraph 2.13(b)
expires or otherwise becomes inapplicable, to deliver to such Borrowers
and Agent a new certificate, form and/or other documents, certifying
that such Lender is entitled to receive such payments under this
Agreement without deduction or withholding of such taxes (or with
reduced deduction or withholding of any such taxes). If any Lender that
may lawfully provide such certification fails to provide to Agent and
the applicable Borrower pursuant to this Subparagraph 2.13(b) (or, in
the case of an Assignee Participant, Subparagraph 8.05(b)) any
notifications, certificates or other evidence required by this
provision, such Lender shall not be entitled to any indemnification
under Subparagraph 2.13(a) for any Non-Excluded Taxes imposed on such
Lender primarily as a result of such failure.
(c) Mitigation. If Agent or any Lender claims any
additional amounts to be payable to it pursuant to this Paragraph 2.13,
such Person shall provide to the appropriate Person(s) (or, with
respect to any claim made by any Lender then a party to this Agreement
as a result of the designation of a new Applicable Payment Office by
any Borrower, such Person shall use reasonable commercial efforts to
file) to the extent it may lawfully do so any certificate, forms,
and/or other documents reasonably requested in writing by the
applicable Borrower certifying that such Lender is entitled to receive
a reduced rate of withholding if it is in fact so entitled or to change
the jurisdiction of an Applicable Lending Office if the making of such
a filing or such change in the jurisdiction of an Applicable Lending
Office would avoid the
34
need for or materially reduce the amount of any such additional amounts
which may thereafter accrue and if, in the sole discretion of such
Person, in the case of a change in the jurisdiction of an Applicable
Lending Office, such change would not be disadvantageous to such Person
or contrary to such Person's normal banking practices. Borrowers hereby
agree to pay all reasonable documented costs and expenses incurred by
the Lender in connection with any action taken pursuant to this
Subparagraph 2.13(c). If Agent or any Lender that may lawfully do so
does not provide the requisite certificate(s), form(s), or other
document(s) or change the jurisdiction of its Applicable Lending
Office, if not determined to be
(d) disadvantageous in its sole discretion, then
Borrowers shall not be obligated to pay any additional amounts that
arise from such Agent or Lender's failure to comply with this
Subparagraph 2.13(c).
(e) Tax Returns. Nothing contained in this Paragraph 2.13
or Paragraph 8.03 shall require Agent, any Lender or any of their
respective Affiliates to make available any of its tax returns (or any
other information relating to its taxes which it deems to be
confidential) to any Borrower or any other Person.
(f) Lender Rate Contracts. Nothing contained in this
Paragraph 2.13 shall override or supercede any term or provision of any
Lender Rate Contract regarding withholding taxes relating to Rate
Contracts.
2.14. Funding Loss Indemnification. If any of the Borrowers shall
(a) repay, prepay or convert any LIBOR Loan on any day other than the last day
of an Interest Period therefor (whether a scheduled payment, an optional
prepayment or conversion, a mandatory prepayment or conversion, a payment upon
acceleration or otherwise), (b) fail to borrow any LIBOR Loan after delivering
the Notice of Borrowing therefor to Agent (whether as a result of the failure to
satisfy any applicable conditions or otherwise), (c) pursuant to Paragraph 2.16,
cause the replacement of any Lender that has made or maintained any LIBOR Loan
or (d) fail to pay when due any principal or interest on any LIBOR Loan, such
Borrower shall, within ten (10) Business Days after demand of such Lender,
reimburse such Lender for and hold such Lender harmless from all reasonable
break funding costs and losses incurred by such Lender as a result of such
repayment, prepayment, conversion or failure; provided, however, that Borrowers
shall have no obligation to make any payment to any demanding party under this
Paragraph 2.14 on account of any such costs or losses unless Borrowers receive
notice of such costs or losses from the demanding party within twelve (12)
months after such costs or losses have been incurred or realized. Borrowers
understand that such costs and losses may include losses incurred by a Lender as
a result of funding and other contracts entered into by such Lender to fund a
LIBOR Loan. Each Lender demanding payment under this Paragraph 2.14 shall
deliver to Borrowers, with a copy to Agent, a certificate of an officer of such
demanding party setting forth the amount of costs and losses for which demand is
made, which certificate shall set forth in reasonable detail the calculation of
the amount demanded. Such a certificate so delivered to Borrowers shall
constitute prima facie evidence of such costs and losses. The obligations of
Borrowers under this Paragraph 2.14 shall survive the payment and performance of
the Obligations and the termination of this Agreement.
2.15. Security.
(a) Guaranties, Etc. The Obligations shall be secured by
a Guaranty in the form of Exhibit C (the "Guaranty"), duly executed by
all Eligible Material Subsidiaries and other Subsidiaries of FIL that
have executed the Guaranty or otherwise elected to become a party
thereto, with such changes thereto as may be appropriate based on the
law of the applicable jurisdictions. In addition, on the Closing Date,
FIL shall deliver, or cause to be delivered, to Agent, (A) favorable
written opinions, addressed to Agent for the benefit of the Lenders,
covering such legal matters as Agent and the Lenders may reasonably
request and otherwise in form and substance satisfactory to Agent and
the Lenders, from counsel for each of the above-referenced Subsidiaries
and (B) such other instruments, agreements, certificates and documents
as Agent may reasonably request to secure, maintain, protect and
evidence the obligations of such Subsidiary under the Guaranty.
(b) Changes in Material Subsidiaries.
35
(i) If, at any time after the date of this
Agreement, any Subsidiary of FIL that is not a Guarantor under
the Guaranty shall become an Eligible Material Subsidiary, FIL
promptly shall deliver, or cause to be delivered, to Agent,
within sixty (60) days of becoming aware of any such event,
(A) a Subsidiary Joinder in the form of Attachment 1 to the
Guaranty, appropriately completed and duly executed by such
Subsidiary, and (B) such other instruments, agreements,
certificates, opinions and documents as Agent may reasonably
request to secure, maintain, protect and evidence the
obligations of such Subsidiary under the Guaranty.
(ii) If, at any time after the date of this
Agreement, any Subsidiary of FIL that is a Guarantor under the
Guaranty shall cease to be, or shall not have become, an
Eligible Material Subsidiary by an action or circumstance not
otherwise prohibited by this Agreement, Agent shall, if
requested by FIL, release such Subsidiary from its obligations
under the Guaranty.
(c) Further Assurances. Borrowers shall deliver, and
shall cause the Guarantors to deliver, to Agent such other guaranties,
guaranty supplements and other instruments, agreements, certificates,
opinions and documents as Agent and any Lender may reasonably request
to implement the provisions of Subparagraphs 2.15(a) and (b) and
otherwise to establish, maintain, protect and evidence the rights
provided to Agent, for the benefit of Agents and Lenders, pursuant to
the Security Documents. Borrowers shall fully cooperate with Agent and
Lenders and perform all additional acts reasonably requested by Agent
or any Lender to effect the purposes of this Paragraph 2.15. Without
limiting the generality of the foregoing, FIL covenants and agrees that
it will ensure that the Subsidiaries that have executed and delivered
the Guaranty pursuant to this Agreement and the FIUI Credit Agreement
will have revenues or assets that constitute at least (i) 53% of
consolidated total revenues of FIL or (ii) 60% of consolidated total
assets of FIL, respectively, during each fiscal year of FIL, as
reflected on the most recently delivered annual audited Financial
Statements for FIL.
2.16. Replacement of Lenders. If any Lender shall (a) become a
Defaulting Lender more than one (1) time in a period of twelve (12) consecutive
months, (b) continue as a Defaulting Lender for more than three (3) Business
Days at any time, (c) suspend its obligation to make or maintain LIBOR Loans in
any Currency pursuant to Subparagraph 2.12(b) for a reason which is not
applicable to any other Lender or (d) demand any payment under Subparagraph
2.12(a), 2.12(c) or 2.12(d) for a reason which is not applicable to any other
Lender, then Agent may (or upon the written request of Borrowers, shall) replace
such Lender (the "affected Lender"), or cause such affected Lender to be
replaced, with another lender (the "replacement Lender") satisfying the
requirements of an Assignee Lender under Subparagraph 8.05(c), by having the
affected Lender sell and assign all of its rights and obligations under this
Agreement and the other Credit Documents to the replacement Lender pursuant to
Subparagraph 8.05(c); provided, however, that if Borrowers seek to exercise such
right, they must do so within sixty (60) days after any Borrower first knows or
should have known of the occurrence of the event or events giving rise to such
right, and neither Agent nor any Lender shall have any obligation to identify or
locate a replacement Lender for Borrowers; and provided, further, that no Lender
shall be replaced under this Agreement unless such Lender is also replaced under
the FIUI Credit Agreement. Upon receipt by any affected Lender of a written
notice from Agent stating that Agent is exercising the replacement right set
forth in this Paragraph 2.16, (a) such affected Lender shall sell and assign all
of its rights and obligations under this Agreement and the other Credit
Documents to the replacement Lender pursuant to an Assignment and Assumption and
Subparagraph 8.05(c) for a purchase price equal to the sum of the principal
amount of the affected Lender's Loans so sold and assigned, all accrued and
unpaid interest thereon and its ratable share of all fees to which it is
entitled and (b) Borrowers shall pay any amounts owed to such Lender by
Borrowers under this Agreement.
SECTION III. CONDITIONS PRECEDENT.
3.01. Initial Conditions Precedent. The obligations of the
applicable Lenders to make Loans and of Issuing Bank to issue the initial Letter
of Credit are subject to receipt by Agent, on or prior to the Closing Date, of
each item listed in Schedule 3.01, each in form and substance satisfactory to
Agent and each Lender, and with sufficient copies for, Agent and each Lender.
36
3.02. Conditions Precedent to Each Credit Event. The occurrence of
each Credit Event is subject to the further conditions that:
(a) Borrowers shall have delivered to Agent (and Issuing
Bank, in the case of an LC Application) the Notice of Borrowing or LC
Application, as the case may be, for such Credit Event in accordance
with this Agreement; and
(b) On the date such Credit Event is to occur and after
giving effect to such Credit Event, the following shall be true and
correct:
(i) The representations and warranties of
Borrowers and their Subsidiaries set forth in Paragraph 4.01
and in the other Credit Documents are true and correct in all
material respects as if made on such date (except for
representations and warranties expressly made as of a
specified date, which shall be true as of such date); and
(ii) No Default has occurred and is continuing or
will result from such Credit Event.
The submission by any of the Borrowers to Agent of each Notice of Borrowing and
each LC Application shall be deemed to be a representation and warranty by such
Borrower that each of the statements set forth above in this Subparagraph
3.02(b) is true and correct as of the date of such notice.
3.03. Covenant to Deliver. Borrowers expressly agree that the
occurrence of any such Credit Event prior to the receipt by Agent of any such
item (and Issuing Bank in the case of an LC Application) shall not constitute a
waiver by Agent or any Lender of Borrowers' obligation to deliver such item.
3.04. Conditions Precedent to Adding Designated Borrower. The
obligations of the applicable Lenders to make Loans to any Designated Borrower
or issue any Letters of Credit on behalf of any Designated Borrower are subject
to, on or prior to the date of such designation, the following: (a) receipt by
Agent of each item listed in Schedule 3.01 with respect to such Designated
Borrower, each in form and substance satisfactory to Agent and each Lender, and
with sufficient copies for, Agent and each Lender, (b) execution of an amendment
to this Agreement by each of the parties hereto, whereby Designated Borrower
shall agree to be bound by all of the terms herein and shall designate its
initial Applicable Payment Office, (c) written approval by all Lenders and
Guarantors party to this Agreement and any of the Credit Documents as to the
designation of the Designated Borrower, and (d) execution by Designated Borrower
and FIL of a Subsidiary Joinder to the Guaranty, substantially in the form of
Attachment 1 to Exhibit C hereto.
SECTION IV. REPRESENTATIONS AND WARRANTIES.
4.01. Borrowers' Representations and Warranties. In order to induce
Agent and Lenders to enter into this Agreement, Borrowers hereby represent and
warrant to Agent and Lenders as follows:
(a) Due Incorporation, Qualification, etc. Each of
Borrowers and their Subsidiaries (i) is a corporation duly organized,
validly existing and, in any jurisdiction in which such legal concept
is applicable, in good standing under the laws of its jurisdiction of
organization, (ii) has the power and authority to own, lease and
operate its properties and carry on its business as now conducted and
(iii) is duly qualified and licensed to do business as a foreign
corporation or branch in each jurisdiction where the failure to be so
qualified or licensed is reasonably and substantially likely (alone or
in the aggregate) to have a Material Adverse Effect.
(b) Authority. The execution, delivery and performance by
each of the Borrowers and each Guarantor of each Credit Document
executed, or to be executed, by such Person and the consummation of the
transactions contemplated thereby (i) are within the power of such
Person and (ii) have been duly authorized by all necessary actions on
the part of such Person.
37
(c) Enforceability. Each Credit Document executed, or to
be executed, by each of the Borrowers and each Guarantor has been, or
will be, duly executed and delivered by such Person and constitutes, or
when executed will constitute, a legal, valid and binding obligation of
such Person, enforceable against such Person in accordance with its
terms, except as limited by bankruptcy, insolvency or other laws of
general application relating to or affecting the enforcement of
creditors' rights generally and general principles of equity.
(d) Non-Contravention. The execution and delivery by each
of Borrowers and each Guarantor of the Credit Documents executed by
such Person and the performance and consummation of the transactions
contemplated thereby do not (i) violate any Requirement of Law
applicable to such Person, (ii) violate any provision of, or result in
the breach or the acceleration of, or entitle any other Person to
accelerate (whether after the giving of notice or lapse of time or
both), any Contractual Obligation of such Person or (iii) result in the
creation or imposition of any Lien (or the obligation to create or
impose any Lien) upon any property, asset or revenue of such Person.
(e) Approvals. No consent, approval, order or
authorization of, or registration, declaration or filing with, any
Governmental Authority or other Person (including the shareholders of
any Person) is required in connection with the execution and delivery
of the Credit Documents executed by each of the Borrowers and each
Guarantor and the performance or consummation of the transactions
contemplated thereby, except such as (i) have been made or obtained and
are in full force and effect or (ii) are being made or obtained in a
timely manner and once made or obtained will be in full force and
effect.
(f) No Violation or Default. Neither any Borrower, nor
any Guarantor nor any of FIL's Subsidiaries is in violation of or in
default with respect to (i) any Requirement of Law applicable to such
Person or (ii) any Contractual Obligation of such Person, where, in
each case or in the aggregate, such violation or default is reasonably
and substantially likely to have a Material Adverse Effect. Without
limiting the generality of the foregoing, neither any Borrower, nor any
Guarantor nor any of FIL's Subsidiaries (i) has violated any
Environmental Laws, (ii) to the knowledge of any Borrower, any
Guarantor or any of FIL's Subsidiaries, has any liability under any
Environmental Laws or (iii) has received notice or other communication
of an investigation or, to the knowledge of any Borrower, any Guarantor
or any of FIL's Subsidiaries, is under investigation by any
Governmental Authority having authority to enforce Environmental Laws,
where such violation, liability or investigation is reasonably and
substantially likely (alone or in the aggregate) to have a Material
Adverse Effect. No Default has occurred and is continuing.
(g) Litigation. No actions (including derivative
actions), suits, proceedings or investigations are pending or, to the
knowledge of any Borrower, threatened against any Borrower, any
Guarantor or any of FIL's Subsidiaries at law or in equity in any court
or before any other Governmental Authority which (i) based upon the
written advice of such Person's outside legal counsel, is reasonably
likely to be determined adversely and if so adversely determined is
reasonably and substantially likely (alone or in the aggregate) to have
a Material Adverse Effect or (ii) seeks to enjoin, either directly or
indirectly, the execution, delivery or performance by any Borrower or
any Guarantor of the Credit Documents or the transactions contemplated
thereby.
(h) Title; Possession Under Leases. Each Borrower, each
Guarantor and each of FIL's Subsidiaries own and have good and
indefeasible title, or a valid leasehold interest in, all their
respective material properties and assets as reflected in the most
recent Financial Statements delivered to Agent (except those assets and
properties disposed of in the ordinary course of business or otherwise
in compliance with this Agreement since the date of such Financial
Statements) and all respective material assets and properties acquired
by such Borrower, each Guarantor and FIL's Subsidiaries since such date
(except those disposed of in the ordinary course of business or
otherwise in compliance with this Agreement). Such assets and
properties are subject to no Lien, except for Permitted Liens.
38
(i) Financial Statements. The Financial Statements of FIL
and its Subsidiaries which have been delivered to Agent, (i) are in
accordance with the books and records of FIL and its Subsidiaries,
which have been maintained in accordance with good business practice,
(ii) have been prepared in conformity with GAAP and (iii) fairly
present in all material respects the financial conditions and results
of operations of FIL and its Subsidiaries as of the date thereof and
for the period covered thereby. Neither FIL nor any of its Subsidiaries
has any Contingent Obligations, liability for taxes or other
outstanding obligations which are material in the aggregate, except as
disclosed or reflected in the Financial Statements of FIL dated
December 31, 2003, furnished by FIL to Agent prior to the date hereof,
or in the Financial Statements delivered to Agent pursuant to (i) or
(ii) of Subparagraph 5.01(a), or except as permitted under Section V of
this Agreement.
(j) Employee Benefit Plans.
(i) Based on the latest valuation of each
Employee Benefit Plan that any Borrower or any ERISA Affiliate
maintains or contributes to, or has any obligation under
(which occurred within twelve months of the date of this
representation), the aggregate benefit liabilities of such
plan within the meaning of section 4001 of ERISA did not
materially exceed the aggregate value of the assets of such
plan. Neither any Borrower nor any ERISA Affiliate has any
material liability with respect to any post-retirement benefit
under any Employee Benefit Plan which is a welfare plan (as
defined in section 3(1) of ERISA), other than liability for
health plan continuation coverage described in Part 6 of Title
I(B) of ERISA, which liability for health plan contribution
coverage is not reasonably and substantially likely (alone or
in the aggregate) to have a Material Adverse Effect.
(ii) Each Employee Benefit Plan complies, in both
form and operation, in all material respects, with its terms,
ERISA and the IRC, and no condition exists or event has
occurred with respect to any such plan which would result in
the incurrence by any Borrower or any ERISA Affiliate of any
material liability, fine or penalty. Each Employee Benefit
Plan, related trust agreement, arrangement and commitment of
any Borrower or any ERISA Affiliate is legally valid and
binding and is in all material respects in full force and
effect. No Employee Benefit Plan is being audited or
investigated by any government agency or is subject to any
pending or threatened claim or suit. Neither any Borrower nor
any ERISA Affiliate nor, to the knowledge or any Borrower, any
fiduciary of any Employee Benefit Plan has engaged in a
prohibited transaction under section 406 of ERISA or section
4975 of the IRC.
(iii) Neither any Borrower nor any ERISA Affiliate
contributes to or has any material contingent obligations to
any Multiemployer Plan. Neither any Borrower nor any ERISA
Affiliate has incurred any material liability (including
secondary liability) to any Multiemployer Plan as a result of
a complete or partial withdrawal from such Multiemployer Plan
under section 4201 of ERISA or as a result of a sale of assets
described in section 4204 of ERISA. Neither any Borrower nor
any ERISA Affiliate has been notified that any Multiemployer
Plan is in reorganization or insolvent under and within the
meaning of section 4241 or section 4245 of ERISA or that any
Multiemployer Plan intends to terminate or has been terminated
under section 4041A of ERISA.
(iv) All employer and employee contributions
required by any applicable Governmental Rule in connection
with all Foreign Plans have been made, or, if applicable,
accrued, in all material respects, in accordance with the
country-specific accounting practices. The fair market value
of the assets of each funded Foreign Plan, the liability of
each insurer for any Foreign Plan funded through insurance or
the book reserve established for any Foreign Plan, together
with any accrued contributions, is sufficient, except to the
extent that is not reasonably and substantially likely (alone
or in the aggregate) to have a Material Adverse Effect, to
procure or provide for the accrued benefit obligations, as of
the date hereof, with respect to all current and former
participants in such Foreign Plan according to the actuarial
39
assumptions and valuations most recently used to determine
employer contributions to such Foreign Plan, which actuarial
assumptions are commercially reasonable. Each Foreign Plan
required to be registered has been registered and has been
maintained in good standing with applicable Governmental
Authorities except to the extent that is not reasonably and
substantially likely (alone or in the aggregate) to have a
Material Adverse Effect. Each Foreign Plan reasonably complies
in all material respects with all applicable Governmental
Rules.
(k) Other Regulations. No Borrower or any Material
Subsidiary is subject to regulation under the Investment Company Act of
1940, the Public Utility Holding Company Act of 1935, the Federal Power
Act, the Interstate Commerce Act, any state public utilities code or
any other Governmental Rule that limits its ability to incur
Indebtedness.
(l) Patent and Other Rights. Each Borrower and each of
FIL's Subsidiaries own, license or otherwise have the full right to
use, under validly existing agreements, without known conflict with any
rights of others, all patents, licenses, trademarks, trade names, trade
secrets, service marks, copyrights and all rights with respect thereto,
which are required to conduct their businesses as now conducted, except
such patents, licenses, trademarks, trade names, trade secrets, service
marks, copyrights and all rights with respect thereto which if not
validly owned or used would not be reasonably and substantially likely
(alone or in the aggregate) to have a Material Adverse Effect.
(m) Governmental Charges. Each Borrower and each of FIL's
Subsidiaries have filed or caused to be filed all material tax returns,
reports and declarations which are required to be filed by them. Each
Borrower and each of FIL's Subsidiaries have paid, or made provision
for the payment of, all taxes and other Governmental Charges which have
or may have become due pursuant to said returns or otherwise and all
other indebtedness, except such Governmental Charges or indebtedness,
if any, which are being contested in good faith and as to which
adequate reserves (determined in accordance with GAAP) have been
provided or which are not reasonably and substantially likely (alone or
in the aggregate) to have a Material Adverse Effect if unpaid.
(n) Margin Stock. No Borrower owns any Margin Stock
which, in the aggregate, would constitute a substantial part of the
assets of such Borrower, and no proceeds of any Loan and no Letter of
Credit will be used to purchase or carry, directly or indirectly, any
Margin Stock or to extend credit, directly or indirectly, to any Person
for the purpose of purchasing or carrying any Margin Stock.
(o) Subsidiaries, Etc. Schedule 4.01(o) (on the Closing
Date as of December 31, 2003 and as thereafter updated on a quarterly
basis by Borrowers in a written notice to Agent no later than the date
Financial Statements are required to be delivered pursuant to
Subparagraph 5.01(a)) sets forth each of FIL's Significant Subsidiaries
and Material Subsidiaries, its jurisdiction of organization, the
percentages of shares owned directly or indirectly by FIL and whether
FIL owns such shares directly or, if not, the Subsidiary of FIL that
owns such shares.
(p) Solvency, Etc. Each of the Borrowers, each Guarantor
and each Material Subsidiary is Solvent and, after the execution and
delivery of the Credit Documents and the consummation of the
transactions contemplated thereby, will be Solvent.
(q) Senior Debt. Borrowers have taken all actions
necessary for the Obligations to constitute "Designated Senior Debt"
for the purposes of and as defined in the Subordinated Indenture.
(r) No Withholding, Etc. Except as otherwise disclosed by
a Borrower to the Agent from time to time, no Borrower has actual
knowledge of any requirement under any Governmental Rule to make any
deduction or withholding of any nature whatsoever from any payment
required to be made by any Borrowers hereunder or under any other
Credit Document. Neither this Agreement nor any of the other Credit
Documents is subject to any registration or stamp tax or any other
similar or like taxes payable in any relevant jurisdiction.
40
(s) Foreign Subsidiaries.
(i) No Immunities, etc. Each Foreign Subsidiary
that is a Borrower or Guarantor is subject to civil and
commercial law with respect to its obligations under this
Agreement and the other Credit Documents, and the execution,
delivery and performance by each such Foreign Subsidiary of
this Agreement and the other Credit Documents constitute and
will constitute private and commercial acts and not public or
governmental acts. Neither such Foreign Subsidiary nor any of
its property, whether or not held for its own account, has any
immunity (sovereign or other similar immunity) from any suit
or proceeding, from jurisdiction of any court or, if
applicable in the relevant jurisdiction, from set-off or any
legal process (whether service or notice, attachment prior to
judgment, attachment in aid of execution of judgment,
execution of judgment or other similar immunity) under laws of
the jurisdiction in which such Foreign Subsidiary is organized
and existing in respect of its obligations under this
Agreement and the other Credit Documents. Each such Foreign
Subsidiary has waived every immunity (sovereign or otherwise)
to which it or any of its properties would otherwise be
entitled from any legal action, suit or proceeding, from
jurisdiction of any court and from set-off or any legal
process (whether service or notice, attachment prior to
judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) under the laws of the
jurisdiction in which such Foreign Subsidiary is organized and
existing in respect of its obligations under this Agreement
and the other Credit Documents. The waiver by each such
Foreign Subsidiary described in the immediately preceding
sentence is the legal, valid and binding obligation of such
Foreign Subsidiary.
(ii) No Recordation Necessary. This Agreement and
each of the other Credit Documents executed by a Foreign
Subsidiary is in proper legal form under the law of the
jurisdiction in which such Foreign Subsidiary is organized and
existing for the enforcement hereof or thereof against such
Foreign Subsidiary under the law of such jurisdiction, and to
ensure the legality, validity, enforceability, priority or
admissibility in evidence of this Agreement and such other
Credit Documents. It is not necessary to ensure the legality,
validity, enforceability, priority or admissibility in
evidence of this Agreement or any other Credit Document
executed by a Foreign Subsidiary that this Agreement, any
other Credit Document or any other document be filed,
registered or recorded with, or executed or notarized before,
any court or other authority in the jurisdiction in which such
Foreign Subsidiary is organized and existing or that any
registration charge or stamp or similar tax be paid on or in
respect of this Agreement, any other Credit Document or any
other document, except for any such filing, registration or
recording, or execution or notarization, as has been made or
is not required to be made until this Agreement, any other
Credit Document or any other document is sought to be enforced
and for any charge or tax as has been timely paid.
(iii) Exchange Controls. The execution, delivery
and performance by each Borrower of this Agreement and each of
the other Credit Documents executed by a Foreign Subsidiary
is, under applicable foreign exchange control regulations of
the jurisdiction in which each such Borrower or Foreign
Subsidiary is organized and existing, not subject to any
notification or authorization except (A) such as have been
made or obtained or (B) such as cannot be made or obtained
until a later date and are listed on Schedule 4.01(s) hereto
(provided any notification or authorization described in
immediately preceding clause (B) shall be made or obtained as
soon as is reasonably practicable).
(t) No Material Adverse Effect. No event has occurred and
no condition exists which, alone or in the aggregate, (i) has had (and
continues to have) or (ii) is reasonably and substantially likely to
have a Material Adverse Effect.
(u) Accuracy of Information Furnished. The Credit
Documents and the other certificates, statements and information
(excluding projections) furnished to Agent or any Lender by or on
behalf of Borrowers, the Guarantors and FIL's Subsidiaries in
connection with the Credit Documents and the transactions contemplated
thereby, taken as a whole, do not contain and will not contain any
untrue
41
statement of a material fact and do not omit and will not omit to state
a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. All
projections have been based upon reasonable assumptions and represent,
as of their respective dates of presentations, Borrowers' best
estimates of the future performance of Borrowers, the Guarantors and
FIL's Subsidiaries.
4.02. Reaffirmation. Each Borrower shall be deemed to have
reaffirmed, for the benefit of the Lenders and Agent, each representation and
warranty contained in Paragraph 4.01 on and as of the date of each Credit Event
(except for representations and warranties expressly made as of a specified
date, which shall be true as of such date).
SECTION V. COVENANTS.
5.01. Affirmative Covenants. Until the termination of this Agreement
and the satisfaction in full by Borrowers of all Obligations, Borrowers will
comply, and will cause compliance by each Subsidiary, with the following
affirmative covenants, unless Required Lenders shall otherwise consent in
writing:
(a) Financial Statements, Reports, etc. Each Borrower
shall furnish to Agent the following, each in such form and such detail
as Agent or the Required Lenders shall reasonably request:
(i) As soon as available and in no event later
than fifty-five (55) days after the last day of each fiscal
quarter of FIL, a copy of the Financial Statements of FIL and
its Subsidiaries (prepared on a consolidated basis) for such
quarter and for the fiscal year to date, certified by the
chief executive officer, chief operating officer, chief
financial officer, treasurer, assistant treasurer, controller
or senior vice president of finance of FIL to present fairly
in all material respects the financial condition, results of
operations and other information reflected therein and to have
been prepared in accordance with GAAP (subject to normal
year-end audit adjustments);
(ii) As soon as available and in no event later
than one hundred (100) days after the close of each fiscal
year of FIL, (A) copies of the audited Financial Statements of
FIL (prepared on a consolidated and consolidating basis) for
such year, audited by independent certified public accountants
of recognized national standing reasonably acceptable to
Agent, (B) copies of the unqualified opinions (or qualified
opinions (other than a "going concern" or like qualification
or exception or any qualification or exception as to the scope
of such audit) reasonably acceptable to Agent) of such
accountants and (C) if available from such accountants,
certificates of such accountants to Agent stating that in
making the examination necessary for their opinion they have
reviewed this Agreement and have obtained no knowledge of any
Default which has occurred and is continuing, or if, in the
opinion of such accountants, a Default has occurred and is
continuing, a statement as to the nature thereof;
(iii) Contemporaneously with the quarterly and
year-end Financial Statements required by the foregoing
clauses (i) and (ii), a compliance certificate of the chief
executive officer, chief operating officer, chief financial
officer, treasurer, assistant treasurer, controller or senior
vice president of finance of Borrower (a "Compliance
Certificate") that (A) states that no Default has occurred and
is continuing, or, if any such Default has occurred and is
continuing, a statement as to the nature thereof and what
action Borrowers propose to take with respect thereto, and (B)
sets forth, for the quarter or year covered by such Financial
Statements or as of the last day of such quarter or year (as
the case may be), the calculation of the financial ratios and
tests provided in Paragraph 5.03;
(iv) As soon as possible and in no event later
than five (5) Business Days after any officer of such Borrower
knows of the occurrence or existence of (A) any Reportable
Event under any Employee Benefit Plan or Multiemployer Plan,
(B) any actual or threatened litigation, suits, claims or
disputes against any Borrower or any of FIL's Subsidiaries
involving potential monetary damages payable by any Borrower
or FIL's Subsidiaries of Ten Million Dollars ($10,000,000) or
42
more (alone or in the aggregate), (C) any other event or
condition which is reasonably and substantially likely (alone
or in the aggregate) to have a Material Adverse Effect, (D)
any Default or (E) any event of the type described in
Subparagraph 6.01(f) or (g) with respect to any Subsidiary, so
long as such Subsidiary is determined at the time of such
event to be a Significant Subsidiary, the statement of the
chief executive officer, chief operating officer, chief
financial officer, treasurer, assistant treasurer, controller
or senior vice president of finance of such Borrower setting
forth details of such event, condition or Default and the
action which such Borrower proposes to take with respect
thereto;
(v) As soon as available and in no event later
than five (5) Business Days after they are sent, made
available or filed, copies of (A) all registration statements
and reports filed by any of the Borrowers or any of FIL's
Subsidiaries with the United States Securities and Exchange
Commission (including all 10-Q, 10-K and 8-K reports) and (B)
all reports, proxy statements and financial statements sent or
made available by any of the Borrowers or any of FIL's
Subsidiaries to its security holders;
(vi) As soon as possible and in no event later
than (A) fifty-five (55) days after the last day of each
fiscal quarter (or one hundred (100) days in the case of the
last fiscal quarter of each fiscal year), written notice of
any new Significant Subsidiary acquired or established during
such quarter or any other change in the information set forth
in Schedule 4.01(o) during such quarter and (B) ten (10) days
after the date that any entity becomes a Material Subsidiary,
written notice setting forth each Subsidiary of FIL that has
become a Material Subsidiary and indicating for each such new
Material Subsidiary whether such Material Subsidiary is an
Eligible Material Subsidiary or Ineligible Material
Subsidiary;
(vii) As soon as available and in no event later
than five (5) Business Days after any Borrower changes its
legal name or the address of its chief executive office,
written notice setting forth such Borrower's new legal name
and/or new address; and
(viii) Such other instruments, agreements,
certificates, opinions, statements, documents and information
relating to the operations or condition (financial or
otherwise) of such Borrower or FIL's Subsidiaries, and
compliance by such Borrower with the terms of this Agreement
and the other Credit Documents as Agent on behalf of itself or
one or more Lenders may from time to time reasonably request.
In lieu of furnishing to Agent hard copies of the quarterly Financial
Statements described in clause (i) above and the annual Financial
Statements and auditor's report described in clauses (ii)(A) and
(ii)(B) above and the other documents referred to in clause (v) above,
FIL may make such documents available to Lenders by posting such
documents on its website located at xxx.xxxxxxxxxxx.xxx and through the
United States Securities and Exchange Commission's XXXXX system
("XXXXX") or by transmitting such documents electronically to Lenders.
FIL shall provide to any Lender hard copies of such documents upon
request if such Lender does not have access to FIL's website or XXXXX.
(b) Books and Records. Each Borrower and FIL's
Subsidiaries shall at all times keep proper books of record and account
which shall be complete and correct in all material respects in
accordance with GAAP.
(c) Inspections. Each Borrower and FIL's Subsidiaries
shall permit Agent and each Lender, or any agent or representative
thereof, upon reasonable notice and during normal business hours, to
visit and inspect any of the properties and offices of such Borrower
and FIL's Subsidiaries, to examine the books and records of such
Borrower and FIL's Subsidiaries and make copies thereof and to discuss
the affairs, finances and business of such Borrower and FIL's
Subsidiaries with, and to be advised as to the same by, their officers,
auditors and accountants, all at such times and intervals as Agent or
any Lender may reasonably request (which visits and inspections shall
be at the expense of Agent or such Lender unless a Default has occurred
and is continuing).
43
(d) Insurance. Each Borrower and FIL's Subsidiaries shall
(i) carry and maintain insurance of the types and in the amounts
customarily carried from time to time during the term of this Agreement
by others engaged in substantially the same business as such Person and
operating in the same geographic area as such Person, including fire,
public liability, property damage and worker's compensation, (ii) carry
and maintain each policy for such insurance with financially sound
insurers and (iii) deliver to Agent from time to time, as Agent may
request, schedules setting forth all insurance then in effect.
(e) Taxes, Governmental Charges and Other Indebtedness.
Each Borrower and FIL's Subsidiaries shall promptly pay and discharge
when due (i) all taxes and other Governmental Charges prior to the date
upon which penalties accrue thereon, (ii) all indebtedness which, if
unpaid, could become a Lien upon the property of such Borrower or FIL's
Subsidiaries and (iii) subject to any subordination provisions
applicable thereto, all other Indebtedness, which in each case or in
the aggregate, if unpaid, is reasonably and substantially likely to
have a Material Adverse Effect, except such taxes, Governmental Charges
or Indebtedness as may in good faith be contested or disputed, or for
which arrangements for deferred payment have been made, provided that
in each such case appropriate reserves are maintained in accordance
with GAAP.
(f) Use of Proceeds. Each Borrower shall use the proceeds
of the Loans and Letters of Credit only for the purposes set forth in
Section II. No Borrower shall use any part of the proceeds of any Loan
or any Letter of Credit, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock or for the purpose of
purchasing or carrying or trading in any securities under such
circumstances as to involve such Borrower, any Lender or Agent in a
violation of Regulations T, U or X issued by the Federal Reserve Board.
(g) General Business Operations. Each of the Borrowers
and FIL's Subsidiaries shall (i) preserve and maintain its corporate
existence and all of its rights, privileges and franchises reasonably
necessary to the conduct of its business, (ii) conduct its business
activities in compliance with all Requirements of Law and Contractual
Obligations applicable to such Person and (iii) keep all property
useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted, except, in each case, where
any failure is not reasonably and substantially likely (alone or in the
aggregate) to have a Material Adverse Effect.
(h) Pari Passu Ranking. Each Borrower shall take, or
cause to be taken, all actions necessary to ensure that the Obligations
of such Borrower are and continue to rank at least pari passu in right
of payment with all other unsecured and unsubordinated Indebtedness of
such Borrower.
(i) Designated Senior Debt. Borrowers shall take all
additional actions that may be necessary for the Obligations to
continue at all times to constitute "Designated Senior Debt" or
otherwise to be entitled to all the benefits of being "senior debt"
under each Subordinated Indenture for so long as any Indebtedness shall
be outstanding under any such Subordinated Indenture.
(j) Patriot Act. Promptly following a request therefor,
each Borrower shall provide all documentation and other information
that a Lender reasonably requests in order to comply with such Lender's
ongoing obligations under applicable "know your customer" and
anti-money laundering rules and regulations, including the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (known as the USA Patriot
Act), provided that any Lender requesting documentation or other
information under this Subparagraph 5.01(j) shall provide any relevant
supporting documentation reasonably requested by any Borrower
responding to such request.
(k) Flextronics Hungaria Kft. In the event that (x)
Flextronics Hungaria Kft has not been liquidated or dissolved and (y)
all or substantially all of the assets of Flextronics Hungaria Kft have
not been transferred to Flextronics Cyprus Limited by June 30, 2004,
then, within five (5) Business Days of such date, Borrowers shall cause
Flextronics Hungaria Kft to (i) complete and execute a Subsidiary
Joinder
44
and (ii) deliver or cause to be delivered such other instruments,
agreements, certificates, opinions and documents as Agent may
reasonably request.
5.02. Negative Covenants. Until the termination of this Agreement
and the satisfaction in full by Borrowers of all Obligations, Borrowers will
comply, and will cause compliance, with the following negative covenants, unless
Required Lenders shall otherwise consent in writing:
(a) Indebtedness. None of the Borrowers or any of FIL's
Subsidiaries shall create, incur, assume or permit to exist any
Indebtedness except for the following ("Permitted Indebtedness"):
(i) Indebtedness created under the Credit
Documents;
(ii) Indebtedness that is not secured by a Lien
in any asset or property of any of the Borrowers or any of
FIL's Subsidiaries;
(iii) (A) Indebtedness under Capital Leases or
under purchase money loans incurred by Borrower or any of
FIL's Subsidiaries to finance the acquisition, construction,
development or improvement by such Person of real property,
fixtures, inventory or equipment or other tangible assets,
provided that in each case (1) such Indebtedness is incurred
by such Person at the time of, or not later than one hundred
twenty (120) days after, the acquisition by such Person of the
property so financed and (2) such Indebtedness does not exceed
the purchase price of the property (or the cost of
constructing, developing or improving the same) so financed,
and (B) Indebtedness under initial or successive refinancings
of any such Capital Leases or purchase money loans, provided
that the principal amount of any such refinancing does not
exceed the principal amount of the Indebtedness being
refinanced;
(iv) Existing Secured Indebtedness, together with
initial or successive refinancings thereof, provided that (A)
the principal amount of any such refinancing does not exceed
the principal amount of the Indebtedness being refinanced
(except to the extent necessary to pay fees, expenses,
underwriting discounts and prepayment penalties in connection
therewith) and (B) the other terms and provisions of any such
refinancing with respect to maturity, redemption, prepayment,
default and subordination are no less favorable in any
material respect to Lenders than the Indebtedness being
refinanced;
(v) Indebtedness of any Borrower or Guarantor to
any other Borrower or any Eligible Material Subsidiary or
Indebtedness of any Eligible Material Subsidiary to any
Borrower or any other Eligible Material Subsidiary or any
Guarantor, in each case to the extent otherwise permitted
pursuant to Subparagraph 5.02(e) and Subparagraph 5.02(i); and
(vi) Other Indebtedness that is secured by a Lien
on any assets or property of any of the Borrowers or any of
FIL's Subsidiaries, provided that the aggregate principal
amount of all secured Indebtedness (other than Existing
Secured Indebtedness or Indebtedness secured by cash or cash
equivalents to the extent such cash or cash equivalents are
proceeds of such Indebtedness) and secured Rate Contracts
(whether or not constituting "Indebtedness") outstanding
during any fiscal quarter of FIL does not exceed the greater
of (i) Seven Hundred Fifty Million Dollars ($750,000,000) or
(ii) ten percent (10%) of Consolidated Tangible Assets on the
last day of the immediately preceding fiscal quarter, and
provided, further, that for purposes of this Subparagraph
5.02(a)(vi) only, the "principal amount" of the obligations of
any Person in respect of any Rate Contract at any time shall
be in the maximum aggregate amount (giving effect to any
netting agreements), if any, that such Person would be
required to pay if such Rate Contract were terminated at such
time.
45
(b) Liens. None of the Borrowers or any of FIL's
Subsidiaries shall create, incur, assume or permit to exist any Lien on
or with respect to any of their assets or property of any character,
whether now owned or hereafter acquired, except for the following Liens
("Permitted Liens"):
(i) Liens that secure only Indebtedness which
constitutes Permitted Indebtedness under clause (iii) (but
only to the extent such Liens are on the assets so financed,
the proceeds thereof and any improvements thereon), (iv), (v)
or (vi) of Subparagraph 5.02(a) and Liens that secure Rate
Contracts that do not constitute Indebtedness, provided that
the aggregate principal amount of Indebtedness that
constitutes Permitted Indebtedness under clause (vi) of
Subparagraph 5.02(a) and secured Rate Contracts that do not
constitute Indebtedness shall not exceed the amount set forth
in Subparagraph 5.02(a)(vi);
(ii) Liens in favor of any of the Borrowers, any
Eligible Material Subsidiary or any Guarantor on all or part
of the assets of Subsidiaries of any Borrower, any Eligible
Material Subsidiary or any Guarantor securing Indebtedness
owing by Subsidiaries of any of the Borrowers, Eligible
Material Subsidiary or any Guarantor, as the case may be, to
any of the Borrowers or to such other Eligible Material
Subsidiary or Guarantor;
(iii) Liens to secure taxes, assessments and other
government charges in respect of obligations not overdue or
Liens on properties to secure claims for labor, material or
supplies in respect of obligations not overdue (taking into
account applicable grace periods) or which are being contested
in good faith by appropriate proceedings diligently conducted
and with respect to which adequate reserves are being
maintained in accordance with GAAP so long as such Liens are
not being foreclosed;
(iv) deposits or pledges made in connection with,
or to secure payment of, workmen's compensation, unemployment
insurance, old age pensions or other social security
obligations and good faith deposits in connection with
tenders, contracts or leases to which any Borrower or any
Subsidiary is a party or deposits or pledges to secure, or in
lieu of, surety, penalty or appeal bonds, performance bonds or
other similar obligations;
(v) Liens of carriers, landlords, warehousemen,
mechanics and materialmen, and other like Liens on properties
which would not have a Material Adverse Effect and are in
respect of obligations not overdue (taking into account
applicable grace periods), or which are being contested in
good faith by appropriate proceedings diligently conducted and
with respect to which adequate reserves are being maintained
in accordance with GAAP so long as such Liens are not being
foreclosed;
(vi) encumbrances on real property consisting of
easements, rights of way, zoning restrictions, restrictions on
the use of real property and defects and irregularities in the
title thereto, landlord's or lessor's or lessee's Liens under
leases to which a Borrower or any of FIL's Subsidiaries is a
party (including "synthetic" leases), and other minor Liens or
encumbrances none of which interferes materially with the use
of the property, in each case which do not individually or in
the aggregate have a Material Adverse Effect;
(vii) Liens in favor of the Agent for the benefit
of the Lenders and the Agent under the Credit Documents;
(viii) Liens in favor of the agent for the benefit
of the lenders and the agent under the FIUI Credit Documents;
(ix) Liens arising out of cash management,
netting or set off arrangements made between banks or
financial institutions and FIL or any of its Subsidiaries in
the ordinary course of
46
business, or over any asset held with a clearing house, or
other Liens comprising rights of set-off arising by operation
of law or by agreement;
(x) Liens securing Indebtedness or other
obligations on cash or cash equivalents to the extent such
cash or cash equivalents represent proceeds from such
Indebtedness or other obligations;
(xi) rights of third parties in equipment or
inventory consigned to or by, or otherwise owned by such third
party and which is being stored on property owned or leased
by, a Borrower or any of FIL's Subsidiaries;
(xii) Liens created pursuant to attachment,
garnishee orders or other process in connection with
pre-judgment court proceedings; and
(xiii) precautionary Liens over assets securitized
in connection with any securitized transaction permitted under
Subparagraph 5.02 (c).
(c) Asset Dispositions. None of the Borrowers or any of
FIL's Subsidiaries shall sell, lease, transfer or otherwise dispose of
any of their assets or property, whether now owned or hereafter
acquired, except for (i) assets or property sold, leased, transferred
or otherwise disposed of in the ordinary course of business for fair
market value, (ii) sales of accounts receivable in securitization or
financing transactions, provided that the aggregate principal amount of
any accounts receivable sold in any fiscal quarter of FIL shall not
exceed thirty percent (30%) of the aggregate principal amount of
accounts receivable originated by FIL and its Subsidiaries during such
fiscal quarter, (iii) sales or transfers of duplicative or excess
assets existing as a result of transactions otherwise permitted
pursuant to Subparagraph 5.02(d), provided that the aggregate principal
amount of any such duplicative assets sold or transferred in any fiscal
year does not exceed five percent (5%) of all fixed assets (net of
depreciation) held by FIL and its Subsidiaries as of the end of the
immediately preceding fiscal quarter, (iv) sales or transfers of
damaged, obsolete or worn out assets and scrap, in each case in the
ordinary course of business, (v) sales or transfers of assets or
property to any Borrower or any Subsidiary from any other Borrower or
Subsidiary, (vi) assets sold and leasedback by FIL or its Subsidiaries
in the ordinary course of business and (vii) dispositions of
Investments permitted under Subparagraph 5.02(e) for a purchase price
that is not less than fair market value of the Investments being sold.
(d) Mergers, Acquisitions, Etc. None of the Borrowers or
any of FIL's Subsidiaries shall consolidate with or merge into any
other Person or permit any other Person to merge into them, acquire any
Person as a new Subsidiary or acquire all or substantially all of the
assets of any other Person, except for the following:
(i) Borrowers and FIL's Subsidiaries may merge
with each other, provided that (A) (1) in any such merger
involving any Borrower, such Borrower is the surviving
corporation and (2) in any such merger involving a Guarantor,
the surviving corporation becomes a Guarantor and (B) in each
case, no Default has occurred and is continuing on the date
of, or will result after giving effect to, any such merger;
and
(ii) Borrowers and FIL's Subsidiaries may acquire
any Person as a new Subsidiary or of all or substantially all
of the assets of any Person, provided that:
(A) No Default has occurred and is
continuing on the date of, or will result after
giving effect to, any such acquisition;
(B) Such Person is not primarily
engaged in any business substantially different from
(1) the present business of the acquiring Borrower or
Subsidiary or (2) any business reasonably related
thereto; and
47
(C) Borrowers or FIL's Subsidiaries
possess the power to direct or cause the direction of
the management and policies of such Person.
(e) Investments. None of the Borrowers or any of FIL's
Subsidiaries shall make any Investment except for the following:
(i) Investments permitted by the investment
policy of FIL set forth in Schedule 5.02(e) or, if any changes
to the investment policy of FIL are hereafter duly approved by
the Board of Directors of FIL, in any subsequent investment
policy which is the most recent investment policy delivered by
FIL to Agent with a certificate of FIL's chief financial
officer to the effect that such investment policy has been
duly approved by FIL's Board of Directors and is then in
effect;
(ii) Investments (x) listed in Schedule 5.02(e)
or (y) in Wholly-Owned Subsidiaries, in each case existing or
committed on the Closing Date;
(iii) Investments received by Borrowers and FIL's
Subsidiaries in connection with the bankruptcy or
reorganization of customers and suppliers and in settlement of
delinquent obligations of, and other disputes with, customers
and suppliers arising in the ordinary course of business;
(iv) Investments by Borrowers, the Material
Subsidiaries and the Guarantors directly or indirectly in each
other;
(v) Investments consisting of loans to employees
and officers for travel, housing, relocation and other similar
expenses incurred in the ordinary course of business;
(vi) Investments of Borrowers and FIL's
Subsidiaries in interest rate protection, currency swap and
foreign exchange arrangements, provided that all such
arrangements are entered into in connection with bona fide
hedging operations and not for speculation;
(vii) Deposit accounts;
(viii) Investments permitted by Subparagraph
5.02(d);
(ix) Other Investments, provided that:
(A) No Default has occurred and is
continuing on the date of, or will result after
giving effect to, any such Investment; and
(B) The aggregate consideration paid by
Borrowers and FIL's Subsidiaries for all such
Investments pursuant to this clause (ix) in any
fiscal year (without duplication) does not exceed the
sum of (1) ten percent (10%) of the total assets of
FIL and its Subsidiaries at the end of the
immediately preceding fiscal quarter, plus (2)
seventy-five percent (75%) of the Net Proceeds
received from the issuance by FIL of any Equity
Securities of the type described in clause (a) of the
definition of "Equity Securities" during calendar
year 2001 or thereafter.
(f) Dividends, Redemptions, Etc. None of the Borrowers or
any of FIL's Subsidiaries shall (i) pay any dividends or make any
distributions (whether in cash, securities or other property) on its
Equity Securities, including any payment to a sinking fund or similar
deposit, (ii) purchase, redeem, retire, defease, cancel, terminate, or
otherwise acquire for value any of its Equity Securities, (iii) return
any capital to any holder of its Equity Securities as such or (iv) make
any distribution of assets, Equity Securities, obligations,
48
cash or securities to any holder of its Equity Securities as such, or
set apart any sum for any such purpose, except as follows:
(i) Any of the Borrowers or any of FIL's
Subsidiaries may pay dividends on its capital stock payable
solely in such Person's own capital stock, provided that, in
the case of any such dividend payable by an Ineligible
Material Subsidiary, such dividend is delivered and pledged to
Agent to the extent required by Subparagraph 2.15(b);
(ii) Any Subsidiary of FIL may pay dividends to
or repurchase its capital stock from such Subsidiary's parent;
and
(iii) FIL may pay dividends on its capital stock
payable in cash or repurchase its capital stock for cash,
provided that, in each case, no Default has occurred and is
continuing on the date of, or will result after giving effect
to, any such payment or repurchase.
(g) Change in Business. None of the Borrowers or any of
FIL's Subsidiaries shall engage to any material extent, either directly
or indirectly, in any business substantially different from (i) their
present business or (ii) any business reasonably related thereto.
(h) Employee Benefit Plans.
(i) None of the Borrowers or any ERISA Affiliate
shall (A) adopt or institute any Employee Benefit Plan that is
an employee pension benefit plan within the meaning of section
3(2) of ERISA, (B) take any action which will result in the
partial or complete withdrawal, within the meanings of
sections 4203 and 4205 of ERISA, from a Multiemployer Plan,
(C) engage or permit any Person to engage in any transaction
prohibited by section 406 of ERISA or section 4975 of the IRC
involving any Employee Benefit Plan or Multiemployer Plan
which would subject any Borrower or any ERISA Affiliate to any
tax, penalty or other liability including a liability to
indemnify, (D) incur or allow to exist any accumulated funding
deficiency (within the meaning of section 412 of the IRC or
section 302 of ERISA), (E) fail to make full payment when due
of all amounts due as contributions to any Employee Benefit
Plan or Multiemployer Plan, (F) fail to comply with the
requirements of section 4980B of the IRC or Part 6 of Title
I(B) of ERISA, or (G) adopt any amendment to any Employee
Benefit Plan which would require the posting of security
pursuant to section 401(a)(29) of the IRC, where singly or
cumulatively, the above would be reasonably and substantially
likely to have a Material Adverse Effect.
(ii) None of the Borrowers or any of FIL's
Subsidiaries shall (A) engage in any transaction prohibited by
any Governmental Rule applicable to any Foreign Plan, (B) fail
to make full payment when due of all amounts due as
contributions to any Foreign Plan or (C) otherwise fail to
comply with the requirements of any Governmental Rule
applicable to any Foreign Plan, where singly or cumulatively,
the above would be reasonably and substantially likely to have
a Material Adverse Effect.
(i) Transactions With Affiliates. None of the Borrowers
or any of FIL's Subsidiaries shall enter into any Contractual
Obligation with any Affiliate (other than one of the Borrowers or one
of its Subsidiaries) or engage in any other transaction with any such
Affiliate except (A) upon terms at least as favorable to such Borrower
or such Subsidiary as an arms-length transaction with unaffiliated
Persons, except as disclosed or reflected in the Financial Statements
of FIL dated December 31, 2003, furnished by FIL to Agent prior to the
date hereof, or in the Financial Statements delivered to Agent pursuant
to clause (i) or (ii) of Subparagraph 5.01(a), or (B) in connection
with transactions made pursuant to Subparagraphs 5.02(d) or 5.02(e).
49
(j) Accounting Changes. None of the Borrowers or any of
FIL's Subsidiaries shall change (i) their fiscal year (currently April
1 through March 31) or (ii) their accounting practices except as
required by GAAP.
(k) Burdensome Contractual Obligations. None of the
Borrowers or any of FIL's Subsidiaries will enter into any Contractual
Obligation (excluding this Agreement and the other Credit Documents)
that restricts the ability of any wholly-owned Subsidiary of FIL or any
other Subsidiary of FIL that had revenues during the immediately
preceding fiscal year equal to or greater than Twenty-Five Million
Dollars ($25,000,000) or net worth on the last day of the immediately
preceding fiscal year equal to or greater than Twenty-Five Million
Dollars ($25,000,000), to pay or make dividends or distributions in
cash or kind, to make loans, advances or other payments of whatsoever
nature or to make transfers or distributions of all or any part of
their assets to any of the Borrowers or to any Subsidiary of such
Subsidiary; provided, however, that the foregoing shall not apply to
(i) restrictions or conditions imposed by any Governmental Rule or (ii)
customary restrictions and conditions (A) contained in licenses, leases
and franchise agreements or (B) relating to the sale of a Subsidiary
pending such sale so long as such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is otherwise
permitted hereunder.
(l) Senior Debt. None of the Borrowers or any of FIL's
Subsidiaries will designate or permit to exist any other Indebtedness
as "Designated Senior Debt" for the purposes of and as defined in each
Subordinated Indenture, other than the Obligations arising under this
Agreement and the other Credit Documents and obligations arising under
facilities providing at least Fifty Million Dollars ($50,000,000) in
the aggregate of loans or other debt or synthetic lease financing.
5.03. Financial Covenants. Until the termination of this Agreement
and the satisfaction in full by Borrowers of all Obligations, Borrowers will
comply, and will cause compliance, with the following financial covenants,
unless Required Lenders shall otherwise consent in writing:
(a) Debt/EBITDA Ratio. FIL shall not permit its
Debt/EBITDA Ratio as of any date set forth below to exceed the ratio
set forth opposite such date:
Date Ratio
---- -----
March 31, 2004 3.50 : 1.00
June 30, 2004 3.50 : 1.00
September 30, 2004 3.50 : 1.00
December 31, 2004 3.50 : 1.00
March 31, 2005 3.50 : 1.00
June 30, 2005 3.50 : 1.00
September 30, 2005 3.50 : 1.00
December 31, 2005 3.50 : 1.00
March 31, 2006 3.25 : 1.00
June 30, 2006 3.25 : 1.00
September 30, 2006 3.25 : 1.00
December 31, 2006 3.25 : 1.00
March 31, 2007 3.25 : 1.00
50
Date Ratio
---- -----
June 30, 2007 3.25 : 1.00
September 30, 2007 3.25 : 1.00
December 31, 2007 3.25 : 1.00
(b) Fixed Charge Coverage Ratio. FIL shall not permit its
Fixed Charge Coverage Ratio to be less than 1.50 to 1.00 for any
consecutive four-quarter period ending on the last day of any fiscal
quarter.
SECTION VI. DEFAULT.
6.01. Events of Default. The occurrence or existence of any one or
more of the following shall constitute an "Event of Default" hereunder:
(a) Non-Payment. Any Borrower shall (i) fail to pay when
due any principal of any Loan or any Reimbursement Payment or (ii)
except at the Maturity Date, when no grace period shall apply, fail to
pay within five (5) Business Days after the same becomes due any
interest, fee or other payment required under the terms of this
Agreement or any of the other Credit Documents; or
(b) Specific Defaults. Any Borrower or any of FIL's
Subsidiaries shall fail to observe or perform any covenant, obligation,
condition or agreement set forth in Paragraph 5.02 or Paragraph 5.03;
or
(c) Other Defaults. Any Borrower or any of FIL's
Subsidiaries shall fail to observe or perform any other covenant,
obligation, condition or agreement contained in this Agreement or the
other Credit Documents and such failure shall continue for thirty (30)
Business Days after the earlier of (i) any Borrower's written
acknowledgement of such failure and (ii) Agent's or any Lender's
written notice to Borrowers of such failure; provided, however, that in
the event that such failure cannot reasonably be cured within such
thirty (30) day period, and such failure relates to the observance or
performance of any of the covenants, obligations, conditions or
agreements contained in Subparagraph 4.01(f) hereof with respect to
Hazardous Materials or any Environmental Laws or any judgment, consent
decree, settlement or compromise in respect of any claim based thereon,
it shall not constitute an Event of Default hereunder so long as
Borrowers shall have commenced to cure such failure within such thirty
(30) day period and shall thereafter diligently pursue such cure to
completion, and provided, further, that such failure shall in all
events be cured within one hundred and eighty days (180) days after
Agent's or such Lender's written notice thereof; or
(d) Representations and Warranties. Any representation,
warranty, certificate, information or other statement (financial or
otherwise) made or furnished by or on behalf of any Borrower to Agent
or any Lender in or in connection with this Agreement or any of the
other Credit Documents, or as an inducement to Agent or any Lender to
enter into this Agreement, shall be false, incorrect, incomplete or
misleading in any material respect when made (or deemed made) or
furnished and either (i) Agent or any Lender has delivered to Borrowers
written notice thereof and such representation, warranty, certificate,
information or other statement cannot be remedied or (ii) such
representation, warranty, certificate, information or other statement
continues to be false, incorrect, incomplete or misleading in any
material respect thirty (30) days after the earlier of (A) any
Borrower's written acknowledgement that such representation, warranty,
certificate, information or other statement was false, incorrect,
incomplete or misleading in any material respect and (B) Agent's or any
Lender's written notice to Borrowers that such representation,
warranty, certificate, information or other statement was false,
incorrect, incomplete or misleading in any material respect; or
(e) Cross-Default. (i) Any Borrower, any Guarantor or any
Material Subsidiary shall fail to make any payment on account of any
Indebtedness of such Person (other than the Obligations) when due
(whether at scheduled maturity, by required prepayment, upon
acceleration or otherwise) and such failure
51
shall continue beyond any period of grace provided with respect
thereto, if the amount of such Indebtedness exceeds Fifty Million
Dollars ($50,000,000) or the effect of such failure is to cause, or
permit the holder or holders thereof to cause, Indebtedness of any
Borrower, any Guarantor and any Material Subsidiary (other than the
Obligations) in an aggregate amount exceeding Fifty Million Dollars
($50,000,000) to become due (whether at scheduled maturity, by required
prepayment, upon acceleration or otherwise); or (ii) any Borrower, any
Guarantor or any Material Subsidiary shall otherwise fail to observe or
perform any agreement, term or condition contained in any agreement or
instrument relating to any Indebtedness of such Person (other than the
Obligations), or any other event shall occur or condition shall exist,
if the effect of such failure, event or condition is to cause, or
permit the holder or holders thereof to cause, Indebtedness of any
Borrower, any Guarantor and any Material Subsidiary (other than the
Obligations) in an aggregate amount exceeding Fifty Million Dollars
($50,000,000) to become due (and/or to be secured by cash collateral
other than cash collateral obligations not arising from an event of
default under any agreement or instrument relating to Indebtedness
incurred in connection with a synthetic lease transaction or letters of
credit); or
(f) Insolvency, Voluntary Proceedings. Any Borrower or
any Significant Subsidiary shall (i) apply for or consent to the
appointment of a receiver, trustee, liquidator or custodian of itself
or of all or a substantial part of its property, (ii) be unable, or
admit in writing its inability, to pay its debts generally as they
mature, (iii) make a general assignment for the benefit of its or any
of its creditors, (iv) become insolvent (as such term may be defined or
interpreted under any applicable statute), (v) commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or consent
to any such relief or to the appointment of or taking possession of its
property by any official in an involuntary case or other proceeding
commenced against it, or (vi) take any action for the purpose of
effecting any of the foregoing; or FIL, any Designated Borrower or any
Material Subsidiary shall be dissolved or liquidated in full or in
part; or
(g) Involuntary Proceedings. Proceedings for the
appointment of a receiver, trustee, liquidator or custodian of any
Borrower or any Significant Subsidiary or of all or a substantial part
of the property thereof, or an involuntary case or other proceedings
seeking liquidation, reorganization or other relief with respect to any
Borrower or any Significant Subsidiary or the debts thereof under any
bankruptcy, insolvency or other similar law now or hereafter in effect
shall be commenced and an order for relief entered or such proceeding
shall not be dismissed or discharged within sixty (60) days of
commencement; or
(h) Judgments. (i) One or more judgments, orders, decrees
or arbitration awards requiring Borrowers and/or FIL's Subsidiaries to
pay an aggregate amount of Fifty Million Dollars ($50,000,000) or more
(exclusive of amounts covered by insurance issued by an insurer not an
Affiliate of Borrowers and otherwise satisfying the requirements set
forth in Subparagraph 5.01(d) to which the insurer does not dispute
coverage) shall be rendered against Borrowers and/or FIL's Subsidiaries
in connection with any single or related series of transactions,
incidents or circumstances and the same shall not be satisfied, vacated
or stayed for a period of sixty (60) consecutive days, (ii) any
judgment, writ, assessment, warrant of attachment, tax lien or
execution or similar process shall be issued or levied against a
substantial part of the property of any Borrower or any of FIL's
Subsidiaries and the same shall not be released, stayed, vacated or
otherwise dismissed within sixty (60) days after issue or levy or (iii)
any other judgments, orders, decrees, arbitration awards, writs,
assessments, warrants of attachment, tax liens or executions or similar
processes which, alone or in the aggregate, are reasonably and
substantially likely to have a Material Adverse Effect are rendered,
issued or levied; or
(i) Credit Documents. Any Credit Document or any material
term thereof shall cease to be, or be asserted by any Borrower or any
Guarantor not to be, a legal, valid and binding obligation of any
Borrower or any Guarantor enforceable in accordance with its terms; or
(j) Employee Benefit Plans. Any Reportable Event which
constitutes grounds for the termination of any Employee Benefit Plan by
the PBGC or for the appointment of a trustee by the PBGC to
52
administer any Employee Benefit Plan shall occur, or any Employee
Benefit Plan shall be terminated within the meaning of Title IV of
ERISA or a trustee shall be appointed by the PBGC to administer any
Employee Benefit Plan; or
(k) Change of Control. Any Change of Control shall occur;
or
(l) Material Adverse Effect. Any event(s) or condition(s)
which is (are) reasonably and substantially likely to have a Material
Adverse Effect shall occur or exist.
6.02. Remedies. At any time after the occurrence and during the
continuance of any Event of Default (other than an Event of Default referred to
in Subparagraph 6.01(f) or 6.01(g)), Agent may, with the consent of the Required
Lenders, or shall, upon instructions from the Required Lenders, by written
notice to Borrowers, (a) terminate the Commitments and the obligations of
Lenders to make Loans and to participate in Letters of Credit and of Issuing
Bank to issue Letters of Credit, and/or (b) declare all outstanding Obligations
payable by Borrowers to be immediately due and payable without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived, anything contained herein or in the Notes to the contrary
notwithstanding and (c) direct Borrowers to deliver to Agent cash collateral in
an amount equal to the aggregate stated amount of all Letters of Credit. Upon
the occurrence or existence of any Event of Default described in Subparagraph
6.01(f) or 6.01(g), immediately and without notice, (a) the Commitments and the
obligations of Lenders to make Loans and to participate in Letters of Credit,
and of the Issuing Bank to issue Letters of Credit shall automatically terminate
and (b) all outstanding Obligations payable by Borrowers hereunder shall
automatically become immediately due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived, anything contained herein or in the Notes to the contrary
notwithstanding. In addition to the foregoing remedies, upon the occurrence or
existence of any Event of Default, Agent may exercise any other right, power or
remedy available to it under any of the Credit Documents or otherwise by law,
either by suit in equity or by action at law, or both.
6.03. Lender Rate Contract Remedies. Notwithstanding any other
provision of this Section VI, each Lender or its Affiliate which has entered
into a Lender Rate Contract shall have the right, with prior notice to Agent,
but without the approval or consent of Agent or any other Lender, (a) to declare
an event of default, termination event or other similar event thereunder which
will result in the early termination of such Lender Rate Contract, (b) to
determine net termination amounts in accordance with the terms of such Lender
Rate Contract and to set-off amounts between Lender Rate Contracts of such
Lender, and (c) to prosecute any legal action against any Borrower or any of
FIL's Subsidiaries to enforce net amounts owing to such Lender or its Affiliate
under such Lender Rate Contracts.
SECTION VII. THE AGENT AND RELATIONS AMONG LENDERS.
7.01. Appointment, Powers and Immunities. Each Lender hereby
appoints and authorizes Agent to act as its agent hereunder and under the other
Credit Documents with such powers as are expressly delegated to Agent by the
terms of this Agreement and the other Credit Documents, together with such other
powers as are reasonably incidental thereto. Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement or in any
other Credit Document, be a trustee for any Lender or have any fiduciary duty to
any Lender. Notwithstanding anything to the contrary contained herein Agent
shall not be required to take any action which is contrary to this Agreement or
any other Credit Document or any applicable Governmental Rule. Neither Agent nor
any Lender shall be responsible to any other Lender for any recitals,
statements, representations or warranties made by any Borrower or any Guarantor
contained in this Agreement or in any other Credit Document, for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Credit Document or for any failure by any Borrower or any
Guarantor to perform their respective obligations hereunder or thereunder. Agent
may employ agents and attorneys-in-fact and shall not be responsible to any
Lender for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. Neither Agent nor any of its directors,
officers, employees, agents or advisors shall be responsible to any Lender for
any action taken or omitted to be taken by it or them hereunder or under any
other Credit Document or in connection herewith or therewith, except for its or
their own gross negligence or willful misconduct. Except as otherwise provided
under this
53
Agreement, Agent shall take such action with respect to the Credit Documents as
shall be directed by the Required Lenders.
7.02. Reliance by Agent. Agent shall be entitled to rely upon any
certificate, notice or other document (including any cable, telegram, facsimile
or telex) believed by it in good faith to be genuine and correct and to have
been signed or sent by or on behalf of the proper Person or Persons, and upon
advice and statements of legal counsel, independent accountants and other
experts selected by Agent with reasonable care. As to any other matters not
expressly provided for by this Agreement, Agent shall not be required to take
any action or exercise any discretion, but shall be required to act or to
refrain from acting upon instructions of the Required Lenders and shall in all
cases be fully protected by Lenders in acting, or in refraining from acting,
hereunder or under any other Credit Document in accordance with the instructions
of the Required Lenders, and such instructions of the Required Lenders and any
action taken or failure to act pursuant thereto shall be binding on all of
Lenders.
7.03. Defaults. Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default unless Agent has received a written
notice from a Lender or any Borrower, referring to this Agreement, describing
such Default and stating that such notice is a "Notice of Default". If Agent
receives such a notice of the occurrence of a Default, Agent shall give prompt
notice thereof to Lenders. Agent shall take such action with respect to such
Default as shall be reasonably directed by the Required Lenders; provided,
however, that until Agent shall have received such directions, Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default as it shall deem advisable in the best interest of
Lenders.
7.04. Indemnification. Without limiting the Obligations of Borrowers
hereunder, each Lender agrees to indemnify Agent, ratably in accordance with
their Proportionate Shares, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may at any time be imposed on, incurred
by or asserted against Agent in any way relating to or arising out of this
Agreement or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or the enforcement of any of the
terms hereof or thereof; provided, however, that no Lender shall be liable for
any of the foregoing to the extent they arise from Agent's gross negligence or
willful misconduct. Agent shall be fully justified in refusing to take or in
continuing to take any action hereunder unless it shall first be indemnified to
its satisfaction by Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
obligations of each Lender under this Paragraph 7.04 shall survive the payment
and performance of the Obligations, the termination of this Agreement and any
Lender ceasing to be a party to this Agreement (with respect to events which
occurred prior to the time such Lender ceased to be a Lender hereunder).
7.05. Non-Reliance. Each Lender represents that it has,
independently and without reliance on Agent, or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of the business, prospects, management, financial condition and
affairs of Borrowers and FIL's Subsidiaries and its own decision to enter into
this Agreement and agrees that it will, independently and without reliance upon
Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own appraisals and
decisions in taking or not taking action under this Agreement. Neither Agent nor
any of its affiliates nor any of their respective directors, officers,
employees, agents or advisors shall (a) be required to keep any Lender informed
as to the performance or observance by any Borrower or any Guarantor of the
obligations under this Agreement or any other document referred to or provided
for herein or to make inquiry of, or to inspect the properties or books of any
Borrower or any of FIL's Subsidiaries, (b) have any duty or responsibility to
provide any Lender with any credit or other information concerning any Borrower
or any of FIL's Subsidiaries which may come into the possession of Agent, except
for notices, reports and other documents and information expressly required to
be furnished to Lenders by Agent hereunder or (c) be responsible to any Lender
for (i) any recital, statement, representation or warranty made by any Borrower
or any officer, employee or agent of any Borrower in this Agreement or in any of
the other Credit Documents, (ii) the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any Credit
Document, or (iii) any failure by any Borrower or any Guarantor to perform its
obligations under this Agreement or any other Credit Document.
54
7.06. Resignation or Removal of Agent. Agent may resign at any time
by giving thirty (30) days prior written notice thereof to Borrowers and
Lenders, and Agent may be removed at any time with or without cause by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Agent, which Agent, if not a Lender,
shall be reasonably acceptable to Borrowers; provided, however, that Borrowers
shall have no right to approve a successor Agent if a Default has occurred and
is continuing. If no successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days of after the
retiring Agent gives notice of its resignation, then the retiring Agent may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Agent, which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
at which point (and not earlier) the retiring Agent shall be discharged from the
duties and obligations thereafter arising hereunder. After any retiring Agent's
resignation or removal hereunder as Agent, the provisions of this Section VII
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
7.07. Agent in its Individual Capacity. Agent, Issuing Bank and
their respective affiliates may make loans to, accept deposits from and
generally engage in any kind of banking or other business with Borrowers and any
of FIL's Subsidiaries and affiliates as though Agent was not Agent hereunder and
Issuing Bank was not Issuing Bank hereunder. With respect to Loans, if any, made
by Agent in its capacity as a Lender and Letters of Credit, if any, issued by
Issuing Bank in its capacity as Issuing Bank, Agent and Issuing Bank shall have
the same rights and powers under this Agreement and the other Credit Documents
as any other Lender and may exercise the same as though it were not Agent or
Issuing Bank, respectively, and the terms "Lender" and "Lenders" shall include
Agent in its capacity as a Lender and Issuing Bank in its capacity as a Lender,
respectively.
7.08. Co-Arrangers, Co-Syndication Agents, Senior Managing Agents
Managing Agents and Documentation Agent. The Co-Arrangers, the Co-Syndication
Agents, the Senior Managing Agents, the Managing Agents and the Documentation
Agent do not assume any responsibility or obligation under this Agreement or any
of the other Credit Documents or any duties as agents for the Lenders. The title
"Co-Arrangers", "Co-Syndication Agents", "Senior Managing Agents", "Managing
Agents" and "Documentation Agent" implies no fiduciary responsibility on the
part of any Co-Arranger, Co-Syndication Agent, Senior Managing Agents, Managing
Agents and the Documentation Agent to any Person, and the use of such title does
not impose on any Co-Arranger, Co-Syndication Agent, Senior Managing Agents,
Managing Agents and the Documentation Agent any duties or obligations under this
Agreement or any of the other Credit Documents.
SECTION VIII. MISCELLANEOUS.
8.01. Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or upon any
Borrower, any Lender, Issuing Bank or Agent under this Agreement or the other
Credit Documents shall be in writing and faxed, mailed or delivered, if to any
Borrower, Agent or Issuing Bank, at its respective facsimile number or address
set forth below or, if to any Lender, at the address or facsimile number
specified for such Lender in Part B of Schedule I (or to such other facsimile
number or address for any party as indicated in any notice given by that party
to the other parties). All such notices and communications shall be effective
(a) when sent by an overnight courier service of recognized standing, on the
second Business Day following the deposit with such service, (b) when delivered
by hand, upon delivery, (c) when faxed, upon confirmation of receipt, or (d) by
any other means, upon receipt; provided, however, that any notice delivered to
Agent or Issuing Bank under Section II shall not be effective until received by
Agent or Issuing Bank.
Agent: ABN AMRO Bank N.V.
Syndications Group
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
U.S.A.
Attn: Xxxx Xxxxxxxx
55
Tel. No: (000) 000-0000
Fax. No: (000) 000-0000
With a copy in each case to:
ABN AMRO Bank N.V.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000)000-0000
ABN AMRO Bank N.V.
Agency Services
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attn: Xxxxxxxx X. Xxx
Tel. No: (000) 000-0000
Fax. No: (000) 000-0000
Issuing Bank: Fleet National Bank
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx
XX XX 00000X
Telephone: (000) 000-0000
Fax No: (000) 000-0000
FIL: Flextronics International Ltd.
00 Xxx Xxxx 0 #00-00/00
Xxxxxx Xxxxxxxxxx Xxxxxxxx
Xxxxxxxxx 000000
Attn: Chairman
Telephone: + (00) 000-0000
Fax No: + (00) 000-0000
with copies to:
Flextronics International Ltd.
0000 Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Treasurer
Tel. No: (000) 000-0000
Fax. No: (000) 000-0000
ABN AMRO Bank N.V.
Agency Services
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attn: Xxxxxxxx X. Xxx
Tel. No: (000) 000-0000
Fax. No: (000) 000-0000
56
Each Notice of Borrowing, Notice of Interest Period Selection and LC Application
shall be given by the applicable Borrower to Agent, and in the case of an LC
Application, to Agent and Issuing Bank, to the office of such Person located at
the address referred to above during such office's normal business hours;
provided, however, that any such notice received by any such Person after 11:00
a.m. (California time) on any Business Day shall be deemed received by such
Person on the next Business Day. In any case where this Agreement authorizes
notices, requests, demands or other communications by Borrowers to Agent,
Issuing Bank or any Lender to be made by telephone or facsimile, Agent, Issuing
Bank or any Lender may conclusively presume that anyone purporting to be a
person designated in any incumbency certificate or other similar document
received by Agent or a Lender is such a person.
8.02. Expenses. Borrowers jointly and severally agree to pay on
demand, whether or not any Loan is made or Letter of Credit is issued hereunder,
(a) all reasonable fees and expenses, including reasonable attorneys' fees and
expenses, incurred by Agent in connection with the syndication of the Loans, the
preparation, negotiation, execution and delivery of, and the exercise of its
duties under, this Agreement and the other Credit Documents, and the
preparation, negotiation, execution and delivery of amendments and waivers
hereunder and thereunder and (b) all reasonable fees and expenses, including
reasonable attorneys' fees and expenses, incurred by Agent and Lenders in the
enforcement or attempted enforcement of any of the Obligations or in preserving
any of Agent's or Lenders' rights and remedies (including all such fees and
expenses incurred in connection with any "workout" or restructuring affecting
the Credit Documents or the Obligations or any bankruptcy or similar proceeding
involving any Borrower or any of FIL's Subsidiaries). As used herein, the term
"reasonable attorneys' fees and expenses" shall include, without limitation,
allocable costs and expenses of Agent's and Lenders' in-house legal counsel and
staff. The obligations of Borrowers under this Paragraph 8.02 shall survive the
payment and performance of the Obligations and the termination of this
Agreement.
8.03. Indemnification. To the fullest extent permitted by law,
Borrowers jointly and severally agree to protect, indemnify, defend and hold
harmless Agent, Lenders and their Affiliates and their respective directors,
officers, employees, agents and advisors ("Indemnitees") from and against any
and all liabilities, losses, damages or expenses of any kind or nature
(including, with respect to Taxes, only those Taxes that constitute Non-Excluded
Taxes) and from any suits, claims or demands (including in respect of or for
reasonable attorney's fees and other expenses) arising on account of or in
connection with any matter or thing or action or failure to act by Indemnitees,
or any of them, arising out of or relating to the Credit Documents or any
transaction contemplated thereby, including any use by any Borrower of any
proceeds of the Loans or any Letter of Credit, except to the extent such
liability arises from the willful misconduct or gross negligence of such
Indemnitee. Each request for any indemnity payment by an Indemnitee under this
Paragraph 8.03 must be accompanied by a reasonably detailed written explanation
identifying the liability, loss, damage or expense regarding which the
indemnification is being requested and explaining the basis for such
indemnification claim. In addition, if any Lender determines reasonably, in good
faith, and in its sole discretion that it has received a refund of, credit or
benefit of a deduction resulting from, any Non-Excluded Taxes to which it has
been indemnified by Borrowers or with respect to which Borrowers have paid
additional amounts pursuant to this Paragraph 8.03 or Paragraph 2.13, it shall
pay the amount of such refund, credit or benefit of such deduction to Borrowers
(but only to the extent of indemnity payments made, or additional amounts paid,
by Borrowers with respect to the Non-Excluded Taxes giving rise to such refund,
credit or deduction), net of all incurred out-of-pocket expenses of such Lender
and without interest (other than interest paid by the relevant Governmental
Authority with respect to such refund, credit or benefit of such deduction);
provided, however, that Borrowers shall, upon the written request of such
Lender, agree to repay the amount paid over to Borrowers (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
such Lender in the event such Lender is required by force of law to repay such
refund, credit or benefit of such deduction to such Governmental Authority. The
obligations of Borrowers under this Paragraph 8.03 shall survive the payment and
performance of the Obligations and the termination of this Agreement.
8.04. Waivers; Amendments. Any term, covenant, agreement or
condition of this Agreement or any other Credit Document may be amended or
waived, and any consent under this Agreement or any other Credit Document may be
given, if such amendment, waiver or consent is in writing and is signed by
Borrowers and the Combined Required Lenders; provided, however, that:
(i) Any amendment, waiver or consent which would
(A) increase the Total Commitment, (B) postpone, delay or
extend the Maturity Date, (C) reduce the principal of or
57
interest on any Loan or any Letter of Credit, the Commitment
Fees or any other fees or amounts payable for the account of
all Lenders hereunder, (D) postpone, delay or extend the
scheduled date for payment of any such principal, interest,
fees or amounts, (E) amend this Paragraph 8.04, (F) amend the
definition of Currencies, Designated Borrowers, Required
Lenders or Combined Required Lenders or (G) release any
Guarantor (except for releases as provided in Paragraph 2.15),
must be in writing and signed or approved in writing by all
Lenders;
(ii) Any amendment, waiver or consent which would
increase or decrease the Commitment of any Lender (except for
a pro rata decrease in the Commitments of all Lenders) must be
in writing and signed by such Lender;
(iii) Any amendment, waiver or consent which would
alter Paragraph 2.11 in a manner that would alter the pro rata
sharing of payments required thereby must be in writing and
signed by all Lenders;
(iv) Any amendment, waiver or consent which would
change any provision of any Credit Document in a manner that
by its terms adversely affects the rights in respect of
payments due to Lenders holding Loans under this Agreement
differently than those Lenders holding Loans under the FIUI
Credit Agreement must be in writing and signed by the Required
Lenders; and
(v) Any amendment, waiver or consent which
affects the rights or obligations of the Issuing Bank must be
in writing and signed by the Issuing Bank; and
(vi) Any amendment, waiver or consent which
affects the rights or obligations of Agent must be in writing
and signed by Agent.
No failure or delay by Agent or any Lender in exercising any right under this
Agreement or any other Credit Document shall operate as a waiver thereof or of
any other right hereunder or thereunder nor shall any single or partial exercise
of any such right preclude any other further exercise thereof or of any other
right hereunder or thereunder. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
specific instance and for the specific purpose for which given.
8.05. Successors and Assigns.
(a) Binding Effect. This Agreement and the other Credit
Documents shall be binding upon and inure to the benefit of Borrowers,
Lenders, Agent, all future holders of the Notes and their respective
successors and permitted assigns, except that any Borrower may not
assign or transfer any of its rights or obligations under any Credit
Document without the prior written consent of Agent and each Lender.
(b) Participations. Any Lender may at any time sell to
one or more banks or other financial institutions ("Participants")
participating interests in any Loan owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other interest of
such Lender under this Agreement and the other Credit Documents. In the
event of any such sale by a Lender of participating interests, such
Lender's obligations under this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof,
such Lender shall remain the holder of its Notes for all purposes under
this Agreement and Borrowers and Agent shall continue to deal solely
and directly with such Lender in connection with such Lender's rights
and obligations under this Agreement. Any agreement pursuant to which
any such sale is effected may require the selling Lender to obtain the
consent of the Participant in order for such Lender to agree in writing
to any amendment, waiver or consent of a type specified in Subparagraph
8.04 (i), (ii) or (iii), to the extent applicable but may not otherwise
require the selling Lender to obtain the consent of such Participant to
any other amendment, waiver or consent hereunder. Borrowers also agree
that any Lender which has transferred any participating interest in its
Commitments or Loans shall, notwithstanding any such transfer, be
entitled to the full benefits accorded such Lender under Paragraph
2.12, Paragraph 2.13, and Paragraph 2.14, as if such Lender had not
made such transfer.
58
(c) Assignments. Any Lender may, at any time, sell and
assign to any Eligible Assignee (individually, an "Assignee Lender")
all or a portion of its rights and obligations under this Agreement and
the other Credit Documents (such a sale and assignment to be referred
to herein as an "Assignment") pursuant to an assignment and assumption
substantially in the form of Exhibit D (an "Assignment and
Assumption"), executed by each Assignee Lender and such assignor Lender
(an "Assignor Lender") and delivered to Agent for its acceptance and
recording in the Register; provided, however, that:
(i) Without the written consent of Agent,
Issuing Bank and, if no Default has occurred and is
continuing, FIL (which consent of Agent, Issuing Bank and FIL
shall not be unreasonably withheld), no Lender may make any
Assignment of its Commitment or Loans to any Assignee Lender
which is not, immediately prior to such Assignment, a Lender
hereunder or an Affiliate thereof;
(ii) Without the written consent of Agent,
Issuing Bank and, if no Default has occurred and is
continuing, FIL (which consent of Agent, Issuing Bank and FIL
shall not be unreasonably withheld), no Lender may make any
Assignment of its Commitment and Loans to any Assignee Lender
if, after giving effect to such Assignment, the Commitment
(or, after the termination of the Commitments, the Loans) of
such Assignor Lender or such Assignee Lender would be less
than Two Million Five Hundred Thousand Dollars ($2,500,000),
except that a Lender may make an Assignment which reduces its
Commitment (or, after the termination of the Commitments, its
Loans) to zero without the written consent of FIL and the
Issuing Bank;
(iii) Without the written consent of Agent,
Issuing Bank and, if no Default has occurred and is
continuing, FIL (which consent of Agent, Issuing Bank and FIL
shall not be unreasonably withheld), no Lender may make any
Assignment of its Commitment and Loans which does not assign
and delegate an equal pro rata interest in such Lender's
Commitment, Loans and all other rights, duties and obligations
of such Lender under this Agreement and the other Credit
Documents;
(iv) Without the written consent of Agent,
Issuing Bank and, if no Default has occurred and is
continuing, FIL (which consent of Agent, Issuing Bank and FIL
shall not be unreasonably withheld), no Lender may make any
Assignment of its Commitment and Loans under this Agreement to
any Assignee Lender unless such Lender concurrently assigns
and delegates to such Assignee Lender an equal pro rata
interest in its "Commitment" and "Loans" under the FIUI Credit
Agreement; and
(v) Without the written consent of Agent,
Issuing Bank and, if no Default has occurred and is
continuing, FIL (which consent of Agent, Issuing Bank and FIL
shall not be unreasonably withheld), no Lender may make any
Assignment of its Commitments and Loans to any Assignee Lender
in an aggregate principal amount of less than Five Million
Dollars ($5,000,000), except that a Lender may make an
Assignment which reduces its Commitment (or, after the
termination of the Commitments, its Loans) to zero without the
written consent of FIL and the Agent.
Upon such execution, delivery, acceptance and recording of each Assignment and
Assumption, from and after the Assignment Effective Date determined pursuant to
such Assignment and Assumption, (A) each Assignee Lender thereunder shall be a
Lender hereunder with Commitments or Loans as set forth on Attachment 1 to such
Assignment and Assumption (under the caption "Commitments or Loans After
Assignment") and shall have the rights, duties and obligations of such a Lender
under this Agreement and the other Credit Documents and (B) the Assignor Lender
thereunder shall be a Lender with Commitments or Loans as set forth on
Attachment 1 to such Assignment and Assumption (under the caption "Commitments
or Loans After Assignment"), or, if the Commitments or Loans of the Assignor
Lender have been reduced to zero, the Assignor Lender shall cease to be a Lender
and to have any obligation to make any Loan; provided, however, that any such
Assignor Lender which ceases to be a Lender shall continue to be entitled to the
benefits of any provision of this Agreement which by its terms survives the
termination of this Agreement. Each Assignment and Assumption shall be deemed to
amend
59
Schedule I to the extent, and only to the extent, necessary to reflect the
addition of each Assignee Lender, the deletion of each Assignor Lender which
reduces its Commitments or Loans to zero, or the resulting adjustment of
Commitments or Loans arising from the purchase by each Assignee Lender of all or
a portion of the rights and obligations of an Assignor Lender under this
Agreement and the other Credit Documents, as the case may be. On or prior to the
Assignment Effective Date determined pursuant to each Assignment and Assumption,
Borrowers, at their own expense, shall, if requested by Assignee Lenders,
execute and deliver to Agent, in exchange for the surrendered Notes, if any, of
the Assignor Lender thereunder, new Notes to the order of each Assignee Lender
thereunder and, if the Assignor Lender is continuing as a Lender hereunder, new
Notes to the order of the Assignor Lender. The Notes surrendered by the Assignor
Lender shall be returned by Agent to Borrowers marked "replaced". Each Assignee
Lender which becomes a Lender and was not previously such a Lender hereunder
shall, prior to becoming such a Lender, deliver such certificates and other
evidence as is required by Subparagraph 2.13(b).
(d) Register. Agent shall maintain at its address
referred to in Paragraph 8.01 a copy of each Assignment and Assumption
delivered to it and a register (the "Register") for the recordation of
the names and addresses of Lenders and the Commitments or Loans of each
Lender from time to time. The entries in the Register shall be
conclusive in the absence of manifest error, and Borrowers, Agent and
Lenders may treat each Person whose name is recorded in the Register as
the owner of the Commitments or Loans recorded therein for all purposes
of this Agreement. The Register shall be available for inspection by
any Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(e) Registration. Upon its receipt of an Assignment and
Assumption executed by an Assignor Lender and an Assignee Lender (and,
to the extent required by Subparagraph 8.05(c), by Borrowers, Agent and
Issuing Bank) together with payment to Agent by Assignor Lender of a
registration and processing fee of Three Thousand Five Hundred Dollars
($3,500), Agent shall (i) promptly accept such Assignment and
Assumption and (ii) on the Effective Date determined pursuant thereto
record the information contained therein in the Register and give
notice of such acceptance and recordation to Lenders and Borrowers.
Agent may, from time to time at its election, prepare and deliver to
Lenders and Borrowers a revised Schedule I reflecting the names,
addresses and respective Commitments or Loans of all Lenders then
parties hereto.
(f) Confidentiality. Subject to Paragraph 8.12, Agent and
Lenders may disclose the Credit Documents and any financial or other
information relating to Borrowers or any Subsidiary to each other or to
any potential Participant or Assignee Lender.
(g) Pledges to Federal Reserve Banks. Notwithstanding any
other provision of this Agreement, any Lender may at any time assign or
pledge all or a portion of its rights under this Agreement and the
other Credit Documents to a Federal Reserve Bank, and this Paragraph
8.05 shall not apply to any such pledge or assignment of a security
interest. No such assignment shall relieve the assigning Lender from
its obligations under this Agreement and the other Credit Documents.
8.06. Set-off; Security Interest.
(a) Set-off. In addition to any rights and remedies of
Lenders provided by law, each Lender shall have the right, with prior
notice to Agent but without prior notice to or consent of Borrowers,
any such notice and consent being expressly waived by Borrowers to the
extent permitted by applicable law, upon the occurrence and during the
continuance of an Event of Default, to set-off and apply against the
Obligations of any Borrower any amount owing from such Lender to such
Borrower. The aforesaid right of set-off may be exercised by such
Lender against a Borrower or against any trustee in bankruptcy, debtor
in possession, assignee for the benefit of creditors, receiver or
execution, judgment or attachment creditor of such Borrower or against
anyone else claiming through or against such Borrower or such trustee
in bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver, or execution, judgment or attachment creditor,
notwithstanding the fact that such right of set-off may not have been
exercised by such Lender at any prior time. Each Lender agrees promptly
to notify the applicable Borrower after any such set-off and
application made by such Lender, provided that the failure to give such
notice shall not affect the validity of such set-off and application.
60
(b) Security Interest. As security for the Obligations,
each Borrower hereby grants to Agent and each Lender, for the benefit
of all Lenders, a continuing security interest in any and all deposit
accounts or moneys of such Borrower now or hereafter maintained with
such Lender. Each Lender shall have all of the rights of a secured
party with respect to such security interest.
8.07. No Third Party Rights. Nothing expressed in or to be implied
from this Agreement is intended to give, or shall be construed to give, any
Person, other than the parties hereto and their permitted successors and assigns
hereunder, any benefit or legal or equitable right, remedy or claim under or by
virtue of this Agreement or under or by virtue of any provision herein.
8.08. Partial Invalidity. If at any time any provision of this
Agreement is or becomes illegal, invalid or unenforceable in any respect under
the law or any jurisdiction, neither the legality, validity or enforceability of
the remaining provisions of this Agreement nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction shall
in any way be affected or impaired thereby.
8.09. Jury Trial. EACH OF BORROWERS, LENDERS AND AGENT, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT.
8.10. Counterparts. This Agreement may be executed in any number of
identical counterparts, any set of which signed by all the parties hereto shall
be deemed to constitute a complete, executed original for all purposes.
8.11. Borrowers' Liabilities. All Borrowers are jointly and
severally liable for the payment and performance of all other Obligations under
this Agreement and the other Credit Documents, and Borrowers also are liable for
the payment and performance of all Obligations under this Agreement and the
other Credit Documents as provided in the Guaranty.
8.12. Confidentiality. Neither any Lender nor Agent shall disclose
to any Person any information with respect to Borrowers, any Guarantor or any of
FIL's Subsidiaries which is furnished pursuant to this Agreement or under the
other Credit Documents, except that any Lender or Agent may disclose any such
information (a) to its own directors, officers, employees, auditors, counsel and
other advisors and to its Affiliates, (b) to any other Lender or Agent, (c)
which is otherwise available to the public, (d) if required or appropriate in
any report, statement or testimony submitted to any Governmental Authority
having or claiming to have jurisdiction over such Lender or Agent, (e) if
required in response to any summons or subpoena, (f) in connection with any
enforcement by Lenders and Agent of their rights under this Agreement or the
other Credit Documents or any litigation among the parties relating to the
Credit Documents or the transactions contemplated thereby, (g) to comply with
any Requirement of Law applicable to such Lender or Agent, (h) to any actual or
prospective Assignee Lender, Participant or counterparty (or its advisors) to
any Rate Contract, provided that such Person agrees to be bound by this
Paragraph 8.12, or (i) otherwise with the prior consent of the applicable
Borrower; provided, however, that (i) any Lender or Agent served with any
summons or subpoena demanding the disclosure of any such information shall use
reasonable efforts to notify Borrowers promptly of such summons or subpoena if
not prohibited by any Requirement of Law and, if requested by Borrowers and not
disadvantageous to such Lender or Agent, to cooperate with Borrowers in
obtaining a protective order restricting such disclosure, and (ii) any
disclosure made in violation of this Agreement shall not affect the obligations
of Borrowers or any Guarantor under this Agreement and the other Credit
Documents.
8.13. Consent to Jurisdiction. Each Borrower irrevocably submits to
the non-exclusive jurisdiction of the courts of the State of New York and the
courts of the United States of America, in either case located in the City of
New York, and agrees that any legal action, suit or proceeding arising out of or
relating to this Agreement or any of the other Credit Documents may be brought
against such party in any such courts. Final judgment against any Borrower in
any such action, suit or proceeding shall be conclusive and may be enforced in
any other jurisdiction by suit on the judgment, a certified or exemplified copy
of which shall be conclusive evidence of the judgment, or in any other manner
provided by law. Nothing in this Paragraph 8.13 shall affect the right of Agent
or any Lender to
61
commence legal proceedings or otherwise xxx any Borrower in any other
appropriate jurisdiction, or concurrently in more than one jurisdiction, or to
serve process, pleadings and other papers upon any Borrower in any manner
authorized by the laws of any such jurisdiction. Each Borrower agrees that
process served either personally or by registered mail shall, to the extent
permitted by law, constitute adequate service of process in any such suit.
Without limiting the foregoing, each Borrower hereby appoints, in the case of
any such action or proceeding brought in the courts of or in the State of New
York, CT Corporation, with offices on the date hereof at 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, to receive for it and on its behalf, service of process in
the State of New York with respect thereto, provided each Borrower may appoint
any other person, reasonably acceptable to Agent, with offices in the State of
New York to replace such agent for service of process upon delivery to Agent of
a reasonably acceptable agreement of such new agent agreeing so to act. Each
Borrower irrevocably waives to the fullest extent permitted by applicable law
(a) any objection which it may have now or in the future to the laying of the
venue of any such action, suit or proceeding in any court referred to in the
first sentence above, (b) any claim that any such action, suit or proceeding has
been brought in an inconvenient forum, (c) its right of removal of any matter
commenced by any other party in the courts of the State of New York to any court
of the United States of America, (d) any immunity which it or its assets may
have in respect of its obligations under this Agreement or any other Credit
Document from any suit, execution, attachment (whether provisional or final, in
aid of execution, before judgment or otherwise) or other legal process, and (e)
any right it may have to require the moving party in any suit, action or
proceeding brought in any of the courts referred to above arising out of or in
connection with this Agreement or any other Credit Document to post security for
the costs of such Borrower or to post a bond or to take similar action. The
obligations of Borrower under this Paragraph 8.13 shall survive the payment and
performance of the Obligations and the termination of this Agreement.
8.14. Usury. In no event shall any provision of this Agreement or
any other Credit Document ever obligate any Borrower to pay or allow any Lender
to collect interest on any Loan or any other Obligation of a Borrower hereunder
at a rate greater than the maximum non-usurious rate permitted by applicable law
(herein referred to as the "highest lawful rate"), or obligate any Borrower to
pay any taxes, assessments, charges, insurance premiums or other amounts to the
extent that such payments, when added to the interest payable on the Loans or
any other Obligations, would be held to constitute the payment by a Borrower of
interest at a rate greater than the highest lawful rate. This provision shall
control over any provision to the contrary. Without limiting the generality of
the foregoing, in the event the maturity of all or any part of the principal
amount of the Obligations of a Borrower shall be accelerated for any reason,
then such principal amount so accelerated shall be credited with any interest
theretofore paid thereon in advance and remaining unearned at the time of such
acceleration. If, pursuant to the terms of this Agreement, any funds are applied
to the payment of any part of the principal amount of the Obligations of a
Borrower prior to the maturity thereof, then (a) any interest which would
otherwise thereafter accrue on the principal amount so paid by such application
shall be canceled and (b) the Obligations of such Borrower remaining unpaid
after such application shall be credited with the amount of all interest, if
any, theretofore collected on the principal amount so paid by such application
and remaining unearned at the date of said application; and if the funds so
applied shall be sufficient to pay in full all the Obligations of such Borrower,
then the Lenders shall refund to such Borrower all interest theretofore paid
thereon in advance and remaining unearned at the time of such acceleration.
Regardless of any other provision in this Agreement or any other Credit
Document, no Borrower shall be required to pay any unearned interest on any
Obligations or any portion thereof, or be required to pay interest thereon at a
rate in excess of the highest lawful rate construed by courts having competent
jurisdiction thereof.
8.15. Hong Kong Branch; Full Recourse Obligations. All Loans to FIL
shall be made to FIL at its Hong Kong branch located at Room 908 Dominion
Center, 00-00 Xxxxxx Xxxx Xxxx, Xxxxxxx, Xxxx Xxxx and all payments of principal
and interest by FIL will be made through its Hong Kong branch; provided,
however, that notwithstanding the foregoing, FIL acknowledges that the
Obligations hereunder are full recourse to Flextronics International Ltd., a
Singapore corporation, and are in no manner limited to any extent to any branch
thereof and shall in no manner impair the Agent's or any Lender's ability to
collect any Obligation from FIL.
[The first signature page follows.]
62
SIGNATURE PAGE TO
FIL CREDIT AGREEMENT
IN WITNESS WHEREOF, Borrowers, Agent, Co-Arrangers, Co-Syndication
Agents, Senior Managing Agents, Managing Agents, Documentation Agent and Lenders
have caused this Agreement to be executed as of the day and year first above
written.
BORROWER: FLEXTRONICS INTERNATIONAL LTD.,
By:____________________________________
Name:_______________________________
Title:______________________________
AGENT: ABN AMRO BANK N.V.,
As Agent
By:____________________________________
Name:_______________________________
Title:______________________________
By:____________________________________
Name:_______________________________
Title:______________________________
SIGNATURE PAGE TO
FIL CREDIT AGREEMENT
Name of Institution:____________________________________________________________
by:____________________________________
Name:_______________________________
Title:______________________________
by:____________________________________
Name:_______________________________
Title:______________________________
EXHIBIT A
NOTICE OF BORROWING
[Date]
ABN AMRO Bank N.V.
as Agent
[_________]
Attn: [_________]
1. Reference is made to that certain Credit Agreement, dated as
of March 3, 2004 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Flextronics International Ltd. ("FIL"),
each of the Subsidiaries of FIL designated as borrower from time to time in
accordance with the Credit Agreement (collectively, "Designated Borrowers"),
Lenders, Fleet National Bank, as Issuing Bank, and Agent. Lenders have agreed to
extend credit to FIL and Designated Borrowers (together, "Borrowers") upon the
terms and subject to the conditions set forth therein. Unless otherwise
indicated, all terms defined in the Credit Agreement have the same respective
meanings when used herein.
2. Pursuant to Paragraph 2.02 of the Credit Agreement, the
undersigned Borrower hereby irrevocably requests a Borrowing to be made upon the
following terms:
(a) The Currency and principal amount of such
Borrowing are to be __________;
(b) Such Borrowing is to consist of [Base Rate]
[LIBOR] Loans;
(c) If such Borrowing is to consist of LIBOR
Loans, the initial Interest Period for such Borrowing is to be __________
month[s];
(d) The date of such Borrowing is to be
__________, ____; and
(e) The Applicable Payment Office is located at
_____________________________.
3. The undersigned Borrower hereby certifies to Lenders and Agent
that, on the date of this Notice of Borrowing and after giving effect to the
requested Borrowing:
(a) The representations and warranties of
Borrowers and FIL's Subsidiaries set forth in Paragraph 4.01 of the Credit
Agreement and in the other Credit Documents are true and correct in all material
respects as if made on such date (except for representations and warranties
expressly made as of a specified date, which shall be true as of such date); and
(b) No Default has occurred and is continuing or
will result from such Credit
Event.
4. Please disburse the proceeds of the requested Borrowing to
_____________.
IN WITNESS WHEREOF, the undersigned Borrower has executed this Notice
of Borrowing on the date set forth above.
Name of Borrower:_______________________
By:____________________________________
Name:_______________________________
Title:______________________________
By:____________________________________
Name:_______________________________
Title:______________________________
A-2
EXHIBIT B
FORM OF NOTE
______________, ________ March __, 2004
FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby promises to
pay to the order of ____________________, a ____________________ ("Lender"),
pursuant to the Credit Agreement dated as of March 3, 2004 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Flextronics International Ltd. ("FIL"), each of the Subsidiaries of FIL
designated as borrower from time to time in accordance with the Credit Agreement
(collectively, "Designated Borrowers"), Lenders, Fleet National Bank, as Issuing
Bank, and Agent, on or before the Maturity Date specified in the Credit
Agreement, (a) the aggregate outstanding principal balance of all Loans made by
Lender to Borrower and (b) interest on said sum, at the rates and on the dates
provided in the Credit Agreement. Terms used herein have the meanings assigned
to those terms in the Credit Agreement, unless otherwise defined herein.
Borrower shall make all payments hereunder, for the account of Lender's
Applicable Lending Office or Offices, as the case may be, to Agent as indicated
in the Credit Agreement, in the lawful Currency required by the Credit Agreement
and in same day or immediately available funds.
Borrower hereby authorizes Lender to record on the schedule(s) annexed
to this Note (i) the date, amount and Currency of each Loan made by such Lender,
(ii) the interest rates applicable to each such Loan thereof and the effective
dates of all changes thereto, (iii) the Interest Period for each LIBOR Loan,
(iv) the date, amount and Currency of each principal and interest payment on
each Loan and (v) such other information as such Lender may determine is
necessary for the computation of principal and interest payable to it by each
Borrower hereunder. Borrower agrees that all such notations shall constitute
prima facie evidence of the matters recorded on the schedules; provided,
however, that any failure by a Lender to make, or any error by any Lender in
making, any such recordation shall not affect Borrowers' Obligations hereunder.
This Note is one of the Notes referred to in Paragraph 2.09(b) of the
Credit Agreement. This Note is subject to the terms of the Credit Agreement,
including the rights of prepayment and the rights of acceleration of maturity
set forth therein. In case an Event of Default shall occur and be continuing,
the principal of and accrued interest on this Note may become or be declared to
be due and payable in the manner and with the effect provided in the Credit
Agreement.
The transfer, sale or assignment of any rights under or interest in
this Note is subject to the restrictions contained in the Credit Agreement,
including Paragraph 8.05 thereof.
Borrower shall pay all reasonable fees and expenses, including
reasonable attorneys' fees, incurred by Lender in connection with the
enforcement or attempt to enforce any of Borrower's obligations hereunder not
performed when due. Borrower hereby waives notice of presentment, demand,
protest or notice of any other kind. This Note shall be governed by and
construed in accordance with the laws of the State of New York.
[_____________]
By:____________________________________
Name:_______________________________
Title:______________________________
LOANS AND PAYMENTS OF INTEREST AND PRINCIPAL
Loans Payments
--------------------------------------------------------- --------------------------------------------------------------------
Amount of Amount of
Amount of Interest Paid Principal Paid
Date Currency Loan Interest Period Date Currency or Prepaid or Prepaid
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
B-2
EXHIBIT C
FORM OF GUARANTY
THIS GUARANTY, dated as of March 3, 2004, is executed by each of the
undersigned (each such entity and each entity which hereafter executes and
delivers a Subsidiary Joinder in substantially the form of Attachment 1 hereto
to be referred to herein as a "Guarantor"), in favor of ABN AMRO BANK N.V.,
acting as agent (in such capacity, and each successor thereto in such capacity,
"Agent") for the financial institutions which are from time to time parties to
the Credit Agreement referred to in Recital A below (collectively, "Lenders").
RECITALS
A. Pursuant to a Credit Agreement dated as of March 3, 2004 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among Flextronics International Ltd. ("FIL"), each of the
Subsidiaries of FIL designated as borrower from time to time in accordance with
the Credit Agreement (collectively, "Designated Borrowers"), Lenders, Fleet
National Bank, as Issuing Bank, and Agent. Lenders have agreed to extend credit
to FIL and Designated Borrowers (together, "Borrowers") upon the terms and
subject to the conditions set forth therein. Each Guarantor is a Subsidiary of
FIL, expects to derive substantial direct and indirect benefit from the
transactions contemplated by the Credit Agreement and is willing to execute and
deliver this Guaranty to induce the Lenders to enter into the transactions
contemplated by the Credit Agreement.
B. Lenders' obligations to extend credit to Borrowers under the
Credit Agreement are subject, among other conditions, to receipt by Agent of (1)
this Guaranty, duly executed by each existing Eligible Material Subsidiary and
each other Subsidiary required to execute the Guaranty pursuant to Subparagraph
2.15(c) of the Credit Agreement, and (2) Subsidiary Joinders, duly executed by
each future Eligible Material Subsidiary and each other Subsidiary required to
execute a Subsidiary Joinder pursuant to Subparagraph 2.15(c) of the Credit
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, each Guarantor hereby agrees with Agent, for the ratable benefit
of the Lenders and Agent, as follows:
1. DEFINITIONS AND INTERPRETATION.
(a) Definitions. When used in this Guaranty, the following
terms shall have the following respective meanings:
"Agent" shall have the meaning given to that term in
the introductory paragraph hereof.
"Aggregate Guaranty Payments" shall mean, with
respect to any Guarantor at any time, the aggregate amount of
all payments made by such Guarantor under this Guaranty
(including under Paragraph 5 hereof) at or prior to such time.
"Borrowers" shall have the meaning given to that term
in the Recital A hereof.
"Credit Agreement" shall have the meaning given to
that term in the Recital A hereof.
"Debtor Relief Proceeding" shall mean any suit,
action, case or other proceeding commenced by, against or for
any Borrower or its property seeking the dissolution,
liquidation, reorganization, rearrangement or other relief of
such Borrower or its debts under any applicable bankruptcy,
insolvency or debtor relief law or other similar Governmental
Rule now or hereafter in effect or seeking the appointment of
a receiver, trustee, liquidator, custodian or other similar
official for such Borrower or any substantial part of its
property or any general assignment by any
Borrower for the benefit of its creditors, whether or not any
such suit, action, case or other proceeding is voluntary or
involuntary.
"Disallowed Post-Commencement Interest and Expenses"
shall mean interest computed at the rate provided in the
Credit Agreement and claims for reimbursement, costs, expenses
or indemnities under the terms of any of the Credit Documents
accruing or claimed at any time after the commencement of any
Debtor Relief Proceeding if the claim for such interest,
reimbursement, costs, expenses or indemnities is not
allowable, allowed or enforceable against Borrowers in such
Debtor Relief Proceeding.
"Fair Share" shall mean, with respect to any
Guarantor at any time, an amount equal to (i) a fraction, the
numerator which is the Maximum Guaranty Amount of such
Guarantor and the denominator of which is the aggregate
Maximum Guaranty Amounts of all Guarantors, multiplied by (ii)
the aggregate amount paid by all Funding Guarantors under this
Guaranty at or prior to such time.
"Fair Share Shortfall" shall mean, with respect to
any Guarantor at any time, the amount, if any, by which the
Fair Share of such Guarantor at such time exceeds the
Aggregate Guaranty Payments of such Guarantor at such time.
"FIL" shall have the meaning given to that term in
the Recital A hereof.
"Funding Guarantor" shall have the meaning given to
that term in Paragraph 5 hereof.
"Guaranteed Obligations" shall mean and include, with
respect to any Guarantor, all loans, advances, debts,
liabilities, and obligations, howsoever arising, owed by any
Borrower (other than such Guarantor in its capacity as a
Borrower if such Guarantor is a Borrower) to Agent or any
Lender of every kind and description (whether or not evidenced
by any note or instrument and whether or not for the payment
of money), individual or joint and several, direct or
indirect, primary or secondary, absolute or contingent, due or
to become due, now existing or hereafter arising pursuant to
the terms of the Credit Documents and any Lender Rate Contract
that (A) is in effect on the Closing Date with a counterparty
that is a Lender or an Affiliate of a Lender as of the Closing
Date or (B) is entered into after the Closing Date with any
counterparty that is a Lender or an Affiliate of a Lender at
the time such Rate Contract is entered into, including the
Loans, Reimbursement Obligations with respect to Letters of
Credit, all indemnification obligations, interest, fees,
taxes, charges, reimbursements, expenses, attorneys' fees and
accountants' fees (including Disallowed Post-Commencement
Interest and Expenses and any other monetary obligations
incurred during the pendency of any Debtor Relief Proceeding)
chargeable to any Borrower or payable by any Borrower
thereunder.
"Guarantor" shall have the meaning given to that term
in the introductory paragraph hereof.
"Lenders" shall have the meaning given to that term
in the introductory paragraph hereof.
"Maximum Guaranty Amount" shall mean, with respect to
any Guarantor at any time, (i) the full amount of the
Guaranteed Obligations at such time or (ii) if any court of
competent jurisdiction determines in any action to enforce
this Guaranty that enforcement against such Guarantor for the
full amount of the Guaranteed Obligations is not lawful under
or would be subject to avoidance under Xxxxxxx 000 xx xxx
Xxxxxx Xxxxxx Bankruptcy Code or any applicable provision of
any comparable law of any state or other jurisdiction, then
the maximum amount lawful and not subject to such avoidance.
"Subordinated Obligations" shall have the meaning
given to that term in Paragraph 4 hereof.
C-2
"Subsidiary Joinder" shall mean an instrument
substantially in the form of Attachment 1 hereto.
Unless otherwise defined herein, all other capitalized terms
used herein and defined in the Credit Agreement shall have the respective
meanings given to those terms in the Credit Agreement.
(b) Other Interpretive Provisions. The rules of construction
set forth in Section I of the Credit Agreement shall, to the extent not
inconsistent with the terms of this Guaranty, apply to this Guaranty
and are hereby incorporated by reference. Each Guarantor acknowledges
receipt of copies of the Credit Agreement and the other Credit
Documents.
2. GUARANTY.
(a) Payment Guaranty. Each Guarantor unconditionally
guarantees, as a primary obligor and not merely as surety, and promises
to pay and perform as and when due, whether at stated maturity, upon
acceleration, upon one or more dates set for prepayment or otherwise,
any and all of the Guaranteed Obligations, provided that with respect
to Flextronics Manufacturing France, such guarantee shall be limited as
provided in Paragraph 7 hereof. If (i) any Borrower fails to pay any
Guaranteed Obligation or (ii) any Debtor Relief Proceeding relating to
any Borrower is commenced, each Guarantor further unconditionally
guarantees and promises to and will forthwith pay and perform, upon the
demand of Agent, whether at stated maturity, upon acceleration, upon
one or more dates set for prepayment or otherwise, any and all of the
Guaranteed Obligations (including any and all Disallowed
Post-Commencement Interest and Expenses) in accordance with the terms
of the Credit Documents, whether or not such obligations are then due
and payable by any Guarantor and whether or not such obligations are
modified, reduced or discharged in such Debtor Relief Proceeding. This
Guaranty is a guaranty of payment and not of collection.
(b) Continuing Guaranty. This Guaranty is an irrevocable
continuing guaranty of the Guaranteed Obligations which shall continue
in effect until (i) all the Guaranteed Obligations have been fully and
indefeasibly paid in cash, (ii) the Lenders have no further commitment
to lend under the Credit Agreement, (iii) the aggregate amount
available for drawing under all Letters of Credit outstanding and all
Reimbursement Obligations outstanding have been reduced to zero and
(iv) the Issuing Bank has no further obligation to issue Letters of
Credit under the Credit Agreement. If any payment on any Guaranteed
Obligation is set aside, avoided, rescinded or otherwise recovered from
Agent or any Lender, such recovered payment shall constitute a
Guaranteed Obligation hereunder and, if this Guaranty was previously
released or terminated, it automatically shall be fully reinstated, as
if such payment was never made.
(c) Joint, Several and Independent Obligations. The liability
of each Guarantor hereunder is joint and several and is independent of
the Guaranteed Obligations. A separate action or actions may be brought
and prosecuted against each Guarantor for the full amount of the
Guaranteed Obligations irrespective of whether action is brought
against any Borrower, any other Guarantor or any other guarantor of the
Guaranteed Obligations or whether any Borrower, any other Guarantor or
any other guarantor of the Guaranteed Obligations is joined in any such
action or actions.
(d) Fraudulent Transfer Limitation. If, in any action to
enforce this Guaranty, any court of competent jurisdiction determines
that enforcement against any Guarantor for the full amount of the
Guaranteed Obligations is not lawful under or would be subject to
avoidance under Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code or any
applicable provision of any comparable law of any state or other
jurisdiction, the liability of such Guarantor under this Guaranty shall
be limited to the maximum amount lawful and not subject to such
avoidance.
(e) Termination. Notwithstanding any termination of this
Guaranty in accordance with Paragraph 2(a) hereof, this Guaranty shall
continue to be in full force and effect and applicable to any
Guaranteed Obligations arising thereafter which arise because prior
payments of Guaranteed Obligations are rescinded or otherwise required
to be surrendered by Agent or any Lender after receipt.
C-3
(f) No Discharge or Disbursement of Guaranty. Without limiting
Paragraph 3 hereof, the obligations of each Guarantor hereunder shall
not be subject to any reduction, limitation, impairment or termination
for any reason (other than the indefeasible payment in full in cash of
the Guaranteed Obligations), including any claim of waiver, release,
surrender, alteration or compromise of any of the Guaranteed
Obligations, and shall not be subject to any defense or set-off,
counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise.
3. AUTHORIZATIONS, WAIVERS, ETC.
(a) Authorizations. Each Guarantor authorizes Agent and
Lenders, in their discretion, without notice to or further assent from
such Guarantor, irrespective of any change in the financial condition
of any Borrower, such Guarantor, any other Guarantor or any other
guarantor of the Guaranteed Obligations since the date hereof, and
without affecting or impairing in any way the liability of such
Guarantor hereunder, from time to time to:
(i) Create new Guaranteed Obligations and renew,
compromise, extend, accelerate or otherwise change the time
for payment or performance of, or otherwise amend or modify
the Credit Documents or change the terms of, the Guaranteed
Obligations or any part thereof, including increase or
decrease of the rate of interest thereon;
(ii) Take and hold security for the payment or
performance of the Guaranteed Obligations and exchange,
enforce, waive or release any such security; apply such
security and direct the order or manner of sale thereof; and
purchase such security at public or private sale;
(iii) Otherwise exercise any right or remedy Agent or
any Lender may have against any Borrower, such Guarantor, any
other Guarantor, any other guarantor of the Guaranteed
Obligations or any security, including the right to foreclose
upon any such security by judicial or nonjudicial sale;
(iv) Settle, compromise with, release or
substitute any one or more makers, endorsers, Guarantors or
any other guarantor of the Guaranteed Obligations; and
(v) Assign the Guaranteed Obligations, this
Guaranty or the other Credit Documents in whole or in part to
the extent provided in the Credit Agreement and the other
Credit Documents.
(b) Waivers. Each Guarantor hereby waives:
(i) Any right to require Agent or any Lender to
(A) proceed against any Borrower, Person, any other Guarantor
or any other guarantor of the Guaranteed Obligations, (B)
proceed against, resort to or exhaust any security received
from, or any balance of any deposit account or credit on the
books of Agent or any Lender in favor of, any Person or
otherwise marshal the assets of any Borrower, such Guarantor,
any other Guarantor or any other guarantor of the Guaranteed
Obligations or (C) pursue any other remedy in Agent's or any
Lender's power whatsoever;
(ii) Any defense arising by reason of the
application by any Borrower of the proceeds of any borrowing;
(iii) Any defense resulting from the absence,
impairment or loss of any right of reimbursement, subrogation,
indemnification, contribution or other right or remedy of
Guarantor against any Borrower, any other Guarantor, any other
guarantor of the Guaranteed Obligations or any security,
whether resulting from an election by Agent or any Lender to
foreclose upon security by nonjudicial sale or otherwise;
C-4
(iv) any defense based upon or relating to the
unenforceability of the Guaranteed Obligations or any part
thereof;
(v) Any set-off or counterclaim of any Borrower
or any defense which results from any disability or other
defense of any Borrower or the cessation or stay of
enforcement from any cause whatsoever of the liability of any
Borrower (including the lack of validity or enforceability of
any of the Credit Documents);
(vi) Any defense based upon any law, rule or
regulation which provides that the obligation of a surety must
not be greater or more burdensome than the obligation of the
principal;
(vii) Until(A) all the Guaranteed Obligations have
been fully and indefeasibly paid in cash, (B) the Lenders have
no further commitment to lend under the Credit Agreement, (C)
the aggregate amount available for drawing under all Letters
of Credit outstanding and all Reimbursement Obligations
outstanding have been reduced to zero and (D) the Issuing Bank
has no further obligation to issue Letters of Credit under the
Credit Agreement, any right of subrogation, reimbursement,
indemnification or contribution and other similar right to
enforce any remedy which Agent, Lenders or any other Person
now has or may hereafter have against any Borrower on account
of the Guaranteed Obligations, and any benefit of, and any
right to participate in, any security now or hereafter
received by Agent, any Lender or any other Person on account
of the Guaranteed Obligations;
(viii) All presentments, demands for performance,
notices of non-performance, notices delivered under the Credit
Documents, protests, notice of dishonor, and notices of
acceptance of this Guaranty and of the existence, creation or
incurrence of new or additional Guaranteed Obligations and
notices of any public or private foreclosure sale;
(ix) The benefit of any statute of limitations to
the extent permitted by law;
(x) Any appraisement, valuation, stay,
extension, moratorium redemption or similar law or similar
rights with respect to the marshaling of any assets;
(xi) Any right to be informed by Agent or any
Lender of (A) the financial condition of any Borrower, any
other Guarantor or any other guarantor of the Guaranteed
Obligations or (B) any change therein or any other
circumstances bearing upon the risk of nonpayment or
nonperformance of the Guaranteed Obligations;
(xi) Any right to be informed by Agent or any
Lender of (A) the financial condition of any Borrower, any
other Guarantor or any other guarantor of the Guaranteed
Obligations or (B) any change therein or any other
circumstances bearing upon the risk of nonpayment or
nonperformance of the Guaranteed Obligations;
(xii) Until (A) all the Guaranteed Obligations
have been fully and indefeasibly paid in cash, (B) the Lenders
have no further commitment to lend under the Credit Agreement,
(C) the aggregate amount available for drawing under all
Letters of Credit outstanding and all Reimbursement
Obligations outstanding have been reduced to zero and (D) the
Issuing Bank has no further obligation to issue Letters of
Credit under the Credit Agreement, any right to revoke this
Guaranty;
(xiii) Any defense arising from an election for the
application of Section 1111(b)(2) of the United States
Bankruptcy Code which applies to the Guaranteed Obligations;
(xiv) Any defense based upon any borrowing or
grant of a security interest under Section 364 of the United
States Bankruptcy Code; and
(xv) Any right it may have to a fair value
hearing to determine the size of a deficiency judgment
following any foreclosure on any security for the Guaranteed
Obligations.
(c) Financial Condition of Borrowers, Etc. Each Guarantor is
fully aware of the financial condition and affairs of each Borrower.
Each Guarantor has executed this Guaranty without reliance upon
C-5
any representation, warranty, statement or information concerning any
Borrower furnished to such Guarantor by Agent or any Lender and has,
independently and without reliance on Agent or any Lender, and based on
such documents and information as it has deemed appropriate, made its
own appraisal of the financial condition and affairs of each Borrower
and of other circumstances affecting the risk of nonpayment or
nonperformance of the Guaranteed Obligations. Each Guarantor is in a
position to obtain, and assumes full responsibility for obtaining, any
additional information about the financial condition and affairs of
each Borrower and of other circumstances affecting the risk of
nonpayment or nonperformance of the Guaranteed Obligations and will,
independently and without reliance upon Agent or any Lender, and based
on such documents and information as it shall deem appropriate at the
time, continue to make its own appraisals and decisions in taking or
not taking action in connection with this Guaranty.
4. SUBORDINATION. Each Guarantor hereby subordinates any and all debts,
liabilities and obligations owed to such Guarantor by each Borrower, including
all rights of such Guarantor against any Borrower arising as a result of
payments pursuant to Paragraph 2(a) of this Guaranty by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise (the
"Subordinated Obligations") to the Guaranteed Obligations as provided in this
Paragraph 4.
(a) Prohibited Payments, Etc. Except during the continuance of
a Default (including the commencement and continuation of any Debtor
Relief Proceeding relating to any Borrower), each Guarantor may receive
regularly scheduled payments from any Borrower on account of
Subordinated Obligations. After the occurrence and during the
continuance of any Default (including the commencement and continuation
of any Debtor Relief Proceeding relating to any Borrower), however,
unless Agent otherwise agrees, no Guarantor shall demand, accept or
take any action to collect any payment on account of the Subordinated
Obligations.
(b) Prior Payment of Guaranteed Obligations. In any Debtor
Relief Proceeding relating to any Borrower, each Guarantor agrees that
Agent and Lenders shall be entitled to receive payment of all
Guaranteed Obligations (including any and all Disallowed
Post-Commencement Interest and Expenses) before such Guarantor receives
payment of any Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the continuance
of any Default (including the commencement and continuation of any
Debtor Relief Proceeding relating to any Borrower), each Guarantor
shall, if Agent so requests, collect, enforce and receive payments on
account of the Subordinated Obligations as trustee for Agent and
Lenders and deliver such payments to Agent on account of the Guaranteed
Obligations (including any and all Disallowed Post-Commencement
Interest and Expenses), together with any necessary endorsements or
other instruments of transfer, but without reducing or affecting in any
manner the liability of such Guarantor under the other provisions of
this Guaranty.
(d) Agent Authorization. After the occurrence and during the
continuance of any Default (including the commencement and continuation
of any Debtor Relief Proceeding relating to any Borrower), Agent is
authorized and empowered (but in no way obligated), in its discretion,
(i) in the name of each Guarantor, to collect and enforce, and to
submit claims in respect of, Subordinated Obligations and to apply any
amounts received thereon to the Guaranteed Obligations (including any
and all Disallowed Post-Commencement Interest and Expenses), and (ii)
to require each Guarantor (A) to collect and enforce, and to submit
claims in respect of, Subordinated Obligations and (B) to pay any
amounts received on such obligations to Agent for application to the
Guaranteed Obligations (including any and all Disallowed
Post-Commencement Interest and Expenses).
5. CONTRIBUTION AMONG GUARANTORS. Guarantors desire to allocate among
themselves, in a fair and equitable manner, their rights of contribution from
each other when any payment is made by any Guarantor under this Guaranty.
Accordingly, if any payment is made by any Guarantor under this Guaranty (a
"Funding Guarantor") that exceeds its Fair Share, the Funding Guarantor shall be
entitled to a contribution from each other Guarantor in the amount of such other
Guarantor's Fair Share Shortfall, so that all such contributions shall cause
each Guarantor's Aggregate Guaranty Payments to equal its Fair Share. The
amounts payable as contributions hereunder shall be determined by the Funding
Guarantor as of the date on which the related payment or distribution is made by
the Funding Guarantor, and such determination shall be binding on the other
Guarantors absent manifest error. The
C-6
allocation and right of contribution among Guarantors set forth in this
Paragraph 5 shall not be construed to limit in any way the liability of any
Guarantor under this Guaranty or the amount of the Guaranteed Obligations.
6. MISCELLANEOUS.
(a) Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or
upon any Guarantor or Agent under this Guaranty or the other Credit
Documents shall be in writing and faxed, mailed or delivered, (i) if to
Agent, at its facsimile number or address set forth below, (ii) if to
any Guarantor, at its facsimile number or address set forth below its
signature below or in the respective Subsidiary Joinder for such
Guarantor or (iii) to such other facsimile number or address for Agent
or any Guarantor as indicated in any notice given by Agent or any
Guarantor, as the case may be, to the other parties to this Guaranty.
All such notices and communications shall be effective (i) when sent by
any overnight courier service of recognized standing, on the second
Business Day following the deposit with such service, (ii) when mailed
via the United States Postal Service, first class and postage prepaid,
upon receipt, (iii) when delivered by hand, upon delivery, and (iv)
when faxed, upon confirmation of receipt.
(a) Agent: ABN AMRO Bank N.V.
Syndications Group
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
U.S.A.
Attn: Xxxx Xxxxxxxx
Tel. No: (000) 000-0000
Fax. No: (000) 000-0000
With copies to:
ABN AMRO Bank N.V.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
U.S.A.
Attn: Xxxxxx Xxxxxx
Tel No: (000) 000-0000
Fax No: (000) 000-0000
(b) Payments.
(i) Each Guarantor shall make all payments of
the Guaranteed Obligations to Agent at the office of Agent and
at the times specified in the Credit Documents for the payment
of such Guaranteed Obligations. Each Guarantor shall make all
other payments hereunder at such office as Agent may
designate. Each payment shall be made in same-day or
immediately available funds not later than 2:00 p.m. (New York
City time) on the date due.
(ii) Each Guarantor shall make all payments of
the Guaranteed Obligations hereunder in the currency in which
such Guaranteed Obligations are required to be paid by any
Borrower pursuant to the Credit Documents and shall make all
other payments hereunder in Dollars; provided, however, that,
if Agent shall request a Guarantor to pay any amount hereunder
in the lawful currency of the United States which would
otherwise be payable in another currency, such Guarantor shall
pay to Agent the Dollar Equivalent of such amount.
(iii) If any sum due from any Guarantor under this
Guaranty or any other Credit Document to which such Guarantor
is a party or any order, judgment or award given or rendered
in relation hereto or thereto has to be converted from the
currency (the "first currency") in which the same is payable
hereunder or thereunder into another currency (the "second
currency") for the
C-7
purpose of (A) making or filing a claim or proof against such
Guarantor with any Governmental Authority, (B) obtaining an
order or judgment in any court or other tribunal or (C)
enforcing any order or judgment given or made in relation
hereto, such Guarantor shall, to the fullest extent permitted
by law, indemnify and hold harmless each of the Persons to
whom such sum is due from and against any loss suffered as a
result of any discrepancy between (1) the rate of exchange
used for such purpose to convert the amounts in question from
the first currency into the second currency and (2) the rate
or rates of exchange at which such Person may, using
reasonable efforts in the ordinary course of business,
purchase the first currency with the second currency upon
receipt of a sum paid to it in satisfaction, in whole or in
part, of any such order, judgment, claim or proof. The
foregoing indemnity shall constitute a separate obligation of
each Guarantor distinct from its other obligations hereunder
and shall survive the giving or making of any judgment or
order in relation to all or any of such obligations.
(iv) If any amounts required to be paid by any
Guarantor under this Guaranty or any order, judgment or award
given or rendered in relation hereto remain unpaid after such
amounts are due, such Guarantor shall pay interest on the
aggregate outstanding balance of such amounts from the date
due until those amounts are paid in full at a per annum rate
equal to:
(1) In the case of amounts payable in
Dollars, the Base Rate plus two percent (2.00%), such
rate to change from time to time as the Base Rate
shall change; or
(2) In the case of amounts payable in
any other currency, the Overnight Rate for such
currency plus three percent (3.00%), such rate to
change from time to time as the Overnight Rate shall
change.
(c) Expenses. Each Guarantor shall pay on demand (i) all
reasonable and documented fees and expenses, including reasonable
attorneys' fees and expenses, incurred by Agent in connection with the
preparation, execution and delivery of, and the exercise of its duties
under, this Guaranty and the preparation, execution and delivery of any
amendments and waivers hereunder and (ii) all reasonable and documented
fees and expenses, including reasonable attorneys' fees and expenses,
incurred by Agent and Lenders in connection with the enforcement or
attempted enforcement of this Guaranty or any of the Guaranteed
Obligations or in preserving any of Agent's or Lenders' rights and
remedies (including all such fees and expenses incurred in connection
with any "workout" or restructuring affecting the Credit Documents or
the Guaranteed Obligations or any bankruptcy or similar proceeding
involving such Guarantor, any other Guarantor, any Borrower, or any of
their respective affiliates).
(d) Waivers; Amendments. This Guaranty may not be amended or
modified, nor may any of its terms be waived, except by written
instruments signed by each Guarantor and Agent and subject to any
consent required in accordance with Paragraph 8.04 of the Credit
Agreement. Each waiver or consent under any provision hereof shall be
effective only in the specific instances for the purpose for which
given. No failure or delay on Agent's or any Lender's part in
exercising any right or power hereunder shall operate as a waiver
thereof or of any other right nor shall any single or partial exercise
of any such right or power, or any abandonment or discontinuance of
steps to enforce such right or power, preclude any other further
exercise thereof or of any other right or power.
(e) Successors and Assigns. This Guaranty shall be binding
upon and inure to the benefit of Agent, Lenders, Guarantors and their
respective successors and assigns; provided, however, that no Guarantor
may assign or transfer any of its rights and obligations under this
Guaranty without the prior written consent of Agent and Lenders, and
provided, further, that Agent or any Lender may sell, assign and
delegate their respective rights and obligations hereunder only as
permitted by the Credit Agreement. All references in this Guaranty to
any Person shall be deemed to include all permitted successors and
assigns of such Person.
(f) Cumulative Rights, etc. The rights, powers and remedies of
Agent and Lenders under this Guaranty shall be in addition to all
rights, powers and remedies given to Agent and Lenders by virtue of any
applicable law, rule or regulation of any Governmental Authority, the
Credit Agreement, any other
C-8
Credit Document or any other agreement, all of which rights, powers,
and remedies shall be cumulative and may be exercised successively or
concurrently without impairing Agent's or any Lender's rights
hereunder.
(g) Set-off; Security Interest.
(i) Upon the occurrence and during the
continuance of an Event of Default, in addition to any rights
and remedies of Lenders provided by law (including other
rights of set-off), each Lender shall have the right at any
time and from time to time, with prior notice to Agent but
without prior notice to or consent of any Guarantor, any such
notice and consent being expressly waived by each Guarantor to
the extent permitted by applicable law, to set-off and apply
against the obligations of each Guarantor any amount owing
from such Lender to such Guarantor. The aforesaid right of
set-off may be exercised by such Lender against a Guarantor or
against any trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, receiver or execution,
judgment or attachment creditor of such Guarantor or against
anyone else claiming through or against such Guarantor or such
trustee in bankruptcy, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or
attachment creditor, notwithstanding the fact that such right
of set-off may not have been exercised by such Lender at any
prior time. Each Lender agrees promptly to notify the
applicable Guarantor after any such set-off and application
made by such Lender, provided that the failure to give such
notice shall not affect the validity of such set-off and
application.
(ii) As security for the obligations of each
Guarantor hereunder, each Guarantor hereby grants to Agent and
each Lender, for the benefit of all Lenders, a continuing
security interest in any and all deposit accounts or moneys of
such Guarantor now or hereafter maintained with such Lender.
Each Lender shall have all of the rights of a secured party
with respect to such security interest.
(h) Payments Free of Taxes. All payments made by each
Guarantor under this Guaranty shall be made free and clear of, and
without deduction or withholding for or on account of, all present and
future Non-Excluded Taxes. If any Non-Excluded Taxes are required to be
withheld from any amounts payable to Agent or any Lender hereunder, the
amounts so payable to Agent or such Lender shall be increased to the
extent necessary to yield to Agent or such Lender (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Guaranty or
the other Credit Documents, as applicable. If under the laws of the
applicable jurisdiction, a payment by a Guarantor pursuant to this
Subparagraph 6(h) to Agent or any Lender may be made without deduction
or withholding of any Taxes (or with reduced deduction or withholding
of any Taxes), the Agent and such Lender (as applicable) shall, upon
written request by the applicable Guarantor, use reasonable efforts to
file with the appropriate tax authorities and deliver to Guarantor such
certificates and other evidence requested by Guarantor establishing
Agent's or Lender's entitlement to such eliminated or reduced
withholding. Whenever any Non-Excluded Taxes are payable by any
Guarantor, as promptly as possible thereafter, such Guarantor shall
send to Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt
received by such Guarantor showing payment thereof. If Guarantors fail
to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fail to remit to Agent the required receipts or other
required documentary evidence, Guarantors shall indemnify Agent and
Lenders for any taxes (including interest or penalties) that may become
payable by Agent or any Lender as a result of any such failure. The
obligations of Guarantors under this Subparagraph 6(h) shall survive
the payment and performance of the Guaranteed Obligations and the
termination of this Guaranty. Nothing contained in this Subparagraph
6(h) shall require Agent or any Lender to make available any of its tax
returns (or any other information relating to its taxes which Agent or
any Lender deems to be confidential).
(i) Partial Invalidity. If at any time any provision of this
Guaranty is or becomes illegal, invalid or unenforceable in any respect
under the law or any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions of this Guaranty nor the
legality, validity or enforceability of such provision under the law of
any other jurisdiction shall in any way be affected or impaired
thereby. The parties shall endeavor in good-faith negotiations to
replace any illegal, invalid or unenforceable
C-9
provisions with valid provisions the economic effect of which comes as
close as possible to that of any such illegal, invalid or unenforceable
provisions.
(j) Jury Trial. EACH OF GUARANTORS, LENDERS AND AGENT, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY
ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
GUARANTY.
(k) Counterparts. This Guaranty may be executed in any number
of identical counterparts, each of which shall be deemed to be an
original and any set of which signed by all the Guarantors shall be
deemed to constitute a complete, executed original for all purposes.
(l) Survival of Guaranty. All covenants, agreements,
representations and warranties made by any Borrower or any Guarantor in
the Credit Documents and in the certificates or other instruments
prepared or delivered in connection with or pursuant to this Guaranty
or any other Credit Document shall be considered to have been relied
upon by the Lenders and shall survive the execution and delivery of the
Credit Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any Lender
or on its behalf and notwithstanding that Agent, the Issuing Bank or
any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended under the
Credit Agreement, and shall continue in full force and effect until (A)
all the Guaranteed Obligations have been fully and indefeasibly paid in
cash, (B) the Lenders have no further commitment to lend under the
Credit Agreement, (C) the aggregate amount available for drawing under
all Letters of Credit outstanding and all Reimbursement Obligations
outstanding have been reduced to zero and (D) the Issuing Bank has no
further obligation to issue Letters of Credit under the Credit
Agreement.
(m) Governing Law, Consent to Jurisdiction, Etc.
(i) This Guaranty shall be governed by and
construed in accordance with the laws of the State of New
York.
(ii) Each Guarantor irrevocably submits to the
non-exclusive jurisdiction of the courts of the State of New
York and the courts of the United States of America located in
the City of New York. In addition, Each Guarantor agrees that
any legal action, suit or proceeding arising out of or
relating to this Guaranty or any of the other Credit Documents
may be brought against such party in any such courts. Final
judgment against a Guarantor in any such action, suit or
proceeding shall be conclusive and may be enforced in any
other jurisdiction by suit on the judgment, a certified or
exemplified copy of which shall be conclusive evidence of the
judgment, or in any other manner provided by law. Nothing in
this Subparagraph 6(m)(ii) shall affect the right of Agent or
any Lender to commence legal proceedings or otherwise xxx any
Guarantor in any other appropriate jurisdiction, or
concurrently in more than one jurisdiction, or to serve
process, pleadings and other papers upon any Guarantor in any
manner authorized by the laws of any such jurisdiction. Each
Guarantor agrees that process served either personally or by
registered mail shall, to the extent permitted by law,
constitute adequate service of process in any such suit.
Without limiting the foregoing, each Guarantor hereby
appoints, in the case of any such action or proceeding brought
in the courts of or in the State of New York, CT Corporation,
with offices on the date hereof at 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, to receive for it and on its behalf,
service of process in the State of New York with respect
thereto, provided that each Guarantor may appoint any other
person, reasonably acceptable to Agent, with offices in the
State of New York to replace such agent for service of process
upon delivery to Agent of a reasonably acceptable agreement of
such new agent agreeing so to act. Each Guarantor irrevocably
waives to the fullest extent permitted by applicable law (A)
any objection which it may have now or in the future to the
laying of the venue of any such action, suit or proceeding in
any court referred to in the first sentence of this
Subparagraph 6(m)(ii) above, (B) any claim that any such
action, suit or proceeding has been brought in an inconvenient
forum, (C) its right of removal of any matter commenced by any
other party in the courts of the State of New York to any
court of the United
C-10
States of America, (D) any immunity which it or its assets may
have in respect of its obligations under this Agreement or any
other Credit Document from any suit, execution, attachment
(whether provisional or final, in aid of execution, before
judgment or otherwise) or other legal process, and (E) any
right it may have to require the moving party in any suit,
action or proceeding brought in any of the courts referred to
above arising out of or in connection with this Agreement or
any other Credit Document to post security for the costs of
any Guarantor or to post a bond or to take similar action.
7. LIMITATION ON GUARANTEE BY FLEXTRONICS MANUFACTURING FRANCE
(a) The liability of Flextronics Manufacturing France under this
Guaranty shall be limited at any time to 50% of the greater of:
(i) the Net Asset Value of Flextronics Manufacturing
France calculated on the basis of its audited financial statements
dated as of March 31, 2003; and
(ii) the Net Asset Value of the Flextronics Manufacturing
France calculated on the basis of its audited financial statements
available at the date on which demand is made pursuant to this
Guaranty.
(b) For the purposes of Subparagraph (a) above, "Net Asset Value" of
Flextronics Manufacturing France means the capitaux propres (as defined in
article 22 of the French decree no. 83-1020 of November 29, 1983) of Flextronics
Manufacturing France. A certificate of the statutory auditors of the Flextronics
Manufacturing France as to the Net Asset Value shall be conclusive evidence as
to the amount to which it relates.
(c) The limitations set forth in this Paragraph 7 with respect to
Flextronics Manufacturing France shall in no way limit the Guaranty of any other
Guarantor hereunder. Without limiting Subparagraph 6(i), if at any time the
Guaranty of Flextronics Manufacturing France is or becomes illegal, invalid or
unenforceable in any respect, neither the legality, validity or enforceability
of this Guaranty against the other Guarantors shall in any way be affected or
impaired thereby.
[The first signature page follows.]
C-11
SIGNATURE PAGE
TO FIL GUARANTY
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed as of the day and year first above written.
Name of Guarantor:___________________________________
By:________________________________________
Name:___________________________________
Title:__________________________________
Address:
[___________________________________]
[___________________________________]
[___________________________________]
Attn: [__________________________________]
Telephone:[______________________________]
Facsimile: [_____________________________]
SIGNATURE PAGE
TO FIL GUARANTY
ABN AMRO BANK N.V.,
As Agent
By:________________________________________
Name:___________________________________
Title:__________________________________
By:________________________________________
Name:___________________________________
Title:__________________________________
ATTACHMENT 1
SUBSIDIARY JOINDER
THIS SUBSIDIARY JOINDER (this "Agreement"), dated as of ____________,
____, is executed by [NEW ELIGIBLE MATERIAL SUBSIDIARY OR OTHER SUBSIDIARY], a
_________ [insert type of entity] ("New Subsidiary") in favor of ABN AMRO BANK
N.V., acting as agent (in such capacity, and each successor thereto in such
capacity, "Agent") for the financial institutions which are from time to time
parties to the Credit Agreement referred to in Recital A below (collectively,
the "Lenders").
RECITALS
A. Pursuant to a Credit Agreement dated as of March 3, 2004 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Flextronics International Ltd. ("FIL"), each of the Subsidiaries of FIL
designated as borrower from time to time in accordance with the Credit Agreement
(collectively, "Designated Borrowers"), Lenders, Fleet National Bank, as Issuing
Bank, and Agent. Lenders have agreed to extend credit to FIL and Designated
Borrowers (together, "Borrowers") upon the terms and subject to the conditions
set forth therein. Each Guarantor is a Subsidiary of FIL, expects to derive
substantial direct and indirect benefit from the transactions contemplated by
the Credit Agreement and is willing to execute and deliver this Subsidiary
Joinder to induce the Lenders to enter into the transactions contemplated by the
Credit Agreement.
B. Lenders' obligations to extend credit to Borrowers under the Credit
Agreement are subject, among other conditions, to receipt by Agent of (1) a
Guaranty, dated as of March 3, 2004, duly executed by each existing Eligible
Material Subsidiary and each other Subsidiary required to execute the Guaranty
pursuant to Subparagraph 2.15(c) of the Credit Agreement, and (2) Subsidiary
Joinders, duly executed by each future Eligible Material Subsidiary and each
other Subsidiary required to execute the Subsidiary Joinder pursuant to
Subparagraph 2.15(c) of the Credit Agreement.
C. New Subsidiary is a new Eligible Material Subsidiary or other
Subsidiary, expects to derive substantial direct and indirect benefit from the
transactions contemplated by the Credit Agreement and is willing to execute and
deliver this Subsidiary Joinder to induce the Lenders to enter into the
transactions contemplated by the Credit Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, New Subsidiary hereby agrees with Agent, for the ratable benefit
of the Lenders and Agent, as follows:
1. DEFINITIONS AND INTERPRETATION. Unless otherwise defined herein, all
capitalized terms used herein and defined in the Guaranty shall have the
respective meanings given to those terms in the Guaranty. New Subsidiary
acknowledges receipt of copies of the Guaranty, the Credit Agreement and the
other Credit Documents.
2. REPRESENTATIONS AND WARRANTIES. On and as of the date of this Agreement
(the "Effective Date") and for the ratable benefit of Agent and the Lenders, New
Subsidiary hereby makes each of the representations and warranties made by each
Guarantor in the Guaranty.
3. AGREEMENT TO BE BOUND. New Subsidiary agrees that, on and as of the
Effective Date, it shall become a Guarantor under the Guaranty and shall be
bound by all the provisions of the Guaranty to the same extent as if New
Subsidiary had executed the Guaranty on the Closing Date. Each reference to a
"Guarantor" in the Guaranty shall be deemed to include the New Subsidiary.
4. WAIVER. Without limiting the generality of the waivers in the Guaranty,
New Subsidiary specifically agrees to be bound by the Guaranty and waives any
right to notice of acceptance of its execution of this Agreement and of its
agreement to be bound by the Guaranty.
D-1
5. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
6. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which, when
taken together, shall constitute one agreement.
7. NOTICE. All communications and notices hereunder shall be given as
provided in Paragraph 6(a) of the Guaranty.
8. EXPENSES. The New Subsidiary agrees to reimburse Agent for its
reasonable out-of-pocket expenses in connection with this Agreement, including
the reasonable fees, other charges and disbursements of counsel for the Agent.
9. GUARANTY. Except as expressly supplemented hereby, the Guaranty shall
remain in full force and effect.
D-2
IN WITNESS WHEREOF, New Subsidiary has caused this Agreement to be
executed by its duly authorized officer.
[NEW SUBSIDIARY]
By:________________________________________
Name:___________________________________
Title:__________________________________
Address:
[___________________________________]
[___________________________________]
[___________________________________]
Attn: [__________________________________]
Telephone: [(___) ___-____]
Facsimile: [(___) ___-____]
ABN AMRO BANK N.V.,
As Agent
By:________________________________________
Name:___________________________________
Title:__________________________________
D-3
EXHIBIT D
[FORM OF]
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the "Assignment and Assumption") is
dated as of the Assignment Effective Date set forth below and is entered into by
and between [Insert name of Assignor Lender] (the "Assignor Lender") and [Insert
name of Assignee Lender] (the "Assignee Lender"). Capitalized terms used but not
defined herein shall have the meanings given to them in the Credit Agreement
identified below (as amended from time to time, the "Credit Agreement"), receipt
of a copy of which is hereby acknowledged by the Assignee Lender. The Standard
Terms and Conditions set forth in Attachment 1 attached hereto are hereby agreed
to and incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.
For an agreed consideration, the Assignor Lender hereby irrevocably
sells and assigns to the Assignee Lender, and the Assignee Lender hereby
irrevocably purchases and assumes from the Assignor Lender, subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Assignment Effective Date inserted by the Agent as contemplated below,
(i) all of the Assignor Lender's rights and obligations in its capacity as a
Lender under the Credit Agreement and the other Credit Documents to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor Lender (including any Letters
of Credit or Guaranties) and (ii) to the extent permitted to be assigned under
applicable law, all claims, suits, causes of action and any other right of the
Assignor Lender (in its capacity as a Lender) against any Person, whether known
or unknown, arising under or in connection with the Credit Agreement, any other
Credit Document or the Loans and other transactions governed thereby or in any
way based on or related to any of the foregoing, including, but not limited to,
contract claims, tort claims, malpractice claims, statutory claims and all other
claims at law or in equity related to the rights and obligations sold and
assigned pursuant to clause (i) above (the rights and obligations sold and
assigned pursuant to clauses (i) and (ii) above being referred to herein
collectively as the "Assigned Interest"). Such sale and assignment is without
recourse to the Assignor Lender and, except as expressly provided in this
Assignment and Assumption, without representation or warranty by the Assignor
Lender.
1. Assignor Lender: ______________________________
2. Assignee Lender: ________________________________
3. Borrower: [Flextronics International Limited]
4. Agent: ABN AMRO Bank N.V., as agent under the Credit
Agreement
5. Credit Agreement: Credit Agreement dated as of March 3, 2004 (as
amended, supplemented or otherwise modified from time
to time), among Flextronics International Ltd.
("FIL"), each of the Subsidiaries of FIL designated
as borrower from time to time in accordance with the
Credit Agreement (collectively, the "Designated
Borrowers"), Lenders, Fleet National Bank, as Issuing
Bank, and Agent.
6. Assigned Interest: See Attachment 2.
[7. Assignment Effective Date: ______________](1)
Assignment Effective Date: _____________ ___, 20___ [TO BE INSERTED BY AGENT AND
WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed to:
----------------------
(1) To be completed if the Assignor Lender and the Assignee Lender intend
that the minimum assignment amount is to be determined as of the Trade Date.
D-4
ASSIGNOR LENDER
[NAME OF ASSIGNOR]
By:______________________________
Title:
ASSIGNEE LENDER
[NAME OF ASSIGNEE]
By:______________________________
Title:
[Consented to and](2) Accepted:
[NAME OF AGENT], as Agent
By_________________________________
Title:
[Consented to:](3)
[NAME OF RELEVANT PARTY]
By________________________________
Title:
------------------------
(2) To be added only if the consent of the Agent is required by the
terms of the Credit Agreement.
(3) To be added only if the consent of the Borrower and/or other
parties (e.g., Issuing Bank) is required by the terms of the Credit Agreement.
D-5
ATTACHMENT 1
TO ASSIGNMENT AND ASSUMPTION
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor Lender. The Assignor Lender (a) represents and warrants
that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any collateral thereunder, (iii) the
financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Credit Document or any Obligation
or (iv) the performance or observance by the Borrower, any of its Subsidiaries
or Affiliates or any other Person of any of their respective Obligations under
any Credit Document.
1.2. Assignee Lender. The Assignee Lender (a) represents and warrants
that (i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee Lender under
the Credit Agreement (subject to receipt of such consents as may be required
under the Credit Agreement), (iii) from and after the Assignment Effective Date,
it shall be bound by the provisions of the Credit Agreement as a Lender
thereunder and, to the extent of the Assigned Interest, shall have the
obligations of a Lender thereunder, (iv) it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 5.01 thereof, as applicable, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Assumption and to
purchase the Assigned Interest on the basis of which it has made such analysis
and decision independently and without reliance on the Agent or any other
Lender, and (v) if it is a lender not organized under the laws of the United
States, attached to the Assignment and Assumption is any documentation required
to be delivered by it pursuant to Section 2.13(b) of the Credit Agreement, duly
completed and executed by the Assignee Lender; and (b) agrees that (i) it will,
independently and without reliance on the Agent, the Assignor Lender or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Documents are required to be performed by it as a Lender.
2. Payments. From and after the Assignment Effective Date, the Agent
shall make all payments in respect of the Assigned Interest (including payments
of principal, interest, fees and other amounts) to the Assignor Lender for
amounts which have accrued to but excluding the Assignment Effective Date and to
the Assignee Lender for amounts which have accrued from and after the Assignment
Effective Date.4
3. General Provisions. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
-------------------
(4) The Agent should consider whether this method conforms to its
systems. In some circumstances, the following alternative language may be
appropriate: "From and after the Assignment Effective Date, the Agent shall make
all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignee Lender whether such
amounts have accrued prior to, on or after the Assignment Effective Date. The
Assignor Lender and the Assignee Lender shall make all appropriate adjustments
in payments by the Agent for periods prior to the Assignment Effective Date or
with respect to the making of this assignment directly between themselves."
D-6
executed in any number of counterparts, each of which shall be deemed an
original and all of which shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.
D-7
ATTACHMENT 2
TO ASSIGNMENT AND ASSUMPTION
PART A
______________________________________________________________________________________
______________________________________________________________________________________
Commitments or Loans Assigned Commitments or Loans After
Assignor Lender: Assignment
---------------
______________ $____________ $____________
Assignee Lenders:
----------------
______________ $____________ $____________
______________ $____________ $____________
______________ $____________ $____________
______________ $____________ $____________
D-8
PART B
[ASSIGNEE LENDER]
Domestic Lending Office:
[________________________],
[________________________],
[________________________],
Eurodollar Lending Office:
[________________________],
[________________________],
[________________________],
Address for Notices:
Wiring Instructions:
D-9
