CREDIT AGREEMENT
Dated as of January 14, 1999
among
STORAGE TECHNOLOGY CORPORATION,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent,
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
Arranged by
NATIONSBANC XXXXXXXXXX SECURITIES LLC
TABLE OF CONTENTS
Section Page
Article I DEFINITIONS 1
1.1 Certain Defined Terms 1
1.2 Other Interpretive Provisions 15
1.3 Accounting Principles. 16
Article II THE CREDITS 16
2.1 Amounts and Terms of Commitment 16
2.2 Loan Accounts 17
2.3 Procedure for Borrowing 17
2.4 Conversion and Continuation Elections 18
2.5 Voluntary Termination or Reduction of Commitments 20
2.6 Optional Prepayments 20
2.7 Repayment 20
2.8 Interest 21
2.9 Fees 22
2.10 Computation of Fees and Interest 23
2.11 Payments by the Borrower 23
2.12 Payments by the Banks to the Agent 24
2.13 Sharing of Payments, Etc 24
Article III TAXES, YIELD PROTECTION AND ILLEGALITY 25
3.1 Taxes 25
3.2 Illegality 26
3.3 Increased Costs and Reduction of Return 27
3.4 Funding Losses 28
3.5 Inability to Determine Rates 28
3.6 Survival 28
3.7 Notice of Claims 29
Article IV CONDITIONS PRECEDENT 29
4.1 Conditions to Agreement 29
4.2 Conditions to All Credit Extensions 30
Article V REPRESENTATIONS AND WARRANTIES 31
5.1 Corporate Existence and Power 31
5.2 Corporate Authorization; No Contravention 32
5.3 Governmental Authorization 32
5.4 Binding Effect 32
5.5 Litigation 32
5.6 No Default. 33
5.7 ERISA Compliance 33
5.8 Use of Proceeds; Margin Regulations 33
5.9 Title to Properties; Liens 34
5.10 Taxes 34
5.11 Financial Condition 34
5.12 Environmental Matters 35
5.13 Regulated Entities 35
5.14 Copyrights, Patents, Trademarks and Licenses, Etc. 35
5.15 Subsidiaries 35
5.16 Insurance 36
5.17 Full Disclosure 36
5.18 Projections 36
Article VI AFFIRMATIVE COVENANTS 37
6.1 Financial Statements 37
6.2 Certificates; Other Information 37
6.3 Notices 38
6.4 Preservation of Corporate Existence, Etc. 38
6.5 Maintenance of Property 38
6.6 Insurance 39
6.7 Payment of Obligations 39
6.8 Compliance with Laws 39
6.9 Compliance with ERISA 39
6.10 Inspection of Property and Books and Records 39
6.11 Use of Proceeds 40
6.12 Disclosure; Further Assurances 40
6.13 Financial Covenants 40
6.14 Patents and Permits 42
Article VII NEGATIVE COVENANTS 42
7.1 Limitation on Liens 42
7.2 Disposition of Assets 44
7.3 Consolidations and Mergers 45
7.4 Loans and Investments 45
7.5 Transactions with Affiliates 46
7.6 Use of Proceeds 47
7.7 Contingent Obligations 47
7.8 Restricted Payments 47
7.9 ERISA 48
7.10 Change in Business 48
7.11 Accounting Changes 48
Article VIII EVENTS OF DEFAULT 48
8.1 Event of Default 48
8.2 Remedies 51
8.3 Certain Financial Covenant Defaults 51
Article IX THE AGENT 52
9.1 Appointment and Authorization; "Agent" 52
9.2 Delegation of Duties 52
9.3 Liability of Agent 52
9.4 Reliance by Agent 53
9.5 Notice of Default 53
9.6 Credit Decision 54
9.7 Indemnification of Agent 54
9.8 Agent in Individual Capacity 54
9.9 Successor Agent 55
9.10 Withholding Tax 55
9.11 Co-Agents. 57
Article X MISCELLANEOUS 57
10.1 Amendments and Waivers 57
10.2 Notices 58
10.3 No Waiver; Cumulative Remedies 58
10.4 Costs and Expenses 59
10.5 Borrowe's Indemnification 59
10.6 Payments Set Aside 60
10.7 Successors and Assigns 60
10.8 Assignments, Participations, Etc. 60
10.9 Confidentiality 62
10.10 Set-off 62
10.11 Automatic Debits of Fees 63
10.12 Notification of Addresses, Lending Offices, Etc. 63
10.13 Counterparts 63
10.14 Severability 63
10.15 No Third Parties Benefited 63
10.16 Governing Law and Jurisdiction 63
10.17 Waiver of Jury Trial 64
10.18 Entire Agreement 64
SCHEDULES
Schedule 2.1 Commitments and Pro Rata Shares
Schedule 2.8(e) Applicable Margin and Commitment Fees
Schedule 5.5 Litigation
Schedule 5.11 Permitted Liabilities
Schedule 5.12 Environmental Matters
Schedule 5.15 Subsidiaries and Minority Interests
Schedule 5.16 Insurance Matters
Schedule 7.1(i) Permitted Liens
Schedule 7.2 Permitted Dispositions
Schedule 7.4(f) Permitted Investments
Schedule 7.7(e) Contingent Obligations
Schedule 10.2 Addresses for Notices; Lending Offices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D-1 Form of Legal Opinion of Shearman & Sterling
Exhibit D-2 Form of Legal Opinion of Internal Borrower's Counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F Form of Promissory Note
1
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of January 14, 1999, among
Storage Technology Corporation, a Delaware corporation ( "the Borrower"), the
several financial institutions from time to time party to this Credit
Agreement (individually, a "Bank"; collectively, the "Banks"), ABN AMRO Bank
N.V., Bank of Montreal, The Bank of Nova Scotia, Fleet National Bank and
KeyBank National Association, as co-agents, and Bank of America National
Trust and Savings Association, as agent for the Banks.
The Borrower has requested the Banks to make revolving loans to the
Borrower in an aggregate principal amount of up to $150,000,000 at any time
outstanding. The Bank is willing to make such loans to the Borrower upon the
terms and subject to the conditions set forth in this Agreement.
Accordingly, the parties hereto agree as follows:
article I
DEFINITIONS
1.1 Certain Defined Terms. The following terms have the following meanings:
"$350MM Credit Agreement" means that certain Credit Agreement
dated October 23, 1997 (as amended, restated, modified, supplemented or
renewed from time to time) by and among the Borrower, the several
financial institutions from time to time party thereto and Bank of
America National Trust and Savings Association, as agent for such
financial institutions.
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or indirectly,
in (a) the acquisition of all or substantially all of the assets of a
Person, or of any business or division of a Person, (b) the acquisition
of in excess of 50% of the capital stock, partnership interests,
membership interests or equity of any Person, or otherwise causing any
Person to become a Subsidiary, or (c)a merger or consolidation or any
other combination with another Person (other than a Person that is a
Subsidiary) provided that the Borrower or its Subsidiary is the
surviving entity.
"Adjusted Quick Ratio" means, for any Person for any period, the
ratio that (i) Current Liquid Assets of such Person bears to
(ii) Current Liabilities of such Person.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or
indirectly, the power to direct or cause the direction of the
management and policies of the other Person, whether through the
ownership of voting securities, membership interests, by contract, or
otherwise.
2
"Agent" means BofA in its capacity as agent for the Banks
hereunder, and any successor agent arising under Section 9.9.
"Agent-Related Persons" means BofA and any successor agent
arising under Section 9.9, together with their respective Affiliates
(including, in the case of BofA, the Arranger), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agent's Payment Office" means the address for payments set forth
on Schedule 10.2 or such other address as the Agent may from time to
time specify.
"Agreement" means this Credit Agreement.
"Applicable Fee Amount" means with respect to the commitment fee
payable hereunder, the amount set forth opposite the indicated level
below the heading "Commitment Fee" in the pricing grid set forth on
Schedule 2.8(e) in accordance with the parameters for calculations of
such amount set forth in Sections 2.8(e).
"Applicable Margin" means the amount set forth opposite the
indicated level below the heading "Base Rate Spread" or "Offshore Rate
Spread," as appropriate, in the pricing grid set forth in
Schedule 2.8(e) in accordance with the parameters for calculations of
such amount also set forth in Sections 2.8(e).
"Arranger" means NationsBanc Xxxxxxxxxx Securities LLC.
"Assignee" has the meaning specified in subsection 10.8(a).
"Attorney Costs" means and includes all fees and disbursements of
any law firm or other external counsel, the allocated cost of internal
legal services and all disbursements of internal counsel.
"Bank" has the meaning specified in the introductory clause
hereto.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. S101, et seq.)
"Base Rate" means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate; and (b) the rate of interest
in effect for such day as publicly announced from time to time by BofA
in San Francisco, California, as its "reference rate." (The "reference
rate" is a rate set by BofA based upon various factors including BofA's
costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate.)
Any change in the reference rate announced by BofA shall take
effect at the opening of business on the day specified in the public
announcement of such change.
3
"Base Rate Loan" means a Revolving Loan, that bears interest
based on the Base Rate.
"BofA" means Bank of America National Trust and Savings
Association, a national banking association.
"Borrower" has the meaning specified in the introductory clause
of this Agreement.
"Borrowing" means a borrowing hereunder consisting of Revolving
Loans of the same Type made to the Borrower on the same day by the
Banks under Article II.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.3.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banks in New York City or San Francisco
are authorized or required by law to close and, if the applicable
Business Day relates to any Offshore Rate Loan, means such a day on
which dealings are carried on in the applicable offshore Dollar
interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law,
in each case, regarding capital adequacy of any bank or of any
corporation controlling a bank.
"Capital Lease" means, for any Person, any lease of property
(whether real, personal or mixed) which, in accordance with GAAP,
would, at the time a determination is made, be required to be recorded
as a capital lease in respect of which such Person is liable as lessee.
"Change of Control" means the occurrence, after the date of this
Agreement, of any of the following: (a) any Person or two or more
Persons acting in concert acquiring beneficial ownership (within the
meaning of Rule 13d-3 of the SEC under the Exchange Act), directly or
indirectly, of securities of the Borrower (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Borrower entitled to
vote in the election of directors; or (b) during any period of up to
12 consecutive months, commencing after the Closing Date, individuals
who at the beginning of such 12-month period were directors of the
Borrower ceasing for any reason to constitute a majority of the Board
of Directors of the Borrower unless the Persons replacing such
individuals were nominated by the Board of Directors of the Borrower;
or (c) any Person or two or more Persons acting in concert acquiring by
contract or otherwise, or entering into a contract or arrangement which
upon consummation will result in its or their acquisition of, or
control over, securities of the Borrower (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Borrower entitled to
vote in the election of directors.
4
"Closing Date" means the date on which all conditions precedent
set forth in Section 4.1 are satisfied or waived by all Banks (or, in
the case of subsection 4.1(e), waived by the Person entitled to receive
such payment).
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Commitment," as to each Bank, has the meaning specified in
Section 2.1.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit C.
"Consolidated" and any derivative thereof each means, with
reference to the accounts or financial reports of any Person, the
consolidated accounts or financial reports of such Person and each
Subsidiary of such Person determined in accordance with GAAP.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation (the "primary
obligations") of another Person (the "primary obligor"), including any
obligation of that Person (i) to purchase, repurchase or otherwise
acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such
primary obligation, or 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, (iii) 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 otherwise to assure or hold harmless the
holder of any such primary obligation against loss in respect thereof;
(b) with respect to primary obligations of a primary obligor in
connection with any synthetic lease or similar off balance sheet lease
transaction or securitization transaction (each of (a) and (b) a
"Guaranty Obligation"), (c) with respect to 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; (d) to
purchase any materials, supplies or other property from, or to obtain
the services of, another Person if the primary purpose of the contract
or other related document or obligation requires that payment for such
materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or
other property is ever made or tendered, or such services are ever
performed or tendered, or (e) in respect of any Swap Contract. The
amount of any Contingent Obligation shall, in the case of Guaranty
Obligations, 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, and in the case of other
Contingent Obligations, shall be equal to the maximum reasonably
anticipated liability in respect thereof.
5
"Contractual Obligation" means, as to any Person, any provision
of any security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument,
document or agreement to which such Person is a party or by which it or
any of its property is bound.
"Conversion/Continuation Date" means any date on which, under
Section 2.4, the Borrower (a) converts Loans of one Type to another
Type, or (b) continues as Loans of the same Type, but with a new
Interest Period, Loans having Interest Periods expiring on such date.
"Credit Extension" means and includes the making of any Revolving
Loans.
"Current Liabilities" of any Person means, as of any date of
determination, all liabilities of such Person (including estimated
accrued taxes and any Indebtedness outstanding under the $350MM Credit
Agreement but excluding any obligations under the Multicurrency Note
Purchase Facility which are fully cash collateralized) which in
accordance with GAAP should be classified as current liabilities of
such Person, including the amount of any redeemable preferred stock of
such Person that is redeemable for cash at the option of the holder
thereof or that is mandatorily redeemable by such Person within one
year of such date of determination, valued at the applicable redemption
price, plus accrued and unpaid dividends payable in respect of such
redeemable preferred stock.
"Current Liquid Assets" of any Person means, as of any date of
determination, all cash, short-term investments and accounts
receivable, in each case as shown on the most recent balance sheet of
such Person and determined in accordance with GAAP (but excluding any
such assets deposited to collateralize any obligations under the
Multicurrency Note Purchase Facility).
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
"Dollars," "dollars" and "$" each mean lawful money of the United
States.
"EBITDA" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, determined in accordance with
GAAP, the sum of (a) the Net Income (or Net Loss) for such period plus
(b) all amounts treated as expenses for depreciation, interest and the
amortization of intangibles of any kind to the extent included in the
determination of such Net Income (or Net Loss), plus (c) all accrued
taxes on or measured by income to the extent included in the
determination of such Net Income (or Net Loss).
"Effective Amount" means with respect to any Revolving Loans, on
any date, the aggregate outstanding principal amount thereof after
giving effect to any Borrowings and prepayments or repayments of
Revolving Loans occurring on such date.
6
"Eligible Assignee" means (a) a commercial bank organized under
the laws of the United States, or any state thereof, and having a
combined capital and surplus of at least $200,000,000; (b) a commercial
bank organized under the laws of any other country which is a member of
the Organization for Economic Cooperation and Development (the "OECD"),
or a political subdivision of any such country, and having a combined
capital and surplus of at least $200,000,000, provided that such bank
is acting through a branch or agency located in the United States; and
(c) a Person that is primarily engaged in the business of commercial
banking and that is (i) a Subsidiary of a Bank, (ii) a Subsidiary of a
Person of which a Bank is a Subsidiary, or (iii) a Person of which a
Bank is a Subsidiary.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release
or injury to the environment.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental,
health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning
of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of
the Code for purposes of provisions relating to Section 412 of the
Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan year
in which it was a substantial employer (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations which is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) a
complete or partial withdrawal by the Borrower or any ERISA Affiliate
from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of a Plan amendment as a termination under Section 4041
or 4041A of ERISA, or the commencement of proceedings by the PBGC to
terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer Plan; or
(f) the imposition of any liability under Title IV of ERISA, other than
PBGC premiums due but not delinquent under Section 4007 of ERISA, upon
the Borrower or any ERISA Affiliate.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate."
7
"Event of Default" means any of the events or circumstances
specified in Section 8.1.
"Exchange Act" means the Securities Exchange Act of 1934.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of New
York with respect to the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is
not so published with respect to any such preceding Business Day, the
rate for such day will be the arithmetic mean as determined by the
Agent of the rates for the last transaction in overnight Federal funds
arranged prior to 9:00 a.m. (New York City time) on that day by each of
three leading brokers of Federal funds transactions in New York City
selected by the Agent.
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"GAAP" means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date
of determination.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guaranty Obligation" has the meaning specified in the definition
of "Contingent Obligation."
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken
or assumed as the deferred purchase price of property or services
(other than trade payables entered into in the ordinary course of
business on ordinary terms); (c) all reimbursement or payment
obligations (contingent or otherwise) with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in
connection with the acquisition of property, assets or businesses;
(e) all indebtedness created or arising under any conditional sale or
other title retention agreement, or incurred as financing, in either
case with respect to property
8
acquired by the Person (even though the
rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such property);
(f) all obligations with respect to Capital Leases; (g) all
indebtedness referred to in clauses (a) through (f) above secured by
(or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon or in property
(including accounts and contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such Indebtedness; and (h) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in
clauses (a) through (g) above.
"Indemnified Liabilities" has the meaning specified in
Section 10.5.
"Indemnified Person" has the meaning specified in Section 10.5.
"Independent Auditor" has the meaning specified in
subsection 7.1(a).
"Insolvency Proceeding" means, with respect to any Person,
(a) any case, action or proceeding with respect to such Person before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the
benefit of creditors, composition, marshalling of assets for creditors,
or other, similar arrangement in respect of its creditors generally or
any substantial portion of its creditors; in either case undertaken
under U.S. Federal, state or foreign law, including the Bankruptcy Code.
"Interest Payment Date" means, (a) as to any Loan other than a
Base Rate Loan, the last day of each Interest Period applicable to such
Loan and (b) as to any Base Rate Loan, the last Business Day of each
calendar quarter; provided, however, that if any Interest Period for an
Offshore Rate Loan exceeds three months, the date that falls three
months after the beginning of such Interest Period and after each
Interest Payment Date thereafter is also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two,
three or six months thereafter as selected by the Borrower in its
Notice of Borrowing or Notice of Conversion/Continuation; provided that:
(a) if any Interest Period would otherwise end on a day that is not a
Business Day, that Interest Period shall be extended to the
following Business Day unless the result of such extension
would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall
end on the preceding Business Day;
(b) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such
Interest
9
Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period; and
(c) no Interest Period for any Loan shall extend beyond the Revolving
Termination Date.
"Investments" has the meaning specified in Section 7.4.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Joint Venture" means a single-purpose corporation, partnership,
limited liability company, joint venture or other similar legal
arrangement (whether created by contract or conducted through a
separate legal entity) now or hereafter formed by the Borrower or any
of its Subsidiaries with another Person in order to conduct a common
venture or enterprise with such Person.
"Lending Office" means, as to any Bank, the office or offices of
such Bank specified as its "Lending Office" on Schedule 10.2, or such
other office or offices as such Bank may from time to time notify the
Borrower and the Agent.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of
any kind or nature whatsoever in respect of any property (including
those created by, arising under or evidenced by any conditional sale or
other title retention agreement, the interest of a lessor under a
Capital Lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as
debtor, under the Uniform Commercial Code or any comparable law) and
any contingent or other agreement to provide any of the foregoing, but
not including the interest of a lessor under an Operating Lease.
"Loan" means an extension of credit by a Bank to the Borrower
under Article II in the form of a Revolving Loan.
"Loan Documents" means this Agreement, any Notes and all other
documents delivered to the Agent or any Bank in connection herewith.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change in,
or a material adverse effect upon, the operations, business,
properties, condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Borrower to perform under any Loan
Document and to avoid any Event of Default; or (c) a material adverse
effect upon the legality, validity, binding effect or enforceability
against the Borrower of any Loan Document.
10
"Material Subsidiary" means any Subsidiary that at any time
either (a) owns or holds title to 5% or more of the Consolidated assets
of the Borrower and its Consolidated Subsidiaries or (b) accounts for
5% or more of the Consolidated revenue of the Borrower and its
Consolidated Subsidiaries, in each case as determined in accordance
with GAAP.
"Multicurrency Note Purchase Facility" means the facility
pursuant to the Second Amended and Restated Contingent Multicurrency
Note Purchase Commitment Agreement dated as of January 15, 1998 (as
amended, restated, modified or supplemented from time to time) between
Borrower and BofA, whereby BofA has agreed to purchase certain notes of
the Borrower subject, in certain cases, to collateralization in cash
and other investments or any similar facility designed to accomplish
the same objectives.
"Multiemployer Plan" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which the Borrower or any
ERISA Affiliate makes, is making, or is obligated to make contributions
or, during the preceding three calendar years, has made, or been
obligated to make, contributions.
"Net Income" means, with respect to any Person for any period,
net income of such Person, as determined by such Person in accordance
with GAAP.
"Net Loss" means, with respect to any Person for any period,
negative Net Income of such Person, as determined by such Person in
accordance with GAAP.
"Note" means a promissory note executed by the Borrower in favor
of a Bank pursuant to subsection 2.2(b), in substantially the form of
Exhibit F.
"Notice of Borrowing" means a notice in substantially the form of
Exhibit A.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means all advances, debts, liabilities,
obligations, covenants and duties arising under any Loan Document owing
by the Borrower to any Bank, the Agent, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter
arising.
"Offshore Rate": For any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate
equal to (A) (i) the rate of interest per annum determined by the Agent
to be the rate of interest per annum appearing on Telerate display
page 3750 (or such other display page on the Telerate System as may
replace such page) for Dollar deposits in an amount substantially equal
to the proposed Offshore Rate Loan to be made, continued or converted
by Agent, in its individual capacity, and having a maturity comparable
to such Interest Period, at approximately 11:00 a.m. (London time) two
Business Days prior to the commencement of such Interest Period,
subject to clause (ii) below; or (ii) if for any reason the rate is not
available as
11
provided in the preceding clause (i) of this definition,
the "Offshore Rate" instead means the rate of interest per annum
determined by the Agent (rounded to the next higher 1/16 of 1%) to be
the rate at which deposits in Dollars are offered to prime banks by the
principal office of BofA in the London interbank market, at
approximately 11:00 a.m. (London time), two Business Days before the
first day of such Interest Period, in the approximate amount of the
Offshore Rate Loan to be made by BofA and for a period of time
comparable to such Interest Period; divided by (B) a number equal to
1.00 minus the aggregate (but without duplication) of the rate
(expressed as a decimal fraction) of reserve requirements in effect on
the day which is two Business Days prior to the commencement of such
Interest Period (including basic, supplemental, marginal and emergency
reserves under any regulations of the Board of Governors of the Federal
Reserve System or other governmental authority having jurisdiction with
respect thereto, as in effect at the time BofA quotes its rate to the
Agent) for Eurocurrency funding of domestic assets (currently referred
to as "Eurocurrency liabilities" in Regulation D of such Board) that
are required to be maintained by a member bank of such System. The
determination of the Offshore Rate by the Agent shall be conclusive in
the absence of manifest error.
"Offshore Rate Loan" means a Loan that bears interest based on
the Offshore Rate.
"Operating Lease" means, for any Person, any lease of any
property of any kind by that Person as lessee which is not a Capital
Lease.
"Operating Loss" of any Person means, as of the date of
determination, operating losses as calculated in accordance with GAAP.
"Organization Documents" means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate
of determination or instrument relating to the rights of preferred
shareholders of such corporation, any shareholder rights agreement, and
all applicable resolutions of the board of directors (or any committee
thereof) of such corporation.
"Participant" has the meaning specified in subsection 10.8(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions
under ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which the Borrower sponsors,
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described
in Section 4064(a) of ERISA) has made contributions at any time during
the immediately preceding five (5) plan years.
"Permitted Liens" has the meaning specified in Section 7.1.
12
"Permitted Swap Obligations" means all obligations (contingent or
otherwise) of the Borrower or any Subsidiary existing or arising under
Swap Contracts, provided that such obligations are (or were) entered
into in connection with a bona fide hedging operation that provides
offsetting benefits to such Person.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or
any other entity of whatever nature.
"Plan" means an employee benefit plan (as defined in Section 3(3)
of ERISA) which the Borrower sponsors or maintains or to which the
Borrower makes, is making, or is obligated to make contributions and
includes any Pension Plan.
"Pro Rata Share" means, as to any Bank at any time, the
percentage equivalent (expressed as a decimal, rounded to the ninth
decimal place) at such time of such Bank's Commitment divided by the
combined Commitments of all Banks (or, if all Commitments have been
terminated, the aggregate principal amount of such Bank's Loans divided
by the aggregate principal amount of the Loans then held by all
Banks). The initial Pro Rata Share of each Bank is set forth opposite
such Bank's name in Schedule 2.1 under the heading Pro Rata Share.
"Receivable" means any right to payment from an account
receivable obligor, arising from the sale of goods or services or the
licensing of intellectual property rights by the Borrower in the
ordinary course of its business.
"Reportable Event" means, any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than any
such event for which the 30-day notice requirement under ERISA has been
waived in regulations issued by the PBGC.
"Required Banks" means at any time Banks then holding at least
51% of the aggregate amount of the Commitments or, if no Commitments
are outstanding, Banks then having at least 51% of the then aggregate
unpaid principal amount of the Loans.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an
arbitrator or of a Governmental Authority, in each case applicable to
or binding upon the Person or any of its property or to which the
Person or any of its property is subject.
"Responsible Officer" means, with respect to the Borrower, the
chief executive officer, the president, any vice president, the
treasurer, chief operating officer or chief financial officer,
assistant treasurer, or the secretary of the Borrower, or any other
officer having substantially the same authority and responsibility; or,
with respect to compliance with financial covenants, the chief
financial officer, assistant treasurer or the treasurer of the
Borrower, or any other officer having substantially the same authority
and responsibility.
13
"Revolving Loan" has the meaning specified in Section 2.1, and
may be a Base Rate Loan or an Offshore Rate Loan (each, a "Type" of
Revolving Loan).
"Revolving Termination Date" means the earlier to occur of:
(a) January 13, 2000, unless extended pursuant to Section 2.7; and
(b) the date on which the Commitments terminate in accordance with the
provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"Senior Funded Debt" means, as of any date of determination, any
indebtedness for borrowed money then outstanding and (without
duplication) any contingent or non-contingent reimbursement obligations
in respect of any letter of credit then outstanding issued pursuant to
the $350MM Credit Agreement, but excluding any Indebtedness then
outstanding incurred by the Borrower pursuant to the Multicurrency Note
Purchase Facility.
"Subordinated Indebtedness" means Indebtedness which is expressly
subordinated to the Obligations on terms consented to in writing by the
Required Banks.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture, trust or other
business entity of which more than 50% of the voting stock, membership
interests or other equity interests (in the case of Persons other than
corporations), is owned or controlled directly or indirectly by the
Person, or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly requires,
references herein to a "Subsidiary" refer to a Subsidiary of the
Borrower.
"Surety Instruments" means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties,
shipside bonds, surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity
index swap or option, bond, note or xxxx option, interest rate option,
forward foreign exchange transaction, cap, collar or floor transaction,
currency swap, cross-currency rate swap, swaption, currency option or
any other, similar transaction (including any option to enter into any
of the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
"Tangible Net Worth" means, with respect to any Person as of any
date of determination, Total Assets of such Person as of such date
minus Total Liabilities of such Person as of such date and minus the
carrying value of (a) goodwill, organizational
14
expenses, patents,
patent applications, trademarks, trademark applications, trade names,
service marks, service xxxx applications, copyrights, designs and other
intellectual property and licenses therefor and rights therein, and
other similar intangibles, (b) all amortizing debt issuance expenses
carried as an asset, (c) all reserves carried and not deducted from
assets or not reflected as a liability, and (d) cash held in a sinking
or other analogous fund established for the purpose of redemption,
retirement or prepayment of any capital stock or any Indebtedness or
Contingent Obligation, if no offsetting liability exists with respect
to such Indebtedness or Contingent Obligation on the balance sheet of
such Person.
"Taxes" means any and all present or future taxes (including any
taxes on any additional amounts required to be paid to the Agent or the
Banks), levies, assessments, imposts, duties, deductions, fees,
withholdings or similar charges, and all liabilities with respect
thereto, excluding, in the case of each Bank and the Agent,
respectively, (a) taxes imposed on its income by the United States and
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Bank or the Agent (as the
case may be) is organized or any political subdivision thereof, and
(b) taxes imposed on its income, and franchise taxes imposed on it, by
the jurisdiction of such Bank's Lending Office, or any political
subdivision thereof.
"Total Assets" of any Person means all property, whether real,
personal, tangible, intangible or otherwise, which, in accordance with
GAAP, should be included in determining total assets as shown on the
assets portion of a balance sheet of such Person.
"Total Capital" of any Person means the sum of the Consolidated
Tangible Net Worth of such Person plus Consolidated Total Debt of such
Person.
"Total Commitment Amount" means the aggregate amount of the
Commitments of the Banks.
"Total Debt" means, with respect to any Person, all Indebtedness
of such person incurred for borrowed money plus, without duplication,
all reimbursement obligations in respect of letters of credit plus all
obligations outstanding pursuant to the Multicurrency Note Purchase
Facility.
"Total Leverage Ratio" means, with respect to any Person, the
ratio that (i) Consolidated Total Debt bears to (ii) Total Capital of
such Person.
"Total Liabilities" of any Person means all obligations,
including, without limitation, all Indebtedness (other than Guaranty
Obligations) of such Person, which, in accordance with GAAP, should be
included in determining total liabilities as shown on the liabilities
portion of a balance sheet of such Person.
"Type" has the meaning specified in the definition of "Revolving
Loan."
"UCC" means the Uniform Commercial Code as in effect in the State
of California.
15
"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code
for the applicable plan year.
"United States" and "U.S." each means the United States of
America.
"Wholly Owned Subsidiary" means any corporation in which 100% of
the capital stock of each class having ordinary voting power, and 100%
of the capital stock of every other class, in each case, at the time as
of which any determination is being made, is owned, beneficially and of
record, by the Borrower, or by one or more of the other Wholly Owned
Subsidiaries, or both; provided that, as to foreign Subsidiaries this
definition means any corporation in which at least 99% of the capital
stock of each class having ordinary voting power and at least 99% of
the capital stock of every other class, at the time as of which any
determination is made, in each case is owned beneficially and of record
by the Borrower or one or more of the other Wholly Owned Subsidiaries
or both.
1.2 Other Interpretive Provisions. (
(a) The meanings of defined terms are
equally applicable to the singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.
(c) The term "documents" includes any and all instruments, documents,
agreements, certificates, indentures, notices and
other writings, however evidenced.
(ii) The term "including" is not limiting and means "including without
limitation."
(iii) In the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to
but excluding", and the word "through" means "to and
including."
(iv) The term "property" includes any kind of property or asset, real,
personal or mixed, tangible or intangible.
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications
thereto, but only to the extent such amendments and other modifications are
not prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation.
16
(e) The captions and headings of this Agreement are for convenience of
reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters.
All such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms. Unless otherwise expressly
provided, any reference to any action of the Agent or the Banks by way of
consent, approval or waiver shall be deemed modified by the phrase "in
its/their sole discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among the Agent and the Borrower and the other parties, have
been reviewed by counsel to the Agent, the Borrower and such other parties,
and are the product of all parties. Accordingly, they shall not be construed
against the Banks or the Agent merely because of the Agent's or Banks'
involvement in their preparation.
1.3 Accounting Principles. (a) Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be
construed, and all financial computations required under this Agreement shall
be made, in accordance with GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal quarter" refer to such
fiscal periods of the Borrower.
article II
THE CREDITS
2.1 Amounts and Terms of Commitment. Each Bank severally agrees, on the
terms and conditions set forth herein, to make loans to the Borrower (each
such loan, a "Revolving Loan") from time to time on any Business Day during
the period from the Closing Date to the Revolving Termination Date, in an
aggregate amount not to exceed at any time outstanding the amount set forth
on Schedule 2.1 under the heading "Commitment" (such amount, as the same may
be reduced under Section 2.5 or reduced or increased as a result of one or
more assignments under Section 10.8); provided, however, that, after giving
effect to any Borrowing of Revolving Loans, the Effective Amount of all
outstanding Revolving Loans shall not at any time exceed the Total Commitment
Amount. Within the limits of each Bank's Commitment, and subject to the
other terms and conditions hereof, the Borrower may borrow under this
Section 2.1, prepay under Section 2.6 and reborrow under this Section 2.1.
2.2 Loan Accounts.
(a) The Loans made by each Bank shall be evidenced by one or more accounts
or records maintained by such Bank in the ordinary course of business. The
accounts or records maintained by the Agent and each Bank shall be conclusive
absent manifest error of the amount of the Loans made by the Banks to the
Borrower, and the interest and payments thereon. Any failure so to record or
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to
the Loans.
17
(b) Upon the request of any Bank made through the Agent, the Loans made by
such Bank may be evidenced by one or more Notes, instead of or in addition to
loan accounts. Each such Bank shall endorse on the schedules annexed to its
Notes the date, amount and maturity of each Loan made by it and the amount of
each payment of principal made by the Borrower with respect thereto. Each
such Bank is irrevocably authorized by the Borrower to endorse its Notes and
each Bank's record shall be conclusive absent manifest error; provided,
however, that the failure of a Bank to make, or an error in making, a
notation thereon with respect to any Loan shall not limit or otherwise affect
the obligations of the Borrower hereunder or under any such Note to such Bank.
2.3 Procedure for Borrowing. (a) Each Borrowing of Revolving Loans shall
be made upon the Borrower's irrevocable written notice delivered to the Agent
in the form of a Notice of Borrowing (which notice must be received by the
Agent prior to 9:00 a.m. San Francisco time) (i) three Business Days prior to
the requested Borrowing Date, in the case of Offshore Rate Loans; and (ii) on
the Business Day which is the requested Borrowing Date, in the case of Base
Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in an aggregate minimum
amount of $10,000,000 or any integral multiple
of $1,000,000 in excess thereof;
(B) the requested Borrowing Date, which shall be a Business Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to such Loans included
in such notice. If the Notice of Borrowing
fails to specify the duration of the Interest
Period for any Borrowing comprised of Offshore
Rate Loans, such Interest Period shall be one
month.
provided, however, that with respect to the Borrowing to be made on the
Closing Date, the Notice of Borrowing shall be delivered to the Agent not
later than 9:00 a.m. (San Francisco time) one Business Day before the Closing
Date and such Borrowing will consist of Base Rate Loans only.
(b) The Agent will promptly notify each Bank of its receipt of any Notice
of Borrowing and of the amount of such Bank's Pro Rata Share of that
Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of each Borrowing
available to the Agent for the account of the Borrower at the Agent's Payment
Office by 11:00 a.m. (San Francisco time) on the Borrowing Date requested by
the Borrower in funds immediately available to the Agent. The proceeds of
all such Loans will then be made available to the Borrower by the Agent by
(i) wire transfer of immediately available funds to the Borrower at, Xxxxxx
Trust, ABA No. 071 000 288, Account No. 0000000, for credit to Storage
Technology Corporation or such other account as the Borrower shall specify to
the Agent or (ii) at the option
18
of the Borrower, by crediting the account of
the Borrower on the books of BofA with the aggregate of the amounts made
available to the Agent by the Banks and, in each case, in like funds as
received by the Agent.
(d) After giving effect to any Borrowing, unless the Agent shall otherwise
consent, there may not be more than ten different Interest Periods in effect.
(e) Any Notice of Borrowing received after the time noted in
subsection 2.3(a) but prior to 5:00 p.m. (San Francisco time) on any Business
Day, shall be deemed to have been received prior to 9:00 a.m. (San Francisco
time) on the next Business Day.
2.4 Conversion and Continuation Elections. (a) The Borrower may with
respect to its Loans, upon irrevocable written notice to the Agent in
accordance with subsection 2.4(b):
(i) elect, as of any Business Day, in the case of Base Rate Loans, or as of
the last day of the applicable Interest Period, in
the case of any other Type of Revolving Loans, to
convert any such Revolving Loans (or any part thereof
in an amount not less than $10,000,000, or that is in
an integral multiple of $1,000,000 in excess thereof)
into Revolving Loans of any other Type; or
(ii) elect as of the last day of the applicable Interest Period, to continue
any Revolving Loans having Interest Periods expiring
on such day (or any part thereof in an amount not
less than $10,000,000, or that is in an integral
multiple of $1,000,000 in excess thereof);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $10,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the
right of the Borrower to continue such Revolving Loans as, and convert such
Loans into, Offshore Rate Loans shall terminate.
(b) The Borrower shall deliver a Notice of Conversion/Continuation to be
received by the Agent not later than 9:00 a.m. (San Francisco time) with
respect to its Revolving Loans at least (i) three Business Days in advance of
the Conversion/Continuation Date, if the Revolving Loans of the Borrower are
to be converted into or continued as Offshore Rate Loans; and (ii) on the
Conversion/Continuation Date, if the Revolving Loans of the Borrower are to
be converted into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Revolving Loans to be converted or continued;
(C) the Type of Revolving Loans resulting from the proposed conversion or
continuation; and
19
(D) other than in the case of conversions into Base Rate Loans, the
duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to Offshore
Rate Loans of the Borrower, the Borrower has failed to select timely a new
Interest Period to be applicable to such Offshore Rate Loans or if any
Default or Event of Default then exists, the Borrower shall be deemed to have
elected to convert such Offshore Rate Loans into Base Rate Loans effective as
of the expiration date of such Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of a Notice of
Conversion/Continuation, or, if no timely notice is provided by the Borrower,
the Agent will promptly notify each Bank of the details of any automatic
conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Revolving
Loans with respect to which the notice was given held by each Bank.
(e) Unless the Required Banks otherwise consent, during the existence of a
Default or Event of Default, the Borrower may not elect to have Loans
converted into or continued as an Offshore Rate Loans.
(f) After giving effect to any conversion or continuation of Revolving
Loans, unless the Agent shall otherwise consent, there may not be more than
ten different Interest Periods for all Loans in effect.
2.5 Voluntary Termination or Reduction of Commitments. Termination or
Reduction of Commitments. The Borrower may, upon not less than five Business
Days' prior notice to the Agent, terminate the Commitments, or permanently
reduce the Commitments by an aggregate minimum amount of $10,000,000 or any
integral multiple of $1,000,000 in excess thereof; unless, after giving
effect thereto and to any prepayments of any Loans made on the effective date
thereof, the Effective Amount of all Revolving Loans would exceed the amount
of the combined Commitments then in effect. Once reduced in accordance with
this Section, the Commitments may not be increased or reinstated. Any
reduction of the Commitments shall be applied to each Bank's Commitment
according to its Pro Rata Share. All accrued commitment fees to, but not
including, the effective date of any termination of Commitments shall be paid
on the effective date of such termination.
2.6 Optional Prepayments. Subject to Section 3.4, the Borrower may, at any
time or from time to time, upon delivery of an irrevocable Notice of
Prepayment to the Agent prior to 9:00 a.m. (San Francisco time) (a) not less
than three Business Days prior to the date of prepayment in the case of
Offshore Rate Loans, and (b) the same day as the date of prepayment in the
case of Base Rate Loans, ratably prepay Revolving Loans in whole or in part,
in minimum amounts of $10,000,000 or any integral multiple of $1,000,000 in
excess thereof.
Any notice of prepayment received after 9:00 a.m. (San Francisco time)
on a Business Day but prior to 5:00 p.m. (San Francisco time) on such
Business Day shall be deemed to have been given prior to 9:00 a.m. (San
Francisco time) on the next Business Day. Any such notice
20
of prepayment
shall specify the date and amount of such prepayment and the Type(s) of Loans
to be prepaid.
The Agent will promptly notify each Bank of its receipt of any such
notice, and of such Bank's Pro Rata Share of such prepayment. If any such
notice is given the Borrower shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to each such date on the
amount prepaid and any amounts required pursuant to Section 3.4.
2.7 Repayment. The Borrower agrees to repay to the Banks on the Revolving
Termination Date the aggregate principal amount of its Loans (together with
accrued interest and fees thereon) outstanding on such date. Provided,
however, that the Borrower may give written notice to the Banks (through the
Agent) at least 30 days, but not more than 60 days, prior to the Revolving
Termination Date then in effect requesting that the Agent and the Banks
extend the Revolving Termination Date for an additional 364-day period. The
Banks and the Agent may grant or reject such request in their sole
discretion, and the Borrower acknowledges that there is no commitment or
understanding that the Revolving Termination Date will be extended. If such
request is granted by the Agent and all of the Banks, the Revolving
Termination Date then in effect shall be so extended, subject to such changed
terms and payment of such fee (if any) as shall have been agreed upon by the
Borrower, the Banks and the Agent. The Agent, on behalf of the Banks, shall
notify the Borrower, not later than 30 days after the Agent's receipt of the
Borrower's written request that the Agent and the Banks extend the Revolving
Termination Date, whether or not such request shall be granted.
2.8 Interest.
(a) Each Revolving Loan shall bear interest on the outstanding principal
amount thereof from the applicable Borrowing Date at a rate per annum equal
to the Offshore Rate or the Base Rate as the case may be subject to the
Borrower's right to convert to other Types of Revolving Loans under
Section 2.4), plus the Applicable Margin.
(b) Interest on each Revolving Loan of the Borrower shall be paid by the
Borrower in arrears on each Interest Payment Date. Interest shall also be
paid on the date of any prepayment of Loans (other than Base Rate Loans)
under Section 2.6 for the portion of the Loans so prepaid and upon payment
(including prepayment) in full thereof and, during the existence of any Event
of Default, interest shall be paid on demand of the Agent at the request or
with the consent of the Required Banks.
(c) Notwithstanding subsection (a) of this Section, while any Event of
Default exists or after acceleration, the Borrower shall pay interest (after
as well as before entry of judgment thereon to the extent permitted by law)
on the principal amount of all outstanding Obligations, at a rate per annum
which is determined by adding 2% per annum to the Applicable Margin then in
effect for such Loans (other than Base Rate Loans) and, in the case of
Obligations not subject to an Applicable Margin, at a fluctuating rate per
annum equal to the Base Rate plus 2%; provided, however, that, on and after
the expiration of any Interest Period applicable to any Offshore Rate Loan
outstanding on the date of occurrence of such Event of Default or
21
acceleration, the principal amount of such Loan shall, during the
continuation of such Event of Default or after acceleration, bear interest at
a fluctuating rate per annum equal to the Base Rate plus 2%.
(d) Anything herein to the contrary notwithstanding, the obligations of the
Borrower to any Bank hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest
is computed hereunder, to the extent (but only to the extent) that
contracting for or receiving such payment by such Bank would be contrary to
the provisions of any law applicable to such Bank limiting the highest rate
of interest that may be lawfully contracted for, charged or received by such
Bank, and in such event the Borrower shall pay such Bank interest at the
highest rate permitted by applicable law.
(e) Subject to the effect of subsection 2.8(a), the Applicable Margin will
be determined by the Agent from time to time in accordance with the pricing
grid set forth in Schedule 2.8(e) based on the most recent Compliance
Certificate delivered by the Borrower pursuant hereto. Such determination
shall be based on the calculations as set forth in such Compliance
Certificate and shall apply from the first Business Day after the Agent
receives such Compliance Certificate until and through the Business Day when
the Agent receives the applicable Compliance Certificate for the next fiscal
quarter.
The initial Applicable Margin, applicable from the Closing Date to the
date of delivery of the Compliance Certificate hereunder for the fiscal
quarter ending December 1998, shall be as set forth in the Note to Schedule
2.8(e).
2.9 Fees. (a) Commitment Fees. The Borrower agrees to pay to the Agent
for the ratable account of each Bank a commitment fee on the actual daily
unused portion of such Bank's Commitment, computed on a quarterly basis in
arrears on the last Business Day of each calendar quarter based upon the
daily utilization for that quarter as calculated by the Agent, equal to the
amount set forth in the next paragraph.
Such commitment fee shall accrue from the Closing Date to the Revolving
Termination Date and shall be due and payable quarterly in arrears on (A) the
last Business Day of the period ending on Xxxxx 00, 0000, (X) on the last
Business Day of each calendar quarter commencing after March 31, 1999 and
(C) on the Revolving Termination Date; provided that, in connection with any
reduction or termination of Commitments under Section 2.5, the accrued
commitment fee calculated for the period ending on such date shall also be
paid on the date of such reduction or termination. The commitment fees
provided in this subsection shall accrue at all times after the
above-mentioned commencement date, including at any time during which one or
more conditions in Article IV are not met.
For the period from the Closing Date through the Business Day when the
Agent receives the Borrower's Compliance Certificate for the fiscal quarter
ending December 25, 1998, the Applicable Fee Amount will be 0.275%.
Thereafter the Applicable Fee Amount shall be determined by the Agent from
time to time in accordance with the pricing grid set forth in Schedule 2.8(e)
based on the most recent Compliance Certificate of the Borrower delivered by
the Borrower pursuant hereto. Such determinations shall apply from the first
Business Day after
22
the Agent receives such Compliance Certificate until and
through the Business Day when the Agent receives the applicable Compliance
Certificate for the next fiscal quarter as provided herein.
(b) Arrangement Fee. The Borrower will pay the Agent and Arranger
such other fees as are set forth in that certain fee letter dated
December 15, 1998.
2.10 Computation of Fees and Interest. (a) All computations of interest
for Base Rate Loans when the Base Rate is determined by BofA's "reference
rate" shall be made on the basis of a year of 365 or 366 days, as the case
may be, and actual days elapsed. All other computations of fees and interest
shall be made on the basis of a 360-day year and actual days elapsed (which
results in more interest being paid than if computed on the basis of a
365-day year). Interest and fees shall accrue during each period during
which interest or such fees are computed from the first day thereof to the
last day thereof.
(b) Each determination of an interest rate by the Agent shall be conclusive
and binding on the Borrower and the Banks in the absence of manifest error.
2.11 Payments by the Borrower. (a) All payments to be made by the Borrower
shall be made without set-off, recoupment or counterclaim. Except as
otherwise expressly provided herein, all payments by the Borrower shall be
made to the Agent for the account of the Banks at the Agent's Payment Office,
and shall be made in Dollars and in immediately available funds, no later
than 10:30 a.m. (San Francisco time) on the date specified herein. The Agent
will promptly distribute to each Bank its Pro Rata Share (or other applicable
share as expressly provided herein) of such payment in like funds as
received. Any payment received by the Agent later than 10:30 a.m. (San
Francisco time) shall be deemed to have been received on the following
Business Day and any applicable interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of "Interest
Period" herein, whenever any payment is due on a day other than a Business
Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of
interest or fees, as the case may be.
(c) Unless the Agent receives notice from the Borrower prior to the date on
which any payment is due to the Banks that the Borrower will not make such
payment in full as and when required, the Agent may assume that the Borrower
has made such payment in full to the Agent on such date in immediately
available funds and the Agent may (but shall not be so required), in reliance
upon such assumption, distribute to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the extent the Borrower
has not made such payment in full to the Agent, each Bank shall repay to the
Agent on demand such amount distributed to such Bank, together with interest
thereon at the Federal Funds Rate for each day from the date such amount is
distributed to such Bank until the date repaid.
2.12 Payments by the Banks to the Agent. (a) Unless the Agent receives
notice from a Bank on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at least one Business Day prior to the date
of such Borrowing, that such Bank will
23
not make available as and when
required hereunder to the Agent for the account of the Borrower the amount of
that Bank's Pro Rata Share of the Borrowing, the Agent may assume that each
Bank has made such amount available to the Agent in immediately available
funds on the Borrowing Date and the Agent may (but shall not be so required),
in reliance upon such assumption, make available to the Borrower on such date
a corresponding amount. If and to the extent any Bank shall not have made
its full amount available to the Agent in immediately available funds and the
Agent in such circumstances has made available to the Borrower such amount,
that Bank shall on the Business Day following such Borrowing Date make such
amount available to the Agent, together with interest at the Federal Funds
Rate for each day during such period. A notice of the Agent submitted to any
Bank with respect to amounts owing under this subsection (a) shall be
conclusive, absent manifest error. If such amount is so made available, such
payment to the Agent shall constitute such Bank's Loan on the date of
Borrowing for all purposes of this Agreement. If such amount is not made
available to the Agent on the Business Day following the Borrowing Date, the
Agent will notify the Borrower of such failure to fund and, upon demand by
the Agent, the Borrower shall pay such amount to the Agent for the Agent's
account, together with interest thereon for each day elapsed since the date
of such Borrowing, at a rate per annum equal to the interest rate applicable
at the time to the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date shall
not relieve any other Bank of any obligation hereunder to make a Loan on such
Borrowing Date, but no Bank shall be responsible for the failure of any other
Bank to make the Loan to be made by such other Bank on any Borrowing Date.
2.13 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it
any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its ratable share (or other
share contemplated hereunder), such Bank shall immediately (a) notify the
Agent of such fact, and (b) purchase from the other Banks such participations
in the Loans made by them as shall be necessary to cause such purchasing Bank
to share the excess payment pro rata with each of them; provided, however,
that if all or any portion of such excess payment is thereafter recovered
from the purchasing Bank, such purchase shall to that extent be rescinded and
each other Bank shall repay to the purchasing Bank the purchase price paid
therefor, together with an amount equal to such paying Bank's ratable share
(according to the proportion of (i) the amount of such paying Bank's required
repayment to (ii) the total amount so recovered from the purchasing Bank) of
any interest or other amount paid or payable by the purchasing Bank in
respect of the total amount so recovered. The Borrower agrees that any Bank
so purchasing a participation from another Bank may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 10.10) with respect to such participation as
fully as if such Bank were the direct creditor of each the Borrower in the
amount of such participation. The Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Banks following
any such purchases or repayments.
24
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 Taxes. (a) Any and all payments by the Borrower to each Bank or the
Agent under this Agreement and any other Loan Document shall be made free and
clear of, and without deduction or withholding for, any Taxes. In addition,
the Borrower shall pay all Taxes.
(b) If the Borrower shall be required by law to deduct or withhold any
Taxes from or in respect of any sum payable hereunder to any Bank or the
Agent, then:
(i) the sum payable shall be increased as necessary so that, after making
all required deductions and withholdings (including
deductions and withholdings applicable to additional
sums payable under this Section), such Bank or the
Agent, as the case may be, receives and retains an
amount equal to the sum it would have received and
retained had no such deductions or withholdings been
made;
(ii) the Borrower shall make such deductions and withholdings; and
(iii) the Borrower shall pay the full amount deducted or withheld to the
relevant taxing authority or other authority in
accordance with applicable law.
(c) The Borrower agrees to indemnify and hold harmless each Bank for the
full amount of Taxes in the amount (without duplication of other amounts paid
pursuant to this Section 3.1) that the respective Bank specifies as necessary
to preserve the after-tax yield (which after tax yield is intended to
compensate each Bank for Taxes deducted or withheld pursuant to this
Section 3.1 and additional Taxes imposed on amounts payable pursuant to this
Section 3.1) the Bank would have received if such Taxes had not been imposed,
and any liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto, whether or not such Taxes were correctly
or legally asserted. Payment under this indemnification shall be made within
30 days after the date the Bank or the Agent makes written demand therefor,
which demand shall specify in reasonable detail the basis for such demand.
(d) Within 30 days after the date of any payment by the Borrower of Taxes,
the Borrower shall furnish to such Bank or the Agent the original or a
certified copy of a receipt evidencing payment thereof, or other evidence of
payment satisfactory to such Bank or the Agent.
(e) Without affecting its rights under this Section 3.1 or any provision of
this Agreement, the Agent and each Bank agree that if any Taxes are imposed
and required by law to be paid or to be withheld from any amount payable to
such Bank or its Lending Office with respect to which the Borrower would be
obligated pursuant to this Section 3.1 to increase any amounts payable to
such Bank or to pay any such Taxes, such Bank shall use reasonable efforts to
select an alternative Lending Office, which would not result in the
imposition of such Taxes;
25
provided, however, that neither of the Agent nor
the Banks shall be obligated to select any such alternative office if such
Bank determines that (i) as a result of such selection it would be in
violation of an applicable law, regulation, or treaty, or would incur
additional costs or expenses or (ii) such selection would be inadvisable for
regulatory reasons or inconsistent with the interests of such Bank.
(f) So long as no Default or Event of Default shall have occurred and be
continuing, the Borrower may, within the 30 day period commencing on the day
that the Borrower receives a demand for the payment of Taxes from any Bank
pursuant to this Section 3.1, demand that the Bank making such demand be
replaced with a Person that is an Eligible Assignee selected by the Borrower
and subject to consent by the Agent. Upon any such demand by the Borrower,
if the Agent shall have consented to the Eligible Assignee selected by the
Borrower (provided that should such Eligible Assignee be a Bank, such Bank
shall also have consented to such selection), the Bank that made a demand
pursuant to this Section 3.1 shall execute and deliver an Assignment and
Acceptance to the Agent pursuant to which such Bank shall assign all of its
rights and obligations under this Agreement and the other Loan Documents to
the Eligible Assignee selected by the Borrower.
3.2 Illegality. (a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or any central bank or other Governmental Authority has asserted
that it is unlawful, for any Bank or its applicable Lending Office to make
Offshore Rate Loans, then, on notice thereof by such Bank to the Borrower
through the Agent, any obligation of that Bank to make Offshore Rate Loans
shall be suspended until the Bank notifies the Agent and the Borrower that
the circumstances giving rise to such determination no longer exist. Any
Bank notifying the Borrower of such a suspension of its obligation to make
Offshore Rate Loans shall provide to the Borrower reasonable documentation
supporting such obligation.
(b) If a Bank determines that it is unlawful to maintain any Offshore Rate
Loan, the Borrower shall, upon its receipt of notice of such fact and demand
from such Bank (with a copy to the Agent), prepay in full such Offshore Rate
Loans of that Bank then outstanding, together with interest accrued thereon
and amounts required under Section 3.4, either on the last day of the
Interest Period thereof, if such Bank may lawfully continue to maintain such
Offshore Rate Loans to such day, or immediately, if such Bank may not
lawfully continue to maintain such Offshore Rate Loan. If the Borrower is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Borrower shall borrow from the affected Bank, in the amount
of such repayment, a Base Rate Loan. Any Bank making such a demand for
prepayment of Offshore Rate Loans shall provide to the Borrower reasonable
documentation supporting such demand.
3.3 Increased Costs and Reduction of Return. (a) If any Bank determines
that, due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation by any Governmental Authority having
jurisdiction over the Banks or (ii) the compliance by any Bank with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in
26
the cost to such Bank of agreeing to make or making, funding or maintaining any
Offshore Rate Loans, then the Borrower shall be liable for, and shall from
time to time, upon demand (with a copy of such demand to be sent to the
Agent), promptly (and in any event within 30 days) pay to the Agent for the
account of such Bank, additional amounts as are sufficient to compensate such
Bank for such increased costs. Any Bank making such a demand for payment
shall provide to the Borrower reasonable documentation supporting such demand.
(b) If any Bank shall have determined that (i) the introduction of any
Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or
(iv) compliance by the Bank (or its Lending Office) or any corporation
controlling the Bank with any Capital Adequacy Regulation, affects or would
affect the amount of capital required or expected to be maintained by such
Bank or any corporation controlling such Bank and (taking into consideration
such Bank's or such corporation's policies with respect to capital adequacy)
determines that the amount of such capital is increased as a consequence of
its Commitments, loans, credits or obligations under this Agreement, then,
upon demand of such Bank to the Borrower through the Agent, the Borrower
shall promptly (and in any event within 30 days) pay to such Bank, from time
to time as specified by such Bank, additional amounts sufficient to
compensate such Bank for such increase. Any Bank making such a demand for
payment shall provide to the Borrower reasonable documentation supporting
such demand.
3.4 Funding Losses. The Borrower shall reimburse each Bank and hold each
Bank harmless from any loss or expense which the Bank sustains or incurs as a
consequence of:
(a) the failure of the Borrower to make on a timely basis any payment of
principal of any Offshore Rate Loan;
(b) the failure of the Borrower to borrow, continue or convert a Loan after
the Borrower has given (or is deemed to have given) a Notice of Borrowing or
a Notice of Conversion/Continuation;
(c) the failure of the Borrower to make any prepayment in accordance with
any notice delivered under Section 2.6;
(d) the prepayment or other payment (including after acceleration thereof)
of an Offshore Rate Loan on a day that is not the last day of the relevant
Interest Period; or
(e) the conversion under Section 2.4 of any Offshore Rate Loan to a Base
Rate Loan on a day that is not the last day of the relevant Interest Period;
including any such loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain its Offshore Rate Loans or
from fees payable to terminate the deposits from which such funds were
obtained.
3.5 Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the
Offshore Rate for any requested Interest Period with respect to a proposed
borrowing of Offshore Rate Loans or conversion into
27
or continuation of
Offshore Rate Loans, or that the Offshore Rate applicable pursuant to
Section 2.8 for any requested Interest Period with respect to a proposed
borrowing of Offshore Rate Loans or conversion into or continuation of
Offshore Rate Loans does not adequately and fairly reflect the cost to the
Agent or any Bank of funding such Loans, the Agent will promptly so notify
the Borrower and each Bank and will provide such Persons with reasonable
documentation supporting such determination. Thereafter, the obligation of
the Banks to make or maintain Offshore Rate Loans hereunder shall be
suspended until the Agent shall notify the Borrower and the Banks that the
circumstances causing such suspension no longer exist. Upon receipt of such
notice, the Borrower may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Borrower does not
revoke such Notice, the Banks shall make, convert or continue the Loans, as
proposed by the Borrower, in the amount specified in the applicable notice
submitted by the Borrower, but such Loans shall be made, converted or
continued as Base Rate Loans instead of Offshore Rate Loans.
3.6 Survival. The agreements and obligations of the Borrower in this
Article III shall survive the payment of all other Obligations.
3.7 Notice of Claims. The Agent or the appropriate Bank will notify the
Borrower in writing of its claims under Article III within 180 days after any
officer of the Agent or such Bank having principal responsibility for
monitoring the Borrower's performance of its obligations under the Loan
Documents has actual knowledge of facts giving rise to a claim under
Article III.
article IV
CONDITIONS PRECEDENT
4.1 Conditions to Agreement. The effectiveness of this Agreement is
subject to the condition that the Agent shall have received on or before the
Closing Date all of the following, in form and substance satisfactory to the
Agent and each Bank, and in sufficient copies for each Bank (other than the
Notes to be delivered pursuant to Section 4.1(a)):
(a) Credit Agreement and Notes. This Agreement and Notes executed by the
Borrower for Banks requesting Notes.
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors of the Borrower
authorizing the transactions contemplated hereby,
certified as of the Closing Date by the Secretary or
an Assistant Secretary of the Borrower; and
(ii) A certificate of the Secretary or Assistant Secretary of the Borrower
certifying the names and true signatures of the
officers of the Borrower authorized to execute,
deliver and perform, as applicable, this Agreement,
and all other Loan Documents to be delivered by it
hereunder;
28
(c) Organization Documents; Good Standing. Each of the following documents:
(i) the articles or certificate of incorporation and the bylaws of the
Borrower as in effect on the Closing Date, certified
by the Secretary or Assistant Secretary of the
Borrower as of the Closing Date; and
(ii) a good standing and tax good standing certificate for the Borrower from
the Secretary of State (or similar, applicable
Governmental Authority) of its state of incorporation
and from the State of Colorado;
(d) Legal Opinions. Opinions of Shearman & Sterling and internal counsel
to the Borrower addressed to the Agent and the Banks, substantially in the
forms of Exhibit D-1 and Exhibit D-2, respectively.
(e) Payment of Fees. Evidence of payment by the Borrower of all accrued
and unpaid fees, costs and expenses to the extent then due and payable on the
Closing Date, including any such costs, fees and expenses arising under or
referenced in Sections 2.9 and 10.4, provided that the Borrower shall have
been given reasonably detailed bills for the fees and services of the Agent's
legal counsel at least one Business Day prior to the Closing Date if it is to
pay such fees and expenses on the Closing Date;
(f) Certificate. A certificate signed by a Responsible Officer of the
Borrower, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article V are true and
correct on and as of such date, as though made on and
as of such date; and
(ii) no Default or Event of Default exists or would result from the initial
Borrowing.
(g) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may reasonably request.
4.2 Conditions to All Credit Extensions. The obligation of each Bank to
make any Revolving Loan to be made by it (including its initial Revolving
Loan) or to continue or convert any Revolving Loan under Section 2.4 is
subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date or Conversion/Continuation Date:
(a) Notice. The Agent shall have received (with, in the case of the
initial Revolving Loan only, a copy for each Bank) a Notice of Borrowing or a
Notice of Conversion/Continuation, as applicable;
(b) Continuation of Representations and Warranties. The representations
and warranties in Article V shall be true and correct on and as of such
Borrowing Date or
29
Conversion/Continuation Date with the same effect as if
made on and as of such Borrowing Date or Conversion/Continuation Date; and
(c) No Existing Default. No Default or Event of Default shall exist or
shall result from such Borrowing or continuation or conversion or Issuance.
(d) Representation and Warranty. Each Notice of Borrowing and Notice of
Conversion/Continuation submitted by the Borrower hereunder shall constitute
a representation and warranty by the Borrower hereunder, as of the date of
each such notice and as of each Borrowing Date, Conversion/Continuation Date,
as applicable, that the conditions in this Section 4.2 are satisfied.
article V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agent and each Bank that:
5.1 Corporate Existence and Power. The Borrower and each of its Material
Subsidiaries:
(a) is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and, in the case of the Borrower, perform
its obligations under the Loan Documents;
(c) is duly qualified, licensed and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification or license or good
standing; and
(d) is in compliance with all Requirements of Law; except, in each case
referred to in clause (c) or clause (d), to the extent that the failure to do
so could not reasonably be expected to have a Material Adverse Effect.
5.2 Corporate Authorization; No Contravention. The execution, delivery and
performance by the Borrower of this Agreement and each other Loan Document to
which the Borrower is party, have been duly authorized by all necessary
corporate action, and do not:
(a) contravene the terms of any of such the Borrower's Organization
Documents;
(b) conflict with or result in any breach or contravention of any document
evidencing any Contractual Obligation to which the Borrower is a party or any
order, injunction, writ or decree of any Governmental Authority to which the
Borrower or its property is subject, except where such conflict, breach or
contravention would not cause a Material Adverse Effect or render any Loan
Document unenforceable against the Borrower or any other Person;
30
(c) violate any Requirement of Law except, in each case, where any such
contravention, conflict, breach, or violation would not cause a Material
Adverse Effect or render any Loan Document unenforceable against the Borrower
or any other Person; or
(d) result in the creation of any Lien.
5.3 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or current enforcement against, the
Borrower or any of its Material Subsidiaries of the Agreement or any other
Loan Document.
5.4 Binding Effect. This Agreement and each other Loan Document to which
the Borrower is a party constitute (or, when duly executed and delivered,
shall constitute) the legal, valid and binding obligations of the Borrower,
enforceable against it in accordance with their respective terms and claims
under this Agreement and each Loan Document will rank at least pari passu
with the claims of other unsecured creditors, except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles
relating to enforceability.
5.5 Litigation. Except as specifically disclosed in Schedule 5.5, there
are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of the Borrower, threatened or contemplated, at law, in
equity, in arbitration or before any Governmental Authority, against the
Borrower, or its Subsidiaries or any of their respective properties which:
(a) relates to this Agreement or any other Loan Document, or any of the
transactions contemplated hereby or thereby; or
(b) if determined adversely to the Borrower or its Subsidiaries, would
reasonably be expected to have a Material Adverse Effect. No injunction,
writ, temporary restraining order or any order of any nature has been issued
by any court or other Governmental Authority purporting to enjoin or restrain
the execution, delivery or performance of this Agreement or any other Loan
Document, or directing that the transactions provided for herein or therein
not be consummated as herein or therein provided.
5.6 No Default. No Default or Event of Default exists or would result from
the incurring of any Obligations by the Borrower. Neither the Borrower nor
any Subsidiary is in default under or with respect to any Contractual
Obligation in any respect which, individually or together with all such
defaults, could reasonably be expected to have a Material Adverse Effect, or
that would, if such default had occurred after the Closing Date, create an
Event of Default under subsection 8.1(e).
5.7 ERISA Compliance.
(a) Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other federal or state law. Each Plan
which is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the
31
IRS and to the best knowledge of the
Borrower, nothing has occurred which would cause the loss of such
qualification. The Borrower and each ERISA Affiliate has made all required
contributions to any Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect, except as specifically
disclosed in Schedule 5.5. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan
which has resulted or could reasonably be expected to result in a Material
Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the
Borrower nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA);
(iv) neither the Borrower nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability (and no event has occurred which, with the
giving of notice under Section 4219 of ERISA, would result in such liability)
under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and
(v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA.
5.8 Use of Proceeds; Margin Regulations. The proceeds of the Loans are to
be used solely for the purposes set forth in and permitted by Section 6.11
and Section 7.6. Neither the Borrower nor any Subsidiary is generally
engaged in the business of purchasing or selling Margin Stock or extending
credit for the purpose of purchasing or carrying Margin Stock. To the extent
that the Borrower uses Loan proceeds to acquire shares of its own stock which
is Margin Stock, the Borrower intends to cause such acquired shares to be
immediately retired.
5.9 Title to Properties; Liens. The Borrower and each Subsidiary have good
record and marketable title in fee simple to, or valid leasehold interests
in, all real property necessary or used in the ordinary conduct of their
respective businesses, except for such defects in title as would not,
individually or in the aggregate, have a Material Adverse Effect. As of the
Closing Date the property (real or personal, tangible or intangible) of the
Borrower and its Material Subsidiaries is subject to no Liens, other than
Permitted Liens.
5.10 Taxes. The Borrower and its Subsidiaries have filed or caused to be
filed all federal and other material tax returns and reports required to be
filed, and have paid or caused to be paid all federal and other material
taxes, assessments, fees and other governmental charges levied or imposed
upon them or their properties, income or assets otherwise due and payable,
except (i) those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP and (ii) those for which the failure to pay would not have a
Material Adverse Effect. To the Borrower's knowledge, there is no proposed
tax assessment against the Borrower or any Subsidiary that would, if made,
have a Material Adverse Effect.
32
5.11 Financial Condition. (a) The unaudited Consolidated financial
statements of the Borrower and its Subsidiaries dated for the fiscal quarter
ending September 25, 1998 (as set forth in the Borrower's latest Form 10-Q
filing dated November 6, 1998) and the related Consolidated statements of
income or operations, shareholders' equity and cash flows for the fiscal year
ended on that date:
(i) were prepared in accordance with GAAP consistently applied throughout
the period covered thereby, except as otherwise
expressly noted therein;
(ii) fairly present the financial condition of the Borrower and its
Subsidiaries as of the date thereof and results of
operations for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 5.11, show all material
indebtedness and other liabilities, direct or
contingent, of the Borrower and its Consolidated
Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and
Contingent Obligations.
(b) Since the end of the fiscal quarter ending September 25, 1998 there has
been no Material Adverse Effect.
5.12 Environmental Matters. The Borrower conducts in the ordinary course of
business a review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties, and as a
result thereof the Borrower has reasonably concluded that, except as
specifically disclosed in Schedule 5.12, such Environmental Laws and
Environmental Claims could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
5.13 Regulated Entities. Neither the Borrower, nor any Person controlling
the Borrower, nor any Subsidiary, is an "Investment Company" within the
meaning of the Investment Company Act of 1940. The Borrower is not subject
to regulation under the Public Utility Holding Company Act of 1935, the
federal Power Act, the Interstate Commerce Act, any state public utilities
code, or any other federal or state statute or regulation limiting its
ability to incur Indebtedness.
5.14 Copyrights, Patents, Trademarks and Licenses, Etc. The Borrower or its
Subsidiaries own or are licensed or otherwise have the right to use all of
the patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective material businesses, without conflict with
the rights of any other Person. To the best knowledge of the Borrower, no
slogan or other advertising device, product, process, method, substance, part
or other material now employed, or now contemplated to be employed, by the
Borrower or any Material Subsidiary infringes upon any rights held by any
other Person. Except as specifically disclosed in Schedule 5.5, no claim or
litigation regarding any of the foregoing is pending or, to the best
33
knowledge of the Borrower, threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or
code is pending or, to the knowledge of the Borrower, proposed, which, in
either case, could reasonably be expected to have a Material Adverse Effect.
5.15 Subsidiaries. The Borrower (a) has no Subsidiaries other than those
specifically disclosed in part (a) of Schedule 5.15 hereto as of the Closing
Date and (b) has no equity investments in any other corporation or entity
other than those specifically disclosed in part (b) of Schedule 5.15 except,
in each case, for Subsidiaries created and equity investments made after the
Closing Date and otherwise permitted by this Agreement.
5.16 Insurance. Except as specifically disclosed in Schedule 5.16, the
properties of the Borrower and its Material Subsidiaries are insured with, to
the best knowledge of the Borrower, financially sound and reputable insurance
companies not Affiliates of the Borrower, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities
where the Borrower or such Material Subsidiary operates.
5.17 Full Disclosure. None of the representations or warranties made by the
Borrower or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any written exhibit, report, statement or certificate
furnished by or on behalf of the Borrower or any Subsidiary in connection
with the Loan Documents (including the offering and disclosure materials
delivered by or on behalf of the Borrower to the Banks prior to the Closing
Date), contains any untrue statement of a material fact or omits any material
fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they are made, not
misleading as of the time when made or delivered; provided that nothing in
this Section 5.17 shall apply to any projections, forward-looking information
or other similar or related information furnished by or on behalf of the
Borrower or any Subsidiary in connection with the Loan Documents.
5.18 Projections. All projections, forward-looking information or other
similar or related information furnished by or on behalf of the Borrower or
any Subsidiary in connection with the Loan Documents were prepared in good
faith on the basis of the assumptions stated therein, which assumptions were
fair in the light of conditions existing at the time of delivery of such
forecasts, and represented, at the time of delivery, the Borrower or such
Subsidiary's best estimate of its future financial performance, operations
and results.
34
Article VI
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required
Banks waive compliance in writing:
6.1 Financial Statements. The Borrower shall deliver to the Agent, in form
and detail satisfactory to the Agent and the Required Banks, with sufficient
copies for each Bank:
(a) as soon as available, but not later than 120 days after the end of each
fiscal year, a copy of the audited Consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such year and the related Consolidated
statements of income or operations, shareholders' equity and cash flows for
such year, setting forth in each case in comparative form the figures for the
previous fiscal year, and accompanied by the opinion of
PricewaterhouseCoopers LLP or another nationally-recognized independent
public accounting firm ("Independent Auditor") which report shall state that
such Consolidated financial statements present fairly the financial position
for the periods indicated in conformity with GAAP applied on a basis
consistent with prior years. Such opinion shall not be qualified or limited
because of a restricted or limited examination by the Independent Auditor of
any material portion of the Borrower's or any Subsidiary's records;
(b) as soon as available, but not later than 55 days after the end of each
of the first three fiscal quarters of each fiscal year, a copy of the
unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as
of the end of such quarter and the related Consolidated statements of income,
shareholders' equity and cash flows for the period commencing on the first
day and ending on the last day of such quarter, and certified by a
Responsible Officer as fairly presenting, in accordance with GAAP (subject to
ordinary, good faith year-end audit adjustments), the financial position and
the results of operations of the Borrower and the Subsidiaries.
6.2 Certificates; Other Information. The Borrower shall furnish to the
Agent with sufficient copies for each Bank:
(a) concurrently with the delivery of the financial statements referred to
in subsections 6.1(a) and (b), a Compliance Certificate executed by a
Responsible Officer;
(b) promptly, copies of all financial statements and reports that the
Borrower sends to its shareholders, and copies of all financial statements
and regular, periodical or special reports (including Forms 10-K, 10-Q and
8-K) that the Borrower or any Subsidiary may make to, or file with, the SEC;
and
35
(c) promptly, such additional information regarding the business, financial
or corporate affairs of the Borrower or any Subsidiary as the Agent, at the
request of any Bank, may from time to time reasonably request.
6.3 Notices. The Borrower shall promptly notify the Agent and each Bank:
(a) after a Responsible Officer of the Borrower knows or has reason to know
of the occurrence of any Default or Event of Default, and of the occurrence
or existence of any event or circumstance for which it is reasonably
foreseeable that such event or circumstance will become a Default or Event of
Default;
(b) after a Responsible Officer of the Borrower or any ERISA Affiliate
knows or has reason to know that any material ERISA Event has occurred, with
a statement of a Responsible Officer of the Borrower describing such ERISA
Event and the action, if any, that the Borrower or such ERISA Affiliate
proposes to take with respect thereto; and
(c) of any material change in accounting policies or financial reporting
practices by the Borrower or any of its Consolidated Subsidiaries, except for
changes in financial reporting practices mandated by any Governmental
Authority or accounting standards board.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Borrower or any affected
Subsidiary proposes to take with respect thereto and at what time. Each
notice under subsection 6.3(a) shall describe with particularity any and all
clauses or provisions of this Agreement or other Loan Document that have been
(or foreseeably will be) breached or violated.
6.4 Preservation of Corporate Existence, Etc. The Borrower shall, and
shall cause each Material Subsidiary to preserve and maintain in full force
and effect its corporate existence and good standing under the laws of its
state or jurisdiction of incorporation and preserve and maintain in full
force and effect all governmental rights, privileges, qualifications,
permits, licenses and franchises necessary or desirable in the normal conduct
of its business except (a) if in the reasonable business judgment of the
Borrower or such Material Subsidiary, it is in its best economic interest not
to preserve or maintain such rights, privileges, qualification, permits,
licenses or franchises and (b) unless no Material Adverse Effect could result.
6.5 Maintenance of Property. The Borrower shall maintain, and shall cause
each Material Subsidiary to maintain, and preserve all its material property
(including, without limitation, equipment) which is used or useful in its
business in good working order and condition, ordinary wear and tear excepted
and make all necessary repairs thereto and renewals and replacements thereof
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect. The Borrower and each Material Subsidiary shall use
the standard of care typical in the industry in the operation and maintenance
of its facilities.
6.6 Insurance. The Borrower shall maintain, and shall cause each Material
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance against loss or damage of the kinds customarily insured
against by Persons engaged in the same
36
or similar business, of such types and
in such amounts as are customarily carried under similar circumstances by
such other Persons.
6.7 Payment of Obligations. The Borrower shall, and shall cause each
Material Subsidiary to, pay and discharge before the same shall become
delinquent:
(a) all tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being contested in
good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Material Subsidiary;
and
(b) all lawful claims which, if unpaid, would by law become a Lien upon its
property.
6.8 Compliance with Laws. The Borrower shall comply, and shall cause each
Subsidiary to comply, in all material respects with all Requirements of Law
of any Governmental Authority having jurisdiction over it or its business
(including Environmental laws and the federal Fair Labor Standards Act),
except such as may be contested in good faith or as to which a bona fide
dispute may exist.
6.9 Compliance with ERISA. The Borrower shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal
or state law; (b) cause each Plan which is qualified under Section 401(a) of
the Code to maintain such qualification; and (c) make all required
contributions to any Plan subject to Section 412 of the Code.
6.10 Inspection of Property and Books and Records. The Borrower shall
maintain and shall cause each Material Subsidiary to maintain proper books of
record and account, in which full, true and correct entries in conformity
with GAAP consistently applied shall be made of all financial transactions
and the assets and business of the Borrower and such Material Subsidiary.
During the continuance of any Event of Default, the Borrower shall permit,
and shall cause each Subsidiary to permit, representatives and independent
contractors of the Agent or any Bank to visit and inspect any of their
respective properties, to examine their respective corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the expense
of each the Borrower and at such reasonable times during normal business
hours and as often as may be reasonably desired, upon reasonable advance
notice to each the Borrower.
6.11 Use of Proceeds. The Borrower shall use the proceeds of the Loans for
working capital and other general corporate purposes (including repurchases
of its own stock) not in contravention of any Requirement of Law or of any
Loan Document.
6.12 Disclosure; Further Assurances.
(a) The Borrower shall ensure that all written information, exhibits and
reports furnished to the Agent and the Banks by or on behalf of the Borrower
and concerning the
37
Borrower do not and will not contain any untrue statement
of a material fact and do not and will not omit to state any material fact or
any fact necessary to make the statements contained therein not misleading in
light of the circumstances in which made, and will promptly disclose to the
Agent and the Banks and correct any material defect or error that may be
discovered therein or in any Loan Document or in the execution,
acknowledgement or recordation thereof; provided that nothing in this
Section 6.12(a) shall apply to any projections, forward-looking information
or other similar or related information furnished by or on behalf of the
Borrower or any Subsidiary in connection with the Loan Documents.
(b) The Borrower shall ensure that all projections, forward-looking
information or other similar or related information furnished by or on behalf
of the Borrower in connection with the Loan Documents are prepared in good
faith on the basis of the assumptions stated therein, which assumptions are
fair in the light of conditions existing at the time of delivery of such
forecasts, and represent, at the time of delivery, the Borrower or such
Subsidiary's best estimate of its future financial performance, operations
and results.
(c) The Borrower shall provide such other documentation and cooperation as
the Agent or the Required Banks reasonably request in connection with the
exercise by the Agent and the Banks of their rights and remedies under the
Loan Documents.
6.13 Financial Covenants. The Borrower will, unless the Required Banks
shall otherwise consent in writing:
(a) Maintenance of Consolidated Tangible Net Worth. Maintain as at the end
of each fiscal quarter a Consolidated Tangible Net Worth of the Borrower and
its Subsidiaries of not less than at any time the amount that is, (i) (A) the
greater of (x) 95% of Consolidated Tangible Net Worth as at fiscal quarter
ending September 1997, and (y) $1,279,000,000, plus (B) 75% of Consolidated
Net Income (excluding any Consolidated Net Loss) of the Borrower and its
Subsidiaries earned in each fiscal quarter after such September 1997 fiscal
quarter, plus (C) 75% of the amount of all proceeds (net of costs and
expenses) received pursuant to the issuance of any equity securities issued
by the Borrower after such September 1997 fiscal quarter (excluding proceeds
of any issuance made for the purposes of fulfilling an employee stock
purchase plan or compensatory option plan), plus (D) 100% of the face amount
of any Subordinated Indebtedness that is converted into stock of the Borrower
after such September 1997 fiscal quarter, minus (E) the amount, up to
$800,000,000, paid by the Borrower in respect of repurchases of its stock,
minus (F) an amount equal to the costs and expenses arising from or related
to mergers and acquisitions consummated by the Borrower and its Subsidiaries
and recognized in accordance with GAAP, provided that all such amounts
recognized shall be accounted for in the fiscal quarter in which the relevant
merger or acquisition is consummated and, provided further, that the total
amount of costs and expenses which may be excluded pursuant to this
subsection (F) shall at no time exceed $100,000,000 in the aggregate during
the initial term of this Agreement.
(b) Consolidated Net Income. Not permit (i) any Consolidated Net Loss or
Consolidated Operating Loss of the Borrower and its Subsidiaries to occur for
each of any two consecutive fiscal quarters (calculated as of the last day of
each such fiscal quarter); or
38
(ii) Consolidated Net Loss or Consolidated
Operating Loss of the Borrower and its Subsidiaries for any fiscal quarter to
be greater than $25,000,000; provided that in determining the Consolidated
Net Loss or Consolidated Operating Loss for any fiscal quarter for the
purposes of subparagraphs (i) and (ii) of this Section 6.13(b) there shall be
excluded the amount equal to costs and expenses arising from or related to
mergers and acquisitions consummated by the Borrower and its Subsidiaries and
recognized in accordance with GAAP; provided further, that all such amounts
recognized shall be accounted for in the fiscal quarter in which the relevant
merger or acquisition is consummated and provided that the total amount of
costs and expenses which may be excluded pursuant to this proviso shall at no
time exceed $100,000,000 in the aggregate during the initial term of this
Agreement.
(c) Consolidated Total Leverage Ratio. Not permit the Consolidated Total
Leverage Ratio of the Borrower and its Subsidiaries as determined at the end
of each fiscal quarter during the measurement periods set forth below to
exceed the correlative ratio set forth below:
Period Ratio
fiscal year-end 1998 40.0%
first fiscal quarter-end 1999 through first fiscal quarter-end
200045.0%
second fiscal quarter-end 2000 through first fiscal quarter-end
2001 40.0%
second fiscal quarter-end 2001 and thereafter 35.0%
(d) Adjusted Quick Ratio. Maintain a Consolidated Adjusted Quick Ratio for
the Borrower and its Subsidiaries as determined at the end of each fiscal
quarter during each of the measurement periods set forth below at least equal
to the correlative ratio for such period as set forth below:
Period Ratio
fiscal year-end 1998 0.95 : 1.00
first fiscal quarter-end 1999 through third fiscal quarter-end
19990.90 : 1.00
fiscal year-end 1999 through third fiscal quarter-end 20000.95 : 1.00
fiscal year-end 2000 and thereafter 1.20 : 1.00
(e) Senior Funded Debt. Not permit the Senior Funded Debt of the Borrower
and its Subsidiaries to exceed at any time $600,000,000.
6.14 Patents and Permits. The Borrower will, and will cause each of its
Subsidiaries to, (i) maintain all permits, licenses, consents or other
approvals of any Government
39
Authority or any Person and (ii) maintain in full
force and effect and protect patents, trademarks, tradenames or other
intellectual property rights, the failure of which to maintain or protect
would result in a Material Adverse Effect.
article VII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required
Banks waive compliance in writing:
7.1 Limitation on Liens. The Borrower shall not, and shall not suffer or
permit any Material Subsidiary to, directly or indirectly, make, create,
incur, assume or suffer to exist any Lien upon or with respect to any part of
its property, whether now owned or hereafter acquired, other than the
following ("Permitted Liens"):
(a) Liens for taxes, assessments or governmental charges or levies, and to
the extent not past due or to the extent contested, in good faith, by
appropriate proceedings and for which adequate reserves have been established
in accordance with GAAP;
(b) Liens imposed by law, such as materialman's, mechanic's, carrier's,
workman's, and repairman's Liens and other similar Liens arising in the
ordinary course of business which relate to obligations which are not overdue
for a period of more than 45 days or which are being contested in good faith,
by appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP;
(c) pledges or deposits in the ordinary course of business to secure
nondelinquent obligations under xxxxxxx'x compensation or unemployment laws
or similar legislation or to secure the performance of leases or trade
contracts entered into in the ordinary course of business or of public or
nondelinquent statutory obligations, bids, or appeal bonds;
(d) Liens upon or in any property acquired or held by the Borrower or any
of its Subsidiaries to secure the purchase price or construction costs (and,
to the extent financed, sales and excise taxes, delivery and installation
costs and other related expenses) of such property or to secure indebtedness
incurred solely for the purpose of financing or refinancing the acquisition
or construction of any such property to be subject to such Liens, or Liens
existing on any such property at the time of acquisition, or extensions,
renewals or replacements of any of the foregoing for the same or a lesser
principal amount, provided that no such Lien shall extend to or cover any
property other than the property being acquired or constructed and no such
extension, renewal or replacement shall extend to or cover any property not
theretofore subject to the Lien being extended, renewed or replaced;
(e) Liens consisting of the interest of a lessor upon any assets subject to
a Capital Lease and securing payment of the obligations arising under such
Capital Lease and provided that such Capital Lease is otherwise permitted
hereunder;
40
(f) zoning restrictions, easements, licenses, landlord's Liens or
restrictions on the use of any real property occupied by the Borrower or its
Subsidiaries, which do not materially impair the use of such property in the
operation of the business of the Borrower or any of its Subsidiaries or the
value of such property for the purpose of such business;
(g) Liens associated with judgments and awards to the extent such judgments
and awards do not create an Event of Default under subsection 8.1(i) hereof;
(h) Liens in favor of the issuer of a documentary commercial letter of
credit, provided, that such Liens are limited exclusively to the goods
covered by such letter of credit;
(i) Liens listed on Schedule 7.1(i) securing Indebtedness outstanding on
the Closing Date;
(j) Liens consisting of the interest of a lessor under Operating Leases
made in the ordinary course of business, or existing on property leased by
the Borrower or its Subsidiaries under an Operating Lease in the ordinary
course of business;
(k) Liens securing borrowings by the Borrower against life insurance
policies under which it is the beneficiary in an aggregate amount not to
exceed $40,000,000;
(l) Liens in connection with the Borrower's credit card processing program
in an aggregate amount not to exceed $20,000,000;
(m) Consensual Liens not described in subclauses (a) through (m) above
that; (i) relate to liabilities other than borrowed money debt (including
Liens incurred in connection with sales and leasebacks of the Borrower's
assets) and securing obligations not in excess of $30,000,000 in the
aggregate at any time for all such Liens for the Borrower and its
Subsidiaries together, or (ii) secure obligations not in excess of
$15,000,000 in the aggregate at any time for all such Liens for the Borrower
and its Subsidiaries together; provided that no Liens otherwise permitted by
clause (ii) shall be permitted against Receivables or inventories of the
Borrower or its Subsidiaries; and provided further that the obligations
secured by Liens permitted pursuant to clauses (i) and (ii) shall at no time,
in the aggregate, exceed $30,000,000; and
(n) Liens with respect to collateral (whether in cash, letters of credit or
other investments) provided in connection with the Multicurrency Note
Purchase Facility; provided that at no time shall the collateral with respect
to the Multicurrency Note Purchase Facility exceed, in the aggregate,
$140,000,000.
7.2 Disposition of Assets. The Borrower shall not, and shall not suffer or
permit any Material Subsidiary to, directly or indirectly, sell, assign,
lease, convey, transfer or otherwise dispose of (whether in one or a series
of transactions) any property (including accounts and notes receivable, with
or without recourse) or enter into any agreement to do any of the foregoing,
except:
41
(a) dispositions of inventory, or used, worn-out, obsolete or surplus
equipment or other assets not practically usable in the business of the
Borrower, all in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is exchanged
for credit against the purchase price of similar replacement equipment, or
the proceeds of such sale are reasonably promptly applied to the purchase
price of such replacement equipment;
(c) dispositions of assets in the ordinary course of business by the
Borrower or any of its Subsidiaries to the Borrower or any other of its
Subsidiaries pursuant to reasonable business requirements;
(d) dispositions in connection with a sale/leaseback transaction involving
real or personal property of the Borrower or its Subsidiaries; provided, that
any such sale/leaseback transaction is otherwise permitted under this
Agreement;
(e) dispositions not otherwise permitted hereunder; provided, that (i) at
the time of any disposition, no Event of Default shall exist or shall result
from such disposition, and (ii) the aggregate net book value of all assets so
sold by the Borrower and its Subsidiaries, together, shall not exceed in any
fiscal year an amount equal to 5% of Consolidated Total Assets of the
Borrower for such fiscal year; and
(f) dispositions listed on Schedule 7.2.
7.3 Consolidations and Mergers. The Borrower shall not, and shall not
suffer or permit any Subsidiary to, merge, consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions) all or substantially all of its assets
(whether now owned or hereafter acquired) to or acquire all or substantially
all of the assets of, any Person, except:
(a) any Subsidiary may merge with the Borrower, provided that the Borrower
shall be the continuing or surviving corporation, or with any one or more
Subsidiaries, provided that if any transaction shall be between a Subsidiary
and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be the
continuing or surviving corporation;
(b) any Subsidiary may sell all or substantially all of its assets (upon
voluntary liquidation or otherwise), to the Borrower or another Wholly-Owned
Subsidiary; and
(c) to the extent permitted by Section 7.2.
Nothing in this Section 7.3 shall prevent the Borrower or any of its
Subsidiaries from merging with, or acquiring all or substantially all of the
assets of any Person if (i) with respect to a merger, the Borrower or such
Subsidiary party to such merger is the surviving entity of such merger, and
(ii) the total assets (including securities and all other assets) so
acquired, together with the total assets for all such transactions occurring
after the Closing Date (in each case as measured on the effective date of
such merger or acquisition), do not exceed in any fiscal year an amount
greater than 30% of the Consolidated Tangible Net Worth of the Borrower and
its
42
Subsidiaries for such fiscal year and do not exceed in the aggregate
during the initial term of this Agreement $500,000,000, and (iii) the merger
or acquisition involves an entity engaged in a similar business to that of
the Borrower or in a business within the Borrower's strategic plans; and
(iv) no Default or Event of Default has occurred or would occur from such
merger or acquisition.
If any Acquisition or Investment is hostile, no proceeds of any Loan
may be used, directly or indirectly, therefor ("hostile" for purposes of this
sentence meaning the prior effective written consent of the board of
directors or equivalent governing body of the acquiree is not obtained).
7.4 Loans and Investments. The Borrower shall not purchase or acquire, or
suffer or permit any Material Subsidiary to purchase or acquire, or make any
commitment therefor, any capital stock, equity interest, or any obligations
or other securities of, or any interest in, any Person, or make or commit to
make any advance, loan, extension of credit or capital contribution to or any
other investment in, any Person including any Affiliate of the Borrower
(together, but excluding Acquisitions, "Investments"), except for:
(a) Investments held by the Borrower or any Material Subsidiary in the form
of cash equivalents;
(b) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) extensions of credit by the Borrower to any of its Subsidiaries or by
any of its Subsidiaries to another of its Subsidiaries;
(d) (i) Investments in any distributor of the Borrower's products or any
supplier of raw materials or services useful to the business of the Borrower
and its Subsidiaries (other than the acquisition of such Person by the
Borrower or its Subsidiaries), or in any partnership or corporation with
others, (ii) Joint-Ventures and (iii) other Investments, provided, that (A)
the book value (as to the Borrower) of any such Investment or Joint-Venture,
together with such value of all prior Investments or Joint-Ventures described
in clauses (i) through (iii) of this Section 6.4(d) undertaken by the
Borrower and its Subsidiaries after the Closing Date, shall not exceed at the
time of such Investment or Joint Venture, 15% of Consolidated Tangible Net
Worth as calculated as of the most recent fiscal quarter prior to such
Investment or Joint-Venture, (B) such Investments and Joint-Ventures are
undertaken in accordance with all applicable Requirements of Law and
(C) immediately prior to and after giving effect thereto, no Default or Event
of Default shall exist or be continuing;
(e) Investments constituting Permitted Swap Obligations or payments or
advances under Swap Contracts relating to Permitted Swap Obligations;
(f) Investments complying with the investment policy for the Borrower and
its Subsidiaries described on Schedule 7.4(f), as such schedule may be
amended from time to time;
43
(g) contributions, loans or advances to, or guarantees of, the Borrower or
any Subsidiary in connection with the Multicurrency Note Purchase Facility;
(h) loans to employees of the Borrower or any of its Subsidiaries (i) not
to exceed $20,000,000, exclusive of any loans permitted pursuant to
clause (ii), (valued without regard to any write-down due to
uncollectability) at any one time outstanding for all such loans to all
employees of the Borrower and its Subsidiaries in the aggregate, or (ii) in
the ordinary course of business with respect to travel and relocation
expenses; and
(i) repurchases of shares of Company stock.
7.5 Transactions with Affiliates. The Borrower shall not, and shall not
suffer or permit any Material Subsidiary to, enter into any transaction with
any Affiliate of the Borrower, except (i) transactions upon fair and
reasonable terms no less favorable to the Borrower or such Material
Subsidiary than it would obtain in a comparable arm's-length transaction with
a Person not an Affiliate of the Borrower or such Material Subsidiary and
(ii) transactions between Material Subsidiaries of the Borrower and
transactions between the Borrower and its Material Subsidiaries on terms fair
and reasonable to all interested parties and undertaken by all such parties
in good faith and in the ordinary course of business.
7.6 Use of Proceeds. The Borrower shall not, and shall not suffer or
permit any Subsidiary to, use any portion of the Loan proceeds, directly or
indirectly, for any purpose that would require the Agent or any Bank to
deliver or obtain any certification under, or to comply with the margin
requirements or other provisions of, Regulation T, U or X of the FRB.
7.7 Contingent Obligations. The Borrower shall not, and shall not suffer
or permit any Material Subsidiary to, create, incur, assume or suffer to
exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations in favor of BofA or any Affiliate of BofA
including, without limitation, in the form of recourse to the Borrower or
guaranties by the Borrower in connection with the Multicurrency Note Purchase
Facility;
(d) Contingent Obligations of the Borrower and its Subsidiaries existing as
of the Closing Date and listed in Schedule 7.7(e) and any renewals,
extensions or modifications thereof so long as the aggregate amount of such
Contingent Obligations does not increase from the amount existing on the
Closing Date;
(e) Contingent Obligations incurred in the ordinary course of business and
not exceeding at any time $30,000,000 in the aggregate in respect of the
Borrower and its Subsidiaries together;
(f) Contingent Obligations arising under the Loan Documents;
44
(g) Contingent Obligations arising in connection with Indebtedness of any
Subsidiary of the Borrower, provided, that such Indebtedness is otherwise
permitted by this Credit Agreement; and
(h) Contingent Obligations of the Borrower pursuant to guaranties in favor
of Leasetec Corporation and other leasing partners (or any of their
successors or assigns) so long as the aggregate amount thereof does not
exceed at any time $50,000,000.
7.8 Restricted Payments. The Borrower shall not, and shall not suffer or
permit any Subsidiary to, declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities
on account of any shares of any class of its capital stock, except that the
Borrower may (so long as there is no Default or Event of Default);
(a) declare and make dividend payments or other distributions payable
solely in its common stock;
(b) declare and make dividend payments in cash with respect to preferred
stock of the Borrower, so long as the aggregate amount of such cash used by
the Borrower pursuant to this clause (b) does not exceed $20,000,000 in any
fiscal year; provided further that (so long as there is no Default or Event
of Default) any Subsidiary may pay cash dividends or make other distributions
to the Borrower or, in the ordinary course of business of the Borrower and
its Subsidiaries taken as a whole, any other Subsidiary.
7.9 ERISA. The Borrower shall not, and shall not suffer or permit any of
its ERISA Affiliates to: (a) engage in a prohibited transaction or violation
of the fiduciary responsibility rules with respect to any Plan which has
resulted or could reasonably expected to result in liabilities of the
Borrower in an aggregate amount in excess of $10,000,000; or (b) engage in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
7.10 Change in Business. The Borrower shall not make any material change in
the nature of its business as conducted on the Closing Date.
7.11 Accounting Changes. The Borrower shall not and shall not suffer or
permit any Material Subsidiary to, make any significant change in accounting
treatment or reporting practices, except as required by GAAP, or change the
fiscal year of each the Borrower or any Material Subsidiary.
article VIII
EVENTS OF DEFAULT
8.1 Event of Default. Any of the following events shall constitute an
"Event of Default":
(a) Non-Payment. The Borrower fails to pay, (i) when and as required to be
paid herein, any amount of principal of any Loan, or (ii) within two Business
Days after the same
45
becomes due, any interest, fee or any other amount
payable hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by the
Borrower made or deemed made herein, in any other Loan Document, or which is
contained in any certificate, document or financial or other statement by the
Borrower, or any Responsible Officer, furnished at any time under this
Agreement, or in or under any other Loan Document, is incorrect in any
material respect on or as of the date made or deemed made; or
(c) Specific Defaults. The Borrower (i) fails to perform or observe any
term, covenant or agreement contained in Sections 6.3, 6.4, 6.11 or 6.13 or
in Article VII; or (ii) fails to perform or observe any term, covenant or
agreement contained in Sections 6.1, 6.2 or 6.9 and such failure shall
continue for five Business Days; or
(d) Other Defaults. The Borrower or any Subsidiary party thereto fails to
perform or observe any other term or covenant contained in this Agreement or
any other Loan Document, and such default shall continue unremedied for a
period of 30 days after the earlier of (i) the date upon which a Responsible
Officer knew or reasonably should have known of such failure or (ii) the date
upon which written notice thereof is given to the Borrower by the Agent or
any Bank; or
(e) Cross-Default. The Borrower or any Subsidiary (i) fails to make any
payment in respect of any Indebtedness or Contingent Obligation (other than
Indebtedness or Contingent Obligations hereunder), having an aggregate
principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than $20,000,000 when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) and such
failure shall continue for five Business Days; or (ii) fails to perform or
observe any other condition or covenant, or any other event shall occur or
condition exist, under any agreement or instrument relating to any such
Indebtedness or Contingent Obligation, if the effect of such failure, event
or condition is to cause, or to permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause such Indebtedness to be declared to be due and
payable prior to its stated maturity, or such Contingent Obligation to become
payable or cash collateral in respect thereof to be demanded; or
(f) Insolvency; Voluntary Proceedings. The Borrower or any Material
Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject
to applicable grace periods, if any, whether at stated maturity or otherwise;
(ii) voluntarily ceases to conduct its business in the ordinary course;
(iii) commences any Insolvency Proceeding with respect to itself; or
(iv) takes any action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings.
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(i) Any involuntary Insolvency Proceeding is commenced or filed against the
Borrower or any Material Subsidiary, or any writ,
judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial
part of the Borrower's or any Material Subsidiary's
properties, and any such proceeding or petition shall
not be dismissed, or such writ, judgment, warrant of
attachment, execution or similar process shall not be
released, vacated or fully bonded within 60 days
after commencement, filing or levy; (ii) the Borrower
or any Material Subsidiary admits the material
allegations of a petition against it in any
Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any
Insolvency Proceeding; or (iii) the Borrower or any
Material Subsidiary acquiesces in the appointment of
a receiver, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a
substantial portion of its property or business; or
(h) ERISA.
(i) An ERISA Event shall occur with respect to a Pension Plan or
Multiemployer Plan which has resulted or could
reasonably be expected to result in liability of the
Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount
in excess of $20,000,000; (ii) the aggregate amount
of Unfunded Pension Liability among all Pension Plans
at any time exceeds $20,000,000; or (iii) the
Borrower or any ERISA Affiliate shall fail to pay
when due, after the expiration of any applicable
grace period, any installment payment with respect to
its withdrawal liability under Section 4201 of ERISA
under a Multiemployer Plan in an aggregate amount in
excess of $20,000,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against
the Borrower or any Subsidiary involving in the aggregate a liability (to the
extent not covered by independent third-party insurance as to which the
insurer does not dispute coverage) as to any single or related series of
transactions, incidents or conditions, of $20,000,000 or more, and the same
shall remain unvacated and unstayed pending appeal for a period of 30
consecutive days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is
entered against the Borrower or any Subsidiary which does or would reasonably
be expected to have a Material Adverse Effect, and there shall be any period
of 30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
47
(k) Change of Control. There occurs any Change of Control; or
(l) Adverse Change. There occurs a Material Adverse Effect.
8.2 Remedies. If any Event of Default occurs and is continuing, the Agent
shall, at the request of, or may, with the consent of, the Required Banks,
(a) declare the obligation of each Bank to make Loans, whereupon such
obligations and such Bank's Commitments shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of
which are hereby expressly waived by the Borrower; and
(c) exercise on behalf of itself and the Banks all rights and remedies
available to it and the Banks under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in
subsection (f) or (g) of Section 8.1 (in the case of clause (i) of
subsection (g) upon the expiration of the 60-day period mentioned therein),
the obligation of each Bank to make Loans shall automatically terminate and
the unpaid principal amount of all outstanding Loans and all interest and
other amounts as aforesaid shall automatically become due and payable without
further act of the Agent or any Bank.
8.3 Certain Financial Covenant Defaults. In the event that, after taking
into account any extraordinary charge to earnings taken or to be taken as of
the end of any fiscal period of the Borrower (a "Charge"), and if solely by
virtue of such Charge, there would exist an Event of Default due to the
breach of any of Section 6.13 as of such fiscal period end date, such Event
of Default shall be deemed to arise upon the earlier of (a) the date after
such fiscal period end date on which the Borrower announces publicly it will
take, is taking or has taken such Charge (including an announcement in the
form of a statement in a report filed with the SEC) or, if such announcement
is made prior to such fiscal period end date, the date that is such fiscal
period end date, and (b) the date the Borrower delivers to the Agent its
audited annual or unaudited quarterly financial statements in respect of such
fiscal period reflecting such Charge as taken.
article IX
THE AGENT
9.1 Appointment and Authorization; "Agent". Each Bank hereby irrevocably
(subject to Section 9.9) appoints, designates and authorizes the Agent to
take such action on its behalf under the provisions of this Agreement and
each other Loan Document and to exercise such powers and perform such duties
as are expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained elsewhere
in this Agreement or in any other Loan Document, the Agent shall not have any
duties or responsibilities, except those expressly set forth herein, nor
shall the Agent have or be deemed to have any fiduciary
48
relationship with any
Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other
Loan Document or otherwise exist against the Agent. Without limiting the
generality of the foregoing sentence, the use of the term "agent" in this
Agreement with reference to the Agent is not intended to connote any
fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a
matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties.
9.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for
the negligence or misconduct of any agent or attorney-in-fact that it selects
with reasonable care.
9.3 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Banks for any
recital, statement, representation or warranty made by the Borrower or any
Subsidiary or Affiliate of the Borrower, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by
the Agent under or in connection with, this Agreement or any other Loan
Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure
of the Borrower or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under
any obligation to any Bank to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrower or any of the Borrower's Subsidiaries or Affiliates.
9.4 Reliance by Agent. (a) The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or
telephone message, statement or other document or conversation believed by it
to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel (including
counsel to the Borrower), independent accountants and other experts selected
by the Agent. The Agent shall be fully justified in failing or refusing to
take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required Banks as it
deems appropriate and, if it so requests, it shall first be indemnified to
its satisfaction by the Banks against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such
action. The Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Banks and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all of the Banks.
49
(b) For purposes of determining compliance with the conditions specified in
Section 4.1, each Bank that has executed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent (or made available) by the Agent to such
Bank for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory to
such Bank, unless an officer of the Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Bank
prior to the Closing Date specifying its objection thereto and such objection
shall not have been withdrawn by notice to the Agent to that effect on or
prior to the Closing Date.
9.5 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, except with
respect to defaults in the payment of principal, interest and fees required
to be paid to the Agent for the account of the Banks, unless the Agent shall
have received written notice from a Bank or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Banks of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Required Banks in
accordance with Article VIII; provided, however, that unless and until the
Agent has received any such request, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable or in
the best interest of the Banks.
9.6 Credit Decision. Each Bank acknowledges that none of the Agent-Related
Persons has made any representation or warranty to it, and that no act by the
Agent hereinafter taken, including any review of the affairs of the Borrower
and its Subsidiaries, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Bank. Each Bank represents to
the Agent that it has, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and its Subsidiaries, the value of and title
to any collateral, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Borrower hereunder. Each Bank
also represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement
and the other Loan Documents, and to make such investigations as it deems
necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the
Borrower. Except for notices, reports and other documents expressly herein
required to be furnished to the Banks by the Agent, the Agent shall not have
any duty or responsibility to provide any Bank with any credit or other
information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of the Borrower which may
come into the possession of any of the Agent-Related Persons.
9.7 Indemnification of Agent. Whether or not the transactions contemplated
hereby are consummated, the Banks shall indemnify upon demand the
Agent-Related Persons (to
50
the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower to do so), in
accordance with the Banks' Pro Rata Shares from and against any and all
Indemnified Liabilities; provided, however, that no Bank shall be liable for
the payment to the Agent-Related Persons of any portion of such Indemnified
Liabilities to the extent that they are found by a final decision of a court
of competent jurisdiction to have resulted solely from such Person's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Bank shall reimburse the Agent upon demand for its ratable share of any costs
or out-of-pocket expenses (including Attorney Costs) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any
document contemplated by or referred to herein, to the extent that the Agent
is not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the Agent.
9.8 Agent in Individual Capacity. BofA and its Affiliates may make loans
to, accept deposits from, acquire equity interests in and generally engage in
any kind of banking, trust, financial advisory, underwriting or other
business with the Borrower and its Subsidiaries and Affiliates (including,
without limitation, as "Agent" and as a "Bank" under the $350MM Credit
Agreement) in each case, as though BofA were not the Agent hereunder and
without notice to or consent of the Banks. The Banks acknowledge that,
pursuant to such activities, BofA or its Affiliates may receive information
regarding the Borrower or its Affiliates (including information that may be
subject to confidentiality obligations in favor of the Borrower or such
Subsidiary) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, BofA shall have
the same rights and powers under this Agreement as any other Bank and may
exercise the same as though it were not the Agent.
9.9 Successor Agent. The Agent may, and at the request of the Required
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Required Banks shall appoint from among the
Banks a successor agent for the Banks. If no successor agent is appointed
prior to the effective date of the resignation of the Agent, the Agent may
appoint, after consulting with the Banks and the Borrower, a successor agent
from among the Banks. Upon the acceptance of its appointment as successor
agent hereunder, such successor agent shall succeed to all the rights, powers
and duties of the retiring Agent and the term "Agent" shall mean such
successor agent and the retiring Agent's appointment, powers and duties as
Agent shall be terminated. After any retiring Agent's resignation hereunder
as Agent, the provisions of this Article IX and Sections 10.4 and 10.5 shall
inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement. If no successor agent has accepted
appointment as Agent by the date which is 30 days following a retiring
Agent's notice of resignation, the retiring Agent's resignation shall
nevertheless thereupon become effective and the Banks shall perform all of
the duties of the Agent hereunder until such time, if any, as the Required
Banks appoint a successor agent as provided for above.
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9.10 Withholding Tax. (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441
or 1442 of the Code, such Bank agrees to deliver to the Agent and the
Borrower:
(i) if such Bank claims an exemption from, or a reduction of, withholding
tax under a United States tax treaty, two properly
completed and executed copies of IRS Form 1001 before
the payment of any interest or fees in the first
calendar year and before the payment of any interest
or fees in each third succeeding calendar year during
which interest or fees may be paid under this
Agreement;
(ii) if such Bank claims that interest paid under this Agreement is exempt
from United States withholding tax because it is
effectively connected with a United States trade or
business of such Bank, two properly completed and
executed copies of IRS Form 4224 before the payment
of any interest or fees is due in the first taxable
year of such Bank and in each succeeding taxable year
of such Bank during which interest or fees may be
paid under this Agreement; and
(iii) such other form or forms as may be required under the Code or other
laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent and the Borrower of any change
in circumstances which would modify or render invalid any claimed exemption
or reduction.
(b) If any Bank claims exemption from, or reduction of, withholding tax
under a United States tax treaty by providing IRS Form 1001 and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part
of the Obligations of the Borrower owing to such Bank, such Bank agrees to
notify the Agent and the Borrower of the percentage amount in which it is no
longer the beneficial owner of Obligations of the Borrower owing to such
Bank. To the extent of such percentage amount, the Agent and the Borrower
will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding tax by
filing IRS Form 4224 with the Agent and the Borrower sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of
the Borrower to such Bank, such Bank agrees to undertake sole responsibility
for complying with the withholding tax requirements imposed by Sections 1441
and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable withholding
tax, the Borrower (or if not withheld by the Borrower the Agent) may withhold
from any interest payment to such Bank, or to the Agent on behalf of such
Bank, an amount equivalent to the
52
applicable withholding tax after taking
into account such reduction. However, if the forms or other documentation
required by subsection (a) of this Section are not delivered to the Agent and
the Borrower, then the Borrower (or the Agent, if not withheld by the
Borrower) may withhold from any interest payment to such Bank, or to the
Agent on behalf of such Bank, not providing such forms or other documentation
an amount equivalent to the applicable withholding tax imposed by Sections
1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United States or
other jurisdiction asserts a claim that the Borrower or the Agent did not
properly withhold tax from amounts paid to or for the account of any Bank
(because the appropriate form was not delivered or was not properly executed,
or because such Bank failed to notify the Borrower or the Agent of a change
in circumstances which rendered the exemption from, or reduction of,
withholding tax ineffective, or for any other reason) such Bank shall
indemnify the Borrower or the Agent fully for all amounts paid, directly or
indirectly, by the Borrower or the Agent as tax or otherwise, including
penalties and interest, and including any taxes imposed by any jurisdiction
on the amounts payable to the Borrower or the Agent under this Section,
together with all costs and expenses (including Attorney Costs). The
obligation of the Banks under this subsection shall survive the payment of
all Obligations and the resignation or replacement of the Agent.
9.11 Co-Agents. None of the Banks identified in the preamble or signature
pages of this Agreement as a "co-agent" shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Banks as such. Without limiting the foregoing, none
of the Banks so identified as a "co-agent" shall have or be deemed to have
any fiduciary relationship with any Bank. Each Bank acknowledges that it has
not relied, and will not rely, on any of the Banks so identified in deciding
to enter into this Agreement or in taking or not taking action hereunder.
article X
MISCELLANEOUS
10.1 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Borrower or any applicable Subsidiary therefrom, shall be
effective unless the same shall be in writing and signed by the Required
Banks (or by the Agent at the written request of the Required Banks) and the
Borrower and acknowledged by the Agent, and then any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no such waiver, amendment, or
consent shall, unless in writing and signed by all the Banks and the Borrower
and acknowledged by the Agent, do any of the following:
(a) increase or extend the Commitment of any Bank;
(b) postpone or delay any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Banks (or any of them) hereunder or under any other Loan Document;
53
(c) reduce the principal of, or the rate of interest specified herein on
any Loan, or any fees or other amounts payable hereunder or under any other
Loan Document;
(d) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for the Banks or any of them
to take any action hereunder; or
(e) amend this Section, or Section 2.13, or any provision herein providing
for consent or other action by all Banks; and, provided, further, that no
amendment, waiver or consent shall, unless in writing and signed by the Agent
in addition to the Required Banks or all the Banks, as the case may be,
affect the rights or duties of the Agent under this Agreement or any other
Loan Document.
10.2 Notices. (a) All notices, requests, consents, approvals, waivers
and other communications shall be in writing (including, unless the context
expressly otherwise provides, by facsimile transmission, provided that any
matter transmitted by the Borrower by facsimile (i) shall be immediately
confirmed by a telephone call to the recipient at the number specified on
Schedule 10.2, and (ii) shall be followed promptly by delivery of a hard copy
original thereof) and mailed, faxed or delivered, to the address or facsimile
number specified for notices on Schedule 10.2; or, as directed to the
Borrower or the Agent, to such other address as shall be designated by such
party in a written notice to the other parties, and as directed to any other
party, at such other address as shall be designated by such party in a
written notice to the Borrower and the Agent. All notices to the Borrower
shall be sent to Storage Technology Corporation, 0000 Xxxxx 00xx Xxxxxx,
Xxxxxxxxxx, XX 00000-0000, Attention: Treasurer, Telecopy No.:
(000) 000-0000.
(b) All such notices, requests and communications shall, when transmitted
by overnight delivery, or faxed, be effective when delivered for overnight
(next-day) delivery, or transmitted in legible form by facsimile machine,
respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mails, or if delivered, upon delivery; except that
notices pursuant to Article II or IX to the Agent shall not be effective
until actually received by the Agent.
(c) Any agreement of the Agent and the Banks herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Borrower. The Agent and the Banks shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Borrower to give such notice and the Agent and the Banks shall not have any
liability to the Borrower or other Person on account of any action taken or
not taken by the Agent or the Banks in reliance upon such telephonic or
facsimile notice. The obligation of the Borrower to repay the Loans shall
not be affected in any way or to any extent by any failure by the Agent and
the Banks to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Agent and the Banks of a confirmation which is
at variance with the terms understood by the Agent and the Banks to be
contained in the telephonic or facsimile notice.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Agent or any Bank, any right, remedy, power or
privilege
54
hereunder, shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights provided for in this Agreement
and the other Loan Documents are cumulative and are not exclusive of any
other rights, powers, privileges or remedies provided by law or in equity, or
under any other instrument, document or agreement now existing or hereafter
arising.
10.4 Costs and Expenses. The Borrower shall:
(a) whether or not the transactions contemplated hereby are consummated,
pay or reimburse the Agent within five Business Days after demand (subject to
subsection 4.1(e)) for all costs and expenses incurred by the Agent in
connection with the development, preparation, delivery, ongoing
administration and execution of, and any amendment, supplement, waiver or
modification to (in each case, whether or not consummated), this Agreement,
any Loan Document and any other documents prepared in connection herewith or
therewith, and the consummation of the transactions contemplated hereby and
thereby, including reasonable Attorney Costs and search and filing fees and
expenses incurred by the Agent with respect thereto;
(b) pay or reimburse the Agent and the Arranger and each Bank within five
Business Days after demand (subject to subsection 4.1(e)) for all costs and
expenses (including reasonable Attorney Costs and search and filing fees and
expenses provided that the Borrower shall have been given statements
containing reasonably detailed bills for such fees and expenses) incurred by
them in connection with the enforcement or preservation of any rights or
remedies under this Agreement or any other Loan Document during the existence
of an Event of Default or after acceleration of the Loans (including in
connection with any "workout" or restructuring regarding the Loans, and
including in any Insolvency Proceeding or appellate proceeding); and
(c) during the continuance of any Event of Default, pay or reimburse the
Agent within five Business Days after demand for all appraisal (including the
allocated cost of internal appraisal services), audit, environmental
inspection and review (including the allocated cost of such internal
services), incurred or sustained by the Agent in connection with the matters
referred to under subsections (a) and (b) of this Section.
10.5 Borrower's Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify, defend and
hold the Agent-Related Persons, and each Bank and each of its respective
officers, directors, employees, counsel, agents and attorneys-in-fact (each,
an "Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement of the
Agent or replacement of any Bank) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this
Agreement or any document contemplated by or referred to herein, or the
transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with
respect to any investigation, litigation or proceeding
55
(including any
Insolvency Proceeding or appellate proceeding) related to or arising out of
this Agreement or the Loans whether or not any Indemnified Person is a party
thereto (all the foregoing, collectively, the "Indemnified Liabilities");
provided, that the Borrower shall have no obligation hereunder to any
Indemnified Person with respect to Indemnified Liabilities to the extent they
are found by a final decision of a court of competent jurisdiction to have
resulted solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of
all other Obligations.
10.6 Payments Set Aside. To the extent that the Borrower makes a payment to
the Agent or the Banks, or the Agent or the Banks exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or
any other party, in connection with any Insolvency Proceeding or otherwise,
then (a) to the extent of such recovery the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full
force and effect as if such payment had not been made or such set-off had not
occurred, and (b) each Bank severally agrees to pay to the Agent upon demand
its pro rata share of any amount so recovered from or repaid by the Agent.
10.7 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the
prior written consent of the Agent and each Bank.
10.8 Assignments, Participations, Etc.
(a) Any Bank may, with the written consent of the Borrower at all times
other than during the existence of an Event of Default and the Agent, (which
consents shall not be unreasonably withheld), at any time assign and delegate
to one or more Eligible Assignees (provided that no written consent of the
Borrower or the Agent shall be required in connection with any assignment and
delegation by a Bank to an Eligible Assignee that is an Affiliate of such
Bank or that is a Bank then holding a Commitment hereunder) (each an
"Assignee") all, or any ratable part of all, of the Loans, the Commitments
and the other rights and obligations of such Bank hereunder, provided, that
any such assigning Bank either retains a Commitment or Loan of at least
$15,000,000 or disposes of its entire Commitment or Loans and provided
further that any Assignee shall have a Commitment or Loans of at least
$15,000,000; provided, however, that the Borrower and the Agent may continue
to deal solely and directly with such Bank in connection with the interest so
assigned to an Assignee until (i) written notice of such assignment, together
with payment instructions, addresses and related information with respect to
the Assignee, shall have been given to the Borrower and the Agent by such
Bank and the Assignee; (ii) such Bank and its Assignee shall have delivered
to the Borrower and the Agent an Assignment and Acceptance in the form of
Exhibit E ("Assignment and Acceptance") together with any Note or Notes
subject to such assignment and (iii) the assignor Bank or Assignee has paid
to the Agent a processing fee in the amount of $4,000. No Assignee shall be
entitled to higher recoveries or greater rights under Sections 3.1, 3.2 and
3.3 than its assignor.
56
(b) From and after the date that the Agent notifies the assignor Bank that
it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank
under the Loan Documents, (ii) this Agreement shall be deemed to be amended
to the extent, but only to the extent, necessary to reflect the addition of
the Assignee and the resulting adjustment of the Commitments and Loans
arising therefrom, and (iii) the assignor Bank shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Loan Documents;
provided, however, that the assignor Bank shall not relinquish its rights
under Article III or under Sections 10.4 and 10.5 to the extent such rights
relate to the time prior to the effective date of the Assignment and
Acceptance. The Commitment allocated to each Assignee shall reduce the
Commitment of the assigning Bank pro tanto.
(c) Within five Business Days after its receipt of notice by the Agent that
it has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in
accordance with subsection 10.8(a)), the Borrower shall execute and deliver
to the Agent, any new Notes requested by such Assignee evidencing such
Assignee's assigned Loans and Commitment and, if the assignor Bank has
retained a portion of its Loans and its Commitment, replacement Notes as
requested by the assignor Bank evidencing the Loans and Commitment retained
by such assignor Bank (such Notes to be in exchange for, but not in payment
of, the Notes held by such Bank).
(d) Any Bank may at any time sell to one or more commercial banks or other
Persons not Affiliates of the Borrower (a "Participant") participating
interests in any Loans, the Commitment of that Bank and the other interests
of that Bank (the "originating Bank") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Bank's obligations
under this Agreement shall remain unchanged, (ii) the originating Bank shall
remain solely responsible for the performance of such obligations, (iii) the
Borrower and the Agent shall continue to deal solely and directly with the
originating Bank in connection with the originating Bank's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no
Bank shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the
extent such amendment, consent or waiver would require unanimous consent of
the Banks as described in the first proviso to Section 10.1. In the case of
any such participation, the Participant shall be entitled to the benefit of
Sections 3.1, 3.3 and 10.5 as though it were also a Bank hereunder, and not
otherwise have any rights under this Agreement, or any of the other Loan
Documents, and all amounts payable by the Borrower hereunder shall be
determined as if such Bank had not sold such participation; except that, if
amounts outstanding under this Agreement are due and unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall be deemed to have the right of
set-off in respect of its participating interest in amounts owing under this
Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Bank under this Agreement.
57
(e) Notwithstanding any other provision in this Agreement, any Bank may at
any time create a security interest in, or pledge, all or any portion of its
rights under and interest in this Agreement and any Note held by it in favor
of any Federal Reserve Bank in accordance with Regulation A of the FRB or
U.S. Treasury Regulation 31 CFR SS203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
10.9 Confidentiality. Each Bank and the Agent agrees that it will not
disclose to any third party any written information marked "Confidential,"
"Secret," "Top Security," "Protected" or words of similar import, provided to
it by the Borrower or any Subsidiary or any oral information which is stated
to be confidential and which is confirmed as such in writing within seven
days; provided, however, that the foregoing will not (i) restrict the ability
of the Agent, the Banks and any loan participants from freely exchanging such
information among themselves (and their respective employees, attorneys,
auditors and other professional advisors), (ii) restrict the ability to
disclose such information to a prospective Eligible Assignee or participants,
provided, that such Eligible Assignee or participants execute a
confidentiality agreement with the selling Bank agreeing to be bound by the
terms hereof prior to disclosure of such information to such Eligible
Assignee or participant, or (iii) prohibit the disclosure of such information
to the extent such information (A) becomes publicly available other than
through a breach of this Section 10.9, (B) becomes available through a Person
other than the Borrower or a Subsidiary of the Borrower, (C) is required to
be disclosed pursuant to court order, subpoena, other legal process,
regulatory request or otherwise by law or (D) is disclosed in litigation with
the Borrower or any Subsidiary of the Borrower or in connection with the
enforcement of remedies by the Agent or Banks after acceleration of the Loans
or after the Termination Date.
10.10 Set-off. In addition to any rights and remedies of the Banks provided
by law, if an Event of Default exists or the Loans have been accelerated,
each Bank is authorized at any time and from time to time, without prior
notice to the Borrower, any such notice being waived by the Borrower to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held
by, and other indebtedness at any time owing by, such Bank to or for the
credit or the account of the Borrower against any and all Obligations owing
to such Bank, now or hereafter existing, irrespective of whether or not the
Agent or such Bank shall have made demand under this Agreement or any Loan
Document and although such Obligations may be contingent or unmatured. Each
Bank agrees promptly to notify the Borrower and the Agent after any such
set-off and application made by such Bank; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application.
10.11 Automatic Debits of Fees. With respect to any commitment fee, letter
of credit fee or other fee, or any other cost or expense (including Attorney
Costs) due and payable to the Agent, BofA or the Arranger under the Loan
Documents, the Borrower hereby irrevocably authorizes BofA to debit any
deposit account of the Borrower with BofA in an amount such that the
aggregate amount debited from all such deposit accounts does not exceed such
fee or other cost or expense. If there are insufficient funds in such
deposit accounts to cover the amount of the fee or other cost or expense then
due, such debits will be reversed (in whole or in part, in
58
BofA's sole
discretion) and such amount not debited shall be deemed to be unpaid. No
such debit under this Section shall be deemed a set-off.
10.12 Notification of Addresses, Lending Offices, Etc. Each Bank shall
notify the Agent in writing of any changes in the address to which notices to
the Bank should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of
such other administrative information as the Agent shall reasonably request.
10.13 Counterparts. This Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an original,
and all of said counterparts taken together shall be deemed to constitute but
one and the same instrument.
10.14 Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required
hereunder.
10.15 No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of the Borrower, the Banks, the
Agent and the Agent-Related Persons, and their permitted successors and
assigns, and no other Person shall be a direct or indirect legal beneficiary
of, or have any direct or indirect cause of action or claim in connection
with, this Agreement or any of the other Loan Documents.
10.16 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF CALIFORNIA; PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA
OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE BORROWER, THE AGENT AND
THE BANKS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE BORROWER, THE AGENT
AND THE BANKS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO
THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO.
THE BORROWER, THE AGENT AND THE BANKS EACH WAIVE PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY CALIFORNIA LAW.
59
10.17 Waiver of Jury Trial. THE BORROWER, THE BANKS AND THE AGENT EACH WAIVE
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE,
WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE
BORROWER, THE BANKS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF
ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE
FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL
BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM
OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE
VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
10.18 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the
Borrower, the Banks and the Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
(Remainder of page intentionally left blank)
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in San Francisco by their proper and duly
authorized officers as of the day and year first above written.
STORAGE TECHNOLOGY CORPORATION,
a Delaware Corporation
By: /s/ Xxxx X. XxXxxxxx
Title: Vice President and Treasurer
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION,
as Agent and as a Bank
By: /s/ Xxxxx XxXxxxx
Title: Managing Director
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxx X. Xxxxx
Title: First Vice President
BANKBOSTON, N.A.
By: /s/ Xxxx X. Xxxxxxx
Title: Vice President
NORWEST BANK COLORADO, N.A.
By: /s/ Xxxxxxx Xxxxx
Title: Vice President
ABN AMRO BANK N.V.
By: /s/ Xxx-Xxx Mino; Xxxxx X. Xxxx
Title: Vice President; Vice President
BANK OF MONTREAL
By: /s/ Xxxx Xxxx
Title: Director
THE BANK OF NOVA SCOTIA
By: /s/ Xxx Xxxxxxx
Title: Relationship Manager
FLEET NATIONAL BANK
By: /s/ Xxxxx Xxxxxx
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxx
Title: Asst. Vice President
