Exhibit 10.1
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CREDIT AGREEMENT
dated as of
December 20, 1995
among
JOSTENS, INC.
THE LENDERS NAMED HEREIN
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Agent
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................................... 1
ARTICLE II THE CREDITS........................................................................... 14
2.1. Description of Facility............................................................... 14
2.2. Availability of Facility.............................................................. 14
2.3. Committed Advances.................................................................... 15
2.3.1. Commitment................................................................... 15
2.3.2. Ratable Loans; Types of Advances............................................. 15
2.3.3. Minimum Amount of Each Committed Advance..................................... 15
2.3.4. Applicable Margin............................................................ 15
2.3.5. Method of Selecting Types and Interest Periods
for New Committed Advances.................................................. 17
2.3.6. Conversion and Continuation of Outstanding Advances.......................... 18
2.4. Competitive Bid Advances.............................................................. 19
2.4.1. Competitive Bid Option;
Repayment of Competitive Bid Advances....................................... 19
2.4.2. Competitive Bid Quote Request................................................ 19
2.4.3. Invitation for Competitive Bid Quotes........................................ 20
2.4.4. Submission and Contents of Competitive Bid Quotes............................ 20
2.4.5. Notice to Borrower........................................................... 22
2.4.6. Acceptance and Notice by Borrower............................................ 23
2.4.7. Allocation by the Agent...................................................... 23
2.4.8. Administration Fee........................................................... 24
2.5. Method of Borrowing................................................................... 24
2.6. Fees ............................................................................. 24
2.6.1. Facility Fee................................................................. 24
2.6.2. Agent's Fees................................................................. 24
2.7. Reductions in Aggregate Commitment; Principal Payments................................ 24
2.7.1. Reductions in Aggregate Commitment........................................... 24
2.7.2. Principal Payments........................................................... 25
2.8. Changes in Interest Rate, etc......................................................... 25
2.9. Rates Applicable After Default........................................................ 26
2.10. Method of Payment..................................................................... 26
2.10.1. General...................................................................... 26
2.10.2. Currency of Payment.......................................................... 26
2.11. Notes; Telephonic Notices............................................................. 27
2.12. Interest Payment Dates; Interest and Fee Basis........................................ 27
2.13. Notification of Advances, Interest Rates, Prepayments and Commitment Reductions....... 28
2.14. Lending Installations................................................................. 28
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2.15. Non-Receipt of Funds by the Agent..................................................... 28
2.16. Withholding Tax Exemption............................................................. 29
2.17. Increases in Aggregate Commitment..................................................... 29
ARTICLE III CHANGE IN CIRCUMSTANCES............................................................... 31
3.1. Taxes ............................................................................. 31
3.1.1. Payments to be Free and Clear................................................ 31
3.1.2. Grossing-up of Payments...................................................... 31
3.2. Yield Protection...................................................................... 32
3.3. Changes in Capital Adequacy Regulations............................................... 33
3.4. Availability of Types of Advances..................................................... 34
3.5. Funding Indemnification............................................................... 34
3.6. Mitigation of Additional Costs or Adverse Circumstances............................... 34
3.7. Lender Statements; Survival of Indemnity.............................................. 35
3.8. Market Disruption..................................................................... 36
ARTICLE IV CONDITIONS PRECEDENT.................................................................. 36
4.1. Initial Advance....................................................................... 36
4.2. Each Advance.......................................................................... 37
ARTICLE V REPRESENTATIONS AND WARRANTIES........................................................ 38
5.1. Corporate Existence and Standing...................................................... 38
5.2. Authorization and Validity............................................................ 38
5.3. No Conflict; Government Consent....................................................... 38
5.4. Financial Statements.................................................................. 39
5.5. Material Adverse Change............................................................... 39
5.6. Taxes ............................................................................. 39
5.7. Litigation and Contingent Obligations................................................. 39
5.8. Subsidiaries.......................................................................... 39
5.9. ERISA ............................................................................. 39
5.10. Accuracy of Information............................................................... 40
5.11. Regulation U.......................................................................... 40
5.12. Material Agreements................................................................... 40
5.13. Compliance With Laws.................................................................. 40
5.14. Investment Company Act................................................................ 41
5.15. Public Utility Holding Company Act.................................................... 41
ARTICLE VI COVENANTS............................................................................. 41
6.1. Financial Reporting................................................................... 41
6.2. Use of Proceeds....................................................................... 43
6.3. Notice of Default..................................................................... 43
6.4. Conduct of Business................................................................... 43
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6.5. Taxes ............................................................................. 43
6.6. Insurance............................................................................. 43
6.7. Compliance with Laws.................................................................. 43
6.8. Maintenance of Properties............................................................. 44
6.9. Inspection............................................................................ 44
6.10. Merger ............................................................................. 44
6.11. Sale of Assets........................................................................ 44
6.12. Investments and Acquisitions.......................................................... 45
6.13. Subsidiary Indebtedness............................................................... 46
6.14. Contingent Obligations................................................................ 46
6.15. Liens ............................................................................. 46
6.16. Interest Coverage Ratio............................................................... 48
6.17. Net Worth............................................................................. 49
6.18. Affiliates............................................................................ 49
ARTICLE VII DEFAULTS ............................................................................. 49
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND EMEDIES......................................... 51
8.1. Acceleration.......................................................................... 51
8.2. Amendments............................................................................ 52
8.3. Preservation of Rights................................................................ 52
ARTICLE IX GENERAL PROVISIONS.................................................................... 53
9.1. Survival of Representations........................................................... 53
9.2. Governmental Regulation............................................................... 53
9.3. Taxes................................................................................. 53
9.4. Headings.............................................................................. 53
9.5. Entire Agreement...................................................................... 53
9.6. Several Obligations; Benefits of this Agreement....................................... 53
9.7. Expenses; Indemnification............................................................. 54
9.8. Numbers of Documents.................................................................. 55
9.9. Accounting............................................................................ 55
9.10. Severability of Provisions............................................................ 55
9.11. Nonliability of Lenders............................................................... 55
9.12. CHOICE OF LAW......................................................................... 55
9.13. CONSENT TO JURISDICTION............................................................... 56
9.14. WAIVER OF JURY TRIAL.................................................................. 56
9.15. Confidentiality....................................................................... 56
ARTICLE X THE AGENT............................................................................. 56
10.1. Appointment........................................................................... 56
10.2. Powers ............................................................................. 56
10.3. General Immunity...................................................................... 57
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10.4. No Responsibility for Loans, Recitals, etc............................................ 57
10.5. Action on Instructions of Lenders..................................................... 57
10.6. Employment of Agents and Counsel...................................................... 57
10.7. Reliance on Documents; Counsel........................................................ 58
10.8. Agent's Reimbursement and Indemnification............................................. 58
10.9. Rights as a Lender.................................................................... 58
10.10. Lender Credit Decision................................................................ 58
10.11. Successor Agent....................................................................... 59
ARTICLE XI SETOFF; RATABLE PAYMENTS.............................................................. 60
11.1. Setoff ............................................................................. 60
11.2. Ratable Payments...................................................................... 60
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS;PARTICIPATIONS...................................... 60
12.1. Successors and Assigns................................................................ 60
12.2. Participations........................................................................ 61
12.2.1 Permitted Participants; Effect............................................... 61
12.2.2. Voting Rights................................................................ 61
12.3. Assignments........................................................................... 61
12.3.1. Permitted Assignments........................................................ 61
12.3.2. Effect; Effective Date....................................................... 61
12.4. Dissemination of Information.......................................................... 62
12.5. Tax Treatment......................................................................... 62
ARTICLE XIII NOTICES............................................................................... 62
13.1. Giving Notice......................................................................... 62
13.2. Change of Address..................................................................... 63
ARTICLE XIV COUNTERPARTS.......................................................................... 63
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CREDIT AGREEMENT
This Agreement, dated as of December 20, 1995, is among Jostens, Inc., the
Lenders and The First National Bank of Chicago, as Agent. The parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
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As used in this Agreement:
"Absolute Rate" means, with respect to a Loan made by a given Lender for
the relevant Absolute Rate Interest Period, the rate of interest per annum
(rounded to the nearest 1/100 of 1%) offered by such Lender and accepted by the
Borrower pursuant to Section 2.4.6.
"Absolute Rate Advance" means a borrowing hereunder consisting of the
aggregate amount of the several Absolute Rate Loans made by some or all of the
Lenders to the Borrower at the same time and for the same Absolute Rate Interest
Period.
"Absolute Rate Auction" means a solicitation of Competitive Bid Quotes
setting forth Absolute Rates pursuant to Section 2.4.
"Absolute Rate Interest Period" means, with respect to an Absolute Rate
Advance or an Absolute Rate Loan, a period of not less than 7 and not more than
180 days commencing on a Business Day selected by the Borrower pursuant to this
Agreement, but in no event extending beyond the Termination Date. If such
Absolute Rate Interest Period would end on a day which is not a Business Day,
such Absolute Rate Interest Period shall end on the next succeeding Business
Day.
"Absolute Rate Loan" means a Loan, denominated in Dollars, which bears
interest at an Absolute Rate.
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of any
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the outstanding
ownership interests of any partnership, association, joint venture or similar
business organization.
"Adjustment Date" is defined in Section 2.3.4.
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"Advance" means a borrowing hereunder consisting of the aggregate amount of
the several Loans made by some or all of the Lenders to the Borrower of the same
Type (or on the same interest basis in the case of Competitive Bid Advances)
and, in the case of Eurocurrency Advances, denominated in the same Eurocurrency
and, in the case of Fixed Rate Advances, for the same Interest Period and
includes both a Committed Advance and a Competitive Bid Advance.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means The First National Bank of Chicago in its capacity as agent
for the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means $150,000,000 as it may be increased from time
to time pursuant to Section 2.17 and as it may be reduced from time to time
pursuant to the other terms hereof.
"Agreement" means this credit agreement, as it may be amended or modified
and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the sum
of Federal Funds Effective Rate for such day plus 1/2% per annum.
"Alternate Base Rate Advance" means an Advance, denominated in Dollars,
which bears interest at the Alternate Base Rate.
"Alternate Base Rate Loan" means a Loan, denominated in Dollars, which
bears interest at the Alternate Base Rate.
"Applicable Margin" means, at any date of determination thereof with
respect to any Eurocurrency Committed Advance and the facility fees payable
pursuant to Section 2.6.1, the respective rates per annum for such Eurocurrency
Committed Advance and facility fees calculated in accordance with the terms of
Section 2.3.4.
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"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the Chief Financial Officer, Treasurer or
Assistant Treasurer of the Borrower, acting singly.
"Borrower" means Jostens, Inc., a Minnesota corporation, and its successors
and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurocurrency Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities and on which dealings
in the relevant Eurocurrency are carried on in the London interbank market and
(ii) for all other purposes, a day (other than a Saturday or Sunday) on which
banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934) of 35% or more of the outstanding shares of voting stock of the
Borrower.
"Closing Date" means the date upon which all of the conditions set forth in
Section 4.1 have been satisfied or waived.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commercial Paper Rating" is defined in Section 2.3.4.
"Commitment" means, for each Lender, the obligation of such Lender to make
Loans not exceeding the amount set forth (i) opposite its signature below, (ii)
as set forth in any Notice of Assignment relating to any assignment that has
become effective pursuant to Section 12.3.2, or (iii) as set forth in any
Commitment
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Increase Letter that has become effective pursuant to Section 2.17, in each case
as such amount may be modified from time to time pursuant to the terms hereof.
"Commitment Increase Date" is defined in Section 2.17.
"Commitment Increase Letter" is defined in Section 2.17.
"Committed Advance" means a borrowing hereunder consisting of the aggregate
amount of the several Committed Loans made by the Lenders to the Borrower at the
same time, of the same Type and, in the case of Eurocurrency Committed Advances,
denominated in the same Eurocurrency and for the same Interest Period.
"Committed Borrowing Notice" is defined in Section 2.3.5.
"Committed Loan" means a Loan made by a Lender pursuant to Section 2.3.
"Committed Note" means a promissory note in substantially the form of
Exhibit "A-1" hereto, with appropriate insertions, duly executed and delivered
to the Agent by the Borrower for the account of a Lender and payable to the
order of such Lender in the amount of its Commitment, including any amendment,
modification, renewal or replacement of such promissory note.
"Competitive Bid Acceptance Notice" is defined in Section 2.4.6.
"Competitive Bid Advance" means a Eurocurrency Bid Rate Advance or an
Absolute Rate Advance.
"Competitive Bid Auction" means an Absolute Rate Auction or a Eurocurrency
Auction.
"Competitive Bid Loan" means a Eurocurrency Bid Rate Loan or an Absolute
Rate Loan.
"Competitive Bid Margin" means the margin above or below the applicable
Eurocurrency Base Rate offered for a Eurocurrency Bid Rate Loan, expressed as a
percentage (rounded to the nearest 1/100 of 1%) to be added or subtracted from
such Eurocurrency Base Rate.
"Competitive Bid Note" means a promissory note in substantially the form of
Exhibit "A-2" hereto, with appropriate insertions, duly executed and delivered
to the Agent by the Borrower for the account of a Lender and payable to the
order of such Lender, including any amendment, modification, renewal or
replacement of such promissory note.
"Competitive Bid Quote" means a Competitive Bid Quote substantially in the
form of Exhibit "D" hereto completed and
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delivered by a Lender to the Agent in accordance with Section 2.4.4.
"Competitive Bid Quote Request" means a Competitive Bid Quote Request
substantially in the form of Exhibit "B" hereto completed and delivered by the
Borrower to the Agent in accordance with Section 2.4.2.
"Condemnation" is defined in Section 7.8.
"Consolidated Assets" means the total assets of the Borrower and its
Subsidiaries, as determined on a consolidated basis in accordance with Agreement
Accounting Principles consistently applied.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or application for a Letter of Credit.
"Controlled Group" means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.3.6.
"Corporate Base Rate" means a rate per annum equal to the corporate base
rate of interest announced by First Chicago from time to time, changing when and
as said corporate base rate changes.
"Default" means an event described in Article VII.
"Dollar" or "$" means United States Dollars.
"Dollar Equivalent" of (i) any Loan denominated in Dollars means the amount
of such Loan, and (ii) any Foreign Currency Loan means the Dollar equivalent of
the amount of such Foreign Currency Loan, calculated on the basis of the
arithmetical mean of the buy and sell spot rates of exchange of the Agent for
such Foreign Currency on the London market at 11:00 a.m. London time, two
Business Days prior to the date on which such amount is to be determined.
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"Entitled Person" is defined in Section 2.10.2.
"ERISA" means the Employee Retirement Income Security Act of l974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurocurrency" means, subject to Section 3.8, (i) Dollars, and (ii) any
other currency (a) which is freely transferable and convertible into Dollars,
(b) in which deposits are customarily offered to banks in the London interbank
market, (c) which the Borrower requests the Agent to include as a Eurocurrency
hereunder and (d) which is reasonably available to each Lender.
"Eurocurrency Advance" means a Eurocurrency Committed Advance or a
Eurocurrency Bid Rate Advance, as applicable.
"Eurocurrency Auction" means a solicitation of Competitive Bid Quotes
setting forth Competitive Bid Margins pursuant to Section 2.4.
"Eurocurrency Base Rate" means with respect to any Eurocurrency Advance for
the relevant Eurocurrency Interest Period, the rate determined by the Agent to
be the rate at which deposits in the applicable Eurocurrency are offered by
First Chicago to first-class banks in the London interbank market at
approximately 11 a.m. (London time) two Business Days prior to the first day of
such Eurocurrency Interest Period, in the approximate amount of First Chicago's
relevant Eurocurrency Loan, or, in the case of a Eurocurrency Bid Rate Advance,
the amount of the Eurocurrency Bid Rate Advance requested by the Borrower, and
having a maturity approximately equal to such Eurocurrency Interest Period.
"Eurocurrency Bid Rate" means, with respect to a Loan made by a given
Lender for the relevant Eurocurrency Interest Period, the sum of (i) the
Eurocurrency Base Rate and (ii) the Competitive Bid Margin offered by such
Lender and accepted by the Borrower pursuant to Section 2.4.6.
"Eurocurrency Bid Rate Advance" means a borrowing hereunder consisting of
the aggregate amount of the several Eurocurrency Bid Rate Loans made by some or
all of the Lenders to the Borrower at the same time and for the same
Eurocurrency Interest Period, including, but not limited to, a Eurodollar Bid
Rate Advance.
"Eurocurrency Bid Rate Loan" means a Competitive Bid Loan, denominated in a
Eurocurrency, which bears interest at a Eurocurrency Bid Rate.
"Eurocurrency Committed Advance" means a Committed Advance, requested by
the Borrower pursuant to Section 2.3, which bears interest at a Eurocurrency
Rate, including, but not limited to, a Eurodollar Committed Advance.
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"Eurocurrency Committed Loan" means a Committed Loan, requested by the
Borrower pursuant to Section 2.3, which bears interest at a Eurocurrency Rate,
including but not limited to, a Eurodollar Committed Loan.
"Eurocurrency Interest Period" means, with respect to a Eurocurrency
Advance, a period of one, two, three or six months commencing on a Business Day
selected by the Borrower pursuant to this Agreement. Such Eurocurrency Interest
Period shall end on (but exclude) the day which corresponds numerically to such
date one, two, three or six months thereafter; provided, however, that if there
is no such numerically corresponding day in such next, second, third or sixth
succeeding month, such Eurocurrency Interest Period shall end on the last
Business Day of such next, second, third or sixth succeeding month. If a
Eurocurrency Interest Period would otherwise end on a day which is not a
Business Day, such Eurocurrency Interest Period shall end on the next succeeding
Business Day; provided, however, that if said next succeeding Business Day falls
in a new calendar month, such Eurocurrency Interest Period shall end on the
immediately preceding Business Day.
"Eurocurrency Loan" means a Eurocurrency Committed Loan or a Eurocurrency
Bid Rate Loan, as applicable.
"Eurocurrency Rate" means, with respect to a Eurocurrency Committed Advance
for the relevant Eurocurrency Interest Period, the sum of (i) the percentage
indicated as the Applicable Margin for Eurocurrency Committed Advances plus (ii)
the quotient of (a) the Eurocurrency Base Rate applicable to such Eurocurrency
Interest Period, divided by (b) either (1) for any Eurodollar Committed Advance,
a number equal to one minus the Reserve Requirement (expressed as a decimal)
applicable to such Eurocurrency Interest Period or (2) for any other
Eurocurrency Committed Advance, the number one. The Eurocurrency Rate shall be
rounded to the next higher multiple of 1/16 of 1% if the rate is not such a
multiple.
"Eurodollar Advance" means a Eurodollar Committed Advance or a Eurodollar
Bid Rate Advance.
"Eurodollar Bid Rate Advance" means a borrowing hereunder consisting of the
aggregate amount of the several Eurodollar Bid Rate Loans made by some or all of
the Lenders to the Borrower at the same time and for the same Eurocurrency
Interest Period.
"Eurodollar Bid Rate Loan" means a Competitive Bid Loan, denominated in
Dollars, which bears interest at a Eurocurrency Bid Rate.
"Eurodollar Committed Advance" means a Committed Advance, denominated in
Dollars, which bears interest at the Eurocurrency Rate.
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"Eurodollar Committed Loan" means a Committed Loan, denominated in Dollars,
which bears interest at the Eurocurrency Rate.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"First Chicago" means The First National Bank of Chicago in its individual
capacity, and its successors.
"Fixed Rate" means the Eurocurrency Rate, the Eurocurrency Bid Rate or the
Absolute Rate.
"Fixed Rate Advance" means an Advance which bears interest at a Fixed Rate.
"Fixed Rate Loan" means a Loan which bears interest at a Fixed Rate.
"Foreign Currency" means any Eurocurrency other than Dollars.
"Foreign Currency Advance" means any Advance in a Foreign Currency.
"Foreign Currency Loan" means any Loan in a Foreign Currency.
"Governmental Agency" means any government, foreign or domestic, or any
state, department or other political subdivision thereof, or governmental body,
agency, authority, department or commission (including without limitation any
taxing authority or political subdivision) or instrumentality (including without
limitation any court or tribunal) exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any
corporation, partnership or other entity, directly or indirectly owned by or
subject to the control of any of the foregoing.
"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
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production from Property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or other instruments, (v)
Capitalized Lease Obligations, (vi) net liabilities with respect to Rate Hedging
Obligations, (vii) Contingent Obligations (without duplication when determining
the Indebtedness of the Borrower and its Subsidiaries in the aggregate), and
(viii) obligations for which such Person is obligated pursuant to a Letter of
Credit.
"Interest Coverage Ratio" means, for any period of determination, the ratio
of (i) earnings before Interest Expense and taxes, to (ii) Interest Expense, all
as determined for the Borrower and its Subsidiaries on a consolidated basis in
accordance with Agreement Accounting Principles consistently applied.
"Interest Expense" means, for any period of determination, total interest
expense, whether paid in cash or accrued as a liability, during such period
(including imputed interest on Capitalized Lease Obligations), net of cash
interest income, all as determined for the Borrower and its Subsidiaries on a
consolidated basis in accordance with Agreement Accounting Principles
consistently applied.
"Interest Period" means a Eurocurrency Interest Period or an Absolute Rate
Interest Period.
"Investment" of a Person means any loan, advance, extension of credit
(other than accounts receivable arising in the ordinary course of business on
terms customary in the trade), deposit account or contribution of capital by
such Person to any other Person or any investment in, or purchase or other
acquisition of, the stock, partnership interests, notes, debentures or other
securities of any other Person made by such Person.
"Investment Guidelines" means the guidelines for investment of funds of the
Borrower and its Subsidiaries, as reviewed by the Board of Directors of the
Borrower or an authorized executive committee thereof and as in effect on the
Closing Date, a copy of which has been furnished to the Lenders, as modified
from time to time and reviewed by the Board of Directors of the Borrower or an
authorized executive committee thereof.
"Invitation for Competitive Bid Quotes" means an Invitation for Competitive
Bid Quotes substantially in the form of Exhibit "C" hereto, completed and
delivered by the Agent to the Lenders in accordance with Section 2.4.3.
"Judgment Currency" is defined in Section 2.10.2.
"Lender Affiliate" means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if
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the controlling Person owns 51% or more of any class of voting securities (or
other ownership interests) of the controlled Person or possesses, directly or
indirectly, the power to direct or cause the direction of the management or
policies of the controlled Person, whether through ownership of stock, by
contract or otherwise.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and that become a party to this Agreement pursuant to Section
2.17, and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, any
office, branch, subsidiary or affiliate of such Lender or the Agent.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Level" is defined in Section 2.3.4.
"Level A" is defined in Section 2.3.4.
"Level B" is defined in Section 2.3.4.
"Level C" is defined in Section 2.3.4.
"Level I" is defined in Section 2.3.4.
"Level II" is defined in Section 2.3.4.
"Level III" is defined in Section 2.3.4.
"Level IV" is defined in Section 2.3.4.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's portion of any
Advance.
"Loan Documents" means this Agreement and the Notes.
"Long Term Debt Rating" is defined in Section 2.3.4.
Page 10
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its material obligations under the Loan
Documents, or (iii) the validity or enforceability of any of the Loan Documents
or the rights or remedies of the Agent or the Lenders thereunder.
"Moody's" means Xxxxx'x Investors Service Inc. or any successor corporation
thereto.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Net Worth" means, for any period of determination, stockholders' equity,
as determined for the Borrower and its Subsidiaries on a consolidated basis in
accordance with Agreement Accounting Principles consistently applied.
"Notes" means, collectively, the Committed Notes and the Competitive Bid
Notes; and "Note" means any one of such Notes.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Notes, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders or to any
Lender, the Agent or any indemnified party arising under the Loan Documents.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each March, June, September and
December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust or other entity or organization, or
any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
Page 11
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Rate Hedging Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all
agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, dollar-denominated or cross-
currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts and warrants, and (ii) any and all
cancellations, buy backs, reversals, terminations or assignments of any of the
foregoing.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 66 2/3%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 66 2/3% of the aggregate unpaid
principal amount of the outstanding Advances.
Page 12
"Reserve Requirement" means, with respect to a Eurocurrency Interest
Period, the maximum aggregate reserve requirement (including all basic,
supplemental, marginal and other reserves) which is imposed under Regulation D
on Eurocurrency liabilities.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Specified Currency" is defined in Section 2.10.2.
"Specified Place" is defined in Section 2.10.2.
"Standard & Poor's" means Standard & Poor's Ratings Services or any
successor thereto.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean a
Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 20% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made, or (ii) is responsible for more than 20% of the
consolidated net sales or of the consolidated net income (excluding all
nonrecurring or extraordinary gains and losses) of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause (i)
above.
"Termination Date" means the earlier of (i) December 20, 2000, and (ii) the
date on which the Commitments shall have been reduced to zero or terminated
pursuant to Section 2.7.1 or 8.1.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance or Loan, its nature as an
Alternate Base Rate Advance or Loan, Eurocurrency Committed Advance or Loan,
Eurocurrency Bid Rate Advance or Loan or Absolute Rate Advance or Loan.
Page 13
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested nonforfeitable benefits under all Single Employer Plans exceeds
the fair market value of all such Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans. Such
Unfunded Liabilities shall be determined based upon the actuarial assumptions
used to determine vested nonforfeitable benefits for purposes of preparing the
Borrower's annual audited financial statements delivered to the Agent pursuant
to Section 6.1(i) hereof.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which (other than directors' qualifying shares)
shall at the time be owned or controlled, directly or indirectly, by such Person
or one or more Wholly-Owned Subsidiaries of such Person, or by such Person and
one or more Wholly-Owned Subsidiaries of such Person, or (ii) any partnership,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
ARTICLE II
THE CREDITS
-----------
2.1. Description of Facility. Upon the terms and subject to the conditions
-----------------------
set forth in this Agreement, the Lenders hereby grant to the Borrower a
revolving credit facility pursuant to which: (i) each Lender severally agrees to
make Committed Loans to the Borrower in accordance with Section 2.3; and (ii)
each Lender may, in its sole discretion, make bids to make Competitive Bid Loans
to the Borrower in accordance with Section 2.4; provided, however, that in no
event may the aggregate principal amount of all outstanding Advances (including
both Committed Advances and Competitive Bid Advances) exceed the Aggregate
Commitment.
2.2. Availability of Facility. Subject to all of the terms and conditions
------------------------
of this Agreement, the facility is available from the Closing Date to the
Termination Date, and the Borrower may borrow, repay and reborrow at any time
prior to the Termination Date.
Page 14
2.3. Committed Advances.
-------------------
2.3.1. Commitment. From and including the Closing Date and prior to
----------
the Termination Date, each Lender severally agrees, on the terms and conditions
set forth in this Agreement, to make Committed Loans to the Borrower from time
to time in amounts having a Dollar Equivalent not to exceed in the aggregate at
any one time outstanding the amount of its Commitment; provided, however, that,
subject to Section 2.17, the Foreign Currency Loans shall not exceed a Dollar
Equivalent of $25,000,000 in the aggregate at any one time outstanding. The
Commitments to lend hereunder shall expire on the Termination Date.
2.3.2. Ratable Loans; Types of Advances. Each Committed Advance
--------------------------------
hereunder shall consist of Loans made from the several Lenders ratably in
proportion to the ratio that their respective Commitments bear to the Aggregate
Commitment. The Committed Advances may be Alternate Base Rate Advances or
Eurocurrency Committed Advances, or a combination thereof, selected by the
Borrower in accordance with Sections 2.3.5 and 2.3.6; provided, however, that
(i) Eurocurrency Committed Advances denominated in a Foreign Currency may be
outstanding in not more than five Foreign Currencies at any one time and (ii)
there shall not be more than twelve Eurocurrency Committed Advances denominated
in a Foreign Currency outstanding at any one time. The Committed Advances shall
be evidenced by the Committed Notes.
2.3.3. Minimum Amount of Each Committed Advance. Each Eurocurrency
----------------------------------------
Committed Advance shall be in a minimum amount, having a Dollar Equivalent, of
not less than $5,000,000 (and in multiples of $1,000,000 if in excess thereof),
and each Alternate Base Rate Advance shall be in a minimum amount of $500,000
(and in multiples of $100,000 if in excess thereof); provided, however, that any
Alternate Base Rate Advance may be in the amount of the unused Aggregate
Commitment.
2.3.4. Applicable Margin
-----------------
(a) Long Term Debt Rating.
---------------------
(i) So long as the Borrower has a Long Term Debt Rating, the
Applicable Margin for Eurocurrency Committed Advances and for facility fees
payable pursuant to Section 2.6.1 hereunder, shall be subject to adjustment
(upwards or downwards, as appropriate) based on the applicable Level and
shall be determined in accordance with the table set forth below in this
subsection (a)(i). The Level shall be based on the applicable Long Term
Debt Rating. The Applicable Margin shall be adjusted on the earlier of the
date of announcement or the date of publication by the respective rating
agencies of a change in the Long Term Debt Rating or, in the absence of
such announcement or publication, on the effective date of such
Page 15
changed Long Term Debt Rating (the "Adjustment Date"), and shall apply to
all outstanding Eurocurrency Committed Advances and the facility fees from
and after such Adjustment Date to the next Adjustment Date. In the event
that the Borrower shall at any time cease to have a Long Term Debt Rating
or a Commercial Paper Rating, Level IV shall apply.
Applicable Margin
(basis points per annum)
------------------------
Eurocurrency Committed
Rating Advances Facility Fees
------ -------- -------------
Level I 12.5 b.p. 7.5 b.p.
Level II 17.0 b.p. 8.0 b.p.
Level III 20.0 b.p. 10.0 b.p
Level IV 25.0 b.p 15.0 b.p.
(ii) For purposes of Section 2.3.4(a) of this Agreement, the
applicable Level shall be determined in accordance with the following
definitions:
"Level I" means the level applicable at any time when the Borrower's
Long Term Debt Rating is at least A+ or better from Standard & Poor's or at
least A1 or better from Moody's.
--
"Level II" means the level applicable at any time when Level I is not
applicable, and the Borrower's Long Term Debt Rating is at least A- or
better from Standard & Poor's or at least A3 or better from Moody's.
--
"Level III" means the level applicable at any time when the Borrower's
Long Term Debt Rating is BBB+ from Standard & Poor's or Baa1 from Moody's.
--
"Level IV" means the level applicable at any time when the Borrower's
Long Term Debt Rating is BBB or below from Standard & Poor's or Baa2 or
--
below from Moody's.
"Long Term Debt Rating" means the then most recent rating assigned by
Standard & Poor's or Moody's to the Borrower's senior unsecured long term
debt; provided, however, that if (i) such rating is received from one such
rating agency, then that rating will be the Long Term Debt Rating, (ii)
such rating is received from both rating agencies, then the higher rating
will be the Long Term Debt Rating, and (iii) if there is a difference of
two or more Levels between such ratings, then the rating which is one below
the higher rating will be the Long Term Debt Rating.
Page 16
(b) Commercial Paper Rating.
-----------------------
(i) If the Borrower ceases, at any time, to have a Long Term Debt
Rating, the Applicable Margin for Eurocurrency Committed
Advances and for facility fees payable pursuant to Section
2.6.1 hereunder, shall be subject to adjustment (upwards or
downwards, as appropriate) based on the applicable Level and
shall be determined in accordance with the table set forth
below in this subsection (b)(i). The Level shall be based on
the applicable Commercial Paper Rating. The Applicable Margin
shall be adjusted on the earlier of the date of announcement or
the date of publication by the respective rating agencies of a
change in the Commercial Paper Rating or, in the absence of
such announcement or publication, on the effective date of such
changed Commercial Paper Rating (the "Adjustment Date"), and
shall apply to all outstanding Eurocurrency Committed Advances
and the facility fees from and after such Adjustment Date to
the next Adjustment Date.
Applicable Margin
(basis points per annum)
------------------------
Eurocurrency Committed
Rating Advances Facility Fees
------ -------- -------------
Level A 12.5 b.p. 7.5 b.p.
Level B 20.0 b.p. 10.0 b.p.
Level C 25.0 b.p. 15.0 b.p
(ii) For purposes of Section 2.3.4(b) of this Agreement, the
applicable Level shall be determined in accordance with the following
definitions:
"Commercial Paper Rating" means the then most recent rating assigned
by Standard & Poor's or Moody's to the Borrower's commercial paper.
"Level A" means the level applicable at any time when the Borrower's
Commercial Paper Rating is at least A1 or better from Standard & Poor's or
--
at least P1 from Moody's.
"Level B" means the level applicable at any time when the Borrower's
Commercial Paper Rating is A2 from Standard & Poor's and P2 from Moody's.
---
"Level C" means the level applicable at any time when Level B does
not apply and the Borrower's Commercial Paper Rating is A2 or below from
Standard & Poor's or P2 or below from Moody's.
--
2.3.5. Method of Selecting Types and Interest Periods for New Committed
----------------------------------------------------------------
Advances. The Borrower shall select the Type of
--------
Page 17
Committed Advance and, in the case of each Eurocurrency Committed Advance,
the Eurocurrency and the Eurocurrency Interest Period applicable thereto,
for each such Committed Advance. The Borrower shall give the Agent
irrevocable notice (a "Committed Borrowing Notice") not later than 11:00
a.m. (Chicago time) on the Borrowing Date of each Alternate Base Rate
Advance and not later than 10:00 a.m. (Chicago time) at least three
Business Days before the Borrowing Date for each Eurocurrency Committed
Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Committed Advance,
(ii) the aggregate amount of such Committed Advance,
(iii) the Type of Committed Advance selected,
(iv) in the case of each Eurocurrency Committed Advance, the
Eurocurrency applicable thereto, and
(v) in the case of each Eurocurrency Committed Advance, the Interest
Period applicable thereto.
2.3.6. Conversion and Continuation of Outstanding Advances.
---------------------------------------------------
(a) Dollar Advances. Alternate Base Rate Advances shall continue
---------------
as Alternate Base Rate Advances unless and until such Alternate Base Rate
Advances are converted into Eurodollar Committed Advances. Each Eurodollar
Committed Advance shall continue as a Eurodollar Committed Advance until the end
of the then applicable Interest Period therefor, at which time such Eurodollar
Committed Advance shall be automatically converted into an Alternate Base Rate
Advance unless repaid or unless the Borrower shall have given the Agent a
Conversion/Continuation Notice in accordance with Section 2.3.6(c) requesting
that, at the end of such Interest Period, such Eurodollar Committed Advance
continue as a Eurodollar Committed Advance for the same or another Interest
Period. Subject to the terms of Section 2.3.3, the Borrower may elect from time
to time to convert all or any part of an Alternate Base Rate Advance into a
Eurodollar Committed Advance.
(b) Foreign Currency Advances. Each Foreign Currency Advance shall
-------------------------
continue as such until the end of the then applicable Interest Period therefor,
at which time such Foreign Currency Advance shall automatically be deemed to be
continued as a Foreign Currency Advance in the same amount and the same Foreign
Currency with a Eurocurrency Interest Period of one month (commencing on the
last day of the expiring Interest Period), unless repaid or unless the Borrower
shall have given the Agent a Conversion/Continuation Notice in accordance with
Section 2.3.6(c) requesting that, at the end of such Interest Period, such
Foreign Currency Advance continue
Page 18
as a Foreign Currency Advance in the same Foreign Currency for the same or
another Eurocurrency Interest Period.
(c) General Provisions. The Borrower shall give the Agent irrevocable
------------------
notice (a "Conversion/Continuation Notice") of each conversion of an Alternate
Base Rate Advance to a Eurocurrency Committed Advance or continuation of a
Eurocurrency Committed Advance (as permitted by the provisions of Sections
2.3.6(a) and (b)) not later than 10:00 a.m. (Chicago time) at least three
Business Days prior to the date of the requested conversion or continuation,
specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount, Eurocurrency and Type of the Committed
Advance which is to be converted or continued; and
(iii) the amount and Type(s) of Committed Advance(s) into which such
Committed Advance is to be converted or continued and, in the
case of a conversion into or continuation of a Eurocurrency
Committed Advance, the duration of the Interest Period applicable
thereto.
Notwithstanding the provisions of Sections 2.3.6(a) and (b), no Eurocurrency
Committed Advance shall be continued as or converted into a Eurocurrency
Committed Advance for a new Interest Period if the Dollar Equivalent of the
aggregate principal amount of Advances to be outstanding after giving effect to
such continuation or conversion would exceed 102% of the Aggregate Commitment.
2.4. Competitive Bid Advances.
------------------------
2.4.1. Competitive Bid Option; Repayment of Competitive Bid Advances.
-------------------------------------------------------------
In addition to Committed Advances pursuant to Section 2.3, but subject to all of
the terms and conditions of this Agreement (including, without limitation, the
limitation set forth in Section 2.1 as to the maximum aggregate principal amount
of all outstanding Advances hereunder), the Borrower may, as set forth in this
Section 2.4, request the Lenders, prior to the Termination Date, to make offers
to make Competitive Bid Advances to the Borrower. Each Lender may, but shall
have no obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this Section
2.4. The Competitive Bid Advances shall be evidenced by the Competitive Bid
Notes. Each Competitive Bid Advance shall be repaid in full by the Borrower on
the last day of the Interest Period applicable thereto.
2.4.2. Competitive Bid Quote Request. When the Borrower wishes to
-----------------------------
request offers to make Competitive Bid Loans
Page 19
under this Section 2.4, the Borrower shall transmit to the Agent by telecopy a
Competitive Bid Quote Request so as to be received no later than (x) 10:00 a.m.
(Chicago time) at least five Business Days prior to the Borrowing Date proposed
therein, in the case of a Eurocurrency Auction, or (y) 10:00 a.m. (Chicago time)
at least one Business Day prior to the Borrowing Date proposed therein, in the
case of an Absolute Rate Auction, specifying in accordance with all of the terms
of this Agreement:
(i) the proposed Borrowing Date, which shall be a Business Day, for the
proposed Competitive Bid Advance;
(ii) the aggregate principal amount of such Competitive Bid Advance;
(iii) whether the Competitive Bid Quotes requested are to set forth a
Competitive Bid Margin or an Absolute Rate, or both;
(iv) in the case of each Eurocurrency Bid Rate Advance, the Eurocurrency
applicable thereto; and
(v) the Interest Period applicable thereto.
The Borrower may request offers to make Competitive Bid Loans for more than one
Interest Period and for a Eurocurrency Auction and an Absolute Rate Auction in a
single Competitive Bid Quote Request. No Competitive Bid Quote Request shall be
given within five Business Days (or upon reasonable prior notice to the Lenders,
such other number of days as the Borrower and the Agent may agree) of any other
Competitive Bid Quote Request. Each Competitive Bid Quote Request shall be in a
minimum amount of $5,000,000 (and in multiples of $1,000,000 in excess thereof).
A Competitive Bid Quote Request that does not conform substantially to the
format of Exhibit "B" hereto shall be rejected, and the Agent shall promptly
notify the Borrower of such rejection by telecopy and telephone.
2.4.3. Invitation for Competitive Bid Quotes. Promptly upon
-------------------------------------
receipt of a Competitive Bid Quote Request that is not rejected pursuant to
Section 2.4.2, the Agent shall send to each of the Lenders by telecopy an
Invitation for Competitive Bid Quotes which shall constitute an invitation by
the Borrower to each Lender to submit Competitive Bid Quotes offering to make
the Competitive Bid Loans to which such Competitive Bid Quote Request relates in
accordance with this Section 2.4.
2.4.4. Submission and Contents of Competitive Bid Quotes.
-------------------------------------------------
(a) Each Lender may, in its sole discretion, submit a Competitive Bid
Quote containing an offer or offers to make Competitive Bid Loans in
response to any Invitation
Page 20
for Competitive Bid Quotes. Each Competitive Bid Quote must comply
with the requirements of this Section 2.4.4 and must be submitted to
the Agent by telecopy at its offices specified in or pursuant to
Article XIII not later than (i) (A) 12:45 p.m. (Chicago time) in the
case of First Chicago and (B) 1:00 p.m. (Chicago time) in the case of
each other Lender, at least four Business Days prior to the proposed
Borrowing Date in the case of a Eurocurrency Auction, or (ii) (A) 8:45
a.m. (Chicago time) in the case of First Chicago and (B) 9:00 a.m.
(Chicago time) in the case of each other Lender, on the proposed
Borrowing Date in the case of an Absolute Rate Auction (or, in either
such case upon reasonable prior notice to the Lenders, such other time
and date as the Borrower and the Agent may agree; provided that First
Chicago shall always be required to submit its Competitive Bid Quotes
not less than fifteen minutes prior to the other Lenders). Subject to
Articles IV and VIII, any Competitive Bid Quote so made shall be
irrevocable except with the written consent of the Agent given on the
instructions of the Borrower.
(b) Each Competitive Bid Quote shall in any case specify:
(i) the proposed Borrowing Date, which shall be the same as
that set forth in the applicable Invitation for Competitive
Bid Quotes;
(ii) the principal amount of the Competitive Bid Loan for which
each such offer is being made, (1) which principal amount
may be greater than, less than or equal to the Commitment
of the quoting Lender, but in no case greater than the
unutilized Aggregate Commitment, (2) which principal amount
must be at least $5,000,000 (and in multiples of $1,000,000
in excess thereof) and (3) which principal amount may not
exceed the principal amount of Competitive Bid Loans for
which offers were requested;
(iii) in the case of a Eurocurrency Auction, the Competitive Bid
Margin offered for each such Competitive Bid Loan;
(iv) the minimum or maximum amount, if any, of the Competitive
Bid Loan which may be accepted by the Borrower and/or the
limit, if any, as to the aggregate principal amount of the
Competitive Bid Loans from such Lender which may be
accepted by the Borrower;
Page 21
(v) in the case of an Absolute Rate Auction, the Absolute
Rate offered for each such Competitive Bid Loan;
(vi) in the case of a Eurocurrency Auction, the Eurocurrency
applicable thereto, which shall be the same as that set
forth in the applicable Invitation for Competitive Bid
Quotes;
(vii) the applicable Interest Period, which shall be the same
as that set forth in the applicable Invitation for
Competitive Bid Quotes; and
(viii) the identity of the quoting Lender.
(c) The Agent shall reject any Competitive Bid Quote that:
(i) is not substantially in the form of Exhibit "D" hereto or
does not specify all of the information required by
Section 2.4.4(b);
(ii) contains qualifying, conditional or similar language,
other than any such language contained in Exhibit "D"
hereto;
(iii) proposes terms other than or in addition to those set
forth in the applicable Invitation for Competitive Bid
Quotes; or
(iv) arrives after the time set forth in Section 2.4.4(a).
(d) If any Competitive Bid Quote shall be rejected pursuant to Section
2.4.4(c), then the Agent shall notify the relevant Lender of such
rejection as soon as practicable.
2.4.5. Notice to Borrower. The Agent shall promptly notify the
------------------
Borrower of the terms (i) of any Competitive Bid Quote submitted by a Lender
that is in accordance with Section 2.4.4 and (ii) of any Competitive Bid Quote
that is in accordance with Section 2.4.4 and amends, modifies or is otherwise
inconsistent with a previous Competitive Bid Quote submitted by such Lender with
respect to the same Competitive Bid Quote Request. Any such subsequent
Competitive Bid Quote shall be disregarded by the Agent unless such subsequent
Competitive Bid Quote specifically states that it is submitted solely to correct
a manifest error in such former Competitive Bid Quote. The Agent's notice to
the Borrower shall specify the aggregate principal amount of Competitive Bid
Loans for which offers have been received for each Interest Period specified in
the related Competitive Bid Quote Request and the
Page 22
respective principal amounts and Competitive Bid Margins or Absolute Rates, as
the case may be, so offered.
2.4.6. Acceptance and Notice by Borrower. Subject to the receipt of
---------------------------------
the notice from the Agent referred to in Section 2.4.5, not later than (i) 10:00
a.m. (Chicago time) at least three Business Days prior to the proposed Borrowing
Date, in the case of a Eurocurrency Auction or (ii) 11:00 a.m. (Chicago time) on
the proposed Borrowing Date, in the case of an Absolute Rate Auction, the
Borrower shall notify the Agent of the Borrower's acceptance or rejection of the
offers so notified to it pursuant to Section 2.4.5; provided, however, that the
failure by the Borrower to give such notice to the Agent shall be deemed to be a
rejection by the Borrower of all such offers. In the case of acceptance, such
notice (a "Competitive Bid Acceptance Notice") shall specify the aggregate
principal amount of offers for each Interest Period that are accepted. The
Borrower may accept or reject any Competitive Bid Quote in whole or in part
(subject to the terms of Section 2.4.4(b)(iv)); provided that:
(i) the aggregate principal amount of each Competitive Bid Advance may
not exceed the applicable amount set forth in the related
Competitive Bid Quote Request;
(ii) acceptance of offers may only be made on the basis of ascending
Competitive Bid Margins or Absolute Rates, as the case may be; and
(iii) the Borrower may not accept any offer of the type described in
Section 2.4.4(c) or that otherwise fails to comply with the
requirements of this Agreement for the purpose of obtaining a
Competitive Bid Loan under this Agreement.
2.4.7. Allocation by the Agent. Subject to Section 2.4.6, if offers
-----------------------
are made by two or more Lenders with the same Competitive Bid Margins or
Absolute Rates, as the case may be, for a greater aggregate principal amount
than the amount in respect of which offers are permitted to be accepted for the
related Interest Period, the principal amount of Competitive Bid Loans in
respect of which such offers are accepted shall be allocated by the Agent among
such Lenders as nearly as possible (in such multiples as the Agent may deem
appropriate) in proportion to the aggregate principal amount of such offers;
provided, however, that no Lender shall be allocated a portion of any
Competitive Bid Advance which is less than the minimum amount which such Lender
has indicated that it is willing to accept. Allocations by the Agent of the
amounts of Competitive Bid Loans shall be conclusive in the absence of manifest
error. On the same Business Day as the Agent receives the Competitive Bid
Acceptance Notice from the Borrower pursuant to Section 2.4.6, the Agent shall
promptly, but in any event by 11:00 a.m. (Chicago time) on such day in the case
of Eurocurrency Bid
Page 23
Rate Advances, and by noon (Chicago time) on such day in the case of Absolute
Rate Advances, notify each Lender of its receipt of a Competitive Bid Acceptance
Notice and the aggregate principal amount of each Competitive Bid Advance
allocated to each participating Lender.
2.4.8. Administration Fee. The Borrower hereby agrees to pay to the
------------------
Agent, for its sole account, an administration fee of $1,000 per Competitive Bid
Quote Request transmitted by the Borrower to the Agent pursuant to Section
2.4.2. Such administration fee shall be payable in arrears on each Payment Date
and on the Termination Date (or such earlier date on which the Aggregate
Commitment shall terminate or be cancelled) for any period then ending for which
such fee, if any, shall not have been theretofore paid.
2.5. Method of Borrowing: Not later than 12:00 noon (Chicago time) on each
-------------------
Borrowing Date, each Lender shall make available its Loan or Loans, if any, in
funds immediately available to the Agent, in Chicago, Illinois at its address
specified pursuant to Article XIII. The Agent will make the funds so received
from the Lenders available to the Borrower at the Agent's aforesaid address.
Notwithstanding the foregoing provisions of this Section 2.5, to the extent that
a Loan made by a Lender matures on the Borrowing Date of a requested Loan in the
same Eurocurrency, such Lender shall apply the proceeds of the Loan it is then
making to the repayment of principal of the maturing Loan to such extent.
2.6. Fees. The Borrower agrees to pay the following fees:
----
2.6.1. Facility Fee. The Borrower agrees to pay to the Agent for
------------
the account of each Lender, for the period from the Closing Date to and
including the Termination Date, a facility fee equal to the product of (i) such
Lender's Commitment (whether used or unused), and (ii) the percentage specified
as the Applicable Margin for facility fees pursuant to Section 2.3.4, payable in
arrears on each Payment Date and on the Termination Date.
2.6.2. Agent's Fees. The Borrower agrees to pay to the Agent, for
------------
its own account, the fees agreed to by the Borrower and the Agent pursuant to
that certain Letter Agreement dated November 16, 1995.
2.7. Reductions in Aggregate Commitment; Principal Payments.
-------------------------------------------------------
2.7.1. Reductions in Aggregate Commitment. Subject to Section 2.17,
----------------------------------
the Borrower may permanently reduce the Aggregate Commitment in whole, or in
part ratably among the Lenders in a minimum aggregate amount of $5,000,000 (and
multiples of $1,000,000 in excess thereof), upon at least three Business Days'
written
Page 24
notice to the Agent, which notice shall specify the amount of any such
reduction; provided, however, that the amount of the Aggregate Commitment may
not be reduced below the Dollar Equivalent of the aggregate principal amount of
the then outstanding Advances.
2.7.2. Principal Payments.
------------------
(a) Optional Payments. The Borrower may from time to time pay,
-----------------
without penalty or premium, all outstanding Alternate Base Rate Advances, or, in
a minimum aggregate amount of $5,000,000 (and multiples of $1,000,000 in excess
thereof), any portion of the outstanding Alternate Base Rate Advances upon three
Business Days' prior notice to the Agent. Subject to Section 3.5, a Fixed Rate
Advance may be paid prior to the last day of the applicable Interest Period.
(b) Currency Fluctuations. If at any time the Agent shall
---------------------
determine that the Dollar Equivalent (and the Agent shall calculate the Dollar
Equivalent on each Borrowing Date and upon the request of any Lender) of the
aggregate principal amount of outstanding Advances is greater than 102% of the
Aggregate Commitment then in effect, the Borrower shall (i) promptly upon
receiving notice from the Agent on such Borrowing Date (and in any event on such
Borrowing Date), and (ii) at all other times, upon one (1) Business Day's
written notice to the Borrower from the Agent, prepay an aggregate principal
amount of Advances such that the Dollar Equivalent of the aggregate principal
amount of outstanding Advances does not exceed the Aggregate Commitment then in
effect.
(c) Termination. Any outstanding Advances and all other unpaid
-----------
Obligations shall be paid in full by the Borrower on the Termination Date.
2.8. Changes in Interest Rate, etc. Each Alternate Base Rate Advance
------------------------------
shall bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is converted from a
Eurodollar Committed Advance into an Alternate Base Rate Advance pursuant to
Section 2.3.6 to but excluding the date it becomes due or is converted into a
Eurodollar Committed Advance pursuant to Section 2.3.6 hereof, at a rate per
annum equal to the Alternate Base Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as an Alternate Base Rate
Advance will take effect simultaneously with each change in the Alternate Base
Rate. Each Fixed Rate Advance shall bear interest from and including the first
day of the Interest Period applicable thereto to (but not including) the last
day of such Interest Period at the interest rate determined as applicable to
such Fixed Rate Advance. No Interest Period may end after the Termination Date.
Page 25
2.9. Rates Applicable After Default. Notwithstanding anything to the
------------------------------
contrary contained in Section 2.3.5 or 2.3.6, during the continuance of a
Default or Unmatured Default, the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no
Advance may be made as, converted into or continued as a Fixed Rate Advance.
During the continuance of a Default, the Required Lenders may, at their option,
by notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that (i)
each Fixed Rate Advance shall bear interest for the remainder of the applicable
Interest Period at the rate otherwise applicable to such Interest Period plus 2%
per annum and (ii) each Alternate Base Rate Advance shall bear interest at a
rate per annum equal to the Alternate Base Rate plus 2% per annum.
2.10. Method of Payment
-----------------
2.10.1. General. Subject to the last sentence of Section 2.5, all
-------
payments of the Obligations hereunder shall be made, without setoff, deduction,
or counterclaim, in immediately available funds to the Agent at the Agent's
address specified pursuant to Article XIII, or at any other Lending Installation
of the Agent specified in writing by the Agent to the Borrower at least two (2)
Business Days prior to any such payment, by noon (local time) on the date when
due and shall be applied ratably by the Agent among all Lenders in the case of
fees and payments in respect of Committed Advances and ratably among the
applicable Lenders in respect of Competitive Bid Advances. Each payment
delivered to the Agent for the account of any Lender shall be delivered promptly
by the Agent to such Lender in the same type of funds that the Agent received at
its address specified pursuant to Article XIII or at any Lending Installation
specified in a notice received by the Agent from such Lender.
2.10.2. Currency of Payment. All payments of principal of and
-------------------
interest on any Advance or any other Obligations hereunder shall be made by the
Borrower in the currency borrowed (the "Specified Currency") in the manner and
at the address (the "Specified Place") specified in Section 2.10.1. Payment of
the Obligations shall not be discharged by an amount paid in another currency or
in another place, whether pursuant to a judgment or otherwise, to the extent
that the amount so paid on conversion to the Specified Currency and transfer to
the Specified Place under normal banking procedures does not yield the amount of
the Specified Currency at the Specified Place due hereunder. If, for the
purpose of obtaining judgment in any court, it is necessary to convert a sum due
hereunder in the Specified Currency into another currency (the "Judgment
Currency"), the rate of exchange which
Page 26
shall be applied shall be that at which in accordance with normal banking
procedures the Agent could purchase the Specified Currency with that amount of
the Judgment Currency on the Business Day next preceding that on which such
judgment is rendered. The obligation of the Borrower in respect of any such sum
due from it to the Agent or any Lender hereunder (an "Entitled Person") shall,
notwithstanding the rate of exchange actually applied in rendering such
judgment, be discharged only to the extent that on the Business Day following
receipt by such Entitled Person of any sum adjudged to be due hereunder or under
the Notes in the Judgment Currency, such Entitled Person may in accordance with
normal banking procedures purchase and transfer to the Specified Place the
Specified Currency with the amount of the Judgment Currency so adjudged to be
due; and the Borrower hereby, as a separate Obligation and notwithstanding any
such judgment, agrees to indemnify such Entitled Person against, and to pay such
Entitled Person on demand, in the Specified Currency, any difference between the
sum originally due to such Entitled Person in the Specified Currency and the
amount of the Specified Currency so purchased and transferred.
2.11. Notes; Telephonic Notices. Each Lender is hereby authorized to
-------------------------
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Notes; provided, however, that the failure to so record
shall not affect the Borrower's obligations under any Loan Document. The
Borrower hereby authorizes the Lenders and the Agent to extend, convert or
continue Advances, effect selections of Types of Advances, transfer funds and
submit Competitive Bid Quotes, in each case based on telephonic notices made by
any person or persons the Agent or any Lender in good faith believes to be
acting on behalf of the Borrower. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If
the written confirmation differs in any material respect from the action taken
by the Agent and the Lenders, the records of the Agent and the Lenders shall
govern absent manifest error.
2.12. Interest Payment Dates; Interest and Fee Basis. Interest accrued on
----------------------------------------------
each Alternate Base Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof, on any date
on which the Alternate Base Rate Advance is prepaid, whether due to acceleration
or otherwise, and at maturity. Interest accrued on each Fixed Rate Advance
shall be payable on the last day of its applicable Interest Period, on any date
on which the Fixed Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on each Fixed Rate Advance having
an Interest Period longer than three months or 90 days, as the case may be,
shall also be payable on the last day of each three-month interval (in the case
of Eurocurrency Committed Advances or Eurodollar Bid
Page 27
Rate Advances) or 90-day interval (in the case of Absolute Rate Advances) during
such Interest Period. Interest and fees shall be calculated for actual days
elapsed on the basis of a 360-day year. Interest shall be payable for the day
an Advance is made but not for the day of any payment on the amount paid if
payment is received prior to noon (local time) at the place of payment. If any
payment of principal of or interest on an Advance shall become due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time
shall be included in computing interest in connection with such payment.
2.13. Notification of Advances, Interest Rates, Prepayments and Commitment
--------------------------------------------------------------------
Reductions. Promptly after receipt thereof, the Agent will notify each Lender
----------
of the contents of each Aggregate Commitment reduction notice, Committed
Borrowing Notice, Competitive Bid Acceptance Notice, Conversion/Continuation
Notice, and repayment notice received by it hereunder. The Agent will notify
each Lender of the interest rate applicable to each Fixed Rate Advance promptly
upon determination of such interest rate and will give each Lender prompt notice
of each change in the Alternate Base Rate.
2.14. Lending Installations. Each Lender may book its Loans at any one or
---------------------
more Lending Installations selected by such Lender and may change such Lending
Installation or Lending Installations from time to time. All terms of this
Agreement shall apply to any such Lending Installation or Lending Installations
and the Notes shall be deemed held by each Lender for the benefit of such
Lending Installation or Lending Installations. Each Lender may, by written or
telex notice to the Agent and the Borrower, designate one or more Lending
Installations through which Loans will be made by it and for whose account Loan
payments are to be made.
2.15. Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender,
---------------------------------
as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent (or in the case of same day notice
Alternate Base Advances, at the time such Lender receives notice from the Agent
of a Committed Borrowing Notice requesting Alternate Base Rate Advances), of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Agent for the account
of the Lenders, that it does not intend to make such payment, the Agent may
assume that such payment has been made. The Agent may, but shall not be
obligated to, make the amount of such payment available to the intended
recipient in reliance upon such assumption. If such Lender or the Borrower, as
the case may be, has not in fact made such payment to the Agent, the recipient
of such payment shall, on demand by the Agent, repay to the Agent the amount so
made available together with interest thereon in respect of each day during the
period commencing on the date such amount was so made available by the Agent
until the date the Agent
Page 28
recovers such amount at a rate per annum equal to (i) in the case of payment by
a Lender, the Federal Funds Effective Rate for such day or (ii) in the case of
payment by the Borrower, the interest rate applicable to the relevant Loan.
2.16. Withholding Tax Exemption. At least five Business Days prior to the
-------------------------
first date on which interest or fees are payable hereunder for the account of
any Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, agrees that it will deliver to each of
the Borrower and the Agent two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224 (or a successor form), certifying in either
case that such Lender is entitled to receive payments under this Agreement and
the Notes without deduction or withholding of any United States federal income
taxes. Each Lender which so delivers a Form 1001 or 4224 further undertakes to
deliver to each of the Borrower and the Agent two additional copies of such form
(or a successor form) on or before the date that such form expires (currently,
three successive calendar years for Form 1001 and one calendar year for Form
4224) or becomes obsolete or after the occurrence of any event requiring a
change in the most recent forms so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Borrower
or the Agent, in each case certifying that such Lender is entitled to receive
payments under this Agreement and the Notes without deduction or withholding of
any United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form with respect to it and such Lender advises the
Borrower and the Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
2.17. Increases in Aggregate Commitment.
---------------------------------
(a) During the period from and after the Closing Date to the
Termination Date, the Borrower shall have the right to request that the
Aggregate Commitment be increased to an amount not to exceed $250,000,000;
provided, however, that (i) Foreign Currency Loans shall not exceed a Dollar
Equivalent at any one time outstanding equal to 20% of such increased Aggregate
Commitment, (ii) the Borrower may exercise such right not more than once every
six (6) months during such period, and (iii) the Borrower may reduce the
Aggregate Commitment pursuant to Section 2.7.1 hereof and then increase the
Aggregate Commitment pursuant to the terms of this Section 2.17 not more than
three (3) times during such period and thereafter any reductions in the
Aggregate Commitment shall be permanent. Any such increase of the Aggregate
Commitment shall be in a minimum amount of $25,000,000 (and multiples of
$5,000,000 if in excess thereof).
Page 29
(b) In the event of any such requested increase in the Aggregate
Commitment, (i) each of the Lenders shall be given the opportunity to
participate in the increased Aggregate Commitment (x) initially ratably in the
proportions that their respective Commitments bear to the Aggregate Commitment
and (y) to the extent that the requested increase of the Aggregate Commitment is
not fulfilled pursuant to the preceding clause (x), ratably in the proportion
that the respective Commitments of the Lenders desiring to participate in any
such increase bear to the total Commitments of the Lenders desiring to so
participate, and (ii) to the extent that the Lenders do not elect so to
participate in such increased Aggregate Commitment to the full extent thereof
after being afforded an opportunity to do so, then the Borrower shall consult
with the Agent as to the number, identity and requested Commitments of
additional financial institutions which the Borrower may invite to participate
in the Aggregate Commitment.
(c) No Lender shall at any time have any obligation to increase its
Commitment pursuant to a request by the Borrower under this Section 2.17.
(d) In no event shall any Lender's Commitment, immediately after
giving effect to any increase pursuant to this Section 2.17, exceed 33% of the
increased Aggregate Commitment.
(e) Any increase in the Aggregate Commitment pursuant to this
Section 2.17 shall be effective only upon the execution and delivery to the
Borrower and the Agent of a commitment increase letter in substantially the form
of Exhibit "I" hereto (a "Commitment Increase Letter"), which Commitment
Increase Letter shall be delivered to the Agent not less than five Business Days
prior to the date of any such increase and shall specify (i) the amount of the
Commitment of any other financial institution becoming a Lender party to this
Agreement or of any increase in the amount of the Commitment of any Lender
already party to this Agreement and (ii) the date such increase is to become
effective (the "Commitment Increase Date").
(f) In addition, any increase in the Aggregate Commitment pursuant
to this Section 2.17 shall not become effective unless:
(i) on the Commitment Increase Date, the Borrower's Long Term Debt
Rating from Standard & Poor's is at least A- or better or at least
A3 or better from Xxxxx'x;
(ii) no Default or Unmatured Default shall have occurred and be
continuing on the Commitment Increase Date;
(iii) each of the representations and warranties set forth in Article V of
this Agreement shall be true, correct and complete on the Commitment
Increase Date as if
Page 30
made on and as of such date, except as such representations and
warranties by their terms are made solely as of a prior date; and
(iv) the Borrower shall have furnished to the Agent (with sufficient
copies for each of the Lenders) a certificate of the Secretary or
Assistant Secretary of the Borrower as to the taking of any
corporate action necessary in connection with any such increase and
any other documents (including legal opinions and certificates) as
the Agent may reasonably request in connection with any such
increase.
ARTICLE III
CHANGE IN CIRCUMSTANCES
-----------------------
3.1. Taxes.
-----
3.1.1. Payments to be Free and Clear. Subject to compliance with Section
-----------------------------
2.16 by all Lenders required to do so, all sums payable by the Borrower whether
in respect of principal, interest, fees or any other Obligations shall be paid
without deduction for any present and future taxes, levies, imposts, deductions,
charges or withholdings imposed by any country, any Governmental Agency thereof
or therein, any jurisdiction from which any or all such payments are made and
any political subdivision or taxing authority thereof or therein (collectively,
"Taxes"), which amounts shall be paid by the Borrower as provided in Section
3.1.2(b). The Borrower will pay each Lender the amounts necessary such that the
net amount of the principal, interest, fees or other sums received and retained
by each Lender is not less than the amount payable under this Agreement.
3.1.2. Grossing-up of Payments. If: (a) the Borrower or any other Person
-----------------------
is required by law to make any deduction or withholding on account of any such
Tax or other amount from any sum paid or expressed to be payable by the Borrower
to any Lender under this Agreement (other than on account of tax on the overall
net income of any Lender); or (b) any party to this Agreement (or any Person on
its behalf) other than the Borrower is required by law to make any deduction or
withholding from, or (other than on account of tax on the overall net income of
that party) any payment on or calculated by reference to the amount of, any such
sum received or receivable by any Lender under this Agreement:
(i) the Borrower shall notify the Agent of any such requirement or any
change in any such requirement as soon as the Borrower becomes
aware of it;
Page 31
(ii) the Borrower shall pay any such Tax or other amount before the date
on which penalties attached thereto become due and payable, such
payment to be made (if the liability to pay is imposed on the
Borrower) for its own account or (if that liability is imposed on
any party to this Agreement) on behalf of and in the name of that
party;
(iii) the sum payable by the Borrower in respect of which the relevant
deduction, withholding or payment is required shall (except, in the
case of any such payment, to the extent that the amount thereof is
not ascertainable when that sum is paid) be increased to the extent
necessary to ensure that, after the making of that deduction,
withholding or payment, that party receives on the due date and
retains (free from any liability in respect of any such deduction,
withholding or payment) a sum equal to that which it would have
received and so retained had no such deduction, withholding or
payment been required or made; and
(iv) within thirty (30) days after payment of any sum from which the
Borrower is required by law to make any deduction or withholding,
and within thirty (30) days after the due date of payment of any Tax
or other amount which it is required by Section 3.1.2(b)(ii) to pay,
it shall deliver to the Agent all such certified documents and other
evidence as to the making of such deduction, withholding or payment
as (a) are reasonably satisfactory to other affected parties as
proof of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority and (b)
are reasonably required by any such party to enable it to claim a
tax credit with respect to such deduction, withholding or payment.
3.2. Yield Protection. If any law or any governmental or quasi-
----------------
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law), or any interpretation thereof, or the compliance of
any Lender therewith,
(i) subjects any Lender or any applicable Lending Installation to any
tax, duty, charge or withholding on or from payments due from the
Borrower (excluding federal taxation of the overall net income of
any Lender or applicable Lending Installation), or changes the basis
of taxation of payments to any Lender in respect of its Loans or
other amounts due it hereunder, or
Page 32
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against
assets of, deposits with or for the account of, or credit extended
by, any Lender or any applicable Lending Installation (other than
reserves and assessments taken into account in determining the
interest rate applicable to Fixed Rate Advances), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of making,
funding or maintaining loans or reduces any amount receivable by any
Lender or any applicable Lending Installation in connection with
loans, or requires any Lender or any applicable Lending Installation
to make any payment calculated by reference to the amount of loans
held or interest received by it, by an amount deemed material by
such Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an amount
received which such Lender reasonably determines is attributable to making,
funding and maintaining its Loans and its Commitment.
3.3. Changes in Capital Adequacy Regulations. If a Lender reasonably
---------------------------------------
determines the amount of capital required or expected to be maintained by such
Lender, any Lending Installation of such Lender or any corporation controlling
such Lender is increased as a result of a Change, then, within 15 days of demand
by such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender reasonably determines is attributable to
this Agreement, its Loans or its obligation to make Loans hereunder (after
taking into account such Lender's policies as to capital adequacy). Each Lender
shall notify the Borrower of any event occurring after the date of this
Agreement entitling such Lender to compensation under this Section 3.3 as
promptly as practicable, but in any event within 120 days after such Lender
obtains actual knowledge thereof; provided that if any Lender fails to give such
notice within 120 days after it obtains actual knowledge of such an event, such
Lender shall, with respect to compensation payable pursuant to this Section 3.3
in respect of any costs resulting from such event, only be entitled to payment
under this Section 3.3 for costs incurred from and after the date 120 days prior
to the date that such Lender does give such notice. "Change" means (i) any
change after the date of this Agreement in the Risk-Based Capital Guidelines, or
(ii) any adoption of or change in any other law, governmental or quasi-
governmental rule, regulation, policy, guideline, interpretation, or directive
(whether or not having the force of
Page 33
law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation
or any corporation controlling any Lender. "Risk-Based Capital Guidelines"
means (i) the risk-based capital guidelines in effect in the United States on
the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this Agreement.
3.4. Availability of Types of Advances. If any Lender reasonably
---------------------------------
determines that maintenance of its Fixed Rate Loans at a suitable Lending
Installation would violate any applicable law, rule, regulation, or directive,
whether or not having the force of law, then the Agent shall suspend the
availability of the affected Type of Advance and require any Fixed Rate Advances
of the affected Type to be repaid unless another Lender or other Lenders are
willing to make Competitive Bid Loans to the Borrower in substitution for the
affected Fixed Rate Loans. If the Required Lenders reasonably determine that
(i) deposits of a type and maturity appropriate to match fund Fixed Rate
Advances are not available or (ii) the interest rate applicable to a Type of
Advance does not accurately reflect the cost of making or maintaining such
Advance, then the Agent shall suspend the availability of the affected Type of
Advance and require any Fixed Rate Advances of the affected Type to be repaid.
3.5. Funding Indemnification. If any payment of a Fixed Rate Advance
-----------------------
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Fixed Rate
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost such Lender reasonably determines to have been incurred by such
Lender resulting therefrom, including, without limitation, any loss or cost in
liquidating or employing deposits acquired to fund or maintain the Fixed Rate
Advance.
3.6 Mitigation of Additional Costs or Adverse Circumstances. If, in
-------------------------------------------------------
respect of any Lender, circumstances arise which would or would upon the giving
of notice result in:
(i) an increase in the liability of the Borrower to such Lender
under Section 3.1, 3.2 or 3.3,
(ii) the unavailability of a Type of Committed Advance under
Section 3.4, or
Page 34
(iii) a Lender being incapable of receiving payments without
deduction or withholding of United States federal income tax,
then, without in any way limiting, reducing or otherwise qualifying the
Borrower's obligations under Section 3.1, 3.2, 3.3 or 3.4, such Lender shall
promptly, upon becoming aware of the same, notify the Agent and the Borrower
thereof and shall, in consultation with the Agent and the Borrower and to the
extent that it can do so without, in its reasonable judgment, disadvantaging
itself, take such reasonable steps as may be available to it to mitigate the
effects of such circumstances (including, without limitation, the designation of
an alternate Lending Installation or the transfer of its Loans to another
Lending Installation). If and so long as a Lender has been unable to take, or
has not taken, steps reasonably acceptable to the Borrower to mitigate the
effect of the circumstances in question, such Lender shall be obliged, at the
request of the Borrower, to assign all its rights and obligations hereunder to
another Person designated by the Borrower with the approval of the Agent (which
shall not be unreasonably withheld) and willing to participate in the facility
in place of such Lender; provided that such Person satisfies all of the
requirements of this Agreement, including, but not limited to, providing the
forms and documents required by Sections 2.16 and 12.3.2. Notwithstanding any
such assignment, the obligations of the Borrower under Sections 3.1, 3.2, 3.3
and 9.7 shall survive any such assignment and be enforceable by such Lender.
3.7. Lender Statements; Survival of Indemnity. To the extent reasonalby
----------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Fixed Rate Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1, 3.2 or 3.3 or to avoid the unavailability of a Type
of Advance under Section 3.4, so long as such designation is not, in such
Lender's reasonable judgment, disadvantageous to such Lender. Each Lender shall
deliver a written statement of such Lender as to the amount due, if any, under
Sections 3.1, 3.2, 3.3 or 3.5. Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and binding on the Borrower in the absence of
manifest error. Determination of amounts payable under such Sections in
connection with a Fixed Rate Loan shall be calculated as though each Lender
funded its Fixed Rate Loan through the purchase of a deposit of the type and
maturity corresponding to the deposit used as a reference in determining the
Fixed Rate applicable to such Loan, whether in fact that is the case or not.
Unless otherwise provided herein, the amount specified in the written statement
shall be payable on demand after receipt by the Borrower of the written
statement. The obligations of the Borrower under Sections 3.1, 3.2, 3.3 and 3.5
shall survive payment of the Obligations and termination of this Agreement.
Page 35
3.8. Market Disruption. Notwithstanding the satisfaction of all
-----------------
conditions referred to in Article IV with respect to any Foreign Currency
Advance, if there shall occur on or prior to the date of such Advance any change
in national or international financial, political or economic conditions or
currency exchange rates or exchange controls which would in the reasonable
opinion of the Agent or the Required Lenders make it impracticable for the
Foreign Currency Loans comprising such Advance to be denominated in the
Eurocurrency specified by the Borrower, then the Agent shall forthwith give
notice thereof to the Borrower and the Lenders, and such Loans shall not be
denominated in such Eurocurrency but shall be made on such Borrowing Date in
Dollars, in an aggregate principal amount equal to the Dollar Equivalent of the
aggregate principal amount specified in the related Committed Borrowing Notice
as Alternate Base Rate Loans, unless the Borrower notifies the Agent at least
one Business Day before such date that it elects not to borrow such Loans on
such date.
ARTICLE IV
CONDITIONS PRECEDENT
--------------------
4.1. Initial Advance. The Lenders shall not be required to make the
---------------
initial Advance hereunder and this Agreement shall not become effective unless
the Borrower has furnished to the Agent with sufficient copies for the Lenders:
(i) Copies of the articles of incorporation of the Borrower, together
with all amendments, and a certificate of good standing, both
certified by the appropriate governmental officer in its
jurisdiction of incorporation.
(ii) Copies, certified by the Secretary or Assistant Secretary of the
Borrower, of its by-laws and of its Board of Directors' resolutions
(and resolutions of other bodies, if any are deemed necessary by
counsel for any Lender) authorizing the execution of the Loan
Documents.
(iii) An incumbency certificate, executed by the Secretary or Assistant
Secretary of the Borrower, which shall identify by name and title
and bear the signature of the officers of the Borrower authorized to
sign the Loan Documents and to make borrowings hereunder, upon which
certificate the Agent and the Lenders shall be entitled to rely
until informed of any change in writing by the Borrower.
Page 36
(iv) A certificate, signed by the chief financial officer of the
Borrower, stating that on the initial Borrowing Date no Default or
Unmatured Default has occurred and is continuing.
(v) A written opinion of the Borrower's counsel, addressed to the Agent
and the Lenders in substantially the form of Exhibit "E" hereto.
(vi) Notes payable to the order of each of the Lenders.
(vii) Written money transfer instructions, in substantially the form of
Exhibit "G" hereto, addressed to the Agent and signed by an
Authorized Officer, together with such other related money transfer
authorizations as the Agent may have reasonably requested.
(viii) Such other documents as any Lender or its counsel may have
reasonably requested.
4.2. Each Advance. No Lender shall be required to make any Advance
------------
(other than a Committed Advance that, after giving effect thereto and to the
application of the proceeds thereof, does not increase the aggregate amount of
outstanding Committed Advances), unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are true
and correct as of such Borrowing Date except to the extent any such
representation or warranty is stated to relate solely to an earlier
date, in which case such representation or warranty shall be true
and correct on and as of such earlier date.
(iii) All legal matters incident to the making of such Advance shall be
satisfactory to the Lenders and their counsel.
Each Committed Borrowing Notice, Competitive Bid Quote Request and
Competitive Bid Acceptance Notice with respect to each such Advance shall
constitute a representation and warranty by the Borrower that the conditions
contained in Sections 4.2(i) and (ii) have been satisfied.
Page 37
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders that:
5.1. Corporate Existence and Standing. Each of the Borrower and its
---------------------------------
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted, except where such failure to obtain all requisite
authority would not, with respect to any individual failure or any failures in
the aggregate, have a Material Adverse Effect.
5.2. Authorization and Validity. The Borrower has the corporate power and
---------------------------
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by the Borrower
of the Loan Documents and the performance of its obligations thereunder have
been duly authorized by proper corporate proceedings, and the Loan Documents
constitute legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their terms, except as enforceability
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and equitable limitations upon
enforcement, whether by action for specific performance, injunctive relief or
otherwise, of remedies or obligations enforceable in a court of equity and the
discretion of the courts in granting or withholding equitable relief with
respect to such enforcement.
5.3. No Conflict; Government Consent. Neither the execution and delivery
--------------------------------
by the Borrower of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
any law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on the Borrower or any of its Subsidiaries or the Borrower's or any
Subsidiary's articles of incorporation or by-laws or the provisions of any
material indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in the
creation or imposition of any Lien in, of or on the Property of the Borrower or
a Subsidiary pursuant to the terms of any such indenture, instrument or
agreement. No order, consent, approval, license, authorization, or validation
of, or filing, recording or registration with, or exemption by, any Governmental
Agency is required to authorize, or is required in connection with the
execution, delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
Page 38
5.4. Financial Statements. The June 30, 1995 consolidated financial
---------------------
statements of the Borrower and its Subsidiaries heretofore delivered to the
Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Borrower and
its Subsidiaries at such date and the consolidated results of their operations
for the period then ended.
5.5. Material Adverse Change. Since June 30, 1995, there has been no
------------------------
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.
5.6. Taxes. The Borrower and its Subsidiaries have filed all United
------
States federal tax returns and all other tax returns which are required to be
filed (after any available extensions) and have paid all taxes due pursuant to
said returns or pursuant to any assessment received by the Borrower or any of
its Subsidiaries, except (i) those which are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been
set aside, or (ii) where such failure would not, with respect to any individual
failure or any failures in the aggregate, have a Material Adverse Effect. No
claims are being asserted with respect to any such taxes, except where any
claims, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect. No tax liens in excess of $1,000,000,
individually or in the aggregate, have been filed.
5.7. Litigation and Contingent Obligations. Except as set forth on
-------------------------------------
Schedule "1" hereto, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect. Other than any liability incident to such litigation, arbitration or
proceedings, the Borrower has no contingent obligations which could reasonably
be expected to have a Material Adverse Effect, except as permitted pursuant to
Section 6.14 hereof.
5.8. Subsidiaries. Form 10-K or 10-Q most recently filed by the Borrower
-------------
with the Securities and Exchange Commission contains an accurate list of all of
the "significant subsidiaries" (as defined in Rule 1-02 of Regulation S-X of the
Securities and Exchange Commission) of the Borrower as of the date thereof. All
of the issued and outstanding shares of capital stock of such Subsidiaries have
been duly authorized and issued and are fully paid and non-assessable.
5.9. ERISA. The Unfunded Liabilities of all Single Employer Plans do not
------
in the aggregate exceed $30,000,000. Neither
Page 39
the Borrower nor any other member of the Controlled Group has any Multiemployer
Plan. Each Plan complies in all material respects with all applicable
requirements of law and regulations. No Reportable Event which, individually or
in the aggregate with other Reportable Events then existing, could reasonably be
expected to have a Material Adverse Effect has occurred in connection with any
Plan. Neither the Borrower nor any other member of the Controlled Group has
withdrawn from any Plan or initiated steps to do so, and no steps have been
taken to reorganize or terminate any Plan, except in each case where any such
action would not reasonably be expected to have a Material Adverse Effect.
5.10. Accuracy of Information. No information, exhibit or report furnished
-----------------------
by the Borrower or any of its Subsidiaries to the Agent or to any Lender in
connection with the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact.
5.11. Regulation constitutes less than 25% of those assets of the Borrower
----------
and its Subsidiaries which are subject to any limitation on sale, pledge, or
other restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary is a
-------------------
party to any agreement or instrument or subject to any charter or other
corporate restriction which could, if performed or complied with by the Borrower
or any such Subsidiary, have a Material Adverse Effect. Neither the Borrower nor
any Subsidiary is in default in the performance, observance or fulfillment of
any of the obligations, covenants or conditions contained in (i) any agreement
to which it is a party, which default could reasonably be expected to have a
Material Adverse Effect or (ii) any agreement or instrument evidencing or
governing Indebtedness in excess of $25,000,000 individually or in the
aggregate.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have
--------------------
complied with all applicable material statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property, except where any
individual noncompliance or any noncompliance in the aggregate would not
reasonably be expected to have a Material Adverse Effect. Neither the Borrower
nor any Subsidiary has received any notice to the effect that its operations are
not in material compliance with any of the requirements of applicable federal,
state and local environmental, health and safety statutes and regulations or the
subject of any federal or state investigation evaluating whether any remedial
action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, which non-compliance or remedial action,
individually or in the
Page 40
aggregate, could reasonably be expected to have a Material Adverse Effect.
5.14. Investment Company Act. Neither the Borrower nor any Subsidiary
----------------------
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
5.15. Public Utility Holding Company Act. Neither the Borrower nor any
----------------------------------
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
ARTICLE VI
COVENANTS
---------
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself and
-------------------
each Subsidiary, a system of accounting established and administered in
accordance with generally accepted accounting principles, and furnish the
following to the Agent (and the Agent shall furnish copies thereof to the
Lenders):
(i) Within 90 days after the close of each of its fiscal years, an
unqualified (except for qualifications relating to changes in
accounting principles or practices reflecting changes in generally
accepted accounting principles and required or approved by the
Borrower's independent certified public accountants) audit report
certified by independent certified public accountants, reasonably
selected by the Borrower, prepared in accordance with Agreement
Accounting Principles on a consolidated basis for itself and the
Subsidiaries, including balance sheets as of the end of such period,
related profit and loss and reconciliation of surplus statements,
and a statement of cash flows, accompanied by any management letter
prepared by said accountants.
(ii) Within 60 days after the close of each of the first three quarterly
periods of each of its fiscal years, for itself and the
Subsidiaries, consolidated unaudited balance sheets as at the close
of each such period and consolidated profit and loss and
reconciliation of surplus statements
Page 41
and a consolidated statement of cash flows for the period from the
beginning of such fiscal year to the end of such quarter, all
certified by its chief financial officer or treasurer.
(iii) Together with the financial statements required hereunder, a
compliance certificate in substantially the form of Exhibit "F"
hereto signed by its chief financial officer or treasurer showing
the calculations necessary to determine compliance with this
Agreement and stating that no Default or Unmatured Default exists,
or if any Default or Unmatured Default exists, stating the nature
and status thereof.
(iv) As soon as possible and in any event within 21 days after the
Borrower knows that any Reportable Event has occurred with respect
to any Plan, a statement, signed by the chief financial officer of
the Borrower, describing said Reportable Event and the action which
the Borrower proposes to take with respect thereto.
(v) As soon as possible and in any event within 21 days after receipt by
the Borrower and reasonable determination by the Borrower that such
notice or claim is subject to this Section 6.1(v), a copy of (a) any
notice or claim to the effect that the Borrower or any of its
Subsidiaries is or may be liable to any Person as a result of the
release by the Borrower, any of its Subsidiaries, or any other
Person of any toxic or hazardous waste or substance into the
environment, and (b) any notice alleging any violation of any
federal, state or local environmental, health or safety law or
regulation by the Borrower or any of its Subsidiaries, which, in
either case, could reasonably be expected to have a Material Adverse
Effect.
(vi) Promptly upon the furnishing thereof to the shareholders of the
Borrower, copies of all financial statements, reports and proxy
statements so furnished.
(vii) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports
which the Borrower or any of its Subsidiaries files with the
Securities and Exchange Commission.
(viii) Such other information (including non-financial information) as the
Agent or any Lender may from time to time reasonably request.
Page 42
6.2. Use of Proceeds. The Borrower will, and will cause each Subsidiary
---------------
to, use the proceeds of the Advances for general corporate purposes, including
commercial paper back-up, and to repay outstanding Advances. The Borrower will
not, nor will it permit any Subsidiary to, use any of the proceeds of the
Advances (x) to purchase or carry any "margin stock" (as defined in Regulation
U) in violation of Regulation U, or (y) to make any Acquisition which has not
been approved by the board of directors of the entity being acquired.
6.3. Notice of Default. The Borrower will give prompt notice in writing
-----------------
to the Agent (and the Agent will promptly give a copy thereof to the Lenders) of
the occurrence of any Default or Unmatured Default and of any other development,
financial or otherwise, which could reasonably be expected to have a Material
Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
-------------------
Subsidiary to, carry on and conduct its business in the achievement and
affiliation recognition business as it is presently conducted and to do all
things necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation and
maintain all requisite authority to conduct its business in each jurisdiction in
which its business is conducted, except where such failure to maintain all
requisite authority would not, with respect to any individual failure or any
failures in the aggregate, have a Material Adverse Effect.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to, pay
-----
when due all taxes, assessments and governmental charges and levies upon it or
its income, profits or Property, except (i) those which are being contested in
good faith by appropriate proceedings and with respect to which adequate
reserves have been set aside, or (ii) where such failure would not, with respect
to any individual failure or any failures in the aggregate, have a Material
Adverse Effect.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
---------
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice.
6.7. Compliance with Laws. The Borrower will, and will cause each
--------------------
Subsidiary to, comply with all material laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except
where any individual noncompliance or any noncompliance in the aggregate would
not reasonably be expected to have a Material Adverse Effect.
Page 43
6.8. Maintenance of Properties. The Borrower will, and will cause each
-------------------------
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property generally in good repair, working order and condition, and make all
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times.
6.9. Inspection. The Borrower will, and will cause each Subsidiary to,
----------
permit the Agent, by its representatives and agents, and at the expense and
reasonable request of the Required Lenders, to inspect any of the Property,
corporate books and financial records of the Borrower and each Subsidiary, to
examine and make copies of the books of accounts and other financial records of
the Borrower and each Subsidiary, and to discuss the affairs, finances and
accounts of the Borrower and each Subsidiary with, and to be advised as to the
same by, their respective officers, all upon reasonable notice to the Borrower
and at such reasonable times and intervals as the Agent may designate; provided,
however, that upon the occurrence and during the continuance of a Default or
Unmatured Default, the Agent and any of the Lenders may exercise any of the
rights set forth in this Section 6.9, all at the Borrower's expense and at such
times and intervals as the Agent and any such Lender may designate.
6.10. Borrower will not, nor will it permit any Subsidiary to, merge or
consolidate with or into any other Person, except that:
(i) any Subsidiary may merge with the Borrower or a Wholly-Owned
Subsidiary provided that the Borrower or such Wholly-Owned
Subsidiary is the continuing or surviving corporation; or
(ii) the Borrower or any Wholly-Owned Subsidiary, as the case may be, may
merge with another Person; provided that (x) the Borrower or such
Wholly-Owned Subsidiary, as the case may be, is the continuing or
surviving corporation; and (y) immediately after the consummation of
the transaction, and after giving effect thereto, no Default or
Unmatured Default exists.
6.11. Sale of Assets. The Borrower will not, nor will it permit any
--------------
Subsidiary to, lease, sell or otherwise dispose of its Property, to any other
Person except for (i) sales of inventory in the ordinary course of business and
(ii) leases, sales or other dispositions of its Property that, together with all
other Property of the Borrower and its Subsidiaries previously leased, sold or
disposed of (other than inventory in the ordinary course of business) as
permitted by this Section during the twelve-month period ending with the month
in which any such lease, sale or other disposition occurs, do not constitute a
Substantial Portion of the Property of the Borrower and its Subsidiaries.
Page 44
6.12. Investments and Acquisitions. The Borrower will not, nor will it
----------------------------
permit any Subsidiary to, make or suffer to exist any Investments (including,
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to make any Acquisition of any
Person, except:
(i) Investments made in accordance with the Investment Guidelines.
(ii) Commission, travel and similar advances made by the Borrower or any
Subsidiary to its officers, employees and independent sales
representatives in the ordinary course of business.
(iii) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule "2" hereto.
(iv) Acquisitions of Persons organized in the United States; provided
that (x) any such Acquisition has been approved by the board of
directors of the Person being acquired, and (y) prior to the
consummation of any such Acquisition having a purchase price in
excess of $150,000,000, the Borrower furnishes to the Agent and the
Lenders pro forma financial statements, in form and substance
--- -----
satisfactory to the Required Lenders, demonstrating that immediately
after the consummation of any such Acquisition, there shall be no
Default or Unmatured Default.
(v) Acquisitions of Persons organized outside of the United States;
provided that (x) such Acquisition has been approved by the board of
directors of the Person being acquired, and (y) prior to the
consummation of any such Acquisition having a purchase price in
excess of $50,000,000, the Borrower furnishes to the Agent and the
Lenders pro forma financial statements, in form and substance
--- -----
satisfactory to the Required Lenders, demonstrating that immediately
after the consummation of any such Acquisition, there shall be no
Default or Unmatured Default.
(vi) Investments in Wholly-Owned Subsidiaries.
(vii) Investments in Subsidiaries (other than Wholly-Owned Subsidiaries)
in an aggregate amount not to exceed 20% of Consolidated Assets at
any one time outstanding.
(viii) In addition to the foregoing, Investments in an aggregate amount not
to exceed 10% of Consolidated Assets at any one time outstanding.
Page 45
6.13. Subsidiary Indebtedness. The Borrower will not permit any
-----------------------
Subsidiary to create, incur or suffer to exist any Indebtedness, except:
(i) Indebtedness existing on the date hereof and described in Schedule
"3" hereto.
(ii) Indebtedness owing to their independent sales representatives in
connection with commissions to be paid to such representatives in
the ordinary course of business.
(iii) Indebtedness incurred in connection with Investments permitted
under Section 6.12(vi), (vii) or (viii).
(iv) Contingent Obligations permitted under Section 6.14 hereof.
(v) Indebtedness owing to the Borrower or any Wholly-Owned Subsidiary.
(vi) In addition to the foregoing, Indebtedness in an aggregate principal
amount not to exceed 10% of Consolidated Assets at any one time
outstanding.
6.14. Contingent Obligations. The Borrower will not, nor will it permit
----------------------
any Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary), except:
(i) Contingent Obligations existing on the date hereof and described in
Schedule "3" hereto.
(ii) By endorsement of instruments for deposit or collection in the
ordinary course of business.
(iii) Contingent Obligations incurred by the Borrower or any Subsidiary
in connection with the intercompany Indebtedness of the Borrower or
any Wholly-Owned Subsidiary.
(iv) In addition to the foregoing, Contingent Obligations of the Borrower
and its Subsidiaries not exceeding $50,000,000 in the aggregate at
any one time outstanding.
6.15. Liens. The Borrower will not, nor will it permit any Subsidiary to,
-----
create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
Page 46
(i) Liens for taxes, assessments or governmental charges or levies on
its Property if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in
good faith and by appropriate proceedings and for which adequate
reserves in accordance with generally accepted accounting principles
shall have been set aside on its books.
(ii) Liens imposed by law such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary
course of business which secure payment of obligations not more than
60 days past due or which are being contested in good faith by
appropriate proceedings and for which adequate reserves shall have
been set aside on its books.
(iii) Liens arising out of pledges or deposits under worker's compensation
laws, unemployment insurance, old age pensions, or other social
security or retirement benefits, or similar legislation (except
ERISA).
(iv) Utility easements, building restrictions and such other encumbrances
or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which
do not in any material way affect the marketability of the same or
interfere with the use thereof in the business of the Borrower or
the Subsidiaries.
(v) Liens existing on the date hereof and described in Schedule "3"
hereto.
(vi) Liens of or resulting from any judgments or awards in an amount not
exceeding $10,000,000 in the aggregate, the time for the appeal or
petition for rehearing of which shall not have expired, or in
respect of which the Borrower or such Subsidiary is prosecuting an
appeal or proceeding for review.
(vii) Liens arising in the ordinary course of business in connection with
obligations that are not overdue or which are being contested in
good faith and by appropriate proceedings, including, but not
limited to, Liens under bid, performance and other surety bonds,
supersedeas and appeal bonds, Liens on advance or progress payments
received from customers under contracts for the sale, lease or
license of goods, software or services and upon the products being
sold or licensed, in each case securing performance of the
underlying contract or the repayment of such advances in the event
final acceptance or performance under such contracts does not occur;
and
Page 47
Liens upon funds collected temporarily from others pending payment
or remittance on their behalf.
(viii) Purchase money security interests on any Property acquired or held
by the Borrower or its Subsidiaries in the ordinary course of
business, securing Indebtedness incurred or assumed for the purpose
of financing all or any part of the cost of acquiring such Property;
provided that (i) any such Lien attaches to such Property
concurrently with or within 20 days after the acquisition thereof,
(ii) such Lien attaches solely to the Property so acquired in such
transaction, and (iii) the principal amount of the Indebtedness
secured thereby does not exceed 100% of the cost of such Property.
(ix) Liens arising solely by virtue of any statutory or common law
provision relating to bankers' liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained
with a creditor depository institution.
(x) Any Lien on any asset acquired by the Borrower or any of its
Subsidiaries, which Lien existed at the time such asset was acquired
by the Borrower or any of its Subsidiaries or is merged into or
consolidated with the Borrower or any of its Subsidiaries and not
created in contemplation of such event, and any extension, renewal
or replacement Lien (any "Replacement Lien") arising out of the
extension, renewal or replacement of the related Indebtedness
secured by such Lien; provided that (x) the aggregate unpaid
principal amount of Indebtedness which is secured pursuant to this
clause (x) after any such extension, renewal or replacement shall be
no greater than the aggregate unpaid principal amount of such
Indebtedness secured pursuant to this clause (x) immediately
preceding such extension, renewal or replacement, and (y) any such
Replacement Lien shall attach solely to the Property which was
subject to a Lien immediately preceding such extension, renewal or
replacement.
(xi) In addition to the foregoing, Liens securing Indebtedness of the
Borrower and its Subsidiaries in an aggregate principal amount not
exceeding $30,000,000 at any one time outstanding.
6.16. Interest Coverage Ratio. The Borrower shall maintain, as at the
-----------------------
last day of each fiscal quarter of the Borrower, an Interest Coverage Ratio for
such fiscal quarter and the three immediately preceding fiscal quarters, of not
less than 3.0:1.0.
Page 48
6.17. Net Worth. The Borrower shall maintain at all times Net Worth of not
---------
less than $80,000,000.
6.18. Affiliates. The Borrower will not, and will not permit any
----------
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate (except for any Wholly-Owned Subsidiary) except in
the ordinary course of business and pursuant to the reasonable requirements of
the Borrower's or such Subsidiary's business and upon fair and reasonable terms
no less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction.
ARTICLE VII
DEFAULTS
--------
The occurrence of any one or more of the following events shall constitute
a Default:
7.1. Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders or the Agent under or
in connection with this Agreement, any Loan, or any certificate or information
delivered in connection with this Agreement or any other Loan Document shall be
materially false on the date as of which made.
7.2. Nonpayment of principal of any Note when due, or nonpayment of
interest upon any Note or of any fee or other Obligations under any of the Loan
Documents within five days after the same becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Section 6.2 and Sections 6.10 through and including 6.18.
7.4. The breach by the Borrower (other than a breach which constitutes a
Default under Section 7.1, 7.2 or 7.3) of any of the terms or provisions of this
Agreement which is not remedied within thirty days after written notice from the
Agent or any Lender.
7.5. Failure of the Borrower or any of its Subsidiaries to pay any
Indebtedness in excess of $25,000,000 individually or in the aggregate when due;
or the default by the Borrower or any of its Subsidiaries in the performance of
any term, provision or condition contained in any agreement under which any
Indebtedness in excess of $25,000,000 individually or in the aggregate was
created or is governed, or any other event shall occur or condition
Page 49
exist, and continue after any applicable notice or grace period has expired, the
effect of which is to cause, or to permit the holder or holders of such
Indebtedness to cause, such Indebtedness to become due prior to its stated
maturity; or any Indebtedness of the Borrower or any of its Subsidiaries in
excess of $25,000,000 individually or in the aggregate shall be declared to be
due and payable or required to be prepaid (other than by a regularly scheduled
payment) prior to the stated maturity thereof; or the Borrower or any of its
Subsidiaries shall not pay, or admit in writing its inability to pay, its debts
generally as they become due; provided that, notwithstanding anything to the
contrary in this Section 7.5, the failure of the Borrower or any of its
Subsidiaries to pay obligations on commercial paper issued by any of them when
due, arising solely out of the inability of any of them to rollover or issue
replacement commercial paper on the maturity date and the inability of the
Borrower to borrow hereunder solely because of time and notice limitations on
such date shall not be deemed a Default under this Section 7.5, so long as the
Borrower or any such Subsidiary is able to cure any default under such
commercial paper on the next day by a rollover or issue of replacement
commercial paper on the next day or is able to pay such obligations on the next
day (including, without limitation, with proceeds of the Loans hereunder so long
as all of the conditions set forth in Section 4.2 hereof shall have been
satisfied).
7.6. The Borrower or any of its Subsidiaries shall (i) have an order for
relief entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (ii) make an assignment for the benefit of creditors, (iii)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (v)
take any corporate action to authorize or effect any of the foregoing actions
set forth in this Section 7.6 or (vi) fail to contest in good faith any
appointment or proceeding described in Section 7.7.
7.7. Without the application, approval or consent of the Borrower or any
of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries and
such appointment continues undischarged or such proceeding continues undismissed
or unstayed for a period of 45 consecutive days.
Page 50
7.8. Any court or Governmental Agency shall condemn, seize or otherwise
appropriate, or take custody or control of (each a "Condemnation"), all or any
portion of the Property of the Borrower and its Subsidiaries which, when taken
together with all other Property of the Borrower and its Subsidiaries so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such Condemnation occurs,
constitutes a Substantial Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge any judgment or order for the payment of money
in excess of $10,000,000, which is not stayed on appeal or otherwise being
appropriately contested in good faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall exceed
in the aggregate $30,000,000.
7.11. Any Reportable Event which, individually or in the aggregate with
other Reportable Events then existing, could reasonably be expected to have a
Material Adverse Effect shall occur in connection with any Plan.
7.12. The Borrower or any of its Subsidiaries shall be the subject of any
proceeding or investigation pertaining to the release by the Borrower or any of
its Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, or any violation of any federal, state or local
environmental, health or safety law or regulation, which, in either case,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
7.13. Any Change in Control shall occur.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1. Acceleration. If any Default described in Section 7.6 or 7.7 occurs
------------
with respect to the Borrower, the obligations of the Lenders to make Loans
hereunder shall automatically terminate and the Obligations shall immediately
become due and payable without any election or action on the part of the Agent
or any Lender. If any other Default occurs and is continuing, the Required
Lenders may terminate or suspend the obligations of the Lenders to make Loans
hereunder, or declare the Obligations to be due and payable, or both, whereupon
the Obligations shall become immediately due and payable, or both, all without
presentment,
Page 51
demand, protest or notice of any kind, all of which the Borrower hereby
expressly waives.
If, within fourteen (14) days after acceleration of the maturity of the
Obligations or termination or suspension of the obligations of the Lenders to
make Loans hereunder as a result of any Default (other than any Default as
described in Section 7.6 or 7.7 with respect to the Borrower) and before any
judgment or decree for the payment of the Obligations due shall have been
obtained or entered, the Required Lenders (in their sole discretion) shall so
direct, the Agent shall, by notice to the Borrower, rescind and annul such
acceleration and/or termination (or suspension).
8.2. Amendments. Subject to the provisions of this Article VIII, the
----------
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of each Lender affected thereby:
(i) Extend the maturity of any Loan or Note or forgive all or any
portion of the principal amount thereof, or reduce the rate or
extend the time of payment of interest or fees thereon.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Termination Date, or increase the amount of the
Commitment of any Lender hereunder, or permit the Borrower to assign
its rights under this Agreement.
(iv) Amend this Section 8.2.
No amendment of any provision of this Agreement relating to the Agent shall
be effective without the written consent of the Agent. The Agent may waive
payment of the fee required under Section 12.3.2 without obtaining the consent
of any other party to this Agreement.
8.3. Preservation of Rights. No delay or omission of the Lenders or the
----------------------
Agent to exercise any right under the Loan Documents shall impair such right or
be construed to be a waiver of any Default or an acquiescence therein, and the
making of a Loan notwithstanding the existence of a Default or the inability of
the Borrower to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver,
Page 52
amendment or other variation of the terms, conditions or provisions of the Loan
Documents whatsoever shall be valid unless in writing signed by the Lenders
required pursuant to Section 8.2 (or the Agent with the consent in writing of
such Lenders), and then only to the extent in such writing specifically set
forth. All remedies contained in the Loan Documents or by law afforded shall be
cumulative and all shall be available to the Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1. Survival of Representations. All representations and warranties of the
---------------------------
Borrower contained in this Agreement shall survive delivery of the Notes and the
making of the Loans herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to the
-----------------------
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Taxes. Any taxes (excluding federal income taxes on the overall net
-----
income of any Lender) or other similar assessments or charges made by any
governmental or revenue authority in respect of the Loan Documents shall be paid
by the Borrower, together with interest and penalties, if any.
9.4. Headings. Section headings in the Loan Documents are for convenience
--------
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
9.5. Entire Agreement. The Loan Documents and the Letter Agreement referred
----------------
to in Section 2.6.2 embody the entire agreement and understanding among the
Borrower, the Agent and the Lenders and supersede all prior agreements and
understandings among the Borrower, the Agent and the Lenders relating to the
subject matter thereof.
9.6. Several Obligations; Benefits of this Agreement. The respective
-----------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the
Page 53
parties to this Agreement and their respective successors and assigns.
9.7. Expenses; Indemnification.
-------------------------
(i) Subject to the Letter Agreement, dated November 16, 1995, between the
Borrower and the Agent, the Borrower shall reimburse the Agent for any costs,
internal charges and out-of-pocket expenses (including attorneys' fees and time
charges of attorneys for the Agent, which attorneys may be employees of the
Agent) paid or incurred by the Agent in connection with the preparation,
negotiation, execution, delivery, review, amendment, modification, and
administration of the Loan Documents. The Borrower also agrees to reimburse the
Agent and the Lenders for any costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the Agent and the
Lenders, which attorneys may be employees of the Agent or the Lenders) paid or
incurred by the Agent or any Lender in connection with the collection and
enforcement of the Loan Documents. The Borrower further agrees to indemnify the
Agent and each Lender and their respective directors, officers and employees
(each an "Indemnified Party") against all losses, claims, damages, penalties,
judgments, liabilities and expenses (including, without limitation, all expenses
of litigation or preparation therefor whether or not the Agent or any Lender is
a party thereto) which any Indemnified Party may pay or incur arising out of or
relating to this Agreement, the other Loan Documents, the transactions
contemplated hereby or the direct or indirect application or proposed
application of the proceeds of any Loan hereunder, except that any such
Indemnified Party shall not be indemnified for any such losses, claims, damages,
penalties, judgments, liabilities and expenses to the extent that they arise
from the gross negligence or willful misconduct of such Indemnified Party. The
obligations of the Borrower under this Section shall survive the termination of
this Agreement.
(ii) The obligations and liabilities of the Borrower with respect to claims
resulting from the assertion of liability by third parties shall be subject to
the following terms and conditions:
(a) Each Indemnified Party agrees to give prompt written notice thereof to
the Borrower of any claim based on this Section 9.7, stating the
nature and basis of said claim and the amount thereof, to the extent
known.
(b) In the event such Indemnified Party shall notify the Borrower of any
claim pursuant to subsection (a) hereof, the Borrower shall have the
right to elect to defend such claim (including all actions, suits,
proceedings and all proceedings on appeal or for review which counsel
deems appropriate), with counsel reasonably satisfactory to
Page 54
such Indemnified Party, by written notice to such Indemnified Party
within 30 days after receipt of such notice. The Indemnified Party
may retain its own counsel on such matter, at its own expense, to
consult or otherwise represent its interests. The Indemnified Party
shall make available to the Borrower and its attorneys and
accountants all books and records of the Indemnified Party relating
to such proceedings or litigation, and the parties hereto agree to
render to each other such assistance as they may reasonably require
of each other in order to ensure the proper and adequate defense of
any such action, suit or proceeding.
(c) So long as the Borrower is defending in good faith any such claim,
the Indemnified Party shall not compromise or settle such claim,
without written consent of the Borrower.
9.8. Numbers of Documents. All statements, notices, closing documents, and
--------------------
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.
9.9. Accounting. Except as provided to the contrary herein, all accounting
----------
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
9.10. Severability of Provisions. Any provision in any Loan Document that
--------------------------
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.11. Nonliability of Lenders. The relationship between the Borrower and
-----------------------
the Lenders and the Agent shall be solely that of borrower and lender. Neither
the Agent nor any Lender shall have any fiduciary responsibilities to the
Borrower under the Loan Documents. Neither the Agent nor any Lender undertakes
any responsibility to the Borrower to review or inform the Borrower of any
matter in connection with any phase of the Borrower's business or operations.
9.12. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
-------------
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
Page 55
9.13. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
-----------------------
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. ANY JUDICIAL PROCEEDING BY THE BORROWER
AGAINST THE AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED
TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN
CHICAGO, ILLINOIS.
9.14. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER HEREBY
--------------------
WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
9.15. Confidentiality. Each Lender agrees to hold any confidential
---------------
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to other Lenders and their respective
Lender Affiliates, (ii) to legal counsel, accountants, and other professional
advisors to such Lender or to a Transferee, (iii) to regulatory officials, (iv)
to any Person as required by law, regulation, or legal process, (v) to any
Person in connection with any legal proceeding to which such Lender is a party,
provided that such Lender gives the Borrower reasonable notice to allow the
Borrower to object to such Lender or such Person regarding such disclosure (so
long as such Lender is not prohibited from giving such notice), and (vi)
permitted by Section 12.4.
ARTICLE X
THE AGENT
---------
10.1. Appointment. The First National Bank of Chicago is hereby appointed
-----------
Agent hereunder and under each other Loan Document, and each of the Lenders
irrevocably authorizes the Agent to act as the agent of such Lender. The Agent
agrees to act as such upon the express conditions contained in this Article X.
The Agent shall not have a fiduciary relationship in respect of the Borrower or
any Lender by reason of this Agreement.
10.2. Powers. The Agent shall have and may exercise such powers under the
------
Loan Documents as are specifically delegated to
Page 56
the Agent by the terms of each thereof, together with such powers as are
reasonably incidental thereto. The Agent shall have no implied duties to the
Lenders, or any obligation to the Lenders to take any action thereunder except
any action specifically provided by the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
----------------
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
for its or their own gross negligence or willful misconduct.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent nor any
-------------------------------------------
of its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into, or verify (i) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (iii) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered to the Agent; (iv) the validity,
effectiveness or genuineness of any Loan Document or any other instrument or
writing furnished in connection therewith; or (v) the value, sufficiency,
creation, perfection or priority of any interest in any collateral security. The
Agent shall have no duty to disclose to the Lenders information that is not
required to be furnished by the Borrower to the Agent at such time, but is
voluntarily furnished by the Borrower to the Agent (either in its capacity as
Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all cases be
---------------------------------
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders (or, when expressly required hereunder or under any other Loan
Document, all the Lenders), and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Lenders and on
all holders of Notes. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any of its
--------------------------------
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
Page 57
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to rely
------------------------------
upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree to
-----------------------------------------
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (i) for any amounts not reimbursed by the Borrower for which the
Agent is entitled to reimbursement by the Borrower under the Loan Documents,
(ii) for any other expenses incurred by the Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent in any way relating to or arising out
of the Loan Documents or any other document delivered in connection therewith or
the transactions contemplated thereby, or the enforcement of any of the terms
thereof or of any such other documents, provided that no Lender shall be liable
for any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the Agent. The obligations of the Lenders under this
Section 10.8 shall survive payment of the Obligations and termination of this
Agreement.
10.9. Rights as a Lender. In the event the Agent is a Lender, the Agent
------------------
shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the same as though it were not the
Agent, and the term "Lender" or "Lenders" shall, at any time when the Agent is a
Lender, unless the context otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Agent, in its individual capacity, is not obligated to remain a Lender.
10.10. Lender Credit Decision. Each Lender acknowledges that it has,
----------------------
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by
Page 58
the Borrower and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement and the other Loan Documents. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement and the other Loan Documents.
10.11. Successor Agent. The Agent may resign at any time by giving written
---------------
notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation and so long as no Default or
Unmatured Default has occurred and is continuing, the Borrower shall have the
right to appoint, on behalf of the Borrower and the Lenders, a successor Agent;
provided, however, that such successor Agent shall be approved by the Required
Lenders (with such approval not to be unreasonably withheld). If a Default or
Unmatured Default has occurred and is continuing, such successor Agent shall be
appointed, on behalf of the Borrower and the Lenders, by the Required Lenders.
If no successor Agent shall have been appointed pursuant to the immediately
preceding two sentences within thirty days after the resigning Agent's giving
notice of its intention to resign, then the resigning Agent may appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If the Agent has
resigned and no successor Agent has been appointed, the Lenders may perform all
the duties of the Agent hereunder and the Borrower shall make all payments in
respect of the Obligations to the applicable Lenders and for all other purposes
shall deal directly with the Lenders. In addition to the foregoing, so long as
no Default or Unmatured Default has occurred and is continuing, the Borrower
shall have the right to replace the Agent; provided, however, that such
successor Agent shall be approved by the Required Lenders (with such approval
not to be unreasonably withheld. No successor Agent shall be deemed to be
appointed hereunder until such successor Agent has accepted the appointment.
Any such successor Agent shall be a commercial bank having capital and retained
earnings of at least $250,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent. Upon the effectiveness of the resignation or replacement
of the Agent, the resigning or replaced Agent shall be discharged from its
duties and obligations hereunder and under the Loan Documents. After the
effectiveness of the resignation or replacement of the Agent, the provisions of
this Article X shall continue in effect for the benefit of such Agent in respect
of any actions taken or omitted to be taken by it while it was acting as the
Agent hereunder and under the other Loan Documents.
Page 59
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1. Setoff. In addition to, and without limitation of, any rights of the
------
Lenders under applicable law, if the Borrower becomes insolvent and for so long
as the Borrower is insolvent, however evidenced, or any Default occurs and is
continuing, any and all deposits (including all account balances, whether
provisional or final and whether or not collected or available) and any other
Indebtedness at any time held or owing by any Lender to or for the credit or
account of the Borrower may be offset and applied toward the payment of the
Obligations owing to such Lender, whether or not the Obligations, or any part
hereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
----------------
payment made to it upon its Loans (other than payments received pursuant to
Sections 3.1, 3.2 or 3.4) in a greater proportion than that received by any
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
12.1. Successors and Assigns. The terms and provisions of the Loan
----------------------
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (ii) of this Section, any Lender may
at any time, without the consent of the Borrower or the Agent, assign all or any
portion of its rights under this Agreement and its Notes to a Federal Reserve
Bank; provided, however, that no such assignment shall release the transferor
Lender from its obligations hereunder. The Agent may treat the payee of any Note
as the owner thereof for all purposes hereof unless and until such payee
complies with Section 12.3 in the case of an assignment
Page 60
thereof or, in the case of any other transfer, a written notice of the transfer
is filed with the Agent. Any assignee or transferee of a Note agrees by
acceptance thereof to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the holder of any
Note, shall be conclusive and binding on any subsequent holder, transferee or
assignee of such Note or of any Note or Notes issued in exchange therefor.
12.2. Participations.
--------------
12.2.1 Permitted Participants; Effect. Any Lender may, in the
------------------------------
ordinary course of its business and in accordance with applicable law, at
any time sell to one or more banks or other entities ("Participants")
participating interests in any Loan owing to such Lender, any Note held by
such Lender, the Commitment of such Lender or any other interest of such
Lender under the Loan Documents. In the event of any such sale by a Lender
of participating interests to a Participant, such Lender's obligations
under the Loan Documents shall remain unchanged, such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, such Lender shall remain the holder of any such Note for all
purposes under the Loan Documents, all amounts payable by the Borrower
under this Agreement shall be determined as if such Lender had not sold
such participating interests, and the Borrower and the Agent shall continue
to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole right to
-------------
approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents.
12.3. Assignments.
-----------
12.3.1. Permitted Assignments. Any Lender may, in the ordinary
---------------------
course of its business and in accordance with applicable law, at any time
assign to one or more banks or other entities ("Purchasers") all or any
part, in a minimum amount of $10,000,000, of its rights and obligations
under the Loan Documents. Such assignment shall be substantially in the
form of Exhibit "H" hereto or in such other form as may be agreed to by the
parties thereto. The consent of the Borrower and the Agent shall be
required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or a Lender Affiliate.
12.3.2. Effect; Effective Date. Upon (i) delivery to the Agent of a
----------------------
notice of assignment, substantially in the form
Page 61
attached as Exhibit "I" to Exhibit "H" hereto (a "Notice of Assignment"),
together with any consents required by Section 12.3.1, and (ii) payment of
a $3,000 fee to the Agent for processing such assignment, such assignment
shall become effective on the effective date specified in such Notice of
Assignment. The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that the rights and
interests of the Purchaser in and under the Loan Documents will not be
"plan assets" under ERISA. On and after the effective date of such
assignment, such Purchaser shall for all purposes be a Lender party to this
Agreement and any other Loan Document executed by the Lenders and shall
have all the rights and obligations of a Lender under the Loan Documents,
to the same extent as if it were an original party hereto, and no further
consent or action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to the percentage of
the Aggregate Commitment and Loans assigned to such Purchaser. Upon the
consummation of any assignment to a Purchaser pursuant to this Section
12.3.2, the transferor Lender, the Agent and the Borrower shall make
appropriate arrangements so that replacement Notes are issued to such
transferor Lender and new Notes or, as appropriate, replacement Notes, are
issued to such Purchaser, in each case in principal amounts reflecting
their Commitment, as adjusted pursuant to such assignment.
12.4. Dissemination of Information. The Borrower authorizes each Lender to
-----------------------------
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries; provided
that each Transferee and prospective Transferee agrees to be bound by Section
9.15 of this Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is transferred
-------------
to any Transferee which is organized under the laws of any jurisdiction other
than the United States or any State thereof, the transferor Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with the provisions of Section 2.16.
ARTICLE XIII
NOTICES
-------
13.1. Giving Notice. Except as otherwise permitted by Section 2.11 with
-------------
respect to borrowing notices, all notices and
Page 62
other communications provided to any party hereto under this Agreement or any
other Loan Document shall be in writing or by telex or by facsimile and
addressed or delivered to such party at its address set forth below its
signature hereto or at such other address as may be designated by such party in
a notice to the other parties. Any notice, if mailed and properly addressed
with postage prepaid, shall be deemed given when received; any notice, if
transmitted by telex or facsimile, shall be deemed given when transmitted
(answerback confirmed in the case of telexes).
13.2. Change of Address. The Borrower, the Agent and any Lender may each
-----------------
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV
COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Agent and the Lenders
and each party has notified the Agent by telex, facsimile, or telephone, that it
has taken such action.
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
JOSTENS, INC.
By: /s/ Xxxxx X. Ratio
------------------
Print Name: Xxxxx X. Xxxxxx
---------------
Title: Sr. VP & CFO
By: /s/ Xxx X. XxXxxxx
------------------
Print Name: Xxx X. XxXxxxx
--------------
Title: VP & Treasurer
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxx X. XxXxxxx
Treasurer
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 63
Commitment
$30,000,000 THE FIRST NATIONAL BANK OF CHICAGO,
Individually and as Agent
By: /s/ Xxxxxxx X. XxXxxxxx
--------------------------
Print Name: Xxxxxxx X. XxXxxxxx
-------------------
Title: Authorized Agent
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. XxXxxxxx
Vice President/
Senior Banker
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 64
Commitment
----------
$30,000,000 CREDIT SUISSE
By: /s/ Xxx Xxxxx
-------------
Print Name: Xxx Xxxxx
---------
Title: Member of Senior Management
By: /s/ Xxxxxxxx X. Xxxxxxxxxxx
-----------------------------
Print Name: Xxxxxxxx X. Xxxxxxxxxxx
-----------------------
Title: Associate
000 Xxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxxxxx
Member of Senior
Management
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 65
Commitment
----------
$30,000,000 XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By: /s/ Xxxxxxxxx X. Xxxx
---------------------
Print Name: Xxxxxxxxx X. Xxxx
-----------------
Title: Vice President
00 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Corporate Banking
North America 1
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 66
Commitment
----------
$30,000,000 NORWEST BANK MINNESOTA N.A.
By: /s/ Xxxxx X. Xxxxx
------------------
Print Name: Xxxxx X. Xxxxx
--------------
Title: Assistant Vice President
0xx xxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxx
00000-0000
Attn: Xxxxx Xxxxx
Assistant Vice President
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 67
Commitment
----------
$30,000,000 ROYAL BANK OF CANADA
By: /s/ Xxxxxxx X. Xxxxx
--------------------
Print Name: Xxxxxxx X. Xxxxx
----------------
Title: Senior Manager, Corporate Banking
Grand Cayman
(North America No. 1) Branch
c/o New York Branch
Financial Square, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Manager,
Credit Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Page 68
