Exhibit 10(a)
$620,000,000
CREDIT AGREEMENT
Dated as of January 30, 1998
Among
MARRIOTT INTERNATIONAL, INC. (to be renamed
SODEXHO MARRIOTT SERVICES, INC.)
as Borrower
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
and
SOCIETE GENERALE and X.X. XXXXXX SECURITIES INC.
as Arrangers
and
SOCIETE GENERALE
as Administrative Agent
and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
as Documentation Agent
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms............................................ 1
1.02. Computation of Time Periods...................................... 15
1.03. Accounting Terms and Determinations.............................. 15
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCE
2.01. The Advance...................................................... 16
2.02. Making the Advances.............................................. 16
2.03. Repayment of Advances............................................ 17
2.04. Termination or Reduction of the Facility......................... 17
2.05. Prepayments...................................................... 17
2.06. Interest......................................................... 17
2.07. Fees............................................................. 18
2.08. Conversion and Continuation of Advances.......................... 18
2.09. Increased Costs, Etc............................................. 19
2.10. Payments and Computations........................................ 20
2.11. Taxes............................................................ 21
2.12. Sharing of Payments, Etc......................................... 23
2.13. Use of Proceeds.................................................. 24
2.14. Defaulting Lenders............................................... 24
2.15. Regulation D Compensation........................................ 26
2.16. Base Rate Advances Substituted for Affected Eurodollar
Rate Advances ................................................... 26
2.17. Replacement of Certain Lenders................................... 26
ARTICLE III
CONDITIONS OF LENDING
3.01. Conditions Precedent to Closing.................................. 27
3.02. Conditions Precedent to Borrowing................................ 27
3.03. Determinations Under Section 3.02................................ 31
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrower................... 32
ARTICLE V
COVENANTS OF THE BORROWER
5.01. Affirmative Covenants............................................ 36
5.02. Negative Covenants............................................... 38
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5.03. Reporting Requirements........................................... 40
5.04. Financial Covenants.............................................. 42
ARTICLE VI
EVENTS OF DEFAULT
6.01. Events of Default................................................ 44
ARTICLE VII
THE ADMINISTRATIVE AGENT
7.01. Authorization and Action......................................... 46
7.02. Administrative Agent's Reliance, Etc............................. 46
7.03. Societe Generale and Affiliates.................................. 47
7.04. Lender Party Credit Decision..................................... 47
7.05. Indemnification.................................................. 47
7.06. Successor Agents................................................. 47
ARTICLE VIII
MISCELLANEOUS
8.01. Amendments, Etc.................................................. 48
8.02. Notices, Etc..................................................... 48
8.03. No Waiver; Remedies.............................................. 49
8.04. Costs and Expenses............................................... 49
8.05. Right of Set-off................................................. 51
8.06. Binding Effect................................................... 51
8.07. Assignments and Participations................................... 51
8.08. Execution in Counterparts........................................ 53
8.09. Confidentiality.................................................. 53
8.10. No Reliance on Margin Stock...................................... 54
8.11. Jurisdiction, Etc................................................ 54
8.12. Governing Law.................................................... 54
8.13. Waiver of Jury Trial............................................. 54
4
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of January 30, 1998 among MARRIOTT
INTERNATIONAL, INC., a Delaware corporation, (to be renamed SODEXHO MARRIOTT
SERVICES, INC., the "Borrower"), the banks, financial institutions and other
institutional lenders listed on the signature pages hereof as the Initial
Lenders (the "Initial Lenders"), SOCIETE GENERALE ("Societe Generale"), as
administrative agent (together with any successor appointed pursuant to Article
VII, the "Administrative Agent") for the Lender Parties (as hereinafter
defined), and XXXXXX GUARANTY TRUST COMPANY OF NEW YORK ("Xxxxxx"), as the
documentation agent (the "Documentation Agent") for the Lender Parties, with
SOCIETE GENERALE and X.X. XXXXXX SECURITIES INC., as arrangers (the
"Arrangers").
PRELIMINARY STATEMENTS:
(1) Pursuant to the Transaction Documents (as hereinafter defined),
the Borrower will (i) distribute (the "Spinoff") to its shareholders all of its,
and its Subsidiaries' (as hereinafter defined), businesses other than the
Foodservice Business, (ii) the Guarantor (as hereinafter defined) will transfer
(the "Canadian Subsidiary Transfer") the shares of Sodexho Financiere du Canada,
Inc. ("Sodexho Canada"), its Canadian Subsidiary engaged in the food service and
facilities management business, to the Borrower, (iii) the Guarantor will pay
(the "Cash Payment") $304,000,000 to the Borrower, (iv) International Catering
Corporation, a Delaware corporation and a wholly owned indirect Subsidiary of
the Guarantor ("ICC"), will merge (the "Merger") with Merger Corp. (as
hereinafter defined), a newly formed, wholly owned Subsidiary of the Borrower,
with ICC being the surviving corporation and (v) the Guarantor will receive, as
consideration in respect of the Cash Payment, the Merger and the Canadian
Subsidiary Contribution, not less than 40.1% and not more than 49.9% of the
common stock of the Borrower.
(2) Sodexho Marriott Operations, Inc., a Delaware corporation
("Sodexho Operations"), has been organized as a wholly owned Subsidiary of the
Borrower in order to facilitate the transactions contemplated by the Transaction
Documents and to obtain the financing contemplated herein. At the time of the
Merger, the Borrower will contribute (the "Subsidiary Contribution") all of the
capital stock and other Investments (as hereinafter defined) held by the
Borrower in its Subsidiaries (other than Sodexho Canada, Marriott Corporation of
Canada, Ltd. ("MMS Canada"), New Marriott and Subsidiaries of New Marriott) to
Sodexho Operations. The Spinoff, the Canadian Subsidiary Contribution, the Cash
Payment, the Merger and the Subsidiary Contribution are herein referred to,
collectively, as the "Transaction".
(3) The Borrower has requested that, in connection with the
Transaction, the Lender Parties lend to it up to $620,000,000 to refinance
certain Existing Debt (as hereinafter defined) of the Borrower and ICC and their
respective Subsidiaries and to pay transaction fees and expenses. The Lender
Parties have indicated their willingness to agree to lend such amount on the
terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
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"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent with Societe
Generale at its office at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
ABA No. 000000000, Attention: Sodexho Marriott Services (A/C #9042806).
"Advance" has the meaning specified in Section 2.01.
"Affiliate" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 10% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or otherwise;
provided that, from and after the consummation of the Transaction, none of the
Borrower or any of its Subsidiaries shall be an Affiliate of New Marriott or any
of its Subsidiaries or Affiliates unless New Marriott or any of its Subsidiaries
or Affiliates purchases or otherwise acquires more than 10% of the Voting Stock
of the Borrower or any of its Subsidiaries after the date hereof.
"Amendment Agreement" means the Amendment Agreement dated as of
January 28, 1998 among the Borrower, the Guarantor, Merger Corp., New Marriott
and ICC.
"Applicable Lending Office" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of a Base Rate
Advance and such Lender Party's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
"Applicable Margin" means, with respect to Eurodollar Rate Advances
(i) on any day during the 12-month period commencing on the Funding Date (as
hereinafter defined), 0.45% per annum, and (ii) on any day thereafter, the
percentage per annum set forth below corresponding to (A) the rating issued on
or most recently prior to such day by S&P for the Guarantor's senior unsecured
long-term debt or, if such rating is unavailable, the rating assigned by S&P to
the Guarantor's unsecured "implied senior debt" or the "corporate credit rating"
(as the case may be), as notified in writing to the Guarantor by S&P, or (B) if
no such rating is available from S&P, the rating issued on or most recently
prior to such day by Xxxxx'x for the Guarantor's senior unsecured long-term debt
or, if such rating is unavailable, the rating assigned by Xxxxx'x to the
Guarantor's unsecured "implied senior debt", as notified in writing to the
Guarantor by Xxxxx'x. If no such rating is available from S&P or Xxxxx'x, the
Applicable Margin for such day shall be at Level 1.
=======================================
S&P/Xxxxx'x Credit Rating Percentage
------------------------- ----------
Level 5
-------
A-/A3 or greater 0.35%
--------------------------------------
Xxxxx 0
-------
BBB+/Baa1 0.45%
--------------------------------------
Level 3
-------
BBB/Baa2 0.625%
--------------------------------------
Level 2
-------
BBB-/Baa3 0.875%
--------------------------------------
Level 1
-------
BB+/Ba1 or less 1.125%
=======================================
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"Arrangers" has the meaning specified in the recital of parties to
this Agreement.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in accordance with Section 8.07 and in substantially the
form of Exhibit C hereto.
"Base Rate" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to the
higher of:
(a) the rate of interest announced publicly by Societe
Generale in New York, New York, from time to time, as Societe
Generale's prime rate; and
(b) 1/2 of one percent per annum above the Federal Funds Rate.
"Base Rate Advance" means an Advance that bears interest at the Base
Rate pursuant to the applicable Notice of Borrowing, the applicable Notice of
Interest Rate Election, Section 2.09(c) or Section 2.16.
"Base Transaction Documents" has the meaning specified in Section
3.02(a).
"Borrower" has the meaning specified in the recital of parties to
this Agreement.
"Borrower's Account" means the account of the Borrower maintained by
the Borrower with Societe Generale at its office at 1221 Avenue of the Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Account No. 0000000.
"Borrowing" means a borrowing consisting of simultaneous Advances
made by the Lenders on the Funding Date.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings in U.S.
dollar deposits are carried on in the London interbank market.
"Canadian Subsidiary Transfer" has the meaning specified in
Preliminary Statement (1).
"Capitalized Leases" means all leases that have been or should be,
in accordance with GAAP, recorded as capitalized leases.
"Cash Payment" has the meaning specified in Preliminary Statement
(1).
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"Closing Date" means the date on which all conditions precedent set
forth in Section 3.01 shall have been satisfied, but in no event later than
January 30, 1998.
"Commitment" means, with respect to any Lender at any time, the
amount set forth opposite such Lender's name on Schedule I hereto under the
caption "Commitment" or, if such Lender has entered into one or more Assignments
and Acceptances, set forth for such Lender in the Register maintained by the
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Administrative Agent pursuant to Section 8.07(d) as such Lender's "Commitment,"
as such amount may be reduced at or prior to such time pursuant to Section 2.04.
"Confidential Information" means any information that the Guarantor,
the Borrower or any of their respective Subsidiaries, Affiliates, advisors or
agents furnishes to the Administrative Agent or any Lender Party other than any
such information that is or becomes generally available to the public or that is
or becomes available to the Administrative Agent or such Lender Party from a
source other than the Guarantor, the Borrower or any of their respective
Subsidiaries, Affiliates, advisors or agents that is not, to the best of the
Administrative Agent's or such Lender Party's knowledge, acting in violation of
a confidentiality agreement with the Guarantor, the Borrower or any of their
respective Subsidiaries, Affiliates, advisors or agents.
"Consents Side Letter" means the letter dated as of October 2, 1997
among the Borrower, the Guarantor, Merger Corp., New Marriott and ICC.
"Consolidated" refers to the consolidation of accounts in accordance
with GAAP.
"Consolidated Debt" means, on any date, Debt of the Borrower and its
Subsidiaries on such date (other than Debt referred to in clause (i) of the
definition of "Debt"), determined on a Consolidated basis.
"Consolidated Interest Expense" means, for any period, Consolidated
interest expense of the Borrower and its Subsidiaries for such period (excluding
any such amounts not payable on a current basis in cash and any amounts
attributable to the amortization of deferred financing costs or other
capitalized fees or expenses paid prior to the Funding Date or incurred in
connection with the Transaction, the prepayment of any Marriott Bonds or the
incurrence of the Senior Debt or any Debt hereunder), net of Consolidated
interest income of the Borrower and its Subsidiaries for such period.
"Contingent Obligation" of any Person means any obligation,
contingent or otherwise, of such Person directly or indirectly guaranteeing any
Debt of any other Person and, without limiting the generality of the foregoing,
any obligation, direct or indirect, contingent or otherwise, of such Person (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt (whether arising by virtue of partnership arrangements, by virtue of
an agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise), (ii)
to reimburse a bank for amounts drawn under a letter of credit for the purpose
of paying such Debt or (iii) entered into for the purpose of assuring in any
other manner the holder of such Debt of the payment thereof or to protect such
holder against loss in respect thereof (in whole or in part), provided that the
term "Contingent Obligation" shall not include endorsements for collection or
deposit in the ordinary course of business.
"Conversion", "Convert" and "Converted" each refer to a conversion
of Advances of one Type into Advances of the other Type pursuant to Section 2.08
or 2.09.
"Debt" of any Person means, at any date, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (c)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (d) all obligations of such Person as lessee which are capitalized in
accordance with GAAP, (e) all obligations, contingent or otherwise, of such
Person to reimburse any bank or other Person in respect of a letter of credit or
similar instrument, (f) all Debt secured by a Lien on any asset of such Person,
whether or not such Debt is otherwise an obligation of such Person, (g) all
Contingent Obligations of such Person in respect of Debt of another Person (each
such Contingent Obligation to constitute Debt in an amount equal to the lesser
of the amount of such other Person's Debt subject to such Contingent Obligation
and the maximum amount payable
8
under such Contingent Obligation), (h) all obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any Hybrid Capital Stock of such Person or any other Person, valued, in the case
of Redeemable Hybrid Capital Stock, at the greater of its voluntary or
involuntary liquidation preference, and (i) all obligations in respect of Hedge
Agreements.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.
"Defaulted Advance" means, with respect to any Lender Party at any
time, the portion of any Advance required to be made by such Lender Party to the
Borrower pursuant to Section 2.01 or 2.02 at or prior to such time which has not
been made by such Lender Party or by the Administrative Agent for the account of
such Lender Party pursuant to Section 2.02(d) as of such time. In the event that
a portion of a Defaulted Advance shall be deemed made pursuant to Section
2.14(a), the remaining portion of such Defaulted Advance shall continue to be
considered a Defaulted Advance.
"Defaulted Amount" means, with respect to any Lender Party at any
time, any amount required to be paid by such Lender Party to the Administrative
Agent or any other Lender Party hereunder or under any other Loan Document at or
prior to such time which has not been so paid as of such time, including,
without limitation, any amount required to be paid by such Lender Party to (a)
the Administrative Agent pursuant to Section 2.02(d) to reimburse the
Administrative Agent for the amount of any Advance made by the Administrative
Agent for the account of such Lender Party, (b) any other Lender Party pursuant
to Section 2.12 to purchase any participation in Advances owing to such other
Lender Party and (c) the Administrative Agent pursuant to Section 7.05 to
reimburse the Administrative Agent for such Lender Party's ratable share of any
amount required to be paid by the Lender Parties to the Administrative Agent as
provided therein. In the event that a portion of a Defaulted Amount shall be
deemed paid pursuant to Section 2.14(b), the remaining portion of such Defaulted
Amount shall continue to be considered a Defaulted Amount.
"Defaulting Lender" means, at any time, any Lender Party that, at
such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall take
any action or be the subject of any action or proceeding of a type described in
Section 6.01(e).
"Disclosed Litigation" has the meaning specified in Section 3.02(j).
"Distribution Agreement" means the Distribution Agreement dated as
of September 30, 1997 between the Borrower and New Marriott, as amended by the
Amendment Agreement.
"Domestic Lending Office" means, with respect to any Lender Party,
the office of such Lender Party specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
pursuant to which it became a Lender Party, as the case may be, or such other
office of such Lender Party as such Lender Party may from time to time specify
to the Borrower and the Administrative Agent.
"EBITDA" means, for any period (a) Consolidated net income (or net
loss) of the Borrower and its Subsidiaries for such period (after eliminating
the effect of any non-Foodservice Business discontinued operations incurred
during the period prior to the Funding Date or to be allocated to New Marriott
as contemplated by the Distribution Agreement) plus (b) the sum of each of the
following items to the extent deducted in determining such Consolidated net
income: (i) interest expense for such period less interest income for such
period, (ii) net income tax expense for such period, (iii) depreciation expense
for such period, (iv) amortization expense for such period, (v) Integration
Costs deducted for such period in an amount not to exceed, in aggregate for all
such deductions taken over the term of the Facility, $45,000,000 less the amount
of such costs classified by the Borrower's independent public accountants, and
recorded, as
9
capitalized expenses, (vi) the net amount of (A) extraordinary non-cash losses
for such period less (B) extraordinary non-cash gains, for such period, (vii)
non-cash non-recurring items for such period and (viii) other non-cash items for
such period, in each case determined on a Consolidated basis and in accordance
with GAAP for such period.
"Eligible Assignee" means (i) a Lender; (ii) a financial institution
or other entity engaged in the financing of loans and accounts which is an
Affiliate of a Lender; and (iii) any other Person approved by the Administrative
Agent and, unless an Event of Default shall have occurred and be continuing, the
Borrower, such approval not to be unreasonably withheld or delayed; provided,
however, that neither any Loan Party nor any Affiliate of a Loan Party shall
qualify as an Eligible Assignee under this definition.
"Environmental Action" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of liability or
potential liability, investigation, proceeding, consent order or consent
agreement relating in any way to any Environmental Law, any Environmental Permit
or Hazardous Material or arising from alleged injury to the environment,
including, without limitation, (a) by any governmental or regulatory authority
for enforcement, cleanup, removal, response, remedial or other actions or
damages and (b) by any governmental or regulatory authority or third party for
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief.
"Environmental Law" means any applicable federal, state, local or
foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, or the effect of the
environment on human health or safety, including, without limitation, those
relating to the use, handling, transportation, treatment, storage, disposal,
release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of the Borrower, or under common
control with the Borrower, within the meaning of Section 414 of the Internal
Revenue Code.
"ERISA Event" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event has been waived by the
PBGC, or (ii) the requirements of subsection (1) of Section 4043(b) of ERISA
(taking into account subsection (2) of such Section) are met with respect to a
contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and
an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c)
of ERISA is reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver with respect
to a Plan; (c) the provision by the administrator of any Plan of a notice of
intent to terminate such Plan, pursuant to Section 4041(a)(2) of ERISA in a
distress termination pursuant to ERISA Section 4041(c) (including any such
notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or any
ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e)
the withdrawal by the Borrower or any ERISA Affiliate from a Multiple Employer
Plan during a plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under
Section 302(f) of ERISA shall have been met with respect to any Plan; (g) the
adoption of an amendment to a Plan requiring the provision of security to such
Plan pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of
proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in
10
Section 4042 of ERISA that constitutes grounds for the termination of, or the
appointment of a trustee to administer, such Plan.
"Eurocurrency Liabilities" has the meaning specified in Regulation D
of the Board of Governors of the Federal Reserve System, as in effect from time
to time.
"Eurodollar Lending Office" means, with respect to any Lender Party,
the office of such Lender Party specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
pursuant to which it became a Lender Party (or, if no such office is specified,
its Domestic Lending Office), or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"Eurodollar Rate" means, for any Interest Period, an interest rate
per annum equal to the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in U.S. dollars at 11:00 A.M.
(London time) two Business Days before the first day of such Interest Period in
an amount substantially equal to Societe Generale's Eurodollar Rate Advance to
which such Interest Period is to apply (or, if Societe Generale shall not have
such a Eurodollar Rate Advance, $1,000,000) and for a period equal to such
Interest Period (provided that if for any reason such rate is not available, the
term "Eurodollar Rate" shall mean, for any Interest Period, the rate per annum
(rounded upward, if necessary, to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in U.S.
dollars at approximately 11:00 A.M. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates;
provided further that, in the case of the initial Interest Period with respect
to any Advance, if such period is not an exact period of 1, 2 ,3, 6, 9 or 12
months, the Eurodollar Rate shall mean the interest rate per annum determined by
the Administrative Agent to be the arithmetic mean (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates at which deposits in U.S.
dollars approximately equal in principal amount to the Advances of the
Eurodollar Reference Banks, in their capacities as Lenders, included in such
initial Advance and for a maturity comparable to such Interest Period are
offered to the principal London offices of each of the Eurodollar Reference
Banks in immediately available funds in the London interbank market as of 11:00
A.M. (London time) on the day that is two Business Days prior to the first day
of such Interest Period.
"Eurodollar Rate Advance" means an Advance that bears interest at a
rate based on a Eurodollar Rate pursuant to the applicable Notice of Borrowing
or Notice of Interest Period Election.
"Eurodollar Rate Reserve Percentage" means for any day, the
percentage which is in effect on such day under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any successor)
for determining the maximum reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve requirement) for a member
bank of the Federal Reserve System in New York City with respect to liabilities
consisting of or including Eurocurrency Liabilities (or with respect to any
other category of liabilities that includes deposits by reference to which the
interest rate on Eurodollar Rate Advances is determined).
"Eurodollar Reference Banks" means the principal London office of
each of Societe Generale, Xxxxxx, Citibank, N.A., or such other Lender or
Lenders as from time to time may be agreed upon between the Borrower and the
Administrative Agent.
"Events of Default" has the meaning specified in Section 6.01.
"Existing Debt" has the meaning specified in Section 4.01(x).
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"Facility" means the facility provided by the Lenders hereunder for
the making of Advances to the Borrower as provided herein.
"Federal Funds Rate" means, for any day, the 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
next preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the average of
the quotations for such day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"Fiscal Quarter" has the meaning specified in Section 1.03(b).
"Fiscal Year" means the fiscal accounting period of 52 or 53 weeks
of the Borrower and its Consolidated Subsidiaries ending closest to December 31
or, if the Borrower changes its fiscal year end to "August 31", closest to
August 31 in any calendar year.
"Foodservice Business" means the businesses conducted by the
Borrower and its Affiliates which consist of (i) providing food and facilities
management services to businesses and industrial operations, health care
facilities, schools and universities, (ii) providing commercial laundry
services, (iii) managing the Retained Conference Centers (as defined in the
Distribution Agreement) and (iv) business undertaken pursuant to the NANA Joint
Ventures (as defined in the Distribution Agreement), each of the foregoing as
and to the extent conducted through the Borrower's Marriott Management Services
strategic business unit (referred to in the Distribution Agreement).
"Funding Date" means the date on which the Borrowing occurs
following satisfaction of all of the conditions precedent set forth in Section
3.02 but in no event later than June 30, 1998.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States, applied on a basis consistent (except
for changes concurred in by the Borrower's independent public accountants) with
the most recent audited consolidated financial statements of the Borrower and
its Consolidated Subsidiaries delivered to the Lenders.
"Group of Advances" means, at any time, a group of Advances
consisting of (i) all Advances which are Base Rate Advances at such time, (ii)
all Eurodollar Rate Advances having the same Interest Period at such time,
provided that, if an Advance of any particular Lender is Converted to or made as
a Base Rate Advance pursuant to Section 2.09 or 2.16, such Advance shall be
included in the same Group or Groups of Advances from time to time as it would
have been in if it had not been so Converted or made.
"Guaranty" means the Guaranty specified in Section 3.02(k)(xv).
"Guarantor" means Sodexho Alliance, S.A., a societe anonyme
organized under the laws of France, and its successors.
"Hazardous Materials" means (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biphenyls and radon gas and (b) any other chemicals,
materials or substances designated, classified or regulated as hazardous or
toxic or as a pollutant or contaminant under any Environmental Law.
12
"Hedge Agreements" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap agreements,
currency future or option contracts and other similar agreements.
"Hybrid Capital Stock" means, with respect to any Person, capital
stock of such Person, the dividends in respect of which are deductible by such
Person for United States federal income tax purposes.
"ICC" has the meaning specified in Preliminary Statement (1).
"Indemnified Consent Exposure" means the exposure resulting from the
absence of certain third-party consents and approvals required with respect to
the Transaction that is indemnified by New Marriott pursuant to the Distribution
Agreement.
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Indemnity Support Agreement" means the Indemnity Support Agreement
referred to in the Consents Side Letter, between the Borrower and New Marriott
in connection with the indemnification of the Borrower for the Indemnified
Consent Exposure.
"Information Memorandum" means the information memorandum dated
December, 1997 used by the Arrangers in connection with the syndication of the
Commitments.
"Initial Lenders" has the meaning specified in the recital of
parties to this Agreement.
"Insufficiency" means, with respect to any Plan, the amount, if any,
of its unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA.
"Integration Costs" means costs incurred in connection with the
combination of the businesses of Marriott Management Services Corp., a New York
corporation, ICC, Sodexho Canada, MMS Canada and their respective Subsidiaries
and Affiliates.
"Interest Period" means, for each Eurodollar Rate Advance, the
period commencing on the date of borrowing specified in the applicable Notice of
Borrowing or the date specified in the applicable Notice of Interest Rate
Election and ending one, two, three, six, or, to the extent available to each
Lender, nine or twelve months thereafter, as the Borrower may elect in such
Notice; provided, however, that:
(a) the first Interest Period in respect of any Advances that
are Eurodollar Rate Advances shall end on the last Business Day of
the first, second, third, sixth or, to the extent available to each
Lender, ninth or twelfth, calendar month after the month in which
such Advance was made, as elected by the Borrower in the applicable
Notice of Borrowing;
(b) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next
succeeding Business Day, provided, however, that, if such extension
would cause the last day of such Interest Period to occur in the
next following calendar month, the last day of such Interest Period
shall occur on the next preceding Business Day; and
(c) whenever the first day of any Interest Period occurs on
the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months equal
to the
13
number of months in such Interest Period), such Interest Period
shall end on the last Business Day of such succeeding calendar
month.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"Investment" in any Person means any loan or advance to such Person,
any purchase or other acquisition of any capital stock or other ownership or
profit interest, warrants, rights, options, obligations or other securities of
such Person, any capital contribution to such Person or any other investment in
such Person, including, without limitation, any arrangement pursuant to which
the investor incurs Debt of the types referred to in clause (f) or (g) of the
definition of "Debt" in respect of such Person, but excluding any demand deposit
maintained with any Person.
"Lender Party" means any Lender.
"Lenders" means the Initial Lenders and each Person that shall
become a Lender hereunder pursuant to Section 8.07.
"Leverage Ratio" means, as of the last day of any Fiscal Quarter of
the Borrower, the ratio of Consolidated Debt as at such day to Consolidated
EBITDA for the period of four consecutive Fiscal Quarters of the Borrower ending
on such day.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on title
to real property.
"Loan Documents" means this Agreement, the Notes, the Guaranty and
the agreement related to the fees referred to in Section 2.07, in each case as
amended or otherwise modified from time to time.
"Loan Parties" means the Borrower and the Guarantor.
"XXXXx" means the Liquid Yield Option Notes due 2011 of the Borrower
issued pursuant to the Indenture dated as of March 25, 1996 between the Borrower
and The Bank of New York, as indenture trustee, together with all supplemental
indentures executed thereunder.
"XXXXx Allocation Agreement" means the XXXXx Allocation Agreement to
be entered into by the Borrower, New Marriott and the Guarantor, substantially
in the form of the draft dated December 8, 1997.
"Margin Stock" has the meaning specified in Regulation U.
"Marriott Bond Tender Period" has the meaning specified in Section
2.01(a) of the Senior Debt Credit Agreement.
"Marriott Bonds" means (i) the notes in the principal amount of
$600,000,000 issued pursuant to the Indenture dated as of December 1, 1993
between the Borrower and Chemical Bank, as trustee, and (ii) the notes in the
principal amount of $120,000,000 issued pursuant to the Indenture dated as of
October 1, 1995 among RHG Finance, as issuer, Renaissance Hotel Group N.V., as
guarantor, the Borrower, as additional guarantor, and the First National Bank of
Chicago, as indenture trustee, in each case, as amended from time to time.
14
"Material Adverse Change" means any material adverse change in the
business, financial condition, results of operations or prospects of the
Borrower and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, financial condition, results of operations or prospects of the
Borrower and its Subsidiaries taken as a whole, (b) the rights and remedies of
the Administrative Agent and the Lenders under any Loan Document or (c) the
ability of any Loan Party to perform its Obligations under any Loan Document to
which it is or is to be a party.
"Material Contract" means, with respect to any Person, each contract
to which such Person is a party involving aggregate consideration payable to or
by such Person of an amount equal to not less than 2% of Consolidated sales of
the Borrower and its Subsidiaries in any year or otherwise material to the
business, financial condition or results of operations of such Person.
"Merger" has the meaning specified in Preliminary Statement (1).
"Merger Agreement" means the Agreement and Plan of Merger dated as
of September 30, 1997 among the Borrower, the Guarantor, Merger Corp., New
Marriott and ICC as amended by the Amendment Agreement.
"Merger Corp." means Marriott-ICC Merger Corp., a Delaware
corporation.
"MMS Canada" has the meaning specified in Preliminary Statement (2).
"Moody's" means Xxxxx'x Investors Service, Inc.
"Xxxxxx" has the meaning specified in the recital of parties to this
Agreement.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA which is a defined benefit plan within the meaning
of Section 3(35) of ERISA, to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and at least one Person other than the Borrower
and the ERISA Affiliates or (b) was so maintained and in respect of which the
Borrower or any ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA in the event such plan has been or were to be terminated.
"New Marriott" means New Marriott MI, Inc., a Delaware corporation
(to be renamed Marriott International, Inc. after the Spinoff).
"Note" means a promissory note of the Borrower payable to the order
of any Lender, in substantially the form of Exhibit A hereto, evidencing the
indebtedness of the Borrower to such Lender resulting from the Advance made by
such Lender.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Interest Rate Election" has the meaning specified in
Section 2.08.
"NPL" means the National Priorities List under CERCLA.
15
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including, without
limitation, any liability of such Person on any claim, whether or not the right
of any creditor to payment in respect of such claim is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed,
legal, equitable, secured or unsecured, and whether or not such claim is
discharged, stayed or otherwise affected by any proceeding referred to in
Section 6.01(f). Without limiting the generality of the foregoing, the
Obligations of the Loan Parties under the Loan Documents include (a) the
obligation to pay principal, interest, charges, expenses, fees, attorneys' fees
and disbursements, indemnities and other amounts payable by any Loan Party under
any Loan Document and (b) the obligation of any Loan Party to reimburse any
amount in respect of any of the foregoing that any Lender Party, in its sole
discretion, may elect to pay or advance on behalf of such Loan Party.
"Omnibus Restructuring Agreement" means the Omnibus Restructuring
Agreement dated as of September 30, 1997 among the Borrower, the Guarantor,
Merger Corp., New Marriott and ICC, as amended by the Amendment Agreement.
"Other Taxes" has the meaning specified in Section 2.11(b).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Permitted Liens" means each of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (a) Liens for taxes, assessments and governmental charges or
levies to the extent not required to be paid under Section 5.01(b) hereof; (b)
Liens imposed by law, such as materialmen's, mechanics', carriers', workmen's
and repairmen's Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than 30
days; (c) pledges or deposits to secure obligations under workers' compensation
laws or similar legislation or to secure public or statutory obligations; (d)
easements, rights of way and other encumbrances on title to real property that
do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use of such property for its present purposes;
(e) Liens in respect of judgments not constituting an Event of Default under
Section 6.01(g); and (f) Liens on inventory or equipment arising under Article 2
of the Uniform Commercial Code or any similar provision of applicable law
securing payment of the purchase price of such inventory or equipment, provided
that such Lien does not extend to any asset other than such inventory and
equipment and the obligation to pay such purchase price does not constitute
Debt, and provided further that neither the Borrower nor any of its Subsidiaries
shall have executed a Uniform Commercial Code financing statement (Form UCC-1 or
a comparable form) in connection with any such Lien on inventory.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Process Agent" has the meaning specified in Section 3.02(k)(xxii).
"Proxy Statement" means the Notice of Special Meeting of
Stockholders and related Preliminary Proxy Statement filed with the Securities
and Exchange Commission on January 12, 1998 by the Borrower and all related
documents, schedules, annexes and attachments filed therewith.
"Redeemable" means, with respect to any capital stock or other
ownership or profit interest, Debt or other right or Obligation, any such right
or Obligation that (a) the issuer has undertaken to redeem
16
at a fixed or determinable date or dates, whether by operation of a sinking fund
or otherwise, or upon the occurrence of a condition not solely within the
control of the issuer or (b) is redeemable at the option of the holder.
"Register" has the meaning specified in Section 8.07(d).
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Related Documents" means the Transaction Documents, the Senior Debt
Documents and the Tax Agreement.
"Required Lenders" means at any time Lenders owed or holding at
least 51% of the sum of (a) the aggregate principal amount of the Advances
outstanding at such time and (b) the aggregate unused Commitments under the
Facility at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time, there shall be excluded from the determination
of Required Lenders at such time (A) the aggregate principal amount of the
Advances owing to such Lender and outstanding at such time and (B) the unused
Commitment of such Lender at such time.
"Requisite Lenders" means at any time Lenders owed or holding at
least 662/3% of the sum of (a) the aggregate principal amount of the Advances
outstanding at such time and (b) the aggregate unused Commitments under the
Facility at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time, there shall be excluded from the determination
of Requisite Lenders at such time (A) the aggregate principal amount of the
Advances owing to such Lender and outstanding at such time and (B) the unused
Commitment of such Lender at such time.
"Responsible Officer" means, with respect to any Loan Party, any
executive officer of such Loan Party.
"Retained Marriott Bonds" means any Marriott Bonds that, on the last
day of the Marriott Bond Tender Period, shall not have been tendered and that
are retained as obligations of the Borrower.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Senior Debt" means the Debt under the Senior Debt Credit Agreement
or any replacement thereof.
"Senior Debt Credit Agreement" means the $735,000,000 Credit
Agreement dated as of the date hereof among Sodexho Operations, as borrower, the
Borrower, as Parent Guarantor, Xxxxxx and Societe Generale, as initial Issuing
Banks, the lenders party thereto, and Xxxxxx, as Documentation Agent and as
Administrative Agent (as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms).
"Senior Debt Documents" means the Senior Debt Credit Agreement,
together with the Notes, the Collateral Documents and the Guarantees (each as
defined therein) executed in connection therewith.
"Shareholders' Equity" means common stock, additional paid-in
capital, retained earnings and treasury stock of the Borrower and its
Subsidiaries on a Consolidated basis.
17
"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and no Person other than the Borrower and the
ERISA Affiliates or (b) was so maintained and in respect of which the Borrower
or any ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"Societe Generale" has the meaning specified in the recital of
parties to this Agreement.
"Sodexho Canada" has the meaning specified in Preliminary Statement
(1).
"Sodexho Operations" has the meaning specified in Preliminary
Statement (2).
"Solvent" and "Solvency" mean, with respect to any Person on a
particular date, that on such date (a) the fair value of the property of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person, (b) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (c) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person's ability to
pay such debts and liabilities as they mature and (d) such Person is not engaged
in business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute an unreasonably
small capital. The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"Spinoff" has the meaning specified in Preliminary Statement (1).
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than 50% of the issued and outstanding capital stock or other ownership
interests having ordinary voting power to elect a majority of the Board of
Directors or other persons performing similar functions (irrespective of whether
at the time capital stock or other ownership interests of any other class or
classes shall or might have voting power upon the occurrence of any contingency)
is at the time directly or indirectly owned or controlled by such Person, by
such Person and one or more of its other Subsidiaries or by one or more of such
Person's other Subsidiaries. Except as otherwise expressly provided herein,
neither New Marriott nor any Person that is, will be or will become a Subsidiary
of New Marriott upon the consummation of the Transaction shall be a Subsidiary
of the Borrower for any purpose under this Agreement.
"Subsidiary Contribution" has the meaning specified in Preliminary
Statement (2).
"Substantial Subsidiary" means, on any date, each Subsidiary of the
Borrower (i) whose revenues for the four Fiscal Quarters of the Borrower most
recently ended on or prior to such date equaled or exceeded 2% of the
Consolidated revenues of the Borrower and its Subsidiaries for such period or
(ii) whose assets as of such date equaled or exceeded 2% of the Consolidated
assets of the Borrower and its Subsidiaries as of such date.
"Tax Agreement" means the Tax Sharing and Indemnification Agreement
to be entered into by the Borrower, the Guarantor and New Marriott in respect of
certain tax matters in connection with the Transaction.
"Taxes" has the meaning specified in Section 2.11(a).
18
"Termination Date" means the earlier of (i) the seventh anniversary
of the Funding Date and (ii) the date of termination in whole of the Commitments
pursuant to Section 2.04 or 6.01.
"Transaction" has the meaning specified in Preliminary Statement
(2).
"Transaction Documents" means the Merger Agreement, the Distribution
Agreement, the Omnibus Restructuring Agreement, the Consents Side Letter and the
Indemnity Support Agreement (but only if and to the extent required to be
entered into pursuant to the Consents Side Letter).
"Type" refers to the distinction between Advances bearing interest
at the Base Rate and Advances bearing interest at a Eurodollar Rate.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for the election of directors
(or persons performing similar functions) of such Person, even if the right so
to vote has been suspended by the happening of such a contingency.
"Welfare Plan" means a welfare plan, as defined in Section 3(1) of
ERISA, that is maintained for employees of the Borrower or any of its
Subsidiaries or in respect of which the Borrower or any of its Subsidiaries
could have liability.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".
SECTION 1.03. Accounting Terms and Determinations. (a) Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP; provided that, if the Borrower notifies the Administrative
Agent that the Borrower wishes to amend any provision hereof to eliminate the
effect of any change in GAAP (or if the Administrative Agent notifies the
Borrower that the Required Lenders wish to amend any provision hereof for such
purpose), then such provision shall be applied on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such provision is amended in a manner satisfactory
to the Borrower and the Required Lenders.
(b) For all purposes of this Agreement, including the computation of
the financial covenants set forth in Section 5.04, the term "Fiscal Quarter"
with respect to the Borrower and its Subsidiaries shall mean the three-month
fiscal period of the Borrower or such Subsidiary ending nearest to the last day
of each November, February, May and August.
19
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Advances. Each Lender severally agrees, on the
terms and conditions hereinafter set forth, to make a single advance (an
"Advance") to the Borrower on the Funding Date in an amount not to exceed such
Lender's Commitment. The Borrowing shall consist of Advances made simultaneously
by the Lenders ratably according to their Commitments. Amounts borrowed under
this Section 2.01 and repaid or prepaid may not be reborrowed.
SECTION 2.02. Making the Advances. (a) The Borrowing shall be made
on notice, given not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed Borrowing in the case of any part
of the Borrowing consisting of Eurodollar Rate Advances, or 10:30 A.M. (New York
City time) on the date of the proposed Borrowing in the case of any part of the
Borrowing consisting of Base Rate Advances, by the Borrower to the
Administrative Agent, which shall give to each Lender prompt notice thereof by
telephone, confirmed immediately in writing, or by telecopier. Such notice of
Borrowing (the "Notice of Borrowing") shall be by telephone, confirmed
immediately in writing, or telecopier, in substantially the form of Exhibit B
hereto, specifying therein the requested (i) date of the Borrowing, (ii) Type of
Advances comprising the Borrowing, (iii) aggregate amount of the Borrowing and
(iv) in the case of any part of the Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Advance. Each Lender shall,
before 11:00 A.M. (New York City time) on the date of the Borrowing, make
available for the account of its Applicable Lending Office to the Administrative
Agent at the Administrative Agent's Account, in same day funds, such Lender's
ratable portion of the Borrowing in accordance with the Commitments of such
Lender and the other Lenders. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Administrative Agent will make such funds available to the Borrower by
crediting the Borrower's Account.
(b) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for
any Group of Advances if the aggregate amount of such Group of Advances is less
than $5,000,000 or if the obligation of the Lenders to make Eurodollar Rate
Advances shall then be suspended pursuant to Section 2.09(c) and (ii) the
Advances may not be outstanding as part of more than four separate Groups of
Advances.
(c) The Notice of Borrowing shall be irrevocable and binding on the
Borrower. In the case of any part of the Borrowing that the Notice of Borrowing
specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall,
within 15 days after demand, indemnify each Lender against any loss, cost or
expense (but excluding loss of margin for any day after the date specified in
the Notice of Borrowing for such Advance) incurred by such Lender as a result of
any failure to fulfill on or before the date specified in the Notice of
Borrowing for such Advance the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of the Borrowing
when such Advance, as a result of such failure, is not made on such date,
provided that such Lender shall have delivered to the Borrower a certificate
setting forth in reasonable detail the amount of, the basis for and the
calculation of, such loss, cost or expense, which certificate shall be
conclusive in the absence of manifest error.
(d) Unless the Administrative Agent shall have received notice from
a Lender prior to the date of the Borrowing that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of the
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of the Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made
20
such ratable portion available to the Administrative Agent, such Lender and the
Borrower severally agree to repay or pay to the Administrative Agent forthwith
on demand such corresponding amount and to pay interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid or paid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable at such time under Section 2.06 to
Advances comprising the Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. If such Lender shall pay to the Administrative Agent such
corresponding amount, such amount so paid shall constitute such Lender's Advance
as part of the Borrowing for all purposes.
(e) The failure of any Lender to make the Advance to be made by it
as part of the Borrowing shall not relieve any other Lender of its obligation,
if any, hereunder to make its Advance on the date of the Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
Advance to be made by such other Lender on the date of the Borrowing.
SECTION 2.03. Repayment of Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Lenders the aggregate
outstanding principal amount of the Advances on the seventh anniversary of the
Funding Date or on the date the Notes become due and payable pursuant to Section
6.01.
SECTION 2.04. Termination or Reduction of the Facility. (a)
Optional. The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part, the Commitments;
provided that each partial reduction of the Commitments (i) shall be in the
aggregate amount of $10,000,000 or an integral multiple of $5,000,000 in excess
thereof and (ii) shall be made ratably among the Lenders in accordance with
their Commitments.
(b) Mandatory. At the close of business on the Funding Date, the
Commitments shall be automatically and permanently reduced to zero.
SECTION 2.05. Prepayments. The Borrower may, upon same Business
Day's notice in the case of Base Rate Advances and three Business Days' notice
in the case of Eurodollar Rate Advances, in each case given to the
Administrative Agent not later than 11:00 A.M. (New York City time) stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Borrower shall, prepay the outstanding aggregate principal
amount of any Group of Advances in whole or ratably in part, together with
accrued interest to the date of such prepayment on the aggregate principal
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount of $10,000,000 or an integral multiple of
$5,000,000 in excess thereof and (y) if any prepayment of a Eurodollar Rate
Advance is made on a date other than the last day of an Interest Period for such
Advance the Borrower shall also pay any amounts owing pursuant to Section
8.04(c).
SECTION 2.06. Interest. (a) Scheduled Interest. The Borrower shall
pay interest on the unpaid principal amount of each Advance owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. For each day on which such Advance is a Base
Rate Advance, a rate per annum equal to the Base Rate for such day,
payable in arrears quarterly on the last day of each February, May, August
and November during such periods and on the date such Base Rate Advance
shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such Advance
is a Eurodollar Rate Advance, for each day during each Interest Period
applicable thereto a rate per annum equal to the sum of (A) the Eurodollar
Rate for such Interest Period plus (B) the Applicable Margin for such day,
payable in arrears on the last day of such Interest Period and, if such
Interest Period has a duration of more than three
21
months, on each day that occurs during such Interest Period every three
months from the first day of such Interest Period and on the date such
Eurodollar Rate Advance shall be Converted or paid in full.
(b) Default Interest. The Borrower shall pay interest on (i) the
unpaid principal amount of each Advance owing to each Lender that is not paid
when due and (ii) to the fullest extent permitted by law, the amount of any
interest, fee or other amount payable hereunder that is not paid when due, in
each case, from the date such amount shall be due until such amount shall be
paid in full, payable in arrears on the date such amount shall be paid in full
and on demand, at a rate per annum equal at all times to 2% per annum above the
rate per annum required to be paid, in the case of interest, on the Type of
Advance on which such interest has accrued pursuant to clause (a)(i) or (a)(ii)
above, and, in all other cases, on Base Rate Advances pursuant to clause (a)(i)
above.
(c) Notice of Interest Rate. Promptly after receipt of a Notice of
Borrowing or Notice of Interest Rate Election pursuant to Section 2.02(a) or
2.08(a), the Administrative Agent shall give notice to the Borrower and each
Lender of the applicable interest rate determined by the Administrative Agent
for purposes of clause (a)(i) or (a)(ii).
SECTION 2.07. Fees. (a) Ticking Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders a ticking fee payable in
arrears on the earlier of the Funding Date and the Termination Date and, in
addition, if neither the Funding Date nor the Termination Date has occurred
prior to such date, on April 30, 1998, (A) for the period commencing February
27, 1998 until the earliest of (i) the Funding Date, (ii) April 30, 1998 and
(iii) the Termination Date, at the rate of 25 basis points per annum (calculated
on the basis of a 360-day year) on the sum of the Commitments of each Lender
hereunder and (B) for the period commencing May 1, 1998 until the earlier of (i)
the Funding Date and (ii) the Termination Date, at the rate of 37.5 basis points
per annum (calculated on the basis of a 360-day year) on the sum of the
Commitments of each Lender hereunder; provided, however, that any ticking fee
accrued with respect to the Commitment of a Defaulting Lender during the period
prior to the time such Lender became a Defaulting Lender and unpaid at such time
shall not be payable by the Borrower to such Defaulting Lender so long as such
Lender shall be a Defaulting Lender except to the extent that such ticking fee
shall otherwise have been due and payable by the Borrower prior to such time;
and provided further that no ticking fee shall accrue on the Commitment of a
Defaulting Lender so long as such Lender shall be a Defaulting Lender.
(b) Administrative Agent's Fees. The Borrower shall pay to the
Administrative Agent for its own account such fees as may from time to time be
agreed between the Borrower and the Administrative Agent.
SECTION 2.08. Conversion and Continuation of Advances. (a) Optional.
The Borrower may on any Business Day, upon notice (a "Notice of Interest Rate
Election") given to the Administrative Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed
Conversion or continuation and subject to the provisions of Sections 2.06 and
2.09, Convert all or any portion of a Group of Advances into Advances of the
other Type or, in the case of a Group of Eurodollar Rate Advances, continue such
Advances as Eurodollar Rate Advances for an additional Interest Period;
provided, however, that any Conversion of Base Rate Advances into Eurodollar
Rate Advances, and any continuation of Eurodollar Rate Advances for an
additional Interest Period, shall be in an aggregate amount not less than the
minimum amount specified in Section 2.02(b), no Conversion of any Advances shall
result in more separate Groups of Advances than permitted under Section 2.02(b)
and each Conversion or continuation of less than all of the Advances in any
Group of Advances shall apply ratably to the Advances of the respective Lenders
included in such Group. Each such Notice of Interest Rate Election shall, within
the restrictions specified above, specify (i) the date of such Conversion or
continuation, (ii) the Advances to be Converted or continued and (iii) in the
case of any such continuation of or Conversion into Eurodollar Rate Advances,
the duration of the initial or next
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Interest Period for such Advances. Each Notice of Interest Rate Election
shall be irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Group of Eurodollar
Rate Advances shall be reduced, by prepayment or otherwise, to less than
$5,000,000, such Advances shall automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Group of Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Lenders,
whereupon each such Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance.
SECTION 2.09. Increased Costs, Etc. (a) If, due to either (i) the
introduction, after the date hereof, of or any change in or in the
interpretation of any law or regulation or (ii) the compliance with any
guideline or request issued after the date hereof from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or of making,
funding or maintaining Eurodollar Rate Advances (excluding for purposes of this
Section 2.09 any such increased costs resulting from (i) Taxes, Other Taxes or
taxes expressly excluded from the definition of Taxes and Other Taxes (as to
which Section 2.11 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision
thereof and (iii) any requirement as to which such Lender is entitled to
compensation under Section 2.15), then the Borrower shall from time to time,
within 15 days after demand by such Lender Party (with a copy of such demand to
the Administrative Agent), accompanied by a certificate of such Lender Party
setting forth in reasonable detail the amount of, the basis for and the
calculation of such additional amounts, pay to the Administrative Agent for the
account of such Lender Party additional amounts sufficient to compensate such
Lender Party for such increased cost; provided, however, that a Lender Party
claiming additional amounts under this Section 2.09(a) agrees to use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the amount of, such
increased cost that may thereafter accrue and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to such Lender
Party. A certificate as to the amount of such increased cost, submitted to the
Borrower by such Lender Party, shall be conclusive and binding for all purposes,
absent manifest error.
(b) If any Lender Party determines that the adoption, after the date
hereof, of any law or regulation or compliance with any guideline or request
issued after the date hereof from any central bank or other governmental
authority (whether or not having the force of law) regarding capital adequacy
affects or would affect the amount of capital required or expected to be
maintained by such Lender Party or any corporation controlling such Lender Party
and that the amount of such capital is increased by or based upon the existence
of such Lender Party's commitment to lend, then, upon demand by such Lender
Party (with a copy of such demand to the Administrative Agent), accompanied by a
certificate of such Lender Party setting forth in reasonable detail the amount
of, the basis for and the calculation of such additional amounts, the Borrower
shall pay to the Administrative Agent for the account of such Lender Party, from
time to time within 30 days after demand by such Lender Party, additional
amounts sufficient to compensate such Lender Party in the light of such
circumstances, for any reduction in the rate of return on capital of such Lender
or corporation controlling such Lender below the level that such Lender or
controlling corporation could have achieved but for such adoption or issuance
(taking into consideration its policies with respect to capital adequacy) to the
extent that such Lender Party reasonably determines such increase in capital to
be allocable to the existence of such Lender Party's commitment to lend. A
certificate as to such amounts submitted to the Borrower by such Lender Party
shall be conclusive and binding for all purposes, absent manifest error.
23
(c) If, with respect to any Eurodollar Rate Advances under the
Facility, the Required Lenders notify the Administrative Agent that the
Eurodollar Rate for any Interest Period for such Advances will not adequately
reflect the cost to such Lenders of making, funding or maintaining their
Eurodollar Rate Advances for such Interest Period, the Administrative Agent
shall forthwith so notify the Borrower and the Lenders, whereupon (i) each such
Eurodollar Rate Advance under the Facility will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance
and (ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the Borrower that such Lenders have determined that the circumstances
causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance under the
Facility made by such Lender will automatically, upon such demand, Convert into
a Base Rate Advance and (ii) the obligation of the Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower that such Lender has determined
that the circumstances causing such suspension no longer exist; provided,
however, that, before making any such demand, such Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.10. Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Notes, irrespective of any right of
counterclaim or set-off (except as otherwise provided in Section 2.14), not
later than 12:00 noon (New York City time) on the day when due in U.S. dollars
to the Administrative Agent at the Administrative Agent's Account in same day
funds. The Administrative Agent will promptly thereafter cause like funds to be
distributed (i) if such payment by the Borrower is in respect of principal,
interest, or any other Obligation then payable hereunder and under the Notes to
more than one Lender Party, to such Lender Parties for the account of their
respective Applicable Lending Offices ratably in accordance with the amounts of
such respective Obligations then payable to such Lender Parties and (ii) if such
payment by the Borrower is in respect of any Obligation then payable hereunder
to one Lender Party, to such Lender Party for the account of its Applicable
Lending Office, in each case to be applied in accordance with the terms of this
Agreement. Upon its acceptance of an Assignment and Acceptance and recording of
the information contained therein in the Register pursuant to Section 8.07(d),
from and after the effective date of such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) If the Administrative Agent receives funds for application to
the Obligations under the Loan Documents under circumstances in which neither
the Borrower nor the Loan Documents specify the Advances to which, or the manner
in which, such funds are to be applied, the Administrative Agent may, but shall
not be obligated to, elect to distribute such funds to each Lender Party ratably
in accordance with such Lender Party's proportionate share of the principal
amount of all outstanding Advances, in repayment or prepayment of such of the
outstanding Advances or other Obligations owed to such Lender Party, and for
application to such principal installments, as the Administrative Agent shall
direct.
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(c) All computations of interest based on the Base Rate shall be
made by the Administrative Agent on the basis of a year of 365 or 366 days, as
the case may be, and all computations of interest based on the Eurodollar Rate
and all computations of fees (including, without limitation, fees payable under
Section 2.07) shall be made by the Administrative Agent on the basis of a year
of 360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest or
fees are payable. Each determination by the Administrative Agent of an interest
rate or fee hereunder shall be conclusive and binding for all purposes, absent
manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest, fees or commissions,
as the case may be; provided, however, that, if such extension would cause
payment of interest on or principal of Eurodollar Rate Advances to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day.
(e) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to any Lender Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.11. Taxes. (a) Any and all payments by the Borrower
hereunder or under the Notes shall be made, in accordance with Section 2.10,
free and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of each Lender Party and the
Administrative Agent, taxes that are imposed on its overall net income by the
United States and taxes that are imposed on its overall net income (and
franchise and similar taxes imposed in lieu thereof) by the state or foreign
jurisdiction under the laws of which such Lender Party or the Administrative
Agent (as the case may be) is organized or in which it is resident or any
political subdivision thereof and, in the case of each Lender Party, taxes that
are imposed on its overall net income (and franchise and similar taxes imposed
in lieu thereof) by the state or foreign jurisdiction of such Lender Party's
Applicable Lending Office or any political subdivision thereof and in the case
of each Lender Party and the Administrative Agent, overall net income taxes
imposed solely by reason of such Lender Party or the Administrative Agent (as
the case may be) doing business in the jurisdiction imposing such tax, other
than taxes arising solely as a result of such Lender Party or the Administrative
Agent entering into this Agreement or holding any Note or performing any
activity contemplated herein (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments
hereunder or under the Notes being hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder or under any Note to any Lender Party or the
Administrative Agent, (i) the sum payable shall be increased as may be necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.11) such Lender Party or the
Administrative Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions and (iii) the Borrower shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law.
(b) In addition, the Borrower shall pay any present or future stamp,
documentary, excise, property or similar taxes, charges or levies that arise
from any payment made hereunder or under the Notes or
25
from the execution, delivery or registration of, performing under, or otherwise
with respect to, this Agreement or the Notes (hereinafter referred to as "Other
Taxes").
(c) The Borrower shall indemnify each Lender Party and the
Administrative Agent for and hold it harmless against the full amount of Taxes
and Other Taxes, and for the full amount of Taxes and Other Taxes on amounts
payable under this Section 2.11, imposed on or paid by such Lender Party or the
Administrative Agent (as the case may be) and any liability (including
penalties, additions to tax, interest and expenses) arising therefrom or with
respect thereto. This indemnification shall be made within 30 days from the date
such Lender Party or the Administrative Agent (as the case may be) makes written
demand therefor, accompanied by a certificate of such Lender Party setting forth
the amount thereof, the basis therefor and the calculation thereof; provided,
however, that the Borrower shall not be obligated to make payment to the Lender
Party or the Administrative Agent (as the case may be) pursuant to this Section
in respect of penalties, additions to tax, interest, expenses and other
liabilities attributable to any Taxes or Other Taxes, if (i) written demand
therefor has not been made by such Lender Party or the Administrative Agent
within 30 Business Days from the date on which such Lender Party or the
Administrative Agent received written notice of an imposition of Taxes or Other
Taxes by the relevant taxing or governmental authority (but only to the extent
that the Borrower is materially damaged as a result of such failure), (ii) such
penalties, additions to tax, interest, expenses and other liabilities have
accrued as a result of the failure of such Lender Party to remit the amount of
any indemnity payment it receives from the Borrower pursuant to this Section to
a taxing authority or (iii) such penalties, additions to tax, interest, expenses
and other liabilities are attributable to the gross negligence or willful
misconduct of such Lender Party or the Administrative Agent. After a Lender
Party or the Administrative Agent (as the case may be) receives notice of an
assessment of Taxes or Other Taxes, such Lender Party or Administrative Agent
will act in good faith to promptly notify the Borrower of its obligations
hereunder.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower shall furnish to the Administrative Agent, at its address referred to
in Section 8.02, the original or a certified copy of a receipt evidencing such
payment, except to the extent such receipt or other document is not legally
available, in which case the Borrower will furnish other satisfactory evidence
of such payment.
(e) Each Lender Party organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Initial Lender and on the date of
the Assignment and Acceptance pursuant to which it becomes a Lender Party in the
case of each other Lender Party, and from time to time thereafter as requested
in writing by the Borrower (but only so long thereafter as such Lender Party
remains lawfully able to do so), provide each of the Administrative Agent and
the Borrower with two original Internal Revenue Service forms 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Lender Party is exempt from or entitled to a reduced rate
of United States withholding tax on payments pursuant to this Agreement or the
Notes. If the forms provided by a Lender Party at the time such Lender Party
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender Party provides the
appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such form; provided, however, that, if at the date of the Assignment
and Acceptance pursuant to which a Lender Party assignee becomes a party to this
Agreement, the Lender Party assignor was entitled to payments under subsection
(a) in respect of United States withholding tax with respect to interest paid at
such date, then, to such extent, the term Taxes shall include (in addition to
withholding taxes that may be imposed in the future or other amounts otherwise
includable in Taxes) United States withholding tax, if any, applicable with
respect to the Lender Party assignee on such date.
(f) For any period with respect to which a Lender Party has failed
to provide the Borrower with the appropriate form described in subsection (e)
above (other than if such failure is due to a change in law occurring after the
date on which a form originally was required to be provided or if such form
26
otherwise is not required under subsection (e) above), such Lender Party shall
not be entitled to indemnification under subsection (a) or (c) with respect to
Taxes imposed by the United States by reason of such failure; provided, however,
that should a Lender Party become subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall take such steps as such
Lender Party shall reasonably request to assist such Lender Party to recover
such Taxes at such Lender Party's expense.
(g) If a Lender Party shall become aware that it is entitled to
receive a refund from a relevant taxing or governmental authority in respect of
Taxes or Other Taxes as to which it has been indemnified by the Borrower
pursuant to this Section, it shall promptly notify the Borrower of the
availability of such refund and shall, within 30 days after receipt of a request
by the Borrower (whether as a result of notification that it has made to the
Borrower or otherwise) make a claim to such taxing or governmental authority for
such refund at the Borrower's expense; provided that the Borrower agrees to
indemnify the Lender Party for any adverse tax consequences resulting from the
making of such claim for refund. If such Lender Party finally and irrevocably
receives a refund of any Taxes or Other Taxes (including penalties, additions to
tax and interest) for which it has been indemnified by the Borrower pursuant to
this Section, or which the Borrower has paid pursuant to this Section, then, to
the extent such Lender Party may do so without jeopardizing the right to such
refund or the right to benefit from any other refunds, credits, reliefs,
remissions or repayments to which it may be entitled, it shall promptly notify
the Borrower of such refund and shall within 30 days from the date of receipt of
such refund pay to the Borrower the portion of such refund (including the
after-tax amount of any interest paid by the relevant taxing or governmental
authority with respect to such refund) that the Lender Party determines would
leave such Lender Party in no worse position than if no Taxes or Other Taxes had
been imposed (but in no case shall such portion exceed the amount of the
indemnity payments made, or Taxes or Other Taxes (including penalties, additions
to tax, and interest) paid, by the Borrower under this Section that gave rise to
such refund), net of all out-of-pocket expenses of such Lender Party and without
interest, provided, however, that the Borrower, upon the request of such Lender
Party agrees to repay the amount paid over to the Borrower (plus penalties,
interest or other charges due to the appropriate authorities in connection
therewith) to such Lender Party in the event such Lender Party is required to
repay such refund to such relevant authority.
(h) Any Lender Party claiming any additional amounts payable
pursuant to this Section 2.11 agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office (or take such other actions as may
be reasonably requested by the Borrower) if the making of such a change or the
taking of such an action would avoid the need for, or reduce the amount of, any
such additional amounts that may thereafter accrue and would not, in the
reasonable judgment of such Lender Party, be disadvantageous to such Lender
Party; provided that the mere existence of quantifiable fees, charges, costs and
expenses that the Borrower has offered and agreed to pay on behalf of such
Lender Party shall not be deemed to be disadvantageous to such Lender Party.
SECTION 2.12. Sharing of Payments, Etc. If any Lender Party shall
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) (a) on account of Obligations
due and payable to such Lender Party hereunder and under the Notes at such time
in excess of its ratable share (according to the proportion of (i) the amount of
such Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time obtained by all the Lender Parties at such time or (b) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations owing to such Lender Party
hereunder and under the Notes at such time to (ii) the aggregate amount of the
Obligations owing (but not due and payable) to all Lender Parties hereunder and
under the Notes at such time) of payments on account of the Obligations owing
(but not due and payable) to all Lender Parties hereunder and under the Notes at
such time obtained by all of the Lender Parties at such time, such Lender Party
shall forthwith purchase from the other Lender Parties such participations in
the Obligations due and payable or owing
27
to them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender Party, such purchase from each other
Lender Party shall be rescinded and such other Lender Party shall repay to the
purchasing Lender Party the purchase price to the extent of such Lender Party's
ratable share (according to the proportion of (i) the purchase price paid to
such Lender Party to (ii) the aggregate purchase price paid to all Lender
Parties) of such recovery together with an amount equal to such Lender Party's
ratable share (according to the proportion of (i) the amount of such other
Lender Party's required repayment to (ii) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered. The
Borrower agrees that any Lender Party so purchasing a participation from another
Lender Party pursuant to this Section 2.12 may, to the fullest extent permitted
by law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender Party were the direct
creditor of the Borrower in the amount of such participation.
SECTION 2.13. Use of Proceeds. The proceeds of the Advances shall be
available (and the Borrower agrees that it shall use such proceeds) solely to
refinance certain Existing Debt of the Borrower, ICC and their respective
Subsidiaries, to make any required payment to New Marriott and to pay
transaction fees and expenses.
SECTION 2.14. Defaulting Lenders. (a) In the event that, at any
time, (i) any Lender Party shall be a Defaulting Lender, (ii) such Defaulting
Lender shall owe a Defaulted Advance to the Borrower and (iii) the Borrower
shall be required to make any payment hereunder or under any other Loan Document
to or for the account of such Defaulting Lender, then the Borrower may, so long
as no Event of Default shall have occurred and be continuing at such time and to
the fullest extent permitted by applicable law, set off and otherwise apply the
Obligation of the Borrower to make such payment to or for the account of such
Defaulting Lender against the obligation of such Defaulting Lender to make such
Defaulted Advance. In the event that, on any date, the Borrower shall so set off
and otherwise apply its obligation to make any such payment against the
obligation of such Defaulting Lender to make any such Defaulted Advance on or
prior to such date, the amount so set off and otherwise applied by the Borrower
shall constitute for all purposes of this Agreement and the other Loan Documents
an Advance by such Defaulting Lender made on the date of such set off under the
Facility pursuant to which such Defaulted Advance was originally required to
have been made pursuant to Section 2.01. Such Advance shall be considered, for
all purposes of this Agreement, (i) to comprise part of the Borrowing in
connection with which such Defaulted Advance was originally required to have
been made pursuant to Section 2.01 and (ii) to be of the same Type as, and to
bear interest at the rate applicable to, the Advances of the other Lenders
included in such Borrowing, which interest shall be payable on the dates upon
which interest is payable on such other Advances. The Borrower shall notify the
Administrative Agent at any time the Borrower exercises its right of set-off
pursuant to this subsection (a) and shall set forth in such notice (A) the name
of the Defaulting Lender and the Defaulted Advance required to be made by such
Defaulting Lender and (B) the amount set off and otherwise applied in respect of
such Defaulted Advance pursuant to this subsection (a). Any portion of such
payment otherwise required to be made by the Borrower to or for the account of
such Defaulting Lender which is paid by the Borrower, after giving effect to the
amount set off and otherwise applied by the Borrower pursuant to this subsection
(a), shall be applied by the Administrative Agent as specified in subsection (b)
or (c) of this Section 2.14.
(b) In the event that, at any time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount to
the Administrative Agent or any of the other Lender Parties and (iii) the
Borrower shall make any payment hereunder or under any other Loan Document to
the Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Lender
Parties and to the fullest extent permitted by applicable law, apply at such
time the amount so paid by the Borrower to or for the account of such Defaulting
Lender to the payment of each such Defaulted Amount to the extent required to
pay such Defaulted Amount. In the event that the
28
Administrative Agent shall so apply any such amount to the payment of any such
Defaulted Amount on any date, the amount so applied by the Administrative Agent
shall constitute for all purposes of this Agreement and the other Loan Documents
payment, to such extent, of such Defaulted Amount on such date. Any such amount
so applied by the Administrative Agent shall be retained by the Administrative
Agent or distributed by the Administrative Agent to such other Lender Parties,
ratably in accordance with the respective portions of such Defaulted Amounts
payable at such time to the Administrative Agent and such other Lender Parties
and, if the amount of such payment made by the Borrower shall at such time be
insufficient to pay all Defaulted Amounts owing at such time to the
Administrative Agent and the other Lender Parties, in the following order of
priority:
(i) first, to the Administrative Agent for any Defaulted Amount then
owing to the Administrative Agent; and
(ii) second, to any other Lender Parties for any Defaulted Amounts
then owing to such other Lender Parties, ratably in accordance with such
respective Defaulted Amounts then owing to such other Lender Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.14.
(c) In the event that, at any time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted Advance
or a Defaulted Amount and (iii) the Borrower, the Administrative Agent or any
other Lender Party shall be required to pay or distribute any amount hereunder
or under any other Loan Document to or for the account of such Defaulting
Lender, then the Borrower or such other Lender Party shall pay such amount to
the Administrative Agent to be held by the Administrative Agent, to the fullest
extent permitted by applicable law, in escrow or the Administrative Agent shall,
to the fullest extent permitted by applicable law, hold in escrow such amount
otherwise held by it. Any funds held by the Administrative Agent in escrow under
this subsection (c) shall be deposited by the Administrative Agent in an account
with Societe Generale, in the name and under the control of the Administrative
Agent, but subject to the provisions of this subsection (c). The terms
applicable to such account, including the rate of interest payable with respect
to the credit balance of such account from time to time, shall be Societe
Generale's standard terms applicable to escrow accounts maintained with it. Any
interest credited to such account from time to time shall be held by the
Administrative Agent in escrow under, and applied by the Administrative Agent
from time to time in accordance with the provisions of, this subsection (c). The
Administrative Agent shall, to the fullest extent permitted by applicable law,
apply all funds so held in escrow from time to time to the extent necessary to
make any Advances required to be made by such Defaulting Lender and to pay any
amount payable by such Defaulting Lender hereunder and under the other Loan
Documents to the Administrative Agent or any other Lender Party, as and when
such Advances or amounts are required to be made or paid and, if the amount so
held in escrow shall at any time be insufficient to make and pay all such
Advances and amounts required to be made or paid at such time, in the following
order of priority:
(i) first, to the Administrative Agent for any amount then due and
payable by such Defaulting Lender to the Administrative Agent hereunder;
(ii) second, to any other Lender Parties for any amount then due and
payable by such Defaulting Lender to such other Lender Parties hereunder,
ratably in accordance with such respective amounts then due and payable to
such other Lender Parties; and
(iii) third, to the Borrower for any Advance then required to be
made by such Defaulting Lender pursuant to a Commitment of such Defaulting
Lender.
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In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender Party to the Obligations owing to such Lender Party at such time under
this Agreement and the other Loan Documents ratably in accordance with the
respective amounts of such obligations outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under this
Section 2.14 are in addition to other rights and remedies that the Borrower may
have against such Defaulting Lender with respect to any Defaulted Advance and
that the Administrative Agent or any Lender Party may have against such
Defaulting Lender with respect to any Defaulted Amount.
SECTION 2.15. Regulation D Compensation. If and so long as a reserve
requirement of the type described in the definition of "Eurodollar Rate Reserve
Percentage" is prescribed by the Board of Governors of the Federal Reserve
System (or any successor), each Lender subject to such requirement may require
the Borrower to pay, contemporaneously with each payment of interest on each of
such Lender's Eurodollar Rate Advances, additional interest on such Eurodollar
Rate Advance at a rate per annum determined by such Lender up to but not
exceeding the excess of (i) (A) the applicable Eurodollar Rate divided by (B)
one minus the Eurodollar Rate Reserve Percentage over (ii) the applicable
Eurodollar Rate. Any Lender wishing to require payment of such additional
interest (x) shall so notify the Borrower and the Administrative Agent, in which
case such additional interest on the Eurodollar Rate Advances of such Lender
shall be payable to such Lender at the place indicated in such notice with
respect to each Interest Period commencing at least three Business Days after
such Lender gives such notice and (y) shall notify the Borrower at least five
Business Days before each date on which interest is payable on the Eurodollar
Rate Advances of the amount then due it under this Section.
SECTION 2.16. Base Rate Advances Substituted for Affected Eurodollar
Rate Advances. If (i) the obligation of any Lender to make, or to continue or
Convert outstanding Advances as or to, Eurodollar Rate Advances has been
suspended pursuant to Section 2.09(d) or (ii) any Lender has demanded
compensation under Section 2.09(a) or (b) or Section 2.11 with respect to its
Eurodollar Rate Advances, and in any such case the Borrower shall, by at least
five Business Days' prior notice to such Lender through the Administrative
Agent, have elected that the provisions of this Section shall apply to such
Lender, then, unless and until such Lender notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer exist, all Advances which would otherwise be made by such Lender as (or
continued as or Converted to) Eurodollar Rate Advances, shall instead be Base
Rate Advances on which interest and principal shall be payable contemporaneously
with the related Eurodollar Rate Advances of the other Lenders. If such Lender
notifies the Borrower that the circumstances giving rise to such suspension or
demand for compensation no longer exist, the principal amount of each such Base
Rate Advance shall be converted into a Eurodollar Rate Advance on the first day
of the next succeeding Interest Period applicable to the related Eurodollar Rate
Advances of the other Lenders.
SECTION 2.17. Replacement of Certain Lenders. If any Lender (a
"Subject Lender") (i) is a Defaulting Lender that owes a Defaulted Advance to
the Borrower, (ii) makes demand upon the Borrower for (or if the Borrower is
otherwise required to pay) amounts pursuant to Section 2.09(a) or (b) or Section
2.11 or (iii) gives notice pursuant to Section 2.09(d) requiring a conversion of
such Subject Lender's Eurodollar Rate Advances to Base Rate Advances or
suspending such Lender's obligation to make Advances as, or to Convert or
continue Advances into or as, Eurodollar Rate Advances, the Borrower may, within
90 days of receipt by the Borrower of such demand or notice (or the occurrence
of such other event causing the Borrower to be required to pay such
compensation), as the case may be, give notice (a "Replacement Notice") in
writing to the Administrative Agent and such Subject Lender of its intention to
replace such Subject Lender with a financial institution (a "Replacement
Lender") designated in such Replacement Notice. Unless the Administrative Agent
shall, in the exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice,
30
notify the Borrower and such Subject Lender in writing that the designated
financial institution is unsatisfactory to the Administrative Agent (such denial
not being available to the Administrative Agent where the Replacement Lender is
already a Lender), then such Subject Lender shall, subject to the payment of any
amounts due pursuant to Sections 2.09(a) and (b) and Section 2.11 assign, in
accordance with Section 8.07, all of its Commitments, Advances, Notes and other
rights and obligations under this Agreement and all other Loan Documents to such
designated financial institution; provided, however, that (i) such assignment
shall be without recourse, representation or warranty and (ii) the purchase
price paid by such designated financial institution shall be in at least the
amount of such Subject Lender's Advances, together with all accrued and unpaid
interest and fees in respect thereof, plus all other amounts (including the
amounts demanded and unreimbursed under Sections 2.09(a) and (b) and Section
2.11) owing to such Subject Lender hereunder. Upon the effective date of an
assignment described above, the Borrower shall issue a replacement Note or
Notes, as the case may be, to such designated financial institution or
Replacement Lender, as applicable, and such institution shall become a "Lender"
for all purposes under this Agreement and the other Loan Documents.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Closing. This Agreement shall
become effective on the date (the "Closing Date") that the following conditions
precedent are satisfied:
(a) The Administrative Agent shall have received, dated the Closing
Date, in form and substance satisfactory to the Arrangers and their legal
counsel, a copy of this Agreement duly executed by each party hereto, with
definitive forms of all exhibits hereto mutually satisfactory to the
Borrower and the Arrangers and their legal counsel;
(b) The Borrower shall have paid all accrued fees and reimbursable
expenses of the Arrangers (including the accrued reasonable fees and
expenses of counsel to the Arrangers) due on or before the Closing Date,
to the extent invoiced at least two Business Days prior to the Closing
Date; and
(c) The Senior Debt Credit Agreement shall have been duly executed
by each party thereto and delivered to the Administrative Agent.
SECTION 3.02. Conditions Precedent to Borrowing. The obligation of
each Lender to make an Advance on the Funding Date is subject to the
satisfaction of the following conditions precedent before or concurrently
therewith:
(a) The Spinoff, the Canadian Subsidiary Transfer, the Cash Payment
and the Merger shall have been consummated in accordance with the terms of
the Transaction Documents, without any written waiver or amendment not
consented to by the Requisite Lenders of any term, provision or condition
set forth therein, and in compliance with all applicable laws (it being
understood that the Consents Side Letter, the Distribution Agreement, the
Merger Agreement, the Omnibus Restructuring Agreement and related
documents delivered to the Arrangers prior to November 27, 1997, and as
amended through the date hereof pursuant to amendments provided to the
Lenders prior to the date hereof (the "Base Transaction Documents"), are
satisfactory to the Lender Parties and their legal counsel), and, if the
Hypothetical Consent Exposure Amount (as defined in the Consents Side
Letter) on the Funding Date exceeds $25,000,000, the arrangements as
contemplated by Section 1 of the Consents Side Letter and Exhibit B
thereto shall have been fully satisfied or other arrangements acceptable
to the Requisite Lenders shall have been put in place.
31
(b) The Subsidiary Contribution shall have been consummated in
accordance with the terms described on Schedule 3.02(b).
(c) The Transaction Documents shall be in full force and effect.
(d) The Lender Parties shall be reasonably satisfied with the
corporate and legal structure and capitalization of each Loan Party,
including the terms and conditions of the charter and bylaws (or other
similar organizational documents) and each class of capital stock of each
Loan Party and of each agreement or instrument relating to such structure
or capitalization, provided that the corporate and legal structure and
capitalization of the Loan Parties, to the extent specified in the
Information Memorandum or the Base Transaction Documents, are satisfactory
to the Lender Parties.
(e) Sodexho Operations shall have received not less than
$500,000,000 in gross cash proceeds of the Senior Debt.
(f) All Existing Debt identified as "To Be Refinanced" on Schedule
4.01(x) (other than any Retained Marriott Bonds) shall have been prepaid,
redeemed or defeased in full or otherwise satisfied and extinguished or
arrangements therefor satisfactory to the Administrative Agent shall have
been made (or, in the case of certain Marriott Bonds, assumed by New
Marriott).
(g) There shall have occurred no Material Adverse Change since
September 12, 1997.
(h) The Borrower shall have paid all accrued fees and expenses of
the Administrative Agent and the Lender Parties (including the fees and
expenses of counsel to the Administrative Agent) due on or before the
Funding Date, to the extent invoiced at least two Business Days prior to
the Funding Date.
(i) All governmental authorizations, and material consents,
approvals and authorizations of, and notices and filings to or with, and
other actions by, any other Person necessary in connection with the
Transaction, any of the Loan Documents or the Related Documents or any
transactions contemplated thereby, other than (i) filings and recordings
under, or with respect to the Collateral under and as defined in, the
Senior Debt Documents, (ii) governmental authorizations, and consents,
approvals, authorizations, notices, filings and other actions, described
on Schedule 4.01(d) hereto, (iii) third party consents and approvals that
have not been obtained that relate to Indemnified Consent Exposure and
(iv) consents, approvals, authorizations, notices, filings and other
actions the absence of which would not reasonably be expected to have a
Material Adverse Effect, shall have been obtained (without the imposition
of any conditions that are not reasonably acceptable to the Lender
Parties) and shall remain in full force and effect; and all applicable
waiting periods shall have expired without any action being taken by any
competent authority.
(j) There shall exist no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries pending or
threatened before any court, governmental agency or arbitrator that could
reasonably be expected to have a Material Adverse Effect other than the
matters described on Schedule 4.01(i) (the "Disclosed Litigation").
(k) The Administrative Agent shall have received on or before the
Funding Date the following, each dated such day (unless otherwise
specified), in form and substance satisfactory to the Administrative Agent
(unless otherwise specified) and (except for the Notes) in sufficient
copies for each Lender Party:
(i) The Notes payable to the order of the Lenders.
32
(ii) Certified copies of the resolutions of the Board of
Directors of the Borrower and the Guarantor approving the
Transaction, this Agreement, the Notes and each other Loan Document
to which it is or is to be a party (including, in the case of the
resolutions of the Board of Directors of the Guarantor, authorizing
and approving the issuance of the Guaranty), and of all documents
evidencing other necessary corporate action (including shareholder
approval) and governmental approvals and consents, if any, with
respect to the Transaction, this Agreement, the Notes, each other
Loan Document and each Related Document.
(iii) A copy of the charter of the Borrower and each amendment
thereto, certified (as of a date reasonably near the Funding Date)
by the Secretary of State of the jurisdiction of its incorporation
as being a true and correct copy thereof.
(iv) To the extent reasonably available, a copy of a
certificate of the Secretary of State of the jurisdiction of its
incorporation, dated reasonably near the Funding Date, listing the
charter of the Borrower and each amendment thereto on file in his
office and certifying that (A) such amendments are the only
amendments to the Borrower's charter on file in the office of such
Secretary of State, (B) the Borrower has paid all franchise taxes to
the date of such certificate and (C) the Borrower is duly
incorporated and in good standing under the laws of the jurisdiction
of its incorporation.
(v) A copy of a certificate of the Secretary of State of the
State of Delaware certifying as to the filing and acceptance of the
certificate of merger in respect of the Merger, or other
confirmation of such filing satisfactory to the Arrangers.
(vi) A certificate of the Borrower, signed on behalf of the
Borrower by any two of its chief executive officer, chief financial
officer, chief accounting officer, president, secretary, any vice
president or any assistant secretary, dated the Funding Date,
certifying as to (A) the absence of any amendments to the charter of
the Borrower since the date of the Secretary of State's certificate
referred to in Section 3.02(k)(iv), other than the filing of an
amendment to the certificate of incorporation of the Borrower, in
the form attached thereto, on the Funding Date, (B) a true and
correct copy of the bylaws of the Borrower as in effect on the
Funding Date, (C) the due incorporation and good standing of the
Borrower as a corporation organized under the laws of the
jurisdiction of its incorporation and the absence of any proceeding
for the dissolution or liquidation of the Borrower, (D) the truth of
the representations and warranties contained in the Loan Documents
as though made on and as of the Funding Date (other than any such
representation or warranty that is limited to a particular date or
dates, as to which the truth of such representation or warranty is
as of such date or dates) and (E) the absence of any Default at the
time of, or immediately after giving effect to, the Borrowing.
(vii) A certificate of the Guarantor, signed on behalf of the
Guarantor by the Secretary of the Board of the Guarantor, dated the
Funding Date, certifying as to (A) a true and correct copy of the
Statuts of the Guarantor as in effect on the Funding Date, (B) the
valid existence of the Guarantor as a societe anonyme organized
under the laws of the Republic of France and the absence of any
proceeding for the dissolution or liquidation of the Guarantor, (C)
a true and complete copy of a recent extract from the Commercial
Registry with respect to the Guarantor and (D) the absence of any
Guarantor Event of Default (as defined in the Guaranty) or any event
that would constitute a Guarantor Event of Default but for the
requirement that notice be given or time elapse or both.
(viii) A certificate of the Secretary or an Assistant
Secretary of the Borrower and the Guarantor certifying the names and
true signatures of the officers of the Borrower and the
33
Guarantor authorized to sign this Agreement, the Notes and each
other Loan Document to which they are or are to be parties and the
other documents to be delivered hereunder and thereunder.
(ix) Completed requests for information, dated on or before
the Funding Date, listing all effective financing statements filed
in the jurisdictions in which the assets or property of the Borrower
or any Substantial Subsidiary are located that name the Borrower or
any Substantial Subsidiary as debtor, together with copies of such
financing statements.
(x) Duly executed termination statements (Form UCC-3 or a
comparable form) or the equivalent thereof in suitable form for
filing under the Uniform Commercial Code of all jurisdictions that
may be necessary or that the Administrative Agent may reasonably
deem desirable in order to terminate or amend existing liens on the
assets or property of the Borrower and any Substantial Subsidiary
(other than liens and security interests permitted under the terms
of the Loan Documents and the Senior Debt Documents), duly executed
by the appropriate secured party.
(xi) A copy of a ruling issued by the Internal Revenue Service
to the effect that the Spinoff will qualify as a tax-free
reorganization under Section 368(a)(1)(D) of the Internal Revenue
Code and a tax-free distribution under Section 355 of the Internal
Revenue Code to the holders of the stock of the Borrower.
(xii) Satisfaction of the Lender Parties and counsel for the
Administrative Agent with respect to the tax treatment of the
Borrower's debt as debt and not equity and the deductibility of
interest thereunder.
(xiii) Evidence that the Guarantor owns, directly or
indirectly, not less than 40.01% of the voting stock of the
Borrower.
(xiv) A copy of the fairness opinion with respect to the
Transaction issued to the Board of Directors of the Borrower by
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated.
(xv) A guaranty in substantially the form of Exhibit D (as
amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "Guaranty"), duly executed by the
Guarantor.
(xvi) Certified copies of each of the Related Documents, duly
executed by the parties thereto and in form and substance
satisfactory to the Lender Parties (it being understood that the
Base Transaction Documents are satisfactory to the Lender Parties
and their legal counsel), together with all agreements, instruments
and other documents delivered in connection therewith.
(xvii) Certified copies of each contract with the Guarantor
listed on Schedule 4.01(z), duly executed by the parties thereto.
(xviii) A copy of the solvency opinion with respect to the
Borrower after giving effect to the Transaction and the other
transactions contemplated hereby, from American Appraisal
Associates, Inc.
(xix) Evidence of insurance complying with the provisions of
Section 5.01(d).
34
(xx) An unaudited pro forma balance sheet of the Guarantor as
of August 31, 1997 as if the Transaction had been consummated on
such date.
(xxi) A duly completed and executed Notice of Borrowing for
the Borrowing.
(xxii) A letter from Corporation Service Company, presently
located at 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, consenting
to its appointment by the Guarantor as its agent for service of
process (the "Process Agent"), without reservation, until at least
one (1) year after the Termination Date, together with evidence of
the payment in full of all fees thereof.
(xxiii) An opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the
Borrower and the Guarantor, in substantially the form of Exhibit E-1
hereto and as to such other matters as the Required Lenders through
the Administrative Agent may reasonably request.
(xxiv) An opinion of Xxxxxx X. Xxxxx, Esq., General Counsel
for the Borrower, in substantially the form of Exhibit E-2 hereto
and as to such other matters as the Required Lenders through the
Administrative Agent may reasonably request.
(xxv) An opinion of Xxxxxxxxx and May, French counsel for the
Guarantor, in substantially the form of Exhibit E-3 hereto and as to
such other matters as the Required Lenders through the
Administrative Agent may reasonably request.
(xxvi) A favorable opinion of Shearman & Sterling, counsel for
the Administrative Agent, in form and substance satisfactory to the
Administrative Agent.
(l) The representations and warranties contained in each Loan
Document shall be correct in all material respects on and as of the Funding
Date, before and after giving effect to the Borrowing and the application of
the proceeds therefrom, as though made on and as of such date, except to the
extent that any such representation or warranty is limited to a particular
date or dates, in which case such representation or warranty shall have been
true on and as of such date or dates.
(m) No event shall have occurred and be continuing, or would result
from the Borrowing or from the application of the proceeds therefrom, that
constitutes a Default.
SECTION 3.03. Determinations Under Section 3.02. For purposes of
determining compliance with the conditions specified in Section 3.02, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Borrowing specifying its objection thereto and such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's ratable portion of the Borrowing.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower. The
Borrower hereby represents and warrants (i) in the case of clauses (a), (c)(i),
(c)(ii)(w), (c)(ii)(x), (d) (but only insofar as clauses (c)(ii)(x) and (d)
relate to the execution and delivery, but not the performance, of this
Agreement) and (e) to the extent that such clauses relate to the Borrower (but
not to any other Loan Party) and to this Agreement (but not to any other Loan
Document) and are not expressly limited to another particular date or dates, on
the date hereof and (ii) in the case of such clauses and all other clauses of
this Section 4.01, except to the extent expressly limited to another particular
date or dates, on the Funding Date (after giving effect to the Transaction), as
follows:
(a) The Borrower (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, (ii) is duly qualified and in good standing as a foreign
corporation in each other jurisdiction in which it owns or leases property
or in which the conduct of its business requires it to so qualify or be
licensed except where the failure to so qualify, be in good standing or be
licensed, either individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect and (iii) has all requisite
corporate power and authority, and all governmental licenses, permits and
other approvals (except for the absence of certain third-party consents
and approvals that result in Indemnified Consent Exposure), necessary to
own or lease and operate its properties and to carry on its business as
now conducted and as proposed to be conducted, except any such power,
authority, license, permit or approval the failure to have which would not
reasonably be expected to have a Material Adverse Effect.
(b) Set forth on Schedule 4.01(b) hereto is a complete and accurate
list as of the Funding Date (after giving effect to the Transaction) of
all Subsidiaries, including all Substantial Subsidiaries, showing, as of
the Funding Date (after giving effect to the Transaction), as to each such
Substantial Subsidiary, the correct legal name thereof, the jurisdiction
of its incorporation, the number of shares of each class of capital stock
authorized, and the number outstanding, on the Funding Date and the
percentage of the outstanding shares of each such class owned (directly or
indirectly) by each Loan Party on the Funding Date and the number of
shares covered by all outstanding options, warrants, rights of conversion
or purchase and similar rights on the Funding Date. As of the Funding
Date, all of the outstanding capital stock of all of such Substantial
Subsidiaries has been validly issued, is fully paid and non-assessable and
is owned by the person indicated on such Schedule 4.01(b), free and clear
of all Liens, except those created under the Senior Debt Documents and
those permitted under Section 5.02(a). Each such Substantial Subsidiary
(i) is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, (ii) is duly
qualified and in good standing as a foreign corporation in each other
jurisdiction in which it owns or leases property or in which the conduct
of its business requires it to so qualify or be licensed except where the
failure to so qualify, be in good standing or be licensed would not
reasonably be expected to have a Material Adverse Effect and (iii) has all
requisite corporate power and authority, and all governmental licenses,
permits and other approvals necessary to own or lease and operate its
properties and to carry on its business as now conducted and as proposed
to be conducted except any such power, authority, license, permit or
approval the failure to have which would not reasonably be expected to
have a Material Adverse Effect.
(c) The execution, delivery and performance by the Borrower of each
of this Agreement, the Notes, each other Loan Document to which it is or
is to be a party, and the consummation of the Transaction, are (i) within
the Borrower's corporate powers and have been duly authorized by all
necessary corporate action, and (ii) do not (w) contravene the Borrower's
charter or bylaws (or other similar organizational documents), (x) violate
any law, rule, regulation (including, without limitation, Regulation X
36
of the Board of Governors of the Federal Reserve System), order, writ,
judgment, injunction, decree, determination or award applicable to it the
violation of which would reasonably be expected to have a Material Adverse
Effect, (y) except for the absence of certain third-party consents and
approvals that result in Indemnified Consent Exposure, conflict with or
result in the breach of, or constitute a default under, any contract, loan
agreement, indenture, mortgage, deed of trust, lease or other instrument
binding on or affecting the Borrower, any of its Subsidiaries or any of
their properties, which conflict, default or breach would reasonably be
expected to have a Material Adverse Effect, or (z) except for the Liens
created under the Senior Debt Documents, result in or require the creation
or imposition of any Lien upon or with respect to any of the properties of
the Borrower or any of its Subsidiaries. Neither the Borrower nor any of
its Subsidiaries is in violation of any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or, except as
set forth in clause (y) above, in breach of any such contract, loan
agreement, indenture, mortgage, deed of trust, lease or either instrument,
the violation or breach of which would reasonably be expected to have a
Material Adverse Effect.
(d) No authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body or any
other third party is required for (i) the due execution, delivery or
performance by the Borrower of this Agreement, the Notes or any other Loan
Document to which it is or is to be a party, or for the consummation of
the Transaction (excluding the transactions under, and the creation and
perfection of Liens in respect of, the Senior Debt Credit Agreement and
the Collateral Documents as defined therein) or (ii) the exercise by the
Administrative Agent or any Lender Party of its rights under the Loan
Documents, except for (w) the authorizations, approvals, actions, notices
and filings listed on Part A of Schedule 4.01(d), all of which have been
duly obtained, taken, given or made as of the Closing Date and are, as of
the Closing Date, in full force and effect, (x) the authorizations,
approvals, actions, notices and filings listed on Part B of Schedule
4.01(d), all of which will have been (except to the extent indicated on
Schedule 4.01(d)) duly obtained, taken, given or made as of the Funding
Date and, as of the Funding Date, will be in full force and effect, (y)
third-party consents and approvals that have not been obtained that result
in Indemnified Consent Exposure and (z) authorizations, approvals,
actions, notices and filings the absence of which would not reasonably be
expected to have a Material Adverse Effect. As of the Funding Date, all
applicable waiting periods in connection with the Transaction have expired
without any action having been taken by any competent authority
restraining, preventing or imposing materially adverse conditions upon the
Transaction or the rights of the Borrower or its Subsidiaries freely to
transfer or otherwise dispose of, or to create any Lien on, any properties
now owned or hereafter acquired by any of them.
(e) This Agreement has been, and each of the Notes and each other
Loan Document to which the Borrower is or is to be a party, when executed
and delivered hereunder by the Borrower, will be, duly executed and
delivered by the Borrower. This Agreement is, and each of the Notes and
each other Loan Document to which the Borrower is or is to be a party when
executed and delivered hereunder by the Borrower will be, a valid and
binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, subject to applicable bankruptcy, insolvency
and other similar laws affecting creditors' rights generally and to
general equitable principles.
(f) The unaudited pro forma combined balance sheet of the Borrower
and its Subsidiaries as of September 12, 1997, and the related unaudited
pro forma combined statement of income of the Borrower and its
Subsidiaries for the 36 weeks then ended included in the Proxy Statement,
fairly present, subject to the provisions of Regulation S-X of the
Securities and Exchange Commission, the pro forma combined financial
condition of the Borrower and its Subsidiaries as at such date and the pro
forma combined results of operations of the Borrower and its Subsidiaries
for the period ended on such date, in each case giving effect to the
Transaction and the other transactions contemplated hereby as if the
Transaction and such other transactions had been consummated on such date
or at the beginning of such period, respectively, and since September 12,
1997, there has been no Material Adverse Change.
37
(g) The Consolidated forecasted balance sheets and income and cash
flow statements of the Borrower and its Subsidiaries included in the
Information Memorandum were prepared in good faith on the basis of the
assumptions stated therein, which assumptions were reasonable in the light
of conditions existing at the time of delivery of such forecasts, and
represented, at the time of delivery, the Borrower's reasonable estimate
of its future financial performance.
(h) The information concerning the Borrower and its Subsidiaries
contained in the Information Memorandum and the information concerning the
Borrower and its Subsidiaries contained in the other information, exhibits
and reports furnished by the Borrower to the Administrative Agent or any
Lender Party in connection with the negotiation of the Loan Documents or
pursuant to the terms of the Loan Documents (other than information
relating to the non-Foodservice Business), taken as a whole, did not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made therein not
misleading.
(i) Except as set forth on Schedule 4.01(i), there is no action,
suit, investigation, litigation or proceeding affecting the Borrower or
any of its Subsidiaries, including any Environmental Action, pending or
threatened before any court, governmental agency or arbitrator that would
reasonably be expected to have a Material Adverse Effect.
(j) No proceeds of any Advance will be used in violation of
Regulation G, U or X of the Board of Governors of the Federal Reserve
System.
(k) No ERISA Event has occurred or is reasonably expected to occur
with respect to any Plan that has resulted in or is reasonably expected to
result in a liability of the Borrower or any ERISA Affiliate that would
reasonably be expected to have a Material Adverse Effect.
(l) As of the last annual actuarial valuation date, except as would
not reasonably be expected to have a Material Adverse Effect, the funded
current liability percentage, as defined in Section 302(d)(8) of ERISA, of
each Plan exceeds 90% and there has been no adverse change in the funding
status of any such Plan since such date.
(m) Neither the Borrower nor any ERISA Affiliate has incurred or is
reasonably expected to incur any Withdrawal Liability to any Multiemployer
Plan that would reasonably be expected to have a Material Adverse Effect.
(n) Neither the Borrower nor any ERISA Affiliate has been notified
by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or has been terminated, within the meaning of Title IV of
ERISA, and no such Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated, within the meaning of Title IV of
ERISA, in any such case, in a manner or to an extent that would reasonably
be expected to have a Material Adverse Effect.
(o) Except as set forth in the financial statements referred to in
this Section 4.01 and in Section 5.03, the Borrower and its Subsidiaries
have no material liability with respect to "expected post retirement
benefit obligations" within the meaning of Statement of Financial
Accounting Standards No. 106 that would reasonably be expected to have a
Material Adverse Effect.
(p) Neither the business nor the properties of the Borrower or any
of its Subsidiaries are affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo,
act of God or of the public enemy or other casualty (whether or not
covered by insurance) that could reasonably be expected to have a Material
Adverse Effect.
38
(q) Except to the extent that the same would not reasonably be
expected to have a Material Adverse Effect, the operations and properties
of the Borrower and each of its Subsidiaries comply in all material
respects with all applicable Environmental Laws and Environmental Permits,
all past non-compliance with such Environmental Laws and Environmental
Permits has been resolved without ongoing obligations or costs, and no
circumstances exist that could reasonably be expected to (i) form the
basis of an Environmental Action against the Borrower or any of its
Subsidiaries or any of their properties or (ii) cause any such property to
be subject to any restrictions on ownership, occupancy, use or
transferability under any Environmental Law.
(r) Except to the extent that the same would not reasonably be
expected to have a Material Adverse Effect, (i) none of the properties
currently or formerly owned or operated by the Borrower or any of its
Subsidiaries is listed or proposed for listing on the NPL or on the
CERCLIS or any analogous foreign, state or local list or is adjacent to
any such property; (ii) there are no and never have been any underground
or aboveground storage tanks or any surface impoundments, septic tanks,
pits, slumps or lagoons in which Hazardous Materials are being or have
been treated, stored or disposed on any property currently owned or
operated by the Borrower or any of its Subsidiaries or, to the best of its
knowledge, on any property formerly owned or operated by the Borrower or
any of its Subsidiaries; (iii) there is no asbestos or asbestos-containing
material on any property currently owned or operated by the Borrower or
any of its Subsidiaries; and (iv) Hazardous Materials have not been
released, discharged or disposed of on any property currently or formerly
owned or operated by the Borrower or any of its Subsidiaries.
(s) Except to the extent that any such disposal would not reasonably
be expected to have a Material Adverse Effect, all Hazardous Materials
generated, used, treated, handled or stored at, or transported to or from,
any property currently or formerly owned or operated by the Borrower or
any of its Subsidiaries have been disposed of in a manner not reasonably
expected to result in material liability to the Borrower or any of its
Subsidiaries.
(t) The Borrower and each of its Subsidiaries have filed, have
caused to be filed or have been included in all material tax returns
(federal, state, local or foreign) required to be filed and have paid (or
there has been paid by others) all material taxes shown thereon to be due,
together with applicable interest and penalties, other that any such taxes
or tax returns in respect of which the Borrower or any such Subsidiary
shall have been indemnified by New Marriott.
(u) Neither the Merger nor the Subsidiary Contribution will be
taxable to the Borrower or any of its Subsidiaries.
(v) The Borrower is not an "investment company", as such term is
defined in the Investment Company Act of 1940, as amended.
(w) As of the Funding Date, the Borrower is, individually and
together with its Subsidiaries, Solvent.
(x) Set forth on Schedule 4.01(x) hereto is a complete and accurate
list, as of the Closing Date, of all items of Existing Debt with a
principal amount in excess of $5,000,000 (other than Debt that, following
the consummation of the Transaction but without giving effect to the
redemption of any Marriott Bonds, will be Debt of New Marriott or any
Subsidiary of New Marriott and not Debt of the Borrower or any of its
Subsidiaries) showing as of the date hereof the principal amount
outstanding thereunder and showing the aggregate principal amount of all
items of such Existing Debt with an outstanding principal amount not in
excess of $5,000,000 as of the Closing Date.
39
(y) On the Funding Date, the Borrower and its Subsidiaries own or
have the legal right to use the "Sodexho" trade name for a period of ten
years following the Funding Date and the "Marriott" trade name for a
period of four years following the Funding Date, in each case, subject to
the terms and conditions of applicable license agreements, without known
conflict with the rights of any other Person.
(z) Set forth on Schedule 4.01(z) hereto is a complete and accurate
list, as of the date of this Agreement and as of the Funding Date, of all
contracts entered or to be entered into with the Guarantor for the
providing of business-related support services, expertise or other
assistance to the Borrower or any of its Subsidiaries, under which the
annual compensation payable to the Guarantor, or the fair market value of
the annual services to be provided by the Guarantor, exceeds $2,000,000,
showing as of the date of this Agreement the parties, subject matter and
term thereof. Each such contract has been duly authorized, executed and
delivered by all parties thereto, has not been amended or otherwise
modified except as permitted under Section 5.02(f), and, except to the
extent that any such failure to be in full force and effect, binding or
enforceable or any such default would not reasonably be expected to have a
Material Adverse Effect, is in full force and effect and is binding upon
and enforceable against all parties thereto in accordance with its terms,
and there exists no default under any such contract by any party thereto.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. From and after the Funding Date
(after giving effect to the Transaction), so long as any Advance shall remain
unpaid, the Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include, without
limitation, compliance with ERISA, except to the extent that such failure
would not reasonably be expected to have a Material Adverse Effect.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become
delinquent, all material taxes, assessments and governmental charges or
levies imposed upon it or upon its property; provided, however, that
neither the Borrower nor any of its Subsidiaries shall be required to pay
or discharge any such tax, assessment, charge or claim that is being
contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained.
(c) Compliance with Environmental Laws. Except to the extent that
the failure to do so would not reasonably be expected to have a Material
Adverse Effect, (i) comply, and cause each of its Subsidiaries and all
lessees and other Persons operating or occupying its properties to comply,
in all material respects, with all applicable Environmental Laws and
Environmental Permits; (ii) obtain and renew and cause each of its
Subsidiaries to obtain and renew all Environmental Permits necessary for
its operations and properties; and (iii) conduct, and cause each of its
Subsidiaries to conduct, if required under Environmental Laws, any
investigation, study, sampling and testing, and undertake any cleanup,
removal, remedial or other action necessary to remove and clean up all
Hazardous Materials from any of its properties, in accordance with the
requirements of all Environmental Laws; provided, however, that neither
the Borrower nor any of its Subsidiaries shall be required to undertake
any such cleanup, removal, remedial or other action to the extent that its
obligation to do so is being contested in good faith and by proper
proceedings and appropriate reserves are being maintained with respect to
such circumstances.
40
(d) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which the Borrower
or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and maintain,
and cause each of its Subsidiaries to preserve and maintain, its
existence, legal structure, legal name, rights (charter and statutory),
permits, licenses, approvals, privileges and franchises, including,
without limitation, on the Funding Date only, the right to use the
"Sodexho" trade name for a period of ten years following the Funding Date
and the "Marriott" trade name for a period of four years following the
Funding Date (subject, in each case, to the terms and conditions of
applicable license agreements); provided, however, that the Borrower and
its Subsidiaries may consummate the Transaction and any other merger or
consolidation permitted under Section 5.02(c) and provided further that
neither the Borrower nor any of its Subsidiaries shall be required to
preserve any right, permit, license, approval, privilege or franchise if
the Borrower or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the
Borrower or such Subsidiary, as the case may be, and that the loss thereof
would not reasonably be expected to have a Material Adverse Effect.
(f) Visitation Rights. At any reasonable time and from time to time,
upon reasonable prior notice and at the expense of the Administrative
Agent or such Lender Party, permit the Administrative Agent or any of the
Lender Parties or any agents or representatives thereof, to examine and
make copies of and abstracts from the records and books of account of, and
visit the properties of, the Borrower and any of its Subsidiaries, and to
discuss the affairs, finances and accounts of the Borrower and any of its
Subsidiaries with any of their officers or directors and, subject to prior
notice to the Borrower and affording a reasonable opportunity for the
Borrower to have its representatives participate therein, with their
independent certified public accountants.
(g) Keeping of Books. Keep, and cause each of its Subsidiaries to
keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Borrower and each such Subsidiary in accordance with GAAP.
(h) Maintenance of Properties, Etc. Maintain and preserve, and cause
each of its Subsidiaries to maintain and preserve, all of its properties
that are used or useful in the conduct of its business in good working
order and condition, ordinary wear and tear excepted.
(i) Performance of Certain Documents. Perform and observe all of the
material terms and provisions of the Tax Agreement, the Indemnity Support
Agreement (if the Indemnity Support Agreement has been entered into) and
the Consents Side Letter to be performed or observed by it, maintain each
such document in full force and effect, enforce each such document in
accordance with its terms, take all such action to such end as may be from
time to time requested by the Administrative Agent and, upon request of
the Administrative Agent, make to each other party to each such document
such demands and requests for information and reports or for action as the
Borrower or any of its Subsidiaries is entitled to make under such
document; provided that this subsection (i) shall only apply to the
Consents Side Letter and the Indemnity Support Agreement (if the Indemnity
Support Agreement is entered into) for so long as third-party consents as
set forth in Exhibit A to the Consents Side Letter with potential
liability in excess of $25,000,000 have not been obtained.
(j) Performance of Material Contracts. Perform and observe all the
terms and provisions of each Material Contract to be performed or observed
by it (except for the absence of certain third-party consents and
approvals for which the potential liability exposure is indemnified
pursuant to the Consents Side Letter and the Indemnity Support Agreement),
maintain each such Material Contract in full force and
41
effect (other than such Material Contracts that may be terminated by
either party thereto without cause or by the Borrower with cause), enforce
each such Material Contract in accordance with its terms, and cause each
of its Subsidiaries to do so except in any case where the failure to do
so, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
(k) Transactions with Affiliates. Conduct, and cause each of its
Subsidiaries to conduct, all transactions otherwise permitted under the
Loan Documents with any of their Affiliates (other than the Borrower and
its Subsidiaries) on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate;
provided that (i) the Borrower and its Subsidiaries may enter into and
perform contracts with the Guarantor existing on the Funding Date and any
amendments thereof not prohibited by Section 5.02(f) and (ii) the Borrower
and its Subsidiaries may make payments, distributions and other transfers,
and enter into transactions, permitted under Section 5.02(h) of the Senior
Debt Credit Agreement.
(l) Ownership of Sodexho Operations. Continue to be, at all times,
the record and beneficial owner of 100% of the shares of capital stock of
Sodexho Operations.
(m) Interest Rate Hedging. Enter into, within 6 months following the
Funding Date, and maintain thereafter, interest rate Hedge Agreements with
Persons acceptable to the Administrative Agent or other fixed rate
arrangements acceptable to the Administrative Agent (i) covering a
notional amount of not less than 45% of the sum of the aggregate
outstanding principal balance of each of this Facility and the Term
Facility (as defined in the Senior Debt Credit Agreement) plus
$100,000,000, and (ii) having an average life of not less than three years
from the date of commencement.
SECTION 5.02. Negative Covenants. From and after the Funding Date
(after giving effect to the Transaction), so long as any Advance shall remain
unpaid, the Borrower will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any
Lien on or with respect to any of its properties of any character
(including, without limitation, accounts) whether now owned or hereafter
acquired, or sign or file or suffer to exist, or permit any of its
Subsidiaries to sign or file or suffer to exist, under the Uniform
Commercial Code of any jurisdiction, a financing statement that names the
Borrower or any of its Subsidiaries as debtor, or sign or suffer to exist,
or permit any of its Subsidiaries to sign or suffer to exist, any security
agreement authorizing any secured party thereunder to file such financing
statement, or assign, or permit any of its Subsidiaries to assign, any
accounts or other right to receive income, excluding, however, from the
operation of the foregoing restrictions the following:
(i) Liens created under the Senior Debt Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and, in the case of
any such Lien securing any amount in excess of $3,000,000, described
on Schedule 5.02(a) hereto;
(iv) Liens arising in connection with Capitalized Leases and
other Debt permitted under Section 5.02(b)(v); provided that no such
Lien shall extend to or cover any assets other than the assets
subject to such Capitalized Leases or the purchase of which was
financed with such Debt;
(v) any Lien existing on any asset of any corporation at the
time such corporation becomes a Subsidiary of the Borrower and not
created in contemplation of such event;
42
(vi) any Lien on any asset of any corporation existing at the
time such corporation is merged or consolidated with or into the
Borrower or a Subsidiary of the Borrower and not created in
contemplation of such event;
(vii) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Subsidiary of the Borrower and not
created in contemplation of such acquisition;
(viii) Liens on contract rights, accounts receivable arising
thereunder and fixed and capital assets used or to be used in
connection with the performance thereof securing obligations
incurred to finance such fixed or capital assets or investments
required under such contracts or obligations to subcontractors,
partners or other participants in respect of such contracts;
provided that accounts receivable subject to such Liens do not
exceed $50,000,000 in aggregate at any one time;
(ix) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt or other obligation secured by any
Lien permitted by any of the foregoing clauses of this Section,
provided that such Debt or other obligation is not increased and is
not secured by any additional assets;
(x) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt and other obligations in an aggregate
principal or face amount at any date not to exceed $30,000,000; and
(xi) Uniform Commercial Code financing statements (Form UCC-1
or other comparable form) signed in connection with operating
leases.
(b) Debt. Create, incur, assume or suffer to exist, or permit any of
its Subsidiaries to create, incur, assume or suffer to exist, any Debt other
than:
(i) Debt owed to the Borrower or to a Subsidiary of the
Borrower;
(ii) Debt outstanding on the date hereof and identified as
"Not To Be Refinanced" on Schedule 4.01(x);
(iii) the Senior Debt;
(iv) Debt under the Loan Documents;
(v) Capitalized Leases and Debt incurred or assumed for the
purpose of financing all or a part of the cost of acquiring or
constructing any fixed or capital asset, not to exceed in the
aggregate $75,000,000 at any time outstanding;
(vi) in the case of the Borrower, Debt in respect of the
Retained Marriott Bonds, the XXXXx, the indenture in respect of the
XXXXx, as the same may be amended from time to time, and the XXXXx
Allocation Agreement;
(vii) Debt incurred to finance capital assets for specific
clients in the ordinary course of business in connection with
management contracts with such clients;
(viii) Debt in respect of obligations secured by Liens
permitted under Section 5.02(a)(viii);
43
(ix) Debt in respect of Hedge Agreements entered into to hedge
against currency, interest rate and commodity price risks of the
Borrower and its Subsidiaries arising from the operations and
financing of the Borrower and its Subsidiaries and not for
speculative purposes; and
(x) other Debt not permitted under clauses (i) through (ix)
above in an aggregate principal amount outstanding at any time not
to exceed $30,000,000.
(c) Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into it, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of the assets (whether now owned or
hereafter acquired) of the Borrower and its Subsidiaries, taken as a
whole, to any Person.
(d) Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
from that described in the Proxy Statement for the Borrower and its
Subsidiaries or extensions thereof into new markets, services and product
areas in related businesses.
(e) Fiscal Year Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in its Fiscal Year (other than
changing its Fiscal Year end to August 31).
(f) Amendment of Certain Guarantor Contracts. Cancel or terminate
any material contracts entered into with the Guarantor for the providing
of business related support services, expertise or other assistance to the
Borrower or any of its Subsidiaries or consent to or accept any
cancellation or termination thereof, amend or otherwise modify any such
contract or give any consent, waiver or approval thereunder, waive any
default under or breach of any such contract, agree in any manner to any
other amendment, modification or change of any term or condition of any
such contract or take any other action in connection with any such
contract that would materially impair the value of the interest or rights
of the Borrower thereunder or that would materially impair the interest or
rights of the Administrative Agent or any Lender Party, or permit any of
its Subsidiaries to do any of the foregoing, except that such contracts
may be amended, waived or modified with the consent of the independent
directors of the Borrower; provided that the fees payable to the Guarantor
under such contracts (excluding guarantee fees) do not exceed 0.3% of
gross annual revenues of the Borrower and its Consolidated Subsidiaries in
any Fiscal Year.
SECTION 5.03. Reporting Requirements. From and after the Funding
Date, so long as any Advance shall remain unpaid, the Borrower will furnish to
the Lender Parties:
(a) Default Notice. As soon as possible and in any event within five
Business Days after a Responsible Officer of the Borrower has knowledge of
the occurrence of a Default continuing on the date of such statement, a
statement of a Responsible Officer of the Borrower setting forth details
of such Default and the action that the Borrower has taken and proposes to
take with respect thereto.
(b) Quarterly Financials. As soon as available and in any event
within 45 days after the end of each of the first three quarters of each
Fiscal Year (except that the first quarterly statements may be delivered
within 90 days after the end of the relevant quarter), a Consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such
quarter, a Consolidated statement of income of the Borrower and its
Subsidiaries for such Fiscal Quarter and for the portion of the Borrower's
Fiscal Year ending at the end of such quarter and a Consolidated statement
of cash flows of the Borrower and its Subsidiaries for the portion of the
Borrower's Fiscal Year ending at the end of such quarter, setting forth,
in each case, in comparative form the corresponding figures for the
corresponding period of the preceding Fiscal Year, all in reasonable
detail and duly certified (subject to year-end adjustments) by the chief
financial officer of the Borrower as having been prepared in accordance
with GAAP, together with (i) a certificate of said officer stating that no
Default has occurred and is continuing or, if a Default has occurred and
is continuing, a
44
statement as to the nature thereof and the action that the Borrower has
taken and proposes to take with respect thereto and (ii) a schedule in
form satisfactory to the Administrative Agent of the computations used by
the Borrower in determining compliance with the covenants contained in
Sections 5.04(a) and (b).
(c) Annual Financials. As soon as available and in any event within
90 days after the end of each Fiscal Year, a copy of the annual report for
such Fiscal Year for the Borrower and its Subsidiaries, including therein
the Consolidated balance sheet of the Borrower and its Subsidiaries as of
the end of such Fiscal Year and Consolidated statements of income and cash
flows of the Borrower and its Subsidiaries for such Fiscal Year, reported
on by independent public accountants of internationally and nationally
recognized standing in a manner acceptable to the Securities and Exchange
Commission, together with (i) a certificate of the chief financial officer
of the Borrower stating that no Default has occurred and is continuing or,
if a default has occurred and is continuing, a statement as to the nature
thereof and the action that the Borrower has taken and proposes to take
with respect thereto and (ii) a schedule in form satisfactory to the
Administrative Agent of the computations used by the Borrower in
determining, as of the end of such Fiscal Year, compliance with the
covenants contained in Sections 5.04(a) and (b).
(d) Annual Forecasts. As soon as available and in any event within
five months after the beginning of each Fiscal Year of the Borrower,
forecasts prepared by management of the Borrower, in form satisfactory to
the Administrative Agent, of Consolidated balance sheets, statements of
income and cash flows of the Borrower and its Subsidiaries on an annual
basis for the Fiscal Year following such Fiscal Year then ended and for
each Fiscal Year thereafter until the seventh anniversary of the Funding
Date, setting forth in comparative form the corresponding figures for the
immediately preceding Fiscal Year, all in reasonable detail and form
satisfactory to the Administrative Agent, together with management's
strategic discussion and analysis thereof. Any forecasts or other
information provided pursuant to this Section to any Lender Party shall be
Confidential Information subject to the provisions of Section 8.09.
(e) ERISA Events and ERISA Reports. (i) Promptly and in any event
within 10 days after the Borrower or any ERISA Affiliate knows or has
reason to know that any ERISA Event has occurred that would reasonably be
expected to have a Material Adverse Effect, a statement of the chief
financial officer of the Borrower describing such ERISA Event and the
action, if any, that the Borrower or such ERISA Affiliate has taken and
proposes to take with respect thereto and (ii) on the date any records,
documents or other information must be furnished to the PBGC with respect
to any Plan pursuant to Section 4010 of ERISA in connection with a related
event or condition that would reasonably be expected to have a Material
Adverse Effect, a copy of such records, documents and information.
(f) Plan Terminations. Promptly and in any event within two Business
Days after receipt thereof by the Borrower or any ERISA Affiliate, copies
of each notice from the PBGC stating its intention to terminate any Plan
or to have a trustee appointed to administer any Plan that would
reasonably be expected to have a Material Adverse Effect.
(g) Plan Annual Reports. Promptly and in any event within 10 days
after request of the Administrative Agent therefor, copies of each
Schedule B (Actuarial Information) to the most recently filed annual
report (Form 5500 Series) with respect to each Plan.
(h) Multiemployer Plan Notices. Promptly and in any event within
five Business Days after receipt thereof by the Borrower or any ERISA
Affiliate from the sponsor of a Multiemployer Plan, copies of each notice
concerning (i) the imposition of Withdrawal Liability by any such
Multiemployer Plan that would reasonably be expected to have a Material
Adverse Effect, (ii) the reorganization or termination, within the meaning
of Title IV of ERISA, of any such Multiemployer Plan that would reasonably
be expected to have a Material Adverse Effect or (iii) the amount of
liability incurred, or that may be incurred, by the Borrower or any ERISA
Affiliate in connection with any event described in clause (i) or (ii).
45
(i) Litigation. Promptly after the commencement thereof, notice of
all actions, suits, investigations, litigation and proceedings before any
court or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, affecting the Borrower or any of its
Subsidiaries of the type described in Section 4.01(i), and promptly after
the occurrence thereof, notice of any adverse change in the status or the
financial effect on the Borrower or any of its Subsidiaries of the
Disclosed Litigation from that described on Schedule 4.01(i).
(j) Securities Reports. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and reports
that the Borrower sends to its stockholders generally, and copies of all
regular, periodic and special reports, and all registration statements,
that the Borrower or any of its Subsidiaries files with the Securities and
Exchange Commission or any governmental authority that may be substituted
therefor, or with any national securities exchange.
(k) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of any
noncompliance by the Borrower or any of its Subsidiaries with any
Environmental Law or Environmental Permit that would reasonably be
expected to have a Material Adverse Effect.
(l) Other Information. Such other information respecting the
business, financial condition, results of operations, or prospects of the
Borrower and its Subsidiaries as any Lender Party (through the
Administrative Agent) may from time to time reasonably request.
SECTION 5.04. Financial Covenants. On and after the Funding Date, so
long as any Advance shall remain unpaid, the Borrower will:
(a) Interest Expense Coverage Ratio. Maintain, at the end of each
three-month fiscal period of the Borrower ending nearest to the last day
of each of the months set forth below, a ratio of Consolidated EBITDA to
Consolidated Interest Expense for the immediately preceding four Fiscal
Quarters (or, in the case of any Fiscal Quarter ending less than 12 months
after the Funding Date, such number of full Fiscal Quarters commencing on
or after the Funding Date as shall have ended on such date), in each case,
of the Borrower and its Subsidiaries, of at least the ratio set forth
below for such month (provided that this Section 5.04(a) shall not apply
in respect of any month set forth below the last day of which occurs less
than one full Fiscal Quarter after the Funding Date);
46
================================================================================
Fiscal Quarter End Ratio Fiscal Quarter End Ratio
--------------------------------------------------------------------------------
May, 1998 1:50:1.0 November, 2001 3.25:1.0
--------------------------------------------------------------------------------
August, 1998 1:50:1.0 February, 2002 3.25:1.0
--------------------------------------------------------------------------------
November, 1998 2.00:1.0 May, 2002 3.25:1.0
--------------------------------------------------------------------------------
February, 1999 2.00:1.0 August, 2002 3.50:1.0
--------------------------------------------------------------------------------
May, 1999 2.00:1.0 November, 2002 3.50:1.0
--------------------------------------------------------------------------------
August, 1999 2.25:1.0 February, 2003 3.50:1.0
--------------------------------------------------------------------------------
November, 1999 2.25:1.0 May, 2003 3.50:1.0
--------------------------------------------------------------------------------
February, 2000 2.25:1.0 August, 2003 3.50:1.0
--------------------------------------------------------------------------------
May, 2000 2.25:1.0 November, 2003 3.50:1.0
--------------------------------------------------------------------------------
August, 2000 2.75:1.0 February, 2004 3.50:1.0
--------------------------------------------------------------------------------
November, 2000 2.75:1.0 May, 2004 3.50:1.0
--------------------------------------------------------------------------------
February, 2001 2.75:1.0 August, 2004 3.50:1.0
--------------------------------------------------------------------------------
May, 2001 2.75:1.0 November, 2004 3.50:1.0
--------------------------------------------------------------------------------
August, 2001 3.25:1.0 February, 2005 3.50:1.0
================================================================================
(b) Cash Flow Leverage Ratio. Maintain, at the end of each three
month fiscal period of the Borrower ending nearest the last day of each
month set forth below, a Leverage Ratio of not more than the ratio set
forth below for such month (provided that this Section 5.04(b) shall not
apply in respect of any month set forth below the last day of which occurs
less than one year after the Funding Date):
================================================================================
Fiscal Quarter End Ratio Fiscal Quarter End Ratio
--------------------------------------------------------------------------------
February, 1999 6:30:1.0 May, 2002 3.90:1.0
--------------------------------------------------------------------------------
May, 1999 6.30:1.0 August, 2002 3.30:1.0
--------------------------------------------------------------------------------
August, 1999 5.40:1.0 November, 2002 3.30:1.
--------------------------------------------------------------------------------
November, 1999 5.40:1.0 February, 2003 3.30:1.0
--------------------------------------------------------------------------------
February, 2000 5.40:1.0 May, 2003 3.30:1.0
--------------------------------------------------------------------------------
May, 2000 5.40:1.0 August, 2003 3.00:1.0
--------------------------------------------------------------------------------
August, 2000 5.00:1.0 November, 2003 3.00:1.0
--------------------------------------------------------------------------------
November, 2000 5.00:1.0 February, 2004 3.00:1.0
--------------------------------------------------------------------------------
February, 2001 5.00:1.0 May, 2004 3.00:1.0
--------------------------------------------------------------------------------
May, 2001 5.00:1.0 August, 2004 3.00:1.0
--------------------------------------------------------------------------------
August, 2001 3.90:1.0 November, 2004 3.00:1.0
--------------------------------------------------------------------------------
November, 2001 3.90:1.0 February, 2005 3.00:1.0
--------------------------------------------------------------------------------
February, 2002 3.90:1.0
================================================================================
47
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing (i) from and after the date
of this Agreement, in the case of clauses (a) and (e) below and (ii) from and
after the Funding Date, for all clauses of this Section 6.01:
(a) (i) the Borrower shall fail to pay any principal of any Advance
when the same shall become due and payable or (ii) the Borrower shall fail
to pay any interest on any Advance, or any fees payable under any Loan
Document, in each case under this clause (ii) which remain unpaid beyond
seven Business Days after the same becomes due and payable; or
(b) any representation or warranty made by the Borrower (or any of
its officers) under or in connection with any Loan Document shall prove to
have been incorrect in any material respect when made; or
(c) the Borrower shall fail to perform or observe any term, covenant
or agreement (i) contained in Section 2.13, 5.01(e) (in respect of
maintaining the existence of the Borrower only), 5.01(k), 5.02, 5.03(a) or
5.04 or (ii) contained in Section 5.01(f) or 5.03(b) through (l) if such
failure shall remain unremedied for 5 Business Days after written notice
thereof shall have been given to the Borrower by the Administrative Agent
or any Lender Party; or
(d) the Borrower shall fail to perform any other term, covenant or
agreement contained in any Loan Document on its part to be performed or
observed if such failure shall remain unremedied for 30 days after written
notice thereof shall have been given to the Borrower by the Administrative
Agent or any Lender Party; or
(e) the Borrower or any Substantial Subsidiary shall generally not
pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by or
against the Borrower or any Substantial Subsidiary seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver, trustee, or other
similar official for it or for any substantial part of its property and,
in the case of any such proceeding instituted against it (but not
instituted by it), either such proceeding shall remain undismissed or
unstayed for a period of 60 days or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for
relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or any substantial part of its property)
shall occur; or the Borrower or any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e); or
(f) any judgment or order for the payment of money in excess of
$25,000,000 shall be rendered against the Borrower or any Subsidiary and
either (i) enforcement proceedings shall have been commenced by any
creditor upon such judgment or order or (ii) there shall be any period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect;
or
(g) any non-monetary judgment or order shall be rendered against the
Borrower or any Subsidiary that would reasonably be expected to have a
Material Adverse Effect, and there shall be any
48
period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not
be in effect; or
(h) any provision of the Guaranty or any other Loan Document after
delivery thereof pursuant to Section 3.02 shall for any reason cease to be
valid and binding on or enforceable against the Loan Party to it, or any
such Loan Party shall so state in writing; or
(i) the Guarantor shall at any time for any reason cease to be the
record and beneficial owner, directly or indirectly, of at least 40.01% of
the shares of capital stock of the Borrower; or
(j) the Borrower shall at any time for any reason cease to be the
record and beneficial owner of 100% of the shares of capital stock of
Sodexho Operations; or
(k) (i) any Person or two or more Persons acting in concert (other
than the Guarantor and its Subsidiaries and Affiliates of the Guarantor
that control the Guarantor and Persons controlled by a Person who controls
the Guarantor) shall have acquired beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934), directly or indirectly, of Voting Stock
of the Borrower (or other securities convertible into such Voting Stock)
representing 50% or more of the combined voting power of all Voting Stock
of the Borrower or (ii) any Person or two or more Persons acting in
concert (other than the Guarantor and its Subsidiaries and Affiliates of
the Guarantor that control the Guarantor and Persons controlled by a
Person who controls the Guarantor) shall have acquired, by contract or
otherwise, control over Voting Stock of the Borrower (or other securities
convertible into such securities) representing 50% or more of the combined
voting power of all Voting Stock of the Borrower; or
(l) any ERISA Event shall have occurred with respect to a Plan and
the sum (determined as of the date of occurrence of such ERISA Event) of
the Insufficiency of such Plan and the Insufficiency of any and all other
Plans with respect to which an ERISA Event shall have occurred and then
exist (or the liability of the Borrower and the ERISA Affiliates related
to such ERISA Event) exceeds $25,000,000; or
(m) the Borrower or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount that, when aggregated
with all other amounts required to be paid to Multiemployer Plans by the
Borrower and the ERISA Affiliates as Withdrawal Liability (determined as
of the date of such notification), exceeds $25,000,000; or
(n) the Borrower or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of
ERISA, and as a result of such reorganization or termination the aggregate
annual contributions of the Borrower and the ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated
have been or will be increased over the amounts contributed to such
Multiemployer Plans for the plan years of such Multiemployer Plans
immediately preceding the plan year in which such reorganization or
termination occurs by an amount exceeding $25,000,000,
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the obligation of each Lender to make Advances to be terminated,
whereupon the same shall forthwith terminate, and (ii) shall at the request, or
may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Notes, all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the
49
Borrower; provided, however, that in the event of an actual or deemed entry of
an order for relief with respect to the Borrower under the Federal Bankruptcy
Code, (x) the obligation of each Lender to make Advances shall automatically be
terminated and (y) the Notes, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower.
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action. (a) Each Lender Party hereby
appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers and discretion under this Agreement and
the other Loan Documents as are delegated to the Administrative Agent by the
terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto. As to any matters not expressly provided for by
the Loan Documents (including, without limitation, enforcement or collection of
the Notes), the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Required Lenders, and such instructions shall be
binding upon all Lender Parties and all holders of Notes; provided, however,
that the Administrative Agent shall not be required to take any action that
exposes the Administrative Agent to personal liability or that is contrary to
this Agreement or applicable law. The Administrative Agent agrees to give to
each Lender Party prompt notice of each notice given to it by the Borrower
pursuant to the terms of this Agreement.
(b) The Arrangers shall have no powers or discretion under this
Agreement or any of the other Loan Documents and each of the Lender Parties
hereby acknowledges that the Arrangers have no liability under this Agreement or
under any of the other Loan Documents.
SECTION 7.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with the Loan Documents, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, the Administrative Agent: (a) may treat the payee of any Note as the
holder thereof until the Administrative Agent receives and accepts an Assignment
and Acceptance entered into by the Lender that is the payee of such Note, as
assignor, and an Eligible Assignee, as assignee, as provided in Section 8.07;
(b) may consult with legal counsel (including counsel for the Borrower),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender Party and shall not be responsible to
any Lender Party for any statements, warranties or representations (whether
written or oral) made in or in connection with the Loan Documents; (d) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Loan Document on the part of
the Borrower or to inspect the property (including the books and records) of the
Borrower; (e) shall not be responsible to any Lender Party for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, any Loan Document or any
other instrument or document furnished pursuant thereto; and (f) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram or
telecopy) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 7.03. Societe Generale and Affiliates. With respect to its
Commitment, the Advance made by it and the Note issued to it, Societe Generale
shall have the same rights and powers under the
50
Loan Documents as any other Lender Party and may exercise the same as though it
were not the Administrative Agent; and the term "Lender Party" or "Lenders
Parties" shall, unless otherwise expressly indicated, include Societe Generale
in its individual capacity. Societe Generale and its affiliates may accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from and generally engage in any kind of business
with, any Loan Party, any of its Subsidiaries and any Person who may do business
with or own securities of any Loan Party or any such Subsidiary, all as if
Societe Generale were not the Administrative Agent and without any duty to
account therefor to the Lender Parties.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon the
Administrative Agent, the Arrangers or any other Lender Party and based on the
financial statements referred to in Section 4.01 and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender Party also acknowledges that
it will, independently and without reliance upon the Administrative Agent, the
Arrangers or any other Lender Party 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.
SECTION 7.05. Indemnification. Each Lender Party severally agrees to
indemnify the Administrative Agent (to the extent not promptly reimbursed by the
Borrower) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by, or asserted
against the Administrative Agent in any way relating to or arising out of the
Loan Documents or any action taken or omitted by the Administrative Agent under
the Loan Documents; provided, however, that no Lender Party shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender Party agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel) payable
by the Borrower under Section 8.04, to the extent that the Administrative Agent
is not promptly reimbursed for such costs and expenses by the Borrower. For
purposes of this Section 7.05, the Lender Parties' respective ratable shares of
any amount shall be determined, at any time, according to the sum of (a) the
aggregate principal amount of the Advances outstanding at such time and owing to
the respective Lender Parties and (b) the Commitments of the respective Lender
Parties at such time. The failure of any Lender Party to reimburse the
Administrative Agent promptly upon demand for its ratable share of any amount
required to be paid by the Lender Party to the Administrative Agent as provided
herein shall not relieve any other Lender Party of its obligation hereunder to
reimburse the Administrative Agent for its ratable share of such amount, but no
Lender Party shall be responsible for the failure of any other Lender Party to
reimburse the Administrative Agent for such other Lender Party's ratable share
of such amount. Without prejudice to the survival of any other agreement of any
Lender Party hereunder, the agreement and obligations of each Lender Party
contained in this Section 7.05 shall survive the payment in full of principal,
interest and all other amounts payable hereunder and under the other Loan
Documents.
SECTION 7.06. Successor Agents. The Administrative Agent may resign
at any time by giving written notice thereof to the Lender Parties and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Administrative Agent with, unless an Event of Default
shall have occurred and be continuing, the consent of the Borrower, which
consent shall not be unreasonably withheld or delayed. If no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lender Parties, appoint a successor
Administrative Agent with, unless an Event of Default shall have occurred and be
continuing, the consent of the Borrower, which consent shall not be unreasonably
withheld or delayed, which shall be a commercial bank organized under, or having
a branch authorized to operate under, the laws of the United States or of any
State thereof and having a combined capital and surplus of at least
$250,000,000. Upon the acceptance of any
51
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall succeed to and become vested
with all the rights, powers, discretion, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations under the Loan Documents. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Notes or any other Loan Document, nor consent
to any departure by the Borrower therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Borrower and the Required
Lenders, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
(a) no amendment, waiver or consent shall, unless in writing and signed by the
Requisite Lenders, waive any of the conditions specified in Section 3.01 or
3.02, (b) no amendment, waiver or consent shall, unless in writing and signed by
all of the Lenders (other than any Lender Party that is, at such time, a
Defaulting Lender), do any of the following at any time: (i) change the number
of Lenders or the percentage of (x) the Commitments or (y) the aggregate unpaid
principal amount of the Advances that, in each case, shall be required for the
Lenders or any of them to take any action hereunder, (ii) reduce or limit the
obligations of the Guarantor under Section 1 of the Guaranty or otherwise limit
the Guarantor's liability with respect to the Obligations owing to the
Administrative Agent and the Lender Parties, except as expressly permitted
therein, or (iii) amend this Section 8.01 and (c) no amendment, waiver or
consent shall, unless in writing and signed by the Required Lenders and each
Lender that has a Commitment or an Advance outstanding under the Facility if
affected by such amendment, waiver or consent, (i) increase the Commitment of
such Lender or subject such Lender to any additional obligations, (ii) reduce
the principal of, or interest on, the Note held by such Lender or any fees or
other amounts payable hereunder to such Lender, or (iii) postpone any date fixed
under Section 2.03 for any payment of principal of or fixed under Section 2.05
or 2.06 for any payment of any interest on, the Note held by such Lender or
fixed under Section 2.07 for payment of any fees payable hereunder to such
Lender; provided further that no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement.
SECTION 8.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopy communication)
and mailed, telecopied or delivered
if to the Borrower:
00000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, General Counsel
Telecopy number: (000) 000-0000
52
with a copy to:
Xxxxxx Xxxxx, Treasurer
Sodexho Marriott Operations, Inc.
00000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopy number: (000) 000-0000
and:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, Esq.
Telecopy number: (000) 000-0000
if to any Initial Lender, at its Domestic Lending Office specified opposite its
name on Schedule I hereto; if to any other Lender Party, at its Domestic Lending
Office specified in the Assignment and Acceptance pursuant to which it became a
Lender Party; and
if to the Administrative Agent:
1221 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxx X. Xxxx
Telecopy number: (000) 000-0000
or, as to the Borrower or the Administrative Agent, at such other address as
shall be designated by such party in a written notice to the other parties and,
as to each other party, at such other address as shall be designated by such
party in a written notice to the Borrower and the Administrative Agent. All such
notices and communications shall be effective (i) if given by telecopy, when
transmitted to the telecopy number referred to in this Section and confirmation
of receipt is received, (ii) if given by mail, 72 hours after such communication
is deposited in the mails with postage prepaid, addressed as aforesaid or (iii)
if given by any other means, when delivered at the address referred to in this
Section, except that notices and communications to the Administrative Agent
pursuant to Article II or VII shall not be effective until received by the
Administrative Agent. Delivery by telecopier of an executed counterpart of any
amendment or waiver of any provision of this Agreement or the Notes or of any
Exhibit hereto to be executed and delivered hereunder shall be effective as
delivery of a manually executed counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of any
Lender Party or the Administrative Agent to exercise, and no delay in
exercising, any right hereunder or under any Note shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude any
other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to pay on
demand (i) pursuant to a written budget mutually satisfactory to the Borrower
and the Arrangers (it being understood that such budget is not a maximum cap on
any expenses payable by the Borrower specified in this Section 8.04, or
otherwise), all reasonable costs and expenses of the Administrative Agent and
the Arrangers in connection with the preparation, execution, delivery,
administration, modification, waiver and amendment of the Loan Documents
(including, without limitation, (A) all due diligence, syndication,
transportation, computer, duplication, audit, insurance and
53
consultant fees and expenses and (B) the reasonable fees and expenses of counsel
for the Administrative Agent and the Arrangers with respect thereto, with
respect to advising the Administrative Agent and the Arrangers as to their
rights and responsibilities, or the perfection, protection or preservation of
rights or interests, under the Loan Documents, with respect to negotiations with
the Borrower or with other creditors of the Borrower or any of its Subsidiaries
arising out of any Default or any events or circumstances that may give rise to
a Default and with respect to presenting claims in or otherwise participating in
or monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto) and (ii) after
the occurrence of an Event of Default, all reasonable costs and expenses of the
Administrative Agent, the Arrangers and the Lender Parties in connection with
the enforcement of the Loan Documents, whether in any action, suit or
litigation, any bankruptcy, insolvency or other similar proceeding affecting
creditors' rights generally (including, without limitation, the reasonable fees
and expenses of counsel for the Administrative Agent, the Arrangers and each
Lender Party with respect thereto).
(b) The Borrower agrees to indemnify and hold harmless the
Administrative Agent, each Arranger, each Lender Party and each of their
Affiliates and their officers, directors, employees, agents and advisors (each,
an "Indemnified Party") from and against any and all claims, damages, losses,
liabilities and expenses (including, without limitation, reasonable fees and
expenses of counsel) that may be incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection with or by
reason of any investigation, litigation or proceeding or preparation of a
defense in connection therewith arising out of or relating to (i) the Facility,
the actual or proposed use of the proceeds of the Advances, the Loan Documents
or any of the transactions contemplated thereby or (ii) the actual or alleged
presence of Hazardous Materials on any property of the Borrower or any of its
Subsidiaries or any Environmental Action relating in any way to the Borrower or
any of its Subsidiaries, except to the extent such claim, damage, loss,
liability or expense is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 8.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by the Borrower, its directors, shareholders or creditors
or an Indemnified Party or any Indemnified Party is otherwise a party thereto
and whether or not the transactions contemplated hereby are consummated. The
Borrower also agrees not to assert any claim against the Administrative Agent,
any Arranger, any Lender Party or any of their Affiliates, or any of their
respective officers, directors, employees, attorneys and agents, on any theory
of liability, for consequential damages arising out of or otherwise relating to
the Facility, the actual or proposed use of the proceeds of the Advances, the
Loan Documents or any of the transactions contemplated thereby.
(c) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by the Borrower to or for the account of a Lender Party
other than on the last day of the Interest Period for such Advance, as a result
of a payment or Conversion pursuant to Section 2.08(b)(i) or 2.09(d),
acceleration of the maturity of the Notes pursuant to Section 6.01 or for any
other reason, the Borrower shall, upon demand by such Lender Party (with a copy
of such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender Party any amounts required to compensate such Lender
Party for any losses, costs or expenses that it may reasonably incur as a result
of such payment, including, without limitation, any loss, cost or expense (but
excluding loss of margin after the date of such payment or conversion) incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by any Lender Party to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs, expenses or
other amounts payable by it under any Loan Document, including, without
limitation, fees and expenses of counsel and indemnities, such amount may be
paid on behalf of such Loan Party by the Administrative Agent or any Lender
Party, in its sole discretion.
54
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.09 and 2.11 and this Section
8.04 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under any of the other Loan Documents.
(f) The Lender Parties acknowledge that (i) prior to the Funding
Date, the obligations of the Borrower for costs, expenses, fees and
indemnification under or in connection with this Agreement shall be the
responsibility of the Borrower and the Guarantor pursuant to the terms of the
Commitment Letter dated November 26, 1997 entered into by such parties with
Xxxxxx and the Arrangers and (ii) all amounts due and payable by the Borrower
prior to the Funding Date (including pursuant to Section 3.01(b)) shall be
advanced by the Guarantor, provided that nothing contained in this paragraph (f)
shall limit the liability of the parties hereto as set forth in the terms of
said Commitment Letter.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and during
the continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Lender Party and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender Party or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the Obligations of the Borrower now or hereafter existing under this
Agreement and the Note (if any) held by such Lender Party, irrespective of
whether such Lender Party shall have made any demand under this Agreement or
such Note and although such obligations may be unmatured. Each Lender Party
agrees promptly to notify the Borrower after any such set-off and application;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender Party and
its respective Affiliates under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) that such
Lender Party and its respective Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall be binding upon
and inure to the benefit of the Borrower, the Administrative Agent, each Lender
Party and their respective successors and assigns, except that the Borrower
shall not have the right to assign its rights hereunder or any interest herein
without the prior written consent of the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender may
assign to one or more Eligible Assignees all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Advances owing to it and the Note held by it);
provided, however, that (i) except in the case of an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment or Advances of the assigning Lender being assigned pursuant to each
such assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $15,000,000 (or
$5,000,000, in the case of an assignment to an existing Lender), (ii) each such
assignment shall be to an Eligible Assignee and (iii) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a processing and
recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording, from
and after the effective date specified in such Assignment and Acceptance, (x)
the assignee thereunder shall be a party hereto and, to the extent that rights
and obligations hereunder have been assigned to it pursuant to such Assignment
and Acceptance, have the rights and obligations of a Lender hereunder and (y)
the Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an
55
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(c) By executing and delivering an Assignment and Acceptance, the
Lender Party assignor thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, this Agreement or any
other Loan Document or any other instrument or document furnished pursuant
hereto or thereto; (ii) such assigning Lender Party makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or any other Loan Party or the performance or observance by the
Borrower of any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Section 4.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such assigning
Lender Party or any other Lender Party 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; (v) such
assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Loan Documents as
are delegated to the Administrative Agent by the terms hereof, together with
such powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.
(d) The Administrative Agent acting for this purpose (but only for
this purpose) as the agent of the Borrower, shall maintain at its address
referred to in Section 8.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lender Parties and the Commitment of, and principal amount of
the Advances owing to, each Lender Party from time to time (the "Register"). The
entries in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Administrative Agent and the Lender
Parties shall treat each Person whose name is recorded in the Register as a
Lender Party hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender Party at any reasonable
time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note subject to such
assignment, the Administrative Agent shall, if such Assignment and Acceptance
has been completed and is in substantially the form of Exhibit C hereto, (i)
accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the Borrower. In
the case of any assignment by a Lender, within 15 Business Days after its
receipt of such notice, the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent in exchange for the surrendered Note a new
Note to the order of such Eligible Assignee in an amount equal to the Commitment
or, after the Funding Date, the principal amount of the outstanding Advance
assumed by it under the Facility pursuant to such Assignment and Acceptance and,
if the assigning Lender has retained a Commitment or a portion of the principal
amount of its outstanding Advance under the Facility, a new Note to the order of
the assigning Lender in an amount equal to the Commitment or portion of such
Advance retained by it hereunder. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note, shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of Exhibit A hereto.
56
(f) No assignee, participant or other transferee of any Lender
Party's rights shall be entitled to receive any greater payment under Section
2.09 or 2.11 than such Lender Party would have been entitled to receive with
respect to the rights transferred, unless such transfer is made with the
Borrower's prior written consent or by reason of the provisions of Section 2.09
or 2.11 requiring such Lender to designate a different Applicable Lending Office
under certain circumstances or at a time when the circumstances giving rise to
such greater payment did not exist.
(g) Each Lender Party may sell participations to one or more Persons
(other than the Borrower or any of its Affiliates) in or to all or a portion of
its rights, obligations, or rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitment, the Advances
owing to it and the Note (if any) held by it); provided, however, that (i) such
Lender Party's obligations under this Agreement (including, without limitation,
its Commitment) shall remain unchanged, (ii) such Lender Party shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender Party shall remain the holder of any such Note
for all purposes of this Agreement, (iv) the Borrower, the Administrative Agent
and the other Lender Parties shall continue to deal solely and directly with
such Lender Party in connection with such Lender Party's rights and obligations
under this Agreement and (v) no participant under any such participation shall
have any right to approve any amendment or waiver of any provision of any Loan
Document, or any consent to any departure by the Borrower therefrom, except to
the extent that such amendment, waiver or consent would reduce the principal of,
or interest on, the Note or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, postpone any date fixed under
Section 2.04 for any payment of principal of, or fixed under Section 2.05 or
2.06 for any payment of interest on the Note or fixed under Section 2.07 for any
payment of any fees payable hereunder, in each case to the extent subject to
such participation.
(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower; provided, however, that, prior to any
such disclosure, the assignee or participant or proposed assignee or participant
shall agree in writing to preserve the confidentiality of any Confidential
Information received by it from such Lender Party in accordance with Section
8.09 hereof.
(i) Notwithstanding any other provision set forth in this Agreement,
any Lender Party may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Advances owing to it and the Note held by it) in favor of any Federal Reserve
Bank in accordance with Regulation A of the Board of Governors of the Federal
Reserve System.
SECTION 8.08. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.09. Confidentiality. (a) Neither the Administrative Agent
nor any Lender Party shall disclose any Confidential Information to any Person
without the consent of the Borrower, other than (i) to the Administrative
Agent's or such Lender Party's Affiliates and their officers, directors,
employees, agents and advisors who need to know such Confidential Information in
connection with the Administrative Agent's or such Lender Party's evaluation or
administration of the Facility and to actual or prospective Eligible Assignees
and participants who have agreed in writing to be bound by this Section, (ii) as
required by any law, rule or regulation or judicial process, provided that the
Administrative Agent or any Lender Party so required to disclose any
Confidential Information will, to the extent permitted under applicable law, (x)
notify the Borrower immediately of the existence, terms and circumstances
surrounding such requirement, (y) consult with the
57
Borrower on the advisability of taking legally available steps to resist or
narrow such requirement and (z) if disclosure of such Confidential Information
is legally required, furnish only such portion of the Confidential Information
as it is legally compelled to disclose and exercise commercially reasonable
efforts to obtain an order or other reliable assurance that confidential
treatment will be accorded to the disclosed Confidential Information, and (iii)
as requested or required by any state, federal or foreign authority or examiner
regulating banks or banking.
(b) The Administrative Agent and each Lender Party hereby
acknowledges and agrees that, in the event of any breach by it of this Section
8.09, the Borrower and the Guarantor would be irreparably and immediately harmed
and could not be made whole by monetary damages. Accordingly, the Administrative
Agent and each Lender Party agrees, to the fullest extent it may effectively do
so under applicable law, that, in addition to any other remedy to which the
Borrower and the Guarantor may be entitled at law or in equity, the
Administrative Agent and each Lender Party shall be entitled to an injunction or
injunctions (without the posting of any bond and without proof of actual
damages) to prevent breaches or threatened breaches of this Section 8.09 and/or
to compel specific performance of this Section 8.09, and that none of the
Administrative Agents, any Lender Party or any of their respective
representatives will oppose the granting of such relief.
SECTION 8.10. No Reliance on Margin Stock. Each of the Lender
Parties represents to the Administrative Agent and each of the other Lender
Parties that it in good faith is not relying upon any "margin stock" (as defined
in Regulation U) as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Loan Documents to which it is a party, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Loan Documents in the
courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Loan Documents to which it is a party in any such New York State or
federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
SECTION 8.12. Governing Law. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 8.13. Waiver of Jury Trial. Each of the Borrower, the
Administrative Agent and the Lender Parties irrevocably waives all right to
trial by jury in any action, proceeding or counterclaim (whether based on
contract, tort or otherwise) arising out of or relating to any of the Loan
Documents, the
58
Advances or the actions of the Administrative Agent or any Lender Party in the
negotiation, administration, performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
MARRIOTT INTERNATIONAL, INC. (to be
renamed SODEXHO MARRIOTT SERVICES,
INC.)
By /s/ Xxxxxxxx Xxxxx
---------------------------------
Title: Vice President
SOCIETE GENERALE, as Administrative Agent
By /s/ Xxxxxxxxx Xxxx
---------------------------------
Title: Vice President
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as Documentation Agent
By /s/ Xxxxxxxx X. Xxxxx
---------------------------------
Title: Vice President
Initial Lenders
SOCIETE GENERALE
By /s/ Xxxxxxxxx Xxxx
---------------------------------
Title: Vice President
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK
By /s/ Xxxxxxxx X. Xxxxx
---------------------------------
Title: Vice President
THE BANK OF NEW YORK
By /s/ Xxxxxx X. Xxxxx
---------------------------------
Title: Vice President
THE BANK OF NOVA SCOTIA
By /s/ J.R. Trimble
----------------------------------
Title: Senior Relationship Manager
BANQUE NATIONALE DE PARIS
By /s/ Xxxxxxx X. Xxxx
---------------------------------
Title: Senior Vice President
By /s/ Xxxx X. Xxxxxxx
---------------------------------
Title: Vice President
BANQUE PARIBAS
By /s/ Xxxxxx X. Xxxxxx
---------------------------------
Title: Vice President
By /s/ Xxxxx Xxxxxxxxx
---------------------------------
Title: Vice President
CIBC INC.
By /s/ Xxxx Xxxxxxxxxx
---------------------------------
Title: Executive Director
CAISSE CENTRALE DES BANQUES
POPULAIRES
By /s/ Xxxxx Xxxxxxx
---------------------------------
Title: Directeur Adjoint
By /s/ Xxxxxxxx Xxxxxxxx
---------------------------------
Title: Fonde de Pouvoirs Principal
THE CHASE MANHATTAN BANK
By /s/ Xxxxx X. Xxxxx
---------------------------------
Title: Vice President
CITIBANK, N.A.
By /s/ Xxxxxxxx Xxxx
---------------------------------
Title: Attorney-in-Fact
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE
By /s/ Xxxx XxXxxxx-Xxxxx
---------------------------------
Title: Vice President
By /s/ Xxxxxxx Xxxxxx
---------------------------------
Title: Deputy General Manager
CREDIT AGRICOLE INDOSUEZ
By /s/ Xxxxxxx Xxxxx
---------------------------------
Title:
By /s/ Xxxxxx Xxxxxxxx
---------------------------------
Title: Vice President
CREDIT COMMERCIAL DE FRANCE
NEW YORK BRANCH
By /s/ Xxxxxxxxx Xxxxxx /s/ Xxxx-Xxxxxxx Xxxxxxx
----------------------- ------------------------
Title: AVP SVP
CREDIT LYONNAIS NEW YORK BRANCH
By /s/ Olivier Perrain
---------------------------------
Title: First Vice President
DG BANK, DEUTSCHE
GENOSSENSCHAFTSBANK
By /s/ Xxxxx XxXxxx
---------------------------------
Title: Senior Vice President
By /s/ S. Winott
---------------------------------
Title: Assistant Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Xxx Xxxxxxxx
---------------------------------
Title: Assistant Vice President
FIRST UNION NATIONAL BANK
By /s/ Xxxx X. Xxxxxx
---------------------------------
Title: Senior Vice President
MELLON BANK, N.A.
By /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Title: Vice President
NATEXIS BANQUE
By /s/ Xxxxxx X. van Tulder
---------------------------------
Title: Vice President
By /s/ Xxxx Xxxx
---------------------------------
Title: Assistant Vice President
NATIONSBANK, N.A.
By /s/ Xxxxx Xxxxxxxx
---------------------------------
Title: Vice President
XXXXX BANK N.A.
By /s/ Xxxxx Xxxxx
---------------------------------
Title: Vice President
THE ROYAL BANK OF SCOTLAND plc
By /s/ Xxxxx Xxxxxx
---------------------------------
Title: Vice President
