Execution Copy
COMPETITIVE ADVANCE AND
MULTI-CURRENCY CREDIT FACILITIES AGREEMENT
Dated as of June 29, 2001
among
CHOICE HOTELS INTERNATIONAL, INC.,
as Borrower,
THE LENDERS NAMED HEREIN,
and
THE CHASE MANHATTAN BANK, as Issuing Bank and Agent
with
X.X. XXXXXX SECURITIES INC., as Sole Bookrunner
and Lead Arranger
FLEET NATIONAL BANK, as Syndication Agent
XXXXXXX XXXXX BARNEY INC., as Syndication Agent
and
FIRST UNION NATIONAL BANK, as Documentation Agent
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS...................................................... 1
SECTION 1.01. Defined Terms............................................ 1
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SECTION 1.02. Classification of Loans and Borrowings................... 25
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SECTION 1.03. Terms Generally.......................................... 26
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ARTICLE II. THE CREDITS..... ........................................... 26
SECTION 2.01. Commitments.............................................. 26
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SECTION 2.02. Loans.................................................... 27
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SECTION 2.03. Competitive Bid Procedure................................ 30
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SECTION 2.04. Term Borrowing and Standby Borrowing Procedures.......... 33
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SECTION 2.05. Refinancings............................................. 34
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SECTION 2.06. Fees..................................................... 34
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SECTION 2.07. Evidence of Indebtedness; Repayment of Loans............. 35
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SECTION 2.08. Interest on Loans........................................ 36
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SECTION 2.09. Default Interest......................................... 37
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SECTION 2.10. Alternate Rate of Interest............................... 37
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SECTION 2.11. Termination and Reduction of Commitments................. 38
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SECTION 2.12. Prepayment; Amortization of Term Loans................... 39
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SECTION 2.13. Reserve Requirements; Change in Circumstances............ 40
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SECTION 2.14. Change in Legality....................................... 42
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SECTION 2.15. Indemnity................................................ 43
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SECTION 2.16. Pro Rata Treatment....................................... 44
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SECTION 2.17. Sharing of Setoffs....................................... 45
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SECTION 2.18. Payments................................................. 45
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SECTION 2.19. Taxes.................................................... 46
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SECTION 2.20. Letters of Credit........................................ 49
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SECTION 2.21. Currency Fluctuations, etc............................... 55
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SECTION 2.22. Increase in Commitment................................... 55
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SECTION 2.23. Special Provisions Regarding Standby Loans............... 57
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SECTION 2.24. Replacement of Certain Lenders........................... 60
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ARTICLE III. REPRESENTATIONS AND WARRANTIES................................. 60
SECTION 3.01. Organization; Powers..................................... 60
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SECTION 3.02. Authorization............................................ 61
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SECTION 3.03. Enforceability........................................... 61
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SECTION 3.04. Governmental Approvals................................... 61
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SECTION 3.05. Financial Statements..................................... 61
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SECTION 3.06. No Material Adverse Change.............................. 62
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SECTION 3.07. Title to Properties; Possession Under Leases............ 62
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SECTION 3.08. Subsidiaries............................................ 62
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SECTION 3.09. Litigation; Compliance with Laws........................ 62
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SECTION 3.10. Agreements.............................................. 63
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SECTION 3.11. Federal Reserve Regulations............................. 63
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SECTION 3.12. Investment Company Act; Public Utility Holding
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Company Act............................................. 63
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SECTION 3.13. Use of Proceeds......................................... 64
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SECTION 3.14. Tax Returns............................................. 64
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SECTION 3.15. No Material Misstatements............................... 64
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SECTION 3.16. Employee Benefit Plans.................................. 64
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SECTION 3.17. Environmental Matters................................... 65
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SECTION 3.18. Solvency................................................ 65
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ARTICLE IV. CONDITIONS OF LENDING........................................... 65
SECTION 4.01. All Credit Events....................................... 66
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SECTION 4.02. First Credit Event...................................... 66
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ARTICLE V. AFFIRMATIVE COVENANTS............................................ 68
SECTION 5.01. Existence; Businesses and Properties.................... 68
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SECTION 5.02. Insurance............................................... 69
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SECTION 5.03. Taxes................................................... 69
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SECTION 5.04. Financial Statements, Reports, etc...................... 69
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SECTION 5.05. Litigation and Other Notices............................ 70
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SECTION 5.06. ERISA................................................... 71
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SECTION 5.07. Maintaining Records; Access to Properties and
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Inspections............................................. 72
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SECTION 5.08. Use of Proceeds......................................... 72
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SECTION 5.09. Subsidiaries............................................ 72
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ARTICLE VI. NEGATIVE COVENANTS.............................................. 73
SECTION 6.01. Indebtedness............................................ 73
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SECTION 6.02. Liens................................................... 73
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SECTION 6.03. Sale and Lease-Back Transactions........................ 75
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SECTION 6.04. Investments, Loans and Advances......................... 75
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SECTION 6.05. Mergers and Consolidations.............................. 76
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SECTION 6.06. Asset Sales............................................. 76
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SECTION 6.07. Transactions with Affiliates............................ 76
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SECTION 6.08. Business of Borrower and Subsidiaries................... 77
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SECTION 6.09. Agreements.............................................. 77
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SECTION 6.10. Fiscal Year............................................. 77
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3
SECTION 6.11. No Further Negative Pledges............................. 77
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SECTION 6.12. Consolidated Leverage Ratio............................. 77
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SECTION 6.13. Consolidated Interest Coverage Ratio.................... 78
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SECTION 6.14. Required Guarantors..................................... 78
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ARTICLE VII. EVENTS OF DEFAULT.............................................. 78
ARTICLE VIII. THE AGENT..................................................... 82
ARTICLE IX. MISCELLANEOUS................................................... 84
SECTION 9.01. Notices................................................. 84
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SECTION 9.02. Survival of Agreement................................... 85
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SECTION 9.03. Binding Effect.......................................... 85
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SECTION 9.04. Successors and Assigns.................................. 86
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SECTION 9.05. Expenses; Indemnity..................................... 90
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SECTION 9.06. Right of Setoff......................................... 92
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SECTION 9.07. Applicable Law.......................................... 93
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SECTION 9.08. Waivers; Amendment...................................... 93
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SECTION 9.09. Interest Rate Limitation................................ 94
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SECTION 9.10. Entire Agreement........................................ 94
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SECTION 9.11. Waiver of Jury Trial; Punitive Damages.................. 95
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SECTION 9.12. Severability............................................ 95
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SECTION 9.13. Counterparts............................................ 95
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SECTION 9.14. Headings................................................ 95
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SECTION 9.15. Jurisdiction; Consent to Service of Process;
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Judgment Currency....................................... 95
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SECTION 9.16. Confidentiality......................................... 97
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SECTION 9.17. European Monetary Union................................. 98
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SECTION 9.18. No Bankruptcy Proceedings............................... 98
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4
Exhibits
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Exhibit A-1 Form of Competitive Bid Request
Exhibit A-2 Form of Notice of Competitive Bid Request
Exhibit A-3 Form of Competitive Bid
Exhibit A-4 Form of Competitive Bid Accept/Reject
Letter
Exhibit A-5 Form of Borrowing Request
Exhibit B Form of Administrative Questionnaire
Exhibit C Form of Assignment and Acceptance
Exhibit D Form of Opinion of Counsel
Exhibit E-1 Form of Guarantee Agreement for Domestic Subsidiaries
Exhibit E-2 Form of Guarantee Agreement for Foreign Subsidiaries
Exhibit F Form of Designated Bank Note
Exhibit G Form of Designation Agreement
Schedules
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Schedule 1.01 Hotel Properties
Schedule 2.01 Commitments
Schedule 2.20(a) Existing Letters of Credit
Schedule 3.08 Subsidiaries
Schedule 6.02 Existing Liens
Schedule 6.04 Existing Investments
COMPETITIVE ADVANCE AND MULTI-CURRENCY CREDIT
FACILITIES AGREEMENT
COMPETITIVE ADVANCE AND MULTI-CURRENCY CREDIT FACILITIES AGREEMENT dated as
of June 29, 2001, among CHOICE HOTELS INTERNATIONAL, INC., a Delaware
corporation (the "Borrower"), the Lenders referred to herein and THE CHASE
MANHATTAN BANK, a New York banking corporation, as agent for the Lenders (in
such capacity, the "Agent"). Capitalized terms used in this Agreement shall have
the meanings assigned to such terms in Section 1.01.
The Borrower has requested the Lenders to extend credit to the Borrower in
order to enable it to borrow (a) on a term basis on the Effective Date a
principal amount not in excess of $150,000,000 and (b) on a standby revolving
credit basis on and after the Effective Date and at any time and from time to
time prior to the Revolving Maturity Date an aggregate principal amount not in
excess of $110,000,000 at any time outstanding. The Borrower has requested that
up to $36,666,666.67 of such revolving credit borrowings be available to the
Borrower in Alternative Currencies. The Borrower has also requested the Lenders
to provide a procedure to increase the amount of revolving credit loans
(including those in Alternative Currencies) if additional commitments are
obtained. The Borrower has also requested the Lenders to provide a procedure
pursuant to which the Borrower may invite the Lenders to bid on an uncommitted
basis on short term borrowings by the Borrower up to fifty percent of the Total
Revolving Commitment. The Borrower has requested the Issuing Bank to issue
letters of credit, in an aggregate face amount at any time outstanding not in
excess of $30,000,000. The proceeds of the borrowings and the letters of credit
hereunder shall be used for the refinancing of existing Indebtedness, stock
repurchases, capital contributions to joint ventures and general corporate
purposes of the Borrower and the Subsidiaries, including working capital,
capital expenditures and certain acquisitions. The Lenders are willing to extend
such credit to the Borrower and the Issuing Bank is willing to issue letters of
credit for the account of the Borrower on the terms and subject to the
conditions herein set forth. Accordingly, the parties hereto agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms
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shall have the meanings specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
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"ABR Loan" shall mean any Loan denominated in dollars bearing interest at a
rate determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.
"ABR Standby Loan" shall mean any Standby Loan denominated in dollars
bearing interest at a rate determined by reference to the Alternate Base Rate in
accordance with the provisions of Article II.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
"Administrative Questionnaire" shall mean an Administrative Questionnaire
in the form of Exhibit B.
"Affiliate" shall mean, when used with respect to a specified person,
another person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the person
specified.
"Agent" shall have the meaning assigned to such term in the recitals.
"Agent and Administrative Fees" shall have the meaning assigned to such
term in Section 2.06(b).
"Aggregate Principal Amount Outstanding" shall mean, at any time, the sum
of (i) the aggregate principal amount at such time of all outstanding Revolving
Loans denominated in dollars and (ii) the aggregate Equivalent Dollar Amount at
such time of the principal amounts of all outstanding Eurocurrency Revolving
Loans.
"Aggregate Standby Exposure" shall mean the aggregate amount of the
Lenders' Standby Exposures.
"Agreement" shall mean this Competitive Advance and Multi-Currency Credit
Facilities Agreement.
"Alternate Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day, or (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof,
"Prime Rate" shall mean the rate of interest per annum publicly announced from
time to time by the Agent as its prime rate in effect at its principal office in
New York City; each change in the Prime Rate shall be effective on the date such
change is publicly announced as effective. "Federal Funds Effective Rate" shall
mean, for
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any day, the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for the day of such
transactions received by the Agent from three Federal funds brokers of
recognized national standing selected by it. If for any reason the Agent shall
have determined that it is unable to ascertain the Federal Funds Effective Rate,
including the inability or failure of the Agent to obtain sufficient quotations
in accordance with the terms thereof, the Alternate Base Rate shall be
determined without regard to clause (b) of the first sentence of this definition
until the circumstances giving rise to such inability no longer exist. Any
change in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Alternative Currency" shall mean Euros, Sterling, French Francs, Deutsche
Marks, any European common currency referred to in Section 9.17 and any other
freely available currency that is freely transferable and freely convertible
into dollars and in which dealings in deposits are carried on in the London
interbank market, which shall be requested by the Borrower and approved by the
Lenders with Revolving Tranche B Commitments.
"Alternative Currency Letter of Credit" shall mean a Letter of Credit
denominated in an Alternative Currency.
"Applicable Percentage" shall mean, with respect to any Eurodollar Standby
Loan or ABR Loan or with respect to the Facility Fees, as the case may be, the
applicable percentage per annum set forth in the table below under the caption
"Applicable Percentage for LIBOR Rate Loans", "Applicable Percentage for
Alternate Base Rate Loans" or "Facility Fee Percentage", as the case may be,
based upon the Borrower's Credit Rating as set forth below:
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Revolving Loans
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Range of the Range of the Applicable Applicable Facility Fee
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Borrower's Borrower's Percentage Percentage for Percentage
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Credit Rating Credit-Rating for LIBOR Alternate Base
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(S&P) (Xxxxx'x) Rate Loans Rate Loans
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BBB+ or higher Baa1 or higher 0.60% 0 0.15%
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BBB Baa2 0.80% 0 0.20%
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BBB- Baa3 1.00% 0 0.25%
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Below BBB- or Below Baa3 or 1.50% 0.50% 0.50%
unrated unrated
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Term Loans
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S&P Rating Xxxxx'x Rating Applicable Applicable
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Percentage for Percentage for
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LIBOR Rate Alternate Base
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Loans Rate Loans
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BBB+ or higher Baa1 or higher 0.75% 0
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BBB Baa2 1.00% 0
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BBB- Baa3 1.25% 0
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Below BBB- or Below Baa3 or 2.00% 0.50%
unrated unrated
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Any change in the Borrower's Credit Rating causing it to move to a different
range on the table shall effect an immediate change in the Applicable
Percentage. The Borrower shall notify the Agent in writing promptly after
becoming aware of any change in any of its Credit Ratings. In order to qualify
for an Applicable Percentage based on its Credit Rating, the Borrower shall
maintain an Investment Grade Credit Rating from at least two nationally
recognized rating agencies, one of which must be Xxxxx'x or S&P; provided that
if the Borrower fails to maintain at least two Investment Grade Credit Ratings,
the Applicable Percentage shall be based upon an S&P rating of "Below BBB- or
unrated" in the tables above. In the event that the Borrower receives two Credit
Ratings that are not equivalent, the Applicable Percentage shall be based upon
the lower of the two Credit Ratings. In the event the Borrower receives more
than two Credit Ratings and such Credit Ratings are not equivalent, the
Applicable Percentage shall be
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based on the lower of the two highest Credit Ratings; provided that each of said
two highest Credit Ratings shall be Investment Grade Credit Ratings and at least
one of which shall be an Investment Grade Credit Rating from S&P or Xxxxx'x.
Subject to the foregoing, the equivalent Credit Rating from a nationally-
recognized rating agency other than S&P or Xxxxx'x may be used in place of the
Credit Ratings from S&P or Xxxxx'x in the above table.
"Asset Sale" shall mean, with respect to the Borrower or any Subsidiary,
any sale, transfer or other disposition of any assets or other properties
(including individual business assets, patents, trademarks and other
intangibles) of the Borrower or such Subsidiary, including the sale, transfer or
disposition of any capital stock of or any merger or consolidation involving any
Subsidiary and any issuance or sale by any Subsidiary of shares of its capital
stock, other than (i) sales of inventory and used equipment in the ordinary
course of business of the person (whether the Borrower or a Subsidiary) owning
and selling such inventory or used equipment; (ii) sales, transfers and other
dispositions of any tangible assets by the Borrower or any Subsidiary that have
become obsolete or if the Borrower or such Subsidiary enters into a purchase or
construction agreement with a third party to replace such assets with comparable
assets as soon as practicable (and in no event later than three months) after
the disposition and, pending such replacement, diligently pursues the
replacement thereof, and the fair market value of the replacement assets is
substantially equivalent to or exceeds that of the assets so disposed of; (iii)
sales, transfers and other dispositions of any assets to the Borrower or any
Subsidiary; (iv) Sale and Lease-Back Transactions; and (v) sales by the Borrower
or Subsidiaries of assets acquired from persons other than the Borrower or other
Subsidiaries, which sales occur not more than 12 months after the respective
dates on which such assets were acquired.
"Assignment and Acceptance" shall mean an assignment and acceptance entered
into by a Lender and an assignee, and accepted by the Agent, in the form of
Exhibit C.
"Baron Entities" shall mean the collective reference to Xxxxxx Xxxxx, Xxxxx
Capital Group, Inc., Baron Capital, Inc., BAMCO, Inc., Baron Capital Management
Inc., Baron Asset Fund and any of their respective Affiliates.
"Board" shall mean the Board of Governors of the Federal Reserve System of
the United States.
"Borrower" shall have the meaning assigned to such term in the recitals.
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"Borrowing" shall mean a group of Loans of the same Class and Type made by
the Lenders (or, in the case of a Competitive Borrowing, by the Lender or
Lenders whose Competitive Bids have been accepted pursuant to Section 2.03) on a
single date and as to which a single Interest Period is in effect.
"Borrowing Request" shall mean a request by the Borrower in accordance with
the terms of Section 2.04.
"Business Day" shall mean any day (other than a day which is a Saturday,
Sunday or legal holiday in the State of New York) on which banks are open for
business in New York City; provided, however, that (i) when used in connection
with a Eurodollar Loan, the term "Business Day" shall also exclude any day on
which banks are not open for dealings in dollar deposits in the London interbank
market and (ii) when used in connection with a Eurocurrency Loan, "Business Day"
shall also exclude any day on which commercial banks are not open for foreign
exchange business in London or, if such reference relates to the date on which
any amount is to be paid or made available in an Alternative Currency, in the
principal financial center in the country of such Alternative Currency.
"Calculation Date" shall mean the last Business Day of each fiscal quarter
of the Borrower or the date of a Sharing Event or the date of any redenomination
under Section 2.20(e).
"Capital Lease Obligations" of any person shall mean the obligations of
such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP
applied on a consistent basis and, for the purposes of this Agreement, the
amount of such obligations at any time shall be the capitalized amount thereof
at such time determined in accordance with GAAP applied on a consistent basis.
A "Change in Control" shall be deemed to have occurred if (a) any person or
group (within the meaning Rule 13d-5 of the Securities and Exchange Commission
as in effect on the date hereof) other than Xxxxxxx Xxxxxx and his family shall
own directly or indirectly, beneficially or of record, shares representing more
than 15% of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of the Borrower, except that such a person or group
may own directly or indirectly, beneficially or of record, shares representing
not more than 20%, or 33% in the case of the Baron Entities, of the aggregate
voting power represented by the issued and outstanding capital stock of the
Borrower if and so long as such person or group reports and continues to report
(i) such ownership on Schedule 13G (filed pursuant to Rule 13d-1(b), Rule
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13d-1(c), or, in the case of amendments, Rule 13d-2(b), of the Securities and
Exchange Commission as in effect on the date hereof) or (ii) in the case of the
Baron Entities only, the letter agreement dated February 4, 1998, between the
Borrower and the Baron Entities remains in effect and the Baron Entities are in
compliance therewith; (b) a majority of the seats (other than vacant seats) on
the board of directors of the Borrower shall at any time have been occupied by
persons who were neither (i) nominated by the management of the Borrower or by
the Nominating Committee of the Borrower's board of directors in connection with
an annual meeting of the stockholders of the Borrower, nor (ii) appointed by
directors so nominated; or (c) any person or group other than Xxxxxxx Xxxxxx and
his family shall otherwise directly or indirectly Control the Borrower.
Notwithstanding the foregoing, if a trust or foundation or other entity
established by Xxxxxxx Xxxxxx or his family holds shares representing in excess
of 15% of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of the Borrower and Xxxxxxx Xxxxxx or his family
Controls such trust or foundation or such other entity and the vote of such
shares held by such trust or foundation or such other entity and Xxxxxxx Xxxxxx
and his family remain in Control of the Borrower, there shall be no Change in
Control for purposes of this Agreement; provided, however, that any transfer of
such shares by Xxxxxxx Xxxxxx, such trust or such foundation or such other
entity shall stand on its own merits for purposes of this Agreement.
Notwithstanding the foregoing, no Change in Control will be deemed to have
occurred by virtue of the Baron Entities owning directly or indirectly,
beneficially or of record, shares representing greater than 33% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
the Borrower if the Baron Entities shall own greater than 33% of the capital
stock of the Borrower solely as a result of stock repurchases made by the
Borrower in the ordinary course of business, with no view toward increasing the
Baron Entities' relative ownership interest or otherwise changing control of the
Borrower; provided that the Baron Entities shall not have acquired directly or
indirectly, beneficially or of record, any shares of capital stock of the
Borrower since February 4, 1998, other than (i) pursuant to pro rata stock
splits and stock dividends made by the Borrower and (ii) that the Baron
Entities, as a whole, may at any time own the same aggregate number of shares of
capital stock of the Borrower that they own as of February 4, 1998 (after giving
effect to dispositions and repurchases by the Baron Entities).
"Class", when used in reference to any Loan or Borrowing, shall refer to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Tranche
A Loans, Revolving Tranche B Loans or Term Loans and, when used in reference to
any Commitment, shall refer to whether such Commitment is a
-8-
Revolving Tranche A Commitment, a Revolving Tranche B Commitment or a Term
Commitment.
"Code" shall mean the Internal Revenue Code of 1986, as the same may be
amended from time to time.
"Commitment" shall mean a Revolving Tranche A Commitment, a Revolving
Tranche B Commitment or a Term Commitment, or any combination thereof (as the
context requires).
"Competitive Bid" shall mean an offer by a Lender to make a Competitive
Loan pursuant to Section 2.03.
"Competitive Bid Accept/Reject Letter" shall mean a notification made by
the Borrower pursuant to Section 2.03 (d) in the form of Exhibit A-4.
"Competitive Bid Rate" shall mean, as to any Competitive Bid made by a
Lender pursuant to Section 2.03(b), (i) in the case of a Eurodollar Competitive
Loan, the Competitive Margin, and (ii) in the case of a Fixed Rate Loan, the
fixed rate of interest offered by the Lender making such Competitive Bid.
"Competitive Bid Request" shall mean a request made pursuant to Section
2.03 in the form of Exhibit A-1.
"Competitive Borrowing" shall mean a borrowing consisting of a Competitive
Loan or concurrent Competitive Loans from the Lender or Lenders whose
Competitive Bids for such Borrowing have been accepted by the Borrower under the
bidding procedure described in Section 2.03.
"Competitive Loan" shall mean a Loan from a Lender to the Borrower pursuant
to the bidding procedure described in Section 2.03. Each Competitive Loan shall
be a Eurodollar Competitive Loan or a Fixed Rate Loan.
"Competitive Margin" shall mean, as to any Eurodollar Competitive Loan, the
margin (expressed as a percentage rate per annum in the form of a decimal to no
more than four decimal places) to be added to or subtracted from the Adjusted
LIBO Rate in order to determine the interest rate applicable to such Loan, as
specified in the Competitive Bid relating to such Loan.
"Consolidated EBITDA" shall mean, for any period, the Consolidated Net
Income for such period taken as a single accounting period, plus (a) the sum of
----
the following amounts of the Borrower and its Subsidiaries for such period
determined on a consolidated basis in conformity with GAAP to the extent
included in the determination of such Consolidated Net Income: (i) depreciation
-9-
expense, (ii) amortization expense, (iii) interest expense, (iv) income tax
expense, and (v) other non-cash charges (other than any increase in the
allowance for doubtful accounts), less (b) the portion of such Consolidated
----
EBITDA attributable to any Subsidiary that is not a Guarantor.
"Consolidated Funded Indebtedness" means, as of any date of determination
without duplication, all obligations accounted for as indebtedness on a
consolidated balance sheet of the Borrower on such date, in accordance with GAAP
consistently applied, whether such obligations are classified as long-term or
short-term, and including in any event and without limitation, all Guaranties of
indebtedness of others and all obligations as an account party in respect of
letters of credit and bankers' acceptances; provided that all such obligations
of a Subsidiary that is not a Guarantor shall not be included in the
determination of Consolidated Funded Indebtedness.
"Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of (a) Consolidated EBITDA for such period to (b) Consolidated Interest
Expense for such period.
"Consolidated Interest Expense" shall mean, for any period without
duplication, gross total expenses of the Borrower and its consolidated
Subsidiaries accounted for as interest expense (including capitalized interest
determined in accordance with GAAP consistently applied) for such period,
including (i) the portion of rental payments under Capital Lease Obligations
deemed to represent interest in accordance with GAAP consistently applied, (ii)
the amortization of debt discounts, (iii) the amortization of all fees
(including fees with respect to interest rate protection agreements) payable in
connection with the incurrence of Indebtedness to the extent included in
interest expense, all as determined on a consolidated basis in accordance with
GAAP consistently applied. For purposes of the foregoing, (x) gross interest
expense shall be determined after giving effect to any net payments made or
received with respect to interest rate protection agreements entered in to as a
hedge against interest rate exposure and (y) the aggregate amount of such gross
interest expense of a Subsidiary which is not a Guarantor shall not be included
in the determination of Consolidated Interest Expense.
"Consolidated Leverage Ratio" shall mean the ratio of Consolidated Funded
Indebtedness to Consolidated EBITDA. In the event the Borrower shall complete,
directly or through a Subsidiary, an acquisition or divestiture of any person or
business unit during any period, the Consolidated Leverage Ratio as of the end
of and for such period shall thereafter be determined on a pro forma basis as if
such acquisition or divestiture had been completed on the first day of such
period.
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"Consolidated Net Income" shall mean, for any period, the net income (or
loss) of the Borrower and its consolidated Subsidiaries for such period, as
determined on a consolidated basis in accordance with GAAP consistently applied;
provided, however, that of interest income only cash interest income shall be
included in the determination of Consolidated Net Income.
"Consolidated Total Assets" shall mean, as at any date of determination,
the total assets of the Borrower and its consolidated Subsidiaries at such time,
as determined on a consolidated basis in accordance with GAAP consistently
applied, and including in any event and without limitation, the value of all
investments by the Borrower or any consolidated Subsidiary in any joint venture
or other person that is not consolidated with the Borrower in accordance with
GAAP.
"Control" shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a person,
whether through the ownership of voting securities, by contract or otherwise,
and "Controlling" and "Controlled" shall have meanings correlative, thereto;
provided, however, the existence of a management contract by the Borrower or one
of its Affiliates to manage another entity shall not be deemed to be Control.
"Credit Event" shall have the meaning assigned to such term in Section
4.01.
"Credit Parties" shall mean, collectively, the Borrower, the Subsidiary
Loan Parties and any other wholly-owned Subsidiary for which the Borrower has
legal liability for such wholly-owned Subsidiary's obligations and liabilities.
"Credit Rating" means the rating assigned by not less than two nationally-
recognized rating agencies reasonably satisfactory to the Agent (at least one of
which shall be S&P or Moody's) to the Borrower's senior long-term unsecured
indebtedness.
"Default" shall mean any event or condition which upon notice, lapse of
time or both would constitute an Event of Default.
"Designated Bank" shall mean a special purpose corporation that (i) shall
have become a party to this Agreement pursuant to Section 9.04(i), and (ii) is
not otherwise a Lender.
"Designated Bank Notes" shall mean promissory notes of the Borrower,
substantially in the form of Exhibit F hereto, evidencing the obligation of the
Borrower to repay Competitive Loans made by Designated Banks, as the same may be
amended, supplemented, modified or restated from time to time, and
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"Designated Bank Note" means any one of such promissory notes issued under
Section 9.04(i).
"Designating Lender" shall have the meaning set forth in Section 9.04 (i).
"Designation Agreement" shall mean a designation agreement in substantially
the form of Exhibit G attached hereto, entered into by a Lender and a Designated
Bank and accepted by the Agent.
"Deutsche Marks" shall mean the lawful money of the Federal Republic of
Germany.
"dollars" or "$" shall mean lawful money of the United States of America.
"Domestic Subsidiary" shall mean any Subsidiary that is organized under the
laws of the United States of America or any State thereof or the District of
Columbia.
"Effective Date" shall mean the date on and as of which each of the
conditions set forth in Section 4.02 shall have been satisfied.
"Equivalent Dollar Amount" shall mean, (a) with respect to any Borrowing
denominated in any Alternative Currency, the amount of dollars that would be
required to purchase the amount of the Alternate Currency of such Borrowing on
the date two Business Days prior to the date of such Borrowing (or in the case
of any determination made under Section 2.21 or redenomination under Section
2.20(e), on the date of determination or redenomination therein referred to),
based upon the Spot Exchange Rate and (b) with respect to any amount of dollars
on any date, such amount of dollars.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that is a member of a group of which the Borrower is a member and
which is treated as a single employer under Section 414 of the Code.
"Eurocurrency" when used in reference to any Loan or Borrowing shall refer
to whether such Loan, or Loans comprising such Borrowing, denominated in an
Alternative Currency are bearing interest at a rate determined by reference to
the LIBO Rate in accordance with the provisions of Article II.
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"Eurocurrency Sublimit" shall mean the lesser of (i) 33-1/3% of the Total
Revolving Commitment, (ii) $50,000,000 and (iii) the Total Revolving Tranche B
Commitment.
"Eurodollar", when used in reference to any Loan or Borrowing shall refer
to whether such Loan, or Loans comprising such Borrowing, denominated in dollars
are bearing interest at a rate determined by reference to the Adjusted LIBO Rate
in accordance with the provisions of Article II (or, in the case of a
Competitive Loan, the Adjusted LIBO Rate).
"Event of Default" shall have the meaning assigned to such term in Article
VII.
"Existing Credit Agreement" shall mean the Competitive Advance and Multi-
Currency Credit Facilities Agreement dated as of October 15, 1997, between
Choice Hotels International, Inc., The Chase Manhattan Bank, as Agent, Chase
Securities, Inc., as Arranger, and certain other lenders, as amended to date.
"Facility Fee" shall have the meaning assigned to such term in Section
2.06(a).
"Federal Funds Effective Rate" shall have the meaning assigned to such term
in the definition of "Alternate Base Rate".
"Fees" shall mean the Facility Fee, the Agent and Administrative Fees, the
L/C Facing Fee and the L/C Fee.
"Financial Officer" of any corporation shall mean the chief financial
officer, principal accounting officer, treasurer or controller of such
corporation.
"Fixed Rate Borrowing" shall mean a Borrowing comprised of Fixed Rate
Loans.
"Fixed Rate Loan" shall mean any Competitive Loan bearing interest at a
fixed percentage rate per annum (expressed in the form of a decimal to no more
than four decimal places) specified by the Lender making such Loan in its
Competitive Bid.
"Foreign Subsidiary" shall mean any Subsidiary that is organized under the
laws of a jurisdiction other than the United States of America or any State
thereof or the District of Columbia.
"French Francs" shall mean the lawful money of the Republic of France.
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"GAAP" shall mean generally accepted accounting principles in effect from
time to time in the United States of America.
"Governmental Authority" shall mean any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guarantee" of or by any person shall mean any obligation, contingent or
otherwise, of such person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other person (the "primary obligor") in any
manner, whether directly or indirectly, and including any obligation of such
person, direct or indirect, (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of such
Indebtedness, (b) to purchase property, securities or services for the purpose
of assuring the owner of such Indebtedness of the payment of such Indebtedness
or (c) to maintain working capital, equity capital or other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness; provided, however, that the term Guarantee
shall not include endorsements for collection or deposit, in either case in the
ordinary course of business.
"Guarantee Agreement" shall mean, collectively, the Guarantee Agreement,
substantially in the form of Exhibit E-1, between the Subsidiary Loan Parties
which are Domestic Subsidiaries and the Agent, and the Guarantee Agreement,
substantially in the form of Exhibit E-2, between the Subsidiary Loan Parties
which are Foreign Subsidiaries and the Agent.
"Guarantor" means any Subsidiary that is a party to the Guarantee
Agreement.
"Hotel Properties" shall mean the properties set forth on Schedule 1.01 and
any hotel properties acquired or constructed after the date hereof, including
fixtures and personalty associated therewith.
"Indebtedness" of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such person
upon which interest charges are customarily paid, (d) all obligations of such
person under conditional sale or other title retention agreements relating to
property or assets purchased by such person, (e) all obligations of such person
issued or assumed as the deferred purchase price of property or services, (f)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness
-14-
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such person, whether or not the obligations
secured thereby have been assumed (valued at the lesser of (a) the amount of
such Indebtedness or (b) if such Indebtedness is Non-Recourse to such person,
the fair market value of such property), (g) all Guarantees by such person of
Indebtedness of others, (h) all Capital Lease Obligations of such person, (i)
all obligations of such person in respect of interest rate protection
agreements, foreign currency exchange agreements or other interest or exchange
rate hedging arrangements, (j) all obligations of such person as an account
party in respect of letters of credit (other than (x) documentary letters of
credit (including commercial and trade letters of credit) issued to secure
payment obligations in respect of goods and services in the ordinary course of
business and (y) letters of credit and surety bonds with respect to obligations
of such person that are fully accounted for as liabilities in the financial
records of such person) and bankers' acceptances, (k) to the extent not
otherwise included, all obligations of such person under so-called forward
equity purchase contracts where such person is obligated to purchase or redeem
any shares of equity securities issued by such person, and (l) all obligations
of such person in respect of any so-called "synthetic lease" (i.e., a lease of
property which is treated as an operating lease under GAAP and as a loan or
financing for U.S. income tax purposes). The Indebtedness of any person shall
not include current accounts payable incurred in the ordinary course of
business. The Indebtedness of any person shall include the Indebtedness of any
partnership in which such person is a general partner.
"Interest Payment Date" shall mean, with respect to any Loan, the last day
of the Interest Period applicable thereto and, in the case of a Eurocurrency
Loan or Eurodollar Loan with an Interest Period of more than three months'
duration or a Fixed Rate Loan with an Interest Period of more than 90 days'
duration, each day that would have been an Interest Payment Date for such Loan
had successive Interest Periods of three months' duration or 90 days' duration,
as the case may be, been applicable to such Loan and, in addition, the date of
any refinancing or conversion of such Loan with or to a Loan of a different
Type.
"Interest Period" shall mean (a) as to any Eurocurrency Borrowing or
Eurodollar Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter, or if available to all Lenders, 9 or 12 months thereafter, as
the Borrower may elect, (b) as to any ABR Borrowing, the period commencing on
the date of such Borrowing and ending on the last Business Day of the calendar
quarter in which such Borrowing was made or, if earlier, on the Revolving
Maturity Date or Term Maturity Date, as applicable, or the date of prepayment of
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such Borrowing and (c) as to any Fixed Rate Borrowing, the period commencing on
the date of such Borrowing and ending on the date specified in the Competitive
Bids in which the offer to make the Fixed Rate Loans comprising such Borrowing
were extended, which shall not be earlier than seven days after the date of such
Borrowing or later than 360 days after the date of such Borrowing; provided,
however, that if any Interest Period would end on a day other than a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless, in the case of Eurocurrency Loans and Eurodollar Loans only, such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day. Interest
shall accrue from and including the first day of an Interest Period to but
excluding the last day of such Interest Period.
"Interest Rate Determination Date" shall mean, in relation to any period
for which an interest rate is to be determined with respect to a Eurodollar
Borrowing or Eurocurrency Borrowing:
(a) (if the currency is euro) two TARGET Days before the first day of that
period; or
(b) (for any other currency) two Business Days before the first day of that
period,
unless, in either case, market practice differs in the relevant interbank market
for a currency, in which case the Interest Rate Determination Date for that
currency will be determined by the Agent in accordance with market practice in
the relevant interbank market (and if quotations would normally be given by
leading banks in the relevant interbank market on more than one day, the
Interest Rate Determination Date will be the last of those days).
"Investment Grade Credit Rating" shall mean a Credit Rating of BBB- or
better from S&P, a Credit Rating of Baa3 or better from Moody's or a rating
equivalent to the foregoing from another nationally-recognized rating agency.
"Issuing Bank" shall mean, as the context may require, (a) The Chase
Manhattan Bank, or (b) any other Lender that may become an Issuing Bank pursuant
to Section 2.20(h), with respect to Letters of Credit issued by such Lender.
"L/C Disbursement" shall mean a payment or disbursement made by an Issuing
Bank pursuant to a Letter of Credit.
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"L/C Exposure" shall mean the sum of the L/C Tranche A Exposure and the L/C
Tranche B Exposure. The L/C Exposure of any Lender at any time shall mean the
sum of its L/C Tranche A Exposure and its L/C Tranche B Exposure at such time.
"L/C Tranche A Exposure" shall mean at any time the sum of (a) the
aggregate undrawn amount of all outstanding Tranche A Letters of Credit at such
time, plus (b) the aggregate principal amount of all L/C Disbursements relating
to Tranche A Letters of Credit that have not yet been reimbursed at such time.
The L/C Tranche A Exposure of any Lender at any time shall mean its Pro Rata
Percentage (based upon the Revolving Tranche A Commitments) of the aggregate L/C
Tranche A Exposure at such time.
"L/C Tranche B Exposure" shall mean at any time the sum of the Equivalent
Dollar Amount of (a) the aggregate undrawn amount of all outstanding Tranche B
Letters of Credit at such time, plus (b) the aggregate principal amount of all
L/C Disbursements relating to Tranche B Letters of Credit that have not yet been
reimbursed at such time. The L/C Tranche B Exposure of any Lender at any time
shall mean its Pro Rata Percentage (based upon the Revolving Tranche B
Commitments) of the aggregate L/C Tranche B Exposure at such time.
"L/C Facing Fee" shall have the meaning assigned to such term in Section
2.06(c)(ii).
"L/C Fee" shall have the meaning assigned to such term in Section
2.06(c)(i).
"Lender" shall mean (a) a person listed on Schedule 2.01 and any other
person that shall become a party hereto pursuant to an Assignment and
Acceptance, other than such person that ceases to be a party hereto pursuant to
an Assignment and Acceptance or (b) a Designated Bank; provided, however, that
the term "Lender" shall exclude each Designated Bank when used in reference to a
Standby Loan, the Revolving Commitments or terms relating to the Standby Loans
and the Revolving Commitments and shall further exclude each Designated Bank for
all other purposes hereunder except that any Designated Bank which funds a
Competitive Loan shall, subject to Section 9.4(i), have the rights (including,
without limitation, the rights given to a Lender contained in Article IX) and
obligations of a Lender associated with holding such Competitive Loan.
"Lender Affiliate" shall mean, (a) with respect to any Lender, (i) an
Affiliate of such Lender or (ii) any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
-17-
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by a Lender or an Affiliate of
such lender and (b) with respect to any Lender that is a fund which invests in
bank loans and similar extensions of credit, any other fund that invests in bank
loans and similar extensions of credit and is managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.
"Letter of Credit" shall mean any letter of credit issued pursuant to
Section 2.20, as permitted hereby.
"LIBO Rate" means, with respect to any Eurodollar Borrowing or Eurocurrency
Borrowing (other than Eurocurrency Borrowings denominated in Sterling) for any
Interest Period, the rate appearing on Page 3740 or Page 3750, as applicable, of
the Telerate Service (or on any successor or substitute page of such Service, or
any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Agent from time to time for purposes of providing quotations
of interest rates applicable to deposits in the applicable currency in the
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for deposits
in the applicable currency with a maturity comparable to such Interest Period.
In the event that such rate is not available at such time for any reason or in
the event of an Eurocurrency Borrowing denominated in Sterling, then the "LIBO
Rate" with respect to such Eurodollar Borrowing or Eurocurrency Borrowing for
such Interest Period shall be the rate at which deposits in the applicable
currency of $5,000,000 (or its Equivalent Dollar Amount) and for a maturity
comparable to such Interest Period are offered by the principal London office of
the Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, on the Interest Rate Determination Date.
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset and
(c) in the case of securities, any purchase option, call or similar right of a
third party (excluding rights of first refusal) with respect to such securities.
"Loans" shall mean the loans made by the Lenders to the Borrower pursuant
to this Agreement.
"Loan Documents" shall mean this Agreement, the Letters of Credit, the
Guarantee Agreement, if requested by a Lender pursuant to Section 2.07(e), each
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promissory note, and if applicable, any Designation Agreements and Designated
Bank Notes.
"Loan Parties" shall mean the Borrower and the Subsidiary Loan Parties.
"Margin Stock" shall mean "margin stock" or "margin securities" as such
terms are defined in Regulation U and Regulation X.
"Material Adverse Effect" shall mean a materially adverse effect on the
business, assets, property or condition, financial or otherwise, of the Borrower
and the Subsidiaries taken as a whole.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" shall mean a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate (other than one
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Section
414 of the Code) 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.
"Non-Recourse" shall mean, with reference to any obligation or liability of
any person, any obligation or liability for which such person is not liable or
obligated other than, if at all, as to its interest in a specifically identified
asset only, subject to such limited exceptions to the non-recourse nature of
such obligation or liability, such as fraud, misappropriation, misapplication
and environmental indemnities, as are usual and customary in like transactions
involving institutional lenders at the time of the incurrence of such obligation
or liability.
"Obligations" shall mean (a) the Borrower's obligations in respect of the
due and punctual payment of principal of and interest on the Loans and
reimbursement of the L/C Disbursements, in each case when and as due whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (b) all Fees, expenses, indemnities, reimbursements and other
obligations, monetary or otherwise, of the Borrower under this Agreement or any
other Loan Document, (c) all obligations, monetary or otherwise, of each
Subsidiary under each Loan Document to which it is a party and (d) unless
otherwise agreed upon in writing by the applicable Lender party thereto, all
obligations of the Borrower, monetary or otherwise, under each interest rate
protection agreement entered into with a counterparty that was a Lender (or an
Affiliate thereof) at the time such interest rate protection agreement was
entered into.
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"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.
"Permitted Liquid Investments" shall mean:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed
by the full faith and credit of the United States of America);
(b) investments in commercial paper having credit ratings of at least
A-2 from S&P and P-2 from Moody's;
(c) investments in certificates of deposit, bankers acceptances and
time deposits issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any
commercial bank organized under the laws of the United States of America or
any State thereof which has a combined capital and surplus and undivided
profits of not less than $200,000,000;
(d) investments in the ordinary course of business in customary
repurchase agreements with respect to freely marketable, short-term
securities of the type customarily subject to repurchase agreements; and
(e) other readily marketable debt and equity securities traded on
national securities exchanges or on other nationally recognized markets,
including over-the-counter markets.
"person" shall mean any natural person, corporation, business trust, joint
venture, association, company, limited liability company, partnership or
government, or any agency or political subdivision thereof.
"Plan" shall mean any pension plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code which
is maintained for employees of the Borrower or any ERISA Affiliate.
"Pro Rata Percentage" of any Lender at any time shall mean the percentage
of the total Term Commitment, Total Tranche A Revolving Commitment, Total
Tranche B Revolving Commitment, Total Revolving Commitment represented by such
Lender's Term Commitment, Revolving Tranche A Commitment, Revolving Tranche B
Commitment or Revolving Commitment. In the event such Commitments shall have
expired or been terminated, the Pro Rata Percentages shall be determined on the
basis of
-20-
applicable Commitments most recently in effect (giving effect to any assignments
under Section 9.04).
"Proprietary Information" shall have the meaning given such term in Section
9.16.
"Recourse" shall mean, with reference to any obligation or liability of any
person, any liability or obligation that is not Non-Recourse to such person.
"Reference Bank" shall mean the Agent.
"Register" shall have the meaning given such term in Section 9.04(d).
"Regulation D" shall mean Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation U" shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation X" shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Reportable Event" shall mean any reportable event as defined in Section
4043 (c) of ERISA or the regulations issued thereunder with respect to a Plan
(other than a Plan maintained by an ERISA Affiliate which is considered an ERISA
Affiliate only pursuant to subsection (m) or (o) of Section 414 of the Code).
"Required Lenders" shall mean, at any time, Lenders having Commitments
representing at least a majority of the aggregate Commitments or, if the
Commitments have been terminated, Lenders holding Loans and L/C Exposures
representing at least a majority of the sum of the aggregate amount of L/C
Exposures and aggregate principal amount of the Loans then outstanding.
"Responsible Officer" of any corporation shall mean any executive officer
or Financial Officer of such corporation and any other officer or similar
official thereof responsible for the administration of the obligations of such
corporation in respect of this Agreement.
"Revolving Availability Period" shall mean the period from and including
the Effective Date to but excluding the earlier of the Revolving Maturity Date
and the date of termination of the Revolving Commitments.
"Revolving Borrowing" shall mean a Borrowing of Revolving Loans.
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"Revolving Commitment" shall mean, with respect to each Lender, the sum of
its Revolving Tranche A Commitment and its Revolving Tranche B Commitment.
"Revolving Lender" shall mean a Lender with a Revolving Commitment or, if
the Revolving Commitments have terminated or expired, a Lender with a Standby
Exposure.
"Revolving Loan" shall mean a Standby Loan or a Competitive Loan.
"Revolving Maturity Date" shall mean June 29, 2006.
"Revolving Tranche A Commitment" shall mean, with respect to each Lender,
the commitment, if any, of such Lender to make Standby Tranche A Loans and to
acquire participations in Tranche A Letters of Credit hereunder, expressed as an
amount representing the maximum aggregate amount of such Lender's Revolving
Tranche A Usage hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.11 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender's Revolving Tranche A Commitment is set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender
shall have assumed its Revolving Tranche A Commitment, as applicable. The
initial aggregate amount of the Lenders' Revolving Tranche A Commitments is
$73,333,333.33.
"Revolving Tranche A Usage" shall mean, with respect to each Lender, the
sum of its Standby Tranche A Exposure plus the amount by which the Competitive
Loans outstanding at such time shall be deemed to have used such Lender's
Revolving Tranche A Commitment pursuant to Section 2.16.
"Revolving Tranche B Commitment" shall mean, with respect to each Lender,
the commitment, if any, of such Lender to make Standby Tranche B Loans and to
acquire participations in Tranche B Letters of Credit hereunder, expressed as an
amount representing the maximum aggregate amount of such Lender's Revolving
Tranche B Usage hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.11 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender's Revolving Tranche B Commitment is set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender
shall have assumed its Revolving Tranche B Commitment, as applicable. The
initial aggregate amount of the Lenders' Revolving Tranche B Commitments is
$36,666,666.67.
-22-
"Revolving Tranche B Usage" shall mean, with respect to each Lender, the
sum of its Standby Tranche B Exposure plus the amount by which the Competitive
Loans outstanding at such time shall be deemed to have used such Lender's
Revolving Tranche B Commitment pursuant to Section 2.16.
"Sale and Lease-Back Transaction" shall mean any arrangement, directly or
indirectly, with any person whereby such person shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred.
"S&P" shall mean Standard & Poor's Ratings Group, a division of XxXxxx-
Xxxx, Inc.
"Sharing Event" shall mean (i) the occurrence of an Event of Default with
respect to the Borrower or a Guarantor pursuant to clauses (g) or (h) of Article
VII, (ii) the termination of the Commitments pursuant to Article VII or (iii)
the acceleration of the Loans pursuant to Article VII.
"Spot Exchange Rate" shall mean on the day two Business Days prior to any
Calculation Date with respect to any Alternative Currency (i) the rate appearing
on the relevant display page (as determined by the Agent) on the Reuters Monitor
Money Rates Service for the sale of such Alternative Currency for dollars in the
London foreign exchange market at approximately 11 a.m. London time for delivery
two days later, or, if not available, (ii) the spot selling rate at which the
Agent offers to sell such Alternative Currency for dollars in the London foreign
exchange market at approximately 11:00 a.m. London time for delivery two
Business Days later; provided, however, that if, at the time of any such
determination, no such spot rate can reasonably be quoted, the Agent may use any
method (including obtaining quotes from two (2) or more market makers for the
applicable Alternative Currency) as it deems applicable to determine such rate,
and such determination shall be conclusive absent manifest error.
"Standby Borrowing" shall mean a Revolving Borrowing consisting of
simultaneous Standby Loans from each of the applicable Revolving Lenders.
"Standby Borrowing Request" shall mean a request made pursuant to Section
2.04 in the form of Exhibit A-5.
"Standby Exposure" shall mean with respect to any Lender at any time, the
sum of its Standby Tranche A Exposure and its Standby Tranche B Exposure.
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"Standby Loans" shall mean, collectively, the Standby Tranche A Loans and
the Standby Tranche B Loans.
"Standby Tranche A Exposure" shall mean with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Standby
Tranche A Loans denominated in dollars, plus its L/C Tranche A Exposure at such
time.
"Standby Tranche B Exposure" shall mean with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Standby
Tranche B Loans denominated in dollars, plus the Equivalent Dollar Amount at
such time of the outstanding principal amount at such time of such Lender's
Standby Tranche B Loans that are Alternative Currency Loans and its L/C Tranche
B Exposure at such time.
"Standby Tranche A Loans" shall mean the Loans made by the Lenders to the
Borrower pursuant to clause (b) of Section 2.01 and to Section 2.04. Each
Standby Tranche A Loan shall be a Eurodollar Standby Loan or an ABR Loan.
"Standby Tranche B Loans" shall mean the Loans made by the Lenders to the
Borrower pursuant to clause (c) of Section 2.01 and to Section 2.04. Each
Standby Tranche B Loan shall be a Eurocurrency Loan, a Eurodollar Standby Loan
or an ABR Loan.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Agent is subject with respect to the
Adjusted LIBO Rate, for eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve
Rate shall be adjusted automatically on and as of the effective date of any
change in any reserve percentage.
"Sterling" or "(Pounds)" shall mean the lawful money of the United Kingdom.
"subsidiary" shall mean with respect to any person, any corporation,
association, joint venture, partnership or other business entity (whether now
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existing or hereafter organized) of which at least a majority of the voting
stock or other ownership interests having ordinary voting power for the election
of directors (or the equivalent) is, at the time as of which any determination
is being made, directly or indirectly owned or controlled by such person or one
or more subsidiaries of such person or by such person and one or more
subsidiaries of such person.
"Subsidiary" shall mean any subsidiary of the Borrower.
"Subsidiary Loan Party" shall mean (a) any Domestic Subsidiary that has
assets greater than or equal to 10% of Consolidated Total Assets, (b) any
Subsidiary that directly or indirectly owns any capital stock of any Subsidiary
referred to in clause (a) (other than a Foreign Subsidiary which is not required
to become a party to the Guarantee Agreement to make enforceable under
applicable law the Guarantee Agreement of any Subsidiary referred to in clause
(a)), (c) any Foreign Subsidiary that has assets greater than or equal to 15% of
Consolidated Total Assets, (d) any Subsidiary that directly or indirectly owns
any capital stock of any Subsidiary referred to in clause (c) (other than a
Foreign Subsidiary which is not required to become a party to the Guarantee
Agreement to make enforceable under applicable law the Guarantee Agreement of
any Subsidiary referred to in clause (c)), and (e) any other Subsidiary that is
a Guarantor.
"TARGET" shall mean Trans-European Automated Real-time Gross Settlement
Express Transfer payment system.
"TARGET Day" shall mean any day on which TARGET is open for the settlement
of payments in Euros.
"Term Commitment" shall mean, with respect to each Lender, the commitment,
if any, of such Lender to make a Term Loan hereunder on the Effective Date, as
such commitment may be (a) reduced from time to time pursuant to Section 2.11
and (b) reduced or increased from time to time pursuant to assignments by or to
such Lender pursuant to Section 9.04. The initial amount of each Lender's Term
Commitment is set forth on Schedule 2.01, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Term Commitment, as
applicable. The initial aggregate amount of the Lenders' Term Commitments is
US$150,000,000.
"Term Lender" shall mean a Lender with a Term Commitment or an outstanding
Term Loan.
"Term Loan" shall mean a Loan made pursuant to clause (a) of Section 2.01.
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"Term Maturity Date" shall mean June 29, 2006.
"Total Revolving Commitment" shall mean at any time the aggregate amount of
the Lenders' Revolving Commitments, as in effect at such time.
"Total Revolving Tranche A Commitment" shall mean at any time the aggregate
amount of the Lenders' Revolving Tranche A Commitments, as in effect at such
time.
"Total Revolving Tranche B Commitment" shall mean at any time the aggregate
amount of the Lenders' Revolving Tranche B Commitments, as in effect at such
time.
"Tranche A Letter of Credit" shall mean any Letter of Credit issued against
the Total Revolving Tranche A Commitment pursuant to Section 2.20, as permitted
hereby.
"Tranche B Letter of Credit" shall mean any Letter of Credit issued against
the Total Revolving Tranche B Commitment pursuant to Section 2.20, as permitted
hereby.
"Transactions" shall have the meaning assigned to such term in Section
3.02.
"Type", when used in respect of any Loan or Borrowing, shall refer to the
Rate by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined and the currency in which such Loan or the Loans
comprising such Borrowing are denominated. For purposes hereof, "Rate" shall
include the Adjusted LIBO Rate, the Alternate Base Rate and the Fixed Rate, and
"currency" shall include Dollars, French Francs, Deutsche Marks, Sterling and
any other Alternative Currency permitted hereunder.
"Wholly Owned Subsidiary" shall mean a Subsidiary all the capital stock or
other ownership interest of which is owned by the Borrower or a Wholly Owned
Subsidiary of the Borrower (including any Subsidiary that would be wholly owned
but for directors' qualifying shares or similar matters).
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of this
--------------------------------------
Agreement, Loans may be classified and referred to by Class (e.g., a "Revolving
Tranche A Loan") or by Type (e.g., a "Eurodollar Loan") or by Class
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and Type (e.g., a "Eurodollar Revolving Tranche A Loan"). Borrowings also may be
classified and referred to by Class (e.g., a "Revolving Tranche A Borrowing") or
by Type (e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., a
"Eurodollar Tranche A Revolving Borrowing").
SECTION 1.03. Terms Generally. The definitions herein shall apply equally
---------------
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". All references herein to
Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP consistently applied, as in effect from time to time;
provided, however, that, for purposes of determining compliance with any
covenant set forth in Article VI, such terms shall be construed in accordance
with GAAP as in effect on the date of this Agreement applied on a basis
consistent with the application used in preparing the Borrower's audited
financial statements referred to in Section 3.05.
ARTICLE II. THE CREDITS
SECTION 2.01. Commitments. Subject to the terms and conditions and relying
-----------
upon the representations and warranties herein set forth, each Lender agrees,
severally and not jointly, (a) to make a Term Loan to the Borrower on the
Effective Date in a principal amount not exceeding its Term Commitment, (b) to
make Standby Tranche A Loans to the Borrower, at any time and from time to time
during the Revolving Availability Period, in an aggregate principal amount at
any time outstanding that will not result in such Lender's Revolving Tranche A
Usage exceeding such Lender's Revolving Tranche A Commitment, and (c) to make
Standby Tranche B Loans (including Eurocurrency Loans) to the Borrower, at any
time and from time to time during the Revolving Availability Period, in an
aggregate principal amount at any time outstanding that will not result in such
Lender's Revolving Tranche B Usage exceeding such Lender's Revolving Tranche B
Commitment, subject, however, to the conditions that (i) at no time shall any
Loan be made if, immediately after giving effect thereto and to the application
of the proceeds thereof, (x) the Aggregate Principal Amount Outstanding would
exceed the Total Revolving Commitment minus the L/C Exposure (y) the aggregate
Revolving Tranche A Usage of all Lenders would exceed the Total Revolving
Tranche A Commitment, or (z) the aggregate Revolving Tranche B Usage of all
Lenders would exceed the Total Revolving Tranche B Commitment,
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(ii) at no time shall any Loan be made or refinanced if, immediately after
giving effect thereto and to the application of the proceeds thereof, the sum of
(A) the aggregate Equivalent Dollar Amount of all outstanding Eurocurrency Loans
plus (B) the aggregate undrawn Equivalent Dollar Amount of all outstanding
Alternative Currency Letters of Credit would exceed the Eurocurrency Sublimit
and (iii) at all times the outstanding aggregate principal amount of all Loans
of any Class made by each Lender shall equal such Lender's Pro Rata Percentage
of all Loans of such Class. Within the foregoing limits, the Borrower may
borrow, pay or prepay and reborrow Standby Loans hereunder, on and after the
Effective Date and prior to the Revolving Maturity Date, subject to the terms,
conditions and limitations set forth herein. Amounts repaid in respect of Term
Loans may not be reborrowed.
SECTION 2.02. Loans. (a) Each Loan shall be made as part of a Borrowing
-----
consisting of Loans of the same Class and Type made by the Lenders ratably in
accordance with their respective Commitments of the applicable Class; provided,
however, that the failure of any Lender to make any Loan shall not in itself
relieve any other Lender of its obligation to lend hereunder (it being
understood, however, that no Lender shall be responsible for the failure of any
other Lender to make any Loan required to be made by such other Lender). Each
Competitive Loan shall be made in accordance with the procedures set forth in
Section 2.03. Except for Loans deemed made pursuant to Section 2.02(e), the
Standby Loans or Competitive Loans comprising any Revolving Borrowing shall be
(i) in the case of Competitive Loans, in an aggregate principal amount which is
an integral multiple of $1,000,000 and not less than $1,000,000, (ii) in the
case of ABR Standby Loans, in an aggregate principal amount which is an integral
multiple of $100,000 and not less than $300,000 (or an aggregate principal
amount equal to the remaining balance of the available Revolving Tranche A
Commitments or Revolving Tranche B Commitments, as applicable) and (iii) in the
case of Eurodollar Standby Loans or Eurocurrency Loans, in an aggregate
principal amount which is an integral multiple of the Equivalent Dollar Amount
of $1,000,000 and not less than the Equivalent Dollar Amount of $3,000,000 (or
an aggregate principal amount equal to the remaining balance of the available
Revolving Commitments). Notwithstanding any other provision of this Agreement to
the contrary, (a) each Revolving Borrowing denominated in dollars (whether
bearing interest at the Adjusted LIBO Rate, the Alternate Base Rate or a Fixed
Rate) shall be a Standby Tranche A Loan and shall be deemed to use the Revolving
Tranche A Commitments, unless the Revolving Tranche A Commitments have been
fully used and are not available at such time for such Borrowing, in which case
such Revolving Borrowing denominated in dollars shall be a Standby Tranche B
Loan and shall be deemed to use the Revolving Tranche B Commitments, if such
Revolving Tranche B Commitments are available, and (b)
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each Revolving Eurocurrency Borrowing shall be a Standby Tranche B Loan and
shall be deemed to use the Revolving Tranche B Commitments, if such Revolving
Tranche B Commitments are available.
(b) Subject only to Section 2.10, (i) each Term Borrowing shall be
comprised of Eurodollar Term Loans or ABR Loans as the Borrower may request
pursuant to Section 2.04, (ii) each Standby Borrowing shall be comprised of
Eurocurrency Loans, Eurodollar Standby Loans or ABR Loans as the Borrower may
request pursuant to Section 2.04 and (iii) each Competitive Borrowing shall be
comprised of Eurodollar Competitive Loans or Fixed Rate Loans as the Borrower
may request pursuant to Section 2.03. Each Lender may at its option make any
Eurocurrency Loan or Eurodollar Loan by causing any domestic or foreign branch
or Affiliate of such Lender to make such Loan; provided, however, that (i) any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms of this Agreement and (ii) in exercising
such option, the Lender shall use its reasonable efforts to minimize any
increased costs to the Borrower resulting therefrom (which obligation of the
Lender shall not require it to take, or refrain from taking, actions that it
determines would result in increased costs for which it will not be compensated
hereunder or that it determines would be otherwise disadvantageous to it and in
the event of such request for costs for which compensation is provided under
this Agreement, the provisions of Section 2.13(c) shall apply). Borrowings of
more than one Type may be outstanding at the same time; provided, however, that
the Borrower shall not be entitled to request any Borrowing which, if made,
would result in an aggregate of more than fifteen separate Standby Loans of any
Lender being outstanding hereunder at any one time. For purposes of the
foregoing, Loans having different Interest Periods, regardless of whether they
commence on the same date, shall be considered separate Loans.
(c) Subject to Section 2.05 and except with respect to Loans made pursuant
to Section 2.02(e), each Lender shall make each Loan to be made by it hereunder
on the proposed date thereof by wire transfer of immediately available funds to
such account as the Agent may designate, not later than 12:00 noon, New York
City time, or, in the case of any ABR Loan, 2:00 p.m., New York City time, or,
in the case of funds in an Alternative Currency, 12:00 noon, London time, and
the Agent shall by 3:00 p.m., New York City time, or, in the case of funds in an
Alternative Currency, 3:00 p.m., London time, credit the amounts so received to
an account designated by the Borrower with the Agent or, if a Borrowing shall
not occur on such date because any condition precedent herein specified shall
not have been met, return the amounts so received to the respective Lenders.
Competitive Loans shall be made by the Lender or Lenders whose Competitive Bids
therefor are accepted pursuant to Section 2.03 in the amounts so accepted
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and Standby Loans shall be made by the Lenders pro rata in accordance with
Section 2.16. Unless the Agent shall have received notice from a Lender prior to
(or, in the case of an ABR Borrowing, on) the date of any Borrowing that such
Lender shall not make available to the Agent such Lender's portion of such
Borrowing, the Agent may assume that such Lender has made such portion available
to the Agent on the date of such Borrowing in accordance with this Section
2.02(c) and the Agent may, in reliance, upon such assumption, make available to
the Borrower on such date a corresponding amount. If the Agent shall have so
made funds available then, to the extent that such Lender shall not have made
such portion available to the Agent, such Lender and the Borrower severally
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the Agent at
(i) in the case of the Borrower, the interest rate applicable at the time to the
Loans comprising such Borrowing and (ii) in the case of such Lender, a rate
determined by the Agent to represent its cost of overnight or short-term funds
in the relevant currency (which determination shall be conclusive absent
manifest error). If such Lender shall repay to the Agent such corresponding
amount, such amount shall constitute such Lender's Loan as part of such
Borrowing for purposes of this Agreement.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Borrowing if the Interest Period requested
with respect thereto would end after the Revolving Maturity Date.
(e) If the Issuing Bank shall not have received from the Borrower the
payment required to be made by Section 2.20(e) in respect of any L/C
Disbursement within the time specified in such Section, the Issuing Bank will
promptly notify the Agent of the L/C Disbursement and the Agent will promptly
notify each Lender of such L/C Disbursement and its Pro Rata Percentage thereof,
if any. Each Lender shall pay by wire transfer of immediately available funds
to the Agent not later than 2:00 p.m., New York City time, on such date (or, if
such Lender shall have received such notice later than 12:00 (noon), New York
City time, on any day, not later than 10:00 a.m., New York City time, on the
immediately following Business Day), an amount equal to such Lender's Pro Rata
Percentage of the Equivalent Dollar Amount of such L/C Disbursement (it being
understood that such amount shall be deemed to constitute an ABR Loan of such
Lender and such payment shall be deemed to have reduced the Tranche A L/C
Exposure or L/C Tranche B Exposure, as applicable), and the Agent will promptly
pay to the Issuing Bank amounts so received by it from the Lenders. The Agent
will promptly pay to the Issuing Bank any amounts received by it from the
Borrower pursuant to Section 2.20(e) prior to the time that any Lender makes any
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payment pursuant to this paragraph (e); any such amounts received by the Agent
thereafter will be promptly remitted by the Agent to the Lenders that shall have
made such payments and to the Issuing Bank, as their interests may appear. If
any Lender shall not have made its Pro Rata Percentage of such L/C Disbursement
available to the Agent as provided above, such Lender and the Borrower severally
agree to pay interest on such amount, for each day from and including the date
such amount is required to be paid in accordance with this paragraph to but
excluding the date such amount is paid, to the Agent for the account of the
Issuing Bank at (i) in the case of the Borrower, the Alternate Base Rate plus
the Applicable Percentage and (ii) in the case of such Lender, for the first
such day, the Federal Funds Effective Rate, and for each day thereafter, the
Alternate Base Rate.
SECTION 2.03. Competitive Bid Procedure. (a) In order to request
-------------------------
Competitive Bids, the Borrower shall hand deliver or telecopy to the Agent a
duly completed Competitive Bid Request in the form of Exhibit A-1, to be
received by the Agent (i) in the case of a Eurodollar Competitive Borrowing, not
later than 10:00 a.m., New York City time, four Business Days before a proposed
Competitive Borrowing and (ii) in the case of a Fixed Rate Borrowing, not later
than 10:00 a.m., New York City time, one Business Day before a proposed
Competitive Borrowing. No Eurocurrency Loan or ABR Loan shall be requested in,
or made pursuant to, a Competitive Bid Request. A Competitive Bid Request that
does not conform substantially to the format of Exhibit A-1 may be rejected in
the Agent's sole discretion, and the Agent shall promptly notify the Borrower of
such rejection by telecopier. Such request shall in each case refer to this
Agreement and specify (x) whether the Borrowing then being requested is to be a
Eurodollar Borrowing or a Fixed Rate Borrowing, (y) the date of such Borrowing
(which shall be a Business Day) and the aggregate principal amount thereof which
shall be in a minimum principal amount of $1,000,000 and in an integral multiple
of $1,000,000 and which amount, when combined with all outstanding Competitive
Loans, shall not exceed 50% of the Total Revolving Commitment, and (z) the
Interest Period with respect thereto (which may not end after the Revolving
Maturity Date). The Borrower may not request Competitive Borrowings with more
than three different Interest Periods in any Competitive Bid Request. Promptly
after its receipt of a Competitive Bid Request that is not rejected as
aforesaid, the Agent shall invite by telecopier (in the form of Exhibit A-2) the
Lenders to bid, on the terms and conditions of this Agreement, to make
Competitive Loans pursuant to such Competitive Bid Request.
(b) Each Lender may, in its sole discretion, make one or more Competitive
Bids to the Borrower responsive to a Competitive Bid Request. Each Competitive
Bid by a Lender must be received by the Agent via telecopier, in the
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form of Exhibit A-3, (i) in the case of a Eurodollar Competitive Borrowing, not
later than 9:30 a.m., New York City time, three Business Days before a proposed
Competitive Borrowing and (ii) in the case of a Fixed Rate Borrowing, not later
than 9:30 a.m., New York City time, on the day of a proposed Competitive
Borrowing. Multiple bids shall be accepted by the Agent. Competitive Bids that
do not conform substantially to the format of Exhibit A-3 may be rejected by the
Agent and the Agent shall notify the Lender making such nonconforming bid of
such rejection as soon as practicable. Competitive Loans to be funded by a
Competitive Bid may, as provided in Section 9.04(i), be funded by a Lender's
Designated Bank. A Lender making a Competitive Bid may, but shall not be
required to, specify in its Competitive Bid whether the related Competitive
Loans are intended to be funded by such Lender's Designated Bank, as provided in
Section 9.04(i). Each Competitive Bid shall refer to this Agreement and specify
(x) the principal amount (which shall be in a minimum principal amount of
$1,000,000 and in an integral multiple of $1,000,000 and which may equal the
entire principal amount of the Competitive Borrowing requested by the Borrower)
of the Competitive Loan or Loans that the Lender is willing to make to the
Borrower, (y) the Competitive Bid Rate or Rates at which the Lender is prepared
to make the Competitive Loan or Loans and (z) the Interest Period and the last
day thereof. A Competitive Bid submitted by a Lender pursuant to this Section
2.03(b) shall be irrevocable.
(c) The Agent shall promptly notify the Borrower by telecopier of all the
Competitive Bids made, the Competitive Bid Rate and the principal amount of each
Competitive Loan in respect of which a Competitive Bid was made and the identity
of the Lender that made each bid. The Agent shall send a copy of all
Competitive Bids to the Borrower for its records as soon as practicable after
completion of the bidding process set forth in this Section.
(d) The Borrower may in its sole and absolute discretion, subject only to
the provisions of this Section 2.03(d), accept or reject any Competitive Bid
referred to in Section 2.03(c). The Borrower shall notify the Agent by
telephone, confirmed by telecopier in the form of a Competitive Bid
Accept/Reject Letter substantially in the form set forth in Exhibit A-4, whether
and to what extent it has decided to accept or reject any of or all the bids
referred to in Section 2.03(c), (y) in the case of a Eurodollar Competitive
Borrowing, not later than 10:30 a.m., New York City time, three Business Days
before a proposed Competitive Borrowing and (z) in the case of a Fixed Rate
Borrowing, not later than 10:30 a.m., New York City time, on the day of a
proposed Competitive Borrowing; provided , however, that (i) the failure by the
Borrower to give such notice shall be deemed to be a rejection of all the bids
referred to in Section 2.03(c), (ii) the Borrower shall not accept a bid made at
a particular Competitive Bid Rate if the
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Borrower has decided to reject a bid made at a lower Competitive Bid Rate for
the same amount and Interest Period, (iii) the aggregate amount of the
Competitive Bids accepted by the Borrower shall not exceed the principal amount
specified in the Competitive Bid Request, (iv) if the Borrower shall accept a
bid or bids made at a particular Competitive Bid Rate but the amount of such bid
or bids shall cause the total amount of bids to be accepted by the Borrower to
exceed the amount specified in the Competitive Bid Request, then the Borrower
shall accept a portion of such bid or bids in an amount equal to the amount
specified in the Competitive Bid Request less the amount of all other
Competitive Bids accepted with respect to such Competitive Bid Request, which
acceptance, in the case of multiple bids at such Competitive Bid Rate, shall be
made pro rata in accordance with the amount of each such bid at such Competitive
Bid Rate, and (v) except pursuant to clause (iv) above, no bid shall be accepted
for a Competitive Loan unless such Competitive Loan is in a minimum principal
amount of $1,000,000 and an integral multiple of $1,000,000; provided further,
however, that if a Competitive Loan must be in an amount less than $1,000,000
because of the provisions of clause (iv) above, such Competitive Loan may be for
a minimum of $1,000,000 or any integral multiple thereof, and in calculating the
pro rata allocation of acceptances of portions of multiple bids at a particular
Competitive Bid Rate pursuant to clause (iv) above the amounts shall be rounded
to integral multiples of $1,000,000 in a manner which shall be in the discretion
of the Borrower. Notwithstanding any of the foregoing provisions in this Section
2.3(d), no bid shall be accepted for a Competitive Loan if after giving affect
to such Competitive Loan the amount of all Competitive Loans then outstanding
would exceed 50% of the Total Revolving Commitment. A notice given by the
Borrower pursuant to this Section 2.03(d) shall be irrevocable.
(e) The Agent shall promptly notify each bidding Lender whether or not its
Competitive Bid has been accepted (and if so, in what amount and at what
Competitive Bid Rate) by telecopier sent by the Agent, and each successful
bidder shall thereupon become bound, subject to the other applicable conditions
hereof, to make the Competitive Loan in respect of which its bid has been
accepted. A Lender who is notified that it has been selected to make a
Competitive Loan may designate its Designated Bank (if any) to fund such
Competitive Loan on its behalf, as described in Section 9.4(i). Any Designated
Bank which funds a Competitive Loan shall on and after the time of such funding
become the obligee in respect of such Competitive Loan and be entitled to
receive payment thereof when due.
(f) A Competitive Bid Request shall not be made within three Business Days
after the date of any previous Competitive Bid Request.
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(g) If the Agent shall elect to submit a Competitive Bid in its capacity as
a Lender, it shall submit such bid directly to the Borrower one quarter of an
hour earlier than the latest time at which the other Lenders are required to
submit their bids to the Agent pursuant to Section 2.03(b).
(h) All Notices required by this Section shall be given in accordance with
Section 9.01.
SECTION 2.04. Term Borrowing and Standby Borrowing Procedures. In order to
-----------------------------------------------
request a Borrowing (other than a Competitive Borrowing or a deemed Borrowing
pursuant to Section 2.02(e), as to which this Section 2.04 shall not apply), the
Borrower shall hand deliver or telecopy to the Agent a duly completed Borrowing
Request in the form of Exhibit A-5 (a) in the case of a Eurocurrency Borrowing,
not later than 10:30 a.m., London time, three Business Days before a proposed
borrowing, (b) in the case of a Eurodollar Borrowing, not later than 10:30 a.m.,
New York City time, three Business Days before a proposed borrowing and (c) in
the case of an ABR Borrowing, not later than 12:00 p.m. (noon), New York City
time, on the day of a proposed borrowing. No Fixed Rate Loan shall be requested
or made pursuant to a Borrowing Request. Such notice shall be irrevocable and
shall in each case specify (i) whether the Borrowing then being requested is to
be a Term Borrowing or a Standby Borrowing, and if a Standby Borrowing, whether
such Borrowing will be a Standby Tranche A Borrowing or a Standby Tranche B
Borrowing; (ii) whether such Borrowing is to be a Eurocurrency Borrowing, a
Eurodollar Borrowing or an ABR Borrowing; (iii) the date of such Borrowing
(which shall be a Business Day) and the amount thereof; (iv) if such Borrowing
is to be a Eurocurrency Borrowing, the Alternative Currency in which such
Borrowing is to be denominated and the number and location of the account to
which funds are to be disbursed; and (v) if such Borrowing is to be a
Eurocurrency Borrowing or Eurodollar Borrowing, the Interest Period with respect
thereto. If no election as to the Type of Borrowing is specified in any such
notice, then the requested Borrowing shall be an ABR Borrowing. If no Interest
Period with respect to any Eurocurrency Borrowing or Eurodollar Borrowing is
specified in any such notice, then the Borrower shall be deemed to have selected
an Interest Period of one month's duration, in the case of a Eurocurrency
Borrowing or a Eurodollar Borrowing. If the Borrower shall not have given notice
in accordance with this Section of its election to refinance a Borrowing
denominated in dollars prior to the end of the Interest Period in effect for
such Borrowing, then the Borrower shall (unless such Borrowing is repaid at the
end of such Interest Period) be deemed to have given notice of an election to
refinance such Borrowing with an ABR Borrowing. If the Borrower shall not have
given notice in accordance with this Section of its election to refinance a
Eurocurrency Borrowing prior to the end of the Interest Period in effect for
such
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Borrowing, then the Borrower shall repay such Borrowing at the end of such
Interest Period. The Agent shall promptly advise the Lenders of any notice given
pursuant to this Section and of each Lender's portion of the requested
Borrowing.
SECTION 2.05. Refinancings. The Borrower may refinance all or any part of
------------
any Standby Borrowing or Term Borrowing with a Borrowing of the same or a
different Type made pursuant to Section 2.03 or Section 2.04, subject to the
conditions and limitations set forth herein and elsewhere in this Agreement. Any
Standby Borrowing or Term Borrowing or part thereof so refinanced with a
Borrowing denominated in the same currency shall be deemed to be repaid in
accordance with Section 2.07 with the proceeds of a new Borrowing hereunder and
the proceeds of the new Borrowing, to the extent they do not exceed the
principal amount of the Borrowing being refinanced, shall not be paid by the
Lenders to the Agent or by the Agent to the Borrower pursuant to Section
2.02(c); provided, however, that (i) if the principal amount extended by a
Lender in a refinancing is greater than the principal amount extended by such
Lender in the Borrowing being refinanced, then such Lender shall pay such
difference to the Agent for distribution to the Lenders described in (ii) below,
(ii) if the principal amount extended by a Lender in the Borrowing being
refinanced is greater than the principal amount being extended by such Lender in
the refinancing, the Agent shall return the difference to such Lender out of
amounts received pursuant to (i) above, and (iii) to the extent any Lender fails
to pay the Agent amounts due from it pursuant to (i) above, any Loan or portion
thereof being refinanced shall not be deemed repaid in accordance with Section
2.07 and shall be payable by the Borrower.
SECTION 2.06. Fees. (a) The Borrower agrees to pay to each Lender, through
----
the Agent, on the last Business Day of March, June, September and December of
each year, on the date on which the Revolving Commitment of such Lender shall be
terminated as provided herein and on the Revolving Maturity Date, a facility fee
(a "Facility Fee") based upon the Borrower's Credit Rating in accordance with
the table set forth in the definition of "Applicable Percentage". The Facility
Fee for each Lender shall be equal to the Applicable Percentage per annum in
effect from time to time on the amount of the Revolving Commitment of such
Lender, whether used or unused, in effect from time to time during the preceding
quarter (or shorter period commencing with the date hereof or ending with the
Revolving Maturity Date or any date on which the Revolving Commitment of such
Lender shall be terminated). The Facility Fees shall be computed on the basis of
the actual number of days elapsed in a year of 360 days. The Facility Fee due to
each Lender shall commence to accrue on the date hereof and shall cease to
accrue on the earlier of (i) the termination of the Revolving Commitment of such
Lender and (ii) the Revolving Maturity Date.
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(b) The Borrower shall pay to the Agent, for its own account, agent and
administrative fees (the "Agent and Administrative Fees") at the times and in
the amounts agreed upon in the letter agreement dated as of May 24, 2001,
between the Borrower and the Agent.
(c) The Borrower shall pay (i) to the Agent for the account of each Lender
a fee (the "L/C Fee") with respect to its participations in Letters of Credit,
which shall accrue at the same Applicable Percentage as interest on Eurodollar
Revolving Loans on the average daily amount of such Lender's L/C Exposure
(excluding any portion thereof attributable to unreimbursed L/C Disbursements)
during the period from and including the Effective Date to but excluding the
later of the date on which such Lender's Revolving Commitment terminates and the
date on which such Lender ceases to have any L/C Exposure, and (ii) to the
Issuing Bank a fee (the "L/C Facing Fee"), which shall accrue at the rate of
0.125% per annum on the average daily amount of the L/C Exposure (excluding any
portion thereof attributable to unreimbursed L/C Disbursements) during the
period from and including the Effective Date to but excluding the later of the
date of termination of the Revolving Commitments and the date on which there
ceases to be any L/C Exposure, as well as the Issuing Bank's standard fees with
respect to the issuance, amendment, renewal or extension of any Letter of Credit
or processing of drawings thereunder. L/C Fees and L/C Facing Fees accrued from
and including the Effective Date or the last Business Day of the preceding
March, June, September or December, as applicable, to and excluding the last
Business Day of March, June, September and December of each year shall be
payable on such last Business Day of such quarter, commencing on the first such
date to occur after the Effective Date; provided that all such fees shall be
payable on the date on which the Revolving Commitments terminate and any such
fees accruing after the date on which the Revolving Commitments terminate shall
be payable on demand. Any other fees payable to the Issuing Bank pursuant to
this paragraph shall be payable within thirty (30) days after demand. All
participation fees and fronting fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).
(d) All Fees shall be paid on the dates due, in immediately available
funds, to the Agent for distribution, if and as appropriate, among the Lenders
except that the L/C Facing Fees shall be paid directly to the Issuing Bank. Once
paid, none of the Fees shall be refundable under any circumstances unless such
Fees were paid in error.
SECTION 2.07. Evidence of Indebtedness; Repayment of Loans. (a) The
--------------------------------------------
Borrower hereby unconditionally promises to pay (i) to the Agent for the account
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of each Lender the then unpaid principal amount of each Term Loan of such Lender
as provided in Section 2.12 and otherwise when due in accordance with the terms
of this Agreement and (ii) to the Agent for the account of each Lender the then
unpaid principal amount of each Revolving Loan on the last day of the Interest
Period applicable thereto and otherwise when due in accordance with the terms of
this Agreement. The Borrower further hereby unconditionally promises to pay to
the Agent for the account of each Lender all accrued interest on the Loans when
due in accordance with the terms of this Agreement.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(c) The Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Class and Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Agent hereunder for the account
of the Lenders and each Lenders share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein, absent manifest error; provided
that the failure of any Lender or the Agent to maintain such accounts or any
error therein shall not in any manner affect the obligation of the Borrower to
properly repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Agent.
SECTION 2.08. Interest on Loans. (a) Subject to the provisions of Section
-----------------
2.09, the Loans comprising each Eurocurrency Borrowing and Eurodollar Borrowing
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 360 days, except for Borrowings denominated in Sterling which
shall be computed on the basis of the actual number of days elapsed over a year
of 365 days) at a rate per annum equal to (i) in the case of each Eurocurrency
Loan, Eurodollar Standby Loan or Eurodollar Term Loan, the Adjusted LIBO Rate
for the Interest Period in effect for such Borrowing plus the Applicable
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Percentage, and (ii) in the case of each Eurodollar Competitive Loan, the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Competitive Margin offered by the Lender making such Loan and accepted by the
Borrower pursuant to Section 2.03. Interest on each Eurocurrency Borrowing and
Eurodollar Borrowing shall be payable on each applicable Interest Payment Date.
The Adjusted LIBO Rate and the LIBO Rate for each Interest Period shall be
determined by the Agent in accordance with the definition of Adjusted LIBO Rate
and LIBO Rate, respectively, herein. The Agent shall promptly advise the
Borrower and each Lender, as appropriate, of such determination.
(b) Subject to the provisions of Section 2.09, the Loans comprising each
ABR Borrowing shall bear interest (computed on the basis of the actual number of
days elapsed over a year of 365/366 days if computed based on the Prime Rate and
360 days if computed based on the Federal Funds Effective Rate) at a rate per
annum equal to the Alternate Base Rate plus the Applicable Percentage. Interest
on each ABR Borrowing shall be payable on each applicable Interest Payment Date.
The Alternate Base Rate shall be determined by the Agent in accordance with the
definition of Alternate Base Rate herein.
(c) Subject to the provisions of Section 2.09, each Fixed Rate Loan shall
bear interest at a rate per annum (computed on the basis of the actual number of
days elapsed over a year of 360 days) equal to the fixed rate of interest
offered by the Lender making such Loan and accepted by the Borrower pursuant to
Section 2.03. Interest on each Fixed Rate Loan shall be payable on the Interest
Payment Dates applicable to such Loan except as otherwise provided in this
Agreement.
SECTION 2.09. Default Interest. If the Borrower shall default in the
----------------
payment of the principal of or interest on any Loan or any other amount becoming
due hereunder, whether by scheduled maturity, notice of prepayment, acceleration
or otherwise, the Borrower shall on demand from time to time from the Agent pay
interest, to the extent permitted by law, on such defaulted amount up to (but
not including) the date of actual payment (after as well as before judgment) at
a rate per annum (computed on the basis of the actual number of days elapsed
over a year of 360 days) equal to the Alternate Base Rate plus the Applicable
Percentage for ABR Loans plus 2%, or in the case of any Eurocurrency Loan, 2%
above the rate otherwise in effect.
SECTION 2.10. Alternate Rate of Interest. In the event, and on each
--------------------------
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurocurrency Borrowing or a Eurodollar Borrowing the Agent
shall have determined (i) that deposits in the principal amounts of the Loans
comprising such Borrowing and in the currency in which such Loan is to be
denominated are not generally available in the relevant market, or that the
rates
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at which such deposits are being offered will not adequately and fairly reflect
the cost to any Lender of making or maintaining its Eurocurrency Loan or
Eurodollar Loan, as applicable, during such Interest Period, or that reasonable
means do not exist for ascertaining the LIBO Rate or the Adjusted LIBO Rate, or
(ii) in the case of a Eurocurrency Borrowing, that there shall have occurred any
change in national or international financial, political or economic conditions
(including the imposition of or any change in exchange controls) or currency
exchange rates which would make it impracticable to make Loans denominated in
the applicable Alternative Currency, the Agent shall, as promptly as
practicable, give written telecopy notice of such determination to the Borrower
and the Lenders. In the event of any such determination, until the Agent shall
have advised the Borrower and the Lenders that the circumstances giving rise to
such notice no longer exist, (A) any request by the Borrower for a Eurodollar
Competitive Borrowing pursuant to Section 2.03 shall be of no force and effect
and shall be denied by the Agent, (B) any request by the Borrower for a
Eurodollar Standby Borrowing pursuant to Section 2.04 shall be deemed to be a
request for an ABR Borrowing and (C) any request by the Borrower for a
Eurocurrency Borrowing pursuant to Section 2.04 shall be deemed to be a request
by the Borrower for an ABR Borrowing.
SECTION 2.11. Termination and Reduction of Commitments. (a) Unless
----------------------------------------
previously terminated, (i) the Term Commitments shall terminate at 5:00 p.m.,
New York City time, on the Effective Date, and (ii) the Revolving Commitments
shall terminate on the Revolving Maturity Date.
(b) Upon at least five Business Days' prior irrevocable written or
telecopy notice to the Agent, the Borrower may at any time in whole permanently
terminate, or from time to time in part permanently reduce, the Commitments of
any Class; provided, however, that (i) each partial reduction of the Commitments
of any Class shall be in an integral multiple of $1,000,000 and in a minimum
principal amount of $5,000,000, (ii) no such termination or reduction shall be
made which would reduce (A) the Revolving Commitments to an amount less than the
aggregate outstanding principal amount of the Revolving Loans plus the L/C
Exposure, (B) the Total Revolving Tranche A Commitment to an amount less than
the aggregate Revolving Tranche A Usage or (C) the Total Revolving Tranche B
Commitment to an amount less than the aggregate Revolving Tranche B Usage and
(iii) reductions in the Revolving Commitments shall be allocated two-thirds
(2/3) to the Revolving Tranche A Commitments and one-third (1/3) to the
Revolving Tranche B Commitments. If, following any partial reduction of the
Revolving Commitments, the Revolving Tranche B Commitments (as so reduced) shall
be less than the Eurocurrency Sublimit, the Eurocurrency Sublimit shall be
automatically reduced so as to equal the Total Revolving Tranche B Commitment.
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(c) Each reduction in the Commitments of any Class hereunder shall be made
ratably among the Lenders in accordance with their respective Commitments of
such Class. The Borrower shall pay to the Agent for the accounts of the Lenders,
on the date of each termination or reduction, the Facility Fees on the amount of
the Commitments so terminated or reduced accrued through the date of such
termination or reduction.
SECTION 2.12. Prepayment; Amortization of Term Loans. (a) The Borrower
--------------------------------------
shall have the right at any time and from time to time to prepay any Borrowing,
in whole or in part, upon giving written or telecopy notice (or telephone notice
promptly confirmed by written or telecopy notice) to the Agent before 10:00
a.m., New York City time (or, in the case of any Eurocurrency Borrowing, 10:00
a.m., London time), three Business Days prior to prepayment; provided, however,
that each partial prepayment shall be in an amount which is (or the Equivalent
Dollar Amount of which, determined as of the date which is three Business Days
prior to repayment, is) an integral multiple of $1,000,000 and not less than
$1,000,000. Notwithstanding anything to the contrary in this Agreement, the
Borrower shall not have the right to prepay any Competitive Borrowing without
the consent of the Lender(s) making such Loan.
(b) On the date of any termination or reduction of the Revolving
Commitments pursuant to Section 2.11, the Borrower shall pay or prepay so much
of the Standby Borrowings as shall be necessary in order that (i) the sum of the
Aggregate Standby Exposure plus the aggregate principal amount of the
outstanding Competitive Borrowings shall not exceed the Total Revolving
Commitment, (ii) the aggregate Revolving Tranche A Usage of all Lenders shall
not exceed the Total Revolving Tranche A Commitment, (iii) the aggregate
Revolving Tranche B Usage of all Lenders shall not exceed the Total Revolving
Tranche B Commitment, in each case after giving effect to such termination or
reduction.
(c) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing (or portion
thereof) by the amount stated therein on the date stated therein. All
prepayments under this Section shall be subject to Section 2.15 but otherwise
without premium or penalty and shall be applied ratably to the Loans included in
the prepaid Borrowing. All prepayments under this Section shall be accompanied
by accrued interest on the principal amount being prepaid to the date of
payment.
(d) Subject to adjustment pursuant to paragraph (f) of this Section, the
Borrower shall repay Term Borrowings on each date set forth below in the
aggregate principal amount set forth opposite such date:
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Date Amount
---- ------
1. October 1, 2001 $3,750,000
2. January 1, 2002 $3,750,000
3. April 1, 2002 $3,750,000
4. July 1, 2002 $5,000,000
5. October 1, 2002 $5,000,000
6. January 1, 2003 $5,000,000
7. April 1, 2003 $5,000,000
8. July 1, 2003 $6,250,000
9. October 1, 2003 $6,250,000
10. January 1, 2004 $6,250,000
11. April 1, 2004 $6,250,000
12. July 1, 2004 $7,500,000
13. October 1, 2004 $7,500,000
14. January 1, 2005 $7,500,000
15. April 1, 2005 $7,500,000
16. July 1, 2005 $9,687,500
17. October 1, 2005 $9,687,500
18. January 1, 2006 $9,687,500
19. April 1, 2006 $9,687,500
(e) To the extent not previously paid, all Term Loans shall be due and
payable on the Term Maturity Date.
(f) Any unscheduled prepayment of a Term Borrowing shall be applied to
reduce the subsequent scheduled repayments of the Term Borrowings to be made
pursuant to paragraph (d) ratably.
SECTION 2.13. Reserve Requirements; Change in Circumstances. (a)
---------------------------------------------
Notwithstanding any other provision herein, if after the date of this Agreement
any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender or Issuing
Bank of the principal of or interest on any Eurocurrency Loan, Eurodollar Loan
or Fixed Rate Loan made by such Lender or any Fees or other amounts payable
hereunder (other than changes in respect of taxes imposed on the overall net
income of such Lender or Issuing Bank by any jurisdiction or any political
subdivision thereof) or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by such Lender or such Issuing Bank (except
any such reserve requirement which is already reflected in the definition of the
applicable Rate), or
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shall impose on such Lender or such Issuing Bank or the London interbank market
any other condition affecting this Agreement or any Eurocurrency Loan,
Eurodollar Loan or Fixed Rate Loan made by such Lender or any Letter of Credit
or participation therein, and the result of any of the foregoing shall be to
increase the cost to such Lender or Issuing Bank of making or maintaining any
Eurocurrency Loan, Eurodollar Loan or Fixed Rate Loan or increase the cost to
any Lender of issuing or maintaining any Letter of Credit or purchasing or
maintaining a participation therein or to reduce the amount of any sum received
or receivable by such Lender or such Issuing Bank hereunder (whether of
principal, interest or otherwise) by an amount reasonably deemed by such Lender
or such Issuing Bank to be material, then the Borrower shall pay to such Lender
or such Issuing Bank, as the case may be, within thirty (30) days of its receipt
of written demand therefor such additional amount or amounts as will compensate
such Lender or such Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered. Notwithstanding the foregoing, no Lender shall
be entitled to request compensation under this paragraph with respect to any
Competitive Loan if it should have been aware of the change giving rise to such
request at the time of submission of the Competitive Bid pursuant to which such
Competitive Loan shall have been made.
(b) If any Lender or Issuing Bank shall have reasonably determined that
the adoption after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any Governmental
Authority charged with the interpretation or administration thereof, or
compliance by any Lender (or any lending office of such Lender) or any Issuing
Bank or any Lender's or Issuing Bank's holding company with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, has or would have the effect of reducing the
rate of return on such Lender's or Issuing Bank's capital or on the capital of
such Lender's or Issuing Bank's holding company, if any, as a consequence of
this Agreement or the Loans made or participations in Letters of Credit
purchased by such Lender pursuant hereto or the Letters of Credit issued by such
Issuing Bank pursuant hereto to a level below that which such Lender or Issuing
Bank or such Lender's or Issuing Bank's holding company could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or Issuing Bank's policies and the policies of such Lender's or Issuing Bank's
holding company with respect to capital adequacy) by an amount deemed by such
Lender or Issuing Bank to be material, then from time to time the Borrower shall
pay to such Lender or Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or Issuing Bank or such Lender's or
Issuing Bank's holding company for any such reduction suffered.
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(c) A certificate of a Lender or Issuing Bank setting forth in reasonable
detail the calculation for such amount or amounts as shall be necessary to
compensate such Lender or Issuing Bank, as applicable, as specified in paragraph
(a) or (b) above, as the case may be, shall be delivered to the Borrower. The
Borrower shall pay each Lender or Issuing Bank the amount shown as due (absent
manifest error) on any such certificate delivered by it within thirty (30) days
after the receipt of the same.
(d) Failure on the part of any Lender or the Issuing Bank to demand
compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of such Lender's or Issuing Bank's right to demand
compensation with respect to such period or any other period.
(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section shall survive
the payment in full of the principal of and interest on all Loans made
hereunder.
SECTION 2.14. Change in Legality. (a) Notwithstanding any other provision
------------------
herein, if any change in any law or regulation or in the interpretation thereof
by any Governmental Authority charged with the administration or interpretation
thereof shall make it unlawful for any Lender to make or maintain any
Eurocurrency Loan or Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurocurrency Loan or Eurodollar Loan,
then, by written notice to the Borrower and to the Agent, such Lender may:
(i) declare that Eurocurrency Loans or Eurodollar Loans, as the
case may be, shall not thereafter be made by such Lender hereunder,
whereupon such Lender shall not submit a Competitive Bid in response
to a request for Eurodollar Competitive Loans and any request by the
Borrower for a Eurocurrency Loan or Eurodollar Standby Borrowing, as
the case may be, shall, as to such Lender only, be deemed a request
for an ABR Loan to the Borrower unless such declaration shall be
subsequently withdrawn; and
(ii) require that all outstanding Eurocurrency Loans or
Eurodollar Loans, as the case may be, made by it be converted to ABR
Loans, in which event all such Eurocurrency Loans or Eurodollar Loans,
as the case may be, shall be automatically converted to ABR Loans as
of the effective date of such notice as provided in paragraph (b)
below (such conversion to be made, in the case of a Eurocurrency Loan,
into dollars at the applicable Spot Exchange Rate).
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In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal which would otherwise have been applied to
repay the Eurocurrency Loans or Eurodollar Loans, as the case may be, that would
have been made by such Lender or the converted Eurocurrency Loans or Eurodollar
Loans of such Lender shall instead be applied to repay the ABR Loans made by
such Lender in lieu of, or resulting from the conversion of, such Eurocurrency
Loans or Eurodollar Loans.
(b) For purposes of this Section, a notice to the Borrower by any Lender
shall be effective as to each Eurocurrency Loan or Eurodollar Loan, as the case
may be, if lawful, on the last day of the Interest Period then applicable to
such Eurocurrency Loan or Eurodollar Loan; in all other cases such notice shall
be effective on the date of receipt by the Borrower.
(c) After a Lender gives notice under Section 2.14(a), such Lender shall
take reasonable steps consistent with its customary practice to monitor its
ability to resume the lawful making of Eurocurrency Loans or Eurodollar Loans,
as the case may be. If such Lender determines that it may lawfully make
Eurocurrency Loans or Eurodollar Loans, as the case may be, such Lender shall
promptly give notice of that determination, in writing, to the Borrower and the
Agent, and the Agent shall promptly transmit the notice to each other Lender.
The Borrower's right to request, and such Lender's obligation, if any, to make
Eurocurrency Loans or Eurodollar Loans, as the case may be, to the Borrower
shall thereupon be restored.
SECTION 2.15. Indemnity. The Borrower shall indemnify each Lender against
---------
any loss (other than lost profits) or expense which such Lender incurs as a
consequence of (a) any failure by the Borrower to fulfill on the date of any
borrowing hereunder the applicable conditions set forth in Article IV, (b) any
failure by the Borrower to borrow or to refinance any Loan hereunder after
irrevocable notice of such borrowing or refinancing has been given pursuant to
Section 2.03 or 2.04, (c) any payment, prepayment, assignment pursuant to
Section 2.12(c), any repayment or reallocation of a Eurocurrency Loan or
Eurodollar Loan pursuant to Section 2.22, any conversion of a Eurocurrency Loan
or Eurodollar Loan pursuant to Section 2.14(a) or conversion of a Eurocurrency
Loan, Eurodollar Loan or Fixed Rate Loan required by any other provision of this
Agreement or otherwise made or deemed made on a date other than the last day of
the Interest Period applicable thereto, (d) any default in payment or prepayment
of the principal amount of any Loan or any part thereof or interest accrued
thereon, as and when due and payable at the due date thereof (whether by
scheduled maturity, acceleration, irrevocable notice of prepayment or otherwise)
or (e) the occurrence of any Event of Default, including, in each such
-44-
case, any loss or reasonable expense incurred or to be incurred in liquidating
or employing deposits from third parties acquired to effect or maintain such
Loan or any part thereof as a Eurocurrency Loan, Eurodollar Loan or Fixed Rate
Loan. Such loss or reasonable expense shall include an amount equal to the
excess, if any, as reasonably determined by such Lender, of (i) its cost of
obtaining the funds for the Loan being paid, prepaid, assigned, converted or not
borrowed (based on the Adjusted LIBO Rate or, in the case of a Fixed Rate Loan,
the fixed rate of interest applicable thereto) for the period from the date of
such payment, prepayment, assignment, conversion or failure to borrow to the
last day of the Interest Period for such Loan (or, in the case of a failure to
borrow, the Interest Period for such Loan which would have commenced on the date
of such failure) over (ii) the amount of interest (as reasonably determined by
such Lender) that would be realized by such Lender in reemploying the funds so
paid, prepaid, assigned, converted or not borrowed for such period or Interest
Period, as the case may be. A certificate of any Lender setting forth in
reasonable detail the calculation for any amount or amounts which such Lender is
entitled to receive (absent manifest error) pursuant to this Section and
evidencing a loss suffered by such Lender of such amount or amounts shall be
delivered to the Borrower.
SECTION 2.16. Pro Rata Treatment. Except as required under Section 2.14,
------------------
each Term Borrowing, each Standby Borrowing, each payment or prepayment of
principal of any Term Borrowing or Standby Borrowing, each payment of interest
on the Term Loans or Standby Loans, each payment of the Facility Fees and L/C
Fees, each reduction of the Commitments and each refinancing of any Borrowing of
any Class, shall be allocated pro rata among the Lenders in accordance with
their respective Commitments of the applicable Class (or, if such Commitments
shall have expired or been terminated, in accordance with the respective
principal amounts of their outstanding Standby Loans or Term Loans, as the case
may be). Each payment of principal of any Competitive Borrowing shall be
allocated pro rata among the Lenders participating in such Borrowing in
accordance with the respective principal amounts of their outstanding
Competitive Loans comprising such Borrowing. Each payment of interest on any
Competitive Borrowing shall be allocated pro rata among the Lenders
participating in such Borrowing in accordance with the respective amounts of
accrued and unpaid interest on their outstanding Competitive Loans comprising
such Borrowing. For purposes of determining the available Commitments of the
Lenders at any time, each outstanding Competitive Borrowing shall be deemed to
have utilized the Revolving Commitments of the Lenders, first from the Revolving
Tranche A Commitments and then from the Revolving Tranche B Commitments
(including those Lenders which shall not have made Loans as part of such
Competitive Borrowing) pro rata in accordance with such respective Commitments.
Each Lender agrees that in computing such
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Lender's portion of any Borrowing to be made hereunder, the Agent may, in its
discretion, round each Lender's percentage of such Borrowing to the next higher
or lower whole dollar amount.
SECTION 2.17. Sharing of Setoffs. Each Lender agrees that if it shall,
------------------
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower, or pursuant to a secured claim under Section 506 of Title 11 of
the United States Code or other security or interest arising from, or in lieu
of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means (other than
an assignment pursuant to Section 2.13(c) or 9.04), obtain payment (voluntary or
involuntary) in respect of any Term Loan, Standby Loan or L/C Disbursement as a
result of which the unpaid principal portion of its Term Loans, Standby Loans
and participations in L/C Disbursements shall be proportionately less than the
unpaid principal portion of the Term Loans, Standby Loans and participations in
L/C Disbursements of any other Lender, it shall be deemed simultaneously to have
purchased from such other Lender at face value, and shall promptly pay to such
other Lender the purchase price for, a participation in the Term Loans, Standby
Loans and L/C Exposure of such other Lender, so that the aggregate unpaid
principal amount of the Term Loans, Standby Loans and L/C Exposure and
participations in the Term Loans, Standby Loans and L/C Exposure held by each
Lender shall be in the same proportion to the aggregate unpaid principal amount
of all Term Loans, Standby Loans and L/C Exposure then outstanding as the
principal amount of its Term Loans, Standby Loans and L/C Exposure prior to such
exercise of banker's lien, setoff or counterclaim or other event was to the
principal amount of all Term Loans, Standby Loans or L/C Exposure, as the case
may be, outstanding prior to such exercise of banker's lien, setoff or
counterclaim or other event; provided, however, that, if any such purchase or
purchases or adjustments shall be made pursuant to this Section and the payment
giving rise thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustment restored without interest. The Borrower expressly
consents to the foregoing arrangements and agrees that any Lender holding a
participation in a Term Loan, Standby Loan or L/C Disbursement deemed to have
been so purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made a Term Loan or
Standby Loan directly to the Borrower in the amount of such participation.
SECTION 2.18. Payments. (a) The Borrower shall make each payment
--------
(including principal of or interest on the Loans or any L/C Disbursement or any
Fees or other amounts) hereunder and under any other Loan Document to such
-46-
account of the Agent as the Agent shall have specified, not later than 3:00
p.m., New York time, on the date when due, in the currency in which such Loan
was made and in federal funds or such other immediately available funds as may
then be customary for the settlement of international transactions in the
relevant currency at such place, without setoff or counterclaim.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may (except as otherwise provided in the definition
of "Interest Period") be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of interest
or Fees, if applicable.
SECTION 2.19. Taxes. (a) Any and all payments by the Borrower hereunder
-----
shall be made, in accordance with Section 2.18, free and clear of and without
deduction for any and all present or future taxes, imposts, deductions, charges
or withholdings, and all liabilities with respect thereto, excluding taxes
imposed on the Agent's or any Lender's or any Issuing Bank's (or any
transferee's or assignee's, including a participation holder's (any such entity
a "Transferee")) net income and franchise taxes imposed on the Agent or any
Lender or any Issuing Bank (or Transferee) by any jurisdiction or any political
subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities 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 to the Lenders or any Issuing Bank (or any
Transferee) or the Agent, (i) the sum payable shall be increased by the amount
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section) such Lender or such
Issuing Bank (or Transferee) or the Agent (as the case may be) shall receive 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 taxing authority or other Governmental
Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
other Loan Document (hereinafter referred to as "Other Taxes").
(c) The Borrower shall indemnify each Lender and Issuing Bank (or
Transferee) and the Agent for the full amount of Taxes and Other Taxes
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(including any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section) paid by such Lender or such Issuing Bank (or
Transferee) or the Agent, as the case may be, and any liability (including
penalties, interest and reasonable out-of-pocket expenses) arising therefrom or
with respect thereto (other than penalties, interest and expenses payable solely
because of the negligence of such Lender or Issuing Bank), whether or not such
Taxes or Other Taxes were correctly or legally asserted by the relevant taxing
authority or other Governmental Authority. Such indemnification shall be made
within 30 days after the date any Lender or Issuing Bank (or Transferee) or the
Agent, as the case may be, makes written demand therefor, which demand may be
made after such Lender, Issuing Bank (or Transferee) or the Agent, in its sole
discretion (reasonably exercised) and at the sole expense of the Borrower,
determines to challenge or contest such assertion of Taxes or Other Taxes.
After the Borrower makes full payment to the Lender, Issuing Bank (or
Transferee) or the Agent with respect to such indemnification for Taxes or Other
Taxes asserted, if such Lender, Issuing Bank (or Transferee) or the Agent
believes in its sole discretion that reasonable grounds exist to challenge or
contest the Taxes or Other Taxes imposed, then such Lender, Issuing Bank (or
Transferee) or the Agent, as the case may be, shall so contest or challenge in
good faith the Taxes or Other Taxes asserted, which contest or challenge shall
be at the sole expense of the Borrower. If a Lender, Issuing Bank (or
Transferee) or the Agent shall become aware that it is entitled to receive a
refund in respect of Taxes or Other Taxes, 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, apply for such refund at the Borrower's reasonable out-
of-pocket expense. If any Lender, Issuing Bank (or Transferee) or the Agent
receives a refund in respect of any Taxes or Other Taxes for which such Lender,
Issuing Bank (or Transferee) or the Agent has received payment from the Borrower
hereunder it shall promptly notify the Borrower of such refund and shall
promptly upon receipt repay such refund to the Borrower, net of all out-of-
pocket expenses of such Lender, the Agent or the Issuing Bank and without
interest (other than any interest paid by the applicable taxing authority);
provided, however, that the Borrower, upon the request of such Lender, Issuing
Bank (or Transferee) or the Agent, agrees to return such refund (plus penalties,
interest or other charges) to such Lender, Issuing Bank (or Transferee) or the
Agent in the event such Lender, Issuing Bank (or Transferee) or the Agent is
required to repay such refund.
(d) Within 30 days after the date of any payment of Taxes or Other Taxes
withheld by the Borrower in respect of any payment to any Lender, Issuing Bank
(or Transferee) or the Agent, the Borrower will furnish to the Agent, at its
address referred to in Section 9.01, the original or a certified copy of a
receipt evidencing payment thereof.
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(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section shall survive
the payment in full of the principal of and interest on all Loans made
hereunder.
(f) On or before the date it becomes a party to this Agreement and from
time to time thereafter upon any change in status rendering any certificate or
documents previously delivered pursuant to this Section 2.19(f) invalid or
inaccurate, each Lender, Issuing Bank or Transferee that is organized outside
the United States shall (but (x) in the case of a Transferee or (y) in the case
of a Lender or Issuing Bank with respect to any change in status, only if
legally able to do so) upon written request of the Borrower, deliver to the
Borrower such certificates, documents or other evidence, as specified by the
Borrower and, as the case may be, required by, in the case of a non-United
States Lender or Issuing Bank, the Code or Treasury Regulations issued pursuant
thereto, properly completed and duly executed by such Lender (or Transferee)
establishing that such payment is, as the case may be, (i) not subject to
withholding under the Code because such payment is effectively connected with
the conduct by such Lender, Issuing Bank or Transferee of a trade or business in
the United States or (ii) totally exempt from United States tax under a
provision of an applicable tax treaty. Unless the Borrower and the Agent have
received forms or other documents satisfactory to them indicating that payments
hereunder are not subject to United States withholding tax, as the case may be,
or are subject to such tax at a rate reduced by an applicable tax treaty, the
Borrower or the Agent shall withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Lender, Issuing Bank or
Transferee or assignee organized under the laws of a jurisdiction outside the
United States or Germany, as the case may be.
(g) The Borrower shall not be required to pay any additional amounts to
any Lender, Issuing Bank or Transferee in respect of United States withholding
tax pursuant to Section 2.19(a) if the obligation to pay such additional amounts
would not have arisen but for a failure by such Lender, Issuing Bank or
Transferee to comply with the provisions of Section 2.19(f) unless such failure
results from (i) a change in applicable law, regulation or official
interpretation thereof or (ii) an amendment, modification or revocation of any
applicable tax treaty or a change in official position regarding the application
or interpretation thereof, in each case after the Effective Date (and, in the
case of a Transferee, after the date of assignment or transfer, unless as a
result of such change, amendment, modification or revocation withholding taxes
were or would have been imposed on amounts payable to the transferor); provided,
however, that the Borrower shall be required to pay those amounts to any Lender,
Issuing Bank or Transferee that it was required to pay hereunder prior to the
failure of such
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Lender, Issuing Bank or Transferee to comply with the provisions of Section
2.19(f).
(h) Any Lender, Issuing Bank or Transferee claiming any additional amounts
payable pursuant to this Section shall use reasonable efforts (consistent with
legal and regulatory restrictions) to file any certificate or document in a
timely manner requested by the Borrower or to change the jurisdiction of its
applicable lending office if the making of such a filing or change would avoid
the need for or reduce the amount of any such additional amounts which may
thereafter accrue and would not, in the sole and reasonable determination of
such Lender, Issuing Bank or Transferee be otherwise disadvantageous to such
Lender, Issuing Bank or Transferee.
SECTION 2.20. Letters of Credit. (a) General. The Borrower may request the
----------------- -------
issuance of a Letter of Credit for its own account, in a form reasonably
acceptable to the Agent and the Issuing Bank, at any time and from time to time
while the Revolving Commitments remain in effect. Each Letter of Credit shall be
denominated in dollars or in an Alternative Currency. This Section shall not be
construed to impose obligation upon the Issuing Bank to issue any Letter of
Credit that is inconsistent with the terms and conditions of this Agreement.
Notwithstanding any other provision of this Agreement to the contrary, (a) each
Letter of Credit denominated in dollars shall be a Tranche A Letter of Credit
and shall be deemed to use the Revolving Tranche A Commitments unless the
Revolving Tranche A Commitments have been fully used and are not available at
such time for the issuance of such Letter of Credit, in which case such Letter
of Credit denominated in dollars shall be a Tranche B Letter of Credit and shall
be deemed to use the Revolving Tranche B Commitments, if available, and (b) each
Letter of Credit denominated in an Alternative Currency shall be a Tranche B
Letter of Credit and shall be deemed to use the Revolving Tranche B Commitments,
if such Revolving Tranche B Commitments are available. The letters of credit
issued by the Issuing Bank under the Existing Credit Agreement and described on
Schedule 2.20(a) shall for all purposes be Letters of Credit hereunder.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
---------------------------------------------------------------------
In order to request the issuance of a Letter of Credit (or to amend, renew or
extend an existing Letter of Credit), the Borrower shall hand deliver or
telecopy to the Issuing Bank and the Agent (reasonably in advance of the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, the date of issuance, amendment, renewal or
extension, the date on which such Letter of Credit is to expire (which shall
comply
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with paragraph (c) below), whether such Letter of Credit is to be denominated in
dollars or an Alternative Currency, whether such Letter of Credit is to be a
Tranche A Letter of Credit or a Tranche B Letter of Credit, the amount of such
Letter of Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare such Letter of Credit. Following
receipt of such notice and prior to the issuance of the requested Letter of
Credit or the applicable amendment, renewal or extension, the Agent shall notify
the Borrower and the Issuing Bank of the amount of the Aggregate Standby
Exposure, the aggregate Standby Tranche A Exposures, the aggregate Standby
Tranche B Exposures and the aggregate principal amount of the outstanding
Competitive Borrowings after giving effect to (i) the issuance, amendment,
renewal or extension of such Letter of Credit, (ii) the issuance or expiration
of any other Letter of Credit that is to be issued or will expire prior to the
requested date of issuance of such Letter of Credit and (iii) the borrowing or
repayment of any Standby Loans or Competitive Loans that (based upon notices
delivered to the Agent by the Borrower) are to be borrowed or repaid prior to
the requested date of issuance of such Letter of Credit. A Letter of Credit
shall be issued, amended, renewed or extended only if, and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that, after giving effect to such issuance,
amendment, renewal or extension (A) the L/C Exposure shall not exceed the lesser
of 20% of the Total Revolving Commitment and $30,000,000, (B) the sum of the
Aggregate Standby Exposure and the aggregate principal amount of outstanding
Competitive Borrowings shall not exceed the Total Revolving Commitment, (C) the
sum of (X) the aggregate Equivalent Dollar Amount of all outstanding
Eurocurrency Loans plus (Y) the aggregate undrawn Equivalent Dollar Amount of
all outstanding Alternative Currency Letters of Credit shall not exceed the
Eurocurrency Sublimit and (D) the aggregate Revolving Tranche A Usage of all
Lenders shall not exceed the Total Revolving Tranche A Commitment, and (E) the
aggregate Revolving Tranche B Usage of all Lenders shall not exceed the Total
Revolving Tranche B Commitment. The Agent shall notify the Lenders of any
issuance of a Letter of Credit.
(c) Expiration Date. Each Letter of Credit shall expire at the close of
---------------
business on the earlier of the date one year after the date of the issuance of
such Letter of Credit and the date that is 30 days prior to the Revolving
Maturity Date, unless such Letter of Credit expires by its terms on an earlier
date.
(d) Participations. By the issuance of a Letter of Credit and without any
--------------
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Lender, and each such Lender hereby acquires from the
Issuing Bank, a participation in such Letter of Credit equal to such Lender's
Pro
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Rata Percentage (in accordance with its respective Revolving Commitment of the
applicable Class of such Letter of Credit, if any) of the aggregate amount
available to be drawn under such Letter of Credit, effective upon the issuance
of such Letter of Credit. In consideration and in furtherance of the foregoing,
each Lender hereby absolutely and unconditionally agrees to pay to the Agent,
for the account of the Issuing Bank, such Lender's Pro Rata Percentage (in
accordance with its respective Revolving Commitment of the applicable Class of
such Letter of Credit, if any) of the Equivalent Dollar Amount of each L/C
Disbursement made by such Issuing Bank and not reimbursed by the Borrower
forthwith on the date due as provided in Section 2.02(e). Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including the
occurrence and continuance of a Default or an Event of Default or the
termination of the Revolving Commitments, and that each such payment shall be
made without any offset, abatement, withholding or reduction whatsoever.
Notwithstanding anything to the contrary set forth herein, the aggregate amount
to be paid by any Lender with respect to any drawing under a Letter of Credit of
any Class (whether as a payment pursuant to this Section 2.20(d) or a Loan
pursuant to Section 2.02(e)) shall not exceed its Pro Rata Percentage of such
drawing.
(e) Reimbursement. If an Issuing Bank shall make any L/C Disbursement in
-------------
respect of a Letter of Credit, the Borrower shall pay to the Agent an amount
equal to such L/C Disbursement not later than two hours after the Borrower shall
have received notice from such Issuing Bank that payment of such draft will be
made, or, if the Borrower shall have received such notice later than 10:00 a.m.,
New York City time, on any Business Day, not later than 10:00 a.m., New York
City time, on the immediately following Business Day. Notwithstanding anything
contained herein to the contrary, however, in the case of any Alternative
Currency Letter of Credit, the Borrower shall reimburse any drawing thereunder
in the Alternative Currency in which such Alternative Currency Letter of Credit
is denominated; provided however, that if (x) any such drawing is made at a time
when there exists an Event of Default or (y) the Borrower shall not have
notified the Agent and the Issuing Bank prior to 11 a.m. (New York time) at
least two (2) Business Days immediately prior to such drawing that the Borrower
intends to reimburse the Issuing Bank in the applicable Alternative Currency,
then, in either such case, such reimbursement shall instead be made by payment
in dollars of the Equivalent Dollar Amount of such drawing and in immediately
available funds.
(f) Obligations Absolute. The Borrower's obligations to reimburse L/C
--------------------
Disbursements as provided in paragraph (e) above shall be absolute,
-52-
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement, under any and all circumstances whatsoever,
and irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of any Letter of Credit or this
Agreement;
(iii) the existence of any claim, setoff, defense or other right
that the Borrower, any other party guaranteeing, or otherwise
obligated with, the Borrower, any Subsidiary or other Affiliate
thereof or any other person may at any time have against the
beneficiary under any Letter of Credit, any Issuing Bank, the Agent or
any Lender or any other person, whether in connection with this
Agreement or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(v) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of
any Issuing Bank, the Lenders, the Agent or any other person or any
other event or circumstance whatsoever, whether or not similar to any
of the foregoing, that might, but for the provisions of this Section,
constitute a legal or equitable discharge of the Borrower's
obligations hereunder.
Without limiting the generality of the foregoing, it is expressly
understood and agreed that the absolute and unconditional obligation of the
Borrower hereunder to reimburse L/C Disbursements will not be excused by the
negligence or misconduct of any Issuing Bank. However, the foregoing shall not
be construed to excuse any Issuing Bank from liability to the Borrower to the
extent of any actual damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law)
-53-
suffered by the Borrower that are caused by such Issuing Bank's negligence or
misconduct in determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof; it is understood that each
Issuing Bank may accept documents that appear on their face to be in order,
without responsibility for further investigation, regardless of any notice or
information to the contrary and, in making any payment under any Letter of
Credit (i) an Issuing Bank's exclusive reliance on the documents presented to it
under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary thereunder equals the
amount of such draft and whether or not any document presented pursuant to such
Letter of Credit proves to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any other statement or any
other document presented pursuant to such Letter of Credit proves to be forged
or invalid or any statement therein proves to be inaccurate or untrue in any
respect whatsoever and (ii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in
each case, be deemed not to constitute misconduct or negligence of an Issuing
Bank.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following
-----------------------
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. Such Issuing Bank shall as promptly as
possible give telephonic notification, confirmed by telecopy, to the Agent and
the Borrower of such demand for payment and whether such Issuing Bank has made
or will make an L/C Disbursement thereunder; provided that any failure to give
or delay in giving such notice shall not relieve the Borrower of its obligation
to reimburse the Issuing Bank and the Lenders with respect to any such L/C
Disbursement. The Agent shall promptly give each Lender notice thereof.
(h) Resignation or Removal of an Issuing Bank. An Issuing Bank may resign
-----------------------------------------
at any time by giving 180 days prior written notice to the Agent, the Lenders
and the Borrower, and may be removed at any time by the Borrower by notice to
the Issuing Bank, the Agent and the Lenders. Subject to the next succeeding
paragraph, upon the acceptance of any appointment as an Issuing Bank hereunder
by a Lender that shall agree to serve as successor Issuing Bank, such successor
shall succeed to and become vested with all the interests, rights and
obligations of the retiring Issuing Bank and the retiring Issuing Bank shall be
discharged from its obligations to issue additional Letters of Credit hereunder.
At the time such removal or resignation shall become effective, the Borrower
shall pay all accrued and unpaid fees pursuant to Section 2.06(c)(ii). The
acceptance of
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any appointment as an Issuing Bank hereunder by a successor Lender shall be
evidenced by an agreement entered into by such successor, in a form satisfactory
to the Borrower and the Agent, and, from and after the effective date of such
agreement, (i) such successor Lender shall have all the rights and obligations
of the previous Issuing Bank under this Agreement and (ii) references herein to
the term "Issuing Bank" shall be deemed to refer to such successor or to any
previous Issuing Bank, or to such successor and all previous Issuing Banks, as
the context shall require. After the resignation or removal of an Issuing Bank
hereunder, the retiring Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this
Agreement with respect to Letters of Credit issued by it prior to such
resignation or removal, but shall not be required to issue additional Letters of
Credit.
(i) Cash Collateralization. If any Event of Default (other than an Event
----------------------
of Default described in clause (g) or (h) of Article VII) shall occur and be
continuing, the Borrower shall, on the Business Day it receives notice from the
Agent or the Required Lenders (or, if the maturity of the Loans has been
accelerated, Lenders holding participations in outstanding Letters of Credit
representing greater than 50% of the aggregate undrawn amount of all outstanding
Letters of Credit) thereof and of the amount to be deposited, or, if an Event of
Default described in clause (g) or (h) of Article VII shall occur, on the
Business Day of such occurrence, deposit in an account with the Agent, for the
benefit of the Lenders, an amount in cash equal to the L/C Exposure as of such
date. Such deposit shall be held by the Agent as collateral for the payment and
performance of the obligations of the Borrower under this Agreement. The Agent
shall have exclusive dominion and control, including the exclusive right of
withdrawal, over such account. Other than any interest earned on the investment
of such deposits in Permitted Liquid Investments, which investments shall be
made at the option and sole discretion of the Agent, such deposits shall not
bear interest. Interest or profits, if any, on such investments shall accumulate
in such account. Moneys in such account shall (i) automatically be applied by
the Agent to reimburse the Issuing Bank for L/C Disbursements for which they
have not been reimbursed, (ii) be held for the satisfaction of the reimbursement
obligations of the Borrower for the L/C Exposure at such time and (iii) if the
maturity of the Loans has been accelerated (but subject to the consent of
Lenders holding participations in outstanding Letters of Credit representing
greater than 50% of the aggregate undrawn amount of all outstanding Letters of
Credit), be applied to satisfy other obligations of the Borrower under this
Agreement. If the Borrower is required to provide an amount of cash collateral
hereunder as a result of the occurrence of an Event of Default, such amount (to
the extent not applied as aforesaid) shall be returned to the Borrower within
three Business Days after all Events of Default have been cured or waived.
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SECTION 2.21. Currency Fluctuations, etc. (a) Not later than 1:00 p.m.,
--------------------------
New York City time, two days before each Calculation Date, the Agent shall (i)
determine the Spot Exchange Rate as of such Calculation Date with respect to
each Eurocurrency Borrowing and each undrawn Alternative Currency Letter of
Credit and (ii) give notice thereof to the Lenders and the Borrower. The Spot
Exchange Rates so determined shall become effective on the relevant Calculation
Date (a "Reset Date") and shall remain effective until the next succeeding Reset
Date.
(b) Not later than 5:00 p.m., New York City time, on each Reset Date, the
Agent shall (i) determine the Equivalent Dollar Amount of the Eurocurrency Loans
then outstanding (after giving effect to any Eurocurrency Loans to be made or
repaid on such date) and the undrawn Equivalent Dollar Amount of each
outstanding Alternative Currency Letter of Credit (ii) notify the Lenders and
the Borrower of the results of such determination.
(c) If on any Reset Date with respect to Eurocurrency Loans and
Alternative Currency Letters of Credit outstanding the sum of (A) the aggregate
Equivalent Dollar Amount of all outstanding Eurocurrency Loans plus (B) the
aggregate undrawn Equivalent Dollar Amount of all outstanding Alternative
Currency Letters of Credit exceeds the Eurocurrency Sublimit, the Borrower shall
within two (2) Business Days of such date (i) prepay Eurocurrency Loans in an
aggregate amount such that, after giving effect thereto, the sum of (A) the
aggregate Equivalent Dollar Amount of all such Eurocurrency Loans plus (B) the
aggregate undrawn Equivalent Dollar Amount of all outstanding Alternative
Currency Letters of Credit shall be equal to or less than the Eurocurrency
Sublimit, or (ii) if no Eurocurrency Loans are then outstanding, provide cash
collateral for outstanding Alternative Currency Letters of Credit in the amount
of such excess.
SECTION 2.22. Increase in Commitment. (a) After the Closing Date, the
----------------------
Borrower shall have the right on up to three (3) occasions to request that the
Agent obtain additional Commitments (the "Additional Commitments") so that the
Revolving Commitments aggregate an amount equal to One Hundred and Seventy-Five
Million Dollars ($175,000,000) and the Commitments aggregate an amount equal to
Three Hundred and Twenty-Five Million Dollars ($325,000,000) (the "Increased
Facility Amount"), each which request shall be made by the Borrower giving
written notice (the "Additional Commitment Notice") to the Agent prior to the
date which is one hundred and twenty (120) days after the date of this Agreement
setting forth such details with respect thereto as are reasonably requested by
the Agent. Upon such request, the Agent shall, at the Borrower's sole cost and
expense of documentation and legal fees in connection therewith, use
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its reasonable efforts, in accordance with its customary syndication procedures,
with the assistance of the Borrower, to arrange a syndicate of lenders with
Revolving Commitments (including the initial Revolving Commitments), aggregating
the Increased Facility Amount on or before the date which is ninety (90) days
after the Additional Commitment Notice was received by the Agent (the
"Syndication Expiration Date"). The Agent shall first offer to the existing
Lenders the option to participate in the proposed Additional Commitments to the
extent of each Lender's pro-rata share of the proposed Additional Commitments
prior to proposing additional bank syndicate members. If any existing Lender
shall not agree to provide its pro-rata share of the proposed Additional
Commitments within 10 days after receipt from the Agent of a request to accept
such pro-rata share of the proposed Additional Commitments, prior to commencing
syndication, the Agent shall submit a list of proposed bank syndicate members
(who indicate a willingness to accept all or a portion of the amount of the
proposed Additional Commitments) to the Borrower; provided that, notwithstanding
any existing Lender's rejection of its pro-rata share of the proposed Additional
Commitments, such existing Lender shall remain a Lender hereunder, subject to
the terms and conditions hereof. From and after the Syndication Expiration Date,
the Agent shall have no further obligation to syndicate the facility or to
obtain or accept any additional Commitments. Notwithstanding the foregoing,
during the period after the giving of the Additional Commitment Notice and prior
to the Syndication Expiration Date, the Lender which is the Agent shall have the
right, at its option, to commit to make the Additional Commitments available to
the Borrower and, if the Lender which is the Agent shall so elect to commit to
making the Additional Commitments available to the Borrower, to arrange a
syndicate of Lenders with Commitments aggregating the Increased Facility Amount.
In the event that lenders commit to any such increase, any new lender shall
execute an accession agreement to this Agreement, the Revolving Commitments of
the existing Lenders which have committed to provide any of the Additional
Commitments shall be increased, the pro-rata shares of the Lenders shall be
adjusted, the Borrower shall make such borrowings and repayments as shall be
necessary to effect the reallocation of the Commitments, and other changes shall
be made to the Loan Documents as may be necessary to reflect the aggregate
amount, if any, by which Lenders have agreed to increase their respective
Revolving Commitments or make new Revolving Commitments in response to the
Borrower's request for an increase in the aggregate Commitments pursuant to this
Section 2.22 and which other changes do not adversely affect the rights of those
Lenders who do not elect to increase their respective Commitments, in each case
without the consent of the Lenders other than those Lenders increasing their
Commitments. Increases in the Revolving Commitments shall be allocated two-
thirds (2/3) to the Revolving Tranche A Commitments and one-third (1/3) to the
Revolving Tranche B
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Commitments. Any fees payable by the Borrower upon any such increase in the
aggregate Commitments shall be agreed upon by the Agent and the Borrower at the
time of such increase.
(b) Notwithstanding the foregoing, an increase in the aggregate amount of
the Commitments shall be effective only if (i) no Default or Event of Default
shall have occurred and be continuing on the date such increase is to become
effective; (ii) each of the representations and warranties made by the Borrower
in this Agreement and the other Loan Documents shall be true and correct on and
as of the date of the Additional Commitment Notice and the date such increase is
to become effective with the same force and effect as if made on and as of such
date (or, if any such representation or warrant is expressly stated to have been
made as of a specific date, as of such specific date); and (iii) the Agent shall
have received such documents and certificates as the Agent or its counsel may
reasonably request relating to the authorization of such increase.
SECTION 2.23. Special Provisions Regarding Standby Loans. (a) Upon the
------------------------------------------
occurrence of a Sharing Event, automatically (and without the taking of any
action) (x) all then outstanding Eurocurrency Standby Loans shall be
automatically converted into Standby Loans denominated in dollars (in an amount
equal to the Equivalent Dollar Amount of the aggregate principal amount of the
Eurocurrency Standby Loans on the date such Sharing Event first occurred, which
Standby Loans denominated in dollars (i) shall thereafter be deemed to be ABR
Standby Loans and (ii) unless the Sharing Event resulted solely from a
termination of the Commitments, shall be immediately due and payable on the date
such Sharing Event has occurred) and (y) unless the Sharing Event resulted
solely from a termination of the Commitments, all accrued and unpaid interest
and other amounts owing with respect to such Eurocurrency Standby Loans shall be
immediately due and payable in dollars, taking the Equivalent Dollar Amount of
such accrued and unpaid interest and other amounts.
(b) Upon the occurrence of a Sharing Event, and after giving effect to any
automatic conversion pursuant to Section 2.23(a), each Lender shall (and hereby
unconditionally and irrevocably agrees to) purchase and sell (in each case in
dollars) undivided participating interests in all Standby Loans outstanding to,
and any unpaid L/C Disbursement owing by, the Borrower in such amounts so that
each Lender shall have a share of the outstanding Standby Loans and unpaid L/C
Disbursements then owing by the Borrower equal to its Pro Rata Percentage of the
Total Revolving Commitment (although if because of fluctuations in currency
exchange rates any Lender would be required to purchase such participations
after giving effect to which such Lender's Standby Exposure (including
participations therein purchased pursuant to this Section 2.23) would
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exceed such Lender's Revolving Commitment, then such participations shall be in
an amount after giving effect to which such Lender's Standby Exposure (including
participations therein purchased pursuant to this Section 2.23) would equal such
Lender's Revolving Commitment). Upon any such occurrence, the Agent shall notify
each Lender and shall specify the amount of dollars required from such Lender in
order to effect the purchases and sales by the various Lenders of participating
interests in the amounts required above (together with accrued interest with
respect to the period for the last interest payment date through the date of the
Sharing Event plus any additional amounts payable by the Borrowers pursuant to
Section 2.19 in respect of such accrued but unpaid interest); provided, in the
event that a Sharing Event shall have occurred, each Lender shall be deemed to
have purchased, automatically and without request, such participating interests.
Promptly upon receipt of such request, each Lender shall deliver to the Agent
(in immediately available funds in dollars) the net amounts as specified by the
Agent. The Agent shall promptly deliver the amounts so received to the various
Lenders in such amounts as are needed to effect the purchases and sales of
participations as provided above. Promptly following receipt thereof, each
Lender which has sold participations in any of its Standby Loans (through the
Agent) will deliver to each Lender (through the Agent) which has so purchased a
participating interest a participation certificate dated the date of receipt of
such funds and in such amount. It is understood that the amount of funds
delivered by each Lender shall be calculated on a net basis, giving effect to
both the sales and purchases of participations by the various Lenders as
required above.
(c) Upon the occurrence of a Sharing Event (i) no further Standby Loans
shall be made, (ii) all amounts from time to time accruing with respect to, and
all amounts from time to time payable on account of, any outstanding
Eurocurrency Standby Loans (including, without limitation, any interest and
other amounts which were accrued but unpaid on the date of such purchase) shall
be payable in dollars as if such Eurocurrency Standby Loans had originally been
made in dollars and shall be distributed by the relevant Lenders (or their
affiliates) to the Agent for the account of the Lenders which made such Loans or
are participating therein and (iii) the Revolving Commitments of the Lenders
shall be automatically terminated. Notwithstanding anything to the contrary
contained above, the failure of any Lender to purchase its participating
interest in any Standby Loans upon the occurrence of a Sharing Event shall not
relieve any other Lender of its obligation hereunder to purchase its
participating interests in a timely manner, but no Lender shall be responsible
for the failure of any other Lender to purchase the participating interest to be
purchased by such other Lender on any date.
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(d) If any amount required to be paid by any Lender pursuant to Section
2.23(b) is not paid to the Agent within one Business Day following the date upon
which such Lender receives notice from the Agent of the amount of its
participations required to be purchased pursuant to said Section 2.23(b), such
Lender shall also pay to the Agent on demand an amount equal to the product of
(i) the amount so required to be paid by such Lender for the purchase of its
participations times (ii) the daily average Federal Funds Effective Rate during
-----
the period from and including the date of request for payment to the date on
which such payment is immediately available to the Agent times (iii) a fraction
-----
the numerator of which is the number of days that elapsed during such period and
the denominator of which is 360. If any such amount required to be paid by any
Lender pursuant to Section 2.23(b) is not in fact made available to the Agent
within three Business Days following the date upon which such Lender receives
notice from the Agent as to the amount of participations required to be
purchased by it, the Agent shall be entitled to recover from such Lender on
demand, such amount with interest thereon calculated from such request date at
the rate per annum applicable to Standby ABR Loans hereunder. A certificate of
the Agent submitted to any Lender with respect to any amounts payable by any
Lender pursuant to this Section 2.23 shall be paid to the Agent for the account
of the relevant Lenders; provided that, if the Agent (in its sole discretion)
--------
has elected to fund on behalf of such Lender the amounts owing to such Lenders,
then the amounts shall be paid to the Agent for its own account.
(e) Whenever, at any time after the relevant Lenders have received from
any Lenders purchases of participations in any Standby Loans pursuant to this
Section 2.23, the Lenders receive any payment on account thereof, such Lenders
will distribute to the Administrative Agent, for the account of the various
Lenders participating therein, such Lenders' participating interests in such
amounts (appropriately adjusted, in the case of interest payments, to reflect
the period of time during which such participations were outstanding) in like
funds as received; provided, however, that in the event that such payment
-------- -------
received by any Lenders are required to be returned, the Lenders who received
previous distributions in respect of their participating interests therein will
return to the respective Lenders any portion thereof previously so distributed
to them in like funds as such payment is required to be returned by the
respective Lenders.
(f) Each Lender's obligation to purchase participating interests pursuant
to this Section 2.23 shall be absolute and unconditional and shall not be
affected by any circumstance including, without limitation, (a) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against any other Lender, the Borrower or any other Person for any reason
whatsoever, (b) the occurrence or continuance of an Event of Default, (c) any
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adverse change in the condition (financial or otherwise) of the Borrower or any
other Person, (d) any breach of this Agreement by the Borrower, any of its
Subsidiaries or any Lender or any other Person, or (e) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
(g) Notwithstanding anything to the contrary contained elsewhere in this
Agreement, upon any purchase of participations as required above, each Lender
which has purchased such participations shall be entitled to receive from the
Borrower any increased costs and indemnities directly from the Borrower to the
same extent as if it were the direct Lender as opposed to a participant therein.
The Borrower acknowledges and agrees that, upon the occurrence of a Sharing
Event and after giving effect to the requirements of this Section 2.23,
increased Taxes may be owing by the Borrower pursuant to Section 2.19, which
Taxes shall be paid (to the extent provided in Section 2.19) by the Borrower,
without any claim that the increased Taxes are not payable because same resulted
from the participations effected as otherwise required by this Section 2.23.
SECTION 2.24. Replacement of Certain Lenders. In the event any Lender (a)
------------------------------
shall have requested additional compensation from the Borrower under Section
2.13 or Section 2.19 or (b) shall have given notice under Section 2.14 of its
inability to make or maintain as such any Eurocurrency Loan or Eurodollar Loan,
the Borrower may, at its sole expense and effort, require such Lender to
transfer and assign, without recourse (in accordance with Section 9.04) all its
interests, rights and obligations under this Agreement to an assignee which
shall assume such assigned obligations (which assignee may be another Lender, if
a Lender accepts such assignment); provided, however, that (i) such assignment
shall not conflict with any law, rule or regulation or order of any Governmental
Authority, (ii) the Borrower shall have received a written consent of the Agent
in the case of an assignee that is not a Lender, which consent shall not
unreasonably be withheld, and (iii) the Borrower or such assignee shall have
paid to the assigning Lender in immediately available funds the principal of and
interest accrued to the date of such payment on the Loans made by it hereunder
and all other amounts owed to it hereunder.
ARTICLE III. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and the
--------------------
Subsidiaries (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, except for inactive
Subsidiaries that do not engage in any business and whose failure to be validly
existing or in good standing would not reasonably be expected to have a Material
Adverse Effect (b)
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has all requisite power and authority to own its property and assets and to
carry on its business as now conducted and as proposed to be conducted, (c) is
qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a Material
Adverse Effect, and (d) in the case of each Loan Party, has the power and
authority to execute, deliver and perform its obligations under each Loan
Document to which it is party and each other agreement or instrument
contemplated thereby and in the case of the Borrower, to borrow and incur other
obligations hereunder.
SECTION 3.02. Authorization. The execution, delivery and performance by
-------------
each Loan Party of the Loan Documents to which it is to be a party and in the
case of the Borrower the borrowings of the Loans, the use of proceeds thereof
and the Letters of Credit hereunder (collectively, the "Transactions") (a) have
been duly authorized by all requisite action, including approval of such Loan
Party's Board of Directors and if required, stockholder action on the part of
such Loan Party and (b) will not (i) violate (A) any provision of law, statute,
rule or regulation applicable to the Borrower or any Subsidiary, or of the
certificate or articles of incorporation or other constitutive documents or by-
laws of the Borrower or any Subsidiary, (B) any order of any Governmental
Authority or (C) any material provision of any indenture, agreement or other
instrument to which the Borrower or any Subsidiary is a party or by which any of
them or any of their property is or may be bound, (ii) be in conflict with,
result in a breach of or constitute (alone or with notice or lapse of time or
both) a Default under any such indenture, agreement or other instrument or (iii)
result in the creation or imposition of any Lien upon or with respect to any
property or assets now owned or hereafter acquired by the Borrower or any
Subsidiary.
SECTION 3.03. Enforceability. This Agreement has been duly executed and
--------------
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by the Loan Parties party thereto will constitute, a
legal, valid and binding obligation of the Borrower and the other Loan Parties
enforceable against the Borrower and the other Loan Parties in accordance with
its terms.
SECTION 3.04. Governmental Approvals. No action, consent or approval of,
----------------------
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Transactions, except such as have
been made or obtained and are in full force and effect.
SECTION 3.05. Financial Statements. The Borrower has heretofore furnished
--------------------
to the Lenders (i) the combined balance sheets and statements of income and cash
flow of the Borrower and its combined Subsidiaries as of and for the fiscal year
ended December 31, 2000, audited and accompanied by the opinion
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of Xxxxxx Xxxxxxxx LLP, independent public accountants and (ii) the unaudited
combined balance sheets and statements of income and cash flow of the Borrower
and its combined Subsidiaries as of and for the fiscal quarter ended March 31,
2001 certified by the Financial Officer of the Borrower. Such financial
statements present fairly the financial condition and results of operations of
the Borrower and its combined Subsidiaries as of such dates and for such
periods. Such balance sheets and the notes thereto disclose all material
liabilities, direct or contingent, of the Borrower and its combined subsidiaries
as of the dates thereof. Such financial statements and monthly summaries of
pretax income or loss were prepared in accordance with GAAP applied on a
consistent basis.
SECTION 3.06. No Material Adverse Change. As of the date hereof, there has
--------------------------
been no material adverse change in the business, assets, operations, property,
condition, financial or otherwise, material contingent liabilities or material
agreements of the Borrower and the Subsidiaries, taken as a whole, since March
31, 2001 (it being understood that changes in general economic conditions shall
not be deemed to constitute such a material adverse change).
SECTION 3.07. Title to Properties; Possession Under Leases. (a) Each of
--------------------------------------------
the Borrower and the Subsidiaries has good and marketable title to, or valid
leasehold interests in, all its properties and assets, except for minor defects
in title that do not interfere with its ability to conduct its business as
currently conducted or to utilize such properties and assets for their intended
purposes or where such failure would not otherwise, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. All such
material properties and assets are free and clear of Liens, other than Liens
expressly permitted by Section 6.02.
(b) Each of the Borrower and the Subsidiaries has complied with all
obligations under all leases to which it is a party and all such leases are in
full force and effect, except to the extent any failure to do so would not
reasonably be expected to have a Material Adverse Effect. Each of the Borrower
and the Subsidiaries enjoys peaceful and undisturbed possession under all such
material leases, except to the extent any failure to do so would not reasonably
be expected to have a Material Adverse Effect.
SECTION 3.08. Subsidiaries. Schedule 3.08 sets forth as of the date hereof
------------
a list of all Subsidiaries of the Borrower and the percentage ownership interest
of the Borrower therein and the percentage of Consolidated Total Assets owned by
such Subsidiary as of March 31, 2001.
SECTION 3.09. Litigation; Compliance with Laws. (a) There are not any
--------------------------------
actions, suits or proceedings at law or in equity or by or before any
Governmental
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Authority now pending or, to the knowledge of the Borrower, threatened against
or affecting the Borrower or any Subsidiary or any business, property or rights
of any such person (i) which involve any Loan Document or the Transactions
(excluding any such actions, suits or proceedings threatened by the Lenders or
the Agent) or (ii) as to which there is a reasonable probability of an adverse
determination and which, if such probable adverse determination occurred, could,
individually or in the aggregate, reasonably be anticipated to result in a
Material Adverse Effect.
(b) To the best knowledge of the Borrower, neither the Borrower nor any of
the Subsidiaries is in violation of any law, rule or regulation, or in default
with respect to any judgment, writ, injunction or decree of any Governmental
Authority, where such violation or default could reasonably be anticipated to
result in a Material Adverse Effect.
SECTION 3.10. Agreements. (a) Neither the Borrower nor any of the
----------
Subsidiaries is a party to any agreement or instrument or subject to any
corporate or other restriction that has resulted or could reasonably be
anticipated to result in a Material Adverse Effect.
(b) Neither the Borrower nor any of its Subsidiaries is in default in any
manner under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other material agreement or instrument to which
it is a party or by which it or any of its properties or assets are or may be
bound, where such default could reasonably be anticipated to result in a
Material Adverse Effect.
SECTION 3.11. Federal Reserve Regulations. (a) Neither the Borrower nor any
---------------------------
of the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.
(b) Following application of the proceeds of each Loan, not more than 25
percent of the value of the assets of the Borrower subject to the provisions of
Section 6.02 or paragraph (f) of Article VII will be Margin Stock.
SECTION 3.12. Investment Company Act; Public Utility Holding Company Act.
----------------------------------------------------------
Neither the Borrower nor any Subsidiary is (a) an "investment company" as
defined in, or subject to regulation under, the Investment Company Act of 1940
or (b) a "holding company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935.
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SECTION 3.13. Use of Proceeds. The Borrower will use the proceeds of the
---------------
Loans and will request the issuance of Letters of Credit only for the purposes
specified in the preamble to this Agreement.
SECTION 3.14. Tax Returns. Each of the Borrower and the Subsidiaries has
-----------
filed or caused to be filed all Federal, state, local and foreign tax returns
required to have been filed by it and has paid or caused to be paid all taxes
shown to be due and payable on such returns or on any assessments received by
it, except (a) taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary shall have set aside
on its books reserves as shall be required in conformity with GAAP or (b) to the
extent that the failure to do so would not reasonably be expected to have a
Material Adverse Effect.
SECTION 3.15. No Material Misstatements. No information, report, financial
-------------------------
statement, exhibit or schedule furnished by or on behalf of the Borrower to the
Agent or any Lender in connection with the negotiation of any Loan Document or
included therein or delivered pursuant thereto contained or contains any
material misstatement of fact or omitted or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were or are made, not misleading.
SECTION 3.16. Employee Benefit Plans. Each of the Plans, the Borrower and
----------------------
its ERISA Affiliates is in compliance in all material respects with the
applicable provisions of ERISA and the regulations and published interpretations
thereunder. No Reportable Event has occurred as to which the Borrower or any
ERISA Affiliate was required to file a report with the PBGC, and the present
value of all benefit liabilities under each Plan (based on those assumptions
used to fund such Plan) did not, as of the last annual valuation date applicable
thereto, exceed by more than $5,000,000 the value of the assets of such Plan.
Neither the Borrower nor any ERISA Affiliate has incurred any Withdrawal
Liability or any other liability under Title IV of ERISA (other than premiums
not yet due) that. remains unpaid and that could result in a Material Adverse
Effect. Neither the Borrower nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization or has been
terminated within the meaning of Title IV of ERISA, and to the best knowledge of
the Borrower no Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated, where such reorganization or termination has
resulted or could reasonably be expected to result, through increases in the
contributions required to be made to such Plan or otherwise, in a Material
Adverse Effect. Neither the Borrower nor any ERISA Affiliate has received any
notice from the PBGC regarding the funded status of any plan.
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SECTION 3.17. Environmental Matters. Except with respect to matters that
---------------------
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect, the Borrower and each Subsidiary has complied with all
Federal, state, local and other statutes, ordinances, orders, judgments, rulings
and regulations relating to environmental pollution or to environmental
regulation or control or to employee health or safety. Except with respect to
matters that individually or in the aggregate would not reasonably be expected
to have a Material Adverse Effect, neither the Borrower nor any Subsidiary has
received notice of any failure so to comply. Except with respect to matters that
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect, the Borrower's and the Subsidiaries facilities do not
manage any hazardous wastes, hazardous substances, hazardous materials, toxic
substances, toxic pollutants or substances similarly denominated, as those terms
or similar terms are used in the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response Compensation and Liability Act, the
Hazardous Materials Transportation Act, the Toxic Substance Control Act, the
Clean Air Act, the Clean Water Act or any other applicable law, in violation of
any such law or any regulations promulgated pursuant thereto.
SECTION 3.18. Solvency. As of the Effective Date:
--------
(a) The fair salable value of the assets of the Borrower and each
Guarantor will exceed the amount that will be required to be paid on or in
respect of the existing debts and other liabilities of the Borrower or
Guarantor as such debts and liabilities mature.
(b) Except in the case of a refinancing of a Standby Borrowing with a
new Standby Borrowing that does not increase the aggregate principal amount
of the Loans of any Lender outstanding, the assets of the Borrower and each
Guarantor do not constitute unreasonably small capital for the Borrower or
Guarantor to carry out its businesses as now conducted and as proposed to
be conducted.
(c) None of the Borrower or any Guarantor intends to incur debts or
liabilities beyond its ability to pay such debts and liabilities as they
mature.
ARTICLE IV. CONDITIONS OF LENDING
The effectiveness of this Agreement and the obligations of the Lenders to
make Loans and of the Issuing Bank to issue, extend or renew Letters of Credit
hereunder are subject to the satisfaction of the following conditions:
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SECTION 4.01. All Credit Events. On the date of each Borrowing or issuance,
-----------------
extension or renewal of a Letter of Credit (each such event being called a
"Credit Event"):
(a) The Agent shall have received a notice of such Credit Event as
required by Section 2.03, Section 2.04, or Section 2.20, as the case may be
(or such notice shall have been deemed given in accordance with Section
2.04).
(b) Except in the case of a refinancing of a Standby Borrowing with a
new Standby Borrowing that does not increase the aggregate principal amount
of the Loans of any Lender outstanding, the representations and warranties
set forth in Article III hereof shall be true and correct in all material
respects on and as of the date of such Credit Event with the same effect as
though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date.
(c) No Default or Event of Default shall have occurred and be
continuing.
Each Credit Event shall be deemed to constitute a representation and warranty by
the Borrower on the date of such Credit Event as to the matters specified in
paragraphs (b) and (c) of this Section 4.01.
SECTION 4.02. First Credit Event. On the Effective Date:
------------------
(a) The Agent shall have received (i) a copy of the certificate or
articles of incorporation (or analogous documents) and all amendments
thereto of each Loan Party certified as of a recent date by the Secretary
of State (or other appropriate Governmental Authority) of the state (or
country) of its organization or such other evidence as is reasonably
satisfactory to the Agent; (ii) a certificate as to the good standing (or
other analogous certification to the extent available) of each Loan Party
as of a recent date, from the appropriate Secretary of State (or other
appropriate Governmental Authority) or such other evidence as is reasonably
satisfactory to the Agent; (iii) a certificate of the Secretary or
Assistant Secretary of each Loan Party dated the Effective Date and
certifying (A) that attached thereto is a true and complete copy of the by-
laws (or such other analogous documents to the extent available) of such
Loan Party as in effect on the Effective Date and at all times since a date
prior to the date of the resolutions described in clause (B) below, (B)
that attached thereto is a true and complete copy of resolutions duly
adopted by the Board of
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Directors of such Loan Party authorizing the execution, delivery and
performance of the Loan Documents to which it is party, and in the case of
the Borrower, the borrowings hereunder, and that such resolutions have not
been modified, rescinded or amended and are in full force and effect, (C)
that the certificate or articles of incorporation (or analogous documents)
of such Loan Party have not been amended since the date of the last
amendment thereto shown on the certificate of good standing (or other
analogous certification or such other evidence reasonably satisfactory to
the Agent) furnished pursuant to clause (i) or (ii) above, and (D) as to
the incumbency and specimen signature of each officer executing any Loan
Document or any other document delivered in connection herewith on behalf
of such Loan Party; (iv) a certificate of another officer as to the
incumbency and specimen signature of the Secretary or Assistant Secretary
executing the certificate pursuant to (iii) above; and (v) such other
documents as the Agent, the Lenders or the Issuing Bank may reasonably
request.
(b) The Agent shall have received a certificate of the Borrower,
dated the Effective Date and signed by a Financial Officer of the Borrower
confirming compliance with the conditions precedent set forth in paragraphs
(b) and (c) of Section 4.01.
(c) The Agent shall have received all Fees and other amounts due and
payable on or prior to the Effective Date.
(d) The Agent shall have received a favorable written opinion of in-
house counsel to the Borrower and the Guarantors and Xxxxxx & Xxxxxxx,
special counsel to the Borrower and the Guarantors, each dated the
Effective Date and addressed to the Agent, the Lenders and the Issuing
Bank, in form and substance satisfactory to the Agent and the Lenders, and
the Borrower hereby instructs such counsel to deliver such opinions to the
Agent.
(e) Neither the Borrower nor any of its Subsidiaries shall have
outstanding any Indebtedness, other than (i) Indebtedness incurred under
the Loan Documents and (ii) other Indebtedness permitted under Section 6.01
and outstanding on the Effective Date.
(f) The Existing Credit Agreement and all commitments thereunder to
lend shall have been terminated, all letters of credit issued thereunder
shall have been terminated or converted into Letters of Credit under this
Agreement, all amounts outstanding thereunder shall have been paid in full
and all Liens, if any, securing any obligations thereunder or
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under any related agreement shall have been permanently released and (ii)
the Agent shall have received evidence satisfactory in form and substance
to it demonstrating such termination, payment and release.
(g) The Agent shall have received a counterpart of the Guarantee
Agreement signed on behalf of each Subsidiary Loan Party.
The Agent shall notify the Borrower and the Lenders of the Effective Date,
and such notices shall be conclusive and binding. Notwithstanding the foregoing,
the obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of Credit hereunder shall not become effective unless each of the
foregoing conditions is satisfied (or waived pursuant to Section 9.08) at or
prior to 5:00 p.m., New York City time, on July 31, 2001 (and, in the event such
conditions are not so satisfied or waived, the Commitments shall terminate at
such time).
ARTICLE V. AFFIRMATIVE COVENANTS
The Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect or the principal of or interest on any Loan,
any Fees or any other expenses or amounts payable under any Loan Document shall
be unpaid, and until all Letters of Credit have been canceled or have expired
and all amounts drawn thereunder have been reimbursed in full, unless the
Required Lenders shall otherwise consent in writing, the Borrower shall, and
shall cause each of the Subsidiaries to:
SECTION 5.01. Existence; Businesses and Properties. (a) Do or cause to be
------------------------------------
done all things necessary to preserve, renew and keep in full force and effect
its legal existence, except as otherwise expressly permitted under Section 6.05,
and except for inactive Subsidiaries that do not engage in any business and
whose failure to maintain legal existence would not reasonably be expected to
have a Material Adverse Effect.
(b) Do or cause to be done all things necessary to obtain, preserve,
renew, extend and keep in full force and effect the rights, licenses, permits,
franchises, authorizations, patents, copyrights, trademarks and trade names used
in the conduct of its business, except to the extent any failure to do so would
not reasonably be expected to have a Material Adverse Effect; comply with all
applicable laws, rules, regulations and orders of any Governmental Authority,
whether now in effect or hereafter enacted, except to the extent any failure to
do so would not reasonably be expected to have a Material Adverse Effect;
(c) (i) maintain and operate its business in primarily the manner in which
it is presently conducted and operated; and (ii) at all times maintain and
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preserve all property used in the conduct of such business and keep such
property in good repair, working order and condition and from time to time make,
or cause to be made, all needful and proper repairs, renewals, additions,
improvements and replacements thereto necessary in order that the business
carried on in connection therewith may be properly conducted at all times;
provided that in each case (i) and (ii) the foregoing shall not prohibit the
Borrower or any Subsidiary from discontinuing or changing the operation and
maintenance of any Subsidiary, property or business if such discontinuance or
change would not reasonably be expected to have a Material Adverse Effect.
SECTION 5.02. Insurance. Keep its insurable properties adequately insured
---------
at all times by financially sound and reputable insurers; maintain such other
insurance, to such extent and against such risks, including fire and other risks
insured against by extended coverage, as is customary with companies in the same
or similar businesses, including public liability insurance against claims for
personal injury or death or property damage occurring upon, in, about or in
connection with the use of any properties owned, occupied or controlled by it;
and maintain such other insurance as may be required by law.
SECTION 5.03. Taxes. Pay and discharge promptly when due all taxes,
-----
assessments and governmental charges or levies imposed upon it or upon its
income or profits or in respect of its property, before the same shall become
delinquent or in default, as well as all lawful and valid claims for labor,
materials and supplies or otherwise which, if unpaid, would reasonably be
expected to have a Material Adverse Effect; provided, however, that such payment
and discharge shall not be required with respect to any such tax, assessment,
charge, levy or claim so long as the validity or amount thereof shall be
contested in good faith by appropriate proceedings and the Borrower or such
Subsidiary shall have set aside on its books reserves with respect thereto as
shall be required in conformity with GAAP.
SECTION 5.04. Financial Statements, Reports, etc. In the case of the
----------------------------------
Borrower, furnish to the Agent and each Lender:
(a) within 100 days after the end of each fiscal year, its audited
consolidated balance sheets and related statements of income and cash flow,
showing the financial condition of the Borrower and its consolidated
Subsidiaries as of the close of such fiscal year and the results of its
operations and the operations of such subsidiaries during such year, all
audited by Xxxxxx Xxxxxxxx LLP or other independent public accountants of
recognized national standing acceptable to the Agent and accompanied by an
opinion of such accountants (which shall not be qualified in any material
respect) to the effect that such consolidated financial statements
fairly present the financial condition and results of operations of the
Borrower on a consolidated basis in accordance with GAAP consistently
applied;
(b) within 50 days after the end of each of the first three fiscal
quarters of each fiscal year, its unaudited consolidated balance sheets and
related statements of income and cash flow, showing the financial condition
of the Borrower and its consolidated subsidiaries as of the close of such
fiscal quarter and the results of its operations and the operations of such
subsidiaries during such fiscal quarter and the then elapsed portion of the
fiscal year, all certified by the Financial Officer of the Borrower as
fairly presenting the financial condition and results of operations of the
Borrower on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of the accounting firm or the
Financial Officer of the Borrower opining on or certifying such statements
(which certificate, when furnished by an accounting firm, may be limited to
accounting matters and disclaim responsibility for legal interpretations)
(i) certifying that no Event of Default or Default has occurred
or, if such an Event of Default or Default has occurred, specifying
the nature and extent thereof and any corrective action taken or
proposed to be taken with respect thereto and (ii) setting forth
computations in reasonable detail satisfactory to the Agent
demonstrating compliance with the covenants contained in Sections
6.12, 6.13 and Section 6.14;
(d) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
it with the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of or all the functions of said Commission, or
with any national securities exchange, or distributed to its shareholders,
as the case may be; and
(e) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrower or any
Subsidiary, or compliance with the terms of any Loan Document, as the Agent
or any Lender may reasonably request.
SECTION 5.05. Litigation and Other Notices. Furnish to the Agent, the
----------------------------
Issuing Bank and each Lender prompt written notice of the following:
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(a) any Event of Default or Default, specifying the nature and extent
thereof and the corrective action (if any) proposed to be taken with
respect thereto;
(b) the filing or commencement of, or any written threat or notice of
intention of any person to file or commence, any action, suit or
proceeding, whether at law or in equity or by or before any Governmental
Authority, against the Borrower or any Affiliate thereof as to which there
is a reasonable probability of an adverse determination and which, if such
probable adverse determination occurred, could reasonably be anticipated to
result in a Material Adverse Effect; and
(c) any development that has resulted in, or could reasonably be
anticipated to result in, a Material Adverse Effect.
SECTION 5.06. ERISA.
-----
(a) Comply in all material respects with the applicable provisions of
ERISA and (b) furnish to the Agent and each Lender (i) as soon as possible, and
in any event within 30 days after any Responsible Officer of the Borrower or any
ERISA Affiliate either knows or has reason to know that any Reportable Event has
occurred that alone or together with any other Reportable Event could reasonably
be expected to result in liability of the Borrower or any ERISA Affiliate in an
aggregate amount exceeding $5,000,000, a statement of a Financial Officer of the
Borrower setting forth details as to such Reportable Event and the action
proposed to be taken with respect thereto, together with a copy of the notice,
if any, of such Reportable Event given to the PBGC, (ii) promptly after receipt
thereof, a copy of any notice the Borrower or any ERISA Affiliate may receive
from the PBGC relating to the funded status of any Plan or to the intention of
the PBGC to terminate any Plan or Plans (other than a Plan maintained by an
ERISA Affiliate which is considered an ERISA Affiliate only pursuant to
subsection (m) or (o) of Section 414 of the Code) or to appoint a trustee to
administer any Plan or Plans, (iii) within ten (10) days after the due date for
filing with the PBGC pursuant to Section 412(n) of the Code of a notice of
failure to make a required installment or other payment with respect to a Plan,
a statement of a Financial Officer of the Borrower setting forth details as to
such failure and the action proposed to be taken with respect thereto, together
with a copy of such notice given to the PBGC and (iv) promptly and in any event
within 30 days after receipt thereof by the Borrower or any ERISA Affiliate from
the sponsor of a Multiemployer Plan, a copy of each notice received by the
Borrower or any ERISA Affiliate concerning (A) the imposition of Withdrawal
Liability in excess of $500,000 or (B) a determination that a Multiemployer Plan
is, or is
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expected to be, terminated or in reorganization, in each case within the meaning
of Title IV of ERISA.
SECTION 5.07. Maintaining Records; Access to Properties and Inspections.
---------------------------------------------------------
Maintain all financial records in accordance with GAAP and upon reasonable
notice by any Lender permit any representatives designated by such Lender,
subject to Section 9.16 of this Agreement, to visit and inspect the financial
records and the properties of the Borrower or any Subsidiary at reasonable times
during normal business hours and as often as requested and to make extracts from
and copies of such financial records, and permit any representatives designated
by any Lender to discuss the affairs, finances and condition of the Borrower or
any Subsidiary with the officers thereof and independent accountants therefor.
SECTION 5.08. Use of Proceeds. Use the proceeds of the Loans and request
---------------
the issuance of Letters of Credit only for the purposes set forth in the
preamble to, this Agreement.
SECTION 5.09. Subsidiaries. (a) If any additional Subsidiary is formed or
------------
acquired after the Effective Date, the Borrower will notify the Agent and the
Lenders thereof. If any Domestic Subsidiary has or acquires assets greater than
or equal to 10% of Consolidated Total Assets or any Foreign Subsidiary has or
acquires assets greater than or equal to 15% of Consolidated Total Assets, the
Borrower will cause such Subsidiary and each Subsidiary that directly or
indirectly owns capital stock of such Subsidiary (other than a Foreign
Subsidiary which is not required to become a party to the Guarantee Agreement to
make enforceable under applicable law the Guarantee Agreement of such
Subsidiary) to become a party to the Guarantee Agreement within ten (10)
Business Days after delivery of the compliance certificate under 5.04(c)
demonstrating the need for any such Subsidiary to become a Guarantor. If any
other Subsidiaries have or acquire assets having a value that would cause a
breach of Section 6.14, the Borrower will cause those Subsidiaries designated by
the Borrower and sufficient to achieve compliance with Section 6.14 to become
party to the Guarantee Agreement within ten (10) Business Days after delivery of
the compliance certificate under 5.04(c) demonstrating the need for one or more
additional Subsidiaries to become a Guarantor.
(b) Other than during the continuance of a Default or Event of Default, at
the request of the Borrower, the Agent shall release any Guarantor from the
Guarantee Agreement in connection with the sale, transfer or other disposition
of such Guarantor or all or substantially all of the assets owned by such
Subsidiary in an Asset Sale or in a transfer among such Guarantor and the
Borrower and/or another Guarantor; provided that prior to any such release the
Borrower shall
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deliver a certificate of the Financial Officer of the Borrower setting forth in
reasonable detail computations evidencing compliance with Section 6.14 on a pro
forma basis after giving effect to such release and certifying that no Default
or Event of Default has occurred and is continuing, or would occur after giving
effect to such release.
ARTICLE VI. NEGATIVE COVENANTS
The Borrower covenants and agrees with each Lender, the Issuing Bank and
the Agent that, so long as this Agreement shall remain in effect or the
principal of or interest on any Loan, any Fees or any other expenses or amounts
payable under any Loan Document shall be unpaid, and until all Letters of Credit
have been canceled or have expired and all amounts drawn thereunder have been
reimbursed in full, unless the Required Lenders shall otherwise consent in
writing, the Borrower shall not, and shall not cause or permit any of the
Subsidiaries to:
SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist any
------------
Indebtedness if (a) a Default or an Event of Default would exist after giving
effect to such Indebtedness or (b) in the case of Indebtedness incurred by a
Foreign Subsidiary that is not a Guarantor, such Indebtedness is Recourse to the
Borrower or any Subsidiary Loan Party.
SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien on
-----
any property or assets (including stock or other securities of any person,
including any Subsidiary) now owned or hereafter acquired by it or on any income
or revenues or rights (excluding rights of first refusal) in respect of any
thereof, except (without duplication):
(a) Liens on property or assets of the Borrower and its Subsidiaries
existing on the date hereof and set forth in Schedule 6.02; provided,
however, that such Liens shall secure only those obligations which they
secure on the date hereof except as otherwise permitted hereunder;
(b) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary; provided, however,
that (i) such Lien is not created in contemplation of or in connection with
such acquisition and (ii) such Lien does not apply to any other property or
assets of the Borrower or any Subsidiary;
(c) Liens for taxes not yet due or which are being contested in
compliance with Section 5.03;
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(d) carriers', warehousemen's, mechanics, materialmen's, repairmen's
or other like Liens arising in the ordinary course of business and securing
obligations that are not due or which are being contested in compliance
with Section 5.03;
(e) statutory liens of landlords in respect of property leased by the
Borrower or any Subsidiary;
(f) pledges and deposits made in the ordinary course of business in
compliance with workmen's compensation, unemployment insurance and other
social security laws or regulations;
(g) deposits to secure the performance of bids, trade contracts
(other than for Indebtedness), leases (other than Capital Lease
Obligations), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary
course of business;
(h) zoning restrictions, easements, rights-of-way, restrictions on
use of real property and other similar encumbrances incurred in the
ordinary course of business which, in the aggregate, are not substantial in
amount and do not materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the
Borrower or any of its Subsidiaries;
(i) Liens created under the Loan Documents to secure the Obligations;
(j) other Liens to secure permitted purchase-money Indebtedness
(including Capital Lease Obligations) and other Non-Recourse Indebtedness
of the Borrower or any Subsidiary; provided that (i) such Lien does not
apply to any property or assets of the Borrower or any Subsidiary
consisting of franchise brands (whether now owned or hereafter acquired)
and related franchise agreements and (ii) such Lien is limited to the
property and assets acquired in connection with such financing and the
proceeds thereof.
(k) other Liens to secure Recourse Indebtedness of the Borrower or
any Subsidiary; provided that (i) such Lien does not apply to any property
or assets of the Borrower or such Subsidiary consisting of franchise brands
(whether now owned or hereafter acquired) and related franchise agreements
and (ii) the aggregate outstanding principal amount
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of Recourse Indebtedness secured by Liens shall not exceed $25,000,000 at
any time.
SECTION 6.03. Sale and Lease-Back Transactions. Enter into any Sale and
--------------------------------
Lease-Back Transaction unless immediately thereafter the value (determined as of
the time of sale in accordance with GAAP) of all property the subject of Sale
and Lease-Back Transactions, when added to the aggregate principal amount of
Indebtedness of the Borrower or any Subsidiary secured at such time by Liens
permitted only under Sections 6.02(j) and (k), does not exceed 15% of
Consolidated Total Assets at such time.
SECTION 6.04. Investments, Loans and Advances. Purchase, hold or acquire
-------------------------------
any capital stock, comparable ownership interests, evidences of indebtedness or
other securities of, make or permit to exist any loans or advances to, or make
or permit to exist any investment or any other interest in, any other person,
except:
(a) the investments and guarantees existing on the date hereof set
forth on Schedule 6.04 and investments by the Borrower or any Subsidiary in
the capital stock or comparable ownership interests of the Subsidiaries,
including by means of contributions by any Subsidiary of Hotel Properties
to the Borrower or a Subsidiary; provided that if a Default or an Event of
Default has occurred and is continuing, the Borrower or a Subsidiary Loan
Party may not invest in the capital stock or comparable ownership interests
of any Subsidiary that is not a Subsidiary Loan Party;
(b) loans or advances by the Borrower to Subsidiaries or by
Subsidiaries to the Borrower or other Subsidiaries, in each case to the
extent no Default or Event of Default would exist after giving effect
thereto;
(c) Permitted Liquid Investments;
(d) so long as no Default or Event of Default has occurred and is
continuing, loans and advances by the Borrower and its Subsidiaries to
their employees, officers, and directors in the ordinary course of business
in an aggregate amount outstanding at any time not in excess of $5,000,000;
(e) other investments, capital contributions, Guarantees, loans and
advances made in connection with hospitality-related business activities so
long as (i) no Default or Event of Default has occurred and is continuing,
or would exist after giving effect thereto and (ii) after giving effect
thereto, the Borrower and the Subsidiaries, taken as a whole, will continue
to engage primarily in the business of hotel franchising.
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SECTION 6.05. Mergers and Consolidations. Merge into or consolidate with
--------------------------
any other person, or permit any other person to merge into or consolidate with
it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all its assets whether now owned or
hereafter acquired, except that:
(a) (i) the Borrower may merge or consolidate with a Subsidiary or
(ii) a Subsidiary may merge or consolidate with the Borrower, in each case
so long as the Borrower is the surviving entity;
(b) any Subsidiary may merge or consolidate with any Subsidiary; and
(c) the Borrower or any Subsidiary may merge or consolidate with
another person; provided, however, that:
(i) the Borrower or such Subsidiary is the surviving entity,
or in the case of a Subsidiary, such merger or consolidation of such
Subsidiary into another person is an Asset Sale permitted hereunder;
(ii) no Default or Event of Default has occurred and is
continuing, or would exist after giving effect to such merger or
consolidation; and
(iii) the Agent shall receive a certificate signed by a
Financial Officer of the Borrower confirming compliance with clause
(ii) above.
SECTION 6.06. Asset Sales. Consummate any Asset Sale if (a) a Default or
-----------
Event of Default has occurred and is continuing, or would occur after giving
effect thereto or (b) the assets or properties subject to such Asset Sale
consist of any franchise brand (whether now owned or hereafter acquired) and the
franchise agreements related to such brand.
SECTION 6.07. Transactions with Affiliates. Sell or transfer any property
----------------------------
or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its Affiliates unless (i) such
transaction is conducted in the ordinary course of business at prices and on
terms and conditions not less favorable to the Borrower or such Subsidiary than
could be obtained on an arms-length basis from unrelated third parties or (ii)
such transaction is between or among the Borrower and the Guarantors; provided
that the Borrower or any Subsidiary may not engage in any of the foregoing
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transactions with an Affiliate that is not a Subsidiary Loan Party if a Default
or an Event of Default has occurred and is continuing.
SECTION 6.08. Business of Borrower and Subsidiaries. Engage at any time in
-------------------------------------
any business or business activity other than the business currently conducted by
it or other hospitality-related activities; provided that the Borrower and the
Subsidiaries, taken as a whole, shall at all times engage primarily in the
business of hotel franchising.
SECTION 6.09. Agreements. Permit any Subsidiary Loan Party to enter into
----------
any agreement or incur any obligation the terms of which would impair the
ability of any Subsidiary Loan Party to pay dividends, to make intercompany
loans or advances or to make distributions (it being agreed that this Section
shall not be breached by any such agreement or obligation binding upon a
Subsidiary at the time it becomes a Subsidiary and not incurred in contemplation
of its becoming a Subsidiary).
SECTION 6.10. Fiscal Year. Change its fiscal year end from that in effect
-----------
at December 31, 2000, other than as required by GAAP.
SECTION 6.11. No Further Negative Pledges. Except with respect to
---------------------------
prohibitions against other encumbrances on specific property encumbered to
secure payment of particular Indebtedness (which Indebtedness relates solely to
such specific property, and improvements and accretions thereto and proceeds
thereof, and is otherwise permitted hereby), enter into any agreement
prohibiting the creation or assumption of any Lien upon the properties or assets
of the Borrower or any Subsidiary Loan Party, whether now owned or hereafter
acquired, or requiring an obligation to be secured if some other obligation is
secured; provided that the foregoing shall not apply to any prohibitions or
requirements set forth in any Loan Document or set forth in the Indenture dated
May 4, 1998 for the Borrower's Senior Notes due 2008, as amended or supplemented
and in effect from time to time on terms not materially less favorable to the
Lenders than in effect on the date hereof.
SECTION 6.12. Consolidated Leverage Ratio. In the case of the Borrower,
---------------------------
permit the Consolidated Leverage Ratio as of the last day of and for any period
of four fiscal quarters ending during the period from and including the date
hereof through the Term Maturity Date and the Revolving Maturity Date to exceed
3.25 to 1.0. The Consolidated Leverage Ratio shall be calculated as of the end
of each fiscal quarter based on the period of the four consecutive fiscal
quarters ending on such date.
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SECTION 6.13. Consolidated Interest Coverage Ratio. In the case of the
------------------------------------
Borrower, permit the Consolidated Interest Coverage Ratio for any period of four
fiscal quarters ending during the period from and including the date hereof
through the Term Maturity Date and the Revolving Maturity Date to be less than
3.75 to 1.00. The Consolidated Interest Coverage Ratio shall be calculated as of
the end of each fiscal quarter based on the period of the four consecutive
fiscal quarters ending on such date.
SECTION 6.14. Required Guarantors. Permit (a) as of the last day of any
-------------------
fiscal quarter, (i) the Consolidated Total Assets owned or controlled by
Domestic Subsidiaries that are not Guarantors to exceed 10% of Consolidated
Total Assets or (ii) the Consolidated Total Assets owned or controlled by
Foreign Subsidiaries that are not Guarantors to exceed 15% of Consolidated Total
Assets, and (b) any such failure to continue beyond the time period for
additional Subsidiaries to become parties to the Guarantee Agreement as required
by Section 5.09.
ARTICLE VII. EVENTS OF DEFAULT
In case of the happening of any of the following events ("Events of
Default''):
(a) any representation or warranty made or deemed made (such
representation or warranty being deemed made as provided in Section 4.01)
in or in connection with any Loan Document or the borrowings or issuances
of Letters of Credit hereunder, or any representation, warranty, statement
or information contained in any report, certificate, financial statement or
other instrument furnished in connection with or pursuant to any Loan
Document, shall prove to have been false or misleading in any material
respect when so made, deemed made or furnished;
(b) default shall be made in the payment of any principal of any Loan
or the reimbursement with respect to any L/C Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or by acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on any Loan
or any Fee or L/C Disbursement or any other amount (other than an amount
referred to in clause (b) above) due under any Loan Document, when and as
the same shall become due and payable, and such default shall continue
unremedied for a period of five Business Days;
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(d) default shall be made in the due observance or performance by the
Borrower of any covenant, condition or agreement contained in Section
5.01(a) or 5.09 or in Article VI;
(e) default shall be made in the due observance or performance by the
Borrower of any covenant, condition or agreement contained in any Loan
Document (other than those specified in clauses (b), (c) and (d) above) and
such default shall continue unremedied for a period of ten (10) Business
Days after notice thereof from the Agent to the Borrower;
(f) the Borrower or any other Credit Party shall (i) fail to pay any
principal or interest due in respect of any Indebtedness in an aggregate
principal amount in excess of $10,000,000, when and as the same shall
become due and payable, or (ii) fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or instrument
evidencing or governing any Indebtedness in an aggregate principal amount
in excess of $10,000,000, or permit any other event to occur, if the effect
of any failure or event referred to in this clause (ii) is to cause, or to
permit the holder or holders of such Indebtedness or a trustee on its or
their behalf (with or without the giving of notice, the lapse of time or
both) to cause, such Indebtedness to become due prior to its stated
maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of the Borrower or any other Credit Party, or of a
substantial part of the property or assets of the Borrower or any other
Credit Party, under Title 11 of the United States Code, as now constituted
or hereafter amended, or any other Federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any other Credit Party, or for a substantial part of
the property or assets of the Borrower or any other Credit Party, or (iii)
the winding-up or liquidation of the Borrower or any other Credit Party;
and such proceeding or petition shall continue undismissed for 90 days or
an order or decree approving or ordering any of the foregoing shall be
entered;
(h) the Borrower or any other Credit Party, shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11
of the United States Code, as now constituted or hereafter amended, or any
other Federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or the filing of any petition
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described in clause (g) above, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any other Credit Party or for a
substantial part of the property or assets of the Borrower or any other
Credit Party, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general
assignment for the benefit of creditors, (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become due
or (vii) take any action for the purpose of effecting any of the foregoing;
(i) one or more judgments for the payment of money in an aggregate
amount in excess of $10,000,000 shall be rendered against the Borrower, any
other Credit Party or any combination thereof and the same shall remain
undischarged for a period of 90 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken by a
judgment creditor to levy upon assets or properties of the Borrower or any
other Credit Party to enforce any such judgment and such action has not
been effectively stayed within ten (10) days;
(j) a Reportable Event or Reportable Events, or a failure to make a
required installment or other payment (within the meaning of Section
412(n)(1) of the Code), shall have occurred with respect to any Plan or
Plans that reasonably could be expected to result in liability of the
Borrower to the PBGC or to a Plan in an aggregate amount exceeding
$5,000,000 and, within 30 days after the reporting of any such Reportable
Event to the Agent or after the receipt by the Agent of the statement
required pursuant to Section 5.06, the Agent shall have notified the
Borrower in writing that (i) the Required Lenders have made a determination
that, on the basis of such Reportable Event or Reportable Events or the
failure to make a required payment, there are reasonable grounds (A) for
the termination of such Plan or Plans by the PBGC, (B) for the appointment
by the appropriate United States District Court of a trustee to administer
such Plan or Plans or (C) for the imposition of a lien in favor of a Plan
or the PBGC and (ii) as a result thereof an Event of Default exists
hereunder; or a trustee shall be appointed by a United States District
Court to administer any such Plan or Plans; or the PBGC shall institute
proceedings to terminate any Plan or Plans;
(k) (i) 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, (ii) the Borrower or such ERISA
Affiliate does not have reasonable grounds for contesting such
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Withdrawal Liability or is not in fact contesting such Withdrawal Liability
in a timely and appropriate manner and (iii) the amount of the Withdrawal
Liability specified in such notice, when aggregated with all other amounts
required to be paid to Multiemployer Plans in connection with Withdrawal
Liabilities (determined as of the date or dates of such notification),
exceeds $5,000,000 or requires payments exceeding $1,000,000 in any year;
(1) 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, if solely as a result of such reorganization or termination the
aggregate annual contributions of the Borrower and its ERISA Affiliates to
all Multiemployer Plans that are then in reorganization or have been or are
being terminated have been or will be increased over the amounts required
to be contributed to such Multiemployer Plans for their most recently
completed plan years by an amount exceeding $1,000,000; or
(m) there shall have occurred a Change in Control;
then, and in every such event (other than an event with respect to the
Borrower described in clause (g) or (h) above), and at any time thereafter
during the continuance of such event, the Agent, at the request of the
Required Lenders, shall, by notice to the Borrower, take any or all of the
following actions, at the same or different times: (i) terminate forthwith
the Commitments, (ii) declare the Loans then outstanding to be forthwith
due and payable in whole or in part, whereupon the principal of the Loans
so declared to be due and payable, together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Borrower
accrued hereunder and under any other Loan Document, shall become forthwith
due and payable, without presentment, demand, protest or any other notice
of any kind, all of which are hereby expressly waived by the Borrower,
anything contained herein or in any other Loan Document to the contrary
notwithstanding and (iii) require cash collateral as contemplated by
Section 2.20(i); and in any event with respect to the Borrower described in
clause (g) or (h) above, the Commitments shall automatically terminate and
the principal of the Loans then outstanding, together with accrued interest
thereon and any unpaid accrued Fees and all other liabilities of the
Borrower accrued hereunder and under any other Loan Document, shall
automatically become due and payable, and the Borrower shall automatically
be required to provide cash collateral in respect of outstanding Letters of
Credit, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by the
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Borrower, anything contained herein or in any other Loan Document to the
contrary notwithstanding.
ARTICLE VIII. THE AGENT
In order to expedite the transactions contemplated by this Agreement, The
Chase Manhattan Bank is hereby appointed to act as Agent on behalf of the
Lenders and the Issuing Bank. Each of the Lenders hereby irrevocably authorizes
the Agent to take such actions on behalf of such Lender or Issuing Bank and to
exercise such powers as are specifically delegated to the Agent by the terms and
provisions hereof, together with such actions and powers as are reasonably
incidental thereto. The Agent is hereby expressly authorized by the Lenders and
the Issuing Bank, without hereby limiting any implied authority, (a) to receive
on behalf of the Lenders and the Issuing Bank all payments of principal of and
interest on the Loans, all payments in respect of L/C Disbursements and all
other amounts due to the Lenders hereunder, and promptly to distribute to each
Lender or Issuing Bank its proper share of each payment so received; (b) to give
notice on behalf of each of the Lenders to the Borrower of any Event of Default
specified in this Agreement of which the Agent has actual knowledge acquired in
connection with its agency hereunder; and (c) to distribute to each Lender
copies of all notices, financial statements and other materials delivered
pursuant to this Agreement as received by the Agent.
Neither the Agent nor any of its directors, officers, employees or agents
shall be liable to the Lenders as such for any action taken or omitted by any of
them except for its or his own gross negligence or willful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith (other than any statement,
representation or warranty relating to the Agent or relating to the functions of
the Agent hereunder), or be required to ascertain or to make any inquiry
concerning the performance or observance by the Borrower of any of the terms,
conditions, covenants or agreements contained in any Loan Document. The Agent
shall not be responsible to the Lenders for the due execution, genuineness,
validity, enforceability or effectiveness of this Agreement or any other Loan
Documents or other instruments or agreements. The Agent may deem and treat the
payee of any note referred to in Section 2.07 as the owner thereof for all
purposes hereof until it shall have received from the payee of such note notice,
given as provided herein, of the transfer thereof. The Agent shall in all cases
be fully protected in acting, or refraining from acting, in accordance with
written instructions signed by the Required Lenders and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders. The Agent shall, in the
absence of knowledge to the contrary, be
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entitled to rely on any instrument or document believed by it in good faith to
be genuine and correct and to have been signed or sent by the proper person or
persons. Neither the Agent nor any of its directors, officers, employees or
agents shall have any responsibility to the Borrower on account of the failure
of or delay in performance or breach by any Lender or Issuing Bank of any of its
obligations hereunder or to any Lender or Issuing Bank on account of the failure
of or delay in performance or breach by any other Lender or Issuing Bank or the
Borrower of any of their respective obligations hereunder or under any other
Loan Document or in connection herewith or therewith. The Agent may execute any
and all duties hereunder by or through agents or employees and shall be entitled
to rely upon the advice of legal counsel selected by it with respect to all
matters arising hereunder and shall not be liable for any action taken or
suffered in good faith by it in accordance with the advice of such counsel.
The Lenders hereby acknowledge that the Agent shall be under no duty to
take any discretionary action permitted to be taken by it pursuant to the
provisions of this Agreement unless it shall be requested in writing to do so by
the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as provided
below, the Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor subject to the written consent of the Borrower to such
successor (which consent will not be unreasonably withheld). If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 Business Days after the retiring Agent gives notice
of its resignation, then the retiring Agent may, on behalf of the Lenders, after
conferring with the Borrower, appoint a successor Agent which shall be a bank
with offices in New York, New York and London, England, having a combined
capital and surplus of at least $500,000,000 or an Affiliate of any such bank.
Upon the acceptance of any appointment as Agent hereunder by a successor bank,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent and the retiring Agent shall be
discharged from its duties and obligations hereunder. After the Agent's
resignation hereunder, the provisions of this Article and Section 9.05 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent.
With respect to the Loans made by it hereunder, the Agent in its individual
capacity and not as Agent shall have the same rights and powers as any other
Lender and may exercise the same as though it were not the Agent, and the Agent
and its Affiliates may accept deposits from, lend money to and generally engage
in
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any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Agent.
Each Lender agrees (i) to reimburse the Agent, on demand, in the amount of
its pro rata share (based on its Commitment hereunder or, if the Commitments
shall have been terminated, on its Commitment most recently in effect) of any
expenses incurred for the benefit of the Lenders by the Agent, including counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the Lenders, which the Borrower shall be obligated to reimburse under
Section 9.05 but which shall not have been reimbursed by the Borrower and (ii)
to indemnify and hold harmless the Agent and any of its directors, officers,
employees or agents, on demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses; damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against it in
its capacity as the Agent or any of them in any way relating to or arising out
of the Agent's role under this Agreement or any other Loan Document or any
action taken or omitted by it or any of them under this Agreement or any other
Loan Document, to the extent the same shall not have been reimbursed by the
Borrower; provided, however, that no Lender shall be liable to the Agent for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the gross
negligence or willful misconduct of the Agent or any of its directors, officers,
employees or agents.
Each Lender acknowledges that it has, independently and without reliance
upon the Agent or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender also acknowledges that it will, independently
and without reliance upon the Agent or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement or any other Loan Document, any related agreement or any
document furnished hereunder or thereunder.
ARTICLE IX. MISCELLANEOUS
SECTION 9.01. Notices. Notices and other communications provided for herein
-------
shall be in writing and shall be delivered by hand or overnight courier service,
mailed or sent by telex, graphic scanning or other telegraphic communications
equipment of the sending party, as follows:
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(a) if to the Borrower, at 00000 Xxxxxxxx Xxxx, Xxxxxx Xxxxxx,
Xxxxxxxx 00000, Attention of General Counsel, with a copy to the Chief
Financial Officer of the Borrower (Telecopy No. (000) 000-0000);
(b) if to the Agent or the Issuing Bank, to it at The Chase Manhattan
Bank, 000 Xxxx Xxxxxx, 00/xx/ Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of
Xxxx X. Xxxxxxxxxx, (Telecopy No. (000) 000-0000), with a copy to The Chase
Manhattan Bank, One Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention of Loan and Agency Services, (Telecopy No. (212) 522-
5701), The Chase Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention of Xxxxxxx Xxxxx, Esq. (Telecopy No. (000) 000-0000), and
Chase Manhattan International Limited, Trinity Tower, 9 Xxxxxx Xxxx Street,
London, England E19YT, Attention of Xxxxxx Xxxxxxx (Telecopy No. 011 44 71
777 2360); and
(c) if to a Lender, to it at its address (or telecopy number) set
forth in Schedule 2.01 or in the Assignment and Acceptance pursuant to
which such Lender became a party hereto.
Except as otherwise provided in Section 9.15(c), all notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of receipt, in
each case delivered, sent or mailed (properly addressed) to such party as
provided in this Section 9.01 or in accordance with the latest unrevoked
direction from such party given in accordance with this Section 9.01.
SECTION 9.02. Survival of Agreement. All covenants, agreements,
---------------------
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
making by the Lenders of the Loans and the issuance of Letters of Credit by the
Issuing Bank, regardless of any investigation made by the Lenders or the Issuing
Bank or on their behalf, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any Fee or any other
amount payable under this Agreement or any other Loan Document is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not been terminated.
SECTION 9.03. Binding Effect. This Agreement shall become effective when it
--------------
shall have been executed by the Borrower and the Agent and when the Agent shall
have received copies hereof which, when taken together, bear the signatures of
each Lender, and thereafter shall be binding upon and inure to the
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benefit of the Borrower, the Agent and each Lender and their respective
successors and assigns, except that the Borrower may not assign or delegate its
rights or obligations hereunder or any interest herein without the prior consent
of all the Lenders.
SECTION 9.04. Successors and Assigns.
----------------------
(a) Whenever in this Agreement any of the parties hereto is referred
to, such reference shall be deemed to include the successors and assigns of
such party; and all covenants, promises and agreements by or on behalf of
the Borrower, the Agent, the Issuing Bank or the Lenders that are contained
in this Agreement shall bind and inure to the benefit of their respective
successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion
of its interests, rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it);
provided, however, that (i) except in the case of an assignment to a Lender
or a Lender Affiliate, the Borrower (unless an Event of Default has
occurred and is continuing, in which case the Borrower's consent to such
assignment shall not be required) and the Agent must give their prior
written consent to such assignment (which consent shall not be unreasonably
withheld), (ii) except in the case of an assignment to a Lender or a Lender
Affiliate or an assignment of all of a Lender's Commitment, the amount of
the Commitment of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to
such assignment is delivered to the Agent) shall not be less than
$5,000,000 and the amount of the Commitment of such Lender remaining after
such assignment shall not be less than $5,000,000 or shall be zero, (iii)
the parties to each such assignment shall execute and deliver to the Agent
an Assignment and Acceptance, together with a processing and recordation
fee of $3,500 and (iv) the assignee, if it shall not be a Lender, shall
deliver to the Agent an Administrative Questionnaire. Upon acceptance and
recording pursuant to Section 9.04(e), from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be
at least five Business Days after the execution thereof, (A) the assignee
thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations
of a Lender under this Agreement and (B) the assigning Lender thereunder
shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all or the
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remaining portion of an assigning Lenders rights and obligations under this
Agreement, such Lender shall cease to be a party hereto (but shall continue
to be entitled to the benefits of Sections 2.13, 2.15, 2.19 and 9.05, as
well as to any Fees accrued for its account hereunder and not yet paid)).
If the consent of the Borrower is required pursuant to this Section 9.04,
and the Borrower does not respond to the Agent's request for consent within
five (5) Business Days of such request, the consent shall be deemed given.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as
follows: (i) such assigning Lender warrants that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of
any adverse claim and that its Commitment, and the outstanding balances of
its Loans, in each case without giving effect to assignments thereof which
have not become effective, are as set forth in such Assignment and
Acceptance, (ii) except as set forth in (i) above, such assigning Lender
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 the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, any
other Loan Document or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of its
obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
Assignment and Acceptance; (iv) such assignee confirms that it has received
a copy of this Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.04 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; (v) such
assignee will independently and without reliance upon the Agent, such
assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement;
(vi) such assignee appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Agent by the terns hereof, together with such powers as
are reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all
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the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(d) The Agent shall maintain at one of its offices a copy of each
Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment
of, and principal amount of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive in the absence of manifest error and the
Borrower, the Agent, the Issuing Bank and the Lenders may treat each person
whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower, the Issuing Bank and any Lender,
at any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee together with an
Administrative Questionnaire completed in respect of the assignee (unless
the assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in Section 9.04(b) and, if required, the
written consent of the Borrower, the Issuing Bank and the Agent to such
assignment, the Agent shall (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and (iii) give
prompt notice thereof to the Lenders and the Issuing Bank.
(f) Each Lender may without the consent of or notice to the Borrower,
the Issuing Bank or the Agent sell participations to one or more banks or
other entities in all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing
to it); provided, however, that (i) such Lender's obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, (iii) the participating banks or other entities shall be
entitled to the benefit of the cost protection provisions contained in
Sections 2.13, 2.15 and 2.19 to the same extent as if they were Lenders but
not in excess of those cost protections to which the Lender from which it
purchased its participation would be entitled to under Sections 2.13, 2.15
and 2.19 and (iv) the Borrower, the Agent, the Issuing Bank and the other
Lenders shall continue to deal solely and directly with such Lender (and
shall not be required to deal with any participating bank or other entity,
notwithstanding any other provision contained herein) in connection with
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such Lender's rights and obligations under this Agreement, and such Lender
shall retain the sole right to enforce the obligations of the Borrower
relating to the Loans or L/C Disbursements and to approve any amendment,
modification or waiver of any provision of this Agreement (other than
amendments, modifications or waivers decreasing any fees payable hereunder,
increasing the Commitment of such Lender or decreasing the amount of
principal of or the rate at which interest is payable on the Loans of such
Lender, extending any scheduled principal payment date or date fixed for
the payment of interest on the Loans of such Lender or releasing any
Subsidiary Loan Party from its Guarantee under the Guarantee Agreement
(except as expressly provided in the Guarantee Agreement) or limiting any
Subsidiary Loan Party's liability in respect of its Guarantee).
(g) Any Lender or participant may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section 9.04, disclose to the assignee or participant or proposed assignee
or participant any information relating to the Borrower furnished to such
Lender by or on behalf of the Borrower; provided, however, that, prior to
any such disclosure of information designated by the Borrower as
confidential, each such assignee or participant or proposed assignee or
participant shall execute an agreement whereby such assignee or participant
shall agree to preserve the confidentiality of such confidential
information (subject to those exceptions set forth in Section 9.16). It is
understood that confidential information relating to the Borrower would not
ordinarily be provided in connection with assignments or participations of
Competitive Loans.
(h) Any Lender may at any time assign all or any portion of its
rights under this Agreement to a Federal Reserve Bank; provided, however,
that no such assignment shall release a Lender from any of its obligations
hereunder.
(i) Any Lender (each, a "Designating Lender") may at any time
designate one Designated Bank to fund Competitive Loans on behalf of such
Designating Lender subject to the terms of this Section 9.04(i) and the
provisions in 9.04(b) and (f) shall not apply to such designation. No
Lender may designate more than one (1) Designated Bank. The parties to each
such designation shall execute and deliver to the Agent for its acceptance
a Designation Agreement. Upon such receipt of an appropriately completed
Designation Agreement executed by a Designating Lender and a designee
representing that it is a Designated Bank, the Agent will accept such
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Designation Agreement and will give prompt notice thereof to the Borrower,
whereupon, (i) the Borrower shall execute and deliver to the Designating
Bank a Designated Bank Note payable to the order of the Designated Bank,
(ii) from and after the effective date specified in the Designation
Agreement, the Designated Bank shall become a party to this Agreement with
a right to make Competitive Loans on behalf of its Designating Lender
pursuant to Section 2.03 after the Borrower has accepted a Competitive Loan
(or portion thereof) of such Designating Lender, and (iii) the Designated
Bank shall not be required to make payments with respect to any obligations
in this Agreement except to the extent of excess cash flow of such
Designated Bank which is not otherwise required to repay obligations of
such Designated Bank which are then due and payable; provided, however,
that regardless of such designation and assumption by the Designated Bank,
the Designating Lender shall be and remain obligated to the Borrower, the
Agent and the other Lenders for each and every of the obligations of the
Designating Lender and its related Designated Bank with respect to this
Agreement, including, without limitation, any indemnification obligations
hereunder and any sums otherwise payable to the Borrower by the Designated
Bank. Each Designating Lender shall serve as the administrative agent of
the Designated Bank and shall on behalf of, and to the exclusion of, the
Designated Bank: (i) receive any and all payments made for the benefit of
the Designated Bank and (ii) give and receive all communications and
notices and take all actions hereunder, including, without limitation,
votes, approvals, waivers, consents and amendments under or relating to
this Agreement and the other Loan Documents. Any such notice,
communication, vote, approval, waiver, consent or amendment shall be signed
by the Designating Lender as administrative agent for the Designated Bank
and shall not be signed by the Designated Bank on its own behalf but shall
be binding on the Designated Bank to the same extent as if actually signed
by the Designated Bank. The Borrower, the Agent and Lenders may rely
thereon without any requirement that the Designated Bank sign or
acknowledge the same. No Designated Bank may assign or transfer all or any
portion of its interest hereunder or under any other Loan Document, other
than assignments to the Designating Lender which originally designated such
Designated Bank.
SECTION 9.05. Expenses; Indemnity. (a) The Borrower agrees to pay all
-------------------
reasonable out-of-pocket expenses incurred by each of the Agent, the Issuing
Bank, X.X. Xxxxxx Securities Inc. and their Affiliates in connection with the
preparation of this Agreement and the other Loan Documents and the syndication
of the facilities provided for herein or in connection with any amendments,
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modifications or waivers of the provisions hereof or thereof (whether or not the
transactions hereby contemplated shall be consummated) or incurred by the Agent
or any Lender in connection with the enforcement or protection of their rights
(as such rights may relate to the Borrower or any Subsidiary) in connection with
this Agreement and the other Loan Documents or in connection with the Loans made
or Letters of Credit issued hereunder, including the reasonable fees and
disbursements of counsel for the Agent, and, in connection with any "work-out"
or any enforcement or protection of the rights of the Lenders or the Agent
hereunder, any other counsel for the Agent and counsel for any Lender, including
the allocated costs of in-house counsel.
(b) The Borrower agrees to indemnify the Agent, each Lender, and the
Issuing Bank and their respective directors, officers, employees, agents and
Affiliates (each such person being called an "Indemnitee") against, and to hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities,
obligations, actions or causes of action brought by a third party, settlement
payments and related expenses, including reasonable counsel fees and expenses,
incurred, suffered, sustained or required to be paid by or asserted against any
Indemnitee by reason of or resulting from or in connection with any claim,
litigation, investigation or proceeding (regardless of whether any Indemnitee is
a party thereto) in any way related to (i) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties thereto of their respective obligations
thereunder or the consummation of the Transactions, (ii) the use of the proceeds
of the Loans or issuance of Letters of Credit; provided, however, that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee.
Promptly after receipt by an Indemnitee of notice of any complaint or the
commencement of any action or proceeding with respect to which indemnification
is being sought hereunder, such person shall notify the Borrower of such
complaint or of the commencement of such action or proceeding, but failure so to
notify the Borrower will relieve the Borrower from any liability which the
Borrower may have hereunder only if and to the extent that such failure results
in the forfeiture by the Borrower of substantial rights and defenses, and shall
not in any event relieve the Borrower from any other obligation or liability
that the Borrower may have to any Indemnitee otherwise than under this
Agreement. If the Borrower so elects or is requested by such Indemnitee, the
Borrower shall assume the defense of such action or proceeding, including the
employment of counsel reasonably satisfactory to the Indemnitee and the payment
of the reasonable fees and disbursements of such counsel. In the event, however,
such Indemnitee reasonably determines in
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its judgment that having common counsel would present such counsel with a
conflict of interest or if the defendant in, or targets of, any such action or
proceeding include both the Indemnitee and the Borrower, and such Indemnitee
reasonably concludes that there may be legal defenses available to it or other
Indemnitees that are different from or in addition to those available to the
Borrower or if the Borrower fails to assume the defense of the action or
proceeding or to employ counsel reasonably satisfactory to such Indemnitee, in
either case in a timely manner, then the Indemnitee may employ separate counsel
to represent or defend it in any such action or proceeding and the Borrower
shall pay the reasonable fees and disbursements of such counsel. In any action
or proceeding the defense of which the Borrower assumes, the Indemnitee shall
have the right to participate in such litigation and to retain its own counsel
at the Indemnitee's own expense. The Borrower further agrees that it shall not,
without the prior written consent of the Indemnitee, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim, action,
suit or proceeding in respect of which indemnification may be sought hereunder
(whether or not an Indemnitee is an actual or potential party to such claim,
action, suit or proceeding) unless such settlement, compromise or consent
includes (i) an unconditional release of each Indemnitee hereunder from all
liability arising out of such claim, action, suit or proceeding or (ii) a
covenant not to xxx each Indemnitee, or another similar alternative which is
consented to by each Indemnitee party to such claim, action, suit or proceeding,
which covenant not to xxx or other approved alternative has the effect of an
unconditional release of each Indemnitee hereunder from all liability arising
out of such claim, action, suit or proceeding.
(c) The provisions of this Section shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of any Letter of Credit, the invalidity or
unenforceability of any term or provision of this Agreement or any other Loan
Document, or any investigation made by or on behalf of the Agent or any Lender
or any Issuing Bank. All amounts due under this Section shall be payable on
written demand therefor.
SECTION 9.06. Right of Setoff. If an Event of Default shall have occurred
---------------
and be continuing, each Lender is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, but
excluding trust accounts) at any time held and other indebtedness at any time
owing by such Lender to or for the credit or the account of the Borrower against
any of and all the Obligations held by such Lender which are then due and owing,
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irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have (it being assumed
for purposes of this Section that such Lender shall convert any amount so setoff
into the relevant currency on the date of such setoff).
SECTION 9.07. Applicable Law. THIS AGREEMENT SHALL BE CONSTRUED IN
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ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ITS CONFLICTS OF LAWS PRINCIPLES OR PROVISIONS. EACH LETTER OF
CREDIT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAWS
OR RULES DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO SUCH LAWS OR RULES ARE
DESIGNATED, THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993
REVISION), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 500 (THE "UNIFORM
CUSTOMS") AND, AS TO MATTERS NOT GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF
THE STATE OF NEW YORK.
SECTION 9.08. Waivers; Amendment. (a) No failure or delay of the Agent or
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any Lender or any Issuing Bank in exercising any power or right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Agent, the
Issuing Bank and the Lenders hereunder and under the other Loan Documents are
cumulative and are not exclusive of any rights or remedies which they would
otherwise have. No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Borrower therefrom shall in any
event be effective unless the same shall be permitted by Section 9.08(b), and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given. No notice or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances.
(b) Neither this Agreement nor any other Loan Document nor any provision
hereof or thereof may be waived, amended or modified except, in the case of this
Agreement, pursuant to an agreement or agreements in writing entered into by the
Borrower and the Required Lenders or, in the case of any other Loan Document,
pursuant to an agreement or agreements in writing entered into by the Agent and
the Loan Party or Loan Parties that are parties thereto, in each case with the
consent of the Required Lenders; provided, however,
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that no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or any scheduled principal payment date or date for the payment of
any interest on any Loan or any date for reimbursement of an L/C Disbursement,
or Fees, or waive or excuse any such payment or any part thereof, or decrease
the rate of interest on any Loan or L/C Disbursement, without the prior written
consent of each Lender affected thereby, (ii) increase the Commitment or change
the Facility Fees of any Lender without the prior written consent of such
Lender, (iii) release any Subsidiary Loan Party from its Guarantee under the
Guarantee Agreement (except as permitted by Section 5.09(b) or as expressly
provided in the Guarantee Agreement) or limit any Subsidiary Loan Party's
liability in respect of its Guarantee, without the written consent of each
Lender, or (iv) amend or modify the provisions of Section 2.16, the provisions
of this Section, the definition of the "Required Lenders" or the provisions of
Section 9.03, without the prior written consent of each affected Lender;
provided further that no such agreement shall amend, modify or otherwise affect
the rights or duties of the Agent or any Issuing Bank hereunder without the
prior written consent of the Agent or such Issuing Bank.
(c) Notwithstanding the foregoing, no amendment, waiver or consent shall,
unless in writing and signed by the Designating Lender on behalf of its
Designated Bank affected thereby, (a) subject such Designated Bank to any
additional obligations, (b) reduce the principal of, interest on, or other
amounts due with respect to, the Designated Bank Note made payable to such
Designated Bank, or (c) postpone any date fixed for any payment of principal of,
or interest on, or other amounts due with respect to, the Designated Bank Note
made payable to the Designated Bank.
SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to
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the contrary, if at any time the applicable interest rate on any Loan or
participation in any L/C Disbursement, together with all fees and charges which
are treated as interest or such Loan or participation in any L/C Disbursement
under applicable law (collectively the "Charges"), as provided for herein or in
any other document executed in connection herewith, or otherwise contracted for,
charged, received, taken or reserved by any Lender, shall exceed the maximum
lawful rate (the "Maximum Rate") which may be contracted for, charged, taken,
received or reserved by such Lender in accordance with applicable law, together
with all Charges payable to such Lender, shall be limited to the Maximum Rate.
SECTION 9.10. Entire Agreement. This Agreement and the other Loan Documents
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and the letter agreement referred to in Section 2.06(b) constitute the entire
contract between the parties relative to the subject matter hereof. Any previous
agreement among the parties with respect to the subject matter hereof is
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superseded by this Agreement and the other Loan Documents. Nothing in this
Agreement or in the other Loan Documents, expressed or implied, is intended to
confer upon any party other than the parties hereto and thereto any rights,
remedies, obligations or liabilities under or by reason of this Agreement or the
other Loan Documents.
SECTION 9.11. Waiver of Jury Trial; Punitive Damages. Each party hereto
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hereby waives, to the fullest extent permitted by applicable law, (a) any right
it may have to a trial by jury in respect of any litigation directly or
indirectly arising out of, under or in connection with this Agreement or any of
the other Loan Documents and (b) any claims for punitive damages (to the extent
such claims arise from the use of proceeds of the Loans for the purpose of
acquisitions). Each party hereto (i) certifies that no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce the foregoing
waiver and (ii) acknowledges that it and the other parties hereto have been
induced to enter into this Agreement and the other Loan Documents, as
applicable, by, among other things, the mutual waivers and certifications in
this Section.
SECTION 9.12. Severability. In the event any one or more of the provisions
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contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.
SECTION 9.13. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one contract, and shall become effective as
provided in Section 9.03.
SECTION 9.14. Headings. Article and Section headings and the Table of
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Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 9.15. Jurisdiction; Consent to Service of Process; Judgment
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Currency. (a) Each of the Borrower, the Lenders, the Agent and the Issuing Bank
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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
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from any thereof, in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, 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 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 the Agent, any
Issuing Bank, or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against the Borrower or
its properties in the courts of any jurisdiction.
(b) Each of the Borrower, the Lenders, the Agent and the Issuing Bank
hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which 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 the other Loan Documents in any 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.
(c) The Borrower and each other party hereto consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
(d) If for the purpose of obtaining judgment in any court it is necessary
to convert a sum due hereunder in one currency into another currency, the
parties hereto agree, to the fullest extent that they may effectively do so
under applicable law, that the rate of exchange used shall be the spot rate at
which in accordance with normal banking procedures the first currency could be
purchased in New York City with such other currency by the person obtaining such
judgment on the Business Day preceding that on which final judgment is given.
(e) The parties agree, to the fullest extent that they may effectively do
so under applicable law, that the obligations of the Borrower to make payments
in any currency of the principal of and interest on the Loans of the Borrower
and any other amounts due from the Borrower hereunder to the Agent as provided
in Section 2.16 (i) shall not be discharged or satisfied by any tender, or any
recovery pursuant to any judgment (whether or not entered in accordance with
Section 9.15(d)), in any currency other than the relevant currency, except to
the extent that such tender or recovery shall result in the actual receipt by
the Agent at its
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relevant office as provided in Section 2.16 on behalf of the Lenders of the full
amount of the relevant currency expressed to be payable in respect of the
principal of and interest on the Loans and all other amounts due hereunder (it
being assumed for purposes of this clause (i) that the Agent will convert any
amount tendered or recovered into the relevant currency on the date of such
tender or recovery), (ii) shall be enforceable as an alternative or additional
cause of action for the purpose of recovering in the relevant currency the
amount, if any, by which such actual receipt shall fall short of the full amount
of the relevant currency so expressed to be payable and (iii) shall not be
affected by an unrelated judgment being obtained for any other sum due under
this Agreement.
SECTION 9.16. Confidentiality. Unless otherwise agreed to in writing by the
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Borrower, the Issuing Bank, the Agent and each Lender, each of the Borrower, the
Issuing Bank, the Agent and the Lenders hereby agrees to keep all Proprietary
Information (as defined below) confidential and not to disclose or reveal any
Proprietary Information to any person other than the Agent's or such Lender's
directors, officers, employees, Affiliates and agents and to actual or potential
assignees and participants and actual or potential counterparties (or Advisors)
to any swap or derivatives transaction, and then only on a confidential basis;
provided, however, that the Agent, the Issuing Bank or any Lender may disclose
Proprietary Information (a) as required by law, rule, regulation or judicial
process, (b) to its attorneys and accountants, (c) as requested or required by
any state or Federal or foreign authority or examiner regulating banks or
banking or (d) subject to appropriate confidentiality protections for the
benefit of the Borrower, in any legal proceedings between the Agent, the Issuing
Bank or such Lender and the Borrower arising out of this Agreement. For purposes
of this Agreement, the term "Proprietary Information" shall include all
information about the Borrower or any of their Affiliates which has been
furnished by the Borrower or any of its Affiliates, whether furnished before or
after the date hereof, and regardless of the manner in which it is furnished;
provided, however, that proprietary Information does not include information
which (x) is or becomes generally available to the public other than as a result
of a disclosure by the Agent, the Issuing Bank or any Lender not permitted by
this Agreement, (y) was obtained or otherwise became available to the Agent, the
Issuing Bank or any Lender on a nonconfidential basis prior to its disclosure to
the Agent, the Issuing Bank or such Lender by the Borrower or any of its
Affiliates or (z) becomes available to the Agent, the Issuing Bank or any Lender
on a nonconfidential basis from a person other than the Borrower or its
Affiliates who, to the best knowledge of the Agent, the Issuing Bank or such
Lender, as the case may be, is not otherwise bound by a confidentiality
agreement with the Borrower or any of its Affiliates, or is not otherwise
prohibited from transmitting the information to the Agent, the Issuing Bank or
such Lender.
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SECTION 9.17. European Monetary Union. (a) If, as a result of the
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implementation of European monetary union, (i) any currency ceases to be lawful
currency of the nation issuing the same and is replaced by a European common
currency, or (ii) any currency and a European common currency are at the same
time recognized by the central bank or comparable authority of the nation
issuing such currency as lawful currency of such nation and the Agent or the
Required Lenders shall so request in a notice delivered to the Borrower, then
any amount payable hereunder by any party hereto in such currency shall instead
be payable in the European common currency and the amount so payable shall be
determined by translating the amount payable in such currency to such European
common currency at the exchange rate recognized by the European Central Bank for
the purpose of implementing European monetary union. Prior to the occurrence of
the event or events described in clause (i) or (ii) of the preceding sentence,
each amount payable hereunder in any currency will continue to be payable only
in that currency.
(b) The Borrower agrees, at the request of any Lender, to compensate such
Lender for any loss, cost, expense or reduction in return that shall be incurred
or sustained by such Lender as a result of the implementation of European
monetary union and that would not have been incurred or sustained but for the
transactions provided for herein. A certificate of a Lender setting forth in
reasonable detail the calculation for the amount or amounts necessary to
compensate such Lender shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate within ten (10) days after receipt thereof.
(c) The Borrower agrees, at the request of the Required Lenders, at the
time of or at any time following the implementation of European monetary union,
to enter into an agreement amending this Agreement in such manner as the
Required Lenders shall reasonably request in order to reflect the implementation
of such monetary union and to place the parties hereto in the position they
would have been in had such monetary union not been implemented.
SECTION 9.18. No Bankruptcy Proceedings. Each of the Borrower, the Agent,
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and the Lenders hereby agrees that it will not institute against any Designated
Bank or join any other person in instituting against any Designated Bank any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding
under any federal or state bankruptcy or similar law, until the later to occur
of (i) one year and one day after the payment in full of the latest maturing
commercial paper note issued by such Designated Bank and (ii) the Revolving
Maturity Date.
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IN WITNESS WHEREOF, the Borrower, the Agent, the Issuing Bank and the
Lenders have caused this Agreement to be duly executed by their respective
authorized officers as of the day and year first above written.
CHOICE HOTELS INTERNATIONAL, INC.,
By: ______________________________
Name:
Title:
THE CHASE MANHATTAN BANK, individually
and as Issuing Bank and Agent
By: ______________________________
Name:
Title:
FLEET NATIONAL BANK, individually and as
Syndication Agent
By: ______________________________
Name:
Title:
XXXXXXX XXXXX XXXXXX INC., as
Syndication Agent
By: ______________________________
Name:
Title:
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FIRST UNION NATIONAL BANK, individually
and as Documentation Agent
By: ______________________________
Name:
Title:
CITICORP REAL ESTATE, INC.
By: ______________________________
Name:
Title:
ALLFIRST BANK
By: ______________________________
Name:
Title:
CHEVY CHASE BANK FSB
By: ______________________________
Name:
Title:
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THE DAI-ICHI KANGYO BANK, LTD.
By: ______________________________
Name:
Title:
E. SUN COMMERCIAL BANK, LTD.
By: ______________________________
Name:
Title:
FUJI BANK, LIMITED
By: ______________________________
Name:
Title:
SUNTRUST BANK
By: ______________________________
Name:
Title:
