Exhibit 10.19
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FORM OF
CREDIT AGREEMENT
dated as of
[______], 2003
among
MEDCO HEALTH SOLUTIONS, INC.,
as Borrower
THE LENDERS AND ISSUING BANK PARTY HERETO
JPMORGAN CHASE BANK,
as Administrative Agent
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X.X. XXXXXX SECURITIES INC.,
XXXXXXX SACHS CREDIT PARTNERS L.P.
and CITIGROUP GLOBAL MARKETS INC.
as Joint Lead Arrangers and Joint Bookrunners,
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XXXXXXX XXXXX CREDIT PARTNERS L.P.
and CITICORP NORTH AMERICA, INC.
as Co-Syndication Agents
and
BANK ONE, NA
and WACHOVIA BANK, NA
as Co-Documentation Agents
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TABLE OF CONTENTS
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ARTICLE I Definitions 1
SECTION 1.01. Defined Terms ................................................... 1
SECTION 1.02. Classification of Loans and Borrowings .......................... 23
SECTION 1.03. Terms Generally ................................................. 23
SECTION 1.04. Accounting Terms; GAAP .......................................... 23
ARTICLE II The Credits 23
SECTION 2.01. Commitments ..................................................... 23
SECTION 2.02. Loans and Borrowings ............................................ 24
SECTION 2.03. Requests for Revolving Borrowings ............................... 25
SECTION 2.04. Swingline Loans ................................................. 25
SECTION 2.05. Letters of Credit ............................................... 26
SECTION 2.06. Funding of Borrowings ........................................... 30
SECTION 2.07. Interest Elections .............................................. 31
SECTION 2.08. Termination and Reduction of Commitments ........................ 32
SECTION 2.09. Repayment of Loans; Evidence of Debt ............................ 33
SECTION 2.10. Prepayment of Loans ............................................. 34
SECTION 2.11. Fees ............................................................ 36
SECTION 2.12. Interest ........................................................ 37
SECTION 2.13. Alternate Rate of Interest ...................................... 38
SECTION 2.14. Increased Costs ................................................. 38
SECTION 2.15. Break Funding Payments .......................................... 39
SECTION 2.16. Taxes ........................................................... 39
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs ..... 41
SECTION 2.18. Mitigation Obligations; Replacement of Lenders .................. 44
ARTICLE III Representations and Warranties 45
SECTION 3.01. Organization; Powers ............................................ 45
SECTION 3.02. Authorization; Enforceability ................................... 45
SECTION 3.03. Governmental Approvals; No Conflicts; Ranking ................... 45
SECTION 3.04. Financial Condition; No Material Adverse Change ................. 46
SECTION 3.05. Properties; Insurance ........................................... 46
SECTION 3.06. Litigation and Environmental Matters ............................ 47
SECTION 3.07. Compliance with Laws and Agreements ............................. 47
SECTION 3.08. Investment and Holding Company Status ........................... 47
SECTION 3.09. Taxes ........................................................... 47
SECTION 3.10. ERISA ........................................................... 47
SECTION 3.11. Employee Matters ................................................ 48
SECTION 3.12. Transactions and Related Documents .............................. 48
SECTION 3.13. Margin Regulations .............................................. 48
SECTION 3.14. Certain Fees .................................................... 49
SECTION 3.15. Solvency ........................................................ 49
SECTION 3.16. No Burdensome Restrictions ...................................... 49
SECTION 3.17. Disclosure ...................................................... 49
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TABLE OF CONTENTS
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ARTICLE IV Conditions 49
SECTION 4.01. Closing Date .................................................... 49
SECTION 4.02. Each Credit Event ............................................... 51
ARTICLE V Affirmative Covenants 52
SECTION 5.01. Financial Statements; Ratings Change and Other Information ...... 52
SECTION 5.02. Notices of Material Events ...................................... 53
SECTION 5.03. Existence; Conduct of Business .................................. 54
SECTION 5.04. Payment of Obligations .......................................... 54
SECTION 5.05. Maintenance of Properties; Insurance ............................ 54
SECTION 5.06. Books and Records; Inspection Rights ............................ 54
SECTION 5.07. Compliance with Laws and Agreements ............................. 55
SECTION 5.08. Spin-Off ........................................................ 55
SECTION 5.09. Use of Proceeds and Letters of Credit ........................... 55
SECTION 5.10. Additional Collateral ........................................... 55
ARTICLE VI Negative Covenants and Financial Covenants 56
SECTION 6.01. Indebtedness .................................................... 56
SECTION 6.02. Liens ........................................................... 58
SECTION 6.03. Fundamental Changes; Asset Sales ................................ 59
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions ....... 60
SECTION 6.05. Swap Agreements ................................................. 62
SECTION 6.06. Restricted Payments ............................................. 62
SECTION 6.07. Transactions with Affiliates .................................... 63
SECTION 6.08. Restrictive Agreements .......................................... 63
SECTION 6.09. Prepayments or Redemptions of Indebtedness; Amendments to
Related Documents ............................................. 64
SECTION 6.10. Financial Covenants ............................................. 65
ARTICLE VII Events of Default 66
ARTICLE VIII The Administrative Agent 68
ARTICLE IX Miscellaneous 71
SECTION 9.01. Notices ......................................................... 71
SECTION 9.02. Waivers; Amendments ............................................. 72
SECTION 9.03. Expenses; Indemnity; Damage Waiver .............................. 73
SECTION 9.04. Successors and Assigns .......................................... 75
SECTION 9.05. Survival ........................................................ 78
SECTION 9.06. Counterparts; Integration; Effectiveness ........................ 78
SECTION 9.07. Severability .................................................... 79
SECTION 9.08. Governing Law; Jurisdiction; Consent to Service of Process ...... 79
SECTION 9.09. WAIVER OF JURY TRIAL ............................................ 79
SECTION 9.10. Headings ........................................................ 80
SECTION 9.11. Confidentiality ................................................. 80
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TABLE OF CONTENTS
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SECTION 9.12. Interest Rate Limitation ........................................ 81
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TABLE OF CONTENTS
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SCHEDULES:
Schedule 2.01 - Commitments
Schedule 3.01 - Subsidiaries
Schedule 3.12 - Summary of Spin-Off and Notes Offering
Schedule 6.01 - Existing Indebtedness
Schedule 6.02 - Existing Liens
Schedule 6.08 - Existing Restrictions
EXHIBITS:
Exhibit A - Form of Assignment and Assumption
Exhibit B - Form of Certificate of Non-Bank Status
Exhibit C - Form of Borrowing Request
Exhibit D - Form of Swingline Loan Request
Exhibit E - Form of Letter of Credit Request
Exhibit F - Form of Interest Election Request
Exhibit G - 1 Form of Promissory Note for Revolving Loans
Exhibit G - 2 Form of Promissory Note for Term A Loan
Exhibit G - 3 Form of Promissory Note for Term B Loan
Exhibit H - Form of Pledge Agreement
Exhibit I - Form of Opinion of Borrower's Counsel
Exhibit J - Form of Accountant's Certificate
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CREDIT AGREEMENT, dated as of [_______], 2003, among MEDCO HEALTH
SOLUTIONS, INC., a Delaware corporation, as the Borrower, each Lender and
Issuing Bank named on the signature pages hereof and otherwise from time to time
party hereto, JPMORGAN CHASE BANK, as the Administrative Agent, XXXXXXX XXXXX
CREDIT PARTNERS L.P. and CITICORP NORTH AMERICA, INC., as Co-Syndication Agents,
and BANK ONE, NA and WACHOVIA BANK, NA, as Co-Documentation Agents.
WHEREAS, the Borrower has requested that the Lenders and the Issuing
Bank respectively make available to the Borrower, for the purposes specified in
this Agreement, term loans, revolving loans and letters of credit; and
WHEREAS, the Lenders and the Issuing Bank are willing to make
available to the Borrower such term loans, revolving loans and letters of credit
on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, covenants and
agreements set forth herein, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans constituting such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Acquired Business" means (a) any Person substantially all of the
Equity Interests of which are acquired after the date thereof by the Borrower
and/or a Subsidiary of the Borrower or (b) any assets constituting a separately
identifiable business or operating unit or division acquired on or after the
date hereof by the Borrower or a Subsidiary of the Borrower.
"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 Agent" means JPMorgan Chase Bank, in its capacity as
administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affected Lender" has the meaning ascribed to such term in Section
2.13.
"Affiliate" means, 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.
"Agreement" means this Credit Agreement, as the same may at any time
be amended, supplemented or otherwise modified in accordance with the terms
hereof and in effect.
"Alternate Base Rate" means, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Commitment Fee Rate" means, with respect to the Revolving
Credit Commitments, for any period, the applicable percentage per annum equal to
the percentage set forth below determined by reference to the category
containing the lower of (a) the rating applicable to the Facilities from S&P or
(b) the rating applicable to the Facilities from Xxxxx'x, in each case as in
effect from time to time during such period:
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Facilities Ratings Applicable
(S&P or Xxxxx'x) Commitment Fee
Rate
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Category 1: 0.200%
BBB+ or better and Baa1 or better
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Category 2:
BBB or Baa2 0.250%
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Category 3:
BBB- or Baa3 0.325%
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Category 4:
BB+ or Ba1 0.375%
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Category 5:
Worse than or equal to BB or Ba2 0.500%
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provided, that (i) if, at any time, neither S&P nor Xxxxx'x makes available any
rating with respect to the Facilities, the Applicable Commitment Fee Rate shall
be 0.500% and (ii) if the ratings established by S&P or Xxxxx'x for the
Facilities shall be changed (other than as a result of a change in the rating
system of S&P or Xxxxx'x), such change shall be effective as of the date on
which it is first announced by the applicable rating agency, irrespective of
when notice of such change shall have been furnished by the Borrower to the
Agent and the Lenders pursuant to Section 5.01 or otherwise. Each change in the
Applicable Commitment Fee Rate shall apply during the period commencing on the
effective date of such change and ending on the date immediately preceding the
effective date of the next such change. If the rating system of S&P or Xxxxx'x
shall change, or if either such rating agency (including any successor to its
rating agency business) shall cease to be in the business of rating corporate
debt obligations, the Borrower and the Lenders shall negotiate in good faith to
amend this definition to reflect such changed rating system or the
unavailability of ratings from such rating agency (including any successor to
its rating agency business) and, pending the effectiveness of any such
amendment, the Applicable Commitment Fee Rate shall be determined using the S&P
or Xxxxx'x rating, as the case may be, most recently in effect prior to such
change or cessation.
"Applicable Interest Rate Margin" means, with respect to (a) any Term
B Loans comprising (i) ABR Loans, 1.25% per annum and (ii) Eurodollar Loans,
2.25% per annum; and (b) any Revolving Loans or any Term A Loans comprising,
respectively, ABR Loans or
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Eurodollar Loans, for any Interest Period, the applicable percentage per annum
equal to the percentage set forth below, determined by reference to the category
containing the lower of (x) the rating applicable to the Facilities from S&P and
(y) the rating applicable to the Facilities from Xxxxx'x, in each case
corresponding to such ABR Loan or Eurodollar Loan, as in effect on the first day
of such Interest Period:
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Revolving Loans and Term A Loans
Facilities Ratings --------------------------------
(S&P or Xxxxx'x) ABR Loans Eurodollar Loans
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Category 1: 0.25% 1.25%
BBB+ or better and Baa1 or better
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Category 2:
BBB or Baa2 0.50% 1.50%
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Category 3:
BBB- or Baa3 0.75% 1.75%
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Category 4:
BB+ or Ba1 1.00% 2.00%
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Category 5:
BB or Ba2 1.25% 2.25%
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Category 6:
Worse than BB or Ba2 1.75% 2.75%
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provided that (i) if, at any time, the ratio of Consolidated Total Debt to
Consolidated EBITDA is less than 1.5:1, as shown in the most recent certificate
delivered by the Borrower to the Administrative Agent pursuant to Section
5.01(c), the Applicable Interest Rate Margin for any Revolving Loans or Term A
Loans comprising ABR Loans or Eurodollar Loans at such time shall be reduced by
0.25% per annum, with effect from and including the date of delivery of such
certificate to the Administrative Agent, provided, however, that such reduction
shall not apply (x) if Category 5 or Category 6 in the above grid apply in
determining the Applicable Interest Rate Margin at such time or (y) during any
period in which the Borrower is not in compliance with its obligations under
Section 5.01(c)); (ii) if, at any time, neither S&P nor Xxxxx'x makes available
any rating with respect to the Facilities, the Applicable Interest Rate Margin
for any Revolving Loan or Term A Loan comprising ABR Loans or Eurodollar Loans
shall be 1.75% and 2.75%, respectively; and (iii) if the ratings established by
S&P or Xxxxx'x for the Facilities shall be changed (other than as a result of a
change in the rating system of S&P or Xxxxx'x), such change shall be effective
as of the date on which it is first announced by the applicable rating agency,
irrespective of when notice of such change shall have been furnished by the
Borrower to the Administrative Agent and the Lenders pursuant to Section 5.01 or
otherwise. Each change in the Applicable Interest Rate Margin shall apply during
the period commencing on the effective date of such change and ending on the
date immediately preceding the effective date of the next such change. If the
rating system of S&P or Xxxxx'x shall change, or if either such rating agency
(including any successor to its rating agency business) shall cease to be in the
business of rating corporate debt obligations, the Borrower and the Lenders
shall negotiate in good faith to amend this definition to reflect such changed
rating system or the unavailability of ratings from such rating agency
(including any successor to its rating agency business) and, pending the
effectiveness of any such amendment, the Applicable Interest Margin Rate shall
be determined using the S&P or Xxxxx'x rating, as the case may be, most recently
in effect prior to such change or cessation.
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"Applicable Percentage" means, with respect to any Lender's Revolving
Credit Commitment, Term A Loan Commitment or Term B Loan Commitment, the
percentage of the Lenders' total Revolving Credit Commitments, Term A Loan
Commitments or total Term B Loan Commitments, as the case may be, represented by
such Lender's applicable commitment. If the Revolving Credit Commitments, Term A
Loan Commitments or Term B Loan Commitments have terminated or expired, the
Applicable Percentages shall be determined based upon the Revolving Credit
Commitments, Term A Loan Commitments or Term B Loan Commitments, respectively,
most recently in effect, giving effect to any permitted assignments.
"Approved Fund" has the meaning assigned to such term in Section 9.04.
"Asset Sale" means a sale, lease or sub-lease (as lessor or
sublessor), Sale and Leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than the
Borrower or a Subsidiary of the Borrower), in one transaction or a series of
transactions, of all or any part of the Borrower's or any of its Subsidiaries'
businesses, assets or properties of any kind, whether real, personal, or mixed
and whether tangible or intangible, whether now owned or hereafter acquired,
other than inventory (or other assets) sold, transferred or leased in the
ordinary course of business. For purposes of this definition, receipt by
Borrower of insurance or condemnation proceeds in excess of $5,000,000 in
respect of any destroyed or condemned asset shall be deemed to be a sale of such
asset for proceeds.
"Assignment and Assumption" means (a) an assignment and assumption
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative Agent
or (b) any assignment in accordance with Section 2.18.
"Availability Period" means, with respect to the Revolving Credit
Facility, from and including the date hereof to, but excluding, the earlier of
the Maturity Date for the Revolving Credit Facility and the date of termination
of the Revolving Credit Commitments pursuant to the terms hereof.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" means Medco Health Solutions, Inc., a Delaware corporation.
"Borrowing" means an advance of (a) Revolving Loans of the same Type,
made, converted or continued on the same date and, in the case of Eurodollar
Loans, as to which a single Interest Period is in effect, (b) Term A Loans, (c)
Term B Loans or (d) a Swingline Loan, as applicable.
"Borrowing Request" means a request by the Borrower for a Revolving
Borrowing in accordance with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided, that, when used in connection with a Eurodollar
Loan, the term "Business Day" shall
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also exclude any day on which banks are not open for dealings in dollar deposits
in the London interbank market.
"Capital Lease" means 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 the Borrower and its Subsidiaries under GAAP.
"Capital Lease Obligations" means the obligations of the Borrower or
its Subsidiaries to pay rent or other amounts under any Capital Lease, and the
amount of such obligations shall be the capitalized amount thereof determined in
accordance with GAAP.
"Cash Management Obligation" means, any direct or indirect liability,
contingent or otherwise, of the Borrower or its Subsidiaries in respect of cash
management services (including treasury, depository, overdraft, credit or debit
card, electronic funds transfer and other cash management arrangements) provided
by the Administrative Agent, any Lender or any Affiliate of any of them,
including obligations for the payment of fees, interest, charges, expenses,
attorneys' fees and disbursements in connection therewith.
"Certificate of Non-Bank Status" means a certificate substantially in
the form of Exhibit B.
"Change in Control" means (a) (i) at any time prior to consummation of
the Spin-Off, Merck failing to own, beneficially and of record, directly 100% of
the aggregate issued and outstanding Equity Interests of the Borrower and (ii)
at any time following consummation of the Spin-Off, the acquisition of
ownership, directly or indirectly, beneficially or of record, by any Person or
group (each within the meaning of the Securities Exchange Act of 1934 and the
rules of the SEC thereunder as in effect on the date hereof) not an Affiliate of
the Borrower or Merck of Equity Interests representing more than 30% of the
aggregate ordinary voting power represented by the issued and outstanding Equity
Interests of the Borrower, (b) during any period of up to 12 consecutive months
commencing after the date hereof, the occupation of a majority of the seats
(other than vacant seats) on the board of directors of the Borrower by Persons
who were neither nominated nor appointed by a vote of a majority or more of the
members of the Borrower's board of directors who were either in office at the
beginning of such 12 month period or were so nominated or appointed, or (c) the
occurrence of a "Change of Control" as defined in the Notes Indenture.
"Change in Law" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.14(b), by any lending office of such Lender
or by such Lender's or the Issuing Bank's holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans constituting such Borrowing, are Revolving
Loans, Term A Loans, Term B Loans or Swingline Loans.
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"CLO" has the meaning assigned to such term in Section 9.04.
"Closing Date" means the first date on which each of the conditions
set forth in Section 4.01 have been satisfied (or waived in accordance with
Section 9.02).
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" means all assets of the Borrower or any other Person that
are subject to a Lien created by the Collateral Documents.
"Collateral Documents" means the Pledge Agreement and any other
document executed and delivered by the Borrower granting a Lien on any of its
property to secure payment of the Secured Obligations.
"Commitment" means any of the Revolving Credit Commitments, Term A
Loan Commitments and Term B Loan Commitments.
"Consolidated Capital Expenditures" means, for any period, the
aggregate of all expenditures by the Borrower and its Subsidiaries for the
acquisition or leasing (pursuant to a Capital Lease) of fixed or capital assets
or additions to equipment (including replacements, capitalized repairs and
improvements during such period) capitalized in conformity with GAAP on the
consolidated balance sheet of the Borrower and its Subsidiaries.
"Consolidated Current Assets" means, at the date of determination, the
aggregate amount of the assets classified as current assets in conformity with
GAAP (other than cash and Permitted Investments) as reflected on the
consolidated balance sheet of the Borrower and its Subsidiaries as of such date.
"Consolidated Current Liabilities" means, at the date of
determination, the aggregate amount of the liabilities classified as current
liabilities in conformity with GAAP as reflected on the consolidated balance
sheet of the Borrower and its Subsidiaries as of such date, excluding the
current portion of long-term indebtedness and notes payable reflected on such
balance sheet.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus (A) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (1) the aggregate amount of
Consolidated Interest Expense for such period, (2) the aggregate provision for
federal, state, local or foreign taxes based on income or profits for such
period, (3) all amounts attributable to depreciation, amortization (including
amortization of goodwill or other intangible assets) or impairment of goodwill
or other intangible assets for such period, (4) any extraordinary or
non-recurring non-cash charges for such period (provided, however, that cash
expenditures in respect of charges added back pursuant to this clause (4) shall
be deducted in determining Consolidated EBITDA for the period during which such
expenditures are made), (5) the aggregate amount of all non-cash compensation
charges incurred during such period arising from the grant of or the issuance of
stock, stock options or other equity awards, and (6) the aggregate amount of any
extraordinary losses (less extraordinary gains) plus any loss (less any gains)
realized by the Borrower or any of its
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Subsidiaries in connection with an Asset Sale and minus (B) any extraordinary or
non-recurring non-cash gains for such period.
"Consolidated Fixed Charges" means, for any period, the sum of,
without duplication, (A) Consolidated Interest Expense for such period and (B)
the scheduled principal amortization payments made on all Indebtedness
(excluding (i) payments pursuant to a revolving credit facility prior to, or
pursuant to, the occurrence of the scheduled termination date thereunder and
(ii) payments pursuant to the scheduled termination of the Securitization) by
the Borrower and its Subsidiaries during such period.
"Consolidated Interest Expense" means, for any period, the total
interest expense, whether paid or accrued and whether or not capitalized,
(including, without limitation, amortization of debt issuance costs and original
issue discount, interest capitalized during construction, non-cash interest
payments, the interest component of any deferred payment obligations, the
imputed interest expense of all Capital Lease Obligations, all commissions,
discounts and other fees and charges owned with respect to letters of credit and
bankers' acceptances and net costs (excluding any notional principal amount) in
respect of Hedging Obligations constituting interest rate swaps, collars, caps
or other arrangements requiring payments contingent upon interest rates of the
Borrower and its consolidated Subsidiaries), net of interest income in respect
of any of the foregoing, determined on a consolidated basis for such period.
"Consolidated Net Income" means, for any period, the amount of net
income reflected on the consolidated statement of income of the Borrower and its
Subsidiaries for such period in conformity with GAAP.
"Consolidated Net Tangible Assets" means, as of the date of
determination, the aggregate amount of all assets reflected on the consolidated
balance sheet of the Borrower and its Subsidiaries as of such date in conformity
with GAAP less, to the extent reflected on such balance sheet: (A) Consolidated
Current Liabilities; (B) intangibles; and (C) goodwill, including any amounts
(however designated on the balance sheet) representing the cost of acquisitions
of Subsidiaries in excess of underlying tangible assets.
"Consolidated Total Debt" means, as of the date of determination, the
aggregate amount of Indebtedness reflected on the consolidated balance sheet of
the Borrower and its Subsidiaries as of such date in conformity with GAAP, plus,
without duplication, "synthetic leases", letters of credit (but only to the
extent drawn and not reimbursed) and the aggregate amount advanced (whether in
the form of capital or principal, including any capitalized yield thereon) which
is outstanding under the Securitization.
"Consolidated Working Capital" means, at any date, the amount by which
Consolidated Current Assets exceeds Consolidated Current Liabilities at such
date.
"Control" means 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 ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
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"Co-Syndication Agents" means Xxxxxxx Xxxxx Credit Partners L.P. and
Citicorp North America, Inc.
"Credit Event" has the meaning assigned to such term in Section 4.02.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"dollars" or "$" refers to lawful money of the United States of
America.
"Domestic Subsidiary" means any Subsidiary organized under the laws of
any state of the United States of America or the District of Columbia.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions or binding agreements
issued, promulgated or entered into by any Governmental Authority, relating in
any way to the environment, preservation or reclamation of natural resources,
the management, release or threatened release of any Hazardous Material or to
health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Interests" means, with respect to any Person, shares of
capital stock, partnership interests, membership interests in a limited
liability company, beneficial interests in a trust or other equity ownership
interests issued by such Person, and any warrants, options or other rights
entitling the holder thereof to purchase or acquire any such equity interest.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of
-8-
ERISA with respect to the termination of any Plan; (e) the receipt by
the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or Plans or to appoint a
trustee to administer any Plan; (f) the incurrence by the Borrower or any of its
ERISA Affiliates of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans constituting such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
VII.
"Excess Cash Flow" means, for any period, (a) Consolidated EBITDA for
such period plus (b) the excess, if any, of Consolidated Working Capital at the
beginning of such period over Consolidated Working Capital at the end of such
period minus (c) the sum of (without duplication) (i) cash principal payments on
the Loans during such period (whether scheduled, mandatory or optional (but, in
the case of optional prepayments of Revolving Loans, only to the extent that the
Revolving Credit Commitments are permanently reduced by the amount of such
payments) and additionally including for fiscal year 2004 any optional principal
prepayments of the Term Loans made during fiscal year 2003, (ii) scheduled cash
principal payments made by the Borrower or any of its Subsidiaries during such
period on other Indebtedness to the extent such other Indebtedness and payments
are permitted by this Agreement, (iii) scheduled payments of Capital Lease
Obligations made by the Borrower or any of its Subsidiaries to the extent such
Capital Lease Obligations and payments thereof are permitted by this Agreement,
(iv) Consolidated Capital Expenditures made by the Borrower or any of its
Subsidiaries during such period to the extent permitted by this Agreement, (v)
the excess, if any, of the Consolidated Working Capital at the end of such
period over the Consolidated Working Capital at the beginning of such period,
(vi) the aggregate amount of all taxes of the Borrower and its Subsidiaries to
the extent paid in cash during such period, and (vii) Consolidated Interest
Expense of the Borrower and its Subsidiaries to the extent paid in cash during
such period.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income or profits by reason of any
connection between, as applicable, the Administrative Agent or such Lender or
any other party entitled to receive payment hereunder and the relevant taxing
jurisdiction, including, without limitation, a connection arising from such
other Person being or having been a citizen, domiciliary, or resident of such
jurisdiction, being organized in such jurisdiction, or having or having had a
permanent establishment, branch or other fixed place of business therein, but
excluding a connection arising solely from such Person having executed,
delivered, performed its obligations or received any payment under this
Agreement, (b) any Taxes imposed by reason of the Administrative Agent, the
Lender or such other party treated as a "conduit" under U.S. Treasury Regulation
Section 1.881-3 or applicable successor provision, (c) any branch profits taxes
imposed by the United States of America or any similar tax imposed by any other
jurisdiction in which the Borrower is located and (d) in the case of a Foreign
Lender
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(other than an assignee pursuant to a request by the Borrower under
Section 2.18(b)), any Tax that is imposed on amounts payable to such Foreign
Lender at the time such Foreign Lender becomes a party to this Agreement (or
designates a new lending office) or is attributable to such Foreign Lender's
failure to comply with Section 2.16(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts from the
Borrower with respect to such Tax pursuant to Section 2.16(a).
"Executive Officer" means the chief executive officer, the chief
financial officer, the general counsel, the chief accounting officer, the
controller, the treasurer or any other "officer" (as defined in Rule 16a-1 of
the Securities Exchange Act of 1934, as amended) of the Borrower.
"Facilities" means the Revolving Credit Facility and the Term Loans.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) 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 that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Fee Letters" means, collectively, each letter agreement entered into
by Borrower with any of the Administrative Agent and the Joint Lead Arrangers
with respect to the payment of fees by the Borrower in connection with the
Facilities.
"Financial Officer" means the chief financial officer, the principal
accounting officer, the treasurer and the controller of the Borrower.
"Foreign Lender" means any Lender that is not a "United States person"
(as such term is defined in Section 7701(a)(3) of the Code.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of government.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing any
Indebtedness or other obligation of any other Person (the "primary obligor") in
any manner, whether directly or indirectly, and including any obligation of the
guarantor, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or other obligation, or
any security for such Indebtedness or other obligation, (b) to purchase or lease
property, securities or
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services primarily for the purpose of assuring the owner of such Indebtedness or
other obligation of the payment thereof, (c) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation or (d) as an account party in respect of any letter of credit or
letter of guarantee issued to support such Indebtedness or other obligation;
provided, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business.
"Hazardous Materials" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Contract" means any Swap Agreement designed to alter the
risk exposure of the Borrower or any Subsidiary with respect in interest rates,
currency values, equity prices or commodity prices.
"Hedging Creditor" means any Lender or any Affiliate of any
Lender from time to time party to one or more Hedging Contracts with the
Borrower or any of its Subsidiaries (even if any such Lender for any reason
ceases after the execution of such agreement to be a Lender hereunder), and its
successors and assigns, and "Hedging Creditors" means any two or more of them,
collectively.
"Hedging Obligations" of any Person means all obligations
(including, without limitation, any amounts which accrue after the commencement
of any bankruptcy or insolvency proceeding with respect to such Person, whether
or not allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) of such Person in respect of any Hedging Contract, excluding any
amounts which such Person is entitled to set-off against its obligations under
applicable law.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person (other than customary
reservations or retentions of title under agreements with suppliers entered into
in the ordinary course of business), (d) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding
current accounts payable, rebates to customers and vendors and other accrued
expenses incurred in the ordinary course of business), (e) all Indebtedness of
others secured by (or for which the holder of such Indebtedness 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 Indebtedness secured thereby has
been assumed; provided, that the amount of any Indebtedness of others that
constitutes Indebtedness of such Person solely by reason of this clause (e)
shall, in the event that such Indebtedness is limited recourse to such property
(without recourse to such Person), for purposes of this Agreement, not exceed
the greater of the book value or the fair market value of such property subject
to such Lien, (f) all Guarantees by such Person of Indebtedness of others, (g)
all Capital Lease Obligations of such Person, (h) all obligations, contingent or
otherwise, of such Person as an account party in respect of the face amount of
letters of credit and letters of guarantee, (i) all obligations, contingent or
-11-
otherwise, of such Person in respect of the face amount of bankers' acceptances
and (j) Off-Balance Sheet Liabilities; provided, that Indebtedness shall not
include deferred tax liabilities, employee and retiree benefit obligations or
endorsements for collection or deposit in the ordinary course of business. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes or
Other Taxes.
"Indemnitee" has the meaning assigned to such term in Section
9.03(b).
"Information Memorandum" means the Information Memorandum dated
June, 2003 prepared with respect to the Borrower and the Transactions.
"Insurance Subsidiary" means each Subsidiary of the Borrower that
engages primarily in insurance-related activities that are connected with the
business of the Borrower or one or more of its Subsidiaries.
"Interest Election Request" means a request by the Borrower to
convert or continue a Borrowing in accordance with Section 2.07.
"Interest Payment Date" means (a) with respect to any ABR Loan
(other than a Swingline Loan), the last day of each March, June, September and
December and (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in
the case of a Eurodollar Borrowing with an Interest Period of more than three
months' duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months' duration after the first day of such
Interest Period and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.
"Interest Period" means, with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter (or nine or twelve months thereafter, unless a Lender has
notified the Administrative Agent that Eurodollar Borrowings for such period is
unavailable from such Lender) as the Borrower may elect; provided, that (i) 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 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 and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Borrowing initially shall be the date on which such Borrowing is made and,
in the case of a Revolving Borrowing, thereafter shall be the effective date of
the most recent conversion or continuation of such Borrowing.
"Investment" has the meaning assigned to such term in Section
6.04.
-12-
"Issuing Bank" means JPMorgan Chase Bank, in its capacity as the
issuer of Letters of Credit hereunder, and its successors in such capacity as
provided in Section 2.05(i). The Issuing Bank may, in its discretion, arrange
for one or more Letters of Credit to be issued by Affiliates of the Issuing
Bank, in which case the term "Issuing Bank" shall include any such Affiliate
with respect to Letters of Credit issued by such Affiliate.
"Joint Lead Arrangers" means X.X. Xxxxxx Securities, Xxxxxxx
Sachs Credit Partners L.P. and Citigroup Global Markets Inc.
"L/C Disbursement" means a payment made by the Issuing Bank
pursuant to a Letter of Credit.
"L/C Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all L/C Disbursements that have not yet been reimbursed by
or on behalf of the Borrower at such time. The L/C Exposure of any Lender at any
time shall be its Applicable Percentage of the Revolving Credit Commitments
multiplied by the total L/C Exposure at such time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption. Unless the context otherwise requires, the term
"Lenders" includes each Swingline Lender.
"Letter of Credit" means any letter of credit issued pursuant to
this Agreement.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for
any Interest Period, the rate appearing on Page 3750 of the Dow Xxxxx Market
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
reasonably determined by the Administrative Agent from time to time for purposes
of providing quotations of interest rates applicable to dollar deposits 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 dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the "LIBO Rate"
with respect to such Eurodollar Borrowing for such Interest Period shall be the
rate (rounded upwards, if necessary, to the next 1/100 of 1%) at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed
of trust, lien, pledge, hypothecation, encumbrance, charge or security interest
in, on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities. Solely for the avoidance of doubt, the filing of a Uniform
Commercial Code financing statement that is a protective lease filing in respect
of an operating lease that does not constitute a security interest in the leased
property or
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otherwise give rise to a Lien does not constitute a Lien solely on account of
being filed in a public office.
"Loan" means any loan made by a Lender to the Borrower pursuant
to this Agreement.
"Loan Documents" means, collectively, this Agreement, each
Promissory Note, the Fee Letters, each Collateral Document and each certificate,
agreement or document executed by the Borrower and delivered to the
Administrative Agent or any Lender in connection with or pursuant to any of the
foregoing.
"Managed Care Agreement" means the amended and restated the
managed care agreement, dated as of May 28, 2003 and as amended, supplemented or
modified to and including the date hereof, entered into between the Borrower and
Merck, provided that, in the event that such agreement is replaced to the extent
permitted by clause (n)(i) of Article VII references herein to the "Managed Care
Agreement" shall be deemed to refer to such replacement agreement or agreements.
"Material Adverse Effect" means a material adverse effect on (a)
the business, operations, properties, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Subsidiaries, taken as a whole,
or (b) the ability of the Borrower to perform any of its obligations under this
Agreement or any Loan Documents subject to applicable cure and grace periods.
"Material Indebtedness" means Indebtedness (other than the Loans
and Letters of Credit), or net termination payment obligations in respect of one
or more Swap Agreements, of any one or more of the Borrower and its Subsidiaries
in an aggregate principal amount exceeding $25,000,000. For purposes of
determining Material Indebtedness, the "principal amount" of the obligations of
the Borrower or any Subsidiary in respect of any Swap Agreement at any time
shall be the maximum aggregate amount (giving effect to any netting agreements)
that the Borrower or such Subsidiary would be required to pay if such Swap
Agreement were terminated at such time.
"Maturity Date" means:
(a) with respect to the Revolving Credit Facility, the earlier of
(i) the fifth anniversary of the Closing Date and (ii) the optional
prepayment in full of the Revolving Loans and cancellation by the
Borrower of the Lenders' total Revolving Credit Commitments;
(b) with respect to the Term A Loans, the earlier of (i) June 30,
2008 and (ii) the optional prepayment in full of the Term A Loans; and
(c) with respect to the Term B Loans, the earlier of (i) June 30,
2010 and (ii) the optional prepayment in full of the Term B Loan.
"Merck" means Merck & Co., Inc., a New Jersey corporation.
"Merck Dividend" means one or more dividends in the aggregate not
exceeding $2,000,000,000 made, or to be made, by the Borrower to Merck in
connection with the Spin-Off.
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"Moody's" means Xxxxx'x Investors Service, Inc. or any successor
to the rating agency business thereof.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" means proceeds received by the Borrower or
any of its Subsidiaries after the Closing Date in cash or (upon their maturity,
disposition or liquidation) Permitted Investments received from (a) any Asset
Sale, other than an Asset Sale permitted under Sections 6.03(b) or (d) net of
(i) the reasonable fees, commissions and other costs of sale, assignment or
other disposition, (ii) taxes paid or reasonably estimated to be payable as a
result thereof, in each case, after taking into account any available tax
credits or deductions and any tax sharing arrangements, (iii) any amount
required to be paid or prepaid on Indebtedness (other than the Obligations)
secured by the assets subject to such Asset Sale, (iv) applicable amounts paid
or which must be set aside (for so long as they have to be set aside) as
reserves in accordance with GAAP against any liabilities directly associated
with such Asset Sale and (v) payments made or which must be set aside (for so
long as they have to be set aside) by the Borrower or any of its Subsidiaries to
(and agreed with) the purchaser of the assets subject to such Asset Sale and
arising directly in connection with such Asset Sale (provided, that reasonable
details of the items referred to in clauses (i) through (v) above shall be
provided to the Administrative Agent if requested by it), or (b) any issuance of
Indebtedness permitted under Section 6.01(B)(o) net of underwriting discounts
and commissions or placement fees, investment banking fees, legal fees,
consulting fees, accountants' fees, brokers' and advisors' fees and other costs
incurred in connection with such transaction (provided, that in the case of this
clause (b), reasonable details of such fees and costs shall be provided to the
Administrative Agent if requested by it).
"Non-Funding Lender" means at any time, any Lender that, within
one Business Day of when due, (i) has failed to make a Loan or purchase a
participation interest in a Swingline Loan or an L/C Exposure required pursuant
to the terms of this Agreement, (ii) other than as set forth in clause (i)
above, has failed to pay to the Administrative Agent or any Lender an amount
owed by such Lender pursuant to the terms of the Agreement or any other Loan
Document unless such amount is subject to a good faith dispute or (iii) has been
deemed insolvent or has become subject to a receivership or insolvency event.
"Notes Indenture" means the Indenture with respect to the Notes
Offering, dated as of [____], 2003, between the Borrower as issuer and U.S. Bank
Trust National Association, as trustee.
"Notes Offering" means the public offering by the Borrower of
$500,000,000 aggregate principal amount of senior notes, as described in the
prospectus relating to such offering, dated [____], 2003 (registration statement
number 333-86404), as amended.
"Obligations" means the Loans, the L/C Exposure and all other
amounts, obligations, covenants and duties owing by the Borrower to the
Administrative Agent, any Lender, any Issuing Bank, any Affiliate of any of them
or any Indemnitee, of every type and description (whether by reason of an
extension of credit, opening or amendment of a letter of credit or payment of
any draft drawn thereunder, loan, guarantee, indemnification or otherwise),
present or future, arising under this Agreement, any other Loan Document,
whether direct or indirect (including those acquired by assignment), absolute or
contingent, due or to become due,
-15-
now existing or hereafter arising and however acquired and whether or not
evidenced by any note, guarantee or other instrument or for the payment of
money, including all letter of credit and other fees, interest, charges,
expenses, attorneys' fees and disbursements and other sums chargeable to the
Borrower under this Agreement, any other Loan Document and all obligations of
the Borrower under any Loan Document to provide cash collateral for L/C
Exposure.
"Off-Balance Sheet Liability" of a Person shall mean (i) any
liability under any Sale and Leaseback or any lease leaseback transaction which
is not a Capital Lease Obligation and (ii) any liability under any so called
"synthetic lease" transaction entered into by such Person.
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.
"Participant" has the meaning set forth in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes, assessments or governmental
charges, levies or claims that are not yet delinquent or which are
being contested in compliance with paragraphs (a) and (b) of Section
5.04;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens arising by operation of law, arising
in the ordinary course of business and securing obligations that do
not, individually or in the aggregate, materially detract from the
value of the property or assets which are the subject of such lien or
materially impair the use thereof in the operation of the business of
the Borrower or any of its Subsidiaries or are being contested in
compliance with paragraphs (a) and (b) of Section 5.04;
(c) Liens arising, and deposits made, in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(d) Liens incurred or deposits made to secure the performance of
bids, tenders, trade contracts, leases, statutory obligations, surety,
indemnity, release and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of
business;
(e) judgment Liens in respect of judgments that do not constitute
an Event of Default under paragraph (l) of Article VII;
(f) Liens relating to or arising in connection with Plans or
Multiemployer Plans in an aggregate amount not to exceed $25,000,000 at
any time;
-16-
(g) leases or subleases granted to others of property or assets
owned or leased by the Borrower or its Subsidiaries; any interest or
title of a lessor under an operating lease entered into in the ordinary
course of business, or any statutory and common law landlord Liens;
(h) Liens arising out of consignment or similar arrangements for
sales of goods entered into in the ordinary course of business;
(i) easements, ground leases, zoning restrictions, building
codes, rights-of-way, minor defects and irregularity in title and
similar encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property
or interfere with the ordinary conduct of business of the Borrower or
any Subsidiary;
(j) licenses of patents, trademarks or other intellectual
property rights granted by the Borrower or its Subsidiaries in the
ordinary course of business;
(k) Liens arising solely by virtue of any statutory or common law
provision relating to bankers' liens, rights of set-off or similar
rights, in each case incurred in the ordinary course of business;
(l) leases or subleases granted to third persons in the ordinary
course of business not interfering in any material respect with the
business of the Borrower or any of its Subsidiaries and not materially
detracting from the value of the property subject to such lease or
sublease; and
(m) the replacement, extension or renewal of any Lien permitted
hereunder; provided, that such replacement, extension or renewal Lien
shall not cover any property other than the property subject thereto
prior to such replacement, extension or renewal;
provided, that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness for borrowed money.
"Permitted Investments" means:
(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 or instrumentality thereof to the extent
such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within one year from the date
of acquisition thereof;
(b) investments in certificates of deposit, time deposits,
eurodollar time deposits and similar instruments with maturities of one
year or less from the date of acquisition, banker's acceptances
maturing within 180 days from the date of acquisition thereof, money
market deposit accounts, and demand deposits made in the ordinary
course of business, in each case with 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 $500,000,000;
-17-
(c) fully collateralized repurchase agreements with a term of not
more than 60 days for securities described in paragraph (a) above and
entered into with a financial institution satisfying the criteria
described in paragraph (c) above;
(d) securities issued or fully guaranteed by any State,
Commonwealth or sovereignty of the United States of America and rated
at least "A" by S&P or "P" by Moody's;
(e) commercial paper rated at least A-2 or the equivalent thereof
by S&P or P-2 or the equivalent thereof by Moody's and in each case
maturing within one year after the date of acquisition;
(f) money market funds that (i) comply with the criteria set
forth in SEC Rule 2a-7 under the Investment Company Act of 1940 or (ii)
at least 95% of the assets of which constitute Permitted Investments of
the kinds described in clauses (a) through (e) of this definition; and
(g) other investment instruments with the consent of the
Administrative Agent.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreement" means the pledge agreement, in substantially
the form of Exhibit H, executed by the Borrower.
"Pledged Stock" has the meaning assigned to such term in the
Pledge Agreement.
"Prime Rate" means the rate of interest per annum publicly
announced from time to time by JPMorgan Chase Bank as its prime rate in effect
at its principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Promissory Note" has the meaning assigned to such term in
Section 2.09(e).
"Receivables and Related Assets" means accounts receivable
(including any rebate receivables) and any related underlying contractual
rights, and solely to the extent evidencing, constituting or relating to such
assets or proceeds thereof, each of the following: instruments, chattel paper,
obligations, general intangibles, deposit accounts and other similar assets,
including interests in returned merchandise or returned goods, the sale or lease
of which give rise to the foregoing, related contractual rights, guarantees,
insurance proceeds, collections, other related assets and proceeds of all the
foregoing.
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"Refinancing Indebtedness" has the meaning assigned to such term
in Section 6.01(B)(p).
"Register" has the meaning set forth in Section 9.04.
"Related Documents" means the Separation and Transition
Agreements, the Securitization Documents and the Notes Indenture.
"Related Parties" means, with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"Required Class Lenders" means, at any time (a) with respect to
the Revolving Credit Facility, the Lenders having more than 50% of the Revolving
Credit Commitments at such time, (b) with respect to Term A Loans, the Lenders
holding more than 50% of Term A Loans at such time, or (c) with respect to Term
B Loans, the Lenders holding more than 50% of Term B Loans at such time. A
Non-Funding Lender shall not be included in the calculation of "Required Class
Lenders."
"Required Lenders" means, at any time, Lenders having more than
50% of (a) the aggregate outstanding amount of the Revolving Credit Commitments
or, after the Maturity Date for the Revolving Credit Facility, the aggregate
Revolving Credit Exposure, (b) the aggregate outstanding amount of the Term A
Loan Commitments or, after the Closing Date, the principal amount of the Term A
Loans then outstanding and (c) the aggregate outstanding amount of the Term B
Loan Commitments or, after the Closing Date, the principal amount of the Term B
Loans then outstanding. A Non-Funding Lender shall not be included in the
calculation of "Required Lenders."
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interests in the Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such Equity Interests in the Borrower or any option, warrant
or other right to acquire any such Equity Interests in the Borrower.
"Revolving Credit Commitment" means, with respect to each
Revolving Lender, the commitment of such Lender to make Revolving Loans and to
acquire participations in Letters of Credit and Swingline Loans hereunder,
expressed as an amount representing the maximum aggregate amount of such
Revolving Lender's Revolving Credit Exposure hereunder, as such commitment may
be (a) reduced from time to time pursuant to Section 2.08 and (b) reduced or
increased from time to time pursuant to assignments by or to such Revolving
Lender pursuant to Sections 2.18 or 9.04. The initial amount of each Revolving
Lender's Revolving Credit Commitment is set forth opposite such Revolving
Lender's name on Schedule 2.01 under the heading "Revolving Credit Commitment",
or in the Assignment and Assumption pursuant to which such Revolving Lender
shall have assumed its Revolving Credit Commitment, as applicable. The initial
aggregate amount of the Revolving Lenders' Revolving Credit Commitments is
$250,000,000.
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"Revolving Credit Exposure" means, with respect to any Lender at
any time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and its L/C Exposure and Swingline Exposure (each under the Revolving
Credit Facility) at such time.
"Revolving Credit Facility " means the Revolving Credit
Commitments and the provisions herein related to the Revolving Loans (including
Swingline Loans) and Letters of Credit.
"Revolving Lenders" means each Lender having a Revolving Credit
Commitment or having made Revolving Loans or acquired participations in Letters
of Credit and Swingline Loans.
"Revolving Loans" has the meaning assigned to such term in
Section 2.01(a).
"Sale and Leaseback" means any lease of any property (whether
real, personal or mixed), whether now owned or hereafter acquired, to which the
Borrower or any of its Subsidiaries, directly or indirectly, becomes or remains
liable as lessee or as a guarantor or other surety and which the Borrower has
sold or transferred or is to sell or to transfer to any other Person (other than
any of its Subsidiaries).
"S&P" means Standard & Poor's or any successor rating agency
business thereof.
"SEC" means the Securities and Exchange Commission or any
successor thereto.
"Secured Obligations" means (i) the Obligations, (ii) all Cash
Management Obligations owing to the Administrative Agent, any Lender or any of
their respective Affiliates and (iii) all Hedging Obligations owing to one or
more Hedging Creditors.
"Secured Parties" means (i) the Administrative Agent, (ii) each
Lender, (iii) each Issuing Bank, (iv) each Indemnitee, (v) the Administrative
Agent, each Lender and each of their respective Affiliates in respect of any
Cash Management Obligation owing to it, (vi) each Hedging Creditor in respect of
any Hedging Obligation owing to it and (vii) any other holder of a Secured
Obligation.
"Securitization" means the program under which the Borrower and
the Securitization SPV securitize Receivables and Related Assets entered into
among the Borrower, the Securitization SPV and the other parties thereto on or
before the Closing Date, as the same may be amended, supplemented, modified or
replaced from time to time in accordance herewith.
"Securitization Documents" means Receivables Purchase Agreement
and Receivables Purchase and Contribution Agreement, dated as of [ ], and each
other document or agreement entered into pursuant thereto with respect to the
Securitization.
"Securitization SPV" means Medco Health Receivables, LLC, a
bankruptcy-remote Subsidiary of the Borrower established pursuant to the
Securitization.
"Separation and Distribution Agreement" means the master
separation and distribution agreement entered, or to be entered, into between
the Borrower and Merck.
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"Separation and Transition Agreements" means the Separation and
Distribution Agreement, the Managed Care Agreement and each other agreement set
forth on Schedule 3.12(b).
"Significant Subsidiary" means, at any time, a Subsidiary that has or
represents at least 5% of (i) the consolidated gross revenues of the Borrower
and its Subsidiaries for the fiscal year then most recently ended and/or (ii)
the consolidated assets of the Borrower and its Subsidiaries as of the last day
of the fiscal year then most recently ended.
"Solvent" means, with respect to any Person, that as of the date of
determination (a) the sum of such Person's debt (including contingent
liabilities) does not exceed all of its property, at a present fair valuation on
a going concern basis; (b) the fair saleable value of the property on a going
concern basis of such Person is not less than the amount that will be required
to pay the probable liabilities on such Person's then existing debts as they
become absolute and matured; (c) such Person's capital is not unreasonably small
in relation to its business or any contemplated or undertaken transaction; and
(d) such Person does not intend to incur, or believe (nor should it reasonably
believe) that it will incur, debts beyond its ability to pay such debts as they
become due. For purposes of this definition, the amount of any contingent
liability at any time shall be computed as the amount that, in light of all of
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability
(irrespective of whether such contingent liabilities meet the criteria for
accrual under Statement of Financial Accounting Standard No. 5).
"Spin-Off" means the distribution of all the common stock of the
Borrower to stockholders of Merck pursuant to the Separation and Distribution
Agreement and the Spin-Off Registration Statement.
"Spin-Off Registration Statement" means the General Form for
Registration of Securities (Form 10) filed by the Borrower with the Securities
and Exchange Commission on May 28, 2003 (registration statement number 1-31312,
as amended).
"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 Administrative 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.
"Subordinated Indebtedness" means Indebtedness of the Borrower or its
Subsidiaries which is subordinated in right of payment to the Facilities.
"subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of
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which would be consolidated with those of the parent in the parent's
consolidated financial statements if such financial statements were prepared in
accordance with GAAP as of such date, as well as any other corporation, limited
liability company, partnership, association or other entity of which securities
or other ownership interests representing more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held.
"Subsidiary" means any subsidiary of the Borrower.
"Swap Agreement" means any agreement with respect to any swap,
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions; provided, that
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or its Subsidiaries shall be a Swap Agreement.
"Swingline Exposure" means, at any time hereunder, the aggregate
principal amount of all Swingline Loans outstanding at such time. The Swingline
Exposure of any Revolving Lender at any time shall be such Lender's Applicable
Percentage with respect to Revolving Credit Commitments multiplied by the
aggregate principal amount of all Swingline Loans outstanding at such time.
"Swingline Lender" means JPMorgan Chase Bank and Citicorp North
America, Inc., each in its capacity as a Lender of Swingline Loans hereunder,
and their respective successors in such capacity.
"Swingline Loan" means a Loan made pursuant to Section 2.04.
"Taxes" means any and all present or future taxes, levies, imposts,
deductions, charges or withholdings imposed by any Governmental Authority.
"Term A Lender" means each Lender having a Term A Loan Commitment or
having made a Term A Loan.
"Term A Loan" has the meaning assigned to such term in Section
2.01(b).
"Term A Loan Commitment" means, with respect to each Term A Lender,
the commitment of such Term A Lender to make a Term A Loan on the Closing Date
in the principal amount set forth on Schedule 2.01 opposite such Term A Lender's
name under the heading "Term A Loan Commitment".
"Term B Lender" means each Lender having a Term B Loan Commitment or
having made a Term B Loan.
"Term B Loan" has the meaning assigned to such term in Section
2.01(c).
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"Term B Loan Commitment" means, with respect to each Term B Lender,
the commitment of such Term B Lender to make a Term B Loan on the Closing Date
in the principal amount set forth on Schedule 2.01 opposite such Term B Lender's
name under the heading "Term B Loan Commitment".
"Term Loans" means, collectively, the Term A Loans and the Term B
Loans.
"Third-Party Claim" has the meaning assigned to such term in Section
9.03(b).
"Total Commitment" means, with respect to each Lender, the sum of such
Lender's Revolving Credit Commitment, Term A Loan Commitment and Term B Loan
Commitment.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans, the use of the proceeds
thereof and the issuance of Letters of Credit and Swingline Loans hereunder, the
Spin-Off, the Merck Dividend, the Notes Offering, the Securitization and all
other transactions contemplated by the Loan Documents and the Related Documents.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans constituting such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"UCC" means the Uniform Commercial Code (and any similar law) in
effect in any applicable jurisdiction.
"Withdrawal Liability" means 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 Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to 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". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
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any particular provision hereof, (d) all references herein to Articles,
Sections, paragraphs, clauses, Exhibits and Schedules shall be construed to
refer to, respectively, Articles, Sections paragraphs and clauses of, and
Exhibits and Schedules to, this Agreement and (e) the words "asset" and
"property" shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
The Credits
SECTION 2.01. Commitments. (a) Revolving Loans. Subject to the terms
and conditions set forth herein, each Revolving Lender, severally and not
jointly with the other Revolving Lenders, agrees to make revolving Loans (the
"Revolving Loans") to the Borrower from time to time during the Availability
Period in an aggregate principal amount that will not result in such Revolving
Lender's Revolving Credit Exposure exceeding such Revolving Lender's Revolving
Credit Commitment. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow
Revolving Loans.
(b) Term A Loans. Subject to the terms and conditions set forth
herein, each Term A Lender, severally and not jointly with the other Term A
Lenders, agrees to make a single term Loan (collectively, the "Term A Loans") to
the Borrower in an aggregate principal amount not to exceed such Term A Lender's
Term A Loan Commitment.
(c) Term B Loans. Subject to the terms and conditions set forth
herein, each Term B Lender, severally and not jointly with the other Term B
Lenders, agrees to make a single term Loan (collectively, the "Term B Loans") to
the Borrower in an aggregate principal amount not to exceed such Lender's Term B
Loan Commitment.
SECTION 2.02. Loans and Borrowings. (a) Revolving Loans. Each
Revolving Loan shall be made as part of a Borrowing consisting of Revolving
Loans from the Revolving Lenders ratably in accordance with their respective
Revolving Credit Commitments.
(b) Term Loans. The Term A Loans and the Term B Loans shall be made on
the Closing Date as Borrowings from, respectively, the Term A Lenders and the
Term B Lenders, in each case ratably in accordance with their respective Term A
Loan Commitments and Term B Loan Commitments.
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(c) Subject to Section 2.13, (i) each Revolving Borrowing shall be
comprised of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith, and (ii) the Term A Loan Borrowing and the Term B Loan
Borrowing shall each be initially comprised entirely of ABR Loans for such
period as shall be agreed in writing by the Borrower and the Administrative
Agent. Each Swingline Loan shall be an ABR Loan. Each Lender at its option may
make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate
of such Lender to make such Loan in accordance with the terms hereof; provided
that 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.
(d) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is equal to
$5,000,000 or an integral multiple of $1,000,000 in excess thereof. At the time
that each ABR Revolving Borrowing is made, such Borrowing shall be in an
aggregate amount that is equal to $1,000,000 or an integral multiple of
$1,000,000 in excess thereof; provided that an ABR Revolving Borrowing may be in
an aggregate amount that is equal to the entire unused balance of the total
Revolving Credit Commitments, or that is required to finance the reimbursement
of an L/C Disbursement as contemplated by Section 2.05(e) or the repayment of a
Swingline Loan as contemplated by Section 2.09(a)(iv). Each Swingline Loan shall
be in an amount that is equal to $500,000 or an integral multiple of $100,000 in
excess thereof unless otherwise agreed by each Swingline Lender; provided that a
Swingline Loan may be in an aggregate amount that is required to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.05(e).
Borrowings of more than one Type and Class may be outstanding at the same time;
provided that there shall not at any time be more than a total of fifteen
Eurodollar Revolving Borrowings outstanding.
(e) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Maturity Date.
SECTION 2.03. Requests for Revolving Borrowings. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of such
request by telephone (i) in the case of a Eurodollar Borrowing, not later than
12:00 noon, New York City time, three Business Days before the date of the
proposed Borrowing or (ii) in the case of an ABR Borrowing, not later than 12:00
noon, New York City time, on the date of the proposed Borrowing; provided that
any such notice of an ABR Revolving Borrowing to finance the reimbursement of an
L/C Disbursement as contemplated by Section 2.05(e) may be given not later than
11:00 a.m., New York City time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request substantially in the form attached as Exhibit C and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.02:
(1) the aggregate amount of the requested Borrowing;
(2) the date of such Borrowing, which shall be a Business Day;
(3) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;
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(4) in the case of a Eurodollar Borrowing, the initial Interest Period
to be applicable thereto, which shall be a period contemplated by the
definition of the term "Interest Period"; and
(5) the location and number of the Borrower's account to which funds
are to be disbursed, which shall comply with the requirements of
Section 2.06.
If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Revolving Lender of the
details thereof and of the amount of such Revolving Lender's Loan to be made as
part of the requested Borrowing.
SECTION 2.04. Swingline Loans. (a) Subject to the terms and conditions
set forth herein, each Swingline Lender severally agrees to make Swingline Loans
to the Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of all outstanding Swingline Loans exceeding
$100,000,000, (ii) the aggregate principal amount of all outstanding Swingline
Loans made by any individual Swingline Lender exceeding $50,000,000, or (iii)
the sum of the total Revolving Credit Exposures exceeding the Revolving Lenders'
total Revolving Credit Commitments; provided that no Swingline Lender shall be
required to make a Swingline Loan to refinance an outstanding Swingline Loan.
Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy
substantially in the form attached as Exhibit D), not later than 12:00 noon, New
York City time, on the day of a proposed Swingline Loan. Each such notice shall
be irrevocable and shall specify (i) the requested date for making such
Swingline Loan (which shall be a Business Day) and (ii) the amount of the
requested Swingline Loan. The Administrative Agent will promptly advise each
Swingline Lender of any such notice received from the Borrower requesting a
Swingline Loan to be made by it. Each requested Swingline Lender shall make on
half of such Swingline Loan available to the Borrower in immediately available
funds by means of a credit to the general deposit account of the Borrower with
such Swingline Lender (or, in the case of a Swingline Loan made to finance the
reimbursement of an LC Disbursement as provided in Section 2.05(e), by
remittance to the Issuing Bank) by the later of 12:00 noon, New York City time,
or two hours after receipt by the Administrative Agent of a request for such
Swingline Loan on the requested date of such Swingline Loan.
(c) Each Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., New York City time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans made by it which are
outstanding. Such notice shall specify the aggregate amount of Swingline Loans
in which Revolving Lenders will participate. Promptly upon receipt of such
notice, the Administrative Agent will give notice thereof to each Revolving
Lender, specifying in such notice such Revolving Lender's Applicable Percentage
of such Swingline Loan or Loans. Each Revolving Lender hereby absolutely and
unconditionally agrees, upon receipt of notice as
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provided above, to pay to the Administrative Agent, for the account of each
Swingline Lender, such Revolving Lender's Applicable Percentage of such
Swingline Loan or Loans. Each Revolving Lender acknowledges and agrees that its
obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Revolving Credit Commitments, and that each
such payment shall be made without any offset, abatement, withholding or
reduction whatsoever. Each Revolving Lender shall comply with its obligation
under this paragraph by wire transfer of immediately available funds, in the
same manner as provided in Section 2.06 with respect to Loans made by such
Revolving Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to each Swingline Lender its share of the amounts so received by it
from the Revolving Lenders. The Administrative Agent shall notify the Borrower
of any participations in any Swingline Loan acquired pursuant to this paragraph,
and thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lenders. Any amounts received by
any Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by such Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Revolving
Lenders that shall have made their payments pursuant to this paragraph and to
each Swingline Lender, as their interests may appear; provided that any such
payment so remitted shall be repaid to each Swingline Lender or to the
Administrative Agent, as applicable, if and to the extent such payment is
required to be refunded to the Borrower for any reason. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower of any default in the payment thereof.
SECTION 2.05. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower may request the issuance of Letters of
Credit for its own account (or for its account and the account of one or more of
its Subsidiaries, collectively), in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (at least two Business Days or, if reasonable,
less than two Business Days in advance of the requested date of issuance,
amendment, renewal or extension) a notice substantially in the form attached as
Exhibit E requesting the issuance of a Letter of Credit, or identifying the
Letter of Credit to be amended, renewed or extended, and specifying the date of
issuance, amendment, renewal or extension (which shall be a Business Day), the
date on which such Letter of Credit is to expire (which shall comply with
paragraph (c) of this Section), 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, amend, renew or extend such Letter of Credit. If requested
by the Issuing Bank no later than upon its receipt of a notice from
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the Borrower requesting the issuance of a Letter of Credit, the Borrower also
shall submit a letter of credit application on the Issuing Bank's standard form
in connection with any request for a Letter of Credit. A Letter of Credit shall
be issued, amended, renewed or extended by the Issuing Bank in accordance with
the notice with respect thereto received from the Borrower; provided that after
giving effect to such issuance, amendment, renewal or extension (i) the L/C
Exposure shall not exceed $150,000,000 and (ii) the sum of the Lenders' total
Revolving Credit Exposures shall not exceed the Lenders' total Revolving
Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the earlier of (i) the date one year after the date of
the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date of the Revolving Credit
Facility.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Revolving Lenders, the
Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender
hereby acquires from the Issuing Bank, a participation in such Letter of Credit
equal to such Lender's Applicable Percentage of the aggregate amount available
to be drawn under such Letter of Credit. In consideration and in furtherance of
the foregoing, each Revolving Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of the Issuing Bank,
such Revolving Lender's Applicable Percentage of each L/C Disbursement made by
the Issuing Bank and not reimbursed by the Borrower on the date due as provided
in paragraph (e) of this Section 2.05, or of any reimbursement payment required
to be refunded to the Borrower for any reason. Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph (d) of this Section 2.05 in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any L/C Disbursement
in respect of a Letter of Credit, the Borrower shall reimburse such L/C
Disbursement by paying (or causing its Subsidiary that is also an account party
in respect of such Letter of Credit to pay) to the Administrative Agent an
amount equal to such L/C Disbursement not later than 12:00 noon, New York City
time, on the date that such L/C Disbursement is made, if the Borrower shall have
received notice of such L/C Disbursement prior to 10:00 a.m., New York City
time, on such date, or, if such notice has not been received by the Borrower
prior to such time on such date, then not later than 12:00 noon, New York City
time, on (i) the Business Day that the Borrower receives such notice, if such
notice is received prior to 10:00 a.m., New York City time, on the day of
receipt, or (ii) the Business Day immediately following the day that the
Borrower receives such notice, if such notice is not received prior to such time
on the day of receipt; provided that the Borrower may, subject to the conditions
to borrowing set forth herein, request in accordance with Section 2.03 that such
payment be financed with an ABR Revolving Borrowing (only if such L/C
Disbursement is not less than $1,000,000), or a Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrower fails to make such payment or
discharge such reimbursement obligation when due or in accordance with
-28-
the prior sentence, the Administrative Agent shall notify each Revolving Lender
of the applicable L/C Disbursement, the payment then due from the Borrower in
respect thereof and such Revolving Lender's Applicable Percentage thereof.
Promptly following receipt of such notice, each Revolving Lender shall pay to
the Administrative Agent its Applicable Percentage of the payment then due from
the Borrower, in the same manner as provided in Section 2.06 with respect to
Loans made by such Revolving Lender (and Section 2.06 shall apply, mutatis
mutandis, to the payment obligations of the Revolving Lenders), and the
Administrative Agent shall promptly pay to the Issuing Bank the amounts so
received by it from the Revolving Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this paragraph
(e) of this Section 2.05, the Administrative Agent shall distribute such payment
to the Issuing Bank or, to the extent that Revolving Lenders have made payments
pursuant to this paragraph to reimburse the Issuing Bank, then to such Revolving
Lenders and the Issuing Bank as their interests may appear. Any payment made by
a Revolving Lender pursuant to this paragraph (e) of this Section 2.05 to
reimburse the Issuing Bank for any L/C Disbursement (other than the funding of
ABR Revolving Loan or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrower of its obligation to
reimburse such L/C Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse L/C
Disbursements as provided in paragraph (e) of this Section 2.05 shall be
absolute, 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
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect to any statement therein being untrue or
inaccurate in any respect, (iii) 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, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section 2.05, constitute a legal or equitable discharge
of, or provide a right of setoff against, the Borrower's obligations hereunder.
Neither the Administrative Agent, the Revolving Lenders nor the Issuing Bank,
nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to in the preceding sentence), or any error,
omission, interruption, loss or delay in transmission or delivery of any draft,
notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of the Issuing Bank; provided that the foregoing shall not be
construed to excuse the Issuing Bank from liability to the Borrower to the
extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law) suffered by the Borrower that are caused by the Issuing Bank's
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof. The parties
hereto expressly agree that, in the absence of gross negligence, bad faith or
willful misconduct on the part of the Issuing Bank (as finally determined by a
court of competent jurisdiction), the Issuing Bank shall be deemed to have
exercised care in each such determination. In furtherance of the foregoing and
without limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Bank may, in its sole
discretion, either accept and make payment upon such documents without
-29-
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.
(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. The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the 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 Revolving Lenders with respect to any such
L/C Disbursement in accordance with Section 2.05(e) after receipt of the notice
from the Issuing Bank contemplated thereby.
(h) Interim Interest. If the Issuing Bank shall make any L/C
Disbursement, then, unless the Borrower shall reimburse such L/C Disbursement in
full on the date such L/C Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such L/C Disbursement is
made to but excluding the date that the Borrower reimburses such L/C
Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
provided that, if the Borrower fails to reimburse such L/C Disbursement when due
pursuant to paragraph (e) of this Section 2.05, then Section 2.12(c) shall
apply. Interest accrued pursuant to paragraph (e) of this Section 2.05 shall be
for the account of the Issuing Bank, except that interest accrued on and after
the date of payment by any Revolving Lender pursuant to paragraph (e) of this
Section 2.05 to reimburse the Issuing Bank shall be for the account of such
Revolving Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced
at any time by written agreement among the Borrower, the Administrative Agent,
the replaced Issuing Bank and the successor Issuing Bank. The Administrative
Agent shall notify the Revolving Lenders of any such replacement of the Issuing
Bank. At the time any such replacement shall become effective, the Borrower
shall pay all unpaid fees accrued for the account of the replaced Issuing Bank
pursuant to Section 2.11(b)(ii). From and after the effective date of any such
replacement, (i) the successor Issuing Bank shall have all the rights and
obligations of the Issuing Bank under this Agreement with respect to Letters of
Credit to be issued thereafter 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 replacement of an Issuing Bank hereunder, the replaced
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 replacement, but shall not be
required to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Class Lenders under the Revolving Credit
Facility (or, if the maturity of the Loans has been accelerated, Revolving
Lenders with L/C Exposure representing greater than 50% of the total L/C
Exposure) demanding the deposit of cash collateral pursuant to this paragraph
(j) of this Section 2.05, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Revolving Lenders, an amount in cash equal to the L/C Exposure as
of such date plus any accrued and unpaid interest thereon;
-30-
provided that the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of any
Event of Default with respect to the Borrower described in paragraph (i) or (j)
of Article VII. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the Obligations of the Borrower.
The Administrative 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, which investments shall be made at
the option and sole discretion of the Administrative Agent and at the Borrower's
risk and expense, such deposits shall not bear interest. Interest or profits, if
any, on such investments shall accumulate in such account. Moneys in such
account shall be applied by the Administrative Agent to reimburse the Issuing
Bank for L/C Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of the reimbursement
obligations of the Borrower for the L/C Exposure at such time or, if the
maturity of the Loans has been accelerated (but subject to the consent of
Revolving Lenders with L/C Exposure representing greater than 50% of the total
L/C Exposure), 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.
SECTION 2.06. Funding of Borrowings. (a) Each Lender shall make each
Loan committed to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 12:00 noon, New York City time, to
the account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders, provided, that Swingline Loans shall be made
as provided in Section 2.04. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the aggregate amounts so
received from the Lenders, in immediately available funds, to an account of the
Borrower maintained with the Administrative Agent in New York City and
designated by the Borrower in the applicable Borrowing Request; provided, that
ABR Revolving Loans made to finance the reimbursement of an L/C Disbursement as
provided in Section 2.05(e) shall be remitted by the Administrative Agent to the
Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
2.06 and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, the
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Lender for each day from and including the date such amount is
made available to the Borrower to but excluding the date of payment to the
Administrative Agent at the greater of (x) the Federal Funds Effective Rate and
(y) a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation. If such Lender does not pay such
corresponding amount with interest thereon upon Administrative Agent's demand
therefor and Administrative Agent previously made such amount available to
Borrower, Administrative Agent shall promptly notify Borrower and, if so
notified, Borrower shall immediately pay such corresponding amount to
Administrative Agent at the interest rate applicable to the relevant Borrowing
for each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the
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Administrative Agent. If such Lender pays such amount to the Administrative
Agent, then such amount shall constitute such Lender's Loan included in such
Borrowing.
SECTION 2.07. Interest Elections. (a) Each Revolving Borrowing
initially shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Revolving Borrowing, shall have an initial
Interest Period as specified in such Borrowing Request. Each Borrowing of Term
Loans shall initially be of a Type as provided in Section 2.02(c). Thereafter,
the Borrower may elect to convert each such Borrowing to a different Type or to
continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect
Interest Periods therefor, all as provided in this Section 2.07. The Borrower
may elect different Type options with respect to different portions of each
affected Borrowing, in which case each such portion shall be allocated ratably
among the applicable Lenders holding the Loans constituting such Borrowing, and
the Loans constituting each such portion shall be considered a separate
Borrowing. This Section 2.07 shall not apply to Swingline Borrowings and
accordingly no Swingline Borrowings may be converted or continued.
(b) To make an election pursuant to this Section 2.07, the Borrower
shall notify the Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.03 if the Borrower
were requesting a Revolving Borrowing of the Type resulting from such election
to be made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request substantially in the form attached as Exhibit F and signed by the
Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02(d):
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to
paragraphs (iii) and (iv) below of this Section 2.07(c) shall be specified
for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
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(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Revolving Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each
Eurodollar Revolving Borrowing shall be converted to an ABR Borrowing at the end
of the Interest Period applicable thereto.
SECTION 2.08. Termination and Reduction of Commitments. (a)
Termination. Unless previously terminated, (i) the Revolving Credit Commitments
shall terminate on the Maturity Date for the Revolving Credit Facility and (ii)
the Term A Commitments and the Term B Commitments shall terminate on the Closing
Date immediately after giving effect to all Borrowings which are made on such
date.
(b) Optional Reduction. The Borrower may at any time terminate, or
from time to time reduce, the Revolving Credit Commitments; provided that (i)
each reduction of the Revolving Credit Commitments shall be in an amount that is
equal to $5,000,000 or an integral multiple of $1,000,000 in excess thereof and
(ii) the Borrower shall not terminate or reduce the Revolving Credit Commitments
to the extent that, after giving effect to any concurrent prepayment of the
Revolving Loans in accordance with Section 2.11, the Revolving Credit Exposures
would exceed the Revolving Credit Commitments as so terminated or reduced.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Revolving Credit Commitments under paragraph
(b) of this Section 2.08 at least three Business Days prior to the effective
date of such termination or reduction specifying such election and the effective
date thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Revolving Lenders of the contents thereof. Each notice
delivered by the Borrower pursuant to this Section 2.08 shall be irrevocable;
provided that a notice of termination of the Revolving Credit Commitments
described in paragraph (b) of this Section 2.08 delivered by the Borrower may
state that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Revolving Credit
Commitments shall be permanent. Each reduction of the Revolving Credit
Commitments shall be made ratably among the Revolving Lenders in accordance with
their respective Revolving Credit Commitments.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay:
(i) in respect of Revolving Loans, to the Administrative Agent for
the account of each Revolving Lender, the then unpaid principal amount of
each Revolving Loan on Maturity Date for the Revolving Credit Facility;
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(ii) in respect of Term A Loans, to the Administrative Agent for the
account of each Term A Lender, in consecutive quarterly installments, in
the applicable amount determined as a percentage of the aggregate Term A
Loans outstanding immediately following the Closing Date, as set forth
below, on the last day of each of March, June, September and December, the
first payment to be made December 31, 2003, to be applied against the Term
A Loans with respect to the Type and, if applicable, the Interest Period as
the Borrower shall elect, but subject to Section 2.15:
==================================================
Installments Percentage Amount of each Term A
Loan Installment
--------------------------------------------------
1 - 3 2.500%
--------------------------------------------------
4 - 7 3.750%
--------------------------------------------------
8 - 11 5.000%
--------------------------------------------------
12 - 15 6.250%
--------------------------------------------------
16 - 19 8.125%;
==================================================
(iii) in respect of Term B Loans, to the Administrative Agent for the
account of each Term B Lender, in consecutive quarterly installments, in
the applicable amount determined as a percentage of the aggregate Term B
Loans outstanding immediately following the Closing Date set forth below,
on the last day of each of March, June, September and December, the first
payment to be made December 31, 2003, to be applied against the Term B
Loans with respect to the Type and, if applicable, the Interest Period as
the Borrower shall elect, but subject to Section 2.15:
===================================================
Installments Percentage Amount of each Term B
Loan Installment
---------------------------------------------------
1 - 26 0.2500%
---------------------------------------------------
27 93.5%; and
===================================================
(iv) in respect of Swingline Loans, to the Swingline Lenders the then
unpaid principal amount of each Swingline Loan made by them from the
proceeds of a Revolving Borrowing or otherwise on the earlier of the
Maturity Date for the Revolving Credit Facility and the first date after
such Swingline Loan is made that is the 15th or last day of a calendar
month and is at least one Business Day after such Swingline Loan is made;
provided, that on each date a Revolving Borrowing is made, the Borrower
shall repay all Swingline Loans then outstanding.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the Obligations 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 Administrative 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
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received by the Administrative Agent hereunder for the account of the Lenders
and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraphs (b) or (c) of this Section 2.09 shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that the Loans of any Class made by it be
evidenced by a promissory note (each a "Promissory Note"). In such event, the
Borrower shall prepare, execute and deliver to such Lender, with respect to such
Loans, 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 the forms
attached as Exhibit G-1, G-2 and G-3, as applicable to such Loans. Thereafter,
such Loans of such Lender evidenced by such Promissory Note, and interest
thereon, shall at all times (including after assignment pursuant to Section
9.04) be represented by one or more Promissory Notes in such form payable to the
order of the payee named therein (or, if such Promissory Note is a registered
note, to such payee and its registered assigns).
SECTION 2.10. Prepayment of Loans. (a) Optional Prepayment. The
Borrower shall have the right at any time and from time to time to prepay the
Term Loans or the Revolving Loans, in each case in an amount (if less than the
aggregate outstanding principal amount of such Loans) equal to $5,000,000 or an
integral amount of $1,000,000 in excess thereof (or such lesser amount of any
class of Loans as is then outstanding), subject to prior notice in accordance
with this Section 2.10 and subject to Section 2.15. The Borrower shall notify
the Administrative Agent (and, in the case of prepayment of a Swingline Loan,
each Swingline Lender thereof) by telephone (confirmed by telecopy) of any
prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing,
not later than 11:00 a.m., New York City time, three Business Days before the
date of prepayment, (ii) in the case of prepayment of an ABR Revolving Borrowing
or a Swingline Loan, not later than 12:00 noon, New York City time, on the date
of prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof to
be prepaid; provided that, if a notice of prepayment is given in connection with
a conditional notice of termination of the Revolving Credit Commitments as
contemplated by Section 2.08, then such notice of prepayment may be revoked if
such notice of termination is revoked in accordance with Section 2.08. Promptly
following receipt of any such notice of prepayment relating to the Term Loans,
the Administrative Agent shall advise the Term Lenders of the contents of such
notice. Each prepayment of the Term Loans shall be applied pro rata between the
then outstanding principal amounts of the Term A Loans and the Term B Loans to
reduce the future quarterly installment amounts thereof payable, respectively,
under Sections 2.09(a)(ii) and (iii) on a pro rata basis.
(b) Mandatory Prepayments.
(i) The Borrower shall prepay Loans, without premium or penalty, but
subject to Section 2.15, with (A) 100% of the Net Cash Proceeds received
from Asset Sales (other than such Net Cash Proceeds to the extent that they
(x) arise from an Asset Sale (or a series of related Asset Sales) in an
amount less than $10,000,000, and (y) do not exceed $25,000,000 in
aggregate during any single fiscal year of the Borrower), provided,
however, that the Borrower may elect to commit to reinvest such Net Cash
Proceeds in
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its or any of its Subsidiaries' business within twelve months of the
receipt of such Net Cash Proceeds (such election to be made by a written
notice to the Administrative Agent describing such proposed reinvestment in
reasonable detail), in which case such amounts shall be applied to repay
the Revolving Loans then outstanding, if any, or otherwise (if none are
outstanding) as directed by the Borrower, provided, further, that to the
extent the Borrower does not so reinvest such proceeds within such period,
it shall prepay, at the expiration of such twelve month period, the
outstanding Loans in an amount equal to such non-reinvested proceeds; (B)
if the credit rating for the Facilities is not at least BBB- and at least
Baa3 (as respectively rated by S&P and Xxxxx'x, and in each case with a
stable or positive outlook) at the time of receipt of such Net Cash
Proceeds, 100% of the Net Cash Proceeds received from any issuance of
Indebtedness of the Borrower or its Subsidiaries pursuant to Section
6.01(B)(o) and (C) if the credit rating for the Facilities is not at least
BBB- and at least Baa3 (as respectively rated by S&P and Xxxxx'x, and in
each case with a stable or positive outlook at the time any such payment is
required to be made hereunder), within 90 days after the last day of each
fiscal year of the Borrower, an amount equal to 50% of Excess Cash Flow for
such fiscal year provided, that, the no such payment of Excess Cash Flow
pursuant to this clause(C) shall be required with respect to fiscal year
2003.
(ii) The mandatory prepayments referred to in paragraph (i) above
shall (except as otherwise provided therein) be applied first pro rata
between the then outstanding principal amounts of the Term A Loans and
(subject to paragraph (iii) below) the Term B Loans to reduce the future
quarterly installment amounts thereof payable, respectively, under Sections
2.09(a)(ii) and (iii) on a pro rata basis and second to outstanding
Revolving Loans, and thereafter to cash-collateralization of outstanding
Letters of Credit.
(iii) With respect to any mandatory prepayment of Term Loans pursuant
to paragraph (ii) above, any Term B Lender may, at its option, to the
extent that Term A Loans are then outstanding, elect not to accept such
prepayment (any Term B Lender making such election being a "Declining
Lender") as follows: each Declining Lender shall give written notice
thereof to the Administrative Agent not later than 10:00 a.m. New York City
time on the Business Day preceding the date (as notified by the
Administrative Agent) of the applicable prepayment. On such date of
prepayment, (x) an amount equal to that portion of the Term B Loans then to
be prepaid to the Term B Lenders (less the amount thereof that would
otherwise be payable to Declining Lenders) shall be paid to the Term B
Lenders that are not Declining Lenders and (y) an amount equal to that
portion of the Term B Loans that would otherwise be payable to Declining
Lenders shall be applied in prepayment of the Term A Loans on a pro rata
basis as provided in paragraph (ii) above. In the event that the
Administrative Agent has not, with respect to any mandatory prepayment,
received a notice from a Term B Lender in accordance with this paragraph
(iii), such Term B Lender shall be deemed to have waived its rights under
this paragraph (iii) to decline receipt thereof.
SECTION 2.11. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender an unused
commitment fee (an "Unused Commitment Fee"), which shall accrue at the
Applicable Commitment Fee Rate on the daily amount of the excess of (i) such
Revolving Lender's Revolving Credit Commitment over (ii) such Revolving Lender's
Revolving Credit Exposure (excluding such Revolving Lender's Swingline
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Exposure) during the period from and including the date hereof to, but
excluding, the date on which any such Revolving Credit Commitment terminates.
Accrued Unused Commitment Fees shall be payable in arrears on the last day of
March, June, September and December of each year and on the date on which the
Revolving Credit Commitments terminate, the first payment to be made September
30, 2003. All Unused Commitment 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).
(b) The Borrower agrees to pay (i) to the Administrative Agent for
the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Interest Rate Margin used to determine the interest rate applicable to
Eurodollar Revolving Loans on the average daily amount of such Revolving
Lender's L/C Exposure (excluding any portion thereof attributable to
unreimbursed L/C Disbursements) during the period from and including the Closing
Date up to but excluding the later of the date on which such Revolving Lender's
Revolving Credit Commitment terminates and the date on which such Revolving
Lender ceases to have any L/C Exposure, and (ii) to the Issuing Bank a fronting
fee, which shall accrue at a 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 date
hereof to, but excluding, the later of the date of termination of the Revolving
Credit 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. Fronting fees accrued through and including the last day of
March, June, September and December of each year shall be payable on the third
Business Day following such last day, the first payment to be made no earlier
than September 30, 2003; provided that all such fees shall be payable on the
date on which the Revolving Credit 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 10 days after demand. All fees under this
Section 2.11(b) 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).
(c) The Borrower agrees to pay to the Administrative Agent, for its
own account, the fees payable to the Administrative Agent pursuant to the Fee
Letters.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
facility fees and participation fees, to the Lenders. Fees paid shall not be
refundable under any circumstances.
SECTION 2.12. Interest. (a) The Loans constituting each ABR Borrowing
(including each Swingline Loan) shall bear interest at the Alternate Base Rate
plus the Applicable Interest Margin Rate for such Loan.
(b) Each Loan constituting each Eurodollar Borrowing shall bear
interest in the case of a Eurodollar Loan, at the Adjusted LIBO Rate for the
Interest Period in effect for such Borrowing plus the Applicable Interest Margin
Rate for such Loan.
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(c) Notwithstanding the foregoing, following the occurrence and
during the continuance of an Event of Default, any principal of, or interest on
any Loan or any fee or other Obligation payable by the Borrower hereunder shall
bear interest, after as well as before judgment, at a rate per annum equal to
(i) in the case of principal of any Loan, 2.0% per annum plus the rate otherwise
applicable to such Loan as provided in the preceding clauses of this Section
2.12 and (ii) in the case of any other Obligation that has become due and
payable (but is unpaid), 2.0% plus the rate applicable to ABR Loans as provided
in paragraph (a) of this Section 2.12.
(d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and, in the case of Revolving Loans, upon
termination of the Revolving Credit Commitments; provided that (i) interest
accrued pursuant to paragraph (c) of this Section 2.12 shall be payable on
demand, (ii) in the event of any repayment or prepayment of any Loan (other than
a prepayment of an ABR Revolving Loan prior to the end of the Availability
Period), accrued interest on the principal amount repaid or prepaid shall be
payable on the date of such repayment or prepayment and (iii) in the event of
any conversion of any Eurodollar Revolving Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate,
Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent,
and such determination shall be conclusive absent manifest error. The
Administrative Agent shall, at any time and from time to time upon request of
Borrower, deliver to Borrower a statement showing the quotations used by
Administrative Agent in determining any interest rate applicable to Revolving
Loans pursuant to this Agreement.
SECTION 2.13. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines in good faith (which
determination shall be conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the
LIBO Rate, as applicable, for such Interest Period; or
(b) the Administrative Agent is notified by the Required Lenders that
the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period
will not adequately and fairly reflect the cost to such Lender of making or
maintaining their Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing for such Interest
Period shall be ineffective and (ii) if any Borrowing Request requests a
Eurodollar Revolving Borrowing, such Borrowing shall be made as an ABR
Borrowing. The Administrative Agent shall notify the
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Borrower as promptly as practicable of receipt of any notice from the Required
Lenders referred to in paragraph (b) above of this Section 2.13. Any Lender
delivering such notice shall be deemed to be an "Affected Lender" for purposes
hereof until such Lender delivers to the Administrative Agent and the Borrower a
withdrawal of such notice.
SECTION 2.14. Increased Costs. (a) If any Change in Law shall:
(i) 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, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London interbank
market any other condition affecting this Agreement or Eurodollar Loans
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 of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then
subject to paragraphs (c) and (d) of this Section 2.14, the Borrower will pay to
such Lender or the Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or the Issuing Bank, as the case may be,
for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in
Law regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender's or the Issuing Bank's capital or on the capital
of such Lender's or the Issuing Bank's holding company, if any, as a consequence
of this Agreement or the Loans made by, or participations in Letters of Credit
held by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a
level below that which such Lender or the Issuing Bank or such Lender's or the
Issuing Bank's holding company could have achieved but for such Change in Law
(taking into consideration such Lender's or the Issuing Bank's policies and the
policies of such Lender's or the Issuing Bank's holding company with respect to
capital adequacy), then subject to paragraphs (c) and (d) of this Section 2.14,
the Borrower will pay to such Lender or the Issuing Bank, as the case may be,
such additional amount or amounts as will compensate such Lender or the Issuing
Bank or such Lender's or the Issuing Bank's holding company for any such
reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount(s) necessary to compensate such Lender or the Issuing Bank or its holding
company, as the case may be, and the basis for the calculation thereof as
specified in paragraph (a) or (b) of this Section 2.14 shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender or the Issuing Bank, as the case may be, the amount shown as due on
any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank
to demand compensation pursuant to this Section 2.14 shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such compensation;
provided that the Borrower shall not be
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required to compensate a Lender or the Issuing Bank pursuant to this Section
2.14 for any increased costs or reductions incurred more than 180 days prior to
the date that such Lender or the Issuing Bank, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender's or the Issuing Bank's intention to claim compensation
therefor; provided further that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the 180-day period referred
to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the payment
of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Eurodollar Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.10(b) and is revoked in accordance therewith), or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.18, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense sustained by such Lender (or its Affiliates) as a
result of such event. In the case of a Eurodollar Loan, such loss, cost or
expense to any Lender shall include any loss or expense incurred by reason of
the liquidation or redeployment of deposits or other funds acquired by such
Lender to fund or maintain such Eurodollar Loan to the Borrower, but shall
exclude any loss of anticipated Applicable Interest Rate Margin that would have
accrued following such event with respect to each such Eurodollar Loan but for
the occurrence of such event. A certificate of any Lender setting forth any
amount(s) that such Lender is entitled to receive and the basis for the
calculation thereof pursuant to this Section 2.15 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 10 days after
receipt thereof.
SECTION 2.16. Taxes. (a) Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions the Administrative Agent, Lender(s) or
Issuing Bank (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each
Lender and the Issuing Bank, within 10 days after written demand therefor, for
the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or
with respect to any payment by or on account of any obligation of the Borrower
hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or
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Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt, if any, issued by such Governmental Authority evidencing such payment,
a copy of the return, if any, reporting such payment or other evidence of such
payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax with respect to any Indemnified Tax or Other Tax
(including by application of any treaty, the benefits of which such Lender is
entitled), with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), on or prior to the date such
Foreign Lender becomes a party to this Agreement (or designates a new lending
office) and at such other times as may be necessary in the reasonable
determination of the Borrower or Administrative Agent, (i) two original copies
of Internal Revenue Service Form W-8BEN or W-8ECI (or any successor forms),
properly completed and duly executed by such Lender, and such other
documentation required under the Code to establish that such Lender is not
subject to deduction or withholding of United States federal income tax with
respect to any payments to such Lender of principal, interest, fees or other
amounts payable under this Agreement, or (ii) if such Lender is not a "bank" or
other Person described in Section 881(c)(3) of the Code and cannot deliver
either Internal Revenue Service Form W-8BEN or W-8ECI pursuant to clause (i)
above of this Section 2.16(e), a Certificate of Non-Bank Status together with
two original copies of Internal Revenue Service Form W-8 (or any successor
form), properly completed and duly executed by such Lender, and such other
documentation required under the Code to establish that such Lender is not
subject to deduction or withholding of United States federal income tax with
respect to any payments to such Lender of interest payable under this Agreement.
Each Lender that is not a Foreign Lender shall deliver to the Borrower (with a
copy to the Administrative Agent) two duly completed copies of United States
Internal Revenue Form W-9 (or applicable successor form) unless it establishes
to the satisfaction of the Borrower that the Lender is otherwise eligible for an
exemption from backup withholding tax or other applicable withholding tax. Each
Lender hereby agrees, from time to time after the initial delivery by such
Lender of such forms, certificates or other evidence required to be provided
pursuant to the first two sentences of this Section 2.16(e), whenever a lapse in
time or change in circumstances renders such forms, certificates or other
evidence obsolete or inaccurate in any material respect, that such Lender shall
promptly deliver to Administrative Agent for transmission to the Borrower two
new original copies of Internal Revenue Service Form X-0XXX, X-0XXX or W-9 or a
Certificate of Non-Bank Status and two original copies of Internal Revenue
Service Form W-8, as the case may be, properly completed and duly executed by
such Lender, and such other documentation required under the Code to confirm or
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to payments to such Lender under this
Agreement, or notify Administrative Agent and the Borrower of its inability to
deliver any such forms, certificates or other evidence. Notwithstanding any
other provision of this Section 2.16(e), a Foreign Lender shall not be required
to deliver any form pursuant to this Section 2.16(e) that such Foreign Lender is
not legally able to deliver.
(f) If the Administrative Agent or a Lender determines, in its sole
discretion, that it has received a refund of any Indemnified Taxes or Other
Taxes as to which it has been
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indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to this Section 2.16, it shall promptly notify the
Borrower of such refund and promptly pay over such refund to the Borrower (but
only to the extent of indemnity payments made, or additional amounts paid, by
the Borrower under this Section 2.16 with respect to the Taxes or Other Taxes
giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent or such Lender and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund); provided, that the Borrower, upon the request of the Administrative
Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent or such Lender in the event the
Administrative Agent or such Lender is required to repay such refund to such
Governmental Authority. This Section shall not be construed to require the
Administrative Agent or any Lender to make available its tax returns (or any
other information relating to its taxes which it deems confidential) to the
Borrower or any other Person.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of L/C
Disbursements, or of amounts payable under Section 2.14, 2.15 or 2.16, or
otherwise) prior to 12:00 noon, New York City time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx, except payments to be made directly to the Issuing Bank or
Swingline Lenders as expressly provided herein and except that payments pursuant
to Sections 2.14, 2.15, 2.16, and 9.03 shall be made directly to the Persons
entitled thereto. The Administrative Agent shall distribute any such payments
received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) Except for payments and other amounts received by the
Administrative Agent and applied in accordance with the provisions of paragraph
(f) of this Section 2.17, all payments and other amounts received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed L/C Disbursements, interest, fees and other Obligations then due
hereunder shall be applied (i) first, towards payment of interest and fees then
due hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, (ii) second, towards
payment of principal and unreimbursed L/C Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed L/C Disbursements then due to such parties and (iii)
third towards payment of any other Obligations then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of Obligations then
due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in L/C Disbursements or Swingline
Loans resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and participations in L/C
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Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
and participations in L/C Disbursements and Swingline Loans of other Lenders to
the extent necessary so that the benefit of all such payments shall be shared by
the Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in L/C
Disbursements and Swingline Loans; provided that (i) if any such participations
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph (c) of this Section 2.17 shall not be construed to
apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or participations in L/C Disbursements to any assignee or participant,
other than to the Borrower or any Subsidiary or Affiliate thereof (as to which
the provisions of this paragraph (c) of this of this Section 2.17 shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Bank hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing Bank,
as the case may be, the amount due. In such event, if the Borrower has not in
fact made such payment, then each of the Lenders or the Issuing Bank, as the
case may be, severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender or Issuing Bank with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b) or 2.17(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender's obligations under
such Sections until all such unsatisfied obligations are fully paid.
(f) The Borrower hereby irrevocably waives the right to direct the
application of any and all payments in respect of the Secured Obligations and
any proceeds of Collateral after the occurrence and during the continuance of an
Event of Default and agrees that, notwithstanding the provisions of Sections
2.10(b) and 2.17(b), the Administrative Agent may, and, upon either (A) the
written direction of the Required Lenders or (B) the acceleration of the
Obligations pursuant to Article VII, shall apply all payments in respect of any
Secured Obligations and all proceeds of Collateral in the following order:
(i) first, to pay interest on and then principal of any portion of
the Revolving Loans that the Administrative Agent may have advanced on
behalf of any Lender for
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which the Administrative Agent has not then been reimbursed by such Lender
or the Borrower;
(ii) second, to pay interest on and then principal of any Swingline
Loan;
(iii) third, to pay Obligations in respect of any expense
reimbursements or indemnities then due to the Administrative Agent and the
Co-Syndication Agents;
(iv) fourth, to pay Obligations in respect of any expense
reimbursements or indemnities then due to the Lenders and the Issuing Bank;
(v) fifth, to pay Obligations in respect of any fees then due to
the Administrative Agent and the Co-Syndication Agents, the Lenders and the
Issuing Bank;
(vi) sixth, to pay interest then due and payable in respect of the
Loans and L/C Disbursements;
(vii) seventh, to pay or prepay principal amounts on the Loans and
L/C Disbursements, to provide cash collateral for outstanding undrawn
Letters of Credit in the manner described in Section 2.05(j) and to pay
Hedging Obligations owing to any Hedging Creditor and Cash Management
Obligations owing to any Secured Party, ratably to the aggregate principal
amount of such Loans, L/C Disbursements and undrawn Letters of Credit,
Hedging Obligations and Cash Management Obligations; and
(viii) eighth, to the ratable payment of all other Secured
Obligations;
provided, however, that if sufficient funds are not available to fund all
payments to be made in respect of any Secured Obligation described in any of
clauses (i) through (viii) above, the available funds being applied with respect
to any such Secured Obligation (unless otherwise specified in such clause) shall
be allocated to the payment of such Secured Obligations ratably, based on the
proportion of the Administrative Agent's, each Co-Syndication Agent's and each
Lender's, each Hedging Creditor's, the Issuing Bank's and each other holder of a
Secured Obligation's interest in the aggregate outstanding Secured Obligations
described in such clauses. The order of priority set forth in clauses (i)
through (viii) above may at any time and from time to time be changed by the
agreement of the Required Lenders and, to the extent that each Class is not
equally affected thereby, with the additional agreement of the Required Class
Lenders with respect to each affected Class, without necessity of notice to or
consent of or approval by the Borrower, any Secured Party that is not a Lender
or Issuing Bank or by any other Person that is not a Lender or Issuing Bank. The
order of priority set forth in clauses (i) through (v) above may be changed only
with the prior written consent of the Administrative Agent in addition to that
of the Required Lenders. The order of priority set forth in clauses (i) and (ii)
above may be changed only with the prior written consent of the Swingline
Lenders in addition to that of the Required Lenders and the Administrative
Agent.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.14, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16 or as a result
of any Lender's assignment to an Affiliate of such Lender or an Approved Fund
pursuant to Section 9.04(b), or if any Lender is an Affected Lender, then
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such Lender shall, upon the request of the Borrower, use reasonable efforts to
designate a different lending office for funding or booking its Loans or Letters
of Credit hereunder or to assign its rights and obligations hereunder to another
of its offices, branches or Affiliates, if such designation or assignment (i)
would be reasonably expected to eliminate or reduce amounts payable pursuant to
Sections 2.14 or 2.16 in the future or result in such Lender or its assignee, as
applicable, not being an Affected Lender; and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender. The Borrower hereby agrees to pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.
(b) If (i) any Lender requests compensation under Section 2.14, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.16 or
as a result of any Lender's assignment to an Affiliate of such Lender or an
Approved Fund pursuant to Section 9.04(b), or (ii) any Lender is a Non-Funding
Lender or (iii) any Lender has failed to consent to a proposed amendment,
waiver, discharge or termination which pursuant to the terms of this agreement
or any other Loan Document requires the consent of all of the Lenders or of any
Class of Lenders and with respect to which the Required Lenders or the Required
Class Lenders, as applicable, shall have granted their consent (provided that
for the purposes of this clause (iii), each of the percentages specified in the
definitions of "Required Lenders" and "Required Class Lenders" shall be deemed,
in each such case, to be increased to 75% and each such definition shall be
construed accordingly), then the Borrower may, at its sole expense and effort
(other than in the case of a default by a non-funding Lender, in which case such
Lender shall be responsible for all reasonable out-of-pocket costs of the
Borrower), upon notice to such Lender and the Administrative Agent, (x) prepay
such Lender in full or (y) require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee selected by the Borrower and approved by the Administrative Agent
(such approval not be unreasonably withheld or delayed) in accordance with
Section 9.04, that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans and participations in L/C Disbursements and Swingline Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (ii)
in the case of any such assignment resulting from a claim for compensation under
Section 2.14 or payments required to be made pursuant to Section 2.16, such
assignment would be reasonably expected to result in a reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as
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now conducted and is qualified to do business in, and is in good standing in,
every jurisdiction where such qualification is required except, in each case,
where the failure to do so, individually or in the aggregate, has not resulted,
and would not reasonably be expected to result, in a Material Adverse Effect.
Each Subsidiary of the Borrower is and shall be directly-owned by the Borrower,
except (i) Subsidiaries, all the outstanding capital stock of which is subject
to a first priority perfected pledge in favor of the Administrative Agent to
secure the Secured Obligations and (ii) certain inactive Subsidiaries holding de
minimis assets as set forth on Schedule 3.01. As of the date hereof, the
Borrower has no Subsidiaries other than those Persons listed on Schedule 3.01.
SECTION 3.02. Authorization; Enforceability. The Loan Documents and
the transactions contemplated thereby are within the Borrower's corporate powers
and have been duly authorized by all necessary corporate and, if required,
stockholder action on the part of the Borrower. Each of this Agreement and the
other Loan Documents has been duly executed and delivered by the Borrower and
constitutes a legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts; Ranking.
(a) The Transactions and the Related Documents:
(i) do not require any consent or approval of, registration or filing
with, or any other action by, any Governmental Authority, except such as
have been obtained or made and are in full force and effect and except as
have not resulted, and would not reasonably be expected to result, in a
Material Adverse Effect;
(ii) do not violate any applicable law (including ERISA and
Environmental Laws) or regulation or any order of any Governmental
Authority except as have not resulted, and would not reasonably be expected
to result, in a Material Adverse Effect;
(iii) do not violate the charter, by-laws or other organizational
documents of the Borrower or any of its Subsidiaries;
(iv) will not violate any indenture, agreement or other instrument
binding upon the Borrower or any of its Subsidiaries or its assets, or give
rise to a right thereunder to require any payment to be made by the
Borrower or any of its Subsidiaries except as has not resulted, and would
not reasonably be expected to result, in a Material Adverse Effect; and
(v) will not result in the creation or imposition of any Lien (except
any Lien permitted by Section 6.02) on any asset of the Borrower or any of
its Subsidiaries.
(b) Each Loan ranks pari passu in right of payment with each other
Loan (except as provided herein) and, for bankruptcy purposes, with all
other unsubordinated, non-credit enhanced and unsecured Indebtedness of the
Borrower.
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SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders its consolidated balance sheet
and statements of income, stockholders' equity and cash flows (i) for the fiscal
years ending, and at December 29, 2001 and December 28, 2002, and (ii) as of and
for the fiscal quarter and the portion of the fiscal year ended March 29, 2003.
The financial statements described in clause (i) of this Section 3.04(a) were
reported on by PricewaterhouseCoopers LLP for the fiscal years ending, and at,
December 29, 2001 and December 28 2002, and in clause (ii) of this Section
3.04(a) were certified by the Borrower's chief financial officer. Such financial
statements present fairly, in all material respects, the financial position and
results of operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such dates and for such periods in conformity with GAAP,
subject to year-end audit adjustments and the absence of footnotes in the case
of the statements referred to in clause (ii) above of this Section 3.04(a). The
Borrower has heretofore also furnished to the Lenders its unaudited pro forma
condensed consolidated statement of income, for its fiscal year ended December
28, 2002, and for its fiscal quarter ended March 29, 2003 and its unaudited pro
forma condensed consolidated balance sheet at March 29, 2003. Such pro forma
financial statements comply, in all material respects, with the requirements of
Article XI of Regulation S-X of the SEC.
(b) The Borrower has heretofore furnished to the Lenders projections
as of and for the period between fiscal year beginning 2003 and fiscal year
ended 2007. Such projections were prepared by management of the Borrower in good
faith based on assumptions that the Executive Officers believe are reasonable as
of the date hereof.
(c) Since December 28, 2002, there has been no change, occurrence or
development that has had or could reasonably be expected to have a material
adverse effect on the business, operations, properties, assets, liabilities or
condition (financial or otherwise) of the Borrower and its Subsidiaries, taken
as a whole.
SECTION 3.05. Properties; Insurance. (a) Each of the Borrower and its
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to their business, taken as a whole, except for
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties for their intended
purposes.
(b) Each of the Borrower and its Subsidiaries owns, is validly
licensed or otherwise has the right to use, all trademarks, trade names,
copyrights, patents and other intellectual property and property rights which
are material to its business, and the use thereof by the Borrower and its
Subsidiaries does not and will not violate the rights of any other Person,
except for any such violations that, individually or in the aggregate, has not
resulted, and would not reasonably be expected to result, in a Material Adverse
Effect. No claim is pending and, to the knowledge of the Executive Officers, no
claim has been asserted by any person challenging or questioning the use of any
such trademark, trade name, copyright, patent or other intellectual property or
proprietary rights except as has not resulted, and would not reasonably be
expected to result, in a Material Adverse Effect.
(c) The Borrower maintains, with financially sound and reputable
insurance companies, on its own behalf and on behalf of its Subsidiaries,
insurance in such amounts and against such risks as are customarily maintained
by companies engaged in the same or similar businesses operating in the same or
similar locations.
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SECTION 3.06. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Executive Officers,
threatened against or affecting the Borrower or any of its Subsidiaries that (i)
would reasonably be expected to be adversely determined, and (ii) if so
determined either (x) would reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect or (y) seek to enjoin, unwind
or otherwise materially and adversely affect this Agreement or the Transactions.
(b) Except with respect to matters that, individually or in the
aggregate, do not, and would not reasonably be expected to, result a Material
Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed
to comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability or (iii) has received written
notice of any claim with respect to any Environmental Liability.
SECTION 3.07. Compliance with Laws and Agreements; No Default. (a)
Each of the Borrower and its Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its property, except where the failure to do so, individually or in the
aggregate, has not resulted, and would not reasonably be expected to result, in
a Material Adverse Effect.
(b) As of the Closing Date and on each other date required by Section
4.02, no Default has occurred and is continuing.
SECTION 3.08. Investment and Holding Company Status. Neither the
Borrower nor any of its Subsidiaries 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.
SECTION 3.09. Taxes. Each of the Borrower and its Subsidiaries (i) has
timely filed or caused to be filed all Tax returns and reports required to have
been filed and (ii) has paid or caused to be paid all Taxes required to have
been paid by it, except in the case of each of clauses (i) and (ii) of this
Section 3.09, (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary, as applicable, has
set aside on its books reserves to the extent required under GAAP or (b) to the
extent that the failure to do so has not resulted, and would not reasonably be
expected to result, in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, has resulted, or could
reasonably be expected to result, in a Material Adverse Effect. The Borrower and
its ERISA Affiliates have fulfilled their respective obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code and have not incurred any liability to the PBGC
(other than to make contributions, pay annual PBGC premiums or pay out benefits
in the ordinary course of business) and none of the foregoing have resulted, or
would reasonably be expected to result, in a Material Adverse Effect.
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SECTION 3.11. Employee Matters. Neither the Borrower nor its
Subsidiaries is engaged in any unfair labor practice that has resulted, or would
reasonably be expected to result, in a Material Adverse Effect. There is, as of
the Closing Date and as of the date on which the initial Loans are advanced
hereunder, (a) no unfair labor practice complaint pending against the Borrower
or any of its Subsidiaries, or to the best knowledge of the Executive Officers,
threatened against any of them before the National Labor Relations Board and no
grievance or arbitration proceeding arising out of or under any collective
bargaining agreement that is so pending against the Borrower or any of its
Subsidiaries or to the best knowledge of the Executive Officers, threatened
against any of them, (b) no strike or work stoppage is in existence involving
the Borrower or any of its Subsidiaries that has had, or would reasonably be
expected to have, a Material Adverse Effect, and (c) to the best knowledge of
the Executive Officers, no union representation question is existing with
respect to the employees of the Borrower or any of its Subsidiaries and, to the
best knowledge of the Executive Officers, no union organization activity that is
taking place, except (with respect to any matters specified in clauses (a), (b)
or (c) of this Section 3.11, either individually or in the aggregate) such
matter as has not resulted, and would not reasonably be expected to result, in a
Material Adverse Effect.
SECTION 3.12. Transactions and Related Documents. (a) The terms and
conditions of the Spin-Off, payment of the Merck Dividend, the Notes Offering
and the Securitization are or will be consistent with Schedule 3.12. The
Separation and Transition Agreements that will give effect to the Spin-Off are
substantially in the form reviewed prior to the date hereof by the Joint Lead
Arrangers, and none of the terms or conditions of such agreements shall be
amended, waived or otherwise modified in a manner that would, in the reasonable
judgment of the Joint Lead Arrangers, be materially adverse to the Lenders
without the consent of the Joint Lead Arrangers.
(b) Before and immediately after giving effect to the Spin-Off,
payment of the Merck Dividend, the Notes Offering and the Securitization, the
Related Documents are and will be in full force and effect and have not been and
will not be amended, modified or terminated except as permitted pursuant to
Sections 5.08 and 6.09.
SECTION 3.13. Margin Regulations. Neither the Borrower nor any of its
Subsidiaries is engaged principally, as one of its important activities, in the
business of extending credit for the purpose of carrying any margin stock (as
such term is defined in Regulation U of the Board as in effect from time to
time). No part of the proceeds of the Loans or Letters of Credit issued to the
Borrower will be used to purchase or carry any such margin stock or to extend
credit to others for the purpose of purchasing or carrying any such margin stock
in violation of the provisions of Regulations T, U or X (or any successor
regulations) of the Board.
SECTION 3.14. Certain Fees. No broker's or finder's fee or commission
will be payable with respect hereto or any of the transactions contemplated
hereby.
SECTION 3.15. Solvency. On the Closing Date, and immediately after
giving effect to the Spin-Off, payment of the Merck Dividend, the Notes Offering
and the Securitization, the Borrower and each Significant Subsidiary is and will
be Solvent.
SECTION 3.16. No Burdensome Restrictions. No laws, regulations and
orders of any Governmental Authority applicable to the Borrower or any
Subsidiary or any of their property and all indentures, agreements and other
instruments binding upon any of them have
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had, or could reasonably be expected to result in, individually or in the
aggregate, a Material Adverse Effect.
SECTION 3.17. Disclosure. The Borrower has disclosed to the Lenders
all agreements (including those related to Medicare and Medicaid), instruments
(including in the Spin-Off Registration Statement, the Notes Indenture and the
offering memorandum or prospectus with respect to the Notes Issuance and the
Securitization Documents) and corporate or other restrictions to which it or any
of its Subsidiaries is subject as of the date of this Agreement, and all other
matters known to the Executive Officers as of the date of this Agreement, that,
as of the date of this Agreement, they are aware, individually or in the
aggregate, has resulted, or would reasonably be expected to result, in a
Material Adverse Effect. To the knowledge of the Executive Officers, as of the
date of this Agreement, neither the Information Memorandum nor any of the other
reports, financial statements, projections, certificates or other information
furnished by or on behalf of the Borrower to the Administrative Agent or any
Lender in connection with the negotiation of this Agreement or delivered
hereunder (as modified or supplemented by other information so furnished), when
taken as a whole, contains any material misstatement of fact or omits to state
any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information or any forecast or opinion, the
Borrower represents only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time.
ARTICLE IV
Conditions
SECTION 4.01. Closing Date. The obligations of the Lenders to make
Loans and of the Issuing Bank to issue Letters of Credit hereunder shall be
subject to the satisfaction (or waiver in accordance with Section 9.02) of each
of the following conditions:
(a) The Administrative Agent (or its counsel) shall have received from
the Borrower, in each following case in form and substance satisfactory to the
Administrative Agent and the Lead Arrangers:
(i) this Agreement, duly executed and delivered by the
Borrower and, for the account of each Lender requesting the same, one or
more Promissory Notes of the Borrower conforming to the requirements set
forth herein
(ii) the Pledge Agreement, duly executed by the Borrower,
together with each of the following:
(A) evidence satisfactory to the Administrative
Agent that, upon the filing and recording of instruments delivered at
the Closing Date and satisfaction of the requirements of clause (B)
below, the Administrative Agent (for the benefit of the Secured
Parties) shall have a valid and perfected first priority security
interest in the Collateral, including (x) such documents duly executed
by the Borrower as the Administrative Agent may request with respect
to the perfection of its security interests in the Collateral
(including financing statements under the UCC) and (y) copies of UCC
search reports as of a recent date listing all effective financing
statements that name the Borrower as debtor,
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together with copies of such financing statements, none of which
shall cover the Collateral except for those that shall be
terminated on the Closing Date or are otherwise permitted
hereunder; and
(B) share certificates representing all of
the certificated Pledged Stock being pledged pursuant to such
Pledge Agreement and stock powers for such share certificates
executed in blank;
(iii) a favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Closing Date) of
Fried Xxxxx Xxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Borrower,
substantially in the form of Exhibit I. The Borrower hereby requests
such counsel to deliver such opinion.
(iv) a certificate, dated the Closing Date and
signed by the President, a Vice President or an Executive Officer of
the Borrower that:
(A) The Borrower is in compliance with the
conditions set forth in paragraphs (a) and (b) of Section 4.02;
and
(B) Each Person that has executed this
Agreement or any Loan Document is an elected or appointed officer
of the Borrower and is authorized to execute this Agreement and
each of the Loan Documents, as the case may be.
(v) a certificate from the chief financial officer
of the Borrower to the effect that, both as of the Closing Date and
immediately after giving effect to the Loans to be made on the Closing
Date, the Spin-Off, payment of the Merck Dividend, the Notes Offering
and the Securitization and to the payment of all estimated legal,
investment banking, accounting and other fees related thereto, the
Borrower and each Significant Subsidiary (but excluding in any event
the Securitization SPV) is and will be Solvent.
(vi) a copy of each Related Document, certified as
being complete and correct by the President, a Vice President or an
Executive Officer of the Borrower;
(vii) a copy of the articles or certificate of
incorporation (or equivalent organizational document) of the Borrower,
certified as of a recent date by the Secretary of State of the state
of organization of the Borrower, together with certificates of such
official attesting to the good standing of the Borrower;
(viii) a certificate of the Secretary or an Assistant
Secretary of the Borrower certifying (A) the names and true signatures
of each officer of the Borrower that has been authorized to execute
and deliver any Loan Document or other document required hereunder to
be executed and delivered by or on behalf of the Borrower, (B) the
by-laws (or equivalent organizational document) of the Borrower as in
effect on the date of such certification, (C) the resolutions of the
Borrower's board of directors approving and authorizing the execution,
delivery and performance of this Agreement and the other Loan
Documents to which it is a party and (D) that there have been no
changes in the certificate of incorporation (or equivalent
organizational document) of the Borrower
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from the certificate of incorporation (or equivalent organizational
document) delivered pursuant to paragraph (vii) above.
(ix) such other documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the
Borrower, its Subsidiaries, the Loan Documents or the Transactions that the
Administrative Agent shall reasonably request, all in form and substance
reasonably satisfactory to the Administrative Agent.
(b) The Administrative Agent or the Joint Lead Arrangers, as the case
may be, shall have received all costs, fees, expenses (including reasonable
out-of-pocket legal fees and expenses and the reasonable out-of-pocket fees and
expenses of appraisers, consultants and other advisors) and other compensation
then payable to the Administrative Agent, the Joint Lead Arrangers and the
Lenders, including pursuant to the Fee Letters.
(c) The Administrative Agent shall have received satisfactory
confirmation of the applicable public long-term ratings assigned to the
Facilities from S&P and Xxxxx'x for the Loans, which shall be no less than
"BBB-" and "Ba1", respectively, and with a stable or positive outlook.
(d) The Borrower shall (i) have received not less than approximately
$500,000,000 gross proceeds of the Notes Offering and (ii) have not less than
$100,000,000 of available cash from a combination of initial proceeds of the
Securitization and other cash on hand for the collective purpose of paying (when
aggregated with the proceeds of the Term Loans) up to $1,500,000,000 of the
Merck Dividend.
(e) The Administrative Agent and the Arrangers shall be satisfied that
an amount acceptable to them of trade payables of the Subsidiaries shall have
been transferred to, or otherwise assumed by, the Borrower.
(f) The Closing Date shall have occurred on or before the earlier of
(i) September 15, 2003 and (ii) the date which is [_] Business Days following
the date of this Agreement.
SECTION 4.02. Each Credit Event. The several obligation of each Lender
to make a Loan on the occasion of any Borrowing (including any Borrowing made on
the Closing Date), and of the Issuing Bank to issue, amend, renew or extend any
Letter of Credit (each a "Credit Event"), is subject to the satisfaction of the
following conditions (provided that, without limiting any other provision of
this Agreement, the condition set forth in paragraph (c) below shall not be
required to be satisfied on any date following the initial Credit Event):
(a) The representations and warranties of the Borrower set forth in
Article III of this Agreement shall be true and correct in all material respects
(except that, to the extent any such representation or warranty is qualified by
materiality or Material Adverse Effect, such representation or warranty shall be
true and correct in all respects) on and as of the date of such Credit Event, as
applicable, except to the extent expressly referring only to an earlier date.
(b) At the time of and immediately after giving effect to such Credit
Event, no Default shall have occurred and be continuing.
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(c) As of the Closing Date and as of the date of the initial Credit
Event, since December 28, 2002, there has been no change, occurrence or
development that has had or could reasonably be expected to have a material
adverse effect on the prospects of the Borrower and its Subsidiaries, taken as a
whole.
Each Credit Event shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a)
and (b) of this Section 4.02.
ARTICLE V
Affirmative Covenants
Until the Lenders' Total Commitments have expired or been terminated
and the principal of and interest on each Loan and all fees payable hereunder
shall have been paid in full and all Letters of Credit shall have expired or
terminated and all L/C Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:
SECTION 5.01. Financial Statements; Ratings Change and Other
Information. The Borrower will furnish to the Administrative Agent and each
Lender (as provided in Section 9.01):
(a) not later than the earlier of (i) 100 days after the end of each
fiscal year of the Borrower and (ii) 5 Business Days after the filing thereof
with the SEC, its audited consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows as of the end of and for such
year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by PricewaterhouseCoopers LLP or other
independent public accountants of recognized national standing (without a "going
concern" or like qualification or exception and without any qualification or
exception as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Borrower and its consolidated
Subsidiaries on a consolidated basis, as of such dates and for such periods, in
conformity with GAAP; provided that delivery within the time frame specified
above of copies of Borrower's Annual Report on Form 10-K filed with the SEC
shall satisfy the requirements of this paragraph (a) of this Section 5.01;
(b) not later than the earlier of (i) 55 days after the end of each of
the first three fiscal quarters of each fiscal year of the Borrower and (ii) 5
Business Days after the filing thereof with the SEC, its unaudited consolidated
balance sheet and related statements of operations, stockholders' equity and
cash flows as of the end of and for such fiscal quarter and the then elapsed
portion of the fiscal year, setting forth in each case in comparative form the
figures for the corresponding period or periods of (or, in the case of the
balance sheet, as of the end of) the previous fiscal year, all certified by one
of its Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Borrower and its
consolidated Subsidiaries on a consolidated basis, as of such dates and for such
periods, in conformity with GAAP, subject to normal year-end audit adjustments
and the absence of footnotes; provided that delivery within the time frame
specified above of copies of Borrower's Quarterly Report on Form 10-Q filed with
the SEC shall satisfy the requirements of this paragraph (b) of this Section
5.01;
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(c) concurrently with any delivery of financial statements under
paragraphs (a) or (b) of this Section 5.01, a certificate of a Financial Officer
of the Borrower (i) certifying as to whether the Financial Officer is aware of a
Default that has occurred and is continuing and, if a Default has occurred and
is continuing, specifying the details thereof and any action taken or proposed
to be taken with respect thereto, (ii) demonstrating, in reasonable detail,
compliance with the financial ratios or requirements set forth in Sections
6.01(B)(o) 6.03(c), 6.04(p), 6.06(f)(ii) and 6.10(a), (b) and (c) and (iii)
stating whether any change in GAAP or in the application thereof has occurred
since the date of the audited financial statements referred to in Section 3.04
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate;
(d) concurrently with any delivery of financial statements under
paragraph (a) of this Section 5.01, a certificate substantially in the form
attached as Exhibit J of the accounting firm that reported on such financial
statements (provided that such certificate may be limited to the extent required
by accounting rules or guidelines);
(e) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by the
Borrower or any Subsidiary with the SEC, or any Governmental Authority
succeeding to any or all of the functions of said Commission, or distributed by
the Borrower to its shareholders generally provided that such financial
statements and reports to shareholders shall be deemed delivered on the second
business day following the day on which they are filed with the SEC unless
actually delivered on an earlier date, as the case may be;
(f) as soon as practicable and in any event no later than 15 days
prior to the beginning of each fiscal year for the Borrower, a consolidated
financial forecast for such fiscal year, including a forecasted consolidated
balance sheet and forecasted consolidated statements of income and cash flows of
the Borrower and its Subsidiaries for such fiscal year, together with an
explanation of the principal assumptions on which such forecasts are based;
(g) promptly after any Executive Officer of the Borrower shall have
become aware that Xxxxx'x or S&P shall have announced a change in the rating
established or deemed to have been established for the Facilities, written
notice of such rating change; and
(h) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request.
SECTION 5.02. Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:
(a) any Executive Officer's becoming aware of any Default that has
occurred, unless the Borrower has previously provided such notification;
(b) any Executive Officer's becoming aware of the filing or
commencement of any action, suit or proceeding by or before any arbitrator or
Governmental Authority against or affecting the Borrower or any Affiliate
thereof and that such action, suit or proceeding, if adversely determined, would
reasonably be expected to result in a Material Adverse Effect;
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(c) any Executive Officer's becoming aware of the occurrence of any
ERISA Event that, alone or together with any other ERISA Events that have
occurred and are then outstanding, would reasonably be expected to result in
liability of the Borrower and its Subsidiaries in an aggregate amount exceeding
$5,000,000; and
(d) any Executive Officer's becoming aware of any other development
that the Financial Officer is aware results in, or would reasonably be expected
to result in, a Material Adverse Effect.
Each notice delivered under this Section 5.02 shall be accompanied by a
statement of an Executive Officer setting forth a description of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business (including agreements with Merck, including those
to be entered into in connection with the Spin-Off described in the Spin-Off
Registration Statement) except for failures to do so which, individually or
collectively, would not reasonably be expected to, result in a Material Adverse
Effect; provided that the foregoing shall not prohibit any transaction permitted
under Section 6.03.
SECTION 5.04. Payment of Obligations. The Borrower will, and will
cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, before the same shall become delinquent or in default, that, if not
paid, individually or collectively, would result, or would reasonably be
expected to result, in a Material Adverse Effect, except where (a) the validity
or amount thereof is being contested in good faith by appropriate proceedings
and (b) the Borrower or such Subsidiary has set aside on its books reserves with
respect thereto to the extent required under GAAP.
SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will,
and will cause each of its Subsidiaries to, keep and maintain all property
material to the conduct of their businesses in good working order and condition,
ordinary wear and tear excepted, except for failures that would not reasonably
be expected to, result in a Material Adverse Effect. The Borrower will maintain,
with financially sound and reputable insurance companies, directly, or through
Merck, on the Borrower's own behalf and on behalf of its Subsidiaries, insurance
in such amounts and against such risks as are customarily maintained by
companies engaged in the same or similar businesses operating in the same or
similar locations.
SECTION 5.06. Books and Records; Inspection Rights. The Borrower will,
and will cause each of its Subsidiaries to, keep proper books of record and
account in conformity with GAAP. The Borrower will, and will cause each of its
Subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender (which, in the case of any such representatives which are
accountants, shall be an accounting firm of nationally recognized standing which
is reasonably acceptable to the Borrower), upon reasonable prior notice and
without causing material disruption, and at the expense of the Administrative
Agent or such Lender, as applicable, to visit and inspect its properties, to
examine and make extracts from its books and records, and to discuss its
affairs, finances and condition with its officers and
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independent accountants, all at such reasonable times and as often as reasonably
requested (subject to confidentiality obligations of the Borrower or its
Subsidiaries).
SECTION 5.07. Compliance with Laws and Agreements. The Borrower will,
and will cause each of its Subsidiaries to, comply with all laws (including
ERISA and Environmental Law), rules, regulations and orders of any Governmental
Authority applicable to it or its property (including the Separation and
Transition Agreement and any other agreements to be entered into in connection
with the Spin-Off as described in the Spin-Off Registration Statement), except
where the failure to do so, individually or in the aggregate, would not
reasonably be expected to, result in a Material Adverse Effect.
SECTION 5.08. Spin-Off. The Spin-Off will be completed on terms and
conditions substantially as described in Schedule 3.12. The underwriting and
exchange agreements giving effect to the Spin-Off and the Separation and
Transition Agreements have been or will be executed and delivered substantially
as described in Schedule 3.12 and in the form reviewed prior to the Closing Date
by the Joint Lead Arrangers and in full force and effect without any defaults or
breaches thereunder that would cause any of the conditions to closing of the
Spin-Off not to be satisfied, and none of the terms or conditions of such
documentation shall be amended, waived or otherwise modified in a manner that
would, in the reasonable judgment of the Joint Lead Arrangers, be materially
adverse to the Lenders without the Joint Lead Arrangers' consent, provided,
however, that such documentation may be amended or modified, or (in the case of
the Managed Care Agreement) replaced with one or more other agreements which,
taken as a whole, are not materially less favorable to the Borrower, to the
extent that a Material Adverse Effect would not reasonably be expected to,
result therefrom.
SECTION 5.09. Use of Proceeds and Letters of Credit. The proceeds of
the Term Loan shall only, and up to $50,000,000 of the Revolving Loans may, be
used, together with proceeds from the Notes Offering, initial proceeds of the
Securitization and available cash (including from settlement of an intercompany
payable owed to the Borrower by Merck), to pay the Merck Dividend. The proceeds
of the Revolving Loans shall (except as provided above) be only used for the
Borrower's general corporate and working capital purposes. No part of the
proceeds of the Loans shall be used in violation of the restrictions set forth
in Sections 3.13 and 6.04(p). Letters of Credit will be issued only to support
the Borrower's general corporate and working capital purposes.
SECTION 5.10. Additional Collateral. To the extent not delivered to
the Administrative Agent on or before the Closing Date, the Borrower agrees to
(or cause each of its applicable Subsidiaries to) do promptly each of the
following:
(a) execute and deliver to the Administrative Agent such supplements,
and amendments to the Pledge Agreement (or, in the case of Equity Interests of
any Subsidiary of the Borrower that is not a Domestic Subsidiary, appropriate
foreign law pledge agreements) as the Administrative Agent deems necessary or
advisable in order to grant to the Administrative Agent, for the benefit of the
Secured Parties, a perfected first priority security interest in the Equity
Interests of such Subsidiary that are owned by the Borrower (and of any
Subsidiary that is not directly owned by the Borrower as contemplated in Section
3.01(i)) and requested to be pledged by the Administrative Agent; provided,
however, that, unless otherwise agreed by the Borrower and the Administrative
Agent, in no event shall such the Borrower be required to pledge in excess of
66% of the outstanding voting stock of any direct Subsidiary of the Borrower
that is not a
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Domestic Subsidiary or to pledge the Equity Interests of any Insurance
Subsidiary or the Securitization SPV.
(b) deliver to the Administrative Agent the certificates (if any)
representing such Equity Interests, together with in the case of such
certificated Equity Interests, undated stock powers endorsed in blank executed
and delivered by an officer of the Borrower; and
(c) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.
ARTICLE VI
Negative Covenants and Financial Covenants
Until the Lenders' Total Commitments have expired or terminated and
the principal of and interest on each Loan and all fees payable hereunder have
been paid in full and all Letters of Credit have expired or terminated and all
L/C Disbursements shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:
SECTION 6.01. Indebtedness. (A) Notwithstanding any other provision of
this Agreement, no Subsidiary shall voluntarily provide a Guarantee of
Indebtedness under the Notes Offering and the Borrower and its Subsidiaries
shall not take any action which would obligate any Subsidiary to provide a
Guarantee of Indebtedness of the Borrower (including under the Notes Offering)
without the prior written consent of the Required Lenders.
(B) The Borrower will not, and will not permit any Subsidiary to,
create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness existing on the date hereof and set forth in Schedule
6.01;
(b) the Obligations and any Guarantee thereof;
(c) the Indebtedness of the Borrower under the notes to be issued
pursuant to the Notes Offering in an aggregate principal amount not exceeding
$500,000,000;
(d) Indebtedness under the Securitization, provided that the aggregate
principal component of amounts outstanding thereunder shall not, in the
aggregate exceed $500,000,000 (regardless of the amount of accounts receivable
securitized or collateralized thereunder) provided that, following consummation
of the Transactions, the Securitization Documents may be amended (in accordance
with the other provisions of this Agreement) to increase such aggregate
principal component to an amount not exceeding $750,000,000 (provided that no
Default is outstanding as of the date of such amendment or would directly result
from giving effect to such amendment);
(e) Indebtedness under intercompany loans made by the Borrower to any
of its Subsidiaries to the extent permitted by Section 6.04(c) or by any
Subsidiary to the Borrower or any other Subsidiary of the Borrower; provided
that any loan made by the Borrower shall be evidenced by a promissory note and
pledged to the Administrative Agent to secure the Secured Obligations;
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(f) Guarantees by (i) the Borrower with respect to Indebtedness of any
Subsidiary and (ii) by any Subsidiary with respect to Indebtedness of another
Subsidiary, in each case to the extent permitted by Section 6.04(c);
(g) Indebtedness of the Borrower as an account party in respect of
letters of credit, provided, that the aggregate amount thereof shall not at any
time exceed $25,000,000;
(h) Indebtedness which may be deemed to exist with respect to Hedging
Contracts permitted by Section 6.05;
(i) Indebtedness which may be deemed to exist pursuant to any surety,
indemnity, appeal, performance and other obligations of like nature and
Guarantees and/or obligations as an account party in respect of the face amount
of letters of credit in respect thereof, in each case securing obligations not
constituting Indebtedness for borrowed money (including worker's compensation
claims, environmental remediation and other environmental matters and
obligations in connection with self-insurance or similar requirements) and
arising in the ordinary course of business of the Borrower and its Subsidiaries
provided that, the aggregate outstanding amount thereof with respect to
Subsidiaries shall not at any time exceed $50,000,000;
(j) Indebtedness that may exist in respect of deposits or payments
made by customers or clients of the Borrower and its Subsidiaries;
(k) Capital Lease Obligations and purchase money Indebtedness incurred
by the Borrower or any Subsidiary to finance the acquisition, construction,
refurbishment or improvement of fixed assets or capital; provided, however, that
the Capital Expenditure related thereto is otherwise permitted by Section
6.10(c) and that the aggregate outstanding principal amount of all such Capital
Lease Obligations and purchase money Indebtedness shall not at any time exceed
$75,000,000;
(l) Indebtedness (i) of the Borrower assumed by it as the result of it
acquiring an Acquired Business and Indebtedness of any such Acquired Business
that becomes a Subsidiary as a result of such acquisition and (ii) of the
Borrower constituting contingent obligations in respect of indemnification,
adjustment of purchase price, earn-out, deferred compensation and similar
obligations incurred in connection with its acquisition of an Acquired Business;
provided that (x) such acquisition is permitted by Section 6.04(p), (y) (in the
case of clause (i) only) such Indebtedness was not incurred in contemplation of
such acquisition and (z) the aggregate principal amount of all such Indebtedness
under this paragraph (l) shall not at any time exceed $100,000,000.
(m) the incurrence by the Borrower or any of its Subsidiaries of
Indebtedness arising from the honoring by a bank or other financial institution
of a check, draft or similar instrument (except in the case of daylight
overdrafts) drawn against insufficient funds in the ordinary course of business;
provided, however, that such Indebtedness is extinguished within five Business
Days of incurrence;
(n) Indebtedness owed to any Person providing property, casualty or
liability insurance to the Borrower or any Subsidiary of the Borrower, so long
as such Indebtedness shall not be in excess of the amount of the unpaid cost of,
and shall be incurred only to defer the cost
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of, such insurance for the year in which such Indebtedness is incurred and such
Indebtedness shall be outstanding only during such year;
(o) Indebtedness of the Borrower not otherwise permitted by paragraphs
(a) and (c) through (l) of this subsection 6.01(B), having terms which, when
taken as a whole, are not materially less favorable to the Lenders than those
contained in the Notes Offering (for which determination the Borrower may
consult with the Administrative Agent), the aggregate outstanding principal
amount of which, as of the date of any incurrence thereof, shall not exceed 10%
of Consolidated Net Tangible Assets;
(p) extensions, renewals or refinancings of Indebtedness under
paragraphs (a) and (c) through (l) of this subsection 6.01(B) so long as (i)
such Indebtedness ("Refinancing Indebtedness") is in an aggregate principal
amount not greater than the aggregate principal amount of, and unpaid interest
on, the Indebtedness being extended, renewed or refinanced plus the amount of
any premiums required to be paid thereon and fees and expenses associated
therewith, (ii) such Refinancing Indebtedness has a later or equal final
maturity and a longer or equal weighted average life than the Indebtedness being
extended, renewed or refinanced, (iii) the interest rate applicable to such
Refinancing Indebtedness shall be at a rate no higher than the rate applicable
to the Indebtedness that is the subject of the extension, renewal or refinancing
and (iv) any such Refinancing Indebtedness with respect to the Notes Offering
has terms which, when taken as a whole, are not materially less favorable to the
Lenders than those contained in the Notes Offering (for which determination
Borrower may consult with the Administrative Agent); and
(q) all premiums (if any), interest (including post-petition
interest), fees, expenses, indemnities, charges and additional or contingent
interest on obligations described in paragraphs(B)(a) through (p) of this
Section 6.01.
SECTION 6.02. Liens. The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any property
or asset now owned or hereafter acquired by it, or assign or sell any income or
revenues (including accounts receivable) or rights in respect of any thereof,
except:
(a) Liens Securing the Secured Obligations;
(b) Permitted Encumbrances;
(c) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the date hereof and set forth in Schedule 6.02 and
additions thereto (but not beyond the scope of the original Lien) and proceeds
and replacements thereof, provided that such Liens shall secure only those
obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;
(d) any Lien existing on any property or asset of the Borrower or any
Subsidiary prior to the acquisition thereof by the Borrower or any Subsidiary or
existing on any property or asset of any Person that becomes a Subsidiary of the
Borrower or is merged or consolidated with or into the Borrower or any of its
Subsidiaries (provided, that any such Subsidiary shall be directly owned by the
Borrower) after the date hereof prior to the time such Person becomes a
Subsidiary and additions thereto (but not beyond the scope of the original Lien)
and proceeds and
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replacements thereof; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming
a Subsidiary or being so merged or consolidated, as the case may be and (ii)
such Lien shall secure only those obligations which it secures on the date of
such acquisition or the date such Person becomes a Subsidiary or is so merged or
consolidated, as the case may be and extensions, renewals and replacements
thereof that do not increase the outstanding principal amount thereof;
(e) any Lien securing Indebtedness permitted pursuant to Section
6.01(B)(k), provided, that such Lien and the Indebtedness secured thereby are
incurred prior to or within 120 days after such acquisition or the completion of
such construction, refurbishment or improvement, (iii) the Indebtedness secured
thereby does not exceed 100% of the cost of acquiring, constructing or improving
such fixed or capital assets and (iv) such Liens shall not apply to any other
property or assets of the Borrower or any Subsidiary (other than proceeds and
replacements thereof and additions thereto (but not beyond the scope of the
original Lien));
(f) Liens solely on any deposits, advances, contractual payments,
including implementation allowances, or escrows made or paid by the Borrower or
any of its Subsidiaries to or with customers or clients in the ordinary course
of business;
(g) Liens arising pursuant to, or assignments in connection with, the
Securitization with respect to the Receivables and Related Assets securitized
thereunder;
(h) deposits securing liabilities to insurance carriers under
insurance or self-insurance arrangements and regulatory restrictions imposed on
insurance Subsidiaries;
(i) Liens of any Subsidiary in favor of the Borrower or any other
Subsidiary of the Borrower; and
(j) Liens not otherwise permitted by paragraphs (a) through (i) of
this Section 6.02 securing Indebtedness permitted by Section 6.01(B) in an
aggregate principal amount not to exceed at any time $50,000,000.
SECTION 6.03. Fundamental Changes; Asset Sales. The Borrower will
not, nor will it permit any of its Subsidiaries to, consummate any transaction
of merger or consolidation, or liquidate, wind-up or dissolve itself (or suffer
any liquidation or dissolution), or convey, sell, lease or sub-lease (as lessor
or sublessor), transfer or otherwise dispose of, in one transaction or a series
of transactions, all or any part of its business, assets or property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, or acquire by purchase or otherwise
(other than purchases or other acquisitions of inventory, materials and
equipment in the ordinary course of business) the business, property or fixed
assets of, or Equity Interests or other evidence of beneficial ownership of, any
Person or any division or line of business or other business unit of any Person,
except:
(a) any Subsidiary may be merged with or into the Borrower or another
wholly-owned Subsidiary, or be liquidated, wound up or dissolved, or all or any
part of its business, property or assets may be conveyed, sold, leased,
transferred or otherwise disposed of, in one transaction or a series of
transactions, to the Borrower or another wholly-owned Subsidiary; provided, in
the case of any merger with the Borrower, the Borrower will be the continuing or
surviving Person;
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(b) (i) sales, leases, subleases or the transfer of Receivables and
Related Assets (or interests therein) pursuant to the Securitization or (ii)
other dispositions of assets that do not constitute Asset Sales;
(c) (i) Asset Sales required by any Governmental Authority or (ii)
Asset Sales (excluding any sale of Receivables and Related Assets), the Net Cash
Proceeds of which, when aggregated with the Net Cash Proceeds of all other Asset
Sales made within the same fiscal year of the Borrower in reliance on this
clause (c), are less than $100,000,000 provided, that (1) in the case of an
Asset Sale not required by any Governmental Authority, the consideration
received for such assets shall be in an amount at least equal to the fair market
value thereof, (2) in the case of an Asset Sale not required by any Governmental
Authority, no less than 75% thereof shall be paid in cash or Permitted
Investments, and (3) the Net Cash Proceeds received from Asset Sales shall be
applied as, and, if and to the extent, required by Section 2.10(b);
(d) disposals of obsolete, worn out or surplus property, payments
under Indebtedness permitted by Section 6.01 and any Restricted Payment
permitted by Section 6.06;
(e) any Investment or acquisition permitted by Section 6.04 and any
Indebtedness permitted by Section 6.01;
(f) the Borrower and its Subsidiaries may liquidate or sell Permitted
Investments;
(g) any sale or disposition deemed to occur in connection with (i)
creating or granting any Lien permitted pursuant to Section 6.02 or (ii)
enforcing any such Lien by the sale or disposition of the assets pledged under
such Lien, to the extent such assets have a fair market value not in excess of
the Indebtedness secured by such Lien; and
(h) the Borrower or any of its Subsidiaries may dispose of machinery
or equipment for not less than fair market value which will be replaced or
upgraded with machinery or equipment put to a similar use and owned by such
Person; provided that such replacement or upgraded machinery and equipment is
acquired within 120 days after such disposition.
SECTION 6.04. Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, and will not permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a wholly-owned Subsidiary prior to such merger) any Equity
Interests, evidences of Indebtedness or other securities (including any option,
warrant or other right to acquire any of the foregoing) of, make or permit to
exist any loans or advances to, Guarantee any obligations of, transfer (by sale,
lease or otherwise) or contribute any asset (except Asset Sales and other
dispositions made on arms' length terms for fair market value) to, or make or
permit to exist any investment or any other similar interest in, any other
Person, or purchase or otherwise acquire (in one transaction or a series of
transactions) any assets of any other Person constituting a business unit (each
an "Investment"), except:
(a) Permitted Investments;
(b) Investments by the Borrower or any of its Subsidiaries that exist
on the date hereof and an Investment in any Person to the extent such Investment
replaces or refinances an Investment in such Person existing on the date hereof
in an amount not exceeding the amount of the Investment being replaced or
refinanced; provided that the new Investment is (i) on terms and
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conditions not materially less favorable, taken as a whole, to the Borrower and
its Subsidiaries than the Investment being renewed or replaced or (ii) is
otherwise permitted by this Section 6.03;
(c) Investments made after the date hereof (i) by the Borrower to or
in any Subsidiary (including Investments in the Equity Interests of any
wholly-owned Subsidiary newly organized or acquired after the date hereof,
provided, however, that any Subsidiary newly formed or acquired after the date
hereof shall be directly owned by the Borrower) which (x) are made to or in any
such Subsidiary to permit such Subsidiary to make (and are promptly applied in
full by such Subsidiary in making) Consolidated Capital Expenditures permitted
by Section 6.10(c) (y) are made to or in any such Subsidiary to permit such
Subsidiary to pay (and are promptly applied in full by such Subsidiary in
paying), or otherwise arise as a result of payment by the Borrower directly on
behalf of such Subsidiary of, operating expenses of such Subsidiary which arise
in the ordinary course of its business and (z) in the case of all other such
Investments not permitted by clauses (x) and (y), in aggregate do not exceed in
any fiscal year $50,000,000 (net of any cash dividends, distributions, interest,
repayments, redemptions, rental payments or other cash return on Investments
(excluding any intercompany loans made by any Subsidiary to the Borrower)
received by the Borrower after the date hereof from Investments in its
Subsidiaries); and (ii) by any Subsidiary to or in the Borrower or any other
wholly-owned Subsidiary, provided, however, that no such Investment pursuant to
this paragraph (c) shall be made to or in any Subsidiary unless all of the
Equity Interests of such Subsidiary are subject to a perfected first priority
pledge in favor of the Administrative Agent securing the Secured Obligations,
except Investments in any Insurance Subsidiary which are made (to the extent
necessary) to maintain minimum capital requirements under applicable law or
regulations;
(d) Guarantees constituting Indebtedness permitted by Section 6.01;
(e) any Investment acquired by any of Borrower or any of its
Subsidiaries (i) in exchange for any other Investment permitted under this
Section 6.04 or accounts receivable held by Borrower or any of its Subsidiaries
in connection with or as a result of a bankruptcy, workout, reorganization or
recapitalization of the issuer of such other Investment permitted under this
Section 6.04 or accounts receivable, (ii) as a result of a foreclosure by
Borrower or any of its Subsidiaries with respect to any secured Investment or
other transfer of title with respect to any secured Investment in default or
(iii) in connection with the acquisition of an Acquired Business of an
Investment of such Acquired Business which existed prior to the date of such
acquisition;
(f) any Investment that may be deemed to exist with respect to any
Swap Agreement permitted by Section 6.05;
(g) any acquisition, construction or lease of fixed or capital
assets, plants, facilities or equipment (including renewals, substitutions,
additions, refurbishments, replacements, capitalized repairs and improvements
during such period) that should be capitalized under GAAP, and included in
property, plant or equipment reflected on a consolidated balance sheet of the
Borrower and its Subsidiaries;
(h) acquisitions or Investments in exchange for Equity Interests in
the Borrower;
(i) loans, deposits or advances to or with customers and clients,
including extensions of trade credit by, receivables payable to, and
pre-payments of, the Borrower or any of its Subsidiaries, in the ordinary course
of business;
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(j) Investments to fund deferred compensation plans and other
post-employment benefit plans in the ordinary course of business; and
(k) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 6.03;
(l) Investments constituting loans, advances or extensions of credit
to employees, officers and directors made in the ordinary course of business
which do not violate Section 402 of the Xxxxxxxx-Xxxxx Act of 2002 (as amended);
provided that the aggregate outstanding amount thereof shall at no time exceed
$10,000,000;
(m) an Investment in the Securitization SPV pursuant to the
Securitization; provided that the only assets transferred to the Securitization
SPV consist of Receivables and Related Assets;
(n) deposits made in the ordinary course of business consistent with
past practices to secure the performance of leases;
(o) the Borrower may make contributions to an employee stock
ownership plan sponsored by it; provided that (i) such contributions are in
Equity Interests of the Borrower, and (ii) the Borrower may lend or contribute
money in an aggregate amount not exceeding (x) $50,000,000 in fiscal year 2003,
(y) $75,000,000 in fiscal year 2004 and (z) $100,000,000 in each fiscal year
thereafter, to an employee stock ownership plan sponsored by it to permit such
plan to immediately purchase Equity Interests of the Borrower from the Borrower
with the proceeds of such loan or contribution; provided, further that all
proceeds of any such loans or contributions shall at all times (A) be held by
the Borrower to be set-off in full against the consideration receivable by the
Borrower for issuance of such Equity Interests or (B) to the extent held by any
Person other than the Borrower, be held in a segregated deposit account in trust
for, or subject to a first priority perfected security interest in favor of, the
Borrower; and
(p) Investments and other acquisitions by the Borrower for cash not
otherwise permitted under paragraphs (a) through (o) of this Section 6.04 or
under Section 6.03 in an aggregate amount not exceeding $500,000,000 in any
fiscal year; provided, that the Borrower's ratio of Consolidated Total Debt to
Consolidated EBITDA for the period of four fiscal quarters ending on the last
day of the most recently ended fiscal quarter shall not exceed (x) in any event,
2.25:1 and (y) in the event that the aggregate amount of such Investments would
exceed $250,000,000 in any fiscal year, 1.50:1, in each case determined on a pro
forma basis giving effect to such Investments or acquisitions, provided however,
that (i) this paragraph (p) shall not permit Investments in or to Subsidiaries
in addition to those permitted pursuant to paragraph (c) of this Section 6.04
and (ii) no acquisition of any Acquired Business shall be permitted to be
financed (in whole or in part) with the proceeds of Loans or Letters of Credit
unless the board of directors (or the equivalent governing body) of such
proposed Acquired Business shall have consented to such acquisition. For the
avoidance of doubt, nothing contained in this paragraph (p) shall be interpreted
as modifying or superceding any financial requirement otherwise specified in
Section 6.10.
SECTION 6.05. Swap Agreements. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any Swap Agreement, except Hedging
Contracts entered into with any Hedging Creditor to hedge or mitigate bona fide
risks to the Borrower or such
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Subsidiary with respect to its business or assets which, in each case, is not
for speculative purposes.
SECTION 6.06. Restricted Payments. The Borrower will not, and will not
permit any of its Subsidiaries to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except (a) the Borrower may
declare and pay dividends with respect to its Equity Interests payable solely in
additional shares of its common stock, (b) Subsidiaries may declare and pay
dividends ratably with respect to their Equity Interests, (c) the Borrower may
declare and pay the Merck Dividend, (d) the Borrower may make Restricted
Payments pursuant to and in accordance with stock option plans or other benefit
plans for management or employees of the Borrower and its Subsidiaries, (e) the
Borrower may redeem, repurchase, retire, defease, or otherwise acquire any
Equity Interests of the Borrower in exchange for, or out of the net cash
proceeds of the sale (other than to a Subsidiary of the Borrower) within 30 days
of, Equity Interests of the Borrower; and (f) provided that no Default is
outstanding or would result therefrom, the Borrower may declare and pay cash
dividends and make other Restricted Payments with respect to its Equity
Interests if, at the time such dividend or other Restricted Payment is declared
or made (after giving effect thereto), the aggregate principal amount of the
cash dividends paid or other Restricted Payments made after the date hereof
(excluding the Merck Dividend) does not exceed (i) if, at the time of any such
Restricted Payment, the Facilities have a rating of at least "BBB-" and "Baa3"
from S&P and Xxxxx'x, respectively, the sum of $25,000,000 plus (in the case of
any such Restricted Payment made after December 31, 2003) 25% of Consolidated
Net Income for the period from June 30, 2003 until the last day of the then most
recently ended fiscal quarter and (ii) if, at the time of any such Restricted
Payment, the Facilities do not have both the ratings specified in clause (i) or
better, (x) in fiscal year 2003, $25,000,000, (y) in fiscal year 2004, the sum
of $25,000,000 plus any portion pursuant to clause (x) which is unused for
fiscal year 2003 and (z) in each fiscal year thereafter, the sum of $25,000,000
plus 25% of Consolidated Net Income for the previous fiscal year; provided that
(A) any such portion of Consolidated Net Income applied in making Restricted
Payments pursuant to this clause (z) shall be up to an amount equal to the
portion of Excess Cash Flow for the previous fiscal year which is not required
to be applied in prepayment of the Loans pursuant to Section 2.10, (B) no such
portion of Consolidated Net Income may be so applied pursuant to this clause (z)
if the Borrower's ratio of Consolidated Total Debt to Consolidated EBITDA for
the period of four fiscal quarters ending on the last day of the then most
recently ended fiscal quarter, exceeds 1.5:1 and (C) no such Restricted Payments
made pursuant to this clause (z) shall in aggregate exceed $100,000,000 in any
fiscal year.
SECTION 6.07. Transactions with Affiliates. (a) The Borrower will
not, and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with, any
of its Affiliates, except (i) on terms and conditions not in the aggregate less
favorable to the Borrower or such Subsidiary than could be obtained on an
arm's-length basis if the Affiliate were an unrelated third party, (ii) pursuant
to the Separation and Transition Agreements entered into in connection with or
prior to the Spin-Off (as described in the Spin-Off Registration Statement
unless such agreement would not be material to the Borrower and its
Subsidiaries, taken as a whole, as of the date of the Spin-Off Registration
Statement), (iii) transactions (x) between the Borrower and its wholly-owned
Subsidiaries (provided, that all of the Equity Interests of each such Subsidiary
are subject to a perfected first priority pledge in favor of the Administrative
Agent securing the Secured Obligations) or (y) between wholly-owned Subsidiaries
of the Borrower (provided, that all of the Equity Interests of each such
Subsidiary are
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subject to a perfected first priority pledge in favor of the Administrative
Agent securing the Secured Obligations) and (iv) any Restricted Payment
permitted by Section 6.06.
(b) The foregoing paragraph (a) of this Section 6.07 shall not
prohibit, to the extent otherwise permitted under this Agreement, (i) any
issuance of securities, or other payments, awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment arrangements, stock
options and other benefit plans, (ii) loans or advances to employees, officers,
consultants or directors of the Borrower or any Subsidiary permitted by Section
6.04, (iii) the payment of fees and indemnities to directors, officers and
employees of the Borrower and the Subsidiaries in the ordinary course of
business, (iv) any agreements with employees and directors entered into by the
Borrower or any of its Subsidiaries in the ordinary course of business, (v)
sales of Equity Interests of the Borrower to its Affiliates, (vi) the
Securitization and transfers of Receivables and Related Assets (or interests
therein) pursuant to the terms of the Securitization Documents and (vii) the
entering into of any agreement with an Affiliate filed with the SEC as an
exhibit to the Spin-Off Registration Statement, the subsequent amendment from
time to time of any such agreement in a manner not materially less favorable,
taken as a whole, to the Borrower or its Subsidiaries or the performance by the
Borrower or any of its Subsidiaries of any such agreement in accordance with its
terms, as initially entered or as so amended.
SECTION 6.08. Restrictive Agreements. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of the Borrower or any Subsidiary
to create, incur or permit to exist any Lien upon any of its property or assets,
or (b) the ability of any Subsidiary to pay dividends or other distributions
with respect to its Equity Interests or to make or repay loans or advances to
the Borrower or to Guarantee Indebtedness of the Borrower; provided that (i) the
foregoing shall not apply to restrictions and conditions imposed by law, rule,
regulation or order (in each case, having the force of law), by this Agreement,
by the terms of the notes to be issued in the Notes Offering or by the
Securitization Documents with respect to the Securitization SPV and/or any
Receivables and Related Assets securitized thereunder, (ii) the foregoing shall
not apply to restrictions and conditions existing on the date hereof identified
on Schedule 6.08 (but shall apply to any extension, renewal, amendment or
modification thereof which materially expands the scope of such restrictions or
conditions, taken as a whole), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale or
disposition of any assets or Subsidiary provided such sale or disposition is
permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to any Lien
permitted by this Agreement if the restrictions or conditions do not apply to
any property or assets other than the property or asset subject to such Lien,
(v) clause (a) of the foregoing shall not apply to customary provisions in
leases (including prohibitions contained therein on a Lien on the lease or the
property subject to the lease) and other contracts (including restrictions on
assignment), (vi) the foregoing shall not apply to regulatory restrictions and
conditions imposed on insurance Subsidiaries of the Borrower, (vii) the
foregoing shall not apply to restrictions contained in any instrument governing
Indebtedness or Equity Interests of a Person acquired by the Borrower or any of
its Subsidiaries as in effect at the time of such acquisition (except to the
extent such Indebtedness was incurred, or such Equity Interests were issued, in
connection with or in contemplation of such acquisition), which encumbrance or
restriction is not applicable to any Person, or the properties or assets of any
Person, other than the Person or the property or assets of the Person so
acquired, and any amendments, modifications, restatements, renewals,
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increases, supplements, refundings, replacements or refinancings of those
instruments, provided that the encumbrances or restrictions contained in any
such amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings, taken as a whole, are not materially
more restrictive than the encumbrances or restrictions contained in instruments
as in effect on the date of acquisition, (viii) the foregoing shall not apply to
restrictions on cash or other deposits or net worth imposed by customers or
lessors under contracts or leases entered into in the ordinary course of
business, (ix) the foregoing shall not apply to customary restrictions imposed
on the transfer of copyrighted or patented materials or other intellectual
property and customary provisions in agreements that restrict the assignment of
such agreements or any rights thereunder, and (x) the foregoing shall not apply
to any restrictions imposed by contracts or leases entered into in the ordinary
course of business by any Person acquired by the Borrower or any of its
Subsidiaries with such Person's customers, lessors or suppliers and not in
connection with or in contemplation of the acquisition of such Person by the
Borrower or such Subsidiary of the Borrower, which restrictions are not
applicable to any Person, or the property or assets of any Person, other than
the property or assets of the Person so acquired.
SECTION 6.09. Prepayments or Redemptions of Indebtedness; Amendments
to Related Documents. (a) The Borrower will not, nor will it permit any of its
Subsidiaries to, (i) prepay, redeem, purchase, retire, defease, or otherwise
acquire any Subordinated Indebtedness or Indebtedness under the Notes Offering,
or make any payment in violation of any subordination terms of any Subordinated
Indebtedness, except (x) with the proceeds of Refinancing Indebtedness permitted
by Section 6.01(p) and (y) that the Borrower may prepay, redeem, purchase,
retire, defease, or otherwise acquire any Subordinated Indebtedness of the
Borrower or any of its Subsidiaries or Indebtedness under the Notes Offering in
exchange for, or out of the net cash proceeds of the sale within 30 days (other
than to a Subsidiary of the Borrower) of, Equity Interests of the Borrower, or
(ii) amend or otherwise change the terms of any Subordinated Indebtedness or
Indebtedness under the Notes Offering (including, without limitation, any
Refinancing Indebtedness with respect to any of the foregoing permitted by
Section 6.01(B)(p)), or make any payment required by such amendment thereof or
change thereto, if the effect of such amendment or change is to increase the
interest rate on such Indebtedness, change (to earlier dates) any dates upon
which payments of principal or interest are due thereon, change any event of
default or condition to an event of default with respect thereto (other than to
eliminate any such event of default or increase any grace period related
thereto), change the redemption, prepayment or defeasance provisions thereof,
change the subordination provisions of any Subordinated Indebtedness (or of any
guarantee thereof), or if such amendment or change, together with all other
amendments or changes made, would materially and adversely affect the interests
of the Lenders.
(b) The Borrower will not, nor will it permit any of its Subsidiaries
to, alter, rescind, terminate, amend, supplement, waive or otherwise modify any
provision of the Related Documents except for modifications that (i) do not
materially and adversely affect the rights and privileges of the Borrower or any
of its Subsidiaries under the Separation and Transition Agreement and (ii) do
not materially and adversely affect the interests of the Lenders.
SECTION 6.10. Financial Covenants. (a) Leverage Covenant. The
Borrower will not, and will not permit any of its Subsidiaries to, permit the
ratio of (i) Consolidated Total Debt as of the last day of any fiscal quarter,
or as of the date of any Credit Event (after giving effect thereto), to (ii)
Consolidated EBITDA for the last four fiscal quarters ending on or before such
date to be greater than 2.25:1.
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(b) Fixed Charge Coverage Covenant. The Borrower will not permit
the ratio, determined as of the last day of any fiscal quarter for the period of
four fiscal quarters ending on such day, of (i) Consolidated EBITDA for such
period minus Consolidated Capital Expenditures made or incurred in cash during
such period to (ii) Consolidated Fixed Charges for such period to be less than
3.0:1
(c) Capital Expenditures Covenant. The Borrower and its
Subsidiaries shall not make or incur, or permit to be made or incurred,
Consolidated Capital Expenditures in aggregate exceeding $250,000,000 in any
fiscal year, provided, however, that to the extent that actual Consolidated
Capital Expenditures for any such fiscal year shall in the aggregate be less
than $250,000,000 for such fiscal year (without giving effect to the carryover
permitted by this proviso), 100% of the difference between $250,000,000 and such
actual Consolidated Capital Expenditures shall, in addition, be available for
incurrence of Consolidated Capital Expenditures in the next succeeding fiscal
year. In addition, the Borrower and its Subsidiaries shall be permitted to make
or incur Consolidated Capital Expenditures in an aggregate amount not to exceed
$175,000,000 solely for the purposes of providing facilities which are necessary
to the fulfillment by the Borrower and its Subsidiaries of new or additional
services to be provided under any contract entered into by the Borrower or any
of its Subsidiaries with the Centers for Medicare and Medicaid Services (or
another equivalent federal governmental agency, or its designee) on or after the
Closing Date to provide prescription drug benefit management services for
Medicare eligible persons. For the purposes of calculating Consolidated Capital
Expenditures under this paragraph (c), the following shall not be included: (i)
Consolidated Capital Expenditures to the extent financed with the Net Cash
Proceeds of Asset Sales and proceeds of casualty insurance policies and
condemnation awards (in each case to the extent permitted to be so applied
pursuant to Section 2.10(b)) and (ii) Investments constituting acquisitions of
any Acquired Business made pursuant to Section 6.04(p).
(d) In calculating the ratios set forth in Sections 6.10(a) and
(b), pro forma effect shall be given to any acquisitions or dispositions that
occur during the applicable reference period, or thereafter and on or prior to
the reporting date with respect thereto, as if they had occurred on the first
day of the applicable reference period or as of the last day of the applicable
quarter, as the case may be.
ARTICLE VII
Events of Default
If any of the following events (each an "Event of Default") shall
occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of 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 otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in paragraph (a) of
this Article VII) payable under this Agreement or any Loan Documents, when and
as the same shall become due and payable, and such failure shall continue
unremedied for a period of five days;
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(c) any representation or warranty made or deemed made by or on
behalf of the Borrower or any Subsidiary in or in connection with this Agreement
or any amendment or modification hereof or waiver hereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or in
connection with this Agreement or any amendment or modification hereof or waiver
hereunder, shall prove to have been incorrect in any material respect (except
that, to the extent any such representation or warranty is qualified by
materiality or Material Adverse Effect, such representation or warranty shall
prove to have been incorrect in any respect) when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Sections 5.03 (with respect to the
Borrower's existence), 5.08 or in Article VI;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement or any other Loan Document
(other than those specified in paragraph (a), (b) or (d) of this Article VII)
and such failure shall continue unremedied for a period of 30 days after notice
thereof from the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender);
(f) the Borrower or any Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity, other than at the
election of the Borrower or any Subsidiary, or that, subject to any applicable
grace period, enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material Indebtedness or any
trustee or agent on its or their behalf to cause any Material Indebtedness to
become due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity; provided that this paragraph (g) shall
not apply to secured Indebtedness that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Indebtedness;
(h) (i) the closing of the Spin-Off has not been completed, in
accordance with Scection 3.12 by [ ], 2003 or (ii) once the Merck Dividend shall
have been declared and become due and payable, the Borrower shall have
insufficient available cash (when aggregated with all proceeds available for
such purpose received by the Borrower from issuance of the Notes Offering, the
Securitization, the Loans (to the extent permitted to be so applied pursuant to
Section 5.09) and settlement of an intercompany receivable owed to the Borrower
by Merck) to pay the Merck Dividend in full, or the Borrower shall fail to pay
the Merck Dividend in full, on the date on which such payment is due;
(i) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any Significant Subsidiary or the debts thereof,
or a substantial part of the assets thereof, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Significant Subsidiary
or for a substantial part of the
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assets thereof, and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or ordering any
of the foregoing shall be entered;
(j) the Borrower or any Significant Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation, reorganization
or other relief under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in paragraph (h) of this Article VII, (iii)
apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Significant Subsidiary or for a substantial part of its assets, (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 or
(vi) take any action for the purpose of effecting any of the foregoing;
(k) the Borrower or any Significant Subsidiary shall become unable,
admit in writing its inability or fail generally to pay its debts as they become
due;
(l) one or more judgments (i) for the payment of money in an
aggregate amount in excess of $25,000,000 (except to the extent covered by
insurance or other right of reimbursement or indemnification), or (ii) which
result, or would reasonably be expected to result, in a Material Adverse Effect,
shall be rendered against the Borrower, any Subsidiary or any combination
thereof and the same shall remain undischarged for a period of 60 consecutive
days during which execution shall not be effectively stayed or bonded pending
appeal;
(m) an ERISA Event shall have occurred and shall be outstanding that,
when taken together with all other ERISA Events that have occurred and are then
outstanding, would reasonably be expected to result in liability of the Borrower
and its Subsidiaries in an aggregate amount exceeding $25,000,000, individually
or in the aggregate;
(n) any of the following shall occur:
(i) the Managed Care Agreement does not remain in full force
and effect (unless replaced by a substantially equivalent agreement or
series of agreements which is not materially less favorable to the Borrower
than the Managed Care Agreement);
(ii) the Borrower shall have breached, on one or more occasions,
its obligations under the Managed Care Agreement;
(iii) the Managed Care Agreement shall be amended; or
(iv) Merck exercises its privilege to withdraw its products from
the terms of the Managed Care Agreement;
and any such failure to remain in full force and effect, breach, amendment
or withdrawal individually or in the aggregate, results, or could be
reasonably expected to result, in a Material Adverse Effect; provided,
however, that, under this Agreement, in determining whether or not a
Material Adverse Effect could be reasonably expected to result from such
termination, breach, amendment or withdrawal consideration shall be given
by the
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parties to any attempt to mitigate the effects of such termination, breach,
amendment or withdrawal;
(o) a Change in Control shall occur; or
(p) any provision of any Collateral Document after delivery thereof
pursuant to this Agreement or any other Loan Document shall for any reason cease
to be valid and binding on, or enforceable against, the Borrower, or the
Borrower shall so state in writing or any Collateral Document shall for any
reason fail or cease to create a valid Lien on any Collateral purported to be
covered thereby or, except as permitted by the Loan Documents, such Lien shall
fail or cease to be a perfected and first priority Lien or the Borrower shall so
state in writing,
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (i) or (j) of this Article VII), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Borrower,
take either or both of the following actions, at the same or different times:
(i) terminate the Lenders' Total Commitments, and thereupon such Total
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
Obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in paragraph (i) or (j) of this Article VII,
the Lenders' Total Commitments shall automatically terminate and the principal
of the Loans then outstanding, together with accrued interest thereon and all
fees and other Obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower. In
addition to the remedies set forth above, the Administrative Agent may exercise
any remedies provided for by the Collateral Documents in accordance with the
terms thereof or any other remedies provided by applicable law.
ARTICLE VIII
The Administrative Agent
(a) Each of the Lenders and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms hereof, together with such
actions and powers as are reasonably incidental thereto. Without limiting the
foregoing, each Lender and the Issuing Bank hereby authorize the Administrative
Agent to execute and deliver, and to perform its obligations under, each of the
Loan Documents to which the Administrative Agent is a party, to exercise all
rights, powers and remedies that the Administrative Agent may have under such
Loan Documents and, in the case of the Collateral Documents, to act as agent for
the Lenders, the Issuing Bank and the other Secured Parties under such
Collateral Documents.
(b) The bank serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
bank and its Affiliates may accept deposits
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from, lend money to and generally engage in any kind of business with the
Borrower or any Subsidiary or other Affiliate thereof as if it were not the
Administrative Agent hereunder.
(c) The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (i) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (ii) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (iii) except as expressly set
forth herein, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to the
Borrower or any of its Subsidiaries that is communicated to or obtained by the
bank serving as Administrative Agent or any of its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or in the absence of its own gross
negligence or willful misconduct. The Administrative Agent shall be deemed not
to have knowledge of any Default unless and until written notice thereof is
given to the Administrative Agent by the Borrower or a Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (v) any statement, warranty or representation made in or in
connection with this Agreement, (w) the contents of any certificate, report or
other document delivered hereunder or in connection herewith, (x) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth herein, (y) the validity, enforceability, effectiveness or
genuineness of this Agreement or any other agreement, instrument or document, or
(z) the satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.
(d) The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to be
genuine and to have been signed or sent by the proper Person. The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any
liability for relying thereon. The Administrative Agent may consult with legal
counsel (who may be counsel for the Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.
(e) The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
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(f) Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders, the Issuing Bank and the Borrower.
Upon any such resignation, the Required Lenders shall have the right to appoint
a successor, subject to the approval of the Borrower not to be unreasonably
withheld so long as the Borrower is not then in Default. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent, subject
to the approval of the Borrower not to be unreasonably withheld so long as the
Borrower is not then in Default, which shall be a bank with an office in New
York, New York, or an Affiliate of any such bank. Upon the acceptance of its
appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder. The fees
payable by the Borrower to a successor Administrative Agent shall be the same as
those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.
(g) Each Lender acknowledges that it has, independently and without
reliance upon the Administrative 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
Administrative 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,
any related agreement or any document furnished hereunder or thereunder.
(h) Each Lender and the Issuing Bank agree that any action taken by
the Administrative Agent or the Required Lenders (or, where required by the
express terms of this Agreement, a greater proportion of the Lenders) in
accordance with the provisions of this Agreement or of the other Loan Documents,
and the exercise by the Administrative Agent or the Required Lenders (or, where
so required, such greater proportion) of the powers set forth herein or therein,
together with such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders, the Issuing Bank and other
Secured Parties. Without limiting the generality of the foregoing, the
Administrative Agent shall have the sole and exclusive right and authority to
(i) act as the disbursing and collecting agent for the Lenders and the Issuing
Bank with respect to all payments and collections arising in connection herewith
and with the Collateral Documents, (ii) execute and deliver each Collateral
Document and accept delivery of each such agreement delivered by the Borrower or
any of its Subsidiaries, (iii) act as collateral agent for the Lenders, the
Issuing Bank and the other Secured Parties for purposes of the perfection of all
security interests and Liens created by such agreements and all other purposes
stated therein, provided, however, that the Administrative Agent hereby
appoints, authorizes and directs each Lender and the Issuing Bank to act as
collateral sub-agent for the Administrative Agent, the Lenders and the Issuing
Bank for purposes of the perfection of all security interests and Liens with
respect to the Borrower's and its Subsidiaries' respective Deposit Accounts
maintained with, and cash and Cash Equivalents held by, such Lender or the
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Issuing Bank, (iv) manage, supervise and otherwise deal with the Collateral, (v)
take such action as is necessary or desirable to maintain the perfection and
priority of the security interests and Liens created or purported to be created
by the Collateral Documents and (vi) except as may be otherwise specifically
restricted by the terms hereof or of any other Loan Document, exercise all
remedies given to the Administrative Agent, the Lenders, the Issuing Bank and
the other Secured Parties with respect to the Collateral under the Loan
Documents relating thereto, applicable law or otherwise.
(i) Each of the Lenders and the Issuing Bank hereby direct, in
accordance with the terms hereof, the Administrative Agent to release (or, in
the case of clause Error! Reference source not found. Error! Reference source
not found., release or subordinate) any Lien held by the Administrative Agent
for the benefit of the Lenders and the Issuing Bank against any of the
following:
(i) all of the Collateral, upon termination of the
Commitments and payment and satisfaction in full of all Loans, L/C Exposure
and all other Obligations that the Administrative Agent has been notified
in writing are then due and payable (and, in respect of contingent L/C
Exposure, with respect to which cash collateral has been deposited or a
back-up letter of credit has been issued, in either case on terms
satisfactory to the Administrative Agent and the Issuing Bank);
(ii) any assets that are subject to a Lien permitted by
Section 6.01(B)(k); and
(iii) any part of the Collateral sold or disposed of by the
Borrower if such sale or disposition is permitted by this Agreement (or
permitted pursuant to a waiver or consent of a transaction otherwise
prohibited by this Agreement).
(j) Each of the Lenders and the Issuing Bank hereby direct the
Administrative Agent to execute and deliver or file such termination and partial
release statements and do such other things as are necessary to release Liens to
be released pursuant to this Article VIII promptly upon the effectiveness of any
such release.
(k) Each Joint Lead Arranger and each Co-Syndication Agent (except in
its capacity as a Lender) shall not have, and shall not by reason of being named
in this Agreement be deemed to have, any obligations under this Agreement.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:
(i) if to the Borrower, to it at 000 Xxxxxxx Xxxx Xxxxx, Xxxxxxxx
Xxxxx, Xxx Xxxxxx 00000, Attention of Chief Financial Officer (Telecopy No.
(000) 000-0000);
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(ii) if to the Administrative Agent, to JPMorgan Chase Bank, Loan and
Agency Services Group, 0000 Xxxxxx, Xxxxx 00, Xxxxxxx, XX 00000, Attention
of Xxxxx Xxxxx/Xxxxxxxx Xxxxxxx (Telecopy No. (000) 000 0000/2782), with a
copy to JPMorgan Chase Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Xxxx Xxx Xxx (Telecopy No. (000) 000-0000);
(iii) if to the Issuing Bank, to JPMorgan Chase Bank, Standby Letters
of Credit Department, 00000 Xxxxxxxx Xxxxx Xxxxx, Xxxxx, XX, 00000,
Attention of [Xxxxxxx Xxxxx (Telecopy No. 000-000-0000 or 813-432-5162)],
with a copy to JPMorgan Chase Bank, Loan and Agency Services Group, One
Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of
Xxxx Xxx Xxx (Telecopy No. (000) 000-0000);
(iv) if to the Swingline Lenders, to (x) JPMorgan Chase Bank, Loan
and Agency Services Group, 0000 Xxxxxx, Xxxxx 00, Xxxxxxx, XX 00000,
Attention of Xxxxx Xxxxx/Xxxxxxxx Xxxxxxx (Telecopy No. (713) 750
2949/2782), with a copy to JPMorgan Chase Bank, 000 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention of Xxxx Xxx Xxx (Telecopy No. (000) 000-0000) and
(y) Citicorp North America, Inc., 000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention of [ ] (Telecopy No.[ ]); and
(v) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications, and not by telecopy,
pursuant to procedures approved by the Administrative Agent and financial
statements required to be furnished hereunder by the Borrower may be furnished
by means of posting to an IntraLinks site to which the Administrative Agent and
each Lender has been granted access; provided that the foregoing shall not apply
to notices pursuant to Article II unless otherwise agreed by the Administrative
Agent and the applicable Lender. The Administrative Agent or the Borrower may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications, and not by telecopy, pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. 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 earlier of (i) date of receipt and (ii) (if applicable) three
Business Days following the sending thereof by registered mail.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power 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 Administrative Agent, the Issuing Bank and the Lenders
hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
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and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall (i) increase any Commitment of any Lender without the
written consent of such Lender, (ii) increase the maximum aggregate amount of
Swing Line Loans or L/C Exposure permitted to be outstanding hereunder without
the written consent of the Required Class Lenders under the Revolving Credit
Facility and (in the case of such increase to the maximum aggregate amount of
L/C Exposure) the Issuing Bank, (iii) reduce the principal amount of any Loan or
L/C Disbursement or reduce the rate of interest thereon (other than a waiver of
default interest arising under Section 2.12(c)), or reduce any fees payable
hereunder, without the written consent of each Lender affected thereby, (iv)
postpone the Maturity Date or the scheduled date of payment of any interest on
any Loan, or any fees payable hereunder, or reduce the amount of, waive or
excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby, (v)
change Section 2.17(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender
affected thereby, (vi) release all or substantially all of the Collateral,
change any of the provisions of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender; provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent, the Issuing
Bank or the Swingline Lenders hereunder without the prior written consent of the
Administrative Agent, the Issuing Bank or the Swingline Lenders, as the case may
be, or (vii) change the allocation between any optional or mandatory prepayments
of Term Loans and Revolving Loans, without the written consent of the applicable
Required Class Lenders affected thereby; provided, further, that the
Administrative Agent and the Borrower may, with the consent of the other, amend,
modify or supplement this Agreement to cure any ambiguity, typographical error,
defect or inconsistency, so long as such amendment, modification or supplement
does not adversely affect the rights of any Lender or any Issuing Bank.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Joint Lead Arrangers, the Co-Syndication Agents and
each Related Party of any of the foregoing Persons, including the reasonable
fees, charges and disbursements of counsel, expenses incurred in connection with
due diligence and travel, courier, reproduction, printing and delivery expenses
and expenses related to the use of IntraLinks) of the Joint Lead Arrangers and
the Co-Syndication Agents in connection with the arrangement and syndication of
the credit facilities provided for herein, the preparation, execution, delivery
and administration of this Agreement or any amendments, waivers, modifications,
waivers or extensions (including amendments, waivers, modifications or
extensions proposed by the Borrower) of the provisions hereof (whether or not
the transactions contemplated hereby or thereby shall be consummated), provided
that the Borrower shall not be required (except in connection with the primary
syndication of Term B
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Commitments and the Term B Loans) to pay any fees and expenses incurred by the
Administrative Agent, the Joint Lead Arrangers, the Co-Syndication Agents, any
Lender or any other Related Parties incurred in connection with an assignment or
participation of any rights or obligations of a Lender hereunder unless
initiated by the Borrower under Section 2.19(b) other than as a result of a
default by the Lender; and (ii) all reasonable out-of-pocket expenses incurred
by the Issuing Bank (without duplication of amounts described in Section 2.12)
in connection with the issuance, amendment, waiver, modification, extension or
renewal (including proposed amendments, waivers, modifications, extensions or
renewals) of any Letter of Credit or any demand for payment thereunder and (iii)
all out-of-pocket expenses incurred by the Administrative Agent, the Issuing
Bank, any Lender, the Joint Lead Arrangers or the Co-Syndication Agents,
including the fees, charges and disbursements of any counsel for the
Administrative Agent, the Issuing Bank, any Lender, the Joint Lead Arrangers or
the Co-Syndication Agents, in connection with the enforcement or protection of
its rights under and in connection with this Agreement or the Loan Documents,
including its rights under this Section or in connection with the Loans made or
Letters of Credit issued hereunder, including all such out-of-pocket expenses
incurred in connection with any workout proceedings, enforcement costs and
documentary taxes or negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent, the Issuing
Bank, each Lender, the Joint Lead Arrangers and the Co-Syndication Agents, and
each Related Party of any of the foregoing Persons (each such Person being
called an "Indemnitee") against, and hold each Indemnitee harmless from, any and
all reasonable out-of pocket costs, losses, claims, damages, liabilities and
related expenses, including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with any actual or threatened third-party claim,
litigation, investigation or proceeding (a "Third-Party Claim"), whether based
on contract, tort or any other theory and regardless of whether any Indemnitee
is a party thereto, relating to (i) the execution or delivery of this Agreement
or any agreement or instrument contemplated hereby, the performance by the
parties hereto of their respective obligations hereunder or the consummation of
the Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
the Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit) or (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned or operated by the
Borrower or any of its Subsidiaries, or any Environmental Liability related in
any way to the Borrower or any of its Subsidiaries; provided that the foregoing
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 judgment to have resulted from the
gross negligence, willful misconduct or bad faith of such Indemnitee. Upon
receipt of notice of any Third-Party Claim, the Indemnitee shall promptly notify
the Borrower thereof. The Borrower, in its sole discretion, upon written notice
of the Indemnitee(s), may elect to defend (or may at any time assume the defense
of) and may, with the consent of the Indemnitee(s) (such consent not to be
unreasonably withheld), settle or compromise any such Third-Party Claim, using
counsel appointed by Borrower, which counsel shall be reasonably satisfactory to
the Indemnitee if such settlement or compromise would result in the full release
of Indemnitee from any liability arising thereof, or with the consent of the
Indemnitee (not to be unreasonably withheld). No Indemnitee may compromise or
settle or consent to the entry of judgment or determination of liability with
respect to a Third-Party Claim for which it is seeking indemnification hereof,
without the consent of Borrower.
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(c) To the extent that the Borrower fails to pay any amount required
to be paid by it to the Administrative Agent, the Issuing Bank or the Swingline
Lenders under paragraph (a) or (b) of this Section, (i) each Lender severally
agrees to pay to the Administrative Agent and (ii) each Revolving Lender
severally agrees to pay to the Issuing Bank or the Swingline Lenders, as the
case may be, respectively, such Lender's Applicable Percentage with respect to
the Facilities and such Revolving Lender's Applicable Percentage with respect to
the Revolving Credit Facility (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such respective unpaid
amounts; provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or
asserted against the Administrative Agent, the Issuing Bank or any Swingline
Lender in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable promptly after
written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that (i)
the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
such attempted assignment or transfer by the Borrower without such consent shall
be null and void) and (ii) no Lender may assign or otherwise transfer its rights
or obligations hereunder except in accordance with this Section. Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby (including any Affiliate of the Issuing Bank that issues any
Letter of Credit), Participants (to the extent provided in paragraph (c) of this
Section) and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent, the Issuing Bank and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Total Commitments and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that no consent of the Borrower
shall be required for an assignment to a Lender, an Affiliate of a Lender,
an Approved Fund (as defined below) or, if an Event of Default under
paragraph (a), (b), (h) or (i) of Article VII has occurred and is
continuing, any other assignee; and
(B) the Administrative Agent, provided that no consent of the
Administrative Agent shall be required for an assignment (i) with respect
to any Term Loan, to an assignee that is a Lender, an Affiliate of a Lender
or a Federal Reserve Bank,
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immediately prior to giving effect to such assignment or (ii) with respect
to the Revolving Credit Facility, to an assignee that is a Lender under the
Revolving Credit Facility.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining amount of
the assigning Lender's Total Commitment, the amount of the Total Commitment
of the assigning Lender subject to each such assignment (determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $1,000,000
unless each of the Borrower and the Administrative Agent otherwise consent,
provided that no such consent of the Borrower shall be required if an Event
of Default under paragraph (a), (b), (h) or (i) of Article VII has occurred
and is continuing;
(B) each partial assignment shall be made as an assignment
of a proportionate part of all an assigning Lender's rights and obligations
under this Agreement; provided that this Section 9.04(b)(ii)(B) shall not
be construed to prohibit assignment of a proportionate part of all such
assigning Lender's rights and obligations in respect of one Class of Loans
(or commitments to make any such Loans);
(C) the parties to each assignment shall execute and deliver
to the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500;/1/
(D) the assignee, if it is not an existing Lender, shall
deliver to the Administrative Agent an Administrative Questionnaire; and
(E) in the case of an assignment to a CLO (as defined
below), the assigning Lender shall retain the sole right to approve any
amendment, modification or waiver of any provision of this Agreement,
provided that the Assignment and Assumption between such Lender and such
CLO may provide that such Lender will not, without the consent of such CLO,
agree to any amendment, modification or waiver described in the first
proviso to Section 9.02(b) that affects such CLO.
For the purposes of this Section 9.04(b), the terms "Approved Fund"
and "CLO" have the following meanings:
"Approved Fund" means (a) a CLO 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.
"CLO" means any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or
otherwise investing in bank
----------------------
/1/ Any exceptions to be determined.
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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.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section 9.04, from and after the effective date
specified in each Assignment and Assumption the assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Assumption, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Assumption covering all of the assigning Lender's 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 2.14,
2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section
9.04 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section 9.04.
(iv) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Total
Commitment of, and principal amount of the Loans and L/C Disbursements
owing to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the
Borrower, the Administrative 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,
notwithstanding notice to the contrary. 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.
(v) Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph
(b)(ii)(C) of this Section 9.04 and any written consent to such assignment
required by paragraph (b)(i) of this Section 9.04, the Administrative Agent
shall accept such Assignment and Assumption and record the information
contained therein in the Register. No assignment shall be effective for
purposes of this Agreement unless it has been recorded in the Register as
provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower, the
Administrative Agent, the Issuing Bank or the Swingline Lenders, sell
participations to one or more banks or other entities (a "Participant") in all
or a portion of such Lender's rights and obligations under this Agreement
(including all or a portion of its Total Commitment and the Loans owing to it);
provided that (A) such Lender's obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations arising from such participations
so sold by such Lender and (C) the Borrower, the Administrative Agent, the
Issuing Bank and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and obligations under
this Agreement. Any agreement or instrument pursuant to which a Lender sells
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such a participation shall provide that such Lender shall retain the sole right
to enforce this Agreement and to approve any amendment, modification or waiver
of any provision of this Agreement; provided that such agreement or instrument
may provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. Subject to paragraph (c)(ii) of
this Section 9.04, the Borrower agrees that each Participant shall be entitled
to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were
a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this Section 9.04. To the extent permitted by law, each Participant also
shall be entitled to the benefits of Section 9.08 as though it were a Lender,
provided that such Participant agrees to be subject to Section 2.17(c) as though
it were a Lender.
(ii) A Participant shall not be entitled to receive any greater
payment under Sections 2.14, 2.15 or 2.16 than the applicable Lender would
have been entitled to receive with respect to the participation sold to
such Participant, unless the sale of the participation to such Participant
is made with the Borrower's prior written consent. A Participant that would
be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 2.16 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.16(e) and (f) as though
it were a Lender.
(d) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to
any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.
SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, 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 is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written,
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relating to the subject matter hereof. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held
to be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates 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) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, 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
9.08 are in addition to other rights and remedies (including other rights of
setoff) which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the United
States District Court of the Southern District of New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement, 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 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 Administrative Agent,
the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against the Borrower or its properties in
the courts of any jurisdiction.
(c) The Borrower 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 in any court referred to
in paragraph (b) of this Section. 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.
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(d) Each party to this Agreement irrevocably 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.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY AND THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) 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 (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. (a) Subject as provided in
paragraph (b) below, each of the Administrative Agent, the Issuing Bank and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (i) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (ii) to the extent requested
by any regulatory authority, (iii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (iv) to any other party
to this Agreement, (v) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (vi) subject to an agreement containing provisions
substantially the same as those of this Section, to (x) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (y) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (vii) with the consent of the Borrower or
(viii) to the extent such Information (x) becomes publicly available other than
as a result of a breach of this Section 9.12 or (y) becomes available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
from a source other than the Borrower or any of its Affiliates. For the purposes
of this paragraph, "Information" means all information received from the
Borrower or any of its Affiliates relating to the Borrower or its business in
connection with the facilities for the Loans in connection with the performance
by the Administrative Agent, Issuing Bank and the Lenders, other than any such
information that is available to the Administrative Agent, the Issuing Bank or
any Lender on a nonconfidential basis prior to disclosure by the Borrower or any
of its Affiliates; provided that, in the case of information received from the
Borrower after the date hereof, such information is clearly identified at the
time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this paragraph shall
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be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
Notwithstanding the foregoing, nothing in this paragraph shall be deemed to (1)
restrict or affect the rights or ability of the Administrative Agent, the
Issuing Bank or the Lenders to comply with all applicable disclosure laws,
regulations and principles in connection with the Spin-Off, the Notes Offering
or related transactions, (2) restrict the ability of the Administrative Agent,
the Issuing Bank or the Lenders to share information with underwriters
participating in the Spin-Off, the Notes Offering or related transactions, (3)
prevent the Administrative Agent, the Issuing Bank or the Lenders from retaining
documents or other information in connection with due diligence, including any
documents or other information disclosed to the Administrative Agent, the
Issuing Bank or the Lenders in connection with the transactions contemplated
hereby, (4) restrict or affect the rights or ability of the Administrative
Agent, the Issuing Bank or the Lenders to use any such documents or other
information in investigating or defending itself against allegations or claims
made or threatened by purchasers, regulatory authorities or others in connection
with the Spin-Off, the Notes Offering or related transactions, or (5) prevent
the Administrative Agent, the Issuing Bank or the Lenders from disclosing any
confidential information required to be disclosed by an applicable statute,
rule, regulation or other legal requirement in connection with or arising out of
the Spin-Off, the Notes Offering or related transactions.
(b) Notwithstanding the provisions of Section 9.12(a) or
anything to the contrary set forth herein, each party to this Agreement (and
each of their respective employees, representatives or other agents) may
disclose to any and all persons, without limitations of any kind, the tax
treatment and tax structure of the Transactions and all materials of any kind
(including opinions and other tax analyses) that are provided to any such party
relating to such party's tax treatment and tax structure. However, any
information relating to the tax treatment or tax structure shall remain subject
to the confidentiality provisions hereof (and the foregoing sentence shall not
apply) to the extent reasonably necessary to enable the parties hereto, their
respective Affiliates, and their and their respective Affiliates' directors and
employees to comply with applicable securities laws. For this purpose, "tax
structure" means any facts relevant to the federal income tax treatment of the
Transactions but does not include information relating to the identity of any of
the parties hereto or any of their respective Affiliates.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the day and
year first above written.
MEDCO HEALTH SOLUTIONS, INC.
By _________________________
Name:
Title:
JPMORGAN CHASE BANK, individually and
as Administrative Agent,
By _________________________
Name:
Title:
[OTHER BANKS],
By _________________________
Name:
Title:
