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TERM LOAN AGREEMENT
Dated as of November __, 1995
among
Ford Holdings, Inc.,
Ford Motor Company
and
[Name of Bank]
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-TABLE OF CONTENTS-
SECTION 1. DEFINITIONS 1
SECTION 2. THE LOANS 3
2.1 TERM LOANS 3
2.2 PROCEEDS OF THE LOANS 4
2.3 NOTICES OF BORROWING 4
2.4 EXTENSION OF LOANS 4
2.5 INTEREST RATES 5
2.6 INTEREST PAYMENT DATES 5
2.7 OVERDUE INTEREST 5
2.8 DATES FOR PAYMENT OR OPTIONAL PREPAYMENT OF PRINCIPAL 6
2.9 OPTIONAL PREPAYMENT ON OTHER DATES; REIMBURSEMENT FOR CERTAIN COSTS 6
2.10 METHOD OF PAYMENT 6
SECTION 3. THE GUARANTEE 6
SECTION 4. CONDITIONS TO THE LOANS 7
4.1 EACH LOAN 7
4.2 FIRST LOAN 8
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE BORROWER AND GUARANTOR 9
5.1 CORPORATE AUTHORITY OF THE BORROWER AND GUARANTOR, ETC. 9
5.2 FINANCIAL STATEMENTS 10
5.3 LITIGATION 11
5.4 USE OF PROCEEDS 11
5.5 COMPLIANCE WITH ERISA 12
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SECTION 6. COVENANTS OF THE GUARANTOR 12
6.1 LIMITATION ON LIENS 12
6.2 LIMITATION ON SALES AND LEASEBACKS 13
6.3 MERGERS AND CONSOLIDATIONS 14
6.4 ADDITIONAL COVENANTS 14
6.5 ERISA 14
6.6 NOTIFICATION 15
SECTION 7. DEFAULT 15
SECTION 8. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE BANK 16
8.1 ACQUISITION OF THE NOTE 16
8.2 ASSIGNMENT; PARTICIPATION 16
SECTION 9. CHANGES IN CIRCUMSTANCES 17
9.1 ILLEGALITY 17
9.2 INCREASED COST 18
SECTION 10. MISCELLANEOUS 19
10.1 NOTICES 19
10.2 TERM OF AGREEMENT 20
10.3 NO WAIVERS 20
10.4 NEW YORK LAW AND JURISDICTION 20
10.5 ENTIRE AGREEMENT 21
10.6 PAYMENT OF CERTAIN EXPENSES 21
10.7 CHANGES, WAIVERS, ETC. 21
10.8 SEVERABILITY 21
10.9 SUCCESSORS AND ASSIGNS 21
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10.10 COUNTERPARTS 22
10.11 ELECTRONIC RECORDING 22
EXHIBIT A PROMISSORY NOTE
EXHIBIT B NOTICE OF BORROWING/EXTENSION
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TERM LOAN AGREEMENT
This TERM LOAN AGREEMENT, dated as of November __, 1995, is among FORD
HOLDINGS, INC., a Delaware corporation, Xxx Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx
00000 (the "Borrower"), FORD MOTOR COMPANY, a Delaware corporation, Xxx
Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000 (the "Guarantor"), and [NAME OF BANK,
nature of entity, address] (the "Bank").
For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS
The following terms, as used herein, have the following respective
meanings:
"Agreement" means this Term Loan Agreement, together with the exhibits
hereto, as amended from time to time.
"Attributable Debt" has the meaning set forth in Section 6.2.
"Bank's Actual Reserve Cost" has the meaning set forth in Section
9.2(b).
"Commitment" has the meaning set forth in Section 2.1(a).
"Consolidated Net Tangible Assets" means the aggregate amount of
assets (less applicable reserves and other properly deductible items) after
deducting therefrom (a) all current liabilities and (b) all goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other
like intangibles, all as set forth on the most recent balance sheet of the
Guarantor and its consolidated subsidiaries and computed in accordance with
generally accepted accounting principles in the United States.
"Debt" has the meaning set forth in Section 6.1.
"Domestic Business Day" means a day which is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized by law to
close.
"ERISA" means the Employee Retirement Income Security Act of 1974 of
the United States, as amended.
"Event of Default" has the meaning set forth in Section 7.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System of the United States, or any successor thereto.
"Funded Debt" has the meaning set forth in Section 6.2.
"Guarantee" means the guarantee and other obligations of the Guarantor
set forth in Section 3.
"Guaranteed Obligations" has the meaning set forth in Section 3.
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"Interest Period" means, with respect to each Loan,
(i) initially, the period commencing on the date of
borrowing of such Loan and ending one, two, three or six
months thereafter, as the Borrower may elect pursuant to
Section 2.3 or Section 2.4; and
(ii) thereafter, each period commencing on the last
day of the next preceding Interest Period for such Loan and
ending one, two, three or six months thereafter, as the
Borrower may elect pursuant to Section 2.4;
provided, however, that:
(A) any such Interest Period which would otherwise
end on a day which is not a LIBOR Business Day shall be
extended to the next succeeding LIBOR Business Day unless such
LIBOR Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding
LIBOR Business Day;
(B) any such Interest Period which begins on the last
LIBOR Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on a day
which is the last LIBOR Business Day of the applicable
calendar month; and
(C) the Borrower may not elect an Interest Period
that would end later than the Termination Date.
"LIBOR" means, for any Interest Period with respect to any Loan, [the
rate for deposits in United States dollars for a period equal to the Interest
Period for such Loan which appears on the Reuters Screen ISDA Page as of 11:00
a.m., London time, two LIBOR Business Days prior to the date of borrowing or
extension of such Loan, as the case may be; and "Reuters Screen ISDA Page"
means the display designated as page "ISDA" on the Reuters Monitor Money Rates
Service (or such other page as may replace the ISDA Page on that service for
the purpose of displaying London interbank offered rates for United States
dollar deposits). If for any reason such page or service is not available or
such applicable rate does not appear on such page or service on a date
necessary for determining the interest rate hereunder for an Interest Period,
then the Borrower and the Bank shall agree upon a mutually satisfactory
alternative arrangement for determining the equivalent of such rate. In
addition, if for any reason there is unusual volatility in the interbank market
such that on the date necessary for determining the interest rate hereunder
London interbank offered rates for United States dollar deposits are unusually
high, then the Borrower and the Bank shall agree upon a mutually satisfactory
alternative rate or an alternative type of Loan which may not necessarily
include the Margin.]
"LIBOR Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
United States dollar deposits) in London.
"Loan" or "Loans" means one or more borrowings of funds by the
Borrower from the Bank pursuant to Sections 2.1 and 2.3, as such Loans may be
extended from time to time pursuant to the provisions of Section 2.4.
"Manufacturing Subsidiary" means a subsidiary of the Guarantor which
owns or leases a Principal Domestic Manufacturing Property.
"Margin" means 3/25 of 1% (12 basis points).
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"Mortgage" and "Mortgages" have the meanings set forth in Section 6.1.
"Note" has the meaning set forth in Section 2.1(a).
"Notice Office" has the meaning set forth in Section 10.1.
"Participant" has the meaning set forth in Section 8.2.
"Plan" means an employee benefit plan or other plan (other than a
multi-employer benefit plan) maintained by the Guarantor for employees of the
Guarantor and certain affiliates of the Guarantor (including on the date
hereof Ford Motor Credit Company) and covered by Title IV of ERISA.
"Principal Domestic Manufacturing Property" means any plant in the
United States owned or leased by the Guarantor or any subsidiary of the
Guarantor, the gross book value (without deduction of any depreciation
reserves) of which on the date as of which the determination is being made
exceeds 0.5% of Consolidated Net Tangible Assets and more than 75% of the total
production measured by value (as determined by any two of the following: the
Chairman of the Board of the Guarantor, its President, any Executive Vice
President of the Guarantor, any Group Vice President of the Guarantor, any Vice
President of the Guarantor, its Treasurer or its Controller) of which in the
last fiscal year prior to said date (or such lesser period prior thereto as the
plant shall have been in operation) consisted of one or more of the following:
cars or trucks or related parts and accessories or materials for any of the
foregoing. In the case of a plant not yet in operation or of a plant newly
converted to the production of a different item or items, the total production
of such plant and the composition of such production for purposes of this
definition shall be deemed to be the Guarantor's best estimate (determined as
aforesaid) of what the actual total production of such plant and the
composition of such production will be in the 12 months following the date as
of which the determination is being made.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Regulatory Change" has the meaning set forth in Section 9.2.
"Reportable Event" has the meaning set forth in Title IV of ERISA.
"Sale and Leaseback Transaction" has the meaning set forth in Section
6.2.
"Senior Debt" has the meaning set forth in Section 6.4.
"Termination Date" means the date that is 364 days from the date of
this Agreement.
"United States dollars" and "$" mean the lawful currency of the United
States.
SECTION 2. THE LOANS
2.1 TERM LOANS
(a) Subject to the terms and conditions of this Agreement, at any
time prior to January 15, 1996, the Borrower may obtain one or more term loans
from the Bank in an aggregate principal amount
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of up to Xxx Xxxxxxx Xxxx Xxxxxxx Xxxxxxx Xxxxxx Xxxxxx dollars
($1,500,000,000) (the "Commitment"). The Loans shall be evidenced by a single
promissory note payable to the order of the Bank in an amount equal to the
aggregate unpaid principal amount of the Loans, which note shall be dated on or
before the date of the borrowing of the first Loan hereunder and shall be
substantially in the form of Exhibit A hereto (the "Note"). The principal
amount of the Loans shall be repaid as provided in Section 2.8 or 2.9. Once
the principal amount of each Loan has been repaid, it may not be reborrowed.
(b) Each Loan shall be for such Interest Period as specified by
the Borrower pursuant to Section 2.3. At the end of each Interest Period, the
Borrower may, at its option, extend such Loan pursuant to Section 2.4, but in
no event shall the Interest Period for such Loan as so extended end later than
the Termination Date.
2.2 PROCEEDS OF THE LOANS
The principal amount of each Loan shall be disbursed to the Borrower
on the date of the initial borrowing thereof in immediately available funds in
United States dollars to the bank account of the Borrower specified by the
Borrower to the Bank at the time of the borrowing.
2.3 NOTICES OF BORROWING
The Borrower shall give notice of the borrowing of each Loan to the
Bank at the Notice Office of the Bank no later than two LIBOR Business Days
prior to the date of such borrowing, but not later than 11:00 a.m. (New York
City time) on such date. The notice shall be given by telephone (and shall be
promptly confirmed in a writing substantially in the form of Exhibit B hereto)
and shall specify:
(a) the date of the borrowing, which shall be a LIBOR
Business Day;
(b) the amount of the borrowing, which shall be not less
than $1,000,000; and
(c) the duration of the initial Interest Period.
A notice of borrowing, once given to the Bank, shall not be revocable by the
Borrower.
2.4 EXTENSION OF LOANS
(a) At the end of each Interest Period with respect to each Loan,
the Borrower may, at its option, elect to extend such outstanding Loan in an
amount equal to or less than the then outstanding principal amount of such
Loan. The notice by the Borrower to the Bank of an election to extend an
outstanding Loan shall be given by telephone (and shall be promptly confirmed
in a writing substantially in the form of Exhibit B hereto) no later than two
LIBOR Business Days prior to the last day of the then-existing Interest Period
with respect to such Loan, but no later than 11:00 a.m. (New York City time) on
such day.
(b) Each notice given by the Borrower pursuant to this Section 2.4
shall specify:
(i) that such outstanding Loan is to be extended;
(ii) the principal amount of such Loan as so extended; and
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(iii) the Interest Period for such Loan as so extended.
(c) With respect to each extension of an outstanding Loan pursuant
to this Section 2.4:
(i) the Borrower shall pay to the Bank all accrued and
unpaid interest with respect to such outstanding Loan on the last day
of the then-existing Interest Period with respect thereto;
(ii) no repayment of the principal amount of such
outstanding Loan shall be required; provided, that if the Borrower
chooses to extend such Loan in a lesser principal amount, the Borrower
shall repay the principal amount not to be extended on the last day of
the then-existing Interest Period; and
(iii) the Loan to be outstanding upon the extension of such
Loan shall not be deemed to be a new Loan for purposes of Section 4.1.
2.5 INTEREST RATES
(a) Each Loan shall bear interest on the outstanding principal
amount thereof during each Interest Period applicable thereto at a rate per
annum equal to the sum of LIBOR plus the Margin.
(b) Interest on each Loan shall be computed on the basis of a year
of 360 days and paid for the actual number of days for which such Loan is
outstanding. Interest for each Interest Period shall be calculated from and
including the first day thereof to but excluding the last day thereof.
2.6 INTEREST PAYMENT DATES
Interest on each Loan shall be payable as follows: (i) if the current
Interest Period for such Loan is one month, two months or three months, on the
last day of such Interest Period or (ii) if the current Interest Period for such
Loan is six months, on the last day of the third month and on the last day of
the sixth month of such Interest Period, and in each case upon payment in full
of the Loan.
2.7 OVERDUE INTEREST
Any overdue principal of any Loan and, to the extent permitted by law,
overdue interest thereon, shall bear interest payable on demand for each day
from the date payment thereof was due to the date of actual payment, at a daily
rate, which shall be calculated by the Bank (whose determination shall be
conclusive in the absence of manifest error) and shall be a rate per annum
equal to the sum of (i) 1% plus (ii) the Margin plus (iii) the interest rate
per annum at which deposits in the amount of such overdue payment are offered
to the Bank by other leading banks, as determined by the Bank, in the interbank
market in which such deposits are obtained for one day (or, if such amount
remains unpaid more than three LIBOR Business Days, then for such other period
of time not longer than six months as the Bank may elect).
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2.8 DATES FOR PAYMENT OR OPTIONAL PREPAYMENT OF PRINCIPAL
The principal amount of each Loan shall be repaid on or before the
last day of the last Interest Period therefor, which in no event shall be later
than the Termination Date. The Borrower may, at its option, prepay the
principal amount of any Loan, in whole or in part, without penalty or premium,
on the last day of any Interest Period therefor, in each case together with
accrued interest on the amount prepaid to the date of prepayment.
2.9 OPTIONAL PREPAYMENT ON OTHER DATES; REIMBURSEMENT FOR CERTAIN COSTS
The Borrower may, at its option, prepay the principal amount of any
Loan, in whole or in part, at times other than those provided for in Section
2.8, in each case together with accrued interest on the amount prepaid to the
date of prepayment; provided, however, that the Borrower shall reimburse the
Bank on demand for any loss incurred by it as a result of the timing of such
payment, including without limitation, any loss incurred in liquidating or
re-employing deposits from third parties but excluding loss of the Margin or
any other profit for the period after such payment, provided that the amount of
such loss shall in no event exceed the amount of interest that would have
accrued from the date of prepayment to the last day of the then-current
Interest Period with respect to such Loan in the absence of prepayment, and the
Bank shall have delivered to the Borrower a written statement setting forth the
basis for determining such loss, which written statement shall be conclusive in
the absence of manifest error. The Bank shall use its reasonable efforts to
mitigate any loss resulting from any prepayment by the Borrower.
2.10 METHOD OF PAYMENT
All payments required to be made pursuant to this Agreement or the
Note shall be made in immediately available funds in United States dollars to
the account in the continental United States to be designated by the Bank.
Whenever any payment of principal of, or interest on, any Loan shall be due on
a day which is not a LIBOR Business Day, the date for payment thereof shall be
extended to the next succeeding LIBOR Business Day, unless as a result thereof
such date would fall in the next calendar month, in which case, such date shall
be advanced to the next preceding LIBOR Business Day, and, in the case of
payment of principal, interest thereon shall be payable to the date of payment
as extended or advanced as the case may be.
SECTION 3. THE GUARANTEE
(a) The Guarantor hereby guarantees to the Bank the due and
punctual payment of the principal of and interest on the Loans and any other
payment obligations of the Borrower under this Agreement or the Note (the
"Guaranteed Obligations") when and as the same shall become due and payable,
whether at maturity, upon declaration or otherwise, according to the terms
thereof. Upon the occurrence of an Event of Default under this Agreement, the
Guarantor shall on behalf of the Borrower upon demand by the Bank punctually
make any payment due and payable by the Borrower under this Agreement or the
Note, whether at maturity, upon declaration or otherwise; and any such payment
shall be treated for the purposes of this Agreement and the Note as if such
payment were made by the Borrower.
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(b) The Guarantor hereby agrees that its obligations under this
Section 3 shall be irrevocable and unconditional and that the Guarantor shall
not have the right to assert any defenses based upon the validity, regularity
or enforceability of this Agreement or the Note, the absence of any attempt to
collect from the Borrower or other action to enforce the same, the waiver or
consent by the Bank with respect to any provisions thereof or hereof (other
than with respect to this Section 3), or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of the
Guarantor.
(c) With respect to its obligations under this Section 3, the
Guarantor waives filing of claims with a court, trustee or receiver in the
event of receivership or bankruptcy of the Borrower, diligence, presentment,
demand of payment, protest or notice with respect to Guaranteed Obligations and
all demands whatsoever (other than that provided for in subsection (a) above),
and covenants that this Guarantee is a continuing guarantee and will not be
discharged except by complete performance of the Guaranteed Obligations of the
Borrower and the obligations of the Guarantor under this Guarantee.
(d) To the extent of any payment by the Guarantor to the Bank
under this Section 3, the Guarantor shall succeed to all corresponding claims
that the Bank may have and otherwise be subrogated to the rights of the Bank
against the Borrower or any other person or security in connection with the
Loans to the Borrower, and the Bank shall use reasonable efforts to cooperate
with the Guarantor in seeking recovery under such claims.
(e) The Guarantor's obligations under this Section 3 constitute a
guarantee of payment and not of collection merely and shall remain in full
force and effect until the Guaranteed Obligations shall have been paid in full
in accordance with the terms of this Agreement and the Note. If at any time
any payment of any of the Guaranteed Obligations is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, the Guarantor's obligations
hereunder with respect to such payment shall be reinstated at such time as
though such payment had not been made.
(f) If demand for, or acceleration of the time for, payment by the
Borrower to the Bank of any Guaranteed Obligations is stayed upon the
insolvency, bankruptcy, reorganization or proposed compromise or arrangement
with creditors of the Borrower, all such Guaranteed Obligations of which
payment or performance is stayed that would otherwise be subject to demand for
payment or acceleration shall nonetheless be payable by the Guarantor under
this Section 3 immediately on demand by the Bank.
SECTION 4. CONDITIONS TO THE LOANS
The obligation of the Bank to make each Loan hereunder is subject to
the performance by the Borrower of all its obligations under this Agreement and
to the satisfaction of the following further conditions:
4.1 EACH LOAN
(a) In the case of each Loan proposed to be made hereunder to the
Borrower:
(i) the Bank shall have received the notice from the
Borrower required by Section 2.3;
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(ii) the principal amount of such Loan, when added to the
sum of the aggregate principal amount of all Loans then outstanding
hereunder, shall not exceed the amount of the Commitment;
(iii) after giving effect to the making of such Loan, no
Event of Default and no event which, with the giving of notice or
lapse of time or both, would become an Event of Default, shall have
occurred and be continuing; and
(iv) the representations and warranties of the Borrower
and the Guarantor contained in this Agreement, except those contained
in Sections 5.2(a)(iii) and (b)(iii) and 5.3, shall be true and
correct in all material respects on and as of the date of such Loan,
except to the extent such representations and warranties expressly
relate to an earlier date.
Each borrowing of a new Loan shall be deemed to be a representation and
warranty by the Borrower and Guarantor that the conditions specified in clauses
(ii), (iii) and (iv) above are satisfied on and as of the date of such
borrowing.
4.2 FIRST LOAN
(a) In the case of the first Loan proposed to be made hereunder to
the Borrower:
(i) the Bank shall have received an opinion of counsel to
the Borrower and the Guarantor (which counsel may be an employee of
the Borrower or the Guarantor) addressed to the Bank and in form
satisfactory to the Bank in its reasonable judgment, to the effect
that:
(A) each of the Borrower and the Guarantor has
been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of
Delaware, with corporate power under the laws of such State to
enter into this Agreement, to borrow money as contemplated by
this Agreement and deliver the Note (in the case of the
Borrower), to extend the Guarantee (in the case of the
Guarantor), and to carry out the provisions of this Agreement
and (in the case of the Borrower) the Note;
(B) this Agreement has been duly authorized,
executed and delivered by each of the Borrower and the
Guarantor and, assuming due authorization, execution and
delivery hereof by the Bank, is a valid and binding agreement
of each of the Borrower and the Guarantor enforceable in
accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization or
similar laws relating to or affecting creditors' rights
generally and by general equitable principles regardless of
whether such enforceability is considered in a proceeding in
equity or at law;
(C) the Note has been duly authorized by the
Borrower, and when duly executed and delivered by the
Borrower, will be a valid and binding obligation of the
Borrower enforceable in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws relating to or affecting
creditors' rights generally and by general equitable
principles regardless of whether such enforceability is
considered in a proceeding in equity or at law;
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(D) the execution, delivery and performance by
each of the Borrower and the Guarantor of this Agreement and
(in the case of the Borrower) the Note will not conflict with
or result in a breach of any of the terms or provisions of, or
constitute a default under (in each case material to the
Borrower or the Guarantor, as the case may be, and its
subsidiaries considered as a whole), or result in the creation
or imposition of any lien, charge or encumbrance (in each case
material to the Borrower or the Guarantor, as the case may be,
and its subsidiaries considered as a whole) upon any of the
property or assets of the Borrower or the Guarantor, as the
case may be, pursuant to the terms of, any indenture,
mortgage, deed of trust, loan agreement, guarantee, lease
financing agreement or other similar agreement or instrument
known to such counsel under which the Borrower or the
Guarantor, as the case may be, is a debtor or a guarantor, nor
will such action result in any violation of the provisions of
the Certificate of Incorporation or the By-Laws of the
Borrower or the Guarantor, as the case may be; and
(E) there is no consent, approval, authorization,
order, registration or qualification of or with any
governmental authority having jurisdiction over the Borrower
or the Guarantor which is required for, and the absence of
which would materially affect, the execution, delivery and
performance of this Agreement or (in the case of the Borrower)
the Note;
(ii) the Bank shall have received a certificate of the
Secretary or the Assistant Secretary of each of the Borrower and the
Guarantor setting forth the resolutions of the Board of Directors
authorizing this Agreement and certifying that the persons signing
this Agreement on behalf of the Borrower and the Guarantor are duly
elected and qualified officers (indicating the offices held) of the
Borrower or the Guarantor, as the case may be, with the authority to
sign this Agreement on behalf of the Borrower or the Guarantor, as the
case may be, and setting forth the signatures of such officers; and
(iii) the Bank shall have received a certificate of good
standing of the Borrower from the State of Delaware and certificates
of good standing of the Guarantor from the States of Delaware,
Michigan, New York and Ohio.
The documents referred to in this Section 4.2 shall be delivered to
the Bank no later than two LIBOR Business Days prior to the date of the first
Loan hereunder.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE BORROWER AND GUARANTOR
The Borrower and Guarantor represent and warrant to the Bank that:
5.1 CORPORATE AUTHORITY OF THE BORROWER AND GUARANTOR, ETC.
(a) Each of the Borrower and the Guarantor has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the State of Delaware, with corporate power under the laws of such
State to execute and deliver this Agreement and (in the case of the Borrower)
the Note, and to perform its obligations under this Agreement and (in the case
of the Borrower) the Note, and (in the case of the Guarantor) is duly qualified
and in good standing to do business as a foreign corporation in the States of
Michigan, New York and Ohio;
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(b) This Agreement has been duly authorized, executed and
delivered on behalf of each of the Borrower and the Guarantor and, assuming due
authorization, execution and delivery hereof by the Bank, is a valid and
legally binding agreement of each of the Borrower and the Guarantor; and the
Note has been duly authorized by the Borrower and, when executed and delivered
in accordance with this Agreement, will have been duly executed and delivered
and will constitute a valid and legally binding obligation of the Borrower;
(c) The execution, delivery and performance by each of the
Borrower and the Guarantor of this Agreement and (in the case of the Borrower)
the Note will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under (in each case material to the
Borrower or the Guarantor, as the case may be, and its subsidiaries considered
as a whole), or result in the creation or imposition of any lien, charge or
encumbrance (in each case material to the Borrower or the Guarantor, as the
case may be, and its subsidiaries considered as a whole) upon any of the
property or assets of the Borrower or the Guarantor, as the case may be,
pursuant to the terms of, any indenture, mortgage, deed of trust, loan
agreement, guarantee, lease financing agreement or other similar agreement or
instrument under which the Borrower or the Guarantor, as the case may be, is a
debtor or a guarantor, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or the By-Laws of the Borrower
or the Guarantor, as the case may be; and
(d) There is no consent, approval, authorization, order,
registration or qualification of or with any governmental authority having
jurisdiction over the Borrower or the Guarantor which is required for, and the
absence of which would materially affect, the execution, delivery and
performance of this Agreement or (in the case of the Borrower) the Note.
5.2 FINANCIAL STATEMENTS
(a) The Borrower's Financial Statements:
(i) The Borrower has furnished the Bank with, and
the Bank hereby acknowledges receipt of, a copy of the Borrower's
Annual Report to the Securities and Exchange Commission on Form 10-K
for the year ended December 31, 1994 (the "Borrower's 10-K Report"),
and the financial statements set forth in such report present fairly
in all material respects the consolidated financial position of the
Borrower and its consolidated subsidiaries at December 31, 1994 and
1993 and the consolidated results of operations and cash flows of the
Borrower and its consolidated subsidiaries for each of the three years
in the period ended December 31, 1994, in conformity with generally
accepted accounting principles in the United States;
(ii) The Borrower has furnished the Bank with, and the Bank
hereby acknowledges receipt of, a copy of the Borrower's Quarterly
Report to the Securities and Exchange Commission on Form 10-Q for the
quarter ended September 30, 1995 (the "Borrower's 10-Q Report"), and
the financial statements set forth in such report present fairly in
all material respects the consolidated financial position of the
Borrower and its consolidated subsidiaries at September 30, 1995 and
the consolidated results of operations and cash flows of the Borrower
and its consolidated subsidiaries for the quarterly period ended
September 30, 1995, in conformity with generally accepted accounting
principles in the United States; and
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(iii) As of the date of this Agreement there has not occurred
any material adverse change in the financial position of the Borrower
and its subsidiaries considered as a whole, since December 31, 1994,
other than as set forth or contemplated in the Borrower's 10-K Report
or the Borrower's 10-Q Report.
(b) The Guarantor's Financial Statements:
(i) The Guarantor has furnished the Bank with, and the Bank
hereby acknowledges receipt of, a copy of the Guarantor's Annual
Report to the Securities and Exchange Commission on Form 10-K for the
year ended December 31, 1994 (the "Guarantor's 10-K Report"), and the
financial statements set forth in such report present fairly in all
material respects the consolidated financial position of the Guarantor
and its consolidated subsidiaries at December 31, 1994 and 1993 and
the consolidated results of operations and cash flows of the Guarantor
and its consolidated subsidiaries for each of the three years in the
period ended December 31, 1994, in conformity with generally accepted
accounting principles in the United States;
(ii) The Guarantor has furnished the Bank with, and the Bank
hereby acknowledges receipt of, a copy of the Guarantor's Quarterly
Report to the Securities and Exchange Commission on Form 10-Q for the
quarter ended September 30, 1995 (the "Guarantor's 10-Q Report"), and
the financial statements set forth in such report present fairly in
all material respects the consolidated financial position of the
Guarantor and its consolidated subsidiaries at September 30, 1995 and
the consolidated results of operations and cash flows of the Guarantor
and its consolidated subsidiaries for the quarterly period ended
September 30, 1995, in conformity with generally accepted accounting
principles in the United States; and
(iii) As of the date of this Agreement there has not occurred
any material adverse change in the financial position of the Guarantor
and its subsidiaries considered as a whole, since December 31, 1994,
other than as set forth or contemplated in the Guarantor's 10-K Report
or the Guarantor's 10-Q Report.
5.3 LITIGATION
As of the date of this Agreement there are no legal or governmental
proceedings pending of which the Borrower or the Guarantor, as the case may be,
or any of its subsidiaries is the subject, and no such proceedings are known by
the Borrower or the Guarantor, as the case may be, to be threatened or
contemplated by governmental authorities or threatened by others, other than as
set forth or contemplated in the Borrower's 10-K Report, the Borrower's 10-Q
Report, the Guarantor's 10-K Report or the Guarantor's 10-Q Report and other
than such proceedings which the Borrower or the Guarantor, as the case may be,
believes will not have a material adverse effect upon the financial position of
the Borrower or Guarantor, as the case may be, and its subsidiaries considered
as a whole.
5.4 USE OF PROCEEDS
The proceeds of the Loans will be used by the Borrower for general
corporate purposes, including, without limitation, to pay the Merger
Consideration as defined in the Information Statement of the Borrower dated on
or about October 30, 1995 in connection with the cash out of the holders of
preferred stock of the Borrower. None of such proceeds will be used, directly
or indirectly, for the purpose, whether
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immediate, incidental or ultimate, of purchasing or carrying any margin stock
within the meaning of Regulation U of the Federal Reserve Board.
5.5 COMPLIANCE WITH ERISA
The Guarantor has satisfied the minimum funding standards under ERISA
with respect to its Plans and is in compliance in all material respects with
the currently applicable provisions of ERISA.
SECTION 6. COVENANTS OF THE GUARANTOR
During the term of this Agreement, unless compliance shall have been
waived in writing by the Bank, the Guarantor agrees that:
6.1 LIMITATION ON LIENS
The Guarantor will not itself, and will not permit any Manufacturing
Subsidiary to, incur, issue, assume, guarantee or suffer to exist any notes,
bonds, debentures or other similar evidences of indebtedness for money borrowed
(notes, bonds, debentures or other similar evidences of indebtedness for money
borrowed being hereinafter called "Debt"), secured by pledge of, or mortgage or
lien on, any Principal Domestic Manufacturing Property of the Guarantor or any
Manufacturing Subsidiary, or any shares of stock of or Debt of any
Manufacturing Subsidiary (mortgages, pledges and liens being hereinafter called
"Mortgage" or "Mortgages"), without effectively providing that the Guarantee of
the Loan to the Borrower hereunder (together with, if the Guarantor shall so
determine, any other Debt of the Guarantor or such Manufacturing Subsidiary
then existing or thereafter created ranking equally with the Guarantee) shall
be secured equally and ratably with (or prior to) such secured Debt, so long as
such secured Debt shall be so secured, unless, after giving effect thereto, the
aggregate amount of all such secured Debt so secured plus all Attributable Debt
of the Guarantor and its Manufacturing Subsidiaries in respect of Sale and
Leaseback Transactions (as defined in Section 6.2) would not exceed 5% of the
Consolidated Net Tangible Assets; provided, however, that this Section 6.1
shall not apply to Debt secured by:
(a) Mortgages on property of, or on any shares of stock
of or Debt of, any corporation existing at the time such corporation
becomes a Manufacturing Subsidiary;
(b) Mortgages in favor of the Guarantor or any
Manufacturing Subsidiary;
(c) Mortgages in favor of any governmental body to secure
progress, advance or other payments pursuant to any contract or
provision of any statute;
(d) Mortgages on property, shares of stock or Debt
existing at the time of acquisition thereof (including acquisition
through merger or consolidation) or to secure the payment of all or
any part of the purchase price thereof or to secure any Debt incurred
prior to, at the time of, or within 60 days after, the acquisition of
such property or shares or Debt for the purpose of financing all or
any part of the purchase price thereof; and
(e) any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of any
Mortgage referred to in the foregoing clauses (a) to (d), inclusive;
provided, however, that such extension, renewal or replacement
Mortgage shall be
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limited to all or a part of the same property, shares of stock or Debt
that secured the Mortgage extended, renewed or replaced (plus
improvements on such property).
6.2 LIMITATION ON SALES AND LEASEBACKS
The Guarantor will not itself, and it will not permit any
Manufacturing Subsidiary to, enter into any arrangement with any bank,
insurance company or other lender or investor (not including the Guarantor or
any Manufacturing Subsidiary) or to which any such lender or investor is a
party, providing for the leasing by the Guarantor or a Manufacturing Subsidiary
for a period, including renewals, in excess of three years of any Principal
Domestic Manufacturing Property which has been or is to be sold or transferred
by the Guarantor or such Manufacturing Subsidiary to such lender or investor or
to any person to whom funds have been or are to be advanced by such lender or
investor on the security of such Principal Domestic Manufacturing Property
(herein referred to as a "Sale and Leaseback Transaction") unless either:
(a) the Guarantor or such Manufacturing Subsidiary could
create Debt secured by a Mortgage pursuant to Section 6.1 on the
Principal Domestic Manufacturing Property to be leased in an amount
equal to the Attributable Debt with respect to such Sale and Leaseback
Transaction without equally and ratably securing the Guarantee, or
(b) the Guarantor, within 120 days after the sale or
transfer shall have been made by the Guarantor or by a Manufacturing
Subsidiary, applies an amount equal to the greater of
(i) the net proceeds of the sale of the Principal
Domestic Manufacturing Property leased pursuant to such
arrangement or
(ii) the fair market value of the Principal
Domestic Manufacturing Property so leased at the time of
entering into such arrangement (as determined by any two of
the following: the Chairman of the Board of the Guarantor,
its President, any Executive Vice President of the Guarantor,
any Group Vice President of the Guarantor, any Vice President
of the Guarantor, its Treasurer or its Controller)
to the retirement of Funded Debt of the Guarantor; provided, however, that the
amount to be applied to the retirement of Funded Debt of the Guarantor shall be
reduced by the principal amount of Funded Debt voluntarily retired by the
Guarantor within 120 days after such sale.
"Attributable Debt" means, as to any particular lease under which any
person is at the time liable, at any date as of which the amount thereof is to
be determined, the total net amount of rent (discounted from the respective due
dates thereof at the rate of 9.15% per annum (which is the rate per annum borne
by the Guarantor's Sinking Fund Debentures due August 1, 2004) compounded
annually) required to be paid by such person under such lease during the
remaining term thereof. The net amount of rent required to be paid under any
such lease for any such period shall be the total amount of the rent payable by
the lessee with respect to such period, but may exclude amounts required to be
paid on account of maintenance and repairs, insurance, taxes, assessments,
water rates and similar charges. In the case of any lease which is terminable
by the lessee upon the payment of a penalty, such net amount shall also include
the amount of such penalty, but no rent shall be considered as required to be
paid under such lease subsequent to the first date upon which it may be so
terminated.
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"Funded Debt" means all indebtedness for money borrowed having a
maturity of more than 12 months from the date of the most recent balance sheet
of the Guarantor and its consolidated subsidiaries or having a maturity of less
than 12 months but by its terms being renewable or extendible beyond 12 months
from the date of such balance sheet at the option of the borrower.
6.3 MERGERS AND CONSOLIDATIONS
The Guarantor may consolidate with, or sell or convey all or
substantially all its assets to, or merge with or into any other corporation,
provided that in any such case (i) the successor corporation shall be a
corporation organized and existing under the laws of the United States of
America or a State thereof, (ii) such corporation shall expressly assume the
due and punctual performance and observance of all the covenants and conditions
of this Agreement to be performed by the Guarantor, including, without
limitation, the Guarantee, by an instrument, satisfactory to the Bank in its
reasonable judgment, executed and delivered to the Bank by such corporation,
and (iii) such successor corporation shall not, immediately after such merger
or consolidation or such sale or conveyance, be in default in the performance
of any such covenant or condition and shall not immediately thereafter have
outstanding any secured Debt not expressly permitted by the provisions of
Section 6.1.
6.4 ADDITIONAL COVENANTS
In the event that, at any time while this Agreement is in effect, the
Guarantor shall issue any indebtedness for borrowed money which is not by its
terms subordinate and junior to other indebtedness of the Guarantor ("Senior
Debt") and such Senior Debt shall include, or be issued pursuant to a trust
indenture or other agreement which includes, financial covenants not
substantially provided for in this Agreement, the Guarantor shall so advise the
Bank. Thereupon, if the Bank shall so request by written notice to the
Guarantor, the Guarantor and the Bank shall enter into an amendment to this
Agreement providing for substantially the same financial covenants as those
contained in such Senior Debt, trust indenture or other agreement, mutatis
mutandis. Such amendment containing such financial covenants shall remain in
effect so long as such covenants remain in effect with respect to such Senior
Debt. As used in this Section 6.4 the term "financial covenant" shall mean a
covenant on the part of the Guarantor to the general effect that the Guarantor
shall maintain, on a consolidated basis and as of a specified date or dates,
(a) a specified minimum net worth, (b) a ratio of debt to net worth not in
excess of a specified maximum, (c) current assets in an amount not less than a
specified amount in excess of current liabilities or (d) any similar ratio or
amount or similar measure for the same general purpose of stating a minimum
financial condition.
6.5 ERISA
The Guarantor will comply with the minimum funding standards under
ERISA with respect to its Plans and will use its best efforts to comply in all
material respects with all other applicable provisions of ERISA and the
regulations and interpretations promulgated thereunder. The Guarantor will
deliver to the Bank within 30 days after any executive officer of the Guarantor
becomes aware of the occurrence of any Reportable Event (other than a reduction
in active Plan participants) with respect to any Plan, a certificate signed by
the Chief Financial Officer, the Vice President - Finance, the Controller or
the Treasurer of the Guarantor setting forth the details as to such Reportable
Event and the action which the Guarantor is taking and proposes to take with
respect thereto, together with a copy of the notice of such Reportable Event
given to the Pension Benefit Guaranty Corporation.
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6.6 NOTIFICATION
The Guarantor will notify the Bank within 30 days after any executive
officer of the Company becomes aware of any failure on the part of the Company
duly to observe or perform any covenant contained in Section 6.1 or 6.2.
SECTION 7. DEFAULT
In case one or more of the following "Events of Default" shall have
occurred and be continuing, that is to say:
(a) default in any payment of principal of any Loan as
and when the same shall become due and payable, whether at maturity or
upon required repayment or upon declaration or otherwise, and the
continuance of such default for five Domestic Business Days; or
(b) default in the payment of any installment of interest
upon any Loan as and when the same shall become due and payable, and
continuance of such default for a period of five Domestic Business
Days; or
(c) failure on the part of the Guarantor duly to observe
or perform any covenant contained in Section 6.1 or Section 6.2 for 90
days after the date on which written notice of such failure, requiring
the Guarantor to remedy the same, shall have been given to the
Guarantor by the Bank; or
(d) failure on the part of the Borrower or the Guarantor,
as the case may be, duly to observe or perform any of its other
covenants or agreements in this Agreement for a period of 30 days
after the date on which written notice of such failure, requiring the
Borrower or the Guarantor, as the case may be, to remedy the same,
shall have been given to the Borrower or the Guarantor, as the case
may be, by the Bank; provided, however, that in the case of a default
under Section 3, such 30-day grace period shall run from the date that
demand for payment by the Bank was made upon the Guarantor pursuant to
Section 3; or
(e) any representation or warranty by the Borrower or the
Guarantor in this Agreement or in any certificate delivered pursuant
hereto shall have proven to have been materially false or misleading
when made or given; or
(f) a Reportable Event (other than a reduction in active
Plan participants) shall have occurred with respect to any Plan and,
within 30 days after the reporting of such Reportable Event to the
Bank, the Bank shall have notified the Guarantor in writing that the
Bank has made a reasonable determination that such Reportable Event is
likely to have a material adverse effect upon the financial position
of the Guarantor and its subsidiaries considered as a whole; or
(g) either the Borrower or the Guarantor shall have
entered against it by a court having jurisdiction in the premises a
decree or order for relief in respect of the Borrower or Guarantor, as
the case may be, in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Borrower or
Guarantor, as the case may be, or for
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any substantial part of its property, or ordering the winding-up or liquidation
of its affairs and such decree or order shall remain unstayed and in effect for
a period of 90 consecutive days; or
(h) either the Borrower or Guarantor shall commence a
voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or consent to the entry of an
order for relief in an involuntary case under any such law, or consent
to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or similar official) of
the Borrower or Guarantor, as the case may be, or for any substantial
part of its property, or make any general assignment for the benefit
of creditors, or fail generally to pay its debts as they become due,
or take any corporate action in furtherance of any of the foregoing;
or
(i) default in the payment of the principal of (or
premium, if any, on) or interest on any other borrowing of the
Borrower or Guarantor of $5,000,000 or more and such default continues
for a period of 30 days, or any default with respect to any other
borrowing of the Borrower or Guarantor of $5,000,000 or more and such
default causes acceleration thereof; or
(j) either (i) more than 50% in voting power of the
voting securities of the Guarantor shall be held by any person or
persons who "act as a partnership, limited partnership, syndicate or
other group for the purpose of acquiring, holding or disposing of
securities" of the Guarantor within the meaning of Section 13(d)(3) of
the Securities Exchange Act of 1934 or (ii) persons whose election to
the Board of Directors shall not have been recommended by the
Organization Review and Nominating Committee (or successor Committee)
of the Board shall constitute a majority of the members of the Board
of Directors of the Guarantor; or
(k) the Guarantee set forth in Section 3 shall no longer
be in full force and effect;
then, and in each and every such case, the Bank, by notice in writing to the
Borrower and the Guarantor, may terminate this Agreement and/or may declare the
principal of all outstanding Loans to be due and payable immediately, and upon
any such declaration the same shall become and shall be immediately due and
payable, without presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived.
SECTION 8. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE BANK
8.1 ACQUISITION OF THE NOTE
The Bank represents and warrants to the Borrower that it is the
present intention of the Bank to acquire the Note to be delivered to it
hereunder for its own account as a result of making loans in the ordinary
course of its commercial banking business and not with a view to the
distribution or resale of any thereof, other than in connection with any
assignment or participation provided for under Section 8.2, subject,
nevertheless, to any legal or administrative requirement that the disposition
of the property of the Bank shall at all times be within its control.
8.2 ASSIGNMENT; PARTICIPATION
The Bank shall not, without the consent of the Borrower and Guarantor
(which consents shall not be unreasonably withheld), transfer to any other
office, branch or affiliate of the Bank or to any other
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financial institution, person or entity, all or any portion of the Loans, the
Note, the Commitment or any of the Bank's other rights and obligations under
this Agreement and the Note; provided, however, that (i) the Bank may transfer
or assign the Note or the Loans or any interest therein as a pledge to any
Federal Reserve Bank, provided that such pledge shall not release the Bank from
its obligations hereunder and (ii) the Bank may transfer or assign all or any
portion of the Loans, the Note, the Commitment or any of the Bank's other
rights and obligations under this Agreement and the Note to any office, branch
or affiliate of the Bank located in the United States. Any such transferee or
assignee of the Bank shall not be entitled to receive any greater interest or
other payment by reason of Section 9.2 than the Bank would have been entitled
to receive with respect to the rights so transferred or assigned unless such
transfer or assignment is made by reason of the provisions of Section 9.1 or
9.2 requiring the Bank to designate a different lending office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
The Bank shall have the right to sell to any bank or other financial
institution (a "Participant") a participating interest in the Commitment or in
the Loans and the Note; provided, however, that, following any such sale, (a)
the Bank's obligations under this Agreement shall remain unmodified and fully
effective and enforceable against the Bank, (b) the Bank shall remain solely
responsible to the Borrower and the Guarantor for the performance of such
obligations, including, without limitation, the Commitment and the obligation
of the Bank to fund Loans hereunder, (c) the Bank shall remain the holder of
the then outstanding Note for all purposes of this Agreement, (d) the Borrower
and Guarantor shall continue to deal solely and directly with the Bank in
connection with the Bank's rights and obligations under this Agreement, (e) the
Bank shall retain the sole right and responsibility to enforce the obligations
of the Borrower and Guarantor hereunder and under the Note, including, without
limitation, the sole right to approve of or consent to any action hereunder and
under the Note or any amendment, modification or waiver hereof and of the Note,
except that the Bank may grant to a Participant a joint right to approve of or
consent to any action, amendment, modification or waiver that would (i) reduce
the amount or extend the time for payment (other than pursuant to Section 2.4)
of any principal of, or interest on, the Note, or (ii) increase the amount of
the Commitment, in each case, from that in effect at the time of the sale of
the participating interest, and (f) any such participating interest shall be in
a minimum amount of $5,000,000 on the date the participating interest is sold.
The Bank shall as soon as practicable notify the Borrower and the Guarantor of
the names of any Participants.
SECTION 9. CHANGES IN CIRCUMSTANCES
9.1 ILLEGALITY
(a) If, after the date of this Agreement, the introduction of, or
any change in, any applicable law or regulation or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof or compliance by the Bank with any
request or directive of any such authority shall make it unlawful for the Bank
to make, maintain or fund any Loan, the Bank shall give notice thereof to the
Borrower. Before giving any notice pursuant to this Section 9.1, the Bank
shall designate a different lending office if such designation would avoid the
need for giving such notice and it would not otherwise be disadvantageous to
the Bank in its reasonable judgment. Upon receipt of such notice the Borrower
shall on either (A) the last day of the then-current Interest Period applicable
to such Loan if the Bank may lawfully continue to maintain and fund such Loan
to such day or (B) not later than the last date the Bank may lawfully continue
to fund and maintain such Loan, either (i) prepay in full, without premium or
penalty, the then outstanding principal amount of such Loan, together with
accrued interest thereon, or (ii) convert such Loan into another type of Loan
upon such terms and conditions as shall be
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mutually agreed to by the Bank and the Borrower (if it would not be unlawful
for the Bank to make such other type of Loan).
(b) Upon any prepayment or conversion of any Loan made pursuant to
Section 9.1(a) other than at the end of an Interest Period, the Borrower shall
reimburse the Bank upon demand for any loss incurred by it as a result of the
timing of such prepayment or conversion, in the manner provided in Section 2.9.
9.2 INCREASED COST
(a) If (i) Regulation D of the Federal Reserve Board as in effect
on the date hereof ("Regulation D") or (ii) after the date hereof, the adoption
of any applicable law or regulation, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Bank with any request or directive
of any such authority, central bank or comparable agency (a "Regulatory
Change"):
(A) shall subject the Bank to any tax, duty or other
charge with respect to the Loans while the interest rate on the Loans
is derived from LIBOR or its obligation to make such Loans, or shall
change the basis of taxation of payments to the Bank of the principal
of or interest on such Loans or any other amounts due under this
Agreement in respect of such Loans or its obligation to make such
Loans (except for changes in the rate of tax on the overall net income
of the Bank or the lending office of the Bank making such Loans
imposed by the jurisdictions in which such Bank's principal executive
office or such lending office are located); or
(B) shall impose, modify or cause to be applicable any
reserve (including, without limitation, any imposed by the Federal
Reserve Board), special deposit or similar requirement against assets
of, deposits with or for the account of, or credit extended by, the
Bank or such lending office or shall impose on the Bank (or such
lending office) or all interbank markets applicable to such Loans
any other condition affecting such Loans or its obligation to make
such Loans;
and the result of any of the foregoing is to increase the cost to the Bank (or
such lending office) of making or maintaining any such Loan, or to reduce the
amount of any sum received or receivable by the Bank (or such lending office)
under this Agreement or the Note, by an amount deemed by the Bank to be
material, the Borrower shall pay to the Bank such additional amount or amounts
as will compensate the Bank for any such increased cost or reduction incurred
or suffered by the Bank from and after the later of (i) the date that is 15
days prior to receipt of notice from the Bank of such costs and (ii) the last
date preceding receipt of such notice from the Bank on which interest was due
and payable pursuant to Section 2.6 on any such Loan.
(b) Without limiting the effect of the foregoing, so long as the
Bank shall be required to maintain reserves against "Eurocurrency liabilities"
under Regulation D (or, so long as the Bank may be required, by reason of any
Regulatory Change, to maintain reserves against any other category of
liabilities which includes deposits by reference to which LIBOR is determined
as provided in this Agreement or against any category of extensions of credit
or other assets of the Bank which includes the Loans as LIBOR-based loans)
(such reserves are collectively called "Reserves") the Borrower shall pay to
the Bank an amount (reasonably estimated by the Bank) for each day during each
Interest Period for such Loans equal to the product of the following:
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(i) the principal amount of each Loan to which such
Interest Period relates; multiplied by
(ii) the difference between (A) a fraction, the numerator
of which is LIBOR (expressed as a decimal) applicable to such Loan and
the denominator of which is one (1) minus the Bank's Actual Reserve
Cost (defined below) (expressed as a decimal) and (B) LIBOR;
multiplied by
(iii) 1/360.
For the purposes of this Section 9.2(b), the "Bank's Actual Reserve
Cost" (which shall be reasonably estimated by the Bank) shall be equal to the
cost actually incurred by the Bank from time to time during such Interest
Period as a result of the requirement that the Bank maintain Reserves with
respect to such Loan.
(c) The Bank shall take reasonable steps, including without
limitation, the designation of a different lending office (unless it would
otherwise be disadvantageous to the Bank in its reasonable judgment) if such
steps would avoid the need for or reduce the amount of any payment that
otherwise would be due under Section 9.2(a) or 9.2(b). Any amounts payable by
the Borrower under Sections 9.2(a) and 9.2(b) shall be remitted after the end
of each Interest Period, within 30 days after submission by the Bank to the
Borrower of a written statement setting forth the amount thereof.
(d) From time to time during the term of this Agreement, upon the
request of the Borrower, the Bank shall provide to the Borrower its best
estimate of the Bank's Actual Reserve Cost incurred or to be incurred with
respect to LIBOR-based loans in the principal amount specified in the
Borrower's request.
SECTION 10. MISCELLANEOUS
10.1 NOTICES
Unless otherwise specified herein all notices, requests, demands or
other communications to or from the parties hereto shall be in writing and
shall be deemed to have been duly given and made, in the case of a letter, upon
delivery or three days after deposit in the mail registered first class mail,
postage prepaid; and in the case of a facsimile, when a facsimile is sent and
receipt is telephonically confirmed; provided, however, that notices pursuant
to Section 2.3 or 2.4 or any other notices herein which are given by telephone
shall not be effective until received by the party to whom notice is given.
Unless otherwise specified herein, any such notice, request, demand, or
communication shall be delivered or addressed as follows:
(a) if to the Borrower, to it at The American Road,
Dearborn, Michigan 48121 U.S.A., Attention: Vice President and
Treasurer (or facsimile number 000-000-0000, Attention: Vice President
and Treasurer);
(b) if to the Guarantor, to it at Xxx Xxxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxx 00000 U.S.A., Attention: Assistant Treasurer in
charge of banking (or facsimile number 000-000-0000, Attention:
Assistant Treasurer in charge of banking);
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(c) if to the Bank, to it at ____________________________________,
Attention: ______________ (or facsimile number ________________, Attention:
_______________) (such office, as it may be changed from time to time
pursuant to this Section, is referred to herein as the "Notice Office");
and
(d) if to any other holder of the Note, to it at the address or
facsimile number of such holder specified in a notice given to the Borrower
and the Guarantor or, if such holder's address and facsimile number have
not been so specified, at the address or facsimile number of the payee of
the Note;
or at such other address or facsimile number as either party hereto may
designate by written notice to the other party hereto; or, in the case of
such other holder of the Note, at the address and facsimile number of any
such holder as such holder may designate by written notice to the Bank,
Borrower and Guarantor.
10.2 TERM OF AGREEMENT
The term of this Agreement shall be until the payment in full of the
Loans or, in the event no Loans are borrowed hereunder by the date set forth in
Section 2.1(a), until such date; provided that the Borrower may terminate this
Agreement at any time prior to the date any Loan is borrowed hereunder by
giving the Bank two Domestic Business Days' prior notice; and provided,
further, that the obligations of the Borrower or Guarantor with respect to any
payment required to be made by it under this Agreement shall survive the term
of this Agreement.
10.3 NO WAIVERS
No failure or delay by the Bank or any other holder of the Note in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege.
10.4 NEW YORK LAW AND JURISDICTION
(a) THIS AGREEMENT AND THE NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH, AND GOVERNED BY, THE INTERNAL LAWS (EXCLUDING THE LAW OF CONFLICTS) OF
THE STATE OF NEW YORK.
(b) EACH PARTY TO THIS AGREEMENT IRREVOCABLY AND UNCONDITIONALLY
SUBMITS TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE COURTS OF THE XXXXX XX
XXX XXXX XXX XX XXX XXXXXX XXXXXX FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
THE APPELLATE COURTS FROM ANY THEREOF, FOR PURPOSES OF ANY ACTION ARISING UNDER
THIS AGREEMENT OR THE NOTE OR REGARDING THE LOANS MADE HEREUNDER, AND EACH
HEREBY AGREES THAT ANY DISPUTES RELATING TO THIS AGREEMENT, THE NOTE OR THE
LOANS SHALL BE RESOLVED ONLY IN THE COURTS OF THE STATE OF NEW YORK OR OF THE
UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK. EACH OF SUCH PARTIES
HEREBY STIPULATES THAT THE VENUES REFERENCED IN THIS SECTION 10.4(B) ARE
CONVENIENT AND EACH WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
RELATING TO THE VENUE OR CONVENIENCE OF SUCH COURTS. IF FOR ANY REASON CLAIMS
HEREUNDER CANNOT BE PURSUED IN ANY OF THE
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XXXXXXXXX XXXXXX XX XXX XXXX, ALL REFERENCES IN THIS SECTION 10.4(B) TO THE
COURTS OF NEW YORK SHALL INSTEAD BE DEEMED TO BE REFERENCES TO THE COURTS OF
THE XXXXX XX XXXXXXXX XXX XX XXX XXXXXX XXXXXX FOR THE EASTERN DISTRICT OF
MICHIGAN. ENFORCEMENT OF FINAL, NONAPPEALABLE JUDGMENTS RECEIVED IN ANY OF
THE FOREGOING COURTS MAY ALSO BE SOUGHT IN ANY OTHER APPROPRIATE COURT OR
JURISDICTION.
10.5 ENTIRE AGREEMENT
This Agreement, together with the Note, constitutes the entire
understanding between the parties with respect to the subject matter of this
Agreement and supersedes any prior discussions, negotiations, agreements and
understandings. The parties hereto acknowledge that the general banking or
business conditions or any similar bank lending rules or requirements of any
organization not having the force of law, now or hereafter in effect,
shall not be applicable to this Agreement, the Note or the Loans.
10.6 PAYMENT OF CERTAIN EXPENSES
The Borrower will upon the occurrence of an Event of Default pay all
reasonable out-of-pocket expenses incurred by the Bank (including counsel fees)
in connection with such Event of Default and collection and other enforcement
proceedings resulting therefrom.
10.7 CHANGES, WAIVERS, ETC.
Neither this Agreement nor any provision hereof may be changed,
waived, discharged or terminated orally, but only by a statement in writing
signed by the Borrower, the Guarantor and the Bank.
10.8 SEVERABILITY
If any provision of this Agreement or the application thereof to any
person or circumstance shall be invalid or unenforceable to any extent, the
remainder of this Agreement, or the application of such provision to persons or
circumstances other than those as to which it is invalid or unenforceable,
shall not be affected thereby, and each provision of this Agreement shall be
valid and enforceable to the extent permitted by law.
10.9 SUCCESSORS AND ASSIGNS
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Upon execution of
an instrument, satisfactory to the Bank in its reasonable judgment, evidencing
such assumption, any direct or indirect subsidiary of the Guarantor may at any
time assume the rights and obligations of the Borrower under this Agreement,
the Loans and the Note, with the Guarantee of the Guarantor remaining in full
force and effect, and upon any such assumption, the Borrower shall be
completely relieved of all of its obligations under this Agreement, the Loans
and the Note, and the entity which has assumed such obligations shall be
considered the Borrower for all purposes under this Agreement, the Loans and
the Note.
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10.10 COUNTERPARTS
This Agreement may be signed in any number of counterparts with the
same effect as if the signatures thereto and hereto were upon the same
instrument. Complete sets of counterparts shall be delivered to the Borrower,
the Guarantor and the Bank.
10.11 ELECTRONIC RECORDING
The parties to this Agreement may electronically record any telephone
communications with one another relating to any notices of borrowing or
extension pursuant to Section 2.3 or 2.4. In the event that any electronically
recorded notice of borrowing or extension differs from the terms of the
corresponding written notice of borrowing or extension, the terms of the
electronically recorded notice shall control.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
FORD HOLDINGS, INC.
By: ____________________________________
Name:
Title:
FORD MOTOR COMPANY
By: ____________________________________
Name:
Title:
[NAME OF BANK]
By: ____________________________________
Name:
Title:
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EXHIBIT A
PROMISSORY NOTE
[DATE]
FOR VALUE RECEIVED, FORD HOLDINGS, INC., a Delaware corporation (the
"Borrower"), hereby unconditionally promises to pay to the order of [NAME AND
ADDRESS OF BANK] (the "Bank") the aggregate unpaid principal amount of the
Loans to the Borrower then outstanding, no later than the Termination Date;
provided, however, that the Borrower shall pay the unpaid principal amount of
each Loan made to the Borrower on the last day of the last Interest Period with
respect thereto. The Company shall pay interest on the unpaid principal amount
of each Loan from time to time outstanding, and on any overdue principal and,
to the extent permitted by law, on overdue interest thereon, at such interest
rates and on such dates as are determined from time to time pursuant to the
Term Loan Agreement referred to below. All such principal and interest shall
be payable in lawful currency of the United States of America in immediately
available funds.
The holder of this Note is hereby authorized by the Borrower to, and
prior to any transfer of this Note shall, endorse on the schedule forming a
part hereof or a continuation thereof appropriate notations evidencing the
date, amount and Interest Period of each Loan, as it may be extended from time
to time, and the date and amount of each payment of principal made by the
Borrower.
This Note is the Note referred to in the Term Loan Agreement dated as
of November __, 1995, among the Borrower, Ford Motor Company, as Guarantor, and
the Bank, as amended from time to time. Reference is made to such Term Loan
Agreement for provisions for the prepayment hereof, for the acceleration of the
maturity hereof and for the Guarantee hereof. Terms defined in such Term Loan
Agreement are used herein as therein defined.
This Note shall be construed in accordance with, and governed by, the
internal laws (excluding the law of conflicts) of the State of New York.
FORD HOLDINGS, INC.
By: _______________________________
Name:
Title:
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SCHEDULE OF PAYMENTS OF PRINCIPAL
TO PROMISSORY NOTE DATED [DATE] OF FORD HOLDINGS, INC.
Amount of Unpaid
Amount of Interest Principal Principal
Date Loan Period Paid Balance Notation
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EXHIBIT B
NOTICE OF [BORROWING/EXTENSION]
Date: ________________
To: [NAME AND ADDRESS OR FACSIMILE
NUMBER OF NOTICE OFFICE OF BANK]
Pursuant to Section 2.3 or 2.4, as applicable, of the Term Loan
Agreement dated as of November __, 1995, among Ford Holdings, Inc., Ford Motor
Company and [NAME OF BANK], we hereby confirm the notice of
[borrowing/extension] we gave you by telephone, and the interest rate
applicable thereto, as follows:
[Loan Prior to [Loan After
Extension] Extension]
Date of [Borrowing/Extension]:
Amount of Borrowing: $
Interest Period:
Interest Rate:
Bank Account to Receive Funds:
Sincerely,
FORD HOLDINGS, INC.
By: ________________________________
Name:
Title:
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