CREDIT AGREEMENT
dated as of June 17, 2003
among
MOVADO GROUP, INC.,
CONCORD WATCH COMPANY S.A., MOVADO WATCH COMPANY SA,
and
the Lenders signatory hereto
and
JPMORGAN CHASE BANK,
as Administrative Agent, and as Swingline Bank,
and as Issuing Bank.
---------------------------------------
X.X. XXXXXX SECURITIES, INC.,
as Arranger,
FLEET NATIONAL BANK,
as Syndication Agent
and
THE BANK OF NEW YORK,
as Documentation Agent
Table of Contents
Page
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ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS 1
Section 1.1. Definitions 1
Section 1.2. Accounting Terms 13
Section 1.3. Terms Generally 13
Section 1.4. Determination of Exchange Rates 14
ARTICLE 2. THE LOANS 14
Section 2.1. Syndicated Loans 14
Section 2.2. Making of Syndicated Loans 14
Section 2.3. Borrowing Procedure as to Syndicated Loans 15
Section 2.4. Swingline Loans 16
Section 2.5. Participations by All Lenders in Swingline Loans 17
Section 2.6. Repayment of Loans 17
Section 2.7. Certain Fees 18
Section 2.8. Interest on Loans 19
Section 2.9. Default Interest 19
Section 2.10. Termination and Reduction of Commitments 19
Section 2.11. Conversion and Continuation of Borrowings 20
Section 2.12. Optional Prepayment 21
Section 2.13. Mandatory Prepayments 22
Section 2.14. Payments 23
Section 2.15. Purpose 24
Section 2.16. Increase of Total Revolving Credit Commitment 24
ARTICLE 3. LETTERS OF CREDIT 25
Section 3.1. Letters of Credit 25
Section 3.2. Notice of Issuance, Amendment, Renewal, Extension;
Certain Conditions. 25
Section 3.3. Minimum Amount; Expiration Date 25
Section 3.4. Participations 26
Section 3.5. Reimbursement 26
Section 3.6. Obligations Absolute 27
Section 3.7. Disbursement Procedures 28
Section 3.8. Interim Interest 28
Section 3.9. Letter of Credit Fees 28
Section 3.10. Resignation of the Issuing Bank 28
Section 3.11. Not Fiduciary 29
Section 3.12. Purpose 29
ARTICLE 4. YIELD PROTECTION; ILLEGALITY; ETC 29
Section 4.1. Alternate Rate of Interest 29
Section 4.2. Reserve Requirement; Change in Circumstances 29
Section 4.3. Change in Legality 31
Section 4.4. Indemnity 31
Section 4.5. Taxes 32
Section 4.6. Duty to Mitigate 33
Section 4.7. Replacement of Lenders 33
Section 4.8. Certain Additional Costs 33
ARTICLE 5. CONDITIONS PRECEDENT 34
Section 5.1. Documentary Conditions Precedent 34
Section 5.2. Additional Conditions Precedent 35
i
Section 5.3. Deemed Representations 36
ARTICLE 6. REPRESENTATIONS AND WARRANTIES 36
Section 6.1. Incorporation, Good Standing and Due Qualification 36
Section 6.2. Corporate Power and Authority; No Conflicts 36
Section 6.3. Legally Enforceable Agreements 36
Section 6.4. Litigation 37
Section 6.5. Financial Statements 37
Section 6.6. Ownership and Liens 37
Section 6.7. Taxes 37
Section 6.8. ERISA 37
Section 6.9. Subsidiaries and Ownership of Stock 38
Section 6.10. Credit Arrangements 38
Section 6.11. Operation of Business 38
Section 6.12. Hazardous Materials 38
Section 6.13. No Default on Outstanding Judgments or Orders 40
Section 6.14. No Defaults on Other Agreements 40
Section 6.15. Labor Disputes and Acts of God 40
Section 6.16. Governmental Regulation 40
Section 6.17. Partnerships 40
Section 6.18. No Forfeiture 40
Section 6.19. Solvency 41
Section 6.20. Certain Particular Assurances as to the Foreign
Subsidiary Borrowers. 41
ARTICLE 7. AFFIRMATIVE COVENANTS 42
Section 7.1. Maintenance of Existence 42
Section 7.2. Conduct of Business 42
Section 7.3. Maintenance of Properties 42
Section 7.4. Maintenance of Records 42
Section 7.5. Maintenance of Insurance 42
Section 7.6. Compliance with Laws; Payment of Taxes 42
Section 7.7. Right of Inspection 43
Section 7.8. Reporting Requirements 43
Section 7.9. Subsidiary Guarantee 46
Section 7.10. Equal and Ratable Lien 46
ARTICLE 8. NEGATIVE COVENANTS 46
Section 8.1. Debt 46
Section 8.2. Guaranties, Etc 48
Section 8.3. Liens 49
Section 8.4. Leases 50
Section 8.5. Investments 50
Section 8.6. Dividends 51
Section 8.7. Sale of Assets 51
Section 8.8. Stock of Subsidiaries, Etc 52
Section 8.9. Transactions with Affiliates 52
Section 8.10. Mergers, Etc 53
Section 8.11. Acquisitions 53
Section 8.12. No Material Change in Business 53
Section 8.13. No Restriction 53
Section 8.14. Swap and Exchange Agreements 53
Section 8.15. Certain Subsidiary Liabilities 54
ARTICLE 9. FINANCIAL COVENANTS 54
Section 9.1. Tangible Net Worth 54
Section 9.2. Interest Coverage Ratio 54
ii
Section 9.3. Average Debt Coverage Ratio 54
Section 9.4. Capital Expenditures 54
ARTICLE 10. EVENTS OF DEFAULT 54
Section 10.1. Events of Default 54
Section 10.2. Remedies 56
ARTICLE 11. THE ADMINISTRATIVE AGENT; RELATIONS AMONG LENDERS AND PARENT 56
Section 11.1. Appointment, Powers and Immunities of Administrative
Agent 56
Section 11.2. Reliance by Administrative Agent 57
Section 11.3. Defaults 57
Section 11.4. Rights of Administrative Agent as a Lender 57
Section 11.5. Indemnification of Administrative Agent 57
Section 11.6. Documents 58
Section 11.7. Non-Reliance on Administrative Agent and Other Lenders 58
Section 11.8. Failure of Administrative Agent to Act 58
Section 11.9. Resignation or Removal of Administrative Agent 58
Section 11.10. Amendments Concerning Agency Function 59
Section 11.11. Liability of Administrative Agent 59
Section 11.12. Delegation of Agency Functions 59
Section 11.13. Non-Receipt of Funds by the Administrative Agent 59
Section 11.14. Withholding Taxes 59
Section 11.15. Several Obligations and Rights of Lenders 60
Section 11.16. Pro Rata Treatment of Syndicated Loans, Etc 60
Section 11.17. Sharing of Payments Among Lenders 60
Section 11.18. Syndication Agent and Documentation Agent 60
ARTICLE 12. MISCELLANEOUS 61
Section 12.1. Amendments and Waivers; Remedies Cumulative 61
Section 12.2. Usury 62
Section 12.3. Expenses; Indemnity; Damage Waiver 62
Section 12.4. Survival 63
Section 12.5. Assignment; Participations 63
Section 12.6. Notices 66
Section 12.7. Setoff 66
SECTION 12.8. JURISDICTION; JURY WAIVER; IMMUNITIES 66
Section 12.9. Table of Contents; Headings 67
Section 12.10. Severability 67
Section 12.11. Authorization of Parent 67
Section 12.12. Integration 68
SECTION 12.13. GOVERNING LAW 68
Section 12.14. Confidentiality 68
Section 12.15. Treatment of Certain Information 68
Section 12.16. Judgment Currency 68
Section 12.17. Counterparts 69
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EXHIBITS
Exhibit A-1 Form of Syndicated Loan Note
Exhibit A-2 Form of Swingline Loan Note
Exhibit B Form of Authorization Letter
Exhibit C-1 Form of Opinion of Xxxxxxx X. Xxxxxx, Esq.
Exhibit C-2 Form of Opinion of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx)
Exhibit C-3 Form of Opinion of Swiss Counsel for the Foreign Subsidiary Borrowers
Exhibit D-1 Form of Subsidiary Guarantee
Exhibit D-2 Form of Parent Guarantee
Exhibit E Form of Assignment and Assumption Agreement
Exhibit F Form of Confidentiality Agreement
SCHEDULES
Schedule I Lenders and Amounts of Revolving Credit Commitments
Schedule II Applicable Rates
Schedule III Subsidiaries of Parent
Schedule IV Credit Arrangements
Schedule V Environmental Matters
iv
CREDIT AGREEMENT dated as of June 17, 2003 among MOVADO GROUP, INC., a
corporation organized under the laws of New York (the "Parent"); CONCORD WATCH
COMPANY S.A., a corporation organized under the laws of Switzerland ("Concord");
MOVADO WATCH COMPANY SA, a corporation organized under the laws of Switzerland
("MWC"); each of the lenders which is a signatory hereto (individually a
"Lender" and collectively the "Lenders"); and JPMORGAN CHASE BANK, a New York
banking corporation, as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the "Administrative Agent"), and
as swingline bank (in such capacity, together with its successors in such
capacity, the "Swingline Bank"), and as issuing bank (in such capacity, together
with its successors in such capacity, the "Issuing Bank").
The Parent, Concord and MWC desire that the Lenders, the Swingline Bank
and the Issuing Bank extend credit as provided herein, and the Lenders, the
Swingline Bank and the Issuing Bank are prepared to extend such credit.
Accordingly, the Parent, Concord, MWC, the Lenders, the Swingline Bank, the
Issuing Bank and the Administrative Agent agree as follows:
ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS.
Section 1.1. Definitions. As used in this Agreement the following terms
have the following meanings (terms defined in the singular to have a correlative
meaning when used in the plural and vice versa):
"ABR Borrowing" means a Borrowing comprised of ABR Loans that are
Syndicated Loans or a Borrowing of an ABR Loan that is a Swingline Loan.
"ABR Loan" means any Loan bearing interest at a rate determined by
reference to the Alternate Base Rate in accordance with the provisions of
Article 2.
"Acceptable Credit Rating" is defined in Section 8.5.
"Acquisition" is defined in Section 8.11.
"Adjusted LIBO Rate" means, with respect to any LIBOR Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/32nd of 1%) equal to the product of (a) the LIBO Rate in effect for
such Interest Period and (b) Statutory Reserves.
"Administrative Agent" is defined in the initial paragraph of this
Agreement. If the Administrative Agent pursuant to Section 11.12 designates any
of its Affiliates to perform any of its duties or exercise any of its rights or
powers with respect to any Foreign Currency Loans or Foreign Currency
Borrowings, the term "Administrative Agent" shall include, as well, such
Affiliate with respect thereto.
"Administrative Agent Fees" is defined in Section 2.7.
"Affiliate" means, when used with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Aggregate Credit Exposure" means, at any time, the sum at such time of
(i) the aggregate of the Lenders' Syndicated Loan Exposures, (ii) the L/C
Exposure and (iii) the outstanding principal balance of all Swingline Loans.
"Aggregate Net Cash Proceeds" means, as to sales and mergers that are
Designated Sales, the aggregate cash proceeds received by the Parent or a
Subsidiary (including cash proceeds subsequently received (as and when received)
in respect of non-cash consideration initially received), net of (a) selling
expenses (including reasonable broker's fees or commissions, transfer and
similar taxes, any amount
actually paid by the Parent or a Subsidiary to repay or discharge Debt secured
by a Lien on any property or asset included in the applicable Designated Sale
other than Debt incurred in contemplation of the applicable Designated Sale, and
the Parent's good faith estimate of income taxes paid or payable in connection
with the receipt of such cash proceeds), and (b) amounts provided as a reserve,
in accordance with GAAP, against any liabilities under indemnification
obligations associated with such sales and mergers (provided that, to the extent
and at such time any such amounts are released from such reserve, such amounts
shall be included in Aggregate Net Cash Proceeds).
"Agreement" means this Credit Agreement, as amended or supplemented from
time to time. References to Articles, Sections, Exhibits, Schedules and the like
refer to the Articles, Sections, Exhibits, Schedules and the like of this
Agreement unless otherwise indicated.
"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, or (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 on the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Rate" means, for any day, with respect to any LIBOR Loan, or
with respect to the Commitment Fees, as the case may be, the applicable rate per
annum set forth on Schedule II under the caption "LIBOR Loan Spread" or
"Commitment Fee Rate", as the case may be, based upon the Average Debt Coverage
Ratio. Each change in the Applicable Rate resulting from a change in the Average
Debt Coverage Ratio shall be effective with respect to all outstanding LIBOR
Loans and with respect to the Commitment Fees on and after the first day of the
calendar month following the date of delivery to the Administrative Agent of the
financial statements required by subsection (a) or (b) (as the case may be) of
Section 7.8 indicating that a change in the Average Debt Coverage Ratio has
occurred, through the date immediately preceding the first day of the calendar
month following the next date of delivery of such financial statements
indicating that another change in the Average Debt Coverage Ratio has occurred.
Notwithstanding the foregoing, but subject to the next sentence, during the
period commencing on the Closing Date and ending on the date immediately
preceding the first day of the calendar month following the date of delivery of
the first such financial statements, the Average Debt Coverage Ratio shall be
deemed to be in Category 2 (as set forth on Schedule II) for purposes of
determining the Applicable Rate. Notwithstanding the foregoing, (a) at any time
during which the Parent has failed to deliver the financial statements required
by either such subsection of Section 7.8, or (b) at any time after the
occurrence and during the continuance of an Event of Default, the Average Debt
Coverage Ratio shall be deemed to be in Category 4 (as set forth on Schedule II)
for purposes of determining the Applicable Rate.
"Assignment and Assumption Agreement" is defined in Section 12.5.
"Augmenting Lender" is defined in Section 2.16.
"Authorization Letter" means the letter agreement executed by the
Borrowers in the form of Exhibit B.
"Average Debt Coverage Ratio" means the ratio of (i) the sum of
indebtedness for borrowed money, indebtedness for the deferred purchase price of
property or services (excluding trade payables in the ordinary course of
business; and excluding wages or other compensation payable to employees of the
Parent or any of its Subsidiaries in the ordinary course of business),
obligations arising under acceptance facilities, and obligations as lessee under
Capital Leases, (in all cases) of the Parent and its Consolidated Subsidiaries
on a consolidated basis as of the last day of each fiscal quarter for four
consecutive fiscal quarters, divided by four; to (ii) consolidated earnings
before interest expense, taxes, depreciation and amortization of the Parent and
its Consolidated Subsidiaries for such period of four consecutive fiscal
quarters. For purposes of this definition only, if such clause (ii) is less than
one dollar, it shall be deemed to be one dollar.
2
"Board" means the Board of Governors of the Federal Reserve System of the
United States of America.
"Borrower" means the Parent, Concord or MWC (as applicable).
"Borrowing" means (in the case of Syndicated Loans) a group of Syndicated
Loans to a single Borrower of a single Type made, converted or continued on the
same date and in the same currency, and as to which a single Interest Period is
in effect or (in the case of Swingline Loans) a Swingline Loan made by the
Swingline Bank on a single date.
"Borrowing Request" means a Syndicated Loan Borrowing Request or a
Swingline Loan Borrowing Request.
"Breakage Event" is defined in Section 4.4.
"Business Day" means any day other than a Saturday, Sunday or day on which
banks in New York City are authorized or required by law to close; provided,
however, that: (a) when used in connection with a LIBOR Loan, the term "Business
Day" shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market; (b) when used in connection with
any Loan denominated in Euros, the term "Business Day" shall also exclude any
day on which the TARGET payment system is not open for settlement of payment in
Euros; and (c) when used in connection with any Loan denominated in a Foreign
Currency other than Euros, the term "Business Day" shall also exclude any day on
which commercial banks and the London foreign exchange market do not settle
payments in the principal financial center where such Foreign Currency is
cleared and settled as determined by the Administrative Agent.
"Calculation Date" means (a) with reference to a particular Foreign
Currency, each day on which a Borrowing in such Foreign Currency is made,
continued or converted; and (b) the last Business Day of each calendar month.
"Capital Expenditures" means for any period, the dollar amount of gross
expenditures (including obligations under Capital Leases) made for fixed assets,
real property, plant and equipment, and all renewals, improvements and
replacements thereto (but not repairs thereof) incurred during such period, as
determined in accordance with GAAP.
"Capital Lease" means any lease which has been or should be capitalized on
the books of the lessee in accordance with GAAP.
"Cash Collateral Account" is defined in Section 2.13.
"Closing Date" means the date this Agreement has been executed and
delivered by the Borrowers, the Lenders, the Swingline Bank, the Issuing Bank
and the Administrative Agent.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment Fees" is defined in Section 2.7.
"Concord" is defined in the initial paragraph of this Agreement.
"Consolidated Capital Expenditures" means Capital Expenditures of the
Parent and its Consolidated Subsidiaries, as determined on a consolidated basis
in accordance with GAAP.
"Consolidated Net Income" for any fiscal year of the Parent means the
consolidated net income (loss) of the Parent and its Consolidated Subsidiaries
for such fiscal year, determined in accordance with
3
GAAP and after provisions for minority interests, but not including in the
computation of the foregoing any of the following:
(i) extraordinary gains and extraordinary losses;
(ii) any portion of the net income of any Subsidiary which for any
reason is unavailable to pay dividends to the Parent by reason of legal or
contractual restrictions;
(iii) any aggregate net gain (in excess of net losses) exceeding
$200,000 in any fiscal year arising from the sale, exchange or other
disposition of capital assets (such term to include all fixed assets,
whether tangible or intangible, all inventory sold in conjunction with the
disposition of fixed assets, and all securities);
(iv) any write-up of any asset;
(v) any gain or loss arising from the acquisition of any securities
of the Parent or any Subsidiary;
(vi) net income or gain (net of any loss) resulting from
discontinuing or disposing of operations, or prior period adjustments; and
(vii) the income (loss) of any Person accrued prior to the date it
becomes a Subsidiary.
"Consolidated Subsidiary" means any Subsidiary whose accounts are or are
required to be consolidated with the accounts of the Parent in accordance with
GAAP.
"Consolidated Tangible Net Worth" means Tangible Net Worth of the Parent
and its Consolidated Subsidiaries, as determined on a consolidated basis in
accordance with GAAP.
"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 ownership of voting securities, by contract or otherwise, and the
terms "Controlling" and "Controlled" shall have meanings correlative thereto.
"Core Business" means the business of designing, manufacturing and
distributing watches, jewelry and other accessories (including the operation of
retail stores to distribute the same), other businesses related thereto, or
businesses that in the judgment of the board of directors of the Parent are
derived from the exploitation by the Parent of its trademarks, including the
operation of retail stores to distribute products utilizing the same.
"Debt" means, with respect to any Person: (a) indebtedness of such Person
for borrowed money; (b) indebtedness for the deferred purchase price of property
or services (except trade payables in the ordinary course of business; and
except wages or other compensation payable to employees of such Person in the
ordinary course of business); (c) the face amount of any outstanding letters of
credit issued for the account of such Person; (d) obligations arising under
acceptance facilities; (e) (without duplication of other Debt) guaranties,
endorsements (other than for collection in the ordinary course of business) and
other contingent obligations to purchase, to provide funds for payment, to
supply funds to invest in any Person, or otherwise to assure a creditor against
loss; (f) obligations secured by any Lien on property of such Person; and (g)
obligations of such Person as lessee under Capital Leases.
"Debt Coverage Ratio" for any fiscal year means the ratio of (a) the sum
of indebtedness for borrowed money, indebtedness for the deferred purchase price
of property or services (excluding trade payables in the ordinary course of
business; and excluding wages or other compensation payable to employees of the
Parent or any of its Subsidiaries in the ordinary course of business),
obligations arising
4
under acceptance facilities, and obligations as lessee under Capital Leases, (in
all cases) of the Parent and its Consolidated Subsidiaries on a consolidated
basis as of the last day of such fiscal year; to (b) consolidated earnings
before interest expense, taxes, depreciation and amortization of the Parent and
its Consolidated Subsidiaries for such fiscal year.
"Default" means any event which with the giving of notice or lapse of
time, or both, would become an Event of Default.
"Default Rate" is defined in Section 2.9.
"Designated Sales" means (i) sales of assets of the Parent or any
Subsidiary that are prohibited by Section 8.7 (excluding clause (f) thereof),
and (ii) sales of all the shares of capital stock of any Subsidiary that are
prohibited by Section 8.8 (excluding clause (d) thereof); and (iii) cash mergers
of a Subsidiary into another entity (that is, where the outstanding shares of
such Subsidiary are entirely converted to cash upon such merger) that are
prohibited by Section 8.10 (excluding clause (c) thereof), provided that such
sales and mergers shall be for fair market value and on an arms'-length basis,
and provided further that:
(a) 50% of the excess over $20,000,000 of the Aggregate Net Cash
Proceeds of all such sales and mergers shall (immediately upon receipt by
the Parent or such Subsidiary) be applied to reduce the Swingline Loans
and the Syndicated Loans and to secure the L/C Exposure (in the sequence
and manner provided in Section 8.1(i)), and the Total Revolving Credit
Commitment shall be permanently reduced by an amount equal to 50% of such
excess over $20,000,000; and
(b) in the case of each such sale and merger where the Aggregate Net
Cash Proceeds thereof is $10,000,000 or more: the Parent shall provide to
the Administrative Agent at least 20 days before the effective date of
such sale or merger, for distribution to the Lenders, a pro-forma
consolidated balance sheet and income statement as to the Parent and its
Consolidated Subsidiaries after giving effect to such sale or merger,
together with a written certification of the Parent that such sale or
merger will not result in a Default or an Event of Default, either
immediately or (based upon the Parent's reasonable and good faith
projections) at any time thereafter prior to the Maturity Date.
"Dollar Equivalent" means, on any date of determination, with respect to
any amount in a particular Foreign Currency, the equivalent in dollars of such
amount, as determined by the Administrative Agent pursuant to Section 1.4 using
the Exchange Rate with respect to such Foreign Currency then in effect under
Section 1.4.
"dollars" or "$" means lawful money of the United States of America.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including, without limitation, ambient air, surface water, ground
water, or land, or otherwise relating to the manufacture, processing
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, including any rules and regulations promulgated
thereunder.
"ERISA Affiliate" means any corporation or trade or business which is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which the Parent is a member, or (ii)
5
solely for purposes of potential liability under Section 302(c)(11) of ERISA and
Section 412(c)(11) of the Code and the lien created under Section 302(f) of
ERISA and Section 412(n) of the Code, described in Section 414(m) or (o) of the
Code of which the Parent is a member.
"Euro" means the single currency of the European Union as constituted by
the Treaty on European Union and as referred to in the legislative measures of
the European Union for the introduction of, changeover to or operation of the
Euro in one or more member states.
"Event of Default" is defined in Section 10.1.
"Exchange Rate" means on any day, with respect to any determination of the
equivalent in dollars of a particular Foreign Currency (or in a particular
Foreign Currency of dollars), the rate at which such Foreign Currency may be
exchanged into dollars (or dollars into such Foreign Currency, as applicable),
as set forth at approximately 11:00 a.m., London time, on such day on the
Reuters World Currency Page for the relevant currency. In the event that such
rate does not appear on any Reuters World Currency Page, the Exchange Rate shall
be determined by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the Administrative Agent and
the Parent, or, in the absence of such agreement, such Exchange Rate shall
instead be the arithmetic average of the spot rates of exchange of the
Administrative Agent in the market where its foreign currency exchange
operations in respect of such Foreign Currency are then being conducted, at or
about 10:00 a.m., local time, on such date for the purchase of dollars (or such
Foreign Currency, as applicable) for delivery two Business Days later; provided
that if at the time of any such determination, for any reason, no such spot rate
is being quoted, the Administrative Agent may use any reasonable method it deems
appropriate to determine such rate, and such determination shall be conclusive
absent manifest error.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Swingline Bank, the Issuing Bank or any other recipient of any
payment to be made by or on account of any obligation of any Borrower hereunder,
(a) (i) income or franchise taxes imposed on (or measured by) its net income,
and (ii) any branch profits taxes or similar taxes imposed, and (b) in the case
of a Lender organized under the laws of a jurisdiction other than the United
States (a "foreign Lender"), any withholding tax that is imposed on amounts
payable hereunder to such foreign Lender to the extent such tax is in effect and
would apply as of the date such foreign Lender becomes a party to this Agreement
or designates a new Lending Office, or that is attributable to such foreign
Lender's failure to comply with Section 11.14.
"Facility Documents" means this Agreement, the Notes, the Authorization
Letter, the Parent Guarantee and each Subsidiary Guarantee.
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the nearest 1/100th 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 nearest 1/100th of 1%) of the quotations for the day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Fee Letter" means the Fee Letter dated April 15, 2003 between the Parent
and the Administrative Agent.
"Fees" means the Commitment Fees, the Administrative Agent Fees, the L/C
Participation Fees and the Issuing Bank Fees.
"Foreign Currency" means Euros or Swiss francs (as applicable).
6
"Foreign Currency Borrowing" means a Borrowing comprised of Syndicated
Loans denominated in a particular Foreign Currency.
"Foreign Currency Equivalent" means, on any date of determination, with
respect to an amount in dollars, the amount of the applicable Foreign Currency
that may be purchased with such amount of dollars at the Exchange Rate with
respect to such Foreign Currency on such date, as determined by the
Administrative Agent.
"Foreign Currency Loan" means a Syndicated Loan denominated in a
particular Foreign Currency.
"Foreign Currency Sublimit Dollar Amount" means $50,000,000, as the same
may be increased from time to time pursuant to Section 2.16.
"Foreign Subsidiary Borrower" means Concord or MWC (as applicable).
"Forfeiture Proceeding" means any action or proceeding against the Parent
or any of its Subsidiaries before any court, governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, or
the receipt of notice by any such party that any of them is a suspect in or a
target of any governmental investigation, as to which there is a reasonable
possibility of a determination adverse to the Parent or such Subsidiary and
which (if determined adversely to the Parent or such Subsidiary) would, in any
one case or in the aggregate, materially adversely affect the financial
condition, operations or business of the Parent and its Subsidiaries taken as a
whole or the ability of any Borrower to perform its obligations under the
Facility Documents to which it is a party.
"Future Permitted Private Placement Debt" means unsecured indebtedness for
money borrowed by the Parent that is privately placed with one or more
institutional investors after the Closing Date (including the indebtedness
evidenced by the Prudential Shelf Notes), provided that (a) the aggregate
principal amount of such indebtedness does not exceed $40,000,000; (b) not more
than 20% of the original principal amount of any such indebtedness shall be
scheduled to mature or to be repaid in any fiscal year prior to the Maturity
Date; and (c) the terms and conditions associated with such indebtedness
(whether in the notes evidencing such indebtedness, or in the note purchase
agreements or similar agreements pursuant to which such indebtedness is issued,
or otherwise) are not more restrictive of the Parent or any of its Subsidiaries
than the corresponding terms and conditions of this Agreement (which
determination as to restrictiveness may be made by the Administrative Agent in
its reasonable judgment); provided further however that the foregoing clause (b)
shall not apply to the indebtedness evidenced by the Prudential Shelf Notes; and
provided further that the foregoing clause (c) shall not apply to the
indebtedness evidenced by the Prudential Shelf Notes unless the Note Purchase
and Private Shelf Agreement dated March 21, 2001 between the Parent and The
Prudential Insurance Company of America is hereafter amended.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect on the date hereof, applied on a basis consistent with
those used in the preparation of the financial statements referred to in Section
6.5.
"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 authority exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Xxxxxxxx Group" means the group consisting of Gedalio Xxxxxxxx, his
spouse, each of their estates and their issue; and Xxxxxx Xxxxxxxx, his spouse,
each of their estates and their issue; and every Person (other than an
individual) Controlled by any of the foregoing.
"Guarantors" means the Parent Guarantor and each Subsidiary Guarantor.
7
"Hazardous Material" is defined in Section 6.12.
"Inactive Subsidiary" means a Subsidiary of the Parent that has (and only
for so long as it has) assets of less than $1,000,000; provided, however, that
(i) there shall not be more than ten Inactive Subsidiaries at any time during
the term of this Agreement and (ii) the assets of all Inactive Subsidiaries in
the aggregate shall not exceed $4,000,000.
"including" is deemed to mean "including without limitation".
"Increasing Lender" is defined in Section 2.16.
"Incremental TNW Amount" means, as of any date of determination, an amount
equal to the product of (a) Consolidated Net Income for each fiscal year of the
Parent ended after the Closing Date and on or before such date of determination,
if Consolidated Net Income for such fiscal year is a positive number, multiplied
by (b) 50%.
"Indemnified Taxes" means Taxes arising from any payment made hereunder or
from the execution, delivery or enforcement of, or otherwise with respect to,
this Agreement other than Excluded Taxes and Other Taxes.
"Indemnitee" is defined in Section 12.3(b).
"Initial Subsidiary Guarantees" means the Subsidiary Guarantees executed
and delivered by the Initial Subsidiary Guarantors (respectively) on the Closing
Date in favor of the Lenders, the Swingline Bank, the Issuing Bank and the
Administrative Agent, in respect of the obligations of the Parent under this
Agreement and the other Facility Documents.
"Initial Subsidiary Guarantors" means Movado Retail Group, Inc., a New
Jersey corporation, and Movado LLC, a Delaware limited liability company.
"Interest Coverage Ratio" for any period means the ratio of (a)
consolidated earnings before interest expense and taxes of the Parent and its
Consolidated Subsidiaries for such period, to (b) cash interest paid during such
period by the Parent and its Consolidated Subsidiaries on a consolidated basis;
provided, however, that if such an interest payment on the Prudential Existing
Notes and/or any Future Permitted Private Placement Debt is scheduled to be made
on a non-Business Day and is instead actually made on the next succeeding
Business Day, and if a determination date (as described in Section 9.2) occurs
on such non-Business Day or on any subsequent non-Business Day prior to such
next succeeding Business Day, then such interest payment will be deemed to have
been made on such determination date (provided that there is no amendment of the
payment schedule of any of the Prudential Existing Notes or any Future Permitted
Private Placement Debt).
"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
the Maturity Date; (b) with respect to any LIBOR 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 LIBOR Borrowing with an Interest Period of more than three months'
duration, each day that would have been an Interest Payment Date had successive
Interest Periods of three months' duration been applicable to such Borrowing,
and in addition, the date of any prepayment of such Borrowing or the date of any
conversion of such Borrowing to a Borrowing of a different Type; and (c) with
respect to a Swingline Loan, the day that such Loan is required to be repaid
"Interest Period" means, as to any LIBOR Borrowing, the period commencing
on the date of such Borrowing (or in the case of the conversion of any ABR
Borrowing into a LIBOR Borrowing, the date of such conversion or in the case of
a continuation of any LIBOR Borrowing as a LIBOR Borrowing, the date of such
continuation) and ending on the numerically corresponding day (or, if there is
no numerically corresponding day, on the last day) in the calendar month that is
1, 2, 3, 6 or (subject to availability for
8
each Lender) 9 or 12 months thereafter, as the Parent may elect; provided,
however, 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. Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.
"Issuing Bank" means JPMorgan Chase Bank and its successors. The Issuing
Bank may, in its reasonable 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.
"Issuing Bank Fees" is defined in Section 3.9.
"L/C Commitment" means the commitment of the Issuing Bank to issue Letters
of Credit pursuant to Article 3.
"L/C Disbursement" means a payment or disbursement 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
principal amount of all L/C Disbursements that have not yet been reimbursed at
such time. The L/C Exposure of any Lender at any time means its Pro Rata
Percentage of the aggregate L/C Exposure at such time.
"L/C Participation Fee" is defined in Section 3.9.
"Lenders" means (a) the financial institutions listed on Schedule I (other
than any such financial institution that has ceased to be a party hereto
pursuant to an Assignment and Assumption Agreement) and (b) any financial
institution that has become a party hereto pursuant to an Assignment and
Assumption Agreement or pursuant to Section 2.16.
"Lending Office" means, for each Lender and for each Type of Loan, the
lending office of such Lender (or of an Affiliate of such Lender) designated as
such for such Type of Loan on its signature page hereof or such other office of
such Lender (or of an Affiliate of such Lender) as such Lender may from time to
time specify to the Administrative Agent and the Parent as the office by which
its Loans of such Type are to be made and maintained.
"Letter of Credit" means any letter of credit issued pursuant to Article
3.
"LIBO Rate" means (a) with respect to any LIBOR Borrowing denominated in
dollars, 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
determined by the Administrative Agent, in consultation with the Parent, 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; and (b) with respect to any LIBOR Borrowing denominated in a
Foreign Currency, for any Interest Period, the rate determined by reference to
the British Bankers' Association Interest Settlement Rates (as reflected on the
applicable Telerate service) at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period, as the rate for
deposits in such Foreign Currency 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 LIBOR Borrowing for such
Interest Period shall be the rate at which the Administrative Agent is offered
deposits in dollars of, or deposits in the applicable
9
Foreign Currency for the Foreign Currency Equivalent of, $5,000,000 and for a
maturity comparable to such Interest Period 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.
"LIBOR Borrowing" means a Borrowing comprised of LIBOR Loans.
"LIBOR Loan" means any Syndicated Loan bearing interest at a rate
determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article 2.
"Lien" means any lien (statutory or otherwise), security interest,
mortgage, deed of trust, priority, pledge, charge, conditional sale, title
retention agreement, financing lease or other encumbrance or similar right of
others, or any agreement to give any of the foregoing.
"Loans" means Syndicated Loans and Swingline Loans.
"MWC" is defined in the initial paragraph of this Agreement.
"Maturity Date" means the third anniversary of the Closing Date.
"Multiemployer Plan" means a Plan defined as such in Section 3(37) of
ERISA to which contributions have been made by the Parent or any ERISA Affiliate
and which is covered by Title IV of ERISA.
"Notes" means the Syndicated Loan Notes and the Swingline Loan Note.
"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.
"Parent" is defined in the initial paragraph of this Agreement.
"Parent Guarantee" means the guarantee executed and delivered by the
Parent on the Closing Date in favor of the Lenders and the Administrative Agent,
in respect of the obligations of Concord and MWC (respectively) under this
Agreement and the other Facility Documents, in substantially the form attached
hereto as Exhibit D-2.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"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 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 commercial paper maturing within 270 days from
the date of acquisition thereof and having, at such date of acquisition,
the highest credit rating obtainable from Standard & Poor's Ratings
Service or from Xxxxx'x Investors Service, Inc.;
(c) investments in certificates of deposit, banker's acceptances and
time deposits maturing within one year from the date of acquisition
thereof issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States of America or any State
thereof that has a combined capital and surplus and undivided profits of
not less than $500,000,000; and
10
(d) other investment instruments approved in writing by the Required
Lenders and offered by financial institutions which have a combined
capital and surplus and undivided profits of not less than $500,000,000.
"Person" means an individual, partnership, corporation, business trust,
joint stock company, limited liability company, trust, unincorporated
association, joint venture, governmental authority or other entity of whatever
nature.
"Plan" means any employee benefit or other plan established or maintained,
or to which contributions have been made, by the Parent or any ERISA Affiliate
and which is covered by Title IV of ERISA, other than a Multiemployer Plan.
"Prime Rate" means the rate of interest per annum publicly announced from
time to time by the entity which is the Administrative Agent as its prime rate
in effect at its principal office in New York City; each change in such prime
rate shall be effective on the date such change is publicly announced as being
effective.
"Pro Rata Percentage" of any Lender at any time means the percentage of
the Total Revolving Credit Commitment represented by such Lender's Revolving
Credit Commitment (or, if the Lenders' Revolving Credit Commitments shall have
expired or been terminated in accordance with this Agreement and the Aggregate
Credit Exposure is greater than zero, such percentage immediately prior to such
expiration or termination, giving effect to any assignments by or to such Lender
pursuant to Section 12.5.)
"Prudential Existing Notes" means (a) the promissory notes of the Parent
in the original aggregate principal amount of $40,000,000 issued pursuant to the
Note Agreement dated as of November 9, 1993 between the Parent and The
Prudential Insurance Company of America, and (b) the Series A promissory notes
of the Parent in the original aggregate principal amount of $25,000,000 issued
pursuant to the Note Purchase and Private Shelf Agreement dated as of November
30, 1998 between the Parent and The Prudential Insurance Company of America.
"Prudential Shelf Notes" means, to the extent hereafter actually issued,
the shelf promissory notes of the Parent in the aggregate principal amount of up
to $40,000,000 authorized (although not issued) pursuant to the Note Purchase
and Private Shelf Agreement dated as of March 21, 2001 between the Parent and
The Prudential Insurance Company of America.
"Rate" is defined in the definition of the term "Type" in this Section
1.1.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Release" is defined in Section 6.12.
"Required Lenders" means, at any time, Lenders having Syndicated Loan
Exposure, L/C Exposure and unused Revolving Credit Commitments representing at
least 56% of the sum of all Syndicated Loan Exposure, L/C Exposure and unused
Revolving Credit Commitments at such time.
"Required Payment" is defined in Section 11.13.
"Revolving Credit Commitment" means, with respect to each Lender, the
commitment of such Lender to make Syndicated Loans hereunder as set forth on
Schedule I, or in the Assignment and Assumption Agreement pursuant to which such
Lender assumed its Revolving Credit Commitment, or pursuant to Section 2.16, as
applicable, as the same may be (a) reduced from time to time pursuant to
11
Section 2.10, (b) reduced or increased from time to time pursuant to assignments
by or to such Lender pursuant to Section 12.5 and/or (c) increased from time to
time pursuant to Section 2.16.
"Statutory Reserves" 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, liquid asset or similar
percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by any Governmental Authority of
the jurisdiction of such currency to which the entity which is the
Administrative Agent in such jurisdiction is subject for any category of
deposits or liabilities customarily used to fund loans in such currency or by
reference to which interest rates applicable to Loans in such currency are
determined. Such reserve, liquid asset or similar percentages shall, in the case
of dollars, include those imposed by the Board with respect to the Adjusted LIBO
Rate for Eurocurrency Liabilities (as defined in Regulation D of the Board).
LIBOR Loans shall be deemed to constitute Eurocurrency Liabilities and to be
subject to such reserve requirements without benefit of or credit from
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D or any other applicable law, rule or regulation.
Statutory Reserves shall be adjusted automatically on and as of the effective
date of any change in any reserve percentage.
"Subsidiary" means, with respect to any Person, any corporation or other
entity of which at least a majority of the securities or other ownership
interests having ordinary voting power (absolutely or contingently) for the
election of directors or other persons performing similar functions are at the
time owned directly or indirectly by such Person. Unless the context otherwise
requires, references in this Agreement to a Subsidiary mean a Subsidiary of the
Parent.
"Subsidiary Guarantee" means a guarantee executed and delivered by a
Subsidiary Guarantor in favor of the Lenders, the Swingline Bank, the Issuing
Bank and the Administrative Agent, in respect of the obligations of the Parent
under this Agreement and the other Facility Documents, in substantially the form
attached hereto as Exhibit D-1 (including the Initial Subsidiary Guarantees).
"Subsidiary Guarantors" means the Initial Subsidiary Guarantors and each
other Subsidiary that becomes a Subsidiary Guarantor pursuant to Section 7.9.
"Swingline Bank" means JPMorgan Chase Bank and its successors.
"Swingline Loan Borrowing Request" means a request by the Parent for a
Swingline Loan in accordance with the terms of Section 2.4 in form satisfactory
to the Administrative Agent.
"Swingline Loan Note" is defined in Section 2.6.
"Swingline Loans" means the revolving loans made by the Swingline Bank to
the Parent pursuant to Section 2.4. Each Swingline Loan shall be an ABR Loan.
"Swiss francs" means lawful money of Switzerland.
"Syndicated Loan Borrowing Request" means a request by the Parent (on its
own behalf or on behalf of the applicable Foreign Subsidiary Borrower) for
Syndicated Loans in accordance with the terms of Section 2.3 in form
satisfactory to the Administrative Agent.
"Syndicated Loan Exposure" means, with respect to any Lender at any time,
the aggregate principal amount at such time of all outstanding Syndicated Loans
of such Lender denominated in dollars plus the Dollar Equivalent at such time of
the aggregate principal amount at such time of all outstanding Syndicated Loans
of such Lender that are Foreign Currency Loans.
"Syndicated Loan Note" is defined in Section 2.6.
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"Syndicated Loans" means the revolving loans made by the Lenders to the
Parent or a Foreign Subsidiary Borrower (as the case may be) pursuant to Section
2.1. Each Syndicated Loan to the Parent shall be denominated in dollars and
shall be outstanding as a LIBOR Loan or an ABR Loan, and each Syndicated Loan to
a Foreign Subsidiary Borrower shall be outstanding as a Foreign Currency Loan.
"Tangible Net Worth" of a Person means, at any date of determination
thereof, the excess of total assets of such Person over total liabilities of
such Person, excluding, however, (A) from the determination of total assets: (i)
all assets which would be classified as intangible assets under GAAP, including,
without limitation, goodwill (whether representing the excess of cost over book
value of assets acquired or otherwise), patents, trademarks, trade names,
copyrights, franchises, and deferred charges (including, without limitation,
unamortized debt discount and expense, organization cost, and research and
development costs); and (ii) any write-up in the book value of any asset since
January 31, 2003; and (B) any foreign exchange translation adjustment in the
cumulative amount, and any adjustments to other comprehensive income for
derivative instruments and other hedging activities, that would (in each case)
be properly shown in the Shareholders' Equity section of such Person's balance
sheet prepared in accordance with GAAP.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Total Revolving Credit Commitment" means, at any time, the aggregate
amount of the Revolving Credit Commitments, as in effect at such time.
"Type", when used in respect of any Syndicated Loan or Borrowing of
Syndicated Loans, shall refer to the Rate by reference to which interest on such
Loan or on the Loans comprising such Borrowing is determined and the currency in
which such Loan or the Loans comprising such Borrowing are denominated. For
purposes hereof, the term "Rate" means the Adjusted LIBO Rate or the Alternate
Base Rate, and the term "currency" means dollars, Euros or Swiss francs.
"Unfunded Benefit Liabilities" means, with respect to any Plan, the amount
(if any) by which the present value of all benefit liabilities (within the
meaning of Section 4001(a)(16) of ERISA) under the Plan exceeds the fair market
value of all Plan assets allocable to such benefit liabilities, as determined on
the most recent valuation date of the Plan and in accordance with the provisions
of ERISA for calculating the potential liability of the Parent or any ERISA
Affiliate under Title IV of ERISA.
Section 1.2. Accounting Terms. All accounting terms used herein and not
specifically defined herein shall be construed in accordance with GAAP, and all
financial data required to be delivered hereunder shall be prepared in
accordance with GAAP. If any change in GAAP, as in effect on the date hereof,
occurs after the date of this Agreement, compliance with all financial covenants
contained herein shall continue to be determined in accordance with GAAP as in
effect on the date hereof, except to the extent that the Parent and the Required
Lenders otherwise agree in writing.
Section 1.3. 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
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections 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
13
and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
Section 1.4. Determination of Exchange Rates.(a) (a) Not later than 1:00
p.m., New York City time, on each Calculation Date, the Administrative Agent
shall (i) determine the Exchange Rate as of such Calculation Date and (ii) give
notice thereof to the Lenders and the Parent (on behalf of itself and the
Foreign Subsidiary Borrowers). The Exchange Rate so determined shall become
effective on the first Business Day immediately following the relevant
Calculation Date (a "Recalculation Date"), shall remain effective until the next
succeeding Recalculation Date, and shall for all purposes of this Agreement
(other than Section 2.2, Section 2.11(c), Section 2.13(c), Section 12.16 or any
other provision expressly requiring the use of a current Exchange Rate) be the
Exchange Rate employed in converting any amounts between dollars and a
particular Foreign Currency.
(b) Not later than 5:00 p.m., New York City time, on each
Recalculation Date, the Administrative Agent shall (i) determine the aggregate
amount of the Dollar Equivalents of the principal amounts of Loans that are
Foreign Currency Loans then outstanding (after giving effect to any such Loans
made or repaid on such date) and (ii) notify the Lenders and the Parent (on
behalf of itself and the Borrowers) of the results of such determination.
ARTICLE 2. THE LOANS.
Section 2.1. Syndicated Loans. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make, at any time and from time to time
from the Closing Date to (but excluding) the earlier of the Maturity Date or the
termination of the Revolving Credit Commitment of such Lender in accordance with
the terms hereof, (a) Syndicated Loans to the Parent denominated in dollars, (b)
Syndicated Loans to Concord denominated in a Foreign Currency and (c) Syndicated
Loans to MWC denominated in a Foreign Currency, in an aggregate principal amount
at any time outstanding that will not result in:
(i) the sum of (x) such Lender's Syndicated Loan Exposure, plus (y)
such Lender's L/C Exposure, plus (z) such Lender's Pro Rata Percentage of
all outstanding Swingline Loans exceeding such Lender's Revolving Credit
Commitment, or
(ii) the Dollar Equivalent of such Lender's outstanding Foreign
Currency Loans exceeding such Lender's Pro Rata Percentage of the
Foreign Currency Sublimit Dollar Amount; or
(iii) the Aggregate Credit Exposure exceeding the Total Revolving
Credit Commitment.
Within the limits set forth in the preceding sentence and subject to the terms,
conditions and limitations set forth herein, the Borrowers may borrow, pay or
prepay and reborrow Syndicated Loans.
Section 2.2. Making of Syndicated Loans.(a) (a) Each Syndicated Loan shall
be made as part of a Borrowing consisting of Syndicated Loans made by the
Lenders ratably in accordance with their respective Revolving Credit
Commitments; provided, however, that the failure of any Lender to make any
Syndicated Loan shall not in itself relieve any other Lender of its obligation
to lend hereunder (it being understood, however, that no Lender shall be
responsible for the failure of any other Lender to make any Syndicated Loan
required to be made by such other Lender). The Syndicated Loans comprising any
Borrowing shall be in an aggregate principal amount that is an integral multiple
of $250,000 and that is not less than $1,000,000 (in the case of each ABR
Borrowing) or $2,000,000 (in the case of a LIBOR Borrowing denominated in
dollars) or the Foreign Currency Equivalent of $3,000,000 (in the case of a
LIBOR Borrowing denominated in a particular Foreign Currency); provided however,
that an ABR Borrowing may be in an amount that is equal to the remaining balance
of the Total Revolving Credit
14
Commitment. Syndicated Loans that are made pursuant to any Foreign Currency
Borrowing shall be made in the particular Foreign Currency specified in the
applicable Syndicated Loan Borrowing Request in an aggregate principal amount
equal to the Foreign Currency Equivalent of the dollar amount specified in such
Syndicated Loan Borrowing Request (as determined by the Administrative Agent as
of the day that is three Business Days before the day such Loans are made using
the current Exchange Rate as of the day that is three Business Days before the
day such Loans are made, which determination shall be conclusive absent manifest
error).
(b) Subject to Sections 4.1 and 4.3, each Borrowing of Syndicated
Loans denominated in dollars shall be comprised entirely of ABR Loans or LIBOR
Loans as the Parent may request pursuant to Section 2.3; and each Borrowing of
Syndicated Loans in a particular Foreign Currency shall be comprised entirely of
LIBOR Loans. Each Lender may at its option make any LIBOR Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the obligation of the
applicable Borrower to repay such Loan in accordance with the terms of this
Agreement. Borrowings of more than one Type may be outstanding at the same time;
provided, however, that no Borrower shall be entitled to request any Borrowing
that, if made, would result in more than twelve LIBOR Borrowings outstanding
hereunder at any time. Borrowings having different Interest Periods (regardless
of whether they commence on the same date), or denominated in different
currencies, or made by different Borrowers, shall be considered separate
Borrowings.
(c) Each Lender shall make each Syndicated Loan denominated in
dollars 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, on such date
to the account of the Administrative Agent most recently designated by it for
such purpose by notice to the Lenders. Each Lender shall make each Syndicated
Loan denominated in a Foreign Currency to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 12:00
noon, London time (or the time of such other city designated by the
Administrative Agent), on such date to the account of the Administrative Agent
most recently designated by it for such purpose by notice to the Lenders. The
Administrative Agent will make such Loans available to the applicable Borrower
by promptly crediting the amounts so received, in like funds, to an account of
such Borrower maintained with (i) the Administrative Agent in New York City in
the case of such Loans denominated in dollars or (ii) the Administrative Agent
(or its designee) in London (or such other city as the Administrative Agent may
in its reasonable judgment designate in respect of particular Foreign Currency
Loans) in the case of Foreign Currency Loans, in each case designated by the
Parent (on its own behalf or on behalf of the applicable Foreign Subsidiary
Borrower) in the applicable Syndicated Loan Borrowing Request; or if a Borrowing
shall not occur on such date because any condition precedent herein specified
shall not have been met, the Administrative Agent shall return the amounts so
received to the respective Lenders.
(d) Notwithstanding any other provision of this Agreement, no
Borrower shall be entitled to request any Borrowing of Syndicated Loans that are
LIBOR Loans if the Interest Period requested with respect thereto would end
after the Maturity Date.
Section 2.3. Borrowing Procedure as to Syndicated Loans. In order to
request a Borrowing of Syndicated Loans the Parent (on its own behalf or on
behalf of the applicable Foreign Subsidiary Borrower) shall hand deliver or
telecopy to the Administrative Agent a duly completed Syndicated Loan Borrowing
Request (a) in the case of a LIBOR Borrowing, not later than 11:00 a.m., New
York City time (in the case of a Borrowing denominated in dollars), or 11:00
a.m., London time (in the case of a Borrowing denominated in a Foreign
Currency), three Business Days before a proposed Borrowing, and (b) in the case
of an ABR Borrowing, not later than 12:00 noon, New York City time, one Business
Day before a proposed Borrowing. Notwithstanding the immediately preceding
sentence, the Administrative Agent agrees that it will (subject to the
Authorization Letter) accept from the Parent a Syndicated Loan Borrowing Request
by telephone by the applicable date and time specified in the immediately
preceding sentence, provided that the same is confirmed by the Parent to the
Administrative Agent in writing promptly (and in all events on the same day as
such telephone communication). Each Syndicated Loan Borrowing Request shall be
irrevocable, shall be signed by the Parent (on its own behalf or on behalf of
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the applicable Foreign Subsidiary Borrower), shall refer to this Agreement and
shall specify the following information: (a) that such Request relates to
Syndicated Loans and not a Swingline Loan; (b) whether the Borrowing then being
requested is to be a LIBOR Borrowing or an ABR Borrowing; (c) the date of such
Borrowing (which shall be a Business Day); (d) the number and location of the
account to which funds are to be disbursed (which shall be an account that
complies with the requirements of Section 2.2(c)); (e) the amount of such
Borrowing (which shall be expressed in dollars, regardless of whether such
Borrowing is a Foreign Currency Borrowing); (f) whether such Borrowing is to be
a Borrowing denominated in dollars or in a Foreign Currency (and, if a Foreign
Currency, identifying the Foreign Currency); (g) if such Borrowing is to be a
LIBOR Borrowing, the Interest Period or Periods with respect thereto; and (h)
the identity of the Borrower of such Borrowing; provided, however, that
notwithstanding any contrary specification in any Syndicated Loan Borrowing
Request, each requested Borrowing of Syndicated Loans shall comply with the
requirements set forth in Section 2.2. If no election (or an incomplete
election) as to the Type of Borrowing is specified in any such notice, then the
requested Borrowing shall be an ABR Borrowing if such Borrowing is denominated
in dollars. If no Interest Period with respect to any LIBOR Borrowing is
specified in any such notice, then the Borrower shall be deemed to have selected
an Interest Period of one month's duration. The Administrative Agent shall
promptly advise the Lenders of any notice given pursuant to this Section 2.3
(and the contents thereof), and of each Lender's portion of the requested
Borrowing, and (in the case of a Foreign Currency Borrowing) of the particular
Foreign Currency in which it is to be denominated and the Foreign Currency
Equivalent of the specified dollar amount of such Borrowing and the Exchange
Rate utilized to determine such Foreign Currency Equivalent.
Section 2.4. Swingline Loans.(a) (a) Subject to the terms and conditions
and relying upon the representations and warranties herein set forth, the
Swingline Bank agrees to make Swingline Loans to the Parent, at any time and
from time to time on and after the date hereof until two Business Days before
the Maturity Date, in dollars, in an aggregate principal amount at any time
outstanding that will not result in:
(i) the aggregate principal amount of Swingline Loans being in
excess of $10,000,000, or
(ii) the Aggregate Credit Exposure exceeding the Total
Revolving Credit Commitment;
provided, however, that the Swingline Bank shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within such limits,
and subject to the terms, conditions and limitations set forth herein, the
Parent may borrow, pay or prepay and reborrow Swingline Loans from the Swingline
Bank.
(b) The Swingline Loans shall be made in dollars and maintained as
ABR Loans.
(c) Each Borrowing of a Swingline Loan shall be in an amount not
less than $1,000,000 and shall be in integral multiples of $250,000.
(d) In order to request a Borrowing of a Swingline Loan, the Parent
shall hand deliver or telecopy to the Administrative Agent a duly completed
Swingline Loan Borrowing Request not later than 11:00 a.m., New York City time,
on the Business Day on which the proposed Borrowing is to be made.
Notwithstanding the immediately preceding sentence, the Administrative Agent
agrees that it will (subject to the Authorization Letter) accept from the Parent
a Swingline Loan Borrowing Request by telephone by the applicable date and time
specified in the immediately preceding sentence, provided that the same is
confirmed by the Parent to the Administrative Agent in writing promptly (and in
all events on the same day as such telephone communication). Each Swingline Loan
Borrowing Request shall be irrevocable, shall be signed on behalf of the Parent,
shall refer to this Agreement and shall state (i) that the requested Borrowing
is to be of a Swingline Loan, and (ii) the amount of such Borrowing, and (iii)
the date of such Borrowing (which is to be a Business Day). The Administrative
Agent shall promptly notify the Swingline Bank of such Swingline Loan Borrowing
Request. On the date so specified, the Swingline Bank shall make available the
amount of the Swingline Loan to be made by it on such date to the
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Administrative Agent, in immediately available funds, at an account designated
and maintained by the Administrative Agent. The amount so received by the
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Parent by depositing the same in an account
of the Parent maintained at the Administrative Agent.
Section 2.5. Participations by All Lenders in Swingline Loans. The
Swingline Bank 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 Lenders to
acquire participations on such Business Day in all or a portion of the Swingline
Loans outstanding. Such notice shall specify the aggregate amount of Swingline
Loans in which the Lenders will participate. Promptly upon receipt of such
notice, the Administrative Agent will give notice thereof to each Lender,
specifying in such notice such Lender's Pro Rata Percentage of such Swingline
Loan or Loans. Each Lender hereby absolutely and unconditionally agrees, upon
receipt of notice as provided above, to pay to the Administrative Agent, for the
account of the Swingline Bank, such Lender's Pro Rata Percentage of such
Swingline Loan or Loans. Each 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 an Event of
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 Lender shall comply with its obligation under this
paragraph by wire transfer of immediately available funds to the Administrative
Agent not later than 2:00 p.m., New York City time, on the day it receives such
notice (or, if such Lender shall have received such notice later than 10:00 a.m.
on any Business Day, then not later than 10:00 a.m. on the following Business
Day). If any Lender does not pay such amount to the Administrative Agent on the
date required by the immediately preceding sentence, such Lender shall
(independently of and in addition to the Parent's obligation to pay interest on
such amount) pay interest on such amount, for each day from and including the
date such amount is so required to be paid by such Lender to but excluding the
date such amount is paid, to the Administrative Agent for the account of the
Swingline Bank at (i) for the first such day, the Federal Funds Effective Rate,
and (ii) for each day thereafter, one percent per annum in excess of the Federal
Funds Effective Rate. The Administrative Agent shall promptly pay to the
Swingline Bank the amounts so received by it from the Lenders. The
Administrative Agent shall notify the Parent of any participations in any
Swingline Loan acquired pursuant to this paragraph. Any amounts received by the
Administrative Agent from the Parent (or other party on behalf of the Parent) in
respect of a Swingline Loan after receipt by the Swingline Bank of the proceeds
of a sale of participations therein shall be promptly remitted by the
Administrative Agent to the Lenders that shall have made their payments pursuant
to this paragraph and to the Swingline Bank, as their interests may appear;
provided that any such payment so remitted shall be repaid to the Administrative
Agent, if and to the extent such payment is required to be refunded to the
Parent for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Parent of any default in the
payment thereof. Notwithstanding the foregoing, (x) a Lender shall not have any
obligation to purchase a participation in a Swingline Loan pursuant to this
paragraph if an Event of Default shall have occurred and be continuing at the
time such Swingline Loan was made and (aa) such Lender or any other Lender shall
have notified the Swingline Bank in writing, at least one Business Day prior to
the time such Swingline Loan was made, that such Event of Default has occurred
and that such notifying Lender will not acquire participations in Swingline
Loans made while such Event of Default is continuing (unless the notifying
Lender shall have withdrawn such notice), or (bb) the Parent shall have notified
the Swingline Bank in writing, at least one Business Day prior to the time such
Swingline Loan was made, that such Event of Default has occurred; and (y) a
Lender shall not have any obligation to purchase a participation pursuant to
this paragraph to the extent of its Pro Rata Percentage of the aggregate amount
of the excess (if any) of Swingline Loans outstanding on the day of a Borrowing
of any Swingline Loan over the limitation in clause (i) or (ii) of Section
2.4(a), unless the Parent subsequently eliminates such excess.
Section 2.6. Repayment of Loans.(a) (a) Each Borrower hereby
unconditionally agrees to pay to the Administrative Agent for the account of
each Lender on the Maturity Date the then unpaid principal amount of each
Syndicated Loan of such Lender to such Borrower. Such obligation of each
Borrower in favor of each Lender shall be evidenced by a promissory note of such
Borrower in favor of such Lender in
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substantially the form of Exhibit A-1 hereto (the "Syndicated Loan Note" of such
Lender as to the applicable Borrower).
(b) The Parent hereby unconditionally agrees to pay to the
Administrative Agent for the account of the Swingline Bank the unpaid principal
amount of each Swingline Loan on the earlier of the Maturity Date or the first
date after such Swingline Loan is made that is the 15th or last day of a
calendar month and is at least two Business Days after such Swingline Loan is
made; provided that on each day that a Syndicated Borrowing by the Parent is
made, the Parent shall pay all Swingline Loans then outstanding. Such obligation
of the Parent in favor of the Swingline Bank shall be evidenced by a single
promissory note of the Parent in favor of the Swingline Bank in the amount of
$10,000,000 in substantially the form of Exhibit A-2 hereto (the "Swingline Loan
Note").
(c) Each Lender and the Swingline Bank shall maintain in accordance
with its usual practice an account or accounts evidencing the indebtedness of
each Borrower to such Lender or the Swingline Bank (as applicable) resulting
from each Loan made by such Lender or the Swingline Bank from time to time,
including the amounts of principal and interest payable and paid to such Lender
or the Swingline Bank from time to time under this Agreement.
(d) The Administrative Agent shall maintain accounts in which it
will record (i) the amount of each Loan made hereunder, the identity of the
Borrower thereof, the Type thereof, the Interest Period applicable thereto, the
currency in which it is made, and whether such Loan is a Syndicated Loan or a
Swingline Loan, (ii) the amount of any principal or interest due and payable or
to become due and payable from each Borrower to each Lender or the Swingline
Bank hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from any Borrower or any Guarantor and each Lender's or the
Swingline Bank's share thereof.
(e) The entries made in the accounts maintained pursuant to
paragraphs (c) and (d) above shall be prima facie evidence of the existence and
amounts of the obligations therein recorded; provided, however, that the failure
of any Lender or the Swingline Bank or the Administrative Agent to maintain such
accounts or any error therein shall not in any manner affect the obligations of
any Borrower to repay its Loans in accordance with their terms.
Section 2.7. Certain Fees.(a) (a) The Parent agrees to pay to each Lender,
through the Administrative Agent, on the last day of March, June, September and
December in each year and on the date on which the Revolving Credit Commitment
of such Lender shall expire or be terminated as provided herein, a commitment
fee equal to the average daily unused amount of the Revolving Credit Commitment
of such Lender during the preceding quarter (or other period commencing with the
Closing Date or ending with the Maturity Date or the date on which the Revolving
Credit Commitment of such Lender shall expire or be terminated) multiplied by
the Applicable Rate for such quarter or other period (appropriately pro-rated,
if the Applicable Rate changes during such quarter or other period). "Usage" of
the Revolving Credit Commitment of a Lender shall include the Syndicated Loans
of such Lender and such Lender's Pro Rata Percentage of the L/C Exposure, but
shall exclude Swingline Loans.
(b) All commitment fees described in subsection (a) of this Section
(the "Commitment Fees") shall be computed on the basis of the actual number of
days elapsed in a year of 360 days. The Commitment Fee due to each Lender shall
commence to accrue on the Closing Date and shall cease to accrue on the date on
which the Revolving Credit Commitment of such Lender shall expire or be
terminated as provided herein.
(c) The Parent agrees to pay to the Administrative Agent, for its
own account, the fees set forth in the Fee Letter at the times and in the
amounts specified therein (the "Administrative Agent Fees").
(d) The Commitment Fees and the Administrative Agent Fees shall be
paid on the dates due in immediately available funds to the Administrative
Agent, for distribution, if and as
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appropriate, among the Lenders. Once paid, none of such Fees shall be refundable
under any circumstances.
Section 2.8. Interest on Loans.(a) (a) Subject to the provisions of
Section 2.9, the Loans comprising each ABR Borrowing (whether of Syndicated
Loans or of a Swingline Loan) shall bear interest at a rate per annum equal to
the Alternate Base Rate. Such interest shall be computed on the basis of the
actual number of days elapsed, over (if such interest is determined on the basis
of the Prime Rate) a year of 365 or 366 days, as the case may be, or (if such
interest is determined on the basis of the Federal Funds Effective Rate) a year
of 360 days.
(b) Subject to the provisions of Section 2.9, the Loans comprising
each LIBOR Borrowing of Syndicated Loans shall bear interest (computed on the
basis of the actual number of days elapsed over a year of 360 days) at a rate
per annum equal to the Adjusted LIBOR Rate for the Interest Period in effect for
such Borrowing plus the Applicable Rate in effect from time to time.
(c) Interest on each Loan shall be payable by the Borrower of such
Loan on the Interest Payment Dates applicable to such Loan except as otherwise
provided in this Agreement. The applicable Alternate Base Rate or applicable
Adjusted LIBOR Rate for each Interest Period or day within an Interest Period,
as the case may be, shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
Section 2.9. Default Interest. If any Borrower shall default in the
payment required to be made by it of the principal of or interest on any Loan or
any other amount becoming due under this Agreement (the "Defaulted Amount"), at
stated maturity, by acceleration or otherwise, or under any other Facility
Document, then each Borrower shall on demand from time to time pay interest, to
the extent permitted by law, on its Loans then or thereafter outstanding
(irrespective of whether or not such Loans are due) and on all other amounts
then or thereafter due from it under this Agreement, to but excluding the date
of actual payment (after as well as before judgment) of the Defaulted Amount, at
a rate (the "Default Rate") equal to (a) in the case of overdue principal of
each outstanding Loan, the rate otherwise applicable to such Loan pursuant to
Section 2.8 plus 2.0% per annum and (b) in all other cases, the Alternate Base
Rate plus 2.0% per annum.
Section 2.10. Termination and Reduction of Commitments.(a) (a) The
Revolving Credit Commitments and the L/C Commitment shall automatically expire
and terminate on the Maturity Date.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Parent may at any time in whole
permanently terminate, or from time to time in part permanently reduce, the
Revolving Credit Commitments; provided, however, that (i) each partial reduction
of the Revolving Credit Commitments shall be an integral multiple of $1,000,000
and in a minimum amount of $5,000,000 and (ii) the Total Revolving Credit
Commitment shall not be reduced to an amount that is less than the Aggregate
Credit Exposure at the time (after giving effect to any concurrent prepayment of
Loans). If the Administrative Agent receives such a notice from the Parent, the
Administrative Agent shall promptly advise the Lenders thereof.
(c) If a transaction occurs that is not permitted pursuant to
Section 8.7 or Section 8.8 or Section 8.10 other than as a Designated Sale, then
the Revolving Credit Commitments shall be reduced to the extent provided in the
definition of Designated Sales.
(d) If proceeds of the sale(s) of assets by the Parent or any of its
Subsidiaries are applied to the complete or partial retirement of the Prudential
Existing Notes or any Future Permitted Private Placement Debt (whether by
prepayment or reacquisition by the Parent or such Subsidiary or otherwise), then
(in addition to any reduction effected pursuant to paragraph (c) of this
Section) each Lender's Revolving Credit Commitment shall be reduced by the
percentage equivalent of a fraction whose numerator is the aggregate outstanding
principal amount of the Prudential Existing Notes and the Future Permitted
Private Placement Debt
19
so retired and whose denominator is the aggregate outstanding principal amount
of the Prudential Existing Notes and the Future Permitted Private Placement Debt
immediately prior to such retirement. The Parent shall give the Administrative
Agent and the Lenders seven (7) days' prior written notice of any complete or
partial retirement of the Prudential Existing Notes or the Future Permitted
Private Placement Debt out of proceeds of any such sale(s) of assets.
(e) Each reduction in the Revolving Credit Commitments hereunder
shall be made ratably among the Lenders in accordance with their respective
Revolving Credit Commitments. The Parent shall pay to the Administrative Agent
for the account of the applicable Lenders, on the date of each termination or
reduction, the Commitment Fees on the amount of the Revolving Credit Commitments
so terminated or reduced accrued to but excluding the date of such termination
or reduction.
Section 2.11. Conversion and Continuation of Borrowings.(a) (a) The Parent
(on its own behalf, in the case of a Borrowing denominated in dollars; or on
behalf of the applicable Foreign Subsidiary Borrower, in the case of a Borrowing
denominated in a Foreign Currency) or the applicable Foreign Subsidiary Borrower
(in the case of a Borrowing denominated in a Foreign Currency) shall have the
right at any time upon prior irrevocable notice to the Administrative Agent (x)
not later than 12:00 (noon), New York City time, one Business Day prior to
conversion, to convert any LIBOR Borrowing in dollars into an ABR Borrowing, (y)
not later than 11:00 a.m., New York City time (or 11:00 a.m., London time, if a
Borrowing is being continued as or converted to a Borrowing denominated in a
Foreign Currency), three Business Days prior to conversion or continuation, to
convert any ABR Borrowing of Syndicated Loans into a LIBOR Borrowing in dollars
or to continue any LIBOR Borrowing as a LIBOR Borrowing in the same currency for
an additional Interest Period or Periods, and (z) not later than 11:00 a.m., New
York City time (or 11:00 a.m., London time, if such Borrowing is denominated in
a Foreign Currency), three Business Days prior to conversion, to convert the
Interest Period with respect to any LIBOR Borrowing to another permissible
Interest Period, subject in each case to the following:
(i) each conversion or continuation shall be made pro rata
among the Lenders in accordance with the respective principal
amounts of the Loans comprising the converted or continued
Borrowing;
(ii) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, then each resulting
Borrowing shall satisfy the limitations specified in Sections 2.2(a)
and 2.2(b) regarding the principal amount and maximum number of
Borrowings of the relevant Type;
(iii) each conversion shall be effected by each Lender and the
Administrative Agent by recording for the account of such Lender the
new Loan of such Lender resulting from such conversion and reducing
the Loan (or portion thereof) of such Lender being converted by an
equivalent principal amount; accrued interest on any LIBOR Loan (or
portion thereof) being converted shall be paid by the applicable
Borrower at the time of conversion;
(iv) if any LIBOR Borrowing is converted at a time other than
the end of the Interest Period applicable thereto, the applicable
Borrower shall pay, upon demand, any amounts due the Lenders
pursuant to Section 4.4;
(v) no ABR Borrowing may be converted into a LIBOR Borrowing
during the one-month period prior to the Maturity Date; and no LIBOR
Borrowing whose Interest Period ends during the one-month period
prior to the Maturity Date may be continued as a LIBOR Borrowing for
an additional Interest Period; and
(vi) any portion of a LIBOR Borrowing that cannot be continued
as a LIBOR Borrowing by reason of the immediately preceding clause
shall at the end of the Interest Period in effect for such Borrowing
be automatically converted into an ABR Borrowing (if such LIBOR
Borrowing is denominated in dollars) or repaid by the applicable
Borrower (if such LIBOR Borrowing is denominated in a Foreign
Currency).
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Each notice pursuant to this Section shall be irrevocable and shall refer
to this Agreement and specify (i) the identity of the Borrower of the applicable
Borrowing and the amount of the Borrowing that is requested to be converted or
continued, (ii) whether such Borrowing is to be converted to or continued as a
LIBOR Borrowing or an ABR Borrowing, (iii) if such notice requests a conversion,
the date of such conversion (which shall be a Business Day), and (iv) if such
Borrowing is to be converted to or continued as a LIBOR Borrowing, the Interest
Period with respect thereto. No such notice shall be given more than seven
Business Days prior to the effective date of the applicable conversion or
continuation. If no Interest Period is specified in any such notice with respect
to any conversion to or continuation as a LIBOR Borrowing, the Borrower shall be
deemed to have selected an Interest Period of one month's duration. The
Administrative Agent shall advise the Lenders of any notice given pursuant to
this Section and of each Lender's portion of any converted or continued
Borrowing. If notice shall not have been given in accordance with this Section
to continue any LIBOR Borrowing of Syndicated Loans into a subsequent Interest
Period or (in the case of the Borrowing denominated in dollars) to convert such
Borrowing to an ABR Borrowing, such Borrowing at the end of the Interest Period
applicable thereto shall automatically be converted to an ABR Borrowing (if such
Borrowing is denominated in dollars) or shall be repaid (if such Borrowing is
denominated in a Foreign Currency).
(b) Notwithstanding any contrary provision contained in this
Agreement, upon notice to the Parent from the Administrative Agent given at the
request of the Required Lenders, after the occurrence and during the continuance
of a Default or an Event of Default, (i) no outstanding Loan denominated in
dollars may be converted into, or continued as, a LIBOR Loan, and (ii) each
LIBOR Borrowing (unless such Borrowing is paid at or before the end of the
Interest Period applicable thereto) shall at the end of the Interest Period
applicable thereto (if such Borrower is denominated in dollars) be converted to
an ABR Borrowing or (if such Borrowing is denominated in a Foreign Currency) be
continued as a LIBOR Borrowing with an Interest Period of one month's duration
in the same currency, subject to paragraph (c) of this Section.
(c) Notwithstanding anything to the contrary contained in this
Agreement, if an Event of Default described in paragraph (e) of Section 10.1
occurs (other than clause (i) thereof), or if the maturity of the Loans is
accelerated pursuant to Article 10, all Loans denominated in a Foreign Currency
shall on the date of such occurrence or acceleration be converted into, and all
amounts due thereunder shall accrue and be payable in, dollars at the current
Exchange Rate on such date, and on and after such date the interest rate
applicable thereto shall be the rate applicable to overdue ABR Loans.
(d) A Swingline Loan may not be converted into a LIBOR Loan.
Section 2.12. Optional Prepayment.(a) (a) Each Borrower shall have the
right at any time and from time to time to prepay any Borrowing, in whole or in
part, upon at least three Business Days' (in the case of LIBOR Borrowings) or
one Business Day's (in the case of ABR Borrowings of Syndicated Loans) prior
written or telecopy notice to the Administrative Agent before 11:00 a.m., New
York City time (or 11:00 a.m., London time, if such Borrowing is denominated in
a Foreign Currency), or (in the case of a Borrowing of a Swingline Loan) upon
such notice to the Administrative Agent before 11:00 a.m., New York City time,
on the day of such prepayment; provided, however, that each partial prepayment
shall be in an amount that is an integral multiple of $500,000 (in the case of a
Borrowing denominated in dollars) and not less than $1,000,000 (or the Foreign
Currency Equivalent of $1,000,000, if such Borrowing is denominated in a Foreign
Currency). Notwithstanding the immediately preceding sentence, the
Administrative Agent agrees that it will (subject to the Authorization Letter)
accept from the Parent notice by telephone of prepayment by the dates and time
specified in the immediately preceding sentence, provided that the same is
confirmed by the Parent to the Administrative Agent in writing promptly (and in
all events on the same day as such telephone communication).
(b) Each notice of prepayment shall specify the identity of the
Borrower, the prepayment date and the principal amount of each Borrowing (or
portion thereof) to be prepaid, shall be irrevocable and shall commit the
applicable Borrower to prepay such Borrowing by the amount stated therein on the
date stated therein. All prepayments under this Section 2.12 shall be subject to
Section 4.4
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but otherwise without premium or penalty. All prepayments under this Section
2.12 shall be accompanied by accrued interest on the principal amount being
prepaid to the date of payment.
Section 2.13. Mandatory Prepayments.(a) (a) In the event of any
termination of all the Revolving Credit Commitments, each Borrower shall on the
date of such termination repay or prepay all its outstanding Borrowings of
Syndicated Loans and Swingline Loans and (if any L/C Exposure exists) the Parent
shall remit to the Administrative Agent for deposit in the Cash Collateral
Account cash in an amount equal to the L/C Exposure to secure the payment when
due of the reimbursement obligation of the Parent in respect of the aggregate
undrawn face amount of Letters of Credit.
(b) In the event of any partial reduction of the Revolving Credit
Commitments, then (x) at or prior to the effective date of such reduction, the
Administrative Agent shall notify the Parent and the Lenders of the Aggregate
Credit Exposure after giving effect thereto and (y) if the Aggregate Credit
Exposure would exceed the Total Revolving Credit Commitment after giving effect
to such reduction, then on the date of such reduction one or more Borrowers
shall prepay its or their respective Borrowings in an amount sufficient to
eliminate such excess, and (if the prepayment of Borrowings is not sufficient to
eliminate such excess) the Parent shall remit to the Administrative Agent for
deposit in the Cash Collateral Account cash in the remaining amount of such
excess to secure the payment when due of the reimbursement obligation of the
Parent in respect of the aggregate undrawn face amount of Letters of Credit.
Without limiting the generality of the reductions referred to in this paragraph
of the Revolving Credit Commitments, such reductions shall include reductions
referred to in paragraphs (c) and (d) of Section 2.10 and Section 8.1(i).
(c) In addition, if on any day that is two Business Days before a
Calculation Date the Dollar Equivalent (computed using the current Exchange Rate
as of such day that is two Business Days before such Calculation Date) of the
aggregate outstanding principal balance of Foreign Currency Loans shall exceed
105% of the Foreign Currency Sublimit Dollar Amount, one or more Foreign
Subsidiary Borrowers shall within two Business Days prepay Foreign Currency
Loans in an amount sufficient so as to reduce the Dollar Equivalent of the
aggregate outstanding principal balance of Foreign Currency Loans to an amount
that is equal to or less than the Foreign Currency Sublimit Dollar Amount.
(d) All prepayments of Borrowings under this Section shall be
subject to Section 4.4, but shall otherwise be without premium or penalty.
(e) Amounts to be applied pursuant to this Section to the prepayment
by the Parent of Swingline Loans and/or Syndicated Loans shall be applied, as
applicable, first to reduce outstanding Swingline Loans, then to reduce
outstanding Syndicated Loans that are ABR Loans. Any amounts remaining after
each such application shall be applied to prepay LIBOR Loans of the Parent
immediately and/or, if elected by the Parent provided no Event of Default
exists, be deposited in the Cash Collateral Account; and any amount to be
remitted by the Parent pursuant to paragraph (a) or (b) of this Section in
respect of Letters of Credit shall be deposited in the Cash Collateral Account.
In the case of such an immediate prepayment of LIBOR Loans of the Parent, the
Parent shall (unless an Event of Default exists) be entitled to designate which
LIBOR Borrowings of the Parent are to be prepaid, by giving written notice of
such designation to the Administrative Agent at or before the remittance to the
Administrative Agent of the amounts to be applied in prepayment. Amounts to be
applied pursuant to this Section to the prepayment by a Foreign Subsidiary
Borrower of Syndicated Loans shall be applied to prepay LIBOR Loans of such
Foreign Subsidiary Borrower immediately and/or, if elected by the Parent (on
behalf of such Foreign Subsidiary Borrower) or such Foreign Subsidiary Borrower
provided no Event of Default exists, be deposited in the Cash Collateral
Account. In the case of such an immediate prepayment by a Foreign Subsidiary
Borrower of LIBOR Loans of such Foreign Subsidiary Borrower, the Parent (on
behalf of such Foreign Subsidiary Borrower) or such Foreign Subsidiary Borrower
shall (unless an Event of Default exists) be entitled to designate which LIBOR
Borrowings of such Foreign Subsidiary Borrower are to be prepaid, by giving
written notice of such designation to the Administrative Agent at or before the
remittance to the Administrative Agent of the amounts to be applied in
prepayment.
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(f) The Administrative Agent shall apply any cash deposited in the
Cash Collateral Account (i) in respect of LIBOR Loans of the Parent, to prepay
LIBOR Loans of the Parent on the last day of their respective Interest Periods
(or, at the direction of the Parent, on any earlier date) until all such
outstanding Loans have been prepaid or until all the allocable cash on deposit
with respect to such Loans has been exhausted; (ii) in respect of L/C Exposure,
to pay as and when the same becomes due the reimbursement obligation of the
Parent in respect of Letters of Credit; and (iii) in respect of LIBOR Loans of a
Foreign Subsidiary Borrower, to prepay LIBOR Loans of such Foreign Subsidiary
Borrower on the last day of their respective Interest Periods (or, at the
direction of the Parent on behalf of such Foreign Subsidiary Borrower, on any
earlier date) until all such outstanding Loans of such Foreign Subsidiary
Borrower have been prepaid or until all the allocable cash on deposit with
respect to such Loans has been exhausted. If any Letter of Credit so secured by
such cash collateral expires without being drawn (or, if drawn, whose
reimbursement is paid by the Parent with funds other than such cash collateral),
the Administrative Agent shall remit to the Parent such cash collateral securing
such Letter of Credit promptly after a request by the Parent therefor, provided
that no Default or Event of Default exists. For purposes of this Agreement, the
term "Cash Collateral Account" shall mean an account established by the Parent
(on its own behalf or on behalf of the applicable Foreign Subsidiary Borrower)
with the Administrative Agent and over which the Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal for
application in accordance with this paragraph. The Administrative Agent will, at
the request of the Parent (on its own behalf or on behalf of the applicable
Foreign Subsidiary Borrower), invest amounts on deposit in the Cash Collateral
Account in Permitted Investments; provided, however, that (i) the Administrative
Agent shall not be required to make any investment that, in its sole judgment,
would require or cause the Administrative Agent to be in, or would result in
any, violation of any law, statute, rule or regulation, and (ii) the
Administrative Agent shall have no obligation to invest amounts on deposit in
the Cash Collateral Account if a Default or Event of Default shall have occurred
and be continuing, and (iii) as to amounts on deposit for the prepayment of
LIBOR Borrowings, such Permitted Investments shall mature prior to the last day
of the applicable Interest Periods of the LIBOR Borrowings to be prepaid. The
Parent or the applicable Foreign Subsidiary Borrower (as the case may be) shall
indemnify the Administrative Agent for any losses relating to the investments so
that the amount available to prepay LIBOR Borrowings of the Parent or the
applicable Foreign Subsidiary Borrower (as the case may be) on the last day of
the applicable Interest Period, and (in the case of the Parent) to pay L/C
Exposure as and when the same becomes due, is not less than the amount that
would have been available had no investments been made pursuant hereto. Other
than any interest earned on such investments, the Cash Collateral Account shall
not bear interest. Interest or profits, if any, on such investments shall be
deposited in the Cash Collateral Account and reinvested and disbursed as
specified above. If the maturity of the Loans has been accelerated pursuant to
this Agreement, the Administrative Agent may, in its sole discretion, apply all
amounts on deposit in the Cash Collateral Account to satisfy any of the amounts
due under this Agreement or any other Facility Document, except that amounts
deposited in the Cash Collateral Account by a Foreign Subsidiary Borrower in
respect of LIBOR Loans of such Foreign Subsidiary Borrower shall not be applied
to the Loans or other amounts owing under this Agreement by the other Foreign
Subsidiary Borrower or to the Loans or other amounts owing under this Agreement
by the Parent. Each Borrower hereby grants to the Administrative Agent, for the
benefit of the Administrative Agent, the Swingline Bank, the Issuing Bank and
the Lenders, a security interest in the Cash Collateral Account to secure all
amounts due from such Borrower under this Agreement and (in the case of the
Parent) due from the Parent under the Parent Guarantee.
Section 2.14. Payments. (a) Each Borrower shall make each payment required
to be made by it hereunder and under any Facility Document (whether of
principal, interest, fees, reimbursement of LC Disbursements or otherwise) not
later than 12:00 noon, local time at the place of payment, on the date when due
in immediately available funds, without setoff, defense 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. Each such payment
(other than Issuing Bank Fees, which shall be paid directly to the Issuing Bank)
shall be made to the Administrative Agent at its offices at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx (or as otherwise instructed by the Administrative Agent, in the
case of amounts payable in a Foreign Currency) or to such other address as the
Administrative Agent may designate to the Parent in writing. Each such payment
shall be made in dollars, except that (subject to Section 2.11(c)) (i) all
principal of and interest on each
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Loan denominated in a Foreign Currency shall be made in such Foreign Currency
and (ii) any amounts payable in respect of reimbursement of expenses or
indemnification incurred in a currency other than dollars shall be paid in such
currency unless otherwise agreed by the relevant parties. The Administrative
Agent, or any Lender for whose account any such payment is to be made, may (but
shall not be obligated to) debit the amount of any such payment which is not
made by such time to any ordinary deposit account of the Parent or the
applicable Foreign Subsidiary Borrower with the Administrative Agent or such
Lender, as the case may be, and any Lender so doing shall promptly notify the
Administrative Agent; such Lender or (if the Administrative Agent effects such
debit) the Administrative Agent shall promptly after effecting such debit give
notice thereof to the Parent (on behalf of itself or the applicable Foreign
Subsidiary Borrower) as well, provided however that a failure to give such
notice to the Parent or the applicable Foreign Subsidiary Borrower shall not
affect the validity of such debit or place such Lender or the Administrative
Agent under any liability to the Parent or the applicable Foreign Subsidiary
Borrower. Each Borrower (or the Parent on behalf of the applicable Foreign
Subsidiary Borrower) shall, at the time of making each payment under this
Agreement or the Notes, specify to the Administrative Agent the principal or
other amount payable by the applicable Borrower under this Agreement or the
Notes to which such payment is to be applied (and in the event that it fails to
so specify, or if a Default or Event of Default has occurred and is continuing),
the Administrative Agent may apply such payment as it may elect in its sole
discretion (subject to Section 11.16)).
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Facility
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may, except as otherwise provided in the definition
of Interest Period, be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of interest
or Fees, if applicable.
Section 2.15. Purpose. Each Borrower shall use the proceeds of the Loans
borrowed by it for working capital and general corporate purposes. Such proceeds
shall not be used for the purpose, whether immediate, incidental or ultimate, of
buying or carrying "margin stock" within the meaning of Regulation U. The
proceeds of the initial Borrowing shall be applied to pay in full all amounts
(including principal, interest and fees) owing on the Closing Date by the Parent
under the Credit Agreement dated as of June 22, 2000 (as amended) among the
Parent, the lenders signatory thereto, The Chase Manhattan Bank, as
administrative agent and as swingline bank and as issuing bank, Fleet Bank,
N.A., as syndication agent, and The Bank of New York, as documentation agent.
Section 2.16. Increase of Total Revolving Credit Commitment. The Parent
may from time to time elect to increase the Total Revolving Credit Commitment,
on up to two occasions prior to the Maturity Date, and provided that each
increase is not less than $10,000,000 and that (after giving effect to each
increase that becomes effective) the Total Revolving Credit Commitment does not
exceed $100,000,000. The Parent may arrange for any such increase to be provided
by (a) one or more then-existing Lenders agreeing (in the sole discretion of
such Lenders) to an increase in their own respective Revolving Credit
Commitments (each Lender so agreeing to an increase in its Revolving Credit
Commitment being called herein an "Increasing Lender") and/or (b) one or more
banks, financial institutions or other entities becoming party to this Agreement
as Lenders and providing Revolving Credit Commitments (each such bank, financial
institution or other entity being called an "Augmenting Lender"), provided that
(x) each Augmenting Lender shall be subject to the approval of the Parent and
the Administrative Agent, and (y) the Borrowers and the relevant Increasing
Lenders and Augmenting Lenders shall execute and deliver all such documentation
as the Administrative Agent shall reasonably request (in form and substance
satisfactory to the Administrative Agent) to evidence (in the case of an
Increasing Lender) the increased Revolving Credit Commitment of such Increasing
Lender or (in the case of an Augmenting Lender) the status of the Augmenting
Lender as a Lender and its new Revolving Credit Commitment (which documentation,
including an amendment to this Agreement, shall not be required to be executed
by any Lender other than such Increasing Lender(s) and/or Augmenting Lender(s)
as applicable). Increases in Revolving Credit Commitments and new Revolving
Credit Commitments shall become effective on the date agreed by the Borrowers,
the Administrative Agent and (as applicable) the Increasing Lenders and
Augmenting Lenders, and the Administrative Agent shall notify the other Lenders
thereof. Notwithstanding the foregoing, no increase in the Total Revolving
Credit Commitment shall become
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effective pursuant to this Section unless (aa) on the proposed date of the
effectiveness of such increase, the conditions set forth in paragraphs (a) and
(b) of Section 5.2 are satisfied as of such date (and the Administrative Agent
shall have received a certificate to that effect dated such date executed by the
Borrowers) as if such increase were an extension of credit hereunder and (bb)
the Administrative Agent shall have received documents consistent with those
delivered on the Closing Date under paragraphs (d), (e) and (f) in Section 5.1
as to the corporate power and authority of each Borrower to borrow and otherwise
obtain extensions of credit hereunder after giving effect to such increase. Each
increase in the Total Revolving Credit Commitment that becomes effective shall
automatically effectuate an increase in the Foreign Currency Sublimit Dollar
Amount by an amount equal to two-thirds (2/3) of such increase in the Total
Revolving Credit Commitment. On the effective date of each such increase in the
Total Revolving Credit Commitment, each Borrower shall make such Borrowings and
repayments as shall, in the determination of the Administrative Agent, be
necessary to effect the reallocation of Pro Rata Percentages in outstanding
Syndicated Loans to each Borrower that is represented by the increase and/or
addition of Revolving Credit Commitments pursuant to this Section, and such
repayments shall be subject to indemnification by the applicable Borrower
pursuant to Section 4.4 if any repayment occurs on a day other than the last day
of the applicable Interest Period.
Article 3. LETTERS OF CREDIT
Section 3.1. Letters of Credit. Subject to the terms and conditions of
this Agreement, the Issuing Bank shall issue one or more standby or documentary
letters of credit (each a "Letter of Credit") denominated in dollars, for the
account of the Parent, in form acceptable to the Issuing Bank, provided that,
after giving effect to the issuance thereof:
(a) the L/C Exposure shall not exceed $15,000,000, and
(b) the Aggregate Credit Exposure shall not exceed the Total
Revolving Credit Commitment.
This Article shall not be construed to impose an obligation upon the Issuing
Bank to issue any Letter of Credit that is inconsistent with the terms and
conditions of this Agreement.
Section 3.2. Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. In order to request the issuance of a Letter of Credit (or to amend,
renew or extend an existing Letter of Credit), the Parent shall hand deliver or
telecopy to the Issuing Bank and the Administrative Agent (not later than two
Business Days in advance of the requested date of issuance, amendment, renewal
or extension) a notice requesting the issuance of a Letter of Credit (together
with, if requested by the Issuing Bank, a completed Letter of Credit application
in the Issuing Bank's then standard form), or identifying the Letter of Credit
to be amended, renewed or extended, the date of issuance, amendment, renewal or
extension, the date on which such Letter of Credit is to expire (which shall
comply with Section 3.3), the amount of such Letter of Credit, the name and
address of the beneficiary thereof and such other information as shall be
necessary to prepare such Letter of Credit. Notwithstanding the immediately
preceding sentence, the Issuing Bank and the Administrative Agent agree that
they will (subject to the Authorization Letter) accept from the Parent such
notice by telephone by the date that is two Business Days in advance as
aforesaid, provided that such notice is confirmed in writing promptly (and in
all events on the same day as such telephone communication) and that (in the
case of a requested issuance of a Letter of Credit) such confirmation is
accompanied by such completed Letter of Credit application form. 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 Parent to, or entered into by the Parent with, the
Issuing Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.
Section 3.3. Minimum Amount; Expiration Date. (a) The stated amount of
each Letter of Credit shall not be less than $1,000,000 or such lesser amount as
is acceptable to the Issuing Bank.
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(b) Each Letter of Credit shall expire by its terms not later than
the earlier of (A)(i) in the case of a documentary Letter of Credit, 180 days
after the issuance thereof (unless the Issuing Bank agrees to a more extended
expiry date) or (ii) in the case of a standby Letter of Credit, one year after
the date of issuance thereof (subject to an "evergreen" provision, if and to the
extent acceptable to the Issuing Bank); or (B) the day that is five Business
Days before the Maturity Date.
Section 3.4. Participations. By the issuance of each 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 Lenders, the Issuing
Bank hereby grants to each Lender, and each Lender hereby acquires from the
Issuing Bank, a participation in such Letter of Credit equal to such Lender's
Pro Rata Percentage of the aggregate amount available to be drawn under such
Letter of Credit, effective upon the issuance of such Letter of Credit. In
consideration and in furtherance of the foregoing, each Lender hereby absolutely
and unconditionally agrees to pay to the Administrative Agent, for the account
of the Issuing Bank, as provided in Section 3.5, such Lender's Pro Rata
Percentage of each L/C Disbursement made by the Issuing Bank and not reimbursed
by the Parent forthwith on the date due as provided in Section 3.5, or of any
reimbursement payment required to be refunded to the Parent for any reason. Each
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of a Letter of Credit, or the
occurrence and continuance of a Default or an Event of Default, or a reduction
or termination of the Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever. The Administrative Agent and the Issuing Bank shall be entitled to
offset amounts received for the account of a Lender under this Agreement or any
of the other Facility Documents against unpaid amounts due from such Lender to
the Administrative Agent or the Issuing Bank hereunder.
Section 3.5. Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Parent shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 12:00 noon, New York City time, on the date that
such LC Disbursement is made, if the Parent shall have received notice of such
LC Disbursement prior to 10:00 a.m., New York City time, on such date, or, if
such notice has not been received by the Parent 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 Parent 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 Parent receives such notice, if such notice is not
received prior to such time on the day of receipt; provided that, if such L/C
Disbursement is not less than $1,000,000, the Parent may, subject to the
conditions to borrowing set forth herein, request in accordance with Section 2.3
or 2.4 that such payment be financed with a Syndicated Borrowing of ABR Loans or
a Swingline Loan in an equivalent amount and, to the extent so financed, the
Parent's obligation to make such payment shall be deemed reimbursed, discharged
and replaced by the resulting Syndicated Borrowing of ABR Loans or such
Swingline Loan. If the Parent fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable L/C
Disbursement, the payment then due from the Parent in respect thereof and such
Lender's Pro Rata Percentage thereof. Upon its receipt of such notice, each
Lender shall pay to the Administrative Agent such Lender's Pro Rata Percentage
of the payment then due from the Parent, in immediately available funds not
later than 2:00 p.m., New York City time, on the day such Lender receives such
notice (or if such Lender shall have received such notice later than 12:00 noon,
then not later than 10:00 a.m., New York City time, on the next succeeding
Business Day). If any Lender does not pay to the Administrative Agent the amount
of such Lender's Pro Rata Percentage of the payment then due from the Parent as
required by the immediately preceding sentence, such Lender shall (independently
of and in addition to the Parent's obligation to pay interest on such amount)
pay interest on such amount, for each day from and including the date such
amount is so required to be paid by such Lender to but excluding the date such
amount is paid, to the Administrative Agent for the account of the Issuing Bank
at (i) for the first such day, the Federal Funds Effective Rate, and (ii) for
each day thereafter one percent per annum in excess of the Federal Funds
Effective Rate. The Administrative Agent shall promptly pay to the Issuing Bank
the amounts so received by it from the Lenders. Promptly following receipt by
the Administrative Agent of any payment from the Parent pursuant to this
Section, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Lenders have made payments pursuant to this
26
paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing
Bank as their interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any L/C Disbursement (other
than the funding of ABR Syndicated Loans or a Swingline Loan as contemplated
above) shall not constitute a Loan and shall not relieve the Parent of its
obligation to reimburse such L/C Disbursement. Notwithstanding anything in this
Article 3 to the contrary, the maximum amount that any Lender shall be required
to fund in respect of any LC Disbursement, whether pursuant to Section 3.4 or
this Section 3.5 or as an ABR Loan pursuant to this Section 3.5, shall not
exceed such Lender's Pro Rata Percentage of such LC Disbursement.
Section 3.6. Obligations Absolute. The Parent's obligation to reimburse
L/C Disbursements as provided in Section 3.5 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 any Facility Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of any Letter of Credit or any
Facility Document;
(iii) the existence of any claim, setoff, defense or other
right that the Parent, any other party guaranteeing, or otherwise
obligated with, the Parent, any Subsidiary or other Affiliate
thereof or any other person may at any time have against the
beneficiary under any Letter of Credit, the Issuing Bank, the
Administrative Agent or any Lender or any other Person, whether in
connection with this Agreement, any other Facility Document or any
other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in
any respect;
(v) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or other document that does not
comply with the terms of such Letter of Credit, provided that such
draft and other documents substantially comply with the terms of
such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of
the Issuing Bank, the Lenders, the Administrative Agent or any other
Person or any other event or circumstances whatsoever, whether or
not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable
discharge of the Parent's obligations hereunder.
Without limiting the generality of the foregoing, it is expressly
understood and agreed that the absolute and unconditional obligation of the
Parent hereunder to reimburse L/C Disbursements will not be excused by the gross
negligence or willful misconduct of the Issuing Bank. However, the foregoing
shall not be construed to excuse the Issuing Bank from liability to the Parent
to the extent of any direct damages (as opposed to consequential damages, claims
in respect of which are hereby waived by the Parent to the extent permitted by
applicable law) suffered by the Parent that are caused by the Issuing Bank's
gross negligence or willful misconduct in determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof; it
is understood that the Issuing Bank may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary and, in making any
payment under any Letter of Credit (i) the Issuing Bank's exclusive reliance on
the documents presented to it under such Letter of Credit as to any and all
matters set forth therein, including reliance on the amount of any draft
presented under such Letter of Credit, whether or not the amount due to the
beneficiary thereunder equals the amount of such draft and whether or not any
document presented pursuant to such Letter of
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Credit proves to be insufficient in any respect, if such document on its face
appears to be in order, and whether or not any other statement or any other
document presented pursuant to such Letter of Credit proves to be forged or
invalid or any statement therein proves to be inaccurate or untrue in any
respect whatsoever and (ii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in
each case, be deemed not to constitute willful misconduct or gross negligence of
the Issuing Bank.
Section 3.7. 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 as promptly
as possible give telephonic notification, confirmed by telecopy, to the
Administrative Agent and the Parent 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 Parent
of its obligation to reimburse the Issuing Bank and the Lenders with respect to
any such L/C Disbursement. The Administrative Agent shall promptly give each
Lender notice thereof.
Section 3.8. Interim Interest. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, then, unless the Parent shall
reimburse such L/C Disbursement in full on the date on which such L/C
Disbursement is made, the unpaid amount thereof shall bear interest, for each
day from and including the date of such L/C Disbursement to but excluding the
date that the Parent reimburses such L/C Disbursement, at the rate per annum
that would apply to such amount if such amount were an ABR Loan. Interest
accrued pursuant to this Section shall be for the account of the Issuing Bank,
except that interest accrued on and after the date of payment by any Lender
pursuant to Section 3.4 or 3.5 to reimburse the Issuing Bank shall be for the
account of such Lender to the extent of such payment.
Section 3.9. Letter of Credit Fees. The Parent agrees to pay (i) to each
Lender, through the Administrative Agent, on the last day of March, June,
September and December of each year and on the date on which the Revolving
Credit Commitment of such Lender shall be terminated as provided herein, a fee
(an "L/C Participation Fee") calculated on such Lender's Pro Rata Percentage of
the average daily aggregate L/C Exposure (excluding the portion thereof
attributable to unreimbursed L/C Disbursements) during the preceding quarter (or
shorter period commencing with the date hereof, or ending with the Maturity Date
or the date on which all Letters of Credit have been canceled or have expired
and the Revolving Credit Commitments of all Lenders have been terminated) at a
rate equal to (in the case of standby Letters of Credit) the same Applicable
Rate used to determine the interest rate applicable to LIBOR Loans and (in the
case of documentary Letters of Credit) .20% per annum, and (ii) to the Issuing
Bank with respect to each Letter of Credit, a facing fee at a rate equal to
..0625% per annum in respect of each Letter of Credit (payable at the same times
that the L/C Participation Fee is payable) plus the standard issuance and
drawing fees specified from time to time by the Issuing Bank (the "Issuing Bank
Fees"). All L/C Participation Fees and Issuing Bank Fees shall be computed on
the basis of the actual number of days elapsed in a year of 360 days. The L/C
Participation Fee and the Issuing Bank Fees shall be paid on the dates due in
immediately available funds, (in the case of the L/C Participation Fee) to the
Administrative Agent for distribution as appropriate among the Lenders and (in
the case of the Issuing Bank Fees) directly to the Issuing Bank.
Section 3.10. Resignation of the Issuing Bank. The Issuing Bank may resign
at any time by giving 180 days' prior written notice to the Administrative
Agent, the Lenders and the Parent. The Parent shall have the right to appoint
any Lender as successor Issuing Bank, subject to the consent of the Required
Lenders including the appointed Lender (which consent of the appointed Lender
shall be in such Lender's sole discretion, and which consent of the other
Required Lenders shall not be unreasonably withheld). Upon the acceptance of any
appointment as the Issuing Bank hereunder by a Lender that shall agree to serve
as successor Issuing Bank, such successor shall succeed to and become vested
with all the interests, rights and obligations of the retiring Issuing Bank
(except to the extent provided for in the last sentence of this Section) and the
retiring Issuing Bank shall be discharged from its obligations to issue
additional Letters of Credit hereunder. At the time such resignation shall
become effective, the Parent shall pay all accrued and unpaid Issuing Bank Fees.
The acceptance of any appointment as the Issuing Bank hereunder by a successor
Lender shall be evidenced by an agreement
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entered into by such successor, in a form satisfactory to the Parent and the
Administrative Agent, and from and after the effective date of such agreement
(i) such successor Lender shall have all the rights and obligations of the
previous Issuing Bank under this Agreement and the other Loan Documents and (ii)
references herein and in the other Loan Documents to the term "Issuing Bank"
shall be deemed to refer to such successor or to any previous Issuing Bank, or
to such successor and all previous Issuing Banks, as the context shall require.
After the resignation of the Issuing Bank hereunder, the retiring Issuing Bank
shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement and the other Facility
Documents with respect to Letters of Credit issued by it prior to such
resignation, but shall not be required to issue additional Letters of Credit.
Section 3.11. Not Fiduciary. In no event shall the Issuing Bank be deemed
a fiduciary of the Lenders with respect to Letters of Credit. As between the
Issuing Bank (on the one hand) and the Lenders (on the other hand), the Issuing
Bank shall have in connection with the Letters of Credit all the rights and
protections that are afforded to the Administrative Agent in Article 11.
Section 3.12. Purpose. No Letter of Credit shall be used by the Parent for
the purpose, whether immediate, incidental or ultimate, of buying or carrying
"margin stock" within the meaning of Regulation U.
Article 4. YIELD PROTECTION; ILLEGALITY; ETC.
Section 4.1. Alternate Rate of Interest. If prior to the commencement of
any Interest Period for a LIBOR Borrowing denominated in any currency:
(a) the Administrative Agent determines (which determination, if
made on a reasonable and nondiscriminatory basis, shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for ascertaining
the Adjusted LIBO Rate for such Borrowing for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBO Rate for such Interest Period will not adequately and fairly
reflect the cost to such Lenders of making or maintaining their Loans included
in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Parent (on behalf
of itself and the Foreign Subsidiary Borrowers, if applicable) and the Lenders
by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies the Parent (on behalf of itself and the Foreign
Subsidiary Borrowers, if applicable) and the Lenders that the circumstances
giving rise to such notice no longer exist, (i) any request to convert any
Borrowing to, or to continue any Borrowing as, a LIBOR Borrowing in such
currency shall be ineffective, and any LIBOR Borrowing denominated in such
currency shall be repaid on the last day of the then current Interest Period
with respect thereto or (at the option of the Parent, in the case of a LIBOR
Borrowing denominated in dollars) shall be converted to an ABR Borrowing in
accordance with this Agreement on the last day of the then current Interest
Period with respect thereto, (ii) if any Syndicated Loan Borrowing Request
requests a LIBOR Borrowing denominated in such currency, (x) if such currency is
dollars, such Borrowing shall be made as an ABR Borrowing, and (y) if such
currency is not dollars, such Borrowing Request shall be ineffective.
Section 4.2. Reserve Requirement; Change in Circumstances. (a)
Notwithstanding any other provision of this Agreement, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender or the
Swingline Bank or the Issuing Bank of the principal of or interest on any LIBOR
Loan made by such Lender or any Fees or other amounts payable hereunder (other
than changes in respect of taxes imposed on the overall net income of such
Lender or the Swingline Bank or the Issuing Bank by the jurisdiction in which
such Lender or the Swingline Bank or the
29
Issuing Bank has its principal office or by any political subdivision or taxing
authority therein), or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by any Lender or the Swingline Bank or the
Issuing Bank (except only such reserve requirement which is reflected in the
Adjusted LIBOR Rate) or shall impose on such Lender or the Swingline Bank or the
Issuing Bank or the London interbank market (or other relevant interbank market)
any other condition affecting this Agreement or LIBOR 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 or the Swingline Bank or
the Issuing Bank of making or maintaining any LIBOR Loan or of issuing or
maintaining any Letter of Credit or purchasing or maintaining a participation
therein or to reduce the amount of any sum received or receivable by such Lender
or the Swingline Bank or the Issuing Bank hereunder in respect thereof (whether
of principal, interest or otherwise) by an amount deemed by such Lender or the
Swingline Bank or the Issuing Bank to be material, then the Parent or the
applicable Foreign Subsidiary Borrower shall pay to such Lender or the Swingline
Bank or the Issuing Bank, as the case may be, upon demand such additional amount
or amounts as will compensate such Lender or the Swingline Bank or the Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered. There shall be no duplication of payments in respect of Indemnified
Taxes and Other Taxes required to be made by this Section and by Section 4.5.
(b) If any Lender or the Swingline Bank or the Issuing Bank shall
have determined that the adoption after the date hereof of any law, rule,
regulation, agreement or guideline regarding capital adequacy or any change
after the date hereof in any law, rule, regulation, agreement or guideline
regarding capital adequacy (whether or not such law, rule, regulation, agreement
or guideline has been adopted) or in the interpretation or administration
thereof by any Governmental Authority charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or the Swingline Bank or the Issuing Bank or any Lender's or the
Swingline Bank's or the Issuing Bank's holding company with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any Governmental Authority has or would have the effect of reducing the rate of
return on such Lender's or the Swingline Bank's or the Issuing Bank's capital or
on the capital of such Lender's or the Swingline Bank's or the Issuing Bank's
holding company, if any, as a consequence of this Agreement or the Loans made or
participation in Letters of Credit purchased by such Lender or by the Swingline
Bank pursuant hereto or the Letters of Credit issued by the Issuing Bank
pursuant hereto to a level below that which such Lender or the Swingline Bank or
the Issuing Bank or such Lender's or the Swingline Bank's or the Issuing Bank's
holding company could have achieved but for such applicability, adoption, change
or compliance (taking into consideration such Lender's or the Swingline Bank's
or the Issuing Bank's policies and the policies of such Lender's or the
Swingline Bank's or the Issuing Bank's holding company with respect to capital
adequacy) by an amount deemed by such Lender or the Swingline Bank or the
Issuing Bank to be material, then from time to time the Parent or the applicable
Foreign Subsidiary Borrower shall pay to such Lender or the Swingline Bank or
the Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Swingline Bank or the Issuing Bank or such
Lender's or the Swingline Bank's or the Issuing Bank's holding company for any
such reduction suffered.
(c) A certificate of a Lender or the Swingline Bank or the Issuing
Bank setting forth the amount or amounts necessary to compensate such Lender or
the Swingline Bank or the Issuing Bank or its holding company, as applicable, as
specified in paragraph (a) or (b) above shall be delivered to the Parent and
shall (if the determination of such amount or amounts is made on a reasonable
and nondiscriminatory basis) be conclusive absent manifest error. The Parent or
the applicable Foreign Subsidiary Borrower shall pay such Lender or the
Swingline Bank or the Issuing Bank the amount shown as due on any such
certificate delivered by it within 10 days after receipt by the Parent of the
same.
(d) Failure or delay on the part of any Lender or the Swingline Bank
or the Issuing Bank to demand compensation for any increased costs or reduction
in amounts received or receivable or reduction in return on capital shall not
constitute a waiver of such Lender's or the Swingline Bank or the Issuing Bank's
right to demand such compensation; provided however that if any Lender or the
Swingline Bank or the Issuing Bank demands such compensation in respect of a
period prior to the date on which written demand therefor is given to the
Parent, then the obligation of the Parent or the applicable Foreign
30
Subsidiary Borrower to pay such compensation in respect of such period shall be
limited to the three months prior to the giving of such written demand, plus (if
such demand results from a retroactive change in the aforesaid law, regulation,
interpretation, administration, or guideline) the period of such retroactivity;
however, such limitation shall not apply in respect of the period from and after
the giving of such written demand. The protection of this Section shall be
available to each Lender and the Swingline Bank or the Issuing Bank regardless
of any possible contention of the invalidity or inapplicability of the law,
rule, regulation, agreement, guideline or other change or condition that shall
have occurred or been imposed.
Section 4.3. Change in Legality. (a) Notwithstanding any other provision
of this Agreement, if, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any LIBOR Loan denominated in a particular
currency or to give effect to its obligations as contemplated hereby with
respect to any LIBOR Loan denominated in a particular currency, then, by written
notice to the Parent (on behalf of itself or a Foreign Subsidiary Borrower, as
applicable) and to the Administrative Agent:
(x) such Lender may declare that LIBOR Loans in such currency
will not thereafter (for the duration of such unlawfulness) be made by
such Lender hereunder (or be continued for additional Interest Periods)
and that Loans of any other Type will not thereafter (for such duration)
be converted into LIBOR Loans denominated in such currency; whereupon (if
such currency is dollars) any request for a LIBOR Borrowing in dollars (or
to convert an ABR Borrowing into a LIBOR Borrowing in dollars or to
continue a LIBOR Borrowing in dollars for an additional Interest Period)
shall as to such Lender only be deemed a request for an ABR Loan unless
such declaration is subsequently withdrawn; and
(y) such Lender may require that all outstanding LIBOR Loans
made by it in such currency be converted to ABR Loans (if such currency is
dollars) or be repaid by the applicable Foreign Subsidiary Borrower (if
such currency is a Foreign Currency), in which event all such LIBOR Loans
shall be so converted or repaid (as applicable) as of the effective date
of such notice as provided in paragraph (b) below.
In the case of any conversion pursuant to the exercise by any Lender of its
rights under clause (x) or (y) above, all payments and prepayments of principal
that would otherwise have been applied to repay the LIBOR Loans in dollars that
would have been made by such Lender or the converted LIBOR Loans in dollars of
such Lender shall instead be applied to repay the ABR Loans made by such Lender
in lieu of, or resulting from the conversion of, such LIBOR Loans in dollars.
(b) For purposes of this Section, a notice to the Parent by any
Lender shall be effective as to each LIBOR Loan made by such Lender, if lawful,
on the last day of the Interest Period then applicable to such LIBOR Loan; in
all other cases such notice shall be effective on the date of receipt by the
Parent.
Section 4.4. Indemnity. As to the Loans of such Borrower, each Borrower
shall indemnify each Lender against any loss or expense that such Lender may
sustain or incur as a consequence of (a) any event, other than a default by such
Lender in the performance of its obligations hereunder, which results in (i)
such Lender receiving or being deemed to receive any amount on account of the
principal of any LIBOR Loan prior to the end of the Interest Period in effect
therefor, (ii) the conversion of any LIBOR Loan to an ABR Loan, or the
conversion of the Interest Period with respect to any LIBOR Loan, in each case
other than on the last day of the Interest Period in effect therefor, or (iii)
any LIBOR Loan to be made by such Lender (including any LIBOR Loan to be made
pursuant to a conversion or continuation under Section 2.11) not being made
after notice of such Loan shall have been given by the Parent or applicable
Foreign Subsidiary Borrower hereunder (any of the events referred to in this
clause (a) being called a "Breakage Event") or (b) any default in the making of
payment or prepayment required to be made hereunder. In the case of any Breakage
Event, such loss shall include an amount equal to the excess, as reasonably
determined by such Lender, of (i) its cost of obtaining funds for the LIBOR Loan
that is the subject of such Breakage Event for the period from the date of such
Breakage Event to the last day of the
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Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Parent (on behalf of itself or the applicable Foreign Subsidiary
Borrower) and shall (if the determination of such amount or amounts is made on a
reasonable and nondiscriminatory basis) be conclusive absent manifest error.
Section 4.5. Taxes. (a) Any and all payments by or on account of any
obligation of any Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that, if any
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 (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, each
Lender, the Swingline Bank or the 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 applicable Borrower shall make such deductions, and (iii) the
applicable Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, each Borrower shall pay any Other Taxes payable by
it to the relevant Governmental Authority in accordance with applicable law.
(c) Each Borrower shall indemnify the Administrative Agent, each
Lender, the Swingline Bank 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, the Swingline Bank or the Issuing
Bank, as the case may be, on or with respect to any payment by or on account of
any obligation of such 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 Other Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability delivered
to the Parent (on behalf of itself or the applicable Foreign Subsidiary
Borrower) by a Lender or the Swingline Bank or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the Swingline
Bank or the Issuing Bank, shall (if there is a reasonable basis for such payment
or liability, and if the determination of the amount thereof is made on a
reasonable basis) be conclusive absent manifest error.
(d) After payment by a Borrower to the demanding party of the amount
demanded pursuant to paragraph (c) of this Section, such Borrower shall be
entitled to commence a legal proceeding against the applicable Governmental
Authority to recover the Indemnified Taxes or Other Taxes so paid by the
demanding party; and (after such payment by such Borrower to the demanding
party) the demanding party shall at the sole expense of such Borrower cooperate
with such Borrower as such Borrower may reasonably request with respect to such
legal proceeding, provided that the demanding party may do so without material
risk of liability.
(e) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by a Borrower to a Governmental Authority, such Borrower shall
deliver to the Administrative Agent written evidence thereof reasonably
satisfactory to the Administrative Agent.
(f) If a Borrower and a Lender (or, in the case of a payment to the
Administrative Agent, the Administrative Agent) (each, a "Payee") agree that an
Indemnified Tax paid by such Borrower under Section 4.5 (a) or (c) with respect
to payments by such Borrower to such Payee should more likely than not be
refunded by the relevant Governmental Authority under applicable law, such Payee
shall, at the expense of such Borrower, cooperate with such Borrower as such
Borrower may reasonably request in order to seek a refund of such Indemnified
Tax, including the execution by the Payee of such documents acceptable to the
Payee as such Borrower may reasonably request, provided that the Payee may do so
without material risk of liability, and provided further that no Payee shall be
required to disclose its tax returns or other information it deems confidential.
If any Payee receives a refund of any Indemnified Tax paid by a Borrower under
Section 4.5 (a) or (c) (including a refund received pursuant to
32
the preceding sentence) the amount of such refund received (together with any
interest received from the Governmental Authority thereon) shall be paid to such
Borrower.
Section 4.6. Duty to Mitigate. If (i) any Lender or the Swingline Bank or
the Issuing Bank shall request compensation under Section 4.2, (ii) any Lender
or the Swingline Bank or the Issuing Bank delivers a notice described in Section
4.3 or (iii) a Borrower is required to pay any additional amount to any Lender
or the Swingline Bank or the Issuing Bank or any Governmental Authority on
account of any Lender or the Swingline Bank or the Issuing Bank, pursuant to
Section 4.5, then such Lender or the Swingline Bank or the Issuing Bank shall
use reasonable efforts (which shall not require such Lender or the Swingline
Bank or the Issuing Bank to incur an unreimbursed loss or unreimbursed cost or
expense or otherwise take any action inconsistent with its internal policies or
legal or regulatory restrictions or suffer any disadvantage or burden deemed by
it to be significant) (x) to file any certificate or document reasonably
requested in writing by the Parent or (y) to assign its rights and delegate and
transfer its obligations hereunder to another of its offices, branches or
affiliates, if such filing or assignment would reduce its claims for
compensation under Section 4.2 or enable it to withdraw its notice pursuant to
Section 4.3 or would reduce amounts payable pursuant to Section 4.5, as the case
may be, in the future. The Parent hereby agrees to pay all reasonable costs and
expenses incurred by any Lender or the Swingline Bank or the Issuing Bank in
connection with any such filing or assignment, delegation and transfer.
Section 4.7. Replacement of Lenders. If any Lender or the Swingline Bank
or the Issuing Bank requests compensation under Section 4.2, or if any Lender or
the Swingline Bank or the Issuing Bank delivers a notice described in Section
4.3, or if a Borrower is required to pay any additional amount to any Lender,
the Swingline Bank, the Issuing Bank or any Governmental Authority for the
account of any Lender or the Swingline Bank or the Issuing Bank pursuant to
Section 4.5, or if any Lender defaults in its obligation to fund Loans
hereunder, then the Parent may, at its sole expense and effort, upon notice to
such Lender or the Swingline Bank or the Issuing Bank, as the case may be, and
the Administrative Agent, require such Lender or the Swingline Bank or the
Issuing Bank, as the case may be, to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 12.5, which
restrictions shall apply, for purposes of this Section, with reference to the
Swingline Bank and the Issuing Bank, as well as with reference to a Lender) all
its interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that (i) if the assignee is not a Lender, the
Parent shall have received the prior written consent of the Administrative Agent
(and the Swingline Bank and the Issuing Bank), which consent shall not be
unreasonably withheld; and (ii) such Lender or the Swingline Bank or the Issuing
Bank shall have received payment of an amount equal to the outstanding principal
of its Loans and unreimbursed L/C Disbursements and funded participations in
Swingline Loans, accrued interest thereon and accrued fees and other amounts
(including amounts under Sections 4.2, 4.3, 4.4 and 4.5) payable to it hereunder
from the assignee or the applicable Borrower, and (if the Issuing Bank is to be
the assignor) the Issuing Bank shall have received from the Parent cash
collateral or other collateral satisfactory to it, having a value not less than
the aggregate undrawn face amount of all Letters of Credit that are outstanding,
as security for the reimbursement obligation of the Parent in respect of such
Letters of Credit; and (iii) in the case of any such assignment resulting from a
claim for compensation under Section 4.2 or payments required to be made
pursuant to Section 4.3 or 4.5, such assignment will result in a reduction in
such compensation or payments. A Lender, the Swingline Bank or the Issuing Bank
(as the case may be) shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender, the
Swingline Bank or the Issuing Bank (as the case may be) or otherwise, the
circumstances entitling the Parent to require such assignment and delegation
cease to apply. The interests, rights and obligations hereunder of a Lender that
serves as either or both of the Issuing Bank or the Swingline Bank hereunder
shall include its interests, rights and obligations in all such capacities.
Section 4.8. Certain Additional Costs. (a) If and so long as any Lender
is required to comply with reserve assets, liquidity, cash margin or other
requirements of any monetary or other authority (including any such requirement
imposed by the European Central Bank or the European System of Central Banks,
but excluding requirements reflected in the Statutory Reserve Rate) in respect
of any of
33
such Lender's Foreign Currency Loans, such Lender may require the Borrower to
which such Lender has made a Foreign Currency Loan to pay, contemporaneously
with each payment of interest on each of such Lender's Foreign Currency Loans
subject to such requirements, additional interest on such Foreign Currency Loan
at a rate per annum specified by such Lender to be the cost to such Lender of
complying with requirements in relation to such Foreign Currency Loan. Any
additional interest owed pursuant to this paragraph shall be determined by the
relevant Lender, which determination (if made on a reasonable and
nondiscriminatory basis) shall be conclusive absent manifest error, and notified
to the Parent (on behalf of the applicable Foreign Subsidiary Borrower) (with a
copy to the Administrative Agent) at least five Business Days before each date
on which interest is payable for the relevant Foreign Currency Loan, and such
additional interest so notified by such Lender shall be payable to the
Administrative Agent for the account of such Lender on each date on which
interest is payable for such Foreign Currency Loan.
(b) If the cost to any Lender of making or maintaining any Loan to
either Foreign Subsidiary Borrower is increased (or the amount of any sum
received or receivable by any Lender (or its applicable lending office) is
reduced) by an amount deemed in good faith by such Lender to be material, by
reason of the fact that the applicable Foreign Subsidiary Borrower is
incorporated in, or conducts business in, a jurisdiction outside the United
States, such Foreign Subsidiary Borrower shall indemnify such Lender for such
increased cost or reduction. A certificate of a Lender setting forth the amount
or amounts necessary to indemnify such Lender as specified in this paragraph
shall be delivered to the Parent (on behalf of the applicable Foreign Subsidiary
Borrower) and shall (if made on a reasonable and nondiscriminatory basis) be
conclusive absent manifest error. The applicable Foreign Subsidiary Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof by the Parent.
Article 5. CONDITIONS PRECEDENT.
Section 5.1. Documentary Conditions Precedent. The execution and delivery
of this Agreement by the Lenders, the Administrative Agent, the Swingline Bank
and the Issuing Bank are subject to the condition precedent that the
Administrative Agent shall have received on or before the Closing Date each of
the following, in form and substance satisfactory to the Administrative Agent
and its counsel:
(a) the Syndicated Loan Notes of the Parent and the Swingline Loan
Note, duly executed by the Parent; and the Syndicated Loan Notes of Concord,
duly executed by Concord; and the Syndicated Loan Notes of MWC, duly executed by
MWC;
(b) the Authorization Letter, duly executed by the Borrowers;
(c) the Parent Guarantee, duly executed by the Parent; and the
Initial Subsidiary Guarantees, duly executed by the Initial Subsidiary
Guarantors (respectively);
(d) a certificate of the Secretary or Assistant Secretary of the
Parent, dated the Closing Date, attesting (i) to all corporate action taken by
the Parent, including resolutions of its Board of Directors, authorizing the
execution, delivery and performance of the Facility Documents to which it is a
party and each other document to be delivered pursuant to this Agreement; (ii)
to a true and complete copy of its certificate of incorporation and by-laws; and
(iii) to the names and true signatures of officers of the Parent authorized to
sign the Facility Documents to which it is a party and the other documents to be
delivered by the Parent under this Agreement;
(e) a certificate of the Secretary (or equivalent officer) of
Concord, dated the Closing Date, attesting (i) to all corporate action taken by
Concord, including resolutions of its Board of Directors, authorizing the
execution, delivery and performance of the Facility Documents to which it is a
party and each other document to be delivered pursuant to this Agreement; (ii)
to a true and complete copy of its certificate of incorporation and by-laws (or
equivalent charter documents); and (iii) to the names and true
34
signatures of officers of Concord authorized to sign the Facility Documents to
which it is a party and the other documents to be delivered by Concord under
this Agreement;
(f) a certificate of the Secretary (or equivalent officer) of MWC,
dated the Closing Date, attesting (i) to all corporate action taken by MWC,
including resolutions of its Board of Directors, authorizing the execution,
delivery and performance of the Facility Documents to which it is a party and
each other document to be delivered pursuant to this Agreement; (ii) to a true
and complete copy of its certificate of incorporation and by-laws; and (iii) to
the names and true signatures of officers of MWC authorized to sign the Facility
Documents to which it is a party and the other documents to be delivered by MWC
under this Agreement;
(g) a certificate of the Secretary or Assistant Secretary of each
Initial Subsidiary Guarantor dated the Closing Date, attesting (i) to all
corporate action taken by such Initial Subsidiary Guarantor, including
resolutions of its Board of Directors and consents of its members, authorizing
the execution, delivery and performance of its Initial Subsidiary Guarantee;
(ii) to a true and complete copy of its certificate of incorporation and by-laws
or certificate of formation and operating agreement (as applicable); and (iii)
to the names and true signatures of the officers of such Initial Subsidiary
Guarantor authorized to sign its Initial Subsidiary Guarantee;
(h) a certificate of each of the Parent, Concord and MWC, dated the
Closing Date, stating that the representations and warranties in Article 6 are
true and correct on such date as though made on and as of such date and that no
event has occurred and is continuing which constitutes a Default or an Event of
Default;
(i) favorable opinions of domestic counsel for the Parent, the
Foreign Subsidiary Borrowers and the Initial Subsidiary Guarantors (Xxxxxxx X.
Xxxxxx, Esq. and Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP), dated the
Closing Date, in substantially the forms of Exhibit C-1 and Exhibit C-2
(respectively) and as to such other matters as the Administrative Agent, any
Lender, the Swingline Bank or the Issuing Bank may reasonably request;
(j) a favorable opinion of Swiss counsel for the Foreign Subsidiary
Borrowers, dated the Closing Date, in substantially the form of Exhibit C-3 and
as to such other matters as the Administrative Agent or any Lender may
reasonably request;
(k) evidence that the Parent has paid in full (i) all amounts owing
under the Credit Agreement referred to in Section 2.15; (ii) all Fees that are
required to be paid on the Closing Date, and all other fees that are required
(pursuant to the Fee Letter) to be paid to the Lenders on the Closing Date; and
(iii) the reasonable fee and disbursements of counsel for the Administrative
Agent in connection with the closing of the transaction contemplated by this
Agreement; and
(l) such other approvals, opinions, certificates and documents as
the Administrative Agent may reasonably request.
Section 5.2. Additional Conditions Precedent. The obligations of the
Lenders to make any Syndicated Loans pursuant to a Borrowing which increases the
amount of Syndicated Loans outstanding hereunder (including the initial
Borrowing), and of the Swingline Bank to make any Swingline Loan (including the
initial Borrowing), and of the Issuing Bank to issue, amend, renew or extend any
Letter of Credit hereunder, shall be subject to the further conditions precedent
that on the date of such Syndicated Loans or such Swingline Loan or such
issuance, amendment, renewal or extension of such Letter of Credit (as the case
may be), the following statements shall be true:
(a) the representations and warranties contained in Article 6 are
true and correct on and as of the date such Syndicated Loans are made or such
Swingline Loan is made or such Letter of Credit is issued, amended, renewed or
extended (as the case may be) as though made on and as of such date, except (i)
for any change since the date hereof with respect to Section 6.9 or Section 6.10
provided
35
that (x) the Parent shall have given specific notice of such change to the
Lenders and the Administrative Agent in writing and (y) such change does not
constitute a Default or Event of Default; and (ii) that any representation and
warranty contained in Section 6.5 that specifically relates to January 31, 2003
(other than the last sentence of Section 6.5) shall be true and correct as of
January 31, 2003; and
(b) no Default or Event of Default has occurred and is continuing,
or would result from such Syndicated Loans or such Swingline Loans or the
issuance, amendment, renewal or extension of such Letter of Credit.
Section 5.3. Deemed Representations. Each Borrowing Request and each
acceptance by the applicable Borrower of the proceeds of such Borrowing, and
each request by the Parent for the issuance, amendment, renewal or extension of
a Letter of Credit and each issuance, amendment, renewal or extension of a
Letter of Credit, shall constitute a representation and warranty by the
Borrowers that the statements contained in Section 5.2 are true and correct both
on the date of such Borrowing Request or request with respect to a Letter of
Credit and, unless the Parent otherwise notifies the Administrative Agent prior
to such Borrowing or such issuance, amendment, renewal or extension, as of the
date of such Borrowing or such issuance, amendment, renewal or extension.
Article 6. REPRESENTATIONS AND WARRANTIES.
Each of the Borrowers hereby represents and warrants as follows (provided
however that such representations and warranties by each Foreign Subsidiary
Borrower shall be as to such Foreign Subsidiary Borrower only):
Section 6.1. Incorporation, Good Standing and Due Qualification. Each of
the Parent and its Subsidiaries is duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its assets and to transact the business in
which it is now engaged, and is duly qualified as a foreign corporation and in
good standing under the laws of each other jurisdiction in which the failure to
be so qualified would have a material adverse effect on the business, financial
condition or operations of the Parent and its Subsidiaries taken as a whole.
Section 6.2. Corporate Power and Authority; No Conflicts. The execution,
delivery and performance by each of the Borrowers and each Guarantor of the
Facility Documents to which it is a party are within its corporate power and
authority and have been duly authorized by all necessary corporate action and do
not and will not: (a) require any consent or approval of its stockholders or
members; (b) contravene any of its organizational documents; (c) violate any
provision of, or require any filing, registration, consent or approval under,
any law, rule, regulation (including, without limitation, Regulation U), order,
writ, judgment, injunction, decree, determination or award presently in effect
having applicability to the Parent or any Subsidiaries or Affiliates of the
Parent; (d) result in a breach of or constitute a default or require any consent
under any indenture or loan or credit agreement or any other agreement, lease or
instrument to which any Borrower or Guarantor is a party or by which it or its
properties may be bound or affected; (e) result in, or require, the creation or
imposition of any Lien upon or with respect to any of the properties now owned
or hereafter acquired by any Borrower or Guarantor; or (f) cause the Parent (or
any Subsidiary or Affiliate of the Parent, as the case may be) to be in default
under any such law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or any such indenture, agreement, lease or instrument.
Section 6.3. Legally Enforceable Agreements. Each Facility Document to
which any Borrower or Guarantor is a party is a legal, valid and binding
obligation of such Borrower or Guarantor (as the case may be) enforceable
against such Borrower or Guarantor (as the case may be) in accordance with its
terms, except to the extent that such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in equity or at law).
36
Section 6.4. Litigation. There are no actions, suits or proceedings
pending or, to the knowledge of any Borrower, threatened, against or affecting
the Parent or any of its Subsidiaries before any court, governmental agency or
arbitrator, as to which there is a reasonable possibility of determination
adverse to the Parent or such Subsidiary and which (if determined adversely to
the Parent or such Subsidiary) would, in any one case or in the aggregate,
materially adversely affect the financial condition, operations or business of
the Parent and its Subsidiaries taken as a whole or the ability of any Borrower
or Guarantor to perform its obligations under the Facility Documents to which it
is a party.
Section 6.5. Financial Statements. The consolidated and consolidating
balance sheet of the Parent and its Consolidated Subsidiaries as at January 31,
2003, and the related consolidated and consolidating income statement and
statements of cash flows and changes in stockholders' equity of the Parent and
its Consolidated Subsidiaries for the fiscal year then ended, and the
accompanying footnotes, together with the accompanying opinion of
PricewaterhouseCoopers LLP, independent certified public accountants, copies of
which have been furnished to each of the Lenders, are complete and correct in
all material respects and fairly present the financial condition of the Parent
and its Consolidated Subsidiaries as at such date and the results of the
operations of the Parent and its Consolidated Subsidiaries for the period
covered by such statements, all in accordance with GAAP consistently applied.
There are no liabilities of the Parent or any of its Consolidated Subsidiaries,
fixed or contingent, which are material in relation to the consolidated
financial condition of the Parent but are not reflected in the financial
statements or in the notes thereto, other than liabilities arising in the
ordinary course of business since January 31, 2003. No information, exhibit or
report furnished by any Borrower to the Administrative Agent or any of the
Lenders in connection with the negotiation of this Agreement, when read together
with the financial statements referred to in this Section 6.5, contained any
material misstatement of fact or omitted to state a material fact or any fact
necessary to make the statements contained therein not materially misleading.
Since January 31, 2003, there has been no material adverse change in the
condition (financial or otherwise), business or operations of the Parent and the
Consolidated Subsidiaries taken as a whole.
Section 6.6. Ownership and Liens. Each of the Parent and its Consolidated
Subsidiaries has title to, or valid leasehold interests in, all of its
properties and assets, real and personal, including the properties and assets,
and leasehold interests reflected in the financial statements referred to in
Section 6.5 (other than any properties or assets disposed of in the ordinary
course of business, and other than properties and assets that are not material
to the Parent and its Subsidiaries taken as a whole and other than any other
sales that are permitted by this Agreement), and none of the properties and
assets owned by the Parent or any of its Subsidiaries and none of its leasehold
interests is subject to any Lien, except as disclosed in such financial
statements or as may be permitted hereunder.
Section 6.7. Taxes. Each of the Parent and its Subsidiaries has filed all
tax returns (foreign, federal, state and local) required to be filed and has
paid all taxes, assessments and governmental charges and levies shown thereon to
be due, including interest and penalties, except for such taxes and other
amounts as are being contested in good faith by appropriate proceedings for
which adequate reserves have been established in accordance with GAAP.
Section 6.8. ERISA.(a) (a) No accumulated funding deficiency (as defined
in Section 302 of ERISA and Section 412 of the Code), whether or not waived,
exists with respect to any Plan (other than a Multiemployer Plan). No liability
to the PBGC has been or is expected by the Parent or any ERISA Affiliate to be
incurred with respect to any Plan (other than a Multiemployer Plan) by the
Parent, any Subsidiary or any ERISA Affiliate which is or would be materially
adverse to the business, financial condition or operations of the Parent and its
Subsidiaries taken as a whole. Neither the Parent, nor any Subsidiary nor any
ERISA Affiliate has incurred or presently expects to incur any withdrawal
liability under Title IV of ERISA with respect to any Multiemployer Plan which
is or would be materially adverse to the business, financial condition or
operations of the Parent and its Subsidiaries taken as a whole.
(b) Neither the Parent nor any of its Subsidiaries has breached the
fiduciary rules of ERISA or engaged in any prohibited transaction in connection
with which the Parent or any of its Subsidiaries or ERISA Affiliates could be
subjected to (in the case of any such breach) a suit for damages
37
or (in the case of any such prohibited transactions) with a civil penalty
assessed under Section 502(i) of ERISA or a tax imposed by Section 4975 of the
Code, which suit, penalty or tax, in any case, would be materially adverse to
the business, financial condition or operations of the Parent and its
Subsidiaries taken as a whole.
(c) There has been no reportable event (within the meaning of
Section 4043(b) of ERISA) or any other event or condition with respect to any
Plan (other than a Multiemployer Plan) which presents a risk of termination of
any such Plan by the PBGC under circumstances which in any case could result in
liability which would be materially adverse to the business, financial condition
or operations of the Parent and its Subsidiaries taken as a whole.
(d) The present value of all vested accrued benefits under all Plans
(other than Multiemployer Plans), determined as of the end of the Parent's most
recently ended fiscal year on the basis of reasonable actuarial assumptions, did
not exceed the current value of the assets of such Plans allocable to such
vested accrued benefits. The terms "present value", "current value", and
"accrued benefit" have the meanings specified in Section 3 of ERISA.
(e) Neither the Parent nor any of its Subsidiaries is or has ever
been obligated to contribute to any Multiemployer Plan.
Section 6.9. Subsidiaries and Ownership of Stock. Schedule III is a
complete and accurate list of the Subsidiaries of the Parent, showing the
jurisdiction of incorporation or organization of each Subsidiary and showing the
percentage of the Parent's ownership of the outstanding stock or other interest
of each such Subsidiary. All of the outstanding capital stock or other interest
of each such Subsidiary has been validly issued, is fully paid and nonassessable
and is owned by the Parent free and clear of all Liens.
Section 6.10. Credit Arrangements. Schedule IV is a complete and correct
list of all credit agreements, indentures, purchase agreements, guaranties,
Capital Leases and other investments, agreements and arrangements presently in
effect providing for or relating to extensions of credit (including agreements
and arrangements for the issuance of letters of credit or for acceptance
financing or for credit lines extended for the purchase of foreign-exchange
contracts) in respect of which the Parent or any of its Subsidiaries is in any
manner directly or contingently obligated to pay money (excluding trade payables
in the ordinary course of business, and excluding other extensions of credit
that do not exceed $250,000 in the aggregate of all such other extensions of
credit), including all modifications thereof and amendments thereto; and the
maximum principal or face amounts of the credit in question, outstanding and
which can be outstanding, are correctly stated, and all Liens (if any) of any
nature given or agreed to be given as security therefor are correctly described
or indicated in such Schedule.
Section 6.11. Operation of Business. Each of the Parent and its
Subsidiaries possesses all licenses, permits, franchises, patents, copyrights,
trademarks and trade names, or rights thereto, necessary in any material respect
to conduct the business substantially as now conducted of the Parent and its
Subsidiaries taken as a whole, and neither the Parent nor any of its
Subsidiaries is in violation of any valid rights of others with respect to any
of the foregoing.
Section 6.12. Hazardous Materials. The Parent and each of its Subsidiaries
have obtained all permits, licenses and other authorizations which are required
under all Environmental Laws, except to the extent failure to have any such
permit, license or authorization would not have a material adverse effect on the
consolidated financial condition, operations or business of the Parent and its
Consolidated Subsidiaries taken as a whole. The Parent and each of its
Subsidiaries are in compliance with the terms and conditions of all such
permits, licenses and authorizations, and are also in compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations schedules and timetables contained in any applicable Environmental
Law or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder,
except to the extent failure to comply would not have a material adverse effect
on the consolidated
38
financial condition, operations or business of the Parent and its Consolidated
Subsidiaries taken as a whole.
In addition, except as set forth in Schedule V hereto:
(a) No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been filed, no
penalty has been assessed and, to the best of the Parent's knowledge, no
investigation or review is pending or threatened by any governmental or other
entity with respect to any alleged failure by the Parent or any of its
Subsidiaries to have any permit, license or authorization required under the
Environmental Laws in connection with the conduct of the business of the Parent
or any of its Subsidiaries or with respect to any generation, treatment,
storage, recycling, transportation, release or disposal, or any release as
defined in 42 U.S.C. Section 9601(22) ("Release"), of any substance regulated
under Environmental Laws ("Hazardous Materials") generated by the Parent or any
of its Subsidiaries.
(b) Neither the Parent nor any of its Subsidiaries has handled any
Hazardous Material, other than as a generator, on any property now or previously
owned or leased by the Parent or any of its Subsidiaries to an extent that it
has, or is reasonably expected to have, a material adverse effect on the
consolidated financial condition, operations or business taken as a whole of the
Parent and its Consolidated Subsidiaries; and
(i) no polychlorinated biphenyl is present at any property now or
owned or leased by the Parent or any of its Subsidiaries;
(ii) no asbestos is present at any property now owned or leased by
the Parent or any of its Subsidiaries;
(iii) there are no underground storage tanks for Hazardous
Materials, active or abandoned, at any property now owned or leased by the
Parent or any of its Subsidiaries;
to the extent that any of the same has, or is reasonably expected to have, a
material adverse effect on the consolidated financial condition, operations or
business taken as a whole of the Parent and its Consolidated Subsidiaries. No
Hazardous Materials have been Released, in a reportable quantity, where such a
quantity has been established by statute, ordinance, rule, regulation or order,
at, on or under any property now owned by the Parent or any of its Subsidiaries.
(c) Neither the Parent nor any of its Subsidiaries has transported
or arranged for the transportation of any Hazardous Material to any location
which is listed on the National Priorities List under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
("CERCLA"), listed for possible inclusion on the National Priorities List by the
Environmental Protection Agency in the Comprehensive Environmental Response and
Liability Information System as provided by 40 C.F.R. Section 300.5 ("CERCLIS")
or on any similar state list or which is the subject of federal, state or local
enforcement actions or other investigations which are reasonably expected to
lead to claims against the Parent or any of its Subsidiaries for clean-up costs,
remedial work, damages to natural resources or for personal injury claims,
including, but not limited to, claims under CERCLA that would be materially
adverse to the business, financial condition or operations of the Parent and its
Consolidated Subsidiaries taken as a whole.
(d) No Hazardous Material generated by the Parent or any of its
Subsidiaries has been recycled, treated, stored, disposed of or Released by the
Parent or any of its Subsidiaries at any location other than those listed in
Schedule III hereto.
(e) No oral or written notification of a Release of a Hazardous
material has been filed by or on behalf of the Parent or any of its Subsidiaries
and no property now owned or leased by the
39
Parent or any of its Subsidiaries is listed or proposed for listing on the
National Priorities List promulgated pursuant to CERCLA, on CERCLIS or on any
similar state list of sites requiring investigation or clean-up.
(f) There are no Liens arising under or pursuant to any
Environmental laws which have been imposed on any of the real property or
properties owned or leased by the Parent or any of its Subsidiaries, and (to the
best of the Parent's knowledge) no government actions have been taken or are in
process which could subject any of such properties to such Liens and neither the
Parent nor any of its Subsidiaries would be required to place any notice or
restriction relating to the presence of Hazardous Materials at any property
owned by it in any deed to such property.
(g) There have been no environmental investigations, studies,
audits, test, reviews or other analyses conducted by or which are in the
possession of the Parent or any of its Subsidiaries in relation to any property
or facility now or previously owned or leased by the Parent or any of its
Subsidiaries which have not been made available to the Lenders, except to the
extent prepared to satisfy routine reporting obligations under the Environmental
Laws.
Section 6.13. No Default on Outstanding Judgments or Orders. Each of the
Parent and its Subsidiaries has satisfied all judgments and neither the Parent
nor any of its Subsidiaries is in default with respect to any judgment, writ,
injunction, decree, rule or regulation of any court, arbitrator or federal,
state, municipal or other governmental authority, commission, board, bureau,
agency or instrumentality, domestic or foreign, except where any such defaults
in the aggregate would not result in a material adverse effect on the business,
financial condition or operations of the Parent and its Subsidiaries taken as a
whole.
Section 6.14. No Defaults on Other Agreements. Neither the Parent nor any
of its Subsidiaries is subject to any charter or corporate restriction which is
reasonably expected to have a material adverse effect on the business,
properties, assets, operations or conditions, financial or otherwise, of the
Parent or any of its Subsidiaries, or the ability of any Borrower or Guarantor
to carry out its obligations under the Facility Documents to which it is a
party. Neither the Parent nor any of its Subsidiaries is a party to any
indenture, loan or credit agreement or any lease or other agreement or
instrument which is reasonably expected to have a material adverse effect on the
ability of any Borrower or Guarantor to carry out its obligations under the
Facility Documents to which it is a party. The Parent is not in default in any
respect under any of the Prudential Existing Notes (or under either note
agreement pursuant to which they were issued) or under any outstanding Future
Permitted Private Placement Debt (or under any note or other agreement pursuant
to which such Debt shall have been issued). Neither the Parent nor any of its
Subsidiaries is in default in any material respect under any other agreement or
instrument to which the Parent or such Subsidiary is a party, except where any
such defaults in the aggregate would not result in a material adverse effect on
the business, financial condition or operations of the Parent and its
Subsidiaries taken as a whole.
Section 6.15. Labor Disputes and Acts of God. Neither the business nor the
properties of the Parent or of any of its Subsidiaries are affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy or other casualty
(whether or not covered by insurance), materially and adversely affecting the
business, financial condition or operations of the Parent and its Subsidiaries
taken as a whole.
Section 6.16. Governmental Regulation. Neither the Parent nor any of its
Subsidiaries is subject to regulation under the Public Utility Holding Company
Act of 1935, the Investment Company Act of 1940, the Interstate Commerce Act,
the Federal Power Act or any statute or regulation limiting its ability to incur
indebtedness for money borrowed or to obtain letters of credit as contemplated
hereby.
Section 6.17. Partnerships. Neither the Parent nor any of its Subsidiaries
is a partner in any partnership.
Section 6.18. No Forfeiture. No Forfeiture Proceeding is pending.
40
Section 6.19. Solvency.
(a) The present fair saleable value of the assets of each Borrower
after giving effect to all the transactions contemplated by the Facility
Documents and the funding of all Revolving Credit Commitments hereunder exceeds
the amount that will be required to be paid on or in respect of the existing
debts and other liabilities (including contingent liabilities) of such Borrower
as they mature.
(b) The property of each Borrower does not constitute unreasonably
small capital for such Borrower to carry out its business as now conducted and
as presently proposed to be conducted including the capital needs of such
Borrower.
(c) No Borrower intends to, nor does any Borrower believe that it
will, incur debts beyond its ability to pay such debts as they mature (taking
into account the timing and amounts of cash to be received by such Borrower, and
of amounts to be payable on or in respect of debt of such Borrower). The cash
available to each Borrower after taking into account all other anticipated uses
of the cash of such Borrower, is anticipated to be sufficient to pay all such
amounts on or in respect of debt of such Borrower when such amounts are required
to be paid.
(d) No Borrower believes that final judgments against it in actions
for money damages will be rendered at a time when, or in an amount such that,
such Borrower will be unable to satisfy any such judgments promptly in
accordance with their terms (taking into account the maximum reasonable amount
of such judgments in any such actions and the earliest reasonable time at which
such judgments might be rendered). The cash available to each Borrower after
taking into account all other anticipated uses of the cash of such Borrower
(including the payments on or in respect of debt referred to in paragraph (c) of
this Section 6.19), is anticipated to be sufficient to pay all such judgments
promptly in accordance with their terms.
Section 6.20. Certain Particular Assurances as to the Foreign Subsidiary
Borrowers.(a) (a) This Agreement and each of the other Facility Documents to
which a Foreign Subsidiary Borrower is intended to be a party are in proper
legal form under the law of Switzerland for the enforcement thereof against such
Foreign Subsidiary Borrower under such law, and if this Agreement and each of
such other Facility Documents were stated to be governed by such law, they would
constitute legal, valid and binding obligations of such Foreign Subsidiary
Borrower under such law, enforceable in accordance with their respective terms.
All formalities required in Switzerland for the validity and enforceability of
this Agreement and each of such other Facility Documents (including, without
limitation, any necessary registration, recording or filing with any court or
other authority in Switzerland) have been accomplished, and no Taxes are
required to be paid to Switzerland, or any political subdivision thereof or
therein, and no notarization is required, for the validity and enforceability
hereof or thereof.
(b) This Agreement and the other Facility Documents to which a
Foreign Subsidiary Borrower is intended to be a party and the obligations
evidenced hereby and thereby are and will at all times be direct and
unconditional general obligations of such Foreign Subsidiary Borrower, and rank
and will at all times rank in right of payment and otherwise at least pari passu
with all other unsecured Debt of such Foreign Subsidiary Borrower whether now
existing or hereafter outstanding. There exists no Lien (including any Lien
arising out of any attachment, judgment or execution), nor any segregation or
other preferential arrangement of any kind, on, in or with respect to any of the
property or revenues of any Foreign Subsidiary Borrower or any of its
Subsidiaries, except as expressly permitted by Section 8.3.
(c) Each Foreign Subsidiary Borrower is subject to civil and
commercial law with respect to its obligations under this Agreement and each of
the other Facility Documents to which it is intended to be a party. The
execution, delivery and performance by each Foreign Subsidiary Borrower of this
Agreement and each of such other Facility Documents constitute private and
commercial acts rather than public or governmental acts. No Foreign Subsidiary
Borrower, nor any of its properties or revenues, is entitled to any right of
immunity in any jurisdiction from suit, court jurisdiction, judgment, attachment
(whether before or after judgment), set-off or execution of a judgment or from
any other legal process or
41
remedy relating to the obligations of such Foreign Subsidiary Borrower under
this Agreement or any of such other Facility Documents.
(d) The inclusion in this Article of the representations and
warranties contained in this Section shall not limit the generality of the other
representations and warranties contained in this Article with reference to the
Foreign Subsidiary Borrowers.
ARTICLE 7. AFFIRMATIVE COVENANTS.
So long as any of the Notes shall remain unpaid, or any Letter of Credit
shall remain outstanding, or any Lender shall have any Revolving Credit
Commitment under this Agreement, the Parent shall:
Section 7.1. Maintenance of Existence. Preserve and maintain (except as
otherwise permitted by Section 8.7 or Section 8.8 or Section 8.10), and cause
each of its Subsidiaries (other than Inactive Subsidiaries) to preserve and
maintain (except as otherwise permitted by Section 8.7 or Section 8.8 or Section
8.10), its corporate existence and good standing in the jurisdiction of its
incorporation, and qualify and remain qualified, and cause each of its
Subsidiaries to qualify and remain qualified, as a foreign corporation in each
jurisdiction in which the failure to be so qualified would have a material
adverse effect on (a) the business, financial condition or operations of the
Parent and its Subsidiaries taken as a whole; (b) the ability of any Borrower to
perform any of its obligations under any Facility Document; (c) the legality,
validity or enforceability of any Facility Document; or (d) the rights of, or
remedies available to the Administrative Agent and the Lenders under any
Facility Document.
Section 7.2. Conduct of Business. Continue, and cause each of its
Subsidiaries (other than Inactive Subsidiaries) to continue, to engage primarily
in the Core Business.
Section 7.3. Maintenance of Properties. Maintain, keep and preserve, and
cause each of its Subsidiaries to maintain, keep and preserve, all of the
properties (tangible and intangible) necessary or useful in the proper conduct
of the business of the Parent and its Subsidiaries in good working order and
condition (ordinary wear and tear excepted), except to the extent that such
properties are not material to the business, financial condition or operations
of the Parent and its Subsidiaries taken as a whole.
Section 7.4. Maintenance of Records. Keep, and cause each of its
Subsidiaries to keep, adequate records and books of account, in which complete
entries will be made in compliance with then-current guidelines as to generally
accepted accounting principles, reflecting all financial transactions of the
Parent and its Subsidiaries.
Section 7.5. Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with financially sound and reputable
insurance companies or associations in such amounts and covering such risks as
are usually carried by companies engaged in the same or a similar business and
similarly situated, which insurance may provide for reasonable deductibility
from coverage thereof.
Section 7.6. Compliance with Laws; Payment of Taxes.(a) (a) Comply, and
cause each of its Subsidiaries to comply, with all applicable laws, rules,
regulations and orders, the noncompliance with which would materially adversely
affect (i) the business, financial condition or operations of the Parent and its
Subsidiaries taken as a whole, (ii) the ability of any Borrower to perform any
of its obligations under any Facility Document, (iii) the legality, validity or
enforceability of any Facility Document, or (iv) the rights of or remedies
available to the Administrative Agent and the Lenders under any Facility
Document. Without limiting the generality of the foregoing, the Parent shall
cause each Foreign Subsidiary Borrower to obtain and maintain at all times in
effect all such governmental licenses, authorizations, consents, permits and
approvals as may be required for such Foreign Subsidiary Borrower to borrow and
repay the Borrowings of such Foreign Subsidiary Borrower and to comply with all
the other obligations of such
42
Foreign Subsidiary Borrower under this Agreement and the other Facility
Documents to which such Foreign Subsidiary Borrower is a party; and
(b) Pay or discharge, and cause each of its Subsidiaries to pay or
discharge, before the same become delinquent all taxes, assessments and
governmental charges imposed upon the Parent or any Subsidiary or any of their
respective properties; provided however that the Parent shall not be required to
pay or discharge or cause to be paid or discharged, any such tax, assessment or
governmental charge the applicability or validity of which is being contested by
the Parent or such Subsidiary in good faith by appropriate proceedings and for
which adequate reserves have been established in accordance with GAAP.
Section 7.7. Right of Inspection. At any reasonable time and from time to
time, permit the Administrative Agent or any Lender or any agent or
representative thereof, to examine and make copies and abstracts from the
records and books of account of, and visit the properties of, the Parent and any
of its Subsidiaries on at least one day's advance notice, and to discuss the
affairs, finances and accounts of the Parent and any such Subsidiary with any of
their respective officers and directors and the Parent's independent
accountants.
Section 7.8. Reporting Requirements. Furnish directly to each of the
Lenders:
(a) as soon as available and in any event within 120 days after the
end of each fiscal year of the Parent, a consolidated and consolidating balance
sheet of the Parent and its Consolidated Subsidiaries as of the end of such
fiscal year and a consolidated and consolidating income statement and statements
of cash flows and changes in stockholders' equity of the Parent and its
Consolidated Subsidiaries for such fiscal year, all in reasonable detail and
stating in comparative form the respective consolidated and consolidating
figures for the corresponding date and period in the prior fiscal year and all
prepared in accordance with GAAP and as to the consolidated statements audited
and accompanied by an opinion thereon acceptable to the Administrative Agent and
each of the Lenders by PricewaterhouseCoopers LLP or other independent
accountants of national standing selected by the Parent and acceptable to the
Required Lenders;
(b) as soon as available and in any event within 75 days after the
end of each of the first three quarters of each fiscal year of the Parent, a
consolidated and consolidating balance sheet of the Parent and its Consolidated
Subsidiaries as of the end of such quarter and a consolidated and consolidating
income statement and statements of cash flows and changes in stockholders'
equity, of the Parent and its Consolidated Subsidiaries for the period
commencing at the end of the previous fiscal year and ending with the end of
such quarter, all in reasonable detail and stating in comparative form the
respective consolidated and consolidating figures for the corresponding date and
period in the previous fiscal year and all prepared in accordance with GAAP and
certified by the chief financial officer of the Parent (subject to year-end
adjustments);
(c) promptly upon receipt thereof, copies of any reports submitted
to the Parent or any of its Subsidiaries by independent certified public
accountants in connection with examination of the financial statements of the
Parent or any such Subsidiary made by such accountants;
(d) simultaneously with the delivery of the financial statements
referred to above, a certificate of the chief financial officer of the Parent
(i) certifying that to the best of his knowledge no Default or Event of Default
has occurred and is continuing or, if a Default or Event of Default has occurred
and is continuing, a statement as to the nature thereof and the action which is
proposed to be taken with respect thereto, and (ii) with computations
demonstrating whether there has been compliance with the covenants contained in
Article 9, and with the financial covenants contained in the agreements between
the Parent and The Prudential Insurance Company of America pursuant to which the
Prudential Existing Notes and (if applicable) the Prudential Shelf Notes have
been issued, and with the financial covenants contained in the agreements
pursuant to which all other Future Permitted Private Placement Debt shall have
been issued;
43
(e) simultaneously with the delivery of the annual financial
statements referred to in Section 7.8(a), a certificate of the independent
public accountants who audited such statements to the effect that, in making the
examination necessary for the audit of such statements, they have obtained no
knowledge of any condition or event which constitutes a Default or Event of
Default, or if such accountants shall have obtained knowledge of any such
condition or event, specifying in such certificate each such condition or event
of which they have knowledge and the nature and status thereof;
(f) promptly after the commencement thereof, notice of all actions,
suits, and proceedings before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, affecting the
Parent or any of its Subsidiaries which, if determined adversely to the Parent
or such Subsidiary, would reasonably be expected to have a material adverse
effect on (i) the financial condition, business, or operations of the Parent and
its Subsidiaries taken as a whole, (ii) the ability of any Borrower to perform
any of its obligations under any Facility Document, (iii) the legality, validity
or enforceability of any Facility Document, or (iv) the rights of or remedies
available to the Administrative Agent and the Lenders under any Facility
Document;
(g) as soon as possible and in any event within 10 days after the
occurrence of each Default or Event of Default a written notice setting forth
the details of such Default or Event of Default and the action which is proposed
to be taken by the Parent with respect thereto;
(h) as soon as possible, and in any event within ten days after the
Parent receives notice from the PBGC or any other Person, or otherwise acquires
knowledge, that any of the events or conditions specified below with respect to
any Plan or Multiemployer Plan have occurred or exist, a statement signed by a
senior financial officer of the Parent setting forth details respecting such
event or condition and the action, if any, which the Parent or its ERISA
Affiliate proposes to take with respect thereto (and a copy of any report or
notice required to be filed with or given to PBGC by the Parent or an ERISA
Affiliate with respect to such event or condition):
(i) any reportable event, as defined in Section 4043(b) of
ERISA, with respect to a Plan, as to which PBGC has not by
regulation waived the requirement of Section 4043(a) of ERISA that
it be notified within 30 days of the occurrence of such event
(provided that a failure to meet the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA including, without
limitation, the failure to make on or before its due date a required
installment under Section 412(m) of the Code or Section 302(e) of
ERISA, shall be a reportable event regardless of the issuance of any
waivers in accordance with Section 412(d) of the Code) and any
request for a waiver under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of ERISA of a notice
of intent to terminate any Plan or any action taken by the Parent or
an ERISA Affiliate to terminate any Plan;
(iii) the institution by PBGC of proceedings under Section
4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or the receipt by the Parent or any
ERISA Affiliate of a notice from a Multiemployer Plan that such
action has been taken by PBGC with respect to such Multiemployer
Plan;
(iv) the complete or partial withdrawal from a Multiemployer
Plan by the Parent or any ERISA Affiliate that results in liability
under Section 4201 or 4204 of ERISA (including the obligation to
satisfy secondary liability as a result of a purchaser default) or
the receipt of the Parent or any ERISA Affiliate of notice from a
Multiemployer Plan that it is in reorganization or insolvency
pursuant to Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of ERISA;
44
(v) the institution of a proceeding by a fiduciary or any
Multiemployer Plan against the Parent or any ERISA Affiliate to
enforce Section 515 of ERISA, which proceeding is not dismissed
within 30 days;
(vi) the adoption of an amendment to any Plan that pursuant to
a notification letter from the Internal Revenue Service under
Section 401(a)(29) of the Code or Section 307 of ERISA would result
in the loss of tax-exempt status of the trust of which such Plan is
a part if the Parent or an ERISA Affiliate fails to timely provide
security to the Plan in accordance with the provisions of said
Sections;
(vii) any event or circumstance exists which may reasonably be
expected to constitute grounds for the Parent or any ERISA Affiliate
to incur liability under Title IV of ERISA or under Sections
412(c)(11) or 412(n) of the Code with respect to any Plan; and
(viii) the Unfunded Benefit Liabilities of one or more Plans
increase after the date of this Agreement in an amount which is
material in relation to the financial condition of the Parent.
(i) promptly after the request of any Lender, copies of each annual
report filed pursuant to Section 104 of ERISA with respect to each Plan
(including, to the extent required by Section 104 of ERISA, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information referred to in Section 103) and each
annual report filed with respect to each Plan under Section 4065 of ERISA;
provided, however, that in the case of a Multiemployer Plan, such annual reports
shall be furnished only if they are available to the Parent or an ERISA
Affiliate;
(j) promptly after the furnishing thereof, copies of any statement
or report furnished to any other party pursuant to the terms of any indenture,
loan or credit or similar agreement and not otherwise required to be furnished
to the Lenders pursuant to any other clause of this Section 7.8;
(k) promptly after the sending or filing thereof, copies of all
proxy statements, financial statements and reports which the Parent or any of
its Subsidiaries sends to its stockholders, and copies of all regular, periodic
and special reports, and all registration statements which the Parent or any
such Subsidiary files with the Securities and Exchange Commission or any
governmental authority which may be substituted therefor, or with any national
securities exchange;
(l) promptly after the commencement thereof or promptly after the
Parent knows of the commencement or threat thereof, notice of any Forfeiture
Proceeding;
(m) simultaneously with the delivery of the annual financial
statements referred to in Section 7.8(a), (i) a consolidating balance sheet of
the Parent and its domestic Subsidiaries, and a consolidating balance sheet of
the non-domestic Subsidiaries of the Parent, as of the end of the applicable
fiscal year; and (ii) consolidating statements of income of the Parent and its
domestic Subsidiaries for the year then ended, and consolidating statements of
income of the non-domestic Subsidiaries of the Parent for the year then ended;
in each case, in a form sufficient to enable the Lenders to determine the
amounts owed by and paid by the Parent and its domestic Subsidiaries to the
non-domestic Subsidiaries of the Parent, and vice versa;
(n) simultaneously with the delivery of the annual financial
statements referred to in Section 7.8(a), a letter from the accounting firm that
audited such financial statements, addressed to the Administrative Agent, the
Lenders, the Swingline Bank and the Issuing Bank, acknowledging their reliance
on such financial statements, in compliance with N.J.S.A. 2A:53A-25 (which
statute need not be expressly referred to in such letter).
45
(o) such other information respecting the condition or operations,
financial or otherwise, of the Parent or any of its Subsidiaries as the
Administrative Agent or any Lender may from time to time reasonably request.
Section 7.9. Subsidiary Guarantee. Cause:
(a) each domestic Subsidiary of the Parent whose assets at any time
represent ten percent (10%) or more of the total assets of the Parent and
its Consolidated Subsidiaries, and
(b) each domestic Subsidiary of the Parent that owns any trademark,
tradename, tradedress or patent as a result of a transfer thereof by the
Parent or any of its Subsidiaries to such domestic Subsidiary, and
(c) each other domestic Subsidiary of the Parent, other than
domestic Subsidiaries whose combined assets represent less than fifteen
percent (15%) of the total assets of the Parent and its Consolidated
Subsidiaries,
to execute and deliver to the Administrative Agent a Subsidiary Guarantee,
together with written evidence satisfactory to the Administrative Agent that
such Subsidiary Guarantee has been duly authorized by all necessary action; the
same shall be delivered to the Administrative Agent (in multiple duplicate
original copies, one for each Lender, the Swingline Bank, the Issuing Bank and
the Administrative Agent) within 30 days after the date on which (in the case of
clause (a)) the assets of such Subsidiary first represent 10% or more of the
total assets of the Parent and its Consolidated Subsidiaries, or (in the case of
clause (b)) such Subsidiary acquires ownership of such trademark, tradename,
tradedress or patent, or (in the case of clause (c)) the 15% limit described in
clause (c) is exceeded.
Section 7.10. Equal and Ratable Lien. Make or cause to be made, if any
property (whether now owned or hereafter acquired) is subjected to a Lien in
violation of Section 8.3, effective provision satisfactory in form and substance
to the Required Lenders whereby the obligations of the Borrowers under this
Agreement and the Notes will be secured by such Lien equally and ratably with
any and all other liabilities secured thereby. Such violation of Section 8.3
shall be an Event of Default, whether or not any such provision is made pursuant
to this Section.
ARTICLE 8. NEGATIVE COVENANTS.
So long as any of the Notes shall remain unpaid, or any Letter of Credit
shall be outstanding, or any Lender shall have any Revolving Credit Commitment
under this Agreement, the Parent shall not:
Section 8.1. Debt. Create, incur, assume or suffer to exist, or permit any
of its Subsidiaries to create, incur, assume or suffer to exist any Debt,
except:
(a) Debt of each Borrower under this Agreement or the other Facility
Documents (including, for the avoidance of doubt, any increase under
Section 2.16);
(b) Debt described in Schedule IV(excluding Prudential Shelf Notes),
including renewals, extensions or refinancings thereof (and including
refinancings by institutions other than those institutions identified on
Schedule IV), provided that the principal amount thereof does not
increase;
(c) Debt of the Parent subordinated (on terms satisfactory to the
Administrative Agent and the Required Lenders) to the Parent's obligations
under this Agreement and the other Facility Documents;
46
(d) Debt of the Parent to any Subsidiary; and Debt of any Subsidiary
Guarantor to the Parent or to another Subsidiary Guarantor; and Debt of
any Subsidiary that is not a Subsidiary Guarantor (i) to the Parent of up
to $10,000,000 outstanding at any time, or (ii) to either Foreign
Subsidiary Borrower of up to $10,000,000 outstanding at any time, or (iii)
to any other Subsidiary that is not a Subsidiary Guarantor, provided that
the aggregate of all such Debt of Subsidiaries that are not Subsidiary
Guarantors to the Parent and the Foreign Subsidiary Borrowers shall not
exceed $15,000,000 at any time;
(e) Debt consisting of leases permitted under Section 8.4 or of
guaranties permitted under subsections (a), (b), (c) and (d) of Section
8.2;
(f) Future Permitted Private Placement Debt;
(g) Debt of the Parent or any Subsidiary consisting of liability in
respect of letters of credit (excluding Letters of Credit issued under
this Agreement) provided that the aggregate amount of such liability
outstanding at any time shall not exceed $3,000,000 as to all of the
Parent and its Subsidiaries (which liability shall include liability for
outstanding letters of credit that have not been drawn upon, as well as
outstanding reimbursement obligations as to letters of credit that have
been drawn upon; and which $3,000,000 limitation shall be inclusive of the
letters of credit identified in Schedule IV and renewals and extensions
thereof);
(h) other Debt of the Parent or any Subsidiary of the Parent,
provided that the aggregate amount of such Debt outstanding at any time
shall not exceed $15,000,000 (as to all of the Parent and its
Subsidiaries) (which $15,000,000 limitation shall be inclusive of the
outstanding amounts of the working capital lines, the foreign lines and
the letters of credit referred to in Schedule IV and renewals, extensions
and refinancings thereof); and provided further that such Debt shall have
a maturity of not later than one year after the incurrence thereof; and
provided further that:
(i) in the case of indebtedness of the Parent or any domestic
Subsidiary for money borrowed, such indebtedness shall be owing to
one or more of the Lenders independently of this Agreement; and
(ii) in the case of non-domestic Subsidiaries of the Parent,
the aggregate amount of such Debt as to all non-domestic
Subsidiaries that is outstanding at any time shall not exceed
$5,000,000 (which $5,000,000 limitation shall be inclusive of the
foreign lines referred to in Schedule IV and renewals, extensions
and refinancings thereof); (such Debt described in this clause (ii)
may be payable to one or more of the Lenders or to any other
creditor);
and provided further that (as to all of the Parent and its Subsidiaries in
the aggregate) the amount of outstanding Debt permitted by this clause (h)
that is secured by a Lien permitted by Section 8.3(h) shall not exceed
$8,000,000 at any time; and
(i) Debt of the Parent or any domestic Subsidiary of the Parent not
otherwise permitted by this Section, provided that:
(i) 50% of the amount of the gross proceeds of such Debt is
(immediately upon the incurrence of such Debt) paid to the
Administrative Agent for the account of the Lenders and the Issuing
Bank (x) for application to the reduction of the outstanding
Swingline Loans and (if the outstanding amount of the Swingline
Loans is, or is thereby reduced to, zero) the outstanding Syndicated
Loans; and (y) (if the
47
outstanding amount of the Syndicated Loans is, or is thereby reduced
to, zero) for deposit with the Administrative Agent in the Cash
Collateral Account as security for the Parent's reimbursement
obligation in respect of Letters of Credit; and
(ii) the Total Revolving Credit Commitment is permanently
reduced by an amount equal to 50% of the amount of the gross
proceeds of such Debt; and
(iii) the Parent provides to Administrative Agent at least 20
days before the incurrence of such Debt, for distribution to the
Lenders, a pro-forma consolidated balance sheet and income statement
of the Parent and its Consolidated Subsidiaries after giving effect
to the incurrence of such Debt, together with a written
certification of the Parent that the incurrence of such Debt will
not result in a Default or an Event of Default, either immediately
or (based upon the Parent's reasonable and good faith projections)
at any time thereafter.
The Parent further covenants that any letter of credit in respect of which the
Parent or any of its Subsidiaries become liable as permitted by this Section
will be for less than $1,000,000 (excluding Letters of Credit issued hereunder).
Section 8.2. Guaranties, Etc. Assume, guarantee, endorse or otherwise be
or become directly or contingently responsible or liable, or permit any of its
Subsidiaries to assume, guarantee, endorse or otherwise be or become directly or
indirectly responsible or liable (including, but not limited to, an agreement to
purchase any obligation, stock, assets, goods or services or to supply or
advance any funds, asset, goods or services, or an agreement to maintain or
cause such Person to maintain a minimum working capital or net worth or
otherwise to assure the creditors of any Person against loss) for the
obligations of any Person, except
(a) guaranties by endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of business;
(b) guaranties by Subsidiaries pursuant to Section 7.9 and the
Parent Guarantee;
(c) guaranties by the Parent of ordinary rent obligations incurred
by any of its Subsidiaries for the lease of retail stores; provided,
however, that the aggregate of the amount so guaranteed for foreign
Subsidiaries shall not exceed $3,000,000 at any time;
(d) guaranties by the Parent of obligations incurred by any of its
domestic Subsidiaries in the ordinary course of business other than for
borrowed money, letters of credit or acceptance financing;
(e) guaranties by the Parent in favor of any of its Subsidiaries,
and guaranties by any Subsidiary of the Parent in favor of the Parent or
another Subsidiary of the Parent, as to obligations owing to the
guaranteed party by a Subsidiary of the Parent or by the Parent; provided,
however, that in no event shall the outstanding guaranty liability
permitted by this clause (e) exceed at any time $15,000,000 as to the
Parent and its Subsidiaries in the aggregate;
(f) letters of credit permitted under Section 8.1 (including Letters
of Credit issued hereunder);
(g) guaranties by the Subsidiary Guarantors of the Prudential
Existing Notes and any Future Permitted Private Placement Debt; and
48
(h) other guaranties, provided however that in no event shall the
outstanding guaranty liability permitted by this clause (h) exceed at any
time $1,000,000 as to the Parent and its Subsidiaries in the aggregate.
Section 8.3. Liens. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any Lien,
upon or with respect to any of its properties, now owned or hereafter acquired
(including, without limitation, any Lien upon any stock or other securities
issued by a Subsidiary), except:
(a) Liens for taxes or assessments or other government charges or
levies if not yet due and payable or if due and payable if they are being
contested in good faith by appropriate proceedings and for which
appropriate reserves are maintained;
(b) Liens imposed by law, such as mechanic's, materialmen's,
landlord's, warehousemen's and carrier's Liens, and other similar Liens,
securing obligations incurred in the ordinary course of business which are
not past due for more than 30 days, or which are being contested in good
faith by appropriate proceedings and for which appropriate reserves have
been established;
(c) Liens under workmen's compensation, unemployment insurance,
social security or similar legislation (other than ERISA);
(d) Liens, deposits or pledges to secure the performance of bids,
tenders, contracts (other than contracts for the payment of money), leases
(permitted under the terms of this Agreement), public or statutory
obligations, surety, stay, appeal, indemnity, performance or other similar
bonds, or other similar obligations arising in the ordinary course of
business;
(e) judgment and other similar Liens arising in connection with
court proceedings; provided that the execution or other enforcement of
such Liens is effectively stayed and the claims secured thereby are being
actively contested in good faith and by appropriate proceedings;
(f) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate, do not materially interfere with the
occupation, use and enjoyment by the Parent or any such Subsidiary of the
property or assets encumbered thereby in the normal course of its business
or materially impair the value of the property subject thereto;
(g) Liens securing obligations of such a Subsidiary to the Parent;
(h) purchase money Liens on any property hereafter acquired or the
assumption of any Lien on property existing at the time of such
acquisition, or a Lien incurred in connection with any conditional sale or
other title retention agreement or a Capital Lease; provided that:
(i) any property subject to any of the foregoing is acquired
by the Parent or any such Subsidiary in the ordinary course of its
business and the Lien on any such property is created
contemporaneously with such acquisition;
(ii) the obligation secured by any Lien so created, assumed or
existing shall not exceed 95% of the lesser of cost or fair market
value as of the time of acquisition of the property covered thereby
to the Parent or such Subsidiary acquiring the same;
(iii) each such Lien shall attach only to the property so
acquired and fixed improvements thereon;
49
(iv) the obligations secured by such Lien are permitted by the
proviso at the end of Section 8.1(h) and the related expenditure is
permitted under Section 9.4;
(i) Liens identified on Schedule IV, including renewals, extensions
or refinancings thereof (and including refinancings by institutions other
than those institutions identified on Schedule IV), provided that the
principal amount secured by such Liens does not increase;
(j) other Liens, provided however that in no event shall the
outstanding liabilities secured by Liens permitted by this clause (j)
exceed at any time $1,000,000 as to the Parent and its Subsidiaries in the
aggregate.
Section 8.4. Leases. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any
obligation as lessee for the rental or hire of any real or personal property,
except:
(a) leases existing on the date of this Agreement and any extensions
or renewals thereof;
(b) Capital Leases permitted by Sections 8.1 and 8.3; and
(c) other leases (excluding Capital Leases) that are, in the
judgment of the board of directors of the Parent, appropriate for the
business objectives of the Parent and its Subsidiaries.
Section 8.5. Investments. Make, or permit any of its Subsidiaries to make,
any loan or advance to any Person or purchase or otherwise acquire, or permit
any such Subsidiary to purchase or otherwise acquire, any capital stock, assets
(except as otherwise permitted by this Agreement), obligations or other
securities of, make any capital contribution to, or otherwise invest in, or
acquire any interest in, any Person, except:
(a) direct obligations of the United States of America or any agency
thereof with maturities of two years or less from the date of acquisition;
(b) commercial paper of a domestic issuer rated at least "A-1"by
Standard & Poor's or "P-1"by Xxxxx'x Investors Service, Inc.;
(c) certificates of deposit and time deposits with maturities of one
year or less from the date of acquisition issued by any commercial bank
whose (or whose parent company's) short-term commercial paper rating is
rated at least "A-1" by Standard & Poors or "P-1" by Xxxxx'x Investors
Service, Inc.;
(d) for stock, obligations or securities received in settlement of
debts (created in the ordinary course of business) owing to the Parent or
any such Subsidiary;
(e) inventory purchased in the ordinary course of business of the
Parent or such Subsidiary;
(f) any Acquisition permitted by Section 8.11;
(g) investments in stocks of investment companies registered under
the Investment Company Act of 1940 which are no-load money-market funds
and which invest primarily in obligations of the type described in clauses
(a), (b) and (c) of this Section and which are classified as current
assets in accordance with GAAP, provided that any such investment company
shall have an aggregate net asset value of not less than $50,000,000;
50
(h) advances to employees of the Parent or any of its Subsidiaries
that do not exceed $500,000 outstanding at any time in the aggregate as to
all such employees of the Parent and its Subsidiaries;
(i) loans and advances permitted by Section 8.1(d); and other
investments by any foreign Subsidiary of the Parent (excluding the Foreign
Subsidiary Borrowers) in any other foreign Subsidiary of the Parent that
is wholly owned by the Parent;
(j) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and entered
into with a financial institution satisfying the criteria described in
clause (c) above;
(k) other investments of up to $10,000,000 in the aggregate as to
all of the Parent and its Subsidiaries;
(l) as permitted under Sections 8.7(c) and 8.7(d); and
(m) Permitted Investments made by the Administrative Agent for the
account of the Parent or a Foreign Subsidiary Borrower pursuant to Section
2.13(f).
Section 8.6. Dividends. Declare or pay any dividends (other than dividends
payable solely in shares of its common stock), purchase, redeem, retire or
otherwise acquire for value any of its capital stock now or hereafter
outstanding, or make any distribution of assets to its stockholders as such
whether in cash, assets or in obligations of the Parent, or allocate or
otherwise set apart any sum for the payment of any dividend or distribution on,
or for the purchase, redemption or retirement of any shares of its capital
stock, or make any other distribution by reduction of capital or otherwise in
respect of any shares of its capital stock, or permit any of its Subsidiaries to
do any of the foregoing, or permit any of its Subsidiaries to purchase or
otherwise acquire for value any stock of the Parent or another such Subsidiary
(except as permitted by Section 8.8(b)), except that the Parent may pay
dividends or acquire its stock (or both), provided that:
(x) no Default or Event of Default exists either immediately prior
to such payment or acquisition, or after giving effect to such payment or
acquisition; and
(y) the aggregate amount expended by the Parent after January 31,
2003 for all such dividends and acquisitions does not exceed the sum of
(i) $25,000,000, plus (ii) 50% of the cumulative net income of the Parent
for its fiscal year ending January 31, 2004 and each subsequent fiscal
year that shall have ended prior to the payment of such dividend or the
acquisition of such stock (which net income for any year shall be adjusted
to exclude non-recurring gains, except to the extent that the Parent shall
have received actual cash representing such gain in such year), less (iii)
100% of the cumulative net loss (if any) of the Parent for its fiscal year
ending January 31, 2004 and each subsequent fiscal year that shall have
ended prior to the payment of such dividend or the acquisition of such
stock.
and except that any Subsidiary may pay dividends or make distributions to the
Parent and to any wholly-owned Subsidiary of the Parent.
Section 8.7. Sale of Assets. Sell, lease, assign, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, assign, transfer
or otherwise dispose of, any of its now owned or hereafter acquired assets
(including, without limitation, shares of stock and indebtedness of such
Subsidiaries, receivables and leasehold interests), except:
(a) for inventory disposed of in the ordinary course of business;
51
(b) the sale or other disposition of assets no longer used or useful
in the conduct of its business;
(c) that any such Subsidiary may sell, lease, assign, transfer or
otherwise dispose of its assets to the Parent, and except that any such
Subsidiary (other than a Foreign Subsidiary Borrower) may sell, lease,
assign, transfer or otherwise dispose of its assets to another Subsidiary
that shall have previously executed and delivered a Guarantee pursuant to
Section 7.9, and except that any Foreign Subsidiary Borrower may sell,
lease, assign, transfer or otherwise dispose of its assets to the other
Foreign Subsidiary Borrower;
(d) that any foreign Subsidiary of the Parent (other than a Foreign
Subsidiary Borrower) may sell, lease, assign, transfer or otherwise
dispose of its assets to another foreign Subsidiary of the Parent that is
wholly owned by the Parent;
(e) as contemplated under Section 8.8(a) or (b); and
(f) for Designated Sales (provided, however, that all the
outstanding shares of each Foreign Subsidiary Borrower shall at all times
be wholly owned directly or indirectly by the Parent).
In no event shall any disposition of assets by the Parent or any Subsidiary be
for less than fair market value.
Section 8.8. Stock of Subsidiaries, Etc. Sell or otherwise dispose of, or
permit any of its Subsidiaries to sell or otherwise dispose of, any shares of
capital stock of any of its Subsidiaries, except:
(a) for a sale of all or substantially all of the stock of any
Subsidiary for less than $3,000,000 where (i) the sales proceeds are made
available to the Parent and (ii) such proceeds represent the fair value of
such Subsidiary;
(b) the shares of any foreign Subsidiary of the Parent may be sold
to another foreign Subsidiary of the Parent that is wholly owned by the
Parent, except that all the outstanding shares of each Foreign Subsidiary
Borrower shall at all times be wholly owned directly or indirectly by the
Parent;
(c) the shares of any domestic Subsidiary of the Parent may be sold
to another domestic Subsidiary of the Parent that is wholly-owned by the
Parent and that is a Guarantor; and
(d) for Designated Sales (provided, however, that all the
outstanding shares of each Foreign Subsidiary Borrower shall at all times
be wholly owned directly or indirectly by the Parent);
or permit any such Subsidiary to issue any additional shares of its capital
stock, except directors' qualifying shares and except in connection with a
transaction permitted by (a), (b) or (c) above to the extent necessary to
effectuate such transaction.
Section 8.9. Transactions with Affiliates. Enter into any transaction,
including, without limitation, the purchase, sale or exchange of property or the
rendering of any service, with any Affiliate or permit any of its Subsidiaries
to enter into any transaction, including, without limitation, the purchase, sale
or exchange of property or the rendering of any service, with any Affiliate,
except in the ordinary course of and pursuant to the reasonable requirements of
the Parent's or such Subsidiary's business (including without limitation direct
and indirect promotional and advertising efforts of the Parent, consistent with
past practice) and upon fair and reasonable terms that are (except for loans and
advances permitted by clauses (h) and (j) of Section 8.5) no less favorable to
the Parent or such Subsidiary than would obtain in a comparable arm's length
transaction with a Person not an Affiliate.
52
Section 8.10. Mergers, Etc. Merge or consolidate with, or sell, assign,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to, any Person, or acquire all or substantially all of the
assets or of a line of business of any Person (or enter into any agreement to do
any of the foregoing), or permit any of its Subsidiaries to do so, except:
(a) for Acquisitions that are permitted pursuant to Section 8.11;
(b) sales of assets that are permitted pursuant to clauses (c) and
(d) of Section 8.7 and clauses (a) and (b) of Section 8.8; and
(c) for Designated Sales (provided, however, that all the
outstanding shares of each Foreign Subsidiary Borrower shall at all times
be wholly owned directly or indirectly by the Parent).
Section 8.11. Acquisitions. Make any Acquisition unless:
(i) no Default or Event of Default exists either immediately
prior to such Acquisition or after giving effect to such
Acquisition; and
(ii) such Acquisition is approved by the board of directors of
the corporation (if any) which is the subject of such Acquisition,
or is recommended by such board to the shareholders of such
corporation; and
(iii) if the principal business of the corporation or other
entity which is the subject of such Acquisition is not in the Core
Business, then the aggregate amount expended by the Parent or any
Subsidiary for such Acquisition, and for all other Acquisitions
where the principal business of the corporation or other entity
which is the subject thereof is not in the Core Business, is not
more than $20,000,000.
As used herein, the term "Acquisition" means any transaction pursuant to which
the Parent or any of its Subsidiaries (a) acquires equity securities (or
warrants, options or other rights to acquire such securities) of any corporation
or other entity other than the Parent or any corporation which is not then a
Subsidiary of the Parent, pursuant to a solicitation of tenders therefor, or in
one or more negotiated block, market or other transactions not involving a
tender offer, or a combination of any of the foregoing, or (b) makes any
corporation or other entity a Subsidiary of the Parent, or causes any such
corporation or other entity to be merged into the Parent or any of its
Subsidiaries, in any case pursuant to a merger, purchase of securities or of
assets or any reorganization providing for the delivery or issuance to the
holders of the then outstanding securities of such corporation or other entity,
in exchange for such securities, of cash or securities of the Parent or any of
its Subsidiaries, or a combination thereof, or (c) purchases all or
substantially all of the assets or of any line of business of any corporation or
other entity.
Section 8.12. No Material Change in Business. Make or permit any of its
Subsidiaries (other than an Inactive Subsidiary) to make a material change in
the nature of its business such that it is no longer primarily engaged in the
Core Business.
Section 8.13. No Restriction. Agree, or permit any of its Subsidiaries to
agree, to any restriction on the right of any Subsidiary to pay to the Parent
any dividends or repayments of loan advances.
Section 8.14. Swap and Exchange Agreements. Enter into, or permit any of
its Subsidiaries to enter into, any interest-rate swap, cap, floor, collar or
other similar agreement, or any foreign exchange contract, currency swap
agreement or other similar agreement, except for the purpose of hedging its risk
in the ordinary course of business.
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Section 8.15. Certain Subsidiary Liabilities. Permit any domestic
Subsidiary of the Parent that acquires ownership of any trademark, tradename,
tradedress or patent from the Parent or any other Subsidiary to be liable for
total liabilities in excess of $1,500,000, excluding liabilities to the Parent
or to any Subsidiary Guarantor and excluding its liability under its Subsidiary
Guarantee, except for the guaranties by the Subsidiary Guarantors of the
Prudential Existing Notes and Future Permitted Private Placement Debt.
ARTICLE 9. FINANCIAL COVENANTS.
So long as any of the Notes shall remain unpaid, or any Letter of Credit
shall remain outstanding, or any Lender shall have any Revolving Credit
Commitment under this Agreement:
Section 9.1. Tangible Net Worth. The Parent shall at all times from and
after the Closing Date maintain a Consolidated Tangible Net Worth of not less
than the sum of $165,000,000 plus the Incremental TNW Amount.
Section 9.2. Interest Coverage Ratio. The Parent shall maintain, as of the
last day of each fiscal quarter of the Parent (called, for purposes of this
Section, the "determination date"), an Interest Coverage Ratio for the period
consisting of such quarter and the three preceding fiscal quarters in excess of
3.5 to 1.0.
Section 9.3. Average Debt Coverage Ratio. The Parent shall not permit the
Average Debt Coverage Ratio as of the last day of any fiscal quarter for the
period of four consecutive fiscal quarters ending on such day to be more than
3.0 to 1.0.
Section 9.4. Capital Expenditures. The Parent shall not permit
Consolidated Capital Expenditures to exceed (on a noncumulative basis)
$20,000,000 during any fiscal year; furthermore, the Parent shall not permit
Consolidated Capital Expenditures to exceed $45,000,000 during the period from
February 1, 2003 through the Maturity Date.
ARTICLE 10. EVENTS OF DEFAULT.
Section 10.1. Events of Default. Any of the following events shall be an
"Event of Default":
(a) any Borrower shall: (i) fail to pay the principal of any of its
Notes as and when due and payable; or (ii) fail to pay interest on any of its
Notes or any fee or other amount due from it hereunder as and when due and
payable and such failure shall continue for three days;
(b) any representation or warranty made or deemed made by any
Borrower or a Guarantor in this Agreement or in any other Facility Document or
which is contained in any certificate, document, opinion, financial or other
statement furnished at any time under or in connection with any Facility
Document shall prove to have been incorrect in any material respect on or as of
the date made or deemed made;
(c) any Borrower shall: (i) fail to perform or observe any term,
covenant or agreement required to be performed or observed by it that is
contained in Section 2.15 or Section 3.12, or Articles 8 or 9; or (ii) fail to
perform or observe any term, covenant or agreement on its part to be performed
or observed (other than the obligations specifically referred to elsewhere in
this Section 10.1) in any Facility Document and (in the case of a failure
referred to in this clause (ii)), such failure shall continue for 30 consecutive
days;
(d) the Parent or any of its Subsidiaries shall: (i) fail to pay any
indebtedness, including but not limited to indebtedness for borrowed money
(other than the payment obligations
54
described in (a) above), of the Parent or such Subsidiary, as the case may be,
or any interest or premium thereon, when due (whether by installment, scheduled
maturity, required prepayment, acceleration, demand or otherwise); or (ii) fail
to perform or observe any term, covenant or condition on its part to be
performed or observed under any agreement or instrument relating to any such
indebtedness, when required to be performed or observed, if the effect of such
failure to perform or observe is to accelerate, or to permit the acceleration
of, after the giving of notice or passage of time, or both, the maturity of such
indebtedness, provided that (in the case of both (i) and (ii)) the aggregate
principal amount of such indebtedness as to which such failure to pay has
occurred (and not merely the installment or other portion thereof not paid), or
as to which the maturity is or is permitted to be accelerated by reason of such
failure to perform or observe, shall be $1,000,000 or more; or any such
indebtedness whose principal amount is $1,000,000 or more shall be declared to
be due and payable, or required to be prepaid (other than by a regularly
scheduled required prepayment), prior to the stated maturity thereof;
(e) the Parent or any of its Subsidiaries: (i) shall generally not,
or be unable to, or shall admit in writing its inability to, pay its debts as
such debts become due; or (ii) shall make an assignment for the benefit of
creditors, petition or apply to any tribunal for the appointment of a custodian,
receiver or trustee for it or a substantial part of its assets; or (iii) shall
commence any proceeding under any bankruptcy, reorganization, arrangement or
readjustment of debt law or statute, or (except in the case of an Inactive
Subsidiary) any dissolution or liquidation law or statute, of any jurisdiction
whether now or hereafter in effect; or (iv) shall have had any such petition or
application filed or any such proceeding shall have been commenced, against it,
in which an adjudication or appointment is made or order for relief is entered,
or which petition, application or proceeding remains undismissed or unstayed for
a period of 30 days or more; or shall be the subject of any proceeding under
which its assets may be subject to seizure, forfeiture or divestiture (other
than a proceeding in respect of a Lien permitted under Section 8.3 (a)); or (v)
by any act or omission shall indicate its consent to, approval of or
acquiescence in any such petition, application or proceeding or order for relief
or the appointment of a custodian, receiver or trustee for all or any
substantial part of its property; or (vi) shall suffer any such custodianship,
receivership or trusteeship to continue undischarged for a period of 30 days or
more;
(f) one or more judgments, decrees or orders for the payment of
money in excess of $1,000,000 in the aggregate shall be rendered against the
Parent or any of its Subsidiaries and such judgments, decrees or orders shall
continue unsatisfied and in effect for a period of 60 consecutive days without
being vacated, discharged, satisfied or stayed or bonded pending appeal;
(g) any event or condition shall occur or exist with respect to any
Plan or Multiemployer Plan concerning which the Parent is under an obligation to
furnish a report to the Lenders in accordance with Section 7.8(h) hereof and as
a result of such event or condition, together with all other such events or
conditions, the Parent or any ERISA Affiliate has incurred or in the opinion of
the Required Lenders is reasonably likely to incur a liability to a Plan, a
Multiemployer Plan, the PBGC, or a Section 4042 Trustee (or any combination of
the foregoing) which is material in relation to the financial position of the
Parent and its Subsidiaries, on a consolidated basis;
(h) the Unfunded Benefit Liabilities of one or more Plans have
increased after the date of this Agreement in an amount which is material;
(i) if at any time the capital stock of the Parent owned by the
Xxxxxxxx Group represents less than 25% of the voting power of (x) all
outstanding capital stock of the Parent and (y) all outstanding securities and
rights that are then convertible into or exchangeable for capital stock of the
Parent or upon the exercise of which capital stock of the Parent will be issued
in respect of such securities or rights;
(j) there is a seizure by or forfeiture in favor of any Governmental
Authority of any property of the Parent or any of its Subsidiaries having a
value in excess of $1,000,000, other than (i) by an eminent domain proceeding
where the Parent or such Subsidiary receives reasonable compensation therefor;
or (ii) if such seizure or forfeiture does not have a material adverse effect on
the financial
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condition, business or operations of the Parent and its Subsidiaries taken as a
whole or on the ability of any Borrower to perform any of its obligations under
any Facility Document; or
(k) any Guarantee shall at any time after its execution and delivery
and for any reason cease to be in full force and effect (except as permitted by
Section 12.1(a)(viii)) or shall be declared null and void, or the validity or
enforceability thereof shall be contested by the Guarantor thereunder, or such
Guarantor shall deny it has any further liability or obligation thereunder or
shall fail to perform its obligations thereunder.
Section 10.2. Remedies. If any Event of Default shall occur and be
continuing, the Administrative Agent may or, upon request of the Required
Lenders, shall by notice to the Parent (on behalf of itself and the Foreign
Subsidiary Borrowers), do any or all of the following: (a) declare the Revolving
Credit Commitments to be terminated, whereupon the same shall forthwith
terminate; (b) declare the outstanding principal of the Notes, all interest
thereon and all other amounts payable under this Agreement or the Notes to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by each Borrower (provided that, in the case of an Event of Default
referred to in Section 10.1(e) as to any Borrower, the Revolving Credit
Commitments shall be immediately terminated, and the Notes, all interest thereon
and all other amounts payable under this Agreement shall be immediately due and
payable without any notice and without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by each
Borrower); and (c) direct the Parent immediately to pay (and the Parent agrees
that upon receipt of such a notice, or upon the occurrence of an Event of
Default referred to in Section 10.1(e) as to any Borrower, the Parent will
immediately pay) to the Administrative Agent such additional amount of cash as
is equal to the L/C Exposure to the extent not already secured by cash
collateral under Section 2.13, to be held by the Administrative Agent in the
Cash Collateral Account as security for the Parent's reimbursement obligation in
respect of Letters of Credit.
ARTICLE 11. THE ADMINISTRATIVE AGENT; RELATIONS AMONG LENDERS AND PARENT.
Section 11.1. Appointment, Powers and Immunities of Administrative Agent.
Each Lender (in its capacity as Lender and, as applicable, Swingline Bank and
Issuing Bank) hereby irrevocably (but subject to removal by the Required Lenders
pursuant to Section 11.9) appoints and authorizes the Administrative Agent to
act as its agent hereunder and under any other Facility Document with such
powers as are specifically delegated to the Administrative Agent by the terms of
this Agreement and any other Facility Document, together with such other powers
as are reasonably incidental thereto. The Administrative Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement
and any other Facility Document, and shall not by reason of this Agreement be a
trustee for any Lender. The Administrative Agent shall not be responsible to the
Lenders for any recitals, statements, representations or warranties made by any
Borrower or any officer or official of any Borrower or any other Person
contained in this Agreement or any other Facility Document, or in any
certificate or other document or instrument referred to or provided for in, or
received by any of them under, this Agreement or any other Facility Document, or
for the value, legality, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Facility Document or any other
document or instrument referred to or provided for herein or therein, for the
perfection or priority of any collateral security for the Loans or the
reimbursement obligations in respect of Letters of Credit or for any failure by
any Borrower to perform any of its obligations hereunder or thereunder. The
Administrative Agent may employ agents and attorneys-in-fact and shall not be
responsible, except as to money or securities received by it or its authorized
agents, for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. Neither the Administrative Agent nor any of
its directors, officers, employees or agents shall be liable or responsible for
any action taken or omitted to be taken by it or them hereunder or under any
other Facility Document or in connection herewith or therewith, except for its
or their own gross negligence or willful misconduct. The Parent shall pay any
fee agreed to by the Parent and the Administrative Agent with respect to the
Administrative Agent's services hereunder.
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Section 11.2. Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telex, telegram or cable) believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat each Lender as the holder of the
Loans made by it and its participations in Letters of Credit for all purposes
hereof unless and until an Assignment and Assumption Agreement shall have been
furnished to the Administrative Agent in accordance with Section 12.5, but the
Administrative Agent shall not be required to deal with any Person who has
acquired a participation in any Loan or any such participation from a Lender. As
to any matters not expressly provided for by this Agreement or any other
Facility Document, the Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, hereunder in accordance with
instructions signed by the Required Lenders, and such instructions of the
Required Lenders and any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders and any other holder of all or any portion of
any Loan or any such participation.
Section 11.3. Defaults. The Administrative Agent shall not be deemed to
have knowledge of the occurrence of a Default or Event of Default (other than
the non-payment of principal of or interest on the Loans to the extent the same
is required to be paid to the Administrative Agent for the account of the
Lenders) unless the Administrative Agent has received notice from a Lender or a
Borrower specifying such Default or Event of Default and stating that such
notice is a "Notice of Default." In the event that the Administrative Agent
receives such a notice of the occurrence of a Default or Event of Default, the
Administrative Agent shall give prompt notice thereof to the Lenders (and shall
give each Lender prompt notice of each such non-payment). The Administrative
Agent shall (subject to Section 11.8 and Section 12.1(a)) take such action with
respect to such Default or Event of Default which is continuing as shall be
directed by the Required Lenders; provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may take such action, or refrain from taking such action, with respect to
such Default or Event of Default as it shall deem advisable in the best interest
of the Lenders; and provided further that the Administrative Agent shall not be
required to take any such action which it determines to be contrary to law.
Section 11.4. Rights of Administrative Agent as a Lender. With respect to
its Revolving Credit Commitment and the Loans made by it and the Letters of
Credit, the entity which is the Administrative Agent in its capacity as a Lender
hereunder shall have the same rights and powers hereunder as any other Lender
and may exercise the same as though it were not acting as the Administrative
Agent, and the term "Lender" or "Lenders" shall, unless the context otherwise
indicates, include the entity which is the Administrative Agent in its capacity
as a Lender. The entity which is the Administrative Agent and its Affiliates may
(without having to account therefor to any Lender) accept deposits from, lend
money to (on a secured or unsecured basis), and generally engage in any kind of
banking, trust or other business with, the Parent (and any of its Affiliates) as
if it were not acting as the Administrative Agent, and the entity which is the
Administrative Agent may accept fees and other consideration from any Borrower
for services in connection with this Agreement or otherwise without having to
account for the same to the Lenders. Although the Administrative Agent and its
Affiliates may in the course of such relationships and relationships with other
Persons acquire information about the Parent, its Affiliates and such other
Persons, the Administrative Agent shall have no duty to disclose such
information to the Lenders.
Section 11.5. Indemnification of Administrative Agent. The Lenders agree
to indemnify the Administrative Agent (to the extent not reimbursed under
Section 12.3 or under the applicable provisions of any other Facility Document,
but without limiting the obligations of the Borrowers under Section 12.3 or such
provisions), ratably in accordance with their respective Pro Rata Percentages,
for any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement,
any other Facility Document or any other documents contemplated by or referred
to herein or the transactions contemplated hereby or thereby (including, without
limitation, the costs and expenses which any Borrower is obligated to pay under
Section 12.3 or under the applicable provisions of any other Facility Document
57
but excluding, unless a Default or Event of Default has occurred, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof or thereof or of
any such other documents or instruments; provided that no Lender shall be liable
for any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the party to be indemnified.
Section 11.6. Documents. The Administrative Agent will forward to each
Lender, promptly after the Administrative Agent's receipt thereof, a copy of
each report, notice or other document required by this Agreement or any other
Facility Document to be delivered to the Administrative Agent for such Lender.
Section 11.7. Non-Reliance on Administrative Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Parent and its Subsidiaries and decision to enter into this Agreement and 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 deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any other Facility Document.
The Administrative Agent shall not be required to keep itself informed as to the
performance or observance by any Borrower of this Agreement or any other
Facility Document or any other document referred to or provided for herein or
therein or to inspect the properties or books of the Parent or any Subsidiary.
Except for notices, reports and other documents and information expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the affairs,
financial condition or business of the Parent or any Subsidiary (or any of their
Affiliates) which may come into the possession of the Administrative Agent or
any of its Affiliates. The Administrative Agent shall not be required to file
this Agreement, any other Facility Document or any document or instrument
referred to herein or therein, for record or give notice of this Agreement, any
other Facility Document or any document or instrument referred to herein or
therein, to anyone.
Section 11.8. Failure of Administrative Agent to Act. Except for action
expressly required of the Administrative Agent hereunder, the Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances (which may include
cash collateral) of the indemnification obligations of the Lenders under Section
11.5 in respect of any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action.
Section 11.9. Resignation or Removal of Administrative Agent. Subject to
the appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving written notice
thereof to the Lenders and the Parent (on behalf of itself and the Foreign
Subsidiary Borrowers), and the Administrative Agent may be removed at any time
for cause by Lenders having Syndicated Loans outstanding, L/C Exposure and
unused Revolving Credit Commitments representing at least 66?% of the sum of all
Syndicated Loans outstanding, L/C Exposure and unused Revolving Credit
Commitments; provided that the Parent and the other Lenders shall be promptly
notified thereof. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Administrative Agent, subject
(unless an Event of Default exists) to the approval of the Parent, which
approval shall not be unreasonably withheld. If no successor Administrative
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative
Agent's giving of notice of resignation or the Required Lenders' removal of the
retiring Administrative Agent, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, subject (unless
an Event of Default exists) to the approval of the Parent, which approval shall
not be unreasonably withheld, which shall be a Lender or (if no Lender accepts
the appointment) a bank which has an office in New York, New York. The Required
Lenders or the retiring Administrative Agent, as the case may be, shall upon the
appointment of a successor Administrative Agent promptly so notify the Parent
(on behalf of itself and the Foreign Subsidiary Borrowers) and the other
Lenders. Upon the acceptance of any appointment as Administrative Agent
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hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon 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. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Article 11 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent.
Section 11.10. Amendments Concerning Agency Function. The Administrative
Agent shall not be bound by any waiver, amendment, supplement or modification of
this Agreement or any other Facility Document which affects its duties hereunder
or thereunder unless it shall have given its prior consent thereto.
Section 11.11. Liability of Administrative Agent. The Administrative Agent
shall not have any liabilities or responsibilities to any Borrower on account of
the failure of any Lender to perform its obligations hereunder or to any Lender
on account of the failure of any Borrower to perform its obligations hereunder
or under any other Facility Document.
Section 11.12. Delegation of Agency Functions. The Administrative Agent
may perform any and all its duties and exercise any or all of 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 any and all of its rights and powers through their
respective Affiliates. The exculpatory provisions as to the Administrative Agent
contained in this Article shall apply to any such sub-agent and to the
Affiliates of the Administrative Agent and any such sub-agent.
Section 11.13. Non-Receipt of Funds by the Administrative Agent. Unless
the Administrative Agent shall have been notified by a Lender or a Borrower
(either one as appropriate being the "Payor") (or by the Parent on behalf of a
Foreign Subsidiary Borrower) prior to the date on which such Lender is to make
payment hereunder to the Administrative Agent of the proceeds of a Loan or such
Borrower is to make payment to the Administrative Agent, as the case may be
(either such payment being a "Required Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient on such date and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient of such payment
(and, if such recipient is a Borrower and the Payor Lender fails to pay the
amount thereof to the Administrative Agent forthwith upon demand, such Borrower)
shall, on demand, repay to the Administrative Agent the amount made available to
it together with interest thereon for the period from the date such amount was
so made available by the Administrative Agent until the date the Administrative
Agent recovers such amount at a rate per annum equal to (i) in the case of a
Borrower, the interest rate applicable at such time to the applicable Loan, and
(ii) in the case of such Lender, a rate determined by the Administrative Agent
to represent its cost of overnight or short-term funds in the relevant currency
(which determination shall be conclusive absent manifest error). If a Lender
makes a Required Payment to the Administrative Agent pursuant to the immediately
preceding sentence and a Borrower shall have repaid such amount to the
Administrative Agent pursuant to such sentence, the Administrative Agent shall
promptly return to such Borrower any amount (including interest) paid by such
Borrower to the Administrative Agent pursuant to such sentence.
Section 11.14. Withholding Taxes. Each Lender represents to the
Administrative Agent and the Parent that it is entitled to receive any payments
to be made to it hereunder without the withholding of any tax imposed by the
United States of America and will furnish to the Administrative Agent such
forms, certifications, statements and other documents as the Administrative
Agent may request from time to time to evidence such Lender's exemption from the
withholding of any tax imposed by any jurisdiction or to enable the
Administrative Agent to comply with any applicable laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Lender is not
created or organized under the laws of the United States of America or any state
thereof, in the event that the payment of interest by any Borrower is treated
for U.S. income tax purposes as derived in whole or in part from sources from
within the U.S.,
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such Lender will furnish to the Administrative Agent Form W-8EC1 or Form W-8BEN
of the Internal Revenue Service, or such other forms, certifications, statements
or documents, duly executed and completed by such Lender as evidence of such
Lender's exemption from the withholding of U.S. tax with respect thereto. The
Administrative Agent shall not be obligated to make any payments hereunder to
such Lender in respect of any Loan or reimbursement of a drawing under a Letter
of Credit or such Lender's Revolving Credit Commitment until such Lender shall
have furnished to the Administrative Agent the requested form, certification,
statement or document.
Section 11.15. Several Obligations and Rights of Lenders. The failure of
any Lender to make any Loan to be made by it on the date specified therefor
shall not relieve any other Lender of its obligation to make its Loan on such
date, but no Lender shall be responsible for the failure of any other Lender to
make a Loan to be made by such other Lender. No Lender shall be responsible for
any failure of the Swingline Bank to make a Swingline Loan required to be made
hereunder, or for any failure of the Issuing Bank to issue a Letter of Credit
required to be issued hereunder. The amounts payable at any time hereunder to
each Lender, the Swingline Bank and the Issuing Bank shall be a separate and
independent debt, and each of them shall be entitled to protect and enforce its
rights arising out of this Agreement, and it shall not be necessary for any
other of them to be joined as an additional party in any proceeding for such
purpose.
Section 11.16. Pro Rata Treatment of Syndicated Loans, Etc. Except to the
extent otherwise expressly provided: (a) each Borrowing of Loans pursuant to
Section 2.1 shall be made from the Lenders, each reduction or termination of the
amount of the Revolving Credit Commitments under Section 2.10 shall be applied
to the Revolving Credit Commitments, and each payment of Commitment Fees
accruing under Section 2.7 shall be made for the account of the Lenders, pro
rata according to the amounts of their respective unused Revolving Credit
Commitments; (b) each conversion under Section 2.11 of Syndicated Loans of a
particular Type (but not conversions provided for by Article 4), shall be made
pro rata among the Lenders holding Syndicated Loans of such Type according to
the respective principal amounts of such Syndicated Loans by such Lenders; (c)
each prepayment and payment of principal of or interest on Syndicated Loans of a
particular Type and a particular Interest Period shall be made to the
Administrative Agent for the account of the Lenders holding Syndicated Loans of
such Type and Interest Period pro rata in accordance with the respective unpaid
principal amounts of such Syndicated Loans of such Interest Period held by such
Lenders; and (d) each payment of L/C Participation Fees accruing under Section
3.9 shall be made for the account of the Lenders, pro rata according to their
respective Pro Rata Percentages of the average daily aggregate L/C Exposure
(excluding the portion thereof attributable to unreimbursed L/C Disbursements).
Section 11.17. Sharing of Payments Among Lenders. If a Lender shall obtain
payment of any principal of or interest on any Syndicated Loan made by it, or of
any reimbursement obligation of the Parent as to Letters of Credit, through the
exercise of any right of setoff, banker's lien, counterclaim, or by any other
means it shall promptly purchase from the other Lenders participations in (or,
if and to the extent specified by such Lender, direct interests in) the Loans
made by the other Lenders and Letters of Credit in such amounts, and make such
other adjustments from time to time as shall be equitable to the end that all
the Lenders shall share the benefit of such payment (net of any expenses which
may be incurred by such Lender in obtaining or preserving such benefit) pro rata
in accordance with the unpaid principal and interest on the Loans and Letter of
Credit participations held by each of them. To such end the Lenders shall make
appropriate adjustments among themselves (by the resale of participations sold
or otherwise) if such payment is rescinded or must otherwise be restored. Each
Borrower agrees that any Lender so purchasing a participation (or direct
interest) in the Loans made by other Lenders or Letters of Credit may exercise
all rights of setoff, banker's lien, counterclaim or similar rights with respect
to such participation (or direct interest). Nothing contained herein shall
require any Lender to exercise any such right or shall affect the right of any
Lender to exercise, and retain the benefits of exercising, any such right with
respect to any other indebtedness of any Borrower.
Section 11.18. Syndication Agent and Documentation Agent. Each of the
Lenders identified on the cover page of this Agreement as the Syndication Agent
and the Documentation Agent shall have, as such, only such powers and duties as
may be hereafter delegated to it by the Administrative Agent (with
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the written approval of the Parent and all the Lenders) and accepted by such
Syndication Agent or such Documentation Agent (as the case may be), and no other
powers or duties. With respect to each function undertaken by it pursuant to any
power or duty so delegated, such Syndication Agent or such Documentation Agent
(as the case may be) shall enjoy all the benefits and protections conferred on
the Administrative Agent in this Article 11 and elsewhere in this Agreement
(including, without limitation, all immunities, indemnifications, rights and
other protective provisions) with the same effect as if such Syndication Agent
or such Documentation Agent (as the case may be) were included in the definition
of "Administrative Agent". Each of such Syndication Agent and such Documentation
Agent may resign at any time by giving written notice thereof to the Lenders and
the Parent, and each of such Administrative Agent and such Documentation Agent
may be removed at any time with or without cause by the Required Lenders.
Neither such Syndication Agent nor such Documentation Agent shall be entitled to
any agency fee for serving as the Syndication Agent or the Documentation Agent
(as the case may be) hereunder, except as may be hereafter agreed to in a
separate written agreement between the Parent and such Syndication Agent or such
Documentation Agent (as the case may be) (and no such agreement shall reduce the
amount of the agency fee payable to the Administrative Agent or require the
Administrative Agent to share such fee with such Syndication Agent or such
Documentation Agent (as the case may be).
ARTICLE 12. MISCELLANEOUS.
Section 12.1. Amendments and Waivers; Remedies Cumulative.(a) (a) Except
as otherwise expressly provided in this Agreement, any provision of this
Agreement may be amended or modified only by an instrument in writing signed by
the Borrowers (or by the Parent, on behalf of itself and the Foreign Subsidiary
Borrowers), the Administrative Agent and the Required Lenders, or by the
Borrowers (or by the Parent, on behalf of itself and the Foreign Subsidiary
Borrowers), and the Administrative Agent acting with the consent of the Required
Lenders, and any provision of this Agreement may be waived by the Required
Lenders or by the Administrative Agent acting with the consent of the Required
Lenders; provided that no amendment, modification or waiver shall, unless by an
instrument signed by all of the Lenders or by the Administrative Agent acting
with the consent of all of the Lenders: (i) increase or extend the term, or
extend the time for the reduction or termination, of the Revolving Credit
Commitments (except that, for the avoidance of doubt, the Revolving Credit
Commitments may be increased pursuant to Section 2.16 without the approval or
consent of any Lender other than each relevant Increasing Lender or Augmenting
Lender referred to in Section 2.16), (ii) extend the date fixed for the payment
of principal of or interest on any Loan or any fees payable hereunder, (iii)
reduce the amount of any payment of principal thereof or the rate at which
interest is payable thereon or any fee payable hereunder, (iv) alter the terms
of this Section 12.1 or any other provision hereof specifying that the approval
of all Lenders is required (including such provisions contained in the first
sentence of Section 11.18 and in Section 12.5(a)), (v) amend the definition of
the term "Required Lenders", (vi) waive the condition precedent set forth in
Section 5.2(b), (vii) release collateral in any material amount, (viii) release
guarantees in any material amount (provided that the Administrative Agent shall
release, without the consent of any Lenders, any Guarantee of a Subsidiary all
of whose stock (or substantially all of whose stock) is sold to a Person other
than another Subsidiary in a sale that is otherwise permitted by this
Agreement), (ix) permit any Liens not permitted by Section 8.3, (x) change the
several nature of the obligations of the Lenders under this Agreement, (xi)
increase the $10,000,000 maximum aggregate limitation on Swingline Loans, or the
$15,000,000 maximum aggregate limitation on the L/C Exposure, or the Foreign
Currency Sublimit Dollar Amount (except that, for the avoidance of doubt, the
Foreign Currency Sublimit Dollar Amount shall be increased pursuant to Section
2.16 automatically if the Total Revolving Credit Commitment is increased
pursuant to Section 2.16), (xii) add any further Person (beyond the Borrowers)
as a Person that may borrow from the Lenders under this Agreement, (xiii) add
any currency (beyond dollars and the Foreign Currencies) as a currency in which
Syndicated Loans may be made under this Agreement, or (xiv) permit the
expiration date of any Letter of Credit to be after the Maturity Date; and
provided, further, that no amendment, modification or waiver shall, unless in an
instrument signed by Lenders whose aggregate Pro Rata Percentages equal or
exceed 66?% or by the Administrative Agent acting with the consent of such
Lenders, waive any requirement set forth in Section 2.10 or Section 8.1(i) for
the reduction or termination of the Revolving Credit Commitments (it being
agreed however that any extension of the fixed time for any such termination is
governed by clause (i) of the immediately preceding
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proviso); and provided, further that any amendment of Article 11 hereof or any
amendment which increases the obligations of the Administrative Agent hereunder
shall require the consent of the Administrative Agent; and provided further that
any amendment which increases the obligations of the Swingline Bank hereunder
shall require the consent of the Swingline Bank; and provided further that any
amendment which increases the obligations of the Issuing Bank hereunder shall
require the consent of the Issuing Bank.
(b) No failure or delay by the Administrative Agent, the Issuing Bank, the
Swingline 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, the Swingline 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 any Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (a) of this Section,
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, amendment, renewal or extension of
a Letter of Credit shall not be construed as a waiver of any Default or Event of
Default, regardless of whether the Administrative Agent, any Lender, the
Swingline Bank or the Issuing Bank may have had notice or knowledge of such
Default or Event of Default at the time.
Section 12.2. Usury. Anything herein to the contrary notwithstanding, the
obligations of each Borrower under this Agreement and the Notes shall be subject
to the limitation that payments of interest shall not be required to the extent
that receipt thereof would be contrary to provisions of law applicable to a
Lender limiting rates of interest which may be charged or collected by such
Lender.
Section 12.3. Expenses; Indemnity; Damage Waiver.(a) (a) The Parent and
(subject to the limitation contained in the sentence next following) each
Foreign Subsidiary Borrower shall pay (i) all reasonable out-of-pocket expenses
incurred by the Administrative Agent, including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent, in connection with the
syndication of the credit facility provided for herein, the preparation and
administration of this Agreement or any amendments, modifications or waivers of
the provisions hereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by the Issuing Bank in connection with the issuance, amendment, renewal
or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all reasonable out-of-pocket expenses incurred by the Administrative
Agent, the Issuing Bank, the Swingline Bank or any Lender, including the fees,
charges and disbursements of any counsel for the Administrative Agent, the
Issuing Bank, the Swingline Bank or any Lender, in connection with the
enforcement or protection of its rights in connection with this Agreement,
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 during any workout, restructuring or negotiations in respect of such
Loans or Letters of Credit. The liability of each Foreign Subsidiary Borrower
under this subsection (a) shall be limited to such out-of-pocket expenses that
(x) relate to such Foreign Subsidiary Borrower or to the Loans made to such
Foreign Subsidiary Borrower or to the obligations incurred by such Foreign
Subsidiary Borrower under this Agreement or under any other Facility Document to
which such Foreign Subsidiary Borrower is a party, or (y) arise as a result of
such Foreign Subsidiary Borrower being a party to this Agreement or to another
Facility Document.
(b) The Parent and (subject to the limitation contained in the
sentence next following) each Foreign Subsidiary Borrower shall indemnify the
Administrative Agent, the Issuing Bank, the Swingline Bank and each Lender, and
each Affiliate of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and hold each Indemnitee harmless from, any and all
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, or as a result of (i) the use of proceeds of a Loan or Letter of Credit,
(ii) any
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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), (iii) any actual or alleged
presence or release of Hazardous Materials on or from any property owned or
operated by the Parent or any of its Subsidiaries, or any environmental
liability related in any way to the Parent or any of its Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing or to the execution or delivery of this
Agreement or any other Facility Document or any agreement or instrument
contemplated hereby or thereby or to the performance by the parties hereto or
thereto of their respective obligations hereunder or thereunder or to the
consummation of the transactions contemplated hereby or thereby or to any Loan
or Letter of Credit, whether the same is based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee. The liability of each Foreign Subsidiary Borrower under this
subsection (b) shall be limited to such losses, claims, damages, liabilities and
related expenses that (x) relate to such Foreign Subsidiary Borrower or to the
Loans made to such Foreign Subsidiary Borrower or to the obligations incurred by
such Foreign Subsidiary Borrower under this Agreement or under any other
Facility Document to which such Foreign Subsidiary Borrower is a party, or (y)
arise as a result of such Foreign Subsidiary Borrower being a party to this
Agreement or to another Facility Document.
(c) To the extent that the Borrowers fail to pay any amount required
to be paid to the Administrative Agent, the Issuing Bank or the Swingline Bank
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Administrative Agent, the Issuing Bank or the Swingline Bank, as the case
may be, such Lender's Pro Rata Percentage (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount; 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 the Swingline
Bank in its capacity as such.
(d) To the extent permitted by applicable law, no Borrower shall
assert, and each Borrower 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, any other Facility Document or any
agreement or instrument contemplated hereby or thereby, any Loan or Letter of
Credit or the use of the proceeds thereof.
Section 12.4. Survival. The obligations of the Borrowers under Article 4
and Section 12.3 shall survive the repayment of the Loans and the expiration of
the Letters of Credit and the termination of the Revolving Credit Commitments.
Section 12.5. Assignment; Participations.(a) (a) This Agreement shall be
binding upon, and shall inure to the benefit of, the Borrowers, the
Administrative Agent, the Lenders, the Swingline Bank, the Issuing Bank and
their respective successors and assigns, except that no Borrower may assign or
transfer its rights or obligations hereunder without the written approval of all
the Lenders (and any attempted such assignment or transfer without such consent
shall be null and void).
(b) After first obtaining the approval of the Administrative Agent,
the Swingline Bank, the Issuing Bank and (provided no Event of Default exists as
a result of the commencement of a case with respect to the Parent under the
Federal Bankruptcy Code or as a result of the commencement of a bankruptcy,
insolvency, reorganization, receivership or similar proceeding with respect to
either Foreign Subsidiary Borrower under Swiss or other foreign law) the Parent,
which approval will not be unreasonably withheld, each Lender may assign to one
or more banks, finance companies, insurance or other financial institutions all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Revolving Credit Commitment and the Syndicated Loans owing
to it and its participations in Letters of Credit and in Swingline Loans);
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of the assigning Lender's rights and obligations under
this Agreement and the assignment shall cover the same percentage of such
Lender's
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Revolving Credit Commitment and Syndicated Loans and participations in Letters
of Credit and in Swingline Loans; (ii) unless the Administrative Agent and the
Parent otherwise consent or all the assigning Lender's Revolving Credit
Commitment is being assigned to an assignee, the amount of the Revolving Credit
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the effective date of the Assignment and Assumption
Agreement with respect to such assignment) shall in no event be less than Five
Million Dollars ($5,000,000) and shall be an integral multiple of One Million
Dollars ($1,000,000); (iii) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its approval and acceptance, an
Assignment and Assumption Agreement in substantially the form attached hereto as
Exhibit E with such changes therein (if any) as the Administrative Agent may
approve (the "Assignment and Assumption Agreement"); and (iv) the Administrative
Agent shall receive from the assignor (or, in the case of an assignment pursuant
to Section 4.7, from the Parent) a processing fee of Five Thousand Dollars
($5,000). Without restricting the right of the Administrative Agent, the
Swingline Bank, the Issuing Bank or (provided no Event of Default exists as a
result of the commencement of a case with respect to the Parent under the
Federal Bankruptcy Code or as a result of the commencement of a bankruptcy,
insolvency, reorganization, receivership or similar proceeding with respect to
either Foreign Subsidiary Borrower under Swiss or other foreign law) the Parent
to reasonably object to any bank, finance company, insurance or other financial
institution becoming an assignee of an interest of a Lender hereunder, each
proposed assignee must be an existing Lender or a bank, finance company,
insurance or other financial institution which (i) has (or, in the case of a
bank which is a subsidiary, such bank's parent has) a rating of its senior
unsecured debt obligations of not less than Baa-1 by Xxxxx'x Investors Service,
Inc. or a comparable rating by a rating agency acceptable to the Administrative
Agent and (ii) has total assets in excess of Ten Billion Dollars
($10,000,000,000). Upon such execution, delivery, approval and acceptance, and
on the effective date specified in the applicable Assignment and Assumption
Agreement, (a) the assignee thereunder shall become a party hereto and a
"Lender" for purposes hereof and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment and Assumption
Agreement, shall have the rights and obligations of a Lender hereunder and (b)
the Lender-assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Assumption
Agreement, relinquish its rights (except under Article 4 and Section 12.3 in
respect of the period prior to the effective date of such Assignment and
Assumption) and be released from its obligations under this Agreement.
(c) By executing and delivering an Assignment and Assumption
Agreement, the Lender-assignor thereunder and the assignee thereunder confirm to
and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Assumption Agreement, such assigning
Lender makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or any other Facility Document or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or any other Facility Document or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Parent or any Subsidiary or the performance or observance by the Parent
or any Subsidiary of any of their respective obligations under any Facility
Document or any other instrument or document furnished pursuant hereto; (iii)
such assignee confirms that it has received a copy of this Agreement, together
with copies of the most recent financial statements referred to in Section
7.8(a) and (b) and such other Facility Documents and other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption Agreement; (iv) such
assignee will, independently and without reliance upon the Administrative Agent,
such assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (v) such
assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement and the
other Facility Documents as are delegated to the Administrative Agent by the
terms hereof and thereof, together with such powers as are reasonably incidental
thereto; and (vi) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.
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(d) The Administrative Agent shall maintain a copy of each
Assignment and Assumption Agreement delivered to and accepted by it and shall
record the names and addresses of each Lender and the Revolving Credit
Commitment of, and principal amount of the Syndicated Loans owing to, and the
amount of participations in Letters of Credit and in Swingline Loans of, such
Lender from time to time. Each Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is so recorded as a Lender hereunder
for all purposes of this Agreement. Such record shall be available for
inspection by each Borrower and each Lender.
(e) Upon its receipt of an Assignment and Assumption Agreement
executed by an assigning Lender and an assignee and consented to by the Parent
(except that no such consent of the Parent shall be required if an Event of
Default exists as a result of the commencement of a case with respect to the
Parent under the Federal Bankruptcy Code or as a result of the commencement of a
bankruptcy, insolvency, reorganization, receivership or similar proceeding with
respect to either Foreign Subsidiary Borrower under Swiss or other foreign law),
the Swingline Bank and the Issuing Bank, the Administrative Agent shall, if such
Assignment and Assumption Agreement has been properly completed and is in
substantially the form of Exhibit E, (i) accept such Assignment and Assumption
Agreement, (ii) record the information contained therein and (iii) give prompt
notice thereof to the Parent (on behalf of itself and the Foreign Subsidiary
Borrowers) and the Lenders. Upon request, each Borrower shall execute and
deliver to the Administrative Agent appropriate promissory notes in favor of
each assignee evidencing such assignee's Pro Rata Percentage of the Total
Revolving Credit Commitment. If the Lender-assignor shall have assigned its
entire Revolving Credit Commitment and Syndicated Loans, the original promissory
notes evidencing such Revolving Credit Commitment and Syndicated Loans shall be
cancelled and returned to the Parent (on behalf of itself or the applicable
Foreign Subsidiary Borrower).
(f) Each Lender may sell participations to one or more banks,
finance companies, insurance or other financial institutions in or to all or a
portion of its rights and obligations under this Agreement (including without
limitation all or a portion of its Revolving Credit Commitment and the
Syndicated Loans owing to it); provided, however, that (i) such Lender's
obligations under this Agreement (including without limitation its Revolving
Credit Commitment and its participations in Letters of Credit) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such participant shall
have no rights under any of the Facility Documents, (iv) each Borrower, the
Administrative Agent 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 and with regard to any and all payments to be
made under this Agreement and its Notes, and (v) the agreement executed by such
Lender in favor of the participant shall not give the participant the right to
require such Lender to take or omit to take any action hereunder except action
directly relating to (i) the extension of a payment date with respect to any
portion of the principal of or interest on any amount outstanding hereunder
allocated to such participant, (ii) the reduction of the principal amount
outstanding hereunder allocated to such participant or (iii) the reduction of
the rate of interest payable on such amount or any amount of fees payable
hereunder to a rate or amount, as the case may be, below that which the
participant is entitled to receive under its agreement with such Lender.
(g) Each Borrower will use reasonable efforts to cooperate with the
Administrative Agent and Lenders in connection with the assignment of interests
under this Agreement or the sale of participations herein.
(h) No Lender shall be permitted to assign or sell all or any
portion of its rights and obligations under this Agreement to the Parent or any
Affiliate of the Parent.
(i) Any Lender that proposes to sell any assignment or participation
hereunder may furnish any information concerning the Parent and its Affiliates
in the possession of such Lender from time to time to assignees and participants
(including prospective assignees and participants); provided that such Lender
shall require any such prospective assignee or such participant (prospective or
otherwise) to agree in writing to maintain the confidentiality of such
information, as provided in Section 12.14.
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(j) In addition to the assignments and participations permitted
under the foregoing provisions of this Section, any Lender may (without any need
to comply with any of the formal or procedural requirements of this Section)
assign and pledge all or any portion of its Revolving Credit Commitment and
Loans to (i) any Affiliate of such Lender or (ii) any Federal Reserve Bank as
collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank. No such assignment shall release the assigning Lender from its obligations
hereunder.
Section 12.6. Notices.(a) (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, to a party to this
Agreement at its address set forth beneath its signature line below.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Article 2 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or any
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications 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 date of receipt.
Section 12.7. Setoff. Each Borrower agrees that, in addition to (and
without limitation of) any right of setoff, banker's lien or counterclaim a
Lender may otherwise have, each Lender shall be entitled, at its option, to
offset balances (general or special, time or demand, provisional or final) held
by it for the account of such Borrower at any of such Lender's offices, in
dollars or in any other currency, against any amount payable by such Borrower to
such Lender under this Agreement or such Lender's Note which is not paid when
due (regardless of whether such balances are then due to such Borrower), in
which case it shall promptly notify such Borrower (or the Parent, on behalf of a
Foreign Subsidiary Borrower) and the Administrative Agent thereof; provided that
such Lender's failure to give such notice shall not affect the validity thereof
or place such Lender under any liability to such Borrower. Payments by each
Parent hereunder shall be made without setoff or counterclaim.
SECTION 12.8. JURISDICTION; JURY WAIVER; IMMUNITIES.(a) EACH BORROWER
HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE OR UNITED
STATES FEDERAL COURT SITTING IN NEW YORK COUNTY OVER ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE NOTES OR ANY OTHER FACILITY
DOCUMENT OR ANY LETTER OF CREDIT, AND EACH BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE OR FEDERAL COURT. EACH BORROWER IRREVOCABLY
CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING
BY THE MAILING OF COPIES OF SUCH PROCESS TO SUCH BORROWER AT THE ADDRESS FOR IT
SPECIFIED IN SECTION 12.6. EACH BORROWER 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.
EACH BORROWER FURTHER WAIVES ANY OBJECTION TO VENUE IN SUCH STATE AND ANY
OBJECTION TO AN ACTION OR PROCEEDING IN SUCH STATE ON THE BASIS OF FORUM NON
CONVENIENS. EACH BORROWER FURTHER AGREES THAT ANY ACTION OR PROCEEDING BROUGHT
AGAINST THE ADMINISTRATIVE AGENT SHALL BE BROUGHT ONLY IN NEW YORK STATE OR
UNITED STATES FEDERAL COURT SITTING IN NEW YORK COUNTY.
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(b) Furthermore, each Foreign Subsidiary Borrower hereby agrees that
service of all writs, process and summonses in any such action or proceeding
brought in the State of New York may be made upon Corporation Service Company,
presently located at 00 Xxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000-0000, X.X.X. (the
"Process Agent") and each Foreign Subsidiary Borrower hereby confirms and agrees
that the Process Agent has been duly and irrevocably appointed as its agent and
true and lawful attorney-in-fact in its name, place and stead to accept such
service of any and all such writs, process and summonses, and agrees that the
failure of the Process Agent to give any notice of any such service of process
to such Foreign Subsidiary Borrower (or to any other Person) shall not impair or
affect the validity of such service or of any judgment based thereon.
(c) 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
OR THE TRANSACTIONS CONTEMPLATED HEREBY (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 BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS PARAGRAPH.
(d) Nothing in this Section 12.8 shall affect the right of the
Administrative Agent or any Lender to serve legal process in any other manner
permitted by law or affect the right of the Administrative Agent or any Lender
to bring any action or proceeding against any Borrower or its property in the
courts of any other jurisdictions.
(e) To the extent that any Borrower has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether from
service or notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) with respect to itself or its property, such Borrower
hereby irrevocably waives such immunity in respect of its obligations under this
Agreement and its Notes.
Section 12.9. Table of Contents; Headings. Any table of contents and the
headings and captions hereunder are for convenience only and shall not affect
the interpretation or construction of this Agreement.
Section 12.10. Severability. The provisions of this Agreement are intended
to be severable. If for any reason any provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction, such provision
shall, as to such jurisdiction, be ineffective to the extent of such invalidity
or unenforceability without in any manner affecting the validity or
enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
Section 12.11. Authorization of Parent. Each Foreign Subsidiary Borrower
hereby authorizes the Parent to give on behalf of such Foreign Subsidiary
Borrower all notices, consents and other communications that may be given by
such Foreign Subsidiary Borrower under or in connection with this Agreement or
any other Facility Document, and to receive on behalf of such Foreign Subsidiary
Borrower all notices, consents and other communications that may be given to
such Foreign Subsidiary Borrower under or in connection with this Agreement or
any other Facility Document (in each case, irrespective of whether or not such
notice, consent or other communication is expressly provided elsewhere in this
Agreement to be given or received by the Parent on behalf of such Foreign
Subsidiary Borrower). Such notices, consents and other communications may
include Borrowing Requests, notices as to continuations, conversions and
prepayments of Loans, notices and demands in connection with Events of Default,
and notices and demands in connection with the exercise by the Administrative
Agent or any Lender of remedies. Such notices, consents and other communications
may be given by or to the Parent in its own name or in the name of such Foreign
Subsidiary Borrower. The authority given by each
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Foreign Subsidiary Borrower in this Section is coupled with an interest and is
irrevocable until all the Revolving Credit Commitments of the Lenders have
expired or been terminated and all the obligations of such Foreign Subsidiary
Borrower under this Agreement and the other Facility Documents have been paid in
full.
Section 12.12. Integration. The Facility Documents set forth the entire
agreement among the parties hereto relating to the transactions contemplated
thereby and supersede any prior oral or written statements or agreements with
respect to such transactions.
SECTION 12.13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
Section 12.14. Confidentiality.(a) (a) Each Lender (in its capacity as
Lender and, as applicable, as Swingline Bank and Issuing Bank) and the
Administrative Agent agrees (on behalf of itself and each of its Affiliates,
directors, officers, employees and representatives) to use reasonable
precautions to keep confidential, in accordance with safe and sound banking
practices, any non-public information supplied to it by any Borrower pursuant to
this Agreement which is identified by such Borrower (or by the Parent on behalf
of the applicable Foreign Subsidiary Borrower) as being confidential at the time
the same is delivered to the Lenders or the Administrative Agent, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any of the Lenders or the Administrative Agent, (iii) to bank
examiners, auditors or accountants, (iv) in connection with any litigation to
which any one or more of the Lenders is a party relating to the transaction
contemplated by this Agreement or (v) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the
respective Lender a Confidentiality Agreement in substantially the form of
Exhibit F hereto; and provided finally that in no event shall any Lender or the
Administrative Agent be obligated or required to return any materials furnished
by any Borrower.
(b) Notwithstanding anything in this Agreement to the contrary, each
Lender (in its capacity as Lender and, as applicable, as Swingline Bank and
Issuing Bank) and the Administrative Agent (and such Lender's or Administrative
Agent's employees, representatives or other agents, as the case may be) may
disclose to any and all persons, without limitation of any kind, the tax
treatment and tax structure of the transactions contemplated by this Agreement,
and all materials of any kind (including opinions or other tax analyses) related
to such tax treatment and tax structure, except that (i) this sentence shall not
apply to the extent that nondisclosure is reasonably necessary to comply with
the securities laws, and (ii) this sentence shall not permit any Person to
reveal the identity of the Parent or any of its Subsidiaries.
Section 12.15. Treatment of Certain Information. Each Borrower (a)
acknowledges that services may be offered or provided to it (in connection with
this Agreement or otherwise) by each Lender or by one or more of their
respective subsidiaries or Affiliates and (b) acknowledges that information
delivered to each Lender by any Borrower (or by the Parent on behalf of a
Foreign Subsidiary Borrower) may be provided to each such subsidiary and
Affiliate.
Section 12.16. Judgment Currency.(a) (a) The obligations hereunder of any
Borrower to make payments in dollars or in a particular Foreign Currency, as the
case may be (the "Obligation Currency"), shall not be discharged or satisfied by
any tender or recovery pursuant to any judgment expressed in or converted into
any currency other than the Obligation Currency, except to the extent that such
tender or recovery results in the effective receipt by the Administrative Agent,
the Issuing Bank, the Swingline Bank or a Lender of the full amount of the
Obligation Currency expressed to be payable to the Administrative Agent, the
Issuing Bank, the Swingline Bank or such Lender under this Agreement or the
other Facility Documents. If, for the purpose of obtaining or enforcing judgment
against any Borrower or any Guarantor in any court or in any jurisdiction, it
becomes necessary to convert into or from any currency other than the Obligation
Currency (such other currency being hereinafter referred to as the "Judgment
Currency") an amount due in the Obligation Currency, the conversion shall be
made, at the Dollar Equivalent or the
68
Foreign Currency Equivalent (as the case may be) of such amount, in each case,
as of the date immediately preceding the day on which the judgment is given
(such Business Day being hereinafter referred to as the "Judgment Currency
Conversion Date") using the current Exchange Rate as of the Judgment Currency
Conversion Date.
(b) If there is a change in the rate of exchange prevailing between
the Judgment Currency Conversion Date and the date of actual payment of the
amount due, the applicable Borrower, as the case may be, covenants and agrees to
pay, or cause to be paid, such additional amounts, if any (but in any event not
a lesser amount), as may be necessary to ensure that the amount paid in the
Judgment Currency, when converted at the rate of exchange prevailing on the date
of payment, will produce the amount of the Obligation Currency which could have
been purchased with the amount of Judgment Currency stipulated in the judgment
or judicial award at the rate of exchange prevailing on the Judgment Currency
Conversion Date.
(c) For purposes of determining the Dollar Equivalent, or the
Foreign Currency Equivalent (as the case may be), such amounts shall include any
premium and costs payable in connection with the purchase of the Obligation
Currency.
Section 12.17. Counterparts. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument, and any party hereto may execute this Agreement by signing any such
counterpart. 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
[THE REMAINDER OF THIS PAGE HAS INTENTIONALLY BEEN LEFT BLANK.]
69
MOVADO GROUP, INC.,
as Borrower
By: /s/ Xxxxxxx Xxxx
----------------------------------
Name: Xxxxxxx Xxxx
Title: Exec.V.P./COO
Address for Notices:
Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: Treasurer
Telecopier No.: 000-000-0000
with a simultaneous
copy to:
Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: General Counsel
Telecopier No.: 000-000-0000
70
CONCORD WATCH COMPANY S.A., as
Borrower
By: /s/ Xxxx Xxxxx
----------------------------------
Name: Xxxx Xxxxx
Title: Chairman of the Board
By: /s/ X. Xxxxxxxx
----------------------------------
Name: Emre Kurtoglu
Title: Vice Director
Address for Notices:
Concord Watch Company S.A.
c/o Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: Treasurer
Telecopier No.: 000-000-0000
with a simultaneous
copy to:
Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: General Counsel
Telecopier No.: 000-000-0000
71
MOVADO WATCH COMPANY
SA, as Borrower
By: /s/ Xxxx Xxxxx
----------------------------------
Name: Xxxx Xxxxx
Title: Chairman of the Board
By: /s/ X. Xxxxxxxx
----------------------------------
Name: Emre Kurtoglu
Title: Vice Director
Address for Notices:
Movado Watch Company SA
c/o Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: Treasurer
Telecopier No.: 000-000-0000
with a simultaneous
copy to:
Movado Group, Inc.
000 Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: General Counsel
Telecopier No.: 000-000-0000
72
JPMORGAN CHASE BANK, as Administrative
Agent, Lender, Swingline Bank and
Issuing Bank
By: /s/ Xxxxxxx X. Xxxx
----------------------------------
Xxxxxxx X. Xxxx
Vice President
Address for Notices as
Administrative Agent: Address for Notices as Lender and
Swingline Bank:
JPMorgan Chase Bank
Loan and Agency Services Group JPMorgan Chase Bank
0000 Xxxxxx, 00xx Xxxxx 000 Xxxxx 00 Xxxx
Xxxxxxx, Xxxxx 00000-0000 Xxxxxxxxx, Xxx Xxxxxx 00000
Telecopier No.: 000-000-0000 Attention: Xx. Xxxxxxx X. Xxxx
Telecopier No.: 000-000-0000
with a simultaneous copy to: Address for Notices as Issuing Bank:
JPMorgan Chase Bank JPMorgan Chase Bank
000 Xxxxx 00 Xxxx 00000 Xxxxxxxx
Xxxxxxxxx, New Jersey 07004 Mountain Drive,
Attention: Xx. Xxxxxxx X. Xxxx Xxxxxxxx 0, 0xx Xxxxx
Telecopier No.: 000-000-0000 Xxxxx, Xxxxxxx 00000
Telecopier No.: 000-000-0000 (for
standby L/C's)
And, if in respect of Foreign Currency Telecopier No.: 000-000-0000 (for
a simultaneous copy to: documentary Borrowings, with
L/C's)
X.X. Xxxxxx Europe Limited With a simultaneous copy to:
000 Xxxxxx Xxxx
Xxxxxx XX0X 0XX JPMorgan Chase Bank
Attention: Ms. Xxxxxxxx Xxxxx 000 Xxxxx 00 Xxxx
Telecopier No.: 00-000-000-0000
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxx
Telecopier No.: 000-000-0000
Lending Office:
JPMorgan Chase Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
73
FLEET NATIONAL BANK,
as Lender
By: /s/ Xxxx X. Xxxx
----------------------------------
Xxxx X. Xxxx
Vice President
Lending Office and
Address for Notices:
Fleet National Bank
1185 Avenue of the Americas
Mail Stop: NY EH 30902L
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxx X. Xxxx
Telecopier No.: 000-000-0000
00
XXX XXXX XX XXX
XXXX, as Lender
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx
Vice President
Lending Office and
Address for Notices:
The Bank of New York
000 Xxxxx Xxxx Xxxx
Xxxx Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxx
Telecopier No.: 000-000-0000
75
CITIBANK, N.A., as
Lender
By: /s/ Xxxxxxx X. Patina
----------------------------------
Xxxxxxx X. Xxxxxxx
Vice President
Lending Office and
Address for Notices:
Citibank, N.A.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxxx Xxxxxxx
Telecopier No.: 000-000-0000
76
EXHIBIT A-1
PROMISSORY NOTE
(Syndicated Loans)
[Date of Note]
__________________________________________ (the "Borrower"), for value
received, hereby promises to pay to the order of _______________________ (the
"Lender"), at the office of JPMorgan Chase Bank (the "Administrative Agent")
described in the Credit Agreement (as such term is hereinafter defined), for the
account of the appropriate Lending Office of the Lender, the amount of the
Syndicated Loans made by the Lender to the Borrower pursuant to the Credit
Agreement, in immediately available funds, on the dates, in the currency and in
the manner provided in the Credit Agreement. The Borrower also promises to pay
interest on the unpaid principal balance hereof, for the period such balance is
outstanding, at said office for the account of such Lending Office at the rates
of interest provided in the Credit Agreement, on the dates, in the currency and
in the manner provided in the Credit Agreement.
The date and amount of each Syndicated Loan made by the Lender to the
Borrower under the Credit Agreement, and whether such Loan is a LIBOR Loan or an
ABR Loan, and the currency in which such Loan is made, and the date and amount
of each payment of principal thereof, shall be recorded by the Lender on its
books and, prior to any transfer of this Note (or, at the discretion of the
Lender, at any other time), endorsed by the Lender on the schedule attached
hereto or any continuation thereof.
This is one of the Syndicated Loan Notes referred to in that certain
Credit Agreement (as amended from time to time, the "Credit Agreement") dated as
of June ___, 2003 among Movado Group, Inc., Concord Watch Company S.A., Movado
Watch Company SA, the Lenders signatory thereto, and JPMorgan Chase Bank, as
Administrative Agent, as Swingline Bank and as Issuing Bank. This Note evidences
the Syndicated Loans made by the Lender to the Borrower thereunder. All
capitalized terms not defined herein shall have the meanings given to them in
the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity of the
principal of this Note upon the occurrence of certain Events of Default
specified therein.
The Borrower waives presentment, notice of dishonor, protest and any other
notice or formality with respect to this Note.
This Note shall be governed by, and interpreted and construed in
accordance with, the laws of the State of New York.
[NAME OF BORROWER]
By:
---------------------------------
Name:
Title:
[SECOND SIGNATURE LINE FOR FOREIGN
SUBSIDIARY BORROWER
By:
---------------------------------
77
Name:
Title:]
78
Amount LIBOR Amount of Balance Notation
Date of Loan or ABR Currency Payment Outstanding By
79
EXHIBIT A-2
PROMISSORY NOTE
(Swingline Loans)
$10,000,000 [Date of Note]
MOVADO GROUP, INC., a New York corporation (the "Borrower"), for value
received, hereby promises to pay to the order of JPMORGAN CHASE BANK (the
"Swingline Bank"), at the office of JPMorgan Chase Bank (the "Administrative
Agent") described in the Credit Agreement (as such term is hereinafter defined),
for the account of the appropriate Lending Office of the Swingline Bank, the
principal sum of Ten Million Dollars or, if less, the amount of the Swingline
Loans made by the Swingline Bank to the Borrower pursuant to the Credit
Agreement that are outstanding, in lawful money of the United States, in
immediately available funds, on the dates and in the manner provided in the
Credit Agreement. The Borrower also promises to pay interest on the unpaid
principal balance hereof, for the period such balance is outstanding, at said
office for the account of such Lending Office in lawful money of the United
States at the rates of interest provided in the Credit Agreement, on the dates
and in the manner provided in the Credit Agreement.
The date and amount of each Swingline Loan made by the Swingline Bank to
the Borrower under the Credit Agreement, and each payment of principal thereof,
shall be recorded by the Swingline Bank on its books and, prior to any transfer
of this Note (or, at the discretion of the Swingline Bank, at any other time),
endorsed by the Swingline Bank on the schedule attached hereto or any
continuation thereof.
This is the Swingline Loan Note referred to in that certain Credit
Agreement (as amended from time to time, the "Credit Agreement") dated as of
June ___, 2003 among Movado Group, Inc., Concord Watch Company S.A., Movado
Watch Company SA, the Lenders signatory thereto, and JPMorgan Chase Bank, as
Administrative Agent, as Swingline Bank and as Issuing Bank. This Note evidences
the Swingline Loans made by the Swingline Bank thereunder. All capitalized terms
not defined herein shall have the meanings given to them in the Credit
Agreement.
The Credit Agreement provides for the acceleration of the maturity of the
principal of this Note upon the occurrence of certain Events of Default
specified therein.
The Borrower waives presentment, notice of dishonor, protest and any other
notice or formality with respect to this Note.
This Note shall be governed by, and interpreted and construed in
accordance with, the laws of the State of New York.
MOVADO GROUP, INC.
By:
---------------------------------
Name:
Title:
Amount Amount of Balance Notation
Date of Loan Payment Outstanding By
2
EXHIBIT B
June ___, 2003
JPMorgan Chase Bank, as
Administrative Agent
Loan and Agency Services Group
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: The Credit Agreement dated as of the date hereof (which, as the same may
hereafter be amended, will be called herein the "Credit Agreement") among
Movado Group, Inc., Concord Watch Company S.A., Movado Watch Company SA,
the Lenders signatory thereto, and JPMorgan Chase Bank, as Administrative
Agent, and as Swingline Bank and as Issuing Bank. Capitalized terms used
herein have the meanings ascribed to them in the Credit Agreement.
Ladies and Gentlemen:
In connection with the captioned Credit Agreement, the Borrowers hereby
designate any one of the following persons to give to you instructions,
including notices required pursuant to the Agreement, orally or by telephone or
teleprocess or email:
NAME
Xxxx Xxxx
Xxxx Xxxxxxxxx
Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxxx Xxxxxx
Instructions may be honored on the oral, telephonic, teleprocess or email
instructions of anyone purporting to be any one of the above designated persons.
The Parent will furnish you with confirmation of each such instruction either by
telex (whether tested or untested) or in writing signed by any person designated
above (including any telecopy which appears to bear the signature of any person
designated above) on the same day that the instruction is provided to you but
your responsibility with respect to any instruction shall not be affected by
your failure to receive such confirmation or by its contents. Transactions that
are the subject of such instructions are to be processed (a) for the Parent,
through Movado Group, Inc. DDA Account #0381130798 at the Administrative Agent;
(b) for Concord, through Concord Watch Company S.A. at UBS SA account number
235-00000000.0 (CHF Account), 235-00000000.1 (USD Account) or 235-FJ126408.1
(Euro Account); (c) for MWC, through Movado Watch Company SA at UBS SA account
number 235-00000000.0 (CHF Account), or 235-00000000.2 (USD Account), or
235-FJ111477.0 (Euro Account); or (d) in the case of any Borrower, such other
account as may be mutually agreed to by you and the Parent (the Parent's
agreement as to such other account to be evidenced by a writing signed by two of
the above-designated persons).
You shall be fully protected in, and shall incur no liability to any of
the Borrowers for, acting upon any instructions which you in good faith believe
to have been given by any person designated above, and in no event shall you be
liable for special, consequential or punitive damages. In addition, the
Borrowers agree to hold you and your agents harmless from any and all liability,
loss and expense arising directly or indirectly out of instructions that any
Borrower (or the Parent on behalf of any Foreign Subsidiary Borrower) provides
to you in connection with the Credit Agreement except for liability, loss or
expense occasioned by the gross negligence or willful misconduct of you or your
agents.
Upon notice to the Parent, you may, at your option, refuse to execute any
instruction, or part thereof, without incurring any responsibility for any loss,
liability or expense arising out of such refusal if you in good faith believe
that the person delivering the instruction is not one of the persons designated
above or if the instruction is not accompanied by an authentication method that
the Parent agreed to in writing.
The Parent will promptly notify you in writing of any change in the
persons designated above and, until you have actually received such written
notice and have had a reasonable opportunity to act upon it, you are authorized
to act upon instructions, even though the person delivering them may no longer
be authorized.
Very truly yours,
MOVADO GROUP, INC.
By:
---------------------------------
Name:
Title:
CONCORD WATCH COMPANY S.A.
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
MOVADO WATCH COMPANY SA
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
2
EXHIBIT C-1
(Form of Opinion of Xxxxxxx X. Xxxxxx, Esq.)
EXHIBIT C-2
(Form of Opinion of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP)
EXHIBIT C-3
(Form of Opinion of Swiss Counsel to the Foreign Subsidiary Borrowers)
EXHIBIT D-1
SUBSIDIARY GUARANTEE
REFERENCE IS HEREBY MADE to the Credit Agreement dated as of June ___,
2003 (which, as the same has heretofore been or may hereafter be amended from
time to time, will be called herein the "Credit Agreement") among Movado Group,
Inc., a New York corporation (the "Parent"), Concord Watch Company S.A.
("Concord"), Movado Watch Company SA ("MWC"), the Lenders signatory thereto, and
JPMorgan Chase Bank, as Administrative Agent, as Swingline Bank and as Issuing
Bank. All capitalized terms used herein and not defined shall have the
respective meanings ascribed to them in the Credit Agreement.
WHEREAS, the Credit Agreement provides for the extension of credit by the
Lenders, the Swingline Bank and the Issuing Bank (all of which, together with
the Administrative Agent, will be called herein the "Creditors") to the Parent;
and
WHEREAS, all the obligations and liabilities (whether now existing or
hereafter arising) of the Parent to any or all of the Creditors under the Credit
Agreement or any of the other Facility Documents (including without limitation
the Parent Guarantee), whether for principal, interest, fees, reimbursement
obligations, indemnification obligations, costs of enforcement or otherwise,
will be called herein the "Obligations" (for the avoidance of doubt, the term
"Obligations" includes any increase in such obligations and liabilities
resulting from an increase in the Total Revolving Credit Commitment pursuant to
Section 2.16 of the Credit Agreement); and
WHEREAS, the Guarantor expects to obtain substantial economic benefit from
the extension of credit by the Creditors to the Parent under the Credit
Agreement; and
WHEREAS, the execution and delivery of this guaranty by the Guarantor is
required pursuant to the terms of the Credit Agreement;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and to induce the Creditors to extend credit to
the Parent under the Facility Documents, the Guarantor hereby agrees with the
Creditors as follows:
1. The Guarantor hereby unconditionally guarantees to the Creditors that
the Parent will promptly pay, perform and observe all the Obligations, and that
all sums stated to be payable in, or which become payable under, the Facility
Documents by the Parent will be promptly paid in full when due, whether at
stated maturity or earlier by reason of acceleration or otherwise, and, in the
case of one or more extensions of time of payment or performance or renewals of
any Obligation, that the same will be promptly paid or performed (as the case
may be) when due according to such extension or renewal, whether at stated
maturity or earlier by reason of acceleration or otherwise, irrespective of the
validity, regularity, or enforceability of any of the Facility Documents or any
of the Obligations and irrespective of any present or future law or order of any
government (whether of right or in fact and whether the Creditors shall have
consented thereto) or of any agency thereof purporting to reduce, amend,
restructure or otherwise affect any Obligation of the Parent or other obligor or
to vary the terms of payment; provided, however, that the liability of the
Guarantor hereunder with respect to the Obligations shall be limited to an
aggregate amount equal to the largest amount that would not render such
liability subject to avoidance under Section 548 of the Federal Bankruptcy Code
or any comparable provisions of any applicable state law.
2. The Guarantor agrees that, as among the Guarantor and the Creditors,
the Obligations may be declared to be due and payable for purposes of this
guaranty notwithstanding any stay, injunction or other prohibition which may
prevent, delay or vitiate any such declaration as against the Parent and that,
in the event of any such declaration (or attempted declaration), such
Obligations (whether or not due and payable by the Parent) shall forthwith
become due and payable by the Guarantor for purposes of this
guaranty. The Guarantor further guarantees that all payments made by the Parent
to the Creditors of any Obligation will, when made, be final and agrees that if
any such payment is recovered from, or repaid by, any Creditor in whole or in
part in any bankruptcy, insolvency or similar proceeding instituted by or
against the Parent, this guaranty shall continue to be fully applicable to such
Obligation to the same extent as though the payment so recovered or repaid had
never been originally made on such Obligation.
3. This is a guaranty of payment and not of collection only.
4. The Guarantor hereby consents that from time to time, without notice to
or further consent of the Guarantor, the payment, performance or observance of
any or all of the Obligations may be waived or the time of payment or
performance thereof extended or accelerated, or renewed in whole or in part, or
the terms of the Facility Documents or any part thereof may be changed
(including, without limitation, an increase or decrease in the Total Revolving
Credit Commitment or any Lender's Revolving Credit Commitment or rate of
interest thereon) and any collateral therefor may be exchanged, surrendered or
otherwise dealt with as the Creditors may determine, and any of the acts
mentioned in the Facility Documents may be done, all without affecting the
liability of the Guarantor hereunder. The Guarantor hereby waives presentment of
any instrument, demand of payment, protest and notice of non-payment or protest
thereof or of any exchange, sale, surrender or other handling or disposition of
such collateral, and any requirement that any Creditor exhaust any right, power
or remedy or proceed against the Parent under the Facility Documents or against
any other person under any other guaranty of, or security for, any of the
Obligations. The Guarantor hereby further waives any defense whatsoever which
might constitute a defense available to, or discharge of, the Parent or a
guarantor. No payment by the Guarantor pursuant to any provision hereunder shall
entitle the Guarantor, by subrogation to the rights of any Creditor or
otherwise, to any payment by the Parent (or out of the property of the Parent)
except after payment in full of all sums (including interest, costs and
expenses) which may be or become payable by the Parent to the Creditors at any
time or from time to time.
5. This guaranty shall be a continuing guaranty, and any other guarantor,
and any other party liable upon or in respect of any Obligation hereby
guaranteed, may be released without affecting the liability of the Guarantor
hereunder. The liability of the Guarantor hereunder shall be joint and several
with the liability of any other guarantor or other party upon or in respect of
the Obligations.
6. Any Creditor may assign its rights and powers hereunder, with all or
any of the Obligations, and, in the event of such assignment, the assignee
hereof or of such rights and powers, shall have the same rights and remedies as
if originally named herein. The Guarantor may not assign or transfer any of its
rights or obligations under this guaranty without the written approval of all
the Lenders (and any such assignment or transfer that is attempted without such
consent shall be void).
7. Notice of acceptance of this guaranty and of the incurring of any and
all of the Obligations of the Parent pursuant to the Facility Documents is
hereby waived. This guaranty and all rights, obligations and liabilities arising
hereunder shall be governed by and construed according to the laws of the State
of New York. Unless the context otherwise requires, all terms used herein which
are defined in the Uniform Commercial Code shall have the meanings therein
stated.
8. The Guarantor agrees that , in addition to (and without limitation of)
any right of setoff, banker's lien or counterclaim any Creditor may otherwise
have, each of the Creditors shall be entitled, at its option, to set off and
apply balances (general or special, time or demand, provisional or final) held
by it for account of the Guarantor at any of its offices in dollars or in any
other currency, against any amounts owing hereunder that are not paid when due
(regardless of whether such balances are then due to the Guarantor), in which
case it shall promptly notify the Guarantor thereof; provided however that any
failure to give such notice shall not affect the validity thereof.
9. No provision of this guaranty may be modified or waived without the
prior written consent of the Administrative Agent and the Required Lenders (or,
to the extent required by the Credit Agreement, all Lenders).
2
10. Without limiting the rights of any Creditor under any other agreement,
any financial accommodation (including, without limitation, interest accruing at
the agreed to contract rate after the commencement of any bankruptcy,
reorganization or similar proceeding) extended by the Guarantor to or for the
account of the Parent, or in respect of which the Parent may be liable to the
Guarantor in any capacity, is hereby subordinated to all the Obligations, and
such financial accommodation of the Guarantor to the Parent, if the
Administrative Agent so requests, shall be collected, enforced and received by
the Guarantor as trustee for the Creditors and be paid over to the
Administrative Agent on account of the Obligations but without reducing or
affecting in any manner the liability of the Guarantor, under the other
provisions of this guaranty.
11. The Guarantor hereby irrevocably submits to the jurisdiction of any
New York State or Federal court sitting in New York City in any action or
proceeding arising out of or relating to this guaranty, and the Guarantor hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such New York State or Federal court. The Guarantor
irrevocably consents to the service of any and all process in any such action or
proceeding by the mailing of copies of such process to the Guarantor at its
address specified on the signature page hereof. The Guarantor 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 paragraph shall affect the rights of the
Creditors to serve legal process in any other manner permitted by law or affect
the rights of the Creditors to bring any action or proceeding against the
Guarantor or any of its property in the courts of any other jurisdiction. To the
extent that the Guarantor has or hereafter may acquire any immunity from
jurisdiction of any court or from any legal process (whether from service or
notice, attachment prior to judgment, attachment in aid of execution, execution
or otherwise) with respect to itself or its property, the Guarantor hereby
irrevocably waives such immunity in respect of its Obligations under this
guaranty. The Guarantor hereby expressly waives any and every right to a trial
by jury in any action on or related to this guaranty, the Obligations or the
enforcement of either or all of the same, and does further expressly waive any
and every right to interpose any counterclaim in any such action or proceeding.
To the extent permitted by applicable law, the Guarantor shall not assert, and
the Guarantor 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 guaranty, any other Facility Document or any agreement or instrument
contemplated hereby or thereby, any Loan or Letter of Credit or the use of the
proceeds thereof. The Guarantor agrees to reimburse the Creditors on demand for
all reasonable costs, expenses, and charges (including, without limitation,
reasonable attorneys' fees) incurred by the Administrative Agent or the Lenders
in connection with any enforcement of this guaranty.
12. The rights, powers and remedies granted to the Creditors herein shall
be cumulative and in addition to any rights, powers and remedies to which the
Creditors may be entitled either by operation of law or pursuant to the Facility
Documents or any other document or instrument delivered or from time to time to
be delivered to the Administrative Agent or any Lender in connection with the
Facility Documents.
IN WITNESS WHEREOF, the Guarantor has caused this instrument to be duly
executed by its proper officer(s) this day of , 200 .
WITNESS: [NAME OF GUARANTOR]
By:
-------------------------------------------- ------------------------
Name: Name:
--------------------------------------- ------------------------
Title:
------------------------
3
Address of Guarantor:
000 Xxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
4
EXHIBIT D-2
PARENT GUARANTEE
REFERENCE IS HEREBY MADE to the Credit Agreement dated as of June ___,
2003 (which, as the same has heretofore been or may hereafter be amended from
time to time, will be called herein the "Credit Agreement") among Movado Group,
Inc., a New York corporation (the "Parent"), Concord Watch Company S.A.
("Concord"), Movado Watch Company SA ("MWC"), the Lenders signatory thereto, and
JPMorgan Chase Bank, as Administrative Agent, as Swingline Bank and as Issuing
Bank. All capitalized terms used herein and not defined shall have the
respective meanings ascribed to them in the Credit Agreement.
WHEREAS, the Credit Agreement provides for the extension of credit by the
Lenders (all of which, together with the Administrative Agent, will be called
herein the "Creditors") to Concord and to MWC (the "Foreign Subsidiary
Borrowers"); and
WHEREAS, all the obligations and liabilities (whether now existing or
hereafter arising) of either or both of the Foreign Subsidiary Borrowers to any
or all of the Creditors under the Credit Agreement or any of the other Facility
Documents (whether for principal, interest, fees, reimbursement obligations,
indemnification obligations, costs of enforcement or otherwise) will be called
herein the "Obligations" (for the avoidance of doubt, the term "Obligations"
includes any increase in such obligations and liabilities resulting from an
increase in the Total Revolving Credit Commitment pursuant to Section 2.16 of
the Credit Agreement); and
WHEREAS, the Parent expects to obtain substantial economic benefit from
the extension of credit by the Creditors to the Foreign Subsidiary Borrowers
under the Credit Agreement; and
WHEREAS, the execution and delivery of this guaranty by the Parent is
required pursuant to the terms of the Credit Agreement;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and to induce the Creditors to extend credit to
the Foreign Subsidiary Borrowers under the Facility Documents, the Parent hereby
agrees with the Creditors as follows:
1. The Parent hereby unconditionally guarantees to the Creditors that each
Foreign Subsidiary Borrower will promptly pay, perform and observe all the
Obligations of such Foreign Subsidiary Borrower, and that all sums stated to be
payable in, or which become payable under, the Facility Documents by either or
both of the Foreign Subsidiary Borrowers will be promptly paid in full when due,
whether at stated maturity or earlier by reason of acceleration or otherwise,
and, in the case of one or more extensions of time of payment or performance or
renewals of any Obligation, that the same will be promptly paid or performed (as
the case may be) when due according to such extension or renewal, whether at
stated maturity or earlier by reason of acceleration or otherwise, irrespective
of the validity, regularity, or enforceability of any of the Facility Documents
or any of the Obligations and irrespective of any present or future law or order
of any government (whether of right or in fact and whether the Creditors shall
have consented thereto) or of any agency thereof purporting to reduce, amend,
restructure or otherwise affect any Obligation of the Foreign Subsidiary
Borrower or other obligor or to vary the terms of payment; provided, however,
that the liability of the Parent hereunder with respect to the Obligations shall
be limited to an aggregate amount equal to the largest amount that would not
render such liability subject to avoidance under Section 548 of the Federal
Bankruptcy Code or any comparable provisions of any applicable state law.
2. The Parent agrees that, as among the Parent and the Creditors, the
Obligations may be declared to be due and payable for purposes of this guaranty
notwithstanding any stay, injunction or other prohibition which may prevent,
delay or vitiate any such declaration as against either or both of the Foreign
Subsidiary Borrowers and that, in the event of any such declaration (or
attempted declaration),
such Obligations (whether or not due and payable by either or both of the
Foreign Subsidiary Borrowers) shall forthwith become due and payable by the
Parent for purposes of this guaranty. The Parent further guarantees that all
payments made by the Parent to the Creditors of any Obligation will, when made,
be final and agrees that if any such payment is recovered from, or repaid by,
any Creditor in whole or in part in any bankruptcy, insolvency or similar
proceeding instituted by or against either or both of the Foreign Subsidiary
Borrowers, this guaranty shall continue to be fully applicable to such
Obligation to the same extent as though the payment so recovered or repaid had
never been originally made on such Obligation.
3. This is a guaranty of payment and not of collection only.
4. The Parent hereby consents that from time to time, without notice to or
further consent of the Parent, the payment, performance or observance of any or
all of the Obligations may be waived or the time of payment or performance
thereof extended or accelerated, or renewed in whole or in part, or the terms of
the Facility Documents or any part thereof may be changed (including, without
limitation, an increase or decrease in the Foreign Currency Sublimit Dollar
Amount, Total Revolving Credit Commitment or any Lender's Revolving Credit
Commitment or rate of interest thereon) and any collateral therefor may be
exchanged, surrendered or otherwise dealt with as the Creditors may determine,
and any of the acts mentioned in the Facility Documents may be done, all without
affecting the liability of the Parent hereunder. The Parent hereby waives
presentment of any instrument, demand of payment, protest and notice of
non-payment or protest thereof or of any exchange, sale, surrender or other
handling or disposition of such collateral, and any requirement that any
Creditor exhaust any right, power or remedy or proceed against either or both of
the Foreign Subsidiary Borrowers under the Facility Documents or against any
other person under any other guaranty of, or security for, any of the
Obligations. The Parent hereby further waives any defense whatsoever which might
constitute a defense available to, or discharge of, either or both of the
Foreign Subsidiary Borrowers or a guarantor. No payment by the Parent pursuant
to any provision hereunder shall entitle the Parent, by subrogation to the
rights of any Creditor or otherwise, to any payment by either or both of the
Foreign Subsidiary Borrowers (or out of the property of either or both of the
Foreign Subsidiary Borrowers) except after payment in full of all sums
(including interest, costs and expenses) which may be or become payable by such
Foreign Subsidiary Borrower to the Creditors at any time or from time to time.
5. This guaranty shall be a continuing guaranty, and any other guarantor,
and any other party liable upon or in respect of any Obligation hereby
guaranteed, may be released without affecting the liability of the Parent
hereunder. The liability of the Parent hereunder shall be joint and several with
the liability of any other guarantor or other party upon or in respect of the
Obligations.
6. Any Creditor may assign its rights and powers hereunder, with all or
any of the Obligations, and, in the event of such assignment, the assignee
hereof or of such rights and powers, shall have the same rights and remedies as
if originally named herein. The Parent may not assign or transfer any of its
rights or obligations under this Guaranty without the written approval of all
the Lenders (and any such assignment or transfer that is attempted without such
consent shall be void).
7. Notice of acceptance of this guaranty and of the incurring of any and
all of the Obligations of either or both of the Foreign Subsidiary Borrowers
pursuant to the Facility Documents is hereby waived. This guaranty and all
rights, obligations and liabilities arising hereunder shall be governed by and
construed according to the laws of the State of New York. Unless the context
otherwise requires, all terms used herein which are defined in the Uniform
Commercial Code shall have the meanings therein stated.
8. The Parent agrees that , in addition to (and without limitation of) any
right of setoff, banker's lien or counterclaim any Creditor may otherwise have,
each of the Creditors shall be entitled, at its option, to set off and apply
balances (general or special, time or demand, provisional or final) held by it
for account of the Parent at any of its offices in dollars or in any other
currency, against any amounts owing hereunder that are not paid when due
(regardless of whether such balances are then due to the Parent), in which case
it shall promptly notify the Parent thereof; provided however that any failure
to give such notice shall not affect the validity thereof.
2
9. No provision of this guaranty may be modified or waived without the
prior written consent of the Administrative Agent and the Required Lenders (or,
to the extent required by the Credit Agreement, all Lenders).
10. Without limiting the rights of any Creditor under any other agreement,
any financial accommodation (including, without limitation, interest accruing at
the agreed to contract rate after the commencement of any bankruptcy,
reorganization or similar proceeding) extended by the Parent to or for the
account of either or both of the Foreign Subsidiary Borrowers, or in respect of
which either or both of the Foreign Subsidiary Borrowers may be liable to the
Parent in any capacity, is hereby subordinated to all the Obligations payable by
such Foreign Subsidiary Borrower, and such financial accommodation of the Parent
to either or both of the Foreign Subsidiary Borrowers, if the Administrative
Agent so requests, shall be collected, enforced and received by the Parent as
trustee for the Creditors and be paid over to the Administrative Agent on
account of the Obligations payable by such Foreign Subsidiary Borrower but
without reducing or affecting in any manner the liability of the Parent, under
the other provisions of this guaranty.
11. The Parent hereby irrevocably submits to the jurisdiction of any New
York State or Federal court sitting in New York City in any action or proceeding
arising out of or relating to this guaranty, and the Parent hereby irrevocably
agrees that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. The Parent irrevocably
consents to the service of any and all process in any such action or proceeding
by the mailing of copies of such process to the Parent at its address specified
on the signature page hereof. The Parent 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 paragraph shall affect the rights of the Creditors to serve
legal process in any other manner permitted by law or affect the rights of the
Creditors to bring any action or proceeding against the Parent or any of its
property in the courts of any other jurisdiction. To the extent that the Parent
has or hereafter may acquire any immunity from jurisdiction of any court or from
any legal process (whether from service or notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, the Parent hereby irrevocably waives such immunity in respect
of its Obligations under this guaranty. The Parent hereby expressly waives any
and every right to a trial by jury in any action on or related to this guaranty,
the Obligations or the enforcement of either or all of the same, and does
further expressly waive any and every right to interpose any counterclaim in any
such action or proceeding. To the extent permitted by applicable law, the Parent
shall not assert, and the Parent 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 guaranty, any other Facility Document
or any agreement or instrument contemplated hereby or thereby, any Loan or
Letter of Credit or the use of the proceeds thereof. The Parent agrees to
reimburse the Creditors on demand for all reasonable costs, expenses, and
charges (including, without limitation, reasonable attorneys' fees) incurred by
the Administrative Agent or the Lenders in connection with any enforcement of
this guaranty.
12. The rights, powers and remedies granted to the Creditors herein shall
be cumulative and in addition to any rights, powers and remedies to which the
Creditors may be entitled either by operation of law or pursuant to the Facility
Documents or any other document or instrument delivered or from time to time to
be delivered to the Administrative Agent or any Lender in connection with the
Facility Documents.
3
IN WITNESS WHEREOF, the Parent has caused this instrument to be duly
executed by its proper officer(s) this day of June, 2003.
WITNESS: MOVADO GROUP, INC.
By:
-------------------------------------------- ---------------------------
Name: Name:
--------------------------------------- ---------------------------
Title:
---------------------------
Address of Parent:
000 Xxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
4
EXHIBIT E
ASSIGNMENT AND ASSUMPTION AGREEMENT
Dated as of ____________, 200__
Reference is made to the Credit Agreement dated as of June ___, 2003
(which, as the same has been or may have been amended, will be called herein the
"Credit Agreement"), among Movado Group, Inc., a New York corporation (the
"Parent"), Concord Watch Company S.A., Movado Watch Company SA, the Lenders
signatory thereto, and JPMorgan Chase Bank, as Administrative Agent, as
Swingline Bank and as Issuing Bank. Terms defined in the Credit Agreement and
used herein without definition shall have the respective meanings ascribed to
such terms in the Credit Agreement.
[Name of assigning bank] ("Assignor") and [name of assignee]
("Assignee") hereby agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse to the Assignor, and the Assignee hereby purchases and assumes from the
Assignor, without recourse to the Assignor, a _____ percent (___%) interest in
all of the Assignor's rights and obligations under the Credit Agreement as of
the Assignment Date (as hereinafter defined), including without limitation (a)
the Assignor's Revolving Credit Commitment (including, without limitation, the
Assignor's obligation to make Syndicated Loans and to participate in Letters of
Credit and in Swingline Loans) and (b) the Assignor's outstanding Syndicated
Loans.
2. (a) The Assignor represents to the Assignee that as of the date
hereof, before giving effect to the assignment contemplated hereby, its
Revolving Credit Commitment is $__________ and the aggregate outstanding
principal amount of its Syndicated Loans equals $__________. The Assignor
further represents that it is the legal and beneficial owner of the interest
being assigned by it hereunder and that such interest is free and clear of any
adverse claim.
(b) Except as expressly provided in subsection (a) of this
Section, the Assignor makes no representation or warranty in connection with
this Assignment and Assumption Agreement. Without limiting the generality of the
immediately preceding sentence: the Assignor makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Facility Document or any other instrument or document furnished pursuant thereto
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement or any other Facility Document or any other
instrument or document furnished pursuant thereto; and the Assignee makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Parent or any Subsidiary or the performance or
observance by the Parent or any Subsidiary of any of their respective
obligations under any Facility Document or any other instrument or document
furnished pursuant to the Credit Agreement.
3. The Assignee represents and warrants that it is legally authorized to
enter into this Agreement. The Assignee also acknowledges, agrees and confirms
that (a) it has received a copy of the Credit Agreement, together with copies of
the most recent financial statements referred to in Section 6.5 of the Credit
Agreement or delivered pursuant to Sections 7.8(a) and (b) of the Credit
Agreement, and such other Facility Documents and other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into this Assignment and Assumption Agreement; and (b) it will
independently and without reliance upon the Administrative Agent, the Assignor
or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement; and (c) it appoints and authorizes
the Administrative Agent to take such action as agent on its behalf and to
exercise such powers under the Credit Agreement and the other Facility Documents
as are delegated to the Administrative Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; and (d) it agrees that it will
perform in accordance with their terms all the obligations which by the
terms of this Credit Agreement are required to be performed by it as a Lender.
4. The effective date for this Assignment and Assumption Agreement
shall be , 200 (the "Assignment Date"), provided that this
Assignment and Assumption Agreement shall have been executed and delivered by
the Assignor and the Assignee and consented to by the Administrative Agent and
the Parent (except that the consent of the Parent shall not be required if an
Event of Default exists as a result of the commencement of a case with respect
to the Parent under the Federal Bankruptcy Code or as a result of the
commencement of a bankruptcy, insolvency, reorganization, receivership or
similar proceeding with respect to either Foreign Subsidiary Borrower under
Swiss or other foreign law). Following the execution of this Assignment and
Assumption Agreement, each such party shall deliver its duly executed
counterpart hereof to the Administrative Agent for acceptance and recording in
the record maintained by the Administrative Agent pursuant to Section 12.5(d) of
the Credit Agreement.
5. Upon such acceptance and recording, and from and after the
Assignment Date, (i) the Assignee shall become a party to the Credit Agreement
and a "Lender" for purposes thereof, and to the extent provided in this
Assignment and Assumption Agreement, shall have the rights (except under Article
4 and Section 12.3 of the Credit Agreement in respect of the period prior to the
Assignment Date) and obligations of a Lender the Credit Agreement, and (ii) the
Assignor shall, with respect to that portion of its interest under the Credit
Agreement assigned hereunder, relinquish its rights (except under Article 4 and
Section 12.3 of the Credit Agreement in respect of the period prior to the
Assignment Date) and be released from its obligations under the Credit
Agreement.
6. Upon such acceptance and recording, and from and after the
Assignment Date, the Administrative Agent shall make all payments in respect of
the rights and interests assigned hereby (including payments of principal,
interest, fees and other amounts) to the Assignee. Each of the Assignor and the
Assignee hereby agree that if it receives any amount under any Facility Document
which is for the account of the other of them, it shall receive the same for the
account of such other party to the extent of such other party's interest therein
and shall promptly pay the same to such other party.
7. This Assignment and Assumption Agreement shall be governed by and
construed in accordance with the laws of the State of New York (without
reference to conflict of laws).
8. This Assignment and Assumption Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one and the same Agreement.
IN WITNESS WHEREOF, this Agreement has been executed as of the day
first above written.
[Assignor]
By:
---------------------------------
Name:
Title:
[Assignee]
By:
---------------------------------
Name:
Title:
2
Consented to:
MOVADO GROUP, INC.
By:
-----------------------------------------
Name:
Title:
JPMORGAN CHASE BANK, AS ADMINISTRATIVE
AGENT, AS SWINGLINE BANK AND AS ISSUING BANK
By:
-----------------------------------------
Name:
Title:
3
EXHIBIT F
CONFIDENTIALITY AGREEMENT
__________________, 200____
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Credit Agreement dated as of June ___, 2003 (which, as the same may
hereafter be amended, will be called herein the "Credit Agreement") among
Movado Group, Inc., Concord Watch Company S.A., Movado Watch Company SA
(collectively, the "Borrowers"), the Lenders signatory thereto, and
JPMorgan Chase Bank, as Administrative Agent, as Swingline Bank and as
Issuing Bank.
Dear _____________:
As a Lender, party to the Credit Agreement, we have agreed with the
Borrowers pursuant to Section 12.14 of the Credit Agreement to use reasonable
precautions to keep confidential, except as otherwise provided therein, all
non-public information identified by any Borrower as being confidential at the
time the same is delivered to us pursuant to the Credit Agreement.
As provided in said Section 12.14, we are permitted to provide you, as a
prospective [holder of a participation in the Loans (as defined in the Credit
Agreement)] [assignee Lender], with certain of such non-public information
subject to the execution and delivery by you, prior to receiving such non-public
information, of a Confidentiality Agreement in this form. Such information will
not be made available to you until your execution and return to us of this
Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you agree (on behalf of
yourself and each of your affiliates, directors, officers, employees and
representatives) that (A) such information will not be used by you except in
connection with the proposed [participation] [assignment] mentioned above and
(B) you shall use reasonable precautions, in accordance with your customary
procedures for handling confidential information and in accordance with safe and
sound banking practices, to keep such information confidential, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to your
counsel or to counsel for any of the Lenders or the Administrative Agent, (iii)
to bank examiners, auditors or accountants, or (iv) in connection with any
litigation to which you or any one or more of the Lenders is a party relating to
the transaction contemplated by the Credit Agreement; and provided that in no
event shall you be obligated to return any materials furnished to you pursuant
to this Confidentiality Agreement.
Notwithstanding anything herein to the contrary, you (and your employees,
representatives or other agents) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the transactions
contemplated by this Confidentiality Agreement (including, but not limited to,
the Credit Agreement), and all materials of any kind (including opinions or
other tax analyses) related to such tax treatment and tax structure, except that
(a) this sentence shall not apply to the extent that nondisclosure is reasonably
necessary to comply with the securities laws, and (b) this sentence shall not
permit any person to reveal the identity of the Parent or any of its
Subsidiaries.
Would you please indicate your agreement to the foregoing by signing at
the place provided below the enclosed copy of this Confidentiality Agreement.
Very truly yours,
[Insert Name of Lender]
By:
-----------------------
The foregoing is agreed to
as of the date of this letter.
[Insert name of prospective
participant or assignee]
By:
-----------------------------------------
2
SCHEDULE I
Lenders and Their Revolving Credit Commitments
Lender's Revolving Lender's Pro
Name of Lender Credit Commitment Rata Percentage
-------------- ----------------- ---------------
JPMorgan Chase Bank $20,000,000 26.6666%
Fleet National Bank $18,500,000 24.6667%
The Bank of New York $18,500,000 24.6667%
Citibank, N.A. $18,000,000 24.0%
Total Revolving Credit Commitment $75,000,000 100%
SCHEDULE II
APPLICABLE RATES
Average Debt Coverage Ratio LIBOR Loan Spread Commitment Fee Rate
--------------------------- ----------------- -------------------
Category 1
Less than or equal to 1.25 .75% .15%
Category 2
Greater than 1.25, but less than or
equal to 2.0 .90% .20%
Category 3
Greater than 2.0, but less than or
equal to 2.5 1.30% .25%
Category 4
Greater than 2.5 1.70% .35%
SCHEDULE III
Subsidiaries of Movado Group, Inc. (Section 6.9)
SUBSIDIARIES
California:
North American Watch Service Corporation
Canada:
Movado Group of Canada, Inc.
Delaware:
Movado International, Ltd.
Movado LLC
NAW Corporation
NAWC Corum Corporation
Movado Group Delaware Holdings Corporation
Germany:
Movado Deutschland X.x.x.X.
Xxxxxxx Xxxxxxxxxxx X.x.x.X.
Xxxx Xxxx:
Swissam Ltd.
Swissam Products Ltd.
Japan:
Concord Movado Japan Co., Ltd.
New Jersey:
EWC Marketing Corp.
Movado Retail Group, Inc.
Singapore:
Swissam Pte. Ltd.
Switzerland:
Concord Watch Company S.A.
Movado Watch Company SA
Montres Movado Bienne, S.A.
All issued and outstanding shares of each of the foregoing Subsidiaries are
wholly owned, directly or indirectly, by the Parent, except for statutorily
required directors qualifying shares in the case of the Hong Kong and Swiss
Subsidiaries.
2
SCHEDULE IV
Credit Arrangements (Section6.10)
SCHEDULE V
Environmental Matters (Section 6.12)
Acetone, Denatured Alcohol, Clear Ammonia, Sodium Cyanide, Xxxxxxxx Solvent
(#8052-41-3) and VM&P Naphta (#8032-32-4) are stored by Parent at 000 Xxxxx
Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx in accordance with applicable Environmental Laws.
