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Exhibit 10.3
BOWATER INCORPORATED
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BRIDGE CREDIT AGREEMENT
Dated as of July 2, 2001
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THE CHASE MANHATTAN BANK,
as Administrative Agent
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X.X. XXXXXX SECURITIES INC.,
as Co-Advisor, Co-Arranger and Co-Bookrunner
XXXXXXX SACHS CREDIT PARTNERS, L.P.,
as Co-Advisor, Co-Arranger and Co-Bookrunner
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is attached
but is inserted for convenience of reference only.
Page
Section 1. Definitions and Accounting Matters....................................................................1
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1.01 Certain Defined Terms..............................................................................1
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1.02 Accounting Terms and Determinations...............................................................12
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1.03 Types of Loans....................................................................................13
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Section 2. Commitments, Loans and Prepayments...................................................................13
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2.01 Loans.............................................................................................13
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2.02 Borrowings of Loans...............................................................................13
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2.03 [Reserved]........................................................................................13
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2.04 Changes of Commitments............................................................................13
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2.05 Facility Fee......................................................................................14
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2.06 Lending Offices...................................................................................14
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2.07 Several Obligations; Remedies Independent.........................................................14
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2.08 Loan Accounts; Promissory Notes...................................................................14
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2.09 Optional Prepayments and Conversions or Continuations of Loans....................................15
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2.10 Mandatory Prepayments.............................................................................15
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Section 3. Payments of Principal and Interest...................................................................16
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3.01 Repayment of Loans................................................................................16
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3.02 Interest..........................................................................................16
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Section 4. Payments; Pro Rata Treatment; Computations; Etc......................................................17
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4.01 Payments..........................................................................................17
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4.02 Pro Rata Treatment................................................................................17
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4.03 Computations......................................................................................18
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4.04 Minimum Amounts...................................................................................18
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4.05 Certain Notices...................................................................................18
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4.06 Non-Receipt of Funds by the Administrative Agent..................................................19
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4.07 Sharing of Payments, Etc..........................................................................20
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Section 5. Yield Protection, Etc................................................................................21
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5.01 Additional Costs..................................................................................21
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5.02 Limitation on Types of Loans......................................................................24
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5.03 Illegality........................................................................................24
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5.04 Treatment of Affected Loans.......................................................................24
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5.05 Compensation......................................................................................25
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5.06 U.S. Taxes........................................................................................26
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Section 6. [Reserved]...........................................................................................27
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Section 7. Conditions Precedent.................................................................................27
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7.01 Conditions........................................................................................27
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7.02 Additional Conditions.............................................................................29
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Section 8. Representations and Warranties.......................................................................29
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8.01 Corporate Existence...............................................................................29
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8.02 Financial Condition...............................................................................30
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8.03 Litigation........................................................................................31
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8.04 No Breach.........................................................................................31
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8.05 Action............................................................................................31
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8.06 Approvals.........................................................................................32
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8.07 Use of Credit.....................................................................................32
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8.08 ERISA; Canadian Plans.............................................................................32
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8.09 Taxes.............................................................................................32
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8.10 Investment Company Act............................................................................33
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8.11 Public Utility Holding Company Act................................................................33
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8.12 Material Agreements and Liens.....................................................................33
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8.13 Environmental Matters.............................................................................34
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8.14 Subsidiaries, Etc.................................................................................34
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8.15 True and Complete Disclosure......................................................................34
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8.16 Alliance Arrangement Agreement; Management Proxy Circular; Etc....................................35
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Section 9. Covenants of the Borrower............................................................................35
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9.01 Financial Statements, Etc.........................................................................35
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9.02 Litigation........................................................................................38
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9.03 Existence, Etc....................................................................................38
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9.04 Insurance.........................................................................................39
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9.05 Prohibition of Fundamental Changes................................................................39
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9.06 Limitation on Liens...............................................................................40
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9.07 Consolidated Net Worth............................................................................42
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9.08 Total Debt to Total Capital Ratio.................................................................42
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9.09 Transactions with Affiliates......................................................................42
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9.10 Use of Proceeds...................................................................................43
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9.11 Indebtedness......................................................................................43
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9.12 Restrictive Agreements............................................................................44
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9.13 Limitation on Lines of Business...................................................................44
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9.14 Debt Incurrence...................................................................................44
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Section 10. Events of Default...................................................................................44
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(ii)
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Section 11. The Administrative Agent............................................................................47
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11.01 Appointment, Powers and Immunities...............................................................47
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11.02 Reliance by Administrative Agent.................................................................48
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11.03 Defaults.........................................................................................48
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11.04 Rights as a Bank.................................................................................48
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11.05 Indemnification..................................................................................49
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11.06 Non-Reliance on Administrative Agent and Other Banks.............................................49
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11.07 Failure to Act...................................................................................49
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11.08 Resignation or Removal of Administrative Agent...................................................50
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Section 12. Miscellaneous.......................................................................................50
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12.01 Waiver...........................................................................................50
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12.02 Notices..........................................................................................50
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12.03 Expenses, Etc....................................................................................51
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12.04 Amendments, Etc..................................................................................52
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12.05 Successors and Assigns...........................................................................53
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12.06 Assignments and Participations...................................................................53
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12.07 Survival.........................................................................................55
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12.08 Captions.........................................................................................55
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12.09 Counterparts.....................................................................................55
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12.10 Governing Law; Submission to Jurisdiction........................................................55
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12.11 Waiver of Jury Trial.............................................................................55
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12.12 No Immunity......................................................................................56
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12.13 Judgment Currency................................................................................56
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12.14 Use of English Language..........................................................................56
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12.15 Treatment of Certain Information.................................................................57
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SCHEDULE I Commitments
SCHEDULE II Material Agreements and Liens
SCHEDULE III Subsidiaries
SCHEDULE IV Litigation
SCHEDULE V Permitted Dispositions
EXHIBIT A Form of Assignment and Acceptance
EXHIBIT B Form of Opinion of Counsel to the Borrower
EXHIBIT C Form of Opinion of Special New York Counsel to Chase
EXHIBIT D Form of Confidentiality Agreement
(iii)
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BRIDGE CREDIT AGREEMENT dated as of July 2, 2001, among: BOWATER
INCORPORATED, a corporation duly organized and validly existing under the laws
of the State of Delaware (the "Borrower"); each of the lenders that is a
signatory hereto identified under the caption "BANKS" on the signature pages
hereto or that, pursuant to Section 12.06(b) hereof, shall become a "Bank"
hereunder (individually, a "Bank" and, collectively, the "Banks"); and THE CHASE
MANHATTAN BANK, as administrative agent for the Banks (in such capacity,
together with its successors in such capacity, the "Administrative Agent").
The Borrower has requested that the Banks make loans to it in an aggregate
principal amount not exceeding $500,000,000 to finance the Alliance Arrangement
(as hereinafter defined), to refinance existing indebtedness of the Borrower and
its Subsidiaries (as so defined), and to pay fees and expenses relating thereto,
and for the general corporate purposes of the Borrower and its Subsidiaries. The
Banks are prepared to make such loans upon the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms.
As used herein, the following terms shall have the following meanings (all terms
defined in this Section 1.01 or in other provisions of this Agreement in the
singular to have the same meanings when used in the plural and vice versa):
"Administrative Questionnaire" shall mean an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" shall mean any Person that directly or indirectly controls, or
is under common control with, or is controlled by, the Borrower and, if such
Person is an individual, any member of the immediate family (including parents,
spouse, children and siblings) of such individual and any trust whose principal
beneficiary is such individual or one or more members of such immediate family
and any Person who is controlled by any such member or trust. As used in this
definition, "control" (including, with its correlative meanings, "controlled by"
and "under common control with") shall mean possession, directly or indirectly,
of power to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership interests, by
contract or otherwise); provided that, in any event, any Person that owns
directly or indirectly securities having 10% or more of the voting power for the
election of directors or other governing body of a corporation or 10% or more of
the partnership or other ownership interests of any other Person (other than as
a limited partner of such other Person) will be deemed to control such
corporation or other Person. Notwithstanding the foregoing, (a) no individual
shall be an Affiliate solely by reason of his or her being a director, officer
or employee of the Borrower or any of its Subsidiaries and (b) none of the
Subsidiaries of the Borrower shall be Affiliates.
"Alliance" shall mean Alliance Forest Products Inc., a corporation existing
under the laws of Canada.
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"Alliance Arrangement" shall mean the arrangement in respect of Alliance
and its shareholders under the provisions of Section 192 of the Canada Business
Corporations Act, R.S.C. 1985, c. C-44, as amended, on the terms and conditions
set forth in the Plan of Arrangement under and as defined in the Alliance
Arrangement Agreement.
"Alliance Arrangement Agreement" shall mean the Arrangement Agreement dated
as of April 1, 2001 between the Borrower and Alliance.
"Applicable Lending Office" shall mean, for each Bank and for each Type of
Loan, the "Lending Office" of such Bank (or of an affiliate of such Bank) as
such Bank may from time to time specify to the Administrative Agent and the
Borrower as the office by which its Loans of such Type are to be made and
maintained.
"Applicable Margin" shall mean: (a) with respect to Base Rate Loans,
0.0000% per annum, except that during any Level V Period the rate shall be
0.2500%; and (b) with respect to Eurodollar Loans, the rate for such Loan for
each rating level period set forth in the schedule below:
Rating Eurodollar Loans
Level I Period 0.5650%
Level II Period 0.6700%
Level III Period 0.7750%
Level IV Period 0.8750%
Level V Period 1.3000%
Notwithstanding the foregoing, the Applicable Margin for Eurodollar Loans shall
be increased by 0.2000% per annum for each rating level period from and after
January 1, 2002. Any change in the Applicable Margin for any Loan by reason of a
change in the Standard & Poor's Rating or the Xxxxx'x Rating shall become
effective on the date two Business Days after the announcement or publication by
the respective rating agencies of a change in such rating or, in the absence of
such announcement or publication, two Business Days after the effective date of
such changed rating.
"Arranger" shall mean X.X. Xxxxxx Securities Inc.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of 1978, as amended
from time to time, presently codified as Title 11 of the United States Code.
"Base Rate" shall mean, for any day, a rate per annum equal to the higher
of (a) the Federal Funds Rate for such day plus 1/2 of 1% and (b) the Prime Rate
for such day. Each change in any interest rate provided for herein based upon
the Base Rate resulting from a change in the Base Rate shall take effect at the
time of such change in the Base Rate.
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"Base Rate Loans" shall mean Loans that bear interest at rates based upon
the Base Rate.
"Business Day" shall mean (a) any day on which commercial banks are not
authorized or required to close in New York City and (b) if such day relates to
a borrowing of, a payment or prepayment of principal of or interest on, a
Conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice
by the Borrower with respect to any such borrowing, payment, prepayment,
Conversion or Interest Period, any day on which dealings in Dollar deposits are
carried out in the London interbank market.
"Canadian Plan" shall mean any plan, program, practice, arrangement or
policy, whether registered or unregistered, written or unwritten, funded or
unfunded, insured or uninsured, that is maintained, administered or contributed
to by the Borrower or any of its Subsidiaries (or under which the Borrower or
any Subsidiary has or may have any obligation) in respect of employees or former
employees in Canada (or their spouses, beneficiaries or dependents), and
relating to: pensions, supplemental pensions, retirement or retirement savings,
profit sharing or deferred profit sharing, deferred or incentive compensation,
bonuses, death benefits, life or disability insurance, medical or dental
insurance or benefits or other similar employee benefits.
"Capital Lease Obligations" shall mean, for any Person, all obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP (including Statement of Financial Accounting Standards No. 13
of the Financial Accounting Standards Board), and, for purposes of this
Agreement, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP (including such Statement No. 13).
"Casualty Event" shall mean, with respect to any Property of any Person,
any loss of or damage to, or any condemnation or other taking of, such Property
for which such Person or any of its Subsidiaries receives insurance proceeds, or
proceeds of a condemnation award or other compensation.
"Chase" shall mean The Chase Manhattan Bank.
"Closing Date" shall mean the date on which this Agreement shall have been
executed and delivered by all parties hereto.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Commitment" shall mean, for each Bank, the obligation of such Bank to make
Loans on the Effective Date in an aggregate amount up to but not exceeding (a)
in the case of a Bank that is a party to this Agreement on the date hereof, the
amount set opposite the name of such Bank on Schedule I hereto under the caption
"Commitment" or (b) in the case of any other Bank, the aggregate amount of the
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Commitments of other Banks acquired by it pursuant to Section 12.06(b) hereof
(in each case, as the same may be reduced from time to time pursuant to Section
2.04 hereof or increased or reduced pursuant to said Section 12.06(b)). The
original aggregate principal amount of the Commitments is $500,000,000.
"Consolidated Subsidiary" shall mean, for any Person, each Subsidiary of
such Person (whether now existing or hereafter created or acquired) the
financial statements of which shall be (or should have been) consolidated with
the financial statements of such Person in accordance with GAAP.
"Consolidated Net Worth" shall mean, as at any date, the sum, for the
Borrower and its Consolidated Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), of the following:
(a) the amount of common stock, plus
(b) the amount of any Preferred Stock, plus
(c) the amount of additional paid-in capital and retained earnings
(or, in the case of an additional paid-in capital or retained earnings
deficit, minus the amount of such deficit), plus
(d) equity adjustments from foreign currency translations (or, in the
case of negative adjustments, minus the amount of such adjustments), it
being understood that such adjustments are to be recharacterized in
accordance with FASB Statement No. 130 as accumulated other comprehensive
income (or deficit), minus
(e) the unpaid principal amount of the loan to the Borrower's Employee
Stock Ownership Plan (ESOP), minus
(f) the cost of treasury stock.
"Continue", "Continuation" and "Continued" shall refer to the continuation
pursuant to Section 2.09 hereof of a Eurodollar Loan from one Interest Period to
the next Interest Period.
"Convert", "Conversion" and "Converted" shall refer to a conversion
pursuant to Section 2.09 hereof of one Type of Loans into another Type of Loans,
which may be accompanied by the transfer by a Bank (at its sole discretion) of a
Loan from one Applicable Lending Office to another.
"Debt Incurrence" shall mean the incurrence by the Borrower or any
Subsidiary of the Borrower after the Closing Date of Indebtedness in respect of
bonds, debentures, notes or similar instruments, excluding, however, (a) any
Indebtedness incurred under the Existing Credit Agreement, or the Five-Year
Credit Agreement dated as of June 24, 1998 between the Borrower, the Lenders
named therein and The Chase Manhattan Bank, as Administrative Agent, (b) any
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Indebtedness referred to in clause (i) of Section 9.11(b) hereof and (c) any
Indebtedness incurred by Bowater Maritimes Inc. under its existing bank credit
facility providing for borrowings in an aggregate amount up to Cdn.$63,700,000.
"Default" shall mean an Event of Default or an event that with notice or
lapse of time or both would become an Event of Default.
"Disposition" shall mean any sale, assignment, transfer or other
disposition of any Property (whether now owned or hereafter acquired) by the
Borrower or any of its Subsidiaries to any other Person excluding any sale,
assignment, transfer or other disposition of any Property sold or disposed of in
the ordinary course of business and on ordinary business terms.
"Dollars" and "$" shall mean lawful money of the United States of America.
"Effective Date" shall mean the date on which the conditions specified in
Section 7 are satisfied (or waived in accordance with Section 12.04).
"Environmental Laws" shall mean any and all present and future Federal,
state, local and foreign laws, rules and regulations, and any orders or decrees,
in each case as now or hereafter in effect, relating to the regulation or
protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the indoor or outdoor
environment, including, without limitation, ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.
"Equity Rights" shall mean, with respect to any Person, any outstanding
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including, without limitation, any stockholders' or voting trust
agreements) for the issuance, sale, registration or voting of, or outstanding
securities convertible into, any additional shares of capital stock of any
class, or partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business that is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which the Borrower is a member and (ii) 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
Borrower is a member.
"Eurodollar Loans" shall mean Loans the interest rates on which are
determined on the basis of rates referred to in the definition of "Fixed Base
Rate" in this Section 1.01.
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"Event of Default" shall have the meaning assigned to such term in Section
10 hereof.
"Existing Credit Agreement" shall mean the 364-Day Credit Agreement dated
as of June 24, 1998 among the Borrower, each of the lenders party thereto and
Chase as agent for such lenders, as supplemented and amended from time to time
and in effect on the date hereof.
"Federal Funds Rate" shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (a) if the day for which such rate is to be determined is not
a Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day and (b) if such rate is not so published for any
Business Day, the Federal Funds Rate for such Business Day shall be the average
rate charged to Chase on such Business Day on such transactions as determined by
the Administrative Agent.
"Fixed Base Rate" shall mean, with respect to any Eurodollar Loan for any
Interest Period therefor, the rate per annum appearing on Page 3750 of the Dow
Xxxxx Markets Telerate Service (or on any successor or substitute page of such
Service, or any successor to or substitute for such Service, providing rate
quotations comparable to those currently provided on such page of such Service,
as determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to Dollar deposits in the
London interbank market) at approximately 11:00 a.m. London time on the date two
Business Days prior to the first day of such Interest Period as the rate for
Dollar deposits having a term comparable to such Interest Period, provided that
if such rate does not appear on such page, or if such page shall cease to be
publicly available, or if the information contained on such page, in the
reasonable judgment of the Majority Banks, shall cease accurately to reflect the
rate offered by leading banks in the London interbank market as reported by any
publicly available source of similar market data selected by the Majority Banks,
the Fixed Base Rate shall mean, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the nearest 1/16 of 1%) quoted by Chase at
approximately 11:00 a.m. London time (or as soon thereafter as practicable) two
Business Days prior to the first day of such Interest Period for the offering by
Chase to leading banks in the London interbank market of Dollar deposits having
a term comparable to such Interest Period and in the amount of the Eurodollar
Loan to be made by Chase for such Interest Period. If Chase is not participating
in any Eurodollar Loan during any Interest Period therefor, the Fixed Base Rate
for such Interest Period shall be determined by reference to the amount of such
Loan that Chase would have made or had outstanding during such Interest Period
had it been participating in such Loan during such Interest Period.
"GAAP" shall mean generally accepted accounting principles of the United
States of America applied on a basis consistent with those which, in accordance
with the last sentence of Section 1.02(a) hereof, are to be used in making the
calculations for purposes of determining compliance with this Agreement.
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"Guarantee" shall mean a guarantee, an endorsement, a contingent agreement
to purchase or to furnish funds for the payment or maintenance of, or otherwise
to be or become contingently liable under or with respect to, the Indebtedness,
other obligations, net worth, working capital or earnings of any Person, or a
guarantee of the payment of dividends or other distributions upon the stock or
equity interests of any Person, or an agreement to purchase, sell or lease (as
lessee or lessor) Property, products, materials, supplies or services primarily
for the purpose of enabling a debtor to make payment of such debtor's
obligations or an agreement to assure a creditor against loss, and including,
without limitation, causing a bank or other financial institution to issue a
letter of credit or other similar instrument for the benefit of another Person,
but excluding endorsements for collection or deposit in the ordinary course of
business. The terms "Guarantee" and "Guaranteed" used as a verb shall have a
correlative meaning.
"Indebtedness" shall mean, for any Person: (a) obligations created, issued
or incurred by such Person for borrowed money (whether by loan, the issuance and
sale of debt securities or the sale of Property to another Person subject to an
understanding or agreement, contingent or otherwise, to repurchase such Property
from such Person); (b) obligations of such Person to pay the deferred purchase
or acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business, so long as such trade accounts payable are payable
within 90 days of the date the respective goods are delivered or the respective
services are rendered; (c) Indebtedness of others secured by a Lien on the
Property of such Person, whether or not the respective Indebtedness so secured
has been assumed by such Person; (d) obligations (contingent or otherwise) of
such Person in respect of letters of credit or similar instruments issued or
accepted by banks and other financial institutions for account of such Person;
(e) Capital Lease Obligations of such Person; and (f) Indebtedness of others
Guaranteed by such Person.
"Interest Period" shall mean, with respect to any Eurodollar Loan, each
period commencing on the date such Eurodollar Loan is made or Converted from a
Loan of another Type or the last day of the next preceding Interest Period for
such Loan and ending on the numerically corresponding day in the first, second,
third or sixth calendar month thereafter, or (subject to the agreement by each
Lender in its sole discretion at the time such duration is selected by the
Borrower, two weeks thereafter) as the Borrower may select as provided in
Section 4.05 hereof, except that each Interest Period that commences on the last
Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period for any Eurodollar
Loan would otherwise end after the Maturity Date, such Interest Period shall end
on the Maturity Date; (ii) each Interest Period that would otherwise end on a
day that is not a Business Day shall end on the next succeeding Business Day
(or, if such next succeeding Business Day falls in the next succeeding calendar
month, on the next preceding Business Day); and (iii) notwithstanding clause (i)
above, except to the extent otherwise agreed by each Lender as provided above,
no Interest Period for any Loan shall have a duration of less than one month
and, if the Interest Period for any Eurodollar Loan would otherwise be a shorter
period, such Loan shall not be available hereunder for such period.
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"Interest Rate Protection Agreement" shall mean, for any Person, an
interest rate swap, cap or collar agreement or similar arrangement between such
Person and one or more financial institutions providing for the transfer or
mitigation of interest risks either generally or under specific contingencies.
"Investment" shall mean, for any Person: (a) the acquisition (whether for
cash, Property, services or securities or otherwise) of capital stock, bonds,
notes, debentures, partnership or other ownership interests or other securities
of any other Person or any agreement to make any such acquisition (including,
without limitation, any "short sale" or any sale of any securities at a time
when such securities are not owned by the Person entering into such short sale);
(b) the making of any deposit with, or advance, loan or other extension of
credit to, any other Person (including the purchase of Property from another
Person subject to an understanding or agreement, contingent or otherwise, to
resell such Property to such Person, but excluding any such advance, loan or
extension of credit having a term not exceeding 90 days representing the
purchase price of inventory or supplies sold by such Person in the ordinary
course of business); (c) the entering into of any Guarantee of, or other
contingent obligation with respect to, Indebtedness or other liability of any
other Person and (without duplication) any amount committed to be advanced, lent
or extended to such Person; or (d) the entering into of any Interest Rate
Protection Agreement.
"Level I Period" shall mean any period during which (a) no Event of Default
has occurred and is continuing and (b) the Standard & Poor's Rating is at or
above A- (or any successor rating) or the Xxxxx'x Rating is at or above A3 (or
any successor rating).
"Level II Period" shall mean any period, other than a Level I Period,
during which (a) no Event of Default has occurred and is continuing and (b) the
Standard & Poor's Rating is at or above BBB+ (or any successor rating) or the
Xxxxx'x Rating is at or above Baa1 (or any successor rating).
"Level III Period" shall mean any period, other than a Level I Period or a
Level II Period, during which (a) no Event of Default has occurred and is
continuing and (b) the Standard & Poor's Rating is at or above BBB (or any
successor rating) or the Xxxxx'x Rating is at or above Baa2 (or any successor
rating).
"Level IV Period" shall mean any period, other than a Level I Period, a
Level II Period or a Level III Period, during which (a) no Event of Default has
occurred and is continuing and (b) the Standard & Poor's Rating is at or above
BBB- (or any successor rating) or the Xxxxx'x Rating is at or above Baa3 (or any
successor rating).
"Level V Period" shall mean any period that is not a Level I Period, a
Level II Period, a Level III Period or a Level IV Period.
"Lien" shall mean, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Agreement, a Person shall be deemed to own
subject to a Lien any Property that it has acquired or holds subject to the
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interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement (other than an operating lease)
relating to such Property.
"Loans" shall mean Base Rate Loans and Eurodollar Loans.
"Majority Banks" shall mean Banks having more than 50% of the aggregate
amount of the Commitments or, if the Commitments shall have terminated, Banks
holding more than 50% of the aggregate unpaid principal amount of the Loans.
"Management Proxy Circular" shall mean the Notice of Annual Meeting of
Shareholders and Management Proxy Circular of Alliance, dated May 25, 2001,
including all exhibits thereto, in each case as originally in effect and without
giving effect to any modifications thereof after the date hereof.
"Margin Stock" shall mean "margin stock" within the meaning of Regulations
U and X.
"Material Adverse Effect" shall mean a material adverse effect on (a) the
Property, business, operations, financial condition, liabilities or
capitalization of the Borrower and its Subsidiaries taken as a whole, (b) the
ability of the Borrower to perform its obligations hereunder, (c) the validity
or enforceability of this Agreement, (d) the rights and remedies of the Banks
and the Administrative Agent hereunder, (e) the timely payment of the principal
of or interest on the Loans or other amounts payable in connection therewith, or
(f) the Alliance Arrangement.
"Material Indebtedness" shall mean Indebtedness (other than the Loans), or
obligations in respect of one or more Interest Rate Protection Agreements, of
the Borrower and its Subsidiaries in an aggregate principal amount exceeding
$50,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of any Person in respect of any Interest Rate
Protection Agreement at any time shall be the maximum aggregate amount (giving
effect to any netting requirements) that such Person would be required to pay if
such Interest Rate Protection Agreement were terminated at such time.
"Maturity Date" shall mean the earlier to occur of (a) the date nine months
after the Closing Date and (b) April 30, 2002.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. or any successor
corporation thereto.
"Xxxxx'x Rating" shall mean, at any time, the then current rating
(including the failure to rate) by Moody's of the Borrower's senior unsecured
long term public debt.
"Multiemployer Plan" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been made by the Borrower or
any ERISA Affiliate and which is covered by Title IV of ERISA.
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"PBGC" shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, joint venture, trust, unincorporated organization or
government (or any agency, instrumentality or political subdivision thereof).
"Plan" shall mean an employee benefit or other plan established or
maintained by the Borrower or any ERISA Affiliate and that is covered by Title
IV of ERISA, other than a Multiemployer Plan.
"Ponderay" shall mean Ponderay Newsprint Company, a partnership existing
under the laws of the State of Washington.
"Post-Default Rate" shall mean, in respect of any principal of any Loan or
any other amount under this Agreement that is not paid when due (whether at
stated maturity, by acceleration or otherwise), a rate per annum during the
period from and including the due date to but excluding the date on which such
amount is paid in full equal to 2% plus the Base Rate as in effect from time to
time plus the Applicable Margin (if any) for Base Rate Loans (provided that, if
the amount so in default is principal of a Eurodollar Loan and the due date
thereof is a day other than the last day of the Interest Period therefor, the
"Post-Default Rate" for such principal shall be, for the period from and
including such due date to but excluding the last day of such Interest Period,
2% plus the interest rate for such Loan as provided in Section 3.02 hereof and,
thereafter, the rate provided for above in this definition).
"Preferred Stock" shall mean any preferred stock hereafter issued by the
Borrower that does not have any requirement for the Borrower to purchase,
redeem, retire or otherwise acquire the same on or before the Maturity Date.
"Prime Rate" shall mean the rate of interest from time to time announced by
Chase at its principal office as its prime commercial lending rate.
"Property" shall mean any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
"Quarterly Dates" shall mean the quarterly anniversaries of the Closing
Date; provided that, if any such date is not a Business Day, the respective
Quarterly Date shall be the next preceding Business Day.
"Regulations A, D, U and X" shall mean, respectively, Regulations A, D, U
and X of the Board of Governors of the Federal Reserve System (or any
successor), as the same may be modified and supplemented and in effect from time
to time.
"Regulatory Change" shall mean, with respect to any Bank, any change after
the date of this Agreement in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Bank of or under any Federal, state or foreign law or
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regulations (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"Reserve Requirement" shall mean, for any Interest Period for any
Eurodollar Loan, the average maximum rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member banks of the
Federal Reserve System in New York City with deposits exceeding one billion
Dollars against "Eurocurrency liabilities" (as such term is used in Regulation
D). Without limiting the effect of the foregoing, the Reserve Requirement shall
include any other reserves required to be maintained by such member banks by
reason of any Regulatory Change with respect to (i) any category of liabilities
that includes deposits by reference to which the Fixed Base Rate for Eurodollar
Loans is to be determined as provided in the definition of "Fixed Base Rate" in
this Section 1.01 or (ii) any category of extensions of credit or other assets
that includes Eurodollar Loans.
"Standard & Poor's" shall mean Standard & Poor's Ratings Group, a division
of McGraw Hill, Inc., or any successor corporation thereto.
"Standard & Poor's Rating" shall mean, at any time, the then current rating
(including the failure to rate) by Standard & Poor's of the Borrower's senior
unsecured long term public debt.
"Subsidiary" shall mean, for any Person, any corporation, partnership or
other entity of which at least a majority of the securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of
such Person or by such Person and one or more Subsidiaries of such Person.
"Wholly Owned Subsidiary" shall mean any such corporation, partnership or other
entity of which all of the equity securities or other ownership interests (other
than, in the case of a corporation, directors' qualifying shares) are so owned
or controlled.
"Total Assets" shall mean, at any time, the aggregate book value of all of
the assets of the Borrower and its Consolidated Subsidiaries at such time
determined on a consolidated basis (without duplication) in accordance with
GAAP.
"Total Capital" shall mean, at any time, Consolidated Net Worth plus Total
Debt.
"Total Debt" shall mean, at any time, the aggregate outstanding principal
amount of all Indebtedness of the Borrower and its Consolidated Subsidiaries at
such time determined on a consolidated basis (without duplication) in accordance
with GAAP to the extent required to be reflected on a balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP; provided that
the term "Total Debt" shall include any preferred stock that does not qualify as
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Preferred Stock, but shall not include Indebtedness in respect of commercial
documentary letters of credit.
"Type" shall have the meaning assigned to such term in Section 1.03 hereof.
1.02 Accounting Terms and Determinations.
(a) Accounting Principles. Except as otherwise expressly provided herein,
all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be
delivered to the Banks hereunder shall (unless otherwise disclosed to the Banks
in writing at the time of delivery thereof in the manner described in subsection
(b) below) be prepared, in accordance with generally accepted accounting
principles of the United States of America applied on a basis consistent with
those used in the preparation of the latest financial statements furnished to
the Banks hereunder (which, prior to the delivery of the first financial
statements under Section 9.01 hereof, shall mean the audited financial
statements as at December 31, 2000 referred to in Section 8.02 hereof). All
calculations made for the purposes of determining compliance with this Agreement
shall (except as otherwise expressly provided herein) be made by application of
generally accepted accounting principles of the United States of America applied
on a basis consistent with those used in the preparation of the latest annual or
quarterly financial statements furnished to the Banks pursuant to Section 9.01
hereof (or, prior to the delivery of the first financial statements under
Section 9.01 hereof, used in the preparation of the audited financial statements
as at December 31, 2000 referred to in Section 8.02 hereof) unless (i) the
Borrower shall have objected to determining such compliance on such basis at the
time of delivery of such financial statements or (ii) the Majority Banks shall
so object in writing within 30 days after delivery of such financial statements,
in either of which events such calculations shall be made on a basis consistent
with those used in the preparation of the latest financial statements as to
which such objection shall not have been made (which, if objection is made in
respect of the first financial statements delivered under Section 9.01 hereof,
shall mean the audited financial statements as at December 31, 2000 referred to
in Section 8.02 hereof).
(b) Statement of Variations in Accounting Principles. The Borrower shall
deliver to the Banks at the same time as the delivery of any annual or quarterly
financial statement under Section 9.01 hereof (i) a description in reasonable
detail of any material variation between the application of accounting
principles employed in the preparation of such statement and the application of
accounting principles employed in the preparation of the next preceding annual
or quarterly financial statements as to which no objection has been made in
accordance with the last sentence of subsection (a) above and (ii) reasonable
estimates of the difference between such statements arising as a consequence
thereof.
(c) Changes in Fiscal Year. To enable the ready and consistent
determination of compliance with the covenants set forth in Section 9 hereof,
the Borrower will not change the last day of its fiscal year from December 31 of
each year, or the last days of the first three fiscal quarters in each of its
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fiscal years from March 31, June 30 and September 30 of each year, respectively
without the consent of the Majority Banks, such consent not to be unreasonably
withheld.
1.03 Types of Loans.
Loans hereunder are distinguished by "Type". The "Type" of a Loan refers to
whether such Loan is a Base Rate Loan or a Eurodollar Loan, each of which
constitutes a Type. Loans may be identified by Type.
Section 2. Commitments, Loans and Prepayments.
2.01 Loans.
Each Bank severally agrees, on the terms and conditions of this Agreement,
to make one or more term loans to the Borrower in Dollars on the Effective Date
in an aggregate principal amount up to but not exceeding the amount of the
Commitment of such Bank. Thereafter the Borrower may Convert Loans of one Type
into Loans of another Type (as provided in Section 2.09 hereof) or Continue
Loans of one Type as Loans of the same Type (as provided in Section 2.09
hereof); provided that no more than fifteen different Interest Periods for Loans
may be outstanding at the same time. Amounts prepaid or repaid in respect of
Loans may not be reborrowed.
2.02 Borrowings of Loans.
The Borrower shall give the Administrative Agent (which shall promptly
notify the Banks) notice of each borrowing hereunder to be made to the Borrower
as provided in Section 4.05 hereof. Not later than 1:00 p.m. New York time on
the date specified for each borrowing of Loans hereunder, each Bank shall make
available the amount of the Loan or Loans to be made by it on such date to the
Administrative Agent, at an account designated by the Administrative Agent to
the Banks, in immediately available funds, for account of the Borrower. The
amount so received by the Administrative Agent shall, subject to the terms and
conditions of this Agreement, be made available to the Borrower, in immediately
available funds, to such account as it shall specify to the Administrative
Agent.
2.03 [Reserved].
2.04 Changes of Commitments.
(a) Reduction of Commitments. The aggregate amount of the Commitments shall
be automatically reduced to zero at the close of business on the Effective Date.
(b) Notice; Minimum Amount. The Borrower shall have the right at any time
or from time to time (i) so long as no Loans are outstanding, to terminate the
Commitments and (ii) to reduce the aggregate unused amount of the Commitments;
provided that (x) the Borrower shall give notice of each such termination or
reduction as provided in Section 4.05 hereof and (y) each partial reduction
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shall be in an aggregate amount at least equal to $5,000,000 and in integral
multiples of $5,000,000 in excess thereof.
(c) Termination or Reduction Irrevocable. The Commitments once terminated
or reduced may not be reinstated.
2.05 Facility Fee.
The Borrower shall pay to the Administrative Agent for account of each Bank
a facility fee on the amount of such Bank's original Commitment, for the period
from and including the date of this Agreement to but not including the Maturity
Date, at a rate per annum equal to (a) 0.0600% during any Level I Period, (b)
0.0800% during any Level II Period, (c) 0.1000% during any Level III Period, (d)
0.1250% during any Level IV Period and (e) 0.2000% during any Level V Period,
provided that the facility fee shall be increased by 0.0500% per annum for each
rating level period from and after January 1, 2002. Accrued facility fee shall
be payable on each Quarterly Date and on the Maturity Date. Any change in a
facility fee by reason of a change in the Standard & Poor's Rating or the
Xxxxx'x Rating shall become effective on the date two Business Days after the
date of announcement or publication by the respective rating agencies of a
change in such rating or, in the absence of such announcement or publication, on
the date two Business Days after the effective date of such changed rating.
2.06 Lending Offices.
The Loans of each Type made by each Bank shall be made and maintained at
such Bank's Applicable Lending Office for Loans of such Type.
2.07 Several Obligations; Remedies Independent.
The failure of any Bank to make any Loan to be made by it on the date
specified therefor shall not relieve any other Bank of its obligation to make
its Loan on such date, but neither any Bank nor the Administrative Agent shall
be responsible for the failure of any other Bank to make a Loan to be made by
such other Bank, and no Bank shall have any obligation to the Administrative
Agent or any other Bank for the failure by such Bank to make any Loan required
to be made by such Bank. The amounts payable by the Borrower at any time
hereunder to each Bank shall be a separate and independent debt and each Bank
shall be entitled to protect and enforce its rights arising out of this
Agreement, and it shall not be necessary for any other Bank or the
Administrative Agent to consent to, or be joined as an additional party in, any
proceedings for such purposes.
2.08 Loan Accounts; Promissory Notes.
(a) Maintenance of Loan Accounts by Banks. Each Bank shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Bank resulting from each Loan made by such
Bank to the Borrower, including the amounts of principal and interest payable
and paid to such Bank by the Borrower from time to time hereunder.
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(b) Maintenance of Loan Accounts by Administrative Agent. The
Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder to the Borrower, the Type thereof and, in the
case of a Eurodollar Loan, the Interest Period applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and payable
to each Bank from the Borrower hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder from the Borrower for the account
of the Banks and each Bank's share thereof.
(c) Effect of Entries. The entries made in the accounts maintained pursuant
to paragraph (a) or (b) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein absent any manifest
arithmetical error in such accounts; provided that the failure of any Bank or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrower to repay the Loans in
accordance with the terms of this Agreement.
(d) Promissory Notes. Any Bank may request that Loans made by it to the
Borrower be evidenced by a promissory note. In such event, the Borrower shall
prepare, execute and deliver to such Bank a promissory note payable to the order
of such Bank (or, if requested by such Bank, such Bank and its registered
assigns) and in a form approved by the Administrative Agent. Thereafter, the
Loans of the Borrower evidenced by such promissory note and interest thereon
shall at all times (including after assignment pursuant to Section 12.06 hereof)
be represented by one or more promissory notes in such form payable to the order
of the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).
2.09 Optional Prepayments and Conversions or Continuations of Loans.
Subject to Sections 4.04 and 5 hereof, the Borrower shall have the right to
prepay Loans, or to Convert Loans of one Type into Loans of another Type or
Continue Loans of one Type as Loans of the same Type, at any time or from time
to time, provided that the Borrower shall give the Administrative Agent notice
of each such prepayment, Conversion or Continuation as provided in Section 4.05
hereof (and, upon the date specified in any such notice of prepayment, the
amount to be prepaid shall become due and payable hereunder). Notwithstanding
the foregoing, and without limiting the rights and remedies of the Banks under
Section 10 hereof, in the event that any Event of Default shall have occurred
and be continuing, the Administrative Agent may (and at the request of the
Majority Banks shall) suspend the right of the Borrower to Convert any Loan into
a Eurodollar Loan, or to Continue any Loan as a Eurodollar Loan, in which event
all Loans shall be Converted (on the last day(s) of the respective Interest
Periods therefor) or Continued, as the case may be, as Base Rate Loans.
2.10 Mandatory Prepayments.
Upon any Debt Incurrence, the Borrower shall prepay the Loans, or the
Commitments shall be subject to automatic reduction, on the date of such Debt
Incurrence in an aggregate amount equal to 100% of the gross proceeds thereof,
such prepayment or reduction to be applied to reduce the aggregate amount of the
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Commitments and to the extent that, after giving effect to such reduction, the
aggregate principal amount of the Loans would exceed the Commitments, the
Borrower shall prepay Loans in an aggregate amount equal to such excess,
provided that if the aggregate amount of the gross proceeds of such Debt
Incurrence, together with the aggregate amount of the gross proceeds of all
other Debt Incurrences after the date hereof, shall be greater than or equal to
$350,000,000 then, upon the occurrence of such latest Debt Incurrence, the
Borrower shall prepay the Loans in full.
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loans.
The Borrower hereby promises to pay to the Administrative Agent for account
of each Bank the principal of such Bank's Loans to the Borrower on the Maturity
Date.
3.02 Interest.
The Borrower hereby promises to pay to the Administrative Agent for account
of each Bank interest on the unpaid principal amount of each Loan made by such
Bank to the Borrower for the period from and including the date of such Loan to
but excluding the date such Loan shall be paid in full, at the following rates
per annum:
(a) during such periods as such Loan is a Base Rate Loan, the Base
Rate (as in effect from time to time) plus the Applicable Margin (if any);
and
(b) during such periods as such Loan is a Eurodollar Loan, for each
Interest Period relating thereto, the Fixed Base Rate for such Loan for
such Interest Period plus the Applicable Margin.
Notwithstanding the foregoing, the Borrower hereby promises to pay to the
Administrative Agent for account of each Bank interest at the applicable
Post-Default Rate on any principal of any Loan made by such Bank to the Borrower
and on any other amount payable by the Borrower hereunder held by such Bank to
or for account of such Bank, which shall not be paid in full when due (whether
at stated maturity, by acceleration or otherwise), for the period from and
including the due date thereof to but excluding the date the same is paid in
full. Accrued interest on each Loan shall be payable (i) in the case of a Base
Rate Loan, quarterly on the Quarterly Dates, (ii) in the case of a Eurodollar
Loan, on the last day of each Interest Period therefor and, if such Interest
Period is longer than three months, at three-month intervals following the first
day of such Interest Period, and (iii) in the case of any Loan, upon the payment
or prepayment thereof or the Conversion of such Loan to a Loan of another Type
(but only on the principal amount so paid, prepaid or Converted), except that
interest payable at the Post-Default Rate shall be payable from time to time on
demand of the Bank for whose account such interest is payable. Promptly after
the determination of any interest rate provided for herein or any change
therein, the Administrative Agent shall give notice thereof to the Banks to
which such interest is payable and to the Borrower.
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Section 4. Payments; Pro Rata Treatment; Computations; Etc.
4.01 Payments.
(a) Payment to the Administrative Agent. Except to the extent otherwise
provided herein, all payments of principal, interest and other amounts to be
made by the Borrower under this Agreement shall be made in Dollars, in
immediately available funds, without deduction, set-off or counterclaim, to the
Administrative Agent at an account designated by the Administrative Agent to the
Borrower, not later than 1:00 p.m. New York time on the date on which such
payment shall become due (each such payment made after such time on such due
date to be deemed to have been made on the next succeeding Business Day).
(b) Designation of Payee. The Borrower shall, at the time of making each
payment under this Agreement for account of any Bank, specify to the
Administrative Agent (which shall so notify the intended recipient(s) thereof)
the Loans or other amounts payable by the Borrower hereunder to which such
payment is to be applied (and in the event that the Borrower fails to so
specify, or if an Event of Default has occurred and is continuing, the
Administrative Agent may distribute such payment to the Banks for application in
such manner as the Majority Banks, subject to Section 4.02 hereof, may determine
to be appropriate).
(c) Payment of Banks. Each payment received by the Administrative Agent
under this Agreement for account of any Bank shall be paid by the Administrative
Agent promptly to such Bank, in immediately available funds, for account of such
Bank's Applicable Lending Office for the Loan or other obligation in respect of
which such payment is made.
(d) Due Date. If the due date of any payment under this Agreement would
otherwise fall on a day that is not a Business Day, such date shall be extended
to the next succeeding Business Day, and interest shall be payable on any
principal so extended for the period of such extension.
4.02 Pro Rata Treatment.
Except to the extent otherwise provided herein: (a) each borrowing of Loans
under Section 2.01 hereof shall be made from the Banks, each payment of facility
fee under Section 2.05 hereof shall be made for account of the Banks, and each
termination or reduction of the amount of the Commitments under Section 2.04
hereof shall be applied to the respective Commitments of the Banks, pro rata
according to the amounts of their respective Commitments; (b) the making,
Conversion and Continuation of Loans of a particular Type (other than
Conversions provided for by Section 5.04 hereof) shall be made pro rata among
the Banks according to the amounts of their respective Commitments (in the case
of making of Loans) or their respective Loans (in the case of Conversions and
Continuations of Loans), and the then current Interest Period for each Loan of
such Type shall be coterminous; (c) each payment or prepayment of principal of
Loans by the Borrower shall be made for account of the Banks pro rata in
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accordance with the respective unpaid principal amounts of the Loans held by
them; and (d) each payment of interest on Loans by the Borrower shall be made
for account of the Banks pro rata in accordance with the amounts of interest on
such Loans then due and payable to the respective Banks.
4.03 Computations.
Interest on Eurodollar Loans and facility fee shall be computed on the
basis of a year of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable and interest
on Base Rate Loans shall be computed on the basis of a year of 365 or 366 days,
as the case may be, and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable.
Notwithstanding the foregoing, for each day that the Base Rate is calculated by
reference to the Federal Funds Rate, interest on Base Rate Loans shall be
computed on the basis of a year of 360 days and actual days elapsed.
4.04 Minimum Amounts.
Except for Conversions or prepayments made pursuant to Section 2.10 and
Section 5.04 hereof, each borrowing, Conversion and partial prepayment of
principal of Loans shall be in an aggregate amount at least equal to $5,000,000
or in integral multiples of $1,000,000 in excess thereof (borrowings,
Conversions or prepayments of or into Loans of different Types or, in the case
of Eurodollar Loans, having different Interest Periods at the same time
hereunder to be deemed separate borrowings, Conversions and prepayments for
purposes of the foregoing, one for each Type or Interest Period). Anything in
this Agreement to the contrary notwithstanding, the aggregate principal amount
of Eurodollar Loans having the same Interest Period shall be in an amount at
least equal to $5,000,000 or in integral multiples of $1,000,000 in excess
thereof and, if any Eurodollar Loans would otherwise be in a lesser principal
amount for any period, such Loans shall be Base Rate Loans during such period.
4.05 Certain Notices.
Notices to the Administrative Agent by the Borrower of terminations or
reductions of the Commitments, and by the Borrower of borrowings, Conversions,
Continuations and prepayments of Loans, of Types of Loans and of the duration of
Interest Periods, shall be irrevocable and shall be effective only if received
by the Administrative Agent not later than 11:00 a.m. New York time on the
number of Business Days prior to the date of the relevant termination,
reduction, borrowing, Conversion, Continuation or prepayment or the first day of
such Interest Period specified below:
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Number of
Business
Notice Days Prior
------ ----------
Termination or reduction
of Commitments 3
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans same day
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans 3
Each such notice of termination or reduction shall specify the amount of the
Commitments to be terminated or reduced. Each such notice of borrowing,
Conversion, Continuation or prepayment shall specify the Loans to be borrowed,
Converted, Continued or prepaid and the amount (subject to Section 4.04 hereof)
and Type of each Loan to be borrowed, Converted, Continued or prepaid (and, in
the case of a Conversion, the Type of Loan to result from such Conversion) and
the date of borrowing, Conversion, Continuation or prepayment (which shall be a
Business Day). Each such notice of the duration of an Interest Period shall
specify the Loans to which such Interest Period is to relate. The Administrative
Agent shall promptly notify the Banks of the contents of each such notice. In
the event that the Borrower fails to select the Type of Loan, or the duration of
any Interest Period for any Eurodollar Loan, within the time period and
otherwise as provided in this Section 4.05, such Loan (if outstanding as a
Eurodollar Loan) will be automatically Converted into a Base Rate Loan on the
last day of the then current Interest Period for such Loan or (if outstanding as
a Base Rate Loan) will remain as, or (if not then outstanding) will be made as,
a Base Rate Loan.
4.06 Non-Receipt of Funds by the Administrative Agent.
Unless the Administrative Agent shall have been notified by a Bank or the
Borrower (each a "Payor") prior to the date on which the Payor is to make
payment to the Administrative Agent of (in the case of a Bank) the proceeds of a
Loan to be made by such Bank hereunder or (in the case of the Borrower) a
payment to the Administrative Agent for account of one or more of the Banks
hereunder (such payment being herein called the "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(s) on such date; and, if the Payor has not in fact made
the Required Payment to the Administrative Agent, the recipient(s) of such
payment shall, on demand, repay to the Administrative Agent the amount so made
available together with interest thereon in respect of each day during the
period commencing on the date (the "Advance 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 the Federal Funds Rate for
such day and, if such recipient(s) shall fail promptly to make such payment, the
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Administrative Agent shall be entitled to recover such amount, on demand, from
the Payor, together with interest as aforesaid, provided that if the
recipient(s) shall fail to return, and the Payor shall fail to make, the
Required Payment to the Administrative Agent within three Business Days of the
Advance Date, then, retroactively to the Advance Date, the Payor and the
recipient(s) shall each be obligated to pay interest on the Required Payment as
follows:
(i) if the Required Payment shall represent a payment to be made by
the Borrower to the Banks, the Borrower and the recipient(s) shall each be
obligated retroactively to the Advance Date to pay interest in respect of
the Required Payment at the Post-Default Rate (and, in case the
recipient(s) shall return the Required Payment to the Administrative Agent,
without limiting the obligation of the Borrower under Section 3.02 hereof
to pay interest to such recipient(s) at the Post-Default Rate in respect of
the Required Payment); and
(ii) if the Required Payment shall represent proceeds of a Loan to be
made by the Banks to the Borrower, the Payor and the Borrower shall each be
obligated retroactively to the Advance Date to pay interest in respect of
the Required Payment at the rate of interest provided for such Required
Payment pursuant to Section 3.02 hereof (and, in case the Borrower shall
return the Required Payment to the Administrative Agent, without limiting
any claim the Borrower may have against the Payor in respect of the
Required Payment).
4.07 Sharing of Payments, Etc.
(a) Offset. The Borrower agrees that, if a Default hereunder shall have
occurred and is continuing, then in addition to (and without limitation of) any
right of set-off, banker's lien or counterclaim a Bank may otherwise have, each
Bank shall be entitled, at its option, to offset balances held by it for account
of the Borrower at any of its offices, in Dollars or in any other currency,
against any principal of or interest on any of such Bank's Loans to the Borrower
or any other amount payable to such Bank by the Borrower hereunder, that is not
paid when due (regardless of whether such balances are then due to the
Borrower), in which case it shall promptly notify the Borrower and the
Administrative Agent thereof, provided that such Bank's failure to give such
notice shall not affect the validity thereof.
(b) Sharing of Payments. If any Bank shall obtain from the Borrower payment
of any principal of or interest on any Loan owing to it or payment of any other
amount under this Agreement through the exercise of any right of set-off,
banker's lien or counterclaim or similar right or otherwise (other than from the
Administrative Agent as provided herein), and, as a result of such payment, such
Bank shall have received a greater percentage of the principal of or interest on
the Loans or such other amounts then due hereunder by the Borrower to such Bank
than the percentage received by any other Bank, it shall promptly purchase from
such other Banks participations in (or, if and to the extent specified by such
Bank, direct interests in) the Loans or such other amounts, respectively, owing
to such other Banks (or in interest due thereon, as the case may be) in such
amounts, and make such other adjustments from time to time as shall be
equitable, to the end that all the Banks shall share the benefit of such excess
payment (net of any expenses that may be incurred by such Bank in obtaining or
preserving such excess payment) pro rata in accordance with the unpaid principal
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of and/or interest on the Loans or such other amounts, respectively, owing to
each of the Banks. To such end all the Banks shall make appropriate adjustments
among themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be restored.
(c) Indirect Holders. The Borrower agrees that, if a Default hereunder
shall have occurred and is continuing, then any Bank so purchasing such a
participation (or direct interest) may exercise all rights of set-off, banker's
lien, counterclaim or similar rights with respect to such participation as fully
as if such Bank were a direct holder of Loans or other amounts (as the case may
be) owing to such Bank in the amount of such participation.
(d) Other Indebtedness. Nothing contained herein shall require any Bank to
exercise any such right or shall affect the right of any Bank to exercise, and
retain the benefits of exercising, any such right with respect to any other
indebtedness or obligation of the Borrower. If, under any applicable bankruptcy,
insolvency or other similar law, any Bank receives a secured claim in lieu of a
set-off to which this Section 4.07 applies, such Bank shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Banks entitled under this Section 4.07 to
share in the benefits of any recovery on such secured claim.
Section 5. Yield Protection, Etc.
5.01 Additional Costs.
(a) Additional Costs. The Borrower shall pay directly to each Bank from
time to time such amounts as such Bank may reasonably determine to be necessary
to compensate such Bank for any costs that such Bank determines are attributable
to its making or maintaining of any Eurodollar Loans or its obligation to make
any Eurodollar Loans to the Borrower hereunder, or any reduction in any amount
receivable by such Bank hereunder in respect of any of such Loans or such
obligation (such increases in costs and reductions in amounts receivable being
herein called "Additional Costs"), resulting from any Regulatory Change that:
(i) changes the basis of taxation of any amounts payable to such Bank
under this Agreement in respect of any of such Loans (other than taxes
imposed on or measured by the overall net income of such Bank or of its
Applicable Lending Office for any of such Loans by the jurisdiction in
which such Bank has its principal office or such Applicable Lending
Office); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than the Reserve Requirement utilized in the
determination of the Fixed Base Rate for such Loan) relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities of, such Bank (including, without limitation, any of such Loans
or any deposits referred to in the definition of "Fixed Base Rate" in
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Section 1.01 hereof), or any commitment of such Bank (including, without
limitation, the Commitment of such Bank hereunder); or
(iii) imposes any other condition affecting this Agreement (or any of
such extensions of credit or liabilities) or its Commitment.
If any Bank requests compensation from the Borrower under this Section 5.01(a),
the Borrower may, by notice to such Bank (with a copy to the Administrative
Agent), suspend the obligation of such Bank thereafter to make or Continue Loans
of the Type with respect to which such compensation is requested, or to Convert
Loans of any other Type into Loans of such Type, until the Regulatory Change
giving rise to such request ceases to be in effect (in which case the provisions
of Section 5.04 hereof shall be applicable), provided that such suspension shall
not affect the right of such Bank to receive the compensation so requested.
(b) Regulatory Changes. Without limiting the effect of the provisions of
paragraph (a) of this Section 5.01, in the event that, by reason of any
Regulatory Change, any Bank either (i) incurs Additional Costs based on or
measured by the excess above a specified level of the amount of a category of
deposits or other liabilities of such Bank that includes deposits by reference
to which the interest rate on Eurodollar Loans is determined as provided in this
Agreement or a category of extensions of credit or other assets of such Bank
that includes Eurodollar Loans or (ii) becomes subject to restrictions on the
amount of such a category of liabilities or assets that it may hold, then, if
such Bank so elects by notice to the Borrower (with a copy to the Administrative
Agent), the obligation of such Bank to make or Continue, or to Convert Loans of
any other Type into, Loans of such Type hereunder shall be suspended until such
Regulatory Change ceases to be in effect (in which case the provisions of
Section 5.04 hereof shall be applicable).
(c) Compensation. Without limiting the effect of the foregoing provisions
of this Section 5.01 (but without duplication), the Borrower shall pay directly
to each Bank from time to time on request such amounts as such Bank may
reasonably determine to be necessary to compensate such Bank (or, without
duplication, the bank holding company of which such Bank is a subsidiary) for
any costs that it determines are attributable to the maintenance by such Bank
(or any Applicable Lending Office or such bank holding company), pursuant to any
law or regulation or any interpretation, directive or request (whether or not
having the force of law and whether or not failure to comply therewith would be
unlawful) of any court or governmental or monetary authority (i) following any
Regulatory Change or (ii) implementing any risk-based capital guideline or other
requirement (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) hereafter issued by any
government or governmental or supervisory authority implementing at the national
level the Basle Accord (including, without limitation, the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal Reserve System (12
C.F.R. Part 208, Appendix A; 00 X.X.X. Xxxx 000, Xxxxxxxx X) and the Final
Risk-Based Capital Guidelines of the Office of the Comptroller of the Currency
(12 C.F.R. Part 3, Appendix A)), of capital in respect of its Commitment or
Loans (such compensation to include, without limitation, an amount equal to any
reduction of the rate of return on assets or equity of such Bank (or any
Applicable Lending Office or such bank holding company) to a level below that
which such Bank (or any Applicable Lending Office or such bank holding company)
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could have achieved but for such law, regulation, interpretation, directive or
request). For purposes of this Section 5.01(c), "Basle Accord" shall mean the
proposals for risk-based capital framework described by the Basle Committee on
Banking Regulations and Supervisory Practices in its paper entitled
"International Convergence of Capital Measurement and Capital Standards" dated
July 1988, as amended, modified and supplemented and in effect from time to time
or any replacement thereof.
(d) Notification. Each Bank shall notify the Borrower of any event
occurring after the date of this Agreement entitling such Bank to compensation
under paragraph (a) or (c) of this Section 5.01 as promptly as practicable, but
in any event within 45 days, after such Bank obtains actual knowledge thereof;
provided that (i) if any Bank fails to give such notice within 45 days after it
obtains actual knowledge of such an event, such Bank shall, with respect to
compensation payable pursuant to this Section 5.01 in respect of any costs
resulting from such event, be entitled to payment under this Section 5.01 only
for costs incurred from and after the date 45 days prior to the date that such
Bank does give such notice and (ii) each Bank will designate a different
Applicable Lending Office for the Loans of such Bank affected by such event if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole opinion of such Bank, be disadvantageous
to such Bank, except that such Bank shall have no obligation to designate an
Applicable Lending Office located in the United States of America. Each Bank
will furnish to the relevant Borrower a certificate setting forth in reasonable
detail the basis and amount of each request by such Bank for compensation under
paragraph (a) or (c) of this Section 5.01. Determinations and allocations by any
Bank for purposes of this Section 5.01 of the effect of any Regulatory Change
pursuant to paragraph (a) or (b) of this Section 5.01, or of the effect of
capital maintained pursuant to paragraph (c) of this Section 5.01, on its costs
or rate of return of maintaining Loans or its obligation to make Loans, or on
amounts receivable by it in respect of Loans, and of the amounts required to
compensate such Bank under this Section 5.01, shall be conclusive, provided that
such determinations and allocations are made on a reasonable basis.
(e) Eurodollar Loans. Without limiting the effect of the foregoing, the
Borrower shall pay to each Bank on the last day of each Interest Period for each
Loan made by such Bank to the Borrower so long as such Bank is maintaining
reserves against "Eurocurrency liabilities" under Regulation D (or, unless the
provisions of paragraph (b) above are applicable, so long as such Bank is, by
reason of any Regulatory Change, maintaining reserves against any other category
of liabilities which includes deposits by reference to which the interest rate
on Eurodollar Loans is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Bank which includes any
Eurodollar Loans) an additional amount (determined by such Bank and notified to
the Borrower by such Bank with a copy to the Administrative Agent) equal to the
product of the following for each Eurodollar Loan for each day during such
Interest Period:
(i) the principal amount of such Eurodollar Loan outstanding on such
day; and
(ii) the remainder of (x) a fraction the numerator of which is the
rate (expressed as a decimal) at which interest accrues on such Eurodollar
Loan for such Interest Period as provided in this Agreement (less the
Applicable Margin) and the denominator of which is one minus the effective
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rate (expressed as a decimal) at which such reserve requirements are
imposed on such Bank on such day minus (y) such numerator; and
(iii) 1/360.
5.02 Limitation on Types of Loans.
Anything herein to the contrary notwithstanding, if, on or prior to the
determination of any Fixed Base Rate for any Interest Period:
(a) the Administrative Agent determines, which determination shall be
conclusive, that quotations of interest rates for the relevant deposits
referred to in the definition of "Fixed Base Rate" in Section 1.01 hereof
are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for either Type of
Eurodollar Loans as provided herein; or
(b) the Majority Banks determine, which determination shall be
conclusive, and notify the Administrative Agent that the relevant rates of
interest referred to in the definition of "Fixed Base Rate" in Section 1.01
hereof upon the basis of which the rate of interest for Eurodollar Loans
for such Interest Period is to be determined are not likely adequately to
cover the cost to such Banks of making or maintaining such Type of Loans
for such Interest Period;
then the Administrative Agent shall give the Borrower and each Bank prompt
notice thereof and, so long as such condition remains in effect, the Banks (or
such quoting Bank) shall be under no obligation to make additional Loans of such
Type, to Continue Loans of such Type or to Convert Loans of any other Type into
Loans of such Type, and the Borrower shall, on the last day(s) of the then
current Interest Period(s) for the outstanding Loans of such Type, either prepay
such Loans or Convert such Loans into another Type of Loan in accordance with
Section 2.09 hereof.
5.03 Illegality.
Notwithstanding any other provision of this Agreement, in the event that it
becomes unlawful for any Bank or its Applicable Lending Office to honor its
obligation to make or maintain Eurodollar Loans hereunder to the Borrower, then
such Bank shall promptly notify the Borrower thereof (with a copy to the
Administrative Agent) and such Bank's obligation to the Borrower to make or
Continue, or to Convert Loans of any other Type into, Eurodollar Loans shall be
suspended until such time as such Bank may again make and maintain Eurodollar
Loans to the Borrower (in which case the provisions of Section 5.04 hereof shall
be applicable).
5.04 Treatment of Affected Loans.
If the obligation of any Bank to make a Eurodollar Loan or to Continue, or
to Convert Loans of any Type into, Eurodollar Loans shall be suspended pursuant
to Section 5.01 or 5.03 hereof (Loans of such Type being herein called "Affected
Loans" and such Type being herein called the "Affected Type"), such Bank's
Affected Loans shall be automatically Converted into Base Rate Loans on the last
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day(s) of the then current Interest Period(s) for Affected Loans (or, in the
case of a Conversion as a result of Section 5.01(b) or 5.03 hereof, on such
earlier date as such Bank may specify to the Borrower of such Affected Loans
with a copy to the Administrative Agent) and, unless and until such Bank gives
notice as provided below that the circumstances specified in Section 5.01 or
5.03 hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Bank's Affected Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Bank's Affected Loans shall be applied instead to its
Base Rate Loans;
(b) all Loans that would otherwise be made or Continued by such Bank
as Loans of the Affected Type shall be made or Continued instead as Base
Rate Loans, and all Loans of such Bank that would otherwise be Converted
into Loans of the Affected Type shall be Converted instead into (or shall
remain as) Base Rate Loans; and
(c) if Loans of other Banks of the Affected Type are subsequently
Converted into Loans of another Type (other than Base Rate Loans), such
Bank's Base Rate Loans shall be automatically Converted on the Conversion
date for such Loans of the other Banks into Loans of such other Type to the
extent necessary so that, after giving effect thereto, all Loans held by
such Bank and the Banks whose Loans are so Converted are held pro rata (as
to principal amounts, Types and Interest Periods) in accordance with their
respective Commitments.
If such Bank gives notice to the affected Borrower(s) with a copy to the
Administrative Agent that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to the Conversion of such Bank's Affected Loans pursuant
to this Section 5.04 no longer exist (which such Bank agrees to do promptly upon
such circumstances ceasing to exist) at a time when Loans of the Affected Type
made by other Banks are outstanding, such Bank's Base Rate Loans shall be
automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding Loans of the Affected Type, to the extent
necessary so that, after giving effect thereto, all Loans held by the Banks
holding Loans of the Affected Type and by such Bank are held pro rata (as to
principal amounts, Types and Interest Periods) in accordance with their
respective Commitments.
5.05 Compensation.
The Borrower shall pay to the Administrative Agent for account of each
Bank, upon the request of such Bank through the Administrative Agent, such
amount or amounts as shall be sufficient (in the reasonable opinion of such
Bank) to compensate it for any loss, cost or expense that such Bank determines
is attributable to:
(a) any payment, prepayment or Conversion of a Eurodollar Loan made by
such Bank to the Borrower for any reason (including, without limitation,
the acceleration of the Loans pursuant to Section 10 hereof) on a date
other than the last day of the Interest Period for such Loan;
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(b) any failure by the Borrower for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 7 hereof to be satisfied) to borrow a Eurodollar Loan from such
Bank on the date for such borrowing specified in the relevant notice of
borrowing given pursuant to Section 2.02 hereof; or
(c) any failure for any reason (including, without limitation, as
provided in Section 5.02 or 5.03 hereof) of a Loan of such Bank to the
Borrower to be Continued as or Converted into a Eurodollar Loan on the date
for such Continuation or Conversion specified in the relevant notice given
pursuant to Section 2.09 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid or
Converted or not borrowed, Continued or Converted for the period from the date
of such payment, prepayment, Conversion or failure to borrow, Continue or
Convert to the last day of the then current Interest Period for such Loan (or,
in the case of a failure to borrow, Continue or Convert, the Interest Period for
such Loan that would have commenced on the date specified for such borrowing,
Continuation or Conversion) at the applicable rate of interest for such Loan
provided for herein over (ii) the amount of interest that otherwise would have
accrued on such principal amount at a rate per annum equal to the interest
component of the amount such Bank would have bid in the London interbank market
(if such Loan is a Eurodollar Loan) for Dollar deposits of leading banks in
amounts comparable to such principal amount and with maturities comparable to
such period (as reasonably determined by such Bank), or if such Bank shall cease
to make such bids, the equivalent rate, as reasonably determined by such Bank,
derived from Page 3750 of the Dow Xxxxx Markets Telerate Service or other
publicly available source as described in the definition of "Fixed Base Rate" in
Section 1.01.
5.06 U.S. Taxes.
(a) Non U.S. Persons. The Borrower agrees to pay to each Bank that is not a
U.S. Person such additional amounts as are necessary in order that the net
payment of any amount due by the Borrower to such non-U.S. Person hereunder
after deduction for or withholding in respect of any U.S. Tax imposed with
respect to such payment (or in lieu thereof, payment of such U.S. Tax by such
non-U.S. Person), will not be less than the amount stated herein to be then due
and payable, provided that the foregoing obligation to pay such additional
amounts shall not apply:
(i) to any payment to a Bank hereunder unless such Bank is, on the
date hereof (or on the date it becomes a Bank as provided in Section
12.06(b) hereof) and on the date of any change in the Applicable Lending
Office of such Bank, either entitled to submit a Form W-8BEN (relating to
such Bank and entitling it to a complete exemption from withholding on all
interest to be received by it hereunder in respect of the Loans) or Form
W-8ECI (relating to all interest to be received by such Bank hereunder in
respect of the Loans), or
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(ii) to any U.S. Tax imposed solely by reason of the failure by such
non-U.S. Person to comply with applicable certification, information,
documentation or other reporting requirements concerning the nationality,
residence, identity or connections with the United States of America of
such non-U.S. Person if such compliance is required by statute or
regulation of the United States of America as a precondition to relief or
exemption from such U.S. Tax.
For the purposes of this Section 5.06(a), (w) "Form W-8BEN" shall mean Form
W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax
Withholding) of the Department of the Treasury of the United States of America,
(x) "Form W-8ECI" shall mean Form W-8ECI (Certificate of Foreign Person's Claim
for Exemption from Withholding on Income Effectively Connected with the Conduct
of a Trade or Business in the United States) of the Department of the Treasury
of the United States of America (or in relation to either such Form such
successor and related forms as may from time to time be adopted by the relevant
taxing authorities of the United States of America to document a claim to which
such Form relates), (y) "U.S. Person" shall mean a citizen, national or resident
of the United States of America, a corporation, partnership or other entity
created or organized in or under any laws of the United States of America, or
any estate or trust that is subject to Federal income taxation regardless of the
source of its income and (z) "U.S. Taxes" shall mean any present or future tax,
assessment or other charge or levy imposed by or on behalf of the United States
of America or any taxing authority thereof or therein.
(b) Evidence or Deduction or Withholding. Within 30 days after paying any
amount to the Administrative Agent or any Bank from which it is required by law
to make any deduction or withholding, and within 30 days after it is required by
law to remit such deduction or withholding to any relevant taxing or other
authority, the Borrower shall deliver to the Administrative Agent for delivery
to such non-U.S. Person evidence satisfactory to such Person of such deduction,
withholding or payment (as the case may be).
Section 6. [Reserved].
Section 7. Conditions Precedent.
7.01 Conditions.
The obligation of any Bank to make its Loan or Loans hereunder is subject
to the receipt, on or before September 28, 2001, by the Administrative Agent
(with sufficient copies for each Bank that requests a copy) of the following
documents, each of which shall be satisfactory to the Administrative Agent (and
to the extent specified below, to each Bank) in form and substance:
(a) Corporate Documents. Certified copies of the charter and by-laws
of the Borrower and of all corporate authority for the Borrower (including,
without limitation, board of director resolutions and evidence of the
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incumbency, including specimen signatures, of officers) with respect to the
execution, delivery and performance of this Agreement and the Loans to be
made to the Borrower hereunder (and the Administrative Agent and each Bank
may conclusively rely on such certificate until it receives notice in
writing from the Borrower to the contrary).
(b) Officer's Certificate. A certificate of a financial officer of the
Borrower, to the effect set forth in the first sentence of Section 7.02
hereof.
(c) The Alliance Arrangement. Evidence that (i) a Final Order (as such
term is defined in the Alliance Arrangement Agreement) shall have been
issued by the Superior Court of Quebec, District of Montreal in a form in
all material respects identical to that which shall have been previously
approved by the Administrative Agent, (ii) neither Alliance nor any of its
Subsidiaries shall be in default in any material respect of any of the
provisions of the Alliance Arrangement Agreement, or of such Final Order,
(iii) except for the deposit with the depositary contemplated by the
Alliance Arrangement Agreement of the funds necessary to consummate the
Alliance Arrangement and except for the exchange of shares certificates by
the holders of shares of stock of Alliance, the Alliance Arrangement shall
have been duly consummated in all material respects in accordance with the
terms of the Alliance Arrangement Agreement as originally in effect (other
than any modifications or supplements thereto that shall be satisfactory to
the Majority Banks), (iv) no condition to the consummation of the Alliance
Arrangement thereunder shall have been waived, amended, supplemented or
otherwise modified in any material respect without the prior written
consent of the Majority Banks and (v) the Majority Banks shall be satisfied
with all determinations by the Borrower as to the satisfaction of
conditions set forth in the Alliance Arrangement Agreement, and the
Administrative Agent shall have received a certificate of a financial
officer of the Borrower to the effect of the foregoing clauses (i) through
(v) and to the effect that attached thereto are complete and correct copies
of each document and other agreements or instruments delivered in
connection with the consummation of the Alliance Arrangement.
(d) Opinion of Counsel to the Borrower. An opinion of Xxxxx X. Xxxxx,
Esq., Vice President, Secretary and Assistant General Counsel of the
Borrower, substantially in the form of Exhibit B hereto and covering such
other matters as the Administrative Agent or any Bank may reasonably
request (and the Borrower hereby instructs such counsel to deliver such
opinion to the Banks and the Administrative Agent).
(e) Opinion of Special New York Counsel to Chase. An opinion of
Milbank, Tweed, Xxxxxx & XxXxxx LLP, special New York counsel to Chase,
substantially in the form of Exhibit C hereto (and Chase hereby instructs
such counsel to deliver such opinion to the Banks).
(f) Extension of the Existing Credit Agreement. Evidence that all
commitments of the lenders to extend credit under the Existing Credit
Agreement shall have been concurrently extended for an additional 364 days
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and reduced to an aggregate principal amount up to but not exceeding
$450,000,000.
(g) Other Documents. Such other documents as the Administrative Agent
or any Bank or special New York counsel to Chase may reasonably request.
The obligation of any Bank to make its extension of credit hereunder is also
subject to the payment or delivery by the Borrower of such fees and other
consideration as the Borrower shall have agreed to pay or deliver to any Bank or
an affiliate thereof or the Administrative Agent in connection herewith
including, to the extent provided in Section 12.03, the reasonable fees and
expenses of Milbank, Tweed, Xxxxxx & XxXxxx, LLP, special New York counsel to
Chase, in connection with the negotiation, preparation, execution and delivery
of this Agreement and the extensions of credit hereunder (to the extent that
statements for such fees and expenses have been delivered to the Borrower).
7.02 Additional Conditions.
The obligation of any Bank to make any Loan to the Borrower upon the
occasion of each borrowing hereunder is subject to the further conditions
precedent that, both immediately prior to the making of such Loan and also after
giving effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be continuing; and
(b) the representations and warranties made by the Borrower in Section
8 hereof shall be true and complete on and as of the date of the making of
such Loan with the same force and effect as if made on and as of such date
(or, if any such representation or warranty is expressly stated to have
been made as of a specific date, as of such specific date).
Each notice of borrowing hereunder shall constitute a certification by the
Borrower to the effect set forth in the preceding sentence (both as of the date
of such notice and, unless the Borrower otherwise notifies the Administrative
Agent prior to the date of such borrowing, as of the date of such borrowing).
Section 8. Representations and Warranties.
The Borrower represents and warrants to the Administrative Agent and the
Banks the following (it being understood that until the consummation of the
Alliance Arrangement, references herein to Alliance, any of its Subsidiaries or
any of their respective Property, the Alliance Arrangement Agreement, the
Management Proxy Circular or any Canadian Plan shall be deemed inapplicable):
8.01 Corporate Existence.
Each of the Borrower and its Subsidiaries: (a) is a corporation,
partnership or other entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization; (b) has all
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requisite corporate or other power, and has all material governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted; and (c) is qualified
to do business and is in good standing in all jurisdictions in which the nature
of the business conducted by it makes such qualification necessary and where
failure so to qualify could have a Material Adverse Effect.
8.02 Financial Condition.
The Borrower has heretofore furnished to each of the Banks the following
financial statements:
(i) the audited consolidated balance sheets of the Borrower and its
Consolidated Subsidiaries as at December 31, 1999 and December 31, 2000,
respectively, and the related audited consolidated statements of
operations, capital accounts and cash flows of the Borrower and its
Consolidated Subsidiaries for the fiscal years ended on said respective
dates, with the opinion thereon of KPMG Peat Marwick LLP;
(ii) the unaudited consolidated balance sheets of the Borrower and its
Consolidated Subsidiaries as at March 31, 2001 and the related unaudited
consolidated statements of operations, capital accounts and cash flows of
the Borrower and its Consolidated Subsidiaries for the three month period
ended on said date;
(iii) a pro forma condensed combined unaudited balance sheet of the
Borrower and its Consolidated Subsidiaries as at March 31, 2001, and the
related pro forma condensed combined unaudited statements of operations of
the Borrower and its Consolidated Subsidiaries for the year ended December
31, 2000 and for the three months ended March 31, 2001, all as set forth in
the Management Proxy Circular, certified by a financial officer of the
Borrower and prepared under the assumption that the Alliance Arrangement
and the borrowings contemplated hereunder had each been consummated on
March 31, 2001 (for the balance sheet) or January 1, 2000 (for the
statements of operations), and demonstrating the solvency of the Borrower
and its Consolidated Subsidiaries on a pro forma basis after giving effect
to the Alliance Arrangement; and
(iv) consolidated financial statement projections for the Borrower and
its Consolidated Subsidiaries giving effect to the Alliance Arrangement and
the borrowings contemplated hereunder, which projections shall cover the
three-year period through the fiscal year ended December 31, 2003.
Such financial statements (other than the projections described in clause (iv))
are complete and correct and fairly present the respective consolidated actual
or pro forma (as the case may be) financial condition of the Borrower and its
Consolidated Subsidiaries, as at said date and the actual or pro forma (as
applicable) consolidated results of their operations for the fiscal year ended
on said date, all in accordance with generally accepted accounting principles
and practices of the United States of America applied on a consistent basis; and
neither the Borrower nor any of its Subsidiaries had on the date thereof any
material contingent liabilities, liabilities for taxes, unusual forward or
long-term commitments or unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said balance
sheets as at said date. There has been no material adverse change in the
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Property, business, operations, financial condition, liabilities or
capitalization of the Borrower and its Consolidated Subsidiaries taken as a
whole since the last day of the fiscal year of the Borrower as to which
financial statements have most recently been delivered pursuant to Section
9.01(b) hereof (or, if no such financial statements have yet been delivered,
since December 31, 2000).
8.03 Litigation.
Except as disclosed to the Banks in Schedule IV hereto, there are no legal
or arbitral proceedings, or any proceedings by or before any governmental or
regulatory authority or agency, or any labor disputes, or investigations now
pending or (to the knowledge of the Borrower) threatened against the Borrower or
any of its Subsidiaries (or Alliance or any of its Subsidiaries) that, if
adversely determined, could in the judgment of the Majority Banks have a
Material Adverse Effect. Without limiting the generality of the foregoing, there
are no legal or arbitral proceedings, or any proceedings by or before any
governmental or regulatory authority or agency, or any investigations now
pending or (to the knowledge of the Borrower) threatened against the Borrower or
any of its Subsidiaries (or Alliance or any of its Subsidiaries) affecting or
relating to the Alliance Arrangement (except in connection with the Alliance
Arrangement, each of which shall have been completed with all appeal periods
expired without any appeal having been taken prior to the consummation of the
Arrangement).
8.04 No Breach.
None of the execution and delivery of this Agreement, the consummation of
the transactions herein contemplated or compliance with the terms and provisions
hereof, or any Debt Incurrence, will conflict with or result in a breach of, or
require any consent under, the charter or by-laws of the Borrower, or any
applicable law or regulation in any material respect, or any order, writ,
injunction or decree of any court or governmental authority or agency, or any
agreement or instrument in any material respect to which the Borrower or any of
its Subsidiaries is a party or by which any of them or any of their Property is
bound or to which any of them is subject, or constitute a default under any such
agreement or instrument, or result in the creation or imposition of any Lien
upon any Property of the Borrower or any of its Subsidiaries pursuant to the
terms of any such agreement or instrument.
8.05 Action.
The Borrower has all necessary corporate power, authority and legal right
to execute, deliver and perform its obligations under this Agreement and to
borrow under this Agreement; the execution, delivery and performance by the
Borrower of this Agreement and the borrowings by the Borrower under this
Agreement have been duly authorized by all necessary corporate action on its
part (including, without limitation, any required shareholder approvals); and
this Agreement has been duly and validly executed and delivered by the Borrower
and constitutes, its legal, valid and binding obligation, enforceable against
the Borrower in accordance with its terms, except as such enforceability may be
limited by (a) bankruptcy, insolvency, reorganization, moratorium or similar
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laws of general applicability affecting the enforcement of creditors' rights and
(b) the application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
8.06 Approvals.
No authorizations, approvals or consents of, and no filings or
registrations with, any governmental or regulatory authority or agency, or any
securities exchange, are necessary for the execution, delivery or performance by
the Borrower of this Agreement or for the legality, validity or enforceability
hereof or thereof, or for any borrowing by the Borrower under this Agreement, or
in connection with the Alliance Arrangement (except in connection with the
Alliance Arrangement, each of which shall have been obtained and be in full
force and effect prior to the consummation of the Arrangement, with all waiting
periods having expired without any action being taken or threatened by any
competent authority which, in the judgment of the Majority Banks, would
restrain, prevent or otherwise impose adverse conditions on the Alliance
Arrangement or the financing thereof).
8.07 Use of Credit.
Neither the Borrower nor any of its Subsidiaries is engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or carrying Margin
Stock, and no part of the proceeds of any extension of credit hereunder will be
used to buy or carry any Margin Stock. Not more than 25% of the value of the
Properties of the Borrower and its Subsidiaries subject to the provisions of
Section 9.05 or Section 9.06 hereof is represented by Property constituting
Margin Stock.
8.08 ERISA; Canadian Plans.
Each Plan, and, to the knowledge of the Borrower, each Multiemployer Plan,
is in compliance in all material respects with, and has been administered in all
material respects in compliance with, the applicable provisions of ERISA, the
Code and any other Federal or state law, and no event or condition has occurred
and is continuing as to which the Borrower would be under an obligation to
furnish a report to the Banks under Section 9.01(e) hereof. Each Canadian Plan
is and has been in all material respects, established, qualified, registered,
administered and invested in compliance with all applicable federal and
provincial laws (including, without limitation, the Income Tax Act (Canada) and
the Supplemental Pension Plans Act (Quebec)) and any applicable collective
bargaining agreements, and no event or condition has occurred and is continuing
as to which the Borrower would be under an obligation to furnish a report to the
Banks under Section 9.01(f) hereof. All material obligations of the Borrower and
its Subsidiaries under each Canadian Plan, including contribution obligations,
have been satisfied and there are no outstanding defaults or violations in
respect thereof.
8.09 Taxes.
The Borrower and its domestic Subsidiaries (within the meaning of Section
7701(a)(4) of the Code) are members of an affiliated group of corporations
filing consolidated returns for Federal income tax purposes, of which the
Borrower is the "common parent" (within the meaning of Section 1504 of the Code)
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of such group. The Borrower and its Subsidiaries have filed all Federal income
tax returns and all other material tax returns that are required to be filed by
them and have paid all taxes due pursuant to such returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in
respect of taxes and other governmental charges are, in the opinion of the
Borrower, adequate.
8.10 Investment Company Act.
Neither the Borrower nor any of its Subsidiaries is an "investment
company", or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended.
8.11 Public Utility Holding Company Act.
Neither the Borrower nor any of its Subsidiaries is a "holding company", or
an "affiliate" of a "holding company" or a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
8.12 Material Agreements and Liens.
(a) Material Agreements. Part A of Schedule II hereto is a complete and
correct list, as of the date of this Agreement, of each credit agreement, loan
agreement, indenture, guarantee, letter of credit or other arrangement providing
for or otherwise relating to any Indebtedness or any extension of credit (or
commitment for any extension of credit) to, or guarantee by, the Borrower or any
of its Subsidiaries (or by Alliance or any of its Subsidiaries) the aggregate
principal or face amount of which equals or exceeds (or may equal or exceed)
$50,000,000, and the aggregate principal or face amount outstanding or that may
become outstanding under each such arrangement is correctly described in Part A
of said Schedule II.
On the date hereof, the maximum aggregate principal or face amount of all
Indebtedness and all other extensions of credit outstanding (or that may become
outstanding) under each credit agreement, loan agreement, indenture, guarantee,
letter of credit or other arrangement to which the Borrower or any of its
Subsidiaries (or Alliance or any of its Subsidiaries) is a party, or guarantee
by the Borrower or any of its Subsidiaries (or by Alliance or any of its
Subsidiaries), that is not listed in Part A of Schedule II hereto does not
exceed an amount equal to $25,000,000.
(b) Material Liens. Part B of Schedule II hereto is a complete and correct
list, as of the date of this Agreement, of each Lien securing Indebtedness of
any Person the aggregate principal or face amount of which equals or exceeds (or
may equal or exceed) $50,000,000 and covering any Property of the Borrower or
any of its Subsidiaries (or Alliance or any of its Subsidiaries), and the
aggregate Indebtedness secured (or which may be secured) by each such Lien and
the Property covered by each such Lien is correctly described in Part B of said
Schedule II.
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8.13 Environmental Matters.
Each of the Borrower and its Subsidiaries has obtained all environmental,
health and safety permits, licenses and other authorizations required under all
Environmental Laws to carry on its business as now being or as proposed to be
conducted, except to the extent failure to have any such permit, license or
authorization would not have a Material Adverse Effect. Each of such permits,
licenses and authorizations is in full force and effect and each of the Borrower
and its Subsidiaries is in compliance with the terms and conditions thereof, and
is 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
therewith would not have a Material Adverse Effect.
8.14 Subsidiaries, Etc.
Set forth in Part A of Schedule III hereto is a complete and correct list,
as of the date of this Agreement, of all of the Subsidiaries of the Borrower (or
of Alliance), except for unconsolidated special-purpose Subsidiaries and
inactive Subsidiaries awaiting dissolution, together with, for each such
Subsidiary, (i) the jurisdiction of organization of such Subsidiary, (ii) each
Person holding ownership interests in such Subsidiary and (iii) the nature of
the ownership interests held by each such Person and the percentage of ownership
of such Subsidiary represented by such ownership interests. Except as disclosed
in Part A of Schedule III hereto, (x) each of the Borrower and its Subsidiaries
(and Alliance and its Subsidiaries) owns, free and clear of Liens, and has the
unencumbered right to vote, all outstanding ownership interests in each Person
shown to be held by it in said Part A or Schedule III hereto, (y) all of the
issued and outstanding capital stock of each such Person organized as a
corporation is validly issued, fully paid and nonassessable and (z) there are no
outstanding Equity Rights with respect to such Person.
Except as disclosed in Part B of Schedule III hereto (and except for
restrictions and conditions imposed by law), none of Alliance or any of its
Subsidiaries is, on the date hereof (or on the date on which the Alliance
Arrangement shall be consummated), subject to any indenture, agreement,
instrument or other arrangement that (a) prohibits, restricts or imposes any
condition upon the ability of Alliance or any or its Subsidiaries to pay
dividends or other distributions with respect to any shares of its capital stock
or to make or repay loans or advances to the Borrower or any other Subsidiary or
(b) that will restrict in any material respect the ability of the Borrower and
its Subsidiaries from integrating their business and operations with that of
Alliance and its Subsidiaries.
After giving effect to the consummation of the Alliance Arrangement,
Alliance and its Subsidiaries will be Consolidated Subsidiaries hereunder.
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8.15 True and Complete Disclosure.
The information, reports, financial statements, exhibits and schedules
furnished in writing by or on behalf of the Borrower to the Administrative Agent
or any Bank (including, without limitation, the Management Proxy Circular) in
connection with the negotiation, preparation or delivery of this Agreement or
included herein or delivered pursuant hereto, when taken as a whole do not
contain any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading. All written
information furnished after the date hereof by the Borrower and its Subsidiaries
to the Administrative Agent and the Banks in connection with this Agreement and
the transactions contemplated hereby will be true, complete and accurate in
every material respect, or (in the case of projections) based on reasonable
estimates, on the date as of which such information is stated or certified.
There is no fact known to the Borrower that could have a Material Adverse Effect
that has not been disclosed herein or in a report, financial statement, exhibit,
schedule, disclosure letter or other writing furnished to the Banks for use in
connection with the transactions contemplated hereby.
8.16 Alliance Arrangement Agreement; Management Proxy Circular; Etc.
The Borrower has heretofore delivered to the Administrative Agent a
complete and correct copy of the Management Proxy Circular and the Alliance
Arrangement Agreement (in each case including any modifications or supplements
thereto, or any waivers thereunder) as in effect on the date hereof.
Section 9. Covenants of the Borrower.
The Borrower covenants and agrees with the Banks and the Administrative
Agent that, so long as any Commitment or any Loan by the Borrower is outstanding
and until payment in full of all amounts payable by the Borrower hereunder:
9.01 Financial Statements, Etc.
The Borrower shall deliver to the Administrative Agent (with sufficient
copies for each Bank, which the Administrative Agent shall promptly furnish to
such Bank):
(a) as soon as available and in any event within 60 days after the end
of each of the quarterly fiscal periods of each fiscal year of the
Borrower, consolidated statements of operations, capital accounts and cash
flows of the Borrower and its Consolidated Subsidiaries for such period and
for the period from the beginning of the respective fiscal year to the end
of such period, and the related consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as at the end of such period, setting
forth in each case in comparative form the corresponding consolidated
figures for the corresponding period in the preceding fiscal year;
(b) as soon as available and in any event within 120 days after the
end of each fiscal year of the Borrower, consolidated statements of
operations, capital accounts and cash flows of the Borrower and its
Consolidated Subsidiaries for such fiscal year and the related consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as at the
end of such fiscal year, setting forth in each case in comparative form the
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corresponding consolidated figures for the preceding fiscal year, and
accompanied by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall state that
said consolidated financial statements fairly present the consolidated
financial condition and results of operations of the Borrower and its
Consolidated Subsidiaries as at the end of, and for, such fiscal year in
accordance with generally accepted accounting principles of the United
States of America;
(c) promptly upon their becoming available, copies of all registration
statements (other than on Form S-8) and regular periodic reports on Forms
10-K, 10-Q and 8-K that the Borrower or any of its Subsidiaries shall have
filed with the Securities and Exchange Commission (or any governmental
agency substituted therefor), or any similar periodic reports filed with
the comparable agency in Canada;
(d) promptly upon the mailing thereof to the shareholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(e) as soon as possible, and in any event within ten days after the
Borrower knows or has reason to believe that any of the events or
conditions specified below with respect to any Plan or Multiemployer Plan
has occurred or exists, a statement signed by a financial officer of the
Borrower setting forth details respecting such event or condition and the
action, if any, that the Borrower 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 Borrower or an ERISA Affiliate with
respect to such event or condition):
(i) any reportable event, as defined in Section 4043(b) of ERISA
and the regulations issued thereunder, 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 Borrower 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 Borrower 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;
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(iv) the complete or partial withdrawal from a Multiemployer Plan
by the Borrower 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
by the Borrower 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;
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against the Borrower or any ERISA Affiliate to
enforce Section 515 of ERISA, which proceeding is not dismissed within
30 days; and
(vi) the adoption of an amendment to any Plan that, pursuant to
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 Borrower or an ERISA Affiliate fails to timely provide
security to the Plan in accordance with the provisions of said
Sections;
(f) as soon as possible, and in any event within ten days after the
Borrower or any of its Subsidiaries knows or has reason to believe that any
of the events or conditions specified below with respect to any Canadian
Plan has occurred or exists, a statement signed by a financial officer of
the Borrower setting forth details respecting such event or condition and
the action, if any, that the Borrower or its Subsidiary proposes to take
with respect thereto (and a copy of any notice required to be filed with or
given to any governmental authority in Canada by the Borrower or any
Subsidiary with respect to such event or condition):
(i) the Borrower or any of its Subsidiaries declares, or any
governmental authority orders, or proposes to order, a full or partial
termination or wind up of a Canadian Plan;
(ii) a failure by the Borrower or any Subsidiary to make a
contribution to a Canadian Plan in accordance with the terms thereof,
any collective bargaining agreement or under applicable federal or
provincial laws, which failure has not been remedied within 30 days
after the Borrower or the Subsidiary is notified of such event and
which failure could result in a Material Adverse Effect;
(iii) the adoption of any amendment to any Canadian Plan that
would result in a loss of tax exempt status of the Plan or the trust
or other funding medium maintained in respect of such Plan, or that
increases the funding obligations under any Canadian Plan, which
increase could reasonably be expected to result in a Material Adverse
Effect;
(iv) the institution of any proceeding, action, suit or claim
(other than routine claims for payment of benefits) involving any
Canadian Plan or its assets; or
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(v) any event occurring or condition existing with respect to any
Canadian Plan that has resulted or could result in any Canadian Plan
having its registration revoked or refused or being placed under the
administration of any governmental or regulatory authority (or their
representatives).
(g) promptly after the Borrower knows or has reason to believe that
any Default has occurred, a notice of such Default stating that such notice
is a "Notice of Default" and describing the same in reasonable detail and,
together with such notice or as soon thereafter as possible, a description
of the action that the Borrower has taken or proposes to take with respect
thereto; and
(h) from time to time such other information regarding the financial
condition, operations, business or prospects of the Borrower or any of its
Subsidiaries (including, without limitation, any accountants letters
delivered to management, and any Plan or Multiemployer Plan and any reports
or other information required to be filed under ERISA) as any Bank or the
Administrative Agent may reasonably request.
The Borrower will furnish to the Administrative Agent (with sufficient copies
for each Bank, which the Administrative Agent shall promptly furnish to such
Bank), at the time it furnishes each set of financial statements pursuant to
paragraph (a) or (b) above, a certificate of a financial officer of the Borrower
(i) to the effect that no Default has occurred and is continuing (or, if any
Default has occurred and is continuing, describing the same in reasonable detail
and describing the action that the Borrower has taken or proposes to take with
respect thereto) and (ii) setting forth in reasonable detail the computations
necessary to determine whether the Borrower is in compliance with Sections 9.07
and 9.08 hereof as of the end of the respective quarterly fiscal period or
fiscal year.
9.02 Litigation.
The Borrower will promptly give to the Administrative Agent (which shall
promptly furnish the same to each Bank) notice of all legal or arbitral
proceedings, and of all proceedings by or before any governmental or regulatory
authority or agency, and of all labor disputes, and any material development in
respect of such legal or other proceedings or disputes, affecting the Borrower
or any of its Subsidiaries, except proceedings or disputes that, if adversely
determined, would not have a Material Adverse Effect. Without limiting the
generality of the foregoing, the Borrower will give to the Administrative Agent
(which shall promptly furnish the same to each Bank) notice of the assertion of
any environmental claim by any Person against, or with respect to the activities
of, the Borrower or any of its Subsidiaries and notice of any alleged violation
of or non-compliance with any Environmental Laws or any permits, licenses or
authorizations, other than any environmental claim or alleged violation that, if
adversely determined, would not have a Material Adverse Effect.
9.03 Existence, Etc.
The Borrower will, and will cause each of its Subsidiaries to:
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(a) preserve and maintain its legal existence and all of its material
rights, privileges, licenses and franchises (provided that nothing in this
Section 9.03 shall prohibit any transaction expressly permitted under
Section 9.05 hereof);
(b) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities
(including, without limitation, any of the foregoing relating to
environmental matters), and comply with the terms of all of its contracts,
if failure to comply with such requirements could have a Material Adverse
Effect;
(c) pay and discharge all taxes, assessments and governmental charges
or levies imposed on it or on its income or profits or on any of its
Property prior to the date on which penalties attach thereto, except for
any such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which
adequate reserves are being maintained in accordance with generally
accepted accounting principles of the United States of America;
(d) maintain all of its Properties used or useful in its business in
good working order and condition, ordinary wear and tear excepted;
(e) keep adequate records and books of account, in which complete
entries will be made in accordance with generally accepted accounting
principles of the United States of America consistently applied; and
(f) permit representatives of any Bank or the Administrative Agent,
during normal business hours, to examine, copy and make extracts from its
books and records, to inspect any of its Properties, and to discuss its
business and affairs with its officers, all to the extent reasonably
requested by such Bank or the Administrative Agent (as the case may be).
9.04 Insurance.
The Borrower will, and will cause each of its Subsidiaries to, keep insured
by financially sound and reputable insurers all Property of a character usually
insured by corporations engaged in the same or similar business similarly
situated against loss or damage of the kinds and in the amounts customarily
insured against by such corporations and carry such other insurance as is
usually carried by such corporations.
9.05 Prohibition of Fundamental Changes.
The Borrower will not, nor will it permit any of its Subsidiaries to, enter
into any transaction of merger or consolidation or amalgamation, or liquidate,
wind up or dissolve itself (or suffer any liquidation or dissolution). The
Borrower will not, nor will it permit any of its Subsidiaries to, convey, sell,
lease, transfer or otherwise dispose of, in one transaction or a series of
transactions, all or a substantial part of its business or Property, whether now
owned or hereafter acquired (including, without limitation, receivables and
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leasehold interests, but excluding any inventory or other Property sold or
disposed of in the ordinary course of business and on ordinary business terms).
Notwithstanding the foregoing provisions of this Section 9.05:
(a) the Borrower may consummate the Alliance Arrangement;
(b) any Subsidiary of the Borrower may be merged, amalgamated or
consolidated with or into: (i) the Borrower if the Borrower shall be the
continuing or surviving corporation or (ii) any other such Subsidiary;
provided that if any such transaction shall be between a Subsidiary and a
Wholly Owned Subsidiary, the Wholly Owned Subsidiary (or in the case of an
amalgamation, a new Wholly Owned Subsidiary formed thereby) shall be the
continuing or surviving corporation;
(c) any Subsidiary of the Borrower may sell, lease, transfer or
otherwise dispose of any or all of its Property (upon voluntary liquidation
or otherwise) to the Borrower or a Wholly Owned Subsidiary of the Borrower;
(d) the Borrower or any Subsidiary of the Borrower may merge or
consolidate (and any such Subsidiary may amalgamate) with any other Person
if (i) in the case of a merger or consolidation of the Borrower, the
Borrower is the surviving corporation and, in any other case, the surviving
corporation is a Wholly-Owned Subsidiary of the Borrower and (ii) after
giving effect thereto no Default would exist;
(e) any Wholly Owned Subsidiary of the Borrower or Alliance may be
dissolved or liquidated, so long as any assets of such Wholly Owned
Subsidiary (after settlement of all claims against such Wholly Owned
Subsidiary) shall be transferred in such dissolution or liquidation to the
Borrower or Alliance or to another Wholly Owned Subsidiary of the Borrower
or Alliance; and
(f) in addition to the dispositions permitted pursuant to clauses (b)
through (e) of this Section 9.05, the Borrower or any Subsidiary of the
Borrower may sell or otherwise dispose of Property (including, without
limitation, by merger or consolidation) if, after giving effect to any such
sale or disposition, the book value of such Property, together with the
aggregate book value of the Property so sold or disposed of since December
31, 2000 does not exceed 20% of Total Assets at the date of (and before
giving effect to) such sale or disposition, provided that in any event the
dispositions set forth in Schedule V hereto shall in any event be permitted
and shall not to be included in the calculation of aggregate dispositions
otherwise permitted under the foregoing provisions of this clause (f).
9.06 Limitation on Liens.
The Borrower will not, nor will it permit any of its Subsidiaries to,
create, incur, assume or suffer to exist any Lien upon any of its Property,
whether now owned or hereafter acquired, except:
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(a) Liens in existence on the date hereof and listed in Part B of
Schedule II hereto;
(b) Liens imposed by any governmental authority for taxes, assessments
or charges not yet due or which are being contested in good faith and by
appropriate proceedings if adequate reserves with respect thereto are
maintained on the books of the Borrower or the affected Subsidiaries, as
the case may be, in accordance with GAAP;
(c) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are
not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings and Liens securing judgments
but only to the extent for an amount and for a period not resulting in an
Event of Default under Section 10(i) hereof;
(d) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(e) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in
the ordinary course of business;
(f) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the
use of Property or minor imperfections in title thereto which, in the
aggregate, are not material in amount, and which do not in any case
materially detract from the value of the Property subject thereto or
interfere with the ordinary conduct of the business of the Borrower or any
of its Subsidiaries;
(g) Liens on Property of any corporation that becomes a Subsidiary of
the Borrower after the date of this Agreement; provided that such Liens are
in existence at the time such corporation becomes a Subsidiary of the
Borrower and were not created in anticipation thereof;
(h) Liens upon real and/or tangible personal Property acquired after
the date hereof (by purchase, construction or otherwise) by the Borrower or
any of its Subsidiaries, each of which Liens either (A) existed on such
Property before the time of its acquisition and was not created in
anticipation thereof, or (B) was created solely for the purpose of securing
Indebtedness representing, or incurred to finance, refinance or refund, the
cost (including the cost of construction) of such Property; provided that
no such Lien shall extend to or cover any Property of the Borrower or such
Subsidiary other than the Property so acquired and improvements thereon;
(i) Liens securing obligations of the Borrower or any of its
Subsidiaries incurred in conjunction with industrial revenue bonds or
pollution control bonds of any facilities used by the Borrower or any of
its Subsidiaries;
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(j) additional Liens upon real and/or personal Property created after
the date hereof, provided that the aggregate outstanding principal amount
of Indebtedness secured by such Liens, together with the aggregate
principal amount of Indebtedness permitted under Section 9.11(f) hereof,
shall not at any time exceed 15% of Total Assets at such time; and
(k) any extension, renewal or replacement of the foregoing; provided
that the Liens permitted hereunder shall not be spread to cover any
additional Indebtedness or Property (other than a substitution of like
Property).
9.07 Consolidated Net Worth.
The Borrower will not permit Consolidated Net Worth at any time to be less
than (a) $1,500,000,000 plus (b) 50% of the consolidated net income of the
Borrower and its Consolidated Subsidiaries for each fiscal quarter of the
Borrower from and including the first fiscal quarter in 1998 to and including
the fiscal quarter ending on (or most recently ended prior to) such time;
provided that, if there is a consolidated net loss for any such fiscal quarter,
consolidated net income for such fiscal quarter shall, for the purposes of
clause (b) of this Section 9.07, be deemed to be zero.
9.08 Total Debt to Total Capital Ratio.
The Borrower will not permit the ratio of (a) Total Debt to (b) Total
Capital to exceed 0.60 to 1 at any time.
9.09 Transactions with Affiliates.
Except as expressly permitted by this Agreement, the Borrower will not, nor
will it permit any of its Subsidiaries to, directly or indirectly: (a) make any
Investment in an Affiliate; (b) transfer, sell, lease, assign or otherwise
dispose of any Property to an Affiliate; (c) merge into or consolidate with or
purchase or acquire Property from an Affiliate; or (d) enter into any other
transaction directly or indirectly with or for the benefit of an Affiliate
(including, without limitation, guarantees and assumptions of obligations of an
Affiliate); provided that (x) any Affiliate who is an individual may serve as a
director, officer or employee of the Borrower or any of its Subsidiaries and
receive reasonable compensation for his or her services in such capacity, (y)
the Borrower and its Subsidiaries may enter into transactions (other than
extensions of credit by the Borrower or any of its Subsidiaries to an Affiliate)
so long as the monetary or business consideration arising therefrom would be
substantially as advantageous to the Borrower and its Subsidiaries as the
monetary or business consideration which would obtain in a comparable
transaction with a Person not an Affiliate and (z) the Borrower and its
Subsidiaries may enter into any of the transactions described in this Section
9.09 with Ponderay, so long as, in the case of any Guarantee by the Borrower of
the Indebtedness of Ponderay, the ratio, expressed as a percentage, of such
Indebtedness that is Guaranteed by the Borrower to the aggregate outstanding
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principal amount of all Indebtedness of Ponderay shall not exceed the ownership
percentage of the Borrower in Ponderay held through the Borrower's Wholly-Owned
Subsidiary, Lake Superior Forest Products Inc., a corporation existing under the
laws of the State of Delaware.
9.10 Use of Proceeds.
The Borrower will use the proceeds of the Loans hereunder to finance the
Alliance Arrangement, to refinance existing indebtedness of the Borrower or
Alliance, and to pay fees and expenses relating thereto, and for the general
corporate purposes of the Borrower and its Subsidiaries; provided that neither
the Administrative Agent nor any Bank shall have any responsibility as to the
use of any of such proceeds.
9.11 Indebtedness.
The Borrower will not permit any of its Subsidiaries to, create, incur,
assume or permit to exist any Indebtedness (including any Indebtedness incurred
pursuant to a sale or leaseback transaction), except:
(a) Indebtedness of Subsidiaries of the Borrower (or of Alliance and
its Subsidiaries) existing on the date hereof and (to the extent exceeding
the minimum threshold requirements set forth in Section 8.12(a)) set forth
in Part A of Schedule II hereto, any assumption or Guarantee thereof by any
other Subsidiary, and any extensions, renewals and replacements thereof, so
long as (i) the weighted average life of the maturity of such Indebtedness
as so extended, renewed or refinanced, taken as a whole, is not materially
different than such weighted average life prior to such extension, renewal
or refinancing, (ii) any terms of subordination set forth in such
Indebtedness are not adversely affected thereby in any material respect and
(iii) the terms generally of such Indebtedness as so extended, renewed or
refinanced are not made more restrictive (from the standpoint of the
Borrower) in any material respect;
(b) Indebtedness of (i) Bowater Pulp and Paper Canada Inc. in an
aggregate principal amount up to but not exceeding $110,000,000 and (ii)
one or more Subsidiaries of the Borrower in respect of bonds, debentures,
notes or similar instruments in a principal amount up to but not exceeding
$600,000,000 in the aggregate as to all such Subsidiaries, provided that
the proceeds thereof are applied to the prepayment of the Loans hereunder
as required by Section 2.10;
(c) Indebtedness of any Subsidiary to the Borrower or any other
Subsidiary;
(d) Indebtedness of any Subsidiary as an account party in respect of
trade letters of credit;
(e) Guarantees by Subsidiaries of Indebtedness of other Subsidiaries;
and
(f) other unsecured Indebtedness, provided that the aggregate
outstanding principal amount of such Indebtedness, together with the
aggregate amount of Indebtedness secured by Liens permitted under Section
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9.06(j) hereof, shall not at any time exceed 15% of Total Assets at such
time.
9.12 Restrictive Agreements.
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into, incur or permit to exist any agreement or
other arrangement that prohibits, restricts or imposes any condition upon the
ability of any Subsidiary to pay dividends or other distributions with respect
to any shares of its capital stock or to make or repay loans or advances to the
Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or
any other Subsidiary; provided that the foregoing shall not apply to (x)
restrictions and conditions imposed by law or by this Agreement, (y)
restrictions and conditions existing on the date hereof identified on Part A of
Schedule II (but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition) and (z)
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder.
9.13 Limitation on Lines of Business.
The Borrower will not enter into any business, either directly or through
any Subsidiary, to any substantial extent other than those businesses in which
the Borrower, Alliance and their respective Subsidiaries are engaged on the date
of this Agreement and, in each case, activities directly related thereto or
ancillary, complementary or reasonably related thereto as reasonably determined
by the Borrower in its sole judgment.
9.14 Debt Incurrence.
The Borrower will use its best efforts to cause the Borrower or one or more
of its Subsidiaries to incur Indebtedness in respect of bonds, debentures, notes
or similar instruments, as promptly as practicable after the Closing Date, to
enable the prepayment of the Loans hereunder as required by Section 2.10.
Section 10. Events of Default.
If one or more of the following events (herein called "Events of Default")
shall occur and be continuing:
(a) The Borrower shall default in the payment when due (whether at
stated maturity or upon optional or mandatory prepayment) of any principal
of any Loan payable by it hereunder, or shall default for three or more
Business Days in the payment when due (whether at stated maturity or upon
prepayment) of any interest on any Loan or any fee or any other amount
payable under this Agreement; or
(b) Any representation, warranty or certification made or deemed made
herein (or in any modification or supplement hereto) by the Borrower, or in
any certificate furnished to any Bank or the Administrative Agent pursuant
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to the provisions hereof, shall prove to have been false or misleading as
of the time made or deemed made or furnished in any material respect; or
(c) The Borrower or any of its Subsidiaries shall fail to make any
payment (whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become due
and payable; or
(d) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits (with or without the giving of notice, the lapse of time or
both) the holder or holders of any Material Indebtedness or any trustee or
agent on its or their behalf to cause any Material Indebtedness to become
due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity; provided that this clause (d)
shall not apply to secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the Property or assets securing such
Indebtedness; or
(e) The Borrower shall default in the performance of any of its
obligations under any of Sections 9.01(g), 9.05, 9.06, 9.07 or 9.08 hereof;
or the Borrower shall default in the performance of any of its other
obligations in this Agreement and such default shall continue unremedied
for a period of 30 days after notice thereof to the Borrower by the
Administrative Agent or any Bank (through the Administrative Agent); or
(f) The Borrower or any of its Subsidiaries shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts become
due; or
(g) The Borrower or any of its Subsidiaries shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee, examiner or liquidator of itself or of all or a
substantial part of its Property, (ii) make a general assignment for the
benefit of its creditors, (iii) commence a voluntary case under the
Bankruptcy Code, (iv) file a petition seeking to take advantage of any
other law relating to bankruptcy, insolvency, reorganization, liquidation,
dissolution, arrangement or winding-up, or composition or readjustment of
debts, (v) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it in an involuntary
case under the Bankruptcy Code, (vi) take any corporate action for the
purpose of effecting any of the foregoing or (vii) do the equivalent of any
of the foregoing under the laws of any non-U.S. jurisdiction (including, in
the case of Canada, the Bankruptcy and Insolvency Act (Canada), the
Companies Creditors Arrangement Act (Canada) or the Winding Up Act
(Canada)); or
(h) A proceeding or case shall be commenced, without the application
or consent of the Borrower or any of its Subsidiaries, in any court of
competent jurisdiction, seeking (i) its reorganization, liquidation,
dissolution, arrangement or winding-up, or the composition or readjustment
of its debts, (ii) the appointment of a receiver, custodian, trustee,
examiner, liquidator or the like of the Borrower or such Subsidiary or of
all or any substantial part of its Property, (iii) similar relief in
respect of the Borrower or such Subsidiary under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts, and such proceeding or case shall continue undismissed
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for a period of 60 or more days or (iv) the equivalent of any of the
foregoing under any non-U.S. jurisdiction (including, in the case of
Canada, the Bankruptcy and Insolvency Act (Canada), the Companies Creditors
Arrangement Act (Canada) or the Winding Up Act (Canada)); or an order,
judgment or decree approving or ordering any of the foregoing shall be
entered against the Borrower or such Subsidiary in an involuntary case
under the Bankruptcy Code; or
(i) A final judgment or judgments for the payment of money in excess
of $10,000,000 in the aggregate (exclusive of judgment amounts fully
covered by insurance where the insurer has admitted liability in respect of
such judgment) or in excess of $50,000,000 in the aggregate (regardless of
insurance coverage) shall be rendered by one or more courts, administrative
tribunals or other bodies having jurisdiction against the Borrower or any
of its Subsidiaries and the same shall not be discharged (or provision
shall not be made for such discharge), or a stay of execution thereof shall
not be procured, within 30 days from the date of entry thereof and the
Borrower or the relevant Subsidiary shall not, within said period of 30
days, or such longer period during which execution of the same shall have
been stayed, appeal therefrom and cause the execution thereof to be stayed
during such appeal; or
(j) An event or condition specified in Section 9.01(e) hereof shall
occur or exist with respect to any Plan or Multiemployer Plan and, as a
result of such event or condition, together with all other such events or
conditions, the Borrower or any ERISA Affiliate shall incur or in the
opinion of the Majority Banks shall be reasonably likely to incur a
liability to a Plan, a Multiemployer Plan or PBGC (or any combination of
the foregoing) which would constitute, in the determination of the Majority
Banks, a Material Adverse Effect; or
(k) A reasonable basis shall exist for the assertion against the
Borrower or any of its Subsidiaries of (or there shall have been asserted
against the Borrower or any of its Subsidiaries) claims or liabilities,
whether accrued, absolute or contingent, based on or arising from the
generation, storage, transport, handling or disposal of hazardous materials
(within the meaning of any Environmental Law) by the Borrower or any of its
Subsidiaries, or any predecessor in interest of the Borrower or any of its
Subsidiaries, or relating to any site or facility owned, operated or leased
by the Borrower or any of its Subsidiaries, which claims or liabilities
(insofar as they are payable by the Borrower or any of its Subsidiaries but
after deducting any portion thereof which is reasonably expected to be paid
by other creditworthy Persons jointly and severally liable therefor), in
the judgment of the Majority Banks are reasonably likely to be determined
adversely to the Borrower or any of its Subsidiaries, and the amount
thereof is, singly or in the aggregate, reasonably likely to have a
Material Adverse Effect; or
(l) During any period of 25 consecutive calendar months, a majority of
the Board of Directors of the Borrower shall no longer be composed of
individuals (i) who were members of said Board on the first day of such
period, (ii) whose election or nomination to said Board was approved by
individuals referred to in clause (i) above constituting at the time of
such election or nomination at least a majority of said Board or (iii)
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whose election or nomination to said Board was approved by individuals
referred to in clauses (i) and (ii) above constituting at the time of such
election or nomination at least a majority of said Board;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (g) or (h) of this Section 10 with respect to the Borrower, (A) the
Administrative Agent may and, upon request of the Majority Banks, shall, by
notice to the Borrower, terminate the Commitments and they shall thereupon
terminate, and (B) the Administrative Agent may and, upon request of Banks
having more than 50% of the aggregate unpaid principal amount of the Loans
shall, by notice to the Borrower declare the principal amount then outstanding
of, and the accrued interest on, the Loans and all other amounts payable by the
Borrower hereunder (including, without limitation, any amounts payable under
Section 5.05 hereof) to be forthwith due and payable, whereupon such amounts
shall be immediately due and payable without presentment, demand, protest or
other formalities of any kind, all of which are hereby expressly waived by the
Borrower; and (2) in the case of the occurrence of an Event of Default referred
to in clause (g) or (h) of this Section 10 with respect to the Borrower, the
Commitments shall automatically be terminated and the principal amount then
outstanding of, and the accrued interest on, the Loans and all other amounts
payable by the Borrower hereunder (including, without limitation, any amounts
payable under Section 5.05 hereof) shall automatically become immediately due
and payable without presentment, demand, protest or other formalities of any
kind, all of which are hereby expressly waived by the Borrower.
Section 11. The Administrative Agent.
11.01 Appointment, Powers and Immunities.
Each Bank hereby irrevocably appoints and authorizes the Administrative
Agent to act as its agent hereunder with such powers as are specifically
delegated to the Administrative Agent by the terms of this Agreement, together
with such other powers as are reasonably incidental thereto. The Administrative
Agent (which term as used in this sentence and in Section 11.05 and the first
sentence of Section 11.06 hereof shall include reference to its affiliates and
its own and its affiliates' officers, directors, employees and agents):
(a) shall have no duties or responsibilities except those expressly
set forth in this Agreement, and shall not by reason of this Agreement be a
trustee for any Bank;
(b) shall not be responsible to the Banks for any recitals,
statements, representations or warranties contained in this Agreement, or
in any certificate or other document referred to or provided for in, or
received by any of them under, this Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement, or any other document referred to or provided for herein or for
any failure by the Borrower or any other Person to perform any of its
obligations hereunder or thereunder;
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(c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder; and
(d) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under any other document or instrument referred to
or provided for herein or in connection herewith, except for its own gross
negligence or willful misconduct.
The Administrative Agent may employ agents and attorneys-in-fact and shall not
be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith.
11.02 Reliance by Administrative Agent.
The Administrative Agent shall be entitled to rely upon any certification,
notice or other communication (including, without limitation, any thereof by
telephone, telecopy, telegram or cable) reasonably 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. As to any
matters not expressly provided for by this Agreement, the Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with instructions given by the Majority Banks, and such
instructions of the Majority Banks and any action taken or failure to act
pursuant thereto shall be binding on all of the Banks.
11.03 Defaults.
The Administrative Agent shall not be deemed to have knowledge or notice of
the occurrence of a Default (other than the non-payment of principal of or
interest on Loans or of facility fee) unless the Administrative Agent has
received notice from a Bank or the Borrower specifying such 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, the Administrative
Agent shall give prompt notice thereof to the Banks (and shall give each Bank
prompt notice of each such non-payment). The Administrative Agent shall (subject
to Sections 11.01, 11.07 and 12.04 hereof) take such action with respect to such
Default as shall be directed by the Majority Banks, provided that, unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable in the best interest of the Banks except to the extent that this
Agreement expressly requires that such action be taken, or not be taken, only
with the consent or upon the authorization of the Majority Banks or all of the
Banks.
11.04 Rights as a Bank.
With respect to its Commitment and the Loans made by it, Chase (and any
successor acting as Administrative Agent) in its capacity as a Bank hereunder
shall have the same rights and powers hereunder as any other Bank and may
exercise the same as though it were not acting as the Administrative Agent, and
the term "Bank" or "Banks" shall, unless the context otherwise indicates,
include the Administrative Agent in its individual capacity. Chase (and any
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successor acting as Administrative Agent) and its affiliates may (without having
to account therefor to any Bank) accept deposits from, lend money to, make
investments in and generally engage in any kind of banking, trust or other
business with the Borrower (and any of its Subsidiaries or Affiliates) as if it
were not acting as the Administrative Agent, and Chase (and any such successor)
and its affiliates may accept fees and other consideration from the Borrower for
services in connection with this Agreement or otherwise without having to
account for the same to the Banks.
11.05 Indemnification.
The Banks agree to indemnify the Administrative Agent (to the extent not
reimbursed under Section 12.03 hereof, but without limiting the obligations of
the Borrower under said Section 12.03) ratably in accordance with the aggregate
principal amount of the Loans held by the Banks (or, if no Loans shall be
outstanding, ratably in accordance with their respective Commitments), for any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against the
Administrative Agent (including by any Bank) arising out of or by reason of any
investigation in or in any way relating to or arising out of this Agreement or
any other documents contemplated by or referred to herein or the transactions
contemplated hereby (including, without limitation, the costs and expenses that
the Borrower is obligated to pay under Section 12.03 hereof but excluding,
unless a Default has occurred and is continuing, normal administrative costs and
expenses incident to the performance of its agency duties hereunder) or the
enforcement of any of the terms hereof or of any such other documents, provided
that no Bank 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.
11.06 Non-Reliance on Administrative Agent and Other Banks.
Each Bank agrees that it has, independently and without reliance on the
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Borrower 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 Bank, 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. The Administrative Agent shall
not be required to keep itself informed as to the performance or observance by
the Borrower of this Agreement or any other document referred to or provided for
herein or to inspect the Properties or books of the Borrower or any of its
Subsidiaries. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the affairs,
financial condition or business of the Borrower or any of its Subsidiaries (or
any of their affiliates) that may come into the possession of the Administrative
Agent or any of its affiliates.
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11.07 Failure 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 receive further assurances to its
satisfaction from the Banks of their indemnification obligations under Section
11.05 hereof against any and all liability and expense that may be incurred by
it by reason of taking or continuing to take any such action.
11.08 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 notice thereof to the Banks and the Borrower, and the Administrative
Agent may be removed at any time with or without cause by the Majority Banks.
Upon any such resignation or removal, the Majority Banks shall have the right to
appoint a successor Administrative Agent. If no successor Administrative Agent
shall have been so appointed by the Majority Banks and shall have accepted such
appointment within 30 days after the retiring Administrative Agent's giving of
notice of resignation or the Majority Banks' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Banks, appoint a successor Administrative Agent, that shall be a bank which
has an office in New York, New York and which has a combined capital and surplus
of at least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent 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 Section 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 12. Miscellaneous.
12.01 Waiver.
No failure on the part of the Administrative Agent or any Bank to exercise
and no delay in exercising, and no course of dealing with respect to, any right,
power or privilege under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.
12.02 Notices.
All notices, requests and other communications provided for herein
(including, without limitation, any modifications of, or waivers or consents
under, this Agreement) shall be given or made in writing (including, without
limitation, by telecopy), delivered to the intended recipient as follows:
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(a) if to the Borrower, to Bowater Incorporated at 00 Xxxx Xxxxxxxxxx
Xxx, Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention of Treasurer (Telecopy No.
000-000-0000; Telephone No. 000-000-0000);
(b) if to the Administrative Agent, to it at The Chase Manhattan Bank,
0 Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Agency
Services Group (Telecopy No. 000-000-0000; Telephone No. 000-000-0000); and
(c) if to a Bank, to it at its address (or telecopy number) set forth
in its Administrative Questionnaire.
Any party hereto may change its address, telecopier number or telephone number
for notices and other communications hereunder by notice to the other parties
hereto (which notice, in the case of any such change by a Bank, shall be given
by such Bank to the Borrower and the Administrative Agent). Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
12.03 Expenses, Etc.
The Borrower agrees to pay or reimburse: (a) the Arranger and the
Administrative Agent for paying all reasonable out-of-pocket costs and expenses
of the Arranger and the Administrative Agent (including, without limitation, to
the extent separately agreed between the Administrative Agent and the Borrower,
the reasonable fees and expenses of Milbank, Tweed, Xxxxxx & XxXxxx LLP, special
New York counsel to Chase) in connection with (i) the negotiation, preparation,
execution and delivery of this Agreement and the making of the Loans hereunder,
(ii) the negotiation and preparation of any modification, supplement or waiver
of any of the terms of this Agreement (whether or not consummated), and (iii)
the syndication of the credit facilities provided for herein; (b) each Bank and
the Administrative Agent for paying its reasonable out-of-pocket costs and
expenses (including, without limitation, the reasonable fees and expenses of its
legal counsel) in connection with (i) any Default and any enforcement or
collection proceedings resulting therefrom, (ii) the negotiation of any
restructuring or "work-out" (whether or not consummated) of the obligations of
the Borrower hereunder and (iii) the enforcement of this Section 12.03; and (c)
each Bank and the Administrative Agent for paying all transfer, stamp,
documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement or any other
document referred to herein.
The Borrower hereby agrees to indemnify the Arranger, the Administrative
Agent and each Bank and their respective directors, officers, employees,
attorneys and agents from, and hold each of them harmless against, any and all
losses, liabilities, claims, damages and expenses incurred by any of them
(including, without limitation, any and all losses, liabilities, claims, damages
and expenses incurred by the Administrative Agent to any Bank, whether or not
the Administrative Agent or any Bank is a party thereto) arising out of or by
reason of any investigation or litigation or other proceedings (including any
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threatened investigation or litigation or other proceedings) relating to the
extensions of credit hereunder or any actual or proposed use by the Borrower or
any of its Subsidiaries of the proceeds of any of the extensions of credit
hereunder, including, without limitation, the reasonable fees and disbursements
of counsel incurred in connection with any such investigation or litigation or
other proceedings (but excluding any such losses, liabilities, claims, damages
or expenses incurred by reason of the gross negligence or willful misconduct of
the Person to be indemnified). Without limiting the generality of the foregoing,
the Borrower will indemnify the Arranger, the Administrative Agent and each Bank
from, and hold the Arranger, the Administrative Agent and each Bank harmless
against, any losses, liabilities, claims, damages or expenses described in the
preceding sentence (but excluding, as provided in the preceding sentence, any
loss, liability, claim, damage or expense incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified) arising under
any Environmental Law as a result of the past, present or future operations of
the Borrower or any of its Subsidiaries (or any predecessor in interest to the
Borrower or any of its Subsidiaries), or the past, present or future condition
of any site or facility owned, operated or leased by the Borrower or any of its
Subsidiaries (or any such predecessor in interest), or any release (within the
meaning of any Environmental Law) or threatened release of any hazardous
materials (within the meaning of any Environmental Law) from any such site or
facility, including any such release or threatened release which shall occur
during any period when the Administrative Agent or any Bank shall be in
possession of any such site or facility following the exercise by the
Administrative Agent or any Bank of any of its rights and remedies hereunder.
12.04 Amendments, Etc.
Except as otherwise expressly provided in this Agreement, any provision of
this Agreement may be modified or supplemented only by an instrument in writing
signed by the Borrower, the Administrative Agent and the Majority Banks, or by
the Borrower and the Administrative Agent acting with the consent of the
Majority Banks, and any provision of this Agreement may be waived by the
Majority Banks or by the Administrative Agent acting with the consent of the
Majority Banks; provided that:
(a) no modification, supplement or waiver shall, unless by an
instrument signed by all of the Banks or by the Administrative Agent acting
with the consent of all of the Banks: (i) increase or extend the term of
the Commitments, or extend the time or waive any requirement for the
reduction or termination of the Commitments, (ii) extend any date fixed for
the payment of principal of or interest on any Loan or any fee hereunder,
(iii) reduce the amount of any such payment of principal, (iv) reduce the
rate at which interest is payable thereon or any fee is payable hereunder,
(v) alter the rights or obligations of the Borrower to prepay Loans, (vi)
alter the terms of any of Sections 2.07, 4.07, 5 and 12.03 hereof or this
Section 12.04, (vii) modify the definition of the term "Majority Banks" or
modify in any other manner the number or percentage of the Banks required
to make any determinations or waive any rights hereunder or to modify any
provision hereof, or (viii) waive any of the conditions precedent set forth
in Section 7 hereof; and
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(b) any modification or supplement of Section 11 hereof, or of any of
the rights or duties of the Administrative Agent hereunder, shall require
the consent of the Administrative Agent.
12.05 Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
12.06 Assignments and Participations.
(a) Assignment by the Borrower. The Borrower may not assign all or any
portion of its rights or obligations hereunder without the prior consent of all
of the Banks and the Administrative Agent.
(b) Assignment by the Banks. Each Bank may assign all or any portion of its
Loans and its Commitment (but only with the consent of the Borrower and the
Administrative Agent, which consent may not be unreasonably withheld or
delayed); provided that
(i) (A) no such consent by the Borrower or the Administrative Agent
shall be required in the case of any assignment to another Bank or to an
Affiliate of any Bank, and (B) no such consent by the Borrower shall be
required if an Event of Default under clause (g) or (h) of Section 10 has
occurred and is continuing;
(ii) except for any assignment described by clause (i)(A) above, and
except to the extent the Borrower and the Administrative Agent shall
otherwise consent, any such partial assignment shall be in an amount at
least equal to $10,000,000;
(iii) each such assignment by a Bank of its Loans or Commitment shall
be made in such manner so that the same portion of its Loans and Commitment
is assigned to the respective assignee; and
(iv) upon each such assignment, the assignor and assignee shall
deliver to the Borrower and the Administrative Agent an Assignment and
Acceptance in the form of Exhibit A hereto.
Upon each such assignment the assigning Bank shall pay the Administrative Agent
an assignment fee of $3,500.
(c) Participations. A Bank may sell or agree to sell to one or more other
Persons (each a "Participant") a participation in all or any part of any Loans
held by it, or in its Commitment, provided that such Participant shall not have
any other rights or obligations under this Agreement (the Participant's rights
against such Bank in respect of such participation to be those set forth in the
agreements executed by such Bank in favor of the Participant). All amounts
payable by the Borrower to any Bank under Section 5 hereof in respect of Loans
held by it, and its Commitment, shall be determined as if such Bank had not sold
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or agreed to sell any participations in such Loans and Commitment, and as if
such Bank were funding each of such Loan and Commitment in the same way that it
is funding the portion of such Loan and Commitment in which no participations
have been sold. In no event shall a Bank that sells a participation agree with
the Participant to take or refrain from taking any action hereunder except that
such Bank may agree with the Participant that it will not, without the consent
of the Participant, agree to (i) increase or extend the term of such Bank's
Commitment, (ii) extend any date fixed for the payment of principal of or
interest on the related Loan or Loans or any portion of any fee hereunder
payable to the Participant, (iii) reduce the amount of any such payment of
principal, (iv) reduce the rate at which interest is payable thereon, or any fee
hereunder payable to the Participant, to a level below the rate at which the
Participant is entitled to receive such interest or fee, or (v) consent to any
modification, supplement or waiver hereof to the extent that the same, under
Section 12.04 hereof, requires the consent of each Bank.
(d) Federal Reserve Banks. In addition to the assignments and
participations permitted under the foregoing provisions of this Section 12.06,
any Bank may assign and pledge all or any portion of its Loans to any Federal
Reserve Bank as collateral security pursuant to Regulation A and any Operating
Circular issued by such Federal Reserve Bank. No such assignment shall release
the assigning Bank from its obligations hereunder.
(e) Information. A Bank may furnish any information concerning the Borrower
or any of its Subsidiaries in the possession of such Bank from time to time to
assignees and participants (including prospective assignees and participants),
subject, however, to the provisions of Section 12.12(b) hereof.
(f) Assignment to the Borrower. Anything in this Section 12.06 to the
contrary notwithstanding, the Borrower shall not, and shall not permit any of
its Subsidiaries to, acquire (whether by assignment, participation or
otherwise), and no Bank may assign or participate to the Borrower or any of its
Subsidiaries or Affiliates, any interest in any Loan without the prior consent
of each Bank.
(g) Register. The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Banks, and the Commitments of, and
principal amount of the Loans owing to, each Bank pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Banks may treat
each Person whose name is recorded in the Register pursuant to the terms hereof
as a Bank hereunder for all purposes of this Agreement, notwithstanding notice
to the contrary. The Register shall be available for inspection by the Borrower
or any Bank, at any reasonable time and from time to time upon reasonable prior
notice.
(h) Effectiveness of Assignments. Upon its receipt of a duly completed
Assignment and Acceptance executed by an assigning Bank and an assignee, the
assignee's completed Administrative Questionnaire (unless the assignee shall
already be a Bank hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section 12.06 and any written consent to such assignment
required by paragraph (b) of this Section 12.06, the Administrative Agent shall
accept such Assignment and Acceptance and record the information contained
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therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
12.07 Survival.
The obligations of the Borrower under Sections 5.01, 5.05, 5.06, 5.07 and
12.03 hereof and the obligations of the Banks under Section 11.05 hereof shall
survive the repayment of the Loans and the termination of the Commitments. In
addition, each representation and warranty made, or deemed to be made by a
notice of any Loan, herein or pursuant hereto shall survive the making of such
representation and warranty, and no Bank shall be deemed to have waived, by
reason of making any Loan, any Default which may arise by reason of such
representation or warranty proving to have been false or misleading,
notwithstanding that such Bank or the Administrative Agent may have had notice
or knowledge or reason to believe that such representation or warranty was false
or misleading at the time such Loan was made.
12.08 Captions.
The table of contents and captions and section headings appearing herein
are included solely for convenience of reference and are not intended to affect
the interpretation of any provision of this Agreement.
12.09 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 of the
parties hereto may execute this Agreement by signing any such counterpart.
12.10 Governing Law; Submission to Jurisdiction.
This Agreement shall be governed by, and construed in accordance with, the
law of the State of New York. The Borrower hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York state court sitting in New York City for the
purposes of all legal proceedings arising out of or relating to this Agreement
or the transactions contemplated hereby. The Borrower irrevocably waives, to the
fullest extent permitted by applicable law, any objection which it may now or
hereafter have to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum.
12.11 Waiver of Jury Trial.
EACH OF THE BORROWER, THE ADMINISTRATIVE AGENT AND THE BANKS HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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12.12 No Immunity.
To the extent that the Borrower may be or become entitled, in any
jurisdiction in which judicial proceedings may at any time be commenced with
respect to this Agreement, to claim for itself or its Properties or revenues any
immunity from suit, court jurisdiction, attachment prior to judgment, attachment
in aid of execution of a judgment, execution of a judgment or from any other
legal process or remedy relating to its obligations under this Agreement, and to
the extent that in any such jurisdiction there may be attributed such an
immunity (whether or not claimed), the Borrower hereby irrevocably agrees not to
claim and hereby irrevocably waives such immunity to the fullest extent
permitted by the laws of such jurisdiction.
12.13 Judgment Currency.
This is an international loan transaction in which the specification of
U.S. Dollars and payment in New York City is of the essence, and the obligations
of the Borrower under this Agreement to make payment to (or for the account of)
a Bank in U.S. Dollars shall not be discharged or satisfied by any tender or
recovery pursuant to any judgment expressed in or converted into any other
currency or in another place except to the extent that such tender or recovery
results in the effective receipt by such Bank in New York City of the full
amount of U.S. Dollars payable to such Bank under this Agreement. If for the
purpose of obtaining judgment in any court it is necessary to convert a sum due
hereunder in U.S. Dollars into another currency (in this Section 12.13 called
the "judgment currency"), the rate of exchange that shall be applied shall be
that at which in accordance with normal banking procedures the Administrative
Agent could purchase U.S. Dollars at its principal office in New York City with
the judgment currency on the Business Day next preceding the day on which such
judgment is rendered. The obligation of the Borrower in respect of any such sum
due from it to the Administrative Agent or any Bank hereunder (in this Section
12.13 called an "Entitled Person") shall, notwithstanding the rate of exchange
actually applied in rendering such judgment, be discharged only to the extent
that on the Business Day following receipt by such Entitled Person of any sum
adjudged to be due hereunder in the judgment currency such Entitled Person may
in accordance with normal banking procedures purchase and transfer U.S. Dollars
to New York City with the amount of the judgment currency so adjudged to be due;
and the Borrower hereby, notwithstanding any such judgment, agrees to indemnify
such Entitled Person against, and to pay such Entitled Person on demand, in U.S.
Dollars, the amount (if any) by which the sum originally due to such Entitled
Person in U.S. Dollars hereunder exceeds the amount of U.S. Dollars so purchased
and transferred.
12.14 Use of English Language.
This Agreement has been negotiated and executed in the English language.
All certificates, reports, notices and other documents and communications given
or delivered pursuant to this Agreement (including, without limitation, any
modifications or supplements hereto) shall be in the English language, or
accompanied by a certified English translation thereof. Except in the case of
laws or official communications of the Netherlands, in the case of any document
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originally issued in a language other than English, the English language version
of any such document shall for purposes of this Agreement, and absent manifest
error, control the meaning of the matters set forth therein.
12.15 Treatment of Certain Information.
(a) Use of Information. The Borrower acknowledges that from time to time
financial advisory, investment banking and other services may be offered or
provided to it or one or more of its Subsidiaries (in connection with this
Agreement or otherwise) by any Bank or by one or more subsidiaries or affiliates
of such Bank and the Borrower hereby authorizes each Bank to share any
information delivered to such Bank by the Borrower or any of its Subsidiaries
pursuant to this Agreement, or in connection with the decision of such Bank to
enter into this Agreement, to any such subsidiary or affiliate of such Bank, it
being understood that any such subsidiary or affiliate receiving such
information shall be bound by the provisions of paragraph (b) below as if it
were a Bank hereunder. Such authorization shall survive the repayment of the
Loans and the termination of the Commitments.
(b) Confidentiality. Each of the Banks and the Administrative Agent will,
and will cause its affiliates, directors, officers, employees and
representatives to, keep confidential, and not publish, disclose or otherwise
divulge and use only in connection with this Agreement any non-public
information furnished by the Borrower to it in respect of this Agreement that
the Borrower identifies as being confidential at the time it furnishes the same,
directly or indirectly (including through the Arranger), including a
Confidential Information Memorandum relating to the Borrower and information
relating to Alliance or its Subsidiaries (collectively, the "Information"),
provided that nothing herein shall limit the disclosure of the Information (i)
after the Information shall have become public (other than through a violation
of this Section 12.15(b)), (ii) to the extent required by statute, rule,
regulation or judicial process, (iii) to counsel for any of the Banks or the
Administrative Agent, (iv) to bank examiners (or any other regulatory authority
having jurisdiction over any Bank or the Administrative Agent), or to auditors
or accountants, (v) to the Administrative Agent or any other Bank (or to the
Arranger), (vi) in connection with any litigation to which any one or more of
the Banks or the Administrative Agent is a party, or in connection with the
enforcement of rights or remedies hereunder, (vii) to a subsidiary or affiliate
of such Bank as provided in paragraph (a) above or (viii) after the Arranger has
advised the Administrative Agent in writing that it has completed its
syndication efforts in respect of this Agreement, 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 Bank a Confidentiality Agreement substantially in the form of Exhibit
D hereto (or executes and delivers to such Bank an acknowledgement to the effect
that it is bound by the provisions of this Section 12.15(b), which
acknowledgement may be included as part of the respective assignment or
participation agreement pursuant to which such assignee or participant acquires
an interest in the Loans hereunder); provided, further, that (x) unless
specifically prohibited by applicable law or court order, each Bank and the
Administrative Agent shall, prior to disclosure thereof, notify the Borrower of
any request for disclosure of the Information (A) by any governmental agency or
representative thereof (other than any such request in connection with an
examination of the financial condition of such Bank by such governmental agency)
or (B) pursuant to legal process, and (y) in no event shall any Bank or the
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Administrative Agent be obligated or required to return the Information
furnished by the Borrower. The obligations of each Bank under this Section
12.15(b) shall supersede and replace the obligations of such Bank under any
confidentiality letter in respect of this financing signed and delivered by such
Bank to the Borrower prior to the date hereof; in addition, the obligations of
any assignee that has executed a Confidentiality Agreement in the form of
Exhibit D hereto shall be superseded by this Section 12.15(b) upon the date upon
which such assignee becomes a Bank hereunder pursuant to Section 12.06(b)
hereof.
Bridge Credit Agreement
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
BOWATER INCORPORATED
Witness: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------- ----------------------------------
Xxxxx Xxxxx Name: Xxxxxxx X. Xxxxxx
Title: Vice President and Treasurer
THE CHASE MANHATTAN BANK,
as Administrative Agent and a Bank
By: /s/ Xxxx X. Xxxxxxx
----------------------------------
Name:
Title:
Bridge Credit Agreement
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XXXXXXX SACHS CREDIT
PARTNERS, L.P.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
Bridge Credit Agreement
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BANK OF AMERICA, N.A.
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Managing Director
Bridge Credit Agreement
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SUNTRUST BANK
By: /s/ Xxxxxxx X. XxXxxxx
---------------------------------------
Name: Xxxxxxx X. XxXxxxx
Title: Managing Director
Senior Risk Officer
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BANK OF MONTREAL
By: /s/ Xxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxx Xxxxxx
Title: Executive Managing Director
Bridge Credit Agreement
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68
-00-
XXX XXXX XX XXX XXXX
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
Bridge Credit Agreement
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69
-00-
XXX XXXX XX XXXX XXXXXX
By: /s/ A.S. Xxxxxxxxxx
-----------------------------------
Name: A.S. Xxxxxxxxxx
Title: Sr. Team Leader - Loan Operations
Bridge Credit Agreement
-----------------------
00
-00-
XXXXXXX XXXXXXXX (XXXXX), INC.
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
Title: Vice President
Bridge Credit Agreement
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WACHOVIA BANK N.A.
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President
Bridge Credit Agreement
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72
SCHEDULE I
Commitments
[See definition of "Commitment" in Sections 1.01]
Bank Commitment
---- ----------
The Chase Manhattan Bank $ 150,000,000
Xxxxxxx Xxxxx Credit Partners, L.P. $ 150,000,000
Bank of America, N.A. $ 50,000,000
SunTrust Bank $ 50,000,000
Bank of Montreal $ 20,000,000
The Bank of New York $ 20,000,000
The Bank of Nova Scotia $ 20,000,000
Toronto Dominion (Texas), Inc. $ 20,000,000
Wachovia Bank N.A. $ 20,000,000
Schedule I
----------
73
SCHEDULE II
MATERIAL AGREEMENTS AND LIENS
-----------------------------
PART A. MATERIAL AGREEMENTS (US MILLIONS, UNLESS OTHERWISE NOTED)
See Section 8.12
BOWATER INCORPORATED
Public Bonds
9.0% Debentures due 8/1/09 $250.0
9.375% Debentures due 12/15/21 $200.0
9.5% Debentures due 10/15/12 $125.0
8.5% Notes due 12/15/01 $18.1
Tax Exempt Bonds
7.75% Solid Waste Recycling Facilities Revenue Bond due 10/1/22 $62.0
7.4% Solid Waste Recycling Facilities Revenue Bond due 12/1/22 $39.5
7.625% Solid Waste Recycling Facilities Revenue Bond due 3/1/16 $30.0
Variable Rate Solid Waste Recycling Facilities Revenue Bond due 6/1/29 $33.5
7.625% Solid Waste Recycling Facilities Revenue Bond due 3/1/06 $6.9
7.4% Solid Waste Recycling Facilities Revenue Bond due 1/1/10 $6.5
Letters of Credit
Supporting Workers Compensation $10.0
Supporting Variable Rate Solid Waste Recycling Facilities $34.8
Bank Agreements
$350 Million 5-Year Credit Agreement (as of 6/25/01) $341.6
$450 Million 364-day Credit Agreement (as of 6/25/01) $66.0
$10 Million Cash Management uncommitted line of credit (as of 6/25/01) $8.5
Guarantees
In connection with Ponderay Newsprint Company $50.0
In connection with the monetization of a timberland note $12.8
In connection with a synthetic lease $115.0
In connection with a letter of credit (employment related) C$22.0
issued by Bowater Pulp and Paper Canada Inc.
Synthetic Lease
$115 Million Facility due April 30, 2006 (as of 6/25/01) $11.3
Schedule II
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74
SCHEDULE II
(Continued)
BOWATER PULP AND PAPER CANADA
Public Bonds
10.85% Indenture due 11/30/14 C$125.0
9.25% Indenture due 6/15/02 $59.1
10.25% Indenture due 1/15/03 $7.4
Private Placement Notes
10.625% Series A Note Agreement due 6/15/10 $98.0
10.5% Series B Note Agreement due 6/15/10 $91.8
10.6% Series C Note Agreement due 1/15/11 $70.0
10.26% Series D Note Agreement due 1/15/11 $22.0
Letters of Credit
Supporting employment matters C$23.4
Bank Agreements
C$10 Million Cash Management line of credit (as of 6/25/01) C$8.2
C$5 Million Cash Management line of credit (as of 6/25/01) C$0.0
BOWATER MARITIMES INC.
Bank Agreements
C$17.3 Million Credit Agreement C$17.3
C$20 Million Cash Management line of credit C$5.4
ALLIANCE FOREST PRODUCTS INC.
Bank Agreements
Amended and Restated Credit Agreement dated as of (as of 6/29/01) $221.7
March 27, 1997, as amended and restated as of (as of 6/29/01) C$56.8
November 30, 1998 (C$510.8 Million maximum as of 12/31/00) (To be
repaid and terminated concurrently with the closing of the
Arrangement)
Schedule II
-----------
75
SCHEDULE II
(continued)
PART B. MATERIAL LIENS (US MILLIONS, UNLESS OTHERWISE NOTED)
See Section 9.06(a)
BOWATER INCORPORATED
Timber Note Monetizations $176.6
Synthetic Lease $115.0
AVENOR MARITIMES
C$20 Million Cash Management uncommitted line of credit C$20.0
Credit Agreement C$10.0
ALLIANCE FOREST PRODUCTS INC.
Amended and Restated Credit Agreement dated as of (as of 6/29/01) $221.7
March 27, 1997, as amended and restated as of (as of 6/29/01) C$56.8
November 30, 1998 (C$510.8 Million maximum as of 12/31/00) (To be
repaid and terminated concurrently with the closing of the
Arrangement)
Schedule II
-----------
76
Schedule III
Subsidiaries
PART A
BOWATER INCORPORATED
Name Jurisdiction of Incorporation
---- -----------------------------
Bowater America Inc. Delaware
Bowater Asia Pte Ltd Singapore
Bowater Canada Inc. Canada
Bowater Canadian Holdings Incorporated Nova Scotia
Bowater Canadian Limited Canada
Bowater Europe Limited United Kingdom
Bowater Finance Company Inc. Delaware
Bowater Foreign Sales Corporation Barbados
Bowater-Halla Paper Co., Ltd. Korea
Bowater Japan Limited Japan
Bowater Maritimes Inc. (1) New Brunswick
Bowater Mersey Paper Company Limited (2) Nova Scotia
Bowater Mississippi Holdings Inc. Delaware
Bowater Mississippi LLC Delaware
Bowater Newsprint South LLC Delaware
Bowater Nuway Inc. Delaware
Bowater Pulp and Paper Canada Inc. Canada
Bowater S. America Ltda. Brazil
Bowater South American Holdings Incorporated Delaware
Bowater Ventures Inc. Delaware
Xxxxxxx Newsprint Company(3) Delaware
Carolina Export Corporation Delaware
Cascapedia Booming Company Inc. Canada
Enerpap Inc. Canada
Lake Superior Forest Products Inc. Delaware
Lake Superior Holdings Inc. Delaware
Newsprint South, Inc. Delaware
Note: Except as otherwise indicated, each of the above entities is a wholly
owned direct or indirect subsidiary of the Company.
(1) 67 percent owned
(2) 51 percent owned
(3) Approximately 51 percent owned
Schedule III
------------
77
SCHEDULE III
Subsidiaries
PART A
ALLIANCE FOREST PRODUCTS INC.
Name Jurisdiction of Incorporation
---- -----------------------------
U.S. Alliance Holding Corp. Delaware
Alliance Forest Products U.S. Corp. Alabama
Coosa Pines Golf Club, Incorporated Alabama
Alliance Forest Products Baie-Trinite Inc. Quebec
Alliance Forest Products-Treated Wood Inc. Quebec
Alliance Forest Products-Mitis Inc. Quebec
9068-9050 Quebec Inc. Quebec
Alliance Forest Products-Xxxxxxxx Inc. Quebec
3733505 Canada Inc. Canada
Alliance Forest Products-Couturier Inc. New Brunswick
Note: Each of the above entities is a wholly owned direct or indirect
subsidiary of the Company.
Schedule III
------------
78
SCHEDULE III
(continued)
PART B
See Section 8.14
ALLIANCE FOREST PRODUCTS INC.
Amended and Restated Credit Agreement dated as of March 27, 1997, as amended (as of 6/29/01) $221.7
and restated as of November 30, 1998 (C$510.8 Million maximum as of 12/31/00) (as of 6/29/01) C$56.8
(To be repaid and terminated concurrently with the closing of the Arrangement)
Schedule III
------------
79
SCHEDULE IV
Litigation
[See Section 8.03]
None
Schedule IV
-----------
80
SCHEDULE V
Permitted Dispositions
[See Section 9.05(f)]
timberlands located in the southeastern United States that support the Company's
Catawba operations
Schedule V
----------
81
EXHIBIT A
[Form of Assignment and Acceptance]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Bridge Credit Agreement dated as of
July [__], 2001 (as amended and in effect on the date hereof, the "Credit
Agreement"), among Bowater Incorporated, the banks party thereto and The Chase
Manhattan Bank, as Administrative Agent for said banks. Terms defined in the
Credit Agreement are used herein with the same meanings.
The Assignor named on the reverse hereof hereby sells and
assigns, without recourse, to the Assignee named on the reverse hereof, and the
Assignee hereby purchases and assumes, without recourse, from the Assignor,
effective as of the Assignment Date set forth on the reverse hereof, the
interests set forth on the reverse hereof (the "Assigned Interest") in the
Assignor's rights and obligations under the Credit Agreement, including the
interests set forth on the reverse hereof in the Commitment of the Assignor on
the Assignment Date and Loans owing to the Assignor which are outstanding on the
Assignment Date, together with unpaid interest accrued on the assigned Loans to
the Assignment Date, and the amount, if any, set forth on the reverse hereof of
the fees accrued to the Assignment Date for the account of the Assignor. The
Assignee hereby acknowledges receipt of a copy of the Credit Agreement. From and
after the Assignment Date (i) the Assignee shall be a party to and be bound by
the provisions of the Credit Agreement and, to the extent of the interests
assigned by this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent of the interests
assigned by this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
This Assignment and Acceptance is being delivered to the
Administrative Agent together with if the Assignee is not already a Bank under
the Credit Agreement, an Administrative Questionnaire in the form supplied by
the Administrative Agent, duly completed by the Assignee. The
[Assignee/Assignor] shall pay the fee payable to the Administrative Agent
pursuant to Section 12.06(b) of the Credit Agreement.
This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.
Assignment and Acceptance
-------------------------
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Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date")(1):
Percentage Assigned of
Facility/Commitment
(set forth, to at
least 8 decimals, as a
percentage of the
Facility and the
aggregate Commitments
Principal Amount of all Banks
Facility Assigned thereunder)
-------- -------- -----------
Commitment Assigned: $ %
Loans:
Fees Assigned (if any):
The terms set forth above and on the reverse side hereof are hereby agreed to:
[NAME OF ASSIGNOR] , as Assignor
------------------------
By:
------------------------------------------
Name:
Title:
---------------------------
(1) Must be at least ive Business Days after execution hereof by all required
parties.
Assignment and Acceptance
-------------------------
83
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[NAME OF ASSIGNEE] , as Assignee
------------------------
By:
------------------------------------------
Name:
Title:
Assignment and Acceptance
-------------------------
84
-4-
The undersigned hereby consent to the within assignment:(2)
BOWATER INCORPORATED
By:_________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By:_________________________
Name:
Title:
-------------------------------
(2) Consents to be included to the extent required by Section 12.06(b) of the
Credit Agreement.
Assignment and Acceptance
-------------------------
85
EXHIBIT B
[Form of Opinion of Counsel to the Borrower]
__________ __, 2001
Each of the Banks party to the
Bridge Credit Agreement referred to
below and The Chase Manhattan Bank, as
Administrative Agent for said Banks
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
I am the Vice President, Secretary and Assistant General
Counsel of Bowater Incorporated, a corporation organized under the laws of
Delaware (the "Borrower") and I am delivering this opinion pursuant to Section
7.01(d) of the Bridge Credit Agreement (the "Credit Agreement") dated as of July
[__], 2001, among the Borrower, the banks party thereto (the "Banks") and The
Chase Manhattan Bank, as Administrative Agent, providing for loans to be made by
said Banks to the Borrower in an aggregate principal amount not exceeding
$500,000,000. All capitalized terms used but not defined herein have the
respective meanings given to such terms in the Credit Agreement.
In rendering the opinions expressed below, I have examined:
(i) the Credit Agreement; and
(ii) such corporate records, agreements and instruments of the
Borrower and such other documents and records as I have deemed
necessary as a basis for the opinions expressed below.
In my examination, I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals and
the conformity with authentic original documents of all documents submitted to
me as copies. When relevant facts were not independently established, I have
relied upon statements of governmental officials and upon representations made
in or pursuant to the Credit Agreement and certificates of appropriate
representatives of the Borrower.
In rendering the opinions expressed below, I have assumed,
with respect to all of the documents referred to in this opinion letter, that
(except, to the extent set forth in the opinions expressed below, as to the
Borrower):
Opinion of Counsel to Borrower
------------------------------
86
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(i) such documents have been duly authorized by, have been
duly executed and delivered by, and constitute legal, valid, binding
and enforceable obligations of, all of the parties to such documents;
(ii) all signatories to such documents have been duly
authorized; and
(iii) all of the parties to such documents are duly organized
and validly existing and have the power and authority (corporate or
other) to execute, deliver and perform such documents.
Based upon and subject to the foregoing and subject also to
the comments and qualifications set forth below, and having considered such
questions of law as I have deemed necessary as a basis for the opinions
expressed below, I am of the opinion that:
1. The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
2. The Borrower has all requisite corporate power to execute
and deliver, and to perform its obligations under the Credit Agreement
and has all requisite corporate power to borrow under the Credit
Agreement.
3. The execution, delivery and performance by the Borrower of
the Credit Agreement and the borrowings by the Borrower under the
Credit Agreement have been duly authorized by all necessary corporate
action on the part of the Borrower.
4. The Credit Agreement has been duly executed and delivered
by the Borrower.
5. The Credit Agreement constitutes the legal, valid and
binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other
similar laws relating to or affecting the rights of creditors generally
and except as the enforceability of the Credit Agreement is subject to
the application of general principles of equity (regardless of whether
considered in a proceeding in equity or at law), including, without
limitation, (a) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b) concepts of
materiality, reasonableness, good faith and fair dealing.
6. No authorization, approval or consent of, and no filing or
registration with, any governmental or regulatory authority or agency
is required on the part of the Borrower for the execution, delivery or
performance by the Borrower of, or for the legality, validity or
enforceability of, the Credit Agreement or for any borrowing by the
Borrower under the Credit Agreement.
7. The execution, delivery and performance by the Borrower of,
and the consummation by the Borrower of the transactions contemplated
by, the Credit Agreement do not and will not (a) violate any provision
of the charter or by-laws of the Borrower, (b) violate any applicable
law, rule or regulation in any material respect, (c) violate any order,
Opinion of Counsel to Borrower
------------------------------
87
-3-
writ, injunction or decree of any court or governmental authority or
agency or any arbitral award applicable to the Borrower of which I have
knowledge (after due inquiry) or (d) result in a breach of, constitute
a default under, require any consent under, or result in the
acceleration or required prepayment of any indebtedness pursuant to the
terms of, any agreement or instrument of which I have knowledge (after
due inquiry) to which the Borrower is a party or by which the Borrower
is bound or to which the Borrower is subject or result in the creation
or imposition of any Lien upon any Property of the Borrower or any of
its Subsidiaries pursuant to the terms of any such agreement or
instrument.
8. Except as set forth in Schedule IV to the Credit Agreement,
I have no knowledge (after due inquiry) of any legal or arbitral
proceedings, or any proceedings by or before any governmental or
regulatory authority or agency, now pending or threatened against the
Borrower or any of its Subsidiaries or any of their respective
Properties that, if adversely determined, could have a Material Adverse
Effect.
The foregoing opinions are subject to the following comments
and qualifications:
A. The enforceability of Section 12.03 of the Credit Agreement
may be limited by (i) laws rendering unenforceable indemnification
contrary to Federal or state securities laws and the public policy
underlying such laws and (ii) laws limiting the enforceability of
provisions exculpating or exempting a party, or requiring
indemnification of a party for, liability for its own action or
inaction, to the extent the action or inaction involves gross
negligence, recklessness, willful misconduct or unlawful conduct.
B. The enforceability of provisions in the Credit Documents
to the effect that terms may not be waived or modified except in
writing may be limited under certain circumstances.
C. I express no opinion as to (i) the effect of the laws of
any jurisdiction in which any Bank is located (other than the State of
New York) that limit the interest, fees or other charges such Bank may
impose, (ii) Section 4.07(c) of the Credit Agreement, (iii) the second
sentence of Section 12.10 of the Credit Agreement, insofar as such
sentence relates to the subject matter jurisdiction of the United
States District Court for the Southern District of New York to
adjudicate any controversy related to the Credit Documents, (iv) any
purported waiver of the right to trial by jury and (v) Section 12.12 of
the Credit Agreement, insofar as it purports to be a waiver of immunity
granted after the execution and delivery of the Credit Agreement.
The foregoing opinions are limited to matters involving the
Federal laws of the United States of America, the Delaware General Corporation
Law and the law of the State of New York and I do not express any opinion as to
the laws of any other jurisdiction.
At the request of my client, this opinion letter is, pursuant
to Section 7.01(d) of the Credit Agreement, provided to you by me in my capacity
as Vice President, Secretary and Assistant General Counsel of the Borrower and
Opinion of Counsel to the Borrower
----------------------------------
88
-4-
may not be relied upon, used, published or communicated by any Person for any
purpose other than in connection with the transactions contemplated by the
Credit Agreement without, in each instance, my prior written consent.
Very truly yours,
Opinion of Counsel to Borrower
------------------------------
89
EXHIBIT C
[Form of Opinion of Special New York
Counsel to Chase]
___________ __, 2001
Each of the Banks party to the
Bridge Credit Agreement referred to
below and The Chase Manhattan Bank, as
Administrative Agent for said Banks
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
We have acted as special New York counsel to The Chase
Manhattan Bank ("Chase") in connection with the Bridge Credit Agreement dated as
of July [__], 2001 (the "Credit Agreement") among Bowater Incorporated (the
"Borrower"), the banks party thereto (the "Banks") and Chase, as Administrative
Agent, providing for loans to be made by said Banks to the Borrower in an
aggregate principal amount not exceeding $500,000,000. All capitalized terms
used but not defined herein have the respective meanings given to such terms in
the Credit Agreement. This opinion letter is being delivered pursuant to Section
7.01(e) of the Credit Agreement.
In rendering the opinion expressed below, we have examined:
(i) the Credit Agreement; and
Opinion of Special New York Counsel to Chase
--------------------------------------------
90
-2-
(ii) such corporate records of the Borrower and such other
documents as we have deemed necessary as a basis for the opinion
expressed below.
In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity with authentic original documents of all documents submitted to
us as copies. When relevant facts were not independently established, we have
relied upon statements of governmental officials and upon representations made
in or pursuant to the Credit Agreement and certificates of appropriate
representatives of the Borrower.
In rendering the opinion expressed below, we have assumed,
with respect to all of the documents referred to in this opinion letter, that:
(i) such documents have been duly authorized by, have been
duly executed and delivered by, and (except to the extent set forth in
the opinion below as to the Borrower) constitute legal, valid, binding
and enforceable obligations of, all of the parties to such documents;
(ii) all signatories to such documents have been duly
authorized; and
(iii) all of the parties to such documents are duly organized
and validly existing and have the power and authority (corporate or
other) to execute, deliver and perform such documents.
Based upon and subject to the foregoing and subject also to
the comments and qualifications set forth below, and having considered such
questions of law as we have deemed necessary as a basis for the opinion
expressed below, we are of the opinion that the Credit Agreement constitutes the
legal, valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other similar
laws relating to or affecting the rights of creditors generally and except as
the enforceability of the Credit Agreement is subject to the application of
general principles of equity (regardless of whether considered in a proceeding
in equity or at law), including, without limitation, (a) the possible
unavailability of specific performance, injunctive relief or any other equitable
remedy and (b) concepts of materiality, reasonableness, good faith and fair
dealing.
The foregoing opinion is subject to the following comments and
qualifications:
A. The enforceability of Section 12.03 of the Credit Agreement
may be limited by (i) laws rendering unenforceable indemnification
contrary to Federal or state securities laws and the public policy
underlying such laws and (ii) laws limiting the enforceability of
provisions exculpating or exempting a party, or requiring
indemnification of a party for, liability for its own action or
inaction, to the extent the action or inaction involves gross
negligence, recklessness, willful misconduct or unlawful conduct.
Opinion of Special New York Counsel to Chase
--------------------------------------------
91
-3-
B. The enforceability of provisions in the Credit Documents to
the effect that terms may not be waived or modified except in writing
may be limited under certain circumstances.
C. We express no opinion as to (i) the effect of the laws of
any jurisdiction in which any Bank is located (other than the State of
New York) that limit the interest, fees or other charges such Bank may
impose, (ii) Section 4.07(c) of the Credit Agreement, (iii) the second
sentence of Section 12.10 of the Credit Agreement, insofar as such
sentence relates to the subject matter jurisdiction of the United
States District Court for the Southern District of New York to
adjudicate any controversy related to the Credit Agreement and (iv)
Section 12.12 of the Credit Agreement, insofar as it purports to be a
waiver of immunity granted after the execution and delivery of the
Credit Agreement.
The foregoing opinion is limited to matters involving the
Federal laws of the United States of America and the law of the State of New
York, and we do not express any opinion as to the laws of any other
jurisdiction.
At the request of our client, this opinion letter is, pursuant
to Section 7.01(e) of the Credit Agreement, provided to you by us in our
capacity as special New York counsel to Chase and may not be relied upon by any
Person for any purpose other than in connection with the transactions
contemplated by the Credit Agreement without, in each instance, our prior
written consent.
Very truly yours,
RJW/CDP
Opinion of Special New York Counsel to Chase
--------------------------------------------
92
EXHIBIT D
[Form of Confidentiality Agreement]
CONFIDENTIALITY AGREEMENT
[Date]
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Bridge Credit Agreement dated as of July [__], 2001 (as modified
and supplemented and in effect from time to time, the "Credit
Agreement"), among Bowater Incorporated (the "Borrower"), the
banks party thereto and The Chase Manhattan Bank, as
Administrative Agent.
Dear Ladies and Gentlemen:
As a Bank party to the Credit Agreement, we have agreed with
the Borrower pursuant to Section 12.15 of the Credit Agreement to use reasonable
precautions to keep confidential, except as otherwise provided therein, all
non-public information identified by the Borrower as being confidential at the
time the same is delivered to us pursuant to the Credit Agreement, including a
Confidential Information Memorandum relating to the Borrower and information
relating to Alliance Forest Products Inc. and its subsidiaries (collectively,
the "Information").
As provided in said Section 12.15, we are permitted to provide
you, as a prospective [holder of a participation in the Loans (as defined in the
Credit Agreement)] [assignee Bank], with the Information subject to the
execution and delivery by you, prior to receiving the Information, of a
Form of Confidentiality Agreement
---------------------------------
93
-2-
Confidentiality Agreement in this form. The 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 for
the benefit of the Borrower and us to keep confidential, and to not publish,
disclose or otherwise divulge, the Information (and to cause your officers,
directors, employees, agents and representatives to keep confidential, and to
not publish, disclose or otherwise divulge, the Information) and, at the
Borrower's request (except as provided below), promptly to return to the
Borrower or destroy the Information and all copies thereof, extracts therefrom
and analyses or other materials based thereon, except that you shall be
permitted to disclose Information (i) to such of your officers, directors,
employees, agents and representatives as need to know such Information in
connection with the proposed [participation] [assignment] mentioned above; (ii)
to the extent required by applicable laws or regulations or by any subpoena or
similar legal process, or requested by any bank regulatory authority, provided
that, unless specifically prohibited by applicable law or court order, you
agree, prior to disclosure thereof, to notify the Borrower of any request for
disclosure of any Information (A) by any governmental agency or representative
thereof (other than any such request in connection with an examination of your
financial condition by a governmental agency) or (B) pursuant to legal process;
(iii) to the extent such Information (A) becomes publicly available other than
as a result of a breach of this Confidentiality Agreement, (B) becomes available
to you on a non-confidential basis from a source other than the Administrative
Agent, any Bank or us (C) was available to you on a non-confidential basis prior
to its disclosure to you by us; (iv) to the extent the Borrower shall have
consented to such disclosure in writing; or (v) pursuant to the immediately
succeeding paragraph of this Confidentiality Agreement. You further agree that
you will use the Information (except to the extent the conditions referred to in
subclauses (A), (B) and (C) of clause (iii) above have been met and as otherwise
provided in this paragraph) only to evaluate the proposed [participation]
[assignment] in respect of the Credit Agreement.
Notwithstanding anything to the contrary contained above, if
you become [a holder of a participation in the Loans under the Credit Agreement,
you will be entitled (subject to the requirements hereof) to retain all
Information and to use it in monitoring and servicing such participation and in
exercising your rights with respect thereto] [an assignee Bank pursuant to
Section 12.06(b) of the Credit Agreement, you will be able to retain all
Information pursuant and subject to Section 12.15 of the Credit Agreement, which
shall supersede your obligations under this Confidentiality Agreement on the
date upon which you become such a Bank].
This Agreement shall be governed by the law of the State of
New York.
Form of Confidentiality Agreement
---------------------------------
94
-3-
Please indicate your agreement to the foregoing by signing as
provided below the enclosed copy of this Confidentiality Agreement and returning
the same to us.
Very truly yours,
[INSERT NAME OF BANK]
By_________________________
The foregoing is agreed to as of the date of this letter.
[INSERT NAME OF PROSPECTIVE
PARTICIPANT OR ASSIGNEE]
By_________________________
Form of Confidentiality Agreement
---------------------------------
