SWING NOTE
Exhibit 10.3
| $25,000,000.00 | Pittsburgh, Pennsylvania September 30, 2009 |
FOR VALUE RECEIVED, the undersigned, Erie Insurance Exchange, a reciprocal or inter-insurance
exchange domiciled in the Commonwealth of Pennsylvania, acting by and through Erie Indemnity
Company, a Pennsylvania corporation, its attorney-in-fact (the “Borrower”), hereby promises to pay
to the order of PNC Bank, National Association (“PNC Bank”) the lesser of (i) the principal sum of
Twenty-Five Million and 00/100 Dollars ($25,000,000.00) or (ii) the aggregate unpaid principal
balance of all Swing Loans made by the Bank to the Borrower pursuant to Section 2.1.2 [Swing Loan
Commitment] of the Credit Agreement dated of even date herewith (as may be amended, modified,
supplemented or restated from time to time, the “Credit Agreement”), by and among the Borrower,
the Lenders party thereto and PNC Bank, as administrative agent for the Lenders (the
“Administrative Agent”), payable in accordance with the terms of the Credit Agreement. All
capitalized terms used herein shall, unless otherwise defined herein, have the same meanings given
to such terms in the Credit Agreement.
The Borrower shall pay interest on the unpaid principal balance hereof from time to time
outstanding from the date hereof at the rate per annum specified by the Borrower pursuant to
Section 3.1 [Interest Rate Options] of, or as otherwise provided in, the Credit Agreement.
Upon the occurrence of an Event of Default which is continuing, the Borrower shall pay
interest on the entire principal amount of the then outstanding Swing Loans evidenced by this Swing
Note at a rate per annum specified by Section 3.3 [Interest After Default] of, or as otherwise
provided in, the Credit Agreement. Such interest rate will accrue before and after any judgment has
been entered.
Subject to the provisions of the Credit Agreement, interest on this Swing Note will be
payable on the dates set forth in Section 4.5 [Interest Payment Dates] of the Credit Agreement and
on the Expiration Date.
Subject to the provisions of the Credit Agreement, if any payment or action to be made or
taken hereunder shall be stated to be or become due on a day which is not a Business Day, such
payment or action shall be made or taken on the next following Business Day and such extension of
time shall be included in computing interest or fees, if any, in connection with such payment or
action.
Subject to the provisions of the Credit Agreement, payments of both principal and interest
shall be made without setoff, counterclaim or other deduction of any nature at the office of the
Administrative Agent located at Xxx XXX Xxxxx, 000 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000,
xx xxxxxx xxxxx xx xxx Xxxxxx Xxxxxx of America in immediately available funds.
This Swing Note is one of the Notes referred to in, and is entitled to the benefits of, the
Credit Agreement and the other Loan Documents, including the representations, warranties,
covenants, conditions and Liens contained or granted therein. The Credit Agreement, among other
things, contains provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayment in certain circumstances, on account of principal hereof
prior to maturity upon the terms and conditions therein specified.
The Borrower waives presentment, demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or enforcement of this Swing Note.
THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS SWING NOTE (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). THE
BORROWER (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT THIS WAIVER CONSTITUTES A MATERIAL
INDUCEMENT FOR PNC BANK TO ACCEPT THIS SWING NOTE AND MAKE THE SWING LOANS.
This Swing Note shall bind the Borrower and its successors and assigns, and the benefits
hereof shall inure to the benefit of the Administrative Agent and the Lenders and their respective
successors and assigns. All references herein to the “Borrower”, the “Administrative Agent” and
the “Lenders” shall be deemed to apply to the Borrower, the Administrative Agent and the Lenders,
respectively, and their respective successors and assigns.
This Swing Note and any other documents delivered in connection herewith and the rights and
obligations of the parties hereto and thereto shall for all purposes be governed by, and construed
and enforced in accordance with, the internal Laws of the Commonwealth of Pennsylvania without
giving effect to its conflicts of law principles.
PNC Bank may at any time pledge all or a portion of its rights under the Loan Documents
including any portion of this Swing Note to any of the twelve (12) Federal Reserve Banks organized
under Section 4 of the Federal Reserve Act, 12 U.S.C. § 341. No such pledge or enforcement thereof
shall release PNC Bank from its obligations under any of the Loan Documents.
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IN WITNESS WHEREOF, and intending to be legally bound, the undersigned has executed this Swing
Note on the day and year first above written, with the intention that it constitute a sealed
instrument.
| BORROWER |
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| WITNESS: | Erie Insurance Exchange | ||||
| /s/ Xxxxx X. Xxxxxx | By: | Erie Indemnity Company, a Pennsylvania corporation, its Attorney-in-Fact |
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| By: | /s/ Xxxxxxx X. Xxxxxxx | (SEAL) | |||
| Name: | Xxxxxxx X. Xxxxxxx | ||||
| Title: | Senior Vice President, Treasurer and Chief Investment Officer |
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