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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 3)
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Wallace Computer Services, Inc.
(Name of Subject Company)
FRDK, INC.
(Bidder)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS
(Title of Class of Securities)
932270101
(CUSIP Number of Class of Securities)
JOSEPH M. DUANE, ESQ.
FRDK, INC.
1 FIRST CANADIAN PLACE
TORONTO, ONTARIO, CANADA M5X 1GF
(416) 364-2600
(Name, Address and Telephone Number of Persons Authorized to
Receive Notices and Communications on Behalf of Bidder)
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COPY TO:
DENNIS J. FRIEDMAN, ESQ.
DAVID M. WILF, ESQ.
DAVID M. SCHWARTZBAUM, ESQ.
CHADBOURNE & PARKE LLP
30 ROCKEFELLER PLAZA
NEW YORK, NY 10112
(212) 408-5100
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<PAGE>
FRDK, Inc. hereby amends and supplements its Tender Offer Statement on
Schedule 14D-1 (as amended, the "Statement"), originally filed on August 2,
1995, with respect to its offer to purchase all outstanding shares of Common
Stock, par value $1.00 per share, of Wallace Computer Services, Inc., a Delaware
corporation, (together with the associated preferred stock purchase rights), as
set forth in this Amendment No. 3. Capitalized terms not defined herein shall
have the meanings assigned thereto in the Statement.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On August 10, 1995, Moore and the Purchaser entered into definitive
loan arrangements with Scotiabank for a US $1,100,000,000 revolving credit
facility (the "Credit Agreement"). The proceeds of the loans will be used (i) to
finance, in part, the acquisition of up to all of the outstanding Shares and pay
expenses related to such acquisition (including certain restructuring costs
following that acquisition) and (ii) for general corporate purposes of Moore,
the Purchaser and their direct and indirect subsidiaries. Moore has guaranteed
the Purchaser's payment obligations under the Credit Facility.
The Credit Agreement provides that interest on the loans outstanding
under the Credit Facility will bear interest, at the Purchaser's option, at
either Scotiabank's (i) alternate base rate or (ii) reserve-adjusted LIBO rate
plus 25.0 basis points. A commitment fee will be paid with respect to the daily
average unused portion of the Credit Facility commitment amount (whether or not
then available), in an amount equal to 7.0 basis points per annum. The
commitment fee began to accrue on the date the Commitment Letter was executed by
Moore.
The Credit Agreement provides that the Credit Facility will mature on
August 8, 1996.
The Credit Agreement includes conditions precedent customary for the
type of transaction proposed including, without limitation: (i) for the first
borrowing under the Credit Facility, no material adverse change in the financial
condition, operations, or prospects of Moore on a consolidated basis since
December 31, 1994; and for each subsequent borrowing under the Credit Facility,
no material adverse change in the financial condition, operations, or properties
of Moore on a consolidated basis since December 31, 1994; (ii) receipt of
closing certificates, opinions of counsel, and related documentation customary
for the type of transaction involved; (iii) no event of default or condition
which with, the giving of notice or the passage of time (or both) would
constitute an event of default shall have occurred and be continuing; and (iv)
representations and warranties made in the Credit Agreement are accurate in all
material respects.
The Credit Agreement contains representations and warranties from both
the Purchaser and Moore that are customary for transactions of similar size and
type.
The Credit Agreement contains affirmative and negative covenants
customary for transactions of similar size and type, and these covenants are
binding on both the Purchaser and Moore. Under the Credit Agreement, these
covenants include, without limitation, restrictions on the incurrence of liens
or other encumbrances by Moore and its subsidiaries, except for the following:
(a) liens and encumbrances covering margin stock (including the outstanding
shares of the Company), (b) liens and encumbrances securing indebtedness not to
exceed US $100,000,000 in the aggregate, and (c) certain other negotiated
exceptions.
The Credit Agreement includes certain financial covenants. One of
these is a specified maximum consolidated total debt to total capitalization
ratio (defined as total debt of specified types (including indebtedness for
borrowed money, capitalized lease obligations, letter of credit repayment
obligations) to the sum of such debt plus book equity) of Moore not to exceed
55% (all accounting terms to be interpreted, and all accounting determinations
and computations to be made, in accordance with Canadian generally accepted
accounting principles, as conformed to U.S. generally accepted accounting
principles). Another financial covenant restricts the maximum amount of
purchase-money debt and specified contingent liabilities, including guarantees,
in respect of debt issued by persons that are not majority-owned subsidiaries of
Moore.
The Credit Agreement contains customary events of default, including
without limitation (i) a cross-default to other indebtedness of Moore or any of
its subsidiaries, with a principal amount in excess of U.S. $25,000,000 (subject
to certain exceptions, including inter-company indebtedness where the relevant
defaults have been waived by the holder of such indebtedness), and (ii) a
"Change of Control" (as defined in the Credit Agreement) of Moore.
The Credit Agreement contains certain other customary provisions,
including indemnification rights for "Lenders" (as defined in the Credit
Agreement), assignment and participation rights for Lenders, expense payment
undertakings, waivers of jury trial, choice of law provisions and other terms
specified in the Credit Agreement.
The foregoing summary of the Credit Agreement does not purport to be
complete and is qualified in its entirety by reference to the Credit Agreement,
a copy of which are attached hereto as an exhibit.
ITEM 10. ADDITIONAL INFORMATION.
The Purchaser hereby waives the Financing Condition. See Item 4.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(11) Press Release, dated August 10, 1995.
(b)(2) Credit Agreement, dated as of August 10, 1995, by and among
FRDK, Inc., as the Borrower, Moore Corporation Limited, as the
Guarantor, Certain Commercial Banks, as the Lenders, and The
Bank of Nova Scotia, as Agent for the Lenders.
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is
true, complete and correct.
Dated: August 11, 1995
FRDK, Inc.
By: /s/ Joseph M. Duane
Name: Joseph M. Duane
Title: President
<PAGE>
EXHIBIT INDEX
(a)(11) Press Release, dated August 10, 1995.
(b)(2) Credit Agreement, dated as of August 10, 1995, by and among
FRDK, Inc., as the Borrower, Moore Corporation Limited, as the
Guarantor, Certain Commercial Banks, as the Lenders, and The
Bank of Nova Scotia, as Agent for the Lenders.
Hilda Mackow
Vice President of Communications
Moore Corporation Limited
(416) 366-4740
Lissa Perlman
Kekst and Company
(212) 593-2655
MOORE CORPORATION WAIVES FINANCING CONDITION
TORONTO (August 10, 1995) -- Moore Corporation Limited (TSE, ME, NYSE: MCL)
announced today that it has entered into definitive loan arrangements with
respect to its tender offer for all of the outstanding shares of Wallace
Computer Services (NYSE: WCS) at US$56 per share in cash. Moore Corporation has
therefore waived the financing condition to its offer. Moore and its
wholly-owned subsidiary today completed definitive loan documentation with The
Bank of Nova Scotia to provide up to US$1.1 billion in financing for the
transaction. This financing together with existing funds will be sufficient to
fund Moore's tender offer for all of Wallace's outstanding shares.
The Bank of Nova Scotia will act as lead agent and will syndicate the financing
to a select group of United States, Canadian, and overseas co-agents and other
participating banks.
###
Moore Corporation Limited is a global leader in delivering information handling
products and services that create efficiency and enhance competitiveness for
customers. Founded in Toronto in 1882, Moore has approximately 20,000 employees
and over 100 manufacturing facilities serving customers in 59 countries. Sales
in 1994 were US$2.4 billion.
U.S. $1,100,000,000
CREDIT AGREEMENT,
dated as of August 10, 1995,
among
FRDK, INC.,
as the Borrower,
MOORE CORPORATION LIMITED,
as the Guarantor,
CERTAIN COMMERCIAL BANKS,
as the Lenders
and
THE BANK OF NOVA SCOTIA,
as the Agent for the Lenders.
<PAGE>
TABLE OF CONTENTS
SECTION PAGE
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms...................................................... 1
1.2. Use of Defined Terms............................................... 13
1.3. Cross-References................................................... 13
1.4. Accounting and Financial Determinations............................ 14
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
2.1. Commitments........................................................ 14
2.1.1. Commitment of Each Lender.......................................... 14
2.1.2. Lenders Not Permitted or Required To Make Loans.................... 14
2.2. Reduction of Commitment Amount..................................... 14
2.3. Borrowing Procedure................................................ 15
2.4. Continuation and Conversion Elections.............................. 15
2.5. Funding............................................................ 15
2.6. Notes.............................................................. 16
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments......................................... 16
3.2. Interest Provisions................................................ 17
3.2.1. Rates.............................................................. 17
3.2.2. Post-Maturity Rates................................................ 18
3.2.3. Payment Dates...................................................... 18
3.3. Fees............................................................... 19
3.3.1. Commitment Fee..................................................... 19
3.3.2. Other Fees......................................................... 19
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful......................................... 20
4.2. Deposits Unavailable............................................... 20
4.3. Increased LIBO Rate Loan Costs, etc................................ 20
4.4. Funding Losses..................................................... 21
4.5. Increased Capital Costs............................................ 21
4.6. Taxes.............................................................. 22
4.7. Payments, Computations, etc........................................ 23
<PAGE>
SECTION PAGE
4.8. Sharing of Payments................................................ 24
4.9. Setoff............................................................. 25
4.10. Replacement of Lenders............................................. 25
ARTICLE V
CONDITIONS TO BORROWING
5.1. Initial Borrowing.................................................. 26
5.1.1. Resolutions, etc................................................... 26
5.1.2. Delivery of Notes.................................................. 26
5.1.3. Opinions of Counsel................................................ 26
5.1.4. Closing Fees, Expenses, etc........................................ 26
5.1.5. Satisfactory Legal Form............................................ 26
5.2. All Borrowings..................................................... 27
5.2.1. Compliance with Warranties, No Default, etc........................ 27
5.2.2. Borrowing Request.................................................. 27
5.2.3. Satisfactory Legal Form............................................ 27
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc.................................................. 27
6.2. Due Authorization, Non-Contravention, etc.......................... 28
6.3. Government Approval, Regulation, etc............................... 28
6.4. Validity, etc...................................................... 29
6.5. Financial Information.............................................. 29
6.6. No Material Adverse Change......................................... 29
6.7. Litigation, Labor Controversies, etc............................... 29
6.8. Ownership of Properties............................................ 29
6.9. Taxes.............................................................. 30
6.10. Pension and Welfare Plans.......................................... 30
6.11. Environmental Warranties........................................... 30
6.12. Regulations G, T, U and X.......................................... 32
6.13. Accuracy of Information............................................ 32
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants.............................................. 32
7.1.1. Financial Information, Reports, Notices, etc....................... 33
7.1.2. Compliance with Laws, etc.......................................... 34
7.1.3. Books and Records.................................................. 35
7.1.4. Environmental Covenant............................................. 35
7.1.5. Use of Proceeds.................................................... 35
7.2. Negative Covenants................................................. 35
7.2.1. Business Activities................................................ 35
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<PAGE>
SECTION PAGE
7.2.2. Indebtedness....................................................... 36
7.2.3. Liens.............................................................. 36
7.2.4. Contingent Obligations............................................. 38
7.2.5. Dissolution, etc................................................... 38
7.2.6. Transactions with Affiliates....................................... 38
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default....................................... 38
8.1.1. Non-Payment of Obligations......................................... 38
8.1.2. Breach of Warranty................................................. 39
8.1.3. Non-Performance of Certain Covenants and Obligations............... 39
8.1.4. Non-Performance of Other Covenants and Obligations................. 39
8.1.5. Default on Other Indebtedness...................................... 39
8.1.6. Judgment........................................................... 40
8.1.7. Pension Plans...................................................... 40
8.1.8. Change in Control.................................................. 41
8.1.9. Bankruptcy, Insolvency, etc........................................ 41
8.2. Action if Bankruptcy............................................... 41
8.3. Action if Other Event of Default................................... 42
ARTICLE IX
THE AGENT
9.1. Actions............................................................ 42
9.2. Funding Reliance, etc.............................................. 43
9.3. Exculpation........................................................ 43
9.4. Successor.......................................................... 43
9.5. Loans by Scotiabank................................................ 44
9.6. Credit Decisions................................................... 44
9.7. Copies, etc........................................................ 44
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc........................................... 45
10.2. Notices............................................................ 46
10.3. Payment of Costs and Expenses...................................... 46
10.4. Indemnification.................................................... 47
10.5. Survival........................................................... 48
10.6. Severability....................................................... 48
10.7. Headings........................................................... 48
10.8. Execution in Counterparts, Effectiveness, etc...................... 48
10.9. Governing Law; Entire Agreement.................................... 49
10.10. Successors and Assigns............................................. 49
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SECTION PAGE
10.11. Sale and Transfer of Loans and Note; Participations in
Loans and Note................................................... 49
10.11.1. Assignments........................................................ 49
10.11.2. Participations..................................................... 51
10.12. Other Transactions................................................. 52
10.13. Forum Selection and Consent to Jurisdiction........................ 52
10.14. Waiver of Jury Trial............................................... 53
ARTICLE XI
GUARANTY PROVISIONS
11.1. Guaranty........................................................... 53
11.2. Acceleration of Guaranty........................................... 53
11.3. Guaranty Absolute, etc............................................. 54
11.4. Reinstatement, etc................................................. 55
11.5. Waiver, etc........................................................ 55
11.6. Postponement of Subrogation, etc................................... 55
11.7. Judgment........................................................... 56
SCHEDULE I - Disclosure Schedule
EXHIBIT A - Form of Note
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Lender Assignment Agreement
EXHIBIT E - Form of Opinion of New York Counsel
to the Obligors
EXHIBIT F - Form of Opinion of Canadian Counsel
to the Obligors
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<PAGE>
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of August 10, 1995, among FRDK, INC., a New
York corporation (the "Borrower"), MOORE CORPORATION LIMITED, an Ontario
corporation (the "Guarantor"), the various commercial banks as are or may become
parties hereto (collectively, the "Lenders"), and THE BANK OF NOVA SCOTIA
("Scotiabank"), as agent (the "Agent") for the Lenders.
W I T N E S S E T H:
WHEREAS, the Borrower is a wholly-owned Subsidiary of the Guarantor; and
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
pursuant to which Loans, in a maximum aggregate principal amount at any one time
outstanding not to exceed $1,100,000,000, will be made to the Borrower from time
to time prior to the Commitment Termination Date; and
WHEREAS, the Guarantor desires to unconditionally guarantee the obligations
of the Borrower hereunder; and
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article V), to extend such
Commitments and make such Loans to the Borrower; and
WHEREAS, the proceeds of such Loans will be used (i) to finance in part the
acquisition of up to all of the issued and outstanding shares of capital stock
of Wallace Computer Services, Inc., a Delaware corporation ("WCSI"), and to pay
expenses arising in connection with such acquisition (including certain
restructuring costs arising subsequent to and as a result of such acquisition)
and (ii) for general corporate purposes of the Guarantor, the Borrower and their
direct and indirect Subsidiaries (including the acquisition of other businesses,
subject to Section 7.2.1);
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
<PAGE>
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted basis)
having ordinary voting power for the election of directors or managing
general partners; or
(b) to direct or cause the direction of the management and policies of
such Person whether by contract or otherwise.
"Agent" is defined in the preamble and includes each other Person as shall
have subsequently been appointed as the successor Agent pursuant to Section 9.4.
"Agreement" means, on any date, this Credit Agreement as originally in
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to all Base Rate
Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest most recently established by Scotiabank at
its Domestic Office as its base rate for Dollar loans; and
(b) the Federal Funds Rate most recently determined by the Agent plus
1/2 of 1%.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by Scotiabank in connection with extensions of credit.
Changes in the rate of interest on that portion of any Loans maintained as Base
Rate Loans will take effect simultaneously with each change in the Alternate
Base Rate. The Agent will give notice promptly to the Borrower and the Lenders
of changes in the Alternate Base Rate.
"Assignee Lender" is defined in Section 10.11.1.
"Authorized Officer" means, relative to either Obligor, those of its
officers whose signatures and incumbency shall have been certified to the Agent
and the Lenders pursuant to Section 5.1.1.
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<PAGE>
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Borrower" is defined in the preamble.
"Borrowing" means the Loans of the same type and, in the case of LIBO Rate
Loans, having the same Interest Period made by all Lenders on the same Business
Day and pursuant to the same Borrowing Request in accordance with Section 2.1.
"Borrowing Request" means a loan request and certificate duly executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit B
hereto.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor a legal holiday
on which banks are authorized or required to be closed in New York City,
Toronto, Canada, Chicago, Illinois or Atlanta, Georgia; and
(b) relative to the making, continuing, prepaying or repaying of any
LIBO Rate Loans, any day on which dealings in Dollars are carried on in the
London interbank market.
"Capitalized Lease Liabilities" means all monetary obligations of the
Guarantor or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases, and,
for purposes of this Agreement and each other Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a penalty.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of
(x) beneficial ownership (within the meaning of Rules 13d-3 and
13d-5 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended) of, or
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<PAGE>
(y) the right to acquire (whether such right is exercisable
immediately, after the passage of time, upon the happening of an event
or otherwise, but excluding any such right that is subject to the
consent of the Required Lenders hereunder)
30% or more of the outstanding shares of the stock of the Guarantor having the
power to vote for the election of directors of the Guarantor, on a fully diluted
basis.
"Code" means the Internal Revenue Code of 1986, as amended or otherwise
modified from time to time.
"Commitment" means, relative to any Lender, such Lender's obligation to
make Loans pursuant to Section 2.1.1.
"Commitment Amount" means, on any date, $1,100,000,000, as such amount may
be reduced from time to time pursuant to Section 2.2.
"Commitment Termination Date" means the earliest of
(a) August 8, 1996;
(b) the date on which the Commitment Amount is terminated in full or
reduced to zero pursuant to Section 2.2; and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the Commitments
shall terminate automatically and without further action.
"Commitment Termination Event" means
(a) the occurrence of any Event of Default described in clauses (a)
through (d) of Section 8.1.9 with respect to either Obligor; or
(b) the occurrence and continuance of any other Event of Default and
either
(i) the declaration of the Loans to be due and payable pursuant
to Section 8.3, or
(ii) in the absence of such declaration, the giving of notice by
the Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
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<PAGE>
"Contingent Liability" means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability at any time
shall (subject to any limitation set forth therein) be deemed to be the
outstanding principal amount of the debt, obligation or other liability
guaranteed thereby at such time.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
"Controlled Group" means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Guarantor, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Debt" means the outstanding amount of all Indebtedness of the Guarantor
and its Subsidiaries of the type referred to in clauses (a), (b) and (c) of the
definition of "Indebtedness", determined on a consolidated basis for the
Guarantor and its Subsidiaries.
"Default" means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Agent and the Required
Lenders.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such Lender
designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) within the United States as may be designated from time
to time
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<PAGE>
by notice from such Lender, as the case may be, to each other Person party
hereto.
"Effective Date" means the date this Agreement becomes effective pursuant
to Section 10.8.
"Environmental Laws" means all applicable federal, state, provincial or
local statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to public health
and safety and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"Event of Default" is defined in Section 8.1.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York; or
(b) if such rate is not so published for any day which is a Business
Day, the average of the quotations for such day on such transactions
received by Scotiabank from three federal funds brokers of recognized
standing selected by it.
"Fee Letter" means the confidential letter, dated August 3, 1995, between
the Guarantor and Scotiabank.
"Fiscal Quarter" means any quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive calendar months ending
on December 31; references to a Fiscal Year with a number corresponding to any
calendar year (e.g. the "1995 Fiscal Year") refer to the Fiscal Year ending on
the December 31 occurring during such calendar year.
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
or any successor thereto.
"GAAP" is defined in Section 1.4.
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<PAGE>
"Guarantor" is defined in the preamble.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation and
Recovery Act;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other applicable
federal, state, provincial or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders) relating
to or imposing liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material, all as amended or
hereafter amended.
"Hedging Obligations" means, with respect to any Person, all liabilities of
such Person under interest rate swap agreements, interest rate cap agreements
and interest rate collar agreements, and all other agreements or arrangements
designed to protect such Person against fluctuations in interest rates or
currency exchange rates.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial statement
of the Guarantor, any qualification or exception to such opinion or
certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause
the Guarantor to be in default of any of its obligations under Section
7.2.2.
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<PAGE>
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capitalized Lease
Liabilities;
(d) all other items which, in accordance with GAAP, would be included
as liabilities on the liability side of the balance sheet of such Person as
of the date at which Indebtedness is to be determined;
(e) net amounts owing by such Person under all Hedging Obligations
(after giving effect to amounts owed to such Person under such Hedging
Obligations which it is permitted to set off against amounts payable by it
thereunder or any defense to payment it may have, including as a result of
a default by a counterparty);
(f) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse; and
(g) all Contingent Liabilities of such Person in respect of any of the
foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint
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venturer which has liability as a general partner, unless, in any such case, no
holder of such Indebtedness has any recourse to such Person in respect thereof.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Interest Period" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or 2.4
and shall end on (but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that
(a) the Borrower shall not be permitted to select Interest Periods to
be in effect at any one time which have expiration dates occurring on more
than eight different dates;
(b) Interest Periods commencing on the same date for Loans comprising
part of the same Borrowing shall be of the same duration;
(c) if such Interest Period would otherwise end on a day which is not
a Business Day, such Interest Period shall end on the next following
Business Day (unless such next following Business Day is the first Business
Day of a calendar month, in which case such Interest Period shall end on
the Business Day next preceding such numerically corresponding day); and
(d) no Interest Period may end later than the date set forth in clause
(a) of the definition of "Commitment Termination Date".
"knowledge" means, in the context of a Borrowing other than the initial
Borrowing, with respect to the Guarantor or the Borrower, the actual knowledge
of the (a) the Chairman of the Guarantor, (b) the President or Chief Executive
Officer of the Guarantor, (c) the Chief Financial Officer of the Guarantor or
(d) the General Counsel of the Guarantor.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit D hereto.
"Lenders" is defined in the preamble.
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"Leverage Ratio" means, as of any date of determination, the ratio of
(a) Debt
to
(b) Total Capitalization.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, relative to any Lender, the office of such Lender
designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender as designated from time to
time by notice from such Lender to the Borrower and the Agent, whether or not
outside the United States, which shall be making or maintaining LIBO Rate Loans
of such Lender hereunder; provided that any such designation shall not increase
any amount payable pursuant to Section 4.5 or 4.6 hereof.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property to secure payment of a debt or
performance of an obligation or other priority or preferential arrangement of
any kind or nature whatsoever.
"Loan" is defined in Section 2.1.1.
"Loan Document" means this Agreement, the Notes, the Fee Letter, each
Borrowing Request and each Continuation/Conversion Notice.
"Material Adverse Effect" means any material adverse effect on (i) the
financial condition or operations of the Guarantor and its Subsidiaries (taken
as a whole) or (ii) the legality, validity or enforceability of this Agreement,
the Notes or any other Loan Document.
"Note" means a promissory note of the Borrower payable to any Lender, in
the form of Exhibit A hereto (as such promissory note may be amended, endorsed
or otherwise modified from time to time), evidencing the aggregate Indebtedness
of the Borrower to
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such Lender resulting from outstanding Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
"Obligations" means all obligations (monetary or otherwise) of the Borrower
and the Guarantor arising under or in connection with this Agreement and each
other Loan Document.
"Obligors" means the Borrower and the Guarantor.
"Organic Document" means, relative to either Obligor, its certificate of
incorporation, its by-laws and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its authorized shares of capital
stock.
"Participant" is defined in Section 10.11.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in section 4001(a)(3) of ERISA), and which is sponsored by the
Guarantor or any corporation, trade or business that is, along with the
Guarantor, a member of a Controlled Group.
"Percentage" means, relative to any Lender, the percentage set forth
opposite its signature hereto or set forth in the Lender Assignment Agreement,
as such percentage may be adjusted from time to time pursuant to Lender
Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and
delivered pursuant to Section 10.11.
"Permitted Liens" means any Lien permitted under Section 7.2.3(a) through
(n), inclusive.
"Person" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency or any other entity, whether
acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Quarterly Payment Date" means the last day of each March, June, September,
and December or, if any such day is not a Business Day, the next succeeding
Business Day.
"Release" means a "release", as such term is defined in CERCLA.
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"Relevant Indebtedness" is defined in Section 8.1.5.
"Relevant Person" means (a) the Guarantor, (b) the Borrower, (c) each
Significant Subsidiary and (d) each other Subsidiary of the Guarantor that, if
an Event of Default of the type described in Section 8.1.9 occurred with respect
to such other Subsidiary, it would reasonably be expected to have a Material
Adverse Effect.
"Replacement Notice" is defined in Section 4.10.
"Required Lenders" means, at any time, Lenders holding at least 51% of the
then aggregate outstanding principal amount of the Notes then held by the
Lenders, or, if no such principal amount is then outstanding, Lenders having at
least 51% of the Commitments.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
time.
"Scotiabank" is defined in the preamble.
"Significant Subsidiary" means each Subsidiary of the Guarantor that
(a) accounted for at least 10% of consolidated revenues of the
Guarantor and its Subsidiaries, in each case for the Fiscal Year of the
Guarantor immediately preceding the date as of which any such determination
is made (or, if such Subsidiary was not a Subsidiary of the Guarantor
during any portion of such Fiscal Year, would have accounted for at least
10% of consolidated revenues of the Guarantor and its Subsidiaries if it
had been a Subsidiary of the Guarantor during all of such Fiscal Year) and
as reflected on the financial statements of the Guarantor for such period;
or
(b) has assets which represent at least 10% of the consolidated assets
of the Guarantor and its Subsidiaries as of the last day of the Fiscal Year
immediately preceding the date as of which any such determination is made
(or, if such Subsidiary was not a Subsidiary of the Guarantor as of the
last day of such Fiscal Year, would have had assets which represented at
least 10% of the consolidated assets of the Guarantor and its Subsidiaries
if it had been a Subsidiary of the Guarantor as of the last day of such
Fiscal Year) and as reflected on the financial statements of the Guarantor
as of such date.
"Stated Maturity Date" means August 8, 1996.
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"Subject Lender" is defined in Section 4.10.
"Subsidiary" means, with respect to any Person, any corporation of which
more than 50% of the outstanding capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Taxes" is defined in Section 4.6.
"Total Capitalization" shall mean, on any date of determination, the sum of
(i) Debt of the Guarantor and its Subsidiaries on a consolidated basis and (ii)
the amount, determined on a consolidated basis, in the capital stock account
plus (or minus in the case of a deficit) the additional paid-in capital and
retained earnings of the Guarantor and its Subsidiaries, and in any event, net
of the value of treasury stock in such capital stock account.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"WCSI" is defined in the preamble.
"Welfare Plan" means a "welfare plan", as such term is defined in section
3(1) of ERISA.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in this Agreement
shall have such meanings when used in the Disclosure Schedule and in each Note,
Borrowing Request, Continuation/Conversion Notice, Loan Document, notice and
other communication delivered from time to time in connection with this
Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
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SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 7.2.2) shall be made, and all financial
statements required to be delivered hereunder or thereunder shall be prepared in
accordance with, those generally accepted accounting principles in Canada as in
effect on December 31, 1994, provided that (x) for purposes of Section 7.2.2 and
for purposes of any certificate related to determining compliance with such
Section delivered pursuant to Section 7.1.1(b) or (c), such accounting
principles will be conformed to U.S. generally accepted accounting principles
and (y) for purposes of Sections 7.1.1 (a) and (b), the financial statements
referred to therein will be conformed to U.S. generally accepted accounting
principles to the extent required for the filing of the Guarantor's reports on
Forms 10-K and 10-Q of the Securities and Exchange Commission ("GAAP").
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement (including Article V), each Lender severally agrees to make Loans
pursuant to the Commitments described in this Section 2.1.
SECTION 2.1.1. Commitment of Each Lender. From time to time on any Business
Day occurring prior to the Commitment Termination Date, each Lender will make
loans (relative to such Lender, and of any type, its "Loans") to the Borrower
equal to such Lender's Percentage of the aggregate amount of the Borrowing
requested by the Borrower to be made on such day. On the terms and subject to
the conditions hereof, the Borrower may from time to time borrow, prepay and
reborrow Loans.
SECTION 2.1.2. Lenders Not Permitted or Required To Make Loans. No Lender
shall be permitted or required to make any Loan if, after giving effect thereto,
the aggregate outstanding principal amount of all Loans
(a) of all Lenders would exceed the Commitment Amount,
or
(b) of such Lender would exceed such Lender's Percentage of the
Commitment Amount.
SECTION 2.2. Reduction of Commitment Amount. The Borrower may, from time to
time on any Business Day, voluntarily reduce
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the Commitment Amount; provided, however, that all such reductions shall require
at least three Business Days' prior notice to the Agent and be permanent, and
any partial reduction of the Commitment Amount shall be in a minimum amount of
$1,000,000 and in an integral multiple of $1,000,000.
SECTION 2.3. Borrowing Procedure. By delivering a Borrowing Request to the
Agent on or before 10:00 a.m., New York City time, on a Business Day, the
Borrower may from time to time irrevocably request, on not less than one (in the
case of Base Rate Loans) and three (in the case of LIBO Rate Loans) nor more
than ten (in the case of all Loans) Business Days' notice, that a Borrowing be
made in a minimum amount of $1,000,000 and an integral multiple of $1,000,000,
or in the unused amount of the Commitments. On the terms and subject to the
conditions of this Agreement, each Borrowing shall be comprised of the type of
Loans, and shall be made on the Business Day, specified in such Borrowing
Request. On or before 11:00 a.m. (New York City time) on such Business Day each
Lender shall deposit with the Agent same day funds in an amount equal to such
Lender's Percentage of the requested Borrowing. Such deposit will be made to an
account which the Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the Agent shall make
such funds available to the Borrower by wire transfer to the accounts the
Borrower shall have specified in its Borrowing Request (and, if such an account
is maintained at a bank located in the United States, the Agent will make such
funds available by no later than 2:00 p.m. (New York City time) on the day so
received). No Lender's obligation to make any Loan shall be affected by any
other Lender's failure to make any Loan.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Agent on or before 10:00 a.m., New York
City time, on a Business Day, the Borrower may from time to time irrevocably
elect, on not less than three nor more than ten Business Days' notice that all,
or any portion in an aggregate minimum amount of $1,000,000 and an integral
multiple of $1,000,000, of any Loans be, in the case of Base Rate Loans,
converted into LIBO Rate Loans or, in the case of LIBO Rate Loans, be converted
into a Base Rate Loan or continued as a LIBO Rate Loan (in the absence of
delivery of a Continuation/Conversion Notice with respect to any LIBO Rate Loan
at least three Business Days before the last day of the then current Interest
Period with respect thereto, such LIBO Rate Loan shall, on such last day,
automatically convert to a Base Rate Loan); provided, however, that (i) each
such conversion or continuation shall be pro rated among the applicable
outstanding Loans of all Lenders, and (ii) no portion of the outstanding
principal amount of any Loans may be continued as, or be converted into, LIBO
Rate Loans when any Event of Default has occurred and is continuing.
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SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender (including for purposes of Sections 4.3 through
4.6, inclusive), and the obligation of the Borrower to repay such LIBO Rate Loan
shall nevertheless be to such Lender for the account of such foreign branch,
affiliate or international banking facility. In addition, each of the Guarantor
and the Borrower hereby consent and agree that, for purposes of any
determination to be made for purposes of Sections 4.1, 4.2, 4.3 or 4.4, it shall
be conclusively assumed that each Lender elected to fund all LIBO Rate Loans by
purchasing Dollar deposits in its LIBOR Office's interbank eurodollar market.
SECTION 2.6. Notes. Each Lender's Loans under its Commitment shall be
evidenced by a Note payable to the order of such Lender in a maximum principal
amount equal to such Lender's Percentage of the original Commitment Amount. The
Borrower hereby irrevocably authorizes each Lender to make (or cause to be made)
appropriate notations on the grid attached to such Lender's Note (or on any
continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of, the outstanding principal of, and the interest rate and
Interest Period applicable to the Loans evidenced thereby. Such notations shall
be conclusive and binding on the Borrower absent manifest error; provided,
however, that the failure of any Lender to make any such notations shall not
limit or otherwise affect any Obligations of either of the Obligors.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in full
the unpaid principal amount of each Loan upon the Stated Maturity Date. Prior
thereto, the Borrower
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Loans; provided, however, that
(i) any such prepayment shall be made pro rata among Loans of the
same type (such type to be specified by the Borrower) and, if
applicable, having the same Interest Period (such Interest Period or
Interest
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Periods to be specified by the Borrower) of all Lenders;
(ii) all such voluntary prepayments shall require at least three
(or, in the case of Base Rate Loans, two) but no more than ten
Business Days' prior written notice to the Agent; and
(iii) all such voluntary partial prepayments shall be in an
aggregate minimum amount of $1,000,000 and an integral multiple of
$1,000,000;
(b) shall, on each date when any reduction in the Commitment Amount
shall become effective, including pursuant to Section 2.2, make a mandatory
prepayment of all Loans equal to the excess, if any, of the aggregate,
outstanding principal amount of all Loans over the Commitment Amount as so
reduced; and
(c) shall, immediately upon any acceleration of the Stated Maturity
Date of any Loans pursuant to Section 8.2 or Section 8.3, repay all Loans,
unless, pursuant to Section 8.3, only a portion of all Loans is so
accelerated, in which case the portion of the Loans so accelerated shall be
repaid.
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4. No voluntary
prepayment of principal of any Loans shall cause a reduction in the Commitment
Amount.
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this Section 3.2.
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate Loan,
equal to the Alternate Base Rate from time to time in effect; and
(b) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus a margin of 1/4 of 1%.
The "LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a
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LIBO Rate Loan for any Interest Period, a rate per annum (rounded upwards, if
necessary, to the nearest 1/16 of 1%) determined pursuant to the following
formula:
LIBO Rate LIBO Rate
(Reserve Adjusted) = -------------------------------
1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Agent on the basis of the LIBOR Reserve
Percentage in effect on, and the applicable rates furnished to and received by
the Agent from Scotiabank, two Business Days before the first day of such
Interest Period.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans, the
rate of interest equal to the average (rounded upwards, if necessary, to the
nearest 1/16 of 1%) of the rates per annum for Dollar deposits (for delivery on
the first day of such Interest Period) which appear on the display designated
"LIBO" on the Reuter Monitor Money Rates Service (or such other page as may
replace the LIBO page on such system for the purpose of displaying London
interbank offered rates for Dollar deposits) as at or about 11:00 a.m. London
time two Business Days prior to the beginning of such Interest Period.
"LIBOR Reserve Percentage" means, relative to any Interest Period for LIBO
Rate Loans, the reserve percentage (expressed as a decimal) equal to the average
maximum aggregate reserve requirements of the Lenders (including all basic,
emergency, supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D of the F.R.S.
Board, having a term approximately equal or comparable to such Interest Period.
All LIBO Rate Loans shall bear interest from and including the first day of
the applicable Interest Period to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such LIBO Rate
Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount of
any Loan is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise), or after any other monetary Obligation of the
Borrower shall have become due and payable, the Borrower shall pay, but only to
the extent permitted by law, interest (after as well as before judgment) on such
amounts at a rate per annum equal to the Alternate Base Rate plus a margin of
2%.
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SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in part, of
principal outstanding on such Loan, but only on the amount so prepaid;
(c) with respect to Base Rate Loans, on each Quarterly Payment Date;
(d) with respect to LIBO Rate Loans, the last day of each applicable
Interest Period (and, if such Interest Period shall exceed three months, on
the three-month anniversary of the first day of such Interest Period);
(e) with respect to any Base Rate Loans converted into LIBO Rate Loans
on a day when interest would not otherwise have been payable pursuant to
clause (c), on the date of such conversion; and
(f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such
acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the Agent for
the account of each Lender, for the period (including any portion thereof when
its Commitment is suspended by reason of the Borrower's inability to satisfy any
condition of Article V) commencing on August 4, 1995 and continuing to but
excluding the final Commitment Termination Date, a commitment fee at the rate of
0.07% per annum on such Lender's Percentage of the sum of the average daily
unused portion of the Commitment Amount. Such commitment fees shall be payable
by the Borrower in arrears (i) on the Effective Date, in respect of fees that
have accrued from August 4, 1995 through (and including) the Effective Date and
(ii) thereafter, on each Quarterly Payment Date, commencing with the first such
day following the Effective Date, and on the Commitment Termination Date.
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SECTION 3.3.2. Other Fees. The Borrower agrees to pay to Scotiabank for its
own account the fees set forth in the Fee Letter.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall reasonably
determine (which determination shall, upon notice thereof to the Borrower and
the Lenders, be conclusive and binding on the Borrower) that the introduction of
or any change in or in the interpretation of any law makes it unlawful, or any
central bank or other governmental authority asserts that it is unlawful, for
such Lender to make, continue or maintain any Loan as, or to convert any Loan
into, a LIBO Rate Loan, the obligations of such Lender to make, continue,
maintain or convert any such Loans shall, upon such determination, forthwith be
suspended until such Lender shall notify the Agent that the circumstances
causing such suspension no longer exist, and all LIBO Rate Loans of such Lender
shall automatically convert into Base Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such law or
assertion.
SECTION 4.2. Deposits Unavailable. If the Agent shall have determined that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Required Lenders in the London
interbank market; or
(b) by reason of circumstances affecting the London interbank market,
adequate means do not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans,
then, upon notice from the Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.3 and Section 2.4 to make or continue
any Loans as, or to convert any Loans into, LIBO Rate Loans shall forthwith be
suspended until the Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Loans as, or of converting (or of its obligation to convert)
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any Loans into, LIBO Rate Loans, resulting from any change after the date hereof
in United States federal, state or foreign laws or regulations or the adoption
or making after the date hereof of any interpretations, directives or
requirements applying to a class of commercial banks that includes such Lender
under any United States federal, state or foreign laws or regulations (whether
or not having the force of law) by any court or governmental or monetary
authority charged with the interpretation or administration thereof. Such Lender
shall promptly notify the Agent and the Borrower in writing of the occurrence of
any such event, such notice to state, in reasonable detail, the reasons therefor
and the additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Lender within five Business Days of its receipt of
such notice, and such notice (which shall include calculations in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any loss
or expense (including any loss or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such Lender to make,
continue or maintain any portion of the principal amount of any Loan as, or to
convert any portion of the principal amount of any Loan into, a LIBO Rate Loan)
as a result of
(a) any conversion or repayment or prepayment of the principal amount
of any LIBO Rate Loans on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to Section 3.1 or
otherwise;
(b) any Loans not being made as LIBO Rate Loans in accordance with the
Borrowing Request therefor as a result of any action taken or not taken by
either Obligor; or
(c) any Loans not being continued as, or converted into, LIBO Rate
Loans in accordance with the Continuation/ Conversion Notice therefor as a
result of any action taken or not taken by either Obligor,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Agent), the Borrower shall, within ten days of its receipt thereof, pay directly
to such Lender such amount as will (in the reasonable determination of such
Lender) reimburse such Lender for such loss or expense. Such written notice
(which shall include calculations in reasonable detail) shall, in the absence of
manifest error, be conclusive and binding on the Borrower.
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SECTION 4.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, in each case after the date hereof, any law or regulation,
directive, guideline, decision or request (whether or not having the force of
law) of any court, central bank, regulator or other governmental authority
affects or would affect the amount of capital required or expected to be
maintained by any Lender or any Person controlling such Lender, and such Lender
determines (in its sole and absolute discretion) that the rate of return on its
or such controlling Person's capital as a consequence of its Commitment or the
Loans made by such Lender is reduced to a level below that which such Lender or
such controlling Person could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to time by such
Lender to the Borrower, the Borrower shall, within five days of its receipt of
such notice, pay directly to such Lender additional amounts sufficient to
compensate such Lender or such controlling Person for such reduction in rate of
return. A statement of such Lender as to any such additional amount or amounts
(including calculations thereof in reasonable detail) shall, in the absence of
manifest error, be conclusive and binding on the Borrower. In determining such
amount, such Lender may use any method of averaging and attribution that it
reasonably shall deem applicable.
SECTION 4.6. Taxes.
(a) All payments by either of the Obligors of principal of, and
interest on, the Loans and all other amounts payable hereunder shall be
made free and clear of and without deduction for any present or future
income, excise, stamp or franchise taxes and other taxes, fees, duties,
withholdings or other charges of any nature whatsoever imposed by any
taxing authority, but excluding United States withholding taxes, franchise
taxes and taxes imposed on or measured by any Lender's or the Agent's
income or receipts (such non-excluded items being called "Taxes"). In the
event that any withholding or deduction from any payment to be made by
either of the Obligors hereunder is required in respect of any Taxes
pursuant to any applicable law, rule or regulation, then such Obligor will
(i) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(ii) promptly forward to the Agent an official receipt or other
documentation reasonably satisfactory to the Agent evidencing such
payment to such authority; and
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(iii) pay to the Agent for the account of the Lenders such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount
such Lender would have received had no such withholding or deduction
been required.
Moreover, if any Taxes are directly asserted against the Agent or any
Lender with respect to any payment received by the Agent or such Lender
hereunder, the Agent or such Lender may pay such Taxes and such Obligor
will promptly pay such additional amounts (including any penalties,
interest or expenses) as is necessary in order that the net amount received
by such person after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount such person would have received
had not such Taxes been asserted.
(b) If either of the Obligors fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Agent, for the
account of the respective Lenders, the required receipts or other required
documentary evidence, such Obligor shall indemnify the Lenders for any
incremental Taxes, interest or penalties that may become payable by any
Lender as a result of any such failure. For purposes of this Section 4.6, a
distribution hereunder by the Agent or any Lender to or for the account of
any Lender shall be deemed a payment by the Obligor that made the relevant
payment to the Agent.
(c) On or prior to the making of the first Loan hereunder, and
thereafter upon the request of the Borrower or the Agent, each Lender that
is organized under the laws of a jurisdiction other than the United States
shall execute and deliver to the Borrower and the Agent, on or about the
first scheduled payment date in each Fiscal Year, one or more (as the
Borrower or the Agent may reasonably request) United States Internal
Revenue Service Forms 4224 or Forms 1001 or such other forms or documents
(or successor forms or documents), appropriately completed, as may be
applicable to establish the extent, if any, to which a payment to such
Lender is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes or
any other Loan Document shall be made by the Borrower to the Agent for the pro
rata account of the Lenders entitled to receive such payment. All such payments
required to be made to the Agent shall be transmitted by the Borrower to the
Agent, without setoff, deduction or counterclaim, not later than 11:00 a.m., New
York City time, on the date due, in immediately
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available funds, to such account as the Agent shall specify from time to time by
notice to the Borrower. Funds received after that time shall be deemed to have
been received by the Agent on the next succeeding Business Day. The Agent shall
promptly remit in same day funds to each Lender its share, if any, of such
payments received by the Agent for the account of such Lender. All interest and
fees shall be computed on the basis of the actual number of days (including the
first day but excluding the last day) occurring during the period for which such
interest or fee is payable over a year comprised of 360 days (or, in the case of
interest on a Base Rate Loan, 365 days or, if appropriate, 366 days). Whenever
any payment to be made shall otherwise be due on a day which is not a Business
Day, such payment shall (except as otherwise required by clause (c) of the
definition of the term "Interest Period") be made on the next succeeding
Business Day and such extension of time shall be included in computing interest
and fees, if any, in connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan (other than pursuant to the terms of Sections
4.3, 4.4 and 4.5) in excess of its pro rata share of payments then or therewith
obtained by all Lenders, such Lender shall purchase from the other Lenders such
participations in Loans made by them as shall be necessary to cause such
purchasing Lender to share the excess payment or other recovery ratably with
each of them; provided, however, that if all or any portion of the excess
payment or other recovery is thereafter recovered from such purchasing Lender,
the purchase shall be rescinded and each Lender which has sold a participation
to the purchasing Lender shall repay to the purchasing Lender the purchase price
to the ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of
(a) the amount of such selling Lender's required repayment to the
purchasing Lender, to
(b) the total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing Lender in
respect of the total amount so recovered. Each of the Obligors agrees that any
Lender so purchasing a participation from another Lender pursuant to this
Section may, to the fullest extent permitted by law, exercise all its rights of
payment (including pursuant to Section 4.9) with respect to such participation
as fully as if such Lender were the direct creditor of such Obligor in the
amount of such participation. If under any applicable bankruptcy, insolvency or
other similar law, any
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Lender receives a secured claim in lieu of a setoff to which this Section
applies, such Lender shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Lenders entitled under this Section to share in the benefits of any recovery on
such secured claim.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence of any Event of
Default described in clause (a) of Section 8.1.9, have the right to set off
against and apply to the payment of the Obligations then due and payable to it
any and all balances, credits, deposits, accounts or moneys of such Obligor then
or thereafter maintained with such Lender; provided, however, that any such
appropriation and application shall be subject to the provisions of Section 4.8
and any applicable laws. Each Lender agrees promptly to notify the Obligors and
the Agent after any such setoff and application made by such Lender; provided,
however, that the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under this Section are in
addition to other rights and remedies (including other rights of setoff under
applicable law or otherwise) which such Lender may have.
SECTION 4.10. Replacement of Lenders. Each Lender hereby severally agrees
that if such Lender (a "Subject Lender") either (i) gives a notice pursuant to
Section 4.1 or (ii) makes a demand upon the Borrower for (or if the Borrower is
otherwise required to pay) amounts pursuant to Section 4.3, 4.5 or 4.6, the
Borrower may, within 90 days of receipt by the Borrower of such notice or demand
(or the occurrence of such other event causing the Borrower to be required to
pay such compensation) give notice (a "Replacement Notice") in writing to the
Agent and such Lender of its intention to replace such Lender with a commercial
lending institution designated in such Replacement Notice. If the Agent shall,
in the exercise of its reasonable discretion and within 30 days of its receipt
of such Replacement Notice, notify the Borrower and such Subject Lender in
writing that the designated commercial lending institution is satisfactory to
the Agent, then such Lender shall, so long as no Default shall have occurred and
be continuing, assign, in accordance with Section 10.11.1, all of its
Commitments, Loans, Notes and other rights and obligations under this Agreement
and all other Loan Documents to such designated commercial lending institution;
provided, however, that (i) such assignment shall be without recourse,
representation or warranty and shall be on terms and conditions reasonably
satisfactory to such Lender and such designated commercial lending institution
and (ii) the purchase price paid by such designated commercial lending
institution shall be in the amount of such Lender's Loans, together with all
accrued and unpaid interest and fees in respect thereof, plus all other amounts
(including the amounts demanded and unreimbursed under
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Section 4.3, 4.5 or 4.6, as the case may be), owing to the Subject Lender
hereunder. Upon the effective date of such Assignment, the Borrower shall issue
a replacement Note or Notes, as the case may be, to such designated commercial
lending institution and such institution shall become a "Lender" for all
purposes under this Agreement and the other Loan Documents.
ARTICLE V
CONDITIONS TO BORROWING
SECTION 5.1. Initial Borrowing. The obligations of the Lenders to fund the
initial Borrowing shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Agent shall have received from each
Obligor a certificate, dated the date of the initial Borrowing, of its Secretary
or Assistant Secretary as to
(a) resolutions of its Board of Directors then in full force and
effect authorizing the execution, delivery and performance of this
Agreement and each other Loan Document to be executed by it; and
(b) the incumbency and signatures of those of its officers authorized
to act with respect to this Agreement and each other Loan Document executed
by it,
upon which certificate each Lender may conclusively rely until it shall have
received a further certificate of the Secretary of such Obligor canceling or
amending such prior certificate.
SECTION 5.1.2. Delivery of Notes. The Agent shall have received, for the
account of each Lender, its Note duly executed and delivered by the Borrower.
SECTION 5.1.3. Opinions of Counsel. The Agent shall have received opinions,
dated the date of the initial Borrowing and addressed to the Agent and all
Lenders, from
(a) Chadbourne & Parke LLP, New York counsel to the Obligors,
substantially in the form of Exhibit E hereto; and
(b) Tory Tory DesLauriers & Binnington, Ontario counsel to the
Obligors, substantially in the form of Exhibit F hereto.
SECTION 5.1.4. Closing Fees, Expenses, etc. The Agent shall have received
for its own account, or for the account of
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each Lender, as the case may be, all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 10.3, if then invoiced.
SECTION 5.1.5. Satisfactory Legal Form. All documents executed or submitted
pursuant hereto by or on behalf of either Obligor shall be reasonably
satisfactory in form and substance to the Agent and its counsel; the Agent and
its counsel shall have received all information, approvals, opinions, documents
or instruments as the Agent or its counsel may reasonably request.
SECTION 5.2. All Borrowings. The obligation of each Lender to fund any Loan
on the occasion of any Borrowing (including the initial Borrowing) shall be
subject to the satisfaction of each of the conditions precedent set forth in
this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both before and
after giving effect to any Borrowing (but, if any Default of the nature referred
to in Section 8.1.5 shall have occurred with respect to any Relevant
Indebtedness referred to in Section 8.1.5, without giving effect to the
application, directly or indirectly, of the proceeds thereof) the following
statements shall be true and correct
(a) the representations and warranties set forth in Article VI shall
be true and correct in all material respects with the same effect as if
then made (unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct in all
material respects as of such earlier date); and
(b) no Default shall have then occurred and be continuing.
SECTION 5.2.2. Borrowing Request. The Agent shall have received a Borrowing
Request for such Borrowing. Each of the delivery of a Borrowing Request and the
acceptance by the Borrower of the proceeds of such Borrowing shall constitute a
representation and warranty by the Obligors that on the date of such Borrowing
(both immediately before and after giving effect to such Borrowing and the
application of the proceeds thereof) the statements made in Section 5.2.1 are
true and correct.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agent to enter into this Agreement
and to make Loans hereunder, each of the Guarantor and the Borrower represents
and warrants to the Agent and each Lender as set forth in this Article VI.
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SECTION 6.1. Organization, etc. Each of the Guarantor and the Borrower and
each of the Significant Subsidiaries
(a) is a corporation validly organized and existing and (except in the
case of the Guarantor and the Borrower, solely as of the date of this
Agreement) in good standing under the laws of the jurisdiction of its
incorporation, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction where the nature of its business
requires such qualification, except where any such failure to be so
qualified would not reasonably be expected to have a Material Adverse
Effect (and, provided, that any dissolution, liquidation, amalgamation,
consolidation or merger of any Significant Subsidiary shall not, in and of
itself, be a misrepresentation under this Section 6.1(a)), and
(b) has full power and authority and holds all requisite governmental
licenses, permits and other approvals to (i) enter into and perform its
Obligations under this Agreement, the Notes and each other Loan Document to
which it is a party and (ii) except where the failure to hold such
licenses, permits and other approvals, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect, to own
and hold under lease its property and to conduct its business substantially
as currently conducted by it.
On the date hereof, for the purposes of the Business Corporations Act (Ontario),
the Borrower is a Subsidiary of the Guarantor.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by each of the Guarantor and the Borrower of this
Agreement, the Notes and each other Loan Document executed or to be executed by
it, are within the Guarantor's and the Borrower's corporate powers, as
applicable, have been duly authorized by all necessary corporate action, and do
not
(a) contravene the Guarantor's or the Borrower's Organic Documents;
(b) contravene any contractual restriction, law or governmental
regulation or court decree or order binding on or affecting the Guarantor
or the Borrower that is, in each such case, material or the contravention
of which could materially adversely affect the Lenders; or
(c) result in, or require the creation or imposition of, any Lien
(other than Permitted Liens) on any of the Guarantor's or the Borrower's
properties.
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SECTION 6.3. Government Approval, Regulation, etc. Except to the extent
required in connection with the acquisition of the capital stock of WCSI
referred to in the recitals, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
or other Person is required for the due execution, delivery or performance by
the Guarantor or the Borrower of this Agreement, the Notes or any other Loan
Document, except for authorizations, approvals, actions, notices and filings
which have been duly obtained, taken, given or made and are in full force and
effect. Neither the Guarantor, the Borrower nor any of their respective
Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
SECTION 6.4. Validity, etc. This Agreement constitutes, and the Notes and
each other Loan Document executed by the Guarantor and the Borrower will, on the
due execution and delivery thereof, constitute, the legal, valid and binding
obligations of the Guarantor and the Borrower, as the case may be, enforceable
against each of the Guarantor and the Borrower, as the case may be, in
accordance with their respective terms, except as enforceability may be limited
by any applicable bankruptcy, moratorium, insolvency, fraudulent conveyance or
other laws affecting creditors' rights generally.
SECTION 6.5. Financial Information. The consolidated balance sheet of the
Guarantor and each of its Subsidiaries as at December 31, 1994, and the related
consolidated statements of earnings and cash flows of the Guarantor and each of
its Subsidiaries, copies of which have been furnished to the Agent, have been
prepared in accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the Guarantor and its Subsidiaries covered
thereby as at the dates thereof and the results of their operations for the
periods then ended, in accordance with GAAP.
SECTION 6.6. No Material Adverse Change. Since the date of the financial
statements described in Section 6.5 to and including the date of the initial
Borrowing, there has been no material adverse change in the prospects of the
Guarantor and its Subsidiaries, taken as a whole. Since the date of
the financial statements described in Section 6.5, there has been no material
adverse change in the financial condition, operations or properties of the
Guarantor and its Subsidiaries, taken as a whole.
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SECTION 6.7. Litigation, Labor Controversies, etc. There is no pending or,
to the knowledge of the Guarantor and the Borrower, threatened litigation,
action, proceeding, or labor controversy affecting the Guarantor, the Borrower
or any of their respective Subsidiaries, or any of their respective properties,
businesses, assets or revenues, which would reasonably be expected to have a
Material Adverse Effect, except as disclosed in Item 6.7 ("Litigation") of the
Disclosure Schedule.
SECTION 6.8. Ownership of Properties. The Guarantor and each of its
Subsidiaries has valid title to or rights to use all of its material properties
and assets, real and personal, tangible and intangible, of any nature whatsoever
(including patents, trademarks, trade names, service marks and copyrights), free
and clear of all Liens or claims (including infringement claims with respect to
patents, trademarks, copyrights and the like) except Permitted Liens, except
where the failure to have such title or right would not reasonably be expected
to have a Material Adverse Effect.
SECTION 6.9. Taxes. The Guarantor and each of its Subsidiaries has filed
all material tax returns and reports required by law to have been filed by it
and has paid all taxes and governmental charges thereby shown to be owing,
except any such taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 6.10. Pension and Welfare Plans. During the
twelve-consecutive-month period prior to the date of (a) the execution and
delivery of this Agreement and (b) any Borrowing hereunder, no steps have been
taken to terminate any Pension Plan which has or would result in a material
liability to the Guarantor and its Subsidiaries, taken as a whole, and no
contribution failure has occurred with respect to any Pension Plan sufficient to
give rise to a Lien under section 302(f) of ERISA which has or would result in a
material liability to the Guarantor and its Subsidiaries, taken as a whole. No
condition exists or event or transaction has occurred with respect to any
Pension Plan which would reasonably be expected to result in the incurrence by
the Guarantor or any member of the Controlled Group of any liability which would
reasonably be expected to have a Material Adverse Effect. Except as disclosed in
Item 6.10 ("Employee Benefit Plans") of the Disclosure Schedule, neither of the
Obligors has any contingent liability with respect to any post-retirement
benefit under a Welfare Plan which has or would result in a material liability
to the Guarantor and its Subsidiaries, taken as a whole, other than liability
for continuation coverage described in Part 6 of Title I of ERISA.
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SECTION 6.11. Environmental Warranties. Except as set forth in Item 6.11
("Environmental Matters") of the Disclosure Schedule:
(a) all facilities and property (including underlying groundwater)
owned or leased by the Guarantor or any of its Subsidiaries have been, and
continue to be, owned or leased by the Guarantor and its Subsidiaries in
compliance with all Environmental Laws, except for instances of
non-compliance that would not reasonably be expected to have a Material
Adverse Effect;
(b) there are no pending or threatened
(i) claims, complaints, notices or requests for information
received by the Guarantor or any of its Subsidiaries with respect to
any alleged violation of any Environmental Law, which violation, if
proven, has the reasonable potential to result in a fine, penalty or
order that would reasonably be expected to have a Material Adverse
Effect, or
(ii) complaints or governmental notices or inquiries to the
Guarantor or any of its Subsidiaries regarding potential material
liability under any Environmental Law;
(c) there have been no Releases of Hazardous Materials at, on or under
any property now (or, to the Guarantor's knowledge, any property
previously) owned or leased by the Guarantor or any of its Subsidiaries
that, singly or in the aggregate, have, or would reasonably be expected to
have, a Material Adverse Effect;
(d) the Guarantor and its Subsidiaries have been issued and are in
material compliance with all permits, certificates, approvals, licenses and
other authorizations relating to environmental matters and necessary for
the conduct of their businesses, or, if such permit, certificate, approval,
license or other authorization has not been issued, its absence would not
reasonably be expected to have a Material Adverse Effect;
(e) no property now (or, to the Guarantor's knowledge, no property
previously) owned or leased by the Guarantor or any of its Subsidiaries is
listed or proposed for listing (with respect to owned property only) on the
National Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar state list of sites requiring investigation or clean-up;
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(f) to the knowledge of the Guarantor, there are no underground
storage tanks, active or abandoned, including petroleum storage tanks, on
or under any property now or previously owned or leased by the Guarantor or
any of its Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a Material Adverse Effect;
(g) neither the Guarantor nor any Subsidiary of the Guarantor has
directly transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or proposed for listing
on the National Priorities List pursuant to CERCLA, on the CERCLIS or on
any similar state list or which is the subject of federal, state or local
enforcement actions or other investigations which may lead to material
claims against the Guarantor or such Subsidiary thereof for any remedial
work, damage to natural resources or personal injury, including claims
under CERCLA; and
(h) to the knowledge of the Guarantor, there are no polychlorinated
biphenyls or friable asbestos present at any property now or previously
owned or leased by the Guarantor or any Subsidiary of the Guarantor that,
singly or in the aggregate, have, or may reasonably be expected to have, a
Material Adverse Effect.
SECTION 6.12. Regulations G, T, U and X. The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loans (including the proceeds of Loans used to
purchase any capital stock of WCSI) will be used for a purpose which violates
F.R.S. Board Regulation G, T, U or X. Terms for which meanings are provided in
F.R.S. Board Regulation G, T, U or X or any regulations substituted therefor, as
from time to time in effect, are used in this Section with such meanings.
SECTION 6.13. Accuracy of Information. All factual information heretofore
or contemporaneously furnished by or on behalf of the Guarantor or the Borrower
in writing to the Agent or any Lender for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all other such factual
information hereafter furnished by or on behalf of the Guarantor and the
Borrower in writing to the Agent or any Lender will be, true and accurate in
every material respect on the date as of which such information is dated or
certified, and such information is not, or shall not be, as the case may be,
incomplete by omitting to state any material fact necessary to make such
information not misleading in light of the circumstances in which made.
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ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. Each of the Guarantor and the Borrower
agrees with the Agent and each Lender that, until all Commitments have
terminated and all Obligations have been paid and performed in full, the
Guarantor and the Borrower will perform the obligations set forth in this
Section 7.1.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The Guarantor
will furnish, or will cause to be furnished, to the Agent (with sufficient
copies for each Lender) copies of the following financial statements, reports,
notices and information:
(a) as soon as available and in any event within 60 days after the end
of each of the first three Fiscal Quarters of each Fiscal Year of the
Guarantor, a consolidated balance sheet of the Guarantor and its
Subsidiaries as of the end of such Fiscal Quarter and consolidated
statements of earnings and cash flows of the Guarantor and its Subsidiaries
for such Fiscal Quarter and for the period commencing at the end of the
previous Fiscal Year and ending with the end of such Fiscal Quarter,
certified by the chief financial Authorized Officer of the Guarantor (the
Guarantor may, at its option, comply with this clause (a) by furnishing,
within the 60-day period referred to above, the appropriate report filed by
it on Form 10-Q under the Securities Exchange Act of 1934);
(b) as soon as available and in any event within 120 days after the
end of each Fiscal Year of the Guarantor, a copy of the annual audit report
for such Fiscal Year for the Guarantor and its Subsidiaries, including
therein a consolidated balance sheet of the Guarantor and its Subsidiaries
as of the end of such Fiscal Year and consolidated statements of earnings
and cash flows of the Guarantor and its Subsidiaries for such Fiscal Year,
in each case certified (without any Impermissible Qualification) by Price
Waterhouse or other recognized firm of chartered accountants, together with
a certificate from such accountants containing a computation of, and
showing compliance with, each of the financial ratios and restrictions
contained in Section 7.2.2 (the Guarantor may, at its option, comply with
this clause (b) by furnishing, within the 120-day period referred to above,
the appropriate report filed by it on Form 10-K under the Securities
Exchange Act of 1934);
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(c) as soon as available and in any event within 60 days after the end
of each Fiscal Quarter, a certificate, executed by the chief financial
Authorized Officer of the Guarantor, showing (in reasonable detail and with
appropriate calculations and computations) compliance with the financial
covenant set forth in Section 7.2.2;
(d) as soon as possible and in any event within five Business Days
after the occurrence of each Default, a statement of the chief financial
Authorized Officer of the Guarantor setting forth details of such Default
and the action which the Guarantor has taken and proposes to take with
respect thereto;
(e) within ten Business Days of becoming aware of the institution of
any steps by the Guarantor or any other Person to terminate any Pension
Plan, or the failure to make a required contribution to any Pension Plan if
such failure is sufficient to give rise to a Lien under section 302(f) of
ERISA, or the taking of any action with respect to a Pension Plan which
could result in the requirement that the Guarantor furnish a bond or other
security to the PBGC or such Pension Plan, or the occurrence of any event
with respect to any Pension Plan which could result in the incurrence by
the Guarantor of any material liability, or any material increase in the
contingent liability of the Guarantor with respect to any post-retirement
Welfare Plan benefit, notice thereof and copies of all documentation
relating thereto; and
(f) such other information respecting the condition or operations,
financial or otherwise, of the Guarantor or any of its Subsidiaries as any
Lender through the Agent (or, in the case of information regarding any such
Subsidiary that is not a Significant Subsidiary, as the Agent) may from
time to time reasonably request.
SECTION 7.1.2. Compliance with Laws, etc. The Guarantor will, and will
cause each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations and orders, except for any failures to
comply that would not reasonably be expected to have a Material Adverse Effect,
such compliance to include (without limitation), the payment, before the same
become delinquent, of all material taxes, assessments and governmental charges
imposed upon it or upon its property except to the extent being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its books.
SECTION 7.1.3. Books and Records. The Guarantor will, and will cause each
of its Subsidiaries to, keep books and records
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which accurately reflect its business affairs and transactions and, upon
reasonable notice to the Guarantor, (x) permit the Agent and each Lender or any
of their respective representatives, at reasonable times and intervals, to visit
all of its offices, to discuss its financial matters with its officers and to
examine any of its books or other corporate records, subject to normal security
and confidentiality rules of the Guarantor, and (y) permit the Agent and each
Lender and any of their respective representatives, once annually at the
Guarantor's expense and at any other reasonable interval at any Lender's
expense, to discuss financial matters with its independent public accountants,
with the Guarantor present (if it so chooses) during such discussions (and the
Guarantor hereby authorizes such independent public accountants to discuss the
Guarantor's financial matters with each Lender or its representatives).
SECTION 7.1.4. Environmental Covenant. The Guarantor will, and will cause
each of its Subsidiaries to,
(a) use and operate all of its facilities and properties in material
compliance with all Environmental Laws, keep all necessary material
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material
compliance therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws; and
(b) within five Business Days after the receipt of the same, notify
the Agent and provide copies upon receipt of all written claims,
complaints, notices of violation or orders relating to compliance with
Environmental Laws or the handling or release of Hazardous Materials,
unless such document alleges or relates to an alleged violation or
circumstance that would not reasonably be expected to have a Material
Adverse Effect.
SECTION 7.1.5. Use of Proceeds. The Borrower agrees that it will apply the
proceeds of each Borrowing only for the purposes set forth in the fifth recital.
SECTION 7.2. Negative Covenants. Each of the Guarantor and Borrower agrees
with the Agent and each Lender that, until all Commitments have terminated and
all Obligations have been paid and performed in full, the Guarantor and the
Borrower will perform the obligations set forth in this Section 7.2.
SECTION 7.2.1. Business Activities. The Guarantor will not, and will not
permit any of its Significant Subsidiaries to, engage in any business activity,
except those business activities (a) currently engaged in by the Guarantor and
its Subsidiaries
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and by WCSI and its Subsidiaries and (b) related to the information handling
business and (c) such other activities as may be incidental thereto.
SECTION 7.2.2. Indebtedness. The Guarantor will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Debt, if, either before or after
giving effect to the creation, incurrence or assumption of such Debt (and the
repayment of any Indebtedness refinanced thereby), the Leverage Ratio exceeds
(or would exceed) 0.55:1.
SECTION 7.2.3. Liens. The Guarantor will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any
of its property, revenues or assets, whether now owned or hereafter acquired,
except:
(a) Liens granted prior to the Effective Date to secure payment of
Indebtedness that is identified in the financial statements of the
Guarantor referred to in Section 6.5 as secured debt;
(b) Liens granted to secure payment of Indebtedness which is incurred
by the Guarantor or any of its Significant Subsidiaries to a vendor of any
assets to finance its acquisition of such assets and covering only those
assets acquired with the proceeds of such Indebtedness;
(c) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on its books and Liens arising under ERISA to the extent permitted by
Section 8.1.7;
(d) Liens of carriers, warehousemen, mechanics, materialmen and
landlords and similar Liens arising by operation of law incurred in the
ordinary course of business for sums not overdue for more than 30 days or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on its books;
(e) Liens incurred in the ordinary course of business, including bank
set-off rights and Liens incurred in connection with workmen's
compensation, unemployment insurance or other forms of governmental
insurance or benefits, or to secure performance of tenders, statutory
obligations, leases and contracts (other than for borrowed
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money) entered into in the ordinary course of business or to secure
obligations on surety or appeal bonds;
(f) judgment Liens in existence less than 30 days after the entry
thereof or with respect to which execution has been stayed or the payment
of which is covered in full (subject to a customary deductible) by
insurance maintained with responsible insurance companies;
(g) Liens granted by the Borrower in any margin stock, as defined in
F.R.S. Board Regulations G,T,U, or X (or any regulation substituted
therefor), owned by it whether or not such margin stock is purchased with
the proceeds of the Loans;
(h) easements, rights-of-way, zoning and use restrictions and other
similar encumbrances which, in the aggregate, do not materially interfere
with the occupation, use, and enjoyment by the Guarantor or any Subsidiary
of the property to assets encumbered thereby in the normal course of
business or materially impair the value of the property subject thereto;
(i) Liens securing obligations of any Subsidiary of the Guarantor
(other than the Borrower) to any other Subsidiary of the Guarantor;
(j) Liens arising under any of the Loan Documents;
(k) Liens on bank accounts maintained by the Guarantor, to the extent
that (i) such Liens secure Debt of Subsidiaries of the Guarantor held by
the bank at which such bank account is maintained (or any affiliate or
nominee of such bank) and (ii) such Debt is secured by such Liens;
(l) Liens existing on property at the time of its acquisition
(directly or indirectly), other than any such Lien created in contemplation
of such acquisition that is not otherwise permitted by clause (b) above;
(m) Any extension, renewal or replacement (or successive extensions,
renewals or replacements), in whole or in part, of any Lien referred to in
Sections 7.2.3(a) through (l) hereof, provided that (1) the Lien shall be
limited to all or a part of the property covered by the Lien extended,
renewed or replaced (plus improvements thereon) and (2) that any Debt
secured by such Lien is not increased; and
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(n) Liens not otherwise permitted by this Section 7.2.3 securing
Indebtedness in the aggregate not in excess of $100,000,000.
SECTION 7.2.4. Contingent Obligations. The Guarantor will not permit the
sum of the following (determined on a consolidated basis without duplication) to
exceed $15,000,000 at any time:
(a) the aggregate amount of Indebtedness of the Guarantor and its
Subsidiaries of the type referred to in clause (f) of the definition
thereof, plus
(b) the aggregate amount of Contingent Liabilities of the Guarantor
and its Subsidiaries in respect of Indebtedness of a Person (other than a
Subsidiary of the Guarantor) that is of a type described in clause (a),
(b), (c) or (f) of the definition of "Indebtedness" (other than any
Contingent Liability in respect of Indebtedness under this Agreement).
SECTION 7.2.5. Dissolution, etc. The Guarantor will not liquidate or
dissolve. The Borrower will not liquidate or dissolve, unless its obligations
under the Loan Documents have been assumed by another Person in accordance with
Section 10.10(a). The Guarantor will not consolidate or amalgamate with or merge
into, any other Person unless at the time thereof and after giving effect
thereto, no Event of Default shall be continuing and either (a) the Guarantor is
the surviving entity of such consolidation, amalgamation or merger or (b) the
surviving entity of such consolidation, amalgamation or merger assumes the
obligations of the Guarantor hereunder in writing.
SECTION 7.2.6. Transactions with Affiliates. Except as expressly
contemplated in this Agreement, the Guarantor will not, and will not permit any
of its Subsidiaries to, enter into, or cause, suffer or permit to exist any
arrangement or contract with any of its other Affiliates (other than (x)
salaries and fees to its directors, officers and employees as the Guarantor or
such Subsidiary may determine are appropriate in relationship to the services
performed and (y) arrangements or contracts solely among Subsidiaries of the
Guarantor or between the Guarantor and any Subsidiary), unless such arrangement
or contract is fair and equitable to the Guarantor or such Subsidiary and is an
arrangement or contract of the kind which would be entered into by a prudent
Person in the position of the Guarantor or such Subsidiary with a Person which
is not one of its Affiliates.
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ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following events or
occurrences described in this Section 8.1 shall constitute an "Event of
Default".
SECTION 8.1.1. Non-Payment of Obligations. The Guarantor or the Borrower
shall default in the payment or prepayment when due of any principal of any
Loan; or the Guarantor or the Borrower shall default (and such default shall
continue unremedied for a period of five Business Days) in the payment when due
of any interest on any Loan, any commitment fee or any other Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of the
Guarantor or the Borrower made or deemed to be made hereunder or in any other
Loan Document executed by it or any other certificate furnished by or on behalf
of the Guarantor or the Borrower to the Agent or any Lender for the purposes of
or in connection with this Agreement or any such other Loan Document (including
any certificates delivered pursuant to Article V) is or shall be incorrect in
any material respect when made or deemed to be made.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations. The
Obligors shall default in the due performance and observance of any of their
obligations under Section 7.2.2 or 7.2.4; or the Obligors shall default (and
such default shall continue unremedied for a period of 15 days after notice
thereof shall have been given to the Borrower by the Agent or any Lender) in the
due performance and observance of any of their other obligations under Section
7.2 or any of their obligations under Section 7.1.1 or Section 7.1.4 (for the
avoidance of doubt, no Default will be deemed to occur under this Agreement
solely as the result of any sale, pledge or disposition of, or any change in the
market value of, any margin stock (as that term is used in F.R.S. Board
Regulations G, T, U and X)).
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. The
Guarantor or the Borrower shall default in the due performance and observance of
any other agreement contained herein or in any other Loan Document executed by
it, and such default shall continue unremedied for a period of 30 days after
notice thereof shall have been given to the Borrower by the Agent or any Lender.
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SECTION 8.1.5. Default on Other Indebtedness. Either of the following shall
occur:
(i) a default in the payment when due (subject to any applicable grace
period), whether by acceleration or otherwise, of any Indebtedness of the
Guarantor or any of its Subsidiaries having a principal amount (or, in the
case of Hedging Obligations, the net amount payable by the Guarantor or
such Subsidiary in respect thereof), individually or in the aggregate, in
excess of $25,000,000 (other than (x) Indebtedness described in
Section 8.1.1, (y) Indebtedness of the type described in paragraph (d) of
the definition of "Indebtedness" (and any Contingent Liability in respect
of Indebtedness of the type described in such paragraph (d)) and (z) for
purposes of this clause(i) only, intercompany Indebtedness owing by the
Guarantor or a Subsidiary of the Guarantor to another Subsidiary of the
Guarantor or to the Guarantor, to the extent such default has been waived
within ten Business Days of the occurrence thereof by the holder of such
intercompany Indebtedness)(the "Relevant Indebtedness"), or
(ii) a default in the performance or observance of any obligation or
condition with respect to such Relevant Indebtedness if the effect of such
default is to accelerate the maturity of any such Relevant Indebtedness or
to permit the holder or holders of such Relevant Indebtedness, or any
trustee or agent for such holders, to cause such Relevant Indebtedness to
become due and payable prior to its expressed maturity;
provided that no Default shall be deemed to have occurred under this Section
with respect to any default under any agreement evidencing Indebtedness owed to
a Lender or any affiliate of a Lender if such default shall relate solely to a
restriction on margin stock (as that term is used in F.R.S. Board Regulations G,
T, U and X).
SECTION 8.1.6. Judgment. Any final, non-appealable judgment or order for
the payment of money in excess of $50,000,000 shall be rendered against the
Guarantor, the Borrower or any Subsidiary by a court or other governmental
authority of competent jurisdiction and there shall be a period of 30
consecutive days (or any longer period which under applicable law is allowed for
appeal or stay of execution of such judgment or order) during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect, unless such judgment or order shall have been
vacated, satisfied, dismissed or bonded upon appeal; provided, however, that any
such judgment or order shall not be an Event of Default hereunder if and for so
long as (i) such judgment or order is
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covered by a valid and binding policy of insurance and (ii) the insurer in
respect of such policy has been notified of, and has not disputed the claim for
payment of, the claim in respect of such judgment or order.
SECTION 8.1.7. Pension Plans. Any of the following events shall occur with
respect to any Pension Plan
(a) the institution of any steps by the Guarantor, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such termination, the Guarantor or any such member could be
required to make a contribution to such Pension Plan, or could reasonably
expect to incur a liability or obligation to such Pension Plan, which may
reasonably be expected to have a Material Adverse Effect; or
(b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA, which Lien
is not removed within 90 days after such Lien is imposed.
SECTION 8.1.8. Change in Control. Any Change in Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. Any Relevant Person shall
(a) become insolvent or generally fail to pay, or admit in writing its
inability or unwillingness to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for such Relevant Person
or its property under any bankruptcy or insolvency law, or make a general
assignment for the benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for any Relevant Person or for a
substantial part of the property of such Relevant Person under any
bankruptcy or insolvency law, and such trustee, receiver, sequestrator or
other custodian shall not be discharged within 90 days;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or liquidation
proceeding, in respect of any Relevant Person under any bankruptcy or
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insolvency law, and, if any such case or proceeding is not commenced by
such Relevant Person, such case or proceeding shall be consented to or
acquiesced in by such Relevant Person or shall result in the entry of an
order for relief or shall remain for 90 days undismissed; or
(e) take any action authorizing, or in furtherance of, any of the
foregoing.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 8.1.9 shall occur, the Commitments (if not
theretofore terminated) shall automatically terminate and the outstanding
principal amount of all outstanding Loans and all other Obligations shall
automatically be and become immediately due and payable, without notice or
demand.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of Section
8.1.9) shall occur for any reason, whether voluntary or involuntary, and be
continuing, the Agent, upon the direction of the Required Lenders, shall by
notice to the Guarantor and the Borrower declare all or any portion of the
outstanding principal amount of the Loans and other Obligations to be due and
payable and/or the Commitments (if not theretofore terminated) to be terminated,
whereupon the full unpaid amount of such Loans and other Obligations which shall
be so declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment, and/or, as the case may be, the
Commitments shall terminate.
ARTICLE IX
THE AGENT
SECTION 9.1. Actions. Each Lender hereby appoints Scotiabank as its Agent
under and for purposes of this Agreement, the Notes and each other Loan
Document. Each Lender authorizes the Agent to act on behalf of such Lender under
this Agreement, the Notes and each other Loan Document and, in the absence of
other written instructions from the Required Lenders received from time to time
by the Agent (with respect to which the Agent agrees that it will comply, except
as otherwise provided in this Section or as otherwise advised by counsel), to
exercise such powers hereunder and thereunder as are specifically delegated to
or required of the Agent by the terms hereof and thereof, together with such
powers as may be reasonably incidental thereto. Each Lender hereby indemnifies
(which indemnity shall survive any termination of this Agreement) the Agent, pro
rata
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according to such Lender's Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against, the Agent in any way relating to or arising out of this Agreement, the
Notes and any other Loan Document, including reasonable attorneys' fees, and as
to which the Agent is not reimbursed by the Guarantor or the Borrower; provided,
however, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, claims, costs or expenses which are
determined by a court of competent jurisdiction in a final proceeding to have
resulted solely from the Agent's gross negligence or wilful misconduct. The
Agent shall not be required to take any action hereunder, under the Notes or
under any other Loan Document, or to prosecute or defend any suit in respect of
this Agreement, the Notes or any other Loan Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the Agent shall be
or become, in the Agent's determination, inadequate, the Agent may call for
additional indemnification from the Lenders and cease to do the acts indemnified
against hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Agent shall have been
notified by telephone, confirmed in writing, by any Lender by 5:00 p.m., New
York City time, on the day prior to a Borrowing that such Lender will not make
available the amount which would constitute its Percentage of such Borrowing on
the date specified therefor, the Agent may assume that such Lender has made such
amount available to the Agent and, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If and to the extent that such
Lender shall not have made such amount available to the Agent, such Lender, the
Guarantor and the Borrower agree to repay the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
the Agent made such amount available to the Borrower to the date such amount is
repaid to the Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing.
SECTION 9.3. Exculpation. Neither the Agent nor any of its directors,
officers, employees or agents shall be liable to any Lender for any action taken
or omitted to be taken by it under this Agreement or any other Loan Document, or
in connection herewith or therewith, except for its own wilful misconduct or
gross negligence, nor responsible for any recitals or warranties herein or
therein, nor for the effectiveness, enforceability, validity or due execution of
this Agreement or any other Loan Document, nor to make any inquiry respecting
the performance by the Guarantor or the Borrower of its obligations hereunder or
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under any other Loan Document. Any such inquiry which may be made by the Agent
shall not obligate it to make any further inquiry or to take any action. The
Agent shall be entitled to rely upon advice of counsel concerning legal matters
and upon any notice, consent, certificate, statement or writing which the Agent
believes to be genuine and to have been presented by a proper Person.
SECTION 9.4. Successor. The Agent may resign as such at any time upon at
least 60 days' prior notice to the Borrower and all Lenders. If the Agent at any
time shall resign, the Required Lenders may appoint another Lender as a
successor Agent which shall thereupon become the Agent hereunder. If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the retiring Agent's giving
notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent, which shall be one of the Lenders or a commercial
banking institution (which, so long as no Default shall be continuing, shall be
reasonably acceptable to the Guarantor) organized under the laws of the U.S. (or
any State thereof) or a U.S. branch or agency of a commercial banking
institution (which, so long as no Default shall be continuing, shall be
reasonably acceptable to the Guarantor), and having a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall be entitled to
receive from the retiring Agent such documents of transfer and assignment as
such successor Agent may reasonably request, and shall thereupon succeed to and
become vested with all rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation
hereunder as the Agent, the provisions of
(a) this Article IX shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was the Agent under this Agreement;
and
(b) Section 10.3 and Section 10.4 shall continue to inure to its
benefit.
SECTION 9.5. Loans by Scotiabank. Scotiabank shall have the same rights and
powers with respect to (x) the Loans made by it or any of its affiliates, and
(y) the Notes held by it or any of its affiliates as any other Lender and may
exercise the same as if it were not the Agent. Scotiabank and its affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with the Guarantor and the Borrower or any Subsidiary or Affiliate of
the Guarantor and the Borrower as if Scotiabank were not the Agent hereunder.
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SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
independently of the Agent and each other Lender, and based on such Lender's
review of the financial information of the Guarantor and the Borrower, this
Agreement, the other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitment. Each Lender also acknowledges that it will,
independently of the Agent and each other Lender, and based on such other
documents, information and investigations as it shall deem appropriate at any
time, continue to make its own credit decisions as to exercising or not
exercising from time to time any rights and privileges available to it under
this Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Agent shall give prompt notice to each Lender
of each notice or request required or permitted to be given to the Agent by the
Guarantor or the Borrower pursuant to the terms of this Agreement (unless
concurrently delivered to the Lenders by the Guarantor or the Borrower). The
Agent will distribute to each Lender each document or instrument received for
its account and copies of all other communications received by the Agent from
the Guarantor or the Borrower for distribution to the Lenders by the Agent in
accordance with the terms of this Agreement.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented to
by the Guarantor, the Borrower and the Required Lenders; provided, however,
that:
(x) any amendment that is entered into solely to effect assignments
made in accordance with Section 10.11.1 shall require only the consent of
the Guarantor, the Borrower and the Agent; and
(y) no such amendment, modification or waiver which would:
(a) modify any requirement hereunder that any particular action
be taken by all the Lenders or by the Required Lenders shall be
effective unless consented to by each Lender;
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(b) modify this Section 10.1, change the definition of "Required
Lenders", increase the Commitment Amount or the Percentage of any
Lender, reduce any fees (including, without limitation, the commitment
fees) described in Article III, or extend the Commitment Termination
Date shall be made without the consent of each Lender;
(c) extend the due date for, or reduce the amount of, any
scheduled repayment or prepayment of principal of or interest on any
Loan (or reduce the principal amount of or rate of interest on any
Loan) shall be made without the consent of the holder of that Note
evidencing such Loan;
(d) modify the guaranty contained in Article XI; or
(e) affect adversely the interests, rights or obligations of the
Agent qua the Agent shall be made without consent of the Agent.
No failure or delay on the part of the Agent, any Lender or the holder of any
Note in exercising any power or right under this Agreement or any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
the Guarantor or the Borrower in any case shall entitle it to any notice or
demand in similar or other circumstances. No waiver or approval by the Agent or
any Lender under this Agreement or any other Loan Document shall, except as may
be otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 10.2. Notices. All notices and other communications provided to any
party hereto under this Agreement or any other Loan Document shall be in writing
or by facsimile and addressed, delivered or transmitted to such party at its
address or facsimile number set forth below its signature hereto or set forth in
the Lender Assignment Agreement or at such other address or facsimile number as
may be designated by such party in a notice to the other parties. Any notice, if
mailed and properly addressed with postage prepaid or if properly addressed and
sent by pre-paid courier service, shall be deemed given when received; any
notice, if transmitted by facsimile, shall be deemed given when the confirmation
of transmission thereof is received by the transmitter.
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SECTION 10.3. Payment of Costs and Expenses. The Guarantor and the Borrower
jointly and severally agree to pay on demand all reasonable expenses of the
Agent (including the reasonable fees and out-of-pocket expenses of one special
counsel to the Agent and of one local counsel, if any, who may be retained by
counsel to the Agent) in connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from time
to time hereafter be requested by the Guarantor or the Borrower, whether or
not the transactions contemplated hereby are consummated; and
(b) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Guarantor and the Borrower further jointly and severally agree to pay, and
to save the Agent and the Lenders harmless from all liability for, any stamp or
other taxes which may be payable in connection with the execution or delivery of
this Agreement, the Borrowings hereunder, or the issuance of the Notes or any
other Loan Documents. The Guarantor and the Borrower also jointly and severally
agree to reimburse the Agent and each Lender upon demand for all reasonable
out-of-pocket expenses (including reasonable attorneys' fees and out-of-pocket
expenses) incurred by the Agent or such Lender in connection with (x) the
negotiation of any restructuring or "work-out", whether or not consummated, of
any Obligations and (y) the enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Commitments,
the Guarantor and the Borrower hereby jointly and severally indemnify, exonerate
and hold the Agent and each Lender and each of their respective officers,
directors, employees and agents (collectively, the "Indemnified Parties") free
and harmless from and against any and all actions, causes of action, suits,
losses, costs, liabilities and damages, and expenses incurred in connection
therewith (other than any of the foregoing related to or arising from taxes),
irrespective of whether any such Indemnified Party is a party to the action for
which indemnification hereunder is sought, including reasonable attorneys' fees
and disbursements (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
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(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Loan, including the
purchase of any margin stock or other equity interests in another Person;
(b) the entering into and performance of this Agreement and any other
Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of the Guarantor or the Borrower as the result of
any determination by the Required Lenders pursuant to Article V not to fund
any Borrowing, but excluding any controversies that are solely among
Lenders or among Lenders and the Agent);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower, the Guarantor or any
of its Subsidiaries of all or any portion of the stock or assets of any
Person, whether or not the Agent or such Lender is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Guarantor or any of its
Subsidiaries of any Hazardous Material; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Guarantor or any Subsidiary thereof of
any Hazardous Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising under any
Environmental Law), regardless of whether caused by, or within the control
of, the Guarantor or such Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or wilful misconduct. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, the Guarantor and the Borrower
hereby jointly and severally agree to make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
SECTION 10.5. Survival. The obligations of the Guarantor and the Borrower
under Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the
Lenders under Section 9.1, shall in each case survive any termination of this
Agreement, the payment in full of all Obligations and the termination of all
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Commitments. The representations and warranties made by the Guarantor and the
Borrower in this Agreement and in each other Loan Document shall survive the
execution and delivery of this Agreement and each such other Loan Document.
SECTION 10.6. Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
SECTION 10.7. Headings. The various headings of this Agreement and of each
other Loan Document are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or such other Loan Document or any
provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This Agreement
may be executed by the parties hereto in several counterparts, each of which
shall be executed by the Guarantor, the Borrower and the Agent and be deemed to
be an original and all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when counterparts hereof
executed on behalf of the Guarantor, the Borrower and each Lender (or notice
thereof satisfactory to the Agent) shall have been received by the Agent and
notice thereof shall have been given by the Agent to the Guarantor and each
Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE NOTES
AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. This Agreement, the
Notes and the other Loan Documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements, written or oral, with respect thereto.
SECTION 10.10. Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
(a) neither the Guarantor nor the Borrower may assign or transfer its
rights or obligations hereunder without the prior written consent of the
Agent and all Lenders, except that the Borrower may assign its rights and
delegate its obligations hereunder to any wholly-owned direct or indirect
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Subsidiary of the Guarantor (that is organized under the laws of any state
of the United States) that assumes such obligations in writing or by
operation of law (including by merger or consolidation); and
(b) the rights of sale, assignment and transfer of the Lenders are
subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans and Note; Participations in Loans
and Note. Each Lender may assign, or sell participations in, its Loans and
Commitment to one or more other Persons in accordance with this Section 10.11.
SECTION 10.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower and the Agent (which
consents shall not be unreasonably delayed or withheld) may at any time
assign and delegate to one or more commercial banks; and
(b) with notice to the Borrower and the Agent, but without the consent
of the Borrower or the Agent, may assign and delegate to any of its
affiliates or to any other Lender;
(each Person described in either of the foregoing clauses as being the Person to
whom such assignment and delegation is to be made, being hereinafter referred to
as an "Assignee Lender"), all or any fraction of such Lender's total Loans and
Commitment (which assignment and delegation shall be of a constant, and not a
varying, percentage of all the assigning Lender's Loans and Commitment);
provided, however, that any such Assignee Lender will comply, if applicable,
with the provisions contained in Section 4.6 and further, provided, however,
that, the Borrower and the Agent shall be entitled to continue to deal solely
and directly with such Lender in connection with the interests so assigned and
delegated to an Assignee Lender until
(c) written notice of such assignment and delegation, together with
payment instructions, addresses and related information with respect to
such Assignee Lender, shall have been given to the Borrower and the Agent
by such Lender and such Assignee Lender;
(d) such Assignee Lender shall have executed and delivered to the
Borrower and the Agent a Lender Assignment Agreement, accepted by the
Agent; and
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(e) the processing fees described below shall have been paid.
From and after the date that the Agent accepts such Lender Assignment Agreement,
(x) the Assignee Lender thereunder shall be deemed automatically to have become
a party hereto and to the extent that rights and obligations hereunder have been
assigned and delegated to such Assignee Lender in connection with such Lender
Assignment Agreement, shall have the rights and obligations of a Lender
hereunder and under the other Loan Documents, and (y) the assignor Lender, to
the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall be
released from its obligations hereunder and under the other Loan Documents.
Within five Business Days after its receipt of notice that the Agent has
received an executed Lender Assignment Agreement, the Borrower shall execute and
deliver to the Agent (for delivery to the relevant Assignee Lender) a new Note
evidencing such Assignee Lender's assigned Loans and Commitment and, if the
assignor Lender has retained Loans and a Commitment hereunder, a replacement
Note in the principal amount of the Loans and Commitment retained by the
assignor Lender hereunder (such Note to be in exchange for, but not in payment
of, that Note then held by such assignor Lender). Each such Note shall be dated
the date of the predecessor Note. The assignor Lender shall mark the predecessor
Note "exchanged" and deliver it to the Borrower. Accrued interest on that part
of the predecessor Note evidenced by the new Note, and accrued fees, shall be
paid as provided in the Lender Assignment Agreement. Accrued interest on that
part of the predecessor Note evidenced by the replacement Note shall be paid to
the assignor Lender. Accrued interest and accrued fees shall be paid at the same
time or times provided in the predecessor Note and in this Agreement. Such
assignor Lender or such Assignee Lender must also pay a processing fee to the
Agent upon delivery of any Lender Assignment Agreement in the amount of $3,000.
Any attempted assignment and delegation not made in accordance with this Section
10.11.1 shall be null and void.
SECTION 10.11.2. Participations. Any Lender may at any time sell to one or
more commercial banks (each of such commercial banks being herein called a
"Participant") participating interests in any of the Loans, its Commitment, or
other interests of such Lender hereunder; provided, however, that
(a) no participation contemplated in this Section 10.11 shall relieve
such Lender from its Commitment or its other obligations hereunder or under
any other Loan Document;
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(b) such Lender shall remain solely responsible for the performance of
its Commitment and such other obligations;
(c) the Borrower and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and each of the other Loan Documents;
(d) no Participant, unless such Participant is an affiliate of such
Lender, or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any Participant that such
Lender will not, without such Participant's consent, take any actions of
the type described in clause (b) or (c) of Section 10.1; and
(e) the Guarantor and the Borrower shall not be required to pay any
amount under this Agreement (including Section 4.6) that is greater than
the amount which it would have been required to pay had no participating
interest been sold.
The Borrower and the Guarantor each acknowledges and agrees that, subject to
clause (e) above, each Participant, for purposes of Sections 4.3, 4.4, 4.5, 4.6,
4.8, 4.9, 10.3 and 10.4, shall be considered a Lender.
SECTION 10.12. Other Transactions. Nothing contained herein shall preclude
the Agent or any other Lender from engaging in any transaction, in addition to
those contemplated by this Agreement or any other Loan Document, with the
Guarantor, the Borrower or any of its Affiliates in which the Guarantor, the
Borrower or such Affiliate is not restricted hereby from engaging with any other
Person.
SECTION 10.13. Forum Selection and Consent to Jurisdiction. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE LENDERS, THE GUARANTOR
OR THE BORROWER SHALL, TO THE FULLEST EXTENT PERMITTED BY LAW, BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. EACH OF THE
GUARANTOR AND THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL
JUDGMENT RENDERED
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THEREBY IN CONNECTION WITH SUCH LITIGATION. EACH OF THE GUARANTOR AND THE
BORROWER HEREBY IRREVOCABLY APPOINTS CSC NETWORKS (THE "PROCESS AGENT"), WITH AN
OFFICE ON THE DATE HEREOF AT 375 HUDSON STREET, NEW YORK, NEW YORK 10014, UNITED
STATES, AS ITS AGENT TO RECEIVE, ON THE GUARANTOR'S AND ON THE BORROWER'S BEHALF
AND ON BEHALF OF ITS PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT
AND ANY OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH
SERVICE MAY BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO THE
GUARANTOR OR THE BORROWER IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT'S
ABOVE ADDRESS, AND EACH OF THE GUARANTOR AND THE BORROWER HEREBY IRREVOCABLY
AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH SERVICE ON ITS BEHALF.
AS AN ALTERNATIVE METHOD OF SERVICE, EACH OF THE GUARANTOR AND THE BORROWER
FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK.
EACH OF THE GUARANTOR AND THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY
SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE GUARANTOR OR THE
BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE GUARANTOR AND THE BORROWER HEREBY IRREVOCABLY WAIVE
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS.
SECTION 10.14. Waiver of Jury Trial. THE AGENT, THE LENDERS, THE GUARANTOR
AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE LENDERS, THE GUARANTOR OR
THE BORROWER. EACH OF THE GUARANTOR AND THE BORROWER ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND
EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS
ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
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ARTICLE XI
GUARANTY PROVISIONS
SECTION 11.1. Guaranty. The Guarantor hereby absolutely, unconditionally
and irrevocably
(a) guarantees the full and punctual payment when due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand
or otherwise, of all Obligations of the Borrower, whether for principal,
interest, fees, expenses or otherwise (including all such amounts which
would become due but for the operation of the automatic stay under Section
362(a) of the United States Bankruptcy Code, 11 U.S.C. Section 362(a), and
the operation of Sections 502(b) and 506(b) of the United States Bankruptcy
Code, 11 U.S.C. Section 502(b) and Section 506(b)); and
(b) indemnifies and holds harmless each Lender and the Agent for any
and all costs and reasonable expenses (including reasonable attorney's fees
and expenses) incurred by such Lender or the Agent, as the case may be, in
enforcing any rights under this Article.
The guaranty contained in this Section constitutes a guaranty of payment of the
Obligations when due and not of collection, and the Guarantor specifically
agrees that it shall not be necessary or required that any Lender or the Agent
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Borrower or any other Person before or as a condition to the
obligations of the Guarantor hereunder.
SECTION 11.2. Acceleration of Guaranty. The Guarantor agrees that upon the
occurrence of any Event of Default of the type set forth in Section 8.1.9 with
regard to the Borrower at a time when any of the Obligations of the Borrower may
not then be due and payable, the Guarantor will pay to the Lenders forthwith the
full amount which would be payable hereunder by the Guarantor if all such
Obligations were then due and payable.
SECTION 11.3. Guaranty Absolute, etc. This Guaranty shall in all respects
be a continuing, absolute, unconditional and irrevocable guaranty of payment,
and shall remain in full force and effect until all Obligations of the Borrower
have been paid in full, all obligations of the Guarantor hereunder shall have
been paid in full and all Commitments shall have terminated. The Guarantor
guarantees that the Obligations of the Borrower will be paid strictly in
accordance with the terms of this Agreement and each other Loan Document under
which they arise, and the
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liability of the Guarantor under this Article shall be absolute, unconditional
and irrevocable irrespective of:
(a) any lack of validity, legality or enforceability of this
Agreement, any Note or any other Loan Document;
(b) the failure of any Lender or the Agent
(i) to assert any claim or demand or to enforce any right or
remedy against the Borrower under the provisions of this Agreement,
any Note, any other Loan Document or otherwise, or
(ii) to exercise any right or remedy against any other guarantor
of, or collateral (if any) securing, any Obligations;
(c) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations or any other extension,
compromise or renewal of any Obligation;
(d) any reduction, limitation, impairment or termination of the
Obligations for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and the
Guarantor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence affecting, the
Obligations or otherwise, except for payment in full of the Obligations;
(e) any amendment to, rescission, waiver, or other modification of, or
any consent to departure from, any of the terms of this Agreement, any Note
or any other Loan Document;
(f) to the extent applicable, any addition, exchange, release,
surrender or non-perfection of any collateral, or any amendment to or
waiver or release or addition of, or consent to departure from, any other
guaranty, held by any Lender or the Agent securing any of the Obligations;
or
(g) any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, the Borrower, any
surety or any guarantor, except for payment in full of the Obligations.
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SECTION 11.4. Reinstatement, etc. The Guarantor agrees that its obligations
under this Article shall continue to be effective or be reinstated, as the case
may be, if at any time any payment (in whole or in part) of any of the
Obligations is rescinded or must otherwise be restored by any Lender or the
Agent, upon the insolvency, bankruptcy or reorganization of the Borrower or
otherwise, all as though such payment had not been made.
SECTION 11.5. Waiver, etc. The Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Obligations and the guaranty contained in this Article and any requirement that
the Agent or any Lender protect, secure, perfect or insure any security interest
or Lien, or any property subject thereto, or exhaust any right or take any
action against the Borrower or any other Person (including any other guarantor)
or entity or any collateral securing the Obligations, as the case may be.
SECTION 11.6. Postponement of Subrogation, etc. The Guarantor will not
exercise any rights which it may acquire by way of rights of subrogation under
this Article, by any payment made hereunder or otherwise, until the prior
payment, in full and in cash, of all Obligations. Any amount paid to the
Guarantor on account of any such subrogation rights prior to the payment in full
of all Obligations shall be held in trust for the benefit of the Lenders and the
Agent and shall immediately be paid to the Agent and credited and applied
against the Obligations, whether matured or unmatured, in accordance with the
terms of this Agreement; provided, however, that if
(a) the Guarantor has made payment to the Lenders and the Agent of all
or any part of the Obligations, and
(b) all Obligations have been paid in full and all Commitments have
been permanently terminated,
each Lender and the Agent agrees that, at the Guarantor's request, the Agent, on
behalf of the Lenders, will execute and deliver to the Guarantor appropriate
documents (without recourse and without representation or warranty) necessary to
evidence the transfer by subrogation to the Guarantor of an interest in the
Obligations resulting from such payment by the Guarantor. In furtherance of the
foregoing, for so long as any Obligations or Commitments remain outstanding, the
Guarantor shall refrain from taking any action or commencing any proceeding
against the Borrower (or its successors or assigns, whether in connection with a
bankruptcy proceeding or otherwise) to recover any amounts in the respect of
payments made under this Article to any Lender or the Agent.
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SECTION 11.7. Judgment. The Guarantor hereby agrees that:
(a) if, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder or under any Loan Document in
Dollars into another currency, the rate of exchange used shall be that at
which in accordance with normal banking procedures the Agent could purchase
Dollars with such other currency on the Business Day preceding that on
which final judgment is given; and
(b) the obligation of the Guarantor in respect of any sum due from it
to any Lender or the Agent hereunder shall, notwithstanding any judgment in
a currency other than Dollars, be discharged only to the extent that on the
Business Day following receipt by such Lender or the Agent, as the case may
be, of any sum adjudged to be so due in such other currency such Lender or
the Agent, as the case may be, may, in accordance with normal banking
procedures, purchase Dollars with such other currency; in the event that
the Dollars so purchased are less than the sum originally due to such
Lender or the Agent in Dollars, the Guarantor, as a separate obligation and
notwithstanding any such judgment, hereby indemnifies and holds harmless
such Lender and the Agent against such loss, and if the Dollars so
purchased exceed the sum originally due to such Lender or the Agent in
Dollars, such Lender or the Agent, as the case may be, shall remit to the
Guarantor such excess.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
FRDK, INC.
By:s/S. Khetrapal
Title:
By:s/D.J. Fischer
Title: Vice President and Controller
Address: 1 First Canadian Place
Toronto, Ontario, Canada
M5X 1G5
Facsimile No.: 416-364-3364
Attention: Joan M. Wilson
with copies to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112-0127
Facsimile No.: 212-541-5369
Attention: Dennis J. Friedman
Moore Corporation Limited
1 First Canadian Place
Toronto, Ontario, Canada
M5X 1G5
Facsimile No.: 416-364-1667
Attention: Shoba Khetrapal
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MOORE CORPORATION LIMITED
By:s/S. Khetrapal
Title: Vice President and Treasurer
By:s/D.J. Fischer
Title: Vice President and Controller
Address: 1 First Canadian Place
Toronto, Ontario, Canada
M5X 1G5
Facsimile No.: 416-364-1667
Attention: Shoba Khetrapal
with a copy to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112-0127
Facsimile No.: 212-541-5369
Attention: Dennis J. Friedman
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<PAGE>
THE BANK OF NOVA SCOTIA,
as Agent
By:s/A.S. Norsworthy
Title: Assistant Agent
Address: 600 Peachtree Street, N.E.
Suite 2700
Atlanta, Georgia 30308
Facsimile No.: 404-888-8998
Attention: Amanda Norsworthy
with a copy to:
The Bank of Nova Scotia
16/F 44 King Street West
Toronto, Ontario M5H 1H1
Facsimile No.: 416-866-2009
Attention: Vice President,
Corporate Banking
Toronto
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<PAGE>
PERCENTAGE LENDERS
100% THE BANK OF NOVA SCOTIA
By:s/A.S. Norsworthy
Title: Assistant Agent
Domestic
Office: 600 Peachtree Street, N.E.
Suite 2700
Atlanta, Georgia 30308
Facsimile No.: 404-888-8998
Attention: Amanda Norsworthy
with a copy to:
The Bank of Nova Scotia
16/F 44 King Street West
Toronto, Ontario M5H 1H1
Facsimile No.: 416-866-2009
Attention: Vice President,
Corporate Banking
Toronto
LIBOR
Office: 600 Peachtree Street, N.E.
Suite 2700
Atlanta, Georgia 30308
Facsimile No.: 404-888-8998
Attention: Amanda Norsworthy
with a copy to:
The Bank of Nova Scotia
16/F 44 King Street West
Toronto, Ontario M5H 1H1
Facsimile No.: 416-866-2009
Attention: Vice President,
Corporate Banking
Toronto
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