<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
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SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
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SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 1-977
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WESTINGHOUSE ELECTRIC CORPORATION
---------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0877540
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(State of Incorporation) (I.R.S. Employer Identification No.)
Westinghouse Building, 11 Stanwix Street, Pittsburgh, Pa. 15222-1384
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(Address of principal executive offices, zip code)
(412) 244-2000
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
--- ---
Common stock 354,889,309 shares outstanding at July 31, 1994
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<PAGE> 2
<TABLE>
WESTINGHOUSE ELECTRIC CORPORATION INDEX
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<CAPTION>
PAGE NO.
---------
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statement of
Income 3-4
Condensed Consolidated Balance Sheet 4-5
Condensed Consolidated Statement of
Cash Flows 6
Notes to the Condensed Consolidated
Financial Statements 7-18
Item 2. Management's Discussion
and Analysis of Financial Condition
and Results of Operations 18-31
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 32-34
Item 4. Submission of Matters to a
Vote of Security Holders 34-35
Item 6. Exhibits and Reports on
Form 8-K 35-37
SIGNATURE 37
</TABLE>
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<PAGE> 3
PART I. FINANCIAL INFORMATION
<TABLE>
ITEM 1. FINANCIAL STATEMENTS
WESTINGHOUSE ELECTRIC CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
------------------------------------------
(in millions except per share amounts) (unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
------- -------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales of products and services $ 2,108 $ 2,154 $ 3,851 $ 4,174
Costs of products and services (1,568) (1,602) (2,917) (3,154)
Marketing, administration and
general expenses (386) (367) (715) (689)
Other income and expenses, net
(note 2) 16 2 55 8
Interest expense (45) (52) (92) (105)
------- ------- ------- -------
Income from Continuing Operations
before income taxes and minority
interest in income of
consolidated subsidiaries 125 135 182 234
Income taxes (47) (50) (69) (86)
Minority interest in income of
consolidated subsidiaries (3) (1) (2) (5)
------- ------- ------- -------
Income from Continuing Operations
before cumulative effect of change
in accounting principle 75 84 111 143
Cumulative effect of change in
accounting principle:
Postemployment benefits (note 3) - - - (56)
------- ------- ------- -------
Net income $ 75 $ 84 $ 111 $ 87
======= ======= ======= =======
</TABLE>
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<PAGE> 4
<TABLE>
CONDENSED CONSOLIDATED STATEMENT OF INCOME (CONTINUED)
------------------------------------------------------
(In millions except per share amounts) (unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
------- -------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Earnings per common share:
From Continuing Operations $ 0.16 $ 0.20 $ 0.23 $ 0.34
From cumulative effect of change
in accounting principle - - - (0.16)
------- ------- ------- -------
Earnings per common share $ 0.16 $ 0.20 $ 0.23 $ 0.18
======= ======= ======= =======
Cash dividends per common share $ 0.05 $ 0.10 $ 0.10 $ 0.20
</TABLE>
See Notes to the Condensed Consolidated Financial Statements
<TABLE>
WESTINGHOUSE ELECTRIC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
------------------------------------
(in millions)
<CAPTION>
June 30 December 31
1994 1993
---- ----
(unaudited)
<S> <C> <C>
ASSETS
- ------
Cash and cash equivalents $ 426 $ 637
Customer receivables 1,264 1,381
Inventories (note 4) 1,617 1,549
Uncompleted contracts costs over
related billings 369 371
Prepaid and other current assets 854 836
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Total current assets 4,530 4,774
Plant and equipment, net 1,883 1,964
Intangible and other noncurrent assets 3,729 3,815
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Total assets $10,142 $10,553
======= =======
</TABLE>
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<PAGE> 5
<TABLE>
CONDENSED CONSOLIDATED BALANCE SHEET (CONTINUED)
------------------------------------------------
(in millions)
<CAPTION>
June 30 December 31
1994 1993
---- ----
(unaudited)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Short-term debt $ 106 $ 662
Current maturities of long-term debt 14 9
Accounts payable 591 656
Uncompleted contracts billings over
related costs 462 672
Other current liabilities 1,633 1,926
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Total current liabilities 2,806 3,925
Long-term debt 1,881 1,885
Net liabilities of Discontinued Operations 211 211
Other noncurrent liabilities 3,591 3,453
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Total liabilities 8,489 9,474
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Contingent liabilities and commitments
(note 6)
Minority interest in equity of
consolidated subsidiaries 32 34
Shareholders' equity (note 7):
Preferred stock, $1.00 par value (25
million shares authorized):
Series A preferred (no shares
issued) - -
Series B conversion preferred
(8 million shares issued) 8 8
Series C conversion preferred
(4 million shares issued) 4 -
Common stock, $1.00 par value
(630 million and 480 million shares
authorized, 393 million shares issued) 393 393
Capital in excess of par value 1,956 1,475
Common stock held in treasury (922) (972)
Other (1,261) (1,260)
Retained earnings 1,443 1,401
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Total shareholders' equity 1,621 1,045
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Total liabilities and shareholders'
equity $10,142 $10,553
======= =======
</TABLE>
See Notes to the Condensed Consolidated Financial Statements
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<TABLE>
WESTINGHOUSE ELECTRIC CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
----------------------------------------------
(in millions) (unaudited)
<CAPTION>
Six Months Ended
June 30
-------
1994 1993
---- ----
<S> <C> <C>
CONTINUING OPERATIONS:
Cash provided by Operating Activities $ 4 $ 73
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Cash Flows from Investing Activities
Capital Expenditures (92) (81)
Business Divestitures 50 -
Business Acquisitions (73) -
Other (9) -
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Cash used by Investing Activities (124) (81)
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Cash Flows from Financing Activities
Change in short-term debt (551) (61)
Sale of equity securities 505 -
Dividends (69) (96)
Other 24 46
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Cash used by Financing Activities (91) (111)
------- -------
Cash used by Continuing Operations (211) (119)
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DISCONTINUED OPERATIONS:
Operating Activities (175) (146)
Investing Activities 1,578 2,305
Financing Activities (2,008) (2,398)
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Cash used by Discontinued Operations (605) (239)
------- -------
Decrease in cash and cash equivalents (816) (358)
Cash and cash equivalents at beginning
of period 1,248 1,554
------- -------
Cash and cash equivalents at end of
period $ 432 $ 1,196
======= =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest paid -- Continuing Operations $ 92 $ 119
Interest paid -- Discontinued Operations 127 271
Income taxes paid 76 33
</TABLE>
See Notes to the Condensed Consolidated Financial Statements
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<PAGE> 7
WESTINGHOUSE ELECTRIC CORPORATION
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------
1. GENERAL
The condensed consolidated financial statements include the accounts
of Westinghouse Electric Corporation (Westinghouse), and its
subsidiary companies (together, the Corporation) after elimination of
intercompany accounts and transactions.
In the opinion of the management of the Corporation, the condensed
consolidated financial statements include all material adjustments
necessary to present fairly the Corporation's financial position,
results of operations and cash flows. Such adjustments are of a
normal recurring nature. The results for this interim period are not
necessarily indicative of results for the entire year.
When reading the financial information contained in this Quarterly
Report, reference should be made to the financial statements,
schedules and notes contained in the Corporation's Annual Report on
Form 10-K for the year ended December 31, 1993.
2. OTHER INCOME AND EXPENSES, NET (in millions) (unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
------- -------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net gain (loss) on disposition
of other assets $11 $(1) $46 $4
Miscellaneous other income and
expenses, net 5 3 9 4
--- --- --- --
Other income and expenses, net $16 $ 2 $55 $8
=== === === ==
</TABLE>
The net gain on disposition of other assets for the six months ended
June 30, 1994 includes a first quarter gain of $32 million from the
sale of two Sacramento radio stations and a second quarter gain of
$10 million at WCI from the sale of an investment in a shopping center
development joint venture.
3. CHANGE IN ACCOUNTING PRINCIPLE
In December 1993, the Corporation adopted, retroactive to January 1,
1993, Statement of Financial Accounting Standards (SFAS) No. 112
"Employers' Accounting for Postemployment Benefits." This statement
requires employers to adopt accrual accounting for workers'
compensation, salary continuation, medical and life insurance
continuation, severance benefits and disability benefits provided to
former or inactive employees after employment but before retirement.
The retroactive adoption of SFAS No. 112 resulted in a first quarter
1993 after-tax charge for postemployment benefits at January 1, 1993
of $56 million, or $.16 per share.
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<PAGE> 8
4. INVENTORIES (in millions)
<TABLE>
<CAPTION>
June 30 December 31
1994 1993
---- ----
(unaudited)
<S> <C> <C>
Raw materials $ 136 $ 137
Work in process 1,147 989
Finished goods 123 104
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1,406 1,230
Long-term contracts in process 677 678
Progress payments to subcontractors 117 124
Recoverable engineering and
development costs 569 442
Less: Inventoried costs related to
contracts with progress billing
terms (1,152) (925)
------- -------
Inventories $ 1,617 $ 1,549
======= =======
</TABLE>
5. DISCONTINUED OPERATIONS
In November 1992, the Corporation announced a Plan (the Plan) that
included exiting the financial services business and the sale of
other non-strategic businesses. The Corporation classified the
operations of Distribution and Control Business Unit (DCBU),
Westinghouse Electric Supply Company (WESCO) (collectively, Other
Operations) and Financial Services as discontinued operations in
accordance with Accounting Principles Board Opinion No. 30,
"Reporting the Results of Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions" (APB 30). Under
this Plan, the disposition of The Knoll Group (Knoll) was scheduled
to occur by the end of 1994 and WCI Communities, Inc. (WCI) by the
end of 1995.
In January 1994, the Corporation announced that Knoll was no
longer for sale and the planned sale of WCI would be accelerated from 1995
into 1994. The Corporation is continuing to evaluate alternatives with
respect to WCI to optimize its value. The Corporation will use WCI's
positive cash flow from operations to pay down debt of Discontinued
Operations.
Since adoption of the Plan, net portfolio investments of Financial
Services have decreased from $5,534 million at November 30, 1992, to $982
million at June 30, 1994, a decrease of $4,552 million. In the
first quarter of 1994, the Corporation completed the sales of DCBU,
for a purchase price in excess of $1.1 billion and WESCO for a
purchase price of approximately $340 million.
A reserve for the estimated loss on the disposal of Discontinued
Operations of $1,383 million after-tax was established in November 1992.
In the fourth quarter of 1993, the Corporation recorded an additional
provision for estimated loss on the disposal of Discontinued
Operations of $95 million after-tax based on changes in estimates on the
sales of DCBU and WESCO, a decision to bulk sell certain Financial Services
assets and a revision to estimated interest expense.
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<PAGE> 9
<TABLE>
Operating Results of Discontinued Operations
(in millions) (unaudited)
<CAPTION>
Financial DCBU &
Services WESCO Total
--------- ------ -----
<S> <C> <C> <C>
Three Months Ended June 30, 1994
--------------------------------
Sales of products and services $ 11 $ - $ 11
Net losses (47) - (47)
Three Months Ended June 30, 1993
--------------------------------
Sales of products and services $ 120 $ 605 $ 725
Net earnings (losses) (36) 11 (25)
Six Months Ended June 30, 1994
------------------------------
Sales of products and services $ 25 $ 319 $ 344
Net earnings (losses) (116) 4 (112)
Six Months Ended June 30, 1993
------------------------------
Sales of products and services $ 227 $1,156 $1,383
Net earnings (losses) (88) 21 (67)
</TABLE>
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<PAGE> 10
The assets and liabilities of Discontinued Operations have been
separately classified in the condensed consolidated balance
sheet as net liabilities of Discontinued Operations. A summary
of these assets and liabilities follows:
<TABLE>
NET LIABILITIES OF DISCONTINUED OPERATIONS
<CAPTION>
June 30 December 31
1994 1993*
(in millions) ---- -----
(unaudited)
<S> <C> <C>
ASSETS:
Cash and cash equivalents $ 6 $ 611
Other current assets 22 742
Portfolio investments, net 982 1,127
Plant and equipment, net 3 360
Accrued estimated gain on sale of
Discontinued Operations - 441
Accrued operating income, net - 19
Deferred income taxes 432 415
Other assets 189 375
------ ------
Total assets -- Discontinued
Operations 1,634 4,090
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LIABILITIES:
Short-term debt 750 2,373
Current maturities of long-term debt 260 774
Other current liabilities 22 338
Long-term debt 759 647
Other liabilities and accrued
operating expenses 54 169
------ ------
Total liabilities -- Discontinued
Operations 1,845 4,301
------ ------
Net liabilities of Discontinued
Operations $ 211 $ 211
====== ======
<FN>
*Certain amounts have been reclassified for comparative purposes.
</TABLE>
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<PAGE> 11
FINANCIAL SERVICES PORTFOLIO INVESTMENTS
Portfolio Investments by Category of Investment and Financing at June 30,
1994 and December 31, 1993 are summarized in the following table.
<TABLE>
<CAPTION>
At June 30, 1994
----------------------------------------
Real
(in millions) (unaudited) Leasing Estate Corporate Total
------- ------ --------- -----
<S> <C> <C> <C> <C>
Receivables $ 919 $ 33 $ 16 $ 968
Other portfolio investments 39 320 16 375
------ ----- ---- ------
Portfolio investments 958 353 32 1,343
Valuation allowance (45) (309) (7) (361)
------ ----- ---- ------
Portfolio investments, net $ 913 $ 44 $ 25 $ 982
====== ===== ==== ======
</TABLE>
<TABLE>
<CAPTION>
At December 31, 1993*
----------------------------------------
Real
(in millions) Leasing Estate Corporate Total
------- ------ --------- -----
<S> <C> <C> <C> <C>
Receivables $ 969 $ 46 $ 47 $1,062
Other portfolio investments 39 353 97 489
------ ----- ---- ------
Portfolio investments 1,008 399 144 1,551
Valuation allowance (45) (353) (26) (424)
------ ----- ---- ------
Portfolio investments, net $ 963 $ 46 $118 $1,127
====== ===== ==== ======
<FN>
*Certain amounts have been recategorized for comparative purposes.
</TABLE>
Leasing receivables consist of direct financing and leveraged leases. At
June 30, 1994, 79% of leasing receivables related to aircraft and 18%
related to cogeneration facilities. At June 30, 1994, the Corporation's
leasing portfolio included approximately $120 million of leasing
receivables, primarily leveraged, related to aircraft leased by USAir,
Inc., a major U.S. airline. Such leasing receivables were current as to
payments and performing in accordance with contractual terms at June 30,
1994, and are not considered to be potential problem receivables. Certain
leasing receivables classified as performing and totalling $150 million at
June 30, 1994 have been identified by management as potential problem
receivables.
Real estate receivables consist of loans for commercial and residential
real estate properties and were comprised primarily of residential loans at
June 30, 1994. Corporate receivables represent the remainder of the
receivables resulting from highly-leveraged transactions.
Non-earning receivables at June 30, 1994 totalled $40 million. There were
no reduced earning receivables at June 30, 1994. The difference between
the income for the second quarter and first half of 1994 that would have
been earned on non-earning receivables at June 30, 1994, and the income
that was actually earned, was not significant.
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<PAGE> 12
Other portfolio investments at June 30, 1994 include the Corporation's
investment in LW Real Estate Investments, L.P. (LW) of $133 million, real
estate properties totalling $101 million, and other investments totalling
$141 million primarily comprised of real estate and leasing investments in
partnerships. The Corporation's investment in LW at June 30, 1994
represented a 44% limited partnership interest. LW was formed in April
1993 and purchased over half of Financial Services commercial real estate
assets in several transactions during the remainder of 1993. An affiliate
of the investment banking firm, Lehman Brothers, is the general partner.
The Plan calls for the run-off of the leasing portfolio in accordance with
contractual terms. Management expects a significant portion of the
Corporation's investment in LW and any remaining real estate assets to be
liquidated by the end of 1995. The remaining corporate assets are expected
to be liquidated during the remainder of 1994.
The following table is a reconciliation of the valuation allowance for
portfolio investments for the six months ended June 30, 1994.
<TABLE>
VALUATION ALLOWANCE FOR PORTFOLIO INVESTMENTS
(in millions) (unaudited)
<CAPTION>
Transfers to
Reserve for
Portfolio Accrued Percent of
Beginning Investments Operating Ending Portfolio
Balance Written Off Expenses Balance Investments
------- ----------- -------- ------- -----------
<S> <C> <C> <C> <C> <C>
Category of
Financing:
Leasing $ 45 $ - $ - $ 45 4.7%
Real Estate 353 (3) (41) 309 87.6%
Corporate 26 (19) - 7 22.0%
---- ---- ---- ----
Total $424 $(22) $(41) $361 26.9%
==== ==== ==== ====
</TABLE>
During the first half of 1994, portfolio investments written off represented
1.6% of average outstanding portfolio investments. Investments written off
during the first half of 1994 usually resulted from the disposition of the
asset for cash.
The valuation allowance for real estate portfolio investments at June 30,
1994 and December 31, 1993 included approximately $180 million and $195
million, respectively, related to real estate assets sold at values in
excess of those used in determining the valuation allowance at the time the
Plan was developed. During the second quarter of 1994, $41 million of the
valuation allowance for real estate portfolio investments was transferred
to the reserve for accrued operating expenses to offset the operating
expenses, primarily comprised of interest expense, of Financial Services
through June 30, 1994. It is expected that these amounts in excess of the
valuation allowances will be used to offset future operating expenses of
Financial Services and any differences that may arise in estimates of other
elements of the Plan.
Management currently believes that the reserve for the estimated loss on the
disposal of Discontinued Operations should be adequate. The adequacy of this
reserve is evaluated each quarter.
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<PAGE> 13
6. CONTINGENT LIABILITIES AND COMMITMENTS
Uranium Settlements
-------------------
The Corporation had previously provided for all estimated future
costs associated with the resolution of all uranium supply contract
suits and related litigation. The remaining uranium reserve balance
includes uranium settlement assets and reserves for estimated future
costs. The remaining balance at June 30, 1994 is deemed adequate
considering all facts and circumstances known to management. The
future obligations require providing specific quantities of uranium
and products and services over a period extending beyond the year
2010. Variances from estimates which may occur will be considered
in determining if an adjustment of the reserve is necessary.
Litigation
----------
Republic of the Philippines and National Power Corporation
In December 1988, the Republic of the Philippines (Philippines) and
National Power Corporation of the Philippines (NPC) (collectively,
the Republic) filed a 15 count lawsuit in the United States District
Court (USDC) for the District of New Jersey against the Corporation
in connection with the construction of a nuclear power plant in the
Philippines. In 1989, the USDC stayed substantially all of the
complaint pending arbitration by the International Chamber of
Commerce (ICC) in Geneva, Switzerland. The USDC did not grant a stay
with respect to the one count in the complaint alleging intentional
interference with a fiduciary relationship. A jury verdict with
respect to this count was rendered in favor of the Corporation on
May 18, 1993. The Republic has stated its intention to appeal this
verdict.
The Philippines and NPC challenged the jurisdiction of the ICC,
claiming the contract was invalid due to the alleged bribery in the
procurement of the contract. In December 1991, the ICC arbitration
panel issued an award finding that the NPC had failed to carry its
burden of proving an alleged bribery by the Corporation. The panel
thereby concluded that the arbitration clauses and the contracts
were valid and the panel had jurisdiction over the disputes
remaining before it with respect to NPC. The panel concluded that
it did not have jurisdiction over the Philippines. NPC, in an
attempt to attack the ICC decision regarding jurisdiction and
contract validity, filed an action for annulment with the Swiss
Federal Supreme Court which was not successful. Arbitration with
respect to the remaining disputes before the ICC is ongoing.
Steam Generators
At present, there are six pending actions brought by utilities
claiming a substantial amount of damages in connection with alleged
tube degradation in steam generators sold by the Corporation as
components for nuclear steam supply systems. Westinghouse is also a
party to six agreements with utilities or utility plant owners'
groups which toll the statute of limitations regarding their steam
generator tube degradation claims and permit the parties time to
engage in discussions. The parties have agreed that no litigation
will be initiated for an agreed upon period of time as set forth in
the respective tolling agreements. The term of each tolling
agreement varies. Westinghouse has notified its insurance carriers
of the pending steam generator actions and claims. While some of
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<PAGE> 14
the carriers have denied coverage in whole or in part, most have
reserved their rights with respect to obligations to defend and
indemnify the Corporation. The coverage is the subject of
litigation between the Corporation and these carriers.
Securities Class Actions - Financial Services
The Corporation has been defending a consolidated class action, a
consolidated derivative action and certain individual lawsuits
brought against the Corporation, WFSI and WCC, both previously
subsidiaries of the Corporation, and/or certain present and former
directors and officers of the Corporation, as well as other
unrelated parties. Together, these actions allege various federal
securities law and common law violations arising out of alleged
misstatements or omissions contained in the Corporation's public
filings concerning the financial condition of the Corporation, WFSI
and WCC in connection with a $975 million charge to earnings
announced on February 27, 1991, a public offering of Westinghouse
common stock in May 1991, a $1,680 million charge to earnings
announced on October 7, 1991, and alleged misrepresentations
regarding the adequacy of internal controls at the Corporation, WFSI
and WCC.
Litigation is inherently uncertain and always difficult to predict.
Substantial damages are sought in each of the foregoing cases and
although management believes a significant adverse judgment is
unlikely, any such judgment could have a material adverse effect
upon the Corporation's results of operations for a quarter or a
year. However, based on its understanding and evaluation of the
relevant facts and circumstances, management believes the
Corporation has meritorious defenses to the litigation described
above and management believes that the litigation should not have a
material adverse effect on the financial condition of the
Corporation.
Environmental Matters
---------------------
Compliance with federal, state and local regulations relating to the
discharge of substances into the environment, the disposal of
hazardous wastes and other related activities affecting the
environment have had and will continue to have an impact on the
Corporation. While it is difficult to estimate the timing and
ultimate costs to be incurred in the future due to uncertainties
about the status of laws, regulations, technology and information
available for individual sites, management estimates the total
probable and reasonably possible remediation costs that could be
incurred by the Corporation based on the facts and circumstances
currently known. Such estimates include the Corporation's
experience to date with investigating and evaluating site cleanup
costs, the professional judgment of the Corporation's environmental
experts, outside environmental specialists and other experts and,
when necessary, counsel. In addition, the likelihood that other
parties which have been named as potentially responsible parties
(PRPs) will have the financial resources to fulfill their
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<PAGE> 15
obligations at Superfund sites where they and the Corporation may be
jointly and severally liable has been considered. These estimates
have been used to assess materiality for financial statement
disclosure purposes as follows.
PRP Sites
With regard to remedial actions under federal and state superfund
laws, the Corporation has been named as a PRP at numerous sites
located through the country. At many of these sites, the
Corporation is either not a responsible party or its site
involvement is very limited or de minimus. However, the Corporation
may have varying degrees of cleanup responsibilities at 52 of these
sites, excluding those discussed in the preceding sentence. With
regard to cleanup costs at these sites, in many cases the
Corporation will share these costs with other responsible parties
and the Corporation believes that any liability incurred will be
satisfied over a number of years. Management believes the total
remaining probable costs which the Corporation could incur for
remediation of these sites as of June 30, 1994 are approximately $60
million, all of which has been accrued. These remediation actions
are expected to occur over a period of several years. As the
remediation activities progress, additional information may be
obtained which may require additional investigations or an expansion
of the remediation activities. This may result in an increase in
site remediation costs; however, until such time as additional
requirements are identified during the remediation process, the
Corporation is unable to reasonably estimate what those costs might
be.
Bloomington Consent Decree
The Corporation is a party to a 1985 Consent Decree relating to
remediation of six sites in Bloomington, Indiana. The Corporation
has additional responsibility for two other sites in Bloomington not
included as part of the Consent Decree. In the Consent Decree, the
Corporation agreed to construct and operate an incinerator, which
would be permitted under federal and state law to burn excavated
material.
On February 8, 1994, the parties filed a status report with the
United States District Court for the Southern District of Indiana,
which is responsible for overseeing the implementation of the
Consent Decree. This report advised the court of the parties'
intention to investigate alternatives and provided the court with
operating principles for this process. During the second quarter of
1994, the parties initiated a series of meetings under the operating
principles agreement to review available technical information that
may be required to investigate an alternative proposal.
The Corporation believes it is probable the Consent Decree will be
modified to an alternate remediation action. As a result, the
Corporation estimates that its costs to implement the most
reasonable and likely alternative would be approximately $60
million, all of which has been accrued. Approximately $16 million
of this estimate represents operating and maintenance costs which
will be incurred over an approximate 30 year period. These costs
are expected to be distributed equally over this period and, based
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<PAGE> 16
on the Corporation's experience with similar operating and
maintenance costs, have been determined to be reliably determinable
on a year-to-year basis. Accordingly, the estimated $44 million
gross cost of operating and maintenance has been discounted at a
rate of 5% per year which results in the above described $16 million
charge. The remaining portion of the $60 million charge represents
site construction and other related costs and is valued as of the
year of expenditure. Analyses of internal experts and outside
consultants have been used in forecasting construction and other
related costs. The estimates of future period costs include an
assumed inflation rate of 5% per year. This estimate of $60 million
is within a range of reasonably possible alternatives and one which
the Corporation believes to be the most likely outcome. This
alternative includes a combination of containment, treatment,
remediation and monitoring. Other alternatives, while considered
less likely, could cause such costs to be as much as $100 million.
The parties recognize that at the end of the process, they may
conclude that the remedy currently provided in the Consent Decree is
the most appropriate. The parties also recognize that the Consent
Decree shall remain in full force during this process. The
Corporation and the other parties may have claims against each other
under the Consent Decree if a mutually agreeable alternative is not
reached. The Corporation may be required to post security for 125%
of the net cost to complete remediation in the event certain
requirements of the Consent Decree are not met. The Corporation
believes it has met all of these requirements.
Other Sites
The Corporation is involved with several administrative actions
alleging violations of federal, state or local environmental
regulations. For these matters, the Corporation has estimated its
remaining reasonably possible costs and determined them to be
insignificant.
The Corporation currently manages under contract several government-
owned facilities, which among other things are engaged in the
remediation of hazardous and nuclear wastes. To date, under the
terms of the contracts, the Corporation is not responsible for costs
associated with environmental liabilities, including environmental
cleanup costs, except under certain circumstances associated with
negligence and willful misconduct. There are currently no known
claims for which the Corporation believes it is responsible. In
1994, the U.S. Department of Energy (DoE) announced its intention to
renegotiate its existing contracts for maintenance and operation of
DoE facilities to address environmental issues.
The Corporation has or will have responsibilities for environmental
remediation such as dismantling incinerators, decommissioning
nuclear licensed sites, and other similar commitments at various
sites. The Corporation has estimated total potential cost to be
incurred for these actions to be approximately $134 million, of
which $38 million had been accrued at June 30, 1994. The
Corporation's policy is to accrue these costs over the estimated
lives of the individual facilities which in most cases is
approximately 20 years. The anticipated annual costs currently
being accrued are $6 million.
- 16 -
<PAGE> 17
Insurance Recoveries
In 1987, the Corporation filed an action in New Jersey against over
100 insurance companies seeking recovery for these and other
environmental liabilities and litigation involving personal injury
and property damage. The Corporation has received certain
recoveries from insurance companies related to environmental costs.
The Corporation has not accrued for any future insurance recoveries.
Based on the above discussion and including all information
presently known to the Corporation, management believes that the
environmental matters described above will not have a material
adverse effect on the Corporation's capital resources, liquidity,
financial condition and results of operations.
Financing Commitments -- Discontinued Operations
------------------------------------------------
Financial Services commitments with off-balance-sheet credit risk
represent financing commitments to provide funds, including loan or
investment commitments, guarantees, standby letters of credit and
standby commitments, generally in exchange for fees. The remaining
commitments have fixed expiration dates from 1994 through 2002.
At June 30, 1994, Financial Services commitments with off-balance-
sheet credit risk totalled $94 million compared to $111 million at
year-end 1993. Of the $94 million of commitments at June 30, 1994,
$83 million were guarantees, credit enhancements and other standby
agreements, and $11 million were commitments to extend credit. Of
the $111 million of commitments at year-end 1993, $90 million were
guarantees, credit enhancements and other standby agreements and $21
million were commitments to extend credit. Management expects the
remaining commitments to either expire unfunded, be assumed by the
purchaser in asset dispositions or be funded with the resulting
assets being sold shortly after funding.
Financing Commitments -- Continuing Operations
----------------------------------------------
During 1993, various guarantees were transferred from Financial
Services to Continuing Operations. These guarantees were originally
issued primarily to improve the salability of securities of
Financial Services corporate customers and are collateralized by the
assets of the customer. At June 30, 1994, the remainder of these
guarantees totalled $16 million. Management does not expect the
Corporation to be required to fund these guarantees.
WCI was contingently liable at June 30, 1994 under guarantees for
$64 million of sewer and water district borrowings. The proceeds of
the borrowings were used for sewer and water improvements on
residential and commercial real estate projects of WCI. Management
expects these borrowings to be repaid as the projects are completed
and sold, and the guarantees for such borrowings to expire unfunded.
- 17 -
<PAGE> 18
Other Commitments
-----------------
The Corporation's other commitments consisting primarily of those
for the purchase of plant and equipment are not material.
7. SHAREHOLDERS' EQUITY
In March 1994, the Corporation sold, in a private placement,
36,000,000 depositary shares at $14.44 per share. Each of the
depositary shares represents ownership of one-tenth of a share of
the Corporation's $1 par value Series C Conversion Preferred Stock
(C Preferred) and entitles the owner to all of the proportionate
rights, preferences and privileges of the C Preferred.
The net proceeds to the Corporation, after commissions, fees, and
out-of-pocket expenses, totalled $505 million which was used to
reduce short-term debt. As a result of the transaction, par value
of C Preferred was established for $4 million, and capital in excess
of par was increased by $501 million.
The C Preferred shares were treated as a common stock equivalent for
the calculation of earnings per share for all 1994 periods
presented.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
OVERVIEW
Orders entered for the second quarter of 1994 increased by $61 million,
while orders for the first half of 1994 decreased by $131 million compared
to the same periods last year. Orders in all core segments increased for
the quarter except for Energy Systems which benefitted in the second
quarter of 1993 from the $440 million order for fuel and control systems at
the Temelin plant in the Czech Republic. Backlog increased by $196 million
at June 30, 1994 compared to June 30, 1993.
Sales of products and services were down $46 million and $323 million,
respectively, for the second quarter and first half of 1994 compared to the
same periods of 1993. Operating profit was down $31 million and $112
million, respectively, for the second quarter and first half of 1994
compared to the same periods of last year. Increased pension expense and
reduced licensee income had negative impacts on the 1994 results, while the
first half of 1993 benefitted from a change in accounting for nuclear fuel
revenues.
Net income was $75 million for the second quarter of 1994 and $111 million
for the first six months of 1994 compared to $84 million and $87 million
for the comparable periods of 1993. Net income for the first half of 1993
included a $56 million first quarter 1993 after-tax charge for the adoption
of Statement of Financial Accounting Standards (SFAS) No. 112, "Employers'
Accounting for Postemployment Benefits." Excluding the charge for SFAS No.
112, income before cumulative effect of change in accounting principle for
the first half of 1993 was $143 million.
- 18 -
<PAGE> 19
Earnings per share were $.16 for the second quarter of 1994 and $.23 for
the first six months of 1994 compared to $.20 and $.18 for the same periods
of 1993. The first six months of 1993 included earnings of $.34 from
Continuing Operations and a first quarter 1993 charge of $.16 per share for
the adoption of SFAS No. 112.
RESTRUCTURING
On January 11, 1994, the Corporation announced a charge totalling $350
million for restructuring of its continuing businesses, which included
approximately $225 million related to separation costs for 3,400 employees,
approximately $35 million associated with asset writedowns, approximately
$45 million for facility closedown and rationalization costs and
approximately $45 million related to process and product redesign or
reengineering.
The Corporation anticipated that actions resulting from implementation of
its restructuring plan, directed to improving productivity and operating
performance, would result in the reduction of approximately 6,000
employees, which includes the previously-discussed 3,400 separations and an
additional 2,600 reductions expected to result from normal attrition.
Through the end of June 1994, employee reductions as a result of
implementing the restructuring plan totalled approximately 2,200 employees.
The 3,400 employee separations that were included as part of the
restructuring charge are expected to result in annual pre-tax savings of
approximately $100 million, primarily through reduced employment costs. A
substantial portion of this annual savings is expected to be realized in
1994, with approximately $300 million in savings expected over the three-
year period ending December 31, 1996. Additional savings will be realized
as the anticipated reductions resulting from normal attritions occur over
the next two years.
Total cash expenditures for restructuring through 1996 are expected to
approximate $270 million, with expenditures of approximately $180 million
in 1994, $55 million in 1995 and $35 million in 1996. During the first six
months of 1994, charges against the reserve totalled $161 million and
consisted primarily of asset writedowns and employee separation costs.
Cash expenditures for restructuring during the first six months of 1994
totalled $96 million.
ASSET SALES
Also on January 11, 1994, the Corporation announced plans to dispose of
certain non-strategic businesses including parts of the former
Environmental Services business unit and certain businesses in the
Industrial Products and Services business unit and recorded a $215 million
charge during the fourth quarter of 1993. This charge included all
associated costs anticipated to be incurred in disposing of these
businesses, including estimates for the cost of certain possible
environmental remediation which may result from the selling process.
Estimated sales proceeds for these businesses of approximately $175 million
were determined from various sources, including offers contained in bona
fide letters of interest received from third parties, estimates from
investment banking firms retained by the Corporation or certain internal
sources. Also included in the $215 million charge is approximately $20
million for the writedown of certain assets related to discontinued
projects. In May 1994, the Corporation completed the sale of Controlmatic,
- 19 -
<PAGE> 20
which has principal operations in Germany, Switzerland, Austria and Italy.
The Corporation continues to pursue the disposition of the remaining non-
strategic businesses. Through June 30, 1994, charges against the reserve
for disposition totalled $22 million.
DISCONTINUED OPERATIONS
In November 1992, the Corporation announced a Plan (the Plan) that included
exiting the financial services business and the sale of other non-strategic
businesses. The Corporation classified the operations of Distribution and
Control Business Unit (DCBU), Westinghouse Electric Supply Company (WESCO)
(collectively, Other Operations) and Financial Services as discontinued
operations in accordance with Accounting Principles Board Opinion No. 30,
"Reporting the Results of Operations - Reporting the Effects of Disposal of
a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions" (APB 30). Under this Plan, the
disposition of The Knoll Group (Knoll) was scheduled to occur by the end of
1994 and WCI Communities, Inc. (WCI) by the end of 1995.
In January 1994, the Corporation announced that Knoll was no longer for
sale and the planned sale of WCI would be accelerated from 1995 into 1994.
The Corporation is continuing to evaluate alternatives with respect
to WCI to optimize its value. The Corporation will use WCI's positive
cash flow from its operations to pay down debt of Discontinued Operations.
Since adoption of the Plan, net portfolio investments of Financial Services
have decreased from $5,534 million at November 30, 1992, to $982 million at
June 30, 1994, a decrease of $4,552 million. The Corporation completed the
sales of DCBU and WESCO during the first quarter of 1994. See Liquidity
and Capital Resources - Overview.
The reserve for the estimated loss on the disposal of Discontinued
Operations of $1,383 million after-tax was established in November 1992.
In the fourth quarter of 1993, the Corporation recorded an additional
provision for estimated loss on the disposal of Discontinued Operations of
$95 million after-tax based on changes in estimates on the sales of DCBU
and WESCO, a decision to bulk sell certain Financial Services assets and a
revision to estimated interest expense.
Management currently believes that the reserve for the estimated loss
on disposal of Discontinued Operations should be adequate. The adequacy of
this reserve is evaluated each quarter.
- 20 -
<PAGE> 21
RESULTS OF OPERATIONS
The Corporation's Continuing Operations have been realigned so that each
core business is now reported as a separate segment. As a result, the
former Power Systems segment has been replaced by separate segments for
Energy Systems and Power Generation and the former Industries segment has
been replaced by separate segments for Thermo King and Other Businesses.
Other Businesses includes those businesses that have been identified for
sale - the Industrial Products and Services business unit, Resource Energy
Systems and Controlmatic. Resource Energy Systems and Controlmatic were
formerly part of the Government and Environmental Services segment.
Westinghouse Communications has been transferred to the Broadcasting
segment.
<TABLE>
Segment Results
---------------
(in millions) (unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1994 1993 % Change 1994 1993 % Change
---- ---- -------- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C>
Broadcasting
Orders $ 228.3 $ 218.7 4.4% $ 418.8 $ 397.4 5.4%
Backlog - - - - - -
Sales 228.3 218.7 4.4% 418.8 397.4 5.4%
Operating Profit (Loss) 57.6 49.6 16.1% 91.3 76.1 20.0%
Operating Profit Margin 25.2% 22.7% N/A 21.8% 19.1% N/A
Depreciation &
Amortization (D&A) 9.4 9.0 4.4% 18.6 18.3 1.6%
Capital Expenditures 10.3 3.2 221.9% 15.7 6.1 157.4%
Electronic Systems
Orders $ 530.6 $ 376.3 41.0% $ 917.5 $1,004.9 -8.7%
Backlog 3,932.3 3,705.0 6.1% 3,932.3 3,705.0 6.1%
Sales 487.9 623.7 -21.8% 937.8 1,219.7 -23.1%
Operating Profit (Loss) 21.8 49.8 -56.2% 61.2 101.8 -39.9%
Operating Profit Margin 4.5% 8.0% N/A 6.5% 8.3% N/A
D&A 18.7 19.8 -5.6% 37.3 39.6 -5.8%
Capital Expenditures 11.7 7.6 53.9% 18.9 15.8 19.6%
Government and
Environmental Services
Orders $ 76.4 $ 63.7 19.9% $ 144.0 $ 126.9 13.5%
Backlog 86.4 41.3 109.2% 86.4 41.3 109.2%
Sales 99.7 81.6 22.2% 183.5 158.1 16.1%
Operating Profit (Loss) 18.9 21.2 -10.8% 28.9 40.9 -29.3%
Operating Profit Margin 19.0% 26.0% N/A 15.7% 25.9% N/A
D&A 5.4 3.6 50.0% 11.0 7.2 52.8%
Capital Expenditures 5.4 8.3 -34.9% 6.8 13.2 -48.5%
</TABLE>
- 21 -
<PAGE> 22
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1994 1993 % Change 1994 1993 % Change
---- ---- -------- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C>
Thermo King
Orders $ 241.2 $ 175.4 37.5% $ 489.2 $ 398.4 22.8%
Backlog 237.4 159.9 48.5% 237.4 159.9 48.5%
Sales 225.6 188.8 19.5% 412.4 363.4 13.5%
Operating Profit (Loss) 34.8 31.4 10.8% 61.6 57.1 7.9%
Operating Profit Margin 15.4% 16.6% N/A 14.9% 15.7% N/A
D&A 4.0 3.2 25.0% 7.7 6.5 18.5%
Capital Expenditures 3.4 3.5 -2.9% 7.2 5.2 38.5%
Energy Systems
Orders $ 332.8 $ 749.6 -55.6% $ 701.1 $1,042.8 -32.8%
Backlog 2,615.4 2,934.1 -10.9% 2,615.4 2,934.1 -10.9%
Sales 323.9 307.1 5.5% 559.9 621.7 -9.9%
Operating Profit (Loss) 16.6 14.8 12.2% 8.3 61.6 -86.5%
Operating Profit Margin 5.1% 4.8% N/A 1.5% 9.9% N/A
D&A 12.8 13.7 -6.6% 26.4 27.7 -4.7%
Capital Expenditures 7.7 8.6 -10.5% 14.9 13.7 8.8
Power Generation
Orders $ 657.4 $ 403.8 62.8% $1,120.6 $ 951.0 17.8%
Backlog 2,436.4 2,162.2 12.7% 2,436.4 2,162.2 12.7%
Sales 395.1 422.9 -6.6% 686.7 811.8 -15.4%
Operating Profit (Loss) 3.7 30.2 -87.7% (22.2) 7.1 -412.7%
Operating Profit Margin 0.9% 7.1% N/A -3.2% 0.9% N/A
D&A 11.9 11.8 0.8% 23.8 24.1 -1.2%
Capital Expenditures 7.1 6.1 16.4% 14.9 9.7 53.6%
Knoll
Orders $ 144.3 $ 122.7 17.6% $ 261.6 $ 239.8 9.1%
Backlog 105.9 93.9 12.8% 105.9 93.9 12.8%
Sales 143.7 126.9 13.2% 261.2 246.1 6.1%
Operating Profit (Loss) (9.7) (6.7) -44.8% (24.7) (16.9) -46.2%
Operating Profit Margin -6.8% -5.3% N/A -9.5% -6.9% N/A
D&A 7.1 8.4 -15.5% 14.4 16.1 -10.6%
Capital Expenditures 3.4 4.1 -17.1% 4.6 6.9 -33.3%
WCI
Orders $ 74.0 $ 48.8 51.6% $ 130.2 $ 92.7 40.5%
Backlog - - - - - -
Sales 74.0 48.8 51.6% 130.2 92.7 40.5%
Operating Profit (Loss) 24.3 13.6 78.7% 37.2 24.4 52.5%
Operating Profit Margin 32.8% 27.9% N/A 28.6% 26.3% N/A
D&A 0.5 0.3 66.7% 0.9 0.7 28.6%
Capital Expenditures 1.3 0.1 1200.0% 1.5 0.4 275.0%
</TABLE>
-22-
<PAGE> 23
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1994 1993 % Change 1994 1993 % Change
---- ---- -------- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C>
Other Businesses
Orders $ 84.2 $ 137.7 -38.9% $ 212.5 $ 269.8 -21.2%
Backlog 691.5 808.3 -14.5% 691.5 808.3 -14.5%
Sales 130.7 134.0 -2.5% 261.2 263.8 -1.0%
Operating Profit (Loss) (9.2) (8.6) N/A (22.3) (10.2) N/A
Operating Profit Margin -7.0% -6.4% N/A -8.5% -3.9% N/A
D&A 3.0 3.3 -9.1% 6.5 6.9 -5.8%
Capital Expenditures 0.6 3.6 -83.3% 1.3 5.3 -75.5%
Corporate and Other
Orders $ 15.8 $ 29.2 -45.9% $ 41.2 $ 47.7 -13.6%
Backlog 65.3 56.7 15.2% 65.3 56.7 15.2%
Sales 39.0 39.7 -1.8% 73.5 73.3 0.3%
Operating Profit (Loss) (5.3) (10.4) N/A (0.4) (10.7) N/A
Operating Profit Margin -13.6% -26.2% N/A -0.5% -14.6% N/A
D&A 8.5 (1.5) N/A 16.2 10.2 58.8%
Capital Expenditures 5.6 2.9 93.1% 5.8 4.7 23.4%
Intersegment
Orders $ (40.8) $ (42.8) 4.7% $ (78.8) $ (83.0) 5.1%
Backlog (35.7) (22.5) -58.7% (35.7) (22.5) -58.7%
Sales (39.5) (37.8) -4.5% (74.1) (74.1) 0.0%
Total - Continuing Operations
Orders $ 2,344.2 $2,283.1 2.7% $ 4,357.9 $4,488.4 -2.9%
Backlog 10,134.9 9,938.9 2.0% 10,134.9 9,938.9 2.0%
Sales 2,108.4 2,154.4 -2.1% 3,851.1 4,173.9 -7.7%
Operating Profit (Loss) 153.5 184.9 -17.0% 218.9 331.2 -33.9%
Operating Profit Margin 7.3% 8.6% N/A 5.7% 7.9% N/A
D&A 81.3 71.6 13.5% 162.8 157.3 3.5%
Capital Expenditures 56.5 48.0 17.7% 91.6 81.0 13.1%
</TABLE>
Broadcasting
Westinghouse Broadcasting Company (Group W) and CBS, Inc. (CBS) announced
agreement to enter into a comprehensive strategic partnership which would
establish long-term station affiliations between CBS and all of Group W's
television stations; form new, jointly-held entities that will expand both
companies' distribution and programming capabilities nationwide; and merge
their advertising sales representation operations. The agreement is subject
to the execution of definitive documentation.
Broadcasting's sales and operating profit were up $10 million and $8
million, respectively, for the second quarter of 1994, and $21 million and
$15 million, respectively, for the first half of 1994 compared to the same
periods of 1993. Television benefitted from an overall strengthening of
advertising demand, improved ratings at three stations, revenues from the
Winter Olympics and continued productivity improvements. Radio's sales
were
- 23 -
<PAGE> 24
down slightly for both periods due to the timing of station acquisitions and
divestitures. Operating profit for radio was up substantially as "same
station" revenues were up and cost reductions continued to benefit
performance. Westinghouse Communications also continued to show growth in
sales and operating profit.
Electronic Systems
Orders for Electronic Systems were up $154 million for the second quarter of
1994 compared to 1993 primarily due to 1994 funding for the F-16 program.
Orders were down $87 million for the first half of 1994 compared to the first
half of 1993 as the F-16 order was offset by the inclusion in 1993 of a $240
million order for an international defense system. Backlog at June 30, 1994
was up $227 million compared to quarter-end 1993 primarily due to the
addition of the Norden backlog of $198 million.
Sales and operating profit for Electronic Systems declined $136 million and
$28 million, respectively, for the second quarter of 1994 and $282 million
and $41 million, respectively, for the first half of 1994 compared to the
same periods of 1993. The decreases were due to lower Department of Defense
(DoD) sales including declining production on torpedo programs, and increased
pension expense partially offset by improved margins and cost reductions.
The first half of 1993 also benefitted from revenues related to the
cancellation of the Airborne Self-Protection Jammer program.
The Corporation completed the acquisition of the Norden unit of United
Technologies Corporation in May 1994. Norden manufactures airborne and
shipboard radar systems, air traffic control systems, and surveillance and
intelligence management systems for underseas applications.
Electronic Systems business is influenced by changes in the budgetary plans
and procurement policies of the U.S. government. Reductions in defense
spending and program cancellations in recent years have adversely affected
and are likely to continue to adversely affect the results of this segment.
DoD revenues are expected to be lower in 1994 than in 1993.
Government and Environmental Services
Orders for Government and Environmental Services were up $13 million in the
second quarter of 1994 and $17 million for the first half of 1994 compared to
the same periods of 1993 due to order increases in waste processing,
incineration and remediation. Backlog was up $45 million compared to the end
of the second quarter of 1993 mainly due to the addition to the backlog in
the second half of 1993 of a $40 million order for special material handling
containers which will be liquidated over the next several years and
additional remediation orders through 1994 and the second half of 1993.
Sales were up $18 million for the second quarter and $25 million for the
first half of 1994 compared with the same periods last year primarily due to
higher waste processing and remediation sales. Operating profit was down
$2 million and $12 million for the respective periods primarily due to lower
margins in remediation services and waste processing which was partially
offset by the higher volume.
- 24 -
<PAGE> 25
As part of its contract reform initiative, the Department of Energy (DoE) has
announced that it intends to change its practice from typically extending the
maintenance and operation (M&O) contracts, to one of seeking competitive bids
as contracts expire. This may affect the Corporation's existing contracts as
the DoE has announced that it will competitively bid the Savannah River
contract which was extended for two consecutive one-year periods from its
original expiration date of September 30, 1994 to September 30, 1996, and the
Hanford contract which was extended for only one year to March 31, 1997.
Management believes that the Corporation's past performance will make it a
strong competitor for a significant portion of these contracts.
Thermo King
Orders for Thermo King were up $66 million and $91 million for the second
quarter and first half of 1994, respectively, compared to the same periods in
1993. Backlog was up $78 million at June 30, 1994 compared to the 1993
quarter-end. Orders and backlog are both at record levels.
Sales and operating profit were up $37 million and $3 million, respectively,
for the second quarter of 1994, and $49 million and $5 million, respectively,
for the first half of 1994 compared to the same periods in 1993. These
increases were due to continuing strength in North American trailer
refrigeration fueled by the economic recovery and a surge in replacements
after a period of market stagnation. In addition, penetration of the
seagoing container market and slight market recovery in Europe contributed to
the growth.
Energy Systems
Orders for Energy Systems were down $417 million and $342 million for the
second quarter and first half of 1994, respectively, compared to the same
periods in 1993. Backlog was down $319 million at June 30, 1994 compared to
the 1993 quarter-end. The second quarter of 1993 included an order for $440
million for fuel and control systems at the Temelin plant in the Czech
Republic.
Sales and operating profit were up $17 million and $2 million, respectively,
for the second quarter of 1994 compared to the second quarter of 1993
primarily due to revenues from Temelin control systems. Sales and operating
profit were down $62 million and $53 million, respectively, for the first
half of 1994 compared to the same period last year primarily due to decreased
licensee income, increased pension expense and the favorable effect of a
change in accounting for nuclear fuel revenues in 1993.
Power Generation
Orders for Power Generation were up $254 million and $170 million for the
second quarter and first half of 1994, respectively, compared to the same
periods of 1993. Backlog was up $274 million at June 30, 1994 compared to
the 1993 quarter-end. The increases were primarily in projects and long-term
parts and service maintenance orders.
- 25 -
<PAGE> 26
Sales for the second quarter and first half of 1994 were down $28 million and
$125 million, respectively, compared to the same periods of 1993 primarily
due to lower sales in the projects division. Operating profit was down for
the second quarter and first half of 1994 compared to the same periods in
1993 by $27 million and $29 million, respectively, primarily due to an
unfavorable mix of sales and increased pension expense partially offset by
cost reductions.
Knoll
Orders for Knoll were up $22 million for both the second quarter and first
half of 1994 compared to the 1993 periods and backlog was up $12 million at
June 30, 1994 compared to the 1993 quarter-end due to strong order rates in
North America.
Sales were up $17 million and $15 million for the second quarter and first
half of 1994, respectively, compared to the same periods in 1993 due to
increased participation in the growing North American market partially offset
by continued declines in Europe. Operating losses increased by $3 million
and $8 million, respectively, for the same periods as the volume improvement
and cost reductions were more than offset by an unfavorable sales mix, price
deterioration and the cost of a 1994 second quarter reduction-in-force.
WCI
WCI's sales and operating profit were up $25 million and $11 million,
respectively, for the second quarter of 1994, and $38 million and $13
million, respectively, for the first half of 1994 compared to the same
periods of 1993 primarily due to the continued strong South Florida market.
Cash flow from operating activities for WCI for the first six months of 1994
totalled $54 million.
Other Businesses
Orders for Other Businesses were down $54 million and $57 million for the
second quarter and first half of 1994, respectively, compared to the same
periods of 1993, and backlog was down $117 million at June 30, 1994 compared
to the 1993 quarter-end.
Sales were down $3 million for both the second quarter and first half of 1994
compared to the same periods in 1993 as the Controlmatic divestiture and
lower sales at Resource Energy Systems were primarily offset by increases in
the Industrial Products and Services business unit. Operating losses
increased by $1 million and $12 million for the respective periods due to
lower volumes, lower margins and an unfavorable sales mix.
In May 1994, the Corporation completed the sale of Controlmatic.
- 26 -
<PAGE> 27
LIQUIDITY AND CAPITAL RESOURCES
Overview
- --------
During the first half of 1994, the Corporation's liquidity has improved
through the disposition of Financial Services assets, the sales of DCBU and
WESCO, and a preferred stock offering. Management believes that the net
proceeds anticipated from the continued disposition of assets of Discontinued
Operations and certain non-strategic businesses, as well as cash flow from
the operating activities of Discontinued Operations and the cash flow from
WCI, will be sufficient to fund Discontinued Operations, including the
repayment of its debt.
Also improving liquidity, on August 5, 1994 the Corporation entered into two
new revolving credit agreements with a combined commitment level of
$2.5 billion. Other sources of liquidity generally available to the
Corporation include cash and cash equivalents, cash flow from operations and
borrowings from other sources, including funds from the capital markets,
subject to then existing market conditions and other considerations.
Significant progress was made during the first half of 1994 in reducing the
Corporation's net debt (total debt less cash and cash equivalents). Net debt
at June 30, 1994 totalled $3,338 million, a reduction of $1,764 million from
$5,102 million at December 31, 1993. The principal sources of cash for this
reduction were the sales of DCBU and WESCO with cash proceeds of
approximately $1.4 billion, the issuance of the C Preferred with net proceeds
of $505 million, and the sale of Financial Services assets during the first
half of 1994 for approximately $177 million.
The Corporation completed the sale of DCBU, excluding its Australian
subsidiary, to Eaton Corporation on January 31, 1994, for a purchase price of
$1.1 billion and the assumption by the buyer of certain liabilities. The
Corporation completed the sale of the Australian subsidiary in March 1994.
The Corporation completed the sale of WESCO on February 28, 1994 to an
affiliate of Clayton, Dubilier & Rice, Inc., a private investment firm, for
approximately $340 million. The proceeds of approximately $340 million were
comprised of approximately $275 million in cash, approximately $50 million in
first mortgage notes and the remainder in stock and options in the new
company.
During March 1994, the Corporation sold, in a private placement pursuant to
Rule 144A of the Securities Act of 1933, 36,000,000 depositary shares,
representing 3,600,000 shares of C Preferred. Each depositary share will
automatically convert into one share of common stock on June 1, 1997, unless
called on May 30, 1997 by the Corporation or redeemed at any time prior to
June 1 by the holder. If called by the Corporation, each depositary share
will convert into common stock at a rate between .885 and 1 share. If
redeemed by the holder, each depositary share will convert into .885 of a
share of common stock. The stock carries an annual dividend of $1.30 per
depositary share or $13.00 per C Preferred payable on the same quarterly
schedule as the Corporation's common stock dividend. Dividends are
cumulative and must be declared by the Board of Directors to be payable. Net
proceeds from the offering totalled $505 million and were used to reduce
short-term debt.
- 27 -
<PAGE> 28
On August 26, 1992, Westinghouse filed a registration statement on Form S-3
for the issuance of up to $1 billion of Westinghouse debt securities. At
June 30, 1994, $400 million of this shelf registration was unused.
Prior to the adoption of the Plan, Financial Services entered into interest
rate and currency exchange agreements to manage the interest rate and
currency risk associated with various debt instruments. No transactions were
speculative in nature or leveraged. Given their nature, these agreements
have been accounted for as hedging transactions. At June 30, 1994, the
notional amount of interest rate and currency exchange agreements outstanding
totalled approximately $910 million with an average remaining maturity of 1.5
years.
The Corporation's foreign exchange exposure policy includes selling in
national currencies where possible, and hedging those transactions in
excess of $250,000 occurring in currencies other than those of the
originating country. In addition, the Corporation's accounting policies
require translation of local currency financial statements of subsidiaries
in highly inflationary and unstable economies into U.S. dollars in accordance
with SFAS No. 52, "Foreign Currency Translation," in order to minimize
foreign exchange rate risks and provide for appropriate accounting treatment
where exchange rates are most volatile.
With respect to the Corporation's operations in highly inflationary and
unstable economies that are accounted for in accordance with SFAS No. 52, the
combined total sales for those operations were less than 0.5% of the
Corporation's sales for the first six months of 1994. Any translation
adjustments resulting from converting the local currency balance sheets
and income statements of designated hyperinflationary subsidiaries into U.S.
dollars are recorded as period costs in accordance with SFAS No. 52.
Revolving Credit Facilities
- ---------------------------
On August 5, 1994, the Corporation entered into two revolving credit
agreements with a syndicate of domestic and international banks. The two new
revolvers have a combined commitment level of $2.5 billion, with $2.0 billion
from a revolver which expires on August 4, 1997 (three-year revolver) and
$500 million from a revolver which expires on August 4, 1995 (364-day
revolver). On August 5, 1994, contemporaneous with entering into the new
revolvers, the Corporation repaid all borrowings under the December 1991
revolver, totalling $800 million, with proceeds from the three-year revolver.
Total borrowings under these facilities totalled $800 million at August 5,
1994.
Similar to the prior revolver, availability under the new revolvers is
subject to the maintenance of certain financial ratios and compliance with
other covenants and subject to there being no material adverse change with
respect to the Corporation taken as a whole. The covenants under the new
revolvers place restrictions on the incurrence of liens and establishes a
maximum leverage ratio, minimum interest coverage ratio and minimum
consolidated net worth. Certain of these covenants become more restrictive
over the terms of the new revolvers. See Financing Activities for a
discussion of interest costs and fees related to the new revolvers.
- 28 -
<PAGE> 29
During the first half of 1994, the Corporation made net repayments of
borrowings under the then existing revolver of $2,105 million. The primary
sources of cash for these repayments were the total cash proceeds of
approximately $1.4 billion received from the sales of DCBU and WESCO, the
$505 million of net cash proceeds from the issuance of the Corporation's C
Preferred in March 1994, and approximately $177 million of proceeds from the
sale of Financial Services assets. Of the $2,105 million of net repayments
during the first half of 1994, $1,605 million related to Discontinued
Operations and $500 million related to Continuing Operations. At June 30,
1994, there were no borrowings under the revolver related to Continuing
Operations.
Operating Activities
- --------------------
Cash provided by operating activities of Continuing Operations was $4 million
for the first half of 1994, a decrease of $69 million from the amount
provided in the same period in 1993.
Cash used by operating activities of Discontinued Operations was $175 million
for the first half of 1994, an increased use of $29 million from the amount
used in the first half of 1993.
Investing Activities
- --------------------
Investing activities of Continuing Operations used $124 million of cash in
the first half of 1994, compared to $81 million of cash used in the same
period in 1993. The principal source of this change during the first half of
1994 was the acquisition of Norden in May 1994, partially offset by the sale
of two radio stations in January 1994.
Investing activities of Discontinued Operations provided $1,578 million of
cash during the first half of 1994 compared to $2,305 million of cash
provided for the same period in 1993. The primary reasons for this decrease
in cash provided by the investing activities of Discontinued Operations was
the decrease in the level of sales of portfolio investments partially offset
by the sales of DCBU and WESCO during the first half of 1994. See Overview
above.
Financing Activities
- --------------------
Total debt of the Corporation was $3,770 million at June 30, 1994, a
decrease of $2,580 million from $6,350 million at December 31, 1993. Cash and
cash equivalents of the Corporation were $432 million at June 30, 1994, a
decrease of $816 million from $1,248 million at December 31, 1993.
Short-term debt, including current maturities of long-term debt, of the
Corporation totalled $1,130 million at June 30, 1994 compared to $3,818
million at December 31, 1993. This decrease is primarily attributable to net
repayments of $2,105 million of prior revolver borrowings during the first
half of 1994.
- 29 -
<PAGE> 30
Short-term debt, including current maturities of long-term debt, of
Continuing Operations was $120 million at June 30, 1994 compared to
$671 million at December 31, 1993. This decrease is primarily attributed to
the repayment of $500 million of revolver borrowings from the proceeds of
the C Preferred offering.
Short-term debt, including current maturities of long-term debt, of
Discontinued Operations totalled $1,010 million at June 30, 1994 compared to
$3,147 million at December 31, 1993, a decrease of $2,137 million. The
$2,137 million decrease is primarily attributed to the use of $605 million of
Discontinued Operations cash and cash equivalents and net repayments of
$1,605 million of revolver borrowings, primarily from the sale proceeds of
DCBU and WESCO and proceeds from the sale of Financial Services assets during
the first half of 1994.
Total borrowings outstanding under the prior revolver were $750 million at
June 30, 1994 (excluding $76 million of letters of credit), all of which were
attributable to Discontinued Operations. These borrowings carried a composite
interest rate of 5.0%. The Corporation's interest rate margin increased
.125% upon Moody's downgrade on January 7, 1994. The downgrade by Fitch on
January 11, 1994 had no effect on the margin.
Borrowings under the prior revolver were also subject to utilization and
facility fees. The utilization fee decreased from .125% to .0% as a result
of average revolver borrowings and outstanding letters of credit going below
$2,000 million during the first half of 1994. The facility fee, also based
on the Corporation's debt ratings and interest coverage ratio, increased
.125% to .50% per annum upon the Standard and Poor's downgrade on March 9,
1993.
The interest rates for borrowings under the new revolvers are based on the
London Interbank Offer Rate (LIBOR) plus an interest rate margin based on the
Corporation's long-term debt ratings. An increase in LIBOR or certain
decreases in the Corporation's long-term debt ratings will result in higher
interest expense to the Corporation. Borrowings under the 364-day revolver
are subject to a higher interest rate spread than borrowings under the three-
year revolver. The new revolvers also include facility fees based on
revolver commitment level, whether used or unused. The facility fee
percentages under the 364-day revolver are lower than under the three-year
revolver. Certain decreases in the Corporation's long-term debt ratings will
result in higher facility fees to the Corporation.
Long-term debt of the Corporation totalled $2,640 million at June 30, 1994, a
$108 million increase from December 31, 1993. Long-term debt of Continuing
Operations was $1,881 million at June 30, 1994 compared to $1,885 million at
December 31, 1993. Long-term debt of Discontinued Operations was $759 million
at June 30, 1994 compared to $647 million at December 31, 1993. The increase
in long-term debt of Discontinued Operations is primarily due to the
reclassification of $150 million of 8-7/8% senior notes due 2014 from current
maturities of long-term debt at December 31, 1993, to long-term debt at June
30, 1994, as the noteholders' thirty day right to request redemption period
expired on May 14, 1994 without such request being made. The next right to
request redemption period is the thirty days ending May 14, 1999.
- 30 -
<PAGE> 31
Long-term debt includes a 15 billion Japanese yen bond issued in 1990
which was converted into a $74 million U.S. dollar borrowing through an
interest rate and currency swap. Due to the appreciation of the yen versus the
dollar since 1990, as of June 30, 1994, the U.S. dollar equivalent of this yen
bond had increased by $83 million to approximately $157 million. This increase
was fully offset by an $83 million increase in the value of the interest rate
and currency swap. The Corporation has recorded the net liability from the
Japanese yen bond and interest rate and currency swap of $74 million in
long-term debt of Discontinued Operations.
The Corporation's net debt-to-capital ratio for Continuing Operations was
49% at June 30, 1994 compared to 65% at December 31, 1993.
OTHER MATTERS
Pensions
- --------
In connection with the recent downsizing by the Corporation, increased
lump sum cash withdrawals from the fund have caused management to review plan
contributions. Management currently anticipates that it will contribute
approximately $250 million to $300 million in a combination of cash or stock
during 1994, of which $75 million in cash has been contributed to date.
Contributions are expected to be at approximately the same level in 1995.
Management is considering modifications to the current pension plan with the
intention of minimizing any potential future increases in pension expense.
Actual funding levels and pension expense for 1995 will be dependent upon any
modification of the terms or assumptions of the plan.
- 31 -
<PAGE> 32
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
(a) On December 1, 1988, the Republic of the Philippines (Republic) and
National Power Corporation (NPC) filed a 15 count lawsuit in the
United States District Court (USDC) for the District of New Jersey
asserting claims against the Corporation, Westinghouse International
Projects Company and Burns and Roe Enterprises, Inc. (Burns and Roe)
relating to the construction of a nuclear power plant in the
Philippines, as well as an earlier consulting contract between NPC
and Burns and Roe relating to the same project. This action seeks
rescission of the Westinghouse and Burns and Roe contracts and
restitution of all money and other property paid to Westinghouse and
Burns and Roe or, alternatively, reformation of the NPC-Westinghouse
contract. Plaintiffs requested compensatory, punitive and treble
damages, costs and expenses of the lawsuit, and such other relief as
the USDC deems just and proper. The complaint alleges, among other
things, bribery and other fraudulent conduct, tortious interference
with the fiduciary duty owed by Ferdinand E. Marcos to the Republic
and the people of the Philippines, common law fraud, and violations
of various New Jersey and federal statutes including the Federal
Racketeer Influenced and Corrupt Organizations Act (RICO) statute.
Plaintiffs demanded a jury trial.
Also on December 1, 1988, Westinghouse filed a request for
arbitration with the International Chamber of Commerce Court of
Arbitration (ICC) pursuant to the NPC-Westinghouse contract, setting
forth certain claims Westinghouse has against NPC and the Republic
and asking for arbitration of the anticipated claims of the Republic
and NPC related to construction of the Philippines nuclear power
plant. The Republic and NPC challenged the jurisdiction of the ICC,
arguing that the contract between the parties, including its
arbitration provision, was invalid due to alleged bribery in the
procurement of the contract. In December 1991, the ICC arbitration
panel issued its award finding that the Republic and NPC had failed
to carry their burden of proving the alleged bribery by the
Corporation. The panel thereby concluded that the arbitration clause
and contract were valid and that the panel has jurisdiction over the
remaining disputes between NPC and the Corporation. In January 1992,
NPC filed an action for annulment of the award by the ICC arbitration
panel in the Swiss Federal Supreme Court. In September 1993, the
Swiss Federal Supreme Court issued an order dismissing NPC's
annulment action and assessing cost against NPC. Evidentiary
hearings before the ICC began in the first quarter of 1994 and
continued on June 13, 14 and 15, when they were concluded. Final
argument will take place in October of this year, and the final award
will be issued some time thereafter.
With respect to the suit filed in the USDC, Westinghouse filed a
motion requesting that the action filed there be stayed in its
entirety pending arbitration of the Republic's claim. In 1989, the
Court granted a motion brought by the Corporation and ordered 14 of
the 15 counts in the lawsuit stayed pending arbitration. The Court
retained jurisdiction over the remaining count involving an alleged
intentional interference with a fiduciary relationship. Trial
commenced with respect to this one count in March 1993. In
- 32 -
<PAGE> 33
May 1993, a jury verdict was rendered in favor of the Corporation
with respect to all claims relating to the alleged intentional
interference with a fiduciary relationship. NPC and the Republic
have indicated that they intend to appeal this decision.
(b) In April 1991, Duquesne Light Company (Duquesne) and its co-owners
filed a law suit against the Corporation in the USDC for the Western
District of Pennsylvania for an undetermined amount of damages,
including treble and punitive damages. Subsequently, Duquesne
disclosed that it is seeking approximately $269 million to $320
million for estimated past and future damages sustained by two
nuclear steam supply systems furnished by the Corporation for
Duquesne's Beaver Valley, Pennsylvania plants. The Corporation has
moved for summary judgment, and the magistrate has recommended that
Duquesne's negligent misrepresentation claim and a RICO claim be
dismissed. Duquesne and the Corporation have objected to various
recommendations of the magistrate with respect to those and other
claims of breach of contract, fraud and RICO violations. The judge
is expected to rule on the recommendations in August, and unless the
Corporation's motion is granted in its entirety, the case will
proceed to trial.
(c) On November 4, 1993, the Wisconsin Department of Natural Resources
(DNR) issued a notice of violation to the Corporation alleging that it
violated the Wisconsin Hazardous Waste Management Act by failing, with
respect to its former Milwaukee repair facility, to notify the
Department of the presence of PCBs and for failing to remediate the
PCBs at the facility. The matter was referred to the Wisconsin
Department of Justice (DOJ). The DOJ is currently proposing a total of
$150,000 in fines and assessments for these violations. The
Corporation is negotiating with the DOJ on the alleged violations.
(d) The Corporation is a defendant in 32 asbestos cases and a third-party
defendant in 2,200 other cases that are part of consolidated
litigation pending in Baltimore County Circuit Court. The plaintiffs
have claimed damages for personal injury, wrongful death and loss of
consortium arising from exposure to asbestos-containing products
manufactured, supplied or installed by various defendants, including
the Corporation. Trial commenced on June 20, 1994, with respect to
six representative plaintiffs, none of whom have claims against the
Corporation. The product defect and punitive damages issues resolved
in the trial will be binding upon the Corporation in subsequent
trials of the remaining plaintiffs' claims subject to appeal. The
Corporation has notified its liability carriers of these claims.
(e) In January 1992, a suit was filed against Westinghouse Credit
Corporation (WCC) in the Circuit Court of Jackson County, Missouri by
three affiliated entities (collectively American Carriers) for the
alleged breach of a commitment letter issued by WCC to lend up to
$65 million. American Carriers claimed that the failure to make the
loan caused American Carriers to file for bankruptcy protection. In
February 1993, the jury returned a verdict in favor of American
Carriers in the amount of $70 million. The Corporation appealed,
and on July 12, 1994, the Missouri Court of Appeals affirmed the
judgment entered by the Circuit Court on the jury verdict. The
Corporation has moved for a rehearing before the entire panel of
the Circuit Court. The Corporation previously established a reserve
which it believes is sufficient to cover the potential settlement of
this claim.
- 33 -
<PAGE> 34
(f) The Corporation was a defendant in approximately 7,400 out of more
than 12,000 asbestos cases pending in the Circuit Court of Kanawha
County, West Virginia. The plaintiffs alleged personal injury,
wrongful death and loss of consortium claims arising out of alleged
exposure to asbestos-containing products that were manufactured,
supplied or installed by the defendants, including the Corporation.
On April 11, 1994, the Corporation entered into a settlement with
respect to all cases pending in Kanawha County. The effect of this
settlement on the Corporation will not be material.
Management believes that the Corporation has meritorious defenses to the
proceedings described in items (a) through (e) above.
ITEM 4. Submission of Matters to a Vote of Security Holders
(a) The annual meeting of shareholders of the Corporation was held
on April 27, 1994.
(b) The following matters were submitted to a vote of the shareholders
at the annual meeting:
(i) In connection with the election of eight directors, the
following votes were cast for or withheld from the
following candidates:
<TABLE>
<CAPTION>
FOR WITHHELD
<S> <C> <C>
Frank C. Carlucci 262,234,541 9,500,318
Gary M. Clark 262,937,975 8,796,884
George H. Conrades 263,069,295 8,665,563
William H. Gray III 262,343,700 9,391,159
Michael H. Jordan 262,840,226 8,894,633
David T. McLaughlin 262,274,750 9,460,108
Richard R. Pivirotto 262,095,053 9,639,806
Paula Stern 262,603,733 9,131,125
</TABLE>
(ii) A management proposal regarding the election of Price
Waterhouse as independent accountants was presented at
the meeting and 263,413,301 shares of common stock were
voted for, 6,278,705 shares were voted against, and
2,042,852 shares abstained in connection with the
adoption of this resolution, the text of which is set
forth on pages 35 and 36 of the Corporation's Proxy
Statement dated March 11, 1994, and incorporated herein
by reference.
(iii) A management proposal concerning approval of the
Corporation's 1993 Long-Term Incentive Plan was
presented at the meeting, and 142,452,924 shares of
common stock were voted for, 58,861,546 shares were
voted against, 4,428,800 shares abstained, and there
were 65,991,588 broker non-votes in connection with the
adoption of the 1993 Long-Term Incentive Plan, the text
of which is set forth on pages 36 through 43 of the
Corporation's Proxy Statement dated March 11, 1994 and
incorporated herein by reference.
- 34 -
<PAGE> 35
(iv) A Board resolution concerning approval of an amendment
to the Corporation's Restated Articles of Incorporation
to increase the number of authorized common shares was
presented at the meeting, and 245,060,862 shares of
common stock were voted for, 22,238,948 shares were
voted against, 3,746,854 shares abstained, and there
were 688,195 broker non-votes in connection with this
resolution, the text of which is set forth on page 43
of the Corporation's Proxy Statement dated March 11,
1994, and incorporated herein by reference.
(v) A shareholder's resolution requesting that the
Corporation endorse the CERES Principles for corporate
environmental accountability was presented at the
meeting and 41,913,822 shares of common stock were
voted for, 141,837,901 shares were voted against,
21,645,775 shares abstained and there were 66,337,360
broker non-votes in connection with this resolution,
the text of which is set forth on pages 44 and 45 of
the Corporation's Proxy Statement dated March 11, 1994,
and incorporated herein by reference.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) EXHIBITS
(4) RIGHTS OF SECURITY HOLDERS
(a) The Corporation agrees to provide to the Securities and
Exchange Commission, upon request, a copy of instruments
defining the rights of holders of long-term debt of the
Corporation and its consolidated subsidiaries.
(10) MATERIAL CONTRACTS
(a) The Annual Performance Plan is incorporated herein by
reference to Exhibit 10(a) to Form 10-K/A for the year
ended December 31, 1992.
(b) The 1993 Long-Term Incentive Plan is incorporated herein
by reference to Exhibit A to the Corporation's Notice of
1994 Annual Meeting and Proxy Statement filed with the
Commission pursuant to Schedule 14A of the Exchange Act.
(c) The 1984 Long-Term Incentive Plan, as amended, is
incorporated herein by reference to Exhibit 10(b) to Form
10-Q for the quarter ended June 30, 1993.
(d) The 1979 Stock Option and Long-Term Incentive Plan is
incorporated herein by reference to Exhibit 10(c) to Form
10-K/A for the year ended December 31, 1992.
(e) The Westinghouse Employee Stock Purchase Plan is
incorporated herein by reference to Exhibit 10(d) to Form
10-K, as amended, for the year ended December 31, 1991.
(f) The Westinghouse Personal Investment Plan is incorporated
herein by reference to Exhibit 10(e) to Form 10-K/A for
the year ended December 31, 1992.
- 35 -
<PAGE> 36
(g) The Westinghouse Executive Pension Plan, as amended, is
incorporated herein by reference to Exhibit 10(f) to Form
10-Q for the quarter ended June 30, 1993.
(h) The Deferred Stock and Compensation Plan for Directors is
incorporated herein by reference to Exhibit 10(i) to
Form 10-K/A for the year ended December 31, 1992.
(i) The Advisory Director's Plan is incorporated herein by
reference to Exhibit 10(k) to Form 10-K for the year ended
December 31, 1989.
(j) Competitive Advance and Revolving Credit Facility dated as of
December 23, 1991, among the Corporation and WCC as borrowers,
the Co-Agents and Lenders named therein and Chemical Bank as
Administrative Agent, is incorporated herein by reference to
Exhibit 10 to the Corporation's Form 8-K dated January 31,
1992.
(k) First Amendment dated as of September 30, 1992 to the
Competitive Advance and Revolving Credit Facility is
incorporated herein by reference to Exhibit 10(1) to Form
10-K/A for the year ended December 31, 1992.
(l) Second Amendment dated as of April 2, 1993 to the Competitive
Advance and Revolving Credit Facility is incorporated herein by
reference to Exhibit 10(m) to Form 10-Q/A for the quarter ended
March 31, 1993.
(m) The 1991 Long-Term Incentive Plan, as amended, effective
December 31, 1993, is incorporated herein by reference to
Exhibit 10(o) to Form 10-K for the year ended December 31,
1993.
(n) Amended and Restated Competitive Advance and Revolving Credit
Facility Agreement effective as of May 3, 1993 among the
Corporation as borrower, the Co-Agents and Lenders named
therein, and Chemical Bank as Administrative Agent is
incorporated herein by reference to Exhibit 10(t) to Form 10-Q
for the quarter ended June 30, 1993.
(o) First Amendment to the Amended and Restated Competitive Advance
and Revolving Credit Facility Agreement dated as of June 9,
1993 among the Corporation as borrower, the Co-Agents and
Lenders named therein, and Chemical Bank as Administrative
Agent is incorporated herein by reference to Exhibit 10(u) to
Form 10-Q for the quarter ended June 30, 1993.
(p) Employment Agreement between the Corporation and
Michael H. Jordan is incorporated herein by reference to
Exhibit 10 to the Corporation's Form 8-K, dated
September 1, 1993.
(q) Second Amendment to the Amended and Restated Competitive
Advance and Revolving Credit Facility Agreement dated as of
December 1, 1993 among the Corporation as borrower, the Co-
Agents and lenders named therein, and Chemical Bank as
Administrative Agent is incorporated herein by reference to
Exhibit 10(t) to Form 10-K for the year ended December 31,
1993.
(r) 364-Day Competitive Advance and Revolving Credit Facility
Agreement dated as of August 5, 1994 among the Corporation as
borrower, The Co-Agents and Lenders named therein, and Chemical
Bank as Administrative Agent.
- 36 -
<PAGE> 37
(s) Three year Competitive Advance and Revolving Credit Facility
Agreement dated as of August 5, 1994 among the Corporation as
borrower, the Co-Agents and Lenders named therein, and Chemical
Bank as Administrative Agent.
(11) COMPUTATION OF PER SHARE EARNINGS
(12a) COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(12b) COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS
b) REPORTS ON FORM 8-K:
A Current Report on Form 8-K (Items 5 and 7) dated April 22, 1994 to
report first quarter results and 1993 quarterly segment financial
information based on redefined segments for financial reporting
purposes.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on the 15th day of August 1994.
WESTINGHOUSE ELECTRIC CORPORATION
Robert E. Faust
-----------------------------
Vice President and
Chief Accounting Officer
- 37 -
<PAGE> 38
<TABLE>
EXHIBIT INDEX
<CAPTION>
Exhibits
<C> <S> <C>
(4) Rights of Security Holders
(a) The Corporation agrees to provide to the Securities
and Exchange Commission, upon request, a copy of
instruments defining the rights of holders of long-term
debt of the Corporation and its consolidated
subsidiaries. NA
(10) Material Contracts
(a) The Annual Performance Plan *
(b) The 1993 Long-Term Incentive Plan *
(c) The 1984 Long-Term Incentive Plan *
(d) The 1979 Stock Option and Long-Term Incentive Plan *
(e) The Westinghouse Employee Stock Purchase Plan *
(f) The Westinghouse Personal Investment Plan *
(g) The Westinghouse Executive Pension Plan *
(h) The Deferred Stock and Compensation Plan for Directors *
(i) The Advisory Director's Plan *
(j) Competitive Advance and Revolving Credit Facility *
(k) Amendment to the Competitive Advance and Revolving
Credit Facility *
(l) Second Amendment to the Competitive Advance and
Revolving Credit Facility *
(m) The 1991 Long-Term Incentive Plan *
(n) Amended and Restated Competitive Advance and Revolving
Credit Facility *
(o) First Amendment to the Amended and Restated Competitive
Advance and Revolving Credit Facility *
(p) Employment Agreement with Michael H. Jordan *
(q) Second Amendment to the Amended and Restated
Competitive Advance and Revolving Credit Facility *
(r) 364-Day Competitive Advance and Revolving
Credit Facility
(s) Three Year Competitive Advance and Revolving
Credit Facility
(11) Computation of Per Share Earnings
(12) Computation of Ratios
(a) Ratio of Earnings to Fixed Charges
(b) Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends
<FN>
*Incorporated by reference
</TABLE>
<PAGE> 1
Exhibit 10(r)
________________________________________________________________________________
________________________________________________________________________________
364-DAY COMPETITIVE ADVANCE
AND REVOLVING CREDIT FACILITY AGREEMENT
Dated as of August 5, 1994
among
WESTINGHOUSE ELECTRIC CORPORATION,
as Borrower,
THE CO-AGENTS AND LENDERS NAMED HEREIN
and
CHEMICAL BANK,
as Administrative Agent
________________________________________________________________________________
________________________________________________________________________________
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Article Section Page
- ------- ------- ----
<S> <C> <C> <C>
I. DEFINITIONS
1.01 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 Terms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
II. THE CREDITS
2.01 Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.02 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.03 Competitive Bid Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.04 Standby Borrowing Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.05 Refinancings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.06 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.07 Repayment of Loans; Evidence of Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.08 Interest on Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.09 Default Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.10 Alternate Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.11 Termination and Reduction of
Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.12 Prepayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.13 Reserve Requirements;
Change in Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.14 Change in Legality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.15 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.16 Pro Rata Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.17 Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.18 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.19 [Intentionally Omitted] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.20 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.21 Termination or Assignment of
Commitments Under Certain
Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.22 Swingline Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
III. REPRESENTATIONS AND WARRANTIES
3.01 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.02 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.03 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.04 No Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.05 Corporate Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.06 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.07 Use of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.08 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.09 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
</TABLE>
<PAGE> 3
Contents, p. 2
<TABLE>
<S> <C> <C> <C>
3.10 Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.11 Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.12 Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.13 Material Subsidiaries, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.14 No Material Misstatements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
IV. CONDITIONS OF EFFECTIVENESS AND LENDING
4.01 Initial Credit Event . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
4.02 All Credit Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
V. COVENANTS
5.01 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
5.02 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.03 Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.04 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.05 Prohibition of Fundamental Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.06 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.07 Consolidated Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.08 Consolidated Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.09 Minimum Consolidated
Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.10 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.11 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.12 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
VI. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
VII. THE AGENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
VIII. MISCELLANEOUS
8.01 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
8.02 Survival of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
8.03 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
8.04 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
8.05 Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
8.06 Right of Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.07 Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.08 Waivers; Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.09 Interest Rate Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.10 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.11 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.12 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.13 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.14 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.15 Jurisdiction; Consent to Service
of Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.16 [Intentionally Omitted] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
</TABLE>
<PAGE> 4
Contents, p. 3
<TABLE>
<S> <C> <C> <C>
8.17 Designated Bidders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.18 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.19 Termination of Existing Credit Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Exhibit A-1 Form of Competitive Bid Request
Exhibit A-2 Form of Notice of Competitive Bid Request
Exhibit A-3 Form of Competitive Bid
Exhibit A-4 Form of Competitive Bid Accept/Reject Letter
Exhibit A-5 Form of Standby Borrowing Request
Exhibit B Administrative Questionnaire
Exhibit C Form of Assignment and Acceptance
Exhibit D Form of Confidentiality Agreement
Exhibit E Form of Designation Agreement
Exhibit F Form of Opinion of Counsel
Exhibit G Form of Swingline Borrowing Request
Schedule 2.01 Commitments
Schedule 3.13 Subsidiaries
</TABLE>
<PAGE> 5
364-DAY COMPETITIVE ADVANCE AND REVOLVING CREDIT FACILITY AGREEMENT
entered into as of August 5, 1994 (this "AGREEMENT"), among WESTINGHOUSE
ELECTRIC CORPORATION, a Pennsylvania corporation (the "BORROWER"); the
lenders whose names appear on the signature pages hereto or who
subsequently become parties hereto as provided herein (the "LENDERS"); ABN
AMRO Bank N.V., Bank of Montreal, The Bank of New York, The Bank of Nova
Scotia, Barclays Bank PLC, Citibank, N.A., Continental Bank, Credit
Lyonnais New York Branch, Credit Suisse, The Dai-Ichi Kangyo Bank, Ltd.,
Deutsche Bank AG New York Branch and/or Cayman Islands Branch, The First
National Bank of Chicago, The Fuji Bank, Limited, New York Branch, The
Industrial Bank of Japan, Limited, New York Branch, LTCB Trust Company,
Mellon Bank, N.A., The Mitsubishi Bank, Limited--New York Branch, The
Mitsubishi Trust and Banking Corporation, Morgan Guaranty Trust Company of
New York, NationsBank N.C., N.A., PNC Bank, National Association, Sanwa
Bank Limited, Societe Generale, The Sumitomo Bank, Limited, The Toronto-
Dominion Bank and Union Bank of Switzerland (collectively, the
"CO-AGENTS"); and CHEMICAL BANK, a New York banking corporation, as
administrative agent for the Lenders (in such capacity, the
"ADMINISTRATIVE AGENT"; the Administrative Agent and the Co-Agents being
collectively called the "AGENTS").
The Borrower has requested the Lenders, subject to the conditions set forth
herein, (a) to extend credit in order to enable it to borrow on a revolving
credit basis on and after the date hereof and prior to the Maturity Date (as
herein defined) a principal amount not in excess of $500,000,000 at any time
outstanding and (b) to provide a procedure pursuant to which it may invite the
Lenders to bid on an uncommitted basis on short-term borrowings by it. The
proceeds of such borrowings are to be used, together with the proceeds of
borrowings under the Facility B Credit Agreement (as defined herein), to repay
in full amounts outstanding under the Existing Credit Agreement (as defined
herein), to provide working capital and for other general corporate purposes.
The Lenders are willing to extend credit to the Borrower on the terms and
subject to the conditions herein set forth.
Accordingly, the Borrower, the Lenders and the Agents agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings specified below:
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any Standby Loan or Swingline Loan bearing interest at
a rate determined by reference to the Alternate Base Rate in accordance with
the provisions of Article II.
"ADJUSTED CASH AND CASH EQUIVALENTS" shall mean, with respect to the Borrower
and its Consolidated Subsidiaries, (a) all cash and Cash Equivalents of such
entities (other than any cash and Cash Equivalents of such entities which are
subject to Liens securing obligations of such entities or of other persons),
carried at no greater than the fair market value thereof, minus (b) the sum of
(i) the estimated taxes that would be payable by such entities in the event
cash and Cash Equivalents held by the Borrower
<PAGE> 6
or any of its Consolidated Subsidiaries in Puerto Rico were transferred to
deposit accounts of the Borrower in the continental United States and (ii)
$75,000,000.
"ADJUSTED CD RATE" shall mean, with respect to any CD Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to the sum of (a) a rate per annum equal to the
product of (i) the Fixed CD Rate in effect for such Interest Period and (ii)
Statutory Reserves, plus (b) the Assessment Rate. For purposes hereof, the term
"FIXED CD RATE" shall mean the arithmetic average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the prevailing rates per annum bid at or
about 10:00 a.m., New York City time, to each Reference Bank on the first
Business Day of the Interest Period applicable to such CD Borrowing by three
New York City negotiable certificate of deposit dealers of recognized standing
for the purchase at face value of negotiable certificates of deposit of such
Reference Bank in a principal amount approximately equal to such Reference
Bank's portion of such CD Borrowing and with a maturity comparable to such
Interest Period.
"ADJUSTED CONSOLIDATED NET WORTH" shall mean, at any time, (a) Consolidated
Net Worth at such time plus (b) the amount of any reduction in such
Consolidated Net Worth to reflect all non-cash charges (including those related
to restructuring, litigation and loss on the sale of business), all net of tax
effects and computed and consolidated in accordance with GAAP.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative Questionnaire in
the form of Exhibit B hereto.
"AFFILIATE" shall mean, as to the Borrower, any person which directly or
indirectly controls, is under common control with or is controlled by the
Borrower. As used in this definition, "CONTROL" (including, with correlative
meanings, "CONTROLLED BY" and "UNDER COMMON CONTROL WITH") shall mean
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise), provided
that, in any event, any person which owns directly or indirectly 10% or more of
the securities having ordinary voting power for the election of directors or
other governing body of a corporation or 10% or more of the partnership or
other ownership interests of any other person (other than as a limited partner
of such other person) will be deemed to control such corporation or other
person. Notwithstanding the foregoing, (i) no individual shall be deemed to be
an Affiliate of the Borrower solely by reason of his or her being an officer,
director or employee of the Borrower or any of its Subsidiaries, (ii) the
Borrower and its Subsidiaries shall not be deemed to be Affiliates of each
other and (iii) no person of which the Borrower or any of its Subsidiaries
acquires or has acquired control in connection with or as a consequence of any
debt or equity financing provided to such person in the ordinary course of
business of WFSI, any of its Subsidiaries, Financial Services or WCI shall be
deemed an Affiliate of the Borrower.
"AGENT FEES" shall have the meaning assigned to such term in Section 2.06(c).
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. For purposes hereof, "PRIME RATE" shall mean
the rate of interest per annum publicly announced from time to time by the
Lender serving as Administrative Agent as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced as effective; and
"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any day, 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 on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of
the quotations for the day of such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
If for any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is unable to
ascertain the Federal Funds Effective Rate for any
<PAGE> 7
3
reason, including the inability or failure of the Administrative Agent to
obtain sufficient quotations in accordance with the terms thereof, the
Alternate Base Rate shall be the Prime Rate until the circumstances giving rise
to such inability no longer exist. Any change in the Alternate Base Rate due to
a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"APPLICABLE FACILITY FEE PERCENTAGE" shall mean on any date the applicable
percentage set forth below based upon the ratings applicable on such date to
the Borrower's senior, unsecured, non-credit-enhanced long-term indebtedness
for borrowed money ("INDEX DEBT"):
<TABLE>
<CAPTION>
PERCENTAGE
----------
<S> <C>
CATEGORY 1 .0800%
----------
Rating
------
A- or higher by S&P
A3 or higher by Moody's
A- or higher by Fitch
CATEGORY 2 .1000%
----------
Rating
------
BBB+ by S&P
Baa1 by Moody's
BBB+ by Fitch
CATEGORY 3 .1500%
----------
Rating
------
BBB by S&P
Baa2 by Moody's
BBB by Fitch
CATEGORY 4 .1875%
----------
Rating
------
BBB- by S&P
Baa3 by Moody's
BBB- by Fitch
CATEGORY 5 .3750%
----------
Rating
------
BB+ or lower by S&P
Ba1 or lower by Moody's
BB+ or lower by Fitch
</TABLE>
<PAGE> 8
4
For purposes of the foregoing, (i) if the ratings established or deemed to have
been established by Moody's, S&P and Fitch shall fall within different
Categories, the rating (or one of the ratings) in the numerically highest
Category shall be disregarded, and if the remaining two ratings shall fall
within different Categories, both of such ratings shall be deemed to fall
within the numerically higher of such Categories; (ii) if Moody's, S&P or Fitch
shall not have in effect a rating for Index Debt (other than because such
rating agency shall no longer be in the business of rating corporate debt
obligations), then such rating agency will be deemed to have established a
rating for Index Debt of Ba1, BB+ or BB+, respectively; and (iii) if any rating
established or deemed to have been established by Moody's, S&P or Fitch shall
be changed (other than as a result of a change in the rating system of Moody's,
S&P or Fitch), such change shall be effective as of the date on which it is
first announced by the applicable rating agency. Each change in the Applicable
Facility Fee Percentage shall apply during the period commencing on the
effective date of such change and ending on the date immediately preceding the
effective date of the next such change. If the rating system of Moody's, S&P or
Fitch shall change, or if any such rating agency shall cease to be in the
business of rating corporate debt obligations, the Borrower and the Lenders
shall negotiate in good faith to amend the references to specific ratings in
this definition to reflect such changed rating system or the non-availability
of ratings from such rating agency.
"APPLICABLE MARGIN" shall mean on any date, with respect to the Loans
comprising any Eurodollar Borrowing or CD Borrowing, as the case may be, the
applicable spread set forth below based upon the ratings applicable on such
date to the Index Debt:
<TABLE>
<CAPTION>
EURODOLLAR CD LOAN
LOAN SPREAD SPREAD
----------- -------
<S> <C> <C>
CATEGORY 1 .2950% .4200%
- ----------
Rating
------
A- or higher by S&P
A3 or higher by Moody's
A- or higher by Fitch
CATEGORY 2 .4000% .5250%
- ----------
Rating
------
BBB+ by S&P
Baa1 by Moody's
BBB+ by Fitch
CATEGORY 3 .4750% .6000%
- ----------
Rating
------
BBB by S&P
Baa2 by Moody's
BBB by Fitch
</TABLE>
<PAGE> 9
5
<TABLE>
<S> <C> <C>
CATEGORY 4 .5625% .6875%
- ----------
Rating
------
BBB- by S&P
Baa3 by Moody's
BBB- by Fitch
CATEGORY 5 .6250% .7500%
- ----------
Rating
------
BB+ or lower by S&P
Ba1 or lower by Moody's
BB+ or lower by Fitch
</TABLE>
For purposes of the foregoing, (i) if the ratings established or deemed to have
been established by Moody's, S&P and Fitch shall fall within different
Categories, the rating (or one of the ratings) in the numerically highest
Category shall be disregarded, and if the remaining two ratings shall fall
within different Categories, both of such ratings shall be deemed to fall
within the numerically higher of such Categories; (ii) if Moody's, S&P or Fitch
shall not have in effect a rating for Index Debt (other than because such
rating agency shall no longer be in the business of rating corporate debt
obligations), then such rating agency will be deemed to have established a
rating for Index Debt of Ba1, BB+ or BB+, respectively; and (iii) if any rating
established or deemed to have been established by Moody's, S&P or Fitch shall
be changed (other than as a result of a change in the rating system of Moody's,
S&P or Fitch), such change shall be effective as of the date on which it is
first announced by the applicable rating agency. Each change in the Applicable
Margin shall apply during the period commencing on the effective date of such
change and ending on the date immediately preceding the effective date of the
next such change. If the rating system of Moody's, S&P or Fitch shall change,
or if any such rating agency shall cease to be in the business of rating
corporate debt obligations, the Borrower and the Lenders shall negotiate in
good faith to amend the references to specific ratings in this definition to
reflect such changed rating system or the non-availability of ratings from such
rating agency.
"APPLICABLE PERCENTAGE" of any Lender at any time shall mean the
percentage of the aggregate Standby Commitments (or, following any termination
of all the Standby Commitments, the Standby Commitments most recently in
effect) represented by such Lender's Standby Commitment (or, following any such
termination, the Standby Commitment of such Lender most recently in effect).
"ASSESSMENT RATE" shall mean for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will
be employed in determining amounts payable by the Lender serving as
Administrative Agent to the Federal Deposit Insurance Corporation (or any
successor) for insurance by such Corporation (or such successor) of time
deposits made in dollars at such Lender's domestic offices.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit C.
"BOARD" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"BORROWING" shall mean a group of Loans of a single Type made by the
Lenders (or, in the case of a Competitive Borrowing, by the Lender or Lenders
whose Competitive Bids have been accepted
<PAGE> 10
6
pursuant to Section 2.03) to the Borrower on a single date and as to which a
single Interest Period is in effect.
"BUSINESS DAY" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of New York) on which banks are
open for business in New York City; PROVIDED, HOWEVER, that, when used in
connection with a Eurodollar Loan, the term "BUSINESS DAY" shall also exclude
any day on which banks are not open for dealings in dollar deposits in the
London interbank market.
"CAPITAL LEASE OBLIGATIONS" of any person shall mean the obligations
of such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.
"CASH EQUIVALENTS" shall mean (a) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America or by the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation, the Federal Home Loan Banks, the Farm Credit
Banks, the Student Loan Marketing Association or the Government National
Mortgage Association), in each case maturing within one year; (b) investments
in commercial paper maturing within 270 days and having, at such date of
acquisition, a rating of at least "P-1" from Moody's or "A-1" from S&P; (c)
investments in certificates of deposit, banker's acceptances and time deposits
maturing within 270 days issued or guaranteed by or placed with, and any money
market deposit accounts issued or offered by, any foreign bank headquartered in
Canada, France, Germany, Japan, The Netherlands, Switzerland, Italy or the
United Kingdom or any office of any commercial bank organized under the laws of
the United States of America or any State or possession thereof or the
Commonwealth of Puerto Rico having a combined capital and surplus and undivided
profits of not less than $250,000,000; (d) investments in repurchase agreements
with any commercial bank referred to in item (c) above or any investment bank
having a credit rating of "A" or better from Moody's or S&P or whose commercial
paper has a rating of at least "P-1" from Moody's or "A-1" from S&P with
respect to obligations of the type referred to in item (a), (b) or (c) above
(except that in the case of direct obligations of, or obligations the principal
of and interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are backed
by the full faith and credit of the United States of America or by the Federal
National Mortgage Association, the Federal Home Loan Mortgage Corporation, the
Federal Home Loan Banks, the Farm Credit Banks, the Student Loan Marketing
Association or the Government National Mortgage Association), such obligations
may have maturities of up to 5 years from the date of the repurchase
agreement), PROVIDED that (i) such obligations have a market value at the time
of purchase not less than the repurchase price to be paid under such repurchase
agreement, (ii) such repurchase agreement is secured by such obligations and
(iii) such repurchase agreement requires repurchase thereunder within one year;
(e) direct obligations (general or limited) of any state of the United States
of America or any political subdivision thereof or other governmental authority
maturing within one year and having a credit rating of "A" or better from
Moody's or S&P; and (f) other investment instruments approved in writing by the
Required Lenders.
"CD BORROWING" shall mean a Borrowing comprised of CD Loans.
"CD LOAN" shall mean any Standby Loan bearing interest at a rate
determined by reference to the Adjusted CD Rate in accordance with the
provisions of Article II.
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"CHANGE OF CONTROL" shall mean that any person or group of persons
(within the meaning of Sections 13 and 14 of the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), and the rules and regulations of the SEC
relating to such sections) shall have acquired beneficial ownership (within the
meaning of Rules 13d-3 and 13d-5 promulgated by the SEC pursuant to the
Exchange Act) of 25% or more of the outstanding shares of voting stock of the
Borrower.
"CLOSING DATE" shall mean August 5, 1994.
"CODE" shall mean the Internal Revenue Code of 1986, as the same may
be amended from time to time.
"COMMITMENTS" shall mean, with respect to each Lender, such Lender's
Standby Commitment and Swingline Commitment, if any. The Commitments shall
automatically and permanently terminate on the Maturity Date.
"COMPETITIVE BID" shall mean an offer to make a Competitive Loan
pursuant to Section 2.03.
"COMPETITIVE BID ACCEPT/REJECT LETTER" shall mean a notification made
by the Borrower pursuant to Section 2.03(d) in the form of Exhibit A-4.
"COMPETITIVE BID RATE" shall mean, as to any Competitive Bid made
pursuant to Section 2.03(b), (a) in the case of a Eurodollar Competitive Loan,
the Margin, and (b) in the case of a Fixed Rate Loan, the fixed rate of
interest offered by the Lender or Designated Bidder making such Competitive
Bid.
"COMPETITIVE BID REQUEST" shall mean a request made pursuant to
Section 2.03 in the form of Exhibit A-1.
"COMPETITIVE BORROWING" shall mean a Borrowing consisting of a
Competitive Loan or concurrent Competitive Loans from the Lender or Lenders (or
Designated Bidder or Bidders) whose Competitive Bid or Bids for such Borrowing
have been accepted by the Borrower under the bidding procedure described in
Section 2.03.
"COMPETITIVE LOAN" shall mean a Loan from a Lender or Designated
Bidder to the Borrower pursuant to the bidding procedure described in Section
2.03. Each Competitive Loan shall be a Eurodollar Competitive Loan or a Fixed
Rate Loan.
"CONFIDENTIALITY AGREEMENT" shall mean a confidentiality agreement
substantially in the form of Exhibit D, with such changes as the Borrower may
approve.
"CONSOLIDATED COVERAGE RATIO" shall mean, with respect to the Borrower
and its Consolidated Subsidiaries for any period, the ratio of (a) Consolidated
EBITDA for such period to (b) Consolidated Interest Expense for such period.
"CONSOLIDATED EBITDA" shall mean, with respect to the Borrower and its
Consolidated Subsidiaries for any period, (a) the sum for such period of (i)
Consolidated Net Income (less any items of non-cash income of the Borrower and
its Consolidated Subsidiaries which individually exceed $50,000,000 and are not
in the aggregate material in the context of Consolidated EBITDA), (ii)
Consolidated Interest Expense, (iii) provision for Federal, state and local
taxes (except to the extent any such provision relates to the Excluded Charge
and is included in the amount of the Excluded Charge for purposes of subclause
(vi)(z) below), (iv) depreciation expense, (v) amortization expense and (vi)
other non-cash items (including (x) provisions for losses and additions to
valuation allowances, (y) the items referred to in clauses (iii)
<PAGE> 12
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through (vi) with respect to Discontinued Operations and (z) the Excluded
Charge) (provided that amounts shall only be added pursuant to clauses
(ii) through (vi) above to the extent such amounts were deducted in computing
Consolidated Net Income for such period), minus (b) cash payments made during
each period in respect of the Excluded Charge.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, (a) the
gross interest expense of the Borrower and its Consolidated Subsidiaries
(excluding the amortization of deferred financing charges but including the
gross interest expense of the Discontinued Operations, other than the
amortization of deferred financing charges) for such period minus (b) the
interest income for such period attributable to Adjusted Cash and Cash
Equivalents of the Borrower and its Consolidated Subsidiaries (including such
interest income of the Discontinued Operations), computed and consolidated in
accordance with GAAP.
"CONSOLIDATED LEVERAGE RATIO" shall mean, with respect to the Borrower
and its Consolidated Subsidiaries at any time, the ratio of Consolidated Total
Funded Indebtedness to Adjusted Consolidated Net Worth.
"CONSOLIDATED NET INCOME" with respect to the Borrower and its
Consolidated Subsidiaries shall mean for any period the aggregate net income
(or net deficit) of such persons (including that related to the Discontinued
Operations) minus gains on the sale of assets (other than (i) inventory sold in
the ordinary course of business, (ii) gains on exercises or sales of existing
portfolio warrants or equity investments of Financial Services and (iii) gains
on sales of assets less than $5,000,000 individually and less than $50,000,000
in the aggregate during any fiscal year) and extraordinary gains, computed and
consolidated in accordance with GAAP.
"CONSOLIDATED NET WORTH" shall mean, at any time, (a) the total
shareholders' equity of the Borrower and its Consolidated Subsidiaries plus (b)
the amount of any reduction in such total shareholders' equity to reflect
changes in pension liabilities pursuant to SFAS 87 and SFAS 88, all net of tax
effect and computed and consolidated in accordance with GAAP.
"CONSOLIDATED SUBSIDIARY" shall mean, as to any person, each
Subsidiary of such person (whether now existing or hereafter created or
acquired) the financial statements of which shall be consolidated with the
financial statements of such person in accordance with GAAP.
"CONSOLIDATED TOTAL FUNDED INDEBTEDNESS" shall mean, with respect to
the Borrower and its Consolidated Subsidiaries at any date, (a) the sum at such
date of (i) all indebtedness for borrowed money (including commercial paper),
(ii) all indebtedness for the deferred purchase price of property or services
(other than trade accounts payable and accruals in the ordinary course of
business), (iii) all Capital Lease Obligations and (iv) the amount of any
indebtedness for borrowed money secured by receivables sold by the Borrower and
its Consolidated Subsidiaries pursuant to a program established for the purpose
of financing such receivables, minus (b) the Adjusted Cash and Cash Equivalents
of the Borrower and its Consolidated Subsidiaries.
"COVERAGE PERIOD" shall mean, at any date, the most recent period of
four consecutive fiscal quarters of the Borrower ended not fewer than 50 days
(or 95 days at any time after the end of a fiscal year of the Borrower and
prior to the date on which audited financial statements are required to be
delivered in respect of such year pursuant to Section 5.01(b)) prior to such
date.
"CREDIT EVENT" shall mean any Borrowing hereunder.
"DEFAULT" shall mean any Event of Default or event or condition which
upon notice, lapse of time or both would constitute an Event of Default.
<PAGE> 13
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"DESIGNATED BIDDER" shall mean an Eligible Designee that shall have
become a Designated Bidder pursuant to Section 8.17.
"DESIGNATING LENDER" shall mean, as to each Designated Bidder, the
Lender which shall have designated such Designated Bidder pursuant to Section
8.17.
"DESIGNATION AGREEMENT" shall mean a designation agreement
substantially in the form of Exhibit E executed by a Designating Lender and an
Eligible Designee.
"DISCONTINUED OPERATIONS" shall mean the discontinued operations of
the Borrower and its subsidiaries as set forth in the 1992 Financial Statements
and any additional business classified subsequent to December 31, 1992 as
Discontinued Operations.
"DOLLARS" or "$" shall mean lawful money of the United States of
America.
"ELIGIBLE DESIGNEE" shall mean (a) any bank or financial institution
and (b) any special purpose corporation engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its business
that issues (or the parent of which issues) commercial paper rated at least
"P-1" by Moody's or "A-1" by S&P or having a comparable rating from the
successor of either such rating agency, and that in either case (i) is
organized under the laws of the United States or any state thereof, (ii) is not
a Lender and (iii) is acceptable to the Borrower (such acceptance not to be
unreasonably withheld).
"ENVIRONMENTAL LAWS" shall mean any and all Federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
other governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment, including, without limitation, ambient air, surface water, ground
water or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or industrial, toxic or hazardous
substances or wastes.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) that is a member of a group of which the Borrower is a member and
which is treated as a single employer under Section 414 of the Code.
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of one or more
Eurodollar Loans.
"EURODOLLAR COMPETITIVE BORROWING" shall mean a Borrowing comprised of
one or more Eurodollar Competitive Loans.
"EURODOLLAR COMPETITIVE LOAN" shall mean any Competitive Loan bearing
interest at a rate determined by reference to the LIBO Rate in accordance with
the provisions of Article II.
"EURODOLLAR LOAN" shall mean any Eurodollar Competitive Loan or
Eurodollar Standby Loan.
"EURODOLLAR STANDBY BORROWING" shall mean a Borrowing comprised of one
or more Eurodollar Standby Loans.
<PAGE> 14
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"EURODOLLAR STANDBY LOAN" shall mean any Standby Loan bearing interest
at a rate determined by reference to the LIBO Rate in accordance with the
provisions of Article II.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Article VI.
"EXCLUDED CHARGE" shall mean the Borrower's fourth fiscal quarter 1993
charge to earnings in the amount, on a pre-tax basis, of $750,000,000, and
other similar non-cash charges taken by the Borrower in subsequent periods.
"EXISTING CREDIT AGREEMENT" shall mean the Amended and Restated
Competitive Advance and Revolving Credit Facility Agreement dated as of May 3,
1993, as amended, among the Borrower, the lenders party thereto and co-agents
named therein and Chemical Bank, as Administrative Agent.
"FACILITY B CREDIT AGREEMENT" shall mean the Three-Year Competitive
Advance and Revolving Credit Facility Agreement dated as of the date hereof
among the Borrower, the lenders party thereto and co-agents named therein and
Chemical Bank, as administrative agent for the lenders.
"FACILITY FEE" shall have the meaning assigned to such term in Section
2.06(a).
"FEDERAL FUNDS EFFECTIVE RATE" shall have the meaning assigned thereto
in the definition of Alternate Base Rate.
"FEE LETTER" shall mean any commitment letter or other letter
agreement (including any schedules or exhibits thereto) between the Borrower
and the Administrative Agent or any Co-Agent providing for the payment of fees
or other amounts in connection with the credit facilities established by this
Agreement.
"FEES" shall mean the Facility Fee and the Agent Fees.
"FINANCIAL OFFICER" of any corporation shall mean its chief financial
officer, its Vice President and Treasurer or its Vice President and Controller
or, in each case, any comparable officer or any person designated by any such
officer.
"FINANCIAL SERVICES" shall mean those operations designated as the
Financial Services portion of Discontinued Operations in the audited
consolidated financial statements of the Borrower at December 31, 1993.
"FITCH" shall mean Fitch Investors Service Inc.
"FIXED RATE BORROWING" shall mean a Borrowing comprised of one or more
Fixed Rate Loans.
"FIXED RATE LOAN" shall mean any Competitive Loan bearing interest at
a fixed percentage rate per annum (expressed in the form of a decimal to no
more than four decimal places) specified by the Lender making such Loan in its
Competitive Bid.
"FSC" shall mean a subsidiary of the Borrower or any of its
Subsidiaries which is a FSC as defined in Section 922 of the Code, or in any
successor provision, and which is used solely for the purpose of a single lease
project or lease transaction or related lease projects or lease transactions
and is not related to property predominantly manufactured by the Borrower or
any of its Subsidiaries.
"GAAP" shall mean generally accepted accounting principles applied on
a consistent basis (but subject to changes approved by the Borrower's
independent public accountants).
<PAGE> 15
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"GOVERNMENTAL AUTHORITY" shall mean any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.
"GUARANTEE" of or by any person shall mean any obligation, contingent
or otherwise, of such person guaranteeing or entered into with the purpose of
guaranteeing any Indebtedness of any other person (the "PRIMARY OBLIGOR") in
any manner, whether directly or indirectly, and including any obligation of
such person, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or to purchase (or to
advance or supply funds for the purchase of) any security for the payment of
such Indebtedness, (b) to purchase property, securities or services for the
purpose of assuring the owner of such Indebtedness of the payment of such
Indebtedness or (c) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness; PROVIDED, HOWEVER, that
the term Guarantee shall not include endorsements for collection or deposit, in
either case in the ordinary course of business.
"INDEBTEDNESS" of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such person
upon which interest charges are customarily paid, (d) all obligations of such
person under conditional sale or other title retention agreements relating to
property or assets purchased by such person, (e) all obligations of such person
issued or assumed as the deferred purchase price of property or services, (f)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such person, whether or not the
obligations secured thereby have been assumed, (g) all Guarantees by such
person of Indebtedness of others, (h) all Capital Lease Obligations of such
person and (i) all obligations of such person as an account party in respect of
outstanding letters of credit (whether or not drawn) and bankers' acceptances;
PROVIDED, HOWEVER, that Indebtedness shall not include (i) trade accounts
payable arising in the ordinary course of business, (ii) deferred compensation
or (iii) any Indebtedness of such person (other than any such person that is a
FSC) to the extent (A) such Indebtedness does not appear on the financial
statements of such person, (B) such Indebtedness is recourse only to certain
assets of such person and (C) the assets to which such Indebtedness is recourse
only appear on the financial statements of such person net of such
Indebtedness; and PROVIDED FURTHER that the amount of any Indebtedness in
clause (f) shall be the lower of the amount of the obligation or the fair
market value of the collateral securing such obligation. The Indebtedness of
any person shall include the Indebtedness of any partnership in which such
person is a general partner, which Indebtedness is recourse to such general
partner.
"INDEX DEBT" shall have the meaning assigned thereto in the definition
of Applicable Facility Fee Percentage.
"INTEREST PAYMENT DATE" shall mean, with respect to any Loan, the last
day of the Interest Period applicable thereto and, in the case of a Eurodollar
Loan with an Interest Period of more than three months' duration or a Fixed
Rate Loan or a CD Loan with an Interest Period of more than 90 days' duration,
each day that would have been an Interest Payment Date for such Loan had
successive Interest Periods of three months' duration or 90 days duration, as
the case may be, been applicable to such Loan and, in addition, the date of any
refinancing or conversion of such Loan with or to a Loan of a different Type,
the date of prepayment of such Loan and the Maturity Date.
"INTEREST PERIOD" shall mean (a) as to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing or on the last day of the
immediately preceding Interest Period applicable to such Borrowing, as the case
may be, and ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month that is
1, 2, 3, 6 or, subject to the agreement of each Lender, 9 months thereafter, as
the Borrower may elect, (b) as to any CD Borrowing,
<PAGE> 16
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a period of 30, 60, 90, 180 or, subject to the agreement of each Lender,
270 days' duration, as the Borrower may elect, commencing on the date of such
Borrowing, (c) as to any ABR Borrowing (other than a Swingline Borrowing),
the period commencing on the date of such Borrowing and ending on the date
90 days thereafter or, if earlier, on the Maturity Date or the date of
prepayment of such Borrowing, (d) as to any Swingline Borrowing, the period
commencing on the date of such Swingline Borrowing and ending on the earlier
of (i) the day that is five Business Days thereafter and (ii) the Maturity
Date, and (e) as to any Fixed Rate Borrowing, the period commencing on the
date of such Borrowing and ending on the date specified in the Competitive
Bids in which the offer to make the Fixed Rate Loans comprising such
Borrowing were extended, which shall not be earlier than seven days after
the date of such Borrowing or later than 360 days after the date of such
Borrowing; PROVIDED, HOWEVER, that if any Interest Period would end on a day
other than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of Eurodollar Loans only, such
next succeeding Business Day would fall in the next calendar month, in which
case such Interest Period shall end on the next preceding Business Day.
Interest shall accrue from and including the first day of an Interest Period
to but excluding the last day of such Interest Period.
"LIBO RATE" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the average of the rates at which dollar
deposits approximately equal in principal amount to (i) in the case of a
Standby Borrowing, the portion of such Eurodollar Borrowing of the Lender
serving as Administrative Agent and (ii) in the case of a Competitive
Borrowing, a principal amount that would have been the portion of such
Competitive Borrowing of the Lender serving as Administrative Agent had such
Competitive Borrowing been a Standby Borrowing, and for a maturity comparable
to such Interest Period are offered by the principal London offices of the
Reference Banks (or, if any Reference Bank does not at the time maintain a
London office, the principal London office of any affiliate of such Reference
Bank) for immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"LIEN" shall mean, with respect to any asset or property, (a) any
mortgage, deed of trust, lien, pledge, encumbrance, charge or security interest
in or on such asset or property and (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement relating to such asset or property.
"LOAN" shall mean a Competitive Loan, a Swingline Loan or a Standby
Loan, whether made as a Eurodollar Loan, a CD Loan, an ABR Loan or a Fixed Rate
Loan, as permitted hereby.
"LOAN DOCUMENTS" shall mean this Agreement, the Fee Letters and the
Designation Agreements, and any amendment, restatement, supplement,
modification or waiver of, to or in respect of any of the foregoing.
"MARGIN" shall mean, as to any Eurodollar Competitive Loan, the margin
(expressed as a percentage rate per annum in the form of a decimal to no more
than four decimal places) to be added to or subtracted from the LIBO Rate in
order to determine the interest rate applicable to such Loan, as specified in
the Competitive Bid relating to such Loan.
"MARGIN STOCK" shall have the meaning given such term under
Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean (a) a material adverse effect on
the Property, business, results of operations or financial condition of the
Borrower and its Subsidiaries taken as a whole or (b) material impairment of
the ability of the Borrower to perform any of its obligations hereunder.
<PAGE> 17
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"MATERIAL SUBSIDIARY" shall mean any Subsidiary of the Borrower except
for Subsidiaries which in the aggregate would not constitute a significant
subsidiary under Regulation S-X of the SEC.
"MATURITY DATE" shall mean August 4, 1995.
"MOODY'S" shall mean Moody's Investors Service, Inc.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan as defined in
Section 3(37) of ERISA to which contributions have been made by the Borrower or
any ERISA Affiliate of the Borrower and which is covered by Title IV of ERISA.
"1992 FINANCIAL STATEMENTS" shall mean the audited consolidated
financial statements of the Borrower and its subsidiaries as of and for the
year ended December 31, 1992 as set forth in the Annual Report on Form 10-K/A
of the Borrower.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred
to and defined in ERISA.
"PERSON" shall mean any natural person, corporation, business trust,
joint venture, association, company, partnership or government, or any agency
or political subdivision thereof.
"PLAN" shall mean any employee pension benefit plan as defined in
Section 3(2) of ERISA (other than a Multiemployer Plan) subject to the
provisions of Title IV of ERISA or Section 412 of the Code and which is
maintained for employees of the Borrower or any ERISA Affiliate.
"PROPERTY" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"REFERENCE BANKS" shall mean Chemical Bank, Union Bank of Switzerland
and NationsBank N.C., N.A..
"REGISTER" shall have the meaning given such term in Section 8.04(d).
"REGULATION D" shall mean Regulation D of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION G" shall mean Regulation G of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REQUIRED LENDERS" shall mean, at any time, Lenders having Standby
Commitments (whether or not used) representing at least a majority of the Total
Commitment or, for purposes of acceleration of the Loans pursuant to clause
(ii) of Article VI or following termination of the Commitments, Lenders holding
Loans representing at least a majority of the aggregate principal amount of the
Loans outstanding.
"RESPONSIBLE OFFICER" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof responsible for the administration of the obligations
of such corporation in respect of this Agreement (or, in the case of matters
relating to ERISA, any officer responsible for the administration of the
pension funds of such corporation).
<PAGE> 18
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"S&P" shall mean Standard & Poor's Corporation.
"SEC" shall mean the Securities and Exchange Commission.
"STANDBY BORROWING" shall mean a group of Standby Loans made by the
Lenders on a single date.
"STANDBY BORROWING REQUEST" shall mean a request made pursuant to
Section 2.04 in the form of Exhibit A-5.
"STANDBY COMMITMENT" shall mean, with respect to each Lender, the
commitment of such Lender to make Standby Loans pursuant to Section 2.01 as set
forth on Schedule 2.01, as such Lender's Standby Commitment may be permanently
terminated or reduced from time to time pursuant to Section 2.11.
"STANDBY LOANS" shall mean the revolving loans made by the Lenders to
the Borrower pursuant to Section 2.04. Each Standby Loan shall be a Eurodollar
Standby Loan, a CD Loan or an ABR Loan.
"STATUTORY RESERVES" shall mean a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental reserves) expressed as a
decimal established by the Board and any other banking authority to which the
Lender serving as Administrative Agent is subject for new negotiable
nonpersonal time deposits in dollars of over $100,000 with maturities
approximately equal to the applicable Interest Period, in the case of the
Adjusted CD Rate. Statutory Reserves shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"SUBSIDIARY" shall mean, for any person (the "Parent"), any
corporation, partnership or other entity of which securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) are at the time directly
or indirectly owned or controlled by the Parent or one or more of its
Subsidiaries or by the Parent and one or more of its Subsidiaries; PROVIDED,
HOWEVER, that (a) no person of which the Borrower or any of its Subsidiaries
acquires or has acquired control in connection with or as a consequence of any
debt or equity financing provided to such person in the ordinary course of the
business of WFSI, any of its Subsidiaries, Financial Services or WCI shall be
deemed a Subsidiary of the Borrower, (b) for purposes of paragraph (d) of
Article VI, no person which is a FSC shall be deemed a Subsidiary of the
Borrower and (c) Micros Systems, Inc. shall not be deemed a Subsidiary of the
Borrower as long as it has a class of equity securities registered under
Section 12 of the Securities Exchange Act of 1934, as amended.
"SWINGLINE BORROWING" shall mean a group of Swingline Loans made by
the Swingline Lenders on a single date.
"SWINGLINE COMMITMENT" shall mean, with respect to any Lender, the
commitment (if any) of such Lender to make Swingline Loans pursuant to Section
2.22, as set forth on Schedule 2.01 or designated by the Borrower in an
agreement between the Borrower and any such Lender, as such Lender's Swingline
Commitment may be permanently terminated or reduced from time to time pursuant
to Section 2.22(d).
"SWINGLINE EXPOSURES" shall mean at any time the aggregate principal
amount at such time of the outstanding Swingline Loans. The Swingline Exposure
of any Lender at any time shall mean its Applicable Percentage of the aggregate
Swingline Exposures at such time.
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15
"SWINGLINE LENDER" shall mean a Lender with a Swingline Commitment.
"SWINGLINE LOAN" shall mean any loan made by a Swingline Lender
pursuant to its Swingline Commitment. Each Swingline Loan shall be an ABR Loan.
"SWINGLINE PERCENTAGE" of any Swingline Lender at any time shall mean
the percentage of the aggregate Swingline Commitments represented by such
Swingline Lender's Swingline Commitment.
"TOTAL COMMITMENT" shall mean at any time the aggregate amount of the
Lenders' Standby Commitments, as in effect at such time.
"TYPE", when used in respect of any Loan or Borrowing, shall refer to
the Rate by reference to which interest on such Loan or on the Loans comprising
such Borrowing is determined. For purposes hereof, "Rate" shall mean the LIBO
Rate, the Adjusted CD Rate, the Alternate Base Rate and the rate paid on Fixed
Rate Loans.
"U.S. PERSON" shall mean a citizen, national or resident of the United
States of America, or an entity organized in or under the laws of the United
States of America.
"WHOLLY OWNED SUBSIDIARY" shall mean any Subsidiary of which all
securities or other ownership interests referred to in the definition of
"Subsidiary" (other than, in the case of a corporation, directors' qualifying
shares) are owned directly or indirectly by the Parent (as defined in such
definition).
"WCI" shall mean WCI Communities, Inc., a Delaware corporation, and
its Wholly Owned Subsidiaries.
"WFSI" shall mean Westinghouse Financial Services, Inc., a Delaware
corporation that was merged into the Borrower on May 5, 1993.
SECTION 1.02. TERMS GENERALLY. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "INCLUDE", "INCLUDES" and
"INCLUDING" shall, except where the context otherwise requires, be deemed to be
followed by the phrase "WITHOUT LIMITATION". All references herein to Articles,
Sections, Exhibits and Schedules shall be deemed references to Articles and
Sections of, and Exhibits and Schedules to, this Agreement unless the context
shall otherwise require. Except as otherwise expressly provided herein, all
terms of an accounting nature shall be construed in accordance with GAAP as in
effect from time to time; PROVIDED, HOWEVER, that, for purposes of determining
compliance with the covenants set forth in Sections 5.07, 5.08 and 5.09 (such
Sections being referred to as the "FINANCIAL COVENANTS"), (i) except as
otherwise set forth in subsection (ii) below or in the Financial Covenants and
the definitions related thereto, such terms shall be construed in accordance
with GAAP as in effect on December 31, 1993, applied on a basis consistent with
the application used in preparing the Borrower's audited financial statements
prepared as of such date and (ii) indebtedness shall include obligations and
liabilities applicable to the Discontinued Operations but shall exclude any
obligation or liability which is specifically excluded from the definition of
"INDEBTEDNESS".
ARTICLE II. THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make Standby Loans to the Borrower, at
any time and from time to time on and after the Closing Date and until
<PAGE> 20
16
the earlier of the Maturity Date and the termination of the Standby Commitment
of such Lender, in an aggregate principal amount at any time outstanding not
to exceed such Lender's Standby Commitment minus the sum of (a) the amount by
which the Competitive Loans outstanding at such time shall be deemed to have
used such Standby Commitment pursuant to Section 2.16 and (b) such Lender's
Swingline Exposure at such time, subject, however, to the conditions that (x)
at no time shall the sum of (i) the outstanding aggregate principal amount of
all Standby Loans, (ii) the outstanding aggregate principal amount of all
Competitive Loans, and (iii) the outstanding aggregate principal amount of
all Swingline Loans exceed the Total Commitment and (y) at all times the
outstanding aggregate principal amount of all Standby Loans made by each
Lender shall equal such Lender's Applicable Percentage of the outstanding
aggregate principal amount of all Standby Loans made pursuant to Section 2.04.
Within the foregoing limits, the Borrower may borrow, pay or prepay
and reborrow Standby Loans hereunder, on and after the date hereof and prior to
the Maturity Date, subject to the terms, conditions and limitations set forth
herein.
SECTION 2.02. LOANS. (a) Each Standby Loan shall be made as part of a
Borrowing consisting of Loans made by the Lenders to the Borrower ratably in
accordance with their Standby Commitments; PROVIDED, HOWEVER, that the failure
of any Lender to make any Standby Loan shall not in itself relieve any other
Lender of its obligation to lend hereunder (it being understood, however, that
no Lender shall be responsible for the failure of any other Lender to make any
Loan required to be made by such other Lender). Each Competitive Loan shall be
made in accordance with the procedures set forth in Section 2.03. The Standby
Loans or Competitive Loans comprising any Borrowing shall be (i) in the case of
Competitive Loans, in an aggregate principal amount which is an integral
multiple of $1,000,000 and not less than $5,000,000 and (ii) in the case of
Standby Loans, in an aggregate principal amount which is an integral multiple
of $5,000,000 and not less than (A) $50,000,000 in the case of Eurodollar Loans
or CD Loans and (B) $25,000,000 in the case of ABR Loans (or an aggregate
principal amount equal to the remaining balance of the available Standby
Commitments).
(b) Each Competitive Borrowing shall be comprised entirely of one or
more Eurodollar Competitive Loans or Fixed Rate Loans, and each Standby
Borrowing shall be comprised entirely of Eurodollar Standby Loans, CD Loans or
ABR Loans, as the Borrower may request pursuant to Section 2.03 or 2.04, as
applicable. Each Lender may at its option make any Eurodollar Loan by causing
any domestic or foreign branch or Affiliate of such Lender to make such Loan;
PROVIDED that any exercise of such option shall not affect the obligation of
the Borrower to repay such Loan in accordance with the terms of this Agreement.
Borrowings of more than one Type may be outstanding at the same time; PROVIDED,
HOWEVER, that the Borrower shall not be entitled to request any Borrowing
which, if made, would result in an aggregate of more than eight separate
Standby Loans of any Lender being outstanding hereunder at any one time. For
purposes of the foregoing, Loans having different Interest Periods, regardless
of whether they commence on the same date, shall be considered separate Loans.
(c) Subject to Section 2.05, each Lender shall make each Loan (other
than a Swingline Loan, as to which this Section 2.02 shall not apply) to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds to the Administrative Agent in New York, New York,
not later than 12:00 noon, New York City time (or, in connection with an ABR
Borrowing to be made on the same day on which a notice is submitted, 12:30
p.m.) and the Administrative Agent shall by 3:00 p.m., New York City time,
credit the amounts so received to the general deposit account of the Borrower
with the Administrative Agent or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met,
return the amounts so received to the respective Lenders by wire transfer of
immediately available funds. Competitive Loans shall be made by the Lender or
Lenders whose Competitive Bids therefor are accepted pursuant to Section 2.03
in the amounts so accepted and Standby Loans shall be made by the Lenders pro
rata in accordance with Section 2.16. Unless the Administrative Agent shall
have received notice from a Lender prior to the proposed date of any Borrowing
that such Lender will not make available to the Administrative
<PAGE> 21
17
Agent such Lender's portion of such Borrowing, the Administrative Agent may
assume that such Lender has made such portion available to the Administrative
Agent on the date of such Borrowing in accordance with this paragraph (c) and
the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If and to the extent that
such Lender shall not have made such portion available to the Administrative
Agent, such Lender and the Borrower severally agree to repay to the
Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrower, the interest rate
applicable at the time to the Loans comprising such Borrowing and (ii) in the
case of such Lender, the Federal Funds Effective Rate. If such Lender shall
repay to the Administrative Agent such corresponding amount, such amount shall
constitute such Lender's Loan as part of such Borrowing for purposes of this
Agreement; PROVIDED that such repayment shall not release such Lender from any
liability it may have to the Borrower for the failure to make such Loan at the
time required herein.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request any Borrowing if the Interest Period
requested with respect thereto would end after the Maturity Date.
SECTION 2.03. COMPETITIVE BID PROCEDURE. (a) In order to request
Competitive Bids, the Borrower shall hand deliver or telecopy to the
Administrative Agent a duly completed Competitive Bid Request in the form of
Exhibit A-1, to be received by the Administrative Agent (i) in the case of a
Eurodollar Competitive Borrowing, not later than 10:00 a.m., New York City
time, four Business Days before a proposed Competitive Borrowing and (ii) in
the case of a Fixed Rate Borrowing, not later than 10:00 a.m., New York City
time, one Business Day before a proposed Competitive Borrowing. No CD Loan or
ABR Loan shall be requested in, or made pursuant to, a Competitive Bid Request.
A Competitive Bid Request that does not conform substantially to the format of
Exhibit A-1 may be rejected in the Administrative Agent's discretion (exercised
in good faith), and the Administrative Agent shall promptly notify the Borrower
of such rejection by telecopier. Such request shall in each case refer to this
Agreement and specify (x) whether the Borrowing then being requested is to be a
Eurodollar Borrowing or a Fixed Rate Borrowing, (y) the date of such Borrowing
(which shall be a Business Day) and the aggregate principal amount thereof
which shall be in a minimum principal amount of $25,000,000 and in an integral
multiple of $1,000,000, and (z) the Interest Period with respect thereto (which
may not end after the Maturity Date). Promptly after its receipt of a
Competitive Bid Request that is not rejected as aforesaid (and in any event by
5:00 p.m., New York City time, on the date of such receipt if such receipt
occurs by the time specified in the first sentence of this paragraph), the
Administrative Agent shall invite by telecopier (in the form set forth in
Exhibit A-2) the Lenders to bid, on the terms and conditions of this Agreement,
to make Competitive Loans pursuant to the Competitive Bid Request.
(b) Each Lender may, in its sole discretion, make one or more
Competitive Bids to the Borrower responsive to a Competitive Bid Request. Each
Competitive Bid must be received by the Administrative Agent via telecopier, in
the form of Exhibit A-3, (i) in the case of a Eurodollar Competitive Borrowing,
not later than 9:30 a.m., New York City time, three Business Days before a
proposed Competitive Borrowing and (ii) in the case of a Fixed Rate Borrowing,
not later than 9:30 a.m., New York City time, on the day of a proposed
Competitive Borrowing. Multiple Competitive Bids will be accepted by the
Administrative Agent. Competitive Bids that do not conform substantially to the
format of Exhibit A-3 may be rejected by the Administrative Agent after
conferring with, and upon the instruction of, the Borrower, and the
Administrative Agent shall notify the Lender making such nonconforming
Competitive Bid of such rejection as soon as practicable. Each Competitive Bid
shall refer to this Agreement and specify (x) the principal amount (which shall
be in a minimum principal amount of $5,000,000 and in an integral multiple of
$1,000,000 and which may equal the entire principal amount of the Competitive
Borrowing requested
<PAGE> 22
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by the Borrower) of the Competitive Loan or Loans that the applicable Lender
is willing to make to the Borrower, (y) the Competitive Bid Rate or Rates at
which such Lender is prepared to make the Competitive Loan or Loans and (z)
the Interest Period and the last day thereof. A Competitive Bid submitted
pursuant to this paragraph (b) shall be irrevocable (subject to the
satisfaction of the conditions to borrowing set forth in Article IV).
(c) The Administrative Agent shall promptly (and in any event by 10:15
a.m., New York City time, on the date on which such Competitive Bids shall have
been made) notify the Borrower by telecopier of all the Competitive Bids made,
the Competitive Bid Rate and the principal amount of each Competitive Loan in
respect of which a Competitive Bid was made and the identity of the Lender that
made each Competitive Bid. The Administrative Agent shall send a copy of all
Competitive Bids to the Borrower for its records as soon as practicable after
completion of the bidding process set forth in this Section 2.03.
(d) The Borrower may in its sole and absolute discretion, subject only
to the provisions of this paragraph (d), accept or reject any Competitive Bid
referred to in paragraph (c) above. The Borrower shall notify the
Administrative Agent by telephone, confirmed by telecopier in the form of a
Competitive Bid Accept/Reject Letter, whether and to what extent it has decided
to accept or reject any of or all the Competitive Bids referred to in paragraph
(c) above, (x) in the case of a Eurodollar Competitive Borrowing, not later
than 11:00 a.m., New York City time, three Business Days before a proposed
Competitive Borrowing, and (y) in the case of a Fixed Rate Borrowing, not later
than 11:00 a.m., New York City time, on the day of a proposed Competitive
Borrowing; PROVIDED, HOWEVER, that (i) the failure by the Borrower to give such
notice shall be deemed to be a rejection of all the Competitive Bids referred
to in paragraph (c) above, (ii) the Borrower shall not accept a Competitive Bid
made at a particular Competitive Bid Rate if it has decided to reject a
Competitive Bid made at a lower Competitive Bid Rate, (iii) the aggregate
amount of the Competitive Bids accepted by the Borrower shall not exceed the
principal amount specified in the Competitive Bid Request (but may be less than
that requested), (iv) if the Borrower shall accept a Competitive Bid or
Competitive Bids made at a particular Competitive Bid Rate but the amount of
such Competitive Bid or Competitive Bids shall cause the total amount of
Competitive Bids to be accepted by it to exceed the amount specified in the
Competitive Bid Request, then the Borrower shall accept a portion of such
Competitive Bid or Competitive Bids in an amount equal to the amount specified
in the Competitive Bid Request less the amount of all other Competitive Bids
accepted with respect to such Competitive Bid Request, which acceptance, in the
case of multiple Competitive Bids at such Competitive Bid Rate, shall be made
pro rata in accordance with the amount of each such Competitive Bid at such
Competitive Bid Rate, and (v) except pursuant to clause (iv) above, no
Competitive Bid shall be accepted for a Competitive Loan unless such
Competitive Loan is in a minimum principal amount of $5,000,000 and an integral
multiple of $1,000,000; PROVIDED FURTHER, HOWEVER, that if a Competitive Loan
must be in an amount less than $5,000,000 because of the provisions of clause
(iv) above, such Competitive Loan may be for a minimum of $1,000,000 or any
integral multiple thereof, and in calculating the pro rata allocation of
acceptances of portions of multiple Competitive Bids at a particular
Competitive Bid Rate pursuant to clause (iv) the amounts shall be rounded to
integral multiples of $1,000,000 in a manner which shall be in the discretion
of the Borrower. A notice given by the Borrower pursuant to this paragraph (d)
shall be irrevocable.
(e) The Administrative Agent shall promptly notify each bidding Lender
whether or not its Competitive Bid has been accepted (and if so, in what amount
and at what Competitive Bid Rate) by telecopy sent by the Administrative Agent,
and each successful bidder will thereupon become bound, subject to the other
applicable conditions hereof, to make the Competitive Loan in respect of which
its Competitive Bid has been accepted.
(f) A Competitive Bid Request shall not be made within five Business
Days after the date of any previous Competitive Bid Request, unless the
Borrower and the Administrative Agent shall mutually agree otherwise.
<PAGE> 23
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(g) If the Administrative Agent shall elect to submit a Competitive
Bid in its capacity as a Lender, it shall submit such Competitive Bid directly
to the Borrower one quarter of an hour earlier than the latest time at which
the other Lenders are required to submit their Competitive Bids to the
Administrative Agent pursuant to paragraph (b) above.
(h) All notices required by this Section 2.03 shall be given in
accordance with Section 8.01.
SECTION 2.04. STANDBY BORROWING PROCEDURE. In order to request a
Standby Borrowing, the Borrower shall hand deliver or telecopy to the
Administrative Agent a Standby Borrowing Request in the form of Exhibit A-5 (a)
in the case of a Eurodollar Standby Borrowing, not later than 10:30 a.m., New
York City time, three Business Days before a proposed borrowing, (b) in the
case of a CD Borrowing, not later than 10:30 a.m., New York City time, one
Business Day before a proposed borrowing and (c) in the case of an ABR
Borrowing, not later than 10:30 a.m., New York City time, on the day of a
proposed borrowing. No Fixed Rate Loan shall be requested or made pursuant to a
Standby Borrowing Request. Such notice shall be irrevocable and shall in each
case specify (i) whether the Borrowing then being requested is to be a
Eurodollar Standby Borrowing, a CD Borrowing or an ABR Borrowing; (ii) the date
of such Standby Borrowing (which shall be a Business Day) and the amount
thereof; and (iii) if such Borrowing is to be a Eurodollar Standby Borrowing or
CD Borrowing, the Interest Period with respect thereto. If no election as to
the Type of Standby Borrowing is specified in any such notice, then the
requested Standby Borrowing shall be an ABR Borrowing. If no Interest Period
with respect to any Eurodollar Standby Borrowing or CD Borrowing is specified
in any such notice, then the Borrower shall be deemed to have selected an
Interest Period of one month's duration, in the case of a Eurodollar Standby
Borrowing, or 30 days' duration, in the case of a CD Borrowing. If the Borrower
shall not have given notice in accordance with this Section 2.04 of its
election to refinance a Standby Borrowing prior to the end of the Interest
Period in effect for such Borrowing, then the Borrower shall (unless such
Borrowing is repaid at the end of such Interest Period) be deemed to have given
notice of an election to refinance such Borrowing with an ABR Borrowing. The
Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.04 and of each Lender's portion of the requested
Borrowing.
SECTION 2.05. REFINANCINGS. The Borrower may refinance all or any part
of any Borrowing (whether a Competitive Borrowing, Standby Borrowing or
Swingline Borrowing) with a Borrowing of the same or a different Type made
pursuant to Section 2.03, Section 2.04 or Section 2.22, subject to the
conditions and limitations set forth herein and elsewhere in this Agreement.
Any Borrowing or part thereof so refinanced shall be deemed to be repaid in
accordance with Section 2.07, 2.12 or 2.22 with the proceeds of a new Borrowing
hereunder and the proceeds of the new Borrowing, to the extent they do not
exceed the principal amount of the Borrowing being refinanced, shall not be
paid by the Lenders to the Administrative Agent or by the Administrative Agent
to the Borrower pursuant to Section 2.02(c); PROVIDED, HOWEVER, that (i) if the
principal amount extended by a Lender in a refinancing is greater than the
principal amount extended by such Lender in the Borrowing being refinanced,
then such Lender shall pay such difference to the Administrative Agent for
distribution to the Lenders described in (ii) below, (ii) if the principal
amount extended by a Lender in the Borrowing being refinanced is greater than
the principal amount being extended by such Lender in the refinancing, the
Administrative Agent shall return the difference to such Lender out of amounts
received pursuant to (i) above, and (iii) to the extent any Lender fails to pay
the Administrative Agent amounts due from it pursuant to (i) above, any Loan or
portion thereof being refinanced with such amounts shall not be deemed repaid
in accordance with Section 2.07 and shall be payable by the Borrower (but the
Borrower shall not be deemed to be in default in respect of its obligation to
make such payment until one Business Day after the Administrative Agent shall
have notified it of the failure of such Lender to make such payment).
SECTION 2.06. FEES. (a) The Borrower agrees to pay to each Lender,
through the Administrative Agent, on each March 31, June 30, September 30 and
December 31 and on the Maturity Date or the date
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on which the Standby Commitment of such Lender shall be terminated as provided
herein, a facility fee (a "FACILITY FEE") at a rate per annum equal to the
Applicable Facility Fee Percentage from time to time in effect on the amount
of the Standby Commitment of such Lender from time to time in effect, whether
used or unused, during the preceding quarter (or shorter period commencing
with the Closing Date, or ending with the Maturity Date or any date on which
the Standby Commitment of such Lender shall be terminated). All Facility Fees
shall be computed on the basis of the actual number of days elapsed in a year
of 360 days.
The Facility Fee due to each Lender shall commence to accrue on the Closing
Date and shall cease to accrue on the earlier of the Maturity Date and the
termination of the Standby Commitment of such Lender as provided herein.
(b) [Intentionally Omitted]
(c) The Borrower agrees to pay to the Agents, through the
Administrative Agent, for their own accounts, the fees ("AGENT FEES") provided
for in the Fee Letters at the times provided therein.
(d) [Intentionally Omitted]
(e) All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders. Once paid, none of the Fees shall be refundable under any
circumstances (other than corrections of errors in payment).
SECTION 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The
outstanding principal balance of each Loan shall be payable on the last day of
the Interest Period applicable thereto and on the Maturity Date. Each Loan
shall bear interest from and including the date thereof on the outstanding
principal balance thereof as set forth in Section 2.08.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness to such Lender resulting
from each Loan from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time under this
Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type of each Loan and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs
(b) and (c) of this Section 2.07 shall, to the extent permitted by applicable
law, be PRIMA FACIE evidence of the existence and amounts of the obligations
therein recorded; PROVIDED, HOWEVER, that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not
in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
SECTION 2.08. INTEREST ON LOANS. (a) Subject to the provisions of
Section 2.09, the Loans comprising each Eurodollar Borrowing shall bear
interest (computed on the basis of the actual number of days elapsed over a
year of 360 days) at a rate per annum equal to (i) in the case of each
Eurodollar Standby Loan, the LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin and (ii) in the case of each
Eurodollar Competitive Loan, the LIBO Rate for the Interest Period in effect
for such Borrowing plus the Margin offered by the Lender making such Loan and
accepted by the Borrower pursuant to Section 2.03. Interest on each Eurodollar
Borrowing shall be payable on each applicable Interest Payment Date. The LIBO
Rate for each Interest Period shall be determined by the
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Administrative Agent, and such determination shall be conclusive absent
manifest error. The Administrative Agent shall promptly advise the Borrower
and each Lender, as appropriate, of such determination.
(b) Subject to the provisions of Section 2.09, the Loans comprising
each CD Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to
the Adjusted CD Rate for the Interest Period in effect for such Borrowing plus
the Applicable Margin. Interest on each CD Borrowing shall be payable on each
applicable Interest Payment Date. The Adjusted CD Rate for each Interest Period
shall be determined by the Administrative Agent, and such determination shall
be conclusive absent manifest error. The Administrative Agent shall promptly
advise the Borrower and each Lender, as appropriate, of such determination.
(c) Subject to the provisions of Section 2.09, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 365 or 366 days, as the case may be, when
determined by reference to the Prime Rate and over a year of 360 days at all
other times) at a rate per annum equal to the Alternate Base Rate. Interest on
each ABR Borrowing shall be payable on each applicable Interest Payment Date.
The Alternate Base Rate shall be determined by the Administrative Agent, and
such determination shall be conclusive absent manifest error.
(d) Subject to the provisions of Section 2.09, each Fixed Rate Loan
shall bear interest at a rate per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days) equal to the fixed rate of
interest offered by the Lender making such Loan and accepted by the Borrower
pursuant to Section 2.03. Interest on each Fixed Rate Loan shall be payable on
each applicable Interest Payment Date.
SECTION 2.09. DEFAULT INTEREST. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount
becoming due hereunder, whether by scheduled maturity, notice of prepayment,
acceleration or otherwise, the Borrower shall on demand from time to time from
the Administrative Agent pay interest, to the extent permitted by law, on such
defaulted amount up to (but not including) the date of actual payment (after as
well as before judgment) at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days, as the case may
be, when determined by reference to the Prime Rate and over a year of 360 days
at all other times) equal to the Alternate Base Rate plus, at all times after
the Administrative Agent shall have notified the Borrower that default interest
will be charged, 2%.
SECTION 2.10. ALTERNATE RATE OF INTEREST. (a) In the event, and on
each occasion, that on the day two Business Days prior to the commencement of
any Interest Period for a Eurodollar Borrowing (i) the Administrative Agent
shall have determined, based upon communications with the Reference Banks, that
dollar deposits in the principal amounts of the Eurodollar Loans comprising
such Borrowing are not generally available in the London interbank market, or
that reasonable means do not exist for ascertaining the LIBO Rate, or (ii) the
Required Lenders shall have determined and shall have notified the
Administrative Agent that the rates at which such dollar deposits are being
offered by the Reference Banks will not adequately and fairly reflect the cost
to such Lenders of making or maintaining Eurodollar Loans during such Interest
Period, the Administrative Agent shall, as soon as practicable thereafter, give
written or telecopy notice of such determination to the Borrower and the
Lenders. In the event of any such determination, until the Administrative Agent
shall have advised the Borrower and the Lenders that the circumstances giving
rise to such notice no longer exist, (i) any request by the Borrower for a
Eurodollar Competitive Borrowing pursuant to Section 2.03 to be made after such
determination shall be of no force and effect and shall be denied by the
Administrative Agent and (ii) any request by the Borrower for a Eurodollar
Standby Borrowing pursuant to Section 2.04 to be made after such determination
shall be deemed to be a request for an ABR Borrowing. Also, in the event of any
such determination, the Borrower shall be entitled, in its sole discretion, if
the requested Borrowing has not been made, to cancel its acceptance of the
Competitive Bids or to cancel its Standby Borrowing Request relating thereto,
subject
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to Section 2.15. Each determination by the Administrative Agent or the
Required Lenders hereunder shall be conclusive absent manifest error.
(b) In the event, and on each occasion, that on or before the day on
which the Adjusted CD Rate for an Interest Period in respect of a CD Borrowing
is to be determined (i) the Administrative Agent shall have determined, based
upon communications with the Reference Banks, that such Adjusted CD Rate cannot
be determined for any reason, including the inability of the Administrative
Agent to obtain sufficient bids in accordance with the terms of the definition
of Fixed CD Rate, or (ii) the Required Lenders shall have determined and shall
have notified the Administrative Agent that the Adjusted CD Rate for such
CD Borrowing will not adequately and fairly reflect the cost to such Lenders of
making or maintaining CD Loans during such Interest Period, the Administrative
Agent shall, as soon as practicable thereafter, give written or telecopy notice
of such determination to the Borrower and the Lenders. In the event of any such
determination, any request by the Borrower for a CD Borrowing pursuant to
Section 2.04 to be made after such determination shall, until the
Administrative Agent shall have advised the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, be deemed to be a
request for an ABR Borrowing. Also, in the event of any such determination, the
Borrower shall be entitled, in its sole discretion, if the requested Borrowing
has not been made, to cancel its Standby Borrowing Request relating thereto,
subject to Section 2.15. Each determination by the Administrative Agent or the
Required Lenders hereunder shall be conclusive absent manifest error.
SECTION 2.11. TERMINATION AND REDUCTION OF COMMITMENTS. (a) The
Commitments shall be automatically terminated on the Maturity Date.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Standby Commitments; PROVIDED, HOWEVER, that (i) each partial reduction of
the Standby Commitments shall be in an integral multiple of $50,000,000 and in
a minimum principal amount of $100,000,000 and (ii) no such termination or
reduction shall be made which would reduce the Standby Commitments to an amount
less than the aggregate outstanding principal amount of the Competitive Loans.
The Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.11(b).
(c) Except as otherwise provided in Section 2.21, each reduction in
the Standby Commitments hereunder shall be made ratably among the Lenders in
accordance with their respective Standby Commitments. The Borrower agrees to
pay to the Administrative Agent for the account of the Lenders, on the date of
termination of the Standby Commitments, the Facility Fees on the amount of the
Standby Commitments so terminated accrued through the date of such termination.
SECTION 2.12. PREPAYMENT. (a) The Borrower shall have the right at any
time and from time to time to prepay any Standby Borrowing, in whole or in
part, upon giving written or telecopy notice (or telephone notice promptly
confirmed by written or telecopy notice) to the Administrative Agent: (i)
before 10:00 a.m., New York City time, three Business Days prior to prepayment,
in the case of Eurodollar Loans, (ii) before 10:00 a.m., New York City time,
two Business Days prior to prepayment, in the case of CD Loans, and (iii)
before 10:00 a.m., New York City time, one Business Day prior to prepayment, in
the case of ABR Loans; PROVIDED, HOWEVER, that each partial prepayment shall be
in an amount which is an integral multiple of $1,000,000 and not less than
$5,000,000. The Administrative Agent shall promptly advise the Lenders of any
notice given pursuant to this Section 2.12(a). The Borrower shall not have
the right to prepay any Competitive Borrowing without the consent of the
affected Lender or Lenders.
(b) On the date of any termination or reduction of the Standby
Commitments pursuant to Section 2.11 or Section 2.21, the Borrower shall pay or
prepay as much of the Standby Borrowings and
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23
Swingline Loans as shall be necessary in order that the sum of the aggregate
principal amount of the Competitive Loans, Swingline Loans and Standby Loans
outstanding will not exceed the Total Commitment after giving effect to such
termination or reduction.
(c) Each notice of prepayment shall specify the prepayment date and
the principal amount of each Borrowing (or portion thereof) to be prepaid,
shall be irrevocable and shall commit the Borrower to prepay such Borrowing (or
portion thereof) by the amount stated therein on the date stated therein. All
prepayments under this Section 2.12 shall be subject to Section 2.15 but
otherwise without premium or penalty. All prepayments under this Section 2.12
shall be accompanied by accrued interest on the principal amount being prepaid
to the date of payment.
SECTION 2.13. RESERVE REQUIREMENTS; CHANGE IN CIRCUMSTANCES. (a)
Notwithstanding any other provision herein, if after the date of this Agreement
any change in applicable law or regulation (including any change in the reserve
percentages provided for in Regulation D) or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof shall change the basis of taxation of
payments to any Lender of the principal of or interest on any Eurodollar Loan,
CD Loan or Fixed Rate Loan made by such Lender (other than changes in respect
of taxes imposed on the overall net income of such Lender by the jurisdiction
in which such Lender has its principal office (or in which it holds any
Eurodollar Loan, CD Loan or Fixed Rate Loan) or by any political subdivision or
taxing authority therein and other than taxes that would not have been imposed
but for the failure of such Lender to comply with applicable certification,
information, documentation or other reporting requirements), or shall impose,
modify or deem applicable any reserve, special deposit or similar requirement
against assets of or deposits with or for the account of such Lender (except
any such reserve requirement which is reflected in the Adjusted CD Rate), or
shall impose on such Lender or the London interbank market any other condition
affecting this Agreement or any Eurodollar Loan, CD Loan or Fixed Rate Loan
made by such Lender, and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Loan,
CD Loan or Fixed Rate Loan or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise) in respect of any Eurodollar Loan, CD Loan or Fixed Rate Loan by an
amount deemed by such Lender to be material, then the Borrower agrees to pay to
such Lender as provided in paragraph (c) below such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered. Notwithstanding the foregoing, no Lender shall be entitled
to request compensation under this paragraph with respect to any Competitive
Loan if the change giving rise to such request shall, or in good faith should,
have been taken into account in formulating the Competitive Bid pursuant to
which such Competitive Loan shall have been made.
(b) If any Lender shall have determined that the adoption after the
date hereof of any law, rule, regulation or guideline regarding capital
adequacy, or any change in any law, rule, regulation or guideline regarding
capital adequacy or in the interpretation or administration of any of the
foregoing by any governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Lender (or any lending office of such Lender) or any Lender's holding company
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Lender's
capital or on the capital of such Lender's holding company, if any, as a
consequence of this Agreement or the Loans made by such Lender pursuant hereto
to a level below that which such Lender or such Lender's holding company could
have achieved but for such applicability, adoption, change or compliance
(taking into consideration such Lender's policies and the policies of such
Lender's holding company with respect to capital adequacy) by an amount deemed
by such Lender to be material, then from time to time the Borrower agrees to
pay to such Lender as provided in paragraph (c) below such additional amount or
amounts as will compensate such Lender or such Lender's holding company for any
such reduction suffered. It is acknowledged and agreed that the Facility Fee
provided for in this Agreement has been determined on the understanding that
the Lenders will not be
<PAGE> 28
24
required to maintain capital against their Commitments under current
applicable laws, rules, regulations and regulatory guidelines. In the event
the Lenders shall be advised by bank regulatory authorities responsible for
interpreting or administering such applicable laws, rules, regulations and
guidelines or shall otherwise determine, on the basis of applicable laws,
rules, regulations, guidelines or other requests or statements (whether or
not having the force of law) of such bank regulatory authorities, that such
understanding is incorrect, it is agreed that the Lenders will be entitled
to make claims under this paragraph based upon prevailing market requirements
for commitments under comparable credit facilities against which capital is
required to be maintained; provided that no claim based solely on this
sentence shall result in a Lender receiving a Facility Fee for any period
based on a rate per annum in excess of that for the facility fee applicable to
such period under the Facility B Credit Agreement.
(c) A certificate of each Lender setting forth such amount or amounts
as shall be necessary to compensate such Lender as specified in paragraph (a)
or (b) above, as the case may be, and the basis therefor in reasonable detail
shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay each Lender the amount shown as due on any such
certificate within 30 days after its receipt of the same. Upon the receipt of
any such certificate, the Borrower shall be entitled, in its sole discretion,
if any requested Loan has not been made, to cancel its acceptance of the
relevant Competitive Bids or to cancel the Standby Borrowing Request relating
thereto, subject to Section 2.15.
(d) Except as provided in this paragraph, failure on the part of any
Lender to demand compensation for any increased costs or reduction in amounts
received or receivable or reduction in return on capital with respect to any
period shall not constitute a waiver of such Lender's right to demand
compensation with respect to any other period. The protection of this Section
shall be available to each Lender regardless of any possible contention of the
invalidity or inapplicability of the law, rule, regulation, guideline or other
change or condition which shall have occurred or been imposed so long as it
shall be customary for Lenders affected thereby to comply therewith. No Lender
shall be entitled to compensation under this Section 2.13 for any costs
incurred or reductions suffered with respect to any date unless it shall have
notified the Borrower that it will demand compensation for such costs or
reductions under paragraph (c) above not more than 90 days after the later of
(i) such date and (ii) the date on which it shall have become aware of such
costs or reductions. Notwithstanding any other provision of this Section 2.13,
no Lender shall demand compensation for any increased cost or reduction
referred to above if it shall not at the time be the general policy or practice
of such Lender to demand such compensation in similar circumstances under
comparable provisions of other credit agreements, if any. In the event the
Borrower shall reimburse any Lender pursuant to this Section 2.13 for any cost
and such Lender shall subsequently receive a refund in respect thereof, such
Lender shall so notify the Borrower and, upon its request, will pay to the
Borrower the portion of such refund which such Lender shall determine in good
faith to be allocable to the cost so reimbursed.
SECTION 2.14. CHANGE IN LEGALITY. (a) Notwithstanding any other
provision herein, if any change in any law or regulation or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurodollar Loan, then, by written
notice to the Borrower and to the Administrative Agent, such Lender may:
(i) declare that Eurodollar Standby Loans will not thereafter
be made by such Lender hereunder, whereupon such Lender shall not
submit a Competitive Bid in response to a request for Eurodollar
Competitive Loans and any request by the Borrower for a Eurodollar
Standby Borrowing shall, as to such Lender only, be deemed a request
for an ABR Loan unless such declaration shall be subsequently
withdrawn; PROVIDED, HOWEVER, the Borrower shall be entitled, in its
sole discretion, if the requested Borrowing has not been made, to
cancel its acceptance of the relevant Competitive Bids or to cancel
its Standby Borrowing Request relating thereto, subject to Section
2.15; and
<PAGE> 29
25
(ii) require that all outstanding Eurodollar Standby Loans
made by it be converted to ABR Loans, in which event all such
Eurodollar Standby Loans shall be automatically converted to ABR Loans
as of the effective date of such notice as provided in paragraph (b)
below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal which would otherwise have been applied
to repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.14, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan, if lawful, on the last
day of the Interest Period currently applicable to such Eurodollar Loan; in all
other cases such notice shall be effective on the date of receipt by the
Borrower.
SECTION 2.15. INDEMNITY. The Borrower agrees to indemnify each Lender
against any loss or expense described below which such Lender may sustain or
incur as a consequence of (a) any failure by the Borrower to fulfill on the
date of any borrowing hereunder the applicable conditions set forth in Article
IV, (b) any failure by the Borrower to borrow any Loan hereunder after
irrevocable notice of such borrowing has been given or deemed given or
Competitive Bids have been accepted pursuant to this Article II or (c) any
payment, prepayment or conversion of a Eurodollar Loan, CD Loan or Fixed Rate
Loan required by any other provision of this Agreement or otherwise made or
deemed made, whatever the circumstances may be that give rise to such payment,
prepayment or conversion, or any transfer of any such Loan pursuant to Section
2.21 or 9.16(b), on a date other than the last day of the Interest Period
applicable thereto. The loss or expense for which such Lender shall be
indemnified under this Section 2.15 shall be equal to the excess, if any, as
reasonably determined by such Lender, of (i) its cost of obtaining the funds
for the Loan being paid, prepaid, converted or not borrowed (assumed to be the
LIBO Rate or Adjusted CD Rate or, in the case of a Fixed Rate Loan, the fixed
rate of interest applicable thereto) for the period from the date of such
payment, prepayment, conversion or failure to borrow to the last day of the
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for such Loan which would have commenced on the date of such
failure) over (ii) the amount of interest (as reasonably determined by such
Lender) that would be realized by such Lender in reemploying the funds so paid,
prepaid, converted or not borrowed for such period or Interest Period, as the
case may be; PROVIDED, HOWEVER, that such amount shall not include any loss of
a Lender's margin or spread over its cost of obtaining funds as described
above. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. This covenant
shall survive the termination of this Agreement and the payment of the Loans
and all other amounts payable hereunder.
SECTION 2.16. PRO RATA TREATMENT. Except as required under Section
2.14 or 2.21, each Standby Borrowing, each payment or prepayment of principal
of any Standby Borrowing, each payment of interest on the Standby Loans, each
payment of the Facility Fees, each reduction of the Standby Commitments and
each refinancing of any Borrowing with a Standby Borrowing of any Type, shall
be allocated pro rata among the Lenders in accordance with their respective
Standby Commitments (or, if such Commitments shall have expired or been
terminated, in accordance with the respective principal amounts of their
outstanding Standby Loans). Each payment of principal of any Competitive
Borrowing shall be allocated pro rata among the Lenders participating in such
Borrowing in accordance with the respective principal amounts of their
outstanding Competitive Loans comprising such Borrowing. Each payment of
interest on any Competitive Borrowing shall be allocated pro rata among the
Lenders participating in such Borrowing in accordance with the respective
amounts of accrued and unpaid interest on their outstanding Competitive Loans
comprising such Borrowing. For purposes of determining the available
Commitments of the Lenders and the Total Commitment at any time, each
outstanding Competitive Borrowing shall be deemed to have
<PAGE> 30
26
utilized the Standby Commitments of the Lenders (including those Lenders
which shall not have made Loans as part of such Competitive Borrowing) pro
rata in accordance with such respective Commitments and to have utilized the
Total Commitment by the amount of such Competitive Borrowing. Each Lender
agrees that in computing such Lender's portion of any Borrowing to be made
hereunder, the Administrative Agent may, in its discretion, round such Lender's
percentage of such Borrowing to the next higher or lower whole dollar amount.
SECTION 2.17. SHARING OF SETOFFS. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrower, or pursuant to a secured claim under Section 506 of Title
11 of the United States Code or other security or interest arising from, or in
lieu of, such secured claim, received by such Lender under any applicable
bankruptcy, insolvency or other similar law or otherwise, or by any other
means (other than pursuant to any provision of this Agreement), obtain
payment (voluntary or involuntary) in respect of any Standby Loan or Loans as
a result of which the unpaid principal portion of the Standby Loans shall be
proportionately less than the unpaid principal portion of the Standby Loans
of any other Lender, it shall be deemed simultaneously to have purchased from
such other Lender at face value, and shall promptly pay to such other Lender
the purchase price for, a participation in the Standby Loans of such other
Lender, so that the aggregate unpaid principal amount of the Standby Loans
and participations in the Standby Loans held by each Lender shall be in the
same proportion to the aggregate unpaid principal amount of all Standby Loans
then outstanding as the principal amount of its Standby Loans prior to such
exercise of banker's lien, setoff or counterclaim or other event was to the
principal amount of all Standby Loans outstanding prior to such exercise of
banker's lien, setoff or counterclaim or other event; PROVIDED, HOWEVER,
that, if any such purchase or purchases or adjustments shall be made pursuant
to this Section 2.17 and the payment giving rise thereto shall thereafter
be recovered, such purchase or purchases or adjustments shall be rescinded
to the extent of such recovery and the purchase price or prices or adjustment
restored without interest. The Borrower expressly consents to the foregoing
arrangements and agrees that any Lender holding a participation in a Standby
Loan deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys
owing by the Borrower to such Lender by reason thereof as fully as if such
Lender had made a Standby Loan directly to the Borrower in the amount of such
participation.
SECTION 2.18. PAYMENTS. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder and under any other Loan Document not later than 12:00
(noon), New York City time, on the date when due in dollars to the
Administrative Agent at its offices at 270 Park Avenue, New York, New York, in
immediately available funds.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.19. [Intentionally Omitted]
SECTION 2.20. TAXES. (a) Any and all payments by the Borrower
hereunder to or for the benefit of a non-U.S. Person shall be made, in
accordance with Section 2.18, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto imposed by or on behalf
of the United States or any political subdivision thereof, EXCLUDING taxes
imposed on (or measured by) such non-U.S. Person's (including any transferee's
or assignee's (any such entity a "TRANSFEREE")) net income or net receipts,
franchise taxes, taxes on doing business or taxes imposed on capital or net
worth (all such nonexcluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "TAXES"). If the
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder to a non-U.S.
<PAGE> 31
27
Person, (i) the sum payable shall be increased by the amount necessary so
that after making all required deductions (including deductions applicable
to additional sums payable under this Section 2.20) such non-U.S. Person
shall receive an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxing
authority or other Governmental Authority in accordance with applicable law.
(b) The Borrower agrees to pay and reimburse on demand all transfer,
stamp, documentary or other similar taxes, assessments or charges levied by any
Governmental Authority in respect of this Agreement or any of the Loans (all
such taxes, assessments or charges hereinafter referred to as "OTHER TAXES").
(c) The Borrower will indemnify each Lender (or Transferee) and the
Administrative Agent for the full amount of Taxes and Other Taxes (including
any Taxes or Other Taxes imposed by the applicable jurisdiction on amounts
payable under this Section 2.20) paid by such Lender (or Transferee) or the
Administrative Agent, as the case may be, and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted
by the relevant taxing authority or other Governmental Authority. Such
indemnification shall be made within 30 days after the date such Lender
(or Transferee) or the Administrative Agent, as the case may be, makes
written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes withheld by the Borrower in respect of any payment to a non- U.S. Person,
the Borrower will furnish to the Administrative Agent, at its address referred
to in Section 8.01 for delivery to such non-U.S. Person, the original or a
certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section 2.20 shall
survive the payment in full of the principal of and interest on all Loans made
hereunder and of all other amounts payable hereunder.
(f) Each Lender (or Transferee) which is organized outside the United
States shall, if legally able to do so, upon written request of the Borrower,
deliver to the Borrower such certificates, documents or other evidence, as
required by the Code or Treasury Regulations issued pursuant thereto, including
Internal Revenue Service Form 1001 or Form 4224 or any subsequent version
thereof, properly completed and duly executed by such Lender (or Transferee)
establishing that payments of interest are (i) not subject to withholding under
the Code because such interest income is effectively connected with the conduct
by such Lender (or Transferee) of a trade or business in the United States or
(ii) exempt from United States tax under a provision of an applicable tax
treaty. Unless the Borrower and the Administrative Agent have received forms or
other documents satisfactory to them indicating that payments hereunder are not
subject to United States withholding tax, the Borrower or the Administrative
Agent shall withhold taxes from such payments at the applicable statutory rate
in the case of payments of interest to or for any Lender (or Transferee) or
assignee that is a non-U.S. Person.
(g) The Borrower shall not be required to pay any additional amounts
to any non-U.S. Person in respect of United States withholding tax pursuant to
paragraph (a) above (i) if the obligation to pay such additional amounts would
not have arisen but for a failure by such non-U.S. Person to comply with the
provisions of paragraph (f) above or (ii) in the case of a Transferee, to the
extent such additional amounts exceed the additional amounts that would have
been payable had no transfer or assignment to such Transferee occurred;
PROVIDED, HOWEVER, the Borrower shall be required to pay those amounts to any
Lender (or Transferee) that it was required to pay hereunder prior to the
failure of such Lender (or Transferee) to comply with the provisions of such
paragraph (f).
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SECTION 2.21. TERMINATION OR ASSIGNMENT OF COMMITMENTS UNDER CERTAIN
CIRCUMSTANCES. (a) Any Lender (or Transferee) claiming any additional amounts
payable pursuant to Section 2.13 or Section 2.20 or exercising its rights under
Section 2.14 shall use reasonable efforts (consistent with legal and regulatory
restrictions) to file any certificate or document requested by the Borrower or
to change the jurisdiction of its applicable lending office if the making of
such a filing or change would avoid the need for or reduce the amount of any
such additional amounts which may thereafter accrue or avoid the circumstances
giving rise to such exercise and would not, in the sole determination of such
Lender, be otherwise disadvantageous to such Lender (or Transferee).
(b) In the event that any Lender shall have delivered a notice or
certificate pursuant to Section 2.13 or 2.14, or the Borrower shall be required
to make additional payments to any Lender under Section 2.20, the Borrower
shall have the right, at its own expense, upon notice to such Lender and the
Administrative Agent, (a) to terminate the Commitments of such Lender or (b) to
require such Lender to transfer and assign without recourse (in accordance with
and subject to the restrictions contained in Section 8.04) all its interests,
rights and obligations under this Agreement to another financial institution
acceptable to the Administrative Agent (which approval shall not be
unreasonably withheld) which shall assume such obligations; PROVIDED that (i)
no such termination or assignment shall conflict with any law, rule or
regulation or order of any Governmental Authority, (ii) the Borrower or the
assignee, as the case may be, shall pay to the affected Lender in immediately
available funds on the date of such termination or assignment the principal of
and interest accrued to the date of payment on the Loans made by it hereunder
and all other amounts accrued for its account or owed to it hereunder and (iii)
the Borrower shall not terminate Commitments representing more than 10% of the
original Total Commitment pursuant to this paragraph (b).
SECTION 2.22. SWINGLINE LOANS. (a) On the terms, subject to the
conditions and relying upon the representations and warranties herein set
forth, each Swingline Lender agrees, severally and not jointly, at any time and
from time to time on and after the date hereof and until the earlier of the
Business Day immediately preceding the Maturity Date and the termination of the
Swingline Commitment of such Swingline Lender, to make Swingline Loans to the
Borrower in an aggregate principal amount not to exceed such Swingline Lender's
Swingline Percentage of the lesser of (i) the difference between (A) the
aggregate Swingline Commitments and (B) the aggregate Swingline Exposures
immediately prior to the making of such Swingline Loans and (ii) the difference
between (A) the Total Commitment and (B) the outstanding aggregate principal
amount of all Loans immediately prior to the making of such Swingline Loans at
such time; PROVIDED that the sum of the aggregate Swingline Exposures and the
aggregate Swingline Exposures (as defined in the Facility B Credit Agreement)
shall not exceed the lesser of (i) the sum of (x) the aggregate Swingline
Commitments and (y) the aggregate Swingline Commitments (as defined in the
Facility B Credit Agreement ) and (ii) $1,000,000,000. Each Swingline Loan
shall be made as part of a Borrowing consisting of Swingline Loans made by the
Swingline Lenders ratably in accordance with their respective Swingline
Percentages (it being understood that (I) the failure of any Swingline Lender
to make any Swingline Loan shall not in itself relieve any other Swingline
Lender of its obligation to lend hereunder and (II) no Swingline Lender shall
be responsible for the failure of any other Swingline Lender to make any
Swingline Loan required to be made by such other Swingline Lender). The
Swingline Loans comprising any Swingline Borrowing shall be in an aggregate
principal amount that is an integral multiple of $1,000,000 and not less than
$5,000,000 (or an aggregate principal amount equal to the remaining balance of
the available Swingline Commitments). Each Swingline Lender shall make its
portion of each Swingline Borrowing available to the Borrower by means of a
credit to the general deposit account of the Borrower with the Administrative
Agent or a wire transfer, at the expense of the Borrower, to an account
designated in writing by the Borrower, in each case by 3:30 p.m., New York City
time, on the date such Swingline Borrowing is requested to be made pursuant to
paragraph (b) below, in immediately available funds. Within the limits set
forth in the first sentence of this paragraph, the Borrower may borrow, pay or
prepay and reborrow Swingline Loans on or after the date hereof and prior to
the Maturity Date on the terms and subject to the conditions and limitations
set forth herein.
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(b) The Borrower shall give the Administrative Agent telephonic,
written or telecopy notice substantially in the form of Exhibit G (in the case
of telephonic notice, such notice shall be promptly confirmed by telecopy) no
later than 2:30 p.m., New York City time, on the day of a proposed Swingline
Borrowing. Such notice shall be delivered on a Business Day, shall be
irrevocable and shall refer to this Agreement and shall specify the requested
date (which shall be a Business Day) and amount of such Swingline Borrowing.
The Administrative Agent shall promptly advise the Swingline Lenders of any
notice received from the Borrower pursuant to this paragraph (b).
(c) If the Borrower does not fully repay a Swingline Borrowing on or
prior to the last day of the Interest Period with respect thereto, the
Administrative Agent shall promptly notify each Lender thereof (by telecopy or
by telephone, confirmed in writing) and of its Applicable Percentage of such
Swingline Borrowing. Upon such notice but without any further action, each
Swingline Lender hereby agrees to grant to each Lender, and each Lender hereby
agrees to acquire from each Swingline Lender, a participation in such Swingline
Loan made by such Swingline Lender as part of such defaulted Swingline
Borrowing equal to such Lender's Applicable Percentage of the principal amount
of such Swingline Loan. In consideration and in furtherance of the foregoing,
each Lender hereby absolutely and unconditionally agrees, upon receipt of
notice as provided above, to pay to the Administrative Agent, for the account
of the applicable Swingline Lender, such Lender's Applicable Percentage of each
Swingline Borrowing (including the interest accrued thereon) that is not repaid
on the last day of the Interest Period with respect thereto. Each such payment
shall, for all purposes hereof, be deemed to be an ABR Loan to which, after the
first day thereof, default interest will apply. Each Lender acknowledges and
agrees that its obligation to acquire participations in such Swingline Loans
pursuant to this paragraph is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including the occurrence and
continuance of a Default or the failure of any condition precedent set forth in
Article IV, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Lender shall comply with
its obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.02(c) with respect to Loans
made by such Lender, and the Administrative Agent shall promptly pay to the
Swingline Lenders their respective shares of the amounts so received by it from
the Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph.
Notwithstanding anything herein to the contrary, the purchase of participations
in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower
of its default in respect of the payment thereof so long as ABR Loans that
resulted from any such default shall remain outstanding or any accrued interest
thereon shall remain unpaid.
(d) Upon written or telecopy notice to the Swingline Lenders and to
the Administrative Agent, the Borrower may at any time permanently terminate,
or from time to time in part permanently reduce, the Swingline Commitments of
the Swingline Lenders. Each reduction of the Swingline Commitments shall be
allocated pro rata among the Swingline Lenders in accordance with their
respective Swingline Percentages. On the date of any termination or reduction
of the Swingline Commitments pursuant to this paragraph (d), the Borrower shall
pay or prepay so much of the Swingline Borrowings as shall be necessary in
order that the aggregate outstanding principal amount of Swingline Loans will
not exceed the aggregate Swingline Commitments after giving effect to such
termination or reduction.
(e) The Borrower may prepay any Swingline Borrowing in whole or in
part at any time without premium or penalty; PROVIDED that the Borrower shall
have given the Administrative Agent written or telecopy notice (or telephone
notice promptly confirmed in writing or by telecopy) of such prepayment not
later than 10:30 a.m., New York City time, on the Business Day designated by
the Borrower for such prepayment; and PROVIDED FURTHER that each partial
payment shall be in an amount that is an integral multiple of $1,000,000. Each
notice of prepayment under this paragraph (e) shall specify the prepayment date
and the principal amount of each Swingline Borrowing (or portion thereof) to be
prepaid, shall be irrevocable and shall commit the Borrower to prepay such
Swingline Borrowing (or portion thereof) by the amount stated therein on the
date stated therein. All prepayments under this paragraph (e) shall be
<PAGE> 34
30
accompanied by accrued interest on the principal amount being prepaid to the
date of payment. Each payment of principal of or interest on or any other
amount in respect of Swingline Loans shall be allocated, as between the
Swingline Lenders, pro rata in accordance with their respective Swingline
Percentages.
ARTICLE III. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders that:
SECTION 3.01. CORPORATE EXISTENCE. The Borrower and each Material
Subsidiary: (a) is a corporation, partnership or other entity duly organized
and validly existing under the laws of the jurisdiction of its organization;
(b) has all requisite corporate or other power, and has all material
governmental licenses, authorizations, consents and approvals, necessary to own
its assets and carry on its business as now being or as proposed to be
conducted, except where the failure to have any of the foregoing would not
result in a Material Adverse Effect; and (c) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure so to qualify would result in a
Material Adverse Effect.
SECTION 3.02. FINANCIAL CONDITION. (a) Each of (i) the consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as at December
31, 1993, and the related consolidated statements of income and cash flows of
the Borrower and its Consolidated Subsidiaries for the fiscal year ended on
such date, with the opinion thereon of Price Waterhouse, and (ii) the
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
at March 31, 1994, and the related consolidated statements of income and cash
flows of the Borrower and its Consolidated Subsidiaries for the fiscal quarter
ended on such date, all certified by a Financial Officer of the Borrower,
heretofore furnished to each of the Lenders, fairly present the consolidated
financial condition of the Borrower and its Consolidated Subsidiaries as at
such dates and the consolidated results of their operations for the fiscal year
or fiscal quarter ended on such dates in accordance with generally accepted
accounting principles (subject, in the case of the statements referred to in
clause (ii) above, to year-end audit adjustments). Neither the Borrower nor
any of its Material Subsidiaries had on such dates any known material
contingent liability, except as referred to or reflected or provided for in the
Exchange Act Report (as defined in Section 3.03) or in such balance sheet (or
the notes thereto) as at such dates.
(b) There has been no material adverse change in the consolidated
financial condition, operations, assets, business or prospects taken as a whole
of the Borrower and its Consolidated Subsidiaries from that set forth in such
financial statements as at December 31, 1993 (it being agreed, however, that
none of (i) the reduction by any rating agency of any rating assigned to
Indebtedness of the Borrower, (ii) non-cash provisions for loan losses and
additions to valuation allowances, (iii) any change in GAAP or the Borrower's
compliance therewith and (iv) any legal or arbitral proceedings which have been
disclosed in the Exchange Act Report (as defined in Section 3.03), whether
threatened, pending, resulting in a judgment or otherwise, prior to the time a
final judgment for the payment of money shall have been recorded against the
Borrower and/or any of its Material Subsidiaries by any Governmental Authority
having jurisdiction, and the judgment is non-appealable (or the time for appeal
has expired) and all stays of execution have expired or been lifted shall, in
and of itself, constitute such a material adverse change).
SECTION 3.03. LITIGATION. Except as disclosed to the Lenders in the
Exchange Act Report filed prior to the Closing Date or otherwise disclosed in
writing to the Lenders prior to the Closing Date, as of the Closing Date there
are no legal or arbitral proceedings, or any proceedings by or before any
Governmental Authority, pending or (to the knowledge of the Borrower)
threatened against the Borrower or any of its Material Subsidiaries which have
resulted in a Material Adverse Effect. The "EXCHANGE ACT REPORT" shall mean,
collectively, the Annual Report of the Borrower on Form 10-K for the year ended
<PAGE> 35
31
December 31, 1993, each Report on Form 8-K of the Borrower filed subsequent to
December 31, 1993 and prior to the date hereof, and the Report of the Borrower
on Form 10-Q for the Quarter ended March 31, 1994.
SECTION 3.04. NO BREACH. None of the execution and delivery of this
Agreement, the consummation of the transactions herein contemplated and
compliance with the terms and provisions hereof will conflict with or result in
a breach of, or require any consent under, the charter or By-laws of the
Borrower, or any applicable law or regulation, or any order, writ, injunction
or decree of any Governmental Authority, or any material agreement or
instrument to which the Borrower or any of its Material Subsidiaries is a party
or by which any of them is bound or to which any of them is subject, or
constitute a default under any such agreement or instrument, or result in the
creation or imposition of any Lien upon any of the revenues or assets of the
Borrower or any of its Material Subsidiaries pursuant to the terms of any such
agreement or instrument.
SECTION 3.05. CORPORATE ACTION. The Borrower has all necessary
corporate power and authority to execute, deliver and perform its obligations
under this Agreement; the execution, delivery and performance by the Borrower
of this Agreement have been duly authorized by all necessary corporate action
on its part; and this Agreement has been duly and validly executed and
delivered by the Borrower and constitutes, its legal, valid and binding
obligation, enforceable in accordance with its terms except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or similar laws of general applicability
affecting the enforcement of creditors' rights and (b) the application of
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
SECTION 3.06. APPROVALS. No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority are necessary
for the execution, delivery or performance by the Borrower of this Agreement or
for the validity or enforceability hereof.
SECTION 3.07. USE OF LOANS. Neither the Borrower nor any of its
Subsidiaries is engaged principally in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or carrying
Margin Stock and no part of the proceeds of any Loan hereunder will be used to
buy or carry any Margin Stock in violation of Regulation G or U.
SECTION 3.08. ERISA. The Borrower and, to the best of its knowledge,
its ERISA Affiliates have fulfilled their respective obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code except where any failure or non-compliance
would not result in a Material Adverse Effect.
SECTION 3.09. TAXES. United States Federal income tax returns of the
Borrower and its Material Subsidiaries have been examined and closed through
the fiscal year of the Borrower ended December 31, 1986. The Borrower and its
Material Subsidiaries have filed all United States Federal income tax returns
and all other material tax returns which are required to be filed by them and
have paid all taxes shown as due on such returns or pursuant to any assessment
received by the Borrower or any of its Material Subsidiaries, except those
being contested and reserved against in accordance with Section 5.03.
SECTION 3.10. INVESTMENT COMPANY ACT. The Borrower is not an
"INVESTMENT COMPANY", or a company "CONTROLLED" by an "INVESTMENT COMPANY",
within the meaning of the Investment Company Act of 1940, as amended.
<PAGE> 36
32
SECTION 3.11. PUBLIC UTILITY HOLDING COMPANY ACT. The Borrower is not
subject to regulation as a "HOLDING COMPANY", subject to regulation as an
"AFFILIATE" of a "HOLDING COMPANY", or subject to regulation as a "SUBSIDIARY
COMPANY" of a "HOLDING COMPANY", under the Public Utility Holding Company Act
of 1935, as amended.
SECTION 3.12. HAZARDOUS MATERIALS. The Borrower and each of its
Subsidiaries have obtained all permits, licenses and other authorizations which
are required under all Environmental Laws, except to the extent failure to have
any such permit, license or authorization has not resulted in a Material
Adverse Effect. The Borrower and each of its Subsidiaries are in compliance
with the terms and conditions of all such permits, licenses and authorizations,
and are also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law or in any regulation,
code, plan, order, decree, judgment, injunction, notice or demand letter
issued, entered, promulgated or approved thereunder, except to the extent
failure to comply would not result in a Material Adverse Effect.
SECTION 3.13. MATERIAL SUBSIDIARIES, ETC. Set forth in Schedule 3.13
is a complete and correct list, as of the Closing Date, of all Material
Subsidiaries of the Borrower.
SECTION 3.14. NO MATERIAL MISSTATEMENTS. No written information,
report, financial statement, exhibit or schedule (the "INFORMATION") furnished
by or on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of any Loan Document or the facility
contemplated thereby or included therein or delivered pursuant thereto
contained as of the time it was furnished any material misstatement of fact or
omitted as of such time to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were,
are or will be made, not misleading; PROVIDED that, with respect to Information
consisting of statements, estimates and projections regarding the future
performance of the Borrower and its Subsidiaries ("PROJECTIONS"), no
representation or warranty is made other than that such Projections have been
prepared in good faith utilizing due and careful consideration and the best
information available to the Borrower at the time of preparation thereof.
ARTICLE IV. CONDITIONS OF EFFECTIVENESS AND LENDING
The obligations of the Lenders to make Loans hereunder are subject to
the satisfaction of the conditions set forth in Sections 4.01 and 4.02 below.
SECTION 4.01. INITIAL CREDIT EVENT. The obligation of each Lender to
make its initial Loan is subject to the satisfaction of the following
conditions:
(a) The Administrative Agent shall have received a favorable written
opinion of Louis J. Briskman, Esq., Senior Vice President and General Counsel
of the Borrower, to the effect set forth in Exhibit F, dated the Closing Date
and addressed to the Lenders.
(b) All legal matters incident to this Agreement and the borrowings
hereunder shall be satisfactory to the Lenders and their counsel and to
Cravath, Swaine & Moore, counsel for the Administrative Agent.
(c) The Administrative Agent shall have received (i) a copy of the
articles of incorporation, including all amendments thereto, of the Borrower,
certified as of a recent date by the Secretary of State of the Commonwealth of
Pennsylvania, and a certificate as to the good standing of the Borrower as of a
recent date, from such Secretary of State; (ii) a certificate of the Secretary
or Assistant Secretary of the Borrower dated the Closing Date and certifying
(A) that attached thereto is a true and complete copy of the by-laws of the
Borrower as in effect on the Closing Date and at all times since a date prior
to the date
<PAGE> 37
33
of the resolutions described in clause (B) below, (B) that attached thereto
is a true and complete copy of resolutions duly adopted by the Board of
Directors of the Borrower authorizing the execution, delivery and performance
of the Loan Documents and the borrowings hereunder, and that such resolutions
have not been modified, rescinded or amended and are in full force and effect,
(C) that the articles of incorporation of the Borrower have not been amended
since the date of the last amendment thereto shown on the certificate of good
standing furnished pursuant to clause (i) above, and (D) as to the incumbency
and specimen signature of each officer executing any Loan Document or any other
document delivered in connection herewith on behalf of the Borrower; (iii) a
certificate of another officer as to the incumbency and specimen signature of
the Secretary or Assistant Secretary executing the certificate pursuant to (ii)
above; and (iv) such other documents as the Lenders or their counsel or
Cravath, Swaine & Moore, counsel for the Administrative Agent, may reasonably
request.
(d) The Administrative Agent shall have received a certificate from
the Borrower, dated the Closing Date and signed by a Financial Officer of the
Borrower, confirming compliance with the conditions precedent set forth in
paragraphs (b) and (c) of Section 4.02.
(e) The commitments under the Existing Credit Agreement shall have
been permanently terminated and all loans and other obligations under or in
connection therewith shall have been paid in full or shall be paid in full with
the proceeds of the initial borrowings hereunder and under the Facility B
Credit Agreement.
(f) The Administrative Agent shall have received on behalf of itself
and the Lenders entitled thereto all fees due and payable on or prior to the
date of this Agreement under the Fee Letters.
SECTION 4.02. ALL CREDIT EVENTS. The obligation of each Lender to make
each Loan are subject to the satisfaction of the following conditions:
(a) The Administrative Agent shall have received a request
for, or notice of, such Credit Event if and as required by Section
2.03, Section 2.04 or Section 2.22, as applicable.
(b) The representations and warranties set forth in Article
III (except, in the case of a refinancing of a Borrowing with a new
Borrowing that does not increase the aggregate principal amount of the
Loans of any Lender outstanding, the representations set forth in
Section 3.02(b) and 3.12) shall be true and correct in all material
respects on and as of the date of such Borrowing with the same effect
as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date.
(c) At the time of and immediately after such Borrowing no
Default shall have occurred and be continuing.
Each Credit Event shall be deemed to constitute a representation and warranty
by the Borrower on the date of such Credit Event as to the matters specified in
paragraphs (b) and (c) of this Section 4.02.
<PAGE> 38
34
ARTICLE V. COVENANTS
The Borrower covenants and agrees with each Lender that, as long as
the Commitments shall be in effect or the principal of or interest on any Loan
shall be unpaid, unless the Required Lenders shall otherwise consent in
writing:
SECTION 5.01. FINANCIAL STATEMENTS. The Borrower shall deliver to each
of the Lenders:
(a) within 55 days after the end of each of the first three
quarterly fiscal periods of each fiscal year of the Borrower,
consolidated statements of income and cash flows of the Borrower and
its Consolidated Subsidiaries for such period and for the period from
the beginning of the respective fiscal year to the end of such period,
and the related consolidated balance sheet as at the end of such
period, setting forth in each case in comparative form the
corresponding consolidated figures for the corresponding period in the
preceding fiscal year, accompanied by a certificate of a Financial
Officer of the Borrower which certificate shall state that such
financial statements fairly present the consolidated financial
condition and results of operations of the Borrower and its
Consolidated Subsidiaries in accordance with GAAP as at the end of,
and for, such period, subject to normal year-end audit adjustments
(provided that the requirement herein for the furnishing of such
quarterly financial statements may be fulfilled by providing to the
Lenders the report of the Borrower to the SEC on Form 10-Q for the
applicable quarterly period, accompanied by the officer's certificate
described above);
(b) within 105 days after the end of each fiscal year of the
Borrower, consolidated statements of income and cash flows of the
Borrower and its Consolidated Subsidiaries for such year and the
related consolidated balance sheet as at the end of such year, setting
forth in comparative form the corresponding consolidated figures for
the preceding fiscal year, and accompanied by an opinion thereon
(unqualified as to the scope of the audit) of independent certified
public accountants of recognized national standing, which opinion
shall state that such consolidated financial statements fairly present
the consolidated financial condition and results of operations of
the Borrower and its Consolidated Subsidiaries as at the end of,
and for, such fiscal year (provided that the requirement herein for
the furnishing of annual financial statements may be fulfilled by
providing to the Lenders the report of the Borrower to the SEC on
Form 10-K for the applicable fiscal year);
(c) promptly upon their becoming publicly available, copies of
all registration statements and regular periodic reports (including
without limitation any and all reports on Form 8-K), if any, which the
Borrower or any of its Subsidiaries shall have filed with the SEC or
any national securities exchange;
(d) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports
and proxy statements so mailed;
(e) within 30 days after a Responsible Officer of the Borrower
knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan have
occurred or exist which would reasonably be expected to result in a
Material Adverse Effect, a statement signed by a senior financial
officer of the Borrower setting forth details respecting such event or
condition and the action, if any, which the Borrower or its ERISA
Affiliate proposes to take with respect thereto (and a copy of any
report or notice required
<PAGE> 39
35
to be filed with or given to PBGC by the Borrower or an ERISA
Affiliate with respect to such event or condition):
(i) any reportable event, as defined in Section
4043(b) of ERISA and the regulations issued thereunder, with
respect to a Plan, as to which PBGC has not by regulation
waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event
(provided that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA shall be a
reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code);
(ii) the filing under Section 4041 of ERISA of a
notice of intent to terminate any Plan or the termination of
any Plan;
(iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Borrower or any ERISA Affiliate of a notice
from a Multiemployer Plan that such action has been taken by
PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal by the
Borrower or any ERISA Affiliate under Section 4201 or 4204 of
ERISA from a Multiemployer Plan, or the receipt by the
Borrower or any ERISA Affiliate of notice from a Multiemployer
Plan that it is in reorganization or insolvency pursuant to
Section 4241 or 4245 of ERISA or that it intends to terminate
or has terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against the Borrower or any ERISA
Affiliate to enforce Section 515 of ERISA, which proceeding is
not dismissed within 30 days; and
(vi) a failure to make a required installment or
other payment with respect to a Plan (within the meaning of
Section 412(n) of the Code), in which case the notice required
hereunder shall be provided within 10 days after the due date
for filing notice of such failure with the PBGC;
(f) promptly after a Responsible Officer of the Borrower knows
or has reason to believe that any Default has occurred, a notice of
such Default describing it in reasonable detail and, together with
such notice or as soon thereafter as possible, a description of the
action that the Borrower has taken and proposes to take with respect
thereto;
(g) promptly after a Responsible Officer of the Borrower knows
that any change has occurred in the rating assigned to the Borrower's
Index Debt by any of Moody's, S&P or Fitch, a notice describing such
change; and
(h) promptly from time to time such other information
regarding the financial condition, operations or business of the
Borrower or any of its Subsidiaries (including, without limitation,
any Plan or Multiemployer Plan and any reports or other information
required to be filed under ERISA) as any Lender through the
Administrative Agent may reasonably request.
The Borrower will furnish to the Administrative Agent and each Lender, at the
time it furnishes each set of financial statements pursuant to paragraph (a) or
(b) above, a certificate (which may be a copy in the case of each Lender) of a
Financial Officer of the Borrower (i) to the effect that no Default has
occurred and is continuing (or, if any Default has occurred and is continuing,
describing it in reasonable detail and
<PAGE> 40
36
describing the action that the Borrower has taken and proposes to take with
respect thereto), and (ii) setting forth in reasonable detail the computations
necessary to determine whether the Borrower is in compliance with Sections
5.07, 5.08 and 5.09 as of the end of the respective quarterly fiscal period
or fiscal year.
SECTION 5.02. LITIGATION. The Borrower will promptly give to each
Lender notice of the commencement of all legal or arbitral proceedings, and of
all proceedings by or before any governmental or regulatory authority or
agency, affecting the Borrower or any of its Material Subsidiaries, which would
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.03. CORPORATE EXISTENCE, ETC. The Borrower will, and will
cause each of its Material Subsidiaries to, preserve and maintain its legal
existence and all of its material rights, privileges and franchises (provided
that (i) nothing in this Section 5.03 shall prohibit any transaction expressly
permitted under Section 5.05 and (ii) the Borrower or such Material Subsidiary
shall not be required to preserve or maintain any such right, privilege or
franchise if the board of directors of the Borrower or such Material
Subsidiary, as the case may be, shall determine that the preservation or
maintenance thereof is no longer desirable in the conduct of the business of
the Borrower or such Material Subsidiary, as the case may be); comply with the
requirements of all applicable laws, rules, regulations and orders of
Governmental Authorities if failure to comply with such requirements would
reasonably be expected to result in a Material Adverse Effect; pay and
discharge all material taxes, assessments and governmental charges or levies
imposed on it or on its income or profits or on any of its property prior to
the date on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being contested in good
faith and by proper proceedings and against which adequate reserves are being
maintained; maintain all its property used or useful in its business in good
working order and condition, ordinary wear and tear excepted, all as in the
judgment of the Borrower or such Material Subsidiary may be necessary so that
the business carried on in connection therewith may be properly and
advantageously conducted at all times (provided that the Borrower or such
Material Subsidiary shall not be required to maintain any such property if the
failure to maintain any such property is, in the judgment of the Borrower or
such Material Subsidiary, desirable in the conduct of the business of the
Borrower or such Material Subsidiary); and permit representatives of any Agent,
during normal business hours upon reasonable advance notice, to discuss its
business and affairs with its Financial Officers or their designees, all to the
extent reasonably requested by such Agent.
SECTION 5.04. INSURANCE. The Borrower will, and will cause each of its
Material Subsidiaries to, keep insured by financially sound and reputable
insurers all property of a character usually insured by corporations engaged
in the same or similar business and similarly situated against loss or damage
of the kinds and in the amounts customary for such corporations and carry
such other insurance as is usually carried by such corporations (it being
understood that insurance and self-insurance shall be permitted to the
extent consistent with prudent business practice and customary among such
corporations).
SECTION 5.05. PROHIBITION OF FUNDAMENTAL CHANGES. The Borrower will
not, nor will it permit any of its Material Subsidiaries to, (i) enter into any
transaction of merger or consolidation or (ii) convey, sell, lease, transfer or
otherwise dispose of, in one transaction or a series of related transactions,
all or a substantial part (determined by reference to the Borrower and its
Subsidiaries taken as a whole) of its business or property, whether now owned
or hereafter acquired (excluding (i) financings by way of sales of receivables
or inventory, (ii) inventory or other Property sold or disposed of in the
ordinary course of business and (iii) obsolete or worn-out property, tools or
equipment no longer used or useful in its business). Notwithstanding the
foregoing provisions of this Section 5.05:
(A) any Subsidiary of the Borrower may be merged or
consolidated with or into: (i) the Borrower if the Borrower shall be
the continuing or surviving corporation or (ii) any other such
<PAGE> 41
37
Subsidiary; provided that if any such transaction shall be between a
Subsidiary and a Wholly Owned Subsidiary, the Wholly Owned Subsidiary
shall be the continuing or surviving corporation;
(B) any Subsidiary of the Borrower may convey, sell, lease,
transfer or otherwise dispose of any of or all its property (upon
voluntary liquidation or otherwise) to the Borrower or a Wholly Owned
Subsidiary of the Borrower;
(C) the Borrower may merge or consolidate with or into any
other person if (i) either (x) the Borrower is the continuing or
surviving corporation or (y) the corporation formed by such
consolidation or into which the Borrower is merged shall be a
corporation organized under the laws of the United States of America,
any State thereof or the District of Columbia and shall expressly
assume the obligations of the Borrower hereunder pursuant to a written
agreement and shall have delivered to the Administrative Agent such
agreement and a certificate of a Responsible Officer and an opinion of
counsel to the effect that such merger or consolidation complies with
this Section 5.05(C), and (ii) after giving effect thereto and to any
repayment of Loans to be made upon the consummation thereof no Default
would exist;
(D) any Subsidiary of the Borrower may merge or consolidate
with or into any other person if, after giving effect thereto and to
any repayment of Loans to be made upon the consummation thereof, no
Default shall have occurred and be continuing; and
(E) the Borrower or any Subsidiary of the Borrower may convey,
sell, lease, transfer or otherwise dispose of its property if, after
giving effect thereto and to any repayment of Loans to be made upon
the consummation thereof (it being expressly understood that no
repayment of Loans is required solely by virtue thereof), no Default
shall have occurred and be continuing.
SECTION 5.06. LIMITATION ON LIENS. The Borrower will not, nor will it
permit any of its Material Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon any of its Property, whether now owned or hereafter
acquired, without causing such Lien to equally and ratably secure the
obligations of the Borrower hereunder and causing such Lien to include a Lien
on the proceeds of any secured assets which are sold; provided that the
foregoing restrictions shall not apply to:
(a) Liens imposed by any Governmental Authority for taxes,
assessments or charges not yet due and payable or which are being
contested in good faith and by appropriate proceedings if adequate
reserves with respect thereto are maintained;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, architects' or other like Liens arising in the ordinary
course of business which are not overdue for a period of more than 30
days or which are being contested in good faith and by appropriate
proceedings;
(c) Liens securing judgments or to perfect an appeal of any
order or decree but only to the extent, for an amount and for a period
not resulting in an Event of Default under paragraph (h) of Article
VI;
(d) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(e) pledges or deposits to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory
obligations to secure surety, appeal or performance bonds and
contractual and other obligations of a like nature incurred in the
ordinary course of business and not involving the borrowing of money;
<PAGE> 42
38
(f) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of property or minor imperfections in title
thereto and Liens under leases and subleases which, in the aggregate,
are not material in amount, and which do not interfere in any material
respects with the ordinary conduct of the business of the Borrower and
its Subsidiaries taken as a whole;
(g) Liens on property of any Subsidiary of the Borrower or of
any person which is or was merged with or into the Borrower or any
Subsidiary thereof, PROVIDED that such Liens are or were in existence
at the time such entity becomes or became a Subsidiary of the Borrower
and were not created in anticipation thereof other than to finance the
purchase thereof;
(h) Liens upon real and/or personal property acquired (by
purchase, construction, foreclosure, deed in lieu of foreclosure or
otherwise) by the Borrower or any of its Subsidiaries, each of which
Liens either (A) existed on such property before the time of its
acquisition and was not created in anticipation thereof or (B) was
created solely for the purpose of securing Indebtedness representing,
or incurred to finance, refinance or refund, all or a part of the cost
(including the cost of construction) of such property or improvements
thereon; PROVIDED that no such Lien shall extend to or cover any
property of the Borrower or such Subsidiary other than the respective
property so acquired and improvements thereon;
(i) mortgages on property securing indebtedness in favor of
the United States of America or any state thereof, or any department,
agency or instrumentality or political subdivision of the United
States of America or any state thereof, incurred for the purpose of
financing all or any part of the purchase price or the cost of
construction of the property subject to such mortgages (including
without limitation such debt secured by such mortgages in connection
with pollution control, industrial revenue or similar financings) or
incurred to secure progress, advance or other payments pursuant to any
contract or provision of any statute;
(j) Liens securing Indebtedness owed to the Borrower or to any
Wholly Owned Subsidiary of the Borrower;
(k) Liens (i) upon the receivables and inventory of the
Borrower or any of its Subsidiaries to secure Indebtedness resulting
from financings of such receivables and inventory in an aggregate
amount not greater than $800,000,000 less the aggregate amount of
Indebtedness that is secured pursuant to clause (ii) below, provided
that the terms of such Indebtedness do not provide for any recourse
to the Borrower or any Material Subsidiary (except to the extent of
breaches of representations and warranties of the Borrower or any of
its Subsidiaries in connection with such financings and other
recourse customary in connection with "OFF-BALANCE SHEET" financings)
and (ii) upon the property of the Borrower to secure Indebtedness of
the Borrower in an aggregate amount not greater than $250,000,000;
(l) additional Liens upon real and/or personal Property,
provided that the aggregate outstanding principal amount of the
Indebtedness (other than Indebtedness as defined in subsection (f) of
the definition thereof which has not been assumed by the Borrower or
any of its Subsidiaries and where the Lien relates to property
acquired by the Borrower or any of its Subsidiaries in satisfaction,
in whole or in part, of indebtedness to the Borrower or any of its
Subsidiaries, in the ordinary course of business) or liabilities
secured thereby shall not exceed $250,000,000 at any time;
(m) any extension, renewal or replacement of the foregoing;
provided, however, that, except to the extent otherwise permitted by
Section 5.06 (including Section 5.06(l)), the Liens
<PAGE> 43
39
permitted hereunder shall not be spread to cover any additional
Indebtedness or property (other than a substitution of like property
or improvements on such property or other property of equivalent
value); and
(n) Liens upon real and/or personal property owned at the date
hereof by WCI or LW Real Estate Investments, L.P.
SECTION 5.07. CONSOLIDATED LEVERAGE RATIO. The Borrower's Consolidated
Leverage Ratio will not at any time (a) during the period from the Closing Date
to and including June 30, 1995, exceed 4.0 to 1; (b) during the period from and
including July 1, 1995 to and including December 31, 1995, exceed 3.75 to 1;
(c) during the period from and including January 1, 1996 to and including
December 31, 1996, exceed 3.3 to 1; or (d) after December 31, 1996, exceed 3.0
to 1.
SECTION 5.08. CONSOLIDATED COVERAGE RATIO. The Borrower's Consolidated
Coverage Ratio for any period of four consecutive fiscal quarters, which period
ends on or after the date hereof, measured at the end of each fiscal quarter
shall not be less than the ratio set forth below opposite the period during
which such quarter ends:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
From the Closing Date to September 30, 1995 2.25 to 1
After September 30, 1995 2.50 to 1
</TABLE>
SECTION 5.09. MINIMUM CONSOLIDATED NET WORTH. (a) The Borrower will
not permit its Consolidated Net Worth at any date to be less than that set
forth below opposite the period during which such date occurs:
<TABLE>
<CAPTION>
Period Amount
------ ------
<S> <C>
Closing Date to and
including June 30, 1995 $750,000,000
July 1, 1995 to and
including September 30, 1995 $850,000,000
October 1, 1995 to and
including March 31, 1996 $1,000,000,000
</TABLE>
(b) The Borrower will not permit its Consolidated Net Worth at any
date after March 31, 1996 (each such date of determination pursuant to this
paragraph (b) being referred to herein as the "DETERMINATION DATE") to be less
than (i) $1,000,000,000 plus (ii) for each full fiscal quarter commencing after
December 31, 1995 and ending prior to the Determination Date, one half the
amount of the excess (if any) of (x) the amount of Consolidated Net Income (if
positive) for each such fiscal quarter over (y) the amount of all dividends
(other than dividends paid in common stock of the Borrower) paid by the
Borrower during each such fiscal quarter.
SECTION 5.10. TRANSACTIONS WITH AFFILIATES. The Borrower will not, nor
will it permit any of its Material Subsidiaries to, directly or indirectly
enter into any material transaction with any Affiliate of the
<PAGE> 44
40
Borrower except on terms at least as favorable to the Borrower or such
Subsidiary as it could obtain on an arm's-length basis.
SECTION 5.11. USE OF PROCEEDS. The Borrower will use the proceeds of
the Loans hereunder solely to replace the Existing Credit Agreement, to provide
working capital and for other general corporate purposes (in compliance with
all applicable legal and regulatory requirements, including, without
limitation, Regulations G and U and the Securities Act of 1933, as amended, and
the Securities Exchange Act of 1934, as amended, and the regulations
thereunder); PROVIDED that neither any of the Agents nor any Lender shall have
any responsibility as to the use of any of such proceeds.
SECTION 5.12. FISCAL YEAR. The Borrower shall not change its fiscal
year.
ARTICLE VI. EVENTS OF DEFAULT
In case of the happening of any of the following events ("EVENTS OF
DEFAULT"):
(a) the Borrower shall default in the payment when due of any
principal of any Loan; or the Borrower shall default in the payment
when due of any interest on any Loan, any Fee or any other amount
payable by it hereunder or under any other Loan Document and such
default shall continue unremedied for a period of five Business Days;
(b) any representation, warranty or certification made or
deemed made herein (or in any modification or supplement hereto) by
the Borrower, or any certificate furnished to any Lender or the
Administrative Agent pursuant to the provisions hereof (or thereof),
shall prove to have been false or misleading as of the time made,
deemed made or furnished in any material respect;
(c) the Borrower shall default in the performance of any of
its obligations under Section 5.01(f), Section 5.05 through 5.09
(inclusive) or Section 5.11; or the Borrower shall default in the
performance of any of its other obligations under this Agreement and
such default shall continue unremedied for a period of 15 days after
notice thereof to the Borrower by the Administrative Agent or any
Lender (through the Administrative Agent);
(d) the Borrower or any Subsidiary shall (i) fail to pay at
maturity any Indebtedness (other than Indebtedness as defined in
subsection (f) of the definition thereof which has not been assumed by
the Borrower or any of its Subsidiaries and where the Lien relates to
property acquired by the Borrower or any of its Subsidiaries in
satisfaction, in whole or in part, of indebtedness to the Borrower or
any of its Subsidiaries, in the ordinary course of business of WFSI,
any of its Subsidiaries, Financial Services or WCI) in an aggregate
amount in excess of $100,000,000, or (ii) fail to make any payment
(whether of principal, interest or otherwise), regardless of amount,
due in respect of, or fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or
instrument evidencing or governing, any such Indebtedness in excess of
$100,000,000 if the effect of any failure referred to in this clause
(ii) (x) is to cause, or to permit the holder or holders of such
Indebtedness or a trustee on its or their behalf to cause, such
Indebtedness to become due prior to its stated maturity or (y) has
caused such Indebtedness to become due prior to its stated maturity
(it being agreed that for purposes of this paragraph (d) only (other
than subclause(ii)(x) of this paragraph (d)), the term "INDEBTEDNESS"
shall include obligations under any interest rate protection
agreement, foreign currency exchange agreement or other interest or
exchange rate hedging agreement and that the amount of any person's
obligations under any such agreement shall be the net amount that such
person could be required to pay as a result of a termination thereof
by reason of a default thereunder);
<PAGE> 45
41
(e) the Borrower or any of its Material Subsidiaries shall
admit in writing its inability, or be generally unable, to pay its
debts as such debts become due;
(f) the Borrower or any of its Material Subsidiaries shall (i)
apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself
or of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a
voluntary case under the Bankruptcy Code (as now or hereafter in
effect), (iv) file a petition seeking to take advantage of any other
law relating to bankruptcy, insolvency, reorganization, winding- up,
or composition or readjustment of debts, (v) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the Bankruptcy
Code, or (vi) take any corporate action for the purpose of effecting
any of the foregoing;
(g) a proceeding or case shall be commenced, without the
application or consent of the Borrower or any of its Material
Subsidiaries, in any court of competent jurisdiction, seeking (i) its
liquidation, reorganization, dissolution or winding-up, or the
composition or readjustment of its debts, (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like of the Borrower
or such Material Subsidiary or of all or any substantial part of its
assets, or (iii) similar relief in respect of the Borrower or such
Material Subsidiary under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and
such proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of 60 or
more days; or an order for relief against the Borrower or such
Material Subsidiary shall be entered in an involuntary case under the
Bankruptcy Code;
(h) a final judgment or judgments for the payment of money in
excess of $100,000,000 in the aggregate shall be rendered by one or
more courts, administrative tribunals or other bodies having
jurisdiction against the Borrower and/or any of its Material
Subsidiaries and the same shall not be paid or discharged (or
provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 60 days from the date
of entry thereof and the Borrower or the relevant Material Subsidiary
shall not, within said period of 60 days, or such longer period during
which execution of the same shall have been stayed, appeal therefrom
and cause the execution thereof to be stayed during such appeal;
(i) an event or condition specified in Section 5.01(e) shall
occur or exist with respect to any Plan or Multiemployer Plan and, as
a result of such event or condition, together with all other such
events or conditions, the Borrower or any ERISA Affiliate shall incur
or in the good faith opinion of the Required Lenders shall be
reasonably likely to incur a liability to a Plan, a Multiemployer
Plan or PBGC (or any combination of the foregoing) which would
constitute, in the good faith determination of the Required Lenders,
a Material Adverse Effect; or
(j) a Change of Control shall have occurred or, with respect
to any period of 25 consecutive calendar months (whether commencing
before or after the date of this Agreement), individuals who were
directors of the Borrower on the first day of such period or who were
nominated by such directors shall no longer occupy a majority of the
seats (other than vacant seats) on the board of directors of the
Borrower (excluding by reason of the death or retirement of any
director);
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (f) or (g) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take any of or all the
following actions, at the same or different times: (i) terminate forthwith the
Commitments, and (ii) declare
<PAGE> 46
42
the Loans then outstanding to be forthwith due and payable in whole or in
part, whereupon the principal of the Loans so declared to be due and payable,
together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall become forthwith due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other
Loan Document to the contrary notwithstanding; and in any event with respect
to the Borrower described in paragraph (f) or (g) above, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other
Loan Document to the contrary notwithstanding.
ARTICLE VII. THE AGENTS
In order to expedite the transactions contemplated by this Agreement,
the Agents are hereby appointed to act as Agents and Chemical Bank is hereby
appointed to act as Administrative Agent on behalf of the Lenders. Each of the
Lenders hereby irrevocably authorizes the Administrative Agent to take such
actions on its behalf and to exercise such powers as are specifically delegated
to the Administrative Agent by the terms and provisions hereof and of the other
Loan Documents, together with such actions and powers as are reasonably
incidental thereto. The Administrative Agent is hereby expressly authorized by
the Lenders, without hereby limiting any implied authority, (a) to receive on
behalf of the Lenders all payments of principal of and interest on the Loans
and all other amounts due to the Lenders hereunder, and promptly to distribute
to each Lender its proper share of each payment so received; (b) to give notice
on behalf of each of the Lenders to the Borrower of any Event of Default
specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and other
materials delivered by the Borrower pursuant to this Agreement as received by
the Administrative Agent.
Neither any Agent nor any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted by any of them
except for its or his own gross negligence or wilful misconduct, or be
responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by
the Borrower of any of the terms, conditions, covenants or agreements contained
in any Loan Document. The Agents shall not be responsible to the Lenders for
the due execution, genuineness, validity, enforceability or effectiveness of
this Agreement or any other Loan Documents or other instruments or agreements.
The Administrative Agent shall in all cases be fully protected in acting,
or refraining from acting, in accordance with written instructions signed by
the Required Lenders and, except as otherwise specifically provided herein,
such instructions and any action or inaction pursuant thereto shall be binding
on all the Lenders and the Issuing Banks. The Administrative Agent shall, in
the absence of knowledge to the contrary, be entitled to rely on any instrument
or document believed by it in good faith to be genuine and correct and to have
been signed or sent by the proper person or persons. Neither the Agents nor any
of their directors, officers, employees or agents shall have any responsibility
to the Borrower on account of the failure of or delay in performance or breach
by any Lender of any of its obligations hereunder or to any Lender on account
of the failure of or delay in performance or breach by any other Agent, any
other Lender or the Borrower of any of their respective obligations hereunder
or under any other Loan Document or in connection herewith or therewith. The
Administrative Agent may execute any and all duties hereunder by or through
agents or employees and shall be entitled to rely upon the advice of legal
counsel selected by it with respect to all matters arising hereunder and shall
not be liable for any action taken or suffered in good faith by it in
accordance with the advice of such counsel.
<PAGE> 47
43
The Lenders hereby acknowledge that the Administrative Agent shall be
under no duty to take any discretionary action permitted to be taken by it
pursuant to the provisions of this Agreement unless it shall be requested in
writing to do so by the Required Lenders.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, the Administrative Agent may resign at
any time by notifying the Lenders and the Borrower. Upon any such resignation,
the Required Lenders shall have the right to appoint from the Lenders a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint from the Lenders a
successor Administrative Agent which shall be a bank with an office in New
York, New York, having a combined capital and surplus of at least $500,000,000
or an Affiliate of any such bank, which successor shall be acceptable to the
Borrower (such acceptance not to be unreasonably withheld). Upon the acceptance
of any appointment as Administrative Agent hereunder by a successor bank, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 8.05 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Administrative Agent.
With respect to the Loans made by them hereunder, the Agents in their
individual capacity and not as Agents shall have the same rights and powers as
any other Lender and may exercise the same as though they were not Agents, and
the Agents and their Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any of its
Subsidiaries or other Affiliate thereof as if they were not Agents.
Each Lender agrees (i) to reimburse the Administrative Agent in the
amount of its pro rata share (based on its Standby Commitment hereunder or, if
the Standby Commitments hereunder have been terminated, based on its
outstanding Loans (and participations therein) hereunder) of any reasonable,
out-of-pocket expenses incurred for the benefit of the Lenders by the
Administrative Agent, including reasonable counsel fees and compensation of
agents and employees paid for services rendered on behalf of the Lenders, which
shall not have been reimbursed by the Borrower and (ii) to indemnify and hold
harmless the Administrative Agent and any of its directors, officers, employees
or agents in the amount of such pro rata share, from and against any and all
liabilities, taxes, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against it in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or any other Loan Document or any action taken or omitted by it under
this Agreement or any other Loan Document, to the extent the same shall not
have been reimbursed by the Borrower; PROVIDED that no Lender shall be liable
to the Administrative Agent for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the gross negligence or wilful misconduct of the
Administrative Agent or any of its directors, officers, employees or agents.
Each Lender acknowledges that it has, independently and without
reliance upon the Agents or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon any Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement or any other Loan Document, any related
agreement or any document furnished hereunder or thereunder.
<PAGE> 48
44
None of the Co-Agents shall have any duties or responsibilities
hereunder in its capacity as a Co-Agent.
ARTICLE VIII. MISCELLANEOUS
SECTION 8.01. NOTICES. Notices and other communications provided for
herein shall be in writing (or, where permitted to be made by telephone, shall
be confirmed promptly in writing) and shall be delivered by hand or overnight
courier service, mailed or sent by telecopier as follows:
(a) if to the Borrower, to it at Westinghouse Building, 11
Stanwix Street, Pittsburgh, Pennsylvania 15222, Attention of Executive
Vice President, Finance and Chief Financial Officer (Telecopy No.
(412) 642-5641);
(b) if to the Administrative Agent, to it at 270 Park Avenue,
New York, New York 10017, Attention of James Treger (Telecopy No.
(212) 270-7138), and with a copy to Chemical Bank Agency Services
Corporation, Grand Central Tower, 140 East 45th Street, New York, New
York 10017, Attention of Barbara Clemens (Telecopy No. (212)
622-0002);
(c) if to a Lender or Co-Agent, to it at its address (or
telecopy number) set forth in Schedule 2.01 or in the Assignment and
Acceptance pursuant to which such Lender shall have become a party
hereto; and
(d) if to a Designated Bidder, to it at its address (or
telecopy number) set forth in the Administrative Questionnaire
delivered by such Designated Bidder.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service, sent by
telecopy or, if permitted by the terms hereof and if promptly confirmed in
writing, by telephone, or on the date five Business Days after dispatch by
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 8.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 8.01.
SECTION 8.02. SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the making by the
Lenders of the Loans, regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any Fee or any other amount
payable under this Agreement or any other Loan Document is outstanding and
unpaid and so long as the Commitments have not been terminated.
SECTION 8.03. BINDING EFFECT. This Agreement shall become effective
when it shall have been executed by the Borrower and the Administrative Agent
and when the Administrative Agent shall have received copies hereof which, when
taken together, bear the signatures of each Lender and thereafter shall be
binding upon and inure to the benefit of the Borrower, the Administrative Agent
and each Lender and their respective successors and assigns, except that the
Borrower shall not have the right (other than through transactions referred to
in and permitted by Section 5.05(C)) to assign its rights or obligations
hereunder or any interest herein without the prior consent of all the Lenders.
<PAGE> 49
45
SECTION 8.04. SUCCESSORS AND ASSIGNS. (a) Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the Borrower, the Administrative Agent, the
Co-Agents or the Lenders that are contained in this Agreement shall bind and
inure to the benefit of their respective successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion
of its interests, rights and obligations under this Agreement (including all or
a portion of its Standby Commitment, Swingline Commitment and the Loans at the
time owing to it); PROVIDED, HOWEVER, that (i) except in the case of an
assignment to a Lender or an affiliate of such Lender (other than if at the
time of such assignment, such Lender or affiliate would be entitled to require
the Borrower to pay greater amounts under Section 2.20(a) than if no such
assignment had occurred, in which case such assignment shall be subject to the
consent requirement of this clause (i)), the Borrower, the Administrative Agent
and each Swingline Lender must give their prior written consent to such
assignment (which consent shall not be unreasonably withheld), (ii) after
giving effect to any such assignment and to all assignments under the Facility
B Credit Agreement to be made on such date, the Applicable Percentage of each
assigning Lender and assignee Lender shall be equal to the Applicable
Percentage (as defined in the Facility B Credit Agreement) of such assigning
Lender and assignee Lender, respectively, (iii) other than in the case of an
assignment to a Lender or an affiliate of such Lender, the amount of the
Commitments of the assigning Lender subject to each such assignment, when added
to the amount of the Commitments (as defined in the Facility B Credit
Agreement) assigned on such date by such assigning Lender pursuant to the
Facility B Credit Agreement, (determined in each case as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $25,000,000, (iv) the assignor and
assignee shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $3,500 and
(v) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon acceptance and
recording pursuant to paragraph (e) of this Section 8.04, from and after the
effective date specified in each Assignment and Acceptance, which effective
date shall be at least five Business Days after the execution thereof (or any
lesser period to which the Administrative Agent and the Borrower may agree),
(A) the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and (B) the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of
an assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto (but shall continue to be entitled to the
benefits of Sections 2.13, 2.15, 2.20 and 8.05, as well as to any Fees accrued
for its account hereunder and not yet paid)). Notwithstanding the foregoing,
any Lender assigning its rights and obligations under this Agreement may retain
any Competitive Loans made by it outstanding at such time, and in such case
shall retain its rights hereunder in respect of any Loans so retained until
such Loans have been repaid in full in accordance with this Agreement.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim and
that its Commitment, and the outstanding balances of its Standby Loans,
Competitive Loans and Swingline Loans, if any, in each case without giving
effect to assignments thereof which have not become effective, are as set forth
in such Assignment and Acceptance, (ii) except as set forth in (i) above, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or any of its Subsidiaries or
the performance or observance by the Borrower or any of its Subsidiaries of any
of its obligations under this Agreement,
<PAGE> 50
46
any other Loan Document or any other instrument or document furnished
pursuant hereto; (iii) such assignee represents and warrants that it is
legally authorized to enter into such Assignment and Acceptance; (iv) such
assignee confirms that it has received a copy of this Agreement, together
with copies of the most recent financial statements delivered pursuant to
Sections 3.02 and 5.01 and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (v) such assignee will independently and
without reliance upon the Administrative Agent, the Co-Agents, such assigning
Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement; (vi) such assignee
appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the
obligations which by the terms of this Agreement are required to be performed
by it as a Lender.
(d) The Administrative Agent, acting for this purpose as agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy
of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "REGISTER"). The entries in the Register shall be
conclusive in the absence of manifest error and the Borrower, the
Administrative Agent and the Lenders may treat each person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement. The Register shall be available for inspection
by the Borrower and any Lender, at any reasonable time and from time to time
upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, an Administrative
Questionnaire completed in respect of the assignee (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) above and, if required, the written consent of the Borrower,
the Administrative Agent and each Swingline Lender to such assignment, the
Administrative Agent shall (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and (iii) give prompt
notice thereof to the Borrower.
(f) Each Lender may without the consent of the Borrower or the Agents
sell participations to one or more banks or other financial institutions in all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitments and the Loans owing to it); PROVIDED, HOWEVER,
that (i) such Lender's obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto
for the performance of such obligations, (iii) the participating banks or other
entities shall be entitled to the benefit of the cost protection provisions
contained in Sections 2.13, 2.15 and 2.20 to the same extent as if they were
Lenders (provided that additional amounts payable to any Lender pursuant to
Section 2.20 shall be determined as if such Lender had not sold any such
participations) and (iv) the Borrower, the Agents and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrower relating to
the Loans and to approve any amendment, modification or waiver of any provision
of this Agreement (other than amendments, modifications or waivers decreasing
any fees payable hereunder or the amount of principal of or the rate at which
interest is payable on the Loans, extending any scheduled principal payment
date or date fixed for the payment of interest on the Loans or changing or
extending the Commitments).
(g) Any Lender or participant may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section 8.04, disclose to the assignee or participant or proposed
<PAGE> 51
47
assignee or participant any information relating to the Borrower furnished to
such Lender by or on behalf of the Borrower; PROVIDED that, prior to any such
disclosure of information designated by the Borrower as confidential, each
such assignee or participant or proposed assignee or participant shall
execute a Confidentiality Agreement whereby such assignee or participant
shall agree (subject to the exceptions set forth therein) to preserve the
confidentiality of such confidential information. It is understood that
confidential information relating to the Borrower would not ordinarily be
provided in connection with assignments or participations of Competitive Loans.
(h) Notwithstanding the limitations set forth in paragraph (b) above,
any Lender may at any time assign or pledge all or any portion of its rights
under this Agreement to a Federal Reserve Bank without the prior written
consent of the Borrower, the Administrative Agent or any Swingline Lender;
PROVIDED that no such assignment shall release a Lender from any of its
obligations hereunder. In order to facilitate such an assignment to a Federal
Reserve Bank, the Borrower shall, at the request of the assigning Lender, duly
execute and deliver to the assigning Lender a registered promissory note or
notes evidencing the Loans made to the Borrower by the assigning Lender
hereunder.
(i) The Borrower shall not assign or delegate any of its rights or
duties hereunder (other than through transactions referred to in and permitted
by Section 5.05(C)) without the prior consent of all the Lenders.
SECTION 8.05. EXPENSES; INDEMNITY. (a) The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Administrative Agent in
connection with the preparation and negotiation of this Agreement and the other
Loan Documents or in connection with any amendments, modifications or waivers
of the provisions hereof or thereof (whether or not the transactions hereby
contemplated shall be consummated) or incurred by any Administrative Agent or
any Lender in connection with the enforcement or protection of the rights of
the Agents or the Lenders under this Agreement and the other Loan Documents or
in connection with the Loans made hereunder, including the reasonable fees,
charges and disbursements of Cravath, Swaine & Moore, counsel for the Agents,
and, in connection with any such enforcement or protection, the reasonable
fees, charges and disbursements of any other counsel for any Agent or Lender.
(b) The Borrower agrees to indemnify each Agent, each Lender and each
of their respective directors, officers, employees, agents and controlling
persons (each such person being called an "INDEMNITEE") against, and to hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities
and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of,
in any way connected with, or as a result of (i) the execution or delivery of
this Agreement and any amendments thereto or any other Loan Document or any
agreement or instrument contemplated thereby, the performance by the parties
thereto of their respective obligations thereunder or the consummation of the
transactions contemplated thereby, (ii) the use of the proceeds of the Loans or
(iii) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto; PROVIDED that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined by
a court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or wilful misconduct of such Indemnitee, (y)
result from any unexcused breach by such Indemnitee of its obligations
hereunder or (z) result from disputes among the Indemnitees not involving the
Borrower.
(c) The provisions of this Section 8.05 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term
or provision of this Agreement or any other Loan Document or any investigation
made by or on behalf of any
<PAGE> 52
48
Administrative Agent or Lender. All amounts due under this Section 8.05 shall
be payable on written demand therefor.
SECTION 8.06. RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
other Loan Documents held by such Lender which shall be due and payable. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 8.07. APPLICABLE LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE WITHIN SUCH STATE, WITHOUT
REGARD TO CONFLICTS OF LAW PROVISIONS AND PRINCIPLES OF SUCH STATE.
SECTION 8.08. WAIVERS; AMENDMENT. (a) No failure or delay of any Agent
or any Lender in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Agents and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies which they would otherwise have. No waiver
of any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on the Borrower in any case shall entitle the
Borrower to any other or further notice or demand in similar or other
circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; PROVIDED, HOWEVER, that
no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or date for the payment of any interest on any Loan, or waive or
excuse any such payment or any part thereof, or decrease the rate of interest
on any Loan or the Facility Fee, without the prior written consent of each
Lender affected thereby, (ii) change or extend the Commitment of any Lender or
decrease the Fees of any Lender without the prior written consent of such
Lender, or (iii) amend or modify the provisions of Section 2.16, the provisions
of this Section, the definition of "Required Lenders" or any provision hereof
that requires the consent of each Lender, without the prior written consent of
each Lender; PROVIDED FURTHER that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent or the
Swingline Lenders hereunder in such capacity without the prior written consent
of the Administrative Agent or the Swingline Lenders, as the case may be.
SECTION 8.09. INTEREST RATE LIMITATION. Notwithstanding anything
herein to the contrary, if at any time the applicable interest rate, together
with all fees and charges which are treated as interest under applicable law
(collectively the "CHARGES"), as provided for herein or in any other document
executed in connection herewith, or otherwise contracted for, charged,
received, taken or reserved by any Lender, shall exceed the maximum lawful rate
(the "MAXIMUM RATE") which may be contracted for, charged, taken, received or
reserved by such Lender in accordance with applicable law, the rate of interest
payable to such Lender hereunder, together with all Charges payable to such
Lender, shall be limited to the Maximum Rate.
<PAGE> 53
49
SECTION 8.10. ENTIRE AGREEMENT. This Agreement and the other Loan
Documents constitute the entire contract between the parties relative to the
subject matter hereof. Any previous agreement among the parties with respect to
the subject matter hereof is superseded by this Agreement and the other Loan
Documents. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.
SECTION 8.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 8.11.
SECTION 8.12. SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby. The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 8.13. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which constitute an original but all of which when
taken together shall constitute but one contract, and shall become effective as
provided in Section 8.03.
SECTION 8.14. HEADINGS. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 8.15. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a) The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
any Lender may otherwise have to bring any action or proceeding relating to
this Agreement or the other Loan Documents against the Borrower or its
properties in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in
any New York State or Federal court. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in
any such court.
<PAGE> 54
50
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 8.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 8.16. [Intentionally Omitted]
SECTION 8.17. DESIGNATED BIDDERS. Each Lender shall have the right
from time to time, with the consent of the Borrower and the Administrative
Agent (which consent shall not be unreasonably withheld) to designate one or
more Eligible Designees to submit Competitive Bids (in addition to any
Competitive Bids submitted by such Lender) pursuant to Competitive Bid Requests
made under Section 2.03. Upon (i) the execution by any such Eligible Designee
of a Designation Agreement and the acceptance thereof by the Borrower and the
Administrative Agent, (ii) the execution and delivery by such Eligible Designee
to the Borrower of a Confidentiality Agreement, and (iii) the delivery by such
Eligible Designee to the Administrative Agent of an Administrative
Questionnaire, such Eligible Designee shall become a Designated Bidder for
purposes of this Agreement and shall have the right to submit Competitive Bids
and, in the event such Competitive Bids are accepted, to make Competitive
Loans. As to any Competitive Loan made by it, each Designated Bidder shall have
all the rights and be subject to all obligations a Lender making such Loan
would have had under this Agreement and otherwise (including all rights to
receive information required to be provided by the Borrower hereunder);
PROVIDED that (i) all voting and consensual rights under this Agreement in
respect of such Competitive Loan shall be exercised solely by the Designating
Lender, and (ii) no Designated Bidder shall be entitled to recover a greater
amount under Section 2.13 or 2.20 than the Designating Lender would have been
entitled to recover had such Loan been made by it. In the event the Commitment
of any Designating Lender shall be terminated and its outstanding Loans
assigned or prepaid pursuant to Section 2.21 or otherwise, all Designated
Bidders designated by such Designating Lender shall cease to be Designated
Bidders (but shall retain their rights hereunder with respect to Competitive
Loans at the time outstanding).
SECTION 8.18. CONFIDENTIALITY. (a) Each Lender agrees to keep
confidential and not to disclose (and to cause its officers, directors,
employees, agents and representatives to keep confidential and not to disclose)
and, at the request of the Borrower (except as provided below or if such Lender
is required to retain any Information (as defined below) pursuant to customary
internal or banking practices, bank regulations or applicable law), promptly to
return to the Borrower or destroy the Information and all copies thereof,
extracts therefrom and analyses or other materials based thereon, except that
such Lender shall be permitted to disclose Information (i) to such of its
officers, directors, employees, agents, affiliates and representatives as need
to know such Information in connection with such Lender's participation in this
Agreement, each of whom shall be informed by such Lender of the confidential
nature of the Information and shall agree to be bound by the terms of this
Section 8.18; (ii) to the extent required by applicable laws and regulations or
by any subpoena or similar legal process or requested by any governmental
authority or agency having jurisdiction over such Lender; provided, however,
that prior to such disclosure a written opinion of counsel to such Lender shall
be provided to the Borrower to such effect (except that no opinion will be
required for disclosure to bank regulators or examiners in accordance with
customary banking practices or if the provision of such opinion would violate
applicable law); (iii) to the extent such Information (A) becomes publicly
available other that as a result of a breach of this Agreement, (B) becomes
available to such Lender on a non-confidential basis from a source other than a
party to this Agreement or any other party known to such Lender to be bound by
an agreement containing a provision similar to this Section 8.18 or (C) was
available to such Lender on a non- confidential basis prior to its disclosure
to such Lender by a party to this Agreement or any other party known to such
Lender to be bound by an agreement containing a provision similar to this
Section 8.18; (iv) as permitted by Section 8.04(g); or (v) to the extent the
Borrower shall have consented to such disclosure in writing. As used in this
Section 8.18, "INFORMATION" shall mean any materials, documents or information
furnished by or on
<PAGE> 55
51
behalf of the Borrower in connection with this Agreement designated by or
on behalf of the Borrower as confidential.
(b) Each Lender (i) agrees that, except to the extent the conditions
referred to in subclauses (A), (B) or (C) of clause (iii) of paragraph (a)
above have been met and as provided in paragraph (c) below, (a) it will use the
Information only in connection with its participation in this Agreement and (B)
it will not use the Information in connection with any other matter or in a
manner prohibited by any law, including, without limitation, the securities
laws of the United States and (ii) understands that breach of this Section 8.18
might seriously prejudice the interest of the Borrower and that the Borrower is
entitled to equitable relief, including an injunction, in the event of such
breach.
(c) Notwithstanding anything to the contrary contained in this Section
8.18, each Lender shall be entitled to retain all Information for so long as it
remains a Lender to use solely for the purposes of servicing the credit and
protecting its rights with respect hereto.
SECTION 8.19. TERMINATION OF EXISTING CREDIT AGREEMENT. Each Lender
that is a party to the Existing Credit Agreement hereby waives the three-day
notice requirement to terminate the commitments under the Existing Credit
Agreement and consents to the delivery of such notice at the closing of this
Agreement.
IN WITNESS WHEREOF, the Borrower, the Agents and the Lenders have
caused this Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.
WESTINGHOUSE ELECTRIC CORPORATION,
by ___________________________________
Name:
Title:
CHEMICAL BANK, individually and as
Administrative Agent,
by ___________________________________
Name:
Title:
<PAGE> 56
ABN AMRO BANK N.V., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 57
BANK OF MONTREAL, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 58
THE BANK OF NEW YORK, individually and
as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 59
THE BANK OF NOVA SCOTIA, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 60
BARCLAYS BANK PLC, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 61
CITIBANK, N.A., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 62
CONTINENTAL BANK, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 63
CREDIT LYONNAIS NEW YORK BRANCH,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 64
CREDIT SUISSE, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 65
THE DAI-ICHI KANGYO BANK, LTD.,
individually and as Co-Agent,
by __________________________________
Name:
Title:
<PAGE> 66
DEUTSCHE BANK AG NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
by ___________________________________
Name:
Title:
<PAGE> 67
THE FIRST NATIONAL BANK OF CHICAGO,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 68
THE FUJI BANK, LIMITED, NEW YORK
BRANCH, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 69
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
NEW YORK BRANCH,
individually and Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 70
LTCB TRUST COMPANY, individually and as
Co-Agent
by ___________________________________
Name:
Title:
<PAGE> 71
MELLON, BANK, N.A., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 72
THE MITSUBISHI BANK, LIMITED--NEW YORK
BRANCH, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 73
THE MITSUBISHI TRUST AND BANKING
CORPORATION, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 74
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 75
NATIONSBANK N.C., N.A., individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 76
PNC BANK, NATIONAL ASSOCIATION,
individually and as Co-Agent,
by ________________________________
Name:
Title:
<PAGE> 77
SANWA BANK LIMITED, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 78
SOCIETE GENERALE, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 79
THE SUMITOMO BANK, LIMITED,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 80
THE TORONTO-DOMINION BANK, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 81
UNION BANK OF SWITZERLAND, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 82
BANKERS TRUST COMPANY,
by ___________________________________
Name:
Title:
<PAGE> 83
ROYAL BANK OF CANADA,
by ___________________________________
Name:
Title:
<PAGE> 84
SHAWMUT BANK CONNECTICUT, N.A.,
by ___________________________________
Name:
Title:
<PAGE> 85
BANQUE PARIBAS,
by ___________________________________
Name:
Title:
<PAGE> 86
THE TOKAI BANK, LIMITED--NEW YORK
BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 87
ARAB BANKING CORPORATION,
by ___________________________________
Name:
Title:
<PAGE> 88
BANK BRUSSELS LAMBERT NEW YORK BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 89
BANK OF HAWAII,
by ___________________________________
Name:
Title:
<PAGE> 90
THE BANK OF TOKYO TRUST COMPANY,
by ___________________________________
Name:
Title:
<PAGE> 91
FIRST INTERSTATE BANK OF CALIFORNIA,
by ___________________________________
Name:
Title:
<PAGE> 92
THE FIRST NATIONAL BANK OF MARYLAND,
by ___________________________________
Name:
Title:
<PAGE> 93
ISTITUTO BANCARIO SAN PAOLO DI
TORINO SPA,
by ___________________________________
Name:
Title:
<PAGE> 94
MITSUI TRUST BANK (U.S.A.),
by ___________________________________
Name:
Title:
<PAGE> 95
THE SUMITOMO TRUST & BANKING CO. LTD.,
NEW YORK BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 96
THE YASUDA TRUST AND BANKING
COMPANY LIMITED--NEW YORK BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 97
EXHIBIT A-1
FORM OF COMPETITIVE BID REQUEST
Chemical Bank, as Administrative Agent for
the Lenders referred to below,
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the "Borrower"), refers
to the 364-day Competitive Advance and Revolving Credit Facility Agreement
dated as of August 5, 1994 (as it may hereafter be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. The Borrower hereby gives you notice pursuant to Section
2.03(a) of the Credit Agreement that it requests a Competitive Borrowing under
the Credit Agreement, and in that connection sets forth below the terms on
which such Competitive Borrowing is requested to be made:
(A) Date of Competitive Borrowing
(which is a Business Day)
(B) Principal Amount of
Competitive Borrowing 1/
-
(C) Interest rate basis 2/
-
(D) Interest Period and the last
__________________
1/ Not less than $25,000,000 (and in integral multiples of $1,000,000)
-
or greater than the Total Commitment then available.
2/ Eurodollar Loan or Fixed Rate Loan.
-
<PAGE> 98
2
day thereof 3/
-
Upon acceptance of any or all of the Loans offered by the Lenders in
response to this request, the Borrower shall be deemed to have represented and
warranted that the conditions to lending specified in Section 4.02(b) and (c)
of the Credit Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by______________________
Title: [Responsible
Officer]
__________________
3/ Which shall be subject to the definition of "Interest Period" and
-
end not later than the Maturity Date.
<PAGE> 99
EXHIBIT A-2
FORM OF NOTICE OF COMPETITIVE BID REQUEST
[Name of Lender]
[Address]
New York, New York
Attention:
[Date]
Dear Sirs:
Reference is made to the 364-day Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as it may hereafter be amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among Westinghouse Electric Corporation (the "Borrower"), the
Lenders party thereto, the Co-Agents named therein and Chemical Bank, as
Administrative Agent. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Credit Agreement.
The Borrower made a Competitive Bid Request on , 19 , pursuant to
Section 2.03(a) of the Credit Agreement, and in that connection you are invited
to submit a Competitive Bid by [Date]/[Time]. 1/ Your Competitive Bid must
comply with Section 2.03(b) of the Credit Agreement and the terms set forth
below on which the Competitive Bid Request was made:
(A) Date of Competitive Borrowing
(B) Principal amount of
Competitive Borrowing
(C) Interest rate basis
__________________
1/ The Competitive Bid must be received by the Agent (i) in the case of
Eurodollar Loans, not later than 9:30 a.m., New York City time, three Business
Days before a proposed Competitive Borrowing, and (ii) in the case of Fixed
Rate Loans, not later than 9:30 a.m., New York City time, on the day of a
proposed Competitive Borrowing.
<PAGE> 100
2
(D) Interest Period and the last
day thereof
Very truly yours,
CHEMICAL BANK, as
Administrative Agent,
By_____________________
Title:
<PAGE> 101
EXHIBIT A-3
FORM OF COMPETITIVE BID
Chemical Bank, as Administrative Agent for
the Lenders referred to below,
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, (Name of Lender), refers to the 364-day Competitive
Advance and Revolving Credit Facility Agreement dated as of August 5, 1994
(as it may hereafter be amended, restated, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among Westinghouse Electric
Corporation (the "Borrower"), the Lenders party thereto, the Co-Agents
named therein and Chemical Bank, as Administrative Agent. Capitalized terms
used herein and not otherwise defined herein shall have the meanings assigned
to such terms in the Credit Agreement. The undersigned hereby makes a
competitive Bid pursuant to Section 2.03 (b) of the Credit Agreement,
in response to the Competitive Bid Request made by the Borrower on ,
19 , and in that connection sets forth below the terms on which such
Competitive Bid is made:
(A) Principal Amount 1/
-
(B) Competitive Bid Rate 2/
-
(C) Interest Period and last
day thereof
____________________________
1/ Not less than $5,000,000 or greater than the requested Competitive
Borrowing and in integral multiples of $1,000,000. Multiple bids will be
accepted by the Agent.
2/ i.e., LIBO Rate + or - %, in the case of Eurodollar Loans or
%, in the case of Fixed Rate Loans.
<PAGE> 102
The Undersigned hereby confirms that it is prepared, subject to the
conditions set forth in the Credit Agreement, to extend credit to the Borrower
on the requested date of the Competitive Bid Borrowing upon acceptance by the
Borrower of this bid in accordance with Section 2.03 (d) of the Credit
Agreement.
Very truly yours,
(NAME OF LENDER),
by_______________________
Title:
<PAGE> 103
EXHIBIT A-4
FORM OF COMPETITIVE BID ACCEPT/REJECT LETTER
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention: [ ]
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the "Borrower"), refers
to the 364-day Competitive Advance and Revolving Credit Facility dated as of
August 5, 1994 (as it may hereafter be amended, restated, supplemented or
otherwise modified from time to time, the "Credit Agreement"), among the
Borrower, the Lenders party thereto, the Co-Agents named therein and Chemical
Bank, as Administrative Agent for the Lenders.
In accordance with Section 2.03(c) of the Credit Agreement, we have received
a summary of bids in connection with our Competitive Bid Request dated
______________ and in accordance with Section 2.03(d) of the Credit Agreement,
we hereby accept the following bids for maturity on [date]:
<TABLE>
<CAPTION>
Principal Amount Fixed Rate/Margin Lender
---------------- ----------------- ------
<S> <C> <C> <C>
$ [%] [+/-. %]
$
</TABLE>
We hereby reject the following bids:
<TABLE>
<CAPTION>
Principal Amount Fixed Rate/Margin Lender
---------------- ----------------- ------
<S> <C> <C> <C>
$ [%] [+/-. %]
$
</TABLE>
<PAGE> 104
2
The $ should be deposited in Chemical Bank account number [ ] on
[date].
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by
____________________________
Name:
Title:
<PAGE> 105
EXHIBIT A-5
FORM OF STANDBY BORROWING REQUEST
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the "Borrower"), refers
to the 364-day Competitive Advance and Revolving Credit Facility Agreement
dated as of August 5, 1994 (as it may hereafter be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. The Borrower hereby gives you notice pursuant to Section
2.04 of the Credit Agreement that it requests a Standby Borrowing under the
Credit Agreement, and in that connection sets forth below the terms on which
such Standby Borrowing is requested to be made:
(A) Date of Standby Borrowing
(which is a Business Day)
(B) Principal Amount of
Standby Borrowing 1/
(C) Interest rate basis 2/
__________________
1/ Not less than $50,000,000 in the case of Eurodollar Loans or CD
Loans and $25,000,000 in the case of ABR Loans (and in integral multiples of
$5,000,000) or greater than the Total Commitment then available.
2/ Eurodollar Loan, CD Loan or ABR Loan.
<PAGE> 106
2
(D) Interest Period and the last
day thereof 3/
Upon acceptance of any or all of the Loans made by the Lenders in response
to this request, the Borrower shall be deemed to have represented and warranted
that the conditions to lending specified in Section 4.02(b) and (c) of the
Credit Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by
_____________________________________
Title:
__________________
3/ Which shall be subject to the definition of "Interest Period" and
end not later than the Maturity Date.
<PAGE> 107
Exhibit B
[LOGO]
Chemical Bank
140 East 46th Street
New York, NY 10017-3762
212-622-0001
Fax 212/622-0002
Telex 353006 ABSC NYK
WESTINGHOUSE ELECTRIC CORPORATION
ADMINISTRATIVE QUESTIONNAIRE
Please accurately complete the following information and return via FAX to the
attention of Barbara Clemens at Chemical Bank as soon as possible.
FAX Number: 212-622-0854
LEGAL NAME TO APPEAR IN DOCUMENTATION:
- --------------------------------------
- ------------------------------------------------------------------------------
GENERAL INFORMATION - DOMESTIC LENDING OFFICE:
- ----------------------------------------------
Institution Name:
-----------------------------------------------------------
Street Address:
-----------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
GENERAL INFORMATION - EURODOLLAR LENDING OFFICE:
- ------------------------------------------------
Institution Name:
-----------------------------------------------------------
Street Address:
-----------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
CONTRACTS/NOTIFICATION METHODS:
- -------------------------------
CREDIT CONTACTS:
Primary Contact:
------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
Backup Contact:
------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
<PAGE> 108
TAX WITHHOLDING:
- ----------------
Non Resident Alien _______ Y* _______ N
* Form 4224 Enclosed
Tax ID Number
CONTACTS/NOTIFICATION METHODS:
- ------------------------------
ADMINISTRATIVE CONTACTS - BORROWINGS, PAYDOWNS, INTEREST, FEES, ETC.
Contact:
---------------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
----------------------------------------------------------------
BID LOAN NOTIFICATION:
- ----------------------
Contact:
--------------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
----------------------------------------------------------------
PAYMENT INSTRUCTIONS:
- ---------------------
Name of Bank where funds are to be transferred:
--------------------------------------------------------------------------
Routing Transit/ABA Number of Bank where funds are to be transferred:
--------------------------------------------------------------------------
Name of Account, if applicable:
--------------------------------------------------------------------------
Account Number:
-------------------------------------------------------------
Additional Information:
-----------------------------------------------------
- ------------------------------------------------------------------------------
MAILINGS:
- ---------
Please specify who should receive financial information:
Name:
-----------------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
<PAGE> 109
It is very important that all of the above information is accurately filled
in and returned promptly. If there is someone other than yourself who should
receive this questionnaire, please notify us of their name and FAX number
and we will FAX them a copy of the questionnaire. If you have any questions,
please call at 212-622-0484.
<PAGE> 110
EXHIBIT C
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the 364-day Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (the "Credit Agreement"), among
Westinghouse Electric Corporation, a Pennsylvania corporation, the Lenders
party thereto, the Co-Agents named therein and Chemical Bank, as administrative
agent for the Lenders (in such capacity, the "Administrative Agent"). Terms
defined in the Credit Agreement are used herein with the same meanings.
The Assignor hereby sells and assigns, without recourse, to the Assignee,
and the Assignee hereby purchases and assumes, without recourse, from the
Assignor, effective as of the Effective Date set forth on the reverse hereof,
the interests set forth on the reverse hereof (the "Assigned Interest") in the
Assignor's rights and obligations under the Credit Agreement, including,
without limitation, the interests set forth on the reverse hereof in the
Commitments of the Assignor on the Effective Date [and Competitive Loans],
Swingline Loans and Standby Loans owing to the Assignor which are outstanding
on the Effective Date, together with unpaid interest accrued on the assigned
Loans
<PAGE> 111
2
to the Effective Date and the amount, if any, set forth on the reverse
hereof of the Fees accrued to the Effective Date for the account of the
Assignor. Each of the Assignor and the Assignee hereby makes and agrees to be
bound by all the representations, warranties and agreements set forth in
Section 8.04(c) of the Credit Agreement, a copy of which has been received by
each such party. From and after the Effective Date (i) the Assignee shall be a
party to and be bound by the provisions of the Credit Agreement and, to the
extent of the interests assigned by this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and under the other Loan
Documents and (ii) the Assignor shall, to the extent of the interests assigned
by this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Credit Agreement.
This Assignment and Acceptance is being delivered to the Administrative
Agent together with (i) if the Assignee is organized under the laws of a
jurisdiction outside the United States, the forms specified in Section 2.20(f)
of the Credit Agreement, duly completed and executed by such Assignee, (ii) if
the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form of Exhibit B to the
<PAGE> 112
3
Credit Agreement and (iii) a processing and recordation fee of $3,500.
This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
within such State, without regard to conflicts of law provisions and principles
of such State.
<PAGE> 113
4
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
(may not be fewer than 5 Business
Days after the Date of Assignment):
<TABLE>
<CAPTION>
Percentage Assigned of
Facility/Commitment (set
forth, to at least 8
Principal Amount Assigned decimals, as a percentage of
(and identifying information the Facility and the
as to individual aggregate Commitments of all
Facility Competitive Loans) Lenders thereunder)
-------- ---------------------------- ----------------------------
<S> <C> <C> <C>
Standby
Commitment Assigned $ %
Standby Loans:
Competitive Loans:
Swingline Commitment
Assigned:
</TABLE>
<PAGE> 114
5
Swingline Loans:
Fee Assigned (if any):
The terms set forth above and on the
reverse side hereof are hereby agreed to:
Accepted */
-
_______________ ,as Assignor WESTINGHOUSE ELECTRIC CORPORATION
By:_____________________ By:_____________________
Name: Name:
Title: Title:
Acknowledged */
-
______________, as Assignee CHEMICAL BANK, as administrative agent
By:________________________ By:____________________
Name: Name:
Title: Title:
__________________
*/ To be completed only if consents are required under Section 8.04(b).
-
<PAGE> 115
EXHIBIT D
[FORM OF]
CONFIDENTIALITY AGREEMENT
____________, 199_
Westinghouse Electric Corporation
Westinghouse Building
[Gateway Center]
Pittsburgh, Pennsylvania 15222
Attention of [Executive Vice President,
Finance and Chief Financial Officer]
Ladies and Gentlemen:
Reference is made to the 364-day Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as the same may be amended,
restated, supplemented or otherwise modified from time to time, the
"Agreement"), among Westinghouse Electric Corporation, a Pennsylvania
corporation (the "Borrower"), the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent. Capitalized terms used but
not defined herein have the meanings assigned to them in the Agreement.
In connection with the proposed assignment or participation of certain
interests in the Facility to us pursuant to Section 8.04 of the Agreement, we
may receive information furnished by or on behalf of the Borrower and
designated by or on behalf of the Borrower as confidential (the "Information").
We understand that improper use or disclosure of the Information might
violate applicable Federal and state securities laws (including Rule 10b-5
under the Securities Exchange Act of 1934, as amended) and seriously prejudice
the interests of the Borrower and that the Borrower is entitled to rely on the
promises made herein and to equitable relief, including an injunction, in the
event of our breach. Accordingly, we agree to keep confidential and not to
disclose (and to cause our officers, directors, employees, agents, affiliates
and representatives to keep confidential and not to disclose) and, at your
request (except as provided below), promptly to return to you or
<PAGE> 116
2
destroy the Information and all copies thereof, extracts therefrom and analyses
or other materials based thereon, except that we shall be permitted to disclose
Information and shall agree to be bound by the terms of this Confidentiality
Agreement; (i) to such of our officers, directors, employees, agents and
representatives as need to know such Information in connection with the
proposed assignment or participation referred to above, each of whom shall be
informed by us of the confidential nature of the Information and shall agree to
be bound by the terms of this Confidentiality Agreement; (ii) to the extent
required by applicable laws and regulations or by any subpoena or similar legal
process or requested by any governmental authority or agency having
jurisdiction over us; PROVIDED, however, that prior to such disclosure a
written opinion of counsel to us shall be provided to you to such effect
(except that no opinion will be required for disclosure to bank regulators or
examiners in accordance with customary banking practices or if the provision of
such opinion would violate applicable law); (iii) to the extent such
Information (A) becomes publicly available other than as a result of a breach
of the Agreement or this Confidentiality Agreement, (B) becomes available to us
on a non-confidential basis from a source other than a party to the Agreement
or any other party bound by an agreement similar to this Confidentiality
Agreement or (C) was available to us on a non-confidential basis prior to its
disclosure to us by a party to the Agreement or any other party bound by an
agreement similar to this Confidentiality Agreement; or (iv) to the extent the
Borrower shall have consented to such disclosure in writing.
We further agree that, except to the extent the conditions referred to in
subclause (A), (B) or (C) of clause (iii) above have been met and as provided
in the last paragraph of this letter, (a) we will use the Information only in
connection with our possible participation in the Facility and (b) we will not
use the Information in connection with any other matter or in a manner
prohibited by any law, including, without limitation, the securities laws of
the United States.
Notwithstanding anything to the contrary contained above, if we shall
purchase an assignment of or a participation in the rights of any Lender under
the Agreement, we shall be entitled to retain all Information to use solely for
the purposes of servicing our credit and protecting our rights with regard
thereto.
<PAGE> 117
3
Name of Recipient:
By:
Title:
Institution:
Date:
<PAGE> 118
EXHIBIT E
[FORM OF]
DESIGNATION AGREEMENT
__________, 199_
Reference is made to the 364-day Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as the same may hereafter be
amended, restated, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among Westinghouse Electric Corporation (the "Borrower"),
the Lenders party thereto, the Co-Agents named therein and Chemical Bank, as
Administrative Agent. Capitalized terms used but not defined herein have the
meanings assigned to such terms in the Credit Agreement.
1. The undersigned Lender (the "Designating Lender") hereby designates the
undersigned Eligible Designee (the "Designee") to have the right, subject to
Section 8.17 of the Credit Agreement, to submit Competitive Bids pursuant to
Competitive Bid Requests made under Section 2.03 of the Credit Agreement, and
the Designee hereby accepts such designation.
2. The Designating Lender makes no representation or warranty and assumes
no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other instrument or document furnished
pursuant thereto or(ii) the financial condition of the Borrower or any of its
Subsidiaries or the performance or observance by the Borrower or any of its
Subsidiaries of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto.
3. The Designee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
referred to in Section 3.02 or delivered pursuant to Section 5.01 thereof and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Designation Agreement; (ii)
agrees that it will, independently and without reliance upon the Administrative
<PAGE> 119
2
Agent, the Co-Agents, the Designating Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement; (iii) confirms that it is an Eligible Designee; (iv)
appoints and authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all the obligations which by the terms of the
Credit Agreement are required to be performed by it pursuant to Section 8.17
thereof; and (vi) agrees that the Borrower shall be a third-party beneficiary
of this Agreement.
4. This Designation Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
The terms set forth above
are hereby agreed to: Accepted:
CHEMICAL BANK, as
Administrative Agent
as Designating Lender
By:________________ By:_______________________
Name: Name:
Title: Title:
WESTINGHOUSE ELECTRIC
CORPORATION
as Designee
By:________________ By:_______________________
Name: Name:
Title: Title:
<PAGE> 120
EXHIBIT F
[Form of Opinion of Louis J. Briskman, Esq.,
Senior Vice President and General Counsel
of Westinghouse Electric Corporation]
August [ ], 1994
Chemical Bank, as Administrative Agent,
and each of the Lenders and Co-Agents
party to the Credit Agreement referred to below
270 Park Avenue
New York, NY 10017
Gentlemen:
I am Senior Vice President and General Counsel of Westinghouse Electric
Corporation (the "Company") and in such capacity have represented the Company
in connection with each of the 364-day and the Three-year Competitive Advance
and Revolving CreditFacility Agreements dated as of August 5, 1994,
among the Company, a Pennsylvania corporation, the Lenders party
thereto, the Co-Agents named therein and Chemical Bank, as Administrative
Agent (the "Credit Agreements"). This opinion is rendered to you pursuant
to Section 4.01(a) of each Credit Agreement. Capitalized terms used but
not defined herein shall have the meanings assigned to them in the Credit
Agreements.
In rendering the opinions expressed below, I have examined, either
personally or indirectly through lawyers who report to me or through other
counsel, the originals or conformed copies of such corporate records,
agreements and instruments of the Company and its Material Subsidiaries,
certificates of public officials and of officers of the Company and its
Material Subsidiaries, and such other documents and records as I have deemed
appropriate as a basis for the opinions hereinafter expressed.
Based upon the foregoing, and subject to the qualifications stated herein, I
am of the opinion that:
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the Commonwealth of Pennsylvania and has the
necessary corporate power to make and perform each Credit Agreement and to
borrow under each Credit Agreement. To my
<PAGE> 121
2
knowledge, each of the Company and its Material Subsidiaries is qualified to do
business in all jurisdictions where failure to so qualify would have a material
adverse effect on the consolidated financial condition of the Company and its
Consolidated Subsidiaries.
2. The making and performance and other extensions of credit by the Company
of each Credit Agreement and the borrowings thereunder have been duly authorized
by all necessary corporate action, and do not and will not violate any
provision of law or regulation or any order, writ, injunction or decree of any
court or Governmental Authority or any provision of the Company's articles of
incorporation or by-laws or, to my knowledge, result in the breach of, or
constitute a default or require any consent under, or result in the creation of
any Lien upon any of the revenues or assets of the Company or any of its
Material Subsidiaries pursuant to, any material agreement or instrument to
which the Company or any of its Material Subsidiaries is a party or by which
any of them is bound. Each Credit Agreement has been duly executed and
delivered by the Company effective as of the date hereof.
3. If, contrary to the agreement of the parties, the Credit Agreements were
held to be governed by the laws of the Commonwealth of Pennsylvania, without
regard to the application of conflict or choice of law provisions, each Credit
Agreement, as applicable, would constitute the legal, valid and binding
obligation of the Company enforceable against the Company in accordance with
its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights and
remedies generally, and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity) and subject to the qualification that I express no opinion as to
Section 2.17 of each of the Credit Agreements insofar as it provides that any
Lender purchasing a participation from another Lender pursuant thereto may
exercise set-off or similar rights with respect to such participation.
4. Except as disclosed in the Exchange Act Report or otherwise disclosed in
writing to the Lenders prior to the date hereof, as of the date hereof there
are no legal or arbitral proceedings, or any proceedings by or before any
Governmental Authority, now pending or, to the best of my
<PAGE> 122
3
knowledge, threatened against the Company or any of its Material Subsidiaries
which has resulted or would result, if determined adversely to the Company or
such Material Subsidiary, in a material adverse effect on the consolidated
financial condition of the Company and its Consolidated Subsidiaries.
5. No authorizations, approvals or consents of, and no filings or
registrations with, any Governmental Authority are necessary for the execution,
delivery or performance by the Company of the Credit Agreements.
6. The Company is not an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
7. The Company is not subject to regulation as a "holding company," subject
to regulation as an "affiliate" of a "holding company," or subject to
regulation as a "subsidiary company" of a "holding company," under the Public
Utility Holding Company Act of 1935, as amended.
The foregoing opinions are subject to the following qualifications:
1. I express no opinion as to any matter involving any choice of law or
conflict of laws or as to the effect on matters covered by this opinion of the
laws of any jurisdiction other than the Commonwealth of Pennsylvania and the
United States of America.
2. My opinions as to enforceability are based on the assumption that each
of the Credit Agreements has been duly and validly executed and delivered by
each of the other required parties thereto, and that the Credit Agreements are
each the legal and valid agreement of and binding on each of said parties in
accordance with its terms.
3. These opinions are based on current law and facts and circumstances. I
am not assuming an obligation to revise or supplement this letter should
applicable law or the existing facts and circumstances change.
I am a member of the bar of the Commonwealth of Pennsylvania. In rendering
this opinion, I do not hold myself out to be an expert on or personally
familiar with or qualified to express a legal opinion on matters with respect
to the laws of any jurisdiction other than the laws of the
<PAGE> 123
4
Commonwealth of Pennsylvania and the United States of America, and my opinion
is limited to the laws of Pennsylvania and the United States of America.
This opinion is rendered solely for your benefit in connection with the
transaction described above. This opinion is not to be used or relied upon by
any other party and may not be disclosed, quoted in whole or in part, or
referred to, nor is it to be filed with any governmental agency or other
person, without my prior written consent except as required by law.
Very truly yours,
Louis J. Briskman
<PAGE> 124
EXHIBIT G
FORM OF SWINGLINE BORROWING REQUEST
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the "Borrower"), refers
to the 364-day Competitive Advance and Revolving Credit Facility Agreement
dated as of August 5, 1994 (as it may hereafter be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. The Borrower hereby gives you notice pursuant to Section
2.22 of the Credit Agreement that it requests a Swingline Borrowing under the
Credit Agreement, and in that connection sets forth below the terms on which
such Swingline Borrowing is requested to be made:
(A) Date of Swingline Borrowing
(which is a Business Day)
(B) Principal Amount of
Swingline Borrowing 1/
Upon acceptance of any or all of the Loans made by the Lenders in response
to this request, the Borrower shall be deemed to have represented and warranted
that the
____________________
1/ Not less than $5,000,000 or greater than the Swingline
Commitments then available.
<PAGE> 125
2
conditions to lending specified in Section 4.02(b) and (c) of the Credit
Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by
_____________________________
Title:
<PAGE> 1
Exhibit 10(s)
_______________________________________________________________________________
_______________________________________________________________________________
THREE YEAR COMPETITIVE ADVANCE
AND REVOLVING CREDIT FACILITY AGREEMENT
Dated as of August 5, 1994
among
WESTINGHOUSE ELECTRIC CORPORATION,
as Borrower,
THE CO-AGENTS AND LENDERS NAMED HEREIN
and
CHEMICAL BANK,
as Administrative Agent
_______________________________________________________________________________
_______________________________________________________________________________
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
Article Section Page
- ------- ------- ----
<S> <C> <C>
I. DEFINITIONS
1.01 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 Terms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
II. THE CREDITS
2.01 Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.02 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.03 Competitive Bid Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.04 Standby Borrowing Procedure . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.05 Refinancings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.06 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.07 Repayment of Loans; Evidence of Debt . . . . . . . . . . . . . . . . . . . . . 21
2.08 Interest on Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.09 Default Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.10 Alternate Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.11 Termination and Reduction of
Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.12 Prepayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.13 Reserve Requirements;
Change in Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.14 Change in Legality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.15 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.16 Pro Rata Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.17 Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.18 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.19 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.20 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.21 Termination or Assignment of
Commitments Under Certain
Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
2.22 Swingline Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
III. REPRESENTATIONS AND WARRANTIES
3.01 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.02 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.03 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.04 No Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.05 Corporate Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.06 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.07 Use of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.08 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.09 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
</TABLE>
<PAGE> 3
<TABLE>
Contents, p.2
<S> <C> <C>
3.10 Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.11 Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . 35
3.12 Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.13 Material Subsidiaries, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.14 No Material Misstatements . . . . . . . . . . . . . . . . . . . . . . . . . . 35
IV. CONDITIONS OF EFFECTIVENESS AND LENDING
4.01 Initial Credit Event . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.02 All Credit Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
V. COVENANTS
5.01 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.02 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.03 Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.04 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.05 Prohibition of Fundamental Changes . . . . . . . . . . . . . . . . . . . . . . 40
5.06 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.07 Consolidated Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.08 Consolidated Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.09 Minimum Consolidated
Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.10 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.11 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.12 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
VI. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
VII. THE AGENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
VIII. MISCELLANEOUS
8.01 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
8.02 Survival of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.03 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.04 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.05 Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.06 Right of Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.07 Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.08 Waivers; Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.09 Interest Rate Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
8.10 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
8.11 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
8.12 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
8.13 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.14 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.15 Jurisdiction; Consent to Service
of Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.16 Issuing Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
</TABLE>
<PAGE> 4
<TABLE>
Contents, p.3
<S> <C> <C>
8.17 Designated Bidders . . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.18 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
8.19 Termination of Existing Credit Agreement . . . . . . . . . . . . . . . 54
Exhibit A-1 Form of Competitive Bid Request
Exhibit A-2 Form of Notice of Competitive Bid Request
Exhibit A-3 Form of Competitive Bid
Exhibit A-4 Form of Competitive Bid Accept/Reject Letter
Exhibit A-5 Form of Standby Borrowing Request
Exhibit B Administrative Questionnaire
Exhibit C Form of Assignment and Acceptance
Exhibit D Form of Confidentiality Agreement
Exhibit E Form of Designation Agreement
Exhibit F Form of Opinion of Counsel
Exhibit G Form of Swingline Borrowing Request
Schedule 1.01 Existing Letters of Credit
Schedule 2.01 Commitments
Schedule 3.13 Subsidiaries
</TABLE>
<PAGE> 5
THREE YEAR COMPETITIVE ADVANCE AND REVOLVING
CREDIT FACILITY AGREEMENT entered into as of August
5, 1994 (this "AGREEMENT"), among WESTINGHOUSE
ELECTRIC CORPORATION, a Pennsylvania corporation (the
"BORROWER"); the lenders whose names appear on the
signature pages hereto or who subsequently become
parties hereto as provided herein (the "LENDERS");
ABN AMRO Bank N.V., Bank of Montreal, The Bank of New
York, The Bank of Nova Scotia, Barclays Bank PLC,
Citibank, N.A., Continental Bank, Credit Lyonnais New
York Branch, Credit Suisse, The Dai-Ichi Kangyo Bank,
Ltd., Deutsche Bank AG New York Branch and/or Cayman
Islands Branch, The First National Bank of Chicago,
The Fuji Bank, Limited, New York Branch, The
Industrial Bank of Japan, Limited, New York Branch,
LTCB Trust Company, Mellon Bank, N.A., The Mitsubishi
Bank, Limited--New York Branch, The Mitsubishi Trust
and Banking Corporation, Morgan Guaranty Trust
Company of New York, NationsBank N.C., N.A., PNC
Bank, National Association, Sanwa Bank Limited,
Societe Generale, The Sumitomo Bank, Limited, The
Toronto-Dominion Bank and Union Bank of Switzerland
(collectively, the "CO-AGENTS"); and CHEMICAL BANK,
a New York banking corporation, as administrative
agent for the Lenders (in such capacity, the
"ADMINISTRATIVE AGENT"; the Administrative Agent and
the Co-Agents being collectively called the
"AGENTS").
The Borrower has requested the Lenders, subject to the conditions set
forth herein, (a) to extend credit in order to enable it to borrow on a
revolving credit basis on and after the date hereof and prior to the Maturity
Date (as herein defined) a principal amount not in excess of $2,000,000,000 at
any time outstanding minus the Aggregate LC Exposure (as herein defined) and
(b) to provide a procedure pursuant to which it may invite the Lenders to bid
on an uncommitted basis on short-term borrowings by it. The proceeds of such
borrowings are to be used, together with the proceeds of borrowings under the
Facility A Credit Agreement (as defined herein), to repay in full amounts
outstanding under the Existing Credit Agreement (as defined herein), to provide
working capital and for other general corporate purposes. The Borrower has
further requested the Lenders to provide for the issuance of Letters of Credit
(as herein defined) in an aggregate face amount at any time not to exceed the
lesser of the then Total Commitment (as defined herein) and $1,000,000,000. The
Lenders are willing to extend credit to the Borrower on the terms and subject
to the conditions herein set forth.
Accordingly, the Borrower, the Lenders and the Agents agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms shall have the meanings specified below:
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any Standby Loan or Swingline Loan bearing
interest at a rate determined by reference to the Alternate Base Rate in
accordance with the provisions of Article II.
"ADJUSTED CASH AND CASH EQUIVALENTS" shall mean, with respect to the
Borrower and its Consolidated Subsidiaries, (a) all cash and Cash Equivalents
of such entities (other than any cash and Cash Equivalents of such entities
which are subject to Liens securing obligations of such entities or of other
<PAGE> 6
2
persons), carried at no greater than the fair market value thereof, minus (b)
the sum of (i) the estimated taxes that would be payable by such entities in
the event cash and Cash Equivalents held by the Borrower or any of its
Consolidated Subsidiaries in Puerto Rico were transferred to deposit accounts
of the Borrower in the continental United States and (ii) $75,000,000.
"ADJUSTED CD RATE" shall mean, with respect to any CD Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/100 of 1%) equal to the sum of (a) a rate per annum equal to the
product of (i) the Fixed CD Rate in effect for such Interest Period and (ii)
Statutory Reserves, plus (b) the Assessment Rate. For purposes hereof, the term
"FIXED CD RATE" shall mean the arithmetic average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the prevailing rates per annum bid at or
about 10:00 a.m., New York City time, to each Reference Bank on the first
Business Day of the Interest Period applicable to such CD Borrowing by three
New York City negotiable certificate of deposit dealers of recognized standing
for the purchase at face value of negotiable certificates of deposit of such
Reference Bank in a principal amount approximately equal to such Reference
Bank's portion of such CD Borrowing and with a maturity comparable to such
Interest Period.
"ADJUSTED CONSOLIDATED NET WORTH" shall mean, at any time, (a)
Consolidated Net Worth at such time plus (b) the amount of any reduction in
such Consolidated Net Worth to reflect all non-cash charges (including those
related to restructuring, litigation and loss on the sale of business), all net
of tax effects and computed and consolidated in accordance with GAAP.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in the form of Exhibit B hereto.
"AFFILIATE" shall mean, as to the Borrower, any person which directly
or indirectly controls, is under common control with or is controlled by the
Borrower. As used in this definition, "CONTROL" (including, with correlative
meanings, "CONTROLLED BY" and "UNDER COMMON CONTROL WITH") shall mean
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise), provided
that, in any event, any person which owns directly or indirectly 10% or more of
the securities having ordinary voting power for the election of directors or
other governing body of a corporation or 10% or more of the partnership or
other ownership interests of any other person (other than as a limited partner
of such other person) will be deemed to control such corporation or other
person. Notwithstanding the foregoing, (i) no individual shall be deemed to be
an Affiliate of the Borrower solely by reason of his or her being an officer,
director or employee of the Borrower or any of its Subsidiaries, (ii) the
Borrower and its Subsidiaries shall not be deemed to be Affiliates of each
other and (iii) no person of which the Borrower or any of its Subsidiaries
acquires or has acquired control in connection with or as a consequence of any
debt or equity financing provided to such person in the ordinary course of
business of WFSI, any of its Subsidiaries, Financial Services or WCI shall be
deemed an Affiliate of the Borrower.
"AGENT FEES" shall have the meaning assigned to such term in Section
2.06(c).
"AGGREGATE LC EXPOSURE" shall mean, at any time, the sum of (a) the
aggregate undrawn amount of all Letters of Credit outstanding at such time plus
(b) the aggregate amount which has been drawn under Letters of Credit but for
which the applicable Issuing Bank or the Lenders, as the case may be, have not
been reimbursed by the Borrower at such time.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greater of
(a) the Prime Rate in effect on such day and (b) the Federal Funds Effective
Rate in effect on such day plus 1/2 of 1%. For purposes hereof, "PRIME RATE"
shall mean the rate of interest per annum publicly announced from time to time
by the Lender serving as Administrative Agent as its prime rate in effect at
its principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced as effective; and
"FEDERAL
<PAGE> 7
3
FUNDS EFFECTIVE RATE" shall mean, for any day, 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 on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the
average of the quotations for the day of such transactions received by
the Administrative Agent from three Federal funds brokers of recognized
standing selected by it. If for any reason the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms thereof, the Alternate Base
Rate shall be the Prime Rate until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a
change in the Prime Rate or the Federal Funds Effective Rate shall be effective
on the effective date of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"APPLICABLE FACILITY FEE PERCENTAGE" shall mean on any date the
applicable percentage set forth below based upon the ratings applicable on such
date to the Borrower's senior, unsecured, non-credit-enhanced long-term
indebtedness for borrowed money ("INDEX DEBT"):
<TABLE>
PERCENTAGE
----------
<S> <C>
CATEGORY 1 .125%
----------
Rating
------
A- or higher by S&P
A3 or higher by Moody's
A- or higher by Fitch
CATEGORY 2 .150%
----------
Rating
------
BBB+ by S&P
Baa1 by Moody's
BBB+ by Fitch
CATEGORY 3 .200%
----------
Rating
------
BBB by S&P
Baa2 by Moody's
BBB by Fitch
CATEGORY 4 .250%
----------
Rating
------
BBB- by S&P
Baa3 by Moody's
BBB- by Fitch
</TABLE>
<PAGE> 8
<TABLE> 4
<S> <C>
CATEGORY 5 .375%
----------
Rating
------
BB+ or lower by S&P
Ba1 or lower by Moody's
BB+ or lower by Fitch
</TABLE>
For purposes of the foregoing, (i) if the ratings established or deemed to have
been established by Moody's, S&P and Fitch shall fall within different
Categories, the rating (or one of the ratings) in the numerically highest
Category shall be disregarded, and if the remaining two ratings shall fall
within different Categories, both of such ratings shall be deemed to fall
within the numerically higher of such Categories; (ii) if Moody's, S&P or Fitch
shall not have in effect a rating for Index Debt (other than because such
rating agency shall no longer be in the business of rating corporate debt
obligations), then such rating agency will be deemed to have established a
rating for Index Debt of Ba1, BB+ or BB+, respectively; and (iii) if any rating
established or deemed to have been established by Moody's, S&P or Fitch shall
be changed (other than as a result of a change in the rating system of Moody's,
S&P or Fitch), such change shall be effective as of the date on which it is
first announced by the applicable rating agency. Each change in the Applicable
Facility Fee Percentage shall apply during the period commencing on the
effective date of such change and ending on the date immediately preceding the
effective date of the next such change. If the rating system of Moody's, S&P or
Fitch shall change, or if any such rating agency shall cease to be in the
business of rating corporate debt obligations, the Borrower and the Lenders
shall negotiate in good faith to amend the references to specific ratings in
this definition to reflect such changed rating system or the non-availability
of ratings from such rating agency.
"APPLICABLE MARGIN" shall mean on any date, with respect to the Loans
comprising any Eurodollar Borrowing or CD Borrowing, as the case may be, the
applicable spread set forth below based upon the ratings applicable on such
date to the Index Debt:
<TABLE>
<S> <C> <C>
EURODOLLAR CD LOAN
LOAN SPREAD SPREAD
----------- -------
CATEGORY 1 .250% .375%
- ----------
Rating
------
A- or higher by S&P
A3 or higher by Moody's
A- or higher by Fitch
CATEGORY 2 .350% .475%
- ----------
Rating
------
BBB+ by S&P
Baa1 by Moody's
BBB+ by Fitch
</TABLE>
<PAGE> 9
5
<TABLE>
<S> <C> <C>
CATEGORY 3 .425% .550%
- ----------
Rating
------
BBB by S&P
Baa2 by Moody's
BBB by Fitch
CATEGORY 4 .500% .625%
- ----------
Rating
------
BBB- by S&P
Baa3 by Moody's
BBB- by Fitch
CATEGORY 5 .625% .750%
- ----------
Rating
------
BB+ or lower by S&P
Ba1 or lower by Moody's
BB+ or lower by Fitch
</TABLE>
For purposes of the foregoing, (i) if the ratings established or deemed to have
been established by Moody's, S&P and Fitch shall fall within different
Categories, the rating (or one of the ratings) in the numerically highest
Category shall be disregarded, and if the remaining two ratings shall fall
within different Categories, both of such ratings shall be deemed to fall
within the numerically higher of such Categories; (ii) if Moody's, S&P or Fitch
shall not have in effect a rating for Index Debt (other than because such
rating agency shall no longer be in the business of rating corporate debt
obligations), then such rating agency will be deemed to have established a
rating for Index Debt of Ba1, BB+ or BB+, respectively; and (iii) if any rating
established or deemed to have been established by Moody's, S&P or Fitch shall
be changed (other than as a result of a change in the rating system of Moody's,
S&P or Fitch), such change shall be effective as of the date on which it is
first announced by the applicable rating agency. Each change in the Applicable
Margin shall apply during the period commencing on the effective date of such
change and ending on the date immediately preceding the effective date of the
next such change. If the rating system of Moody's, S&P or Fitch shall change,
or if any such rating agency shall cease to be in the business of rating
corporate debt obligations, the Borrower and the Lenders shall negotiate in
good faith to amend the references to specific ratings in this definition to
reflect such changed rating system or the non-availability of ratings from such
rating agency.
"APPLICABLE PERCENTAGE" of any Lender at any time shall mean the
percentage of the aggregate Standby Commitments (or, following any termination
of all the Standby Commitments, the Standby Commitments most recently in
effect) represented by such Lender's Standby Commitment (or, following any such
termination, the Standby Commitment of such Lender most recently in effect).
"ASSESSMENT RATE" shall mean for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will
be employed in determining amounts payable by the Lender serving as
Administrative Agent to the Federal Deposit Insurance Corporation (or any
successor) for insurance by such Corporation (or such successor) of time
deposits made in dollars at such Lender's domestic offices.
<PAGE> 10
6
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit C.
"BOARD" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"Borrowing" shall mean a group of Loans of a single Type made by the
Lenders (or, in the case of a Competitive Borrowing, by the Lender or Lenders
whose Competitive Bids have been accepted pursuant to Section 2.03) to the
Borrower on a single date and as to which a single Interest Period is in
effect.
"BUSINESS DAY" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of New York) on which banks are
open for business in New York City; PROVIDED, HOWEVER, that, when used in
connection with a Eurodollar Loan, the term "BUSINESS DAY" shall also exclude
any day on which banks are not open for dealings in dollar deposits in the
London interbank market.
"CAPITAL LEASE OBLIGATIONS" of any person shall mean the obligations
of such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.
"CASH EQUIVALENTS" shall mean (a) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America or by the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation, the Federal Home Loan Banks, the Farm Credit
Banks, the Student Loan Marketing Association or the Government National
Mortgage Association), in each case maturing within one year; (b) investments
in commercial paper maturing within 270 days and having, at such date of
acquisition, a rating of at least "P-1" from Moody's or "A-1" from S&P; (c)
investments in certificates of deposit, banker's acceptances and time deposits
maturing within 270 days issued or guaranteed by or placed with, and any money
market deposit accounts issued or offered by, any foreign bank headquartered in
Canada, France, Germany, Japan, The Netherlands, Switzerland, Italy or the
United Kingdom or any office of any commercial bank organized under the laws of
the United States of America or any State or possession thereof or the
Commonwealth of Puerto Rico having a combined capital and surplus and undivided
profits of not less than $250,000,000; (d) investments in repurchase agreements
with any commercial bank referred to in item (c) above or any investment bank
having a credit rating of "A" or better from Moody's or S&P or whose commercial
paper has a rating of at least "P-1" from Moody's or "A-1" from S&P with
respect to obligations of the type referred to in item (a), (b) or (c) above
(except that in the case of direct obligations of, or obligations the principal
of and interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are backed
by the full faith and credit of the United States of America or by the Federal
National Mortgage Association, the Federal Home Loan Mortgage Corporation, the
Federal Home Loan Banks, the Farm Credit Banks, the Student Loan Marketing
Association or the Government National Mortgage Association), such obligations
may have maturities of up to 5 years from the date of the repurchase
agreement), PROVIDED that (i) such obligations have a market value at the time
of purchase not less than the repurchase price to be paid under such repurchase
agreement, (ii) such repurchase agreement is secured by such obligations and
(iii) such repurchase agreement requires repurchase thereunder within one year;
(e) direct obligations (general or limited) of any state of the United States
of America or any political subdivision thereof or other governmental authority
maturing within one year and having a credit rating of "A" or better from
Moody's or S&P; and (f) other investment instruments approved in writing by the
Required Lenders.
<PAGE> 11
7
"CD BORROWING" shall mean a Borrowing comprised of CD Loans.
"CD LOAN" shall mean any Standby Loan bearing interest at a rate
determined by reference to the Adjusted CD Rate in accordance with the
provisions of Article II.
"CHANGE OF CONTROL" shall mean that any person or group of persons
(within the meaning of Sections 13 and 14 of the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), and the rules and regulations of the SEC
relating to such sections) shall have acquired beneficial ownership (within the
meaning of Rules 13d-3 and 13d-5 promulgated by the SEC pursuant to the
Exchange Act) of 25% or more of the outstanding shares of voting stock of the
Borrower.
"CLOSING DATE" shall mean August 5, 1994.
"CODE" shall mean the Internal Revenue Code of 1986, as the same may
be amended from time to time.
"COMMITMENTS" shall mean, with respect to each Lender, such Lender's
Standby Commitment, LC Commitment and Swingline Commitment, if any. The
Commitments shall automatically and permanently terminate on the Maturity Date.
"COMPETITIVE BID" shall mean an offer to make a Competitive Loan
pursuant to Section 2.03.
"COMPETITIVE BID ACCEPT/REJECT LETTER" shall mean a notification made
by the Borrower pursuant to Section 2.03(d) in the form of Exhibit A-4.
"COMPETITIVE BID RATE" shall mean, as to any Competitive Bid made
pursuant to Section 2.03(b), (a) in the case of a Eurodollar Competitive Loan,
the Margin, and (b) in the case of a Fixed Rate Loan, the fixed rate of
interest offered by the Lender or Designated Bidder making such Competitive
Bid.
"COMPETITIVE BID REQUEST" shall mean a request made pursuant to
Section 2.03 in the form of Exhibit A-1.
"COMPETITIVE BORROWING" shall mean a Borrowing consisting of a
Competitive Loan or concurrent Competitive Loans from the Lender or Lenders (or
Designated Bidder or Bidders) whose Competitive Bid or Bids for such Borrowing
have been accepted by the Borrower under the bidding procedure described in
Section 2.03.
"COMPETITIVE LOAN" shall mean a Loan from a Lender or Designated
Bidder to the Borrower pursuant to the bidding procedure described in Section
2.03. Each Competitive Loan shall be a Eurodollar Competitive Loan or a Fixed
Rate Loan.
"CONFIDENTIALITY AGREEMENT" shall mean a confidentiality agreement
substantially in the form of Exhibit D, with such changes as the Borrower may
approve.
"CONSOLIDATED COVERAGE RATIO" shall mean, with respect to the Borrower
and its Consolidated Subsidiaries for any period, the ratio of (a) Consolidated
EBITDA for such period to (b) Consolidated Interest Expense for such period.
"CONSOLIDATED EBITDA" shall mean, with respect to the Borrower and its
Consolidated Subsidiaries for any period, (a) the sum for such period of (i)
Consolidated Net Income (less any items of non-cash income of the Borrower and
its Consolidated Subsidiaries which individually exceed $50,000,000
<PAGE> 12
8
and are not in the aggregate material in the context of Consolidated EBITDA),
(ii) Consolidated Interest Expense, (iii) provision for Federal, state and local
taxes (except to the extent any such provision relates to the Excluded Charge
and is included in the amount of the Excluded Charge for purposes of subclause
(vi)(z) below), (iv) depreciation expense, (v) amortization expense and (vi)
other non-cash items (including (x) provisions for losses and additions to
valuation allowances, (y) the items referred to in clauses (iii) through (vi)
with respect to Discontinued Operations and (z) the Excluded Charge) (provided
that amounts shall only be added pursuant to clauses (ii) through (vi) above to
the extent such amounts were deducted in computing Consolidated Net Income for
such period), minus (b) cash payments made during each period in respect of the
Excluded Charge.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, (a) the
gross interest expense of the Borrower and its Consolidated Subsidiaries
(excluding the amortization of deferred financing charges but including the
gross interest expense of the Discontinued Operations, other than the
amortization of deferred financing charges) for such period minus (b) the
interest income for such period attributable to Adjusted Cash and Cash
Equivalents of the Borrower and its Consolidated Subsidiaries (including such
interest income of the Discontinued Operations), computed and consolidated in
accordance with GAAP.
"CONSOLIDATED LEVERAGE RATIO" shall mean, with respect to the Borrower
and its Consolidated Subsidiaries at any time, the ratio of Consolidated Total
Funded Indebtedness to Adjusted Consolidated Net Worth.
"CONSOLIDATED NET INCOME" with respect to the Borrower and its
Consolidated Subsidiaries shall mean for any period the aggregate net income
(or net deficit) of such persons (including that related to the Discontinued
Operations) minus gains on the sale of assets (other than (i) inventory sold in
the ordinary course of business, (ii) gains on exercises or sales of existing
portfolio warrants or equity investments of Financial Services and (iii) gains
on sales of assets less than $5,000,000 individually and less than $50,000,000
in the aggregate during any fiscal year) and extraordinary gains, computed and
consolidated in accordance with GAAP.
"CONSOLIDATED NET WORTH" shall mean, at any time, (a) the total
shareholders' equity of the Borrower and its Consolidated Subsidiaries plus (b)
the amount of any reduction in such total shareholders' equity to reflect
changes in pension liabilities pursuant to SFAS 87 and SFAS 88, all net of tax
effect and computed and consolidated in accordance with GAAP.
"CONSOLIDATED SUBSIDIARY" shall mean, as to any person, each
Subsidiary of such person (whether now existing or hereafter created or
acquired) the financial statements of which shall be consolidated with the
financial statements of such person in accordance with GAAP.
"CONSOLIDATED TOTAL FUNDED INDEBTEDNESS" shall mean, with respect to
the Borrower and its Consolidated Subsidiaries at any date, (a) the sum at such
date of (i) all indebtedness for borrowed money (including commercial paper),
(ii) all indebtedness for the deferred purchase price of property or services
(other than trade accounts payable and accruals in the ordinary course of
business), (iii) all Capital Lease Obligations and (iv) the amount of any
indebtedness for borrowed money secured by receivables sold by the Borrower and
its Consolidated Subsidiaries pursuant to a program established for the purpose
of financing such receivables, minus (b) the Adjusted Cash and Cash Equivalents
of the Borrower and its Consolidated Subsidiaries.
"COVERAGE PERIOD" shall mean, at any date, the most recent period of
four consecutive fiscal quarters of the Borrower ended not fewer than 50 days
(or 95 days at any time after the end of a fiscal year of the Borrower and
prior to the date on which audited financial statements are required to be
delivered in respect of such year pursuant to Section 5.01(b)) prior to such
date.
<PAGE> 13
9
"CREDIT EVENT" shall mean any Borrowing [or issuance of a Letter of
Credit]3/ hereunder.
"DEFAULT" shall mean any Event of Default or event or condition which
upon notice, lapse of time or both would constitute an Event of Default.
"DESIGNATED BIDDER" shall mean an Eligible Designee that shall have
become a Designated Bidder pursuant to Section 8.17.
"DESIGNATING LENDER" shall mean, as to each Designated Bidder, the
Lender which shall have designated such Designated Bidder pursuant to Section
8.17.
"DESIGNATION AGREEMENT" shall mean a designation agreement
substantially in the form of Exhibit E executed by a Designating Lender and an
Eligible Designee.
"DISCONTINUED OPERATIONS" shall mean the discontinued operations of
the Borrower and its subsidiaries as set forth in the 1992 Financial Statements
and any additional business classified subsequent to December 31, 1992 as
Discontinued Operations.
"DOLLARS" or "$" shall mean lawful money of the United States of
America.
"ELIGIBLE DESIGNEE" shall mean (a) any bank or financial institution
and (b) any special purpose corporation engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its business
that issues (or the parent of which issues) commercial paper rated at least
"P-1" by Moody's or "A-1" by S&P or having a comparable rating from the
successor of either such rating agency, and that in either case (i) is
organized under the laws of the United States or any state thereof, (ii) is not
a Lender and (iii) is acceptable to the Borrower (such acceptance not to be
unreasonably withheld).
"ENVIRONMENTAL LAWS" shall mean any and all Federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
other governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment, including, without limitation, ambient air, surface water, ground
water or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or industrial, toxic or hazardous
substances or wastes.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) that is a member of a group of which the Borrower is a member and
which is treated as a single employer under Section 414 of the Code.
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of one or more
Eurodollar Loans.
"EURODOLLAR COMPETITIVE BORROWING" shall mean a Borrowing comprised of
one or more Eurodollar Competitive Loans.
"EURODOLLAR COMPETITIVE LOAN" shall mean any Competitive Loan bearing
interest at a rate determined by reference to the LIBO Rate in accordance with
the provisions of Article II.
<PAGE> 14
10
"EURODOLLAR LOAN" shall mean any Eurodollar Competitive Loan or
Eurodollar Standby Loan.
"EURODOLLAR STANDBY BORROWING" shall mean a Borrowing comprised of one
or more Eurodollar Standby Loans.
"EURODOLLAR STANDBY LOAN" shall mean any Standby Loan bearing interest
at a rate determined by reference to the LIBO Rate in accordance with the
provisions of Article II.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Article VI.
"EXCLUDED CHARGE" shall mean the Borrower's fourth fiscal quarter 1993
charge to earnings in the amount, on a pre-tax basis, of $750,000,000, and
other similar non-cash charges taken by the Borrower in subsequent periods.
"EXISTING CREDIT AGREEMENT" shall mean the Amended and Restated
Competitive Advance and Revolving Credit Facility Agreement dated as of May 3,
1993, as amended, among the Borrower, the lenders party thereto and co-agents
named therein and Chemical Bank, as Administrative Agent.
"EXISTING LETTERS OF CREDIT" shall mean each letter of credit that (a)
was issued under the Existing Credit Agreement, (b) is outstanding on the
Closing Date and (c) is listed on Schedule 1.01.
"FACILITY A CREDIT AGREEMENT" shall mean the 364-day Competitive
Advance and Revolving Credit Facility Agreement dated as of the date hereof
among the Borrower, the lenders party thereto and co-agents named therein and
Chemical Bank, as administrative agent for the lenders.
"FACILITY FEE" shall have the meaning assigned to such term in Section
2.06(a).
"FEDERAL FUNDS EFFECTIVE RATE" shall have the meaning assigned thereto
in the definition of Alternate Base Rate.
"FEE LETTER" shall mean any commitment letter or other letter
agreement (including any schedules or exhibits thereto) between the Borrower
and the Administrative Agent or any Co-Agent providing for the payment of fees
or other amounts in connection with the credit facilities established by this
Agreement.
"FEES" shall mean the Facility Fee, the Agent Fees, the Issuing Bank
Fees and the LC Fees.
"FINANCIAL OFFICER" of any corporation shall mean its chief financial
officer, its Vice President and Treasurer or its Vice President and Controller
or, in each case, any comparable officer or any person designated by any such
officer.
"FINANCIAL SERVICES" shall mean those operations designated as the
Financial Services portion of Discontinued Operations in the audited
consolidated financial statements of the Borrower at December 31, 1993.
"FITCH" shall mean Fitch Investors Service Inc.
"FIXED RATE BORROWING" shall mean a Borrowing comprised of one or more
Fixed Rate Loans.
"FIXED RATE LOAN" shall mean any Competitive Loan bearing interest at
a fixed percentage rate per annum (expressed in the form of a decimal to no
more than four decimal places) specified by the Lender making such Loan in its
Competitive Bid.
<PAGE> 15
11
"FSC" shall mean a subsidiary of the Borrower or any of its
Subsidiaries which is a FSC as defined in Section 922 of the Code, or in any
successor provision, and which is used solely for the purpose of a single lease
project or lease transaction or related lease projects or lease transactions
and is not related to property predominantly manufactured by the Borrower or
any of its Subsidiaries.
"GAAP" shall mean generally accepted accounting principles applied on
a consistent basis (but subject to changes approved by the Borrower's
independent public accountants).
"GOVERNMENTAL AUTHORITY" shall mean any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.
"GUARANTEE" of or by any person shall mean any obligation, contingent
or otherwise, of such person guaranteeing or entered into with the purpose of
guaranteeing any Indebtedness of any other person (the "PRIMARY OBLIGOR") in
any manner, whether directly or indirectly, and including any obligation of
such person, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or to purchase (or to
advance or supply funds for the purchase of) any security for the payment of
such Indebtedness, (b) to purchase property, securities or services for the
purpose of assuring the owner of such Indebtedness of the payment of such
Indebtedness or (c) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness; PROVIDED, HOWEVER, that
the term Guarantee shall not include endorsements for collection or deposit, in
either case in the ordinary course of business.
"INDEBTEDNESS" of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such person
upon which interest charges are customarily paid, (d) all obligations of such
person under conditional sale or other title retention agreements relating to
property or assets purchased by such person, (e) all obligations of such person
issued or assumed as the deferred purchase price of property or services, (f)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such person, whether or not the
obligations secured thereby have been assumed, (g) all Guarantees by such
person of Indebtedness of others, (h) all Capital Lease Obligations of such
person and (i) all obligations of such person as an account party in respect of
outstanding letters of credit (whether or not drawn) and bankers' acceptances;
PROVIDED, HOWEVER, that Indebtedness shall not include (i) trade accounts
payable arising in the ordinary course of business, (ii) deferred compensation
or (iii) any Indebtedness of such person (other than any such person that is a
FSC) to the extent (A) such Indebtedness does not appear on the financial
statements of such person, (B) such Indebtedness is recourse only to certain
assets of such person and (C) the assets to which such Indebtedness is recourse
only appear on the financial statements of such person net of such
Indebtedness; and PROVIDED FURTHER that the amount of any Indebtedness in
clause (f) shall be the lower of the amount of the obligation or the fair
market value of the collateral securing such obligation. The Indebtedness of
any person shall include the Indebtedness of any partnership in which such
person is a general partner, which Indebtedness is recourse to such general
partner.
"INDEX DEBT" shall have the meaning assigned thereto in the definition
of Applicable Facility Fee Percentage.
"INTEREST PAYMENT DATE" shall mean, with respect to any Loan, the last
day of the Interest Period applicable thereto and, in the case of a Eurodollar
Loan with an Interest Period of more than three months' duration or a Fixed
Rate Loan or a CD Loan with an Interest Period of more than 90 days' duration,
each day that would have been an Interest Payment Date for such Loan had
successive Interest Periods of three months' duration or 90 days duration, as
the case may be, been applicable to such Loan and, in
<PAGE> 16
12
addition, the date of any refinancing or conversion of such Loan with or to a
Loan of a different Type, the date of prepayment of such Loan and the Maturity
Date.
"INTEREST PERIOD" shall mean (a) as to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing or on the last day of the
immediately preceding Interest Period applicable to such Borrowing, as the case
may be, and ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month that is
1, 2, 3, 6 or, subject to the agreement of each Lender, 9 or 12 months
thereafter, as the Borrower may elect, (b) as to any CD Borrowing, a period of
30, 60, 90, 180 or, subject to the agreement of each Lender, 270 or 360 days'
duration, as the Borrower may elect, commencing on the date of such Borrowing,
(c) as to any ABR Borrowing (other than a Swingline Borrowing), the period
commencing on the date of such Borrowing and ending on the date 90 days
thereafter or, if earlier, on the Maturity Date or the date of prepayment of
such Borrowing, (d) as to any Swingline Borrowing, the period commencing on the
date of such Swingline Borrowing and ending on the earlier of (i) the day that
is five Business Days thereafter and (ii) the Maturity Date, and (e) as to any
Fixed Rate Borrowing, the period commencing on the date of such Borrowing and
ending on the date specified in the Competitive Bids in which the offer to make
the Fixed Rate Loans comprising such Borrowing were extended, which shall not
be earlier than seven days after the date of such Borrowing or later than 360
days after the date of such Borrowing; PROVIDED, HOWEVER, that if any Interest
Period would end on a day other than a Business Day, such Interest Period shall
be extended to the next succeeding Business Day unless, in the case of
Eurodollar Loans only, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.
"ISSUING BANK" shall mean any commercial bank designated as an Issuing
Bank in an Issuing Bank Agreement executed by such bank, the Borrower and the
Administrative Agent.
"ISSUING BANK AGREEMENT" shall mean an agreement executed by an
Issuing Bank, the Borrower and the Administrative Agent pursuant to which such
Issuing Bank agrees to become an Issuing Bank hereunder.
"ISSUING BANK FEES" shall mean, as to any Issuing Bank, the fees set
forth in the applicable Issuing Bank Agreement.
"LC COMMITMENT" shall mean, with respect to each Lender, the
commitment of such Lender to acquire participations in Letters of Credit
hereunder as set forth in Section 2.19.
"LC DISBURSEMENT" shall mean any payment or disbursement made by an
Issuing Bank under or pursuant to a Letter of Credit.
"LC EXPOSURE" shall mean, as to each Lender, such Lender's pro rata
share, based upon its Commitment, of the Aggregate LC Exposure.
"LC FEE" shall have the meaning assigned such term in Section 2.06(b).
"LETTERS OF CREDIT" shall mean (a) letters of credit issued by an
Issuing Bank for the account of the Borrower pursuant to Section 2.19 and (b)
the Existing Letters of Credit.
"LIBO RATE" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the average of the rates at which dollar
deposits approximately equal in principal amount to (i) in the case of a
Standby
<PAGE> 17
13
Borrowing, the portion of such Eurodollar Borrowing of the Lender serving as
Administrative Agent and (ii) in the case of a Competitive Borrowing,
a principal amount that would have been the portion of such Competitive
Borrowing of the Lender serving as Administrative Agent had such Competitive
Borrowing been a Standby Borrowing, and for a maturity comparable to such
Interest Period are offered by the principal London offices of the
Reference Banks (or, if any Reference Bank does not at the time maintain
a London office, the principal London office of any affiliate of such
Reference Bank) for immediately available funds in the London
interbank market at approximately 11:00 a.m., London time, two Business Days
prior to the commencement of such Interest Period.
"LIEN" shall mean, with respect to any asset or property, (a) any
mortgage, deed of trust, lien, pledge, encumbrance, charge or security interest
in or on such asset or property and (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement relating to such asset or property.
"LOAN" shall mean a Competitive Loan, a Swingline Loan or a Standby
Loan, whether made as a Eurodollar Loan, a CD Loan, an ABR Loan or a Fixed Rate
Loan, as permitted hereby.
"LOAN DOCUMENTS" shall mean this Agreement, the Fee Letters, the
Issuing Bank Agreements and the Designation Agreements, and any amendment,
restatement, supplement, modification or waiver of, to or in respect of any of
the foregoing.
"MARGIN" shall mean, as to any Eurodollar Competitive Loan, the margin
(expressed as a percentage rate per annum in the form of a decimal to no more
than four decimal places) to be added to or subtracted from the LIBO Rate in
order to determine the interest rate applicable to such Loan, as specified in
the Competitive Bid relating to such Loan.
"MARGIN STOCK" shall have the meaning given such term under
Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean (a) a material adverse effect on
the Property, business, results of operations or financial condition of the
Borrower and its Subsidiaries taken as a whole or (b) material impairment of
the ability of the Borrower to perform any of its obligations hereunder.
"MATERIAL SUBSIDIARY" shall mean any Subsidiary of the Borrower except
for Subsidiaries which in the aggregate would not constitute a significant
subsidiary under Regulation S-X of the SEC.
"MATURITY DATE" shall mean August 4, 1997.
"MOODY'S" shall mean Moody's Investors Service, Inc.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan as defined in
Section 3(37) of ERISA to which contributions have been made by the Borrower or
any ERISA Affiliate of the Borrower and which is covered by Title IV of ERISA.
"1992 FINANCIAL STATEMENTS" shall mean the audited consolidated
financial statements of the Borrower and its subsidiaries as of and for the
year ended December 31, 1992 as set forth in the Annual Report on Form 10-K/A
of the Borrower.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to
and defined in ERISA.
"PERSON" shall mean any natural person, corporation, business trust,
joint venture, association, company, partnership or government, or any agency
or political subdivision thereof.
<PAGE> 18
14
"PLAN" shall mean any employee pension benefit plan as defined in
Section 3(2) of ERISA (other than a Multiemployer Plan) subject to the
provisions of Title IV of ERISA or Section 412 of the Code and which is
maintained for employees of the Borrower or any ERISA Affiliate.
"PROPERTY" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"REFERENCE BANKS" shall mean Chemical Bank, Union Bank of Switzerland
and NationsBank N.C., N.A..
"REGISTER" shall have the meaning given such term in Section 8.04(d).
"REGULATION D" shall mean Regulation D of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION G" shall mean Regulation G of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REQUIRED LENDERS" shall mean, at any time, Lenders having Standby
Commitments (whether or not used) representing at least a majority of the Total
Commitment or, for purposes of acceleration of the Loans pursuant to clause
(ii) of Article VI or following termination of the Commitments, Lenders holding
Loans and LC Exposure representing at least a majority of the aggregate
principal amount of the Loans outstanding and the Aggregate LC Exposure.
"RESPONSIBLE OFFICER" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof responsible for the administration of the obligations
of such corporation in respect of this Agreement (or, in the case of matters
relating to ERISA, any officer responsible for the administration of the
pension funds of such corporation).
"S&P" shall mean Standard & Poor's Corporation.
"SEC" shall mean the Securities and Exchange Commission.
"STANDBY BORROWING" shall mean a group of Standby Loans made by the
Lenders on a single date.
"STANDBY BORROWING REQUEST" shall mean a request made pursuant to
Section 2.04 in the form of Exhibit A-5.
"STANDBY COMMITMENT" shall mean, with respect to each Lender, the
commitment of such Lender to make Standby Loans pursuant to Section 2.01 as
set forth on Schedule 2.01, as such Lender's Standby Commitment may be
permanently terminated or reduced from time to time pursuant to Section 2.11.
"STANDBY LOANS" shall mean the revolving loans made by the Lenders to
the Borrower pursuant to Section 2.04. Each Standby Loan shall be a Eurodollar
Standby Loan, a CD Loan or an ABR Loan.
"STATUTORY RESERVES" shall mean a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental reserves) expressed as
<PAGE> 19
15
a decimal established by the Board and any other banking authority to which the
Lender serving as Administrative Agent is subject for new negotiable
nonpersonal time deposits in dollars of over $100,000 with maturities
approximately equal to the applicable Interest Period, in the case of the
Adjusted CD Rate. Statutory Reserves shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"SUBSIDIARY" shall mean, for any person (the "Parent"), any
corporation, partnership or other entity of which securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) are at the time directly
or indirectly owned or controlled by the Parent or one or more of its
Subsidiaries or by the Parent and one or more of its Subsidiaries; PROVIDED,
HOWEVER, that (a) no person of which the Borrower or any of its Subsidiaries
acquires or has acquired control in connection with or as a consequence of any
debt or equity financing provided to such person in the ordinary course of the
business of WFSI, any of its Subsidiaries, Financial Services or WCI shall be
deemed a Subsidiary of the Borrower, (b) for purposes of paragraph (d) of
Article VI, no person which is a FSC shall be deemed a Subsidiary of the
Borrower and (c) Micros Systems, Inc. shall not be deemed a Subsidiary of the
Borrower as long as it has a class of equity securities registered under
Section 12 of the Securities Exchange Act of 1934, as amended.
"SWINGLINE BORROWING" shall mean a group of Swingline Loans made by
the Swingline Lenders on a single date.
"SWINGLINE COMMITMENT" shall mean, with respect to any Lender, the
commitment (if any) of such Lender to make Swingline Loans pursuant to Section
2.22, as set forth on Schedule 2.01 or designated by the Borrower in an
agreement between the Borrower and any such Lender, as such Lender's Swingline
Commitment may be permanently terminated or reduced from time to time pursuant
to Section 2.22(d).
"SWINGLINE EXPOSURES" shall mean at any time the aggregate principal
amount at such time of the outstanding Swingline Loans. The Swingline Exposure
of any Lender at any time shall mean its Applicable Percentage of the aggregate
Swingline Exposures at such time.
"SWINGLINE LENDER" shall mean a Lender with a Swingline Commitment.
"SWINGLINE LOAN" shall mean any loan made by a Swingline Lender
pursuant to its Swingline Commitment. Each Swingline Loan shall be an ABR Loan.
"SWINGLINE PERCENTAGE" of any Swingline Lender at any time shall mean
the percentage of the aggregate Swingline Commitments represented by such
Swingline Lender's Swingline Commitment.
"TOTAL COMMITMENT" shall mean at any time the aggregate amount of the
Lenders' Standby Commitments, as in effect at such time.
"TYPE", when used in respect of any Loan or Borrowing, shall refer to
the Rate by reference to which interest on such Loan or on the Loans comprising
such Borrowing is determined. For purposes hereof, "RATE" shall mean the LIBO
Rate, the Adjusted CD Rate, the Alternate Base Rate and the rate paid on Fixed
Rate Loans.
"U.S. PERSON" shall mean a citizen, national or resident of the United
States of America, or an entity organized in or under the laws of the United
States of America.
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"WHOLLY OWNED SUBSIDIARY" shall mean any Subsidiary of which all
securities or other ownership interests referred to in the definition of
"SUBSIDIARY" (other than, in the case of a corporation, directors' qualifying
shares) are owned directly or indirectly by the Parent (as defined in such
definition).
"WCI" shall mean WCI Communities, Inc., a Delaware corporation, and
its Wholly Owned Subsidiaries.
"WFSI" shall mean Westinghouse Financial Services, Inc., a Delaware
corporation that was merged into the Borrower on May 5, 1993.
SECTION 1.02. TERMS GENERALLY. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "INCLUDE", "INCLUDES" and
"INCLUDING" shall, except where the context otherwise requires, be deemed to be
followed by the phrase "WITHOUT LIMITATION". All references herein to Articles,
Sections, Exhibits and Schedules shall be deemed references to Articles and
Sections of, and Exhibits and Schedules to, this Agreement unless the context
shall otherwise require. Except as otherwise expressly provided herein, all
terms of an accounting nature shall be construed in accordance with GAAP as in
effect from time to time; PROVIDED, HOWEVER, that, for purposes of determining
compliance with the covenants set forth in Sections 5.07, 5.08 and 5.09 (such
Sections being referred to as the "FINANCIAL COVENANTS"), (i) except as
otherwise set forth in subsection (ii) below or in the Financial Covenants and
the definitions related thereto, such terms shall be construed in accordance
with GAAP as in effect on December 31, 1993, applied on a basis consistent with
the application used in preparing the Borrower's audited financial statements
prepared as of such date and (ii) indebtedness shall include obligations and
liabilities applicable to the Discontinued Operations but shall exclude any
obligation or liability which is specifically excluded from the definition of
"INDEBTEDNESS".
ARTICLE II. THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make Standby Loans to the Borrower, at
any time and from time to time on and after the Closing Date and until the
earlier of the Maturity Date and the termination of the Standby Commitment of
such Lender, in an aggregate principal amount at any time outstanding not to
exceed such Lender's Standby Commitment minus the sum of (a) the amount by
which the Competitive Loans outstanding at such time shall be deemed to have
used such Standby Commitment pursuant to Section 2.16, (b) such Lender's LC
Exposure at such time and (c) such Lender's Swingline Exposure at such time,
subject, however, to the conditions that (x) at no time shall the sum of (i)
the outstanding aggregate principal amount of all Standby Loans, (ii) the
outstanding aggregate principal amount of all Competitive Loans, (iii) the
outstanding aggregate principal amount of all Swingline Loans and (iv) the
Aggregate LC Exposure exceed the Total Commitment and (y) at all times the
outstanding aggregate principal amount of all Standby Loans made by each Lender
shall equal such Lender's Applicable Percentage of the outstanding aggregate
principal amount of all Standby Loans made pursuant to Section 2.04.
Within the foregoing limits, the Borrower may borrow, pay or prepay
and reborrow Standby Loans hereunder, on and after the date hereof and prior to
the Maturity Date, subject to the terms, conditions and limitations set forth
herein.
SECTION 2.02. LOANS. (a) Each Standby Loan shall be made as part of a
Borrowing consisting of Loans made by the Lenders to the Borrower ratably in
accordance with their Standby Commitments; PROVIDED, HOWEVER, that the failure
of any Lender to make any Standby Loan shall not in itself relieve any
<PAGE> 21
17
other Lender of its obligation to lend hereunder (it being understood, however,
that no Lender shall be responsible for the failure of any other Lender to make
any Loan required to be made by such other Lender). Each Competitive Loan shall
be made in accordance with the procedures set forth in Section 2.03. The
Standby Loans or Competitive Loans comprising any Borrowing shall be (i) in the
case of Competitive Loans, in an aggregate principal amount which is an
integral multiple of $1,000,000 and not less than $5,000,000 and (ii) in the
case of Standby Loans, in an aggregate principal amount which is an integral
multiple of $5,000,000 and not less than (A) $50,000,000 in the case of
Eurodollar Loans or CD Loans and (B) $25,000,000 in the case of ABR Loans (or
an aggregate principal amount equal to the remaining balance of the available
Standby Commitments).
(b) Each Competitive Borrowing shall be comprised entirely of one or
more Eurodollar Competitive Loans or Fixed Rate Loans, and each Standby
Borrowing shall be comprised entirely of Eurodollar Standby Loans, CD Loans or
ABR Loans, as the Borrower may request pursuant to Section 2.03 or 2.04, as
applicable. Each Lender may at its option make any Eurodollar Loan by causing
any domestic or foreign branch or Affiliate of such Lender to make such Loan;
PROVIDED that any exercise of such option shall not affect the obligation of
the Borrower to repay such Loan in accordance with the terms of this Agreement.
Borrowings of more than one Type may be outstanding at the same time; PROVIDED,
HOWEVER, that the Borrower shall not be entitled to request any Borrowing
which, if made, would result in an aggregate of more than 25 separate Standby
Loans of any Lender being outstanding hereunder at any one time. For purposes
of the foregoing, Loans having different Interest Periods, regardless of
whether they commence on the same date, shall be considered separate Loans.
(c) Subject to Section 2.05, each Lender shall make each Loan (other
than a Swingline Loan, as to which this Section 2.02 shall not apply) to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds to the Administrative Agent in New York, New York,
not later than 12:00 noon, New York City time (or, in connection with an ABR
Borrowing to be made on the same day on which a notice is submitted, 12:30
p.m.) and the Administrative Agent shall by 3:00 p.m., New York City time,
credit the amounts so received to the general deposit account of the Borrower
with the Administrative Agent or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met,
return the amounts so received to the respective Lenders by wire transfer of
immediately available funds. Competitive Loans shall be made by the Lender or
Lenders whose Competitive Bids therefor are accepted pursuant to Section 2.03
in the amounts so accepted and Standby Loans shall be made by the Lenders pro
rata in accordance with Section 2.16. Unless the Administrative Agent shall
have received notice from a Lender prior to the proposed date of any Borrowing
that such Lender will not make available to the Administrative Agent such
Lender's portion of such Borrowing, the Administrative Agent may assume that
such Lender has made such portion available to the Administrative Agent on the
date of such Borrowing in accordance with this paragraph (c) and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that
such Lender shall not have made such portion available to the Administrative
Agent, such Lender and the Borrower severally agree to repay to the
Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower until the date such amount is repaid to the Administrative
Agent at (i) in the case of the Borrower, the interest rate applicable at the
time to the Loans comprising such Borrowing and (ii) in the case of such
Lender, the Federal Funds Effective Rate. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount shall constitute
such Lender's Loan as part of such Borrowing for purposes of this Agreement;
PROVIDED that such repayment shall not release such Lender from any liability
it may have to the Borrower for the failure to make such Loan at the time
required herein.
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(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request any Borrowing if the Interest Period
requested with respect thereto would end after the Maturity Date.
SECTION 2.03. COMPETITIVE BID PROCEDURE. (a) In order to request
Competitive Bids, the Borrower shall hand deliver or telecopy to the
Administrative Agent a duly completed Competitive Bid Request in the form of
Exhibit A-1, to be received by the Administrative Agent (i) in the case of a
Eurodollar Competitive Borrowing, not later than 10:00 a.m., New York City
time, four Business Days before a proposed Competitive Borrowing and (ii) in
the case of a Fixed Rate Borrowing, not later than 10:00 a.m., New York City
time, one Business Day before a proposed Competitive Borrowing. No CD Loan or
ABR Loan shall be requested in, or made pursuant to, a Competitive Bid Request.
A Competitive Bid Request that does not conform substantially to the format of
Exhibit A-1 may be rejected in the Administrative Agent's discretion (exercised
in good faith), and the Administrative Agent shall promptly notify the Borrower
of such rejection by telecopier. Such request shall in each case refer to this
Agreement and specify (x) whether the Borrowing then being requested is to be a
Eurodollar Borrowing or a Fixed Rate Borrowing, (y) the date of such Borrowing
(which shall be a Business Day) and the aggregate principal amount thereof
which shall be in a minimum principal amount of $25,000,000 and in an integral
multiple of $1,000,000, and (z) the Interest Period with respect thereto (which
may not end after the Maturity Date). Promptly after its receipt of a
Competitive Bid Request that is not rejected as aforesaid (and in any event by
5:00 p.m., New York City time, on the date of such receipt if such receipt
occurs by the time specified in the first sentence of this paragraph), the
Administrative Agent shall invite by telecopier (in the form set forth in
Exhibit A-2) the Lenders to bid, on the terms and conditions of this Agreement,
to make Competitive Loans pursuant to the Competitive Bid Request.
(b) Each Lender may, in its sole discretion, make one or more
Competitive Bids to the Borrower responsive to a Competitive Bid Request. Each
Competitive Bid must be received by the Administrative Agent via telecopier, in
the form of Exhibit A-3, (i) in the case of a Eurodollar Competitive Borrowing,
not later than 9:30 a.m., New York City time, three Business Days before a
proposed Competitive Borrowing and (ii) in the case of a Fixed Rate Borrowing,
not later than 9:30 a.m., New York City time, on the day of a proposed
Competitive Borrowing. Multiple Competitive Bids will be accepted by the
Administrative Agent. Competitive Bids that do not conform substantially to the
format of Exhibit A-3 may be rejected by the Administrative Agent after
conferring with, and upon the instruction of, the Borrower, and the
Administrative Agent shall notify the Lender making such nonconforming
Competitive Bid of such rejection as soon as practicable. Each Competitive Bid
shall refer to this Agreement and specify (x) the principal amount (which shall
be in a minimum principal amount of $5,000,000 and in an integral multiple of
$1,000,000 and which may equal the entire principal amount of the Competitive
Borrowing requested by the Borrower) of the Competitive Loan or Loans that the
applicable Lender is willing to make to the Borrower, (y) the Competitive Bid
Rate or Rates at which such Lender is prepared to make the Competitive Loan or
Loans and (z) the Interest Period and the last day thereof. A Competitive Bid
submitted pursuant to this paragraph (b) shall be irrevocable (subject to the
satisfaction of the conditions to borrowing set forth in Article IV).
(c) The Administrative Agent shall promptly (and in any event by 10:15
a.m., New York City time, on the date on which such Competitive Bids shall have
been made) notify the Borrower by telecopier of all the Competitive Bids made,
the Competitive Bid Rate and the principal amount of each Competitive Loan in
respect of which a Competitive Bid was made and the identity of the Lender that
made each Competitive Bid. The Administrative Agent shall send a copy of all
Competitive Bids to the Borrower for its records as soon as practicable after
completion of the bidding process set forth in this Section 2.03.
(d) The Borrower may in its sole and absolute discretion, subject only
to the provisions of this paragraph (d), accept or reject any Competitive Bid
referred to in paragraph (c) above. The Borrower shall notify the
Administrative Agent by telephone, confirmed by telecopier in the form of a
Competitive Bid
<PAGE> 23
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Accept/Reject Letter, whether and to what extent it has decided to accept or
reject any of or all the Competitive Bids referred to in paragraph (c) above,
(x) in the case of a Eurodollar Competitive Borrowing, not later than 11:00
a.m., New York City time, three Business Days before a proposed Competitive
Borrowing, and (y) in the case of a Fixed Rate Borrowing, not later than 11:00
a.m., New York City time, on the day of a proposed Competitive Borrowing;
PROVIDED, HOWEVER, that (i) the failure by the Borrower to give such notice
shall be deemed to be a rejection of all the Competitive Bids referred to in
paragraph (c) above, (ii) the Borrower shall not accept a Competitive Bid made
at a particular Competitive Bid Rate if it has decided to reject a Competitive
Bid made at a lower Competitive Bid Rate, (iii) the aggregate amount of the
Competitive Bids accepted by the Borrower shall not exceed the principal
amount specified in the Competitive Bid Request (but may be less than that
requested), (iv) if the Borrower shall accept a Competitive Bid or Competitive
Bids made at a particular Competitive Bid Rate but the amount of such
Competitive Bid or Competitive Bids shall cause the total amount of Competitive
Bids to be accepted by it to exceed the amount specified in the Competitive Bid
Request, then the Borrower shall accept a portion of such Competitive Bid or
Competitive Bids in an amount equal to the amount specified in the Competitive
Bid Request less the amount of all other Competitive Bids accepted with respect
to such Competitive Bid Request, which acceptance, in the case of multiple
Competitive Bids at such Competitive Bid Rate, shall be made pro rata in
accordance with the amount of each such Competitive Bid at such Competitive Bid
Rate, and (v) except pursuant to clause (iv) above, no Competitive Bid shall be
accepted for a Competitive Loan unless such Competitive Loan is in a minimum
principal amount of $5,000,000 and an integral multiple of $1,000,000; PROVIDED
FURTHER, HOWEVER, that if a Competitive Loan must be in an amount less than
$5,000,000 because of the provisions of clause (iv) above, such Competitive
Loan may be for a minimum of $1,000,000 or any integral multiple thereof, and
in calculating the pro rata allocation of acceptances of portions of multiple
Competitive Bids at a particular Competitive Bid Rate pursuant to clause (iv)
the amounts shall be rounded to integral multiples of $1,000,000 in a manner
which shall be in the discretion of the Borrower. A notice given by the
Borrower pursuant to this paragraph (d) shall be irrevocable.
(e) The Administrative Agent shall promptly notify each bidding Lender
whether or not its Competitive Bid has been accepted (and if so, in what amount
and at what Competitive Bid Rate) by telecopy sent by the Administrative Agent,
and each successful bidder will thereupon become bound, subject to the other
applicable conditions hereof, to make the Competitive Loan in respect of which
its Competitive Bid has been accepted.
(f) A Competitive Bid Request shall not be made within five Business
Days after the date of any previous Competitive Bid Request, unless the
Borrower and the Administrative Agent shall mutually agree otherwise.
(g) If the Administrative Agent shall elect to submit a Competitive
Bid in its capacity as a Lender, it shall submit such Competitive Bid directly
to the Borrower one quarter of an hour earlier than the latest time at which
the other Lenders are required to submit their Competitive Bids to the
Administrative Agent pursuant to paragraph (b) above.
(h) All notices required by this Section 2.03 shall be given in
accordance with Section 8.01.
SECTION 2.04. STANDBY BORROWING PROCEDURE. In order to request a
Standby Borrowing, the Borrower shall hand deliver or telecopy to the
Administrative Agent a Standby Borrowing Request in the form of Exhibit A-5 (a)
in the case of a Eurodollar Standby Borrowing, not later than 10:30 a.m., New
York City time, three Business Days before a proposed borrowing, (b) in the
case of a CD Borrowing, not later than 10:30 a.m., New York City time, one
Business Day before a proposed borrowing and (c) in the case of an ABR
Borrowing, not later than 10:30 a.m., New York City time, on the day of a
proposed borrowing. No Fixed Rate Loan shall be requested or made pursuant to a
Standby Borrowing Request. Such notice shall be irrevocable and shall in each
case specify (i) whether the Borrowing then being
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requested is to be a Eurodollar Standby Borrowing, a CD Borrowing or an
ABR Borrowing; (ii) the date of such Standby Borrowing (which shall be a
Business Day) and the amount thereof; and (iii) if such Borrowing is to
be a Eurodollar Standby Borrowing or CD Borrowing, the Interest Period
with respect thereto. If no election as to the Type of Standby Borrowing
is specified in any such notice, then the requested Standby Borrowing
shall be an ABR Borrowing. If no Interest Period with respect to any Eurodollar
Standby Borrowing or CD Borrowing is specified in any such notice, then the
Borrower shall be deemed to have selected an Interest Period of one month's
duration, in the case of a Eurodollar Standby Borrowing, or 30 days' duration,
in the case of a CD Borrowing. If the Borrower shall not have given notice in
accordance with this Section 2.04 of its election to refinance a Standby
Borrowing prior to the end of the Interest Period in effect for such Borrowing,
then the Borrower shall (unless such Borrowing is repaid at the end of such
Interest Period) be deemed to have given notice of an election to refinance
such Borrowing with an ABR Borrowing. The Administrative Agent shall promptly
advise the Lenders of any notice given pursuant to this Section 2.04 and of
each Lender's portion of the requested Borrowing.
SECTION 2.05. REFINANCINGS. The Borrower may refinance all or any part
of any Borrowing (whether a Competitive Borrowing, Standby Borrowing or
Swingline Borrowing) with a Borrowing of the same or a different Type made
pursuant to Section 2.03, Section 2.04 or Section 2.22, subject to the
conditions and limitations set forth herein and elsewhere in this Agreement.
Any Borrowing or part thereof so refinanced shall be deemed to be repaid in
accordance with Section 2.07, 2.12 or 2.22 with the proceeds of a new Borrowing
hereunder and the proceeds of the new Borrowing, to the extent they do not
exceed the principal amount of the Borrowing being refinanced, shall not be
paid by the Lenders to the Administrative Agent or by the Administrative Agent
to the Borrower pursuant to Section 2.02(c); PROVIDED, HOWEVER, that (i) if the
principal amount extended by a Lender in a refinancing is greater than the
principal amount extended by such Lender in the Borrowing being refinanced,
then such Lender shall pay such difference to the Administrative Agent for
distribution to the Lenders described in (ii) below, (ii) if the principal
amount extended by a Lender in the Borrowing being refinanced is greater than
the principal amount being extended by such Lender in the refinancing, the
Administrative Agent shall return the difference to such Lender out of amounts
received pursuant to (i) above, and (iii) to the extent any Lender fails to pay
the Administrative Agent amounts due from it pursuant to (i) above, any Loan or
portion thereof being refinanced with such amounts shall not be deemed repaid
in accordance with Section 2.07 and shall be payable by the Borrower (but the
Borrower shall not be deemed to be in default in respect of its obligation to
make such payment until one Business Day after the Administrative Agent shall
have notified it of the failure of such Lender to make such payment).
SECTION 2.06. FEES. (a) The Borrower agrees to pay to each Lender,
through the Administrative Agent, on each March 31, June 30, September 30 and
December 31 and on the Maturity Date or the date on which the Standby
Commitment of such Lender shall be terminated as provided herein, a facility
fee (a "FACILITY FEE") at a rate per annum equal to the Applicable Facility Fee
Percentage from time to time in effect on the amount of the Standby Commitment
of such Lender from time to time in effect, whether used or unused, during the
preceding quarter (or shorter period commencing with the Closing Date, or
ending with the Maturity Date or any date on which the Standby Commitment of
such Lender shall be terminated). All Facility Fees shall be computed on the
basis of the actual number of days elapsed in a year of 360 days. The Facility
Fee due to each Lender shall commence to accrue on the Closing Date and shall
cease to accrue on the earlier of the Maturity Date and the termination of the
Standby Commitment of such Lender as provided herein.
(b) The Borrower agrees to pay to each Lender, through the
Administrative Agent, on each March 31, June 30, September 30 and December 31,
and on the Maturity Date or the date on which the Standby Commitment of such
Lender shall be terminated as provided herein and all Letters of Credit issued
hereunder shall have expired, a letter of credit fee (an "LC FEE") equal to the
Applicable Margin from time to time in effect for Eurodollar Standby Loans on
such Lender's Applicable Percentage of the average daily
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undrawn amount of the Letters of Credit outstanding during the preceding
quarter (or shorter period commencing with the Closing Date or ending with the
Maturity Date or the date on which the Standby Commitment of such Lender shall
have been terminated and all Letters of Credit issued hereunder shall have
expired). All LC Fees shall be computed on the basis of the actual number of
days elapsed in a year of 360 days.
(c) The Borrower agrees to pay to the Agents, through the
Administrative Agent, for their own accounts, the fees ("AGENT FEES") provided
for in the Fee Letters at the times provided therein.
(d) The Borrower agrees to pay to each Issuing Bank, through the
Administrative Agent, for its own account, the applicable Issuing Bank Fees.
(e) All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders or to the Issuing Banks. Once paid, none of the Fees shall be
refundable under any circumstances (other than corrections of errors in
payment).
SECTION 2.07. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The
outstanding principal balance of each Loan shall be payable on the last day of
the Interest Period applicable thereto and on the Maturity Date. Each Loan
shall bear interest from and including the date thereof on the outstanding
principal balance thereof as set forth in Section 2.08.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness to such Lender resulting
from each Loan from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time under this
Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type of each Loan and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs
(b) and (c) of this Section 2.07 shall, to the extent permitted by applicable
law, be PRIMA FACIE evidence of the existence and amounts of the obligations
therein recorded; PROVIDED, HOWEVER, that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not
in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
SECTION 2.08. INTEREST ON LOANS. (a) Subject to the provisions of
Section 2.09, the Loans comprising each Eurodollar Borrowing shall bear
interest (computed on the basis of the actual number of days elapsed over a
year of 360 days) at a rate per annum equal to (i) in the case of each
Eurodollar Standby Loan, the LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin and (ii) in the case of each
Eurodollar Competitive Loan, the LIBO Rate for the Interest Period in effect
for such Borrowing plus the Margin offered by the Lender making such Loan and
accepted by the Borrower pursuant to Section 2.03. Interest on each Eurodollar
Borrowing shall be payable on each applicable Interest Payment Date. The LIBO
Rate for each Interest Period shall be determined by the Administrative Agent,
and such determination shall be conclusive absent manifest error. The
Administrative Agent shall promptly advise the Borrower and each Lender, as
appropriate, of such determination.
(b) Subject to the provisions of Section 2.09, the Loans comprising
each CD Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to
the Adjusted CD Rate for the Interest Period in effect for such Borrowing plus
the
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Applicable Margin. Interest on each CD Borrowing shall be payable on each
applicable Interest Payment Date. The Adjusted CD Rate for each Interest
Period shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error. The Administrative Agent shall
promptly advise the Borrower and each Lender, as appropriate, of such
determination.
(c) Subject to the provisions of Section 2.09, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 365 or 366 days, as the case may be, when
determined by reference to the Prime Rate and over a year of 360 days at all
other times) at a rate per annum equal to the Alternate Base Rate. Interest on
each ABR Borrowing shall be payable on each applicable Interest Payment Date.
The Alternate Base Rate shall be determined by the Administrative Agent, and
such determination shall be conclusive absent manifest error.
(d) Subject to the provisions of Section 2.09, each Fixed Rate Loan
shall bear interest at a rate per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days) equal to the fixed rate of
interest offered by the Lender making such Loan and accepted by the Borrower
pursuant to Section 2.03. Interest on each Fixed Rate Loan shall be payable on
each applicable Interest Payment Date.
SECTION 2.09. DEFAULT INTEREST. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount
becoming due hereunder, whether by scheduled maturity, notice of prepayment,
acceleration or otherwise, the Borrower shall on demand from time to time from
the Administrative Agent pay interest, to the extent permitted by law, on such
defaulted amount up to (but not including) the date of actual payment (after as
well as before judgment) at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days, as the case may
be, when determined by reference to the Prime Rate and over a year of 360 days
at all other times) equal to the Alternate Base Rate plus, at all times after
the Administrative Agent shall have notified the Borrower that default interest
will be charged, 2%.
SECTION 2.10. ALTERNATE RATE OF INTEREST. (a) In the event, and on
each occasion, that on the day two Business Days prior to the commencement of
any Interest Period for a Eurodollar Borrowing (i) the Administrative Agent
shall have determined, based upon communications with the Reference Banks, that
dollar deposits in the principal amounts of the Eurodollar Loans comprising
such Borrowing are not generally available in the London interbank market, or
that reasonable means do not exist for ascertaining the LIBO Rate, or (ii) the
Required Lenders shall have determined and shall have notified the
Administrative Agent that the rates at which such dollar deposits are being
offered by the Reference Banks will not adequately and fairly reflect the cost
to such Lenders of making or maintaining Eurodollar Loans during such Interest
Period, the Administrative Agent shall, as soon as practicable thereafter, give
written or telecopy notice of such determination to the Borrower and the
Lenders. In the event of any such determination, until the Administrative Agent
shall have advised the Borrower and the Lenders that the circumstances giving
rise to such notice no longer exist, (i) any request by the Borrower for a
Eurodollar Competitive Borrowing pursuant to Section 2.03 to be made after such
determination shall be of no force and effect and shall be denied by the
Administrative Agent and (ii) any request by the Borrower for a Eurodollar
Standby Borrowing pursuant to Section 2.04 to be made after such determination
shall be deemed to be a request for an ABR Borrowing. Also, in the event of any
such determination, the Borrower shall be entitled, in its sole discretion, if
the requested Borrowing has not been made, to cancel its acceptance of the
Competitive Bids or to cancel its Standby Borrowing Request relating thereto,
subject to Section 2.15. Each determination by the Administrative Agent or the
Required Lenders hereunder shall be conclusive absent manifest error.
(b) In the event, and on each occasion, that on or before the day on
which the Adjusted CD Rate for an Interest Period in respect of a CD Borrowing
is to be determined (i) the Administrative Agent shall have determined, based
upon communications with the Reference Banks, that such Adjusted CD Rate
<PAGE> 27
23
cannot be determined for any reason, including the inability of the
Administrative Agent to obtain sufficient bids in accordance with the terms of
the definition of Fixed CD Rate, or (ii) the Required Lenders shall have
determined and shall have notified the Administrative Agent that the Adjusted
CD Rate for such CD Borrowing will not adequately and fairly reflect the cost
to such Lenders of making or maintaining CD Loans during such Interest Period,
the Administrative Agent shall, as soon as practicable thereafter, give written
or telecopy notice of such determination to the Borrower and the Lenders. In
the event of any such determination, any request by the Borrower for a CD
Borrowing pursuant to Section 2.04 to be made after such determination shall,
until the Administrative Agent shall have advised the Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, be deemed
to be a request for an ABR Borrowing. Also, in the event of any such
determination, the Borrower shall be entitled, in its sole discretion, if the
requested Borrowing has not been made, to cancel its Standby Borrowing Request
relating thereto, subject to Section 2.15. Each determination by the
Administrative Agent or the Required Lenders hereunder shall be conclusive
absent manifest error.
SECTION 2.11. TERMINATION AND REDUCTION OF COMMITMENTS. (a) The
Commitments shall be automatically terminated on the Maturity Date.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Standby Commitments; PROVIDED, HOWEVER, that (i) each partial reduction of
the Standby Commitments shall be in an integral multiple of $50,000,000 and in
a minimum principal amount of $100,000,000 and (ii) no such termination or
reduction shall be made which would reduce the Standby Commitments to an amount
less than the sum of (A) the aggregate outstanding principal amount of the
Competitive Loans and (B) the Aggregate LC Exposure. The Administrative Agent
shall promptly advise the Lenders of any notice given pursuant to this Section
2.11(b).
(c) Except as otherwise provided in Section 2.21, each reduction in
the Standby Commitments hereunder shall be made ratably among the Lenders in
accordance with their respective Standby Commitments. The Borrower agrees to
pay to the Administrative Agent for the account of the Lenders, on the date of
termination of the Standby Commitments, the Facility Fees on the amount of the
Standby Commitments so terminated accrued through the date of such termination.
SECTION 2.12. PREPAYMENT. (a) The Borrower shall have the right at any
time and from time to time to prepay any Standby Borrowing, in whole or in
part, upon giving written or telecopy notice (or telephone notice promptly
confirmed by written or telecopy notice) to the Administrative Agent: (i)
before 10:00 a.m., New York City time, three Business Days prior to prepayment,
in the case of Eurodollar Loans, (ii) before 10:00 a.m., New York City time,
two Business Days prior to prepayment, in the case of CD Loans, and (iii)
before 10:00 a.m., New York City time, one Business Day prior to prepayment, in
the case of ABR Loans; PROVIDED, HOWEVER, that each partial prepayment shall be
in an amount which is an integral multiple of $1,000,000 and not less than
$5,000,000. The Administrative Agent shall promptly advise the Lenders of any
notice given pursuant to this Section 2.12(a). The Borrower shall not have
the right to prepay any Competitive Borrowing without the consent of the
affected Lender or Lenders.
(b) On the date of any termination or reduction of the Standby
Commitments pursuant to Section 2.11 or Section 2.21, the Borrower shall pay or
prepay as much of the Standby Borrowings and Swingline Loans as shall be
necessary in order that the sum of the aggregate principal amount of the
Competitive Loans, Swingline Loans and Standby Loans outstanding and the
Aggregate LC Exposure will not exceed the Total Commitment after giving effect
to such termination or reduction.
(c) Each notice of prepayment shall specify the prepayment date and
the principal amount of each Borrowing (or portion thereof) to be prepaid,
shall be irrevocable and shall commit the Borrower to prepay
<PAGE> 28
24
such Borrowing (or portion thereof) by the amount stated therein on the
date stated therein. All prepayments under this Section 2.12 shall be
subject to Section 2.15 but otherwise without premium or penalty. All
prepayments under this Section 2.12 shall be accompanied by accrued
interest on the principal amount being prepaid to the date of payment.
SECTION 2.13. RESERVE REQUIREMENTS; CHANGE IN CIRCUMSTANCES. (a)
Notwithstanding any other provision herein, if after the date of this Agreement
any change in applicable law or regulation (including any change in the reserve
percentages provided for in Regulation D) or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof shall change the basis of taxation of
payments to any Lender of the principal of or interest on any Eurodollar Loan,
CD Loan or Fixed Rate Loan made by such Lender (other than changes in respect
of taxes imposed on the overall net income of such Lender by the jurisdiction
in which such Lender has its principal office (or in which it holds any
Eurodollar Loan, CD Loan or Fixed Rate Loan) or by any political subdivision
or taxing authority therein and other than taxes that would not have been
imposed but for the failure of such Lender to comply with applicable
certification, information, documentation or other reporting requirements),
or shall impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of or deposits with or for the account of
such Lender (except any such reserve requirement which is reflected in the
Adjusted CD Rate), or shall impose on such Lender or the London interbank market
any other condition affecting this Agreement or any Eurodollar Loan, CD
Loan or Fixed Rate Loan made by such Lender, and the result of any of the
foregoing shall be to increase the cost to such Lender of making or maintaining
any Eurodollar Loan, CD Loan or Fixed Rate Loan or to reduce the amount of any
sum received or receivable by such Lender hereunder (whether of principal,
interest or otherwise) in respect of any Eurodollar Loan, CD Loan or Fixed Rate
Loan by an amount deemed by such Lender to be material, then the Borrower
agrees to pay to such Lender as provided in paragraph (c) below such additional
amount or amounts as will compensate such Lender for such additional costs
incurred or reduction suffered. Notwithstanding the foregoing, no Lender shall
be entitled to request compensation under this paragraph with respect to any
Competitive Loan if the change giving rise to such request shall, or in good
faith should, have been taken into account in formulating the Competitive
Bid pursuant to which such Competitive Loan shall have been made.
(b) If any Lender or any Issuing Bank shall have determined that the
adoption after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any law, rule, regulation or
guideline regarding capital adequacy or in the interpretation or administration
of any of the foregoing by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender (or any lending office of such Lender) or Issuing Bank
or any Lender's or Issuing Bank's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's or Issuing Bank's capital or on
the capital of such Lender's or Issuing Bank's holding company, if any, as a
consequence of this Agreement or the Loans made by such Lender or the LC
Exposure of such Lender or Letters of Credit issued by such Issuing Bank
pursuant hereto to a level below that which such Lender or Issuing Bank or such
Lender's or Issuing Bank's holding company could have achieved but for such
applicability, adoption, change or compliance (taking into consideration such
Lender's or Issuing Bank's policies and the policies of such Lender's or
Issuing Bank's holding company with respect to capital adequacy) by an amount
deemed by such Lender or Issuing Bank to be material, then from time to time
the Borrower agrees to pay to such Lender or Issuing Bank as provided in
paragraph (c) below such additional amount or amounts as will compensate such
Lender or Issuing Bank or such Lender's or Issuing Bank's holding company for
any such reduction suffered.
(c) A certificate of each Lender or Issuing Bank setting forth such
amount or amounts as shall be necessary to compensate such Lender or Issuing
Bank as specified in paragraph (a) or (b) above, as the case may be, and the
basis therefor in reasonable detail shall be delivered to the Borrower and
shall be
<PAGE> 29
25
conclusive absent manifest error. The Borrower shall pay each Lender
or Issuing Bank the amount shown as due on any such certificate within 30 days
after its receipt of the same. Upon the receipt of any such certificate, the
Borrower shall be entitled, in its sole discretion, if any requested Loan has
not been made, to cancel its acceptance of the relevant Competitive Bids or to
cancel the Standby Borrowing Request relating thereto, subject to Section 2.15.
(d) Except as provided in this paragraph, failure on the part of any
Lender to demand compensation for any increased costs or reduction in amounts
received or receivable or reduction in return on capital with respect to any
period shall not constitute a waiver of such Lender's right to demand
compensation with respect to any other period. The protection of this Section
shall be available to each Lender regardless of any possible contention of
the invalidity or inapplicability of the law, rule, regulation, guideline or
other change or condition which shall have occurred or been imposed so long
as it shall be customary for Lenders affected thereby to comply therewith.
No Lender shall be entitled to compensation under this Section 2.13 for any
costs incurred or reductions suffered with respect to any date unless it shall
have notified the Borrower that it will demand compensation for such costs or
reductions under paragraph (c) above not more than 90 days after the later of
(i) such date and (ii) the date on which it shall have become aware of such
costs or reductions. Notwithstanding any other provision of this Section 2.13,
no Lender shall demand compensation for any increased cost or reduction
referred to above if it shall not at the time be the general policy or
practice of such Lender to demand such compensation in similar circumstances
under comparable provisions of other credit agreements, if any. In the event
the Borrower shall reimburse any Lender pursuant to this Section 2.13 for any
cost and such Lender shall subsequently receive a refund in respect thereof,
such Lender shall so notify the Borrower and, upon its request, will pay to
the Borrower the portion of such refund which such Lender shall determine in
good faith to be allocable to the cost so reimbursed.
SECTION 2.14. CHANGE IN LEGALITY. (a) Notwithstanding any other
provision herein, if any change in any law or regulation or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurodollar Loan, then, by written
notice to the Borrower and to the Administrative Agent, such Lender may:
(i) declare that Eurodollar Standby Loans will not thereafter
be made by such Lender hereunder, whereupon such Lender shall not
submit a Competitive Bid in response to a request for Eurodollar
Competitive Loans and any request by the Borrower for a Eurodollar
Standby Borrowing shall, as to such Lender only, be deemed a request
for an ABR Loan unless such declaration shall be subsequently
withdrawn; PROVIDED, HOWEVER, the Borrower shall be entitled, in its
sole discretion, if the requested Borrowing has not been made, to
cancel its acceptance of the relevant Competitive Bids or to cancel
its Standby Borrowing Request relating thereto, subject to Section
2.15; and
(ii) require that all outstanding Eurodollar Standby Loans
made by it be converted to ABR Loans, in which event all such
Eurodollar Standby Loans shall be automatically converted to ABR Loans
as of the effective date of such notice as provided in paragraph (b)
below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal which would otherwise have been applied
to repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
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(b) For purposes of this Section 2.14, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan, if lawful, on the last
day of the Interest Period currently applicable to such Eurodollar Loan; in all
other cases such notice shall be effective on the date of receipt by the
Borrower.
SECTION 2.15. INDEMNITY. The Borrower agrees to indemnify each Lender
against any loss or expense described below which such Lender may sustain or
incur as a consequence of (a) any failure by the Borrower to fulfill on the
date of any borrowing hereunder the applicable conditions set forth in Article
IV, (b) any failure by the Borrower to borrow any Loan hereunder after
irrevocable notice of such borrowing has been given or deemed given or
Competitive Bids have been accepted pursuant to this Article II or (c) any
payment, prepayment or conversion of a Eurodollar Loan, CD Loan or Fixed Rate
Loan required by any other provision of this Agreement or otherwise made or
deemed made, whatever the circumstances may be that give rise to such payment,
prepayment or conversion, or any transfer of any such Loan pursuant to
Section 2.21 or 9.16(b), on a date other than the last day of the Interest
Period applicable thereto. The loss or expense for which such Lender shall be
indemnified under this Section 2.15 shall be equal to the excess, if any,
as reasonably determined by such Lender, of (i) its cost of obtaining the
funds for the Loan being paid, prepaid, converted or not borrowed (assumed
to be the LIBO Rate or Adjusted CD Rate or, in the case of a Fixed Rate Loan,
the fixed rate of interest applicable thereto) for the period from the date of
such payment, prepayment, conversion or failure to borrow to the last day of
the Interest Period for such Loan (or, in the case of a failure to borrow,
the Interest Period for such Loan which would have commenced on the date
of such failure) over (ii) the amount of interest (as reasonably determined
by such Lender) that would be realized by such Lender in reemploying the
funds so paid, prepaid, converted or not borrowed for such period or Interest
Period, as the case may be; PROVIDED, HOWEVER, that such amount shall not
include any loss of a Lender's margin or spread over its cost of obtaining
funds as described above. A certificate of any Lender setting forth any amount
or amounts which such Lender is entitled to receive pursuant to this Section
shall be delivered to the Borrower and shall be conclusive absent manifest
error. This covenant shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
SECTION 2.16. PRO RATA TREATMENT. Except as required under Section
2.14 or 2.21, each Standby Borrowing, each payment or prepayment of principal
of any Standby Borrowing, each payment of interest on the Standby Loans, each
payment of the Facility Fees and LC Fees, each reduction of the Standby
Commitments and each refinancing of any Borrowing with a Standby Borrowing of
any Type, shall be allocated pro rata among the Lenders in accordance with
their respective Standby Commitments (or, if such Commitments shall have
expired or been terminated, in accordance with the respective principal amounts
of their outstanding Standby Loans). Each payment of principal of any
Competitive Borrowing shall be allocated pro rata among the Lenders
participating in such Borrowing in accordance with the respective principal
amounts of their outstanding Competitive Loans comprising such Borrowing. Each
payment of interest on any Competitive Borrowing shall be allocated pro rata
among the Lenders participating in such Borrowing in accordance with the
respective amounts of accrued and unpaid interest on their outstanding
Competitive Loans comprising such Borrowing. For purposes of determining the
available Commitments of the Lenders and the Total Commitment at any time, each
outstanding Competitive Borrowing shall be deemed to have utilized the Standby
Commitments of the Lenders (including those Lenders which shall not have made
Loans as part of such Competitive Borrowing) pro rata in accordance with such
respective Commitments and to have utilized the Total Commitment by the amount
of such Competitive Borrowing. Each Lender agrees that in computing such
Lender's portion of any Borrowing to be made hereunder, the Administrative
Agent may, in its discretion, round such Lender's percentage of such Borrowing
to the next higher or lower whole dollar amount.
SECTION 2.17. SHARING OF SETOFFS. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrower, or pursuant to a secured claim under Section 506 of Title
11 of the United States Code or other security or interest arising from, or in
lieu of,
<PAGE> 31
27
such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means
(other than pursuant to any provision of this Agreement), obtain payment
(voluntary or involuntary) in respect of any Standby Loan or Loans or such
Lender's Applicable Percentage of any LC Disbursement as a result of which the
unpaid principal portion of the Standby Loans and unpaid portion of such
Lender's Applicable Percentage of the LC Disbursements shall be proportionately
less than the unpaid principal portion of the Standby Loans and unpaid portion
of the Applicable Percentage of the LC Disbursements of any other Lender, it
shall be deemed simultaneously to have purchased from such other Lender at face
value, and shall promptly pay to such other Lender the purchase price for, a
participation in the Standby Loans and Applicable Percentage of the LC
Disbursements of such other Lender, so that the aggregate unpaid principal
amount of the Standby Loans and participations in the Standby Loans held by
each Lender and Applicable Percentage of LC Disbursements and participations in
LC Disbursements held by such Lender shall be in the same proportion to the
aggregate unpaid principal amount of all Standby Loans and LC Disbursements
then outstanding as the principal amount of its Standby Loans and its
Applicable Percentage of LC Disbursements prior to such exercise of
banker's lien, setoff or counterclaim or other event was to the principal
amount of all Standby Loans and LC Disbursements outstanding prior to such
exercise of banker's lien, setoff or counterclaim or other event;
PROVIDED, HOWEVER, that, if any such purchase or purchases or
adjustments shall be made pursuant to this Section 2.17 and the payment giving
rise thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustment restored without interest. The Borrower expressly
consents to the foregoing arrangements and agrees that any Lender holding a
participation in a Standby Loan or LC Disbursement deemed to have been so
purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made a Standby Loan
directly to the Borrower or participation in a Letter of Credit in the amount
of such participation.
SECTION 2.18. PAYMENTS. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder and under any other Loan Document not later than 12:00
(noon), New York City time, on the date when due in dollars to the
Administrative Agent at its offices at 270 Park Avenue, New York, New York, in
immediately available funds.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.19. LETTERS OF CREDIT. (a) Subject to the terms and
conditions and relying upon the representations and warranties herein set
forth, each Issuing Bank agrees, at any time and from time to time on or after
the Closing Date until the earlier of the tenth Business Day preceding the
Maturity Date and the termination of the Commitments in accordance with the
terms hereof, to issue and deliver or to extend the expiry of Letters of Credit
for the account of the Borrower in an aggregate outstanding undrawn amount
which does not exceed the maximum amount specified in the applicable Issuing
Bank Agreement and which, together with the aggregate outstanding undrawn
amount of Letters of Credit to be issued by other Issuing Banks on such date,
does not exceed the lesser of (i) the Total Commitment minus the aggregate
principal amount of the outstanding Loans and the Aggregate LC Exposure
immediately prior to such issuance or extension (excluding the undrawn amount
of any such Letter of Credit the expiry of which is being extended pursuant to
this Section 2.19(a)) and (ii) $1,000,000,000 minus the aggregate LC Exposure
immediately prior to such issuance or extension (excluding the undrawn amount
of any such Letter of Credit the expiry of which is being extended pursuant to
this Section 2.19(a)). Each Letter of Credit (i) shall be in a form approved in
writing by the Borrower, the Administrative Agent and the applicable Issuing
Bank, (ii) shall be in a minimum principal amount of $2,500,000 and (iii) shall
permit drawings upon the presentation of such documents as shall be specified
by the Borrower in the applicable notice
<PAGE> 32
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delivered pursuant to paragraph (c) below. The Borrower, the Issuing Banks
and the Lenders agree that the Existing Letters of Credit shall be deemed
issued hereunder on the Closing Date and no longer outstanding under the
Existing Credit Agreement.
(b) Each Letter of Credit shall by its terms expire not later than the
earlier of (i) the first anniversary of the date of issuance or extension
(subject to extension for additional one-year (or shorter) periods by the
applicable Issuing Bank as contemplated by paragraph (a) above) and (ii) the
fifth Business Day preceding the Maturity Date. Each Letter of Credit shall by
its terms provide for payment of drawings in dollars.
(c) The Borrower shall give the applicable Issuing Bank written or
telecopy notice not later than 10:00 a.m., New York City time, five Business
Days (or such shorter period as shall be acceptable to such Issuing Bank and,
if less than one Business Day, the Administrative Agent) prior to any proposed
issuance of a Letter of Credit. Each such notice shall refer to this Agreement
and shall specify (i) the date on which such Letter of Credit is to be issued
(which shall be a Business Day), the face amount of such Letter of Credit
(which shall be an amount in dollars), (ii) the name and address of the
beneficiary, (iii) whether such Letter of Credit shall permit a single
drawing or multiple drawings, (iv) the form of the documents required
to be presented at the time of any drawing (together with the exact
wording of such documents or copies thereof) and (v) the expiry date of
such Letter of Credit (which shall conform to the provisions of paragraph
(b) above). Each Issuing Bank shall give the Administrative Agent, which
shall in turn give to each Issuing Bank and to each Lender, prompt written or
telecopy advice of any notice received from the Borrower pursuant to this
paragraph.
(d) By the issuance of a Letter of Credit and without any further
action on the part of the applicable Issuing Bank or the Lenders in respect
thereof, the applicable Issuing Bank hereby grants to each Lender, and each
Lender hereby acquires from such Issuing Bank, a participation in such Letter
of Credit equal to such Lender's Applicable Percentage at the time of any
drawing thereunder of the face amount of such Letter of Credit, effective upon
the issuance of such Letter of Credit. In addition, the applicable Issuing
Banks hereby grant to each Lender, and each Lender hereby acquires from such
Issuing Banks, a participation in each Existing Letter of Credit equal to such
Lender's Applicable Percentage at the time of any drawing thereunder of the
face amount of such Existing Letter of Credit, effective on the Closing Date.
In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, on
behalf of each Issuing Bank, in accordance with paragraph (f) below, such
Lender's Applicable Percentage of each unreimbursed LC Disbursement made by
such Issuing Bank; PROVIDED, HOWEVER, that the Lenders shall not be obligated
to make any such payment with respect to any wrongful payment or disbursement
made under any Letter of Credit to the extent resulting from the gross
negligence or wilful misconduct of such Issuing Bank.
(e) Each Lender acknowledges and agrees that its acquisition of
participations pursuant to paragraph (d) above in respect of Letters of Credit
is absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of any Default or the
failure of any condition precedent set forth in Article IV, and that each such
payment by a Lender pursuant to paragraph (d) above shall be made without any
offset, abatement, withholding or reduction whatsoever.
(f) On the date on which it shall have ascertained that any documents
presented under a Letter of Credit appear to be in conformity with the terms
and conditions of such Letter of Credit, the applicable Issuing Bank shall give
written or telecopy notice to the Borrower and the Administrative Agent of the
amount of the drawing and the date on which payment thereon has been or will be
made. If the Administrative Agent shall not have received from the Borrower the
payment required pursuant to paragraph (g) below by 12:00 noon, New York City
time, two Business Days after the date on which payment of a draft presented
under any Letter of Credit has been made, the Administrative Agent shall
promptly so notify the applicable Issuing Bank and each Lender, specifying in
the notice to each Lender
<PAGE> 33
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such Lender's Applicable Percentage of such LC Disbursement. Each Lender
shall pay to the Administrative Agent, not later than 2:00 p.m.,
New York City time, on such date, such Lender's Applicable Percentage of
such LC Disbursement, which the Administrative Agent shall
promptly pay to the applicable Issuing Bank. The Administrative Agent will
promptly remit to each Lender such Lender's Applicable Percentage of any
amounts subsequently received by the Administrative Agent from the Borrower in
respect of such LC Disbursement; PROVIDED that (i) amounts so received for the
account of any Lender prior to payment by such Lender of amounts required to be
paid by it hereunder in respect of any LC Disbursement and (ii) amounts
representing interest at the rate provided in paragraph (g) below on any LC
Disbursement for the period prior to the payment by such Lender of such amounts
shall in each case be remitted to the applicable Issuing Bank.
(g) If an Issuing Bank shall pay any draft presented under a Letter of
Credit, the Borrower shall pay to such Issuing Bank or to the Administrative
Agent for the account of such Issuing Bank or, if the Administrative Agent
shall have received the payments provided in paragraph (f) above with respect
to such drawing, for the accounts of the Lenders, an amount equal to the amount
of such draft before 12:00 noon, New York City time, on the second Business Day
immediately following the date of payment of such draft, together with interest
on such amount at a rate per annum equal to the interest rate in effect for
ABR Borrowings from (and including) the date of payment of such draft to (but
excluding) the date of such payment by the Borrower. The obligation of the
Borrower to pay the amounts referred to above in this paragraph (g) (and the
obligations of the Lenders under paragraphs (c) and (d) above) shall be
absolute, unconditional and irrevocable and shall be satisfied strictly in
accordance with their terms irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or of the obligations of the Borrower under any Loan Document;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any other person may at any time have
against the beneficiary under any Letter of Credit, the Agents, any
Issuing Bank or any Lender (other than the defense of payment in
accordance with the terms of this Agreement or a defense based on the
gross negligence or wilful misconduct of the applicable Issuing Bank)
or any other person in connection with this Agreement or any other
transaction;
(iii) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent or invalid in any respect or
any statement therein being untrue or inaccurate in any respect;
PROVIDED that payment by the applicable Issuing Bank under such Letter
of Credit against presentation of such draft or document shall not
have constituted gross negligence or wilful misconduct;
(iv) payment by the applicable Issuing Bank under a Letter of
Credit against presentation of a draft or other document which does
not comply in any immaterial respect with the terms of such Letter of
Credit; PROVIDED that such payment shall not have constituted gross
negligence or wilful misconduct; or
(v) any other circumstance or event whatsoever, whether or not
similar to any of the foregoing; PROVIDED that such other circumstance
or event shall not have been the result of gross negligence or wilful
misconduct of the applicable Issuing Bank.
It is understood that in making any payment under a Letter of Credit
(x) such Issuing Bank's exclusive reliance on the documents presented to it
under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary equals the amount of
such draft and whether or not any
<PAGE> 34
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document presented pursuant to such Letter of Credit proves to be forged,
fraudulent or invalid in any respect, if such document on its face appears
to be in order, and whether or not any other statement or any other document
presented pursuant to such Letter of Credit proves to be forged or invalid
or any statement therein proves to be inaccurate or untrue in any respect
whatsoever, and (y) any noncompliance in any immaterial respect of the
documents presented under a Letter of Credit with the terms thereof shall,
in either case, not, in and of itself, be deemed wilful misconduct or gross
negligence of such Issuing Bank.
SECTION 2.20. TAXES. (a) Any and all payments by the Borrower
hereunder to or for the benefit of a non-U.S. Person shall be made, in
accordance with Section 2.18, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto imposed by or on behalf
of the United States or any political subdivision thereof, EXCLUDING taxes
imposed on (or measured by) such non-U.S. Person's (including any transferee's
or assignee's (any such entity a "TRANSFEREE")) net income or net receipts,
franchise taxes, taxes on doing business or taxes imposed on capital or net
worth (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as
"TAXES"). If the Borrower shall be required by law to deduct any Taxes from or
in respect of any sum payable hereunder to a non-U.S. Person, (i) the sum
payable shall be increased by the amount necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.20) such non-U.S. Person shall receive an amount equal to
the sum it would have received had no such deductions been made, (ii) the
Borrower shall make such deductions and (iii) the Borrower shall pay the full
amount deducted to the relevant taxing authority or other Governmental
Authority in accordance with applicable law.
(b) The Borrower agrees to pay and reimburse on demand all transfer,
stamp, documentary or other similar taxes, assessments or charges levied by any
Governmental Authority in respect of this Agreement, any of the Loans or the
Letters of Credit (all such taxes, assessments or charges hereinafter referred
to as "OTHER TAXES").
(c) The Borrower will indemnify each Lender (or Transferee), each
Issuing Bank and the Administrative Agent for the full amount of Taxes and
Other Taxes (including any Taxes or Other Taxes imposed by the applicable
jurisdiction on amounts payable under this Section 2.20) paid by such Lender
(or Transferee), such Issuing Bank or the Administrative Agent, as the case may
be, and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other Taxes
were correctly or legally asserted by the relevant taxing authority or other
Governmental Authority. Such indemnification shall be made within 30 days after
the date such Lender (or Transferee), such Issuing Bank or the Administrative
Agent, as the case may be, makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes withheld by the Borrower in respect of any payment to a non-U.S. Person,
the Borrower will furnish to the Administrative Agent, at its address referred
to in Section 8.01 for delivery to such non-U.S. Person, the original or a
certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section 2.20 shall
survive the payment in full of the principal of and interest on all Loans made
hereunder and of all other amounts payable hereunder.
(f) Each Lender (or Transferee) and each Issuing Bank which is
organized outside the United States shall, if legally able to do so, upon
written request of the Borrower, deliver to the Borrower such certificates,
documents or other evidence, as required by the Code or Treasury Regulations
issued pursuant thereto, including Internal Revenue Service Form 1001 or Form
4224 or any subsequent version
<PAGE> 35
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thereof, properly completed and duly executed by such Lender (or Transferee) or
such Issuing Bank establishing that payments of interest are (i) not subject to
withholding under the Code because such interest income is effectively
connected with the conduct by such Lender (or Transferee) or such Issuing Bank
of a trade or business in the United States or (ii) exempt from United States
tax under a provision of an applicable tax treaty. Unless the Borrower and the
Administrative Agent have received forms or other documents satisfactory to
them indicating that payments hereunder are not subject to United States
withholding tax, the Borrower or the Administrative Agent shall withhold taxes
from such payments at the applicable statutory rate in the case of payments of
interest to or for any Lender (or Transferee), Issuing Bank or assignee that is
a non-U.S. Person.
(g) The Borrower shall not be required to pay any additional amounts
to any non-U.S. Person in respect of United States withholding tax pursuant to
paragraph (a) above (i) if the obligation to pay such additional amounts would
not have arisen but for a failure by such non-U.S. Person to comply with the
provisions of paragraph (f) above or (ii) in the case of a Transferee, to the
extent such additional amounts exceed the additional amounts that would have
been payable had no transfer or assignment to such Transferee occurred;
PROVIDED, HOWEVER, the Borrower shall be required to pay those amounts to any
Lender (or Transferee) and any Issuing Bank that it was required to pay
hereunder prior to the failure of such Lender (or Transferee) or such Issuing
Bank to comply with the provisions of such paragraph (f).
SECTION 2.21. TERMINATION OR ASSIGNMENT OF COMMITMENTS UNDER CERTAIN
CIRCUMSTANCES. (a) Any Lender (or Transferee) claiming any additional amounts
payable pursuant to Section 2.13 or Section 2.20 or exercising its rights under
Section 2.14 shall use reasonable efforts (consistent with legal and regulatory
restrictions) to file any certificate or document requested by the Borrower or
to change the jurisdiction of its applicable lending office if the making of
such a filing or change would avoid the need for or reduce the amount of any
such additional amounts which may thereafter accrue or avoid the circumstances
giving rise to such exercise and would not, in the sole determination of such
Lender, be otherwise disadvantageous to such Lender (or Transferee).
(b) In the event that any Lender shall have delivered a notice or
certificate pursuant to Section 2.13 or 2.14, or the Borrower shall be required
to make additional payments to any Lender under Section 2.20, the Borrower
shall have the right, at its own expense, upon notice to such Lender and the
Administrative Agent, (a) to terminate the Commitments of such Lender or (b) to
require such Lender to transfer and assign without recourse (in accordance with
and subject to the restrictions contained in Section 8.04) all its interests,
rights and obligations under this Agreement to another financial institution
acceptable to the Administrative Agent (which approval shall not be
unreasonably withheld) which shall assume such obligations; PROVIDED that (i)
no such termination or assignment shall conflict with any law, rule or
regulation or order of any Governmental Authority, (ii) the Borrower or the
assignee, as the case may be, shall pay to the affected Lender in immediately
available funds on the date of such termination or assignment the principal of
and interest accrued to the date of payment on the Loans made by it hereunder
and all other amounts accrued for its account or owed to it hereunder and (iii)
the Borrower shall not terminate Commitments representing more than 10% of the
original Total Commitment pursuant to this paragraph (b).
SECTION 2.22. SWINGLINE LOANS. (a) On the terms, subject to the
conditions and relying upon the representations and warranties herein set
forth, each Swingline Lender agrees, severally and not jointly, at any time and
from time to time on and after the date hereof and until the earlier of the
Business Day immediately preceding the Maturity Date and the termination of the
Swingline Commitment of such Swingline Lender, to make Swingline Loans to the
Borrower in an aggregate principal amount not to exceed such Swingline Lender's
Swingline Percentage of the lesser of (i) the difference between (A) the
aggregate Swingline Commitments and (B) the aggregate Swingline Exposures
immediately prior to the making of such Swingline Loans and (ii) the difference
between (A) the Total Commitment and (B) the sum
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of (x) the outstanding aggregate principal amount of all Loans immediately
prior to the making of such Swingline Loans and (y) the Aggregate LC Exposure
at such time; PROVIDED that the sum of the aggregate Swingline Exposures
and the aggregate Swingline Exposures (as defined in the Facility A Credit
Agreement) shall not exceed the lesser of (i) the sum of (x) the aggregate
Swingline Commitments and (y) the aggregate Swingline Commitments (as defined
in the Facility A Credit Agreement) and (ii) $1,000,000,000. Each Swingline
Loan shall be made as part of a Borrowing consisting of Swingline Loans made
by the Swingline Lenders ratably in accordance with their respective Swingline
Percentages (it being understood that (I) the failure of any Swingline Lender
to make any Swingline Loan shall not in itself relieve any other Swingline
Lender of its obligation to lend hereunder and (II) no Swingline Lender shall
be responsible for the failure of any other Swingline Lender to make any
Swingline Loan required to be made by such other Swingline Lender).
The Swingline Loans comprising any Swingline Borrowing shall be in an
aggregate principal amount that is an integral multiple of $1,000,000
and not less than $5,000,000 (or an aggregate principal amount equal
to the remaining balance of the available Swingline Commitments).
Each Swingline Lender shall make its portion of each Swingline Borrowing
available to the Borrower by means of a credit to the general deposit account
of the Borrower with the Administrative Agent or a wire transfer, at the
expense of the Borrower, to an account designated in writing by the Borrower,
in each case by 3:30 p.m., New York City time, on the date such Swingline
Borrowing is requested to be made pursuant to paragraph (b) below, in
immediately available funds. Within the limits set forth in the first sentence
of this paragraph, the borrower may borrow, pay or prepay and reborrow
Swingline Loans on or after the date hereof and prior to the Maturity
Date on the terms and subject to the conditions and limitations set forth
herein.
(b) The Borrower shall give the Administrative Agent telephonic,
written or telecopy notice substantially in the form of Exhibit G (in the case
of telephonic notice, such notice shall be promptly confirmed by telecopy) no
later than 2:30 p.m., New York City time, on the day of a proposed Swingline
Borrowing. Such notice shall be delivered on a Business Day, shall be
irrevocable and shall refer to this Agreement and shall specify the requested
date (which shall be a Business Day) and amount of such Swingline Borrowing.
The Administrative Agent shall promptly advise the Swingline Lenders of any
notice received from the Borrower pursuant to this paragraph (b).
(c) If the Borrower does not fully repay a Swingline Borrowing on or
prior to the last day of the Interest Period with respect thereto, the
Administrative Agent shall promptly notify each Lender thereof (by telecopy or
by telephone, confirmed in writing) and of its Applicable Percentage of such
Swingline Borrowing. Upon such notice but without any further action, each
Swingline Lender hereby agrees to grant to each Lender, and each Lender hereby
agrees to acquire from each Swingline Lender, a participation in such Swingline
Loan made by such Swingline Lender as part of such defaulted Swingline
Borrowing equal to such Lender's Applicable Percentage of the principal amount
of such Swingline Loan. In consideration and in furtherance of the foregoing,
each Lender hereby absolutely and unconditionally agrees, upon receipt of
notice as provided above, to pay to the Administrative Agent, for the account
of the applicable Swingline Lender, such Lender's Applicable Percentage of each
Swingline Borrowing (including the interest accrued thereon) that is not repaid
on the last day of the Interest Period with respect thereto. Each such payment
shall, for all purposes hereof, be deemed to be an ABR Loan to which, after the
first day thereof, default interest will apply. Each Lender acknowledges and
agrees that its obligation to acquire participations in such Swingline Loans
pursuant to this paragraph is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including the occurrence and
continuance of a Default or the failure of any condition precedent set forth in
Article IV, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Each Lender shall comply with
its obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.02(c) with respect to Loans
made by such Lender, and the Administrative Agent shall promptly pay to the
Swingline Lenders their respective shares of the amounts so received by it from
the Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph.
Notwithstanding anything herein to the contrary, the purchase of participations
<PAGE> 37
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in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower
of its default in respect of the payment thereof so long as ABR Loans that
resulted from any such default shall remain outstanding or any accrued interest
thereon shall remain unpaid.
(d) Upon written or telecopy notice to the Swingline Lenders and to
the Administrative Agent, the Borrower may at any time permanently terminate,
or from time to time in part permanently reduce, the Swingline Commitments of
the Swingline Lenders. Each reduction of the Swingline Commitments shall be
allocated pro rata among the Swingline Lenders in accordance with their
respective Swingline Percentages. On the date of any termination or reduction
of the Swingline Commitments pursuant to this paragraph (d), the Borrower shall
pay or prepay so much of the Swingline Borrowings as shall be necessary in
order that the aggregate outstanding principal amount of Swingline Loans will
not exceed the aggregate Swingline Commitments after giving effect to such
termination or reduction.
(e) The Borrower may prepay any Swingline Borrowing in whole or in
part at any time without premium or penalty; PROVIDED that the Borrower shall
have given the Administrative Agent written or telecopy notice (or telephone
notice promptly confirmed in writing or by telecopy) of such prepayment not
later than 10:30 a.m., New York City time, on the Business Day designated by
the Borrower for such prepayment; and PROVIDED FURTHER that each partial
payment shall be in an amount that is an integral multiple of $1,000,000. Each
notice of prepayment under this paragraph (e) shall specify the prepayment date
and The principal amount of each Swingline Borrowing (or portion thereof) to be
prepaid, shall be irrevocable and shall commit the Borrower to prepay such
Swingline Borrowing (or portion thereof) by the amount stated therein on the
date stated therein. All prepayments under this paragraph (e) shall be
accompanied by accrued interest on the principal amount being prepaid to the
date of payment. Each payment of principal of or interest on or any other
amount in respect of Swingline Loans shall be allocated, as between the
Swingline Lenders, pro rata in accordance with their respective Swingline
Percentages.
ARTICLE III. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders that:
SECTION 3.01. CORPORATE EXISTENCE. The Borrower and each Material
Subsidiary: (a) is a corporation, partnership or other entity duly organized
and validly existing under the laws of the jurisdiction of its organization;
(b) has all requisite corporate or other power, and has all material
governmental licenses, authorizations, consents and approvals, necessary to own
its assets and carry on its business as now being or as proposed to be
conducted, except where the failure to have any of the foregoing would not
result in a Material Adverse Effect; and (c) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure so to qualify would result in a
Material Adverse Effect.
SECTION 3.02. FINANCIAL CONDITION. (a) Each of (i) the consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as at December
31, 1993, and the related consolidated statements of income and cash flows of
the Borrower and its Consolidated Subsidiaries for the fiscal year ended on
such date, with the opinion thereon of Price Waterhouse, and (ii) the
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
at March 31, 1994, and the related consolidated statements of income and cash
flows of the Borrower and its Consolidated Subsidiaries for the fiscal quarter
ended on such date, all certified by a Financial Officer of the Borrower,
heretofore furnished to each of the Lenders, fairly present the consolidated
financial condition of the Borrower and its Consolidated Subsidiaries as at
such dates and the consolidated results of their operations for the fiscal year
or fiscal quarter ended on such dates in accordance with generally accepted
accounting principles (subject, in the case of the statements referred to in
clause (ii) above, to year-end audit adjustments). Neither the Borrower
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34
nor any of its Material Subsidiaries had on such dates any known material
contingent liability, except as referred to or reflected or provided for
in the Exchange Act Report (as defined in Section 3.03) or in such balance
sheet (or the notes thereto) as at such dates.
(b) There has been no material adverse change in the consolidated
financial condition, operations, assets, business or prospects taken as a whole
of the Borrower and its Consolidated Subsidiaries from that set forth in such
financial statements as at December 31, 1993 (it being agreed, however, that
none of (i) the reduction by any rating agency of any rating assigned to
Indebtedness of the Borrower, (ii) non-cash provisions for loan losses and
additions to valuation allowances, (iii) any change in GAAP or the Borrower's
compliance therewith and (iv) any legal or arbitral proceedings which have been
disclosed in the Exchange Act Report (as defined in Section 3.03), whether
threatened, pending, resulting in a judgment or otherwise, prior to the time a
final judgment for the payment of money shall have been recorded against the
Borrower and/or any of its Material Subsidiaries by any Governmental Authority
having jurisdiction, and the judgment is non-appealable (or the time for appeal
has expired) and all stays of execution have expired or been lifted shall, in
and of itself, constitute such a material adverse change).
SECTION 3.03. LITIGATION. Except as disclosed to the Lenders in the
Exchange Act Report filed prior to the Closing Date or otherwise disclosed in
writing to the Lenders prior to the Closing Date, as of the Closing Date there
are no legal or arbitral proceedings, or any proceedings by or before any
Governmental Authority, pending or (to the knowledge of the Borrower)
threatened against the Borrower or any of its Material Subsidiaries which
have resulted in a Material Adverse Effect. The "EXCHANGE ACT REPORT"
shall mean, collectively, the Annual Report of the Borrower on Form 10-K
for the year ended December 31, 1993, each Report on Form 8-K of the Borrower
filed subsequent to December 31, 1993 and prior to the date hereof, and the
Report of the Borrower on Form 10-Q for the Quarter ended March 31, 1994.
SECTION 3.04. NO BREACH. None of the execution and delivery of this
Agreement, the consummation of the transactions herein contemplated and
compliance with the terms and provisions hereof will conflict with or result in
a breach of, or require any consent under, the charter or By-laws of the
Borrower, or any applicable law or regulation, or any order, writ, injunction
or decree of any Governmental Authority, or any material agreement or
instrument to which the Borrower or any of its Material Subsidiaries is a party
or by which any of them is bound or to which any of them is subject, or
constitute a default under any such agreement or instrument, or result in the
creation or imposition of any Lien upon any of the revenues or assets of the
Borrower or any of its Material Subsidiaries pursuant to the terms of any such
agreement or instrument.
SECTION 3.05. CORPORATE ACTION. The Borrower has all necessary
corporate power and authority to execute, deliver and perform its obligations
under this Agreement; the execution, delivery and performance by the Borrower
of this Agreement have been duly authorized by all necessary corporate action
on its part; and this Agreement has been duly and validly executed and
delivered by the Borrower and constitutes, its legal, valid and binding
obligation, enforceable in accordance with its terms except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or similar laws of general applicability
affecting the enforcement of creditors' rights and (b) the application of
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
SECTION 3.06. APPROVALS. No authorizations, approvals or consents of,
and no filings or registrations with, any Governmental Authority are necessary
for the execution, delivery or performance by the Borrower of this Agreement or
for the validity or enforceability hereof.
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SECTION 3.07. USE OF LOANS. Neither the Borrower nor any of its
Subsidiaries is engaged principally in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or carrying
Margin Stock and no part of the proceeds of any Loan hereunder will be used to
buy or carry any Margin Stock in violation of Regulation G or U.
SECTION 3.08. ERISA. The Borrower and, to the best of its knowledge,
its ERISA Affiliates have fulfilled their respective obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code except where any failure or non-compliance
would not result in a Material Adverse Effect.
SECTION 3.09. TAXES. United States Federal income tax returns of the
Borrower and its Material Subsidiaries have been examined and closed through
the fiscal year of the Borrower ended December 31, 1986. The Borrower and its
Material Subsidiaries have filed all United States Federal income tax returns
and all other material tax returns which are required to be filed by them and
have paid all taxes shown as due on such returns or pursuant to any assessment
received by the Borrower or any of its Material Subsidiaries, except those
being contested and reserved against in accordance with Section 5.03.
SECTION 3.10. INVESTMENT COMPANY ACT. The Borrower is not an
"INVESTMENT COMPANY", or a company "CONTROLLED" by an "INVESTMENT COMPANY",
within the meaning of the Investment Company Act of 1940, as amended.
SECTION 3.11. PUBLIC UTILITY HOLDING COMPANY ACT. The Borrower is not
subject to regulation as a "HOLDING COMPANY", subject to regulation as an
"AFFILIATE" of a "HOLDING COMPANY", or subject to regulation as a "SUBSIDIARY
COMPANY" of a "HOLDING COMPANY", under the Public Utility Holding Company Act
of 1935, as amended.
SECTION 3.12. HAZARDOUS MATERIALS. The Borrower and each of its
Subsidiaries have obtained all permits, licenses and other authorizations which
are required under all Environmental Laws, except to the extent failure to have
any such permit, license or authorization has not resulted in a Material
Adverse Effect. The Borrower and each of its Subsidiaries are in compliance
with the terms and conditions of all such permits, licenses and authorizations,
and are also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law or in any regulation,
code, plan, order, decree, judgment, injunction, notice or demand letter
issued, entered, promulgated or approved thereunder, except to the extent
failure to comply would not result in a Material Adverse Effect.
SECTION 3.13. MATERIAL SUBSIDIARIES, ETC. Set forth in Schedule 3.13
is a complete and correct list, as of the Closing Date, of all Material
Subsidiaries of the Borrower.
SECTION 3.14. NO MATERIAL MISSTATEMENTS. No written information,
report, financial statement, exhibit or schedule (the "INFORMATION") furnished
by or on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of any Loan Document or the facility
contemplated thereby or included therein or delivered pursuant thereto
contained as of the time it was furnished any material misstatement of fact or
omitted as of such time to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were,
are or will be made, not misleading; PROVIDED that, with respect to Information
consisting of statements, estimates and projections regarding the future
performance of the Borrower and its Subsidiaries ("PROJECTIONS"), no
representation or warranty is made other than that such Projections have been
prepared in good faith utilizing due and careful consideration and the best
information available to the Borrower at the time of preparation thereof.
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ARTICLE IV. CONDITIONS OF EFFECTIVENESS AND LENDING
The obligations of the Lenders to make Loans and the obligations of
the Issuing Banks to issue Letters of Credit hereunder are subject to the
satisfaction of the conditions set forth in Sections 4.01 and 4.02 below.
SECTION 4.01. INITIAL CREDIT EVENT. The obligation of each Lender to
make its initial Loan and of each Issuing Bank to issue its initial Letter of
Credit is subject to the satisfaction of the following conditions:
(a) The Administrative Agent shall have received a favorable written
opinion of Louis J. Briskman, Esq., Senior Vice President and General Counsel
of the Borrower, to the effect set forth in Exhibit F, dated the Closing Date
and addressed to the Lenders.
(b) All legal matters incident to this Agreement and the borrowings
hereunder shall be satisfactory to the Lenders and their counsel and to
Cravath, Swaine & Moore, counsel for the Administrative Agent.
(c) The Administrative Agent shall have received (i) a copy of the
articles of incorporation, including all amendments thereto, of the Borrower,
certified as of a recent date by the Secretary of State of the Commonwealth of
Pennsylvania, and a certificate as to the good standing of the Borrower as of a
recent date, from such Secretary of State; (ii) a certificate of the Secretary
or Assistant Secretary of the Borrower dated the Closing Date and certifying
(A) that attached thereto is a true and complete copy of the by-laws of the
Borrower as in effect on the Closing Date and at all times since a date prior
to the date of the resolutions described in clause (B) below, (B) that
attached thereto is a true and complete copy of resolutions duly adopted
by the Board of Directors of the Borrower authorizing the execution, delivery
and performance of the Loan Documents and the borrowings hereunder, and that
such resolutions have not been modified, rescinded or amended and are in full
force and effect, (C) that the articles of incorporation of the Borrower have
not been amended since the date of the last amendment thereto shown on the
certificate of good standing furnished pursuant to clause (i) above, and (D) as
to the incumbency and specimen signature of each officer executing any Loan
Document or any other document delivered in connection herewith on behalf of
the Borrower; (iii) a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing the
certificate pursuant to (ii) above; and (iv) such other documents as the
Lenders or their counsel or Cravath, Swaine & Moore, counsel for the
Administrative Agent, may reasonably request.
(d) The Administrative Agent shall have received a certificate from
the Borrower, dated the Closing Date and signed by a Financial Officer of the
Borrower, confirming compliance with the conditions precedent set forth in
paragraphs (b) and (c) of Section 4.02.
(e) The commitments under the Existing Credit Agreement shall have
been permanently terminated and all loans and other obligations under or in
connection therewith shall have been paid in full or shall be paid in full with
the proceeds of the initial borrowings hereunder and under the Facility A
Credit Agreement.
(f) The Administrative Agent shall have received on behalf of itself
and the Lenders entitled thereto all fees due and payable on or prior to the
date of this Agreement under the Fee Letters.
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SECTION 4.02. ALL CREDIT EVENTS. The obligation of each Lender to make
each Loan, and the obligation of each Issuing Bank to issue each Letter of
Credit, are subject to the satisfaction of the following conditions:
(a) The Administrative Agent shall have received a request
for, or notice of, such Credit Event if and as required by Section
2.03, Section 2.04, Section 2.19 or Section 2.22, as applicable.
(b) The representations and warranties set forth in Article
III (except, in the case of a refinancing of a Borrowing with a new
Borrowing that does not increase the aggregate principal amount of the
Loans of any Lender outstanding, the representations set forth in
Section 3.02(b) and 3.12) shall be true and correct in all material
respects on and as of the date of such Borrowing with the same effect
as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date.
(c) At the time of and immediately after such Borrowing or
issuance no Default shall have occurred and be continuing.
Each Credit Event shall be deemed to constitute a representation and warranty
by the Borrower on the date of such Credit Event as to the matters specified in
paragraphs (b) and (c) of this Section 4.02.
ARTICLE V. COVENANTS
The Borrower covenants and agrees with each Lender that, as long as
the Commitments shall be in effect or the principal of or interest on any Loan
shall be unpaid, or there shall be any Aggregate LC Exposure, unless the
Required Lenders shall otherwise consent in writing:
SECTION 5.01. FINANCIAL STATEMENTS. The Borrower shall deliver to each
of the Lenders:
(a) within 55 days after the end of each of the first three
quarterly fiscal periods of each fiscal year of the Borrower,
consolidated statements of income and cash flows of the Borrower and
its Consolidated Subsidiaries for such period and for the period from
the beginning of the respective fiscal year to the end of such period,
and the related consolidated balance sheet as at the end of such
period, setting forth in each case in comparative form the
corresponding consolidated figures for the corresponding period in the
preceding fiscal year, accompanied by a certificate of a Financial
Officer of the Borrower which certificate shall state that such
financial statements fairly present the consolidated financial
condition and results of operations of the Borrower and its
Consolidated Subsidiaries in accordance with GAAP as at the end of,
and for, such period, subject to normal year-end audit adjustments
(provided that the requirement herein for the furnishing of such
quarterly financial statements may be fulfilled by providing to the
Lenders the report of the Borrower to the SEC on Form 10-Q for the
applicable quarterly period, accompanied by the officer's certificate
described above);
(b) within 105 days after the end of each fiscal year of the
Borrower, consolidated statements of income and cash flows of the
Borrower and its Consolidated Subsidiaries for such year and the
related consolidated balance sheet as at the end of such year, setting
forth in comparative form the corresponding consolidated figures for
the preceding fiscal year, and accompanied by an opinion thereon
(unqualified as to the scope of the audit) of independent certified
public accountants of recognized national standing, which opinion
shall state that such consolidated financial statements fairly present
the consolidated financial condition and results of operations of the
Borrower and its Consolidated Subsidiaries as at the end of, and for,
such fiscal
<PAGE> 42
38
year (provided that the requirement herein for the furnishing of
annual financial statements may be fulfilled by providing to the
Lenders the report of the Borrower to the SEC on Form 10-K
for the applicable fiscal year);
(c) promptly upon their becoming publicly available, copies of
all registration statements and regular periodic reports (including
without limitation any and all reports on Form 8-K), if any, which the
Borrower or any of its Subsidiaries shall have filed with the SEC or
any national securities exchange;
(d) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports
and proxy statements so mailed;
(e) within 30 days after a Responsible Officer of the Borrower
knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan have
occurred or exist which would reasonably be expected to result in a
Material Adverse Effect, a statement signed by a senior financial
officer of the Borrower setting forth details respecting such event or
condition and the action, if any, which the Borrower or its ERISA
Affiliate proposes to take with respect thereto (and a copy of any
report or notice required to be filed with or given to PBGC by
the Borrower or an ERISA Affiliate with respect to such event or
condition):
(i) any reportable event, as defined in Section
4043(b) of ERISA and the regulations issued thereunder, with
respect to a Plan, as to which PBGC has not by regulation
waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event
(provided that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA shall be a
reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code);
(ii) the filing under Section 4041 of ERISA of a
notice of intent to terminate any Plan or the termination of
any Plan;
(iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Borrower or any ERISA Affiliate of a notice
from a Multiemployer Plan that such action has been taken by
PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal by the
Borrower or any ERISA Affiliate under Section 4201 or 4204 of
ERISA from a Multiemployer Plan, or the receipt by the
Borrower or any ERISA Affiliate of notice from a Multiemployer
Plan that it is in reorganization or insolvency pursuant to
Section 4241 or 4245 of ERISA or that it intends to terminate
or has terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against the Borrower or any ERISA
Affiliate to enforce Section 515 of ERISA, which proceeding is
not dismissed within 30 days; and
(vi) a failure to make a required installment or
other payment with respect to a Plan (within the meaning of
Section 412(n) of the Code), in which case the notice required
hereunder shall be provided within 10 days after the due date
for filing notice of such failure with the PBGC;
<PAGE> 43
39
(f) promptly after a Responsible Officer of the Borrower knows
or has reason to believe that any Default has occurred, a notice of
such Default describing it in reasonable detail and, together with
such notice or as soon thereafter as possible, a description of the
action that the Borrower has taken and proposes to take with respect
thereto;
(g) promptly after a Responsible Officer of the Borrower knows
that any change has occurred in the rating assigned to the Borrower's
Index Debt by any of Moody's, S&P or Fitch, a notice describing such
change; and
(h) promptly from time to time such other information
regarding the financial condition, operations or business of the
Borrower or any of its Subsidiaries (including, without limitation,
any Plan or Multiemployer Plan and any reports or other information
required to be filed under ERISA) as any Lender through the
Administrative Agent may reasonably request.
The Borrower will furnish to the Administrative Agent and each Lender, at the
time it furnishes each set of financial statements pursuant to paragraph (a) or
(b) above, a certificate (which may be a copy in the case of each Lender) of a
Financial Officer of the Borrower (i) to the effect that no Default has
occurred and is continuing (or, if any Default has occurred and is continuing,
describing it in reasonable detail and describing the action that the Borrower
has taken and proposes to take with respect thereto), and (ii) setting forth
in reasonable detail the computations necessary to determine whether the
Borrower is in compliance with Sections 5.07, 5.08 and 5.09 as of the end of
the respective quarterly fiscal period or fiscal year.
SECTION 5.02. LITIGATION. The Borrower will promptly give to each
Lender notice of the commencement of all legal or arbitral proceedings, and of
all proceedings by or before any governmental or regulatory authority or
agency, affecting the Borrower or any of its Material Subsidiaries, which would
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.03. CORPORATE EXISTENCE, ETC. The Borrower will, and will
cause each of its Material Subsidiaries to, preserve and maintain its legal
existence and all of its material rights, privileges and franchises (provided
that (i) nothing in this Section 5.03 shall prohibit any transaction expressly
permitted under Section 5.05 and (ii) the Borrower or such Material Subsidiary
shall not be required to preserve or maintain any such right, privilege or
franchise if the board of directors of the Borrower or such Material
Subsidiary, as the case may be, shall determine that the preservation or
maintenance thereof is no longer desirable in the conduct of the business of
the Borrower or such Material Subsidiary, as the case may be); comply with the
requirements of all applicable laws, rules, regulations and orders of
Governmental Authorities if failure to comply with such requirements would
reasonably be expected to result in a Material Adverse Effect; pay and
discharge all material taxes, assessments and governmental charges or levies
imposed on it or on its income or profits or on any of its property prior to
the date on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being contested in good
faith and by proper proceedings and against which adequate reserves are being
maintained; maintain all its property used or useful in its business in good
working order and condition, ordinary wear and tear excepted, all as in the
judgment of the Borrower or such Material Subsidiary may be necessary so that
the business carried on in connection therewith may be properly and
advantageously conducted at all times (provided that the Borrower or such
Material Subsidiary shall not be required to maintain any such property if the
failure to maintain any such property is, in the judgment of the Borrower or
such Material Subsidiary, desirable in the conduct of the business of the
Borrower or such Material Subsidiary); and permit representatives of any Agent,
during normal business hours upon reasonable advance notice, to discuss its
business and affairs with its Financial Officers or their designees, all to the
extent reasonably requested by such Agent.
SECTION 5.04. INSURANCE. The Borrower will, and will cause each of its
Material Subsidiaries to, keep insured by financially sound and reputable
insurers all property of a character usually insured by corporations
<PAGE> 44
40
engaged in the same or similar business and similarly situated against loss or
damage of the kinds and in the amounts customary for such corporations and
carry such other insurance as is usually carried by such corporations (it being
understood that insurance and self-insurance shall be permitted to the extent
consistent with prudent business practice and customary among such
corporations).
SECTION 5.05. PROHIBITION OF FUNDAMENTAL CHANGES. The Borrower will
not, nor will it permit any of its Material Subsidiaries to, (i) enter into any
transaction of merger or consolidation or (ii) convey, sell, lease, transfer or
otherwise dispose of, in one transaction or a series of related transactions,
all or a substantial part (determined by reference to the Borrower and its
Subsidiaries taken as a whole) of its business or property, whether now owned
or hereafter acquired (excluding (i) financings by way of sales of receivables
or inventory, (ii) inventory or other Property sold or disposed of in the
ordinary course of business and (iii) obsolete or worn-out property, tools or
equipment no longer used or useful in its business). Notwithstanding the
foregoing provisions of this Section 5.05:
(A) any Subsidiary of the Borrower may be merged or
consolidated with or into: (i) the Borrower if the Borrower shall be
the continuing or surviving corporation or (ii) any other such
Subsidiary; provided that if any such transaction shall be between a
Subsidiary and a Wholly Owned Subsidiary, the Wholly Owned Subsidiary
shall be the continuing or surviving corporation;
(B) any Subsidiary of the Borrower may convey, sell, lease,
transfer or otherwise dispose of any of or all its property (upon
voluntary liquidation or otherwise) to the Borrower or a Wholly Owned
Subsidiary of the Borrower;
(C) the Borrower may merge or consolidate with or into any
other person if (i) either (x) the Borrower is the continuing or
surviving corporation or (y) the corporation formed by such
consolidation or into which the Borrower is merged shall be a
corporation organized under the laws of the United States of America,
any State thereof or the District of Columbia and shall expressly
assume the obligations of the Borrower hereunder pursuant to a written
agreement and shall have delivered to the Administrative Agent such
agreement and a certificate of a Responsible Officer and an opinion of
counsel to the effect that such merger or consolidation complies with
this Section 5.05(C), and (ii) after giving effect thereto and to any
repayment of Loans to be made upon the consummation thereof no Default
would exist;
(D) any Subsidiary of the Borrower may merge or consolidate
with or into any other person if, after giving effect thereto and to
any repayment of Loans to be made upon the consummation thereof, no
Default shall have occurred and be continuing; and
(E) the Borrower or any Subsidiary of the Borrower may convey,
sell, lease, transfer or otherwise dispose of its property if, after
giving effect thereto and to any repayment of Loans to be made upon
the consummation thereof (it being expressly understood that no
repayment of Loans is required solely by virtue thereof), no Default
shall have occurred and be continuing.
SECTION 5.06. LIMITATION ON LIENS. The Borrower will not, nor will it
permit any of its Material Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon any of its Property, whether now owned or hereafter
acquired, without causing such Lien to equally and ratably secure the
obligations of the Borrower hereunder and causing such Lien to include a Lien
on the proceeds of any secured assets which are sold; provided that the
foregoing restrictions shall not apply to:
(a) Liens imposed by any Governmental Authority for taxes,
assessments or charges not yet due and payable or which are being
contested in good faith and by appropriate proceedings if adequate
reserves with respect thereto are maintained;
<PAGE> 45
41
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, architects' or other like Liens arising in the ordinary
course of business which are not overdue for a period of more than 30
days or which are being contested in good faith and by appropriate
proceedings;
(c) Liens securing judgments or to perfect an appeal of any
order or decree but only to the extent, for an amount and for a period
not resulting in an Event of Default under paragraph (h) of Article
VI;
(d) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(e) pledges or deposits to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory
obligations to secure surety, appeal or performance bonds and
contractual and other obligations of a like nature incurred in the
ordinary course of business and not involving the borrowing of money;
(f) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of property or minor imperfections in title
thereto and Liens under leases and subleases which, in the aggregate,
are not material in amount, and which do not interfere in any material
respects with the ordinaryconduct of the business of the Borrower and
its Subsidiaries taken as a whole;
(g) Liens on property of any Subsidiary of the Borrower or of
any person which is or was merged with or into the Borrower or any
Subsidiary thereof, PROVIDED that such Liens are or were in existence
at the time such entity becomes or became a Subsidiary of the Borrower
and were not created in anticipation thereof other than to finance the
purchase thereof;
(h) Liens upon real and/or personal property acquired (by
purchase, construction, foreclosure, deed in lieu of foreclosure or
otherwise) by the Borrower or any of its Subsidiaries, each of which
Liens either (A) existed on such property before the time of its
acquisition and was not created in anticipation thereof or (B) was
created solely for the purpose of securing Indebtedness representing,
or incurred to finance, refinance or refund, all or a part of the cost
(including the cost of construction) of such property or improvements
thereon; PROVIDED that no such Lien shall extend to or cover any
property of the Borrower or such Subsidiary other than the respective
property so acquired and improvements thereon;
(i) mortgages on property securing indebtedness in favor of
the United States of America or any state thereof, or any department,
agency or instrumentality or political subdivision of the United
States of America or any state thereof, incurred for the purpose of
financing all or any part of the purchase price or the cost of
construction of the property subject to such mortgages (including
without limitation such debt secured by such mortgages in connection
with pollution control, industrial revenue or similar financings) or
incurred to secure progress, advance or other payments pursuant to any
contract or provision of any statute;
(j) Liens securing Indebtedness owed to the Borrower or to any
Wholly Owned Subsidiary of the Borrower;
(k) Liens (i) upon the receivables and inventory of the
Borrower or any of its Subsidiaries to secure Indebtedness resulting
from financings of such receivables and inventory in an aggregate
amount not greater than $800,000,000 less the aggregate amount of
Indebtedness that is secured pursuant to clause (ii) below, provided
that the terms of such Indebtedness do not provide for any
<PAGE> 46
42
recourse to the Borrower or any Material Subsidiary (except to the
extent of breaches of representations and warranties of the Borrower or
any of its Subsidiaries in connection with such financings and other
recourse customary in connection with "OFF-BALANCE SHEET" financings)
and (ii) upon the property of the Borrower to secure Indebtedness of
the Borrower in an aggregate amount not greater than $250,000,000;
(l) additional Liens upon real and/or personal Property,
provided that the aggregate outstanding principal amount of the
Indebtedness (other than Indebtedness as defined in subsection (f) of
the definition thereof which has not been assumed by the Borrower or
any of its Subsidiaries and where the Lien relates to property
acquired by the Borrower or any of its Subsidiaries in satisfaction,
in whole or in part, of indebtedness to the Borrower or any of its
Subsidiaries, in the ordinary course of business) or liabilities
secured thereby shall not exceed $250,000,000 at any time;
(m) any extension, renewal or replacement of the foregoing;
provided, however, that, except to the extent otherwise permitted by
Section 5.06 (including Section 5.06(l)), the Liens permitted
hereunder shall not be spread to cover any additional Indebtedness or
property (other than a substitution of like property or improvements
on such property or other property of equivalent value); and
(n) Liens upon real and/or personal property owned at the date
hereof by WCI or LW Real Estate Investments, L.P.
SECTION 5.07. CONSOLIDATED LEVERAGE RATIO. The Borrower's Consolidated
Leverage Ratio will not at any time (a) during the period from the Closing Date
to and including June 30, 1995, exceed 4.0 to 1; (b) during the period from and
including July 1, 1995 to and including December 31, 1995, exceed 3.75 to 1;
(c) during the period from and including January 1, 1996 to and including
December 31, 1996, exceed 3.3 to 1; or (d) after December 31, 1996, exceed 3.0
to 1.
SECTION 5.08. CONSOLIDATED COVERAGE RATIO. The Borrower's Consolidated
Coverage Ratio for any period of four consecutive fiscal quarters, which period
ends on or after the date hereof, measured at the end of each fiscal quarter
shall not be less than the ratio set forth below opposite the period during
which such quarter ends:
<TABLE>
Period Ratio
------ -----
<S> <C>
From the Closing Date to September 30, 1995 2.25 to 1
After September 30, 1995 2.50 to 1
</TABLE>
SECTION 5.09. MINIMUM CONSOLIDATED NET WORTH. (a) The Borrower will
not permit its Consolidated Net Worth at any date to be less than that set
forth below opposite the period during which such date occurs:
<TABLE>
Period Amount
------ ------
<S> <C>
Closing Date to and
including June 30, 1995 $750,000,000
July 1, 1995 to and
including September 30, 1995 $850,000,000
</TABLE>
<PAGE> 47
43
October 1, 1995 to and
including March 31, 1996 $1,000,000,000
(b) The Borrower will not permit its Consolidated Net Worth at any
date after March 31, 1996 (each such date of determination pursuant to this
paragraph (b) being referred to herein as the "DETERMINATION DATE") to be less
than (i) $1,000,000,000 plus (ii) for each full fiscal quarter commencing after
December 31, 1995 and ending prior to the Determination Date, one half the
amount of the excess (if any) of (x) the amount of Consolidated Net Income (if
positive) for each such fiscal quarter over (y) the amount of all dividends
(other than dividends paid in common stock of the Borrower) paid by the
Borrower during each such fiscal quarter.
SECTION 5.10. TRANSACTIONS WITH AFFILIATES. The Borrower will not, nor
will it permit any of its Material Subsidiaries to, directly or indirectly
enter into any material transaction with any Affiliate of the Borrower except
on terms at least as favorable to the Borrower or such Subsidiary as it could
obtain on an arm's-length basis.
SECTION 5.11. USE OF PROCEEDS. The Borrower will use the proceeds of
the Loans hereunder solely to replace the Existing Credit Agreement, to provide
working capital and for other general corporate purposes (in compliance with
all applicable legal and regulatory requirements, including, without
limitation, Regulations G and U and the Securities Act of 1933, as amended, and
the Securities Exchange Act of 1934, as amended, and the regulations
thereunder); PROVIDED that neither any of the Agents nor any Lender shall have
any responsibility as to the use of any of such proceeds.
SECTION 5.12. FISCAL YEAR. The Borrower shall not change its fiscal
year.
ARTICLE VI. EVENTS OF DEFAULT
In case of the happening of any of the following events ("EVENTS OF
DEFAULT"):
(a) the Borrower shall default in the payment when due of any
principal of any Loan; or the Borrower shall default in the payment
when due of any interest on any Loan, any reimbursement obligation in
respect of any LC Disbursement, any Fee or any other amount payable by
it hereunder or under any other Loan Document and such default shall
continue unremedied for a period of five Business Days;
(b) any representation, warranty or certification made or
deemed made herein (or in any modification or supplement hereto) by
the Borrower, or any certificate furnished to any Lender or the
Administrative Agent pursuant to the provisions hereof (or thereof),
shall prove to have been false or misleading as of the time made,
deemed made or furnished in any material respect;
(c) the Borrower shall default in the performance of any of
its obligations under Section 5.01(f), Section 5.05 through 5.09
(inclusive) or Section 5.11; or the Borrower shall default in the
performance of any of its other obligations under this Agreement and
such default shall continue unremedied for a period of 15 days after
notice thereof to the Borrower by the Administrative Agent or any
Lender (through the Administrative Agent);
(d) the Borrower or any Subsidiary shall (i) fail to pay at
maturity any Indebtedness (other than Indebtedness as defined in
subsection (f) of the definition thereof which has not been assumed by
the Borrower or any of its Subsidiaries and where the Lien relates to
property acquired by the
<PAGE> 48
44
Borrower or any of its Subsidiaries in satisfaction, in whole or in
part, of indebtedness to the Borrower or any of its Subsidiaries, in
the ordinary course of business of WFSI, any of its Subsidiaries,
Financial Services or WCI) in an aggregate amount in excess of
$100,000,000, or (ii) fail to make any payment (whether of principal,
interest or otherwise), regardless of amount, due in respect of, or
fail to observe or perform any other term, covenant, condition or
agreement contained in any agreement or instrument evidencing or
governing, any such Indebtedness in excess of $100,000,000 if the
effect of any failure referred to in this clause (ii) (x) is to cause,
or to permit the holder or holders of such Indebtedness or a trustee
on its or their behalf to cause, such Indebtedness to become due prior
to its stated maturity or (y) has caused such Indebtedness to become
due prior to its stated maturity (it being agreed that for purposes of
this paragraph (d) only (other than subclause(ii)(x) of this paragraph
(d)), the term "INDEBTEDNESS" shall include obligations under any
interest rate protection agreement, foreign currency exchange
agreement or other interest or exchange rate hedging agreement and
that the amount of any person's obligations under any such agreement
shall be the net amount that such person could be required to pay as a
result of a termination thereof by reason of a default thereunder);
(e) the Borrower or any of its Material Subsidiaries shall
admit in writing its inability, or be generally unable, to pay its
debts as such debts become due;
(f) the Borrower or any of its Material Subsidiaries shall (i)
apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself
or of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a
voluntary case under the Bankruptcy Code (as now or hereafter in
effect), (iv) file a petition seeking to take advantage of any other
law relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or readjustment of debts, (v) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the Bankruptcy
Code, or (vi) take any corporate action for the purpose of effecting
any of the foregoing;
(g) a proceeding or case shall be commenced, without the
application or consent of the Borrower or any of its Material
Subsidiaries, in any court of competent jurisdiction, seeking (i) its
liquidation, reorganization, dissolution or winding-up, or the
composition or readjustment of its debts, (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like of the Borrower
or such Material Subsidiary or of all or any substantial part of its
assets, or (iii) similar relief in respect of the Borrower or such
Material Subsidiary under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and
such proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of 60 or
more days; or an order for relief against the Borrower or such
Material Subsidiary shall be entered in an involuntary case under the
Bankruptcy Code;
(h) a final judgment or judgments for the payment of money in
excess of $100,000,000 in the aggregate shall be rendered by one or
more courts, administrative tribunals or other bodies having
jurisdiction against the Borrower and/or any of its Material
Subsidiaries and the same shall not be paid or discharged (or
provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 60 days from the date
of entry thereof and the Borrower or the relevant Material Subsidiary
shall not, within said period of 60 days, or such longer period during
which execution of the same shall have been stayed, appeal therefrom
and cause the execution thereof to be stayed during such appeal;
(i) an event or condition specified in Section 5.01(e) shall
occur or exist with respect to any Plan or Multiemployer Plan and, as
a result of such event or condition, together with all other
<PAGE> 49
45
such events or conditions, the Borrower or any ERISA Affiliate shall
incur or in the good faith opinion of the Required Lenders shall be
reasonably likely to incur a liability to a Plan, a Multiemployer Plan
or PBGC (or any combination of the foregoing) which would constitute,
in the good faith determination of the Required Lenders, a Material
Adverse Effect; or
(j) a Change of Control shall have occurred or, with respect
to any period of 25 consecutive calendar months (whether commencing
before or after the date of this Agreement), individuals who were
directors of the Borrower on the first day of such period or who were
nominated by such directors shall no longer occupy a majority of the
seats (other than vacant seats) on the board of directors of the
Borrower (excluding by reason of the death or retirement of any
director);
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (f) or (g) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take any of or all the
following actions, at the same or different times: (i) terminate forthwith the
Commitments, (ii) declare the Loans then outstanding to be forthwith due and
payable in whole or in part, whereupon the principal of the Loans so declared
to be due and payable, together with accrued interest thereon and any unpaid
accrued Fees and all other liabilities of the Borrower accrued hereunder and
under any other Loan Document, shall become forthwith due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything contained herein or in any
other Loan Document to the contrary notwithstanding and (iii) require that the
Borrower deposit cash with the Administrative Agent, in an amount equal to the
Aggregate LC Exposure, as collateral security for the repayment of any future
LC Disbursements; and in any event with respect to the Borrower described in
paragraph (f) or (g) above, the Commitments shall automatically terminate and
the principal of the Loans then outstanding, together with accrued interest
thereon and any unpaid accrued Fees and all other liabilities of the Borrower
accrued hereunder and under any other Loan Document, shall automatically become
due and payable and the Borrower shall be required to deposit cash with the
Administrative Agent, in an amount equal to the Aggregate LC Exposure, as
collateral security for the repayment of any future drawings under the Letters
of Credit, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by the Borrower, anything
contained herein or in any other Loan Document to the contrary notwithstanding.
ARTICLE VII. THE AGENTS
In order to expedite the transactions contemplated by this Agreement,
the Agents are hereby appointed to act as Agents and Chemical Bank is hereby
appointed to act as Administrative Agent on behalf of the Lenders. Each of the
Lenders and the Issuing Banks hereby irrevocably authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
specifically delegated to the Administrative Agent by the terms and provisions
hereof and of the other Loan Documents, together with such actions and powers
as are reasonably incidental thereto. The Administrative Agent is hereby
expressly authorized by the Lenders and the Issuing Banks, without hereby
limiting any implied authority, (a) to receive on behalf of the Lenders all
payments of principal of and interest on the Loans and the LC Disbursements and
all other amounts due to the Lenders and Issuing Banks hereunder, and promptly
to distribute to each Lender and Issuing Bank its proper share of each payment
so received; (b) to give notice on behalf of each of the Lenders to the
Borrower of any Event of Default specified in this Agreement of which the
Administrative Agent has actual knowledge acquired in connection with its
agency hereunder; and (c) to distribute to each Lender and Issuing Bank copies
of all notices, financial statements and other materials delivered by the
Borrower pursuant to this Agreement as received by the Administrative Agent.
<PAGE> 50
46
Neither any Agent nor any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted by any of them
except for its or his own gross negligence or wilful misconduct, or be
responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by
the Borrower of any of the terms, conditions, covenants or agreements contained
in any Loan Document. The Agents shall not be responsible to the Lenders for
the due execution, genuineness, validity, enforceability or effectiveness of
this Agreement or any other Loan Documents or other instruments or agreements.
The Administrative Agent shall in all cases be fully protected in acting, or
refraining from acting, in accordance with written instructions signed by the
Required Lenders and, except as otherwise specifically provided herein, such
instructions and any action or inaction pursuant thereto shall be binding on
all the Lenders and the Issuing Banks. The Administrative Agent shall, in the
absence of knowledge to the contrary, be entitled to rely on any instrument or
document believed by it in good faith to be genuine and correct and to have
been signed or sent by the proper person or persons. Neither the Agents nor any
of their directors, officers, employees or agents shall have any responsibility
to the Borrower on account of the failure of or delay in performance or breach
by any Lender or Issuing Bank of any of its obligations hereunder or to any
Lender or Issuing Bank on account of the failure of or delay in performance or
breach by any other Agent, any other Lender or Issuing Bank or the Borrower of
any of their respective obligations hereunder or under any other Loan Document
or in connection herewith or therewith. The Administrative Agent may execute
any and all duties hereunder by or through agents or employees and shall be
entitled to rely upon the advice of legal counsel selected by it with respect
to all matters arising hereunder and shall not be liable for any action taken
or suffered in good faith by it in accordance with the advice of such counsel.
The Lenders and the Issuing Banks hereby acknowledge that the
Administrative Agent shall be under no duty to take any discretionary action
permitted to be taken by it pursuant to the provisions of this Agreement unless
it shall be requested in writing to do so by the Required Lenders.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, the Administrative Agent may resign at
any time by notifying the Lenders, the Issuing Banks and the Borrower. Upon any
such resignation, the Required Lenders shall have the right to appoint from the
Lenders a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint from the
Lenders a successor Administrative Agent which shall be a bank with an office
in New York, New York, having a combined capital and surplus of at least
$500,000,000 or an Affiliate of any such bank, which successor shall be
acceptable to the Borrower (such acceptance not to be unreasonably withheld).
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor bank, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent and
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After the Administrative Agent's resignation hereunder,
the provisions of this Article and Section 8.05 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as Administrative Agent.
With respect to the Loans made by them and their LC Exposure
hereunder, the Agents in their individual capacity and not as Agents shall have
the same rights and powers as any other Lender and may exercise the same as
though they were not Agents, and the Agents and their Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
the Borrower or any of its Subsidiaries or other Affiliate thereof as if they
were not Agents.
Each Lender and Issuing Bank agrees (i) to reimburse the
Administrative Agent in the amount of its pro rata share (based on its Standby
Commitment hereunder or, if the Standby Commitments hereunder have been
terminated, based on its outstanding Loans (and participations therein) and LC
Exposure
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47
hereunder) of any reasonable, out-of-pocket expenses incurred for the
benefit of the Lenders or the Issuing Banks by the Administrative Agent,
including reasonable counsel fees and compensation of agents and employees paid
for services rendered on behalf of the Lenders or the Issuing Banks, which
shall not have been reimbursed by the Borrower and (ii) to indemnify and hold
harmless the Administrative Agent and any of its directors, officers, employees
or agents in the amount of such pro rata share, from and against any and all
liabilities, taxes, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against it in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or any other Loan Document or any action taken or omitted by it under
this Agreement or any other Loan Document, to the extent the same shall not
have been reimbursed by the Borrower; PROVIDED that no Lender or Issuing Bank
shall be liable to the Administrative Agent for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the gross negligence or
wilful misconduct of the Administrative Agent or any of its directors,
officers, employees or agents.
Each Lender and Issuing Bank acknowledges that it has, independently
and without reliance upon the Agents or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender and Issuing
Bank also acknowledges that it will, independently and without reliance upon
any Agent or any other Lender and based on such documents and information as it
shall from time to time deem appropriate, continue to make its own decisions in
taking or not taking action under or based upon this Agreement or any other
Loan Document, any related agreement or any document furnished hereunder or
thereunder.
None of the Co-Agents shall have any duties or responsibilities
hereunder in its capacity as a Co-Agent.
ARTICLE VIII. MISCELLANEOUS
SECTION 8.01. NOTICES. Notices and other communications provided for
herein shall be in writing (or, where permitted to be made by telephone, shall
be confirmed promptly in writing) and shall be delivered by hand or overnight
courier service, mailed or sent by telecopier as follows:
(a) if to the Borrower, to it at Westinghouse Building, 11
Stanwix Street, Pittsburgh, Pennsylvania 15222, Attention of Executive
Vice President, Finance and Chief Financial Officer (Telecopy No.
(412) 642-5641);
(b) if to the Administrative Agent, to it at 270 Park Avenue,
New York, New York 10017, Attention of James Treger (Telecopy No.
(212) 270-7138), and with a copy to Chemical Bank Agency Services
Corporation, Grand Central Tower, 140 East 45th Street, New York, New
York 10017, Attention of Barbara Clemens (Telecopy No. (212)
622-0002);
(c) if to any Issuing Bank, to it at the address for notices
specified in the applicable Issuing Bank Agreement;
(d) if to a Lender or Co-Agent, to it at its address (or
telecopy number) set forth in Schedule 2.01 or in the Assignment and
Acceptance pursuant to which such Lender shall have become a party
hereto; and
(e) if to a Designated Bidder, to it at its address (or
telecopy number) set forth in the Administrative Questionnaire
delivered by such Designated Bidder.
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48
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service, sent by
telecopy or, if permitted by the terms hereof and if promptly confirmed in
writing, by telephone, or on the date five Business Days after dispatch by
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 8.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 8.01.
SECTION 8.02. SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the making by the
Lenders of the Loans, regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any Fee or any other amount
payable under this Agreement, any other Loan Document or any Letter of Credit
is outstanding and unpaid and so long as the Commitments have not been
terminated.
SECTION 8.03. BINDING EFFECT. This Agreement shall become effective
when it shall have been executed by the Borrower and the Administrative Agent
and when the Administrative Agent shall have received copies hereof which, when
taken together, bear the signatures of each Lender and thereafter shall be
binding upon and inure to the benefit of the Borrower, the Administrative Agent
and each Lender and their respective successors and assigns, except that the
Borrower shall not have the right (other than through transactions referred to
in and permitted by Section 5.05(C)) to assign its rights or obligations
hereunder or any interest herein without the prior consent of all the Lenders.
SECTION 8.04. SUCCESSORS AND ASSIGNS. (a) Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the Borrower, the Administrative Agent, the
Co-Agents or the Lenders that are contained in this Agreement shall bind and
inure to the benefit of their respective successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion
of its interests, rights and obligations under this Agreement (including all or
a portion of its Standby Commitment, Swingline Commitment and the Loans at the
time owing to it); PROVIDED, HOWEVER, that (i) except in the case of an
assignment to a Lender or an affiliate of such Lender (other than if at the
time of such assignment, such Lender or affiliate would be entitled to require
the Borrower to pay greater amounts under Section 2.20(a) than if no such
assignment had occurred, in which case such assignment shall be subject to the
consent requirement of this clause (i)), the Borrower, the Administrative
Agent, each Swingline Lender and each Issuing Bank must give their prior
written consent to such assignment (which consent shall not be unreasonably
withheld), (ii) after giving effect to any such assignment and to all
assignments under the Facility A Credit Agreement to be made on such date, the
Applicable Percentage of each assigning Lender and assignee Lender shall be
equal to the Applicable Percentage (as defined in the Facility A Credit
Agreement) of such assigning Lender and assignee Lender, respectively, (iii)
other than in the case of an assignment to a Lender or an affiliate of such
Lender, the amount of the Commitments of the assigning Lender subject to each
such assignment, when added to the amount of the Commitments (as defined in the
Facility A Credit Agreement) assigned on such date by such assigning Lender
pursuant to the Facility A Credit Agreement, (determined in each case as of the
date the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $25,000,000, (iv) the
assignor and assignee shall execute and deliver to the Administrative Agent an
Assignment and Acceptance, together with a processing and recordation fee of
$3,500 and (v) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon acceptance and
recording pursuant to paragraph (e) of this Section 8.04, from and after the
effective date specified in each
<PAGE> 53
49
Assignment and Acceptance, which effective date shall be at least five Business
Days after the execution thereof (or any lesser period to which the
Administrative Agent and the Borrower may agree), (A) the assignee thereunder
shall be a party hereto and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender under
this Agreement and (B) the assigning Lender thereunder shall, to the extent of
the interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto (but shall continue to be entitled to the benefits of Sections
2.13, 2.15, 2.20 and 8.05, as well as to any Fees accrued for its account
hereunder and not yet paid)). Notwithstanding the foregoing, any Lender
assigning its rights and obligations under this Agreement may retain any
Competitive Loans made by it outstanding at such time, and in such case shall
retain its rights hereunder in respect of any Loans so retained until such
Loans have been repaid in full in accordance with this Agreement.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim and
that its Commitment, and the outstanding balances of its Standby Loans,
Competitive Loans and Swingline Loans, if any, in each case without giving
effect to assignments thereof which have not become effective, are as set forth
in such Assignment and Acceptance, (ii) except as set forth in (i) above, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or any of its Subsidiaries or
the performance or observance by the Borrower or any of its Subsidiaries of any
of its obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
Assignment and Acceptance; (iv) such assignee confirms that it has received a
copy of this Agreement, together with copies of the most recent financial state
ments delivered pursuant to Sections 3.02 and 5.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (v) such assignee will
independently and without reliance upon the Administrative Agent, the
Co-Agents, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement; (vi) such assignee appoints and authorizes the Administrative Agent
to take such action as agent on its behalf and to exercise such powers under
this Agreement as are delegated to the Administrative Agent by the terms
hereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(d) The Administrative Agent, acting for this purpose as agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy
of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "REGISTER"). The entries in the Register shall be
conclusive in the absence of manifest error and the Borrower, the
Administrative Agent and the Lenders may treat each person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement. The Register shall be available for inspection
by the Borrower and any Lender, at any reasonable time and from time to time
upon reasonable prior notice.
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50
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, an Administrative
Questionnaire completed in respect of the assignee (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) above and, if required, the written consent of the Borrower,
the Administrative Agent, each Swingline Lender and each Issuing Bank to such
assignment, the Administrative Agent shall (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.
(f) Each Lender may without the consent of the Borrower or the Agents
sell participations to one or more banks or other financial institutions in all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitments and the Loans owing to it); PROVIDED, HOWEVER,
that (i) such Lender's obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto
for the performance of such obligations, (iii) the participating banks or other
entities shall be entitled to the benefit of the cost protection provisions
contained in Sections 2.13, 2.15 and 2.20 to the same extent as if they were
Lenders (provided that additional amounts payable to any Lender pursuant to
Section 2.20 shall be determined as if such Lender had not sold any such
participations) and (iv) the Borrower, the Agents and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrower relating to
the Loans and to approve any amendment, modification or waiver of any provision
of this Agreement (other than amendments, modifications or waivers decreasing
any fees payable hereunder or the amount of principal of or the rate at which
interest is payable on the Loans or LC Disbursements, extending any scheduled
principal payment date or date fixed for the payment of interest on the Loans
or LC Disbursements or LC Fees or changing or extending the Commitments).
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower; PROVIDED that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall execute a Confidentiality
Agreement whereby such assignee or participant shall agree (subject to the
exceptions set forth therein) to preserve the confidentiality of such
confidential information. It is understood that confidential information
relating to the Borrower would not ordinarily be provided in connection with
assignments or participations of Competitive Loans.
(h) Notwithstanding the limitations set forth in paragraph (b) above,
any Lender may at any time assign or pledge all or any portion of its rights
under this Agreement to a Federal Reserve Bank without the prior written
consent of the Borrower, the Administrative Agent, any Swingline Lender or any
Issuing Bank; PROVIDED that no such assignment shall release a Lender from any
of its obligations hereunder. In order to facilitate such an assignment to a
Federal Reserve Bank, the Borrower shall, at the request of the assigning
Lender, duly execute and deliver to the assigning Lender a registered
promissory note or notes evidencing the Loans made to the Borrower by the
assigning Lender hereunder.
(i) The Borrower shall not assign or delegate any of its rights or
duties hereunder (other than through transactions referred to in and permitted
by Section 5.05(C)) without the prior consent of all the Lenders.
SECTION 8.05. EXPENSES; INDEMNITY. (a) The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Administrative Agent in
connection with the preparation and negotiation of this Agreement and the other
Loan Documents or in connection with any amendments, modifications or waivers
of the provisions hereof or thereof (whether or not the transactions hereby
contemplated shall be
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51
consummated) or incurred by any Administrative Agent or any Lender or Issuing
Bank in connection with the enforcement or protection of the rights of the
Agents, the Lenders or the Issuing Banks under this Agreement and the other
Loan Documents or in connection with the Loans made or the Letters of Credit
issued hereunder, including the reasonable fees, charges and disbursements of
Cravath, Swaine & Moore, counsel for the Agents, and, in connection with any
such enforcement or protection, the reasonable fees, charges and disbursements
of any other counsel for any Agent, Lender or Issuing Bank.
(b) The Borrower agrees to indemnify each Agent, each Lender, each
Issuing Bank and each of their respective directors, officers, employees,
agents and controlling persons (each such person being called an "INDEMNITEE")
against, and to hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including reasonable counsel fees,
charges and disbursements, incurred by or asserted against any Indemnitee
arising out of, in any way connected with, or as a result of (i) the execution
or delivery of this Agreement and any amendments thereto, any Letter of Credit
or any other Loan Document or any agreement or instrument contemplated thereby,
the performance by the parties thereto of their respective obligations
thereunder or the consummation of the transactions contemplated thereby, (ii)
the use of the proceeds of the Loans or other extensions of credit hereunder or
(iii) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto; PROVIDED that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined by
a court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or wilful misconduct of such Indemnitee, (y)
result from any unexcused breach by such Indemnitee of its obligations
hereunder or (z) result from disputes among the Indemnitees not involving the
Borrower.
(c) The provisions of this Section 8.05 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term
or provision of this Agreement or any other Loan Document or any investigation
made by or on behalf of any Administrative Agent or Lender. All amounts due
under this Section 8.05 shall be payable on written demand therefor.
SECTION 8.06. RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
other Loan Documents held by such Lender which shall be due and payable. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 8.07. APPLICABLE LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE WITHIN SUCH STATE, WITHOUT
REGARD TO CONFLICTS OF LAW PROVISIONS AND PRINCIPLES OF SUCH STATE.
SECTION 8.08. WAIVERS; AMENDMENT. (a) No failure or delay of any
Agent, any Issuing Bank or any Lender in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Agents, the Issuing Banks and the Lenders hereunder and under the other
Loan Documents are cumulative and are not exclusive of any rights or remedies
which they
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would otherwise have. No waiver of any provision of this Agreement
or any other Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice or demand
on the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; PROVIDED, HOWEVER, that
no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or date for the payment of any interest on any Loan or LC
Disbursement or LC Fees, or waive or excuse any such payment or any part
thereof, or decrease the rate of interest on any Loan or the Facility Fee,
without the prior written consent of each Lender affected thereby, (ii) change
or extend the Commitment of any Lender or decrease the Fees of any Lender
without the prior written consent of such Lender, or (iii) amend or modify the
provisions of Section 2.16, the provisions of this Section, the definition of
"Required Lenders" or any provision hereof that requires the consent of each
Lender, without the prior written consent of each Lender; PROVIDED FURTHER that
no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent, the Swingline Lenders or the Issuing Banks
hereunder in such capacity without the prior written consent of the
Administrative Agent, the Swingline Lenders or the Issuing Banks, as the case
may be.
SECTION 8.09. INTEREST RATE LIMITATION. Notwithstanding anything
herein to the contrary, if at any time the applicable interest rate, together
with all fees and charges which are treated as interest under applicable law
(collectively the "CHARGES"), as provided for herein or in any other document
executed in connection herewith, or otherwise contracted for, charged,
received, taken or reserved by any Lender, shall exceed the maximum lawful rate
(the "MAXIMUM RATE") which may be contracted for, charged, taken, received or
reserved by such Lender in accordance with applicable law, the rate of interest
payable to such Lender hereunder, together with all Charges payable to such
Lender, shall be limited to the Maximum Rate.
SECTION 8.10. ENTIRE AGREEMENT. This Agreement and the other Loan
Documents constitute the entire contract between the parties relative to the
subject matter hereof. Any previous agreement among the parties with respect to
the subject matter hereof is superseded by this Agreement and the other Loan
Documents. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.
SECTION 8.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 8.11.
SECTION 8.12. SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby. The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
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SECTION 8.13. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which constitute an original but all of which when
taken together shall constitute but one contract, and shall become effective as
provided in Section 8.03.
SECTION 8.14. HEADINGS. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 8.15. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a) The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
any Lender may otherwise have to bring any action or proceeding relating to
this Agreement or the other Loan Documents against the Borrower or its
properties in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in any
New York State or Federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 8.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 8.16. ISSUING BANKS. Notwithstanding any other provision of
this Agreement to the contrary, each Issuing Bank, by its execution of the
applicable Issuing Bank Agreement, will become a party to this Agreement and
will thereafter have all the rights and obligations of an Issuing Bank
hereunder.
SECTION 8.17. DESIGNATED BIDDERS. Each Lender shall have the right
from time to time, with the consent of the Borrower and the Administrative
Agent (which consent shall not be unreasonably withheld) to designate one or
more Eligible Designees to submit Competitive Bids (in addition to any
Competitive Bids submitted by such Lender) pursuant to Competitive Bid Requests
made under Section 2.03. Upon (i) the execution by any such Eligible Designee
of a Designation Agreement and the acceptance thereof by the Borrower and the
Administrative Agent, (ii) the execution and delivery by such Eligible Designee
to the Borrower of a Confidentiality Agreement, and (iii) the delivery by such
Eligible Designee to the Administrative Agent of an Administrative
Questionnaire, such Eligible Designee shall become a Designated Bidder for
purposes of this Agreement and shall have the right to submit Competitive Bids
and, in the event such Competitive Bids are accepted, to make Competitive
Loans. As to any Competitive Loan made by it, each Designated Bidder shall have
all the rights and be subject to all obligations a Lender making such Loan
would have had under this Agreement and otherwise (including all rights to
receive information required to be provided by the Borrower hereunder);
PROVIDED that (i) all voting and consensual rights under this Agreement in
respect of such Competitive Loan shall be exercised solely by the Designating
Lender, and (ii) no Designated Bidder shall be entitled to recover a greater
<PAGE> 58
54
amount under Section 2.13 or 2.20 than the Designating Lender would have been
entitled to recover had such Loan been made by it. In the event the Commitment
of any Designating Lender shall be terminated and its outstanding Loans
assigned or prepaid pursuant to Section 2.21 or otherwise, all Designated
Bidders designated by such Designating Lender shall cease to be Designated
Bidders (but shall retain their rights hereunder with respect to Competitive
Loans at the time outstanding).
SECTION 8.18. CONFIDENTIALITY. (a) Each Lender agrees to keep
confidential and not to disclose (and to cause its officers, directors,
employees, agents and representatives to keep confidential and not to disclose)
and, at the request of the Borrower (except as provided below or if such Lender
is required to retain any Information (as defined below) pursuant to customary
internal or banking practices, bank regulations or applicable law), promptly to
return to the Borrower or destroy the Information and all copies thereof,
extracts therefrom and analyses or other materials based thereon, except that
such Lender shall be permitted to disclose Information (i) to such of its
officers, directors, employees, agents, affiliates and representatives as need
to know such Information in connection with such Lender's participation in this
Agreement, each of whom shall be informed by such Lender of the confidential
nature of the Information and shall agree to be bound by the terms of this
Section 8.18; (ii) to the extent required by applicable laws and regulations or
by any subpoena or similar legal process or requested by any governmental
authority or agency having jurisdiction over such Lender; provided, however,
that prior to such disclosure a written opinion of counsel to such Lender shall
be provided to the Borrower to such effect (except that no opinion will be
required for disclosure to bank regulators or examiners in accordance with
customary banking practices or if the provision of such opinion would violate
applicable law); (iii) to the extent such Information (A) becomes publicly
available other that as a result of a breach of this Agreement, (B) becomes
available to such Lender on a non-confidential basis from a source other than a
party to this Agreement or any other party known to such Lender to be bound by
an agreement containing a provision similar to this Section 8.18 or (C) was
available to such Lender on a non-confidential basis prior to its disclosure to
such Lender by a party to this Agreement or any other party known to such
Lender to be bound by an agreement containing a provision similar to this
Section 8.18; (iv) as permitted by Section 8.04(g); or (v) to the extent the
Borrower shall have consented to such disclosure in writing. As used in this
Section 8.18, "INFORMATION" shall mean any materials, documents or information
furnished by or on behalf of the Borrower in connection with this Agreement
designated by or on behalf of the Borrower as confidential.
(b) Each Lender (i) agrees that, except to the extent the conditions
referred to in subclauses (A), (B) or (C) of clause (iii) of paragraph (a)
above have been met and as provided in paragraph (c) below, (a) it will use the
Information only in connection with its participation in this Agreement and (B)
it will not use the Information in connection with any other matter or in a
manner prohibited by any law, including, without limitation, the securities
laws of the United States and (ii) understands that breach of this Section 8.18
might seriously prejudice the interest of the Borrower and that the Borrower is
entitled to equitable relief, including an injunction, in the event of such
breach.
(c) Notwithstanding anything to the contrary contained in this Section
8.18, each Lender shall be entitled to retain all Information for so long as it
remains a Lender to use solely for the purposes of servicing the credit and
protecting its rights with respect hereto.
SECTION 8.19. TERMINATION OF EXISTING CREDIT AGREEMENT. Each Lender
that is a party to the Existing Credit Agreement hereby waives the three-day
notice requirement to terminate the commitments under the Existing Credit
Agreement and consents to the delivery of such notice at the closing of this
Agreement.
<PAGE> 59
55
IN WITNESS WHEREOF, the Borrower, the Agents and the Lenders have
caused this Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.
WESTINGHOUSE ELECTRIC CORPORATION,
by
---------------------------------
Name:
Title:
CHEMICAL BANK, individually and
as Administrative Agent,
by
-------------------------------
Name:
Title:
<PAGE> 60
ABN AMRO BANK N.V., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 61
BANK OF MONTREAL, individually and as
Co-Agent,
by
------------------------
Name:
Title:
<PAGE> 62
BANK OF NEW YORK, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 63
THE BANK OF NOVA SCOTIA, individually and
as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 64
BARCLAYS BANK PLC, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 65
CITIBANK, N.A., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 66
CONTINENTAL BANK, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 67
CREDIT LYONNAIS NEW YORK BRANCH,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 68
CREDIT SUISSE, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 69
THE DAI-ICHI KANGYO BANK, LTD.,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 70
DEUTSCHE BANK AG NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
by ___________________________________
Name:
Title:
<PAGE> 71
THE FIRST NATIONAL BANK OF CHICAGO,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 72
THE FUJI BANK, LIMITED, NEW YORK
BRANCH, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 73
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, NEW YORK BRANCH, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 74
LTCB TRUST COMPANY, individually and as
Co-Agent
by ___________________________________
Name:
Title:
<PAGE> 75
MELLON, BANK, N.A., individually and as Co-
Agent,
by ___________________________________
Name:
Title:
<PAGE> 76
THE MITSUBISHI BANK, LIMITED--NEW
YORK BRANCH, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 77
THE MITSUBISHI TRUST AND BANKING
CORPORATION, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 78
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 79
NATIONSBANK N.C., N.A., individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 80
PNC BANK, NATIONAL ASSOCIATION,
individually and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 81
SANWA BANK LIMITED, individually and as
Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 82
SOCIETE GENERALE, individually and as Co-
Agent,
by ___________________________________
Name:
Title:
<PAGE> 83
THE SUMITOMO BANK, LIMITED, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 84
THE TORONTO-DOMINION BANK, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 85
UNION BANK OF SWITZERLAND, individually
and as Co-Agent,
by ___________________________________
Name:
Title:
<PAGE> 86
BANKERS TRUST COMPANY,
by ___________________________________
Name:
Title:
<PAGE> 87
ROYAL BANK OF CANADA,
by ___________________________________
Name:
Title:
<PAGE> 88
SHAWMUT BANK CONNECTICUT, N.A.,
by ___________________________________
Name:
Title:
<PAGE> 89
BANQUE PARIBAS,
by ___________________________________
Name:
Title:
<PAGE> 90
THE TOKAI BANK, LIMITED--NEW YORK
BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 91
ARAB BANKING CORPORATION,
by ___________________________________
Name:
Title:
<PAGE> 92
BANK BRUSSELS LAMBERT NEW YORK
BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 93
BANK OF HAWAII,
by ___________________________________
Name:
Title:
<PAGE> 94
THE BANK OF TOKYO TRUST COMPANY,
by ___________________________________
Name:
Title:
<PAGE> 95
FIRST INTERSTATE BANK OF CALIFORNIA,
by ___________________________________
Name:
Title:
<PAGE> 96
THE FIRST NATIONAL BANK OF
MARYLAND,
by ___________________________________
Name:
Title:
<PAGE> 97
ISTITUTO BANCARIO SAN PAOLO DI
TORINO SPA,
by ___________________________________
Name:
Title:
<PAGE> 98
MITSUI TRUST BANK (U.S.A.),
by ___________________________________
Name:
Title:
<PAGE> 99
THE SUMITOMO TRUST & BANKING CO.
LTD., NEW YORK BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 100
THE YASUDA TRUST AND BANKING
COMPANY LIMITED--NEW YORK BRANCH,
by ___________________________________
Name:
Title:
<PAGE> 101
EXHIBIT A-1
FORM OF COMPETITIVE BID REQUEST
Chemical Bank, as Administrative Agent for
the Lenders referred to below,
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the
"Borrower"), refers to the Three-year Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as it may hereafter be amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Borrower, the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
such terms in the Credit Agreement. The Borrower hereby gives you notice
pursuant to Section 2.03(a) of the Credit Agreement that it requests a
Competitive Borrowing under the Credit Agreement, and in that connection sets
forth below the terms on which such Competitive Borrowing is requested to be
made:
(A) Date of Competitive Borrowing
(which is a Business Day)
(B) Principal Amount of
Competitive Borrowing 1/
(C) Interest rate basis 2/
(D) Interest Period and the last
- ---------------------
1/ Not less that $25,000,000 (and in integral multiples of
$1,000,000) or greater than the Total Commitment then available.
2/ Eurodollar Loan or Fixed Rate Loan.
<PAGE> 102
2
day thereof 3/
Upon acceptance of any or all of the Loans offered by the
Lenders in response to this request, the Borrower shall be deemed to have
represented and warranted that the conditions to lending specified in Section
4.02(b) and (c) of the Credit Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by_______________________
Title: [Responsible
Officer]
- ---------------------
3/ Which shall be subject to the definition of "Interest
Period" and end not later than the Maturity Date.
<PAGE> 103
EXHIBIT A-2
FORM OF NOTICE OF COMPETITIVE BID REQUEST
[Name of Lender]
[Address]
New York, New York
Attention:
[Date]
Dear Sirs:
Reference is made to the Three-year Competitive Advance and
Revolving Credit Facility Agreement dated as of August 5, 1994 (as it may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Westinghouse Electric Corporation (the
"Borrower"), the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement. The Borrower made a Competitive Bid Request on ,
19 , pursuant to Section 2.03(a) of the Credit Agreement, and in that
connection you are invited to submit a Competitive Bid by [Date]/[Time]. 1/
Your Competitive Bid must comply with Section 2.03(b) of the Credit Agreement
and the terms set forth below on which the Competitive Bid Request was made:
(A) Date of Competitive Borrowing
(B) Principal amount of
Competitive Borrowing
(C) Interest rate basis
1/ The Competitive Bid must be received by the Agent (i) in the case of
Eurodollar Loans, not later than 9:30 a.m., New York City time, three Business
Days before a proposed Competitive Borrowing, and (ii) in the case of Fixed
Rate Loans, not later then 9:30 a.m., New York City time, on the day of a
proposed Competitive Borrowing.
<PAGE> 104
2
(D) Interest Period and the last
day thereof
Very truly yours,
CHEMICAL BANK, as
Administrative Agent,
By________________________
Title:
<PAGE> 105
EXHIBIT A-3
FORM OF COMPETITIVE BID
Chemical Bank, as Administrative Agent for
the Lenders referred to below,
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, [Name of Lender], refers to the Three-year
Competitive Advance and Revolving Credit Facility Agreement dated as of August
5, 1994 (as it may hereafter be amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Westinghouse
Electric Corporation (the "Borrower"), the Lenders party thereto, the Co-Agents
named therein and Chemical Bank, as Administrative Agent. Capitalized terms
used herein and not otherwise defined herein shall have the meanings assigned
to such terms in the Credit Agreement. The undersigned hereby makes a
Competitive Bid pursuant to Section 2.03(b) of the Credit Agreement, in
response to the Competitive Bid Request made by the Borrower on ,
19 , and in that connection sets forth below the terms on which such
Competitive Bid is made:
(A) Principal Amount 1/
(B) Competitive Bid Rate 2/
(C) Interest Period and last
day thereof
1/ Not less than $5,000,000 or greater than the requested
Competitive Borrowing and in integral multiples of $1,000,000. Multiple bids
will be accepted by the Agent.
2/ i.e. , LIBO Rate + or - %, in the case of Eurodollar
Loans or %, in the case of Fixed Rate Loans.
<PAGE> 106
2
The undersigned hereby confirms that it is prepared, subject
to the conditions set forth in the Credit Agreement, to extend credit to the
Borrower on the requested date of the Competitive Bid Borrowing upon acceptance
by the Borrower of this bid in accordance with Section 2.03(d) of the Credit
Agreement.
Very truly yours,
[NAME OF LENDER],
by______________________
Title:
<PAGE> 107
EXHIBIT A-4
FORM OF COMPETITIVE BID ACCEPT/REJECT LETTER
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention: [ ]
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the
"Borrower"), refers to the Three-year Competitive Advance and Revolving Credit
Facility dated as of August 5, 1994 (as it may hereafter be amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent for the Lenders.
In accordance with Section 2.03(c) of the Credit Agreement, we
have received a summary of bids in connection with our Competitive Bid Request
dated _________________ and in accordance with Section 2.03(d) of the Credit
Agreement, we hereby accept the following bids for maturity on [date]:
Principal Amount Fixed Rate/Margin Lender
- ---------------- ----------------- ------
$ [%] [+/-. %]
$
We hereby reject the following bids:
Principal Amount Fixed Rate/Margin Lender
- ---------------- ----------------- ------
$ [%] [+/-. %]
$
<PAGE> 108
2
The $ should be deposited in Chemical Bank account number [ ] on
[date].
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by______________________
Name:
Title:
<PAGE> 109
EXHIBIT A-5
FORM OF STANDBY BORROWING REQUEST
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the
"Borrower"), refers to the Three-year Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as it may hereafter be amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Borrower, the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
such terms in the Credit Agreement. The Borrower hereby gives you notice
pursuant to Section 2.04 of the Credit Agreement that it requests a Standby
Borrowing under the Credit Agreement, and in that connection sets forth below
the terms on which such Standby Borrowing is requested to be made:
(A) Date of Standby Borrowing
(which is a Business Day)
(B) Principal Amount of
Standby Borrowing 1/
(C) Interest rate basis 2/
- -------------------
1/ Not less than $50,000,000 in the case of Eurodollar Loans or CD
Loans and $25,000,000 in the case of ABR Loans (and in integral multiples of
$5,000,000) or greater than the Total Commitment then available.
2/ Eurodollar Loan, CD Loan or ABR Loan.
<PAGE> 110
2
(D) Interest Period and the last
day thereof 3/
Upon acceptance of any or all of the Loans made by the Lenders
in response to this request, the Borrower shall be deemed to have represented
and warranted that the conditions to lending specified in Section 4.02(b) and
(c) of the Credit Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by______________________
Title:
- -----------------
3/ Which shall be subject to the definition of "Interest Period" and
end not later than the Maturity Date.
<PAGE> 111
[LOGO]
Chemical Bank
140 East 46th Street
New York, NY 10017-3762
212-622-0001
Fax 212/622-0002
Telex 353006 ABSC NYK
WESTINGHOUSE ELECTRIC CORPORATION
ADMINISTRATIVE QUESTIONNAIRE
Please accurately complete the following information and return via FAX to the
attention of Barbara Clemens at Chemical Bank as soon as possible.
FAX Number: 212-622-0854
LEGAL NAME TO APPEAR IN DOCUMENTATION:
- --------------------------------------
- ------------------------------------------------------------------------------
GENERAL INFORMATION - DOMESTIC LENDING OFFICE:
- ----------------------------------------------
Institution Name:
-----------------------------------------------------------
Street Address:
-----------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
GENERAL INFORMATION - EURODOLLAR LENDING OFFICE:
- ------------------------------------------------
Institution Name:
-----------------------------------------------------------
Street Address:
-----------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
CONTRACTS/NOTIFICATION METHODS:
- -------------------------------
CREDIT CONTACTS:
Primary Contact:
------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
Backup Contact:
------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
<PAGE> 112
TAX WITHHOLDING:
- ----------------
Non Resident Alien _______ Y* _______ N
* Form 4224 Enclosed
Tax ID Number
CONTACTS/NOTIFICATION METHODS:
- ------------------------------
ADMINISTRATIVE CONTACTS - BORROWINGS, PAYDOWNS, INTEREST, FEES, ETC.
Contact:
---------------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
BID LOAN NOTIFICATION:
- ----------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
Phone Number:
---------------------------------------------------------------
FAX Number:
------------------------------------------------------------
PAYMENT INSTRUCTIONS:
- ---------------------
Name of Bank where funds are to be transferred:
--------------------------------------------------------------------------
Routing Transit/ABA Number of Bank where funds are to be transferred:
--------------------------------------------------------------------------
Name of Account, if applicable:
--------------------------------------------------------------------------
Account Number:
-------------------------------------------------------------
Additional Information:
-----------------------------------------------------
- ------------------------------------------------------------------------------
MAILINGS:
- ---------
Please specify who should receive financial information:
Name:
-----------------------------------------------------------------------
Street Address:
------------------------------------------------------------
City, State, Zip Code:
------------------------------------------------------
<PAGE> 113
It is very important that all of the above information is accurately filled in
and returned promptly. If there is someone other than yourself who should
receive this questionnaire, please notify us of their name and FAX number and
we will fax them a copy of the questionnaire. If you have any questions,
please call at 212-622-0484.
<PAGE> 114
EXHIBIT C
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Three-year Competitive Advance and
Revolving Credit Facility Agreement dated as of August 5, 1994 (the "Credit
Agreement"), among Westinghouse Electric Corporation, a Pennsylvania
corporation, the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as administrative agent for the Lenders (in such capacity, the
"Administrative Agent"). Terms defined in the Credit Agreement are used herein
with the same meanings.
The Assignor hereby sells and assigns, without recourse, to
the Assignee, and the Assignee hereby purchases and assumes, without recourse,
from the Assignor, effective as of the Effective Date set forth on the reverse
hereof, the interests set forth on the reverse hereof (the "Assigned Interest")
in the Assignor's rights and obligations under the Credit Agreement, including,
without limitation, the interests set forth on the reverse hereof in the
Commitments of the Assignor on the Effective Date [and Competitive Loans],
Swingline Loans and Standby Loans owing to the Assignor which are outstanding
on the Effective Date, together with unpaid interest accrued on the assigned
Loans
<PAGE> 115
2
to the Effective Date and the amount, if any, set forth on the reverse
hereof of the Fees accrued to the Effective Date for the account of the
Assignor. Each of the Assignor and the Assignee hereby makes and agrees to be
bound by all the representations, warranties and agreements set forth in
Section 8.04(c) of the Credit Agreement, a copy of which has been received by
each such party. From and after the Effective Date (i) the Assignee shall be a
party to and be bound by the provisions of the Credit Agreement and, to the
extent of the interests assigned by this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and under the other Loan
Documents and (ii) the Assignor shall, to the extent of the interests assigned
by this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Credit Agreement.
This Assignment and Acceptance is being delivered to the
Administrative Agent together with (i) if the Assignee is organized under the
laws of a jurisdiction outside the United States, the forms specified in
Section 2.20(f) of the Credit Agreement, duly completed and executed by such
Assignee, (ii) if the Assignee is not already a Lender under the Credit
Agreement, an Administrative Questionnaire in the form of Exhibit B to the
<PAGE> 116
3
Credit Agreement and (iii) a processing and recordation fee of $3,500.
This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made within such State, without regard to conflicts of law
provisions and principles of such State.
<PAGE> 117
4
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
(may not be fewer than 5 Business
Days after the Date of Assignment):
<TABLE>
<CAPTION>
Percentage
Assigned of
Facility/Commit-
ment (set forth,
to at least 8
Principal Amount decimals, as a
Assigned (and percentage of
identifying the Facility and
information as the aggregate
to individual Commitments of
Competitive all Lenders
Facility Loans) thereunder
- -------- -------------- ---------------
<S> <C> <C>
Standby
Commitment
Assigned $ %
Standby Loans:
Competitive Loans:
Swingline Commitment
Assigned:
</TABLE>
<PAGE> 118
5
Swingline Loans:
Fee Assigned (if
any):
The terms set forth above and on the
reverse side hereof are hereby agreed to:
Accepted */
_______________ ,as Assignor WESTINGHOUSE ELECTRIC
CORPORATION
By:_________________________ By:__________________________
Name: Name:
Title: Title:
Acknowledged */
______________, as Assignee CHEMICAL BANK, as administrative agent
By:_________________________ By:__________________________
Name: Name:
Title: Title:
- ----------------
*/ To be completed only if consents are required under Section 8.04(b).
<PAGE> 119
EXHIBIT D
[FORM OF]
CONFIDENTIALITY AGREEMENT
____________, 199_
Westinghouse Electric Corporation
Westinghouse Building
[Gateway Center]
Pittsburgh, Pennsylvania 15222
Attention of [Executive Vice President,
Finance and Chief Financial Officer]
Ladies and Gentlemen:
Reference is made to the Three-year Competitive Advance and
Revolving Credit Facility Agreement dated as of August 5, 1994 (as the same may
be amended, restated, supplemented or otherwise modified from time to time, the
"Agreement"), among Westinghouse Electric Corporation, a Pennsylvania
corporation (the "Borrower"), the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent. Capitalized terms used but
not defined herein have the meanings assigned to them in the Agreement.
In connection with the proposed assignment or participation
of certain interests in the Facility to us pursuant to Section 8.04 of the
Agreement, we may receive information furnished by or on behalf of the Borrower
and designated by or on behalf of the Borrower as confidential (the
"Information").
We understand that improper use or disclosure of the
Information might violate applicable Federal and state securities laws
(including Rule 10b-5 under the Securities Exchange Act of 1934, as amended)
and seriously prejudice the interests of the Borrower and that the Borrower is
entitled to rely on the promises made herein and to equitable relief, including
an injunction, in the event of our breach. Accordingly, we agree to keep
confidential and not to disclose (and to cause our officers, directors,
employees, agents, affiliates and representatives to keep confidential and not
to disclose) and, at your request (except as provided below), promptly to
return to you or
<PAGE> 120
2
destroy the Information and all copies thereof, extracts
therefrom and analyses or other materials based thereon, except that we shall
be permitted to disclose Information and shall agree to be bound by the terms
of this Confidentiality Agreement; (i) to such of our officers, directors,
employees, agents and representatives as need to know such Information in
connection with the proposed assignment or participation referred to above,
each of whom shall be informed by us of the confidential nature of the
Information and shall agree to be bound by the terms of this Confidentiality
Agreement; (ii) to the extent required by applicable laws and regulations or by
any subpoena or similar legal process or requested by any governmental
authority or agency having jurisdiction over us; provided , however , that
prior to such disclosure a written opinion of counsel to us shall be provided
to you to such effect (except that no opinion will be required for disclosure
to bank regulators or examiners in accordance with customary banking practices
or if the provision of such opinion would violate applicable law); (iii) to the
extent such Information (A) becomes publicly available other than as a result
of a breach of the Agreement or this Confidentiality Agreement, (B) becomes
available to us on a non-confidential basis from a source other than a party to
the Agreement or any other party bound by an agreement similar to this
Confidentiality Agreement or (C) was available to us on a non-confidential
basis prior to its disclosure to us by a party to the Agreement or any other
party bound by an agreement similar to this Confidentiality Agreement; or (iv)
to the extent the Borrower shall have consented to such disclosure in writing.
We further agree that, except to the extent the conditions
referred to in subclause (A), (B) or (C) of clause (iii) above have been met
and as provided in the last paragraph of this letter, (a) we will use the
Information only in connection with our possible participation in the Facility
and (b) we will not use the Information in connection with any other matter or
in a manner prohibited by any law, including, without limitation, the
securities laws of the United States.
Notwithstanding anything to the contrary contained above, if
we shall purchase an assignment of or a participation in the rights of any
Lender under the Agreement, we shall be entitled to retain all Information to
use solely for the purposes of servicing our credit and protecting our rights
with regard thereto.
<PAGE> 121
3
Name of Recipient:
By:
Title:
Institution:
Date:
<PAGE> 122
EXHIBIT E
[FORM OF]
DESIGNATION AGREEMENT
__________, 199_
Reference is made to the Three-year Competitive Advance and
Revolving Credit Facility Agreement dated as of August 5, 1994 (as the same may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Westinghouse Electric Corporation (the
"Borrower"), the Lenders party thereto, the Co-Agents named therein and
Chemical Bank, as Administrative Agent. Capitalized terms used but not defined
herein have the meanings assigned to such terms in the Credit Agreement.
1. The undersigned Lender (the "Designating Lender") hereby
designates the undersigned Eligible Designee (the "Designee") to have the
right, subject to Section 8.17 of the Credit Agreement, to submit Competitive
Bids pursuant to Competitive Bid Requests made under Section 2.03 of the Credit
Agreement, and the Designee hereby accepts such designation.
2. The Designating Lender makes no representation or warranty
and assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other instrument or document furnished
pursuant thereto or(ii) the financial condition of the Borrower or any of its
Subsidiaries or the performance or observance by the Borrower or any of its
Subsidiaries of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto.
3. The Designee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the most recent financial
statements referred to in Section 3.02 or delivered pursuant to Section 5.01
thereof and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Designation
Agreement; (ii) agrees that it will, independently and without reliance upon
the Administrative
<PAGE> 123
2
Agent, the Co-Agents, the Designating Lender or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement; (iii) confirms that it is an Eligible
Designee; (iv) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all the obligations which by the
terms of the Credit Agreement are required to be performed by it pursuant to
Section 8.17 thereof; and (vi) agrees that the Borrower shall be a third-party
beneficiary of this Agreement.
4. This Designation Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
The terms set forth above
are hereby agreed to: Accepted:
CHEMICAL BANK, as
Administrative Agent
as Designating Lender
By:________________ By:_______________________
Name: Name:
Title: Title:
WESTINGHOUSE ELECTRIC
CORPORATION
as Designee
By:________________ By:_______________________
Name: Name:
Title: Title:
<PAGE> 124
EXHIBIT F
[Form of Opinion of Louis J. Briskman, Esq.,
Senior Vice President and General Counsel
of Westinghouse Electric Corporation]
August [ ], 1994
Chemical Bank, as Administrative Agent,
and each of the Lenders and Co-Agents
party to the Credit Agreement referred to below
270 Park Avenue
New York, NY 10017
Gentlemen:
I am Senior Vice President and General Counsel of Westinghouse
Electric Corporation (the "Company") and in such capacity have represented the
Company in connection with the Three-year Competitive Advance and Revolving
Credit Facility Agreements dated as of August 5, 1994, among the Company, a
Pennsylvania corporation, the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent (the "Credit Agreement") .
This opinion is rendered to you pursuant to Section 4.01(a) of the Credit
Agreement. Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Credit Agreement.
In rendering the opinions expressed below, I have examined,
either personally or indirectly through lawyers who report to me or through
other counsel, the originals or conformed copies of such corporate records,
agreements and instruments of the Company and its Material Subsidiaries,
certificates of public officials and of officers of the Company and its
Material Subsidiaries, and such other documents and records as I have deemed
appropriate as a basis for the opinions hereinafter expressed.
Based upon the foregoing, and subject to the qualifications
stated herein, I am of the opinion that:
1. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the Commonwealth of
Pennsylvania and has the necessary corporate power to make and perform the
Credit Agreement and to borrow under each Credit Agreement. To my
<PAGE> 125
2
knowledge, each of the Company and its Material Subsidiaries is qualified to
do business in all jurisdictions where failure to so qualify would have a
material adverse effect on the consolidated financial condition of the Company
and its Consolidated Subsidiaries.
2. The making and performance and other extensions of credit
by the Company of the Credit Agreement and the borrowings thereunder have been
duly authorized by all necessary corporate action, and do not and will not
violate any provision of law or regulation or any order, writ, injunction or
decree of any court or Governmental Authority or any provision of the Company's
articles of incorporation or by-laws or, to my knowledge, result in the breach
of, or constitute a default or require any consent under, or result in the
creation of any Lien upon any of the revenues or assets of the Company or any
of its Material Subsidiaries pursuant to, any material agreement or instrument
to which the Company or any of its Material Subsidiaries is a party or by which
any of them is bound. The Credit Agreement has been duly executed and
delivered by the Company effective as of the date hereof.
3. If, contrary to the agreement of the parties, the Credit
Agreement was held to be governed by the laws of the Commonwealth of
Pennsylvania, without regard to the application of conflict or choice of law
provisions, each Credit Agreement, as applicable, would constitute the legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability, to
general principles of equity, including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether enforcement
is sought in a proceeding at law or in equity) and subject to the qualification
that I express no opinion as to Section 2.17 of each of the Credit Agreement
insofar as it provides that any Lender purchasing a participation from another
Lender pursuant thereto may exercise set-off or similar rights with respect to
such participation.
4. Except as disclosed in the Exchange Act Report or
otherwise disclosed in writing to the Lenders prior to the date hereof, as of
the date hereof there are no legal or arbitral proceedings, or any proceedings
by or before any Governmental Authority, now pending or, to the best of my
<PAGE> 126
3
knowledge, threatened against the Company or any of its Material Subsidiaries
which has resulted or would result, if determined adversely to the Company or
such Material Subsidiary, in a material adverse effect on the consolidated
financial condition of the Company and its Consolidated Subsidiaries.
5. No authorizations, approvals or consents of, and no
filings or registrations with, any Governmental Authority are necessary for the
execution, delivery or performance by the Company of the Credit Agreement.
6. The Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
7. The Company is not subject to regulation as a "holding
company," subject to regulation as an "affiliate" of a "holding company," or
subject to regulation as a "subsidiary company" of a "holding company," under
the Public Utility Holding Company Act of 1935, as amended.
The foregoing opinions are subject to the following
qualifications:
1. I express no opinion as to any matter involving any choice
of law or conflict of laws or as to the effect on matters covered by this
opinion of the laws of any jurisdiction other than the Commonwealth of
Pennsylvania and the United States of America.
2. My opinions as to enforceability are based on the
assumption that each of the Credit Agreement has been duly and validly executed
and delivered by each of the other required parties thereto, and that the
Credit Agreement is the legal and valid agreement of and binding on each of
said parties in accordance with its terms.
3. These opinions are based on current law and facts and
circumstances. I am not assuming an obligation to revise or supplement this
letter should applicable law or the existing facts and circumstances change.
I am a member of the bar of the Commonwealth of Pennsylvania.
In rendering this opinion, I do not hold myself out to be an expert on or
personally familiar with or qualified to express a legal opinion on matters
with respect to the laws of any jurisdiction other than the laws of the
<PAGE> 127
4
Commonwealth of Pennsylvania and the United States of America, and my opinion
is limited to the laws of Pennsylvania and the United States of America.
This opinion is rendered solely for your benefit in connection
with the transaction described above. This opinion is not to be used or relied
upon by any other party and may not be disclosed, quoted in whole or in part,
or referred to, nor is it to be filed with any governmental agency or other
person, without my prior written consent except as required by law.
Very truly yours,
Louis J. Briskman
<PAGE> 128
EXHIBIT G
FORM OF SWINGLINE BORROWING REQUEST
Chemical Bank, as Administrative Agent
for the Lenders referred to below
270 Park Avenue
New York, NY 10017
Attention:
[Date]
Dear Sirs:
The undersigned, Westinghouse Electric Corporation (the
"Borrower"), refers to the Three-year Competitive Advance and Revolving Credit
Facility Agreement dated as of August 5, 1994 (as it may hereafter be amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among the Borrower, the Lenders party thereto, the Co-Agents named
therein and Chemical Bank, as Administrative Agent. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
such terms in the Credit Agreement. The Borrower hereby gives you notice
pursuant to Section 2.22 of the Credit Agreement that it requests a Swingline
Borrowing under the Credit Agreement, and in that connection sets forth below
the terms on which such Swingline Borrowing is requested to be made:
(A) Date of Swingline Borrowing
(which is a Business Day)
(B) Principal Amount of
Swingline Borrowing 1 /
Upon acceptance of any or all of the Loans made by the Lenders
in response to this request, the Borrower shall be deemed to have represented
and warranted that the
1/ Not less than $5,000,000 or greater than the Swingline Commitments
then available.
<PAGE> 129
2
conditions to lending specified in Section 4.02(b) and (c) of the Credit
Agreement have been satisfied.
Very truly yours,
WESTINGHOUSE ELECTRIC
CORPORATION,
by
-----------------------
Title:
<PAGE> 1
<TABLE>
EXHIBIT (11) COMPUTATION OF PER SHARE EARNINGS
(unaudited)
<CAPTION>
Six Months Ended
June 30
1994 1993
---- ----
<S> <C> <C>
EQUIVALENT SHARES:
Average shares outstanding 353,488,409 348,075,771
Additional shares due to:
Stock options 3,583,638 3,401,715
Series C Preferred shares 15,926,267 --
----------- -----------
Total equivalent shares 372,998,314 351,477,486
=========== ===========
ADJUSTED EARNINGS (in millions):
Net income from Continuing
Operations $ 111 $ 143
Less: Series B preferred stock
dividends 25 25
----------- -----------
Adjusted net income from
Continuing Operations 86 118
Income from Discontinued
Operations - --
Cumulative effect of changes in
accounting principles - (56)
----------- ------------
Adjusted net income (loss) after
cumulative effect of changes
in accounting principles $ 86 $ 62
=========== ============
EARNINGS (LOSS) PER SHARE
From Continuing Operations $ 0.23 $ 0.34
From cumulative effect of
changes in accounting principles - $(0.16)
------------ ------------
Earnings (loss) per share $ 0.23 $ 0.18
============= ============
</TABLE>
<PAGE> 1
<TABLE>
EXHIBIT 12(a) COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(in millions) (unaudited)
<CAPTION>
Six Months Ended Year Ended
June 30 December 31
1994 1993 1993
----- ----- -----
<S> <C> <C> <C>
Income (loss) before income taxes
and minority interest $ 183 $ 234 $(236)
Less: Equity in income (loss) of
50 percent or less owned affiliates (1) (4) (7)
Add: Fixed charges excluding
capitalized interest 109 120 253
----- ----- -----
Earnings as adjusted $ 293 $ 358 $ 24
===== ===== =====
Fixed charges:
Interest expense $ 92 $ 105 $ 217
Rental expense 17 15 36
Capitalized interest - 1 3
----- ----- -----
Total fixed charges $ 109 $ 121 $ 256
===== ===== =====
Ratio of earnings to fixed charges 2.69x 2.96x (a)
===== ===== =====
<FN>
(a) Additional income before income taxes and minority interest of
$232 million would be necessary to attain a ratio of earnings to
fixed charges of 1.00x for the year ended December 31, 1993.
</TABLE>
<PAGE> 1
<TABLE>
EXHIBIT 12(b) COMPUTATION OF RATIO OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(in millions) (unaudited)
<CAPTION>
Six Months Ended Year Ended
June 30 December 31
1994 1993 1993
---- ---- ----
<S> <C> <C> <C>
Income (loss) before income taxes
and minority interest $183 $234 $(236)
Less: Equity in income (loss) of
50 percent or less owned affiliates (1) (4) (7)
Add: Fixed charges excluding
capitalized interest 169 160 325
---- ---- ----
Earnings as adjusted $353 $398 $ 96
==== ==== ====
Combined fixed charges and
preferred dividends:
Interest expense $ 92 $105 $217
Rental expense 17 15 36
Capitalized interest - 1 3
Pre-tax earnings required to cover
preferred dividend requirements (a) 60 40 72
---- ---- ----
Total combined fixed charges and
preferred dividends $169 $161 $328
==== ==== ====
Ratio of earnings to combined fixed
charges and preferred dividends 2.09x 2.47x (b)
===== ===== ====
<FN>
(a) Dividend requirement divided by 100% minus effective income tax rate.
(b) Additional income before income taxes and minority interest of
$232 million would be necessary to attain a ratio of earnings to
combined fixed charges and preferred dividends of 1.00x for the year
ended December 31, 1993.
</TABLE>
