EXHIBIT(b)(1)
As of November 13, 2000
Weyerhaeuser Company
33663 Weyerhaeuser Way South
Federal Way, Washington
Attention: Mr. William Stivers
Ladies and Gentlemen:
Reference is hereby made to that certain commitment letter dated as
of November 13, 2000 (the "Existing Commitment Letter") entered into by and
among you, Morgan Stanley Senior Funding, Inc., Chase Securities Inc. and The
Chase Manhattan Bank. This letter amends and restates the Existing Commitment
Letter in full. As of the date first above written, each reference to the
"Commitment Letter," shall mean and be a reference to the Existing Commitment
Letter, as amended and restated hereby.
You have advised Morgan Stanley Senior Funding, Inc. ("Morgan
Stanley"), Chase Securities Inc. ("CSI") and The Chase Manhattan Bank
("Chase") regarding your proposed acquisition (the "Acquisition") of a
publicly held Oregon corporation code-named "South" (the "Company"). In this
connection, you have requested that (a) each of Morgan Stanley and Chase
provide you with its financing commitment for 50% of the $5.4 billion of
Senior Bank Financing (as hereinafter defined) described in this letter and in
the summary of terms and conditions attached as Exhibit A (the "Summary of
Terms" and, together with this letter, this "Commitment Letter") and (b) each
of Morgan Stanley and CSI provide you with its best efforts undertaking to
arrange a syndicate (in such capacity, the "Lead Arrangers") of Lenders (as
defined under the section "Lenders" in the Summary of Terms) for the Senior
Bank Financing.
As we understand the transaction, Weyerhaeuser Company (the
"Borrower") has organized a single-purpose, wholly owned subsidiary (the
"Purchaser") that will offer to acquire through a tender offer (the "Tender
Offer") for $48 in cash per share all of the shares of the Company's
outstanding common stock (the "Company Stock"), but in any event not less than
sufficient shares of Company Stock to enable the Purchaser, voting without any
other shareholder of the Company, to approve a Merger of the Purchaser, the
Borrower or one of its wholly owned subsidiaries with the Company. As soon as
practicable after the closing of the Tender Offer, the Purchaser, the Borrower
or one of its wholly owned subsidiaries will consummate a merger (the
"Merger") with the Company. The Acquisition, the Tender Offer, the Merger, the
refinancing of certain existing debt of the Borrower and the Company and the
debt financings contemplated by the foregoing are collectively referred to as
the "Transaction".
We understand that the funding required to effect the Acquisition
shall be provided solely from the incurrence by the Borrower of the Senior
Bank Financing.
We further understand that the senior bank financing (the "Senior
Bank Financing") will be in the form of (i) a 364-day revolving credit
facility (the "364-Day Facility"), (ii) a 5-year revolving credit facility
(the "5-Year Facility") and (iii) a bridge
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revolving credit facility (the "Bridge Revolving Credit Facility", together
with the 364-Day Facility and the 5-Year Facility, the "Credit Facilities").
Each of Morgan Stanley and Chase commits to provide, severally and
not jointly, 50% of the Senior Bank Financing on the terms and conditions set
forth herein and in the Summary of Terms. Morgan Stanley and CSI shall act as
exclusive joint lead arrangers and as joint book runners, Morgan Stanley shall
act as syndication agent and Chase shall act as administrative agent for the
Senior Bank Financing. It is understood that the Lead Arrangers shall be
permitted to designate one or more Lenders as agents, managing agents or
co-agents, as the case may be, with respect to the Senior Bank Financing in
their sole discretion, and that no titles may be given, or compensation paid,
to Lenders without the Lead Arrangers' consent. Fees payable to the syndicate
shall be payable from the respective amounts payable to the Lead Arrangers and
any other co-arrangers as described in the fee letter (the "Fee Letter")
executed simultaneously herewith.
Each of the Lead Arrangers reserves the right, prior to or after
execution of the definitive credit documentation for the Senior Bank
Financing, to syndicate all or part of its commitment for the Senior Bank
Financing to one or more lending institutions that will become parties to such
definitive credit documentation pursuant to a syndication to be managed by the
Lead Arrangers, and the commitment of Morgan Stanley and Chase, respectively,
hereunder shall be reduced ratably as and when commitments are received from
the Lenders. The Lead Arrangers shall commence syndication efforts after the
execution of this letter by you at a time the Lead Arrangers determine to be
appropriate, and you agree actively to assist the Lead Arrangers in achieving
a syndication that is satisfactory to the Lead Arrangers and the Borrower.
Such syndication will be accomplished by a variety of means, including direct
contact during the syndication between senior management and advisors of the
Borrower and the proposed syndicate members. To assist the Lead Arrangers in
their syndication efforts, you hereby agree (a) to provide and cause your
advisors to provide the Lead Arrangers and the other syndicate members upon
request with all information reasonably deemed necessary by the Lead Arrangers
to complete syndication, including but not limited to information and
evaluations prepared by you and your advisors or on your behalf relating to
the transactions contemplated hereby, (b) to assist the Lead Arrangers upon
request in the preparation of an Information Memorandum to be used in
connection with the syndication of the Senior Bank Financing and (c) to make
available your senior officers and representatives, in each case from time to
time and to attend and make presentations regarding the business and prospects
of the Borrower at a meeting or meetings of lenders or prospective lenders. In
addition, you agree that no financing for the Borrower, you or any of your
respective subsidiaries or affiliates shall be syndicated, privately placed or
publicly offered to the extent that such financing would have an adverse
effect on the syndication of the Senior Bank Financing.
Please note that the terms and conditions of the Credit Facilities
are not limited to those set forth in this Commitment Letter. Those matters
that are not covered or made clear herein or in the attached Summary of Terms
are subject to mutual agreement of the parties. The terms and conditions of
this commitment may be modified only in writing. In addition, this commitment
is subject to (a) the preparation, execution and delivery of mutually
acceptable loan
<PAGE>
documentation, including a credit agreement incorporating substantially the
terms and conditions outlined herein and in the Summary of Terms, (b) the
absence of a material adverse change in the business, financial condition,
operations or properties of (A) you and your subsidiaries, taken as a whole
since September 24, 2000 or (B) the Company and its subsidiaries, taken as a
whole, since September 30, 2000, (c) the condition that there shall not have
occurred and be continuing any material adverse change in loan syndication or
financial or capital market conditions generally from those currently in
effect that adversely affects the syndication of the Credit Facilities, (d)
the completion by each of the Lead Arrangers and Chase of their limited
confirmatory due diligence with respect to the assets and businesses of the
Borrower, the Company and their subsidiaries with results reasonably
satisfactory to them (it being understood that the Lead Arrangers have
completed substantial due diligence to date (including, without limitation, a
review of all publicly available information, with respect to the Company as
of the date hereof), and that, such results have been satisfactory to the Lead
Arrangers, provided that such limited confirmatory due diligence with respect
to the Company and its subsidiaries shall be limited to publicly available
information unless and until the Borrower shall be able to conduct a more
inclusive due diligence investigation of the Company and its subsidiaries),
and (e) the accuracy and completeness in all material respects of all
representations that you make to us taken as a whole and all information that
you furnish to us in connection with this commitment and your compliance with
the terms of this Commitment Letter. The commitments of Morgan Stanley and
Chase set forth in this Commitment Letter will terminate on the earlier of (i)
the date on which the Borrower publicly announces that it is abandoning the
Acquisition and (ii) October 31, 2001, unless the Transaction closes on or
before such date.
To induce the Lead Arrangers and Chase to issue this letter and to
continue with their due diligence efforts, you hereby agree that all
reasonable out-of-pocket fees and expenses (including the reasonable fees and
expenses of counsel and consultants) of the Lead Arrangers, Chase and their
respective affiliates arising in connection with this letter (and their due
diligence and syndication efforts in connection herewith) and in connection
with the Senior Bank Financing and the other transactions described herein
shall be for your account, whether or not the Transaction is consummated, the
Senior Bank Financing is made available or definitive credit documents are
executed. In addition, you hereby agree to pay when and as due the fees
described in the Fee Letter. You further agree to indemnify and hold harmless
each of the Lenders (including, in any event, each of Morgan Stanley and
Chase) and each director, officer, employee and affiliate thereof (each an
"Indemnified Person") from and against any and all actions, suits, proceedings
(including any investigations or inquiries), claims, losses, damages,
liabilities or expenses of any kind or nature whatsoever which maybe incurred
by or asserted against or involve any such Indemnified Person as a result of
or arising out of or in any way related to or resulting from this letter, the
Transaction or the extension or syndication of the Senior Bank Financing
contemplated by this letter, or in any way arise from any use or intended use
of this letter or the proceeds of the Senior Bank Financing contemplated by
this letter, and you agree to reimburse each Indemnified Person upon demand
for any legal or other out-of-pocket expenses incurred in connection with
investigating, defending or preparing to defend any such action, suit,
proceeding (including any inquiry or investigation) or claim (whether or not
Morgan Stanley, Chase or any such other Indemnified Person is a party to any
action or proceeding out of which any such expenses arise) (collectively, an
"Action"); provided, however,
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that you shall not have to indemnify any Indemnified Person against any loss,
claim, damage, expense or liability to the extent resulting from the gross
negligence or willful misconduct of such Indemnified Person or that are in the
nature of personal injury or damage to property. It is understood and agreed
that, to the extent not precluded by a conflict of interest, the Indemnified
Persons and you shall endeavor to work cooperatively with a view to minimizing
the legal and other expenses associated with any defense and any potential
settlement or judgment. To the extent reasonably practicable and not
disadvantageous to any party, it is anticipated that a single counsel may be
used. Settlement of any claim or litigation involving any material indemnified
amount will require your approval, not to be unreasonably withheld. This
letter is issued for your benefit only and no other person or entity may rely
hereon. Neither Morgan Stanley, nor Chase, nor any other Lender shall be
responsible or liable to you, the Company, the Borrower or any other person
for consequential damages which may be alleged as a result of this letter.
Each Lead Arranger reserves the right to employ the services of its
affiliates in providing services contemplated by this letter and to allocate,
in whole or in part, to such affiliates certain fees payable to such Lead
Arranger in such manner as such Lead Arranger and such affiliates may agree in
their sole discretion. You acknowledge that each Lead Arranger may share with
any of its affiliates, and such affiliates may share with such Lead Arranger,
any information related to the Transaction, the Borrower, any of the
Borrower's subsidiaries, the Company, any of the Company's subsidiaries or any
of the matters contemplated hereby in connection with the Transaction, subject
to an express agreement to keep such information confidential.
The provisions of the immediately preceding two paragraphs shall
survive any termination of this letter.
You represent and warrant that (a) all information that has been or
will hereafter be made available by or on behalf of you or by any of your
representatives in connection with the Transaction and the other transactions
contemplated hereby to the Lead Arrangers and Chase or any of their respective
affiliates or representatives or to any Lender or any potential Lender is and
will be complete and correct in all material respects and does not and will
not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained therein not
misleading in light of the circumstances under which such statements were or
are made considered as a whole, together with publicly available information,
and (b) all financial projections, if any, that have been or will be prepared
by you on your behalf or by any of your representatives and made available to
the Lead Arrangers and Chase or any of their respective affiliates or
representatives or to any Lender or any potential Lender in connection with
the Transaction and the other transactions contemplated hereby have been or
will be prepared in good faith based upon reasonable assumptions (it being
understood that such projections are subject to significant uncertainties and
contingencies, many of which are beyond your control, and that no assurance
can be given that any particular projections will be realized). You agree to
supplement the information and projections from time to time so that the
representations and warranties contained in this paragraph remain complete and
correct.
<PAGE>
In issuing this commitment, each Lead Arranger and Chase is relying
on the accuracy of the information furnished to it by you or on your behalf
(collectively, the "Pre-Commitment Information"). The obligations of the Lead
Arrangers and Chase under this Commitment Letter and of any Lender that issues
a commitment for the Senior Bank Financing are made solely for your benefit
and may not be relied upon or enforced by any other person or entity.
You acknowledge that each of the Lead Arrangers and Chase, and their
respective affiliates (each a "Bank" and, collectively, the "Banks") may be
providing debt financing, equity capital or other services (including
financial advisory services) to other companies in respect of which you may
have conflicting interests regarding the transactions described herein and
otherwise, provided that, prior to the date on which the Borrower abandons the
Tender Offer, neither the Lead Arrangers nor Chase will, without the consent
of the Borrower, provide any debt financing, equity capital or other services
(including financial advisory services) for a competing bid for the
acquisition of the Company (other than through any financing commitment
existing on the date hereof). The Banks expressly agree to maintain non-public
information received from you confidential. None of the Banks will use
confidential information obtained from you by virtue of the transactions
contemplated by this Commitment Letter or its other relationships with you in
connection with the performance by such Banks of services for other companies,
and none of the Banks will furnish any such information to other companies.
You also acknowledge that none of the Banks has an obligation to use in
connection with the transactions contemplated by this Commitment Letter, or to
furnish to you, confidential information obtained from other companies.
You are not authorized to show or circulate this letter to any other
person or entity (other than your legal and financial advisors in connection
with your evaluation hereof and except as required by law or stock exchange
requirements) until such time as you have accepted this letter as provided in
the immediately succeeding paragraph. If the letter is not accepted by you as
provided in the immediately succeeding paragraph, you are to immediately
return this letter (and any copies hereof) to the undersigned. This letter may
be executed in any number of counterparts, and by the different parties hereto
on separate counterparts, each of which counterpart shall be an original, but
all of which shall together constitute one and the same instrument.
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This letter and the Fee Letter shall be governed by, and construed
in accordance with the laws of the state of New York, and any right to trial
by jury with respect to any claim, action, suit or proceeding arising out of
or contemplated by this letter and/or the related Fee Letter is hereby waived.
The parties hereto hereby submit to the non-exclusive jurisdiction of the
federal and New York State courts located in the City of New York in
connection with any dispute related to this letter or the Fee Letter or any
matters contemplated hereby or thereby. Delivery of an executed counterpart of
this Commitment Letter by telecopier shall be effective as delivery of a
manually executed counterpart of this Commitment Letter.
Very truly yours,
MORGAN STANLEY SENIOR
FUNDING, INC.
By /s/ Todd Vannucci
---------------------------
Title: Vice President
CHASE SECURITIES INC.
By /s/ B. Joseph Lillis
---------------------------
Title: Managing Director
THE CHASE MANHATTAN BANK
By /s/ B. Joseph Lillis
---------------------------
Title: Managing Director
Agreed to and Accepted as of the
4th day of December, 2000
WEYERHAEUSER COMPANY
By /s/ Richard J. Taggart
---------------------------
Title: Vice President and
Treasurer
<PAGE>
EXHIBIT A
SUMMARY OF CERTAIN TERMS AND CONDITIONS*
The Parties
Borrower: Weyerhaeuser Company.
Lead Arrangers and Joint
Book-Runners: Morgan Stanley and CSI.
Syndication Agent: Morgan Stanley.
Administrative Agent: Chase.
Lenders: Morgan Stanley, Chase and a syndicate of financial
institutions and institutional lenders arranged by
the Lead Arrangers in consultation with the
Borrower.
Description of Credit Facilities Comprising the Senior Bank Financing
364-Day Facility: 364-day Revolving Credit Facility in the amount of
$1.150 billion.
Maturity and Amortization: The final maturity of the 364-Day Facility shall be
the date which occurs 364 days after the Closing
Date, provided, however, that the date of the final
maturity may by extended by 12 months at the option
of the Borrower so long as, both before and after
giving effect to such extension, no default shall
have occurred and be continuing. Loans made
pursuant to the 364-Day Facility (the "364-Day
Loans") shall be repaid in full on the final
maturity date.
5-Year Facility: 5-Year Revolving Credit Facility in the amount of
$1.960 billion, with letter of credit and swing
line sublimits to be agreed upon.
Maturity and Amortization: The final maturity of the 5-Year Facility shall be
the date which occurs five years after the Closing
Date. The loans made pursuant to the 5-Year
Facility (the "5-Year Loans") shall be repaid in
full on the final maturity date, and all letters of
credit issued thereunder shall terminate prior to
such time.
Bridge
Facility: Bridge Revolving Credit Facility in the amount of
$2.290 billion.
--------------------------
* Capitalized terms used herein and not defined herein shall have the
meanings provided in the commitment letter (the "Commitment Letter")
to which this summary is attached.
<PAGE>
Maturity: The final maturity of the Bridge Facility shall be,
as applicable, (a) the date which occurs 18 months
after the Closing Date if the long-term unsecured
debt rating of the Borrower, after giving effect to
the Transaction (the "Rating") by Moody's Investors
Service, Inc. ("Moody's") as of the Closing Date is
at least Baa2, and if the Rating by Standard &
Poor's Ratings Services ("S&P") as of the Closing
Date is at least BBB, or (b) the date which occurs
24 months after the Closing Date if the Rating of
the Borrower as of the Closing Date is equal to
Baa3 by Moody's or equal to BBB- by S&P. Loans made
pursuant to the Bridge Facility (the "Bridge
Loans", and together with the 364-Day Loans and the
5-Year Loans, the "Loans") shall be repaid in full
on the final maturity date. To the extent the final
maturity of the Bridge Facility shall be 24 months
after the Closing Date as set forth in item (b)
above, the Bridge Loans shall be subject to an
amortization payment of $1.25 billion on the date
which occurs 12 months after the Closing Date.
Use of Proceeds: The Loans shall be utilized solely to finance the
Acquisition.
Availability: Loans may be borrowed, repaid and reborrowed on and
after the Closing Date until the final maturity
date for the applicable Credit Facility.
Terms Applicable to the Entire Senior Bank Financing
Closing Date: On or before October 31, 2001.
Interest Rates: At the option of the Borrower, Loans may be
maintained from time to time as (x) Base Rate Loans
which shall bear interest at the Applicable Margin
in excess of the Base Rate in effect from time to
time or (y) Eurodollar Loans which shall bear
interest at the Applicable Margin in excess of the
Eurodollar Rate (adjusted for reserves to the
extent incurred) as determined by the
Administrative Agent for the respective interest
period.
"Base Rate" shall mean the higher of (x) 1/2 of 1%
in excess of the federal funds rate and (y) the
rate that the Administrative Agent announces from
time to time as its prime or base commercial
lending rate, as in effect from time to time.
The "Applicable Margin" means at any time for each
Credit Facility, the applicable percentage
determined based on the Rating in effect from time
to time, provided that (x) the Applicable Margin
for Eurodollar Loans shall not be less than 0.525%
and shall not exceed 1.375%, and (y) the Applicable
Margin for Base
<PAGE>
Rate Loans shall be equal to or greater than 0.00%
and shall not exceed 0.500%.
During the continuance of any payment default under
the loan documentation, the Applicable Margin on
all such defaulted obligations owing under the loan
documentation shall increase by 2% per annum.
Interest periods of 1, 2, 3 and 6 months shall be
available in the case of Eurodollar Loans.
Interest in respect of Base Rate Loans shall be
payable quarterly in arrears on the last business
day of each quarter. Interest in respect of
Eurodollar Loans shall be payable in arrears at the
end of the applicable interest period and every
three months in the case of interest periods in
excess of three months. Interest will also be
payable at the time of repayment of any Loans, and
at maturity. Interest in respect of Eurodollar
Loans shall be based on a 360-day year. Interest in
respect of Base Rate Loans and all commitment fee
and other fee calculations shall be based on a
365-day year.
Lead Arranger and
Administrative
Agent Fees: The Lead Arrangers and the Administrative Agent
shall receive such fees as have been separately
agreed upon with the Borrower.
Letter of Credit Fees: Applicable Margin for Eurodollar Loans which are
5-Year Loans on the aggregate outstanding stated
amounts of letters of credit plus an additional 1/8
of 1% on the aggregate outstanding stated amounts
of letters of credit to be paid as a fronting fee
to the issuing bank.
Facility Fees: In respect of each Credit Facility a per annum
percentage determined based on the Rating in effect
from time to time, on each Lender's share of the
Senior Bank Financing from the date of acceptance
of such Lender's commitment, payable (a) quarterly
in arrears and (b) on the date of termination or
expiration of the commitments, provided that the
Facility Fee shall not be less than 0.100% and
shall not exceed 0.250%.
<PAGE>
Voluntary Commitment
Reductions: Voluntary reductions to the unutilized portion of
any Credit Facility may be made from time to time
by the Borrower without premium or penalty.
Voluntary Prepayment: The Borrower may, upon at least one business day's
notice in the case of Base Rate Loans and three
business days' notice in the case of Eurodollar
Loans, prepay, in full or in part, the Senior Bank
Financing without premium or penalty; provided,
however, that each partial prepayment shall be in
an amount of $25,000,000 or an integral multiple of
$1,000,000 in excess thereof; provided further that
any such prepayment of Eurodollar Loans shall be
made together with reimbursement for any funding
losses of the Lenders resulting therefrom to the
extent such funding losses shall have been claimed
within 6 months after the occurrence thereof.
Mandatory Prepayment
and Commitment
Reduction: All net cash proceeds from sales of property and
assets of the Borrower and its subsidiaries
(excluding (i) sales of inventory and timberlands
in the ordinary course of business, (ii) other
exceptions to be mutually agreed and (iii) any
casualty and condemnation proceeds and sales
proceeds to the extent reinvested in the business
of the Borrower and it subsidiaries or applied to
repair or replace the lost asset within a certain
period of time to be mutually agreed) shall be
applied first to prepay the Bridge Facility,
second, to the 5-Year Facility and third to the
364-Day Facility. All such prepayments made shall
result in a permanent reduction of the commitments
under the applicable Credit Facilities.
All net cash proceeds from the issuance after the
Closing Date of additional debt and equity of the
Borrower and its subsidiaries otherwise permitted
under the loan documentation, except for certain
net cash proceeds from specific issuances to be
agreed upon, shall be applied to prepay the Bridge
Facility. All such prepayments made with respect to
the Bridge Facility shall result in a permanent
reduction of the commitments under the Bridge
Facility.
Documentation: The commitments of the Lead Arrangers and Chase
will be subject to the negotiation, execution and
delivery of definitive financing agreements
consistent with the terms of this letter and on
other terms substantially similar to those
contained in the Borrower's existing senior credit
facilities, in each case prepared by counsel to the
Lead Arrangers. The definitive financing agreement
shall
<PAGE>
provide that the covenants and representations and
warranties shall include the Company and its
subsidiaries only on and after the date on which
the Borrower directly or indirectly effectively
controls the Company.
Conditions Precedent
to Initial Extension
of Credit: Those customarily found in credit agreements for
similar financings and other provisions customary
for financings of this type, including, without
limitation, the following:
(i) The Lenders shall be reasonably satisfied
with the final terms and conditions
(including any modifications made thereto
from time to time) of the Tender Offer,
including, without limitation, the price per
share and number of shares to be acquired
(unless it consists of at least sufficient
shares of Company Stock to enable the
Purchaser, voting without any other
shareholder of the Company, to approve a
Merger of the Purchaser, the Borrower or one
of its wholly owned subsidiaries with the
Company), and with the proposed terms and
conditions (including any modifications made
thereto from time to time) of the Merger, if
any; the Lenders shall be reasonably
satisfied with all legal and tax aspects of
the Tender Offer and the Merger, if any; and
all documentation relating to the Tender
Offer and the Merger, if any, including,
without limitation, the offer to purchase
the Company Stock and the Merger Agreement,
if any, shall be in form and substance
satisfactory to the Lenders. The Lenders
shall be satisfied that all of the existing
senior bank credit facilities of the
Borrower have been repaid in full and the
commitments thereunder terminated.
Contemporaneously with a merger of the
Company, the senior bank credit facilities
of the Company shall be repaid.
(ii) All documentation relating to the Senior
Bank Financing, including a credit agreement
incorporating substantially the terms and
conditions outlined herein, and the other
parts of the Transaction shall be in form
and substance reasonably satisfactory to the
Lenders.
(iii) Except as otherwise disclosed publicly or to
the Lead Arrangers prior to the date of the
Credit Agreement, there shall not have
occurred (i) a material adverse change in
the business, financial condition,
operations, or properties of (A) the Company
and its subsidiaries, taken as a whole,
<PAGE>
since September 30, 2000, or (B) the
Borrower and its subsidiaries, taken as a
whole, since September 24, 2000.
(iv) Except as otherwise publicly disclosed prior
to the date of the Commitment Letter, there
shall exist no action, suit, investigation,
litigation or proceeding pending or
threatened in any court or before any
arbitrator or governmental or regulatory
agency or authority that (i) could
reasonably be expected to (A) have a
material adverse effect on the business,
financial condition, operations, or
properties of (1) the Company and its
subsidiaries, taken as a whole, or (2) the
Borrower and its subsidiaries, taken as a
whole, (B) adversely affect the ability of
the Borrower or any of its subsidiaries to
perform its obligations under the loan
documentation or (C) adversely affect the
rights and remedies of the Administrative
Agent and the Lenders under the loan
documentation or (ii) could reasonably be
expected to have a material adverse effect
on the Transaction or the Senior Bank
Financing (collectively, a "Material Adverse
Effect").
(v) All governmental and third party consents
and approvals necessary in connection with
the Transaction and the Senior Bank
Financing shall have been obtained (without
the imposition of any conditions that are
not acceptable to the Lenders) and shall
remain in effect, except where the failure
to have obtained such consent or approval,
individually or in the aggregate with any
other consents or approvals, would not
reasonably be expected to result in a
Material Adverse Effect; all applicable
waiting periods shall have expired without
any material adverse action being taken by
any competent authority; and no law or
regulation shall be applicable that
restrains, prevents or imposes materially
adverse conditions upon the Transaction or
the Senior Bank Financing.
(vi) The Lenders shall have received (i)
reasonably satisfactory opinions of counsel
for the Borrower as to the transactions
contemplated hereby (including, without
limitation, the tax aspects thereof and
compliance with all applicable securities
laws) and (ii) such corporate resolutions,
certificates and other documents as the
Lenders shall reasonably request.
<PAGE>
(vii) There shall exist no default under any of
the loan documentation, and the
representations and warranties of the
Borrower therein shall be true and correct
in all material respects immediately prior
to, and after giving effect to, the initial
extension of credit under the loan
documentation.
(viii) All accrued fees and expenses of the
Administrative Agent, the Lead Arrangers and
the Lenders (including the fees and expenses
of counsel for the Lead Arrangers) shall
have been paid.
(ix) The Borrower's long-term unsecured debt,
after giving effect to the Transaction,
shall have been rated "investment grade" by
both Moody's and S&P and, if the Borrower is
rated in the lowest investment grade
category by both Moody's and S&P, shall not
have been placed on credit watch by either
Moody's or S&P with negative implications,
as of the Closing Date.
Conditions Precedent
to Subsequent
Extensions of Credit: There shall exist no default under any of the loan
documentation, and the representations and
warranties of the Borrower (other than the
representation set forth in item (iii) under
Conditions Precedent to Initial Extension of
Credit) therein shall be true and correct in all
material respects immediately prior to, and after
giving effect to, such extension of credit.
Representations and
Warranties: Representations and warranties substantially
similar to those contained in the Borrower's
existing senior credit agreements and others
customary for transactions of this type.
Covenants: Affirmative and negative covenants substantially
similar to those contained in the Borrower's
existing senior credit agreements and others
customary for transactions of this type.
Financial Covenants: A total debt to capitalization ratio and a minimum
net worth covenant to be determined.
Events of Default: Events of Default substantially similar to those
contained in the Borrower's existing senior credit
agreements and others customary for transactions of
this type.
Expenses: The Borrower shall pay all of the Administrative
Agent's and the Lead Arrangers' due diligence,
syndication (including printing,
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distribution and bank meetings) and all other
out-of-pocket expenses incurred by the
Administrative Agent or the Lead Arrangers
(including the fees and expenses of counsel for the
Lead Arranger), whether or not any of the
transactions contemplated hereby are consummated.
The Borrower shall also pay the expenses of the
Administrative Agent, the Lead Arrangers and the
Lenders in connection with the enforcement of any
of the loan documentation.
Indemnity: The Borrower will indemnify and hold harmless the
Administrative Agent, the Lead Arrangers, each
Lender and each of their affiliates and their
officers, directors, employees, agents and advisors
from claims and losses relating to the Transaction
or the Senior Bank Financing, subject to customary
exceptions.
Required Lenders: Lenders holding loans and commitments representing
more than 50% of the aggregate amount of loans and
commitments under the Senior Bank Financing.
Waivers &
Amendments: Amendments and waivers of the provisions of the
loan agreement and other definitive credit
documentation will require the approval of the
Required Lenders, except that the consent of all
affected Lenders be required with respect to (i)
increases in commitment amounts, (ii) reductions of
principal, interest, or fees and (iii) extensions
of scheduled maturities.
Assignments and
Participations: Assignments may be non-pro rata and must be to
Eligible Assignees and, in each case other than an
assignment to a Lender or an assignment of the
entirety of a Lender's interest in the Senior Bank
Financing, in a minimum amount to be agreed. Each
Lender will also have the right, without consent of
the Borrower or the Administrative Agent, to assign
(i) as security all or part of its rights under the
loan documentation to any Federal Reserve Bank and
(ii) all or part of its rights or obligations under
the loan documentation to any of its affiliates. No
participation shall include voting rights, other
than for reductions or postponements of regularly
scheduled amounts payable.
Taxes: All payments to be free and clear of any present or
future taxes, withholdings or other deductions
whatsoever (other than income taxes in the
jurisdiction of the Lender's applicable lending
office). The Lenders will use reasonable efforts
(consistent with their respective internal policies
and legal and regulatory restrictions
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and so long as such efforts would not otherwise be
disadvantageous to such Lenders) to minimize to the
extent possible any applicable taxes and the
Borrower will indemnify the Lenders and the
Administrative Agent for such taxes paid by the
Lenders or the Administrative Agent; provided that
the Borrower shall have the right to replace any
Lender that shall have claimed such
indemnification.
Miscellaneous: Standard yield protection (including compliance
with risk-based capital guidelines, increased
costs, payments free and clear of withholding taxes
and interest period breakage indemnities),
eurodollar illegality and similar provisions,
defaulting lender provisions, waiver of jury trial
and submission to jurisdiction.
Governing Law: New York.
Counsel for the
Lead Arrangers: Shearman & Sterling.
