SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
September 9, 1994
Date of Report (Date of earliest event reported)
HANDY & HARMAN
(Exact Name of Registrant as Specified in Charter)
New York 1-5365 13-5129420
(State or other jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
250 Park Avenue New York, New York, New York 10177
(Address of Principal Executive Offices) (Zip Code)
(212) 661-2400
Registrant's telephone number, including area code
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
(a) On September 9, 1994, Handy & Harman (the
"Company") entered into a Share Purchase Agreement (the
"Share Purchase Agreement") with all of the shareholders
(the "Shareholders") of SUMCO INC., an Indiana
corporation ("Sumco"), pursuant to which, and at a
closing occurring simultaneously therewith (the
"Closing"), the Company purchased and the Shareholders
sold all of the outstanding shares of capital stock of
Sumco (the "Shares"). Copies of the Share Purchase
Agreement and the press release announcing the purchase
of the Shares is attached as Exhibit 10.1 and Exhibit
10.2 respectively, and each is incorporated herein by
reference in its entirety. Pursuant to the Share
Purchase Agreement, and in consideration for the sale of
the Shares, the Company (i) delivered to the Shareholders
$24,200,000 (less certain transaction expenses) at the
Closing and (ii) delivered and placed into escrow
$800,000 at the Closing, for the purpose of satisfying
claims of the Company and to secure the indemnification
obligations of certain of the Shareholders, under the
Share Purchase Agreement. Pursuant to the Share Purchase
Agreement, the Company also agreed to pay the
Shareholders an additional contingent payment of $1
million in the event that Sumco's Operating Income Amount
(as defined in the Share Purchase Agreement) is equal to
or greater than $5 million. At the Closing, the Company
delivered and placed into escrow $1 million to secure
this obligation. Immediately prior to the Closing, the
Company, on behalf of and at the direction of Sumco,
repaid and discharged certain senior and subordinated
indebtedness of Sumco in the aggregate amount of
$3,921,459.69, Sumco executed and delivered to the
Company a Promissory Note in favor of the Company in the
principal amount of such indebtedness and Sumco caused
the collateral securing such indebtedness to be released.
(b) On September 28, 1994, the Company entered
into the following credit agreements: (i) a Revolving
Credit Agreement (the "New Long Term Revolving Credit
Agreement"), dated as of September 28, 1994, among the
Company, the lenders named therein, The Bank of Nova
Scotia ("Scotiabank"), Chemical Bank ("Chemical") and The
Bank of New York ("BNY"), as co-agents, and Scotiabank,
as administrative agent, which provides the Company with,
upon the terms and conditions set forth therein, a three-
year unsecured $161,250,000 revolving loan facility of
which up to $30,000,000 may be used for the issuance of
letters of credit and (ii) a Short Term Revolving Credit
Agreement, dated as of September 28, 1994, (the "New
Short Term Revolving Credit Agreement", and, together
with the New Long Term Revolving Credit Agreement, the
"New Credit Agreements") among the Company, the lenders
named therein, Scotiabank, Chemical and BNY, as co-
agents, and Scotiabank, as administrative agent, which
provides the Company with, upon the terms and conditions
set forth therein, a 364-day unsecured $53,750,000
revolving loan facility. In connection with the
execution of the New Credit Agreements, the Company
terminated its $161,250,000 revolving credit agreement,
dated as of March 16, 1992, and its $53,750,000 short
term revolving credit agreement, dated as of March 16,
1992. The New Credit Agreements are attached hereto as
Exhibits 10.3 and 10.4 and each is incorporated herein by
reference in its entirety.
(c) On September 28, 1994, the Company entered
into the following consignment agreements: (i) a Fee
Consignment Agreement, dated as of September 28, 1994
(the "Long Term Consignment Agreement"), by and between
the Company, as consignee, and Scotiabank, as consignor,
which provides for the consignment from time to time by
Scotiabank to the Company, upon the terms and conditions
set forth therein, of up to 110,000 troy ounces of gold
and 11,250,000 troy ounces of silver at any time
outstanding on consignment thereunder not to exceed
$52,250,000 for troy ounces of gold and $73,125,000 for
troy ounces of silver, and (ii) a Short Term Fee
Consignment Agreement, dated as of September 28, 1994
(the "Short Term Consignment Agreement", and, together
with the Long Term Consignment Agreement, the
"Consignment Agreements"), by and between the Company, as
consignee, and Scotiabank, as consignor, which provides
for the consignment, from time to time, by Scotiabank to
the Company, upon the terms and conditions set forth
therein, of up to 110,000 troy ounces of gold and
11,250,000 troy ounces of silver at any time outstanding
on consignment thereunder not to exceed $52,250,000 for
troy ounces of gold and $73,125,000 for troy ounces of
silver. The Long Term Consignment Agreement has a term
of three years and the Short Term Consignment Agreement
has a term of 364 days. All gold and silver consigned to
the Company pursuant to the Consignment Agreements will
be located at the Company's plant at 1770 Kings Highway,
Fairfield, Connecticut or the Company's plant at 231
Ferris Avenue, East Providence, Rhode Island. For so
long as either of the Consignment Agreements remain in
effect, the only gold and silver that will be located at
such plants will be gold and silver owned by Scotiabank
and consigned to the Company pursuant to the Consignment
Agreements and gold and silver owned by the United States
government. The Consignment Agreements are attached
hereto as Exhibits 10.5 and 10.6 and each is incorporated
herein by reference in its entirety.
(d) In connection with the execution of the
Consignment Agreements, Scotiabank entered into a Dollar
Supply Agreement and a Short Term Dollar Supply
Agreement, each dated as of September 28, 1994
(collectively, the "Dollar Supply Agreements"), with the
financial institutions named therein, Scotiabank,
Chemical and BNY, as co-agents, and Scotiabank, as
administrative agent, in order to provide financing for
the gold and silver to be consigned by Scotiabank to the
Company pursuant to the Consignment Agreements. Pursuant
to the Consignment Agreements, the Company has agreed to
hold Scotiabank harmless from certain indemnities and
other obligations of Scotiabank under the Dollar Supply
Agreements. The Dollar Supply Agreements are attached
hereto as Exhibits 10.7 and 10.8 and each is incorporated
herein by reference in its entirety.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
10.1 Share Purchase Agreement, dated
September 9, 1994, among the Company
and all of the Shareholders of Sumco Inc.
10.2 Press Release issued by the Company,
dated September 12, 1994.
10.3 Revolving Credit Agreement, dated as
of September 28, 1994, among the
Company, the lenders named therein,
Scotiabank, Chemical and BNY, as co-
agents and Scotiabank, as
administrative agent.
10.4 Short Term Revolving Credit
Agreement, dated as of September 28,
1994, among the Company, the lenders
named therein, Scotiabank, Chemical
and BNY, as co-agents, and
Scotiabank, as administrative agent.
10.5 Fee Consignment Agreement, dated as
of September 28, 1994, between the
Company, as consignee, and
Scotiabank, as consignor.
10.6 Short Term Fee Consignment
Agreement, dated as of September 28,
1994, between the Company, as
consignee, and Scotiabank, as
consignor.
10.7 Dollar Supply Agreement, dated as of
September 28, 1994, with the
financial institutions named
therein, Scotiabank, Chemical and
BNY, as co-agents, and Scotiabank,
as administrative agent.
10.8 Short Term Dollar Supply Agreement,
dated as of September 28, 1994, with
the financial institutions named
therein, Scotiabank, Chemical and
BNY, as co-agents, and Scotiabank,
as administrative agent.
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
hereunto duly authorized.
Dated: October 12, 1994
HANDY & HARMAN
By: /s/ Paul E. Dixon
Name: Paul E. Dixon
Title: Vice President and
General Counsel
EXHIBIT INDEX
Exhibit No. Description Page No.
10.1 Share Purchase Agreement, dated
September 9, 1994, among the Company
and all of the Shareholders.
10.2 Press Release issued by the Company,
dated September 12, 1994.
10.3 Revolving Credit Agreement, dated as
of September 28, 1994 among the
Company, the lenders named therein,
Scotiabank, Chemical and BNY, as co-
agents and Scotiabank, as
administrative agent.
10.4 Short Term Revolving Credit
Agreement, dated as of September 28,
1994, among the Company, the lenders
named therein, Scotiabank, Chemical
and BNY, as co-agents, and
Scotiabank, as administrative agent.
10.5 Fee Consignment Agreement, dated as
of September 28, 1994, between the
Company, as consignee, and
Scotiabank, as consignor.
10.6 Short Term Fee Consignment Agreement,
dated as of September 28, 1994,
between the Company, as consignee,
and Scotiabank, as consignor.
10.7 Dollar Supply Agreement, dated as of
September 28, 1994, with the
financial institutions named therein,
Scotiabank, Chemical and BNY, as co-
agents, and Scotiabank, as
administrative agent.
10.8 Short Term Dollar Supply Agreement,
dated as of September 28, 1994, with
the financial institutions named
therein, Scotiabank, Chemical and
BNY, as co-agents, and Scotiabank, as
administrative agent.
EXHIBIT 10.1
EXECUTED COPY
SHARE PURCHASE AGREEMENT
among
HANDY & HARMAN
and
ALL OF THE SHAREHOLDERS
of
SUMCO INC.
September 9, 1994
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS . . . . . . . . . . . . . .
1.1 DEFINITIONS . . . . . . . . . . . . . .
ARTICLE II PURCHASE AND SALE OF THE
SHARES;
THE CLOSING . . . . . . . . . . . . . .
2.1 PURCHASE AND SALE . . . . . . . . . . .
2.2 CONSIDERATION . . . . . . . . . . . . .
2.3 ADDITIONAL CONTINGENT PAYMENT . . . . .
2.4 APPOINTMENT OF THE MANAGEMENT
REPRESENTATIVE . . . . . . . . . . . . .
2.5 THE CLOSING . . . . . . . . . . . . . .
2.6 DELIVERIES BY THE SELLERS . . . . . . .
2.7 DELIVERIES BY THE BUYER . . . . . . . .
2.8 RELATED MATTERS . . . . . . . . . . . .
2.9 ACTIONS TAKEN IMMEDIATELY PRIOR
TO THE CLOSING . . . . . . . . . . . . .
ARTICLE III REPRESENTATIONS AND WARRANTIES
OF EACH SELLER . . . . . . . . . . . . .
3.1 ORGANIZATION AND STANDING OF PNCC . . .
3.2 AUTHORIZATION; BINDING
OBLIGATION . . . . . . . . . . . . . . .
3.3 TITLE TO THE SHARES . . . . . . . . . .
3.4 CONSENTS AND APPROVALS; NO
VIOLATION . . . . . . . . . . . . . . .
3.5 BROKERS . . . . . . . . . . . . . . . .
ARTICLE IV REPRESENTATIONS AND WARRANTIES
OF THE SELLERS . . . . . . . . . . . . .
4.1 ORGANIZATION AND STANDING OF
SUMCO . . . . . . . . . . . . . . . . .
4.2 ORGANIZATIONAL DOCUMENTS AND
CORPORATE RECORDS . . . . . . . . . . .
4.3 EQUITY INVESTMENTS . . . . . . . . . . .
4.4 AUTHORIZATION . . . . . . . . . . . . .
4.5 SUMCO CAPITALIZATION . . . . . . . . . .
4.6 CONSENTS AND APPROVALS; NO
VIOLATION . . . . . . . . . . . . . . .
4.7 FINANCIAL STATEMENTS . . . . . . . . . .
4.8 ABSENCE OF UNDISCLOSED
LIABILITIES . . . . . . . . . . . . . .
4.9 ACCOUNTS RECEIVABLE . . . . . . . . . .
4.10 INVENTORY . . . . . . . . . . . . . . .
4.11 ABSENCE OF CERTAIN CHANGES OR
EVENTS . . . . . . . . . . . . . . . . .
4.12 PROPERTIES AND ASSETS . . . . . . . . .
4.13 CERTAIN CONTRACTS . . . . . . . . . . .
4.14 COMPLIANCE WITH LAWS AND
PERMITS . . . . . . . . . . . . . . . .
4.15 LITIGATION AND ARBITRATION . . . . . . .
4.16 EMPLOYEE MATTERS . . . . . . . . . . . .
4.17 LABOR RELATIONS . . . . . . . . . . . .
4.18 TAXES . . . . . . . . . . . . . . . . .
4.19 INTELLECTUAL PROPERTY . . . . . . . . .
4.20 ENVIRONMENTAL MATTERS . . . . . . . . .
4.21 INSURANCE . . . . . . . . . . . . . . .
4.22 BANK ACCOUNTS . . . . . . . . . . . . .
4.23 CUSTOMERS AND SUPPLIERS . . . . . . . .
4.24 WARRANTIES; RETURNS AND
CANCELLATIONS . . . . . . . . . . . . .
4.25 AFFILIATE TRANSACTIONS . . . . . . . . .
4.26 BROKERS . . . . . . . . . . . . . . . .
4.27 DISCLOSURE . . . . . . . . . . . . . . .
ARTICLE V REPRESENTATIONS AND WARRANTIES
OF THE BUYER . . . . . . . . . . . . . .
5.1 ORGANIZATION AND STANDING . . . . . . .
5.2 AUTHORIZATION; BINDING
OBLIGATION . . . . . . . . . . . . . . .
5.3 CONSENTS AND APPROVALS; NO
VIOLATION . . . . . . . . . . . . . . .
5.4 INVESTMENT PURPOSE . . . . . . . . . . .
5.5 BROKERS . . . . . . . . . . . . . . . .
ARTICLE VI ADDITIONAL COVENANTS . . . . . . . . . .
6.1 TRANSFER AND SIMILAR TAXES . . . . . . .
6.2 TAX RETURNS, REFUNDS AND
CREDITS . . . . . . . . . . . . . . . .
6.3 FURTHER ASSURANCES;
COOPERATION . . . . . . . . . . . . . .
6.4 NOTIFICATION OF CERTAIN
MATTERS . . . . . . . . . . . . . . . .
6.5 CONFIDENTIALITY/NO-INVESTMENT . . . . .
6.6 PUBLICITY . . . . . . . . . . . . . . .
6.7 EXPENSES . . . . . . . . . . . . . . . .
ARTICLE VII SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION . . . . . .
7.1 SURVIVAL OF REPRESENTATIONS AND
WARRANTIES . . . . . . . . . . . . . . .
7.2 STATEMENTS AS REPRESENTATIONS . . . . .
7.3 INDEMNIFICATION BY THE SELLERS . . . . .
7.4 INDEMNIFICATION BY THE BUYER . . . . . .
7.5 LIMITATIONS ON INDEMNIFICATION . . . . .
7.6 INDEMNIFICATION PROCEDURES . . . . . . .
7.7 REMEDIES . . . . . . . . . . . . . . . .
ARTICLE VIII MISCELLANEOUS . . . . . . . . . . . . .
8.1 CONSENT TO SERVICE . . . . . . . . . . .
8.2 PARTIES IN INTEREST; NO THIRD
PARTY BENEFICIARIES . . . . . . . . . .
8.3 EXHIBITS AND DISCLOSURE
SCHEDULE . . . . . . . . . . . . . . . .
8.4 ENTIRE AGREEMENT . . . . . . . . . . . .
8.5 WAIVER OF COMPLIANCE . . . . . . . . . .
8.6 VALIDITY . . . . . . . . . . . . . . . .
8.7 COUNTERPARTS . . . . . . . . . . . . .
8.8 HEADINGS . . . . . . . . . . . . . . .
8.9 GOVERNING LAW . . . . . . . . . . . .
8.10 NOTICES . . . . . . . . . . . . . . .
SHARE PURCHASE AGREEMENT
Share Purchase Agreement (the "Agreement"),
dated September 9, 1994, among Handy & Harman, a New York
corporation (the "Buyer"), and all of the shareholders of
SUMCO INC., an Indiana corporation ("Sumco"), whose
names, addresses and holdings in Sumco are set forth on
Exhibit A hereto (individually a "Seller," and
collectively, the "Sellers").
WHEREAS, Sumco is engaged in the business of
electroplating metal products produced by third parties
for application in the automotive, electric, electronic,
telecommunications, computer, consumer products,
aircraft, aerospace and power industries; and
WHEREAS, the Sellers are the beneficial and
record owners of all of the issued and outstanding Common
Shares, without par value, of Sumco; and
WHEREAS, the Buyer desires to purchase, and the
Sellers desire to sell, all of such Common Shares, upon
the terms and conditions set forth herein; and
WHEREAS, immediately prior to the Closing (as
defined herein), the Buyer, on behalf of and at the
direction of Sumco, repaid and discharged certain senior
and subordinated indebtedness of Sumco in the aggregate
amount of $3,921,459.69 Sumco executed and delivered to
the Buyer a Promissory Note in favor of the Buyer in the
principal amount of such indebtedness and Sumco caused
the collateral securing such indebtedness to be released;
NOW, THEREFORE, in consideration of the mutual
agreements, covenants, representations and warranties set
forth herein, and intending to be legally bound hereby,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. For purposes of this
Agreement, the following terms shall have the meanings
set forth below (such meanings to be equally applicable
to both the singular and plural forms of the terms
defined):
"Accounting Books and Records" shall have the
meaning set forth in Section 4.2(b) hereof.
"Accounts Receivable" shall mean all of the
accounts receivable and notes receivable of Sumco.
"Affiliate Transactions" shall have the meaning
set forth in Section 4.25 hereof.
"Audited Balance Sheets" shall have the meaning
set forth in Section 4.7 hereof.
"Audited Financial Statements" shall have the
meaning set forth in Section 4.7 hereof.
"Buyer" shall mean Handy & Harman, a New York
corporation.
"Buyer's Cap Amount" shall have the meaning set
forth in Section 7.5(b) hereof.
"Buyer Indemnified Party" shall have the
meaning set forth in Section 7.3(a) hereof.
"Buyer's Threshold Amount" shall have the
meaning set forth in Section 7.5(b) hereof.
"Closing" shall have the meaning set forth in
Section 2.1 hereof.
"Closing Date" shall have the meaning set forth
in Section 2.5 hereof.
"Code" shall mean the Internal Revenue Code of
1986, as amended.
"Common Shares" shall mean the Common Shares,
without par value, of Sumco.
"Consigned Inventory" shall mean and include
all Inventory which Sumco holds on consignment.
"Contracts" shall mean and include all leases,
contracts, agreements, licenses, License Agreements,
purchase orders, invoices, sales orders, instruments
evidencing indebtedness for borrowed money, mortgages or
other documents securing any indebtedness for borrowed
money, commitments and understandings, written or oral,
and all amendments or modifications thereto, to which
Sumco is a party or by which Sumco is bound.
"Designated Subsidiary" shall mean one or more
existing or to be formed wholly owned subsidiaries of the
Buyer designated to carry out all or part of the
transactions contemplated by this Agreement and the Other
Documents.
"Disclosure Schedule" shall mean the disclosure
schedule delivered in connection herewith and attached
hereto.
"Duffy" shall mean Patrick C. Duffy, a director
of Sumco.
"Earnout Amount" shall have the meaning set
forth in Section 2.3 hereof.
"Earnout Escrow Agreement" shall have the
meaning set forth in Section 2.8(b) hereof.
"Earnout Period" shall have the meaning set
forth in Section 2.3(c) hereof.
"Encumbrance" shall mean any lien, encumbrance,
proxy, voting trust arrangement, pledge, security
interest, collateral security agreement, financing
statement (and similar notices) filed with any
Governmental Authority, claim (including any claim as
defined in the Code), charge, equities, mortgage, pledge,
objection, title defect, option, restrictive covenant or
restriction on transfer of any nature whatsoever, and the
interest of the lessor in any property subject to a
capital lease.
"Environmental Laws" shall have the meaning set
forth in Section 4.20(a) hereof.
"Environmental Permits" shall have the meaning
set forth in Section 4.20(b) hereof.
"ERISA" shall mean the Employee Retirement
Income Security Act of 1974, as amended, and the rules
and regulations promulgated thereunder.
"ERISA Affiliate" shall have the meaning set
forth in Section 4.16(b) hereof.
"ERISA Plans" shall have the meaning set forth
in Section 4.17(b) hereof.
"Escrow Agent" shall have the meaning set forth
in Section 2.2(a)(ii) hereof.
"Escrow Agreement" shall have the meaning set
forth in Section 2.8(a) hereof.
"Escrow Amount" shall have the meaning set
forth in Section 2.2(a)(ii) hereof.
"Family Relationship" shall mean any
relationship by blood, marriage, or adoption, not more
than first cousin, between (i) a salaried employee of
Sumco and any other employee of Sumco and (ii) to the
knowledge of Sumco and the Management Sellers, one or
more hourly employees of Sumco.
"GAAP" shall mean generally accepted accounting
principles as in effect on the date hereof.
"Governmental Authority" shall mean any
government or political subdivision thereof, whether
federal, state, local or foreign, or any agency,
department, commission, board, bureau, court, tribunal,
body, administrative or regulatory authority or
instrumentality of any such government or political
subdivision.
"Hazardous Material" shall mean any substance
that is defined as a "hazardous waste," "hazardous
substance," "pollutant" or "contaminant" under any
Environmental Law or the presence of which requires an
investigation or remediation under any Environmental Law,
including, without limitation, gasoline, diesel fuel and
other petroleum hydrocarbons.
"HSR Act" shall mean the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the
rules and regulations thereunder.
"Income Taxes" shall mean all Taxes based upon
or measured by income.
"Indemnitor" shall have the meaning set forth
in Section 7.6(a) hereof.
"Intellectual Property" shall mean all U.S. and
foreign patents and patent applications, registered and
unregistered copyrights and copyright applications
(including copyrights in proprietary computer software
and databases), trademarks, service marks, trade dress,
logos, tradenames and similar business identifiers,
including, in each case, all registrations and
applications therefor, and the goodwill of the business
symbolized by any of the foregoing, and trade secrets,
knowhow, formulae, processes, inventions (whether
patentable or unpatentable) and other technical
information.
"Inventory" shall mean and include all
inventory owned or held by Sumco and used in the conduct
of its business and operations, including manufacturing
supplies, raw materials, components, repair parts, work-
in-progress, finished goods and other similar items,
whether new or used.
"Law" shall mean any law (including common
law), rule, regulation, restriction (including zoning),
code, statute, ordinance, order, writ, injunction,
judgment, decree or other requirement of a Governmental
Authority.
"License Agreements" shall have the meaning set
forth in Section 4.19(a) hereof.
"Losses" shall mean and include all demands,
claims, actions, causes of action, assessments, damages,
losses, liabilities, judgments, settlements, fines,
penalties, sanctions, costs and expenses (including,
without limitation, interest, penalties, reasonable
attorneys' fees and expenses as incurred, and all other
reasonable costs of investigating and defending third
party claims as incurred).
"Management Representative" shall have the
meaning set forth in Section 2.4 hereof.
"Management Sellers" shall mean and include R.
Robert Brouillard, Guy R. Brouillard, Thomas R.
Brouillard, Mark R. Brouillard, Lawrence H. Schone,
G. Winfield Yarnell, Jr., Pierre J. Plante, Gary F. Cooke
and Gary M. Lents.
"Material Contract" shall mean any Contract
that (i) is with any of the Sellers' Affiliates, (ii)
involves an obligation or commitment on the part of Sumco
of more than $25,000 or (iii) which otherwise is material
to Sumco's financial condition, results of operations,
assets, liabilities, business or, to the knowledge of
Sumco and the Management Sellers, Sumco's prospects.
"NBD" shall mean NBD Bank, N.A., a national
banking association, and the successor-in-interest to INB
National Bank.
"Operating Income" shall have the meaning set
forth in Section 2.3(c) hereof.
"Operating Income Amount" shall have the
meaning set forth in Section 2.3(c) hereof.
"Order" shall mean any order, judgment,
injunction, award, decree, writ, rule or similar action
of any Governmental Authority.
"Other Documents" shall have the meaning set
forth in Section 2.5 hereof.
"Owned Inventory" shall mean and include all
Inventory other than Consigned Inventory.
"PBGC" shall have the meaning set forth in
Section 4.16(d) hereof.
"Permits" shall mean any franchise, license,
certificate, approval, identification number,
registration, permit, authorization, order or approval
of, and any required registration with, any Governmental
Authority.
"Per Share Consideration" shall mean $30,788.17
unless and until the full Earnout Amount is paid to the
Sellers by the Escrow Agent, in which case "Per Share
Consideration" shall mean $32,019.70.
"Person" shall mean any individual,
partnership, firm, trust, association, corporation, joint
venture, joint stock company, unincorporated
organization, Governmental Authority or other entity.
"Plans" shall have the meaning set forth in
Section 4.16(b) hereof.
"PNCC" shall mean PNC Capital Corp., a Delaware
corporation.
"Pre-Closing Period" shall mean that portion of
any Straddle Period which ends on the Closing Date.
"Pro Rata Proceeds" shall mean, with respect to
any Seller, an amount equal to the product of the Per
Share Consideration and such Seller's number of Shares as
set forth on Exhibit A hereto.
"Real Property" shall have the meaning set
forth in Section 4.12(a) hereof.
"Securities Act" shall mean the Securities Act
of 1933, as amended, and the rules and regulations
promulgated thereunder.
"Sellers" shall have the meaning set forth in
the preamble.
"Sellers' Affiliates" shall have the meaning
set forth in Section 4.25 hereof.
"Sellers' Cap Amount" shall have the meaning
set forth in Section 7.5(a) hereof.
"Seller Indemnified Party" shall have the
meaning set forth in Section 7.4 hereof.
"Sellers' Threshold Amount" shall have the
meaning set forth in Section 7.5(a) hereof.
"Shareholders' Agreement" shall mean the
Shareholders' Agreement, dated July 19, 1990, among R.
Robert Brouillard, Guy R. Brouillard, Thomas R.
Brouillard, Lawrence H. Schone, G. Winfield Yarnell, Jr.,
Pierre J. Plante, Gary F. Cooke, and PNC Capital Corp.,
as amended.
"Shares" shall mean the 812 Common Shares
issued and outstanding as of the Closing.
"Short Period" shall have the meaning set forth
in Section 6.2(a) hereof.
"Short Period Return" shall have the meaning
set forth in Section 6.2(a) hereof.
"Straddle Period" shall mean any taxable period
that begins before and ends after the Closing Date.
"Straddle Period Returns" shall have the
meaning set forth in Section 6.2(b) hereof.
"Sumco" shall mean SUMCO INC., an Indiana
corporation.
"Sumco's Transaction Expenses" shall mean
$23,363.36, which amount reflects certain actual costs
and expenses incurred by Sumco in connection with the
transactions contemplated by this Agreement.
"Tax Notices" shall have the meaning set forth
on Schedule 4.7(a) of the Disclosure Schedule.
"Tax Return" shall mean any return, report,
information return or other document (including any
related or supporting information) with respect to Taxes.
"Taxes" shall mean all taxes, charges, fees,
duties, levies, penalties or other assessments imposed by
any federal, state, local or foreign Governmental
Authority, including, but not limited to, income, gross
receipts, excise, property, sales, gain, use, license,
capital stock, transfer, franchise, payroll, withholding,
social security or other taxes, including any interest,
penalties or additions attributable thereto.
"Third Party Claim" shall have the meaning set
forth in Section 7.6(b) hereof.
"Title Company" shall mean the First American
Title Insurance Company.
"Title Policy" shall mean the title insurance
policy with extended coverage issued by the Title Company
pursuant to Commitment No. GC4206.
"Transfer Taxes" shall have the meaning set
forth in Section 6.1 hereof.
"Warn Act" shall mean the Worker Adjustment and
Retraining Notification Act of 1988.
"1994 Balance Sheet" shall have the meaning set
forth in Section 4.7 hereof.
"1994 Financial Statements" shall have the
meaning set forth in Section 4.7 hereof.
ARTICLE II
PURCHASE AND SALE OF THE SHARES; THE CLOSING
2.1 Purchase and Sale. Upon the terms and
subject to the conditions hereof, at the closing referred
to in Section 2.5 hereof and taking place simultaneously
herewith (the "Closing"), the Sellers are selling,
assigning, transferring and delivering to the Buyer, and
the Buyer is accepting and purchasing from the Sellers,
free and clear of all Encumbrances, the Shares. The
number of and percentage of outstanding Shares being sold
by each of the Sellers is set forth opposite such
Seller's name on Exhibit A hereto.
2.2 Consideration.
(a) Upon the terms and subject to the
conditions hereof, in reliance on the representations,
warranties, covenants and agreements of the Sellers
contained herein, and in consideration of the
aforementioned sale, assignment, transfer and delivery of
the Shares, the Buyer is delivering at the Closing by
interbank or wire transfer of immediately available
funds, the following:
(i) $24,200,000, less Sumco's
Transaction Expenses, to an account designated
by the Sellers; and
(ii) $800,000 (the "Escrow
Amount") to NBD, as escrow agent (the "Escrow
Agent"), to be held and disposed of by the
Escrow Agent pursuant to the Escrow Agreement
referred to in Section 2.8(a) hereof.
(b) The foregoing payments and the
amount, if any, to be paid by the Buyer to the Sellers
pursuant to Section 2.3 hereof shall constitute the full
purchase price for the Shares. Any portion of the Escrow
Amount paid to the Buyer shall be deemed a reduction in
the purchase price paid by the Buyer for the Shares.
(c) Each of the Sellers shall be entitled
to receive such percentage of the payment made pursuant
to subsection (a)(i) of this Section 2, and shall have
such percentage interest in the payment to the Escrow
Agent made pursuant to subsection (a)(ii) of this Section
2, as is set forth opposite such Seller's name on Exhibit
A hereto.
2.3 Additional Contingent Payment. (a)
Subject to the provisions of this Section 2.3, in
reliance on the representations, warranties, covenants
and agreements of the Sellers contained herein, in the
event that the Operating Income Amount once finalized and
binding in accordance with Section 2.3(d) hereof is equal
to or greater than $5 million, then at the time specified
in Section 2.3(d) hereof, the Buyer shall deliver (or
cause the Escrow Agent to deliver) to the Sellers $1
million (the "Earnout Amount") as additional
consideration for the aforementioned sale, assignment,
transfer and delivery of the Shares. Each of the Sellers
shall be entitled to receive such percentage of any
payment made pursuant to the preceding sentence, as is
set forth opposite such Seller's name on Exhibit A
hereto.
(b) To secure the Buyer's obligations
under this Section 2.3, the Buyer is delivering at the
Closing the Earnout Amount to the Escrow Agent, to be
held and disposed of by the Escrow Agent pursuant to the
Earnout Escrow Agreement referred to in Section 2.8(b)
hereof. The Sellers shall not be deemed to have received
the Earnout Amount, constructively or otherwise, unless
and until the Escrow Agent shall make payment thereof to
the Sellers.
(c) "Operating Income Amount" shall mean
the operating income of Sumco for the twelve-month period
ending June 30, 1995 (the "Earnout Period"), determined
in accordance with GAAP applied on a basis consistent
with the 1994 Financial Statements ("Operating Income");
provided that for the sole purpose of determining the
Operating Income Amount, Operating Income shall not
include:
(i) any deduction for any
management fee or allocation of overhead of the
Buyer (or its affiliates) assessed Sumco during
the Earnout Period, provided that any third
party fees or expenses incurred by the Buyer on
behalf of Sumco shall be deducted;
(ii) any adjustments made to
the historical accounting basis of Sumco's
assets resulting from the application of
Accounting Principles Board Opinion No. 16
(Accounting for Business Combinations)
(including subsequent amendments and
interpretations thereof);
(iii) any change to the method
of determining accruals and/or reserves from
those employed by Sumco for the fiscal year
ending June 30, 1994; and
(iv) any change in the benefit
costs of Sumco from those incurred for the
fiscal year ending June 30, 1994 as a result of
coverage under any benefit plans, programs,
arrangements or agreements sponsored by the
Buyer.
(d) Within sixty days after the
expiration of the Earnout Period, the Buyer shall cause
Sumco to prepare and deliver to the Sellers, at the
Buyer's sole cost and expense, the computation of the
Operating Income Amount for the Earnout Period. If such
computation results in no payment to the Sellers pursuant
to Section 2.3(a) hereof, upon reasonable advance notice,
the Buyer shall afford PNCC and the Management
Representative reasonable access to the books and records
of Sumco and the Buyer in order to evaluate Sumco's
computation of the Operating Income Amount. Such
computation shall be conclusive and binding on the
parties hereto, unless within 30 days after the receipt
of such computation, the Sellers notify the Buyer in
writing that they (or their independent certified public
accountants (which if engaged, shall be at the Sellers'
sole cost and expense)) disagree with the Buyer as to
such computation, the parties shall use all reasonable
efforts to resolve such disagreement. If the parties
agree upon the resolution of their disagreement, such
resolution shall be conclusive and binding upon the
parties. If the parties are unable to resolve their
disagreement within 90 days after the Sellers have given
such written notice, then the Buyer and the Sellers will
select and retain an accounting firm mutually agreeable
to the Buyer and the Sellers to resolve such disagreement
(the "Third Accounting Firm"). The Buyer's computation
of the Operating Income Amount as adjusted to reflect the
resolution of such disagreement in accordance with this
Section 2.3(d), shall become the "Operating Income
Amount." The fees, costs and expenses for the services
of the Third Accounting Firm shall be divided equally
between the Buyer and the Sellers. The Third Accounting
Firm shall be instructed to use every reasonable effort
to perform its services within 30 days of the submission
to it of any disagreements, and, in any case, as soon as
practicable after such submission. The Third Accounting
Firm shall perform such procedures and examine such books
and records of Sumco and the Buyer as it deems relevant.
Such determination of the Operating Income Amount shall
be conclusive and binding on the parties hereto, and may
be enforced by appropriate judicial proceedings. The
Management Representative, PNCC and the Buyer shall
jointly notify the Escrow Agent of such conslusive and
binding determination and shall instruct the Escrow Agent
as to the disposition of the Earnout Amount in accordance
with this Section 2.3.
2.4 Appointment of the Management
Representative. Each Management Seller and Duffy hereby
irrevocably appoints R. Robert Brouillard (the
"Management Representative") as such Seller's attorney-
in-fact and representative, to do any and all things and
to execute any and all documents in such Seller's name,
place and stead in connection with this Agreement and the
transactions contemplated hereby, including, without
limitation, to accept on such Seller's behalf any amount
payable to such Seller under this Agreement, to give or
receive, on such Seller's behalf, any notice or
instruction under this Agreement, or to amend, terminate
or extend, or waive the terms of, this Agreement. The
Buyer and PNCC shall be entitled to rely, as being
binding upon such Seller, upon any document or other
writing executed by the Management Representative, and
neither the Buyer nor PNCC shall be liable to any
Management Seller or Duffy for any action 36
taken or omitted to be taken by the Buyer or PNCC in
reliance thereon.
2.5 The Closing. The Closing of the
transactions contemplated hereby is taking place at the
offices of Ice Miller Donadio & Ryan, One American
Square, Indianapolis, Indiana on September 9, 1994 (the
"Closing Date"), simultaneously with the execution of
this Agreement and the other agreements, documents,
instruments and writings executed and delivered pursuant
hereto or in connection herewith (collectively, the
"Other Documents"). At the Closing, the actions
described in Sections 2.6, 2.7 and 2.8 hereof are being
taken. All such actions shall be deemed to have occurred
simultaneously.
2.6 Deliveries by the Sellers. At the
Closing, the Sellers are delivering to the Buyer (unless
delivered previously) the following:
(a) stock certificates representing the
Shares accompanied by stock powers duly endorsed in blank
or accompanied by duly executed instruments of transfer,
with all necessary transfer tax and other revenue stamps
affixed thereto;
(b) a receipt for the payment provided
for by Section 2.2(a)(i) hereof;
(c) a Certificate of Existence from the
Indiana Secretary of State for Sumco;
(d) the resignations of the officers and
directors of Sumco as requested by the Buyer prior to the
Closing;
(e) the stock books, stock ledgers and
minute books of Sumco (all other records of Sumco being
located on the premises of Sumco);
(f) a duly executed Certificate of Non-
Foreign Status executed by each of the Sellers which is
attached hereto as Exhibit B;
(g) a Title Policy which is attached
hereto as Exhibit C;
(h) a Survey certified to the Buyer, the
Title Company and Sumco, which is attached hereto as
Exhibit D; and
(i) certified resolutions of the Board of
Directors of Sumco approving, among other things, this
Agreement and the transactions contemplated hereby.
2.7 Deliveries by the Buyer. At the Closing,
the Buyer is delivering (unless delivered previously) the
following:
(a) To the Sellers, the payment provided
for in Section 2.2(a)(i) hereof;
(b) To the Escrow Agent, the payments
provided for in Sections 2.2(a)(ii) and 2.3 hereof;
(c) To the Sellers, a certificate
evidencing the good standing of the Buyer under the laws
of the state of New York; and
(d) To the Sellers, certified resolutions
of the Board of Directors of the Buyer approving, among
other things, this Agreement and the transactions
contemplated hereby.
2.8 Related Matters.
(a) Escrow Agreement. At the Closing,
the Sellers, the Buyer and the Escrow Agent are entering
into the escrow agreement attached hereto as Exhibit E
(the "Escrow Agreement"), pursuant to which the Escrow
Amount will be held in escrow in order to satisfy claims
of the Buyer and secure obligations of the Sellers
pursuant to Article VII hereof.
(b) Earnout Escrow Agreement. At the
Closing, the Sellers, the Buyer and the Escrow Agent are
entering into the escrow agreement attached hereto as
Exhibit F (the "Earnout Escrow Agreement"), pursuant to
which the Earnout Amount will be held in escrow in order
to secure obligations of the Buyer pursuant to Section
2.3 hereof.
(c) Employment Agreements. At the
Closing, R. Robert Brouillard, Guy R. Brouillard, Thomas
R. Brouillard, Gary F. Cooke, Gary M. Lents and Mark R.
Brouillard are entering into the Employment Agreements
with the Buyer which are attached hereto as Exhibits G(1-
6).
(d) Non-Competition Agreement. At the
Closing, R. Robert Brouillard, Guy R. Brouillard, Thomas
R. Brouillard, Gary F. Cooke, Gary M. Lents and Mark R.
Brouillard are entering into the Non-Competition
Agreements with the Buyer which are attached hereto as
Exhibits H(1-6).
2.9 Actions Taken Immediately Prior to the
Closing. Immediately prior to the Closing, the following
actions were taken (which occurred in the order set forth
below):
(i) Sumco and NBD entered into
the Termination of Bank Agreements which is
attached hereto as Exhibit I;
(ii) Sumco and PNCC entered
into the Termination of Investment Agreements
which is attached hereto as Exhibit J;
(iii) the Buyer, on behalf of
and at the direction of Sumco, repaid in full
and discharged certain indebtedness of Sumco in
the aggregate amount of $3,921,459.69;
(iv) Sumco executed and
delivered to the Buyer the Promissory Note a
copy of which is attached hereto as Exhibit K;
(v) the UCC termination
statements in respect of the UCC financing
statements set forth on Schedule 2.9(v) of the
Disclosure Schedule were filed with the
appropriate Governmental Authority;
(vi) the mortgages on the Real
Property were released and satisfied;
(vii) 8 Common Shares were
issued to Gary M. Lents and 4 Common Shares
were issued to Duffy;
(viii) the parties to the
Shareholders' Agreement entered into the
Termination of Shareholders' Agreement which is
attached hereto as Exhibit L;
(ix) Sumco declared and paid to
each Seller a dividend in the amount of $628.07
per Common Share; and
(x) Sumco, the Buyer and Olin
entered into the agreement which is attached
hereto as Exhibit M.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF EACH SELLER
Each Seller (including, without limitation,
PNCC and Duffy) severally represents and warrants to the
Buyer with respect to such Seller and the Common Shares
owned by such Seller as follows:
3.1 Organization and Standing of PNCC. PNCC
is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and
has all requisite corporate power and authority to own,
lease and operate its properties and assets and to carry
on its business and operations as they are now being
conducted.
3.2 Authorization; Binding Obligation. PNCC
has all requisite corporate power and authority, and such
other Seller has the legal capacity and all requisite
power and authority, to execute and deliver this
Agreement and the Other Documents and to consummate the
transactions contemplated hereby and thereby and to
perform such Seller's obligations hereunder and
thereunder. The execution and delivery of this Agreement
and the Other Documents by such Seller and the
consummation of the transactions contemplated hereby and
thereby by such Seller has been duly and validly
authorized by all necessary action on the part of such
Seller, and in the case of PNCC also has been duly and
validly authorized by the Board of Directors of PNCC, and
no other corporate proceedings on the part of PNCC are
necessary to authorize this Agreement or the Other
Documents or for PNCC to consummate the transactions
contemplated hereby and thereby. This Agreement and the
Other Documents have been duly and validly executed and
delivered by such Seller and, assuming the due
authorization, execution and delivery by the Buyer,
constitutes a legal, valid and binding obligation of such
Seller, enforceable against such Seller in accordance
with its terms. Except as set forth in Section 2.4
hereof, no power of attorney has been granted and is
currently in force by such Seller with respect to any
matter relating to Sumco or the Shares, or Sumco's
business, operations or assets.
3.3 Title to the Shares. Immediately prior to
the Closing, such Seller was the record and beneficial
owner of, and had good and marketable title to, the
number of Common Shares set forth next to such Seller's
name on Exhibit A hereto, free and clear of all
Encumbrances other than those set forth on Schedule 3.3
of the Disclosure Schedule. Except as and to the extent
set forth on Schedule 3.3 of the Disclosure Schedule such
Common Shares are not subject to any restrictions on
transferability other than those imposed by the
Securities Act and applicable state securities laws.
Except as and to the extent set forth on Schedule 3.3 of
the Disclosure Schedule, there are no options, warrants,
calls, commitments or rights of any character to purchase
or otherwise acquire Common Shares from such Seller,
under which such Seller may be obligated to sell or
transfer any of such Common Shares other than this
Agreement. At the Closing, the Buyer is acquiring good
and marketable title to such Common Shares, free and
clear of all Encumbrances.
3.4 Consents and Approvals; No Violation.
Except as and to the extent set forth on Schedule 3.4 of
the Disclosure Schedule, neither the execution and
delivery of this Agreement and the Other Documents, nor
the consummation of the transactions contemplated hereby
or thereby, nor compliance with any of the provisions
hereof, will (a) in the case of PNCC, conflict with any
provision of the Certificate of Incorporation or Bylaws
(or other similar organizational documents) of PNCC, (b)
require any consent, waiver, approval, authorization or
permit of, or filing with or notification to, or any
other action by, any Governmental Authority by such
Seller, except for filings pursuant to the applicable
requirements of the HSR Act, (c) violate any Law of any
Governmental Authority applicable to such Seller, or by
which any of such Seller's businesses, properties or
assets (including, without limitation, such Common
Shares) may be bound or affected or (d) violate, breach,
or conflict with, or constitute (with or without due
notice or lapse of time or both) a default (or give rise
to any right of termination, cancellation or acceleration
or any obligation to pay or result in the imposition of
any Encumbrance upon any of the property (including,
without limitation, such Common Shares)) under, any of
the terms, conditions or provisions of any note, bond,
mortgage, indenture, Encumbrance, Contract, Permit,
Order, or other instrument or obligation to which such
Seller is a party or by which any of such Seller's
businesses, properties or assets (including, without
limitation, such Common Shares) may be bound or affected.
3.5 Brokers. Neither the Buyer nor Sumco will
have any obligation to pay any broker's, finder's,
investment banker's, financial advisor's or similar fee
in connection with this Agreement or the Other Documents,
or the transactions contemplated hereby or thereby, by
reason of any action taken by or on behalf of such
Seller.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Management Sellers jointly and severally
represent and warrant to the Buyer as follows:
4.1 Organization and Standing of Sumco. Sumco
is a corporation duly organized and validly existing
under the laws of the State of Indiana. Sumco has all
requisite corporate power and authority to own, lease and
operate its properties and assets and to carry on its
business and operations as now being and as heretofore
been conducted. Sumco is not qualified or licensed to do
business in any jurisdiction other than the State of
Indiana, and, to the knowledge of Sumco and the
Management Sellers, the location of the property owned,
leased or operated by Sumco and the conduct of Sumco's
business and operations as now being and as heretofore
been conducted does not make such qualification in any
such other jurisdiction necessary.
4.2 Organizational Documents and Corporate
Records. (a) The Sellers have heretofore delivered to
the Buyer complete and correct copies of the Certificate
of Incorporation, Articles of Incorporation and Bylaws of
Sumco, as currently in effect, copies of which are
attached hereto as Exhibits N, O and P, respectively.
The minute books of Sumco have been made available to the
Buyer for its inspection, and, except as set forth on
Schedule 4.2 of the Disclosure Schedule, such minute
books contain complete and correct records in all
material respects of all meetings, and consents in lieu
of a meeting, of Sumco's Board of Directors (and any
committees thereof) and its shareholders since Sumco's
incorporation, and accurately reflect in all material
respects all transactions referred to therein. The stock
books and ledgers of Sumco have been made available to
the Buyer for its inspection, and such books and ledgers
are complete and correct in all material respects.
(b) The Sellers have made available to
the Buyer all of the accounting, corporate and financial
books and records (the "Accounting Books and Records")
relating to the business of Sumco in existence. Such
books and records are true, accurate and complete in all
material respects, have been maintained on a basis
consistent with past practice, and fairly reflect the
basis for Sumco's financial condition and results of
operations as set forth in the Audited Financial
Statements.
4.3 Equity Investments. Sumco does not
directly or indirectly own or control any capital stock
of or other interests or investments in any other Person
nor does Sumco have any obligation or right to acquire
any such interest or investment.
4.4 Authorization. All Corporate proceedings
on the part of Sumco which are necessary to consummate
the transactions contemplated by this Agreement and the
Other Documents have been duly authorized and taken,
including, without limitation, the authorization of the
dividend referred to in Section 2.9(ix). Except as set
forth on Schedule 4.4 of the Disclosure Schedule, no
power of attorney has been granted and is currently in
force by Sumco with respect to any matter relating to
Sumco or Sumco's business, operations or assets.
4.5 Sumco Capitalization. The capitalization
of Sumco consists of (i) 1,000 Common Shares, without par
value, 812 of which are issued and outstanding and owned
by the Sellers as set forth on Exhibit A hereto and (ii)
1,000 Non-Voting Common Shares, without par value, none
of which are issued and outstanding. Sumco has no other
class of capital stock authorized or outstanding. None
of Sumco's shares of capital stock have been reserved for
any purpose. All of the Shares are duly authorized and
validly issued, fully paid, nonassessable and were not
issued in violation of any preemptive rights. Except as
set forth on Schedule 4.5 of the Disclosure Schedule,
there are no (i) options, warrants, calls, commitments or
rights of any character to purchase or otherwise acquire
from Sumco shares of capital stock of any class,
(ii) outstanding securities of Sumco that are convertible
into or exchangeable or exercisable for shares of any
class of capital stock of Sumco, (iii) options, warrants
or other rights to purchase from Sumco any such
convertible or exchangeable securities, or (iv)
contracts, commitments, agreements, understandings or
arrangements of any kind relating to the issuance of any
capital stock of Sumco, any such options, warrants or
rights, pursuant to which, in any of the foregoing cases,
Sumco is subject or bound.
4.6 Consents and Approvals; No Violation.
Except as and to the extent set forth on Schedule 4.6 of
the Disclosure Schedule, neither the execution and
delivery of this Agreement and the Other Documents, nor
the consummation of the transactions contemplated hereby
or thereby, nor compliance with any of the provisions
hereof, will (a) conflict with any provision of the
Articles of Incorporation or Bylaws (or other similar
organizational documents) of Sumco, (b) require any
consent, waiver, approval, authorization or permit of, or
filing with or notification to, or any other action by,
any Governmental Authority by Sumco except for filings
pursuant to the applicable requirements of the HSR Act,
(c) violate any Law of any Governmental Authority
applicable to Sumco, or by which any of Sumco's business,
properties or assets may be bound or affected or (d)
violate, breach, or conflict with, or constitute (with or
without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation
or acceleration or any obligation to pay or result in the
imposition of any Encumbrance upon any of the property)
under, any of the terms, conditions or provisions of any
note, bond, mortgage, indenture, Encumbrance, Contract,
Permit, Order, or other instrument or obligation to which
Sumco is a party or by which any of Sumco's business,
properties or assets may be bound or affected.
4.7 Financial Statements. The Sellers have
previously furnished to the Buyer the audited balance
sheets of Sumco as at June 30 in each of the years 1991
through 1994 (collectively, the "Audited Balance
Sheets"), and the related statements of (i) income and
retained earnings and (ii) cash flows, for the fiscal
years then ended (together with the notes thereto),
certified by Crowe, Chizek and Company, Sumco's
independent public accountants, and accompanied by their
reports thereon (collectively, with the Audited Balance
Sheets, the "Audited Financial Statements"). The Audited
Balance Sheet of Sumco as of June 30, 1994 is hereinafter
referred to as the "1994 Balance Sheet," and the related
statements of income and retained earnings and cash flows
for the period then ended (together with the notes
thereto), certified by Crowe, Chizek and Company and
accompanied by their reports thereon are hereinafter
referred to, collectively with the 1994 Balance Sheet, as
the "1994 Financial Statements." The Audited Balance
Sheets (including the related notes thereto) (i) have
been prepared from and in accordance with the books and
records of Sumco in accordance with GAAP, and, except as
noted therein, consistently applied and maintained
throughout the periods indicated and (ii) except as set
forth on Schedule 4.7(a) of the Disclosure Schedule,
fairly present, in all respects, the assets, liabilities
and financial condition of Sumco, as at the date thereof.
The other related audited year-end statements included in
the Audited Financial Statements (including the related
notes thereto), (i) have been prepared from and in
accordance with the books and records of Sumco in
accordance with GAAP, and, except as noted therein,
consistently applied and maintained throughout the
periods indicated and (ii) fairly present, in all
respects, the results of operations and cash flows of
Sumco, for the fiscal years then ended. Except as and to
the extent set forth on Schedule 4.7(b) of the Disclosure
Schedule, the statements of income and retained earnings
and cash flows included in the Audited Financial
Statements do not contain any material items of special
or nonrecurring income not earned in the ordinary course
of business and consistent with applicable industry
standards and practice.
4.8 Absence of Undisclosed Liabilities.
Except as and to the extent set forth on Schedule 4.8(a)
of the Disclosure Schedule, to the knowledge of Sumco and
the Management Sellers, Sumco has no liabilities or
obligations arising from or relating to its business and
operations of any nature (whether absolute, accrued,
fixed, contingent, liquidated, unliquidated or otherwise
and whether due or to become due) which were not
reflected or reserved against in the 1994 Balance Sheet,
except for liabilities or obligations incurred since June
30, 1994 in the ordinary course of business and
consistent with past practice. All reserves established
by Sumco and set forth on the 1994 Balance Sheet were
determined in accordance with GAAP. Schedule 4.8(b) of
the Disclosure Schedule sets forth a true, complete and
accurate list of all liabilities or obligations of Sumco
at the Closing with respect to borrowed money, letters of
credit, and any notes, bonds or similar instruments or
under any capitalized lease of Sumco. The transfer of
the Shares will not cause the acceleration of or
otherwise adversely affect the terms or conditions of
such liabilities or obligations.
4.9 Accounts Receivable. Schedule 4.9 of the
Disclosure Schedule sets forth a true, complete and
accurate list of all Accounts Receivable together with
corresponding customer name, contact number, invoice date
and dollar amount as of September 8, 1994. All Accounts
Receivable reflected in the 1994 Balance Sheet and all
Accounts Receivable acquired or generated since June 30,
1994 by Sumco (i) arose from bona fide transactions in
the ordinary course of business consistent with past
practice, (ii) are valid and genuine, (iii) to the
knowledge of Sumco and the Management Sellers, are not
subject to any counterclaim or setoff and (iv) are not
subject to any Encumbrance. Except as and to the extent
set forth on Schedule 4.9 of the Disclosure Schedule, as
of September 8, 1994 (i) no Account Receivable has been
outstanding for more than 90 days, (ii) no Account
Receivable debtor has refused or threatened to refuse to
pay its obligations for any reason and (iii) to the
knowledge of Sumco and the Management Sellers, no Account
Receivable debtor is insolvent or is the subject of a
bankruptcy petition.
4.10 Inventory. All Owned Inventory is owned
by Sumco free and clear of any Encumbrance. All Owned
Inventory which is reflected in the 1994 Balance Sheet is
valued at the lower of cost (on a first-in, first-out
basis) or market in accordance with GAAP consistently
applied and maintained throughout the periods. Except as
and to the extent set forth on Schedule 4.10(a) of the
Disclosure Schedule, all Owned Inventory as of
September 8, 1994 consists of a quality and quantity
usable and salable as first quality goods in the ordinary
course of Sumco's business. All Inventory disposed of by
Sumco since June 30, 1994 has been disposed of only in
the ordinary course of Sumco's business and all Owned
Inventory has been disposed of at prices and under terms
that are consistent with past practice. The quantities
of all Owned Inventory are not excessive but are
reasonable and warranted under the current circumstances
of Sumco's business and operations. All work in process
and finished goods Inventory is free from any defect or
other deficiency except such defects or deficiencies
which can be corrected (i) in the ordinary course of
business consistent with past practice or (ii) without
incurring a material cost or effort to Sumco. Except as
and to the extent set forth on Schedule 4.10(b) of the
Disclosure Schedule, Sumco's assets do not include any
materials in the possession of others. The operations
records of Sumco accurately reflect the amounts and
status of all Consigned Inventory, which amounts are
consistent with the respective Contract with the
consignor of such Consigned Inventory. The Accounting
Books and Records are consistent with the operations
records of Sumco as to the Consigned Inventory. The
Consigned Inventory has not been encumbered, sold or
transferred in violation of any Contract with a consignor
of such Consigned Inventory.
4.11 Absence of Certain Changes or Events.
Except as and to the extent set forth on Schedule 4.11 of
the Disclosure Schedule, since June 30, 1994:
(i) Sumco has operated its
business in the ordinary course consistent with
past practice;
(ii) there has not been any
material adverse change in the business,
results of operations, assets, liabilities,
financial condition or, to the knowledge of
Sumco and the Management Sellers, and except
for matters which apply to United States'
businesses generally, any material adverse
change in the prospects of Sumco;
(iii) Sumco has not incurred
any material damage, destruction or loss
(whether or not covered by insurance) to its
owned or leased property or assets;
(iv) Sumco has not transferred,
licensed, sublicensed, disposed of, abandoned
or permitted to lapse or otherwise failed to
preserve any material rights to use any
Intellectual Property or disclosed to any
Person, other than authorized representatives
of the Buyer, any Intellectual Property not in
the public domain relating to Sumco's business
or operations;
(v) Sumco has not transferred,
disposed of, abandoned or permitted to lapse or
otherwise failed to preserve any Permit or
other form of authorization issued by a
Governmental Authority;
(vi) Sumco has not sold,
assigned, leased, transferred, incurred any
Encumbrance on or license with respect to, or
disposed of, abandoned, or conveyed any of its
properties or assets (whether real, personal or
mixed, tangible or intangible), except in the
ordinary course of business consistent with
past practice;
(vii) Sumco has not canceled
any debts or claims, or waived any rights of
substantial value;
(viii) Sumco has not made, or
committed to make, any capital expenditures
except capital expenditures made in the
ordinary course of business consistent with
past practice, which capital expenditures in
the aggregate do not exceed $100,000.
(ix) Sumco has not incurred any
liabilities or obligations (whether absolute,
accrued or contingent, for borrowed money or
otherwise, and whether due or to become due)
except liabilities or obligations incurred in
the ordinary course of business consistent with
past practice, which liabilities and
obligations in the aggregate do not exceed
$150,000;
(x) Sumco has not paid,
discharged or satisfied any Encumbrance or
liability (whether absolute, accrued,
contingent or otherwise and whether due or to
become due), other than Encumbrances or
liabilities which are reflected or reserved
against in the 1994 Balance Sheet or incurred
thereafter in the ordinary course of business
consistent with past practice and which were
paid, discharged or satisfied in the ordinary
course of business consistent with past
practice;
(xi) Sumco has not (a) entered
into any employment, deferred compensation,
retention, consulting or similar agreement, (b)
granted or promised any bonus or severance
payment to any director, officer, employee,
distributor, independent contractor or agent of
Sumco, (c) created any additional Plan or
modified or amended any existing Plan (whether
or not such Plan would increase the benefit
obligation to any director, officer, employee,
distributor, independent contractor or agent of
Sumco), or (d) granted or promised any increase
in the rates or terms of compensation,
conditionally or otherwise, including, without
limitation, any commission, bonus, pension,
severance or vacation pay, employee welfare or
benefit payment or other direct or indirect
remuneration, in each case to any director,
officer, employee, distributor, independent
contractor or agent of Sumco;
(xii) Sumco has not declared,
paid or made or set aside for payment or
making, any dividend or other payment or
distribution of any kind in respect of its
capital stock or other securities, or to its
securityholders (other than salary and
benefits), or directly or indirectly retired,
redeemed, purchased or otherwise acquired any
of its Common Shares or other securities;
(xiii) Sumco has not issued,
authorized or proposed the issuance of,
reclassified, or sold any shares of capital
stock of Sumco, of securities convertible into
or exchangeable or exercisable for, or rights,
warrants or options to acquire, any such shares
or other convertible securities or acquired any
capital stock or other securities or interests
of any Person, or otherwise made a loan or
advance to or investment in any Person;
(xiv) Sumco has not made any
change in any accounting methods, principles or
practices (including, without limitation,
changes in depreciation or amortization
policies or rates or relating to the
establishment of accrual of reserves) or any
material election with respect to Taxes;
(xv) Sumco has not paid, loaned
or advanced any amount to or in respect of, or
sold, transferred or leased any properties or
assets (whether real, personal or mixed,
tangible or intangible) to, or entered into any
agreement, arrangement or transaction with, any
of the Sellers or any of the Sellers'
Affiliates, other than salary, bonus and
benefits paid to the Management Sellers in the
ordinary course of business consistent with
past practice;
(xvi) Sumco has not entered
into any lease, as lessor or lessee, of real or
personal property involving the expenditure of
more than $5,000, individually, or $20,000, in
the aggregate, on a monthly basis;
(xvii) Sumco has not (a)
entered into any Material Contract, (b)
terminated or amended, breached, or failed to
perform in all material respects all of its
obligations under, any Contract, and to the
knowledge of Sumco and the Management Sellers,
no other party thereto has terminated or
amended, breached, or failed to perform in all
material respects all of its obligations under,
any Contract;
(xviii) Sumco has not issued
any warranties, express, implied or otherwise,
with respect to any products or services
created, sold or licensed by Sumco, except in
the ordinary and usual course of business
consistent with past practice (including those
imposed by applicable Law);
(xix) Sumco has not experienced
any actual or, to the knowledge of Sumco and
the Management Sellers, threatened employee
strikes, disputes, work stoppages, slow-downs
or lock-outs, or had any material change in its
relationship with its employees, salesmen,
distributors, or independent contractors;
(xx) Sumco has not failed to
replenish its inventories and supplies in a
normal and customary manner consistent with
past practice and Sumco has not made any
purchase commitment, except in the ordinary
course of business consistent with past
practice;
(xxi) Sumco has not changed any
of its significant business policies;
(xxii) Sumco has not
instituted, settled or agreed to settle any
litigation, action or proceeding before any
Governmental Authority; or
(xxiii) Sumco has not agreed,
whether in writing or otherwise, to take any
action described in this Section 4.11.
4.12 Properties and Assets.
(a) Sumco has good, valid, marketable and
fee simple title to all of the real property owned by
Sumco as more particularly described on Schedule 4.12(a)
of the Disclosure Schedule (the "Real Property"). Except
as set forth on Schedule 4.12(b) of the Disclosure
Schedule, the Real Property is subject to no Encumbrance,
encroachment, building or use restriction (except for
statutes, codes and ordinances of general applicability,
including building codes and zoning ordinances), zoning
violation, exception, reservation or limitation.
(b) Sumco has not received any written
notice or communication advising it of any general or
special assessment relating to the Real Property which is
not fully paid or which is not specifically disclosed in
the Title Policy or otherwise set forth on Schedule
4.12(c) of the Disclosure Schedule. To the knowledge of
Sumco and the Management Sellers, there are no plans by
any Governmental Authority which may result in the
imposition of any special assessment relating to the Real
Property. There are no condemnation or eminent domain
proceedings pending for which notice has been provided to
Sumco or, to the knowledge of Sumco and the Management
Sellers, threatened against the Real Property by any
Governmental Authority. There are no variances, special
exceptions, conditions or agreements pertaining to the
Real Property imposed or granted by or entered into by
Sumco, with or enforceable by any Governmental Authority,
except as and to the extent set forth in Schedule 4.12(d)
of the Disclosure Schedule. No written notice from any
Governmental Authority has been provided to Sumco or the
Management Sellers requiring or calling attention to the
need for any work, repair, construction, alteration or
installation on, or in connection with, the Real
Property. The Real Property is connected to sanitary
sewer, storm sewer, water, electricity, gas, telephone
and all other utilities necessary for the operations of
Sumco as currently conducted and neither Sumco nor the
Management Sellers have knowledge of any existing
circumstances or conditions which would result in
termination of such access or connections for any
significant period of time.
(c) Except as and to the extent set forth
on Schedule 4.12(e) of the Disclosure Schedule, Sumco has
good, valid and marketable title to all items of personal
property, buildings, improvements, equipment and all
other assets and properties (whether personal or mixed,
tangible or intangible (and whether or not fully
depreciated or expensed)) used in its business and
operations, and such items are subject to no Encumbrance
other than those set forth on Schedule 4.12(f) of the
Disclosure Schedule. Except as and to the extent set
forth on Schedule 4.12(g) of the Disclosure Schedule, all
buildings, improvements, equipment or other material
assets currently used in connection with the business and
operations of Sumco are structurally sound with no known
material defects. Except as and to the extent set forth
on Schedule 4.12(h) of the Disclosure Schedule, none of
such improvements, equipment or other assets are subject
to any commitment or other arrangement for their sale or
use by any third party.
4.13 Certain Contracts. Schedule 4.13(a) of
the Disclosure Schedule sets forth a complete and correct
list of all Material Contracts as of the Closing.
Complete and correct copies of all written Contracts
including any and all amendments and other modifications
thereto have been delivered to or have been made
available for inspection by the Buyer. All written
Contracts and all oral Material Contracts (x) are valid
and binding obligations of Sumco and, to the knowledge of
Sumco and the Management Sellers, the other parties
thereto, (y) are in full force and effect and are
enforceable as to Sumco and, to the knowledge of Sumco
and the Management Sellers, the other parties thereto, in
accordance with their respective terms, and (z) have not
been amended or terminated except in the ordinary course
of business consistent with past practice. Sumco is not
in default under nor has it breached in any respect any
Contract. The aggregate obligations of Sumco with
respect to oral Contracts which do not constitute
Material Contracts do not exceed $50,000. No other party
to any Contract (i) has, to the knowledge of Sumco and
the Management Sellers, breached or is in default
thereunder, (ii) has given notice that it intends to
terminate such Contract or (iii) has altered, in any way
adverse to Sumco, its performance under such Contract.
No event or condition has occurred (or is alleged by any
other party to a Contract to have occurred) which, with
or without due notice or lapse of time or both, would
constitute a breach or event of default on the part of
Sumco, would provide a basis for a valid claim or
acceleration under any Contract as against Sumco or would
prevent Sumco from exercising and obtaining the full
benefits of any rights or options contained therein. Any
Contract which by its terms requires the consent,
approval or action of a Governmental Authority or any
other Person before becoming effective is, as of the date
hereof, effective.
4.14 Compliance with Laws and Permits. (a)
Except as and to the extent set forth on Schedule 4.14(a)
of the Disclosure Schedule, the business and operations
of Sumco have been conducted and are now being conducted
in all material respects in compliance with all Laws and
Orders of all Governmental Authorities having
jurisdiction over Sumco and all Permits relating to any
of its properties or applicable to its business.
(b) Except as and to the extent set forth
on Schedule 4.14(b) of the Disclosure Schedule, Sumco
possesses all Permits necessary to own and operate its
property and assets and to conduct its business as it is
currently conducted. Such Permits are valid, subsisting
in full force and effect, and Sumco has fulfilled its
obligations under each of the Permits, and no event has
occurred or condition or state of facts exists which
constitutes or, after notice or lapse of time or both,
would constitute a default or violation under any of the
Permits or would permit revocation or termination of any
of the Permits. In respect of any such Permits, no
proceeding is pending for which notice has been provided
to Sumco or, to the knowledge of Sumco and the Management
Sellers, threatened looking toward revocation or
termination of any such Permits.
4.15 Litigation and Arbitration. (a) Except
as and to the extent set forth on Schedule 4.15(a) of the
Disclosure Schedule, no claim, action, cause of action,
suit, proceeding, inquiry, investigation or Order has
been initiated, brought or commenced, or was pending (for
which notice has been provided to Sumco), since the date
of Sumco's incorporation against Sumco or affecting its
business, operations or assets. Except as set forth on
Schedule 4.15(b) of the Disclosure Schedule, there are no
legal, administrative, arbitration or other claims,
actions, causes of action, suits, proceedings, inquiries,
investigations or Orders pending (for which notice has
been provided to Sumco), or, to the knowledge of Sumco
and the Management Sellers, threatened before any
Governmental Authority, arbitration or mediation panel or
similar body against Sumco or affecting its business,
operations or assets, nor is there any Order of any
Governmental Authority, arbitrator or mediator
outstanding against Sumco, its business, operations or
assets. Neither Sumco nor any of the Management Sellers
has knowledge of any fact or circumstance which could
reasonably be expected to result in any other claim,
action, cause of action, suit, proceeding, inquiry,
investigation or Order against Sumco or affecting its
business, operations or assets.
(b) No claim, action, suit, proceeding,
inquiry or investigation has been instituted (for which
Sumco has received notice) or, to the knowledge of Sumco
and the Management Sellers, threatened to restrain or
prohibit or otherwise challenge the legality or validity
of the transactions contemplated by this Agreement or the
Other Documents.
4.16 Employee Matters. (a) Schedule 4.16(a)
of the Disclosure Schedule sets forth a complete and
accurate list of the names, titles and annual
compensation (including any bonuses paid in respect of
the fiscal year ending June 30, 1994) of all directors,
officers and employees of Sumco, and all Family
Relationships among such persons, as of the Closing.
(b) Schedule 4.16(b) of the Disclosure
Schedule sets forth a complete and correct list of each
employment bonus, deferred compensation, incentive
compensation, stock purchase, stock option, severance or
termination pay, hospitalization or other medical, life
or other insurance, supplemental unemployment benefits,
profit-sharing, pension, or retirement plan, program,
agreement or arrangement, and each other employee benefit
plan within the meaning of Section 3(3) of ERISA,
sponsored, maintained or contributed to or required to be
contributed to by Sumco or, to the knowledge of Sumco and
the Management Sellers, by any trade or business, whether
or not incorporated (an "ERISA Affiliate"), that together
with Sumco would be deemed a "single employer" within the
meaning of Section 4001 of ERISA, for the benefit of any
employee or terminated employee of Sumco or any ERISA
Affiliate, whether formal or informal and whether legally
binding or not (the "Plans"). Schedule 4.16(c) of the
Disclosure Schedule identifies each of the Plans that is
an "employee benefit plan," as such term is defined in
Section 3(3) of ERISA (such plans being hereinafter
referred to collectively as the "ERISA Plans"). Neither
Sumco nor any ERISA Affiliate has any formal plan or
commitment, whether legally binding or not, to create any
additional Plan or modify or change any existing Plan
that would affect any employee or terminated employee of
Sumco or any ERISA Affiliate.
(c) Except as set forth on Schedule
4.16(d), with respect to each Plan, Sumco has heretofore
delivered to Buyer complete and correct copies of each of
the following documents:
(i) a copy of the Plan
(including all amendments thereto);
(ii) a copy of the annual
report, if required under ERISA, with respect
thereto for the last two years;
(iii) a copy of the actuarial
report, if required under ERISA, with respect
thereto for the last two years;
(iv) a copy of the most recent
report prepared with respect thereto in
accordance with Statement of Financial
Accounting Standards No. 87, Employer's
Accounting for Pensions;
(v) a copy of the most recent
Summary Plan Description, together with each
Summary of Material Modifications, required
under ERISA with respect thereto and all
material written communications to employees or
former employees with respect thereto;
(vi) if the Plan is funded
through a trust or any third party funding
vehicle, a copy of the trust or other funding
agreement (including all amendments thereto)
and the latest financial statements thereof; and
(vii) the most recent
determination letter received from the Internal
Revenue Service with respect to each Plan that
is intended to be qualified under Section 401
of the Code.
(d) No "reportable event" (as defined in
accordance with ERISA Section 4043) has occurred with
respect to any ERISA Plan. No liability under Title IV
of ERISA has been incurred by Sumco or any ERISA
Affiliate since the incorporation of Sumco that has not
been satisfied in full, and no condition exists that
presents a material risk to Sumco or any ERISA Affiliate
of incurring a liability under such Title, other than
liability for premiums due the Pension Benefit Guaranty
Corporation ("PBGC") which premiums have been paid when
due. To the extent this representation applies to
Sections 4064, 4069 or 4204 of Title IV of ERISA, it is
made not only with respect to each ERISA Plan but also
with respect to any employee benefit plan, program,
agreement or arrangement subject to Title IV of ERISA to
which Sumco or any ERISA Affiliate made, or was required
to make, contributions during the past five years.
(e) The PBGC has not instituted
proceedings to terminate any ERISA Plan, for which notice
has been provided to Sumco, and, to the knowledge of
Sumco and the Management Sellers, no condition exists
that presents a material risk that such proceedings will
be instituted.
(f) With respect to each ERISA Plan which
is subject to Title IV of ERISA, the projected benefit
obligation (as calculated by the Plan's actuaries in
accordance with Financial Accounting Standard No. 87) as
of June 30, 1994, does not exceed the fair value of Plan
assets (as calculated by the Plan's actuaries in
accordance with Financial Accounting Standard No. 87) as
of June 30, 1994, by more than $456,058, and since July
1, 1994, there has not been a material change in the
Plan's unfunded projected benefit obligation.
(g) Neither Sumco, nor to the knowledge
of Sumco and the Management Sellers, any ERISA Affiliate,
nor any ERISA Plan, nor any trust created thereunder, nor
any trustee or administrator thereof has engaged in a
transaction in connection with which Sumco or any ERISA
Affiliate, any ERISA Plan, any such trust, or any trustee
or administrator thereof, or any party dealing with any
ERISA Plan or any such trust could be subject to either a
civil penalty assessed pursuant to Section 409 or 502(i)
of ERISA or a tax imposed pursuant to Section 4975 or
4976 of the Code.
(h) Full payment has been made in
accordance with Section 404(a)(6) of the Code, of all
amounts which Sumco or any ERISA Affiliate is required to
pay under the terms of each ERISA Plan as of the last day
of the most recent plan year thereof ended prior to the
date hereof; and no ERISA Plan or any trust established
thereunder has incurred any "accumulated funding
deficiency" (as defined in Section 302 of ERISA and
Section 412 of the Code), whether or not waived, as of
the last day of the most recent fiscal year of each ERISA
Plan ended prior to the date hereof; and all
contributions required to be made with respect thereto
(whether pursuant to the terms of any ERISA Plan or
otherwise) on or prior to the Closing have been timely
made.
(i) No ERISA Plan is a "multiemployer
plan," as such term is defined in Section 3(37) of ERISA,
nor is any ERISA Plan a plan described in Section 4063(a)
of ERISA.
(j) Except as and to the extent set forth
on Schedule 4.16(f) of the Disclosure Schedule, each Plan
has been operated and administered in all material
respects in accordance with its terms and applicable law,
including but not limited to ERISA and the Code and the
rules and regulations promulgated thereunder.
(k) Each ERISA Plan which is intended to
be "qualified" within the meaning of Section 401(a) of
the Code is so qualified and the trusts maintained
thereunder are exempt from taxation under Section 501(a)
of the Code.
(l) No amounts payable under the Plans
will fail to be deductible for federal income tax
purposes by virtue of Section 280G of the Code.
(m) No "leased employee," as that term is
defined in Section 414(n) of the Code, performs services
for Sumco or any ERISA Affiliate.
(n) Except as and to the extent set forth
on Schedule 4.16(f) of the Disclosure Schedule, no Plan
provides benefits, including without limitation death or
medical benefits (whether or not insured), with respect
to current or former employees of Sumco or any ERISA
Affiliate beyond their retirement or other termination of
service (other than (i) coverage mandated by applicable
law, (ii) death benefits or retirement benefits under any
"employee pension plan," as that term is defined in
Section 3(2) of ERISA, (iii) deferred compensation
benefits accrued as liabilities on the books of Sumco or
the ERISA Affiliates or (iv) benefits the full cost of
which is borne by the current or former employee (or his
beneficiary).
(o) The consummation of the transactions
contemplated by this Agreement will not (i) entitle any
current or former employee or officer of Sumco or any
ERISA Affiliate to severance pay, unemployment
compensation or any other payment, except as expressly
provided herein, (ii) accelerate the time of payment or
vesting, or increase the amount of compensation due any
such employee or officer or (iii) result in any
prohibited transaction described in Section 406 of ERISA
or Section 4975 of the Code for which an exemption is not
available.
(p) With respect to each Plan that is
funded wholly or partially through an insurance policy,
to the knowledge of Sumco and the Management Sellers,
there will be no liability of Sumco or any ERISA
Affiliate, as of the Closing, under any such insurance
policy or ancillary agreement with respect to such
insurance policy in the nature of a retroactive rate
adjustment, loss sharing arrangement or other actual or
contingent liability arising wholly or partially out of
events occurring prior to the Closing.
(q) There are no pending (for which
notice has been provided), to the knowledge of SUMCO and
the Management Sellers, threatened or anticipated claims
by or on behalf of any Plan, by any employee or
beneficiary covered under any such Plan, or otherwise
involving any such Plan (other than routine claims for
benefits).
(r) No ERISA Plan, whether or not
terminated, holds, or has discharged any of its
liabilities through the acquisition of, any annuity
contract.
4.17 Labor Relations. (a) Except as and to
the extent set forth on Schedule 4.17(a) of the
Disclosure Schedule, (i) there is no labor strike,
dispute, slowdown, stoppage or lockout actually pending
(for which notice has been provided), or to the knowledge
of Sumco and the Management Sellers, threatened against
or affecting the business and operations of Sumco, and
since Sumco's incorporation there has not been any such
action; (ii) Sumco is not a party to or bound by any
collective bargaining or similar agreement with any labor
organization, or work rules or practices agreed to with
any labor organization or employee association applicable
to employees of Sumco; (iii) to the knowledge of Sumco
and the Management Sellers, no employee of Sumco is
represented by any labor organization and no current
union organizing activities among the employees of Sumco
exists, and no question exists concerning the
representation of such employees; (iv) there are no
material written personnel policies, rules or procedures
applicable to employees of Sumco, other than those set
forth on Schedule 4.17(a) of the Disclosure Schedule,
complete and accurate copies of which have heretofore
been delivered to the Buyer; (v) Sumco has at all times
been in material compliance with all applicable Laws in
respect of employment and employment practices, terms and
conditions of employment, wages, hours of work and
occupational safety and health, and is not engaged in any
unfair labor practices as defined in the National Labor
Relations Act; (vi) there is no unfair labor practice
charge or complaint against Sumco pending (for which
notice has been provided) or, to the knowledge of Sumco
and the Management Sellers, threatened before the
National Labor Relations Board or any similar state or
foreign agency; (vii) since Sumco's incorporation there
have been no arbitration proceedings or material
grievance proceedings arising out of any collective
bargaining agreement; (viii) to the knowledge of Sumco
and the Management Sellers, no charges with respect to or
relating to Sumco are pending before the Equal Employment
Opportunity Commission or any other agency responsible
for the prevention of unlawful employment practices; (ix)
to the knowledge of Sumco and the Management Sellers,
Sumco has not received notice of the intent of any
Governmental Authority responsible for the enforcement of
labor or employment Laws to conduct an investigation with
respect to or relating to Sumco and no such investigation
is in progress; and (x) to the knowledge of Sumco and the
Management Sellers, there are no complaints, lawsuits or
other proceedings pending or threatened in any forum by
or on behalf of any present or former employee of Sumco,
any applicant for employment or classes of the foregoing
alleging breach of any express or implied contract of
employment, any Law governing employment or the
termination thereof or other discriminatory, wrongful or
tortious conduct in connection with the employment
relationship.
(b) Since Sumco's incorporation, Sumco
has not effectuated (i) a "plant closing" (as defined in
the Warn Act) affecting any site of employment or one or
more facilities or operating units within any site of
employment or facility of Sumco; or (ii) a "mass layoff"
(as defined in the Warn Act) affecting any site of
employment or facility of Sumco; nor has Sumco been
affected by any transaction or engaged in layoffs or
employment terminations sufficient in number to trigger
application of any similar state or local Law. Except as
and to the extent set forth on Schedule 4.17(b) of the
Disclosure Schedule, none of Sumco's employees has
suffered an "employment loss" (as defined in the Warn
Act) since February 1, 1994.
4.18 Taxes. (a) Sumco has duly and timely
filed all Tax Returns required to be filed by it on or
before the Closing Date, as well as the Income Tax
Returns of Sumco for the fiscal year ended June 30, 1994,
and all such Tax Returns are complete and correct in all
material respects.
(b) Except as and to the extent set forth
on Schedule 4.18 of the Disclosure Schedule, Sumco has
timely paid all Taxes due or claimed to be due from it by
any taxing authority.
(c) Except as and to the extent set forth
on Schedule 4.18 of the Disclosure Schedule, Sumco has
complied in all respects with all applicable Laws
relating to the payment and withholding of Taxes
(including, without limitation, withholding of Taxes
pursuant to Sections 1441 and 1442 of the Code or similar
provisions under any foreign laws) and has, within the
time and within the manner prescribed by Law, withheld
from employee wages and paid over to the proper
Governmental Authorities all amounts required to be
withheld and paid over under all applicable Laws.
(d) There are no Encumbrances for Taxes
upon Sumco's assets except for statutory liens for
current Taxes not yet due.
(e) Sumco has not requested any extension
of time within which to file any Tax Return in respect of
any fiscal year which has not since been filed. Except
as and to the extent set forth on Schedule 4.18 of the
Disclosure Schedule, there are no outstanding waivers or
comparable consents regarding the application of the
statute of limitations with respect to any Taxes or Tax
Returns that has been given by Sumco.
(f) Except as and to the extent set forth
on Schedule 4.18 of the Disclosure Schedule, no federal,
state, local or foreign audits or other administrative
proceedings or court proceedings are presently pending
(for which notice has been provided to Sumco) with regard
to any Taxes or Tax Returns of Sumco.
(g) Sumco is not required to include in
income any adjustment pursuant to Section 481(a) of the
Code, by reason of a voluntary change in accounting
method (nor has any taxing authority proposed in writing
to Sumco any such adjustment or change of accounting
method).
(h) Sumco is not a party to, is not bound
by, nor has any obligation under, any Tax sharing
agreement or similar contract or arrangement.
(i) Except as and to the extent set forth
on Schedule 4.18 of the Disclosure Schedule, no power of
attorney has been granted by Sumco with respect to any
matter relating to Taxes which is currently in force.
(j) Sumco has not filed a consent
pursuant to Section 341(f) of the Code or agreed to have
Section 341(f)(2) of the Code apply to any disposition of
a subsection (f) asset (as such term is defined in
Section 341(f)(4) of the Code) owned by Sumco.
(k) Except as and to the extent set forth
on Schedule 4.18 of the Disclosure Schedule, Sumco is not
a party to any agreement, contract, or arrangement that
will result, separately or in the aggregate, in the
payment of any "excess parachute payments" within the
meaning of Section 280G of the Code.
(l) None of the income recognized for
federal, state, local or foreign Income Tax purposes by
Sumco during the period beginning from July 1, 1994 to
the date hereof will be derived other than in the
ordinary course of business.
4.19 Intellectual Property. (a) Schedule
4.19(a) of the Disclosure Schedule contains a complete
and correct list of all: (i) patents and patent
applications, (ii) registered copyrights, copyright
applications and material unregistered copyrights
(including any such copyrights in proprietary computer
software and databases), and (iii) trademarks, service
marks, tradenames, logos and material trade dress,
including, in each case, all registrations thereof and
applications therefor, owned by Sumco. Schedule 4.19(b)
of the Disclosure Schedule sets forth each agreement
pertaining to the use of Intellectual Property in Sumco's
business and operations listing, in each case, whether
Sumco is the licensor or licensee thereunder, the subject
matter of the license, and whether the rights granted are
exclusive or non-exclusive (the "License Agreements").
(b) Sumco owns or, to the knowledge of
Sumco and the Management Sellers, has the right to use
all Intellectual Property used in or necessary to conduct
its business as currently conducted, in each case without
the payment of any royalties except under the agreements
set forth on Schedule 4.19(b) of the Disclosure Schedule.
Sumco is the sole and exclusive owner of the Intellectual
Property set forth on Schedule 4.19(a) of the Disclosure
Schedule, free and clear of all Encumbrances except as
set forth on Schedule 4.19(c) of the Disclosure Schedule.
All applications and registrations for the Intellectual
Property set forth on Schedule 4.19(a) of the Disclosure
Schedule stand in the name of Sumco. The Intellectual
Property set forth on Schedule 4.19(a) of the Disclosure
Schedule has not lapsed, expired or been abandoned and,
to the knowledge of Sumco and the Management Sellers, is
valid and enforceable. No application or registration
therefor is the subject of any opposition or cancellation
proceeding before any registration authority in any
jurisdiction for which notice has been provided to Sumco
or, to the knowledge of Sumco and the Management Sellers,
is any such proceeding threatened.
(c) To the knowledge of Sumco and the
Management Sellers, the activities and products of Sumco
do not infringe upon the Intellectual Property rights of
any other Person. There are no claims or suits pending
for which notice has been provided or, to the knowledge
of Sumco and the Management Sellers, threatened (i)
alleging that Sumco's activities or products infringe
upon or constitute the unauthorized use of a third
party's Intellectual Property rights or (ii) challenging
Sumco's ownership of, right to use, or the validity or
enforceability of any Intellectual Property owned or used
by Sumco. To the knowledge of Sumco and the Management
Sellers, there are no infringements by third parties of
any Intellectual Property owned by Sumco. Sumco has not
entered into any consent, indemnification, forbearance to
sue, or settlement agreement with any third party
relating to Intellectual Property.
(d) The License Agreements constitute
binding obligations of Sumco, and Sumco is not in breach
of or default under the License Agreements nor has an
event or condition occurred (or is alleged by any other
party to have occurred) which, with or without due notice
or lapse of time or both, would constitute a breach or
event of default on the part of Sumco or would provide a
basis for a valid claim, acceleration or termination by
any other party under the License Agreements. To the
knowledge of Sumco and the Management Sellers, no other
party is in breach of or default under the License
Agreements nor has any event or condition occurred (or is
alleged by any other party to have occurred) which, with
or without due notice or lapse of time or both, would
constitute a breach or event of default on the part of
such other party under the License Agreements. The
consummation of the transactions contemplated by this
Agreement and the Other Documents will not result in the
loss or impairment of any of Sumco's rights in the
Intellectual Property used in or necessary to conduct its
business as currently conducted or in the License
Agreements.
4.20 Environmental Matters. Except as and to
the extent set forth on Schedule 4.20(a) of the
Disclosure Schedule:
(a) Sumco is and has been in compliance
with, and there are no outstanding allegations (for which
Sumco has been provided notice) by any Person that Sumco
is not or has not been in compliance with, all applicable
Laws relating to pollution, the preservation of the
environment and the discharge or release of Hazardous
Materials into the environment or workplace
("Environmental Laws").
(b) All Permits held by Sumco under
Environmental Laws ("Environmental Permits") are set
forth on Schedule 4.20(b) of the Disclosure Schedule.
Sumco has not been notified by any Governmental Authority
that, and Sumco and the Management Sellers have no
knowledge that, any Environmental Permit may be modified,
suspended or revoked, or that any Environmental Permit
has not been timely reapplied for by Sumco, or to the
knowledge of Sumco and the Management Sellers, cannot be
renewed, transferred or otherwise obtained by the Buyer
in the ordinary course of business.
(c) There are no Orders, claims or
demands or investigations pending (for which Sumco has
been provided notice) or, to the knowledge of Sumco and
the Management Sellers, threatened against Sumco relating
to any alleged violation of Environmental Laws, or to any
potential liability relating to the alleged discharge,
release or threatened release of materials into the
environment or workplace, and to the knowledge of Sumco
and the Management Sellers, there are no acts, conditions
or circumstances (including, without limitation,
contractual provisions and the existence of corporate
predecessors) that could reasonably be expected to give
rise to such Orders, claims, demands or investigations in
the future.
(d) With respect to the Real Property:
(i) to the knowledge of Sumco and the Management Sellers,
no friable asbestos contained in or forming part of any
building, building component, structure of office space;
(ii) to the knowledge of Sumco and the Management
Sellers, no polychlorinated biphenyls or urea
formaldehyde foam insulation is present; and (iii) no
underground storage tanks are present.
(e) Schedule 4.20(c) of the Disclosure
Schedule sets forth a complete and correct list of all
Contracts pursuant to which Sumco has indemnified or has
agreed to indemnify any other Person for any liability
under, or violation of, Environmental Laws.
4.21 Insurance. Schedule 4.21(a) of the
Disclosure Schedule sets forth a complete and correct
list as of the Closing of all primary, excess and
umbrella policies, bonds and other forms of insurance,
and renewals thereof, owned or held by or on behalf of or
providing insurance coverage to or for the benefit of
Sumco, copies of which have previously been provided to
the Buyer. All of such insurance policies are in full
force and effect, all premiums currently payable or
previously due have been paid, no notice of cancellation
or termination has been received with respect to any such
policy and no assignment of proceeds or Encumbrance
exists with respect to the proceeds of any such policy.
Except as and to the extent set forth on Schedule 4.21(b)
of the Disclosure Schedule, there are no pending claims
against such policies. To the knowledge of Sumco and the
Management Sellers, all such policies will remain in full
force and effect upon execution and delivery of this
Agreement and the Other Documents and the consummation of
the transactions contemplated hereby and thereby.
4.22 Bank Accounts. Schedule 4.22 of the
Disclosure Schedule sets forth a complete and correct
list of (i) the names and locations of all financial
institutions at which Sumco maintains a checking account,
deposit account, securities account, safety deposit box
or other deposit or safekeeping arrangement, (ii) the
number or other identification of all such accounts and
arrangements and (iii) the names of all persons
authorized to draw thereon or have access thereto.
4.23 Customers and Suppliers. Schedule 4.23(a)
of the Disclosure Schedule sets forth a complete and
correct list of (i) the names of the ten largest
customers (by revenues generated) of Sumco and the amount
of revenues generated by each such customer in Sumco's
fiscal year ended June 30, 1994 and (ii) the names of
suppliers to whom Sumco paid more than $50,000 in Sumco's
fiscal year ended June 30, 1994 and the approximate total
purchases by Sumco from each such supplier during such
year. Except as and to the extent set forth on Schedule
4.23(b) of the Disclosure Schedule, there have been no
adverse changes in the relationships between Sumco and
its customers and suppliers since January 1, 1994. Sumco
has not been provided with any notice that any supplier,
manufacturer or customer intends to cease doing business
with Sumco. To the knowledge of Sumco and the Management
Sellers, there are no facts or circumstances (including,
without limitation, the transactions contemplated by this
Agreement and the Other Documents) that could reasonably
be expected to have an adverse affect on Sumco's
relationships with its customers, suppliers and
manufacturers.
4.24 Warranties; Returns and Cancellations.
(a) Schedule 4.24(a) of the Disclosure Schedule sets
forth a complete and correct list of all express
warranties with respect to any products or services
created, sold, distributed or licensed by Sumco. Except
as and to the extent set forth on Schedule 4.24(a) of the
Disclosure Schedule, there are no express or implied
warranties outstanding with respect to any products or
services created, sold, distributed or licensed by Sumco
(other than those imposed by applicable Law).
(b) There are no claims to returns or
trial use arrangements or price allowances or similar
disputes for products shipped by Sumco on or prior to the
Closing Date which will result in $140,000, in the
aggregate, of costs and expenses (on a net basis) to
Sumco by reason of alleged overshipments, defective or
unsatisfactory products or equipment, the expiration of
trial use arrangements or otherwise. There is no product
or equipment of Sumco in the hands of customers under an
understanding that such product or equipment would be
returnable other than pursuant to the standard return
policy set forth in Sumco's forms of invoice and
quotation form. To the knowledge of Sumco and the
Management Sellers, the execution and delivery of this
Agreement and the Other Documents, and the consummation
of the transactions contemplated hereby or thereby will
not result in any cancellations or withdrawals of any
accepted and unfilled orders for the sale, license, lease
or other transfer of products or equipment.
4.25 Affiliate Transactions. Schedule 4.25 of
the Disclosure Schedule sets forth a correct and complete
list of all arrangements or transactions (other than
salary, bonus and benefits generally available to the
employees of Sumco) between Sumco and the Sellers or any
affiliate or associate of the Sellers, or any business or
entity in which the Sellers or any affiliate or associate
of any of the Sellers, has any direct or indirect
interest (the "Sellers' Affiliates"), that involves an
obligation or commitment on the part of or for the
benefit of Sumco or such Sellers' Affiliate of more than
$1,000 in any calendar year (the "Affiliate
Transactions").
4.26 Brokers. Neither the Buyer nor Sumco has
or will have any obligation to pay any broker's,
finder's, investment banker's, financial advisor's or
similar fee in connection with this Agreement or the
Other Documents, or the transactions contemplated hereby
or thereby, by reason of any action taken by or on behalf
of the Sellers or Sumco.
4.27 Disclosure. The Sellers have not
knowingly failed to disclose to the Buyer any facts
material to Sumco's business, results of operations,
assets, liabilities, financial condition and prospects.
No representation or warranty by the Sellers in this
Agreement and no statement by the Sellers in any Other
Document (including the Schedules of the Disclosure
Schedule), contains any untrue statement of a material
fact or omits to state any material fact necessary, in
order to make the statements made herein or therein, in
light of the circumstances under which they were made,
not misleading.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the
Sellers as follows:
5.1 Organization and Standing. The Buyer is a
corporation duly organized, validly existing and in good
standing under the laws of the State of New York. The
Buyer has all requisite corporate power and authority to
own, lease and operate its properties and assets and to
carry on its business and operations as it is now being
conducted.
5.2 Authorization; Binding Obligation. The
Buyer has all requisite corporate power and authority to
execute and deliver this Agreement and the Other
Documents and to consummate the transactions contemplated
hereby and thereby and to perform its obligations
hereunder and thereunder. The execution and delivery of
this Agreement and the Other Documents by the Buyer and
the consummation of the transactions contemplated hereby
and thereby by the Buyer have been duly and validly
authorized by the Board of Directors of the Buyer and no
other corporate proceedings on the part of the Buyer are
necessary to authorize this Agreement or the Other
Documents or to consummate the transactions contemplated
hereby or thereby. This Agreement and the Other
Documents have been validly executed and delivered by the
Buyer and, assuming the due authorization, execution and
delivery by the Sellers, constitutes legal, valid and
binding obligations of the Buyer, enforceable against the
Buyer in accordance with their terms.
5.3 Consents and Approvals; No Violation.
Except as and to the extent set forth on Schedule 5.3(a)
of the Disclosure Schedule, neither the execution and
delivery of this Agreement and the Other Documents by the
Buyer, nor the consummation of the transactions
contemplated hereby or thereby, nor compliance with any
of the provisions hereof, will (a) conflict with any
provision of the Certificate of Incorporation or Bylaws
of the Buyer, (b) require any consent, waiver, approval,
authorization or permit of, or filing with or
notification to, or any other action by, any Governmental
Authority by the Buyer, except for filings pursuant to
the applicable requirements of the HSR Act, (c) violate
any Law of any Governmental Authority applicable to the
Buyer, or by which any of its businesses, property or
assets may be bound or affected or (d) violate, breach,
or conflict with, or constitute (with or without due
notice or lapse of time or both) a default (or give rise
to any right of termination, cancellation or acceleration
or any obligation to pay or result in the imposition of
any Encumbrance upon any of the property) under, any of
the terms, conditions or provisions of any note, bond,
mortgage, indenture, Encumbrance, Contract, Permit,
Order, or other instrument or obligation to which the
Buyer is a party or by which any of its businesses,
property or assets may be bound or affected.
5.4 Investment Purpose. The Buyer is
acquiring the Shares for its own account without a view
to any distribution thereof in violation of the
securities laws of the United States of America or any
state thereof.
5.5 Brokers. The Sellers do not have, nor
will the Sellers have, any obligation to pay any
broker's, finder's, investment banker's, financial
advisor's or similar fee in connection with this
Agreement or the Other Documents, or the transactions
contemplated hereby or thereby, by any action taken by or
on behalf of the Buyer.
ARTICLE VI
ADDITIONAL COVENANTS
6.1 Transfer and Similar Taxes. (a)
Notwithstanding any other provision of this Agreement to
the contrary, the Sellers shall assume and promptly pay
all sales, use, privilege, transfer, documentary, gains,
stamp, duties, recording and similar Taxes and fees
(including any penalties, interest or additions) imposed
upon any party incurred in connection with the sale of
the Shares by the Sellers to the Buyer (collectively, the
"Transfer Taxes"), and the Sellers shall, at their own
expense, procure any stock transfer stamps required by,
and accurately file all necessary Tax Returns and other
documentation with respect to, any Transfer Tax.
6.2 Tax Returns, Refunds and Credits. (a)
The Sellers shall prepare all Tax Returns of Sumco for or
in respect of Income Taxes due with respect to the period
beginning on July 1, 1994 and ending on the Closing Date
(the "Short Period") in a manner consistent with the past
practices of Sumco for separate taxable periods (the
"Short Period Returns") in each case at the Sellers' sole
cost and expense. The Buyer shall cause Sumco to sign
and file the Short Period Returns and to pay all Income
Taxes shown on the Short Period Returns.
(b) The Buyer shall prepare and file, or
cause to be prepared and filed, on a timely basis (in
each case, at its sole cost and expense) all Tax Returns
with respect to Sumco for the Straddle Period (the
"Straddle Period Returns") and shall include the results
of Sumco's operations after the Closing Date in such
returns. The Buyer shall pay, or cause to be paid, all
Taxes due with respect to the Straddle Period. The Buyer
covenants that it will not take or cause Sumco to take
any actions with respect to Taxes of Sumco on the Closing
Date except in the ordinary course of business consistent
with the past practices of Sumco.
(c) The Sellers and the Buyer shall
cooperate, and shall cause their respective, officers,
employees, agents, auditors and representatives to
cooperate, (i) in preparing and filing the Short Period
Returns and all Straddle Period Returns (including
amended returns and claims for refund) and (ii) with
respect to any audit or other administrative or court
proceedings with respect to Taxes and Tax Returns of
Sumco for periods ending on or before the Closing Date,
in each case including maintaining and making available
to each other all records necessary in connection with
Taxes payable with respect to such Tax Returns and in
resolving all disputes and audits and refunds with
respect to such Tax Returns and Taxes and any earlier Tax
Returns and Taxes of Sumco. No election may be made by
the Buyer or Sumco with respect to the Taxes of Sumco
without the Sellers' written consent if such election
will adversely affect the Sellers (including without
limitation an election under Section 338 of the Code.
(d) For a period of seven years from the
Closing Date, the Buyer shall not, and shall cause Sumco
not to, dispose of or destroy any of the business records
and files of Sumco relating to the Taxes of Sumco in
existence on the Closing Date without first offering to
turn over possession thereof to the Sellers by written
notice to the Sellers at least thirty days prior to the
proposed date of such disposition or destruction.
(e) Any refunds of or credits for Income
Taxes of Sumco with respect to (i) any taxable period
ending on or before the Closing Date (including the Short
Period) shall be for the account of the Sellers, and if
received or utilized by the Buyer or Sumco, shall be paid
to the Sellers within five (5) business days after the
Buyer or Sumco receives such refund or utilizes such
credit, provided, however that refunds or credits
attributable to the carryback of losses or other tax
items realized after the Closing Date shall be for the
account of the Buyer, and (ii) any taxable period
beginning after the Closing Date shall be for the account
of the Buyer, and if received or utilized by the Sellers,
shall be paid by the Sellers to the Buyer within five
business days after the Sellers receive such refund or
utilize such credit.
(f) Any refunds of or credit for Taxes
(other than Income Taxes) shall be for the account of the
Buyer, and if received or utilized by the Sellers shall
be paid to the Buyer within five (5) business days after
the Sellers receive such refund or utilize such credit.
6.3 Further Assurances; Cooperation. (a) The
parties shall from time to time after the Closing, upon
the request of any other party and without further
consideration, execute, acknowledge and deliver in proper
form any further instruments, and take such further
actions as such other party may reasonably require, to
carry out effectively the intent of this Agreement and
the Other Documents.
(b) The Sellers shall cooperate with
Sumco and the Buyer in connection with any claim, action,
suit, proceeding, inquiry or investigation with any other
Person which relates to the execution and delivery of
this Agreement or the Other Documents, or the
consummation of the transactions contemplated hereunder
and thereunder.
6.4 Notification of Certain Matters. Each of
the parties hereto shall promptly notify the other
parties, in the manner provided in Section 8.10 hereof,
of (i) any claim, action, suit, proceeding, inquiry or
investigation pending or, to such party's knowledge,
threatened which relates to the execution and delivery of
this Agreement or the Other Documents, or the
consummation of the transactions contemplated hereunder
or thereunder, (ii) any circumstance or development which
could adversely impair or affect its ability to perform
its obligations under this Agreement and the Other
Documents, (iii) any notice or other communication from
any third party alleging that the consent of such third
party is or may be required in connection with the
transactions contemplated by this Agreement and the Other
Documents or (iv) any notice or other communication from
any Governmental Authority in connection with the
transactions contemplated by this Agreement and the Other
Documents.
6.5 Confidentiality/No-Investment. (a) PNCC
and Duffy agree that they will not (and in the case of
PNCC, PNCC will cause its officers not to) at any time
after the Closing, without the prior written consent of
the Buyer, disclose or use any such confidential
information except:
(i) as may be necessary in
connection with their tax filing and reporting
obligations,
(ii) to the extent required by
Law or,
(iii) as may be necessary to
comply with GAAP and generally accepted
auditing standards.
(b) PNCC agrees that for a period of two
years after the Closing Date, PNCC shall not make any
investment in any of the entities set forth on Schedule
6.5 of the Disclosure Schedule. Except as set forth in
the preceding sentence, PNCC shall be free to invest in,
or make loans to, or otherwise provide financial
accommodations to, any Person in the same business or
industry as Sumco.
(c) It is understood and agreed that
money damages would not be a sufficient remedy for any
breach of this Section 6.5 by PNCC (or its officers) or
Duffy and that the Buyer shall be entitled to specific
performance as a remedy for any such breach. Such remedy
shall not be deemed to be the exclusive remedy for any
breach of this Section 6.5 but shall be in addition to
all other remedies available at law or equity to the
Buyer.
6.6 Publicity. The Sellers shall not issue
any press release or make any public statement regarding
the transactions contemplated hereby, without the prior
approval of the Buyer, which approval shall not be
unreasonably withheld, except (i) as may be required, by
applicable Law and (ii) PNCC may disclose the completion
of the transactions contemplated by this Agreement in
connection with its general marketing and business
development activities. The Buyer hereby agrees to issue
a press release, in a form reasonably acceptable to all
of the parties, promptly after the Closing.
6.7 Expenses. (a) Except as otherwise
specifically provided for herein, each party hereto shall
be solely responsible for all expenses incurred by it or
on its behalf in connection with the preparation and
execution of this Agreement and the Other Documents and
the consummation of the transactions contemplated hereby
and thereby, including, without limitation, the fees and
expenses of its counsel, accountants, brokers, finders,
financial advisors and other representatives.
(b) The Sellers and the Buyer agree that
in the event any dispute between them, either occurring
under, relating to or in connection with any of the
provisions of this Agreement or the Other Documents, is
submitted to a Governmental Authority or other
appropriate entity, then all costs and expenses of the
parties (including reasonable legal fees) shall be paid
by the party against whom a determination by such
Governmental Authority or entity is made or, in the
absence of a determination wholly against one party, as
such Governmental Authority or entity shall direct.
(c) All costs and expenses of the Title
Company and all costs and expenses for the Survey
delivered pursuant to Section 2.6 hereof shall be paid by
the Buyer.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION
7.1 Survival of Representations and
Warranties. All representations and warranties of the
Sellers and the Buyer contained herein or made pursuant
hereto shall survive the Closing and any investigation at
any time made by or on behalf of any party hereto until
March 31, 1996, except that the representations and
warranties contained in Section 4.18 (Taxes) shall
survive until 90 days following the expiration of the
applicable statute of limitations. Provided that a claim
with respect to a breach of representation or warranty is
made within the applicable period in accordance with the
provisions of Section 7.6 hereof, it may continue to be
asserted beyond such period with respect to the
representation or warranty to which such claim relates.
7.2 Statements as Representations. All
statements contained herein or in any Schedule contained
in the Disclosure Schedule or in any Exhibit hereto shall
be deemed representations and warranties within the
meaning of Sections 7.1, 7.3(a), 7.3(b)(i) and 7.4(i)
hereof.
7.3 Indemnification by the Sellers.
(a) Subject to the provisions of this
Article VII, each Seller shall severally indemnify,
defend and hold harmless the Buyer, any parent,
subsidiary or affiliate of the Buyer, and any director,
officer, employee, agent or advisor of any of them, or
any of their respective successors or assigns (a "Buyer
Indemnified Party"), from and against any and all Losses
asserted against, resulting to, imposed upon or incurred
by any Buyer Indemnified Party, directly or indirectly,
by reason of or resulting from the breach of or any
inaccuracy in any of the representations and warranties
of such Seller contained in or made pursuant to Article
III hereof, or any facts or circumstances constituting
such breach or inaccuracy.
(b) Subject to the provisions of this
Article VII, PNCC and the Management Sellers shall,
jointly and severally, indemnify, defend and hold
harmless each Buyer Indemnified Party from and against
any and all Losses asserted against, resulting to,
imposed upon or incurred by such Buyer Indemnified Party,
directly or indirectly, by reason of or resulting from:
(i) the breach of or any
inaccuracy in any of the representations and
warranties of the Sellers contained in or made
pursuant to any section of this Agreement other
than a section in Article III hereof, or any
facts or circumstances constituting such breach
or inaccuracy;
(ii) the breach or
nonperformance of any covenant or agreement of
the Sellers contained in or made pursuant to
this Agreement or any facts or circumstances
constituting such breach or nonperformance; and
(iii) any failure by Sumco to
comply with the applicable provisions of the
Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended, at or prior to the
Closing, including, but not limited to, Losses
in respect of the loss of any tax deductions or
other favorable tax treatment claimed by Sumco
and directly or indirectly attributable to or
resulting from such failure; and
(iv) any failure by Sumco to
have obtained the Permits for the structures
set forth on Schedule 4.14(a)(1)(a)-(p) of the
Disclosure Schedule; and
(v) Income Taxes of Sumco in
respect of all taxable periods ending on or
before the Closing Date (other than the amounts
shown on the Short Period Returns, but
including all such Income Taxes assessed after
the filing of such returns) including, without
limitation, Taxes of Sumco relating to, or
attributable to, the Tax Notices.
7.4 Indemnification by the Buyer. Subject to
the provisions of this Article VII, the Buyer shall
indemnify, defend and hold harmless the Sellers, any
parent, subsidiary or affiliate of the Sellers, and any
director, officer, employee, agent or advisor of any of
them or any of their respective heirs, successors or
assigns (a "Seller Indemnified Party"), from and against
any and all Losses asserted against, resulting to,
imposed upon or incurred by any Seller Indemnified Party,
directly or indirectly, by reason of or resulting from:
(i) the breach of or any
inaccuracy in any of the representations and
warranties of the Buyer contained in or made
pursuant to this Agreement or any facts or
circumstances constituting such breach or
inaccuracy; and
(ii) the breach or non-
performance of any agreement of the Buyer
contained in or made pursuant to this Agreement
or any facts or circumstances constituting such
breach or nonperformance.
7.5 Limitations on Indemnification.
(a) The indemnifications in favor of the
Buyer Indemnified Parties contained in Section 7.3(b)(i)
hereof shall not be effective until the aggregate dollar
amount of all Losses indemnified against under such
Section exceeds $200,000 (the "Sellers' Threshold
Amount"), and then only to the extent such aggregate
amount exceeds the Sellers' Threshold Amount. The
indemnifications in favor of the Buyer Indemnified
Parties contained in Section 7.3(a) hereof shall, as to
any Seller, not exceed such Seller's Pro Rata Proceeds.
In addition, the indemnifications in favor of the Buyer
Indemnified Parties contained in Sections 7.3(a),
7.3(b)(i), 7.3(b)(ii), 7.3(b)(iii), 7.3(b)(iv) and
7.3(b)(v) hereof shall terminate once the dollar amount
of all Losses indemnified under such Sections aggregates
$25,000,000 ($26,000,000 if the full Earnout Amount is
paid to the Sellers by the Escrow Agent) (the "Sellers'
Cap Amount"); provided, however, that under no
circumstances shall PNCC's indemnification obligations in
respect of such Sections exceed its Pro Rata Proceeds.
(b) The indemnifications in favor of the
Seller Indemnified Parties contained in Section 7.4(i)
hereof shall not be effective until the aggregate dollar
amount of all Losses indemnified against under such
Section exceeds $200,000 (the "Buyer's Threshold
Amount"), and then only to the extent such aggregate
amount exceeds the Buyer's Threshold Amount. The
indemnifications in favor of the Seller Indemnified
Persons contained in Sections 7.4(i) and 7.4(ii) hereof
shall terminate once the dollar amount of all Losses
indemnified against under such Section aggregates
$25,000,000 ($26,000,000 if the full Earnout Amount is
paid to the Sellers by the Escrow Agent) (the "Buyer's
Cap Amount").
7.6 Indemnification Procedures.
(a) Notice. If any legal proceeding
shall be threatened or instituted or any claim or demand
shall be asserted by any Buyer Indemnified Party or
Seller Indemnified Party in respect of which
indemnification may be sought under the provisions of
this Agreement, the party seeking indemnification (the
"Claiming Party") shall promptly cause written notice of
the assertion of any such claim, demand or proceeding of
which it has knowledge to be forwarded to the party from
whom it is claiming indemnification (the "Indemnitor").
Such notice shall contain a reference to the provisions
hereof or of such other agreement, instrument or
certificate delivered pursuant hereto, in respect of
which such claim is being made, and shall specify, in
reasonable detail, the amount of such Loss if
determinable at such time. The Claiming Party's failure
to give the Indemnitor prompt notice shall not preclude
the Claiming Party from seeking indemnification from the
Indemnitor unless the Claiming Party's failure has
materially prejudiced the Indemnitor's ability to defend
the claim, demand or proceeding.
(b) Third Party Claims. If the Claiming
Party seeks indemnification from the Indemnitor as a
result of a claim or demand being made by a third party
(a "Third Party Claim"), the Indemnitor shall have the
right to promptly assume the control of the defense of
such Third Party Claim, including, at its own expense,
employment by it of counsel reasonably satisfactory to
the Claiming Party. The Claiming Party may, in its sole
discretion and at its own expense, employ counsel to
represent it in the defense of the Third Party Claim, and
in such event counsel for the Indemnitor shall cooperate
with counsel for the Claiming Party in such defense,
provided that the Indemnitor shall direct and control the
defense of such Third Party Claim or proceeding. The
Indemnitor shall not consent to the entry of any
judgment, except with the written consent of the Claiming
Party, and shall not enter into any settlement of such
Third Party Claim without the written consent of the
Claiming Party which (i) does not include as an
unconditional term thereof the release of the Claiming
Party from all liability in respect of such Third Party
Claim and (ii) results in the imposition on the Claiming
Party of any remedy other than money damages; provided,
however, that the Claiming Party shall not unreasonably
withhold or delay its consent to the entry of any
judgment or any settlement of a Third Party Claim. If
the Indemnitor elects not to exercise its rights to
assume the defense of the Third Party Claim, or if
injunctive relief is sought which would have an adverse
effect on the Claiming Party (or Sumco if the Buyer is
the Claiming Party), the Claiming Party may, but shall
have no obligation to, defend against such Third Party
Claim or legal proceeding in such manner as it may deem
appropriate, and the Claiming Party may compromise or
settle such Third Party Claim and proceeding without the
Indemnitor's consent so long as the Claiming Party acts
in a commercially reasonable manner (without regard to
the Claiming Party's indemnification rights hereunder).
(c) Payment. After any final judgment or
award shall have been rendered by a court, arbitration
board or administrative agency of competent jurisdiction
and the time in which to appeal therefrom shall have
expired, or a settlement shall have been consummated, or
the Claiming Party and the Indemnitor shall arrive at a
mutually binding agreement with respect to each separate
matter alleged to be indemnified by the Indemnitor
hereunder, the Claiming Party shall forward to the
Indemnitor notice of any sums due and owing by it with
respect to such matter (in accordance with Section 8.10
hereof) and the Indemnitor shall pay all of the sums so
owing to the Claiming Party by wire transfer, certified
or bank cashier's check within 10 days after the date of
such notice.
(d) Escrow. To the extent that the
Escrow Amount has not been released pursuant to the
Escrow Agreement, the Buyer Indemnified Party's right to
indemnification and to be held harmless pursuant to
7.3(a), 7.3(b)(i), 7.3(b)(ii), 7.3(b)(iii), 7.3(b)(iv)
and 7.3(b)(v) hereof must first be asserted against the
Escrow Amount.
7.7 Remedies. Except for Losses resulting
from fraud or violations of the securities laws, the sole
and exclusive remedy for any breach of this Agreement
shall be pursuant to this Article VII.
ARTICLE VIII
MISCELLANEOUS
8.1 Consent to Service. Each Management
Seller and Duffy designates and appoints the Management
Representative as its authorized agent upon whom process
may be served in any suit, proceeding or other action
against such Seller instituted by the Buyer and relating
to this Agreement. Such designation and appointment
shall, to the extent permitted by law, be irrevocable,
unless and until a successor authorized agent acceptable
to the Buyer shall have been appointed by Duffy and the
Management Sellers, such successor shall have accepted
such appointment and written notice thereof shall have
been given to the Buyer. Each Management Seller and
Duffy further agrees that service of process upon such
authorized agent or successor shall be deemed in every
respect service of process upon such Seller in any such
suit, proceeding or other action. Each Management Seller
and Duffy further agrees to take any and all action,
including the execution and filing of all such
instruments and documents, as may be necessary to
continue such designation and appointment of such
authorized agent in full force and effect.
8.2 Parties in Interest; No Third Party
Beneficiaries.
(a) This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by, the
parties hereto and their respective successors and
permitted assigns. This Agreement and the rights and
obligations of the Buyer and the Sellers hereunder may
not be assigned by any of the parties hereto without the
prior written consent of the other parties, except that
the Buyer may assign its rights and obligations hereunder
to any Designated Subsidiary, provided, however, that the
Buyer shall remain liable for all of its obligations and
those of any Designated Subsidiary hereunder.
(b) This Agreement is not intended, nor
shall it be construed, to confer upon any Person except
the parties hereto and their heirs, successors and
permitted assigns any rights or remedies under or by
reason of this Agreement.
8.3 Exhibits and Disclosure Schedule. All
Exhibits annexed hereto and the Disclosure Schedule
referred to herein are hereby incorporated in and made a
part of this Agreement as if set forth in full herein.
8.4 Entire Agreement. This Agreement,
including the Exhibits hereto and the documents,
schedules, certificates and instruments referred to
herein, embody the entire agreement and understanding of
the parties hereto in respect of the transactions
contemplated by this Agreement. This Agreement
supersedes all prior agreements, arrangements and
understandings of the parties with respect to such
transactions.
8.5 Waiver of Compliance. No amendment,
modification, alteration, supplement or waiver of
compliance with any obligation, covenant, agreement,
provision or condition hereof or consent pursuant to this
Agreement shall be effective unless evidenced by an
instrument in writing executed by all of the parties or
in the case of a waiver, the party against whom
enforcement of any waiver, is sought. Any waiver or
failure to insist upon strict compliance with such
obligation, covenant, agreement, provision or condition
shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure.
8.6 Validity. The invalidity or
unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other
provisions of this Agreement, each of which shall remain
in full force and effect.
8.7 Counterparts. This Agreement may be
executed in any number of counterparts, each of which
shall be deemed an original but all of which together
shall constitute one and the same instrument.
8.8 Headings. The table of contents, article
and section headings contained in this Agreement or any
Exhibit hereto or the Disclosure Schedule are for
convenience only and shall not control or affect in any
way the meaning or interpretation of the provisions of
this Agreement.
8.9 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of
the State of New York without giving effect to the
principles of conflicts of law of such jurisdiction.
8.10 Notices. All notices, requests, claims,
demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if
delivered personally, telecopied (which is confirmed) or
sent by registered or certified mail (postage prepaid,
return receipt requested) to the parties at the following
addresses:
(a) If to the Buyer to:
Handy & Harman
250 Park Avenue
New York, New York 10177
Telephone: (212) 661-2400
Telecopy: (212) 309-0682
Attention: Paul E. Dixon, Esq.
Copy to:
Skadden, Arps, Slate,
Meagher & Flom
919 Third Avenue
New York, New York 10022
Telephone: (212) 735-3000
Telecopy: (212) 735-2000
Attention: Milton G. Strom, Esq.
(b) If to a Seller:
to its address as set forth on
Exhibit A hereto.
Copies to:
Ice Miller Donadio & Ryan
One American Square
Indianapolis, Indiana 46282
Telephone: (317) 236-2100
Telecopy: (317) 236-2219
Attention: John R. Thornburgh, Esq.
and
Jones, Day, Reavis & Pogue
31st Floor, 500 Grant Street
Pittsburgh, Pennsylvania 15265
Telephone: (412) 391-3939
Telecopy: (412) 394-7959
Attention: Charles A. Schliebs, Esq.
or to such other address as the person to whom notice is
to be given may have previously furnished to the other in
writing in the manner set forth above, provided that
notice of a change of address shall be deemed given only
upon receipt.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement, on the day and year first above
written.
THE SELLERS:
/s/ R. Robert Brouillard
R. Robert Brouillard
/s/ Guy R. Brouillard
Guy R. Brouillard
/s/ Thomas R. Brouillard
Thomas R. Brouillard
/s/ Mark R. Brouillard
Mark R. Brouillard
/s/ Lawrence H. Schone
Lawrence H. Schone
/s/ G. Winfield Yarnall, Jr.
G. Winfield Yarnall, Jr.
/s/ Pierre J. Plante
Pierre J. Plante
/s/ Gary F. Cooke
Gary F. Cooke
/s/ Gary M. Lents
Gary M. Lents
/s/ Patrick C. Duffy
Patrick C. Duffy
PNC Capital Corp.
By: /s/ Paul A. Giusti
Name: Paul A. Giusti
Title: Senior Vice President
and Principal
THE BUYER:
HANDY & HARMAN
By:/s/ Paul E. Dixon
Name: Paul E. Dixon
Title: Vice President
and General Counsel
EXHIBIT 10.2
FROM: ON BEHALF OF:
Robert W. Bloch International Handy & Harman
30 East 60th Street
New York, NY 10022 Contact:
212 755 8047 Richard P. Schneider
Vice President,
Corporate Development
914 925 4412
FOR IMMEDIATE RELEASE:
New York, NY...September 12th, 1994--Handy & Harman today announced
that it acquired Sumco, Inc., an Indianapolis, Indiana-based precision
electroplating firm, focusing on plating electronic connectors
and connector stock for the automotive, telecommunications
and computer industries. Handy & Harman acquired 100% of the shares
of Sumco from management shareholders and PNC Capital Corp.,
a leveraged buyout investment firm headquartered in Pittsburgh,
Pennsylvania. In the twelve months ended June 30th, 1994, Sumco
had sales of approximately $22.5-million.
In announcing the transaction, Handy & Harman Chairman Richard N.
Daniel commented, "The acquisition of Sumco represents a signifi-
cant expansion of Handy & Harman's capabilities in the area of pre-
cision industrial electroplating. Following this acquisition, we
will be able to offer a broader range of sophisticated precious and
non-precious metal plating technologies and products to our customers
in the telecommunications, automotive and electronics industries."
(more)
Mr. Daniel continued: "We expect Sumco to continue to grow and, in
the future, expand beyond its current 70,000 square foot, state-of-
the-art operations and office facilities. An early goal is to widen
Sumco's involvement in precious metal plating for a variety of in-
dustries. Toward this end, Handy & Harman has particular strengths
and capacities to include design applications."
"We were particularly impressed with the Sumco management team,
headed by President Robert Brouillard. Sumco's management will
remain with the company, which will become a wholly-owned subsidiary
of Handy & Harman and function as part of our Precious Metals Group,"
Mr. Daniel concluded.
Handy & Harman, a leading fabricator, processor and refiner of pre-
cious metals, also produces a variety of specialty metal products
for industrial uses through subsidiaries and divisions here and
abroad. Founded in 1867, Handy & Harman is headquartered in New
York. The shares of Handy & Harman are traded on the New York
Stock Exchange with the ticker symbol: HNH.
# # #
EXHIBIT 10.3
EXECUTION COPY
U.S. $161,250,000
REVOLVING CREDIT AGREEMENT,
dated as of September 28, 1994
among
HANDY & HARMAN,
as the Borrower,
CERTAIN FINANCIAL INSTITUTIONS,
as the Lenders,
THE BANK OF NOVA SCOTIA,
CHEMICAL BANK
and
THE BANK OF NEW YORK,
as the Co-Agents,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . .
1.4. Accounting and Financial Determinations;
No Duplication; Consolidation . . . . . . . . .
ARTICLE II
COMMITMENTS, BORROWING, BIDDING AND
ISSUANCE PROCEDURES, NOTES AND LETTERS OF CREDIT
2.1. Commitments . . . . . . . . . . . . . . . . . . .
2.1.1. Revolving Loan Commitment . . . . . . . . . . . .
2.1.2. Lenders Not Permitted or Required to
Make Revolving Loans . . . . . . . . . . . . .
2.1.3. Letter of Credit Commitment . . . . . . . . . . .
2.1.4. Issuer Not Permitted or Required to
Issue Letters of Credit . . . . . . . . . . . .
2.2. Reduction of Commitment Amounts . . . . . . . . .
2.2.1. Optional Reduction of Commitments . . . . . . . .
2.2.2. Mandatory Reduction of Commitments . . . . . . .
2.3. Revolving Loan Borrowing Procedure and
Funding Maintenance . . . . . . . . . . . . . .
2.3.1. Continuation and Conversion Elections . . . . . .
2.3.2. Funding . . . . . . . . . . . . . . . . . . . . .
2.4. Competitive Bid Loans . . . . . . . . . . . . . .
2.5. Notes . . . . . . . . . . . . . . . . . . . . . .
2.6. Issuing the Letters of Credit . . . . . . . . . .
2.6.1. Drawings under the Letters of Credit . . . . . .
2.6.2. Reimbursement on Demand . . . . . . . . . . . . .
2.6.3. Obligations Absolute . . . . . . . . . . . . . .
2.6.4. Action in Respect of the Letters of
Credit . . . . . . . . . . . . . . . . . . . .
2.6.5. Indemnification . . . . . . . . . . . . . . . . .
2.6.6. Deemed Disbursements . . . . . . . . . . . . . .
2.6.7. Other Lenders' Participation . . . . . . . . . .
2.7. Extension of Stated Maturity Date and
Maturity of Loans . . . . . . . . . . . . . . .
2.7.1. Request for Extension of Stated Maturity
Date and Maturity of Loans . . . . . . . . . .
2.7.2. Consent to Extension of Stated Maturity
Date and Maturity of Loans . . . . . . . . . .
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments . . . . . . . . . . .
3.1.1. Final Maturity . . . . . . . . . . . . . . . . .
3.1.2. Voluntary Prepayments . . . . . . . . . . . . . .
3.1.3. Mandatory Prepayments . . . . . . . . . . . . . .
3.1.4. Acceleration of Stated Maturity Date . . . . . .
3.2. Interest Provisions . . . . . . . . . . . . . . .
3.2.1. Rates . . . . . . . . . . . . . . . . . . . . . .
3.2.2. Post-Maturity Rates . . . . . . . . . . . . . . .
3.2.3. Payment Dates . . . . . . . . . . . . . . . . . .
3.3. Fees . . . . . . . . . . . . . . . . . . . . . .
3.3.1. Commitment Fee . . . . . . . . . . . . . . . . .
3.3.2. Letter of Credit Fee . . . . . . . . . . . . . .
3.3.3. Agents' Fee . . . . . . . . . . . . . . . . . . .
3.3.4. Certain Other Fees . . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . .
4.2. Deposits Unavailable . . . . . . . . . . . . . .
4.3. Increased LIBO Rate Loan Costs, etc. . . . . . .
4.4. Funding Losses . . . . . . . . . . . . . . . . .
4.5. Increased Capital Costs . . . . . . . . . . . . .
4.6. Taxes . . . . . . . . . . . . . . . . . . . . . .
4.7. Payments, Computations, etc. . . . . . . . . . .
4.8. Sharing of Payments . . . . . . . . . . . . . . .
4.9. Setoff . . . . . . . . . . . . . . . . . . . . .
4.10. Use of Proceeds . . . . . . . . . . . . . . . . .
4.11. Replacement of Lenders . . . . . . . . . . . . .
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . . .
5.1.2. Delivery of Notes . . . . . . . . . . . . . . . .
5.1.3. Payment of Outstanding Indebtedness,
etc. . . . . . . . . . . . . . . . . . . . . .
5.1.4. Opinions of Counsel . . . . . . . . . . . . . . .
5.1.5. Closing Fees, Expenses, etc. . . . . . . . . . .
5.1.6. Termination of Existing Agreement . . . . . . . .
5.2. All Credit Extensions . . . . . . . . . . . . . .
5.2.1. Compliance with Warranties, No Default,
etc. . . . . . . . . . . . . . . . . . . . . .
5.2.2. Credit Extension Request . . . . . . . . . . . .
5.2.3. Satisfactory Legal Form . . . . . . . . . . . . .
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc. . . . . . . . . . . . . . . .
6.2. Due Authorization, Non-Contravention,
etc. . . . . . . . . . . . . . . . . . . . . .
6.3. Government Approval, Regulation, etc. . . . . . .
6.4. Validity, etc. . . . . . . . . . . . . . . . . .
6.5. Financial Information . . . . . . . . . . . . . .
6.6. No Material Adverse Change . . . . . . . . . . .
6.7. Litigation, etc. . . . . . . . . . . . . . . . .
6.8. Subsidiaries . . . . . . . . . . . . . . . . . .
6.9. Ownership of Properties . . . . . . . . . . . . .
6.10. Taxes . . . . . . . . . . . . . . . . . . . . . .
6.11. Pension and Welfare Plans . . . . . . . . . . . .
6.12. Environmental Warranties . . . . . . . . . . . .
6.13. Regulations G, U and X . . . . . . . . . . . . .
6.14. Accuracy of Information . . . . . . . . . . . . .
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants . . . . . . . . . . . . . .
7.1.1. Financial Information, Reports, Notices,
etc. . . . . . . . . . . . . . . . . . . . . .
7.1.2. Compliance with Laws, etc. . . . . . . . . . . .
7.1.3. Maintenance of Properties . . . . . . . . . . . .
7.1.4. Insurance . . . . . . . . . . . . . . . . . . . .
7.1.5. Books and Records . . . . . . . . . . . . . . . .
7.1.6. Environmental Covenant . . . . . . . . . . . . .
7.2. Negative Covenants . . . . . . . . . . . . . . .
7.2.1. Business Activities . . . . . . . . . . . . . . .
7.2.2. Designated Debt, Letters of Credit;
Subsidiary Debt . . . . . . . . . . . . . . . .
7.2.3. Liens . . . . . . . . . . . . . . . . . . . . . .
7.2.4. Financial Condition . . . . . . . . . . . . . . .
7.2.5. Investments . . . . . . . . . . . . . . . . . . .
7.2.6. Restricted Payments, etc. . . . . . . . . . . . .
7.2.7. Transactions with Affiliates . . . . . . . . . .
7.2.8. Long Term Rental Obligations . . . . . . . . . .
7.2.9. Take or Pay Contracts . . . . . . . . . . . . . .
7.2.10. Consolidation, Merger, etc. . . . . . . . . . . .
7.2.11. Asset Dispositions, etc. . . . . . . . . . . . .
7.2.12. Restrictive Agreements, etc. . . . . . . . . . .
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . .
8.1.1. Non-Payment of Obligations . . . . . . . . . . .
8.1.2. Breach of Warranty . . . . . . . . . . . . . . .
8.1.3. Non-Performance of Certain Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.4. Non-Performance of Other Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.5. Default on Other Indebtedness or
Agreements . . . . . . . . . . . . . . . . . .
8.1.6. Judgments . . . . . . . . . . . . . . . . . . . .
8.1.7. Pension Plans . . . . . . . . . . . . . . . . . .
8.1.8. Control of the Borrower . . . . . . . . . . . . .
8.1.9. Bankruptcy, Insolvency, etc. . . . . . . . . . .
8.2. Action if Bankruptcy . . . . . . . . . . . . . .
8.3. Action if Other Event of Default . . . . . . . .
ARTICLE IX
THE AGENTS
9.1. Actions . . . . . . . . . . . . . . . . . . . . .
9.2. Funding Reliance, etc. . . . . . . . . . . . . .
9.3. Exculpation . . . . . . . . . . . . . . . . . . .
9.4. Successor . . . . . . . . . . . . . . . . . . . .
9.5. Credit Extensions by an Agent. . . . . . . . . .
9.6. Credit Decisions . . . . . . . . . . . . . . . .
9.7. Copies, etc. . . . . . . . . . . . . . . . . . .
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc. . . . . . . . . . . . .
10.2. Notices . . . . . . . . . . . . . . . . . . . . .
10.3. Payment of Costs and Expenses . . . . . . . . . .
10.4. Indemnification . . . . . . . . . . . . . . . . .
10.5. Survival . . . . . . . . . . . . . . . . . . . .
10.6. Severability . . . . . . . . . . . . . . . . . .
10.7. Headings . . . . . . . . . . . . . . . . . . . .
10.8. Execution in Counterparts,
Effectiveness, etc. . . . . . . . . . . . . . .
10.9. Governing Law; Entire Agreement . . . . . . . . .
10.10. Successors and Assigns . . . . . . . . . . . . .
10.11. Sale and Transfer of Loans and Note;
Participations in Loans and Note . . . . . . .
10.11.1. Assignments . . . . . . . . . . . . . . . . . . .
10.11.2. Participations . . . . . . . . . . . . . . . . .
10.12. Other Transactions . . . . . . . . . . . . . . .
10.13. Forum Selection and Consent to
Jurisdiction . . . . . . . . . . . . . . . . .
10.14. Waiver of Jury Trial . . . . . . . . . . . . . .
EXHIBIT A-1 Form of Revolving Loan Note
EXHIBIT A-2 Form of Competitive Bid Loan Note
EXHIBIT B-1 Form of Revolving Loan Borrowing Request
EXHIBIT B-2 Form of Competitive Bid Loan Borrowing Request
EXHIBIT B-3 Form of Issuance Request
EXHIBIT C-1 Form of Invitation for Bid Loan Quotes
EXHIBIT C-2 Form of Competitive Bid Loan Offer
EXHIBIT C-3 Form of Competitive Bid Loan Acceptance
EXHIBIT D Form of Lender Assignment Agreement
EXHIBIT E Form of Compliance Certificate
EXHIBIT F Form of Continuation/Conversion Notice
EXHIBIT G Form of Extension Request
EXHIBIT H Form of Opinion of Counsel to the Borrower
EXHIBIT I Form of Opinion of Counsel to the Administrative
Agent
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT, dated as of September 28,
1994, among HANDY & HARMAN, a New York corporation (the
"Borrower"), the various financial institutions as are or may
become parties hereto (collectively, the "Lenders"), THE BANK OF
NOVA SCOTIA ("Scotiabank"), CHEMICAL BANK ("Chemical") and THE
BANK OF NEW YORK ("BONY"), as co-agents (in such capacity,
individually referred to as a "Co-Agent" and collectively
referred to as the "Co-Agents"), and Scotiabank, as
administrative agent (in such capacity, together with any
successor appointed pursuant to Section 9.4, the "Administrative
Agent") for the Lenders,
W I T N E S S E T H:
WHEREAS, the Borrower is engaged directly and through its
various Subsidiaries in the businesses described in the
Borrower's Annual Report on Form 10-K for the 1993 Fiscal Year;
WHEREAS, the Borrower desires to obtain Commitments from the
Lenders pursuant to which Revolving Loans and Letters of Credit
(including the Existing Letters of Credit), in a maximum
aggregate principal and stated amount at any one time outstanding
not to exceed $161,250,000, will be made to, or issued for the
account of, the Borrower from time to time prior to the
Commitment Termination Date;
WHEREAS, the Borrower also desires the Lenders to provide a
procedure pursuant to which the Borrower may invite the Lenders
to bid for (on an uncommitted basis) and to make short-term loans
(in the form of Competitive Bid Loans) to the Borrower;
WHEREAS, the Lenders are willing, on the terms and subject
to the conditions hereinafter set forth (including Article V), to
(a) extend such Commitments;
(b) make Revolving Loans to the Borrower;
(c) issue (or participate in) Letters of Credit
(including the Existing Letters of Credit) for the benefit
of the Borrower and its Subsidiaries; and
(d) provide such a procedure to make Competitive Bid
Loans; and
WHEREAS, the proceeds of such Credit Extensions will be used
to refinance in full all amounts under the Existing Agreement and
for the general corporate purposes of the Borrower and its
Subsidiaries;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"Absolute Rate" means, with respect to an Absolute Rate Loan
made by a given Lender, a fixed rate of interest per annum
(rounded to the nearest 1/100th of 1%) offered by such Lender and
accepted by the Borrower.
"Absolute Rate Auction" means a solicitation of Competitive
Bid Loan quotes at an Absolute Rate pursuant to Section 2.4.
"Absolute Rate Loan" means a Competitive Bid Loan which
bears interest at an Absolute Rate.
"Adjusted Consolidated Tangible Net Worth" means the sum of
(a) Consolidated Tangible Net Worth
plus
(b) 40% of the excess of the Market Value of the
Borrower's and its Subsidiaries' owned precious metal
holdings over the LIFO cost of such holdings as set forth in
the Borrower's consolidated financial statements delivered
to the Lenders pursuant to clause (a) or (b) of Section
7.1.1.
"Administrative Agent" is defined in the preamble.
"Affected LIBO Lender" is defined in Section 4.3.
"Affiliate" means, with respect to any Person, any other
Person which, directly or indirectly, controls, is controlled by
or is under common control with such Person (excluding any
trustee under, or any committee with responsibility for
administering, any Plan); provided, that none of Mario Gabelli,
Gabelli Funds, Inc., Gamco Investors, Inc., Gabelli & Company,
Inc. or Gabelli Performance Partnership shall be considered an
"Affiliate" of the Borrower. "Control" and its derivatives means
the power, directly or indirectly,
(a) to vote 10% or more of the securities or other
ownership or beneficial interests (on a fully diluted basis)
having ordinary voting power for the election of directors
or managing general partners of any Person; or
(b) to direct or cause the direction of the management
and policies of such Person whether by contract or
otherwise.
"Agent" means, as the context may require, either
Scotiabank, BONY or Chemical, acting in their capacity as
Co-Agent, or Administrative Agent.
"Agreement" means, on any date, this Revolving Credit
Agreement as originally in effect on the Effective Date and as
thereafter from time to time amended, restated, supplemented,
amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to
all Base Rate Loans, a fluctuating rate of interest per annum
equal to the higher of
(a) the rate of interest most recently established by
Scotiabank at its Domestic Office as its base rate for
Dollar loans in the United States; and
(b) the Federal Funds Rate for such date plus 1/2
of 1%.
The Alternate Base Rate is not necessarily intended to be the
lowest rate of interest determined by Scotiabank in connection
with extensions of credit. Changes in the rate of interest on
any Loans or other Obligations accruing interest at the Alternate
Base Rate will take effect simultaneously with each change in the
Alternate Base Rate. The Administrative Agent will give prompt
notice to the Borrower and the Lenders of changes in the
Alternate Base Rate.
"Assignee Lender" is defined in Section 10.11.1.
"Authorized Officer" means those officers of the Borrower
whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders pursuant to Section 5.1.1.
"Base Rate Loan" means a Revolving Loan bearing interest at
a fluctuating rate determined by reference to the Alternate Base
Rate.
"BONY" is defined in the preamble.
"Borrower" is defined in the preamble.
"Borrowing" means, as the context may require, either a
Competitive Bid Loan Borrowing or a Revolving Loan Borrowing.
"Borrowing Request" means, as the context may require,
either a Revolving Loan Borrowing Request or a Competitive Bid
Loan Borrowing Request.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to
be closed in New York, New York; and
(b) relative to the making, continuing, prepaying or
repaying of any LIBO Rate Loans or Competitive Bid Loans
made as a result of a LIBOR Auction, any day on which
dealings in Dollars are carried on in the London interbank
market.
"Capital Expenditures" means, for any period, the aggregate
amount of all expenditures of the Borrower and its Subsidiaries
for fixed or capital assets made during such period which, in
accordance with GAAP, would be classified as capital
expenditures, including the aggregate amount of all Capitalized
Lease Liabilities incurred during such period.
"Capitalized Lease Liabilities" means all monetary
obligations of the Borrower or any of its Subsidiaries under any
leasing or similar arrangement which, in accordance with GAAP,
would be classified as capitalized leases, and, for purposes of
this Agreement and each other Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined
in accordance with GAAP.
"Cash Equivalent Investment" means, at any time:
(a) any obligation issued or guaranteed by the United
States Government or any agency thereof, maturing not more
than one year after such time;
(b) commercial paper, maturing not more than nine
months from the date of issue, which is issued by
(i) a corporation (other than the Borrower or an
Affiliate of the Borrower) organized under the laws of
any state of the United States or of the District of
Columbia and rated A-1 by Standard & Poor's Corporation
or P-1 by Moody's Investors Service, Inc., or
(ii) any Lender (or its holding company);
(c) any certificate of deposit or bankers acceptance,
maturing not more than one year after such time, which is
issued by either
(i) a commercial banking institution that is a member
of the Federal Reserve System and has total assets of
not less than $5,000,000,000 and commercial paper rated
A-1 by Standard & Poor's Corporation or P-1 by Moody's
Investors Service, Inc., or
(ii) any Lender; or
(d) any repurchase agreement entered into with any
Lender (or other commercial banking institution of the
stature referred to in clause (c)(i)) which
(i) is secured by a fully perfected security interest
(which may be hold in custody, tri-party custodian or
deliver out) in any obligation of the type described in
any of clauses (a) through (c), and
(ii) has a market value at the time such repurchase
agreement is entered into of not less than 100% of the
repurchase obligation of such Lender (or other
commercial banking institution) thereunder.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response
Compensation Liability Information System List.
"Change in Control" means the acquisition by any Person, or
two or more Persons acting in concert, of beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934) of 20% or
more of the outstanding shares of voting stock of the Borrower.
"Chemical" is defined in the preamble.
"Co-Agent" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Code" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.
"Commitment" means, as the context may require, the
Revolving Loan Commitment or the Letter of Credit Commitment.
"Commitment Termination Date" means, as the context may
require, the Letter of Credit Commitment Termination Date or the
Loan Commitment Termination Date.
"Commitment Termination Event" means
(a) the occurrence of any Default described in clauses
(a) through (d) of Section 8.1.9; or
(b) the occurrence and continuance of any other Event
of Default and either
(i) the declaration of the Loans to be due and payable
pursuant to Section 8.3, or
(ii) in the absence of such declaration, the giving of
notice by the Administrative Agent, acting at the
direction of the Required Lenders, to the Borrower that
the Commitments have been terminated.
"Competitive Bid Loan" means a loan made by a Lender to the
Borrower based on the LIBO Rate or the Absolute Rate as part of a
Competitive Bid Loan Borrowing resulting from the procedure
described in Section 2.4.
"Competitive Bid Loan Acceptance" means an acceptance by the
Borrower of a Competitive Bid Loan Offer pursuant to clause (e)
of Section 2.4, substantially in the form of Exhibit C-3 attached
hereto.
"Competitive Bid Loan Borrowing" means Competitive Bid Loans
made pursuant to the same Competitive Bid Loan Request by the
Lender or each of the Lenders whose offer to make such
Competitive Bid Loans as part of such requested Borrowing has
been accepted by the Borrower pursuant to clause (e) of Section
2.4.
"Competitive Bid Loan Borrowing Request" means a certificate
requesting that the Lenders extend offers to make Competitive Bid
Loans, duly executed by an Authorized Officer substantially in
the form of Exhibit B-2 attached hereto.
"Competitive Bid Loan Maturity Date" is defined in
clause (a)(iii) of Section 2.4.
"Competitive Bid Loan Note" means any promissory note of the
Borrower, in the form of Exhibit A-2 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to
such Lender resulting from Competitive Bid Loans outstanding from
such Lender, and also means all other promissory notes accepted
from time to time in substitution therefor or renewal thereof.
"Competitive Bid Loan Offer" means an offer by a Lender to
make a Competitive Bid Loan pursuant to clause (c) of
Section 2.4, substantially in the form of Exhibit C-2 attached
hereto.
"Competitive Bid Rate" means, as the context may require,
either the Absolute Rate or the LIBO Rate (plus the LIBO Rate Bid
Margin) offered by a Lender in a Competitive Bid Loan Offer in
respect of a Competitive Bid Loan proposed pursuant to Section
2.4.
"Compliance Certificate" means a certificate duly executed
and delivered by an Authorized Officer pursuant to Section 7.1.1,
in substantially the form of Exhibit E hereto.
"Consignment Facilities" means, collectively, (i) the Fee
Consignment Agreement dated as of the date hereof between the
Borrower (as consignee) and Scotiabank (as consignor), (ii) the
Short-Term Fee Consignment Agreement dated as of the date hereof
between the Borrower (as consignee) and Scotiabank (as
consignor), (iii) the Dollar Supply Agreement dated as of the
date hereof among the Borrower (as consignee), Scotiabank (as
consignor), the financial institutions parties thereto,
Scotiabank, BONY and Chemical Bank as the co-agents, and
Scotiabank as the administrative agent and (iv) the Short-Term
Dollar Supply Agreement dated as of the date hereof among the
Borrower (as consignee), Scotiabank (as consignor), the financial
institutions parties thereto, Scotiabank, BONY and Chemical Bank
as the co-agents, and Scotiabank as the administrative agent, in
each case as such agreements may be amended, supplemented,
amended and restated or otherwise modified pursuant to the terms
thereof.
"Consolidated Tangible Net Worth" means the excess of
(a) the sum of
(i) the par value (or value stated on the books of the
Borrower) of the capital stock of all classes of the
Borrower, plus (or minus in the case of a surplus
deficit),
(ii) the amount of the consolidated surplus, whether
capital or earned, of the Borrower and its Subsidiaries
over
(b) the sum of
(i) treasury stock, subscribed but unissued stock,
unamortized debt discount and expense, good will,
trademarks, trade names, patents and other intangible
assets (but not deferred charges) of the Borrower, and
(ii) all write-ups in the book value of any assets
owned by the Borrower or its Subsidiaries subsequent to
March 16, 1992, other than write-ups of assets (and
assets of Subsidiaries) acquired by the Borrower and/or
its Subsidiaries (exclusive of goodwill) that are made
in connection with the acquisition thereof.
"Contingent Liability" means any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise
becomes or is contingently liable upon or with respect to (by
direct or indirect agreement, contingent or otherwise, to provide
funds for payment (including an agreement to cause a letter of
credit to be issued for the benefit of another Person), to supply
funds to, or otherwise to invest in, a debtor, or otherwise to
assure a creditor against loss, including an agreement to
purchase, sell or lease (as lessee or lessor) property, products,
materials or supplies or services for the purpose of enabling a
debtor to make payment of its obligations) the Indebtedness,
obligation or any other liability, net worth, working capital or
earnings of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of
any other Person. The amount of any Person's obligation under
any Contingent Liability shall (subject to any limitation set
forth therein) be deemed to be the outstanding principal amount
(or maximum principal amount, if larger) of the debt, obligation
or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of
continuation or conversion and certificate duly executed by an
Authorized Officer, substantially in the form of Exhibit F
attached hereto.
"Contract" is defined in clause (a) of Section 2.6.3.
"Controlled Group" means all members of a controlled group
of corporations and all members of a controlled group of trades
or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single
employer under Section 414(b) or 414(c) of the Code or Section
4001 of ERISA.
"Credit Extension" means, as the context may require,
(a) the making of a Loan by a Lender; or
(b) the issuance of any Letter of Credit by the
Issuer.
"Credit Extension Request" means any Borrowing Request or
Issuance Request.
"Current Debt" means the aggregate amount of current
maturities of the consolidated Debt of the Borrower and its
Subsidiaries (other than the Loans and Debt, if any, under the
Consignment Facilities), determined in accordance with GAAP.
"Debt" means (i) the outstanding principal and stated amount
of the consolidated Indebtedness of the Borrower and its
Subsidiaries of the nature referred to in clauses (a), (b) and
(c) of the definition of "Indebtedness" and, without duplication,
(ii) any Contingent Liabilities of the Borrower and its
Subsidiaries in respect of any types of the Indebtedness
described in clause (i) above, other than Contingent Liabilities
under the Consignment Facilities; provided, however, that "Debt"
shall not include Indebtedness of Non-Recourse Joint Ventures.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Designated Debt" means the aggregate amount of (i) Current
Debt, and (ii) outstanding Loans and Letter of Credit
Outstandings.
"Disbursement" means any payment made under a Letter of
Credit by the Issuer thereof to the beneficiary (or its assignee
or transferee) of such Letter of Credit.
"Disbursement Date" is defined in Section 2.6.1.
"Disclosure Schedule" means the Disclosure Schedule attached
hereto as Schedule I, as it may be amended, supplemented or
otherwise modified from time to time by the Borrower with the
written consent of the Administrative Agent and the Required
Lenders.
"Dollar" and the symbol "$" mean lawful money of the United
States.
"Domestic Office" means, relative to any Lender, the office
of such Lender designated as such below its signature hereto or
designated in the Lender Assignment Agreement or such other
office of a Lender (or any successor or assign of such Lender)
within the United States as may be designated from time to time
by notice from such Lender, as the case may be, to each other
party hereto.
"EBIT" shall mean, for any period, the sum for such period
of all amounts which, in accordance with GAAP, would be included
on the consolidated financial statements of the Borrower and its
Subsidiaries as
(a) Net Income;
plus
(b) Interest Expense;
plus
(c) to the extent deducted in determining Net Income,
provisions for income taxes.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 10.8.
"Eligible Receivable" shall mean any Receivable of the
Borrower or any of its Subsidiaries which:
(a) is lawfully owned by the Borrower or such
Subsidiary free and clear of any Lien (other than Liens
permitted under Section 7.2.3);
(b) is a valid, binding and legally enforceable
obligation of the obligor under such Receivable;
(c) is not subject to any dispute, setoff,
counterclaim, or other claim or defense on the part of the
obligor thereunder, and is not subject to an obligor denying
liability under such Receivable in whole or in part;
(d) is a bona fide Receivable arising from the sale
(on an absolute, and not a consignment, approval, or sale-
and-return basis, it being understood that the exchange of
damaged goods by the Borrower or any of its Subsidiaries in
the ordinary course of its business consistent with past
practice shall not constitute any such consignment, approval
or sale-and-return basis) of goods by the Borrower or such
Subsidiary, in the ordinary course of its business, which
goods have been shipped or delivered to the obligor
thereunder;
(e) is payable not more than 90 days after the
shipping of goods giving rise to such Receivable, and is not
more than 60 days past due;
(f) has not been written off or reserved against; and
(g) is the obligation of an obligor which is neither:
(i) an Affiliate of the Borrower, nor
(ii) the subject of any reorganization, bankruptcy,
receivership, custodianship, insolvency or other like
proceeding, or any other event of the nature set forth
in clauses (a) through (d) of Section 8.1.9;
provided, that notwithstanding the foregoing, "Eligible
Receivable" shall also include 75% of the amount of the GO/DAN
Receivable.
"Environmental Laws" means all applicable federal, state or
local statutes, laws, ordinances, codes, rules, regulations and
guidelines (including consent decrees and administrative orders)
relating to public health and safety and protection of the
environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import,
together with the regulations thereunder, in each case as in
effect from time to time. References to sections of ERISA also
refer to any successor sections.
"Event of Default" is defined in Section 8.1.
"Existing Agreement" means the Revolving Credit Agreement,
dated as of March 16, 1992 (as amended or otherwise modified from
time to time prior to the Effective Date), among the Borrower,
certain financial institutions parties thereto, The Bank of Nova
Scotia, The Chase Manhattan Bank, N.A. and Chemical Bank as the
co-agents and The Bank of Nova Scotia, as administrative agent.
"Existing Letters of Credit" means each of the letters of
credit identified in Item 1 of the Disclosure Schedule.
"Extension Request" means an extension request duly executed
by an Authorized Officer, substantially in the form of Exhibit G
hereto.
"Federal Funds Rate" means, for any day, a fluctuating
interest rate per annum equal for such day to the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is not a
Business Day in the City of New York, for the next preceding
Business Day) by the Federal Reserve Bank of New York; provided,
however, that if such rate is not so published for any day which
is a Business Day in the City of New York, the rate for such day
shall be the average of the quotations for such day on such
transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it.
"Fee Letter" means the confidential letter agreement, dated
as of June 28, 1994, as modified by the letter agreement dated
July 29, 1994, each by and between the Borrower and Scotiabank
and as further amended, restated, supplemented, amended and
restated or otherwise modified from time to time.
"Fiscal Quarter" means any quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive
calendar months ending on December 31; references to a Fiscal
Year with a number corresponding to any calendar year (e.g. the
"1993 Fiscal Year") refer to the Fiscal Year ending on the
December 31 occurring during such calendar year.
"F.R.S. Board" means the Board of Governors of the Federal
Reserve System or any successor thereto.
"GAAP" is defined in Section 1.4.
"GO/DAN Receivable" means the Receivable owing to the
Borrower on the Effective Date (i) of which GO/DAN Industries is
the account obligor and (ii) which on the Effective Date had a
principal balance of $8,078,571, as such amount may be reduced by
payments thereon from time to time (but not increased in any
manner).
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b)any "hazardous waste", as defined by the Resource
Conservation and Recovery Act;
(c)any crude oil or petroleum or any fraction thereof;
(d) asbestos, radioactive materials or polychlorinated
biphenyls in any form or condition; or
(e)any pollutant or contaminant or hazardous, dangerous
or toxic chemical, material or substance within the meaning
of any other applicable federal, state or local law,
regulation, ordinance or requirement (including consent
decrees and administrative orders) relating to or imposing
liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material, all as
amended or hereafter amended.
"Hedging Obligations" means, with respect to any Person, all
liabilities of such Person under interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements and
similar agreements and arrangements entered into in respect of
interest rates, and all hedging agreements or arrangements
entered into in respect of fluctuations in currency exchange
rates.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Loan Document refer to
this Agreement or such other Loan Document, as the case may be,
as a whole and not to any particular Section, paragraph or
provision of this Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion
or certification of any independent public accountant as to any
financial statement of the Borrower, any qualification or
exception to such opinion or certification:
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination
of matters relevant to such financial statement; or
(c) which relates to the treatment or classification
of any item in such financial statement and which, as a
condition to its removal, would require an adjustment to
such item the effect of which would be to cause the Borrower
to be in default of any of its obligations under Section
7.2.4.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Loan Document, the parties hereto agree
that the rule of ejusdem generis shall not be applicable to limit
a general statement, which is followed by or referable to an
enumeration of specific matters or to matters specifically
mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money
and all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(b) all obligations (without duplication of
obligations set forth in clause (a)), contingent or
otherwise, relative to the face amount of all letters of
credit, whether or not drawn, and banker's acceptances
issued for the account of such Person;
(c) all obligations of such Person as lessee under
leases which have been or should be, in accordance with
GAAP, recorded as Capitalized Lease Liabilities;
(d) all other items which, in accordance with GAAP,
would be included as liabilities on the liability side of
the balance sheet of such Person as of the date at which
Indebtedness is to be determined (other than deferred
taxes);
(e) net liabilities of such Person under all Hedging
Obligations;
(f) to the extent included as liabilities in
accordance with GAAP, all obligations of such Person to pay
the deferred purchase price of property or services, and
indebtedness (excluding prepaid interest thereon) secured by
a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or
other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is
limited in recourse; and
(g) all Contingent Liabilities of such Person in
respect of any of the foregoing.
For all purposes of this Agreement, the Indebtedness of any
Person shall not include the Indebtedness of a Non-Recourse Joint
Venture.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Interest Coverage Ratio" means, at the close of any Fiscal
Quarter, the ratio, computed for the period consisting of such
Fiscal Quarter and each of the three immediately preceding Fiscal
Quarters, of
(a) EBIT
to
(b) Interest Expense.
"Interest Expense" means, for any period, the aggregate
amount of interest expense of the Borrower and its Subsidiaries
for such period which, in accordance with GAAP, would be included
on the consolidated financial statements of the Borrower,
including without limitation the portion of any rent paid on
Capitalized Lease Liabilities which is allocable to interest
expense in accordance with GAAP and including fees or rents
arising from or relating to consignment or leasing of precious
metals other than up-front fees paid on the Effective Date to the
Lenders. Any such interest expense which is subject to a Hedging
Obligation will be calculated on the net effect of any payments
made by the other party to such Hedging Obligation.
"Interest Period" means
(a) relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO
Rate Loan is made or continued as, or converted into, a LIBO
Rate Loan pursuant to Section 2.3 or 2.3.1 and shall end on
(but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such
month has no numerically corresponding day, on the last
Business Day of such month), as the Borrower may select in
its relevant notice pursuant to Section 2.3 or 2.3.1;
provided, however, that
(i) Interest Periods commencing on the same date for
Revolving Loans comprising part of the same Borrowing
shall be of the same duration,
(ii) if such Interest Period would otherwise end on a
day which is not a Business Day, such Interest Period
shall end on the next following Business Day; provided,
however, that if such next following Business Day is
the first Business Day of a calendar month, such
Interest Period shall end on the next preceding
Business Day, and
(iii) no Interest Period may end later than the Stated
Maturity Date; and
(b) relative to each Competitive Bid Loan made at a
LIBOR Auction, the period commencing on the date of such
Borrowing and ending one, two, three or six months
thereafter, as the Borrower may elect in accordance with
Section 2.4; provided that:
(i) if such Interest Period would otherwise end on a
day which is not a Business Day, such Interest Period
shall end on the next following Business Day; provided,
however, that if such next following Business Day is
the first Business Day of a calendar month, such
Interest Period shall end on the next preceding
Business Day, and
(ii) no Interest Period may end later than the Stated
Maturity Date.
No more than five Interest Periods shall be in effect at any one
time.
"Investment" means any investment in any Person, whether by
means of share purchase, capital, equity or similar contribution,
loan, advance, time deposit or otherwise (excluding commission,
travel and similar advances to officers and employees made in the
ordinary course of business). The amount of any Investment shall
be the original principal or capital amount thereof less all
returns of principal or equity thereon (and without adjustment by
reason of the financial condition of such other Person) and
shall, if made by the transfer or exchange of property other than
cash, be deemed to have been made in an original principal or
capital amount equal to the fair market value of such property,
as reasonably determined in good faith by the Borrower at the
time of such transfer or exchange.
"Invitation for Bid Loan Quotes" means an Invitation for Bid
Loan Quotes delivered by the Administrative Agent to the Lenders
pursuant to clause (b) of Section 2.4, in substantially the form
of Exhibit C-1 hereto.
"Issuance Date" is defined in Section 2.6.
"Issuance Request" means an issuance request duly completed
and executed by an Authorized Officer, substantially in the form
of Exhibit B-3 hereto.
"Issuer" means, (i) Scotiabank in its individual capacity
hereunder (and not in its capacity as a Co-Agent or the
Administrative Agent), (ii) at the request of Scotiabank and with
the Borrower's consent, another Lender issuing one or more
Letters of Credit hereunder, or (iii) at such time that the long-
term unsecured debt of Scotiabank is not rated at least AA3 or
AA- or its equivalent by Moody's Investors Service or Standard &
Poor's Corporation, respectively, at the Borrower's request and
with a Lender's consent, such Lender issuing one or more Letters
of Credit hereunder.
"Lender Assignment Agreement" means a Lender Assignment
Agreement substantially in the form of Exhibit D attached hereto.
"Lenders" is defined in the preamble.
"Letter of Credit" means the Existing Letters of Credit and
each other letter of credit issued hereunder by the Issuer for
the account of the Borrower, in form customarily used by the
Issuer and in a Stated Amount requested by the Borrower.
"Letter of Credit Commitment" means the Issuer's obligation
to issue Letters of Credit for the account of the Borrower
pursuant to Section 2.6 and, with respect to each of the other
Lenders, the obligation of each such Lender to participate in
such Letter of Credit pursuant to Section 2.6.7.
"Letter of Credit Commitment Amount" means, on any date, a
maximum amount of $30,000,000, as such amount may be reduced from
time to time pursuant to Section 2.2.
"Letter of Credit Commitment Termination Date" means the
earliest of
(a)the Stated Maturity Date;
(b) the date on which the Letter of Credit Commitment
Amount or the Loan Commitment Amount is terminated in full
or reduced to zero pursuant to Section 2.2; and
(c) the date on which any Commitment Termination
Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the
Letter of Credit Commitment shall terminate automatically and without
any further action.
"Letter of Credit Outstandings" means, on any date, an amount
equal to the sum of
(a) the then aggregate amount which is undrawn and
available under all issued and outstanding Letters of Credit
plus
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"Leverage Ratio" means, as of the last day of any Fiscal Quarter,
the ratio of
(a) Debt (other than obligations (contingent or otherwise)
relative to the face amount of all letters of credit (including
Letters of Credit), whether or not drawn, issued for the account
of the Borrower and its Subsidiaries)
to
(b) Adjusted Consolidated Tangible Net Worth.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Bid Margin" means, in respect of Competitive Bid Loans
based on a LIBOR Auction, the margin above or below the applicable
LIBO Rate offered for each such Competitive Bid Loan, expressed as a
percentage (rounded to the nearest 1/10,000th of 1%) to be added to
such rate.
"LIBO Rate Loan" means a Revolving Loan bearing interest, at all
times during an Interest Period applicable to such Revolving Loan, at
a fixed rate of interest determined by reference to the LIBO Rate
(Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Auction" means a solicitation of Competitive Bid Loan
quotes pursuant to Section 2.4 hereof based on the LIBO Rate.
"LIBOR Office" means, relative to any Lender, the office of
such Lender designated as such below its signature hereto or
designated in the Lender Assignment Agreement or such other
office of a Lender as designated from time to time by notice from
such Lender to the Borrower and the Administrative Agent, whether
or not outside the United States, which shall be making or
maintaining LIBO Rate Loans or Competitive Bid Loans based on a
LIBOR Auction.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or otherwise), charge against or interest in property
to secure payment of a debt or performance of an obligation or
other priority or preferential arrangement of any kind or nature
whatsoever.
"Loan Commitment Amount" means, on any day, $161,250,000, as
such amount may be reduced from time to time pursuant to
Section 2.2.
"Loan Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Loan Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2; and
(c) the date on which any Commitment Termination Event
occurs.
Upon the occurrence of any event described in clause (b) or (c),
the Revolving Loan Commitment shall terminate automatically and
without further action.
"Loan Document" means this Agreement, the Notes, each Letter
of Credit, the Fee Letter and each other agreement, document or
instrument delivered pursuant hereto or thereto, whether or not
mentioned herein or therein.
"Loans" means, as the context may require, either a
Competitive Bid Loan or a Revolving Loan.
"Market Value" for precious metals shall mean, as of the
date of any determination thereof, the value based on the average
of the prices of such asset, with respect to gold or silver, as
published by Handy & Harman (or if not so published by Handy &
Harman, the price as determined by the London P.M. Fix on such
date), and, with respect to platinum or palladium, as determined
by the London P.M. Fix, on each day during the three month period
ending on the date of such determination.
"Net Disposition Proceeds" means the gross proceeds received
by the Borrower or any of its Subsidiaries from the sale or other
disposition of any of their respective assets pursuant to clause
(c) of Section 7.2.11, less reasonable selling expenses incurred
in connection therewith and good faith estimated taxes payable as
a result thereof; provided that if the Borrower shall receive a
note as part of all of the consideration for such sale or other
disposition, the "Net Disposition Proceeds" shall be deemed to
include amounts payable on such note at such times as such
amounts are actually paid (provided, that an aggregate amount of
no more than $1,000,000 in any given Fiscal Year may be evidenced
by such notes); and provided, further, that in the event that the
actual taxes paid in respect of any such sale or other
disposition are less than the good faith estimated taxes at the
time of such sale, "Net Disposition Proceeds" shall be deemed to
include such difference on the date payment of such taxes is due
or the date payment of such taxes is determined not to be due.
"Net Income" means, for any period, the consolidated net
income of the Borrower and its Subsidiaries for such period
(excluding any extraordinary gains and losses).
"Non-Consenting Lender" is defined in clause (d) of
Section 2.7.2.
"Non-Recourse Joint Venture" means a joint venture (i) to
which a Non-Recourse Subsidiary is a party and (ii) whose
Indebtedness is non-recourse to the Borrower or any of its
Subsidiaries which is not the Non-Recourse Subsidiary party
thereto or any of their respective assets.
"Non-Recourse Subsidiary" means a direct or indirect
Subsidiary of the Borrower (i) which was formed solely for the
purpose of entering into a Non-Recourse Joint Venture and (ii)
whose Indebtedness is non-recourse to the Borrower or any other
Subsidiary of the Borrower or any of their respective assets.
"Note" means, as the context may require, a Competitive Bid
Loan Note or a Revolving Loan Note.
"Obligations" means all obligations (monetary or otherwise)
of the Borrower arising under or in connection with this
Agreement, the Notes, the Letters of Credit and each other Loan
Document.
"Organic Document" means, relative to the Borrower, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Participant" is defined in Section 10.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and
any entity succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is
defined in section 3(2) of ERISA, which is subject to Title IV of
ERISA (other than a multiemployer plan as defined in section
4001(a)(3) of ERISA), and to which the Borrower or any
corporation, trade or business that is, along with the Borrower,
a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within
the meaning of section 4063 of ERISA at any time during the
preceding five years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage
set forth opposite its signature hereto or set forth in the
Lender Assignment Agreement, as such percentage may be adjusted
from time to time pursuant to Lender Assignment Agreement(s)
executed by such Lender and its Assignee Lender(s) and delivered
pursuant to Section 10.11.1.
"Person" means any natural person, corporation, partnership,
firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or other
capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Quarterly Payment Date" means the last day of each March,
June, September and December or, if any such day is not a
Business Day, the next succeeding Business Day.
"Receivable" shall mean any account (as that term is defined
in Section 9-106 of the Uniform Commercial Code as in effect,
from time to time, in the State of New York) and any instrument
(as that term is defined in Section 9-105 of the Uniform
Commercial Code as in effect from time to time, in the State of
New York).
"Reference Lenders" means Scotiabank, BONY and Chemical.
"Reimbursement Obligation" is defined in Section 2.6.3.
"Release" means a "release", as such term is defined in
CERCLA.
"Replacement Notice" is defined in Section 4.11.
"Required Lenders" means, at any time,
(a) with respect to any provision of this Agreement
other than the declaration of the acceleration of the
maturity of all or any portion of the outstanding principal
amount of the Credit Extensions (after giving effect to
Section 2.6.7) and, without duplication, Letter of Credit
Outstandings and other Obligations to be due and payable
pursuant to Section 8.3, Lenders whose Percentages equal or
exceed 51%; or
(b) with respect to the declaration of the
acceleration of the maturity of all or any portion of the
outstanding principal amount of the Credit Extensions and,
without duplication, Letter of Credit Outstandings and other
Obligations to be due and payable pursuant to Section 8.3,
Lenders holding 51% or more of the aggregate principal
amount of the Credit Extensions (after giving effect to
Section 2.6.7) then outstanding.
"Resource Conservation and Recovery Act" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, et seq., as
in effect from time to time.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Borrowing" means Revolving Loans of the same
type and, in the case of LIBO Rate Loans, having the same
Interest Period, made by all Lenders on the same Business Day
pursuant to the same Revolving Loan Borrowing Request in
accordance with Section 2.1.
"Revolving Loan Borrowing Request" means a certificate
requesting Revolving Loans duly executed by an Authorized
Officer, substantially in the form of Exhibit B-1 attached
hereto.
"Revolving Loan Commitment" is defined in Section 2.1.1.
"Revolving Loan Note" means any promissory note of the
Borrower in the form of Exhibit A-1 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to
such Lender resulting from Revolving Loans outstanding from such
Lender, and also means all other promissory notes accepted from
time to time in substitution therefor or renewal thereof.
"Scotiabank" is defined in the preamble.
"Short Term Credit Agreement" means the Short Term Revolving
Credit Agreement, dated as of the date hereof (as amended,
supplemented, amended and restated or otherwise modified from
time to time), among the Borrower, the various financial
institutions as are or may become parties thereto, Scotiabank,
Chemical and BONY, as co-agents and Scotiabank, as administrative
agent.
"Stated Amount" of each Letter of Credit means the amount
available to be drawn thereunder upon the issuance thereof or, if
higher, the maximum amount that may be drawn under such Letter of
Credit prior to the Stated Expiration Date therefor.
"Stated Expiration Date" means the date on which any Letter
of Credit is stated, by its terms, to expire, which date shall in
no event be later than the earlier of one year from the date of
its issuance and the Letter of Credit Commitment Termination
Date.
"Stated Maturity Date" means September 28, 1997, as such
date may be extended pursuant to Section 2.7.
"Subject Lender" is defined in Section 4.11.
"Subsidiary" means, with respect to any Person, any
corporation of which more than 50% of the outstanding capital
stock having ordinary voting power to elect a majority of the
board of directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence
of any contingency) is at the time directly or indirectly owned
by such Person, by such Person and one or more other Subsidiaries
of such Person, or by one or more other Subsidiaries of such
Person.
"Taxes" is defined in Section 4.6.
"type" means, relative to any Loan, the portion thereof, if
any, being maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of
America, its fifty States and the District of Columbia.
"Welfare Plan" means a "welfare plan", as such term is
defined in section 3(1) of ERISA.
SECTION 1.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires, terms for which
meanings are provided in this Agreement shall have such meanings
when used in the Disclosure Schedule and in any Loan Document,
Borrowing Request, Issuance Request, Continuation/Conversion
Notice, notice and other communication delivered from time to
time in connection with this Agreement or any other Loan
Document.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Loan Document to
any Article or Section are references to such Article or Section
of this Agreement or such other Loan Document, as the case may
be, and, unless otherwise specified, references in any Article,
Section or definition to any clause are references to such clause
of such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations; No
Duplication; Consolidation. Unless otherwise specified, (i) all
accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations
hereunder or thereunder (including under Section 7.2.4) shall be
made, and all financial statements required to be delivered
hereunder or thereunder shall be prepared in accordance with,
generally accepted accounting principles in the U.S. ("GAAP"),
and (ii) all accounting determinations and computations hereunder
or under any other Loan Documents (including under Section 7.2.4)
shall be made without duplication and on a consolidated basis for
the Borrower and its Subsidiaries.
ARTICLE II
COMMITMENTS, BORROWING, BIDDING AND
ISSUANCE PROCEDURES, NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the
conditions of this Agreement (including Article V),
(a) each Lender severally agrees to make Revolving
Loans pursuant to the Revolving Loan Commitment described in
Section 2.1.1; and
(b) the Issuer agrees that it will issue Letters of
Credit pursuant to Section 2.1.3, and each other Lender
severally agrees that it will purchase participation
interests in such Letters of Credit pursuant to
Section 2.6.7.
SECTION 2.1.1. Revolving Loan Commitment. From time to
time on any Business Day occurring prior to the Loan Commitment
Termination Date, each Lender will make loans (relative to such
Lender, and of any type, its "Revolving Loans") to the Borrower
equal to such Lender's Percentage of the aggregate amount of the
Revolving Loan Borrowing requested by the Borrower to be made on
such day. The commitment of each Lender described in this
Section 2.1.1 is herein referred to as its "Revolving Loan
Commitment". On the terms and subject to the conditions hereof,
the Borrower may from time to time prior to the Loan Commitment
Termination Date borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.2. Lenders Not Permitted or Required to Make
Revolving Loans. No Lender shall be permitted or required to
make any Revolving Loan if, after giving effect thereto and to
any repayment of Credit Extensions to be made with the proceeds
thereof, the aggregate unpaid principal amount of all Loans
outstanding to all Lenders, together with the aggregate amount of
all Letter of Credit Outstandings, would exceed the Loan
Commitment Amount.
SECTION 2.1.3. Letter of Credit Commitment. From time to
time on any Business Day occurring prior to the Letter of Credit
Commitment Termination Date, the Issuer
(a) will issue one or more Letters of Credit; and
(b) may, upon request of the Borrower, extend the
Stated Expiration Date of an existing Letter of Credit
previously issued hereunder to a date not later than the
earlier of (x) the Letter of Credit Commitment Termination
Date and (y) one year from the date of such extension.
SECTION 2.1.4. Issuer Not Permitted or Required to Issue
Letters of Credit. The Issuer shall not be permitted or required
to issue any Letter of Credit if, after giving effect thereto,
(a) the aggregate amount of all Letter of Credit
Outstandings would exceed the Letter of Credit Commitment
Amount; or
(b) the sum of all Letter of Credit Outstandings plus
the aggregate unpaid principal amount of all Loans then
outstanding would exceed the Loan Commitment Amount.
SECTION 2.2. Reduction of Commitment Amounts. The
Commitment Amounts are subject to reduction from time to time
pursuant to this Section 2.2.
SECTION 2.2.1. Optional Reduction of Commitments. The
Borrower may, from time to time on any Business Day occurring
after the time of the initial Borrowing hereunder, voluntarily
reduce the Loan Commitment Amount or the Letter of Credit
Commitment Amount; provided, however, that (i) all such
reductions shall require at least three Business Days' prior
written irrevocable notice to the Administrative Agent and be
permanent, (ii) any partial reduction of (A) the Loan Commitment
Amount shall be in a minimum amount of $10,000,000 and in an
integral multiple of $1,000,000 and (B) the Letter of Credit
Commitment Amount shall be in a minimum amount of $1,000,000 and
in an integral multiple of $250,000, (iii) except as provided
below, the Loan Commitment Amount may not be so reduced to an
amount less than the then Letter of Credit Commitment Amount and
(iv) except as provided below, the Borrower may not reduce the
Letter of Credit Commitment Amount to an amount less than the
then Letter of Credit Outstandings; and provided, further, that
the Borrower may terminate the Commitments in whole if, at the
time of and as a condition of such termination, (x) the Borrower
shall have repaid in full the aggregate outstanding principal
amount of all Revolving Loans and Reimbursement Obligations,
together with all accrued interest and fees thereon to the date
of termination, and (y) all unexpired Letters of Credit shall
have been returned to the Issuer for cancellation.
SECTION 2.2.2. Mandatory Reduction of Commitments.
Immediately upon the sale, lease, transfer, contribution or
conveyance of an asset pursuant to clause (c) of Section 7.2.11,
the Loan Commitment Amount shall be automatically reduced by an
amount equal to the aggregate Net Disposition Proceeds of such
sale, lease, transfer, contribution or conveyance.
SECTION 2.3. Revolving Loan Borrowing Procedure and Funding
Maintenance. By delivering a Revolving Loan Borrowing Request to
the Administrative Agent at or before 10:00 a.m. (New York City
time), on a Business Day, the Borrower may from time to time
irrevocably request, (x) on not less than three nor more than
five Business Days' notice, in the case of LIBO Rate Loans, and
(y) on not more than five Business Days' notice (but before
10:30 a.m. (New York City time) on the date such Borrowing is to
occur), in the case of Base Rate Loans, that a Revolving Loan
Borrowing be made by all the Lenders in a minimum amount of
$10,000,000 and an integral multiple of $1,000,000, or, if less,
in the unused amount of the Revolving Loan Commitment. The
Administrative Agent shall promptly notify each Lender of the
receipt of a Revolving Loan Borrowing Request. On the terms and
subject to the conditions of this Agreement, each Revolving Loan
Borrowing shall be comprised of the type of Revolving Loans, and
shall be made on the Business Day, specified in such Revolving
Loan Borrowing Request. On or before 11:00 a.m. (New York City
time) (in the case of LIBO Rate Loans), and 12:00 (noon) (New
York City time), in the case of a Base Rate Loan, on the Business
Day that such Revolving Loan Borrowing is to be made, each Lender
shall deposit with the Administrative Agent immediately available
funds in an amount equal to such Lender's Percentage of the
requested Revolving Loan Borrowing. Such deposit will be made to
an account which the Administrative Agent shall specify from time
to time by notice to the Lenders. To the extent funds are
received from the Lenders, the Administrative Agent shall make
such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Revolving Loan
Borrowing Request. No Lender's obligation to make any Revolving
Loan shall be affected by any other Lender's failure to make any
Revolving Loan.
SECTION 2.3.1. Continuation and Conversion Elections. By
delivering a Continuation/Conversion Notice to the Administrative
Agent on or before 10:00 a.m. (New York City time), on a Business
Day, the Borrower may from time to time irrevocably elect, on not
less than three nor more than five Business Days' notice that
all, or any portion in an aggregate minimum amount of $10,000,000
and an integral multiple of $1,000,000, of any Revolving Loans
be, in the case of Base Rate Loans, converted into LIBO Rate
Loans or, in the case of LIBO Rate Loans, on the last day of an
Interest Period with respect thereto be converted into a Base
Rate Loan or continued as a LIBO Rate Loan (in the absence of
delivery of a Continuation/Conversion Notice with respect to any
LIBO Rate Loan at least three Business Days before the last day
of the then current Interest Period with respect thereto, such
LIBO Rate Loan shall, on such last day, automatically convert to
a Base Rate Loan); provided, however, that (i), except as
provided in Section 4.1, each such conversion or continuation
shall be pro rated among the applicable outstanding Revolving
Loans of all Lenders, and (ii) no portion of the outstanding
principal amount of any Revolving Loan may be continued as, or be
converted into, a LIBO Rate Loan when any Default has occurred
and is continuing.
SECTION 2.3.2. Funding. Each Lender may, if it so elects,
fulfill its obligation to make, continue or convert LIBO Rate
Loans hereunder, or to make a Competitive Bid Loan based on a
LIBOR Auction, by causing one of its foreign branches or
Affiliates (or an international banking facility created by such
Lender) to make or maintain such LIBO Rate Loan or Competitive
Bid Loan, as the case may be; provided, however, that such LIBO
Rate Loan or Competitive Bid Loan, as the case may be, shall
nonetheless be deemed to have been made and to be held by such
Lender, and the obligation of the Borrower to repay such LIBO
Rate Loan or Competitive Bid Loan, as the case may be, shall
nevertheless be to such Lender for the account of such foreign
branch, Affiliate or international banking facility. In
addition, the Borrower hereby consents and agrees that, for
purposes of any determination to be made for purposes of
Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively assumed
that each Lender elected to fund all LIBO Rate Loans and
Competitive Bid Loans based on a LIBOR Auction by purchasing
Dollar deposits in its LIBOR Office's interbank eurodollar
market.
SECTION 2.4. Competitive Bid Loans. Subject to the terms
and conditions of this Agreement (including Article V), each
Lender severally agrees that the Borrower may request that
Competitive Bid Loan Borrowings under this Section 2.4 be made
from time to time on any Business Day prior to the date occurring
15 Business Days prior to the Loan Commitment Termination Date in
the manner set forth below; provided, however, that following the
making of each Competitive Bid Loan Borrowing, the aggregate
amount of all Loans and Letter of Credit Outstandings then
outstanding shall not exceed the Loan Commitment Amount and the
Borrower hereby agrees to make a mandatory prepayment of Loans on
the date of each Competitive Bid Loan Borrowing with the proceeds
of Competitive Bid Loans to the extent necessary to reduce the
outstanding principal amount of all Loans and Letter of Credit
Outstandings (after giving effect to such Competitive Bid Loan
Borrowing) to an amount not in excess of the Loan Commitment
Amount.
(a) Competitive Bid Loan Borrowing Request. The
Borrower may request Competitive Bid Loan Borrowings under
this Section 2.4 by delivering to the Administrative Agent,
not later than 10:00 a.m. (New York City time) at least (x)
five Business Days prior to the date of the proposed
Competitive Bid Loan Borrowing (in the case of LIBOR
Auctions) or (y) one Business Day prior to the date of the
proposed Competitive Bid Loan Borrowing (in the case of an
Absolute Rate Auction), a revocable Competitive Bid Loan
Borrowing Request (which shall constitute an invitation to
the Lenders to extend Competitive Bid Loan quotes to the
Borrower, and which may contain requests for up to three
different Competitive Bid Loan Borrowings), specifying
(i)the proposed date (which shall be a Business Day)
and aggregate principal amount or amounts of each
Competitive Bid Loan to be made as part of such
proposed Competitive Bid Loan Borrowing (each of which
such Competitive Bid Loan shall be in a minimum
principal amount of $10,000,000 and in an integral
multiple of $1,000,000) (and, subject to the proviso
contained in the first sentence of this Section, which
principal amount may exceed the Loan Commitment Amount
then available to be borrowed),
(ii) whether the Competitive Bid Loan quotes requested
are to set forth a LIBO Rate Bid Margin or an Absolute
Rate (or a combination thereof),
(iii) the proposed maturity date or dates (each a
"Competitive Bid Loan Maturity Date") for repayment of
each Competitive Bid Loan to be made as part of such
Competitive Bid Loan Borrowing (which maturity date or
dates may not be later than the earlier of the date
occurring (A) six months after the date of such
Competitive Bid Loan Borrowing or (B) the Loan
Commitment Termination Date), and
(iv) in the case of Competitive Bid Loans based on the
LIBOR Auction, the proposed duration of the Interest
Period applicable thereto.
(b) Invitation for Bid Loan Quotes. Promptly upon
receipt of a Competitive Bid Loan Borrowing Request but in
no event later than 2:30 p.m. (New York City time) on the
date of such receipt, the Administrative Agent shall send to
the Lenders by facsimile an Invitation for Bid Loan Quotes
substantially in the form of Exhibit C-1 attached hereto
containing the information contained in the applicable
Competitive Bid Loan Request and which shall constitute an
invitation by the Borrower to each Lender to submit
Competitive Bid Loan quotes in response thereto.
(c) Submission and Contents of Bid Loan Quotes.
(i)If any Lender, in its sole discretion, elects to
offer to make a Competitive Bid Loan to the Borrower as
part of such proposed Competitive Bid Loan Borrowing at
a rate of interest specified by such Lender in its sole
discretion, it shall deliver to the Administrative
Agent not later than (x) 11:00 a.m. (New York City
time) on the fourth Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or
(y) 9:30 a.m. (New York City time) on the proposed date
of Borrowing, in the case of an Absolute Rate Auction,
a Competitive Bid Loan Offer, which must comply with
the requirements of this clause, in the form of Exhibit
C-2 hereto; provided, that Competitive Bid Loan quotes
submitted by the Administrative Agent (or any affiliate
of the Administrative Agent) in the capacity of a
Lender may be submitted, and may only be submitted, if
the Administrative Agent or such affiliate notifies the
Borrower of the terms of the offer or offers contained
therein not later than (x) 10:45 a.m. (New York City
time) on the fourth Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or
(y) 9:15 a.m. (New York City time) on the proposed date
of Borrowing, in the case of an Absolute Rate Auction.
Subject to Articles V and VIII, such Competitive Bid
Loan Offer shall be irrevocable except with the written
consent of the Administrative Agent, given on the
instructions of the Borrower, and shall specify
(A) the proposed date of Borrowing, which shall be the
same as that set forth in the applicable Invitation for
Bid Loan Quotes,
(B) the principal amount of the Competitive Bid Loan
which such Lender would be willing to make as part of
such proposed Competitive Bid Loan Borrowing, which
principal amount may be greater than, less than or
equal to such Lender's Percentage of the Loan
Commitment Amount, but which amount shall be in a
minimum principal amount of $5,000,000 and in an
integral multiple of $1,000,000,
(C) in the case of a LIBOR Auction, the LIBO Rate Bid
Margin, and in the case of an Absolute Rate Auction,
the Absolute Rate therefor, and
(D) the identity of the quoting Lender.
(ii) Any Competitive Bid Loan Offer that:
(A) is not substantially in the form of
Exhibit C-2 hereto or does not specify all of the
information required in clause (c) of this
Section;
(B) contains qualifying, conditional or
similar language;
(C) contains proposed terms other than or
in addition to those set forth in the applicable
Invitation for Bid Loan Quotes; or
(D) arrives after the time set forth in
clause (c) of this Section
shall be disregarded by the Administrative Agent.
(d) Notice to Borrower. The Administrative Agent
shall (by telephone confirmed by telecopy), by 1:00 p.m.
(New York City time) (on the fourth Business Day prior to
the proposed date of Borrowing, in the case of a LIBOR
Auction) and 10:00 a.m. (New York City time) (on the
proposed date of Borrowing, in the case of an Absolute Rate
Auction) notify the Borrower of the terms of any
Competitive Bid Loan Offer submitted by a Lender that is in
accordance with clause (c) of this Section. Any subsequent
Competitive Bid Loan Offer of a Lender shall be disregarded
by the Administrative Agent unless such subsequent
Competitive Bid Loan Offer is submitted solely to correct a
manifest error in such earlier Competitive Bid Loan Offer.
The Administrative Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Competitive
Bid Loans for which offers have been received in respect of
the related Invitation for Bid Loan Quotes, (B) the
respective principal amounts and Competitive Bid Rates so
offered, and (C) the identity of such quoting Lenders.
(e) Competitive Bid Loan Acceptance. The Borrower
shall, in turn, before (x) 4:00 p.m. (New York City time)
on the fourth Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction, or (y) 12:00
(noon) (New York City time) on the date of such proposed
Competitive Bid Loan Borrowing, in the case of an Absolute
Rate Auction, either
(i) irrevocably cancel the Competitive Bid Loan
Borrowing Request that requested such Competitive Bid
Loan Borrowing by giving the Administrative Agent
(which shall promptly notify each Lender) telephonic
notice (promptly confirmed in writing) to that effect
(and, for purposes of this Section, a failure on the
part of the Borrower to timely notify the
Administrative Agent under the terms of this clause
shall be deemed to be non-acceptance of all offers so
notified to it pursuant to clause (d) above), or
(ii) irrevocably accept one or more of the
offers made by any Lender or Lenders pursuant to
clause (d) above, in its sole discretion, by giving
the Administrative Agent telephonic notice (and the
Administrative Agent shall, promptly upon receiving
such telephonic notice from the Borrower, notify each
Lender whose Competitive Bid Loan Offer has been
accepted) (promptly confirmed in writing by delivery
to the Administrative Agent of a Competitive Bid Loan
Borrowing Notice, copies of which shall thereafter be
forwarded to each of the Lenders) of
(A) the amount of the Competitive Bid Loan
Borrowing to be made on such date,
and
(B) the amount of the Competitive Bid Loan
(which amount shall not be greater than, but
which may be less than, the amount offered by
such Lender for such Competitive Bid Loan
pursuant to clause (d) above) to be made by such
Lender as part of such Competitive Bid Loan
Borrowing, and reject any remaining offers made
by Lenders pursuant to clause (d) above by giving
the Administrative Agent (which shall promptly
give to the Lenders) notice to that effect;
provided, however, that
(C) the aggregate amount of the Competitive
Bid Loan Offers accepted by the Borrower shall
not exceed the principal amount specified in the
applicable Competitive Bid Loan Borrowing
Request,
(D) no Lender shall, without its prior
written consent (in its sole discretion), be
required to make a Competitive Bid Loan in a
principal amount of less than $5,000,000 and
integrals of $1,000,000;
(E) no bid shall be accepted for a
Competitive Bid Loan unless such Competitive Bid
Loan is in a minimum principal amount of
$5,000,000 (except as provided in clause (D)
above) and an integral multiple of $1,000,000 and
is part of a Competitive Bid Loan Borrowing in a
minimum principal amount of $10,000,000, and
(F) the Borrower may not accept any offer
that is described in clause (c)(ii) of this
Section, or that otherwise fails to comply with
the requirements of this Agreement.
(f) Funding of Competitive Bid Loans. Not later than
11:00 a.m. (New York City time) (in the case of a Borrowing
based on a LIBOR Auction) and 1:00 p.m. (New York City
time) (in the case of a Borrowing based on an Absolute Rate
Auction), in each case on the date specified for each
Competitive Bid Loan hereunder, each Lender participating
therein shall make available the amount of the Competitive
Bid Loan to be made by it on such date to the
Administrative Agent in immediately available funds, for
the account of the Borrower, such deposit to be made to an
account maintained by the Administrative Agent, as the
Administrative Agent shall specify from time to time by
notice to the Lenders or as otherwise agreed to in writing
by the Administrative Agent and the Borrower. The amount
so received by the Administrative Agent shall promptly be
made available to the Borrower by depositing the same in
immediately available funds in an account of the Borrower's
notified to the Administrative Agent in writing.
SECTION 2.5. Notes. Each Lender's Loans under its
Commitments shall be evidenced by a Note payable to the order of
such Lender in a maximum principal amount equal to
(a) in the case of Revolving Loans, such Lender's
Percentage of the original Loan Commitment Amount; and
(b) in the case of Competitive Bid Loans,
$100,000,000.
The Borrower hereby irrevocably authorizes each Lender to make
(or cause to be made) appropriate notations on the grid attached
to such Lender's Note (or on any continuation of such grid),
which notations, if made, shall evidence, inter alia, the date
of, the outstanding principal amount of, and the interest rate
and Interest Period (in the case of Revolving Loan Notes) and the
Competitive Bid Loan Maturity Dates and Interest Period (if
applicable) (in the case of Competitive Bid Loan Notes)
applicable to the Loans evidenced thereby. Such notations shall
be prima facie evidence of the matters stated therein, absent
manifest error; provided, however, that the failure of any Lender
to make any such notations shall not limit or otherwise affect
any Obligations of the Borrower.
SECTION 2.6. Issuing the Letters of Credit. (a) Not
later than 10:00 a.m. (New York City time) on the third Business
Day prior to the date of a requested issuance of a Letter of
Credit, and on not less than 30 nor more than 60 days' prior
notice in the case of a request for an extension of the Stated
Expiration Date of a Letter of Credit (in each case, an "Issuance
Date"), the Borrower may, by delivery to the Issuer of an
Issuance Request specifying (i) the Issuance Date, (ii) the
Stated Amount of the Letter of Credit, (iii) the Stated
Expiration Date thereof, (iv) the beneficiary of such Letter of
Credit, and (v) the terms and conditions upon which the Letter of
Credit may be drawn by the beneficiary of such Letter of Credit,
request that the Issuer issue or extend the Stated Expiration
Date of a Letter of Credit. Each Issuance Request shall be
revocable until 10:00 a.m. (New York City time) on the proposed
Issuance Date, at which time it shall become irrevocable. On the
Issuance Date and upon fulfillment of the applicable conditions
set forth in Article V, the Issuer will issue, or extend the
Stated Expiration Date of, such Letter of Credit in accordance
with its terms. All Letters of Credit shall expire not later
than the earlier to occur of one year from the Issuance Date and
the Letter of Credit Commitment Termination Date.
(b) The Existing Letters of Credit (i) to the extent still
outstanding on the Effective Date, shall automatically and
without further action of the parties hereto be deemed to be
Letters of Credit issued pursuant to this Section and shall be
subject to the provisions hereof (including with respect to the
payment of fees specified in Section 3.3.2, as if the Existing
Letters of Credit had been issued on the Effective Date),
(ii) the Stated Amount of such letters of credit shall be
included in the calculation of Letter of Credit Outstandings, and
(iii) all liabilities of the Borrower with respect to the
Existing Letters of Credit shall constitute Obligations subject
to all of the terms and conditions hereof.
SECTION 2.6.1. Drawings under the Letters of Credit. In
the event there occurs one or more drawings under any Letter of
Credit, the Issuer shall, not later than 2:00 p.m. (New York City
time) on the Business Day on which such drawing is required to be
honored pursuant to such Letter of Credit (the "Disbursement
Date"), make available to the beneficiary under such Letter of
Credit, in same day funds, the amount drawn on the Issuer
pursuant to such drawing.
SECTION 2.6.2. Reimbursement on Demand. On (or promptly
after) each Disbursement Date the Issuer shall notify the
Borrower of a drawing under a Letter of Credit, and the Issuer
will promptly thereafter furnish to the Borrower copies of (i)
each draft drawn under such Letter of Credit and (ii) each
certificate accompanying any such draft; provided, however, that
the failure to give such notice or to provide such copies shall
not affect the obligations of the Borrower hereunder. Upon
demand by the Issuer, and in any event within one Business Day
following the Disbursement Date, the Borrower will, as
reimbursement for such payment by the Issuer, immediately and
unconditionally pay to the Issuer the amount of each payment made
under each Letter of Credit; provided, however, that, if no
Default shall have then occurred and be continuing, the Borrower
may, upon notice to the Administrative Agent, which shall
promptly notify each Lender, deem the amount drawn under a Letter
of Credit to be a Revolving Loan constituting a Base Rate Loan
and each Lender (other than the Issuer) will deliver to the
Issuer immediately available funds in an amount equal to such
Lender's Percentage of such Base Rate Loan. To the extent an
amount drawn under a Letter of Credit is not so deemed to be a
Base Rate Loan, interest will accrue on any amount remaining
unpaid by the Borrower to the Issuer under this Section from the
date of demand until such amount is paid in full at an interest
rate per annum equal to 2% over the Alternate Base Rate in effect
from time to time.
SECTION 2.6.3. Obligations Absolute. The obligation (a
"Reimbursement Obligation") of the Borrower to reimburse the
Issuer with respect to each payment under each Letter of Credit,
and each Lender's obligation under Section 2.6.7 to reimburse the
Issuer, shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all
circumstances, including, without limitation, the following
circumstances:
(a) any lack of validity or enforceability of any
Letter of Credit or any related contract, instrument or
other agreement in support of which the Letter of Credit
has been issued (collectively referred to as a "Contract");
(b) any amendment or waiver of, or any consent to or
departure from, any Contract;
(c) the existence of any claim, set-off, defense or
other right which the Borrower may have at any time against
any beneficiary of any Letter of Credit (or any persons for
whom any such beneficiary may be acting), the Issuer or any
other Person, whether in connection with this Agreement,
the transactions contemplated herein or in such Letter of
Credit or any Contract or any unrelated transaction;
(d) any certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent
or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or
(e) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing.
Notwithstanding the foregoing, if the Borrower shall make payment
as above provided, the Borrower shall have a claim against the
Issuer, and the Issuer shall be liable to the Borrower, to the
extent, but only to the extent, of any direct, as opposed to
consequential, damages suffered by the Borrower as the result of
the wilful misconduct or gross negligence on the part of the
Issuer in determining whether documents presented under any
Letter of Credit comply with the terms thereof.
SECTION 2.6.4. Action in Respect of the Letters of Credit.
The Borrower assumes all risks of the acts or omissions of the
beneficiaries under the Letters of Credit with respect to their
use of the Letters of Credit. Neither the Issuer, any Agent or
any Lender, nor any of their respective officers, employees,
agents or directors shall be liable or responsible for:
(i) the use which may be made with any Letter of
Credit;
(ii) the form, sufficiency, accuracy or
genuineness of certificates or other documents
delivered under or in connection with any Letter of
Credit, even if such certificates or other documents
should prove to be insufficient, fraudulent or forged;
(iii) errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail,
cable, telex, telecopy, telegraph, wireless or
otherwise; or
(iv) errors in translation or for errors in
interpretation of technical terms.
The Issuer may accept certificates or other documents that appear
on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the
contrary. In furtherance and not in limitation of the foregoing
provisions, the Borrower agrees that, except for the Issuer's
gross negligence or wilful misconduct, any action, inaction or
omission taken or suffered by the Issuer in good faith in
connection with any Letter of Credit, or the relative drafts,
certificates or other documents, shall be binding on the Borrower
and shall not result in any liability of the Issuer to the
Borrower.
SECTION 2.6.5. Indemnification. The Borrower hereby
indemnifies and holds harmless the Issuer from and against any
and all claims, damages, losses, liabilities, costs or expenses
which the Issuer or any of its officers, employees, agents or
directors may incur or which may be claimed against the Issuer by
any person by reason of or in connection with the execution and
delivery or payment or failure to make payment under, any Letter
of Credit; provided, however, that the Borrower shall not be
required to indemnify the Issuer pursuant to this Section for any
claims, damages, losses, liabilities, costs or expenses to the
extent caused by (i) the Issuer's or any of its officers,
employees, agents or directors wilful misconduct or gross
negligence in determining whether documents presented under the
Letter of Credit comply with the terms of such Letter of Credit
or (ii) the Issuer's wilful failure to make lawful payment under
any Letter of Credit after presentation to it by a beneficiary of
a draft and certificate strictly complying with the terms and
conditions of such Letter of Credit.
SECTION 2.6.6. Deemed Disbursements. (a) Upon the
occurrence and during the continuation of any Default of the
nature set forth in Section 8.1.9, or any other Event of Default,
an amount equal to the then aggregate amount of each Letter of
Credit which is undrawn and available under all issued and
outstanding Letters of Credit shall, without demand upon or
notice to the Borrower, be deemed to have been paid or disbursed
by the Issuer under such Letters of Credit (notwithstanding that
such amount may not in fact have been so paid or disbursed); and
(b) in the case of a Default under Section 8.1.9, or in
the case of any other Event of Default upon notification by the
Administrative Agent to the Borrower of its obligations under
this Section, the Borrower shall, in each case, be immediately
obligated to reimburse the Issuer for the amount deemed to have
been so paid or disbursed by the Issuer.
Any amounts so payable by the Borrower pursuant to this Section
shall be deposited in immediately available funds in a non-
interest bearing cash collateral account maintained with the
Administrative Agent, and held as collateral security for the
Obligations, and in furtherance of the foregoing, the Borrower
hereby grants to each Lender a continuing security interest in
any and all balances, credits, deposits, accounts or moneys of
the Borrower then or thereafter maintained with such Lender;
provided that any such appropriation shall be subject to the
provisions of Section 4.8. At such time when all Defaults of the
nature set forth in Section 8.1.9 and all Events of Default shall
have been cured or waived, the Administrative Agent shall return
to the Borrower all amounts then on deposit with the
Administrative Agent pursuant to this Section which have not been
applied towards satisfaction of the Obligations.
SECTION 2.6.7. Other Lenders' Participation. Upon the
issuance of each Letter of Credit issued by the Issuer pursuant
hereto, and without further action, each Lender (other than the
Issuer) shall be deemed to have irrevocably purchased, to the
extent of its Percentage, a participation interest in such Letter
of Credit (including the Contingent Liability and any
Reimbursement Obligation with respect thereto), and such Lender
shall, to the extent of its Percentage, be responsible for
reimbursing promptly (and in any event within one Business Day)
the Issuer for Reimbursement Obligations, except to the extent
reimbursed by the Borrower in accordance with Section 2.6.2. In
addition, such Lender shall, to the extent of its Percentage, be
entitled to receive (i) a ratable portion of the fees payable to
such Lender pursuant to Section 3.3.2 with respect to each Letter
of Credit, (ii) payments of Reimbursement Obligations to the
extent such Lender has reimbursed the Issuer therefor pursuant to
this Section and (iii) interest on such reimbursement from and
after the date such Lender has funded such Reimbursement
Obligation.
SECTION 2.7. Extension of Stated Maturity Date and
Maturity of Loans. Each of (i) the Stated Maturity Date and (ii)
the obligation, pursuant to Section 3.1.1, to make a mandatory
repayment of the outstanding principal amount of Loans on the
Stated Maturity Date, shall be subject to extension or
postponement, as the case may be, as set forth in this Section.
SECTION 2.7.1. Request for Extension of Stated Maturity
Date and Maturity of Loans. Any term or provision of this
Agreement to the contrary notwithstanding, no earlier than 60
days nor later than 45 days prior to the first anniversary of the
Effective Date, or each and any successive anniversary thereof
(if the Revolving Loan Commitment then remains in effect), the
Borrower may, by delivery of a duly completed Extension Request
to the Administrative Agent, irrevocably request that each Lender
and each Issuer
(a) extend for a one year period the then existing
Stated Maturity Date relating to such Lender's Revolving
Loan Commitment; and
(b) extend for a one year period the then existing
Stated Maturity Date relating to such Issuer's Letter of
Credit Commitment and each Lender's obligation to
participate, pursuant to Section 2.6.7, in the Letters of
Credit.
SECTION 2.7.2. Consent to Extension of Stated Maturity
Date and Maturity of Loans.
(a) The Administrative Agent shall, promptly after
receipt of any such Extension Request pursuant to Section
2.7.1, notify each Lender and each Issuer thereof by
providing them a copy of such Extension Request.
(b) Each Lender and Issuer shall, within 30 days of
receipt of the notice described in clause (a), notify the
Administrative Agent whether or not it consents to the
requests of the Borrower set forth in such Extension
Request, such consent to be in the sole discretion of such
Lender or Issuer, as the case may be. Each Lender hereby
acknowledges and agrees that its consent to the Borrower's
request to extend the then existing Stated Maturity Date
shall also be deemed to be a consent by such Lender to an
extension of its obligations to participate, pursuant to
Section 2.6.7, in the Letters of Credit. If any Lender or
Issuer does not so notify the Administrative Agent of its
decision within such 30 day period, such Lender or Issuer,
as the case may be, shall be deemed not to have consented
to such requests of the Borrower.
(c) The Administrative Agent shall promptly notify
the Borrower whether the Lenders and Issuers have consented
to such request. If the Administrative Agent does not so
notify the Borrower within 5 days prior to the next
occurring anniversary of the Effective Date, the
Administrative Agent shall be deemed to have notified the
Borrower that the Lenders and Issuers have not consented to
the Borrower's request.
(d) Each Lender that elects not to provide a new
Revolving Loan Commitment upon the expiration of the then
effective Stated Maturity Date or that fails to so notify
the Administrative Agent of such consent (a "Non-Consenting
Lender") hereby agrees that if, on or prior to the then
effective Stated Maturity Date, any other Lender or other
financial institution acceptable to the Borrower and the
Administrative Agent offers to purchase such Non-Consenting
Lender's Percentage of the Revolving Loan Commitment for a
purchase price equal to the sum of all amounts then owing
with respect to the Revolving Loans and all other amounts
accrued for the account of such Non-Consenting Lender, such
Non-Consenting Lender will assign, sell and transfer on the
then effective Stated Maturity Date all of its right,
title, interest and obligations with respect to the
foregoing to such other Lender or financial institution
pursuant to the terms of Section 10.11.1, and the fee
payable pursuant to Section 10.11.1 shall be payable by
such Assignee Lender.
(e) The Revolving Loans of any Non-Consenting Lender
that were not purchased pursuant to clause (d) will mature
and be due and payable on the then scheduled Stated
Maturity Date, and the Commitments of such Non-Consenting
Lender will thereupon terminate. On such Stated Maturity
Date, the Loan Commitment Amount will be automatically
reduced by an amount equal to the product of
(i) the sum of the Percentages of all Non-
Consenting Lenders that were not purchased pursuant to
clause (d), and
(ii) the Loan Commitment Amount (whether used or
unused) on such Stated Maturity Date immediately prior
to such calculation.
(f) On the date that would have been the Stated
Maturity Date had the Revolving Loan Commitment not been
extended pursuant to the terms of this Section, the
Percentages of the remaining Lenders which have consented
to an extension of their Commitment hereunder shall be
adjusted accordingly by the Administrative Agent, based on
such Lenders' pro rata share of the remaining Loan
Commitment Amount.
Notwithstanding anything to the contrary contained in this
Section, the Stated Maturity Date of those Lenders consenting to
such an extension shall not be extended for an additional one
year period unless Lenders whose Percentages equal or exceed 75%
(after giving effect to the operation of clause (d)) have so
consented to such extension.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. Repayments and
prepayments of Loans shall be made as set forth in this Section
3.1. Each repayment or prepayment of any Loan made pursuant to
this Section 3.1 shall be without premium or penalty, except as
may be required by Section 4.4. No voluntary prepayment of
principal of any Revolving Loans shall cause a reduction in the
Loan Commitment Amount.
SECTION 3.1.1. Final Maturity. The Borrower shall repay
in full the entire unpaid principal amount of each Revolving Loan
upon the Stated Maturity Date therefor and each Competitive Bid
Loan upon the Competitive Bid Loan Maturity Date therefor.
SECTION 3.1.2. Voluntary Prepayments. From time to time
on any Business Day prior to the Stated Maturity Date, the
Borrower may make a voluntary prepayment, in whole or in part, of
the outstanding principal amount of any Revolving Loans;
provided, however, that
(a) any such prepayment of Revolving Loans shall be
made pro rata among Revolving Loans of the same type and,
if applicable, having the same Interest Period of all
Lenders;
(b) no such prepayment of any LIBO Rate Loan or a
Competitive Bid Loan may be made on any day other than the
last day of the Interest Period for such Loan, unless the
Borrower shall have given the Administrative Agent at least
two (but no more than five) Business Days' notice, and has
paid any costs required pursuant to Section 4.4;
(c) all such voluntary prepayments shall require at
least one but no more than five Business Days' prior
written notice to the Administrative Agent, which shall
promptly notify the Lenders; and
(d) all such voluntary partial prepayments shall be
in an aggregate minimum amount of $10,000,000 and an
integral multiple of $500,000.
SECTION 3.1.3. Mandatory Prepayments. On each date when
the sum of (i) the aggregate outstanding principal amount of all
outstanding Loans (after giving effect to the use of proceeds of
any Borrowing made on such date) and (ii) Letter of Credit
Outstandings exceeds the Loan Commitment Amount, as it may have
been reduced pursuant to Section 2.2 or 2.7.2, the Borrower shall
make a mandatory prepayment of all Loans equal to the excess, if
any, of the amount of such sum over the Loan Commitment Amount.
SECTION 3.1.4. Acceleration of Stated Maturity Date.
Immediately upon any acceleration of the Stated Maturity Date of
any Loans pursuant to Section 8.2 or Section 8.3, the Borrower
shall repay all Loans to the full extent of such acceleration.
SECTION 3.2. Interest Provisions. Interest on the
outstanding principal amount of Loans shall accrue and be payable
in accordance with this Section 3.2.
SECTION 3.2.1. Rates. Pursuant to an appropriately
delivered Borrowing Request or Continuation/Conversion Notice,
the Borrower may elect that Loans comprising a Borrowing accrue
interest at any of the following rates per annum:
(i) On that portion of such Borrowing maintained as
Base Rate Loans, such rate shall be equal to the Alternate
Base Rate from time to time in effect;
(ii) On that portion of such Borrowing maintained as
LIBO Rate Loans, during each Interest Period applicable
thereto, such rate shall be equal to the sum of the LIBO
Rate (Reserve Adjusted) for such Interest Period plus a
margin of 1%; and
(iii) On that portion of such Borrowing maintained as
Competitive Bid Loans, equal to the applicable Competitive
Bid Rate specified by the Lender making such Competitive
Bid Loan in its Competitive Bid Loan Offer with respect
thereto delivered by such Lender and accepted by the
Borrower pursuant to Section 2.4.
The "LIBO Rate (Reserve Adjusted)" means, relative to any
Loan to be made, continued or maintained as, or converted into, a
LIBO Rate Loan for any Interest Period, a rate per annum (rounded
upwards, if necessary, to the nearest 1/16 of 1%) determined
pursuant to the following formula:
LIBO Rate = LIBO Rate
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period
for LIBO Rate Loans will be determined by the Administrative
Agent on the basis of the LIBOR Reserve Percentage in effect on,
and the applicable rates furnished to and received by the
Administrative Agent from the Reference Lenders two Business Days
before the first day of such Interest Period, subject, however,
to the last sentence contained in the definition of "LIBO Rate".
"LIBO Rate" means, relative to any Interest Period, the
rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at
which Dollar deposits in immediately available funds are offered
to each Reference Lender's LIBOR Office in the London interbank
market as at or about 11:00 a.m. (London time), two Business Days
prior to the beginning of such Interest Period for delivery on
the first day of such Interest Period, and in an amount
approximately equal to the amount of each such Reference Lender's
LIBO Rate Loan in the case of Revolving Loans, and, in the case
of Competitive Bid Loans based on a LIBOR Auction, determined as
if each Reference Lender were participating in such Competitive
Bid Loan in an amount equal to such Reference Lender's Percentage
of the principal amount of the Competitive Bid Loan being
requested, and for a period approximately equal to such Interest
Period. In furtherance of the foregoing, each Reference Lender
agrees to furnish to the Administrative Agent timely information
for the purpose of determining each LIBO Rate. If any one or
more of the Reference Lenders shall fail timely to furnish such
information to the Administrative Agent for any such interest
rate, the Administrative Agent shall determine such interest rate
on the basis of the information furnished by the remaining
Reference Lenders.
"LIBOR Reserve Percentage" means, relative to any Interest
Period for LIBO Rate Loans, the reserve percentage (expressed as
a decimal) equal to the average maximum reserve requirements of
the Lenders (without giving effect to the branch or agency in
which such Lender funds such Loans) (including all basic,
emergency, supplemental, marginal and other reserves and taking
into account any transitional adjustments or other scheduled
changes in reserve requirements) specified under regulations
issued from time to time by the F.R.S. Board and then applicable
to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D
of the F.R.S. Board, having a term approximately equal or
comparable to such Interest Period.
All LIBO Rate Loans and Competitive Bid Loans based on a
LIBOR Auction shall bear interest from and including the first
day of the applicable Interest Period to (but not including) the
last day of such Interest Period at the interest rate determined
as applicable to such LIBO Rate Loan or Competitive Bid Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any
principal amount of any Loan or Reimbursement Obligation is due
and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise), or after any other monetary
Obligation of the Borrower shall have become due and payable, the
Borrower shall pay interest (after as well as before judgment) on
such amounts at a rate per annum equal to the Alternate Base Rate
plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each
Loan shall be payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) other than in the case of Base Rate Borrowings,
on the date of any payment or prepayment, in whole or in
part, of principal outstanding on such Loan on the amount
prepaid;
(c) with respect to Base Rate Loans, on each
Quarterly Payment Date occurring after the initial
Borrowing hereunder;
(d) with respect to Competitive Bid Loans based on an
Absolute Rate, on each Competitive Bid Loan Maturity Date
and, with respect to Competitive Bid Loans based on an
Absolute Rate with a Competitive Bid Loan Maturity Date in
excess of three months, on each Quarterly Payment Date
occurring after the making of such Loan;
(e) with respect to LIBO Rate Loans and Competitive
Bid Loans based on a LIBOR Auction, the last day of each
applicable Interest Period (and, if such Interest Period
shall exceed three months, on each three month anniversary
of such Interest Period);
(f) with respect to any Base Rate Loans converted
into LIBO Rate Loans on a day when interest would not
otherwise have been payable pursuant to clause (c), on the
date of such conversion; and
(g) on that portion of any Loans the Stated Maturity
Date of which is accelerated pursuant to Section 8.2 or
Section 8.3, immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations,
including Reimbursement Obligations, arising under this Agreement
or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration
or otherwise) shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees
set forth in this Section 3.3. All such fees shall be non-
refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay
to the Administrative Agent for the pro rata account of each
Lender, an ongoing commitment fee at the rate of 3/8 of 1% per
annum of the sum of the average daily unused portion of the Loan
Commitment Amount (such unused Loan Commitment Amount to be
computed without giving effect to any outstanding principal
amount of Competitive Bid Loans and giving effect to the Letter
of Credit Outstandings), such fee to accrue for the period
commencing on the Effective Date until the Loan Commitment
Termination Date (including any period thereof when any
availability under the Commitment is suspended by reason of the
Borrower's inability to satisfy any condition of Article V).
Such commitment fees shall be payable by the Borrower in arrears
on each Quarterly Payment Date, commencing with the first such
day following the Effective Date, and on the Commitment
Termination Date.
SECTION 3.3.2. Letter of Credit Fee. The Borrower agrees
to pay (x) to the Administrative Agent, for the pro rata account
of the Issuer and each other Lender, a Letter of Credit fee in an
amount equal to 7/8 of 1% per annum of the Stated Amount of each
Letter of Credit, and (y) to the Issuer, for its own account, an
issuing fee in the amount of 1/4 of 1% per annum of such Stated
Amount and the Issuer's other customary administrative and
issuance costs and expenses, such amounts to be payable quarterly
in arrears on each Quarterly Payment Date following the issuance
of such Letter of Credit until the expiration date of such Letter
of Credit, and on such expiration date.
SECTION 3.3.3. Agents' Fee. The Borrower agrees to pay to
the Administrative Agent, for the Administrative Agent's own
account, those fees, in the amounts and on the dates, set forth
in the Fee Letter.
SECTION 3.3.4. Certain Other Fees. The Borrower agrees to
pay to the Administrative Agent for the account of the up-front
fees in the amounts and payable as agreed upon by the Borrower
and the Administrative Agent, and the Administrative Agent agrees
to pay to each Lender the up-front fee previously agreed to
between the Administrative Agent and each Lender.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender
shall determine (which determination, upon notice thereof to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Borrower), absent manifest error, shall be prima facie evidence
of the facts stated therein) that the introduction of or any
change in or in the interpretation of any law makes it unlawful,
or any central bank or other governmental authority asserts that
it is unlawful, for such Lender to make, continue or maintain any
Loan as, or to convert any Loan into, a LIBO Rate Loan, or to
make or maintain any Competitive Bid Loan based on a LIBOR
Auction, the obligations of such Lender to make, continue,
maintain or convert any such Loans shall, upon such
determination, forthwith be suspended until such Lender shall
notify the Administrative Agent that the circumstances causing
such suspension no longer exist (which notification such Lender
agrees to give as promptly as practicable when such circumstances
no longer exist), and all LIBO Rate Loans of such Lender shall
automatically convert into Base Rate Loans at the end of the then
current Interest Periods with respect thereto or sooner, if
required by such law or assertion. If any Lender shall make such
determination with respect to the making or maintaining a
Competitive Bid Loan based on a LIBOR Auction and such
Competitive Bid Loan is required by law or assertion to be
prepaid on a date prior to the end of the Interest Period
therefor, then the Borrower shall prepay such Competitive Bid
Loan on such date.
SECTION 4.2. Deposits Unavailable. If the Administrative
Agent shall have determined that
(a) Dollar deposits in the relevant amount and for
the relevant Interest Period are not available to the
Reference Lenders in their relevant market; or
(b) by reason of circumstances affecting the
Reference Lenders or the relevant market, adequate means do
not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans or Competitive Bid Loans based
on a LIBOR Auction,
then, upon notice from the Administrative Agent to the Borrower
and the Lenders, the obligations of all Lenders under Section
2.3.1 and Section 2.3.2 to make or continue any Loans as, or to
convert any Loans into, LIBO Rate Loans or the right of the
Borrower to solicit any Competitive Bid Loans based on a LIBOR
Auction shall forthwith be suspended until the Administrative
Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The
Borrower agrees to reimburse each Lender for any increase in the
cost to such Lender of, or any reduction in the amount of any sum
receivable by such Lender in respect of, making, continuing or
maintaining (or of its obligation to make, continue or maintain)
any Loans as, or of converting (or of its obligation to convert)
any Revolving Loans into, LIBO Rate Loans or Competitive Bid
Loans based on LIBOR Auctions. Such Lender shall promptly notify
the Administrative Agent in writing (which notice the
Administrative Agent agrees it will as promptly as practicable
forward to the Borrower) of the occurrence of any such event,
such notice to state, in reasonable detail, the reasons therefor
and the additional amount required fully to compensate such
Lender for such increased cost or reduced amount. Such
additional amounts shall be payable by the Borrower directly to
such Lender within five days of its receipt of such notice, and
such notice shall, in the absence of manifest error, be prima
facie evidence of the matters stated therein. If the Borrower is
requested to pay increased costs by any Lender (the "Affected
LIBO Lender") pursuant to this Section, the Borrower may, by
telephonic notice (promptly confirmed in writing) to the
Administrative Agent (which shall give prompt notice thereof to
the Affected LIBO Lender),
(a) as to any outstanding LIBO Rate Loans of such
Affected LIBO Lender, prepay such Loan in full, without
premium or penalty (other than as may be provided in
Section 4.4), but with such increased costs as well as any
accrued interest to the date of such prepayment on the
principal amount prepaid, without simultaneously making a
prepayment of the Loans of each other Lender and
simultaneously borrow a Base Rate Loan in an equal
principal amount (without the necessity that the conditions
set forth in Section 5.2 are met), and
(b) with respect to any Borrowing Request or
Continuation/Conversion Notice, request such Affected LIBO
Lender (i) to make the LIBO Rate Loan then or thereafter
subject to a Borrowing Request as a Base Rate Loan, or
(ii) to maintain the outstanding Base Rate Loan or LIBO
Rate Loan of such Lender then or thereafter the subject of
a Continuation/Conversion Notice as a Base Rate Loan.
SECTION 4.4. Funding Losses. In the event any Lender
shall incur any loss or expense (including any loss or expense
incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by such Lender to make, continue or
maintain any portion of the principal amount of any Loan as a
LIBO Rate Loan or a Competitive Bid Loan based on a LIBOR
Auction, or to convert any portion of the principal amount of any
Revolving Loan into, a LIBO Rate Loan) as a result of
(a) any repayment or prepayment of the principal
amount of any LIBO Rate Loans or Competitive Bid Loans
based on LIBOR Auctions or any conversion of a LIBO Rate
Loan on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Loans (i) not being made as, or (ii) being
made as Loans other than as, LIBO Rate Loans or Competitive
Bid Loans based on LIBOR Auctions, in each case, in
accordance with the Revolving Loan Borrowing Request or
Competitive Bid Loan Acceptance therefor, as the case may
be; or
(c) any Revolving Loans not being continued as, or
converted into, LIBO Rate Loans in accordance with the
Continuation/Conversion Notice therefor,
then, following the written notice of such Lender to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Borrower), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the
reasonable determination of such Lender) reimburse such Lender
for such loss or expense. Such written notice (which shall
include calculations in reasonable detail) shall, in the absence
of manifest error, be prima facie evidence of the matters stated
therein.
SECTION 4.5. Increased Capital Costs. If any change in,
or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority affects or would affect the amount of
capital required or expected to be maintained by any Lender or
any Person controlling such Lender, and such Lender determines
(in its sole and absolute discretion) that the rate of return on
its or such controlling Person's capital as a consequence of its
Commitment or the Loans made by or Letters of Credit issued or
participated in by such Lender is reduced to a level below that
which such Lender or such controlling Person could have achieved
but for the occurrence of any such circumstance, then, in any
such case upon notice from time to time by such Lender to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Borrower), the Borrower shall promptly, and in any event within
five days of its receipt of such notice, pay directly to such
Lender additional amounts sufficient to compensate such Lender or
such controlling Person for such reduction in rate of return. A
statement of such Lender as to any such additional amount or
amounts (including calculations thereof in reasonable detail)
shall, in the absence of manifest error, be prima facie evidence
of the matters stated therein. In determining such amount, such
Lender may use any method of averaging and attribution that it
(in its sole and absolute discretion) shall deem applicable.
SECTION 4.6. Taxes. All payments by the Borrower of
principal of, and interest on, the Loans and all other amounts
payable hereunder (including in respect of fees and Reimbursement
Obligations) shall be made free and clear of and without
deduction for any present or future income, excise, stamp or
franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing
authority, but excluding franchise taxes and taxes imposed on or
measured by any Lender's net income or receipts imposed by the
jurisdiction of incorporation or organization of such Lender or
the jurisdiction where such Lender has its Domestic Office or
LIBOR Office (such non-excluded items being called "Taxes"). In
the event that any withholding or deduction from any payment to
be made by the Borrower hereunder is required in respect of any
Taxes pursuant to any applicable law, rule or regulation, then
the Borrower will
(a) pay directly to the relevant authority the full
amount required to be so withheld or deducted;
(b) promptly forward to the Administrative Agent an
official receipt or other documentation satisfactory to the
Administrative Agent evidencing such payment to such
authority; and
(c) pay to the Administrative Agent for the account
of the Lenders such additional amount or amounts as is
necessary to ensure that the net amount actually received
by each Lender will equal the full amount such Lender would
have received had no such withholding or deduction been
required.
Moreover, if the Administrative Agent or any Lender is obligated
to pay any Taxes with respect to any payment received by the
Administrative Agent or such Lender hereunder, the Administrative
Agent or such Lender may pay such Taxes and the Borrower will
promptly pay such additional amounts as is necessary in order
that the net amount received by such Person after the payment of
such Taxes (including any Taxes on such additional amount) shall
equal the amount such Person would have received had such Taxes
not been asserted.
If the Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the
Administrative Agent, for the account of the respective Lenders,
the required receipts or other required documentary evidence, the
Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a
result of any such failure. For purposes of this Section 4.6, a
distribution hereunder by the Administrative Agent or any Lender
to or for the account of any Lender shall be deemed a payment by
the Borrower.
Upon the request of the Borrower or the Administrative
Agent, each Lender that is organized under the laws of a
jurisdiction other than the United States or a State thereof
shall, prior to the due date of any payments under the Notes,
execute and deliver to the Borrower and the Administrative Agent,
on or about the first scheduled payment date in each Fiscal Year,
one or more (as the Borrower or the Administrative Agent may
reasonably request) United States Internal Revenue Service Forms
4224 or Forms 1001 or such other forms or documents (or successor
forms or documents), appropriately completed, as may be
applicable to establish the extent, if any, to which a payment to
such Lender is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless
otherwise expressly provided, all payments by the Borrower
pursuant to this Agreement, the Notes, each Letter of Credit or
any other Loan Document shall be made by the Borrower to the
Administrative Agent for the pro rata account of the Lenders
entitled to receive such payment. All such payments required to
be made to the Administrative Agent shall be made, without
setoff, deduction or counterclaim, not later than 11:00 a.m.
(New York City time), on the date due, in immediately available
funds, to such account as the Administrative Agent shall specify
from time to time by notice to the Borrower. Funds received
after that time shall be deemed to have been received by the
Administrative Agent on the next succeeding Business Day. The
Administrative Agent shall promptly remit in same day funds to
each Lender its share, if any, of such payments received by the
Administrative Agent for the account of such Lender. All
interest and fees shall be computed on the basis of the actual
number of days (including the first day but excluding the last
day) occurring during the period for which such interest or fee
is payable over a year comprised of 360 days (or, in the case of
interest on a Base Rate Loan, 365 days or, if appropriate, 366
days). Whenever any payment to be made shall otherwise be due on
a day which is not a Business Day, such payment shall (except as
otherwise required by clause (a)(i) of the definition of the term
"Interest Period" with respect to LIBO Rate Loans and clause
(a)(ii) of the definition of "Interest Period" with respect to
Competitive Bid Loans based on the LIBOR Auction) be made on the
next succeeding Business Day and such extension of time shall be
included in computing interest and fees, if any, in connection
with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall
obtain any payment or other recovery (whether voluntary,
involuntary, by application of setoff or otherwise) on account of
any Loan or Reimbursement Obligation (other than pursuant to the
terms of Sections 4.3, 4.4, 4.5, 4.6 and 10.3) in excess of its
pro rata share of payments then or therewith obtained by all
Lenders, such Lender shall purchase from the other Lenders such
participations in Credit Extensions made by them as shall be
necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; provided,
however, that if all or any portion of the excess payment or
other recovery is thereafter recovered from such purchasing
Lender, the purchase shall be rescinded and each Lender which has
sold a participation to the purchasing Lender shall repay to the
purchasing Lender the purchase price to the ratable extent of
such recovery together with an amount equal to such selling
Lender's ratable share (according to the proportion of
(a) the amount of such selling Lender's required
repayment to the purchasing Lender
to
(b) the total amount so recovered from the purchasing
Lender)
of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights of payment (including
pursuant to Section 4.9) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower
in the amount of such participation. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives
a secured claim in lieu of a setoff to which this Section
applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders entitled under this
Section to share in the benefits of any recovery on such secured
claim.
SECTION 4.9. Setoff. Each Lender shall, upon the
occurrence of any Default described in clauses (a) through (d) of
Section 8.1.9 or, with the consent of the Required Lenders, upon
the occurrence of any other Event of Default, have the right to
appropriate and apply to the payment of the Obligations owing to
it (whether or not then due) any and all balances, credits,
deposits, accounts or moneys of the Borrower then or thereafter
maintained with such Lender; provided, however, that any such
appropriation and application shall be subject to the provisions
of Section 4.8. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such setoff and
application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such
setoff and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including
other rights of setoff under applicable law or otherwise) which
such Lender may have.
SECTION 4.10. Use of Proceeds. The Borrower shall apply
the proceeds of the Credit Extensions to refinance and repay in
full the Indebtedness described in Item 5.1.3 ("Indebtedness to
be Paid or Replaced") of the Disclosure Schedule, to deem the
Existing Letters of Credit to be Letters of Credit hereunder and
for the general corporate purposes of the Borrower and its
Subsidiaries; without limiting the foregoing, no proceeds of any
Loan will be used and no Letter of Credit will be requested or
issued in violation of F.R.S. Board Regulation U.
SECTION 4.11. Replacement of Lenders. Each Lender hereby
severally agrees that if such Lender (a "Subject Lender") makes a
demand upon the Borrower for (or if the Borrower is otherwise
required to pay) amounts pursuant to Section 4.3, Section 4.5 or
Section 4.6, the Borrower may, within 90 days of receipt by the
Borrower of such demand (or the occurrence of such other event
causing the Borrower to be required to pay such compensation)
give notice (a "Replacement Notice") in writing to the
Administrative Agent and such Lender of its intention to replace
such Lender with a financial institution designated in such
Replacement Notice. If the Administrative Agent shall, in the
exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice, notify the Borrower and such
Subject Lender in writing that the designated financial
institution is satisfactory to the Administrative Agent, then
such Lender shall, so long as no Default shall have occurred and
be continuing, assign, in accordance with Section 10.11.1, all of
its Commitments, Loans, Notes and other rights and obligations
under this Agreement and all other Loan Documents (including,
without limitation, Reimbursement Obligations) to such designated
financial institution; provided, however, that (i) such
assignment shall be without recourse, representation or warranty
and shall be on terms and conditions reasonably satisfactory to
such Lender and such designated financial institution and (ii)
the purchase price paid by such designated financial institution
shall be in the amount of such Lender's Loans and its Percentage
of outstanding Reimbursement Obligations, together with all
accrued and unpaid interest and fees in respect thereof, plus all
other amounts (including the amounts demanded and unreimbursed
under Section 4.3, 4.5 or 4.6, as the case may be), owing to the
Subject Lender hereunder. Upon the effective date of such
Assignment, the Borrower shall issue a replacement Note or Notes,
as the case may be, to such designated financial institution and
such institution shall become a "Lender" for all purposes under
this Agreement and the other Loan Documents. The Administrative
Agent agrees to use all commercially reasonable efforts to assist
the Borrower in locating a replacement financial institution to
replace any Subject Lender; provided, however, that the Borrower
agrees to pay all reasonable costs and expenses (and the fee
payable to the Administrative Agent pursuant to Section 10.11.1)
incurred by the Administrative Agent in providing such
assistance.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of
the Lenders to fund the initial Borrowing and of the Issuer to
issue Letters of Credit on and after the Effective Date shall be
subject to the prior or concurrent satisfaction of each of the
conditions precedent set forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Administrative Agent
shall have received from the Borrower a certificate, dated the
date of the initial Credit Extension, of its Secretary or
Assistant Secretary as to
(a) resolutions of its Board of Directors then in
full force and effect authorizing the execution, delivery
and performance of this Agreement, the Notes and each other
Loan Document to be executed by it;
(b) true and complete copies of the Borrower's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement,
the Notes and each other Loan Document executed by it,
upon which certificate each Lender may conclusively rely until it
shall have received a further certificate of the Secretary of the
Borrower canceling or amending such prior certificate.
SECTION 5.1.2. Delivery of Notes. The Administrative
Agent shall have received, for the account of each Lender, such
Lender's Revolving Notes and its Competitive Bid Loan Notes duly
executed and delivered by the Borrower.
SECTION 5.1.3. Payment of Outstanding Indebtedness, etc.
All Indebtedness identified in Item 5.1.3 ("Indebtedness to be
Paid or Replaced") of the Disclosure Schedule, together with all
interest, all prepayment premiums and other amounts due and
payable with respect thereto, shall have been paid in full
(including, to the extent necessary, from proceeds of the initial
Credit Extension) and all commitments thereunder shall have been
terminated, and evidence thereof shall have been delivered to the
Administrative Agent; and all Liens (if any) securing payment of
any such Indebtedness have been released and the Administrative
Agent shall have received all Uniform Commercial Code Form UCC-3
termination statements or other instruments as may be suitable or
appropriate in connection therewith.
SECTION 5.1.4. Opinions of Counsel. The Administrative
Agent shall have received opinions, dated the date of the initial
Credit Extension and addressed to the Administrative Agent, the
Co-Agents and all Lenders, from
(a) Paul E. Dixon, Vice President and General Counsel
of the Borrower, substantially in the form of Exhibit H
hereto (and the Borrower hereby expressly instructs such
counsel to deliver such opinion to the Administrative Agent
and the Lenders); and
(b) Mayer, Brown & Platt, counsel to the
Administrative Agent, substantially in the form of
Exhibit I hereto (and the Administrative Agent hereby
expressly instructs such counsel to deliver such opinion to
the Lenders).
SECTION 5.1.5. Closing Fees, Expenses, etc. The
Administrative Agent shall have received for its own account, or
for the account of each Lender, as the case may be, all fees,
costs and expenses due and payable pursuant to Sections 3.3 and
10.3, if then invoiced.
SECTION 5.1.6. Termination of Existing Agreement. The
Administrative Agent shall have received a termination letter in
form and substance satisfactory to it executed and delivered by
the Borrower to the effect that the Existing Agreement has been
terminated and that the Lenders (under and as defined in the
Existing Agreement) have no further obligations under the
Existing Agreement.
SECTION 5.2. All Credit Extensions. The obligation of
each Lender and the Issuer to fund any Loan or to issue any
Letter of Credit on the occasion of any Borrowing and issuance of
any Letter of Credit, as the case may be (including the initial
Credit Extension) shall be subject to the satisfaction of each of
the conditions precedent set forth in this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default,
etc. Both before and after giving effect to any Credit Extension
(but, if any Default of the nature referred to in Section 8.1.5
shall have occurred with respect to any other Indebtedness,
without giving effect to any application, directly or indirectly,
of the proceeds thereof to cure such Default) the following
statements shall be true and correct
(a) the representations and warranties set forth in
Article VI (excluding, however, those contained in Section
6.7 for any Credit Extension occurring after the initial
Borrowing hereunder) shall be true and correct in all
material respects with the same effect as if then made
(unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be
true and correct as of such earlier date);
(b) except as disclosed by the Borrower to the
Administrative Agent and the Lenders pursuant to
Section 6.7
(i) no litigation, arbitration or governmental
investigation or proceeding shall be pending or, to
the knowledge of the Borrower, threatened against the
Borrower or any of its Subsidiaries which may
reasonably be expected to materially adversely affect
the Borrower's, or the Borrower and its Subsidiaries'
taken as a whole, businesses, operations, assets,
revenues, properties or prospects or which purports to
affect the legality, validity or enforceability of
this Agreement, the Notes or any other Loan Document;
and
(ii) no development shall have occurred in any
litigation, arbitration or governmental investigation
or proceeding disclosed pursuant to Section 6.7 which
may reasonably be expected to materially adversely
affect the businesses, operations, assets, revenues,
properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole;
(c) the sum of (x) the aggregate outstanding
principal amount of all Loans and, without duplication,
(y) all Letter of Credit Outstandings does not exceed the
Loan Commitment Amount; and
(d) no Default shall have then occurred and be
continuing, and neither the Borrower nor any of its
Subsidiaries are in material violation of any law or
governmental regulation or court order or decree the
violation of which would have a material adverse effect on
businesses, operations, assets, revenues, properties or
prospects of the Borrower or the Borrower and its
Subsidiaries, taken as a whole.
SECTION 5.2.2. Credit Extension Request. The
Administrative Agent shall have received a Borrowing Request, if
Loans are being requested, or an Issuance Request, if the
Borrower is requesting that a Letter of Credit be issued or
extended, for such Credit Extension. Each of the delivery of a
Borrowing Request or Issuance Request, as the case may be, and
the acceptance by the Borrower of the proceeds or the receipt of
the benefit of such Credit Extension shall constitute a
representation and warranty by the Borrower that on the date of
such Credit Extension (both immediately before and after giving
effect to such Credit Extension and the application of the
proceeds thereof) the statements made in Section 5.2.1 are true
and correct.
SECTION 5.2.3. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto by or on behalf of the
Borrower or any of its Subsidiaries in connection with such
Credit Extension shall be satisfactory in form and substance to
the Administrative Agent and its counsel; the Administrative
Agent and its counsel shall have received all information,
approvals, opinions, documents or instruments as the
Administrative Agent or its counsel may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders, the Issuer, the Co-Agents
and the Administrative Agent to enter into this Agreement and to
make Credit Extensions hereunder, the Borrower represents and
warrants to each such party as set forth in this Article VI.
SECTION 6.1. Organization, etc. The Borrower and each of
its Subsidiaries is a corporation or partnership validly
organized and existing and in good standing under the laws of the
State of its incorporation or organization, is duly qualified to
do business and is in good standing as a foreign corporation or
partnership in each jurisdiction where the nature of its business
requires it to be so qualified except where such failure would
not, singly or in the aggregate, have a material adverse effect
on the Borrower's or the Borrower and its Subsidiaries', taken as
a whole, financial condition, operations, assets, businesses,
properties or prospects, and has full power and authority and
holds all requisite governmental licenses, permits and other
approvals to (i) enter into and perform its Obligations under
this Agreement, the Notes and each other Loan Document and (ii)
to own and hold under lease its property and to conduct its
business substantially as currently conducted by it, except for
the failure to hold such licenses, permits or other approvals
which such failure would not, singly or in the aggregate, have a
material adverse effect on the financial condition, operations,
assets, businesses, properties or prospects of the Borrower or
the Borrower and its Subsidiaries taken as a whole.
SECTION 6.2. Due Authorization, Non-Contravention, etc.
The execution, delivery and performance by the Borrower of this
Agreement, the Notes and each other Loan Document executed or to
be executed by it, are within the Borrower's corporate powers,
have been duly authorized by all necessary corporate action, and
do not
(a) contravene the Borrower's Organic Documents;
(b) contravene any contractual restriction, law or
governmental regulation or court decree or order binding on
or affecting the Borrower; or
(c) result in, or require the creation or imposition
of, any Lien on any of the Borrower's properties.
SECTION 6.3. Government Approval, Regulation, etc. No
authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or
other Person is required for the due execution, delivery or
performance by the Borrower of this Agreement, the Notes or any
other Loan Document. Neither the Borrower nor any of its
Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 6.4. Validity, etc. This Agreement constitutes,
and the Notes and each other Loan Document executed by the
Borrower will, on the due execution and delivery thereof,
constitute, the legal, valid and binding obligations of the
Borrower enforceable in accordance with their respective terms,
except that the enforceability thereof may be subject to
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and the effect
of general principles of equity.
SECTION 6.5. Financial Information. The balance sheets of
the Borrower and each of its Subsidiaries as at December 31,
1993, March 31, 1994 and June 30, 1994 and the related statements
of earnings and cash flow of the Borrower and each of its
Subsidiaries, copies of which have been furnished to the
Administrative Agent and each Lender, have been prepared in
accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the corporations covered
thereby as at the dates thereof and the results of their
operations for the periods then ended.
SECTION 6.6. No Material Adverse Change. Since the date
of the latest financial statements described in Section 6.5,
there has been no material adverse change in the financial
condition, operations, assets, business, properties or prospects
of the Borrower or its Subsidiaries.
SECTION 6.7. Litigation, etc. There is no pending or, to
the knowledge of the Borrower, threatened litigation, action or
proceeding affecting the Borrower or any of its Subsidiaries, or
any of their respective properties, businesses, assets or
revenues, which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
business, properties or prospects of the Borrower, or the
Borrower and its Subsidiaries, taken as a whole, or which
purports to affect the legality, validity or enforceability of
this Agreement, the Notes or any other Loan Document, except as
disclosed in Item 6.7 ("Litigation") of the Disclosure Schedule.
SECTION 6.8. Subsidiaries. The Borrower has no
Subsidiaries, except those Subsidiaries
(a) which are identified in Item 6.8 ("Existing
Subsidiaries") of the Disclosure Schedule; or
(b) which are permitted to have been acquired or
created in accordance with Section 7.2.5 or 7.2.10.
SECTION 6.9. Ownership of Properties. The Borrower and
each of its Subsidiaries owns good and marketable title to all of
its real properties and good title to all its personal property
and other assets, tangible and intangible, of any nature
whatsoever (including patents, trademarks, trade names, service
marks and copyrights), free and clear of all Liens, charges or
claims (including infringement claims with respect to patents,
trademarks, copyrights and the like) except as permitted pursuant
to Section 7.2.3 or disclosed pursuant to Section 6.7.
SECTION 6.10. Taxes. The Borrower and each of its
Subsidiaries has filed all tax returns and reports required by
law to have been filed by it and has paid all taxes and
governmental charges thereby shown to be owing, except any such
taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP shall have been set aside on its books.
SECTION 6.11. Pension and Welfare Plans. During the
twelve-consecutive-month period prior to the date of the
execution and delivery of this Agreement and prior to the date of
any Credit Extension hereunder, no steps have been taken to
terminate any Pension Plan, and no contribution failure has
occurred with respect to any Pension Plan sufficient to give rise
to a Lien under section 302(f) of ERISA. No condition exists or
event or transaction has occurred with respect to any Pension
Plan which might result in the incurrence by the Borrower or any
member of the Controlled Group of any material liability, fine or
penalty. Except as disclosed in Item 6.11 ("Employee Benefit
Plans") of the Disclosure Schedule, neither the Borrower nor any
member of the Controlled Group has any contingent liability with
respect to any post-retirement benefit under a Welfare Plan,
other than liability for continuation coverage described in Part
6 of Title I of ERISA.
SECTION 6.12. Environmental Warranties. To the best
knowledge of the Borrower, after all reasonable inquiry:
(a) all facilities and property (including underlying
groundwater) owned or leased by the Borrower or any of its
Subsidiaries have been, and continue to be, owned or leased
by the Borrower or the Borrower and its Subsidiaries in
material compliance with all Environmental Laws except for
such noncompliance, that singly or in the aggregate, does
not have or may not reasonably be expected to have a
materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(b) there have been no past, and there are no pending
or threatened
(i) claims, complaints, notices or requests for
information received by the Borrower or any of its
Subsidiaries with respect to any alleged violation of
any Environmental Law, or
(ii) complaints, notices or inquiries to the
Borrower or any of its Subsidiaries regarding
potential liability under any Environmental Law,
that, singly or in the aggregate, have, or may reasonably
be expected to have, a materially adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(c) there have been no Releases of Hazardous
Materials at, on or under any property now owned or leased
or, to the knowledge of the Borrower, previously owned or
leased, by the Borrower or any of its Subsidiaries that,
singly or in the aggregate, have, or may reasonably be
expected to have, a material adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(d) the Borrower and its Subsidiaries have been
issued and are in material compliance with all permits,
certificates, approvals, licenses and other authorizations
relating to environmental matters and necessary for their
businesses except such permits, certificates, approvals,
licenses and authorizations the absence of which will not,
singly or in the aggregate, have or may reasonably be
expected to have, a materially adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(e) neither the Borrower nor any Subsidiary of the
Borrower has received notification that any property now or
previously owned or leased by the Borrower or any of its
Subsidiaries is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS
or on any similar state list of sites requiring
investigation or clean-up except for (i) as disclosed in
Item 6.12 ("Environmental Warranties") of the Disclosure
Schedule and (ii) such properties as disclosed by the
Borrower to the Lenders pursuant to clause (b)(i) (B)(I) of
Section 7.1.6 and for which the Borrower's or such
Subsidiaries' liability in respect thereof is not singly or
in the aggregate, reasonably expected to have a material
adverse effect on the financial condition, operations,
assets, businesses, properties or prospects of the Borrower
or the Borrower and its Subsidiaries, taken as a whole;
(f) there is no liability related to offsite
transport, treatment or disposal of Hazardous Material
generated or handled by the Borrower or any of its
Subsidiaries except for such liability that singly, or in
the aggregate, which may not reasonably be expected to have
a materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(g) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under
any property now or, to the knowledge of the Borrower,
previously, owned or leased by the Borrower or any of its
Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a material adverse effect
on the financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(h) neither the Borrower nor any Subsidiary of the
Borrower has directly transported or directly arranged for
the transportation of any Hazardous Material to any
location which is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS
or on any similar state list or which is the subject of
federal, state or local enforcement actions or other
investigations which may lead to material claims against
the Borrower or such Subsidiary thereof for any remedial
work, damage to natural resources or personal injury,
including claims under CERCLA, which claims singly or in
the aggregate, may reasonably be expected to have a
material adverse effect on the financial condition,
operations, assets, businesses, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(i) there are no polychlorinated biphenyls or friable
asbestos present at any property now or previously, owned
or leased by the Borrower or any Subsidiary of the Borrower
that, singly or in the aggregate, have, or may reasonably
be expected to have, a material adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole; and
(j) other than as stated above, no conditions exist
at, on or under any property now or previously, owned or
leased by the Borrower which, with the passage of time, or
the giving of notice or both, would give rise to liability
under any Environmental Law that, singly or in the
aggregate, have or may reasonably be expected to have a
materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole.
SECTION 6.13. Regulations G, U and X. Neither the
Borrower nor any Subsidiary is engaged in the business of
extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loan will be used and no Letters of
Credit will be requested or issued for a purpose which violates,
or would be inconsistent with, F.R.S. Board Regulation G, U or X.
Terms for which meanings are provided in F.R.S. Board
Regulation G, U or X or any regulations substituted therefor, as
from time to time in effect, are used in this Section with such
meanings.
SECTION 6.14. Accuracy of Information. All factual
information heretofore or contemporaneously furnished by or on
behalf of the Borrower in writing to any Agent, the Issuer or any
Lender for purposes of or in connection with this Agreement or
any transaction contemplated hereby is, and all other such
factual information hereafter furnished by or on behalf of the
Borrower to any Agent, the Issuer or any Lender will be, true and
accurate in every material respect on the date as of which such
information is dated or certified and, if heretofore delivered,
as of the date of execution and delivery of this Agreement by the
Administrative Agent, the Issuer, any Co-Agent and such Lender,
and such information is not, or shall not be, as the case may be,
incomplete by omitting to state any material fact necessary to
make such information not misleading.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees
with the Issuer, the Co-Agents, the Administrative Agent and each
Lender that, until all Letters of Credit have been terminated or
have expired, all Commitments have terminated and all Obligations
have been paid and performed in full, the Borrower will perform
the obligations set forth in this Section 7.1.
SECTION 7.1.1. Financial Information, Reports, Notices,
etc. The Borrower will furnish, or will cause to be furnished,
to each Lender, the Issuer and the Administrative Agent copies of
the following financial statements, reports, notices and
information:
(a) as soon as available and in any event within
45 days after the end of each of the first three Fiscal
Quarters of each Fiscal Year of the Borrower, consolidated
balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Quarter and consolidated statements
of earnings and cash flow of the Borrower and its
Subsidiaries for such Fiscal Quarter and for the period
commencing at the end of the previous Fiscal Year and
ending with the end of such Fiscal Quarter, certified by
the chief financial Authorized Officer of the Borrower;
(b) as soon as available and in any event within
90 days after the end of each Fiscal Year of the Borrower,
a copy of the annual audit report for such Fiscal Year for
the Borrower and its Subsidiaries, including therein
consolidated balance sheets of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and
consolidated statements of earnings and cash flow of the
Borrower and its Subsidiaries for such Fiscal Year, in each
case certified (without any Impermissible Qualification) in
a manner acceptable to the Administrative Agent and the
Required Lenders by KMPG Peat Marwick or other independent
public accountants reasonably acceptable to the
Administrative Agent and the Required Lenders, together
with a certificate from such accountants containing a
computation of, and showing compliance with, each of the
financial ratios and restrictions contained in
Section 7.2.4;
(c) as soon as available and in any event within
45 days after the end of each Fiscal Quarter, a completed
Compliance Certificate, which shall also include a
statement as to (i) the total market value of precious
metal held on consignment by the Borrower and its
Subsidiaries, (ii) the total number of ounces of precious
metal held on consignment at each Plant (as defined in the
Consignment Facilities) under the terms of the Consignment
Facilities, and (iii) the total number of ounces of U.S.
Bullion (as defined in the Consignment Facilities) located
at each Plant;
(d) as soon as possible and in any event within five
days after the occurrence of each Default, a statement of
the chief financial Authorized Officer setting forth
details of such Default and the action which the Borrower
has taken and proposes to take with respect thereto;
(e) as soon as possible and in any event within three
days after (x) the occurrence of any material adverse
development with respect to any litigation, action or
proceeding described in Section 6.7 or (y) the commencement
of any litigation, action or proceeding of the type
described in Section 6.7, notice thereof and copies of all
documentation relating thereto;
(f) promptly after the sending or filing thereof,
copies of all reports which the Borrower sends to any of
its security holders, and all reports and registration
statements without exhibits incorporated by reference
therein which the Borrower or any of its Subsidiaries files
with the Securities and Exchange Commission or any national
securities exchange;
(g) immediately upon becoming aware of the
institution of any steps by the Borrower or any other
Person to terminate any Pension Plan, or the failure to
make a required contribution to any Pension Plan if such
failure is sufficient to give rise to a Lien under section
302(f) of ERISA, or the taking of any action with respect
to a Pension Plan which could result in the requirement
that the Borrower furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event
with respect to any Pension Plan which could result in the
incurrence by the Borrower of any material liability, fine
or penalty, or any material increase in the contingent
liability of the Borrower with respect to any post-
retirement Welfare Plan benefit, notice thereof and copies
of all documentation relating thereto; and
(h) such other information respecting the condition
or operations, financial or otherwise, of the Borrower or
any of its Subsidiaries as any Lender through the
Administrative Agent may from time to time reasonably
request.
SECTION 7.1.2. Compliance with Laws, etc. The Borrower
will, and will cause each of its Subsidiaries to, comply in all
material respects with all applicable laws, rules, regulations
and orders, such compliance to include (without limitation):
(a) the maintenance and preservation of its corporate
existence and qualification as a foreign corporation except
where the failure to so qualify would not have a material
adverse effect on the financial condition, operations,
assets, business, properties or prospects of the Borrower
or the Borrower and its Subsidiaries, taken as a whole, as
the case may be; and
(b) the payment, before the same become delinquent,
of all taxes, assessments and governmental charges imposed
upon it or upon its property except to the extent being
diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 7.1.3. Maintenance of Properties. The Borrower
will, and will cause each of its Subsidiaries to, maintain,
preserve, protect and keep those of its properties in good
repair, working order and condition, and make necessary useful or
necessary and proper repairs, renewals and replacements so that
its business carried on in connection therewith may be properly
conducted at all times unless the Borrower determines in good
faith that the continued maintenance of any of its properties is
no longer economically desirable.
SECTION 7.1.4. Insurance. The Borrower will, and will
cause each of its Subsidiaries to, maintain or cause to be
maintained with responsible insurance companies insurance with
respect to its properties and business against such casualties
and contingencies and of such types and in such amounts as is
customary in the case of similar businesses and will, upon request of
the Administrative Agent, furnish to each Lender at reasonable
intervals a certificate of an Authorized Officer setting forth the
nature and extent of all insurance maintained by the Borrower and its
Subsidiaries in accordance with this Section.
SECTION 7.1.5. Books and Records. The Borrower will, and will
cause each of its Subsidiaries to, keep books and records which
accurately reflect all of its business affairs and transactions and
permit the Administrative Agent and each Lender or any of their
respective representatives, at reasonable times and intervals, to
visit all of its offices, to discuss its financial matters with its
officers and independent public accountant (and the Borrower hereby
authorizes such independent public accountant to discuss the
Borrower's financial matters with each Lender or its representatives
whether or not any representative of the Borrower is present) and to
examine any of its books or other corporate records. The Borrower
shall pay any fees of such independent public accountant incurred in
connection with the Administrative Agent's (on behalf of the Lender's)
exercise of its rights pursuant to this Section; provided, that after
the occurrence and during the continuation of a Default, the expenses
of a Lender (other than the Administrative Agent) exercising its
rights pursuant to this Section shall be for the account of the
Borrower. In addition, following the delivery of any notification
required pursuant to clause (b)(i) of Section 7.1.6, the Borrower
agrees to permit the Administrative Agent to discuss with the relevant
authorities the status and formation of plans in respect of such
claims, complaints, notices or inquiries, and to attend any meeting or
otherwise be present at conferences with management of the Borrower
and consult with their outside environmental consultants and engineers
(and the Borrower hereby authorizes such environmental consultants and
engineers to discuss such environmental matters with the
Administrative Agent or its representatives whether or not any
representative of the Borrower is present) in connection therewith,
all at the Borrower's expense.
SECTION 7.1.6. Environmental Covenant. The Borrower will, and
will cause each of its Subsidiaries to,
(a) use and operate all of its facilities and properties
in material compliance with all Environmental Laws, keep all
necessary permits, approvals, certificates, licenses and other
authorizations relating to environmental matters in effect and
remain in material compliance therewith, and handle all
Hazardous Materials in material compliance with all applicable
Environmental Laws;
(b) (i) immediately notify the Administrative Agent (A)
and provide copies upon receipt of all material written claims,
complaints, notices or inquiries relating to the environmental
condition of its facilities and properties or non-compliance
with Environmental Laws which could singly or in the aggregate,
reasonably be expected to have a material adverse effect on the
financial condition, operations, assets, businesses, properties
or prospects of the Borrower or the Borrower and its
Subsidiaries, taken as a whole and (B) (I) of the listing or
proposal for listing of any property owned or leased by the
Borrower or any of its Subsidiaries on the National Priorities
List pursuant to CERCLA, on the CERCLIS or on any similar state
list of sites requiring investigation or cleanup and (II) upon
its determination by the Borrower or its Subsidiary, as the case
may be, of the estimate of the amount of the liability of the
Borrower or such Subsidiary with respect to any such property,
and, (ii) shall either diligently contest or pursue settlement
of, in good faith and by appropriate proceedings, or promptly
undertake to correct such condition or non-compliance and have
dismissed any such actions and proceedings relating to
compliance with Environmental Laws; and
(c) provide such information and certifications which the
Administrative Agent may reasonably request from time to time to
evidence compliance with this Section 7.1.6.
SECTION 7.2. Negative Covenants. The Borrower agrees with the
Issuer, the Co-Agents, the Administrative Agent and each Lender that,
until all Letters of Credit have been terminated or have expired, all
Commitments have terminated and all Obligations have been paid and
performed in full, the Borrower will perform the obligations set forth
in this Section 7.2.
SECTION 7.2.1. Business Activities. The Borrower will not, and
will not permit any of its Subsidiaries to, engage in any business
activity which is substantially different from those described in the
first recital and such activities as may be incidental or related
thereto.
SECTION 7.2.2. Designated Debt, Letters of Credit; Subsidiary
Debt. (a) The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist or otherwise
become or be liable in respect of any Designated Debt or Indebtedness
in respect of letters of credit (whether or not drawn), other than
(i) in the case of Designated Debt, to the extent that the
aggregate amount of Designated Debt does not exceed the sum of:
(A) 90% of the Market Value of the gold, silver and
platinum group metals and the gold, silver and platinum
group metals' content of alloys then owned by the Borrower
and its Subsidiaries in inventory and not held under
consignment,
plus
(B) 75% of Eligible Receivables of the Borrower and
its Subsidiaries;
plus
(C) 100% of the cash and Cash Equivalent Investments
of the Borrower and its Subsidiaries, but only to the
extent that such cash and Cash Equivalent Investments are
not subject to any Lien and (if held or owned by a
Subsidiary) are transferable to the Borrower without the
consent or approval of any other Person; and
(ii) in the case of Indebtedness in respect of letters of
credit (whether or not drawn),
(A) the Letters of Credit; and
(B) Indebtedness in respect of other letters of
credit in an aggregate face amount not to exceed 10% of
Adjusted Consolidated Tangible Net Worth.
(b) Notwithstanding clause (a) above or clause (b) of Section
7.2.4, no Subsidiary of the Borrower shall create, incur, assume or
suffer to exist or otherwise become or be liable in respect of any
Debt except:
(i) Debt existing on the Effective Date and described in
Item 7.2.2(b) ("Existing Subsidiary Debt") of the Disclosure
Schedule; and
(ii) Debt which in the aggregate for all such Subsidiaries
does not exceed 10% of Adjusted Consolidated Tangible Net Worth.
SECTION 7.2.3. Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon any of its property, revenues or assets (including
any capital stock of the Borrower's Subsidiaries), whether now owned
or hereafter acquired, except:
(a) Liens securing Indebtedness of a Subsidiary to the
Borrower;
(b) Liens granted prior to the Effective Date to secure
payment of Indebtedness identified in Item 7.2.3(b) ("Ongoing
Indebtedness") and 7.2.2(b) ("Existing Subsidiary Debt") of the
Disclosure Schedule;
(c) Liens for taxes, assessments or other governmental
charges or levies not at the time delinquent or thereafter
payable without penalty or being diligently contested in good
faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP shall have been set aside on its books;
(d) Liens of carriers, warehousemen, mechanics,
materialmen and landlords incurred in the ordinary course of
business for sums not overdue or being diligently contested in
good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on
its books;
(e) Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance
or other forms of governmental insurance or benefits, or to
secure performance of tenders, statutory obligations, leases and
contracts (other than for borrowed money) entered into in the
ordinary course of business or to secure obligations on surety
or appeal bonds;
(f) judgment Liens in existence less than 15 days after
the entry thereof or with respect to which execution has been
stayed or the payment of which is covered in full (subject to a
customary deductible) by insurance maintained with responsible
insurance companies;
(g) easements, rights-of-way, zoning and similar
restrictions and other similar charges or encumbrances not
interfering with the ordinary conduct of the business of the
Borrower or any of its Subsidiaries and which do not impair
materially the use thereof by the Borrower or any of its
Subsidiaries;
(h) Liens existing on the property of Subsidiaries on the
date such Subsidiary is acquired which Lien was not incurred in
connection with or in contemplation of the acquisition of such
Subsidiary;
(i) Liens on assets acquired by the Borrower or any
Subsidiary existing at the time of acquisition of such asset
which Liens are not created in connection with or in
contemplation of such acquisition and which do not attach to any
other assets of the Borrower or such Subsidiary, as the case may
be;
(j) Liens on properties the underlying amount secured
thereby which do not in the aggregate at any one time exceed 20%
of Adjusted Consolidated Tangible Net Worth less the amount
secured by Liens of properties so encumbered by Liens permitted
under clauses (b), (h) and (i) above, and clause (l) below;
(k) leases or subleases granted to other Persons not
materially interfering with the conduct of the business of the
Borrower or any Subsidiary;
(l) renewals and extensions of any of the foregoing so
long as the Indebtedness secured thereby does not increase; and
(m) Liens granted in connection with the consignment of
precious metal to be located at the Plants (as defined in the
Consignment Facilities) under the terms of the Consignment
Facilities and related documents executed in connection
therewith.
SECTION 7.2.4. Financial Condition. The Borrower will not
permit:
(a) its Adjusted Consolidated Tangible Net Worth as at the
last day of any Fiscal Quarter during any period set forth below
to be less than the amount set forth opposite such period:
Adjusted Consolidated
Period Tangible Net Worth
07/01/94 through 09/30/94 128,000,000
10/01/94 through 12/31/94 130,000,000
01/01/95 and thereafter 130,000,000 plus 25% of
the Borrower's Net Income
for the immediately
preceding Fiscal Year;
(b) its Leverage Ratio as of the last day of any
Fiscal Quarter to be greater than 1.70:1.00; and
(c) the Interest Coverage Ratio as at the last day of
any Fiscal Quarter during any period set forth below to be
less than the ratio set forth opposite such period:
Interest
Period Coverage Ratio
07/01/94 through 09/30/94 1.90:1.00
10/01/94 through 12/31/94 2.00:1.00
01/01/95 through 03/31/95 2.10:1.00
04/01/95 through 06/30/95 2.20:1.00
07/01/95 and each Fiscal Quarter
thereafter 2.25:1.00
SECTION 7.2.5. Investments. The Borrower will not, and
will not permit any of its Subsidiaries to, make, incur, assume
or suffer to exist any Investment in any other Person, except:
(a) Investments existing on the Effective Date and
identified in Item 7.2.5(a) ("Ongoing Investments") of the
Disclosure Schedule;
(b) Cash Equivalent Investments;
(c) without duplication, all Investments made or
committed to be made as Capital Expenditures;
(d) in the ordinary course of business, Investments
by the Borrower in any of its Subsidiaries existing as of
the date of this Agreement, or by any such Subsidiary in
any of its Subsidiaries existing as of the date of this
Agreement, by way of contributions to capital or loans or
advances;
(e) Investments taken in satisfaction of
Indebtedness, provided, that the aggregate amount of such
Investments shall not exceed $1,000,000 in any Fiscal Year
of the Borrower;
(f) Investments in other Persons engaged in business
activities which are substantially the same as those
described in the first recital and such activities as may
be incidental or related thereto, provided that upon making
such Investment such Person becomes a Subsidiary of the
Borrower and such Investment is made solely with cash or
the issuance of the Borrower's capital stock (or a
combination thereof); and
(g) other Investments in an aggregate amount at the
time of determination not to exceed 5% of Adjusted
Consolidated Tangible Net Worth;
provided, however, that
(h) any Investment which when made complies with the
requirements of the definition of the term "Cash Equivalent
Investment" may continue to be held notwithstanding that
such Investment if made thereafter would not comply with
such requirements; and
(i) no Investment otherwise permitted by clause (d),
(e), (f) or (g) shall be permitted to be made if,
immediately before or after giving effect thereto, any
Default shall have occurred and be continuing.
SECTION 7.2.6. Restricted Payments, etc. On and at all
times after the Effective Date:
(a) the Borrower will not declare, pay or make any
dividend or distribution (in cash, property or obligations)
on any shares of any class of capital stock (now or
hereafter outstanding) of the Borrower or on any warrants,
options or other rights with respect to any shares of any
class of capital stock (now or hereafter outstanding) of
the Borrower (other than dividends or distributions payable
in its common stock or warrants to purchase its common
stock or splitups or reclassifications of its stock into
additional or other shares of its common stock and other
than ordinary cash dividends made on a quarterly basis in
respect of the outstanding common stock of the Borrower,
but only to the extent that both before and after giving
effect to the payment of such dividends, no Event of
Default shall have occurred and be continuing) or apply, or
permit any of its Subsidiaries to apply, any of its funds,
property or assets to the purchase, redemption, sinking
fund or other retirement of, or agree or permit any of its
Subsidiaries to purchase or redeem, any shares of any class
of capital stock (now or hereafter outstanding) of the
Borrower, or warrants, options or other rights with respect
to any shares of any class of capital stock (now or
hereafter outstanding) of the Borrower; provided that the
Borrower may purchase shares of its capital stock so long
as before and after giving effect to such purchase no
Default has occurred and is continuing or is created
thereby; and
(b) the Borrower will not, and will not permit any
Subsidiary to, make any deposit for any of the foregoing
purposes, except to the extent any such cash dividend on
the Borrower's common stock is permitted in accordance with
clause (a) of this Section.
SECTION 7.2.7. Transactions with Affiliates. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into, or cause, suffer or permit to exist any arrangement or
contract with any of its other Affiliates (other than the
Borrower or any of its Subsidiaries) unless such arrangement or
contract is fair and equitable to the Borrower or such Subsidiary
and is an arrangement or contract of the kind which would be
entered into by a prudent Person in the position of the Borrower
or such Subsidiary with a Person which is not one of its
Affiliates.
SECTION 7.2.8. Long Term Rental Obligations. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into at any time any arrangement (other than the Consignment
Facilities) exceeding three years in duration which does not
create a Capitalized Lease Liability and which involves the
leasing by the Borrower or any of its Subsidiaries from any
lessor of any real or personal property (or any interest
therein), except arrangements which, together with all other such
arrangements which shall then be in effect, will not require the
payment of an aggregate amount of rentals by the Borrower and its
Subsidiaries in excess of an amount equal to (excluding
escalations resulting from a rise in the consumer price or
similar index) 5% of Adjusted Consolidated Tangible Net Worth
measured at the time of the incurrence of such obligation;
provided, however, that any calculation made for purposes of this
Section shall exclude any amounts required to be expended for
maintenance and repairs, insurance, taxes, assessments, and other
similar charges.
SECTION 7.2.9. Take or Pay Contracts. The Borrower will
not, and will not permit any of its Subsidiaries to, enter into
or be a party to any arrangement for the purchase of materials,
supplies, other property or services if such arrangement by its
express terms requires that payment be made by the Borrower or
such Subsidiary regardless of whether such materials, supplies,
other property or services are delivered or furnished to it.
SECTION 7.2.10. Consolidation, Merger, etc. The Borrower
will not, and will not permit any of its Subsidiaries to,
liquidate or dissolve, consolidate with, or merge into or with,
any other corporation, or purchase or otherwise acquire all or
substantially all of the assets of any Person (or of any division
thereof) except
(a) any such Subsidiary may liquidate or dissolve
voluntarily into, and may merge with and into, the Borrower
or any other Subsidiary, and the assets or stock of any
Subsidiary may be purchased or otherwise acquired by the
Borrower or any other Subsidiary;
(b) the Borrower may merge or consolidate with any
other corporation, provided that (i) the Borrower shall be
the continuing or surviving corporation, or, if the
Borrower is not the surviving corporation, then the
successor corporation shall be a solvent corporation
organized under the laws of any State of the United States
of America and shall expressly assume in a writing
satisfactory in form and substance to the Required Lenders,
all of the obligations of the Borrower under this Agreement
and under the Notes, including all covenants herein and
therein contained, and such successor corporation shall
succeed to and be substituted for the Borrower with the
same effect as if it had been a party hereto, (ii) after
giving effect to such merger or consolidation the Borrower
as the continuing or surviving corporation or the successor
corporation could incur an additional $1.00 of Designated
Debt under clause (a)(i) of Section 7.2.2, (iii) no Default
shall have occurred and be continuing and, after giving
effect to such merger or consolidation, no Default would
occur and be continuing and (iv) after giving effect to
such merger or consolidation, at least 75% of the gold,
silver and platinum group metals and the gold, silver and
platinum group metals' content of alloys then held by the
Borrower in inventory (and not under consignment), taken at
their Market Value, and at least 75% of the book value of
all of the other assets of the Borrower, shall be located
within the United States;
(c) so long as no Default has occurred and is
continuing or would occur after giving effect thereto, the
Borrower or any of its Subsidiaries may purchase all or
substantially all of the assets of any Person, or acquire
such Person by merger, if made as a Capital Expenditure or
by Investment if permitted (without duplication) by Section
7.2.5.
SECTION 7.2.11. Asset Dispositions, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, sell,
transfer, lease, contribute or otherwise convey, or grant
options, warrants or other rights with respect to, any of its
assets (including accounts receivable and capital stock of
Subsidiaries) to any Person, unless
(a) such sale, transfer, lease, contribution or
conveyance is in the ordinary course of its business or is
permitted by Section 7.2.10;
(b) the assets subject to such sale, transfer, lease,
contribution or conveyance are identified as discontinued
operations or otherwise identified as assets to be disposed
in the Borrower's Current Report on Form 8-K, dated June
27, 1991;
(c) if such sale, transfer, lease, contribution or
conveyance is not in the ordinary course of business and
not otherwise permitted hereunder, the assets are sold for
fair value (as determined by the Board of Directors of the
Borrower or the Subsidiary owning such assets); or
(d) the aggregate book value or market value, if
higher (determined as to particular assets as of the
respective date of disposition thereof) (other than in
accordance with clauses (a), (b) and (c) above) of all
assets sold, transferred, leased, contributed or otherwise
conveyed by the Borrower and its Subsidiaries (i) since the
Effective Date, does not exceed 10% of the consolidated
assets of the Borrower as of the Effective Date, and (ii)
does not constitute assets which contributed more than 10%
of operating profit contribution during any of the three
most recently completed Fiscal Years of the Borrower.
SECTION 7.2.12. Restrictive Agreements, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into any agreement (excluding this Agreement, any other Loan
Document, the Short Term Credit Agreement, the Consignment
Facilities and any agreement governing any Indebtedness in
existence on the Effective Date as in effect on the Effective
Date) prohibiting
(a) the ability of the Borrower to amend or otherwise
modify this Agreement or any other Loan Document; or
(b) the ability of any Subsidiary to make any
payments, directly or indirectly, to the Borrower by way of
dividends, advances, repayments of loans or advances,
reimbursements of management and other intercompany
charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which
restricts the ability of any such Subsidiary to make any
payment, directly or indirectly, to the Borrower.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 8.1
shall constitute an "Event of Default".
SECTION 8.1.1. Non-Payment of Obligations. (a) The
Borrower shall default in the payment or prepayment when due of
(i) any principal of any Loan, or (ii) any Reimbursement
Obligation or any deposit of cash in an account notified to the
Borrower by the Administrative Agent pursuant to Section 2.6.6;
or (b) the Borrower shall default (and such default shall
continue unremedied for a period of three Business Days) in the
payment when due of any interest on any Loan or fee or of any
other Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or
warranty of the Borrower made or deemed to be made hereunder or
in any other Loan Document or any other writing or certificate
furnished by or on behalf of the Borrower to the Administrative
Agent or any Lender for the purposes of or in connection with
this Agreement or any such other Loan Document (including any
certificates delivered pursuant to Article V) is or shall be
incorrect when made or deemed made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and
Obligations. The Borrower shall default in the due performance
and observance of any of its obligations under Section 7.2 or
Section 7.1.6.
SECTION 8.1.4. Non-Performance of Other Covenants and
Obligations. The Borrower shall default in the due performance
and observance of any other agreement contained herein or in any
other Loan Document (other than as set forth in Section 8.1.1 or
8.1.3), and such default shall continue unremedied for a period
of 10 Business Days after notice thereof shall have been given to
the Borrower by the Administrative Agent or any Lender.
SECTION 8.1.5. Default on Other Indebtedness or
Agreements. A default shall occur in the payment when due
(subject to any applicable grace period), whether by acceleration
or otherwise, of any Indebtedness (other than Indebtedness
described in Section 8.1.1) of the Borrower or any of its
Subsidiaries having a principal amount, individually or in the
aggregate, in excess of $1,000,000, or a default shall occur in
the performance or observance of any obligation or condition with
respect to such Indebtedness if the effect of such default is to
accelerate the maturity of any such Indebtedness or such default
shall continue unremedied for any applicable period of time
sufficient to permit the holder or holders of such Indebtedness,
or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed
maturity or any Event of Default (as defined in any of the
Consignment Facilities or the Short Term Credit Agreement) shall
have occurred and be continuing under any of the Consignment
Facilities or the Short Term Credit Agreement, respectively.
SECTION 8.1.6. Judgments. Any judgment or order for the
payment of money in excess of $1,000,000 (excluding that portion
of a judgment covered by insurance as to which such insurance
carrier has acknowledged liability) shall be rendered against the
Borrower or any of its Subsidiaries or Affiliates (including
joint ventures) and either
(a) enforcement proceedings shall have been commenced
by any creditor upon such judgment or order; or
(b) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall
not be in effect.
SECTION 8.1.7. Pension Plans. Any of the following events
shall occur with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any
member of its Controlled Group or any other Person to
terminate a Pension Plan if, as a result of such
termination, the Borrower or any such member could be
required to make a contribution to such Pension Plan, or
could reasonably expect to incur a liability or obligation
to such Pension Plan, in excess of $1,000,000; or
(b) a contribution failure occurs with respect to any
Pension Plan sufficient to give rise to a Lien under
Section 302(f) of ERISA.
SECTION 8.1.8. Control of the Borrower. Any Change in
Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower
or any of its Subsidiaries (including joint ventures) shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Borrower or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of
a trustee, receiver, sequestrator or other custodian for
the Borrower or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall
not be discharged within 60 days, provided that the
Borrower, each Subsidiary and each joint venture hereby
expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any relevant
proceeding during such 60-day period to preserve, protect
and defend their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or
any dissolution, winding up or liquidation proceeding, in
respect of the Borrower or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Borrower or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in
by the Borrower or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed, provided that the Borrower,
each Subsidiary and each such joint venture hereby
expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any such case or
proceeding during such 60-day period to preserve, protect
and defend their rights under the Loan Documents; or
(e) take any action authorizing, or in furtherance
of, any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Borrower, the value of whose assets in
the aggregate for the Fiscal Quarter most recently ended
accounted for an amount equal to or less than 5% of Adjusted
Consolidated Tangible Net Worth.
SECTION 8.2. Action if Bankruptcy. If any Event of
Default described in clauses (a) through (d) of Section 8.1.9
shall occur, the Commitments of each Lender (if not theretofore
terminated) shall automatically terminate, the Stated Maturity
Date shall automatically be accelerated and the outstanding
principal amount of all outstanding Loans, Letter of Credit
Outstandings and all other Obligations shall automatically be and
become immediately due and payable, without notice or demand.
SECTION 8.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 8.1.9) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders,
shall by notice to the Borrower declare the Stated Maturity Date
to be accelerated and/or direct the Administrative Agent to
declare all or any portion of the outstanding principal amount of
the Loans, Letter of Credit Outstandings and other Obligations to
be due and payable and/or the Commitments of each Lender (if not
theretofore terminated) to be terminated, whereupon the Stated
Maturity Date shall be accelerated, the full unpaid amount of
such Loans, Letter of Credit Outstandings and other Obligations
which shall be so declared due and payable shall be and become
immediately due and payable, without further notice, demand or
presentment, and/or, as the case may be, the Commitments shall
terminate.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints each of
Scotiabank, and Chemical as its Co-Agent, and Scotiabank as its
Administrative Agent, under and for purposes of this Agreement,
the Notes and each other Loan Document. Each Lender authorizes
Scotiabank, in its capacity as the Administrative Agent, to act
on behalf of such Lender under this Agreement, the Notes and each
other Loan Document in such capacity and, in the absence of other
written instructions from the Required Lenders received from time
to time by the Administrative Agent (with respect to which the
Administrative Agent agrees that it will comply, except as
otherwise provided in this Section or as otherwise advised by
counsel), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent
by the terms hereof and thereof, together with such powers as may
be reasonably incidental thereto. Each Lender hereby indemnifies
(which indemnity shall survive any termination of this Agreement)
the Administrative Agent, pro rata according to such Lender's
Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever to the extent not otherwise paid by the
Borrower which may at any time be imposed on, incurred by, or
asserted against, the Administrative Agent in any way relating to
or arising out of this Agreement, the Notes and any other Loan
Document, including reasonable attorneys' fees, and as to which
the Administrative Agent is required to be, but is not reimbursed
by the Borrower; provided, however, that no Lender shall be
liable for the payment of any portion of such liabilities,
obligations, losses, damages, claims, costs or expenses which are
determined to have resulted solely from the Administrative
Agent's gross negligence or wilful misconduct. The
Administrative Agent shall not be required to take any action
hereunder, under the Notes or under any other Loan Document
except such actions expressly provided for hereunder, or to
prosecute or defend any suit in respect of this Agreement, the
Notes or any other Loan Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the
Administrative Agent shall be or become, in the Administrative
Agent's determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to
do the acts indemnified against hereunder until such additional
indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the
Administrative Agent shall have been notified by telephone,
confirmed in writing, by any Lender by 5:00 p.m. (New York City
time), on the day prior to a Borrowing of other than Base Rate
Loans that are to be made on the same date requested by the
Borrower that such Lender will not make available the amount
which would constitute its Percentage of such Borrowing in the
case of Revolving Loans, or the amount of its Competitive Bid
Loan Offer that has been accepted by the Borrower pursuant to
clause (e)(ii) of Section 2.4, in the case of Competitive Bid
Loans, in each case on the date specified therefor, the
Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the Borrower a
corresponding amount. In the case of a Borrowing of Base Rate
Loans that are to be made on the same date requested by the
Borrower, the Administrative Agent may assume that each Lender
will make available to the Administrative Agent the amount which
would constitute its Percentage of such Borrowing in the case of
Revolving Loans, or the amount of its Competitive Bid Loan Offer
that has been accepted by the Borrower pursuant to clause (e)(ii)
of Section 2.4, in the case of Competitive Bid Loans, and, in
reliance upon such assumption, make available to the Borrower a
corresponding amount. If and to the extent that such Lender shall
not have made such amount available to the Administrative Agent,
such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand, without duplication,
such corresponding amount together with interest thereon, for
each day from the date the Administrative Agent made such amount
available to the Borrower to the date such amount is repaid to
the Administrative Agent, in the case of the Borrower, at the
interest rate applicable at the time to Loans comprising such
Borrowing, and in the case of such Lender, for the period from
the date such funds were advanced to the Borrower to (and
including) three days thereafter, at the rate customarily charged
for inter-bank loans in the U.S., and following such third day,
at the interest rate applicable at the time to Loans comprising
such Borrowing.
SECTION 9.3. Exculpation. Neither the Administrative
Agent nor any of its directors, officers, employees or agents
shall be liable to any Lender for any action taken or omitted to
be taken by it under this Agreement or any other Loan Document,
or in connection herewith or therewith, except for its own wilful
misconduct or gross negligence, nor responsible for any recitals
or warranties herein or therein, nor for the effectiveness or,
other than with respect to the Administrative Agent,
enforceability, validity or due execution of this Agreement or
any other Loan Document (as it relates to the Administrative
Agent), nor to make any inquiry respecting the performance by the
Borrower of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by the
Administrative Agent shall not obligate it to make any further
inquiry or to take any action. The Administrative Agent shall be
entitled to rely upon advice of counsel concerning legal matters
and upon any notice, consent, certificate, statement or writing
which the Administrative Agent believes to be genuine and to have
been presented by a proper Person.
SECTION 9.4. Successor. The Administrative Agent may
resign as such at any time upon at least 30 days' prior notice to
the Borrower and all Lenders. If the Administrative Agent at any
time shall resign, the Required Lenders may, with the written
consent of the Borrower so long as no Default has occurred and is
continuing (which consent shall not be unreasonably withheld),
appoint another Lender as a successor Administrative Agent, which
shall thereupon (subject to its consent) become the
Administrative Agent hereunder. If no successor Administrative
Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, which shall
(subject to its consent) be one of the Lenders or a commercial
banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking
institution, and having a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to
receive from the retiring Administrative Agent such documents of
transfer and assignment as such successor Administrative Agent
may reasonably request, and shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's
resignation hereunder as the Administrative Agent, the provisions
of
(a) this Article IX shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was
the Administrative Agent under this Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to
inure to its benefit.
SECTION 9.5. Credit Extensions by an Agent. Each Agent
shall have the same rights and powers with respect to (x) the
Loans made by it or any of its respective Affiliates, and (y) the
Notes held by it or any of its respective Affiliates as any other
Lender and may exercise the same as if it were not an Agent.
Each Agent and their respective Affiliates may accept deposits
from, lend money to, and generally engage in any kind of business
with the Borrower or any Subsidiary or Affiliate of the Borrower
as if such Agent, as the case may be, were not an Agent
hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges
that it has, independently of the Administrative Agent, each Co-
Agent and each other Lender, and based on such Lender's review of
the financial information of the Borrower, this Agreement, the
other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents,
information and investigations as such Lender has deemed
appropriate, made its own credit decision to extend its
Commitment. Each Lender also acknowledges that it will,
independently of the Administrative Agent and each other Lender,
and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its
own credit decisions as to exercising or not exercising from time
to time any rights and privileges available to it under this
Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall
give prompt notice to each Lender of each notice or request
required or permitted to be given to the Administrative Agent by
the Borrower pursuant to the terms of this Agreement (unless
concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document
or instrument received for its account and copies of all other
communications received by the Administrative Agent from the
Borrower for distribution to the Lenders by the Administrative
Agent in accordance with the terms of this Agreement.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Loan Document may from time to
time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to by the
Borrower and the Required Lenders; provided, however, that no
such amendment, modification or waiver which would:
(a) modify any requirement hereunder that any
particular action be taken by all the Lenders or by the
Required Lenders shall be effective unless consented to by
each Lender;
(b) modify this Section 10.1, change the definition
of "Required Lenders", increase the Commitment Amount or
the Percentage of any Lender, or extend the Commitment
Termination Date shall be made without the consent of each
Lender and each holder of a Note;
(c) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of
principal of or interest on or fees in respect of any Loan
or any other amounts payable to a Lender hereunder (or
reduce the principal amount of or rate of interest on any
Loan) shall be made without the consent of the holder of
that Note evidencing such Loan;
(d) affect adversely the interests, rights or
obligations of an Agent qua such Agent or the Issuer qua
Issuer shall be made without consent of the Agent or the
Issuer, respectively; or
(e) extend the time for payments of or reduce any
amounts payable in respect of any Reimbursement Obligation,
including any interest thereon, in which the Lenders have
purchased a participating interest, shall be made without
the consent of each Lender (including the Issuer).
No failure or delay on the part of any Agent, any Lender, the
Issuer or the holder of any Note in exercising any power or right
under this Agreement or any other Loan Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any
such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice
to or demand on the Borrower in any case shall entitle it to any
notice or demand in similar or other circumstances. No waiver or
approval by any Agent, the Issuer, any Lender or the holder of
any Note under this Agreement or any other Loan Document shall,
except as may be otherwise stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
SECTION 10.2. Notices. All notices and other
communications provided to any party hereto under this Agreement
or any other Loan Document shall be in writing or by facsimile
and addressed, delivered or transmitted to such party at its
address or facsimile number set forth below its signature hereto
or set forth in the Lender Assignment Agreement or at such other
address or facsimile number as may be designated by such party in
a notice to the other parties. Any notice, if mailed and
properly addressed with postage prepaid or if properly addressed
and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be
deemed given when transmitted upon receipt of electronic
confirmation of transmission.
SECTION 10.3. Payment of Costs and Expenses. The Borrower
agrees to pay on demand all reasonable out-of-pocket expenses of
the Administrative Agent (including the reasonable fees and out-
of-pocket expenses of a single counsel to the Administrative
Agent and of local counsel, if any, who may be retained by
counsel to the Administrative Agent in connection with
(a) the negotiation, preparation, execution and
delivery of this Agreement and of each other Loan Document,
including schedules and exhibits, and any amendments, (the
costs and expenses associated with the formation of the
syndicate of Lenders) waivers, consents, supplements or
other modifications to this Agreement or any other Loan
Document as may from time to time hereafter be required,
whether or not the transactions contemplated hereby are
consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Loan Document; and
(c) the administration and monitoring of this
Agreement and the Loan Documents, and compliance of the
parties hereto with respect to the terms hereof.
The Borrower further agrees to pay, and to save the Agents and
the Lenders harmless from all liability for, any stamp or other
taxes which may be payable in connection with the execution or
delivery of this Agreement, the Borrowings hereunder, or the
issuance of the Notes or any other Loan Documents. The Borrower
also agrees to reimburse each Agent and each Lender upon demand
for all reasonable out-of-pocket expenses (including reasonable
attorneys' fees and legal expenses (including those fees and
legal expenses of internal counsel to such Lender allocated to
this Agreement)) incurred by such Agent or such Lender in
connection with (x) the negotiation of any restructuring or
"work-out", whether or not consummated, of any Obligations and
(y) the enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the
execution and delivery of this Agreement by the Issuer and each
Lender and the extension of the Commitments, the Borrower hereby
indemnifies, exonerates and holds each Agent, the Issuer and each
Lender and each of their respective officers, directors,
employees and agents (collectively, the "Indemnified Parties")
free and harmless from and against any and all actions, causes of
action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of
whether any such Indemnified Party is a party to the action for
which indemnification hereunder is sought), including reasonable
attorneys' fees and disbursements (collectively, the "Indemnified
Liabilities"), incurred by the Indemnified Parties or any of them
as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds
of any Loan;
(b) any transaction supported by or relating to a
Letter of Credit;
(c) the entering into and performance of this
Agreement and any other Loan Document by any of the
Indemnified Parties (including any action brought by or on
behalf of the Borrower as the result of any determination
by the Required Lenders pursuant to Article V not to make a
Credit Extension due to the failure of the Borrower to meet
the conditions for such Credit Extension);
(d) any investigation, litigation or proceeding
involving the Borrower or any of its Subsidiaries or
property now or previously owned or leased by the Borrower
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Borrower or any of its
Subsidiaries or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material; provided; that the
Indemnified Party shall have given the Borrower notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(e) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Borrower or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Borrower or such
Subsidiary; or
(f) any breach of warranty contained in Section 6.12,
without giving effect to the exceptions based upon the
materially adverse effect and any qualification based on
materiality or knowledge;
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of the
relevant Indemnified Party's gross negligence or wilful
misconduct. If and to the extent that the foregoing undertaking
may be unenforceable for any reason, the Borrower hereby agrees
to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under
applicable law.
SECTION 10.5. Survival. The obligations of the Borrower
under Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the
obligations of the Lenders under Section 9.1, shall in each case
survive any termination of this Agreement, the payment in full of
all Obligations, the termination and/or cancellation of the
Letters of Credit and the termination of all Commitments. The
representations and warranties made by the Borrower in this
Agreement and in each other Loan Document shall survive the
execution and delivery of this Agreement and each such other Loan
Document.
SECTION 10.6. Severability. Any provision of this
Agreement or any other Loan Document which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Loan Document or
affecting the validity or enforceability of such provision in any
other jurisdiction.
SECTION 10.7. Headings. The various headings of this
Agreement and of each other Loan Document are inserted for
convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness,
etc. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be executed by the
Borrower and the Administrative Agent and be deemed to be an
original and all of which shall constitute together but one and
the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower, each
Agent, the Issuer and each Lender (or notice thereof satisfactory
to the Administrative Agent) shall have been received by the
Administrative Agent and notice thereof shall have been given by
the Administrative Agent to the Borrower and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS
AGREEMENT, THE NOTES AND EACH OTHER LOAN DOCUMENT SHALL EACH BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. This Agreement, the Notes and the
other Loan Documents constitute the entire understanding among
the parties hereto with respect to the subject matter hereof and
supersede any prior agreements, written or oral, with respect
thereto.
SECTION 10.10. Successors and Assigns. This Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns;
provided, however, that:
(a) the Borrower may not assign or transfer its
rights or obligations hereunder without the prior written
consent of all Lenders; and
(b) the rights of sale, assignment and transfer of
the Lenders are subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans and Note;
Participations in Loans and Note. Each Lender may assign, or
sell participations in, its Loans and Commitment to one or more
other Persons in accordance with this Section 10.11.
SECTION 10.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower and
Scotiabank (so long as Scotiabank is a Lender) (which
consents shall not be unreasonably delayed or withheld and
which consent, in the case of the Borrower, shall be deemed
to have been given in the absence of a written notice
delivered by the Borrower to the Administrative Agent, on
or before the fifth Business Day after receipt by the
Borrower of such Lender's request for consent, stating, in
reasonable detail, the reasons why the Borrower proposes to
withhold such consent (provided, that the failure to
deliver such consent shall not be a "Default" for purposes
of satisfying the conditions to Credit Extensions set forth
in clause (d) of Section 5.2.1)) may at any time assign and
delegate to one or more commercial banks or other financial
institutions;
(b) with notice to the Borrower and the
Administrative Agent, but without the consent of any
Person, may (i) assign and delegate to any other Lender,
and (ii) assign and/or delegate to any of its Affiliates or
Subsidiaries; and
(c) with notice to the Administrative Agent, but
without the consent of any Person, may pledge its Loans
(and related rights thereto) to a Federal Reserve Bank in
support of borrowings made by such Lender from such Federal
Reserve Bank;
(each Person described in the foregoing clauses as being the
Person to whom such assignment and delegation is to be made,
being hereinafter referred to as an "Assignee Lender"), all or
any fraction of such Lender's total Loans and Commitment (which
assignment and delegation shall be of a constant, and not a
varying, percentage of all the assigning Lender's Loans and
Commitment) in a minimum aggregate amount, when taken together
with other assignments being made to such Assignee Lender under
the Dollar Supply Agreement and Short-Term Dollar Supply
Agreement (as referred to in the definition of the Consignment
Facilities) and under the Short Term Credit Agreement, of
$10,000,000 in the case of an assignment described in clause (a)
(such amount to be reduced pro rata by any permanent reductions
in the amount of the Commitment), or if less, all of such
Lender's Loans and Commitment; provided, however, that any such
Lender will (i) except in connection with a pledge of Loans
pursuant to clause (c) above, contemporaneously sell a pro rata
portion of its (A) Advances and Advance Commitment (as such terms
are defined in the Short-Term Dollar Supply Agreement and Dollar
Supply Agreement referred to in the definition of Consignment
Facilities) and (B) its Loans and Commitment (as such terms are
defined in the Short Term Credit Agreement), in each case to the
same Assignee Lender pursuant to the terms of such agreements and
provided further that any such Assignee Lender will comply, if
applicable, with the provisions contained in the last sentence of
Section 4.6 and further, provided, however, that, the Borrower
and the Administrative Agent shall be entitled to continue to
deal solely and directly with such Lender in connection with the
interests so assigned and delegated to an Assignee Lender until
(d) written notice of such assignment and delegation,
together with payment instructions, addresses and related
information with respect to such Assignee Lender, shall
have been given to the Borrower and the Administrative
Agent by such Lender and such Assignee Lender;
(e) such Assignee Lender shall have executed and
delivered to the Borrower and the Administrative Agent a
Lender Assignment Agreement, accepted by the Administrative
Agent; and
(f) the processing fees described below shall have
been paid.
From and after the date that the Administrative Agent accepts
such Lender Assignment Agreement, (x) the Assignee Lender
thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder
have been assigned and delegated to such Assignee Lender in
connection with such Lender Assignment Agreement, shall have the
rights and obligations of a Lender hereunder and under the other
Loan Documents, and (y) the assignor Lender, to the extent that
rights and obligations hereunder have been assigned and delegated
by it in connection with such Lender Assignment Agreement, shall
be released from its obligations hereunder and under the other
Loan Documents. Within five Business Days after its receipt of
notice that the Administrative Agent has received an executed
Lender Assignment Agreement, the Borrower shall execute and
deliver to the Administrative Agent (for delivery to the relevant
Assignee Lender) a new Note evidencing such Assignee Lender's
assigned Loans and Commitment and, if the assignor Lender has
retained Loans and a Commitment hereunder, a replacement Note in
the principal amount of the Loans and Commitment retained by the
assignor Lender hereunder (such Note to be in exchange for, but
not in payment of, that Note then held by such assignor Lender).
Each such Note shall be dated the date of the predecessor Note.
The assignor Lender shall mark the predecessor Note "exchanged"
and deliver it to the Borrower. Accrued interest on that part of
the predecessor Note evidenced by the new Note, and accrued fees,
shall be paid as provided in the Lender Assignment Agreement.
Accrued interest on that part of the predecessor Note evidenced
by the replacement Note shall be paid to the assignor Lender.
Accrued interest and accrued fees shall be paid at the same time
or times provided in the predecessor Note and in this Agreement.
Such assignor Lender or such Assignee Lender must also pay
(without duplication of any processing fees payable pursuant to
Section 10.11.1 of the Short Term Credit Agreement, Section
8.11.1 of the Dollar Supply Agreement and Section 8.11.1 of the
Short-Term Dollar Supply Agreement (as referred to in the
definition of Consignment Facilities)) a processing fee to the
Administrative Agent upon delivery of any Lender Assignment
Agreement in the amount of $2,500 (provided, however, that such
processing fee shall not be required to be paid by a Lender in
the case of (i) an assignment and/or delegation of such Lender's
Loans and Commitments to an Affiliate or Subsidiary of such
Lender, or (ii) to a Federal Reserve Bank pursuant to clause (c)
of this Section. Any attempted assignment and delegation not
made in accordance with this Section 10.11.1 shall be null and
void.
SECTION 10.11.2. Participations. Any Lender may at any
time sell to one or more commercial banks or other Persons (each
of such commercial banks and other Persons being herein called a
"Participant") participating interests in any of the Loans, its
Commitment, or other interests of such Lender hereunder;
provided, however, that
(a) no participation contemplated in this
Section 10.11.2 shall relieve such Lender from its
Commitment or its other obligations hereunder or under any
other Loan Document;
(b) such Lender shall remain solely responsible for
the performance of its Commitment and such other
obligations;
(c) the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under
this Agreement and each of the other Loan Documents;
(d) no Participant, unless such Participant is an
Affiliate of such Lender, or is itself a Lender, shall be
entitled to require such Lender to take or refrain from
taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any
Participant that such Lender will not, without such
Participant's consent, take any actions of the type
described in clause (b) or (c) of Section 10.1; and
(e) the Borrower shall not be required to pay any
amount hereunder that is greater than the amount which it
would have been required to pay had no participating
interest been sold.
The Borrower acknowledges and agrees that each Participant, for
purposes of Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 10.3 and 10.4,
shall be considered a Lender.
SECTION 10.12. Other Transactions. Nothing contained
herein shall preclude any Agent or any other Lender from engaging
in any transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of
its Affiliates in which the Borrower or such Affiliate is not
restricted hereby from engaging with any other Person.
SECTION 10.13. Forum Selection and Consent to
Jurisdiction. ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF EACH AGENT, THE ISSUER,
THE LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE CITY AND STATE OF NEW YORK OR IN
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE
BORROWER HEREBY EXPRESSLY AND IRREVOCABLY, FOR ITSELF AND ITS
PROPERTY, SUBMITS TO THE EXTENT PERMITTED BY APPLICABLE LAW TO
THE JURISDICTION OF THE COURTS OF THE CITY AND STATE OF NEW YORK
AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH SUCH LITIGATION. THE BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF NEW YORK. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING
OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE
BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
SECTION 10.14. Waiver of Jury Trial. EACH AGENT, THE
ISSUER, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH
AGENT, THE ISSUER, THE LENDERS OR THE BORROWER. THE BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR EACH AGENT, THE ISSUER AND
THE LENDERS ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN
DOCUMENT.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Name: Stephen B. Mudd
Title: Vice President and Treasurer
Address: 250 Park Avenue
New York, New York 10177
Facsimile No.: 212-309-0682
Attention: Mr. Stephen B. Mudd
Vice President and Treasurer
THE BANK OF NOVA SCOTIA,
in its capacity as
Administrative Agent, Co-Agent and
the Issuer
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NOVA SCOTIA, in its capacity
as a Lender
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Domestic
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
LIBOR
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NEW YORK, in its capacity as
a Co-Agent and a Lender
By: /s/ William A. Kerr
Name: William A. Kerr
Title: Vice President
Domestic
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
LIBOR
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
PERCENTAGE
8.641975300% CHEMICAL BANK, in its capacity as
a Co-Agent and a Lender
By: /s/ Theodore L. Parker
Name: Theodore L. Parker
Title: Vice President
Domestic
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
LIBOR
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
PERCENTAGE
7.514761100% FLEET BANK, N.A.
By: /s/ John V. Raleigh
Name: John V. Raleigh
Title: Vice President
Domestic
Office: One Stamford Plaza
263 Tresser Blvd.
Stamford, Connecticut 06901
Facsimile No.: 203-351-1511
Attention: Virginia Rockwood
LIBOR
Office: One Stamford Plaza
263 Tresser Blvd.
Stamford, Connecticut 06901
Facsimile No.: 203-351-1511
Attention: Virginia Rockwood
PERCENTAGE
7.514761100% NBD BANK, N.A.
By: /s/ Anna R. Hoffman
Name: Anna R. Hoffman
Title: Vice President
Domestic
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
LIBOR
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
PERCENTAGE
6.441223800% THE BANK OF TOKYO TRUST COMPANY
By: /s/ Jeffrey Miller
Name: Jeffrey Miller
Title:
Domestic
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
LIBOR
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
PERCENTAGE
6.441223800% LTCB TRUST COMPANY
By: /s/ Rene LeBlanc
Name: Rene LeBlanc
Title: Senior Vice President
Domestic
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
LIBOR
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
PERCENTAGE
6.441223800% SHAWMUT BANK, N.A.
By: /s/ Kerry Day
Name: Kerry Day
Title: Assistant Vice President
Domestic
Office: One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
LIBOR
Office: Shawmut Bank, N.A.
One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
PERCENTAGE
4.294149200% CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Vice President
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Authorized Signature
In both cases:
Domestic
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
LIBOR
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
For Credit Matters:
Attention: Andrea Griffis
PERCENTAGE
4.294149200% THE DAIWA BANK, LIMITED
By: /s/ J.H. Broadley
Name: J.H. Broadley
Title: Vice President
By: /s/ B.W. Henry
Name: B.W. Henry
Title: Vice President and Manager
Domestic
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
LIBOR
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
Address for
Notices: The Daiwa Bank, Limited
450 Lexinton Avenue
Suite 1700
New York, New York 10017
Facsimile No.: 212-818-0866
Attention: Catherine Tiano, Credit
Administration Assistant
PERCENTAGE
4.294149200% DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ Jeffrey N. Wieser
Name: Jeffrey N. Wieser
Title: Director
By: /s/ Jean M. Hannigan
Name: Jean M. Hannigan
Title: Assistant Vice President
Domestic
Office: Deutsche Bank AG,
New York and/or
Cayman Islands Branches
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
LIBOR
Office: Deutsche Bank AG,
Cayman Islands Branch
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
PERCENTAGE
4.294149200% THE FUJI BANK LTD.
By: /s/ Gina M. Kearns
Name: Gina M. Kearns
Title: Vice President and Manager
Domestic
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
LIBOR
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
PERCENTAGE
4.294149200% NATIONAL WESTMINSTER BANK USA
By: /s/ Phillip H. Sorace
Name: Phillip H. Sorace
Title: Vice President
Domestic
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
LIBOR
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
PERCENTAGE
3.220611900% ABN AMRO BANK N.V. NEW YORK BRANCH
By: /s/ Richard H. West
Name: Richard H. West
Title: Group Vice President
By: /s/ Rodolfo Barros
Name: Rodolfo Barros
Title: Vice President
Domestic
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
LIBOR
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
PERCENTAGE
3.220611900% BANQUE PARIBAS
By: /s/ Richard G. Burrows
Name: Richard G. Burrows
Title: Vice President
By: /s/ Ann Pifer
Name: Ann Pifer
Title: Assistant Vice President
Domestic
Office: 787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
LIBOR
Office: Banque Paribas
787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
PERCENTAGE
3.220611900% GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By: /s/ D. Stephens / /s/ John Redding
Name: Dhuane G. Stephens/John P. Redding
Title: Vice President / Vice President
Domestic
Office: 65 East 55th Street
New York, New York 10022
Facsimile No: 212-644-0644
Attention: Dhuane Stephens
LIBOR
Office: 65 East 55th Street
New York, New York 10022
Facsimile No.: 212-421-2719
Attention: Orlando Diaz
PERCENTAGE
2.147074700% COMERICA BANK
By: /s/ Julie Burke Smith
Name: Julie Burke Smith
Title: Vice President
Domestic
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
LIBOR
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
PERCENTAGE
2.147074700% IBJ SCHRODER BANK & TRUST COMPANY
By: /s/ J. Christopher Mangan
Name: J. Christopher Mangan
Title: Vice President
Domestic
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
LIBOR
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
PERCENTAGE
2.147074700% THE MITSUBISHI BANK, LIMITED -
NEW YORK BRANCH
By: /s/ Paula Mueller
Name: Paula Mueller
Title: Vice President
Domestic
Office: 225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
LIBOR
Office: The Mitsubishi Bank, Limited
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
PERCENTAGE
2.147074700% YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By: /s/ Nicholas Pullen
Name: Nicholas Pullen
Title: Vice President
Domestic
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
LIBOR
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
SCHEDULE I
DISCLOSURE SCHEDULE
ITEM 1. Existing Letters of Credit.
Stated Amount Beneficiary
ITEM 5.1.3 Indebtedness to be Paid or Replaced.
Creditor Outstanding Principal Amount
ITEM 6.7 Litigation.
Description of Proceeding Action or Claim Sought
ITEM 6.8 Existing Subsidiaries.
State of Ownership Business
Name Incorporation % Description
ITEM 6.11 Employee Benefit Plans.
ITEM 6.12 Environmental Matters.
ITEM 7.2.3(b) Ongoing Indebtedness.
Creditor Outstanding Principal Amount
ITEM 7.2.5.(a) Ongoing Investments.
EXHIBIT 10.4
EXECUTION COPY
U.S. $53,750,000
SHORT TERM REVOLVING CREDIT AGREEMENT,
dated as of September 28, 1994
among
HANDY & HARMAN,
as the Borrower,
CERTAIN FINANCIAL INSTITUTIONS,
as the Lenders,
THE BANK OF NOVA SCOTIA,
CHEMICAL BANK
and
THE BANK OF NEW YORK,
as the Co-Agents,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . .
1.4. Accounting and Financial Determinations; No
Duplication; Consolidation . . . . . . . . . .
ARTICLE II
COMMITMENTS, BORROWING AND BIDDING
PROCEDURES AND NOTES
2.1. Commitments . . . . . . . . . . . . . . . . . . .
2.1.1. Revolving Loan Commitment . . . . . . . . . . . .
2.1.2. Swing Line Loan Commitment . . . . . . . . . . .
2.1.3. Lenders Not Permitted or Required to Make
Revolving Loans or Swing Line Loans . . . . . .
2.2. Reduction of Commitments . . . . . . . . . . . .
2.3. Revolving Loan and Swing Line Loan Borrowing
Procedure and Funding Maintenance . . . . . . .
2.3.1. Continuation and Conversion Elections . . . . . .
2.3.2. Funding . . . . . . . . . . . . . . . . . . . . .
2.4. Competitive Bid Loans . . . . . . . . . . . . . .
2.5. Notes . . . . . . . . . . . . . . . . . . . . . .
2.6. Extension of Stated Maturity Date and Maturity of
Loans . . . . . . . . . . . . . . . . . . . . .
2.6.1. Request for Extension of Stated Maturity Date and
Maturity of Loans . . . . . . . . . . . . . . .
2.6.2. Consent to Extension of Stated Maturity Date and
Maturity of Loans . . . . . . . . . . . . . . .
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments . . . . . . . . . . .
3.1.1. Final Maturity . . . . . . . . . . . . . . . . .
3.1.2. Voluntary Prepayments . . . . . . . . . . . . . .
3.1.3. Mandatory Prepayments . . . . . . . . . . . . . .
3.1.4. Acceleration of Stated Maturity Date . . . . . .
3.2. Interest Provisions . . . . . . . . . . . . . . .
3.2.1. Rates . . . . . . . . . . . . . . . . . . . . . .
3.2.2. Post-Maturity Rates . . . . . . . . . . . . . . .
3.2.3. Payment Dates . . . . . . . . . . . . . . . . . .
3.3. Fees . . . . . . . . . . . . . . . . . . . . . .
3.3.1. Commitment Fee . . . . . . . . . . . . . . . . .
3.3.2. Agents' Fee . . . . . . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . .
4.2. Deposits Unavailable . . . . . . . . . . . . . .
4.3. Increased LIBO Rate Loan Costs, etc. . . . . . .
4.4. Funding Losses . . . . . . . . . . . . . . . . .
4.5. Increased Capital Costs . . . . . . . . . . . . .
4.6. Taxes . . . . . . . . . . . . . . . . . . . . . .
4.7. Payments, Computations, etc. . . . . . . . . . .
4.8. Sharing of Payments . . . . . . . . . . . . . . .
4.9. Setoff . . . . . . . . . . . . . . . . . . . . .
4.10. Use of Proceeds . . . . . . . . . . . . . . . . .
4.11. Replacement of Lenders . . . . . . . . . . . . .
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . . .
5.1.2. Delivery of Notes . . . . . . . . . . . . . . . .
5.1.3. Payment of Outstanding Indebtedness, etc. . . . .
5.1.4. Opinions of Counsel . . . . . . . . . . . . . . .
5.1.5. Closing Fees, Expenses, etc. . . . . . . . . . .
5.1.6. Termination of Existing Agreement . . . . . . . .
5.2. All Credit Extensions . . . . . . . . . . . . . .
5.2.1. Compliance with Warranties, No Default, etc. . .
5.2.2. Borrowing Request . . . . . . . . . . . . . . . .
5.2.3. Satisfactory Legal Form . . . . . . . . . . . . .
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc. . . . . . . . . . . . . . . .
6.2. Due Authorization, Non-Contravention, etc. . . .
6.3. Government Approval, Regulation, etc. . . . . . .
6.4. Validity, etc. . . . . . . . . . . . . . . . . .
6.5. Financial Information . . . . . . . . . . . . . .
6.6. No Material Adverse Change . . . . . . . . . . .
6.7. Litigation, etc. . . . . . . . . . . . . . . . .
6.8. Subsidiaries . . . . . . . . . . . . . . . . . .
6.9. Ownership of Properties . . . . . . . . . . . . .
6.10. Taxes . . . . . . . . . . . . . . . . . . . . . .
6.11. Pension and Welfare Plans . . . . . . . . . . . .
6.12. Environmental Warranties . . . . . . . . . . . .
6.13. Regulations G, U and X . . . . . . . . . . . . .
6.14. Accuracy of Information . . . . . . . . . . . . .
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants . . . . . . . . . . . . . .
7.1.1. Financial Information, Reports, Notices, etc. . .
7.1.2. Compliance with Laws, etc. . . . . . . . . . . .
7.1.3. Maintenance of Properties . . . . . . . . . . . .
7.1.4. Insurance . . . . . . . . . . . . . . . . . . . .
7.1.5. Books and Records . . . . . . . . . . . . . . . .
7.1.6. Environmental Covenant . . . . . . . . . . . . .
7.2. Negative Covenants . . . . . . . . . . . . . . .
7.2.1. Business Activities . . . . . . . . . . . . . . .
7.2.2. Designated Debt, Letters of Credit; Subsidiary
Debt . . . . . . . . . . . . . . . . . . . . .
7.2.3. Liens . . . . . . . . . . . . . . . . . . . . . .
7.2.4. Financial Condition . . . . . . . . . . . . . . .
7.2.5. Investments . . . . . . . . . . . . . . . . . . .
7.2.6. Restricted Payments, etc. . . . . . . . . . . . .
7.2.7. Transactions with Affiliates . . . . . . . . . .
7.2.8. Long Term Rental Obligations . . . . . . . . . .
7.2.9. Take or Pay Contracts . . . . . . . . . . . . . .
7.2.10. Consolidation, Merger, etc. . . . . . . . . . . .
7.2.11. Asset Dispositions, etc. . . . . . . . . . . . .
7.2.12. Restrictive Agreements, etc. . . . . . . . . . .
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . .
8.1.1. Non-Payment of Obligations . . . . . . . . . . .
8.1.2. Breach of Warranty . . . . . . . . . . . . . . .
8.1.3. Non-Performance of Certain Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.4. Non-Performance of Other Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.5. Default on Other Indebtedness or Agreements . . .
8.1.6. Judgments . . . . . . . . . . . . . . . . . . . .
8.1.7. Pension Plans . . . . . . . . . . . . . . . . . .
8.1.8. Control of the Borrower . . . . . . . . . . . . .
8.1.9. Bankruptcy, Insolvency, etc. . . . . . . . . . .
8.2. Action if Bankruptcy . . . . . . . . . . . . . .
8.3. Action if Other Event of Default . . . . . . . .
ARTICLE IX
THE AGENTS
9.1. Actions . . . . . . . . . . . . . . . . . . . . .
9.2. Funding Reliance, etc. . . . . . . . . . . . . .
9.3. Exculpation . . . . . . . . . . . . . . . . . . .
9.4. Successor . . . . . . . . . . . . . . . . . . . .
9.5. Credit Extensions by an Agent. . . . . . . . . .
9.6. Credit Decisions . . . . . . . . . . . . . . . .
9.7. Copies, etc. . . . . . . . . . . . . . . . . . .
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc. . . . . . . . . . . . .
10.2. Notices . . . . . . . . . . . . . . . . . . . . .
10.3. Payment of Costs and Expenses . . . . . . . . . .
10.4. Indemnification . . . . . . . . . . . . . . . . .
10.5. Survival . . . . . . . . . . . . . . . . . . . .
10.6. Severability . . . . . . . . . . . . . . . . . .
10.7. Headings . . . . . . . . . . . . . . . . . . . .
10.8. Execution in Counterparts, Effectiveness, etc. .
10.9. Governing Law; Entire Agreement . . . . . . . . .
10.10. Successors and Assigns . . . . . . . . . . . . .
10.11. Sale and Transfer of Loans and Note;
Participations in Loans and Note . . . . . . .
10.11.1. Assignments . . . . . . . . . . . . . . . . . . .
10.11.2. Participations . . . . . . . . . . . . . . . . .
10.12. Other Transactions . . . . . . . . . . . . . . .
10.13. Forum Selection and Consent to Jurisdiction . . .
10.14. Waiver of Jury Trial . . . . . . . . . . . . . .
SCHEDULE I Disclosure Schedule
EXHIBIT A-1 Form of Revolving Loan Note
EXHIBIT A-2 Form of Competitive Bid Loan Note
EXHIBIT A-3 Form of Swing Line Loan Note
EXHIBIT B-1 Form of Revolving Loan Borrowing Request
EXHIBIT B-2 Form of Competitive Bid Loan Borrowing Request
EXHIBIT C-1 Form of Invitation for Bid Loan Quotes
EXHIBIT C-2 Form of Competitive Bid Loan Offer
EXHIBIT C-3 Form of Competitive Bid Loan Acceptance
EXHIBIT D Form of Lender Assignment Agreement
EXHIBIT E Form of Compliance Certificate
EXHIBIT F Form of Continuation/Conversion Notice
EXHIBIT G Form of Extension Request
EXHIBIT H Form of Opinion of Counsel to the Borrower
EXHIBIT I Form of Opinion of Counsel to the Administrative
Agent
SHORT TERM REVOLVING CREDIT AGREEMENT
THIS SHORT TERM REVOLVING CREDIT AGREEMENT, dated as of
September 28, 1994, among HANDY & HARMAN, a New York corporation
(the "Borrower"), the various financial institutions as are or
may become parties hereto (collectively, the "Lenders"), THE BANK
OF NOVA SCOTIA ("Scotiabank"), CHEMICAL BANK ("Chemical") and THE
BANK OF NEW YORK ("BONY"), as co-agents (in such capacity,
individually referred to as a "Co-Agent" and collectively
referred to as the "Co-Agents"), and Scotiabank, as
administrative agent (in such capacity, together with any
successor appointed pursuant to Section 9.4, the "Administrative
Agent") for the Lenders,
W I T N E S S E T H:
WHEREAS, the Borrower is engaged directly and through its
various Subsidiaries in the businesses described in the
Borrower's Annual Report on Form 10-K for the 1993 Fiscal Year;
WHEREAS, the Borrower desires to obtain Commitments from the
Lenders pursuant to which Revolving Loans and Swing Line Loans,
in a maximum aggregate principal and stated amount at any one
time outstanding not to exceed $53,750,000, will be made to the
Borrower from time to time prior to the Loan Commitment
Termination Date;
WHEREAS, the Borrower also desires the Lenders to provide a
procedure pursuant to which the Borrower may invite the Lenders
to bid for (on an uncommitted basis) and to make short-term loans
(in the form of Competitive Bid Loans) to the Borrower;
WHEREAS, the Lenders are willing, on the terms and subject
to the conditions hereinafter set forth (including Article V), to
(a) extend such Commitments;
(b) make Revolving Loans to the Borrower; and
(c) provide such a procedure to make Competitive Bid
Loans;
WHEREAS, the Swing Line Lender is willing, on the terms and
subject to the conditions hereinafter set forth (including
Article V), to
(a) extend the Swing Line Loan Commitment; and
(b) make Swing Line Loans to the Borrower; and
WHEREAS, the proceeds of such Credit Extensions will be used
to refinance in full all amounts under the Existing Agreement and
for the general corporate purposes of the Borrower and its
Subsidiaries;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"Absolute Rate" means, with respect to an Absolute Rate Loan
made by a given Lender, a fixed rate of interest per annum
(rounded to the nearest 1/100th of 1%) offered by such Lender and
accepted by the Borrower.
"Absolute Rate Auction" means a solicitation of Competitive
Bid Loan quotes at an Absolute Rate pursuant to Section 2.4.
"Absolute Rate Loan" means a Competitive Bid Loan which
bears interest at an Absolute Rate.
"Adjusted Consolidated Tangible Net Worth" means the sum of
(a) Consolidated Tangible Net Worth
plus
(b) 40% of the excess of the Market Value of the
Borrower's and its Subsidiaries' owned precious metal
holdings over the LIFO cost of such holdings as set forth in
the Borrower's consolidated financial statements delivered
to the Lenders pursuant to clause (a) or (b) of Section
7.1.1.
"Administrative Agent" is defined in the preamble.
"Affected LIBO Lender" is defined in Section 4.3.
"Affiliate" means, with respect to any Person, any other
Person which, directly or indirectly, controls, is controlled by
or is under common control with such Person (excluding any
trustee under, or any committee with responsibility for
administering, any Plan); provided, that none of Mario Gabelli,
Gabelli Funds, Inc., Gamco Investors, Inc., Gabelli & Company,
Inc. or Gabelli Performance Partnership shall be considered an
"Affiliate" of the Borrower. "Control" and its derivatives means
the power, directly or indirectly,
(a) to vote 10% or more of the securities or other
ownership or beneficial interests (on a fully diluted basis)
having ordinary voting power for the election of directors
or managing general partners of any Person; or
(b) to direct or cause the direction of the management
and policies of such Person whether by contract or
otherwise.
"Agent" means, as the context may require, either
Scotiabank, BONY or Chemical, acting in their capacity as
Co-Agent, or Administrative Agent.
"Agreement" means, on any date, this Short Term Revolving
Credit Agreement as originally in effect on the Effective Date
and as thereafter from time to time amended, restated,
supplemented, amended and restated, or otherwise modified and in
effect on such date.
"Alternate Base Rate" means, on any date and with respect to
all Base Rate Loans, a fluctuating rate of interest per annum
equal to the higher of
(a) the rate of interest most recently established by
Scotiabank at its Domestic Office as its base rate for
Dollar loans in the United States; and
(b) the Federal Funds Rate for such date plus 1/2 of
1%.
The Alternate Base Rate is not necessarily intended to be the
lowest rate of interest determined by Scotiabank in connection
with extensions of credit. Changes in the rate of interest on
any Loans or other Obligations accruing interest at the Alternate
Base Rate will take effect simultaneously with each change in the
Alternate Base Rate. The Administrative Agent will give prompt
notice to the Borrower and the Lenders of changes in the
Alternate Base Rate.
"Assignee Lender" is defined in Section 10.11.1.
"Authorized Officer" means those officers of the Borrower
whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders pursuant to Section 5.1.1.
"Base Rate Loan" means a Revolving Loan or Swing Line Loan
bearing interest at a fluctuating rate determined by reference to
the Alternate Base Rate.
"BONY" is defined in the preamble.
"Borrower" is defined in the preamble.
"Borrowing" means, as the context may require, either a
Competitive Bid Loan Borrowing, a Swing Line Loan Borrowing or a
Revolving Loan Borrowing.
"Borrowing Request" means, as the context may require,
either a Revolving Loan Borrowing Request or a Competitive Bid
Loan Borrowing Request.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to
be closed in New York, New York; and
(b) relative to the making, continuing, prepaying or
repaying of any LIBO Rate Loans or Competitive Bid Loans
made as a result of a LIBOR Auction, any day on which
dealings in Dollars are carried on in the London interbank
market.
"Capital Expenditures" means, for any period, the aggregate
amount of all expenditures of the Borrower and its Subsidiaries
for fixed or capital assets made during such period which, in
accordance with GAAP, would be classified as capital
expenditures, including the aggregate amount of all Capitalized
Lease Liabilities incurred during such period.
"Capitalized Lease Liabilities" means all monetary
obligations of the Borrower or any of its Subsidiaries under any
leasing or similar arrangement which, in accordance with GAAP,
would be classified as capitalized leases, and, for purposes of
this Agreement and each other Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined
in accordance with GAAP.
"Cash Equivalent Investment" means, at any time:
(a) any obligation issued or guaranteed by the United
States Government or any agency thereof, maturing not more
than one year after such time;
(b) commercial paper, maturing not more than nine
months from the date of issue, which is issued by
(i) a corporation (other than the Borrower or an
Affiliate of the Borrower) organized under the laws of
any state of the United States or of the District of
Columbia and rated A-1 by Standard & Poor's Corporation
or P-1 by Moody's Investors Service, Inc., or
(ii) any Lender (or its holding company);
(c) any certificate of deposit or bankers acceptance,
maturing not more than one year after such time, which is
issued by either
(i) a commercial banking institution that is a
member of the Federal Reserve System and has total
assets of not less than $5,000,000,000 and commercial
paper rated A-1 by Standard & Poor's Corporation or P-1
by Moody's Investors Service, Inc., or
(ii) any Lender; or
(d) any repurchase agreement entered into with any
Lender (or other commercial banking institution of the
stature referred to in clause (c)(i)) which
(i) is secured by a fully perfected security
interest (which may be hold in custody, tri-party
custodian or deliver out) in any obligation of the type
described in any of clauses (a) through (c), and
(ii) has a market value at the time such
repurchase agreement is entered into of not less than
100% of the repurchase obligation of such Lender (or
other commercial banking institution) thereunder.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response
Compensation Liability Information System List.
"Change in Control" means the acquisition by any Person, or
two or more Persons acting in concert, of beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934) of 20% or
more of the outstanding shares of voting stock of the Borrower.
"Chemical" is defined in the preamble.
"Co-Agent" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Code" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.
"Commitment" means, as the context may require, the
Revolving Loan Commitment or the Swing Line Loan Commitment.
"Commitment Termination Event" means
(a) the occurrence of any Default described in clauses
(a) through (d) of Section 8.1.9; or
(b) the occurrence and continuance of any other Event
of Default and either
(i) the declaration of the Loans to be due and
payable pursuant to Section 8.3, or
(ii) in the absence of such declaration, the
giving of notice by the Administrative Agent, acting at
the direction of the Required Lenders, to the Borrower
that the Commitments have been terminated.
"Competitive Bid Loan" means a loan made by a Lender to the
Borrower based on the LIBO Rate or the Absolute Rate as part of a
Competitive Bid Loan Borrowing resulting from the procedure
described in Section 2.4.
"Competitive Bid Loan Acceptance" means an acceptance by the
Borrower of a Competitive Bid Loan Offer pursuant to clause (e)
of Section 2.4, substantially in the form of Exhibit C-3 attached
hereto.
"Competitive Bid Loan Borrowing" means Competitive Bid Loans
made pursuant to the same Competitive Bid Loan Request by the
Lender or each of the Lenders whose offer to make such
Competitive Bid Loans as part of such requested Borrowing has
been accepted by the Borrower pursuant to clause (e) of Section
2.4.
"Competitive Bid Loan Borrowing Request" means a certificate
requesting that the Lenders extend offers to make Competitive Bid
Loans, duly executed by an Authorized Officer substantially in
the form of Exhibit B-2 attached hereto.
"Competitive Bid Loan Maturity Date" is defined in
clause (a)(iii) of Section 2.4.
"Competitive Bid Loan Note" means any promissory note of the
Borrower, in the form of Exhibit A-2 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to
such Lender resulting from Competitive Bid Loans outstanding from
such Lender, and also means all other promissory notes accepted
from time to time in substitution therefor or renewal thereof.
"Competitive Bid Loan Offer" means an offer by a Lender to
make a Competitive Bid Loan pursuant to clause (c) of
Section 2.4, substantially in the form of Exhibit C-2 attached
hereto.
"Competitive Bid Outstanding Balance" means, at any time,
the then aggregate outstanding principal amount of all
Competitive Bid Loans.
"Competitive Bid Rate" means, as the context may require,
either the Absolute Rate or the LIBO Rate (plus the LIBO Rate Bid
Margin) offered by a Lender in a Competitive Bid Loan Offer in
respect of a Competitive Bid Loan proposed pursuant to Section
2.4.
"Compliance Certificate" means a certificate duly executed
and delivered by an Authorized Officer pursuant to Section 7.1.1,
in substantially the form of Exhibit E hereto.
"Consignment Facilities" means, collectively, (i) the Fee
Consignment Agreement dated as of the date hereof between the
Borrower (as consignee) and Scotiabank (as consignor), (ii) the
Short-Term Fee Consignment Agreement dated as of the date hereof
between the Borrower (as consignee) and Scotiabank (as
consignor), (iii) the Dollar Supply Agreement dated as of the
date hereof among the Borrower (as consignee), Scotiabank (as
consignor), the financial institutions parties thereto,
Scotiabank, BONY and Chemical Bank as the co-agents, and
Scotiabank as the administrative agent and (iv) the Short-Term
Dollar Supply Agreement dated as of the date hereof among the
Borrower (as consignee), Scotiabank (as consignor), the financial
institutions parties thereto, Scotiabank, BONY and Chemical Bank
as the co-agents, and Scotiabank as the administrative agent, in
each case as such agreements may be amended, supplemented,
amended and restated or otherwise modified pursuant to the terms
thereof.
"Consolidated Tangible Net Worth" means the excess of
(a) the sum of
(i) the par value (or value stated on the books
of the Borrower) of the capital stock of all classes of
the Borrower, plus (or minus in the case of a surplus
deficit),
(ii) the amount of the consolidated surplus,
whether capital or earned, of the Borrower and its
Subsidiaries
over
(b) the sum of
(i) treasury stock, subscribed but unissued
stock, unamortized debt discount and expense, good
will, trademarks, trade names, patents and other
intangible assets (but not deferred charges) of the
Borrower, and
(ii) all write-ups in the book value of any
assets owned by the Borrower or its Subsidiaries
subsequent to March 16, 1992, other than write-ups of
assets (and assets of Subsidiaries) acquired by the
Borrower and/or its Subsidiaries (exclusive of
goodwill) that are made in connection with the
acquisition thereof.
"Contingent Liability" means any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise
becomes or is contingently liable upon or with respect to (by
direct or indirect agreement, contingent or otherwise, to provide
funds for payment (including an agreement to cause a letter of
credit to be issued for the benefit of another Person), to supply
funds to, or otherwise to invest in, a debtor, or otherwise to
assure a creditor against loss, including an agreement to
purchase, sell or lease (as lessee or lessor) property, products,
materials or supplies or services for the purpose of enabling a
debtor to make payment of its obligations) the Indebtedness,
obligation or any other liability, net worth, working capital or
earnings of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of
any other Person. The amount of any Person's obligation under
any Contingent Liability shall (subject to any limitation set
forth therein) be deemed to be the outstanding principal amount
(or maximum principal amount, if larger) of the debt, obligation
or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of
continuation or conversion and certificate duly executed by an
Authorized Officer, substantially in the form of Exhibit F
attached hereto.
"Controlled Group" means all members of a controlled group
of corporations and all members of a controlled group of trades
or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single
employer under Section 414(b) or 414(c) of the Code or Section
4001 of ERISA.
"Credit Extension" means, the making of a Loan by a Lender.
"Current Debt" means the aggregate amount of current
maturities of the consolidated Debt of the Borrower and its
Subsidiaries including, the Loans (but excluding the Loans (as
defined in the Long Term Credit Agreement) and Debt, if any,
under the Consignment Facilities), determined in accordance with
GAAP.
"Debt" means (i) the outstanding principal and stated amount
of the consolidated Indebtedness of the Borrower and its
Subsidiaries of the nature referred to in clauses (a), (b) and
(c) of the definition of "Indebtedness" and, without duplication,
(ii) any Contingent Liabilities of the Borrower and its
Subsidiaries in respect of any types of the Indebtedness
described in clause (i) above, other than Contingent Liabilities
under the Consignment Facilities; provided, however, that "Debt"
shall not include Indebtedness of Non-Recourse Joint Ventures.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Designated Debt" means the aggregate amount of (i) Current
Debt, and (ii) outstanding Loans and Letter of Credit
Outstandings (as such terms are defined in the Long Term Credit
Agreement).
"Disclosure Schedule" means the Disclosure Schedule attached
hereto as Schedule I, as it may be amended, supplemented or
otherwise modified from time to time by the Borrower with the
written consent of the Administrative Agent and the Required
Lenders.
"Dollar" and the symbol "$" mean lawful money of the United
States.
"Domestic Office" means, relative to any Lender, the office
of such Lender designated as such below its signature hereto or
designated in the Lender Assignment Agreement or such other
office of a Lender (or any successor or assign of such Lender)
within the United States as may be designated from time to time
by notice from such Lender, as the case may be, to each other
party hereto.
"EBIT" shall mean, for any period, the sum for such period
of all amounts which, in accordance with GAAP, would be included
on the consolidated financial statements of the Borrower and its
Subsidiaries as
(a) Net Income;
plus
(b) Interest Expense;
plus
(c) to the extent deducted in determining Net Income,
provisions for income taxes.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 10.8.
"Eligible Receivable" shall mean any Receivable of the
Borrower or any of its Subsidiaries which:
(a) is lawfully owned by the Borrower or such
Subsidiary free and clear of any Lien (other than Liens
permitted under Section 7.2.3);
(b) is a valid, binding and legally enforceable
obligation of the obligor under such Receivable;
(c) is not subject to any dispute, setoff,
counterclaim, or other claim or defense on the part of the
obligor thereunder, and is not subject to an obligor denying
liability under such Receivable in whole or in part;
(d) is a bona fide Receivable arising from the sale
(on an absolute, and not a consignment, approval, or sale-
and-return basis, it being understood that the exchange of
damaged goods by the Borrower or any of its Subsidiaries in
the ordinary course of its business consistent with past
practice shall not constitute any such consignment, approval
or sale and return basis) of goods by the Borrower or such
Subsidiary, in the ordinary course of its business, which
goods have been shipped or delivered to the obligor
thereunder;
(e) is payable not more than 90 days after the
shipping of goods giving rise to such Receivable, and is not
more than 60 days past due;
(f) has not been written off or reserved against; and
(g) is the obligation of an obligor which is neither:
(i) an Affiliate of the Borrower, nor
(ii) the subject of any reorganization,
bankruptcy, receivership, custodianship, insolvency or
other like proceeding, or any other event of the nature
set forth in clauses (a) through (d) of Section 8.1.9;
provided, that notwithstanding the foregoing, "Eligible
Receivable" shall also include 75% of the amount of the GO/DAN
Receivable.
"Environmental Laws" means all applicable federal, state or
local statutes, laws, ordinances, codes, rules, regulations and
guidelines (including consent decrees and administrative orders)
relating to public health and safety and protection of the
environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import,
together with the regulations thereunder, in each case as in
effect from time to time. References to sections of ERISA also
refer to any successor sections.
"Event of Default" is defined in Section 8.1.
"Existing Agreement" means the Short Term Revolving Credit
Agreement, dated as of March 16, 1992 (as amended or otherwise
modified from time to time prior to the Effective Date), among
the Borrower, certain financial institutions parties thereto, The
Bank of Nova Scotia, The Chase Manhattan Bank, N.A. and Chemical
Bank as the co-agents and The Bank of Nova Scotia, as
administrative agent.
"Extension Request" means an extension request duly executed
by an Authorized Officer, substantially in the form of Exhibit G
hereto.
"Federal Funds Rate" means, for any day, a fluctuating
interest rate per annum equal for such day to the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is not a
Business Day in the City of New York, for the next preceding
Business Day) by the Federal Reserve Bank of New York; provided,
however, that if such rate is not so published for any day which
is a Business Day in the City of New York, the rate for such day
shall be the average of the quotations for such day on such
transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it.
"Fee Letter" means the confidential letter agreement, dated
as of June 28, 1994, as modified by the letter agreement dated
July 29, 1994, each by and between the Borrower and Scotiabank
and as further amended, restated, supplemented, amended and
restated or otherwise modified from time to time.
"Fiscal Quarter" means any quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive
calendar months ending on December 31; references to a Fiscal
Year with a number corresponding to any calendar year (e.g. the
"1993 Fiscal Year") refer to the Fiscal Year ending on the
December 31 occurring during such calendar year.
"F.R.S. Board" means the Board of Governors of the Federal
Reserve System or any successor thereto.
"GAAP" is defined in Section 1.4.
"GO/DAN Receivable" means the Receivable owing to the
Borrower on the Effective Date (i) of which GO/DAN Industries is
the account obligor and (ii) which on the Effective Date had a
principal balance of $8,078,571, as such amount may be reduced by
payments thereon from time to time (but not increased in any
manner).
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act;
(c) any crude oil or petroleum or any fraction
thereof;
(d) asbestos, radioactive materials or polychlorinated
biphenyls in any form of condition; or
(e) any pollutant or contaminant or hazardous,
dangerous or toxic chemical, material or substance within
the meaning of any other applicable federal, state or local
law, regulation, ordinance or requirement (including consent
decrees and administrative orders) relating to or imposing
liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material, all as
amended or hereafter amended.
"Hedging Obligations" means, with respect to any Person, all
liabilities of such Person under interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements and
similar agreements and arrangements entered into in respect of
interest rates, and all hedging agreements or arrangements
entered into in respect of fluctuations in currency exchange
rates.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Loan Document refer to
this Agreement or such other Loan Document, as the case may be,
as a whole and not to any particular Section, paragraph or
provision of this Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion
or certification of any independent public accountant as to any
financial statement of the Borrower, any qualification or
exception to such opinion or certification:
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination
of matters relevant to such financial statement; or
(c) which relates to the treatment or classification
of any item in such financial statement and which, as a
condition to its removal, would require an adjustment to
such item the effect of which would be to cause the Borrower
to be in default of any of its obligations under Section
7.2.4.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Loan Document, the parties hereto agree
that the rule of ejusdem generis shall not be applicable to limit
a general statement, which is followed by or referable to an
enumeration of specific matters or to matters specifically
mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money
and all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(b) all obligations (without duplication of
obligations set forth in clause (a)), contingent or
otherwise, relative to the face amount of all letters of
credit, whether or not drawn, and banker's acceptances
issued for the account of such Person;
(c) all obligations of such Person as lessee under
leases which have been or should be, in accordance with
GAAP, recorded as Capitalized Lease Liabilities;
(d) all other items which, in accordance with GAAP,
would be included as liabilities on the liability side of
the balance sheet of such Person as of the date at which
Indebtedness is to be determined (other than deferred
taxes);
(e) net liabilities of such Person under all Hedging
Obligations;
(f) to the extent included as liabilities in
accordance with GAAP, all obligations of such Person to pay
the deferred purchase price of property or services, and
indebtedness (excluding prepaid interest thereon) secured by
a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or
other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is
limited in recourse; and
(g) all Contingent Liabilities of such Person in
respect of any of the foregoing.
For all purposes of this Agreement, the Indebtedness of any
Person shall not include the Indebtedness of a Non-Recourse Joint
Venture.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Interest Coverage Ratio" means, at the close of any Fiscal
Quarter, the ratio, computed for the period consisting of such
Fiscal Quarter and each of the three immediately preceding Fiscal
Quarters, of
(a) EBIT
to
(b) Interest Expense.
"Interest Expense" means, for any period, the aggregate
amount of interest expense of the Borrower and its Subsidiaries
for such period which, in accordance with GAAP, would be included
on the consolidated financial statements of the Borrower,
including without limitation the portion of any rent paid on
Capitalized Lease Liabilities which is allocable to interest
expense in accordance with GAAP and including fees or rents
arising from or relating to consignment or leasing of precious
metals other than up-front fees paid on the Effective Date to the
Lenders. Any such interest expense which is subject to a Hedging
Obligation will be calculated on the net effect of any payments
made by the other party to such Hedging Obligation.
"Interest Period" means
(a) relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO
Rate Loan is made or continued as, or converted into, a LIBO
Rate Loan pursuant to Section 2.3 or 2.3.1 and shall end on
(but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such
month has no numerically corresponding day, on the last
Business Day of such month), as the Borrower may select in
its relevant notice pursuant to Section 2.3 or 2.3.1;
provided, however, that
(i) Interest Periods commencing on the same date
for Revolving Loans comprising part of the same
Borrowing shall be of the same duration,
(ii) if such Interest Period would otherwise end
on a day which is not a Business Day, such Interest
Period shall end on the next following Business Day;
provided, however, that if such next following Business
Day is the first Business Day of a calendar month, such
Interest Period shall end on the next preceding
Business Day, and
(iii) no Interest Period may end later than the
Stated Maturity Date; and
(b) relative to each Competitive Bid Loan made at a
LIBOR Auction, the period commencing on the date of such
Borrowing and ending one, two, three or six months
thereafter, as the Borrower may elect in accordance with
Section 2.4; provided that:
(i) if such Interest Period would otherwise end
on a day which is not a Business Day, such Interest
Period shall end on the next following Business Day;
provided, however, that if such next following Business
Day is the first Business Day of a calendar month, such
Interest Period shall end on the next preceding
Business Day, and
(ii) no Interest Period may end later than the
Stated Maturity Date.
No more than five Interest Periods shall be in effect at any one
time.
"Investment" means any investment in any Person, whether by
means of share purchase, capital, equity or similar contribution,
loan, advance, time deposit or otherwise (excluding commission,
travel and similar advances to officers and employees made in the
ordinary course of business). The amount of any Investment shall
be the original principal or capital amount thereof less all
returns of principal or equity thereon (and without adjustment by
reason of the financial condition of such other Person) and
shall, if made by the transfer or exchange of property other than
cash, be deemed to have been made in an original principal or
capital amount equal to the fair market value of such property,
as reasonably determined in good faith by the Borrower at the
time of such transfer or exchange.
"Invitation for Bid Loan Quotes" means an Invitation for Bid
Loan Quotes delivered by the Administrative Agent to the Lenders
pursuant to clause (b) of Section 2.4, in substantially the form
of Exhibit C-1 hereto.
"Lender Assignment Agreement" means a Lender Assignment
Agreement substantially in the form of Exhibit D attached hereto.
"Lenders" is defined in the preamble.
"Letters of Credit to be Replaced" means those letters of
credit listed on Item 1.1 ("Letters of Credit to be Replaced") of
the Disclosure Schedule which are outstanding on the Effective
Date which are to be replaced with Letters of Credit (as defined
in the Long Term Credit Agreement).
"Leverage Ratio" means, as of the last day of any Fiscal
Quarter, the ratio of
(a) Debt (other than obligations (contingent or
otherwise) relative to the face amount of all letters of
credit, whether or not drawn, issued for the account of the
Borrower and its Subsidiaries)
to
(b) Adjusted Consolidated Tangible Net Worth.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Bid Margin" means, in respect of Competitive Bid
Loans based on a LIBOR Auction, the margin above or below the
applicable LIBO Rate offered for each such Competitive Bid Loan,
expressed as a percentage (rounded to the nearest 1/10,000th of
1%) to be added to such rate.
"LIBO Rate Loan" means a Revolving Loan bearing interest, at
all times during an Interest Period applicable to such Revolving
Loan, at a fixed rate of interest determined by reference to the
LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Auction" means a solicitation of Competitive Bid Loan
quotes pursuant to Section 2.4 hereof based on the LIBO Rate.
"LIBOR Office" means, relative to any Lender, the office of
such Lender designated as such below its signature hereto or
designated in the Lender Assignment Agreement or such other
office of a Lender as designated from time to time by notice from
such Lender to the Borrower and the Administrative Agent, whether
or not outside the United States, which shall be making or
maintaining LIBO Rate Loans or Competitive Bid Loans based on a
LIBOR Auction.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or otherwise), charge against or interest in property
to secure payment of a debt or performance of an obligation or
other priority or preferential arrangement of any kind or nature
whatsoever.
"Loan Commitment Amount" means, on any day, $53,750,000, as
such amount may be reduced from time to time pursuant to
Section 2.2.
"Loan Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Loan Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2; and
(c) the date on which any Commitment Termination Event
occurs.
Upon the occurrence of any event described in clause (b) or (c),
the Revolving Loan Commitment and Swing Line Loan Commitment
shall terminate automatically and without further action.
"Loan Document" means this Agreement, the Notes, the Fee
Letter and each other agreement, document or instrument delivered
pursuant hereto or thereto, whether or not mentioned herein or
therein.
"Loans" means, as the context may require, either a Swing
Line Loan, a Competitive Bid Loan or a Revolving Loan.
"Long Term Credit Agreement" means the Revolving Credit
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified from time to time),
among the Borrower, the various financial institutions as are or
may become parties thereto, Scotiabank, Chemical and BONY, as co-
agents and Scotiabank, as administrative agent.
"Market Value" for precious metals shall mean, as of the
date of any determination thereof, the value based on the average
of the prices of such asset, with respect to gold or silver, as
published by Handy & Harman (or if not so published by Handy &
Harman, the price as determined by the London P.M. Fix on such
date), and, with respect to platinum or palladium, as determined
by the London P.M. Fix, on each day during the three month period
ending on the date of such determination.
"Net Income" means, for any period, the consolidated net
income of the Borrower and its Subsidiaries for such period
(excluding any extraordinary gains and losses).
"Non-Consenting Lender" is defined in clause (d) of
Section 2.6.2.
"Non-Recourse Joint Venture" means a joint venture (i) to
which a Non-Recourse Subsidiary is a party and (ii) whose
Indebtedness is non-recourse to the Borrower or any of its
Subsidiaries which is not the Non-Recourse Subsidiary party
thereto or any of their respective assets.
"Non-Recourse Subsidiary" means a direct or indirect
Subsidiary of the Borrower (i) which was formed solely for the
purpose of entering into a Non-Recourse Joint Venture and (ii)
whose Indebtedness is non-recourse to the Borrower or any other
Subsidiary of the Borrower or any of their respective assets.
"Note" means, as the context may require, a Competitive Bid
Loan Note, a Swing Line Loan Note or a Revolving Loan Note.
"Obligations" means all obligations (monetary or otherwise)
of the Borrower arising under or in connection with this
Agreement, the Notes and each other Loan Document.
"Organic Document" means, relative to the Borrower, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Participant" is defined in Section 10.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and
any entity succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is
defined in section 3(2) of ERISA, which is subject to Title IV of
ERISA (other than a multiemployer plan as defined in section
4001(a)(3) of ERISA), and to which the Borrower or any
corporation, trade or business that is, along with the Borrower,
a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within
the meaning of section 4063 of ERISA at any time during the
preceding five years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage
set forth opposite its signature hereto or set forth in the
Lender Assignment Agreement, as such percentage may be adjusted
from time to time pursuant to Lender Assignment Agreement(s)
executed by such Lender and its Assignee Lender(s) and delivered
pursuant to Section 10.11.1.
"Person" means any natural person, corporation, partnership,
firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or other
capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Quarterly Payment Date" means the last day of each March,
June, September and December or, if any such day is not a
Business Day, the next succeeding Business Day.
"Receivable" shall mean any account (as that term is defined
in Section 9-106 of the Uniform Commercial Code as in effect,
from time to time, in the State of New York) and any instrument
(as that term is defined in Section 9-105 of the Uniform
Commercial Code as in effect from time to time, in the State of
New York).
"Reference Lenders" means Scotiabank, BONY and Chemical.
"Release" means a "release", as such term is defined in
CERCLA.
"Replacement Notice" is defined in Section 4.11.
"Required Lenders" means, at any time,
(a) with respect to any provision of this Agreement
other than the declaration of the acceleration of the
maturity of all or any portion of the outstanding principal
amount of the Credit Extensions and other Obligations to be
due and payable pursuant to Section 8.3, Lenders whose
Percentages equal or exceed 51%; or
(b) with respect to the declaration of the
acceleration of the maturity of all or any portion of the
outstanding principal amount of the Credit Extensions and
other Obligations to be due and payable pursuant to
Section 8.3, Lenders holding 51% or more of the aggregate
principal amount of the Credit Extensions then outstanding.
"Resource Conservation and Recovery Act" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 690, et seq., as
in effect from time to time.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Borrowing" means Revolving Loans of the same
type and, in the case of LIBO Rate Loans, having the same
Interest Period, made by all Lenders on the same Business Day
pursuant to the same Revolving Loan Borrowing Request in
accordance with Section 2.1.
"Revolving Loan Borrowing Request" means a certificate
requesting Revolving Loans duly executed by an Authorized
Officer, substantially in the form of Exhibit B-1 attached
hereto.
"Revolving Loan Commitment" is defined in Section 2.1.1.
"Revolving Loan Note" means any promissory note of the
Borrower in the form of Exhibit A-1 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to
such Lender resulting from Revolving Loans outstanding from such
Lender, and also means all other promissory notes accepted from
time to time in substitution therefor or renewal thereof.
"Scotiabank" is defined in the preamble.
"Stated Maturity Date" means September 26, 1995, as such
date may be extended pursuant to Section 2.6; provided, that in
no event shall the Stated Maturity Date be extended beyond the
Stated Maturity Date (as such term is defined in the Long Term
Credit Agreement) of the Indebtedness outstanding under the Long
Term Credit Agreement.
"Subject Lender" is defined in Section 4.11.
"Subsidiary" means, with respect to any Person, any
corporation of which more than 50% of the outstanding capital
stock having ordinary voting power to elect a majority of the
board of directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence
of any contingency) is at the time directly or indirectly owned
by such Person, by such Person and one or more other Subsidiaries
of such Person, or by one or more other Subsidiaries of such
Person.
"Swing Line Lender" means Scotiabank in its individual
capacity hereunder (and not in its capacity as a Co-Agent or the
Administrative Agent). At the request of Scotiabank another
Lender consented to by the Borrower (such consent not to be
unreasonably withheld) may become a successor Swing Line Lender.
"Swing Line Loan Borrowing" means Swing Line Loans (which
shall be made as Base Rate Loans) made by the Swing Line Lender
on the same Business Day pursuant to a Revolving Loan Borrowing
Request in accordance with Section 2.1.
"Swing Line Loan Commitment" is defined in Section 2.1.2.
"Swing Line Loan Commitment Amount" means, on any day,
$10,000,000, as such amount may be reduced from time to time
pursuant to Section 2.2.
"Swing Line Loan Note" means any promissory note of the
Borrower in the form of Exhibit A-3 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to
the Swing Line Lender resulting from Swing Line Loans outstanding
from the Swing Line Lender, and also means all other promissory
notes accepted from time to time in substitution therefor or
renewal thereof.
"Swing Line Loans" is defined in Section 2.1.2.
"Taxes" is defined in Section 4.6.
"type" means, relative to any Loan, the portion thereof, if
any, being maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of
America, its fifty States and the District of Columbia.
"Welfare Plan" means a "welfare plan", as such term is
defined in section 3(1) of ERISA.
SECTION 1.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires, terms for which
meanings are provided in this Agreement shall have such meanings
when used in the Disclosure Schedule and in any Loan Document,
Borrowing Request, Continuation/Conversion Notice, notice and
other communication delivered from time to time in connection
with this Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Loan Document to
any Article or Section are references to such Article or Section
of this Agreement or such other Loan Document, as the case may
be, and, unless otherwise specified, references in any Article,
Section or definition to any clause are references to such clause
of such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations; No
Duplication; Consolidation. Unless otherwise specified, (i) all
accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations
hereunder or thereunder (including under Section 7.2.4) shall be
made, and all financial statements required to be delivered
hereunder or thereunder shall be prepared in accordance with,
generally accepted accounting principles in the U.S. ("GAAP"),
and (ii) all accounting determinations and computations hereunder
or under any other Loan Documents (including under Section 7.2.4)
shall be made without duplication and on a consolidated basis for
the Borrower and its Subsidiaries.
ARTICLE II
COMMITMENTS, BORROWING AND BIDDING
PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the
conditions of this Agreement (including Article V),
(a) each Lender severally agrees to make Revolving
Loans pursuant to the Revolving Loan Commitment described in
Section 2.1.1; and
(b) the Swing Line Lender agrees to make Swing Line
Loans pursuant to the Swing Line Loan Commitment described
in Section 2.1.2.
SECTION 2.1.1. Revolving Loan Commitment. From time to
time on any Business Day occurring prior to the Loan Commitment
Termination Date, each Lender will make loans (relative to such
Lender, and of any type, its "Revolving Loans") to the Borrower
equal to such Lender's Percentage of the aggregate amount of the
Revolving Loan Borrowing requested by the Borrower to be made on
such day. The commitment of each Lender described in this
Section 2.1.1 is herein referred to as its "Revolving Loan
Commitment". On the terms and subject to the conditions hereof,
the Borrower may from time to time prior to the Loan Commitment
Termination Date borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.2. Swing Line Loan Commitment. From time to
time on any Business Day occurring prior to the Loan Commitment
Termination Date, the Swing Line Lender will make loans (referred
to herein as "Swing Line Loans") to the Borrower as Base Rate
Loans equal to the aggregate amount of Swing Line Loans being
requested by the Borrower to be made on such day. The commitment
of the Swing Line Lender described in this Section 2.1.2 is
herein referred to as its "Swing Line Loan Commitment." On the
terms and subject to the conditions hereof, the Borrower may from
time to time prior to the Loan Commitment Termination Date,
borrow, prepay and reborrow Swing Line Loans.
SECTION 2.1.3. Lenders Not Permitted or Required to Make
Revolving Loans or Swing Line Loans. No Lender shall be
permitted or required to make any Revolving Loan or Swing Line
Loan if, after giving effect thereto and to any repayment of
Credit Extensions to be made with the proceeds thereof, the
aggregate unpaid principal amount of
(a) all Loans outstanding to all Lenders would exceed
the Loan Commitment Amount; or
(b) all Swing Line Loans outstanding to the Swing Line
Lender would exceed the Swing Line Loan Commitment Amount.
SECTION 2.2. Reduction of Commitments. The Borrower may,
from time to time on any Business Day occurring after the time of
the initial Borrowing hereunder, voluntarily reduce the Loan
Commitment Amount or the Swing Line Loan Commitment Amount;
provided, however, that (i) all such reductions shall require at
least three Business Days' prior written irrevocable notice to
the Administrative Agent and be permanent, and (ii) any partial
reduction of (A) the Loan Commitment Amount shall be in a minimum
amount of $5,000,000 and in an integral multiple of $500,000, and
(B) the Swing Line Loan Commitment Amount shall be in a minimum
amount of $1,000,000 and in an integral multiple of $250,000; and
provided, further, that the Borrower may terminate the
Commitments in whole if, at the time of and as a condition of
such termination, the Borrower shall have repaid in full the
aggregate outstanding principal amount of all Revolving Loans and
Swing Line Loans, together with all accrued interest and fees
thereon to the date of termination.
SECTION 2.3. Revolving Loan and Swing Line Loan Borrowing
Procedure and Funding Maintenance. (a) Revolving Loans. By
delivering a Revolving Loan Borrowing Request to the
Administrative Agent at or before 10:00 a.m. (New York City
time), on a Business Day, the Borrower may from time to time
irrevocably request, (x) on not less than three nor more than
five Business Days' notice, in the case of LIBO Rate Loans, and
(y) on not more than five Business Days' notice (but before
10:30 a.m. (New York City time) on the date such Borrowing is to
occur), in the case of Base Rate Loans, that a Revolving Loan
Borrowing be made by all the Lenders in a minimum amount of
$5,000,000 and an integral multiple of $500,000, or, if less, in
the unused amount of the Revolving Loan Commitment. The
Administrative Agent shall promptly notify each Lender of the
receipt of a Revolving Loan Borrowing Request. On the terms and
subject to the conditions of this Agreement, each Revolving Loan
Borrowing shall be comprised of the type of Revolving Loans, and
shall be made on the Business Day, specified in such Revolving
Loan Borrowing Request. On or before 11:00 a.m. (New York City
time) (in the case of LIBO Rate Loans), and 12:00 (noon) (New
York City time), in the case of a Base Rate Loan, on the Business
Day that such Revolving Loan Borrowing is to be made, each Lender
shall deposit with the Administrative Agent immediately available
funds in an amount equal to such Lender's Percentage of the
requested Revolving Loan Borrowing. Such deposit will be made to
an account which the Administrative Agent shall specify from time
to time by notice to the Lenders. To the extent funds are
received from the Lenders, the Administrative Agent shall make
such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Revolving Loan
Borrowing Request. No Lender's obligation to make any Revolving
Loan shall be affected by any other Lender's failure to make any
Revolving Loan.
(b) Swing Line Loans. By written or telephonic notice to
the Swing Line Lender on or before 11:00 a.m. (New York City
time), on a Business Day the Borrower may from time to time
request that Swing Line Loans be made by the Swing Line Lender on
such Business Day (or the next succeeding Business Day) in an
aggregate minimum principal amount of $1,000,000 and an integral
multiple of $250,000. All telephonic notices shall be confirmed
on the same Business Day by the delivery to the Administrative
Agent of an appropriately completed Revolving Loan Borrowing
Request. All Swing Line Loans shall be made as Base Rate Loans.
The proceeds of each Swing Line Loans shall be made available by
the Swing Line Lender to the Borrower by wire transfer of such
proceeds to such transferees, or to such accounts of the
Borrower, as the Borrower shall have specified in its notice
therefor.
(c) If the outstanding principal amount of any Swing Line
Loan is not repaid when due pursuant to the terms of this
Agreement, each Lender (other than the Swing Line Lender)
irrevocably agrees that it will, upon receipt of a notice from
the Swing Line Lender, promptly (and in any event within one
Business Day) transfer to the Swing Line Lender, in immediately
available funds, an amount equal to such Lender's Percentage of
the then aggregate outstanding amount of all Swing Line Loans,
and thereafter such Loans shall constitute a Revolving Loan made
by such Lender thereunder.
SECTION 2.3.1. Continuation and Conversion Elections. By
delivering a Continuation/Conversion Notice to the Administrative
Agent on or before 10:00 a.m. (New York City time), on a Business
Day, the Borrower may from time to time irrevocably elect, on not
less than three nor more than five Business Days' notice that
all, or any portion in an aggregate minimum amount of $5,000,000
and an integral multiple of $500,000, of any Revolving Loans be,
in the case of Base Rate Loans, converted into LIBO Rate Loans
or, in the case of LIBO Rate Loans, on the last day of an
Interest Period with respect thereto be converted into a Base
Rate Loan or continued as a LIBO Rate Loan (in the absence of
delivery of a Continuation/Conversion Notice with respect to any
LIBO Rate Loan at least three Business Days before the last day
of the then current Interest Period with respect thereto, such
LIBO Rate Loan shall, on such last day, automatically convert to
a Base Rate Loan); provided, however, that (i), except as
provided in Section 4.1, each such conversion or continuation
shall be pro rated among the applicable outstanding Revolving
Loans of all Lenders, and (ii) no portion of the outstanding
principal amount of any Revolving Loan may be continued as, or be
converted into, a LIBO Rate Loan when any Default has occurred
and is continuing.
SECTION 2.3.2. Funding. Each Lender may, if it so elects,
fulfill its obligation to make, continue or convert LIBO Rate
Loans hereunder, or to make a Competitive Bid Loan based on a
LIBOR Auction, by causing one of its foreign branches or
Affiliates (or an international banking facility created by such
Lender) to make or maintain such LIBO Rate Loan or Competitive
Bid Loan, as the case may be; provided, however, that such LIBO
Rate Loan or Competitive Bid Loan, as the case may be, shall
nonetheless be deemed to have been made and to be held by such
Lender, and the obligation of the Borrower to repay such LIBO
Rate Loan or Competitive Bid Loan, as the case may be, shall
nevertheless be to such Lender for the account of such foreign
branch, Affiliate or international banking facility. In
addition, the Borrower hereby consents and agrees that, for
purposes of any determination to be made for purposes of
Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively assumed
that each Lender elected to fund all LIBO Rate Loans and
Competitive Bid Loans based on a LIBOR Auction by purchasing
Dollar deposits in its LIBOR Office's interbank eurodollar
market.
SECTION 2.4. Competitive Bid Loans. Subject to the terms
and conditions of this Agreement (including Article V), each
Lender severally agrees that the Borrower may request that
Competitive Bid Loan Borrowings under this Section 2.4 be made
from time to time on any Business Day prior to the date occurring
15 Business Days prior to the Loan Commitment Termination Date in
the manner set forth below; provided, however, that following the
making of each Competitive Bid Loan Borrowing, the aggregate
amount of all Loans then outstanding shall not exceed the Loan
Commitment Amount and the Borrower hereby agrees to make a
mandatory prepayment of Loans on the date of each Competitive Bid
Loan Borrowing with the proceeds of Competitive Bid Loans to the
extent necessary (i) to reduce the outstanding principal amount
of all Loans (after giving effect to such Competitive Bid Loan
Borrowing) to an amount not in excess of the Loan Commitment
Amount, and (ii) to prepay the aggregate outstanding principal
amount of all Swing Line Loans.
(a) Competitive Bid Loan Borrowing Request. The
Borrower may request Competitive Bid Loan Borrowings under
this Section 2.4 by delivering to the Administrative Agent,
not later than 10:00 a.m. (New York City time) at least (x)
five Business Days prior to the date of the proposed
Competitive Bid Loan Borrowing (in the case of LIBOR
Auctions) or (y) one Business Day prior to the date of the
proposed Competitive Bid Loan Borrowing (in the case of an
Absolute Rate Auction), a revocable Competitive Bid Loan
Borrowing Request (which shall constitute an invitation to
the Lenders to extend Competitive Bid Loan quotes to the
Borrower, and which may contain requests for up to three
different Competitive Bid Loan Borrowings), specifying
(i) the proposed date (which shall be a Business
Day) and aggregate principal amount or amounts of each
Competitive Bid Loan to be made as part of such
proposed Competitive Bid Loan Borrowing (each of which
such Competitive Bid Loan shall be in a minimum
principal amount of $5,000,000 and in an integral
multiple of $500,000) (and, subject to the proviso
contained in the first sentence of this Section, which
principal amount may exceed the Loan Commitment Amount
then available to be borrowed),
(ii) whether the Competitive Bid Loan quotes
requested are to set forth a LIBO Rate Bid Margin or an
Absolute Rate (or a combination thereof),
(iii) the proposed maturity date or dates (each a
"Competitive Bid Loan Maturity Date") for repayment of
each Competitive Bid Loan to be made as part of such
Competitive Bid Loan Borrowing (which maturity date or
dates may not be later than the earlier of the date
occurring (A) six months after the date of such
Competitive Bid Loan Borrowing or (B) the Loan
Commitment Termination Date), and
(iv) in the case of Competitive Bid Loans based
on the LIBOR Auction, the proposed duration of the
Interest Period applicable thereto.
(b) Invitation for Bid Loan Quotes. Promptly upon
receipt of a Competitive Bid Loan Borrowing Request but in
no event later than 2:30 p.m. (New York City time) on the
date of such receipt, the Administrative Agent shall send to
the Lenders by facsimile an Invitation for Bid Loan Quotes
substantially in the form of Exhibit C-1 attached hereto
containing the information contained in the applicable
Competitive Bid Loan Request and which shall constitute an
invitation by the Borrower to each Lender to submit
Competitive Bid Loan quotes in response thereto.
(c) Submission and Contents of Bid Loan Quotes.
(i) If any Lender, in its sole discretion, elects
to offer to make a Competitive Bid Loan to the Borrower
as part of such proposed Competitive Bid Loan Borrowing
at a rate of interest specified by such Lender in its
sole discretion, it shall deliver to the Administrative
Agent not later than (x) 11:00 a.m. (New York City
time) on the fourth Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or
(y) 9:30 a.m. (New York City time) on the proposed date
of Borrowing, in the case of an Absolute Rate Auction,
a Competitive Bid Loan Offer, which must comply with
the requirements of this clause, in the form of Exhibit
C-2 hereto; provided, that Competitive Bid Loan quotes
submitted by the Administrative Agent (or any affiliate
of the Administrative Agent) in the capacity of a
Lender may be submitted, and may only be submitted, if
the Administrative Agent or such affiliate notifies the
Borrower of the terms of the offer or offers contained
therein not later than (x) 10:45 a.m. (New York City
time) on the fourth Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or
(y) 9:15 a.m. (New York City time) on the proposed date
of Borrowing, in the case of an Absolute Rate Auction.
Subject to Articles V and VIII, such Competitive Bid
Loan Offer shall be irrevocable except with the written
consent of the Administrative Agent, given on the
instructions of the Borrower, and shall specify
(A) the proposed date of Borrowing, which
shall be the same as that set forth in the
applicable Invitation for Bid Loan Quotes,
(B) the principal amount of the Competitive
Bid Loan which such Lender would be willing to
make as part of such proposed Competitive Bid Loan
Borrowing, which principal amount may be greater
than, less than or equal to such Lender's
Percentage of the Loan Commitment Amount, but
which amount shall be in a minimum principal
amount of $5,000,000 and in an integral multiple
of $1,000,000,
(C) in the case of a LIBOR Auction, the LIBO
Rate Bid Margin, and in the case of an Absolute
Rate Auction, the Absolute Rate therefor, and
(D) the identity of the quoting Lender.
(ii) Any Competitive Bid Loan Offer that:
(A) is not substantially in the form of
Exhibit C-2 hereto or does not specify all of the
information required in clause (c) of this
Section;
(B) contains qualifying, conditional or
similar language;
(C) contains proposed terms other than or
in addition to those set forth in the applicable
Invitation for Bid Loan Quotes; or
(D) arrives after the time set forth in
clause (c) of this Section
shall be disregarded by the Administrative Agent.
(d) Notice to Borrower. The Administrative Agent
shall (by telephone confirmed by telecopy), by 1:00 p.m.
(New York City time) (on the fourth Business Day prior to
the proposed date of Borrowing, in the case of a LIBOR
Auction) and 10:00 a.m. (New York City time) (on the
proposed date of Borrowing, in the case of an Absolute Rate
Auction) notify the Borrower of the terms of any
Competitive Bid Loan Offer submitted by a Lender that is in
accordance with clause (c) of this Section. Any subsequent
Competitive Bid Loan Offer of a Lender shall be disregarded
by the Administrative Agent unless such subsequent
Competitive Bid Loan Offer is submitted solely to correct a
manifest error in such earlier Competitive Bid Loan Offer.
The Administrative Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Competitive
Bid Loans for which offers have been received in respect of
the related Invitation for Bid Loan Quotes, (B) the
respective principal amounts and Competitive Bid Rates so
offered, and (C) the identity of such quoting Lenders.
(e) Competitive Bid Loan Acceptance. The Borrower
shall, in turn, before (x) 4:00 p.m. (New York City time)
on the fourth Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction, or (y) 12:00
(noon) (New York City time) on the date of such proposed
Competitive Bid Loan Borrowing, in the case of an Absolute
Rate Auction, either
(i) irrevocably cancel the Competitive Bid Loan
Borrowing Request that requested such Competitive Bid
Loan Borrowing by giving the Administrative Agent
(which shall promptly notify each Lender) telephonic
notice (promptly confirmed in writing) to that effect
(and, for purposes of this Section, a failure on the
part of the Borrower to timely notify the
Administrative Agent under the terms of this clause
shall be deemed to be non-acceptance of all offers so
notified to it pursuant to clause (d) above), or
(ii) irrevocably accept one or more of the
offers made by any Lender or Lenders pursuant to
clause (d) above, in its sole discretion, by giving
the Administrative Agent telephonic notice (and the
Administrative Agent shall, promptly upon receiving
such telephonic notice from the Borrower, notify each
Lender whose Competitive Bid Loan Offer has been
accepted) (promptly confirmed in writing by delivery
to the Administrative Agent of a Competitive Bid Loan
Borrowing Notice, copies of which shall thereafter be
forwarded to each of the Lenders) of
(A) the amount of the Competitive Bid Loan
Borrowing to be made on such date,
and
(B) the amount of the Competitive Bid Loan
(which amount shall not be greater than, but
which may be less than, the amount offered by
such Lender for such Competitive Bid Loan
pursuant to clause (d) above) to be made by such
Lender as part of such Competitive Bid Loan
Borrowing, and reject any remaining offers made
by Lenders pursuant to clause (d) above by giving
the Administrative Agent (which shall promptly
give to the Lenders) notice to that effect;
provided, however, that
(C) the aggregate amount of the Competitive
Bid Loan Offers accepted by the Borrower shall
not exceed the principal amount specified in the
applicable Competitive Bid Loan Borrowing
Request,
(D) no Lender shall, without its prior
written consent (in its sole discretion), be
required to make a Competitive Bid Loan in a
principal amount of less than $5,000,000 and
integrals of $1,000,000;
(E) no bid shall be accepted for a
Competitive Bid Loan unless such Competitive Bid
Loan is in a minimum principal amount of
$5,000,000 (except as provided in clause (D)
above) and an integral multiple of $1,000,000 and
is part of a Competitive Bid Loan Borrowing in a
minimum principal amount of $5,000,000, and
(F) the Borrower may not accept any offer
that is described in clause (c)(ii) of this
Section, or that otherwise fails to comply with
the requirements of this Agreement.
(f) Funding of Competitive Bid Loans. Not later than
11:00 a.m. (New York City time) (in the case of a Borrowing
based on a LIBOR Auction) and 1:00 p.m. (New York City
time) (in the case of a Borrowing based on an Absolute Rate
Auction), in each case on the date specified for each
Competitive Bid Loan hereunder, each Lender participating
therein shall make available the amount of the Competitive
Bid Loan to be made by it on such date to the
Administrative Agent in immediately available funds, for
the account of the Borrower, such deposit to be made to an
account maintained by the Administrative Agent, as the
Administrative Agent shall specify from time to time by
notice to the Lenders or as otherwise agreed to in writing
by the Administrative Agent and the Borrower. The amount
so received by the Administrative Agent shall promptly be
made available to the Borrower by depositing the same in
immediately available funds in an account of the Borrower's
notified to the Administrative Agent in writing.
SECTION 2.5. Notes. Each Lender's Loans under its
Commitments shall be evidenced by a Note payable to the order of
such Lender in a maximum principal amount equal to
(a) in the case of Revolving Loans, such Lender's
Percentage of the original Loan Commitment Amount;
(b) in the case of Competitive Bid Loans,
$50,000,000; and
(c) in the case of Swing Line Loans, $10,000,000.
The Borrower hereby irrevocably authorizes each Lender to make
(or cause to be made) appropriate notations on the grid attached
to such Lender's Note (or on any continuation of such grid),
which notations, if made, shall evidence, inter alia, the date
of, the outstanding principal amount of, and the interest rate
and Interest Period (in the case of Revolving Loan Notes) and the
Competitive Bid Loan Maturity Dates and Interest Period (if
applicable) (in the case of Competitive Bid Loan Notes)
applicable to the Loans evidenced thereby. Such notations shall
be prima facie evidence of the matters stated therein, absent
manifest error; provided, however, that the failure of any Lender
to make any such notations shall not limit or otherwise affect
any Obligations of the Borrower.
SECTION 2.6. Extension of Stated Maturity Date and
Maturity of Loans. Each of (i) the Stated Maturity Date and (ii)
the obligation, pursuant to Section 3.1.1, to make a mandatory
repayment of the outstanding principal amount of Loans on the
Stated Maturity Date, shall be subject to extension or
postponement, as the case may be, as set forth in this Section.
SECTION 2.6.1. Request for Extension of Stated Maturity
Date and Maturity of Loans. Any term or provision of this
Agreement to the contrary notwithstanding, no earlier than
60 days nor later than 45 days prior to the then Stated Maturity
Date (if the Revolving Loan Commitment then remains in effect),
the Borrower may, by delivery of a duly completed Extension
Request to the Administrative Agent, irrevocably request that
each Lender and the Swing Line Lender extend for an additional
364 day period (such period to commence on the day immediately
following the then Stated Maturity Date) the Stated Maturity Date
relating to such Lender's Revolving Loan Commitment (which shall
also be deemed to be a request that the Swing Line Lender extend
for such period the Swing Line Loan Commitment); provided, that
the Stated Maturity Date shall not be extended beyond the Stated
Maturity Date (as such term is defined in the Long Term Credit
Agreement). The failure of the Borrower to request such an
extension hereunder shall automatically terminate the Borrower's
rights to request additional such extensions.
SECTION 2.6.2. Consent to Extension of Stated Maturity
Date and Maturity of Loans. (a) The Administrative Agent shall,
promptly after receipt of any such Extension Request pursuant to
Section 2.6.1, notify each Lender thereof by providing them a
copy of such Extension Request.
(b) Each Lender shall, within 30 days of receipt of the
notice described in clause (a), notify the Administrative Agent
whether or not it consents to the request of the Borrower set
forth in such Extension Request, such consent to be in the sole
discretion of such Lender. If any Lender does not so notify the
Administrative Agent of its decision within such 30 day period,
such Lender, shall be deemed not to have consented to such
requests of the Borrower.
(c) The Administrative Agent shall promptly notify the
Borrower whether the Lenders have consented to such request. If
the Administrative Agent does not so notify the Borrower within 5
days prior to the then existing Stated Maturity Date, the
Administrative Agent shall be deemed to have notified the
Borrower that the Lenders have not consented to the Borrower's
request.
(d) Each Lender that elects not to provide a new Revolving
Loan Commitment upon the expiration of the then effective Stated
Maturity Date or that fails to so notify the Administrative Agent
of such consent (a "Non-Consenting Lender") hereby agrees that
if, on or prior to the then effective Stated Maturity Date, any
other Lender or other financial institution acceptable to the
Borrower and the Administrative Agent offers to purchase such
Non-Consenting Lender's Percentage of the Revolving Loan
Commitment for a purchase price equal to the sum of all amounts
then owing with respect to the Revolving Loans and all other
amounts accrued for the account of such Non-Consenting Lender,
such Non-Consenting Lender will assign, sell and transfer on the
then effective Stated Maturity Date all of its right, title,
interest and obligations with respect to the foregoing to such
other Lender or financial institution pursuant to the terms of
Section 10.11.1 and the fee payable pursuant to Section 10.11.1
shall be payable by such Assignee Lender.
(e) On the date that would have been the Stated Maturity
Date had the Revolving Loan Commitment not been extended pursuant
to the terms of this Section, the Revolving Loans of any Non-
Consenting Lender that were not purchased pursuant to clause (d)
will mature and be due and payable on the then scheduled Stated
Maturity Date, and the Commitments of such Non-Consenting Lender
will thereupon terminate. On such Stated Maturity Date, the Loan
Commitment Amount will be automatically reduced by an amount
equal to the product of
(i) the sum of the Percentages of all Non-Consenting
Lenders that were not purchased pursuant to clause (d), and
(ii) the Loan Commitment Amount (whether used or
unused) on such Stated Maturity Date immediately prior to
such calculation.
(f) The Percentages of the remaining Lenders which have
consented to an extension of their Commitment hereunder shall be
adjusted accordingly by the Administrative Agent, based on such
Lenders' pro rata share of the remaining Loan Commitment Amount.
Notwithstanding anything to the contrary contained in this
Section, the Stated Maturity Date of those Lenders consenting to
such an extension shall not be extended for an additional 364 day
period unless Lenders whose Percentages equal or exceed 75%
(after giving effect to the operation of clause (d)), agree to
such an extension.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. Repayments and
prepayments of Loans shall be made as set forth in this Section
3.1. Each repayment or prepayment of any Loan made pursuant to
this Section 3.1 shall be without premium or penalty, except as
may be required by Section 4.4. No voluntary prepayment of
principal of any Revolving Loans or Swing Line Loans shall cause
a reduction in the Loan Commitment Amount or the Swing Line Loan
Commitment Amount, as the case may be.
SECTION 3.1.1. Final Maturity. The Borrower shall repay
in full the entire unpaid principal amount of each Revolving Loan
and Swing Line Loan upon the Stated Maturity Date therefor and
each Competitive Bid Loan upon the Competitive Bid Loan Maturity
Date therefor.
SECTION 3.1.2. Voluntary Prepayments. From time to time
on any Business Day prior to the Stated Maturity Date, the
Borrower may make a voluntary prepayment, in whole or in part, of
the outstanding principal amount of any Revolving Loans or Swing
Line Loans; provided, however, that
(a) any such prepayment of Revolving Loans shall be
made pro rata among Revolving Loans of the same type and,
if applicable, having the same Interest Period of all
Lenders;
(b) no such prepayment of any LIBO Rate Loan or a
Competitive Bid Loan may be made on any day other than the
last day of the Interest Period for such Loan, unless the
Borrower shall have given the Administrative Agent at least
two (but no more than five) Business Days' notice, and has
paid any costs required pursuant to Section 4.4;
(c) all such voluntary prepayments shall require at
least one but no more than five Business Days' prior
written notice to the Administrative Agent, which shall
promptly notify the Lenders; and
(d) all such voluntary partial prepayments shall be
in an aggregate minimum amount of $5,000,000 and an
integral multiple of $500,000, and in the case of Swing
Line Loans, be in an aggregated minimum amount of
$1,000,000 and an integral multiple of $250,000.
SECTION 3.1.3. Mandatory Prepayments. On each date when
(a) the aggregate outstanding principal amount of all outstanding
Loans (after giving effect to the use of proceeds of any
Borrowing made on such date) exceeds the Loan Commitment Amount,
as it may have been reduced pursuant to Section 2.2 or 2.6.2, the
Borrower shall make a mandatory prepayment of all Loans equal to
the excess, if any, of the amount of such sum over the Loan
Commitment Amount and (b) a Lender or Lenders make a Competitive
Bid Loan or a Revolving Loan, the Borrower shall prepay the
aggregate principal amount of all Swing Line Loans then
outstanding; provided, that, in any event, the Borrower shall
prepay the aggregate outstanding principal amount of each Swing
Line Loan within five Business Days following the making of such
Swing Line Loan.
SECTION 3.1.4. Acceleration of Stated Maturity Date.
Immediately upon any acceleration of the Stated Maturity Date of
any Loans pursuant to Section 8.2 or Section 8.3, the Borrower
shall repay all Loans to the full extent of such acceleration.
SECTION 3.2. Interest Provisions. Interest on the
outstanding principal amount of Loans shall accrue and be payable
in accordance with this Section 3.2.
SECTION 3.2.1. Rates. Pursuant to an appropriately
delivered Borrowing Request or Continuation/Conversion Notice,
the Borrower may elect that Loans comprising a Borrowing accrue
interest at any of the following rates per annum:
(i) On that portion of such Borrowing maintained as
Base Rate Loans, such rate shall be equal to the Alternate
Base Rate from time to time in effect;
(ii) On that portion of such Borrowing maintained as
LIBO Rate Loans, during each Interest Period applicable
thereto, such rate shall be equal to the sum of the LIBO
Rate (Reserve Adjusted) for such Interest Period plus a
margin of 1%; and
(iii) On that portion of such Borrowing maintained as
Competitive Bid Loans, equal to the applicable Competitive
Bid Rate specified by the Lender making such Competitive
Bid Loan in its Competitive Bid Loan Offer with respect
thereto delivered by such Lender and accepted by the
Borrower pursuant to Section 2.4.
The "LIBO Rate (Reserve Adjusted)" means, relative to any
Loan to be made, continued or maintained as, or converted into, a
LIBO Rate Loan for any Interest Period, a rate per annum (rounded
upwards, if necessary, to the nearest 1/16 of 1%) determined
pursuant to the following formula:
LIBO Rate = LIBO Rate
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period
for LIBO Rate Loans will be determined by the Administrative
Agent on the basis of the LIBOR Reserve Percentage in effect on,
and the applicable rates furnished to and received by the
Administrative Agent from the Reference Lenders two Business Days
before the first day of such Interest Period, subject, however,
to the last sentence contained in the definition of "LIBO Rate".
"LIBO Rate" means, relative to any Interest Period, the
rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at
which Dollar deposits in immediately available funds are offered
to each Reference Lender's LIBOR Office in the London interbank
market as at or about 11:00 a.m. (London time), two Business Days
prior to the beginning of such Interest Period for delivery on
the first day of such Interest Period, and in an amount
approximately equal to the amount of each such Reference Lender's
LIBO Rate Loan in the case of Revolving Loans, and, in the case
of Competitive Bid Loans based on a LIBOR Auction, determined as
if each Reference Lender were participating in such Competitive
Bid Loan in an amount equal to such Reference Lender's Percentage
of the principal amount of the Competitive Bid Loan being
requested, and for a period approximately equal to such Interest
Period. In furtherance of the foregoing, each Reference Lender
agrees to furnish to the Administrative Agent timely information
for the purpose of determining each LIBO Rate. If any one or
more of the Reference Lenders shall fail timely to furnish such
information to the Administrative Agent for any such interest
rate, the Administrative Agent shall determine such interest rate
on the basis of the information furnished by the remaining
Reference Lenders.
"LIBOR Reserve Percentage" means, relative to any Interest
Period for LIBO Rate Loans, the reserve percentage (expressed as
a decimal) equal to the average maximum reserve requirements of
the Lenders (without giving effect to the branch or agency in
which such Lender funds such Loans) (including all basic,
emergency, supplemental, marginal and other reserves and taking
into account any transitional adjustments or other scheduled
changes in reserve requirements) specified under regulations
issued from time to time by the F.R.S. Board and then applicable
to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D
of the F.R.S. Board, having a term approximately equal or
comparable to such Interest Period.
All LIBO Rate Loans and Competitive Bid Loans based on a
LIBOR Auction shall bear interest from and including the first
day of the applicable Interest Period to (but not including) the
last day of such Interest Period at the interest rate determined
as applicable to such LIBO Rate Loan or Competitive Bid Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any
principal amount of any Loan is due and payable (whether on the
Stated Maturity Date, upon acceleration or otherwise), or after
any other monetary Obligation of the Borrower shall have become
due and payable, the Borrower shall pay interest (after as well
as before judgment) on such amounts at a rate per annum equal to
the Alternate Base Rate plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each
Loan shall be payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) other than in the case of Base Rate Borrowings,
on the date of any payment or prepayment, in whole or in
part, of principal outstanding on such Loan on the amount
prepaid;
(c) with respect to Base Rate Loans, on each
Quarterly Payment Date occurring after the initial
Borrowing hereunder;
(d) with respect to Competitive Bid Loans based on an
Absolute Rate, on each Competitive Bid Loan Maturity Date
and, with respect to Competitive Bid Loans based on an
Absolute Rate with a Competitive Bid Loan Maturity Date in
excess of three months, on each Quarterly Payment Date
occurring after the making of such Loan;
(e) with respect to LIBO Rate Loans and Competitive
Bid Loans based on a LIBOR Auction, the last day of each
applicable Interest Period (and, if such Interest Period
shall exceed three months, on each three month anniversary
of such Interest Period);
(f) with respect to any Base Rate Loans converted
into LIBO Rate Loans on a day when interest would not
otherwise have been payable pursuant to clause (c), on the
date of such conversion; and
(g) on that portion of any Loans the Stated Maturity
Date of which is accelerated pursuant to Section 8.2 or
Section 8.3, immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising
under this Agreement or any other Loan Document after the date
such amount is due and payable (whether on the Stated Maturity
Date, upon acceleration or otherwise) shall be payable upon
demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees
set forth in this Section 3.3. All such fees shall be non-
refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay
to the Administrative Agent for the pro rata account of each
Lender, an ongoing commitment fee at the rate of 1/4 of 1% per
annum of the sum of the average daily unused portion of the Loan
Commitment Amount (such unused Loan Commitment Amount to be
computed without giving effect to any outstanding principal
amount of Competitive Bid Loans or Swing Line Loans), such fee to
accrue for the period commencing on the Effective Date until the
Loan Commitment Termination Date (including any period thereof
when any availability under the Commitment is suspended by reason
of the Borrower's inability to satisfy any condition of
Article V). Such commitment fees shall be payable by the
Borrower in arrears on each Quarterly Payment Date, commencing
with the first such day following the Effective Date, and on the
Commitment Termination Date.
SECTION 3.3.2. Agents' Fee. The Borrower agrees to pay to
the Administrative Agent, for the Administrative Agent's own
account, those fees, in the amounts and on the dates, set forth
in the Fee Letter.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender
shall determine (which determination, upon notice thereof to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Borrower), absent manifest error, shall be prima facie evidence
of the facts stated therein) that the introduction of or any
change in or in the interpretation of any law makes it unlawful,
or any central bank or other governmental authority asserts that
it is unlawful, for such Lender to make, continue or maintain any
Loan as, or to convert any Loan into, a LIBO Rate Loan, or to
make or maintain any Competitive Bid Loan based on a LIBOR
Auction, the obligations of such Lender to make, continue,
maintain or convert any such Loans shall, upon such
determination, forthwith be suspended until such Lender shall
notify the Administrative Agent that the circumstances causing
such suspension no longer exist (which notification such Lender
agrees to give as promptly as practicable when such circumstances
no longer exist), and all LIBO Rate Loans of such Lender shall
automatically convert into Base Rate Loans at the end of the then
current Interest Periods with respect thereto or sooner, if
required by such law or assertion. If any Lender shall make such
determination with respect to the making or maintaining a
Competitive Bid Loan based on a LIBOR Auction and such
Competitive Bid Loan is required by law or assertion to be
prepaid on a date prior to the end of the Interest Period
therefor, then the Borrower shall prepay such Competitive Bid
Loan on such date.
SECTION 4.2. Deposits Unavailable. If the Administrative
Agent shall have determined that
(a) Dollar deposits in the relevant amount and for
the relevant Interest Period are not available to the
Reference Lenders in their relevant market; or
(b) by reason of circumstances affecting the
Reference Lenders or the relevant market, adequate means do
not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans or Competitive Bid Loans based
on a LIBOR Auction,
then, upon notice from the Administrative Agent to the Borrower
and the Lenders, the obligations of all Lenders under Section
2.3.1 and Section 2.3.2 to make or continue any Loans as, or to
convert any Loans into, LIBO Rate Loans or the right of the
Borrower to solicit any Competitive Bid Loans based on a LIBOR
Auction shall forthwith be suspended until the Administrative
Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The
Borrower agrees to reimburse each Lender for any increase in the
cost to such Lender of, or any reduction in the amount of any sum
receivable by such Lender in respect of, making, continuing or
maintaining (or of its obligation to make, continue or maintain)
any Loans as, or of converting (or of its obligation to convert)
any Revolving Loans into, LIBO Rate Loans or Competitive Bid
Loans based on LIBOR Auctions. Such Lender shall promptly notify
the Administrative Agent in writing (which notice the
Administrative Agent agrees it will as promptly as practicable
forward to the Borrower) of the occurrence of any such event,
such notice to state, in reasonable detail, the reasons therefor
and the additional amount required fully to compensate such
Lender for such increased cost or reduced amount. Such
additional amounts shall be payable by the Borrower directly to
such Lender within five days of its receipt of such notice, and
such notice shall, in the absence of manifest error, be prima
facie evidence of the matters stated therein. If the Borrower is
requested to pay increased costs by any Lender (the "Affected
LIBO Lender") pursuant to this Section, the Borrower may, by
telephonic notice (promptly confirmed in writing) to the
Administrative Agent (which shall give prompt notice thereof to
the Affected LIBO Lender),
(a) as to any outstanding LIBO Rate Loans of such
Affected LIBO Lender, prepay such Loan in full, without
premium or penalty (other than as may be provided in
Section 4.4), but with such increased costs as well as any
accrued interest to the date of such prepayment on the
principal amount prepaid, without simultaneously making a
prepayment of the Loans of each other Lender and
simultaneously borrow a Base Rate Loan in an equal
principal amount (without the necessity that the conditions
set forth in Section 5.2 are met), and
(b) with respect to any Borrowing Request or
Continuation/Conversion Notice, request such Affected LIBO
Lender (i) to make the LIBO Rate Loan then or thereafter
subject to a Borrowing Request as a Base Rate Loan, or
(ii) to maintain the outstanding Base Rate Loan or LIBO
Rate Loan of such Lender then or thereafter the subject of
a Continuation/Conversion Notice as a Base Rate Loan.
SECTION 4.4. Funding Losses. In the event any Lender
shall incur any loss or expense (including any loss or expense
incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by such Lender to make, continue or
maintain any portion of the principal amount of any Loan as a
LIBO Rate Loan or a Competitive Bid Loan based on a LIBOR
Auction, or to convert any portion of the principal amount of any
Revolving Loan into, a LIBO Rate Loan) as a result of
(a) any repayment or prepayment of the principal
amount of any LIBO Rate Loans or Competitive Bid Loans
based on LIBOR Auctions or any conversion of a LIBO Rate
Loan on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Loans (i) not being made as, or (ii) being
made as Loans other than as, LIBO Rate Loans or Competitive
Bid Loans based on LIBOR Auctions, in each case, in
accordance with the Revolving Loan Borrowing Request or
Competitive Bid Loan Acceptance therefor, as the case may
be; or
(c) any Revolving Loans not being continued as, or
converted into, LIBO Rate Loans in accordance with the
Continuation/Conversion Notice therefor,
then, following the written notice of such Lender to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Borrower), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the
reasonable determination of such Lender) reimburse such Lender
for such loss or expense. Such written notice (which shall
include calculations in reasonable detail) shall, in the absence
of manifest error, be prima facie evidence of the matters stated
therein.
SECTION 4.5. Increased Capital Costs. If any change in,
or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority affects or would affect the amount of
capital required or expected to be maintained by any Lender or
any Person controlling such Lender, and such Lender determines
(in its sole and absolute discretion) that the rate of return on
its or such controlling Person's capital as a consequence of its
Commitment or the Loans made by such Lender is reduced to a level
below that which such Lender or such controlling Person could
have achieved but for the occurrence of any such circumstance,
then, in any such case upon notice from time to time by such
Lender to the Administrative Agent (which notice the
Administrative Agent agrees it will as promptly as practicable
forward to the Borrower), the Borrower shall promptly, and in any
event within five days of its receipt of such notice, pay
directly to such Lender additional amounts sufficient to
compensate such Lender or such controlling Person for such
reduction in rate of return. A statement of such Lender as to
any such additional amount or amounts (including calculations
thereof in reasonable detail) shall, in the absence of manifest
error, be prima facie evidence of the matters stated therein. In
determining such amount, such Lender may use any method of
averaging and attribution that it (in its sole and absolute
discretion) shall deem applicable.
SECTION 4.6. Taxes. All payments by the Borrower of
principal of, and interest on, the Loans and all other amounts
payable hereunder (including in respect of fees) shall be made
free and clear of and without deduction for any present or future
income, excise, stamp or franchise taxes and other taxes, fees,
duties, withholdings or other charges of any nature whatsoever
imposed by any taxing authority, but excluding franchise taxes
and taxes imposed on or measured by any Lender's net income or
receipts imposed by the jurisdiction of incorporation or
organization of such Lender or the jurisdiction where such Lender
has its Domestic Office or LIBOR Office (such non-excluded items
being called "Taxes"). In the event that any withholding or
deduction from any payment to be made by the Borrower hereunder
is required in respect of any Taxes pursuant to any applicable
law, rule or regulation, then the Borrower will
(a) pay directly to the relevant authority the full
amount required to be so withheld or deducted;
(b) promptly forward to the Administrative Agent an
official receipt or other documentation satisfactory to the
Administrative Agent evidencing such payment to such
authority; and
(c) pay to the Administrative Agent for the account
of the Lenders such additional amount or amounts as is
necessary to ensure that the net amount actually received
by each Lender will equal the full amount such Lender would
have received had no such withholding or deduction been
required.
Moreover, if the Administrative Agent or any Lender is obligated
to pay any Taxes with respect to any payment received by the
Administrative Agent or such Lender hereunder, the Administrative
Agent or such Lender may pay such Taxes and the Borrower will
promptly pay such additional amounts as is necessary in order
that the net amount received by such Person after the payment of
such Taxes (including any Taxes on such additional amount) shall
equal the amount such Person would have received had such Taxes
not been asserted.
If the Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the
Administrative Agent, for the account of the respective Lenders,
the required receipts or other required documentary evidence, the
Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a
result of any such failure. For purposes of this Section 4.6, a
distribution hereunder by the Administrative Agent or any Lender
to or for the account of any Lender shall be deemed a payment by
the Borrower.
Upon the request of the Borrower or the Administrative
Agent, each Lender that is organized under the laws of a
jurisdiction other than the United States or a State thereof
shall, prior to the due date of any payments under the Notes,
execute and deliver to the Borrower and the Administrative Agent,
on or about the first scheduled payment date in each Fiscal Year,
one or more (as the Borrower or the Administrative Agent may
reasonably request) United States Internal Revenue Service Forms
4224 or Forms 1001 or such other forms or documents (or successor
forms or documents), appropriately completed, as may be
applicable to establish the extent, if any, to which a payment to
such Lender is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless
otherwise expressly provided, all payments by the Borrower
pursuant to this Agreement, the Notes or any other Loan Document
shall be made by the Borrower to the Administrative Agent for the
pro rata account of the Lenders entitled to receive such payment.
All such payments required to be made to the Administrative Agent
shall be made, without setoff, deduction or counterclaim, not
later than 11:00 a.m. (New York City time), on the date due, in
immediately available funds, to such account as the
Administrative Agent shall specify from time to time by notice to
the Borrower. Funds received after that time shall be deemed to
have been received by the Administrative Agent on the next
succeeding Business Day. The Administrative Agent shall promptly
remit in same day funds to each Lender its share, if any, of such
payments received by the Administrative Agent for the account of
such Lender. All interest and fees shall be computed on the
basis of the actual number of days (including the first day but
excluding the last day) occurring during the period for which
such interest or fee is payable over a year comprised of 360 days
(or, in the case of interest on a Base Rate Loan, 365 days or, if
appropriate, 366 days). Whenever any payment to be made shall
otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (a)(i) of
the definition of the term "Interest Period" with respect to LIBO
Rate Loans and clause (a)(ii) of the definition of "Interest
Period" with respect to Competitive Bid Loans based on the LIBOR
Auction) be made on the next succeeding Business Day and such
extension of time shall be included in computing interest and
fees, if any, in connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall
obtain any payment or other recovery (whether voluntary,
involuntary, by application of setoff or otherwise) on account of
any Loan (other than pursuant to the terms of Sections 4.3, 4.4,
4.5, 4.6 and 10.3) in excess of its pro rata share of payments
then or therewith obtained by all Lenders, such Lender shall
purchase from the other Lenders such participations in Credit
Extensions made by them as shall be necessary to cause such
purchasing Lender to share the excess payment or other recovery
ratably with each of them; provided, however, that if all or any
portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase shall be
rescinded and each Lender which has sold a participation to the
purchasing Lender shall repay to the purchasing Lender the
purchase price to the ratable extent of such recovery together
with an amount equal to such selling Lender's ratable share
(according to the proportion of
(a) the amount of such selling Lender's required
repayment to the purchasing Lender
to
(b) the total amount so recovered from the purchasing
Lender)
of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights of payment (including
pursuant to Section 4.9) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower
in the amount of such participation. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives
a secured claim in lieu of a setoff to which this Section
applies, such Lender shall, to the extent practicable, exercise
its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders entitled under this
Section to share in the benefits of any recovery on such secured
claim.
SECTION 4.9. Setoff. Each Lender shall, upon the
occurrence of any Default described in clauses (a) through (d) of
Section 8.1.9 or, with the consent of the Required Lenders, upon
the occurrence of any other Event of Default, have the right to
appropriate and apply to the payment of the Obligations owing to
it (whether or not then due) any and all balances, credits,
deposits, accounts or moneys of the Borrower then or thereafter
maintained with such Lender; provided, however, that any such
appropriation and application shall be subject to the provisions
of Section 4.8. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such setoff and
application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such
setoff and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including
other rights of setoff under applicable law or otherwise) which
such Lender may have.
SECTION 4.10. Use of Proceeds. The Borrower shall apply
the proceeds of the Credit Extensions to refinance and repay in
full the Indebtedness described in Item 5.1.3 ("Indebtedness to
be Paid or Replaced") of the Disclosure Schedule and for the
general corporate purposes of the Borrower and its Subsidiaries;
without limiting the foregoing, no proceeds of any Loan will be
used in violation of F.R.S. Board Regulation U.
SECTION 4.11. Replacement of Lenders. Each Lender hereby
severally agrees that if such Lender (a "Subject Lender") makes a
demand upon the Borrower for (or if the Borrower is otherwise
required to pay) amounts pursuant to Section 4.3, Section 4.5 or
Section 4.6, the Borrower may, within 90 days of receipt by the
Borrower of such demand (or the occurrence of such other event
causing the Borrower to be required to pay such compensation)
give notice (a "Replacement Notice") in writing to the
Administrative Agent and such Lender of its intention to replace
such Lender with a financial institution designated in such
Replacement Notice. If the Administrative Agent shall, in the
exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice, notify the Borrower and such
Subject Lender in writing that the designated financial
institution is satisfactory to the Administrative Agent, then
such Lender shall, so long as no Default shall have occurred and
be continuing, assign, in accordance with Section 10.11.1, all of
its Commitments, Loans, Notes and other rights and obligations
under this Agreement and all other Loan Documents to such
designated financial institution; provided, however, that (i)
such assignment shall be without recourse, representation or
warranty and shall be on terms and conditions reasonably
satisfactory to such Lender and such designated financial
institution and (ii) the purchase price paid by such designated
financial institution shall be in the amount of such Lender's
Loans, together with all accrued and unpaid interest and fees in
respect thereof, plus all other amounts (including the amounts
demanded and unreimbursed under Section 4.3, 4.5 or 4.6, as the
case may be), owing to the Subject Lender hereunder. Upon the
effective date of such Assignment, the Borrower shall issue a
replacement Note or Notes, as the case may be, to such designated
financial institution and such institution shall become a
"Lender" for all purposes under this Agreement and the other Loan
Documents. The Administrative Agent agrees to use all
commercially reasonable efforts to assist the Borrower in
locating a replacement financial institution to replace any
Subject Lender; provided, however, that the Borrower agrees to
pay all reasonable costs and expenses (and the fee payable to the
Administrative Agent pursuant to Section 10.11.1) incurred by the
Administrative Agent in providing such assistance.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of
the Lenders to fund the initial Borrowing on and after the
Effective Date shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in
this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Administrative Agent
shall have received from the Borrower a certificate, dated the
date of the initial Credit Extension, of its Secretary or
Assistant Secretary as to
(a) resolutions of its Board of Directors then in
full force and effect authorizing the execution, delivery
and performance of this Agreement, the Notes and each other
Loan Document to be executed by it;
(b) true and complete copies of the Borrower's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement,
the Notes and each other Loan Document executed by it,
upon which certificate each Lender may conclusively rely until it
shall have received a further certificate of the Secretary of the
Borrower canceling or amending such prior certificate.
SECTION 5.1.2. Delivery of Notes. The Administrative
Agent shall have received, for the account of each Lender, such
Lender's Revolving Notes and its Competitive Bid Loan Notes duly
executed and delivered by the Borrower. In addition, the
Administrative Agent shall have received the Swing Line Note duly
executed and delivered by the Borrower.
SECTION 5.1.3. Payment of Outstanding Indebtedness, etc.
All Indebtedness identified in Item 5.1.3 ("Indebtedness to be
Paid or Replaced") of the Disclosure Schedule, together with all
interest, all prepayment premiums and other amounts due and
payable with respect thereto, shall have been paid in full
(including, to the extent necessary, from proceeds of the initial
Credit Extension) and all commitments thereunder shall have been
terminated, and evidence thereof shall have been delivered to the
Administrative Agent; and all Liens (if any) securing payment of
any such Indebtedness have been released and the Administrative
Agent shall have received all Uniform Commercial Code Form UCC-3
termination statements or other instruments as may be suitable or
appropriate in connection therewith.
SECTION 5.1.4. Opinions of Counsel. The Administrative
Agent shall have received opinions, dated the date of the initial
Credit Extension and addressed to the Administrative Agent, the
Co-Agents and all Lenders, from
(a) Paul E. Dixon, Vice President and General Counsel
of the Borrower, substantially in the form of Exhibit H
hereto (and the Borrower hereby expressly instructs such
counsel to deliver such opinion to the Administrative Agent
and the Lenders); and
(b) Mayer, Brown & Platt, counsel to the
Administrative Agent, substantially in the form of
Exhibit I hereto (and the Administrative Agent hereby
expressly instructs such counsel to deliver such opinion to
the Lenders).
SECTION 5.1.5. Closing Fees, Expenses, etc. The
Administrative Agent shall have received for its own account, or
for the account of each Lender, as the case may be, all fees,
costs and expenses due and payable pursuant to Sections 3.3 and
10.3, if then invoiced.
SECTION 5.1.6. Termination of Existing Agreement. The
Administrative Agent shall have received a termination letter in
form and substance satisfactory to it executed and delivered by
the Borrower to the effect that the Existing Agreement has been
terminated and that the Lenders (under and as defined in the
Existing Agreement) have no further obligations under the
Existing Agreement.
SECTION 5.2. All Credit Extensions. The obligation of
each Lender to fund any Loan on the occasion of any Borrowing
(including the initial Credit Extension) shall be subject to the
satisfaction of each of the conditions precedent set forth in
this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default,
etc. Both before and after giving effect to any Credit Extension
(but, if any Default of the nature referred to in Section 8.1.5
shall have occurred with respect to any other Indebtedness,
without giving effect to any application, directly or indirectly,
of the proceeds thereof to cure such Default) the following
statements shall be true and correct
(a) the representations and warranties set forth in
Article VI (excluding, however, those contained in Section
6.7 for any Credit Extension occurring after the initial
Borrowing hereunder) shall be true and correct in all
material respects with the same effect as if then made
(unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be
true and correct as of such earlier date);
(b) except as disclosed by the Borrower to the
Administrative Agent and the Lenders pursuant to
Section 6.7
(i) no litigation, arbitration or governmental
investigation or proceeding shall be pending or, to
the knowledge of the Borrower, threatened against the
Borrower or any of its Subsidiaries which may
reasonably be expected to materially adversely affect
the Borrower's, or the Borrower and its Subsidiaries'
taken as a whole, businesses, operations, assets,
revenues, properties or prospects or which purports to
affect the legality, validity or enforceability of
this Agreement, the Notes or any other Loan Document;
and
(ii) no development shall have occurred in any
litigation, arbitration or governmental investigation
or proceeding disclosed pursuant to Section 6.7 which
may reasonably be expected to materially adversely
affect the businesses, operations, assets, revenues,
properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole;
(c) the aggregate outstanding principal amount of all
Loans does not exceed the Loan Commitment Amount; and
(d) no Default shall have then occurred and be
continuing, and neither the Borrower nor any of its
Subsidiaries are in material violation of any law or
governmental regulation or court order or decree the
violation of which would have a material adverse effect on
businesses, operations, assets, revenues, properties or
prospects of the Borrower or the Borrower and its
Subsidiaries, taken as a whole.
SECTION 5.2.2. Borrowing Request. The Administrative
Agent shall have received a Borrowing Request. The delivery of a
Borrowing Request and the acceptance by the Borrower of the
proceeds or the receipt of the benefit of such Credit Extension
shall constitute a representation and warranty by the Borrower
that on the date of such Credit Extension (both immediately
before and after giving effect to such Credit Extension and the
application of the proceeds thereof) the statements made in
Section 5.2.1 are true and correct.
SECTION 5.2.3. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto by or on behalf of the
Borrower or any of its Subsidiaries in connection with such
Credit Extension shall be satisfactory in form and substance to
the Administrative Agent and its counsel; the Administrative
Agent and its counsel shall have received all information,
approvals, opinions, documents or instruments as the
Administrative Agent or its counsel may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders, the Co-Agents and the
Administrative Agent to enter into this Agreement and to make
Credit Extensions hereunder, the Borrower represents and warrants
to each such party as set forth in this Article VI.
SECTION 6.1. Organization, etc. The Borrower and each of
its Subsidiaries is a corporation or partnership validly
organized and existing and in good standing under the laws of the
State of its incorporation or organization, is duly qualified to
do business and is in good standing as a foreign corporation or
partnership in each jurisdiction where the nature of its business
requires it to be so qualified except where such failure would
not, singly or in the aggregate, have a material adverse effect
on the Borrower's or the Borrower and its Subsidiaries', taken as
a whole, financial condition, operations, assets, businesses,
properties or prospects, and has full power and authority and
holds all requisite governmental licenses, permits and other
approvals to (i) enter into and perform its Obligations under
this Agreement, the Notes and each other Loan Document and
(ii) to own and hold under lease its property and to conduct its
business substantially as currently conducted by it, except for
the failure to hold such licenses, permits or other approvals
which such failure would not, singly or in the aggregate, have a
material adverse effect on the financial condition, operations,
assets, businesses, properties or prospects of the Borrower or
the Borrower and its Subsidiaries taken as a whole.
SECTION 6.2. Due Authorization, Non-Contravention, etc.
The execution, delivery and performance by the Borrower of this
Agreement, the Notes and each other Loan Document executed or to
be executed by it, are within the Borrower's corporate powers,
have been duly authorized by all necessary corporate action, and
do not
(a) contravene the Borrower's Organic Documents;
(b) contravene any contractual restriction, law or
governmental regulation or court decree or order binding on
or affecting the Borrower; or
(c) result in, or require the creation or imposition
of, any Lien on any of the Borrower's properties.
SECTION 6.3. Government Approval, Regulation, etc. No
authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or
other Person is required for the due execution, delivery or
performance by the Borrower of this Agreement, the Notes or any
other Loan Document. Neither the Borrower nor any of its
Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 6.4. Validity, etc. This Agreement constitutes,
and the Notes and each other Loan Document executed by the
Borrower will, on the due execution and delivery thereof,
constitute, the legal, valid and binding obligations of the
Borrower enforceable in accordance with their respective terms,
except that the enforceability thereof may be subject to
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and the effect
of general principles of equity.
SECTION 6.5. Financial Information. The balance sheets of
the Borrower and each of its Subsidiaries as at December 31,
1993, March 31, 1994 and June 30, 1994 and the related statements
of earnings and cash flow of the Borrower and each of its
Subsidiaries, copies of which have been furnished to the
Administrative Agent and each Lender, have been prepared in
accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the corporations covered
thereby as at the dates thereof and the results of their
operations for the periods then ended.
SECTION 6.6. No Material Adverse Change. Since the date
of the latest financial statements described in Section 6.5,
there has been no material adverse change in the financial
condition, operations, assets, business, properties or prospects
of the Borrower or its Subsidiaries.
SECTION 6.7. Litigation, etc. There is no pending or, to
the knowledge of the Borrower, threatened litigation, action or
proceeding affecting the Borrower or any of its Subsidiaries, or
any of their respective properties, businesses, assets or
revenues, which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
business, properties or prospects of the Borrower, or the
Borrower and its Subsidiaries, taken as a whole, or which
purports to affect the legality, validity or enforceability of
this Agreement, the Notes or any other Loan Document, except as
disclosed in Item 6.7 ("Litigation") of the Disclosure Schedule.
SECTION 6.8. Subsidiaries. The Borrower has no
Subsidiaries, except those Subsidiaries
(a) which are identified in Item 6.8 ("Existing
Subsidiaries") of the Disclosure Schedule; or
(b) which are permitted to have been acquired or
created in accordance with Section 7.2.5 or 7.2.10.
SECTION 6.9. Ownership of Properties. The Borrower and
each of its Subsidiaries owns good and marketable title to all of
its real properties and good title to all its personal property
and other assets, tangible and intangible, of any nature
whatsoever (including patents, trademarks, trade names, service
marks and copyrights), free and clear of all Liens, charges or
claims (including infringement claims with respect to patents,
trademarks, copyrights and the like) except as permitted pursuant
to Section 7.2.3 or disclosed pursuant to Section 6.7.
SECTION 6.10. Taxes. The Borrower and each of its
Subsidiaries has filed all tax returns and reports required by
law to have been filed by it and has paid all taxes and
governmental charges thereby shown to be owing, except any such
taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP shall have been set aside on its books.
SECTION 6.11. Pension and Welfare Plans. During the
twelve-consecutive-month period prior to the date of the
execution and delivery of this Agreement and prior to the date of
any Credit Extension hereunder, no steps have been taken to
terminate any Pension Plan, and no contribution failure has
occurred with respect to any Pension Plan sufficient to give rise
to a Lien under section 302(f) of ERISA. No condition exists or
event or transaction has occurred with respect to any Pension
Plan which might result in the incurrence by the Borrower or any
member of the Controlled Group of any material liability, fine or
penalty. Except as disclosed in Item 6.11 ("Employee Benefit
Plans") of the Disclosure Schedule, neither the Borrower nor any
member of the Controlled Group has any contingent liability with
respect to any post-retirement benefit under a Welfare Plan,
other than liability for continuation coverage described in Part
6 of Title I of ERISA.
SECTION 6.12. Environmental Warranties. To the best
knowledge of the Borrower, after all reasonable inquiry:
(a) all facilities and property (including underlying
groundwater) owned or leased by the Borrower or any of its
Subsidiaries have been, and continue to be, owned or leased
by the Borrower or the Borrower and its Subsidiaries in
material compliance with all Environmental Laws except for
such noncompliance, that singly or in the aggregate, does
not have or may not reasonably be expected to have a
materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(b) there have been no past, and there are no pending
or threatened
(i) claims, complaints, notices or requests for
information received by the Borrower or any of its
Subsidiaries with respect to any alleged violation of
any Environmental Law, or
(ii) complaints, notices or inquiries to the
Borrower or any of its Subsidiaries regarding
potential liability under any Environmental Law,
that, singly or in the aggregate, have, or may reasonably
be expected to have, a materially adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(c) there have been no Releases of Hazardous
Materials at, on or under any property now owned or leased
or, to the knowledge of the Borrower, previously owned or
leased, by the Borrower or any of its Subsidiaries that,
singly or in the aggregate, have, or may reasonably be
expected to have, a material adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(d) the Borrower and its Subsidiaries have been
issued and are in material compliance with all permits,
certificates, approvals, licenses and other authorizations
relating to environmental matters and necessary for their
businesses except such permits, certificates, approvals,
licenses and authorizations the absence of which will not,
singly or in the aggregate, have or may reasonably be
expected to have, a materially adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(e) neither the Borrower nor any Subsidiary of the
Borrower has received any notification that any property
now or previously owned or leased by the Borrower or any of
its Subsidiaries is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS
or on any similar state list of sites requiring
investigation or clean-up except for (i) as disclosed in
Item 6.12 ("Environmental Warranties") of the Disclosure
Schedule and (ii) such properties as disclosed by the
Borrower to the Lenders pursuant to clause (b)(i)(B)(I) of
Section 7.1.6 and for which the Borrower's or such
Subsidiaries' liability in respect thereof is not singly or
in the aggregate reasonably expected to have a material
adverse effect on the financial condition, operations,
assets, businesses, operations or prospects of the Borrower
or the Borrower and its Subsidiaries, taken as a whole;
(f) there is no liability related to offsite
transport, treatment or disposal of Hazardous Material
generated or handled by the Borrower or any of its
Subsidiaries except for such liability that singly, or in
the aggregate, which may not reasonably be expected to have
a materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(g) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under
any property now or, to the knowledge of the Borrower,
previously, owned or leased by the Borrower or any of its
Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a material adverse effect
on the financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole;
(h) neither the Borrower nor any Subsidiary of the
Borrower has directly transported or directly arranged for
the transportation of any Hazardous Material to any
location which is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS
or on any similar state list or which is the subject of
federal, state or local enforcement actions or other
investigations which may lead to material claims against
the Borrower or such Subsidiary thereof for any remedial
work, damage to natural resources or personal injury,
including claims under CERCLA which claims, singly or in
the aggregate, may reasonably be expected to have a
material adverse effect on the financial condition,
operations, assets, businesses, properties, or prospects or
the Borrower or the Borrower and its Subsidiaries, taken as
a whole;
(i) there are no polychlorinated biphenyls or friable
asbestos present at any property now or previously, owned
or leased by the Borrower or any Subsidiary of the Borrower
that, singly or in the aggregate, have, or may reasonably
be expected to have, a material adverse effect on the
financial condition, operations, assets, business,
properties or prospects of the Borrower or the Borrower and
its Subsidiaries, taken as a whole; and
(j) other than as stated above, no conditions exist
at, on or under any property now or previously, owned or
leased by the Borrower which, with the passage of time, or
the giving of notice or both, would give rise to liability
under any Environmental Law that, singly or in the
aggregate, have or may reasonably be expected to have a
materially adverse effect on the financial condition,
operations, assets, business, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole.
SECTION 6.13. Regulations G, U and X. Neither the
Borrower nor any Subsidiary is engaged in the business of
extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loan will be used for a purpose
which violates, or would be inconsistent with, F.R.S. Board
Regulation G, U or X. Terms for which meanings are provided in
F.R.S. Board Regulation G, U or X or any regulations substituted
therefor, as from time to time in effect, are used in this
Section with such meanings.
SECTION 6.14. Accuracy of Information. All factual
information heretofore or contemporaneously furnished by or on
behalf of the Borrower in writing to any Agent or any Lender for
purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all other such factual
information hereafter furnished by or on behalf of the Borrower
to any Agent, or any Lender will be, true and accurate in every
material respect on the date as of which such information is
dated or certified and, if heretofore delivered, as of the date
of execution and delivery of this Agreement by the Administrative
Agent, any Co-Agent and such Lender, and such information is not,
or shall not be, as the case may be, incomplete by omitting to
state any material fact necessary to make such information not
misleading.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees
with the Co-Agents, the Administrative Agent and each Lender
that, until all Commitments have terminated and all Obligations
have been paid and performed in full, the Borrower will perform
the obligations set forth in this Section 7.1.
SECTION 7.1.1. Financial Information, Reports, Notices,
etc. The Borrower will furnish, or will cause to be furnished,
to each Lender and the Administrative Agent copies of the
following financial statements, reports, notices and information:
(a) as soon as available and in any event within
45 days after the end of each of the first three Fiscal
Quarters of each Fiscal Year of the Borrower, consolidated
balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Quarter and consolidated statements
of earnings and cash flow of the Borrower and its
Subsidiaries for such Fiscal Quarter and for the period
commencing at the end of the previous Fiscal Year and
ending with the end of such Fiscal Quarter, certified by
the chief financial Authorized Officer of the Borrower;
(b) as soon as available and in any event within
90 days after the end of each Fiscal Year of the Borrower,
a copy of the annual audit report for such Fiscal Year for
the Borrower and its Subsidiaries, including therein
consolidated balance sheets of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and
consolidated statements of earnings and cash flow of the
Borrower and its Subsidiaries for such Fiscal Year, in each
case certified (without any Impermissible Qualification) in
a manner acceptable to the Administrative Agent and the
Required Lenders by KMPG Peat Marwick or other independent
public accountants reasonably acceptable to the
Administrative Agent and the Required Lenders, together
with a certificate from such accountants containing a
computation of, and showing compliance with, each of the
financial ratios and restrictions contained in
Section 7.2.4;
(c) as soon as available and in any event within
45 days after the end of each Fiscal Quarter, a completed
Compliance Certificate, which shall also include a
statement as to (i) the total market value of precious
metal held on consignment by the Borrower and its
Subsidiaries, (ii) the total number of ounces of precious
metal held on consignment at each Plant (as defined in the
Consignment Facilities) under the terms of the Consignment
Facilities, and (iii) the total number of ounces of U.S.
Bullion (as defined in the Consignment Facilities) located
at each Plant;
(d) as soon as possible and in any event within five
days after the occurrence of each Default, a statement of
the chief financial Authorized Officer setting forth
details of such Default and the action which the Borrower
has taken and proposes to take with respect thereto;
(e) as soon as possible and in any event within three
days after (x) the occurrence of any material adverse
development with respect to any litigation, action or
proceeding described in Section 6.7 or (y) the commencement
of any litigation, action or proceeding of the type
described in Section 6.7, notice thereof and copies of all
documentation relating thereto;
(f) promptly after the sending or filing thereof,
copies of all reports which the Borrower sends to any of
its security holders, and all reports and registration
statements without exhibits incorporated by reference
therein which the Borrower or any of its Subsidiaries files
with the Securities and Exchange Commission or any national
securities exchange;
(g) immediately upon becoming aware of the
institution of any steps by the Borrower or any other
Person to terminate any Pension Plan, or the failure to
make a required contribution to any Pension Plan if such
failure is sufficient to give rise to a Lien under section
302(f) of ERISA, or the taking of any action with respect
to a Pension Plan which could result in the requirement
that the Borrower furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event
with respect to any Pension Plan which could result in the
incurrence by the Borrower of any material liability, fine
or penalty, or any material increase in the contingent
liability of the Borrower with respect to any post-
retirement Welfare Plan benefit, notice thereof and copies
of all documentation relating thereto; and
(h) such other information respecting the condition
or operations, financial or otherwise, of the Borrower or
any of its Subsidiaries as any Lender through the
Administrative Agent may from time to time reasonably
request.
SECTION 7.1.2. Compliance with Laws, etc. The Borrower
will, and will cause each of its Subsidiaries to, comply in all
material respects with all applicable laws, rules, regulations
and orders, such compliance to include (without limitation):
(a) the maintenance and preservation of its corporate
existence and qualification as a foreign corporation except
where the failure to so qualify would not have a material
adverse effect on the financial condition, operations,
assets, business, properties or prospects of the Borrower
or the Borrower and its Subsidiaries, taken as a whole, as
the case may be; and
(b) the payment, before the same become delinquent,
of all taxes, assessments and governmental charges imposed
upon it or upon its property except to the extent being
diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 7.1.3. Maintenance of Properties. The Borrower
will, and will cause each of its Subsidiaries to, maintain,
preserve, protect and keep those of its properties in good
repair, working order and condition, and make necessary useful or
necessary and proper repairs, renewals and replacements so that
its business carried on in connection therewith may be properly
conducted at all times unless the Borrower determines in good
faith that the continued maintenance of any of its properties is
no longer economically desirable.
SECTION 7.1.4. Insurance. The Borrower will, and will
cause each of its Subsidiaries to, maintain or cause to be
maintained with responsible insurance companies insurance with
respect to its properties and business against such casualties
and contingencies and of such types and in such amounts as is
customary in the case of similar businesses and will, upon
request of the Administrative Agent, furnish to each Lender at
reasonable intervals a certificate of an Authorized Officer
setting forth the nature and extent of all insurance maintained
by the Borrower and its Subsidiaries in accordance with this
Section.
SECTION 7.1.5. Books and Records. The Borrower will, and
will cause each of its Subsidiaries to, keep books and records
which accurately reflect all of its business affairs and
transactions and permit the Administrative Agent and each Lender
or any of their respective representatives, at reasonable times
and intervals, to visit all of its offices, to discuss its
financial matters with its officers and independent public
accountant (and the Borrower hereby authorizes such independent
public accountant to discuss the Borrower's financial matters
with each Lender or its representatives whether or not any
representative of the Borrower is present) and to examine any of
its books or other corporate records. The Borrower shall pay any
fees of such independent public accountant incurred in connection
with the Administrative Agent's (on behalf of the Lender's)
exercise of its rights pursuant to this Section; provided, that
after the occurrence and during the continuation of a Default,
the expenses of a Lender (other than the Administrative Agent)
exercising its rights pursuant to this Section shall be for the
account of the Borrower. In addition, following the delivery of
any notification required pursuant to clause (b)(i) of Section
7.1.6, the Borrower agrees to permit the Administrative Agent to
discuss with the relevant authorities the status and formation of
plans in respect of such claims, complaints, notices or
inquiries, and to attend any meeting or otherwise be present at
conferences with management of the Borrower and consult with
their outside environmental consultants and engineers (and the
Borrower hereby authorizes such environmental consultants and
engineers to discuss such environmental matters with the
Administrative Agent or its representatives whether or not any
representative of the Borrower is present) in connection
therewith, all at the Borrower's expense.
SECTION 7.1.6. Environmental Covenant. The Borrower will,
and will cause each of its Subsidiaries to,
(a) use and operate all of its facilities and
properties in material compliance with all Environmental
Laws, keep all necessary permits, approvals, certificates,
licenses and other authorizations relating to environmental
matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws;
(b) (i) immediately notify the Administrative Agent
(A) and provide copies upon receipt of all material written
claims, complaints, notices or inquiries relating to the
environmental condition of its facilities and properties or
non-compliance with Environmental Laws which could singly
or in the aggregate reasonably be expected to have a
material adverse effect on the financial condition,
operations, assets, businesses, properties or prospects of
the Borrower or the Borrower and its Subsidiaries, taken as
a whole and (B) (I) of the listing or proposal for listing
of any property owned or leased by the Borrower or any of
its Subsidiaries on the National Priorities List pursuant
to CERCLA, on the CERCLIS or on any similar state list of
sites requiring investigation or cleanup and (II) upon its
determination by the Borrower or its Subsidiary, as the
case may be, of the estimate of the amount of the liability
of the Borrower or such Subsidiary with respect to any such
property, and, (ii) shall either diligently contest or
pursue settlement of, in good faith and by appropriate
proceedings, or promptly undertake to correct such
condition or non-compliance and have dismissed any such
actions and proceedings relating to compliance with
Environmental Laws; and
(c) provide such information and certifications which
the Administrative Agent may reasonably request from time
to time to evidence compliance with this Section 7.1.6.
SECTION 7.2. Negative Covenants. The Borrower agrees with
the Co-Agents, the Administrative Agent and each Lender that,
until all Commitments have terminated and all Obligations have
been paid and performed in full, the Borrower will perform the
obligations set forth in this Section 7.2.
SECTION 7.2.1. Business Activities. The Borrower will
not, and will not permit any of its Subsidiaries to, engage in
any business activity which is substantially different from those
described in the first recital and such activities as may be
incidental or related thereto.
SECTION 7.2.2. Designated Debt, Letters of Credit;
Subsidiary Debt. (a) The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to
exist or otherwise become or be liable in respect of any
Designated Debt or Indebtedness in respect of letters of credit
(whether or not drawn), other than
(i) in the case of Designated Debt, to the extent that
the aggregate amount of Designated Debt does not exceed the
sum of:
(A) 90% of the Market Value of the gold, silver
and platinum group metals and the gold, silver and
platinum group metals' content of alloys then owned by
the Borrower and its Subsidiaries in inventory and not
held under consignment;
plus
(B) 75% of Eligible Receivables of the Borrower
and its Subsidiaries;
plus
(C) 100% of the cash and Cash Equivalent
Investments of the Borrower and its Subsidiaries, but
only to the extent that such cash and Cash Equivalent
Investments are not subject to any Lien and (if held
or owned by a Subsidiary) are transferable to the
Borrower without the consent or approval of any other
Person; and
(ii) in the case of Indebtedness in respect of
letters of credit (whether or not drawn)
(A) the Letters of Credit (as such term is
defined in the Long Term Credit Agreement); and
(B) Indebtedness in respect of other letters of
credit in an aggregate face amount not to exceed 10%
of Adjusted Consolidated Tangible Net Worth.
(b) Notwithstanding clause (a) above or clause (b) of
Section 7.2.4, no Subsidiary of the Borrower shall create, incur,
assume or suffer to exist or otherwise become or be liable in
respect of any Debt except:
(i) Debt existing on the Effective Date and described
in Item 7.2.2(b) ("Existing Subsidiary Debt") of the
Disclosure Schedule; and
(ii) Debt which in the aggregate for all such
Subsidiaries does not exceed 10% of Adjusted Consolidated
Tangible Net Worth.
SECTION 7.2.3. Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or
suffer to exist any Lien upon any of its property, revenues or
assets (including any capital stock of the Borrower's
Subsidiaries), whether now owned or hereafter acquired, except:
(a) Liens securing Indebtedness of a Subsidiary to
the Borrower;
(b) Liens granted prior to the Effective Date to
secure payment of Indebtedness identified in Item 7.2.3(b)
("Ongoing Indebtedness") and 7.2.2 (b) ("Existing
Subsidiary Debt") of the Disclosure Schedule;
(c) Liens for taxes, assessments or other
governmental charges or levies not at the time delinquent
or thereafter payable without penalty or being diligently
contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have
been set aside on its books;
(d) Liens of carriers, warehousemen, mechanics,
materialmen and landlords incurred in the ordinary course
of business for sums not overdue or being diligently
contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have
been set aside on its books;
(e) Liens incurred in the ordinary course of business
in connection with workmen's compensation, unemployment
insurance or other forms of governmental insurance or
benefits, or to secure performance of tenders, statutory
obligations, leases and contracts (other than for borrowed
money) entered into in the ordinary course of business or
to secure obligations on surety or appeal bonds;
(f) judgment Liens in existence less than 15 days
after the entry thereof or with respect to which execution
has been stayed or the payment of which is covered in full
(subject to a customary deductible) by insurance maintained
with responsible insurance companies;
(g) easements, rights-of-way, zoning and similar
restrictions and other similar charges or encumbrances not
interfering with the ordinary conduct of the business of
the Borrower or any of its Subsidiaries and which do not
impair materially the use thereof by the Borrower or any of
its Subsidiaries;
(h) Liens existing on the property of Subsidiaries on
the date such Subsidiary is acquired which Lien was not
incurred in connection with or in contemplation of the
acquisition of such Subsidiary;
(i) Liens on assets acquired by the Borrower or any
Subsidiary existing at the time of acquisition of such
asset which Liens are not created in connection with or in
contemplation of such acquisition and which do not attach
to any other assets of the Borrower or such Subsidiary, as
the case may be;
(j) Liens on properties the underlying amount secured
thereby of which do not in the aggregate at any one time
exceed 20% of Adjusted Consolidated Tangible Net Worth less
the amount secured by Liens of properties so encumbered by
Liens permitted under clauses (b), (h) and (i) above, and
clause (l) below;
(k) leases or subleases granted to other Persons not
materially interfering with the conduct of the business of
the Borrower or any Subsidiary;
(l) renewals and extensions of any of the foregoing
so long as the Indebtedness secured thereby does not
increase; and
(m) Liens granted in connection with the consignment
of precious metal to be located at the Plants (as defined
in the Consignment Facilities) under the terms of the
Consignment Facilities and related documents executed in
connection therewith.
SECTION 7.2.4. Financial Condition. The Borrower will not
permit:
(a) its Adjusted Consolidated Tangible Net Worth as
at the last day of any Fiscal Quarter during any period set
forth below to be less than the amount set forth opposite
such period:
Adjusted Consolidated
Period Tangible Net Worth
07/01/94 through 09/30/94 $128,000,000
10/01/94 through 12/31/94 130,000,000
01/01/95 and thereafter 130,000,000 plus 25%
of the Borrower's
Net Income for the
immediately
preceding Fiscal
Year;
(b) its Leverage Ratio as of the last day of any
Fiscal Quarter to be greater than 1.70:1.00; or
(c) the Interest Coverage Ratio as at the last day of
any Fiscal Quarter during any period set forth below to be
less than the ratio set forth opposite such period:
Interest
Period Coverage Ratio
07/01/94 through 09/30/94 1.90:1.00
10/01/94 through 12/31/94 2.00:1.00
01/01/95 through 03/31/95 2.10:1.00
04/01/95 through 06/30/95 2.20:1.00
07/01/95 and each Fiscal
Quarter thereafter 2.25:1.00.
SECTION 7.2.5. Investments. The Borrower will not, and
will not permit any of its Subsidiaries to, make, incur, assume
or suffer to exist any Investment in any other Person, except:
(a) Investments existing on the Effective Date and
identified in Item 7.2.5(a) ("Ongoing Investments") of the
Disclosure Schedule;
(b) Cash Equivalent Investments;
(c) without duplication, all Investments made or
committed to be made as Capital Expenditures;
(d) in the ordinary course of business, Investments
by the Borrower in any of its Subsidiaries existing as of
the date of this Agreement, or by any such Subsidiary in
any of its Subsidiaries existing as of the date of this
Agreement, by way of contributions to capital or loans or
advances;
(e) Investments taken in satisfaction of
Indebtedness, provided, that the aggregate amount of such
Investments shall not exceed $1,000,000 in any Fiscal Year
of the Borrower;
(f) Investments in other Persons engaged in business
activities which are substantially the same as those
described in the first recital and such activities as may
be incidental or related thereto, provided that upon making
such Investment such Person becomes a Subsidiary of the
Borrower and such Investment is made solely with cash or
the issuance of the Borrower's capital stock (or a
combination thereof); and
(g) other Investments in an aggregate amount at the
time of determination not to exceed 5% of Adjusted
Consolidated Tangible Net Worth;
provided, however, that
(h) any Investment which when made complies with the
requirements of the definition of the term "Cash Equivalent
Investment" may continue to be held notwithstanding that
such Investment if made thereafter would not comply with
such requirements; and
(i) no Investment otherwise permitted by clause (d),
(e), (f) or (g) shall be permitted to be made if,
immediately before or after giving effect thereto, any
Default shall have occurred and be continuing.
SECTION 7.2.6. Restricted Payments, etc. On and at all
times after the Effective Date:
(a) the Borrower will not declare, pay or make any
dividend or distribution (in cash, property or obligations)
on any shares of any class of capital stock (now or
hereafter outstanding) of the Borrower or on any warrants,
options or other rights with respect to any shares of any
class of capital stock (now or hereafter outstanding) of
the Borrower (other than dividends or distributions payable
in its common stock or warrants to purchase its common
stock or splitups or reclassifications of its stock into
additional or other shares of its common stock and other
than ordinary cash dividends made on a quarterly basis in
respect of the outstanding common stock of the Borrower,
but only to the extent that both before and after giving
effect to the payment of such dividends, no Event of
Default shall have occurred and be continuing) or apply, or
permit any of its Subsidiaries to apply, any of its funds,
property or assets to the purchase, redemption, sinking
fund or other retirement of, or agree or permit any of its
Subsidiaries to purchase or redeem, any shares of any class
of capital stock (now or hereafter outstanding) of the
Borrower, or warrants, options or other rights with respect
to any shares of any class of capital stock (now or
hereafter outstanding) of the Borrower; provided that the
Borrower may purchase shares of its capital stock so long
as before and after giving effect to such purchase no
Default has occurred and is continuing or is created
thereby; and
(b) the Borrower will not, and will not permit any
Subsidiary to, make any deposit for any of the foregoing
purposes, except to the extent any such cash dividend on
the Borrower's common stock is permitted in accordance with
clause (a) of this Section.
SECTION 7.2.7. Transactions with Affiliates. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into, or cause, suffer or permit to exist any arrangement or
contract with any of its other Affiliates (other than the
Borrower or any of its Subsidiaries) unless such arrangement or
contract is fair and equitable to the Borrower or such Subsidiary
and is an arrangement or contract of the kind which would be
entered into by a prudent Person in the position of the Borrower
or such Subsidiary with a Person which is not one of its
Affiliates.
SECTION 7.2.8. Long Term Rental Obligations. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into at any time any arrangement (other than the Consignment
Facilities) exceeding three years in duration which does not
create a Capitalized Lease Liability and which involves the
leasing by the Borrower or any of its Subsidiaries from any
lessor of any real or personal property (or any interest
therein), except arrangements which, together with all other such
arrangements which shall then be in effect, will not require the
payment of an aggregate amount of rentals by the Borrower and its
Subsidiaries in excess of an amount equal to (excluding
escalations resulting from a rise in the consumer price or
similar index) 5% of Adjusted Consolidated Tangible Net Worth
measured at the time of the incurrence of such obligation;
provided, however, that any calculation made for purposes of this
Section shall exclude any amounts required to be expended for
maintenance and repairs, insurance, taxes, assessments, and other
similar charges.
SECTION 7.2.9. Take or Pay Contracts. The Borrower will
not, and will not permit any of its Subsidiaries to, enter into
or be a party to any arrangement for the purchase of materials,
supplies, other property or services if such arrangement by its
express terms requires that payment be made by the Borrower or
such Subsidiary regardless of whether such materials, supplies,
other property or services are delivered or furnished to it.
SECTION 7.2.10. Consolidation, Merger, etc. The Borrower
will not, and will not permit any of its Subsidiaries to,
liquidate or dissolve, consolidate with, or merge into or with,
any other corporation, or purchase or otherwise acquire all or
substantially all of the assets of any Person (or of any division
thereof) except
(a) any such Subsidiary may liquidate or dissolve
voluntarily into, and may merge with and into, the Borrower
or any other Subsidiary, and the assets or stock of any
Subsidiary may be purchased or otherwise acquired by the
Borrower or any other Subsidiary;
(b) the Borrower may merge or consolidate with any
other corporation, provided that (i) the Borrower shall be
the continuing or surviving corporation, or, if the
Borrower is not the surviving corporation, then the
successor corporation shall be a solvent corporation
organized under the laws of any State of the United States
of America and shall expressly assume in a writing
satisfactory in form and substance to the Required Lenders,
all of the obligations of the Borrower under this Agreement
and under the Notes, including all covenants herein and
therein contained, and such successor corporation shall
succeed to and be substituted for the Borrower with the
same effect as if it had been a party hereto, (ii) after
giving effect to such merger or consolidation the Borrower
as the continuing or surviving corporation or the successor
corporation could incur an additional $1.00 of Designated
Debt under clause (a)(i) of Section 7.2.2, (iii) no Default
shall have occurred and be continuing and, after giving
effect to such merger or consolidation, no Default would
occur and be continuing and (iv) after giving effect to
such merger or consolidation, at least 75% of the gold,
silver and platinum group metals and the gold, silver and
platinum group metals' content of alloys then held by the
Borrower in inventory (and not under consignment), taken at
their Market Value, and at least 75% of the book value of
all of the other assets of the Borrower, shall be located
within the United States;
(c) so long as no Default has occurred and is
continuing or would occur after giving effect thereto, the
Borrower or any of its Subsidiaries may purchase all or
substantially all of the assets of any Person, or acquire
such Person by merger, if made as a Capital Expenditure or
by Investment if permitted (without duplication) by Section
7.2.5.
SECTION 7.2.11. Asset Dispositions, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, sell,
transfer, lease, contribute or otherwise convey, or grant
options, warrants or other rights with respect to, any of its
assets (including accounts receivable and capital stock of
Subsidiaries) to any Person, unless
(a) such sale, transfer, lease, contribution or
conveyance is in the ordinary course of its business or is
permitted by Section 7.2.10;
(b) the assets subject to such sale, transfer, lease,
contribution or conveyance are identified as discontinued
operations or otherwise identified as assets to be disposed
in the Borrower's Current Report on Form 8-K, dated
June 27, 1991;
(c) if such sale, transfer, lease, contribution or
conveyance is not in the ordinary course of business and
not otherwise permitted hereunder, the assets are sold for
fair value (as determined by the Board of Directors of the
Borrower or the Subsidiary owning such assets) and the
commitments of the lenders under the Long Term Credit
Agreement are reduced by an amount equal to the Net
Disposition Proceeds (as defined in the Long Term Credit
Agreement) of such sale, transfer, lease, contribution or
conveyance; or
(d) the aggregate book value or market value, if
higher (determined as to particular assets as of the
respective date of disposition thereof) (other than in
accordance with clauses (a), (b) and (c) above) of all
assets sold, transferred, leased, contributed or otherwise
conveyed by the Borrower and its Subsidiaries (i) since the
Effective Date, does not exceed 10% of the consolidated
assets of the Borrower as of the Effective Date, and
(ii) does not constitute assets which contributed more than
10% of operating profit contribution during any of the
three most recently completed Fiscal Years of the Borrower.
SECTION 7.2.12. Restrictive Agreements, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, enter
into any agreement (excluding this Agreement, any other Loan
Document, the Long Term Credit Agreement, the Consignment
Facilities and any agreement governing any Indebtedness in
existence on the Effective Date as in effect on the Effective
Date) prohibiting
(a) the ability of the Borrower to amend or otherwise
modify this Agreement or any other Loan Document; or
(b) the ability of any Subsidiary to make any
payments, directly or indirectly, to the Borrower by way of
dividends, advances, repayments of loans or advances,
reimbursements of management and other intercompany
charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which
restricts the ability of any such Subsidiary to make any
payment, directly or indirectly, to the Borrower.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 8.1
shall constitute an "Event of Default".
SECTION 8.1.1. Non-Payment of Obligations. (a) The
Borrower shall default in the payment or prepayment when due of
any principal of any Loan; or (b) the Borrower shall default (and
such default shall continue unremedied for a period of three
Business Days) in the payment when due of any interest on any
Loan or fee or of any other Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or
warranty of the Borrower made or deemed to be made hereunder or
in any other Loan Document or any other writing or certificate
furnished by or on behalf of the Borrower to the Administrative
Agent or any Lender for the purposes of or in connection with
this Agreement or any such other Loan Document (including any
certificates delivered pursuant to Article V) is or shall be
incorrect when made or deemed made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and
Obligations. The Borrower shall default in the due performance
and observance of any of its obligations under Section 7.2 or
Section 7.1.6.
SECTION 8.1.4. Non-Performance of Other Covenants and
Obligations. The Borrower shall default in the due performance
and observance of any other agreement contained herein or in any
other Loan Document (other than as set forth in Section 8.1.1 or
8.1.3), and such default shall continue unremedied for a period
of 10 Business Days after notice thereof shall have been given to
the Borrower by the Administrative Agent or any Lender.
SECTION 8.1.5. Default on Other Indebtedness or
Agreements. A default shall occur in the payment when due
(subject to any applicable grace period), whether by acceleration
or otherwise, of any Indebtedness (other than Indebtedness
described in Section 8.1.1) of the Borrower or any of its
Subsidiaries having a principal amount, individually or in the
aggregate, in excess of $1,000,000, or a default shall occur in
the performance or observance of any obligation or condition with
respect to such Indebtedness if the effect of such default is to
accelerate the maturity of any such Indebtedness or such default
shall continue unremedied for any applicable period of time
sufficient to permit the holder or holders of such Indebtedness,
or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed
maturity or any Event of Default (as defined in any of the
Consignment Facilities or the Revolving Credit Agreement) shall
have occurred and be continuing under any of the Consignment
Facilities or the Revolving Credit Agreement, respectively.
SECTION 8.1.6. Judgments. Any judgment or order for the
payment of money in excess of $1,000,000 (excluding that portion
of a judgment covered by insurance as to which such insurance
carrier has acknowledged liability) shall be rendered against the
Borrower or any of its Subsidiaries or Affiliates (including
joint ventures) and either
(a) enforcement proceedings shall have been commenced
by any creditor upon such judgment or order; or
(b) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall
not be in effect.
SECTION 8.1.7. Pension Plans. Any of the following events
shall occur with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any
member of its Controlled Group or any other Person to
terminate a Pension Plan if, as a result of such
termination, the Borrower or any such member could be
required to make a contribution to such Pension Plan, or
could reasonably expect to incur a liability or obligation
to such Pension Plan, in excess of $1,000,000; or
(b) a contribution failure occurs with respect to any
Pension Plan sufficient to give rise to a Lien under
Section 302(f) of ERISA.
SECTION 8.1.8. Control of the Borrower. Any Change in
Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower
or any of its Subsidiaries (including joint ventures) shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Borrower or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of
a trustee, receiver, sequestrator or other custodian for
the Borrower or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall
not be discharged within 60 days, provided that the
Borrower, each Subsidiary and each joint venture hereby
expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any relevant
proceeding during such 60-day period to preserve, protect
and defend their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or
any dissolution, winding up or liquidation proceeding, in
respect of the Borrower or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Borrower or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in
by the Borrower or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed, provided that the Borrower,
each Subsidiary and each such joint venture hereby
expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any such case or
proceeding during such 60-day period to preserve, protect
and defend their rights under the Loan Documents; or
(e) take any action authorizing, or in furtherance
of, any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Borrower, the value of whose assets in
the aggregate for the Fiscal Quarter most recently ended
accounted for an amount equal to or less than 5% of Adjusted
Consolidated Tangible Net Worth.
SECTION 8.2. Action if Bankruptcy. If any Event of
Default described in clauses (a) through (d) of Section 8.1.9
shall occur, the Commitments of each Lender (if not theretofore
terminated) shall automatically terminate, the Stated Maturity
Date shall automatically be accelerated and the outstanding
principal amount of all outstanding Loans and all other
Obligations shall automatically be and become immediately due and
payable, without notice or demand.
SECTION 8.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 8.1.9) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders,
shall by notice to the Borrower declare the Stated Maturity Date
to be accelerated and/or direct the Administrative Agent to
declare all or any portion of the outstanding principal amount of
the Loans and other Obligations to be due and payable and/or the
Commitments of each Lender (if not theretofore terminated) to be
terminated, whereupon the Stated Maturity Date shall be
accelerated, the full unpaid amount of such Loans and other
Obligations which shall be so declared due and payable shall be
and become immediately due and payable, without further notice,
demand or presentment, and/or, as the case may be, the
Commitments shall terminate.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints each of
Scotiabank, and Chemical as its Co-Agent, and Scotiabank as its
Administrative Agent, under and for purposes of this Agreement,
the Notes and each other Loan Document. Each Lender authorizes
Scotiabank, in its capacity as the Administrative Agent, to act
on behalf of such Lender under this Agreement, the Notes and each
other Loan Document in such capacity and, in the absence of other
written instructions from the Required Lenders received from time
to time by the Administrative Agent (with respect to which the
Administrative Agent agrees that it will comply, except as
otherwise provided in this Section or as otherwise advised by
counsel), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent
by the terms hereof and thereof, together with such powers as may
be reasonably incidental thereto. Each Lender hereby indemnifies
(which indemnity shall survive any termination of this Agreement)
the Administrative Agent, pro rata according to such Lender's
Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever to the extent not otherwise paid by the
Borrower which may at any time be imposed on, incurred by, or
asserted against, the Administrative Agent in any way relating to
or arising out of this Agreement, the Notes and any other Loan
Document, including reasonable attorneys' fees, and as to which
the Administrative Agent is required to be, but is not reimbursed
by the Borrower; provided, however, that no Lender shall be
liable for the payment of any portion of such liabilities,
obligations, losses, damages, claims, costs or expenses which are
determined to have resulted solely from the Administrative
Agent's gross negligence or wilful misconduct. The
Administrative Agent shall not be required to take any action
hereunder, under the Notes or under any other Loan Document
except such actions expressly provided for hereunder, or to
prosecute or defend any suit in respect of this Agreement, the
Notes or any other Loan Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the
Administrative Agent shall be or become, in the Administrative
Agent's determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to
do the acts indemnified against hereunder until such additional
indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the
Administrative Agent shall have been notified by telephone,
confirmed in writing, by any Lender by 5:00 p.m. (New York City
time), on the day prior to a Borrowing of other than Base Rate
Loans that are to be made on the same date requested by the
Borrower that such Lender will not make available the amount
which would constitute its Percentage of such Borrowing in the
case of Revolving Loans, or the amount of its Competitive Bid
Loan Offer that has been accepted by the Borrower pursuant to
clause (e)(ii) of Section 2.4, in the case of Competitive Bid
Loans, in each case on the date specified therefor, the
Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the Borrower a
corresponding amount. In the case of a Borrowing of Base Rate
Loans that are to be made on the same date requested by the
Borrower, the Administrative Agent may assume that each Lender
will make available to the Administrative Agent the amount which
would constitute its Percentage of such Borrowing in the case of
Revolving Loans, or the amount of its Competitive Bid Loan Offer
that has been accepted by the Borrower pursuant to clause (e)(ii)
of Section 2.4, in the case of Competitive Bid Loans, and, in
reliance upon such assumption, make available to the Borrower a
corresponding amount. If and to the extent that such Lender
shall not have made such amount available to the Administrative
Agent, such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand, without duplication,
such corresponding amount together with interest thereon, for
each day from the date the Administrative Agent made such amount
available to the Borrower to the date such amount is repaid to
the Administrative Agent, in the case of the Borrower, at the
interest rate applicable at the time to Loans comprising such
Borrowing, and in the case of such Lender, for the period from
the date such funds were advanced to the Borrower to (and
including) three days thereafter, at the rate customarily charged
for inter-bank loans in the U.S., and following such third day,
at the interest rate applicable at the time to Loans comprising
such Borrowing.
SECTION 9.3. Exculpation. Neither the Administrative
Agent nor any of its directors, officers, employees or agents
shall be liable to any Lender for any action taken or omitted to
be taken by it under this Agreement or any other Loan Document,
or in connection herewith or therewith, except for its own wilful
misconduct or gross negligence, nor responsible for any recitals
or warranties herein or therein, nor for the effectiveness, or,
other than with respect to the Administrative Agent,
enforceability, validity or due execution of this Agreement or
any other Loan Document (as it relates to the Administrative
Agent), nor to make any inquiry respecting the performance by the
Borrower of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by the
Administrative Agent shall not obligate it to make any further
inquiry or to take any action. The Administrative Agent shall be
entitled to rely upon advice of counsel concerning legal matters
and upon any notice, consent, certificate, statement or writing
which the Administrative Agent believes to be genuine and to have
been presented by a proper Person.
SECTION 9.4. Successor. The Administrative Agent may
resign as such at any time upon at least 30 days' prior notice to
the Borrower and all Lenders. If the Administrative Agent at any
time shall resign, the Required Lenders may, with the written
consent of the Borrower so long as no Default has occurred and is
continuing (which consent shall not be unreasonably withheld),
appoint another Lender as a successor Administrative Agent, which
shall thereupon (subject to its consent) become the
Administrative Agent hereunder. If no successor Administrative
Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, which shall
(subject to its consent) be one of the Lenders or a commercial
banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking
institution, and having a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to
receive from the retiring Administrative Agent such documents of
transfer and assignment as such successor Administrative Agent
may reasonably request, and shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's
resignation hereunder as the Administrative Agent, the provisions
of
(a) this Article IX shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was
the Administrative Agent under this Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to
inure to its benefit.
SECTION 9.5. Credit Extensions by an Agent. Each Agent
shall have the same rights and powers with respect to (x) the
Loans made by it or any of its respective Affiliates, and (y) the
Notes held by it or any of its respective Affiliates as any other
Lender and may exercise the same as if it were not an Agent.
Each Agent and its respective Affiliates may accept deposits
from, lend money to, and generally engage in any kind of business
with the Borrower or any Subsidiary or Affiliate of the Borrower
as if such Agent, as the case may be, were not an Agent
hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges
that it has, independently of the Administrative Agent, each Co-
Agent and each other Lender, and based on such Lender's review of
the financial information of the Borrower, this Agreement, the
other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents,
information and investigations as such Lender has deemed
appropriate, made its own credit decision to extend its
Commitment. Each Lender also acknowledges that it will,
independently of the Administrative Agent and each other Lender,
and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its
own credit decisions as to exercising or not exercising from time
to time any rights and privileges available to it under this
Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall
give prompt notice to each Lender of each notice or request
required or permitted to be given to the Administrative Agent by
the Borrower pursuant to the terms of this Agreement (unless
concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document
or instrument received for its account and copies of all other
communications received by the Administrative Agent from the
Borrower for distribution to the Lenders by the Administrative
Agent in accordance with the terms of this Agreement.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Loan Document may from time to
time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to by the
Borrower and the Required Lenders; provided, however, that no
such amendment, modification or waiver which would:
(a) modify any requirement hereunder that any
particular action be taken by all the Lenders or by the
Required Lenders shall be effective unless consented to by
each Lender;
(b) modify this Section 10.1, change the definition
of "Required Lenders", increase the Commitment Amount or
the Percentage of any Lender, or extend the Loan Commitment
Termination Date shall be made without the consent of each
Lender and each holder of a Note;
(c) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of
principal of or interest on or fees in respect of any Loan
or any other amounts payable to a Lender hereunder (or
reduce the principal amount of or rate of interest on any
Loan) shall be made without the consent of the holder of
that Note evidencing such Loan; or
(d) affect adversely the interests, rights or
obligations of an Agent qua such Agent shall be made
without consent of the Agent.
No failure or delay on the part of any Agent, any Lender or the
holder of any Note in exercising any power or right under this
Agreement or any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such
power or right preclude any other or further exercise thereof or
the exercise of any other power or right. No notice to or demand
on the Borrower in any case shall entitle it to any notice or
demand in similar or other circumstances. No waiver or approval
by any Agent, any Lender or the holder of any Note under this
Agreement or any other Loan Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.
SECTION 10.2. Notices. All notices and other
communications provided to any party hereto under this Agreement
or any other Loan Document shall be in writing or by facsimile
and addressed, delivered or transmitted to such party at its
address or facsimile number set forth below its signature hereto
or set forth in the Lender Assignment Agreement or at such other
address or facsimile number as may be designated by such party in
a notice to the other parties. Any notice, if mailed and
properly addressed with postage prepaid or if properly addressed
and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be
deemed given when transmitted upon receipt of electronic
confirmation of transmission.
SECTION 10.3. Payment of Costs and Expenses. The Borrower
agrees to pay on demand all reasonable out-of-pocket expenses of
the Administrative Agent, (including the reasonable fees and out-
of-pocket expenses of a single counsel to the Administrative
Agent and of local counsel, if any, who may be retained by
counsel to the Administrative Agent in connection with
(a) the negotiation, preparation, execution and
delivery of this Agreement and of each other Loan Document,
including schedules and exhibits, and any amendments, (the
costs and expenses associated with the formation of the
syndicate of Lenders) waivers, consents, supplements or
other modifications to this Agreement or any other Loan
Document as may from time to time hereafter be required,
whether or not the transactions contemplated hereby are
consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Loan Document; and
(c) the administration and monitoring of this
Agreement and the Loan Documents, and compliance of the
parties hereto with respect to the terms hereof.
The Borrower further agrees to pay, and to save the Agents and
the Lenders harmless from all liability for, any stamp or other
taxes which may be payable in connection with the execution or
delivery of this Agreement, the Borrowings hereunder, or the
issuance of the Notes or any other Loan Documents. The Borrower
also agrees to reimburse each Agent and each Lender upon demand
for all reasonable out-of-pocket expenses (including reasonable
attorneys' fees and legal expenses (including those fees and
legal expenses of internal counsel to such Lender allocated to
this Agreement)) incurred by such Agent or such Lender in
connection with (x) the negotiation of any restructuring or
"work-out", whether or not consummated, of any Obligations and
(y) the enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the
execution and delivery of this Agreement by the Issuer and each
Lender and the extension of the Commitments, the Borrower hereby
indemnifies, exonerates and holds each Agent and each Lender and
each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") free and
harmless from and against any and all actions, causes of action,
suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any
such Indemnified Party is a party to the action for which
indemnification hereunder is sought), including reasonable
attorneys' fees and disbursements (collectively, the "Indemnified
Liabilities"), incurred by the Indemnified Parties or any of them
as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds
of any Loan;
(b) the entering into and performance of this
Agreement and any other Loan Document by any of the
Indemnified Parties (including any action brought by or on
behalf of the Borrower as the result of any determination
by the Required Lenders pursuant to Article V not to make a
Credit Extension due to the failure of the Borrower to meet
the conditions for such Credit Extension);
(c) any investigation, litigation or proceeding
involving the Borrower or any of its Subsidiaries or
property now or previously owned or leased by the Borrower
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Borrower or any of its
Subsidiaries or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material; provided, that the
Indemnified Party shall have given the Borrower notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(d) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Borrower or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Borrower or such
Subsidiary; or
(e) any breach of warranty contained in Section 6.12,
without giving effect to the exceptions based upon the
materially adverse effect and any qualification based on
materiality or knowledge;
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of the
relevant Indemnified Party's gross negligence or wilful
misconduct. If and to the extent that the foregoing undertaking
may be unenforceable for any reason, the Borrower hereby agrees
to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under
applicable law.
SECTION 10.5. Survival. The obligations of the Borrower
under Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the
obligations of the Lenders under Section 9.1, shall in each case
survive any termination of this Agreement, the payment in full of
all Obligations and the termination of all Commitments. The
representations and warranties made by the Borrower in this
Agreement and in each other Loan Document shall survive the
execution and delivery of this Agreement and each such other Loan
Document.
SECTION 10.6. Severability. Any provision of this
Agreement or any other Loan Document which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Loan Document or
affecting the validity or enforceability of such provision in any
other jurisdiction.
SECTION 10.7. Headings. The various headings of this
Agreement and of each other Loan Document are inserted for
convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness,
etc. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be executed by the
Borrower and the Administrative Agent and be deemed to be an
original and all of which shall constitute together but one and
the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower, each
Agent and each Lender (or notice thereof satisfactory to the
Administrative Agent) shall have been received by the
Administrative Agent and notice thereof shall have been given by
the Administrative Agent to the Borrower and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS
AGREEMENT, THE NOTES AND EACH OTHER LOAN DOCUMENT SHALL EACH BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. This Agreement, the Notes and the
other Loan Documents constitute the entire understanding among
the parties hereto with respect to the subject matter hereof and
supersede any prior agreements, written or oral, with respect
thereto.
SECTION 10.10. Successors and Assigns. This Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns;
provided, however, that:
(a) the Borrower may not assign or transfer its
rights or obligations hereunder without the prior written
consent of all Lenders; and
(b) the rights of sale, assignment and transfer of
the Lenders are subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans and Note;
Participations in Loans and Note. Each Lender may assign, or
sell participations in, its Loans and Commitment to one or more
other Persons in accordance with this Section 10.11.
SECTION 10.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower and
Scotiabank (so long as Scotiabank is a Lender) (which
consents shall not be unreasonably delayed or withheld and
which consent, in the case of the Borrower, shall be deemed
to have been given in the absence of a written notice
delivered by the Borrower to the Administrative Agent, on
or before the fifth Business Day after receipt by the
Borrower of such Lender's request for consent, stating, in
reasonable detail, the reasons why the Borrower proposes to
withhold such consent (provided, that the failure to
deliver such consent shall not be a "Default" for purposes
of satisfying the conditions to Credit Extensions set forth
in clause (d) of Section 5.2.1)) may at any time assign and
delegate to one or more commercial banks or other financial
institutions;
(b) with notice to the Borrower and the
Administrative Agent, but without the consent of any
Person, may (i) assign and delegate to any other Lender,
and (ii) assign and/or delegate to any of its Affiliates or
Subsidiaries; and
(c) with notice to the Administrative Agent, but
without the consent of any Person, may pledge its Loans
(and related rights thereto) to a Federal Reserve Bank in
support of borrowings made by such Lender from such Federal
Reserve Bank;
(each Person described in the foregoing clauses as being the
Person to whom such assignment and delegation is to be made,
being hereinafter referred to as an "Assignee Lender"), all or
any fraction of such Lender's total Loans and Commitment (which
assignment and delegation shall be of a constant, and not a
varying, percentage of all the assigning Lender's Loans and
Commitment) in a minimum aggregate amount, when taken together
with other assignments being made to such Assignee Lender under
the Dollar Supply Agreement and Short-Term Dollar Supply
Agreement (as referred to in the definition of the Consignment
Facilities) and under the Long Term Agreement, of $10,000,000 in
the case of an assignment described in clause (a) (such amount to
be reduced pro rata by any permanent reductions in the amount of
the Commitment), or if less, all of such Lender's Loans and
Commitment; provided, however, that any such Lender will (i)
except in connection with a pledge of Loans pursuant to clause
(c) above, contemporaneously sell a pro rata portion of its (A)
Advances and Advance Commitment (as such terms are defined in the
Short-Term Dollar Supply Agreement and Dollar Supply Agreement
referred to in the definition of Consignment Facilities) and (B)
its Loans and Commitment (as such terms are defined in the
Revolving Credit Agreement), in each case to the same Assignee
Lender pursuant to the terms of such agreement and provided
further that any such Assignee Lender will comply, if applicable,
with the provisions contained in the last sentence of Section 4.6
and further, provided, however, that, the Borrower and the
Administrative Agent shall be entitled to continue to deal solely
and directly with such Lender in connection with the interests so
assigned and delegated to an Assignee Lender until
(d) written notice of such assignment and delegation,
together with payment instructions, addresses and related
information with respect to such Assignee Lender, shall
have been given to the Borrower and the Administrative
Agent by such Lender and such Assignee Lender;
(e) such Assignee Lender shall have executed and
delivered to the Borrower and the Administrative Agent a
Lender Assignment Agreement, accepted by the Administrative
Agent; and
(f) the processing fees described below shall have
been paid.
From and after the date that the Administrative Agent accepts
such Lender Assignment Agreement, (x) the Assignee Lender
thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder
have been assigned and delegated to such Assignee Lender in
connection with such Lender Assignment Agreement, shall have the
rights and obligations of a Lender hereunder and under the other
Loan Documents, and (y) the assignor Lender, to the extent that
rights and obligations hereunder have been assigned and delegated
by it in connection with such Lender Assignment Agreement, shall
be released from its obligations hereunder and under the other
Loan Documents. Within five Business Days after its receipt of
notice that the Administrative Agent has received an executed
Lender Assignment Agreement, the Borrower shall execute and
deliver to the Administrative Agent (for delivery to the relevant
Assignee Lender) a new Note evidencing such Assignee Lender's
assigned Loans and Commitment and, if the assignor Lender has
retained Loans and a Commitment hereunder, a replacement Note in
the principal amount of the Loans and Commitment retained by the
assignor Lender hereunder (such Note to be in exchange for, but
not in payment of, that Note then held by such assignor Lender).
Each such Note shall be dated the date of the predecessor Note.
The assignor Lender shall mark the predecessor Note "exchanged"
and deliver it to the Borrower. Accrued interest on that part of
the predecessor Note evidenced by the new Note, and accrued fees,
shall be paid as provided in the Lender Assignment Agreement.
Accrued interest on that part of the predecessor Note evidenced
by the replacement Note shall be paid to the assignor Lender.
Accrued interest and accrued fees shall be paid at the same time
or times provided in the predecessor Note and in this Agreement.
Such assignor Lender or such Assignee Lender must also pay
(without duplication of any processing fees payable pursuant to
Section 10.11.1 of the Revolving Credit Agreement, Section 8.11.1
of the Dollar Supply Agreement and Section 8.11.1 of the Short-
Term Dollar Supply Agreement (as referred to in the definition of
Consignment Facilities)) a processing fee to the Administrative
Agent upon delivery of any Lender Assignment Agreement in the
amount of $2,500 (provided, however, that such processing fee
shall not be required to be paid by a Lender in the case of
(i) an assignment and/or delegation of such Lender's Loans and
Commitments to an Affiliate or Subsidiary of such Lender, or
(ii) to a Federal Reserve Bank pursuant to clause (c) of this
Section. Any attempted assignment and delegation not made in
accordance with this Section 10.11.1 shall be null and void.
SECTION 10.11.2. Participations. Any Lender may at any
time sell to one or more commercial banks or other Persons (each
of such commercial banks and other Persons being herein called a
"Participant") participating interests in any of the Loans, its
Commitment, or other interests of such Lender hereunder;
provided, however, that
(a) no participation contemplated in this
Section 10.11.2 shall relieve such Lender from its
Commitment or its other obligations hereunder or under any
other Loan Document;
(b) such Lender shall remain solely responsible for
the performance of its Commitment and such other
obligations;
(c) the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under
this Agreement and each of the other Loan Documents;
(d) no Participant, unless such Participant is an
Affiliate of such Lender, or is itself a Lender, shall be
entitled to require such Lender to take or refrain from
taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any
Participant that such Lender will not, without such
Participant's consent, take any actions of the type
described in clause (b) or (c) of Section 10.1; and
(e) the Borrower shall not be required to pay any
amount hereunder that is greater than the amount which it
would have been required to pay had no participating
interest been sold.
The Borrower acknowledges and agrees that each Participant, for
purposes of Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 10.3 and 10.4,
shall be considered a Lender.
SECTION 10.12. Other Transactions. Nothing contained
herein shall preclude any Agent or any other Lender from engaging
in any transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of
its Affiliates in which the Borrower or such Affiliate is not
restricted hereby from engaging with any other Person.
SECTION 10.13. Forum Selection and Consent to
Jurisdiction. ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF EACH AGENT, THE LENDERS
OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN
THE COURTS OF THE CITY AND STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK;
PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE
BORROWER HEREBY EXPRESSLY AND IRREVOCABLY, FOR ITSELF AND ITS
PROPERTY, SUBMITS TO THE EXTENT PERMITTED BY APPLICABLE LAW TO
THE JURISDICTION OF THE COURTS OF THE CITY AND STATE OF NEW YORK
AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH SUCH LITIGATION. THE BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF NEW YORK. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING
OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE
BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
SECTION 10.14. Waiver of Jury Trial. EACH AGENT, THE
LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH AGENT, THE LENDERS
OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT
HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT
IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR
EACH AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT AND EACH
SUCH OTHER LOAN DOCUMENT.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Name: Stephen B. Mudd
Title: Vice President and Treasurer
Address: 250 Park Avenue
New York, New York 10177
Facsimile No.: 212-309-0682
Attention: Mr. Stephen B. Mudd
Vice President and Treasurer
THE BANK OF NOVA SCOTIA,
in its capacity as
Administrative Agent, Co-Agent and
the Issuer
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NOVA SCOTIA, in its capacity
as a Lender
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Domestic
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
LIBOR
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NEW YORK, in its capacity as
a Co-Agent and a Lender
By: /s/ William A. Kerr
Name: William A. Kerr
Title: Vice President
Domestic
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
LIBOR
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
PERCENTAGE
8.641975300% CHEMICAL BANK, in its capacity as
a Co-Agent and a Lender
By: /s/ Theodore L. Parker
Name: Theodore L. Parker
Title: Vice President
Domestic
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
LIBOR
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
PERCENTAGE
7.514761100% FLEET BANK, N.A.
By: /s/ John V. Raleigh
Name: John V. Raleigh
Title: Vice President
Domestic
Office: One Stamford Plaza
263 Tresser Blvd.
Stamford, Connecticut 06901
Facsimile No.: 203-351-1511
Attention: Virginia Rockwood
LIBOR
Office: One Stamford Plaza
263 Tresser Blvd.
Stamford, Connecticut 06901
Facsimile No.: 203-351-1511
Attention: Virginia Rockwood
PERCENTAGE
7.514761100% NBD BANK, N.A.
By: /s/ Anna R. Hoffman
Name: Anna R. Hoffman
Title: Vice President
Domestic
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
LIBOR
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
PERCENTAGE
6.441223800% THE BANK OF TOKYO TRUST COMPANY
By: /s/ Jeffrey Miller
Name: Jeffrey Miller
Title:
Domestic
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
LIBOR
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
PERCENTAGE
6.441223800% LTCB TRUST COMPANY
By: /s/ Rene LeBlanc
Name: Rene LeBlanc
Title: Senior Vice President
Domestic
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
LIBOR
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
PERCENTAGE
6.441223800% SHAWMUT BANK, N.A.
By: /s/ Kerry Day
Name: Kerry Day
Title: Assistant Vice President
Domestic
Office: One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
LIBOR
Office: Shawmut Bank, N.A.
One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
PERCENTAGE
4.294149200% CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Vice President
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Authorized Signature
In both cases:
Domestic
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
LIBOR
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
For Credit Matters:
Attention: Andrea Griffis
PERCENTAGE
4.294149200% THE DAIWA BANK, LIMITED
By: /s/ J.H. Broadley
Name: J.H. Broadley
Title: Vice President
By: /s/ B.W. Henry
Name: B.W. Henry
Title: Vice President and Manager
Domestic
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
LIBOR
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
Address for
Notices: The Daiwa Bank, Limited
450 Lexinton Avenue
Suite 1700
New York, New York 10017
Facsimile No.: 212-818-0866
Attention: Catherine Tiano, Credit
Administration Assistant
PERCENTAGE
4.294149200% DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ Jeffrey N. Wieser
Name: Jeffrey N. Wieser
Title: Director
By: /s/ Jean M. Hannigan
Name: Jean M. Hannigan
Title: Assistant Vice President
Domestic
Office: Deutsche Bank AG,
New York and/or
Cayman Islands Branches
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
LIBOR
Office: Deutsche Bank AG,
Cayman Islands Branch
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
PERCENTAGE
4.294149200% THE FUJI BANK LTD.
By: /s/ Gina M. Kearns
Name: Gina M. Kearns
Title: Vice President and Manager
Domestic
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
LIBOR
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
PERCENTAGE
4.294149200% NATIONAL WESTMINSTER BANK USA
By: /s/ Phillip H. Sorace
Name: Phillip H. Sorace
Title: Vice President
Domestic
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
LIBOR
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
PERCENTAGE
3.220611900% ABN AMRO BANK N.V. NEW YORK BRANCH
By: /s/ Richard H. West
Name: Richard H. West
Title: Group Vice President
By: /s/ Rodolfo Barros
Name: Rodolfo Barros
Title: Vice President
Domestic
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
LIBOR
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
PERCENTAGE
3.220611900% BANQUE PARIBAS
By: /s/ Richard G. Burrows
Name: Richard G. Burrows
Title: Vice President
By: /s/ Ann Pifer
Name: Ann Pifer
Title: Assistant Vice President
Domestic
Office: 787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
LIBOR
Office: Banque Paribas
787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
PERCENTAGE
3.220611900% GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By: /s/ D. Stephens / /s/ John Redding
Name: Dhuane G. Stephens/John P. Redding
Title: Vice President / Vice President
Domestic
Office: 65 East 55th Street
New York, New York 10022
Facsimile No: 212-644-0644
Attention: Dhuane Stephens
LIBOR
Office: 65 East 55th Street
New York, New York 10022
Facsimile No.: 212-421-2719
Attention: Orlando Diaz
PERCENTAGE
2.147074700% COMERICA BANK
By: /s/ Julie Burke Smith
Name: Julie Burke Smith
Title: Vice President
Domestic
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
LIBOR
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
PERCENTAGE
2.147074700% IBJ SCHRODER BANK & TRUST COMPANY
By: /s/ J. Christopher Mangan
Name: J. Christopher Mangan
Title: Vice President
Domestic
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
LIBOR
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
PERCENTAGE
2.147074700% THE MITSUBISHI BANK, LIMITED -
NEW YORK BRANCH
By: /s/ Paula Mueller
Name: Paula Mueller
Title: Vice President
Domestic
Office: 225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
LIBOR
Office: The Mitsubishi Bank, Limited
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
PERCENTAGE
2.147074700% YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By: /s/ Nicholas Pullen
Name: Nicholas Pullen
Title: Vice President
Domestic
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
LIBOR
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
SCHEDULE I
DISCLOSURE SCHEDULE
ITEM 1. Existing Letters of Credit.
Stated Amount Beneficiary
ITEM 5.1.3 Indebtedness to be Paid or Replaced.
Creditor Outstanding Principal Amount
ITEM 6.7 Litigation.
Description of Proceeding Action or Claim Sought
ITEM 6.8 Existing Subsidiaries.
State of Ownership Business
Name Incorporation % Description
ITEM 6.11 Employee Benefit Plans.
ITEM 6.12 Environmental Matters.
ITEM 7.2.3(b) Ongoing Indebtedness.
Creditor Outstanding Principal Amount
ITEM 7.2.5.(a) Ongoing Investments.
EXHIBIT 10.5
EXECUTION COPY
110,000 TROY OUNCES (GOLD)
11,250,000 TROY OUNCES (SILVER)
FEE CONSIGNMENT AGREEMENT,
dated as of September 28, 1994,
between
HANDY & HARMAN,
as the Consignee
and
THE BANK OF NOVA SCOTIA,
as the Consignor.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . .
ARTICLE II
COMMITMENT; CONSIGNMENT PROCEDURES
2.1. Commitment and Consignment Procedures . . . . . .
2.1.1. Commitment . . . . . . . . . . . . . . . . . . .
2.1.2. Consignor Not Permitted or Required to Consign or
Continue Under Consignment Bullion . . . . . .
2.2. Reduction of Commitment Amount . . . . . . . . .
2.2.1. Optional Reduction of Commitment Amount . . . . .
2.2.2. Mandatory Reduction of Commitment Amount . . . .
2.3. Consignment Procedure; Delivery of Bullion . . .
2.3.1. Continuation and Return Elections . . . . . . . .
2.3.2. Quality . . . . . . . . . . . . . . . . . . . . .
2.3.3. Title and Purchase Price of Bullion. . . . . . .
2.4. Extension of Consignment Maturity Date . . . . .
2.4.1. Request for Extension of Consignment Maturity
Date . . . . . . . . . . . . . . . . . . . . .
2.4.2. Consent to Extension . . . . . . . . . . . . . .
ARTICLE III
RETURN OF BULLION; POST-MATURITY RATES; FEES
3.1. Return of Bullion . . . . . . . . . . . . . . . .
3.1.1. Consignment Maturity Date . . . . . . . . . . . .
3.1.2. Voluntary Return of Bullion . . . . . . . . . . .
3.1.3. Mandatory Return of Bullion . . . . . . . . . . .
3.1.4. Acceleration of Consignment Maturity Date . . . .
3.2. Post-Maturity Rates, etc . . . . . . . . . . . .
3.3. Fees . . . . . . . . . . . . . . . . . . . . . .
3.3.1. Consignment Fee . . . . . . . . . . . . . . . . .
3.3.2. Commitment Fee . . . . . . . . . . . . . . . . .
3.3.3. Other Fees . . . . . . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN OTHER PROVISIONS; SECURITY INTEREST
4.1. Consignments, etc. Unlawful . . . . . . . . . . .
4.2. Security Interest . . . . . . . . . . . . . . . .
4.3. Losses . . . . . . . . . . . . . . . . . . . . .
4.4. Increased Costs . . . . . . . . . . . . . . . . .
4.5. Taxes . . . . . . . . . . . . . . . . . . . . . .
4.6. Payments, Computations, etc. . . . . . . . . . .
ARTICLE V
CONDITIONS TO CONSIGNMENTS
5.1. Initial Consignment . . . . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . . .
5.1.2. Delivery of Financing Statements, etc. . . . .
5.1.3. Delivery of Waiver and Consent or Amendment . . .
5.1.4. Opinions of Counsel . . . . . . . . . . . . . . .
5.1.5. Closing Fees, Expenses, etc. . . . . . . . . . .
5.2. All Deliveries under Consignment . . . . . . . .
5.2.1. Compliance with Warranties, No Default, etc. . .
5.2.2. Consignment Request . . . . . . . . . . . . . . .
5.2.3. Continuation of Consignment Period . . . . . . .
5.2.4. Satisfactory Legal Form . . . . . . . . . . . . .
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Representations and Warranties . . . . . . . . .
6.2. Further Representations . . . . . . . . . . . . .
ARTICLE VII
COVENANTS
7.1. Covenants . . . . . . . . . . . . . . . . . . . .
7.2. Additional Covenants . . . . . . . . . . . . . .
7.2.1. Safekeeping, etc . . . . . . . . . . . . . . . .
7.2.2. Bullion to be Located at Plants . . . . . . . . .
7.2.3. Use of Bullion . . . . . . . . . . . . . . . . .
7.2.4. Further Assurances, etc . . . . . . . . . . . . .
7.2.5. SEC Filings . . . . . . . . . . . . . . . . . . .
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . .
8.1.1. Failure to Return Bullion, etc. . . . . . . . . .
8.1.2. Breach of Warranty . . . . . . . . . . . . . . .
8.1.3. Validity of Security Interest . . . . . . . . . .
8.1.4. Non-Performance of Other Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.5. Default on Material Contracts . . . . . . . . . .
8.1.6. Bankruptcy, Insolvency, etc. . . . . . . . . . .
8.1.7. Consignment Treatment . . . . . . . . . . . . . .
8.2. Action if Bankruptcy . . . . . . . . . . . . . .
8.3. Action if Other Event of Default . . . . . . . .
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.1. Waivers, Amendments, etc. . . . . . . . . . . . .
9.2. Notices . . . . . . . . . . . . . . . . . . . . .
9.3. Payment of Costs and Expenses . . . . . . . . . .
9.4. Indemnification . . . . . . . . . . . . . . . . .
9.5. Survival . . . . . . . . . . . . . . . . . . . .
9.6. Severability . . . . . . . . . . . . . . . . . .
9.7. Headings . . . . . . . . . . . . . . . . . . . .
9.8. Execution in Counterparts, Effectiveness, etc. .
9.9. Governing Law; Entire Agreement . . . . . . . . .
9.10. Successors and Assigns . . . . . . . . . . . . .
9.11. Forum Selection and Consent to Jurisdiction . . .
9.12. Waiver of Jury Trial . . . . . . . . . . . . . .
9.13. Benefit of this Agreement . . . . . . . . . . . .
9.14. Settlement Amount . . . . . . . . . . . . . . . .
9.15. Waiver of Immunity . . . . . . . . . . . . . . .
EXHIBIT A. Form of Consignment Request
EXHIBIT B. Form of Continuation/Return Request
EXHIBIT C Form of Consignment Extension Request
EXHIBIT D. Form of Opinion of General Counsel to the Consignee
EXHIBIT E. Form of Opinion of New York Counsel to the Consignee
EXHIBIT F. Form of Opinion of Connecticut Counsel to the
Consignor
EXHIBIT G. Form of Opinion of Rhode Island Counsel to the
Consignee
EXHIBIT H. Form of Opinion of Auditors to the Consignee
FEE CONSIGNMENT AGREEMENT
THIS FEE CONSIGNMENT AGREEMENT, dated as of September 28,
1994, between HANDY & HARMAN, a New York corporation (the
"Consignee") and THE BANK OF NOVA SCOTIA (the "Consignor"),
W I T N E S S E T H:
WHEREAS, the Consignee is engaged directly and through its
various Subsidiaries (such capitalized term, and other terms used
in these recitals, to have the meanings set forth in Section 1.1,
below) in the businesses described in the Consignee's Annual
Report on Form 10-K for the 1993 Fiscal Year;
WHEREAS, the Consignee desires to obtain the Commitment from
the Consignor pursuant to which the Consignor will from time to
time prior to the Commitment Termination Date consign up to
110,000 troy ounces of gold and up to 11,250,000 troy ounces of
silver (such gold and silver collectively referred to as the
"Bullion"), with the Bullion at all times to be located, except
as otherwise set forth herein, only at the Plants;
WHEREAS, the Consignor is willing, on the terms and subject
to the conditions hereinafter set forth (including Article V), to
extend the Commitment to consign the Bullion to the Consignee;
and
WHEREAS, the Bullion consigned to the Consignee will be used
at either one of the Plants in the production and fabrication of
products for customers of the Consignee in the ordinary course of
business;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION I.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"ABR Fee" is defined in Section 3.2.
"Agreement" means, on any date, this Fee Consignment
Agreement as originally in effect on the Effective Date and as
thereafter from time to time amended, supplemented, amended and
restated, or otherwise modified and in effect on such date.
"Authorized Officer" means those officers of the Consignee
whose signatures and incumbency shall have been certified to the
Consignor pursuant to Section 5.1.1.
"Bullion" is defined in the second recital.
"Bullion Sale" is defined in Section 4.2.
"Collateral" is defined in Section 4.2.
"Commitment" is defined in Section 2.1.1.
"Commitment Amount" means, on any day,
(a) with respect to gold, (i) 110,000 troy ounces of
gold or, if less, (ii) the maximum number of troy ounces of
gold obtained by dividing (A) $52,250,000 (or, if, on or
prior to such day, the Advance Commitment Amount is reduced
pursuant to the terms of the Dollar Supply Agreement, a
Dollar amount equal to the product of (x) the Advance
Commitment Amount (after giving effect to any reduction
thereto on or prior to such day) and (y) 41.6749751%), by
(B) $475 (rounded down to the next whole number); and
(b) with respect to silver, (i) 11,250,000 troy ounces
of silver or, if less, (ii) the maximum number of troy
ounces of silver obtained by dividing (A) $73,125,000 (or,
if, on or prior to such day, the Advance Commitment Amount
is reduced pursuant to the terms of the Dollar Supply
Agreement, a Dollar amount equal to the product of (x) the
Advance Commitment Amount (after giving effect to any
reduction thereto on or prior to such day) and (y)
58.3250249%), by (B) $6.50 (rounded down to the next whole
number);
as the amounts in clauses (a)(i) and (b)(i) above may be reduced
from time to time pursuant to Section 2.2 or as required in
accordance with the proviso contained in clause (b) of Section
2.4.2.
"Commitment Termination Date" means the earliest of
(a) the Consignment Maturity Date;
(b) the date on which the Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2;
(c) the occurrence of any Default described in clauses
(a) through (d) of Section 8.1.6;
(d) the occurrence and continuance of any other Event
of Default and either
(i) the declaration by the Consignor that the Bullion
is to be returned to it from consignment pursuant to
Section 8.3, or
(ii) in the absence of such declaration, the giving of
notice by the Consignor to the Consignee that the
Commitment has been terminated; and
(e) the occurrence of any Consignor Bankruptcy Event.
Upon the occurrence of any event described in clause (b), (c) or
(e), the Commitment shall terminate automatically and without
further action.
"Consignee" is defined in the preamble.
"Consignment Extension Request" means an extension request
duly executed by an Authorized Officer, substantially in the form
of Exhibit C hereto.
"Consignment Fee" is defined in clause (a) of Section 3.3.1.
"Consignment Maturity Date" means September 28, 1997, as
such date may be extended pursuant to Section 2.4.
"Consignment Period" means the period beginning on (and
including) the date on which any amount of Bullion is consigned
(or, in the case of previously consigned Bullion, the date on
which the consignment of such Bullion (or any portion thereof) is
continued in accordance with a Continuation/Return Notice) by the
Consignor to the Consignee pursuant to the terms of this
Agreement and shall end on (but exclude) the day which
numerically corresponds to such date one, two or three months (or
such other period, if agreed to by the Consignor) thereafter
(or, if such month has no numerically corresponding day, on the
last Business Day of such month), as the Consignee may select in
its relevant notice pursuant to Section 2.3 or 2.3.1; provided,
however, that
(a) Consignment Periods commencing on the same date
for consignments of Bullion comprising part of the same
consignment shall be of the same duration,
(b) if such Consignment Period would otherwise end on
a day which is not a Business Day, such Consignment Period
shall end on the next following Business Day; provided,
however, that if such next following Business Day is the
first Business Day of a calendar month, such Consignment
Period shall end on the next preceding Business Day, and
(c) no Consignment Period may end later than the
Consignment Maturity Date.
No more than ten Consignment Periods shall be in effect at any
one time.
"Consignment Request" means a request executed and delivered
by the Consignee in connection with the making of a consignment
of Bullion in the form of Exhibit A hereto.
"Consignor" is defined in the preamble.
"Contango Fee" means, with respect to any day, the
difference between the LIBO Rate (Reserve Adjusted) for a one
month Funding Period commencing on such day minus the Gold Rate
(in the case of consignments of gold) or the Silver Rate (in the
case of consignments of silver), in each case for a one month
Consignment Period commencing on such day.
"Continuation/Return Notice" means a notice of continuation
of consignment or return of all of a portion of Bullion
previously consigned hereunder to the Consignee duly executed by
an Authorized Officer, substantially in the form of Exhibit B
attached hereto.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Dollar Supply Agreement" means the Dollar Supply Agreement,
dated as of the date hereof (as amended, supplemented, amended
and restated or otherwise modified from time to time pursuant to
the terms thereof), among the Consignor, certain financial
institutions (the "Suppliers") from time to time parties thereto,
Chemical, BONY and Scotiabank as the co-agents for the Suppliers
and Scotiabank as the administrative agent for the Suppliers.
"Dollar Value of gold" means, as of any day of
determination, the value in Dollars of one troy ounce of gold as
determined by reference to the daily London Afternoon Fixing
Price for gold on such day. In the event there is no London
Afternoon Fixing Price for gold on a particular day, the last
established London Afternoon Fixing Price for gold shall apply;
provided, however that in the event such last established London
Afternoon Fixing Price is less than the Consignor's cost of
acquiring gold in the precious metals markets as of such day,
then the "Dollar Value of gold" as of such day shall equal the
Consignor's cost of gold in such markets as of such day, as
notified to the Consignee by the Consignor.
"Dollar Value of silver" means, as of any day of
determination, the value in Dollars of one troy ounce of silver
as determined by reference to the Silver Fixing Price for silver
on such day. In the event there is no Silver Fixing Price for
silver on a particular day, the last established Silver Fixing
Price for silver shall apply; provided, however, that in the
event such last established Silver Fixing Price is less than the
Consignor's cost of acquiring silver in the precious metals
markets as of such day, then the "Dollar Value of silver" as of
such day shall equal the Consignor's cost of silver in such
markets as of such day, as notified to the Consignee by the
Consignor.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 9.8.
"Event of Default" is defined in Section 8.1.
"Fee Consignment Document" means this Agreement, each
Consignment Request, each Consignment Extension Request and each
Continuation/Return Request.
"Fee Letter" is defined in the Revolving Credit Agreement.
"gold" means gold in London Good Delivery bar form, loco
London, England, and of a minimum fineness of .995, unless
otherwise mutually agreed to by the Consignor and Consignee in
advance of delivery to the Consignee.
"Gold Rate" means, with respect to any Consignment Period,
the arithmetic mean rate for the relevant Consignment Period as
shown on Reuters LIBO screen as at 10:00 a.m. London, England
time three Business Days prior to the first day of the
Consignment Period, less the mean rate shown on such date on the
Reuters GOFO page as at 10:00 a.m. London, England time;
provided, however, that in the event the Consignor determines
prior to the commencement of such Consignment Period that the
rate (as computed from the LIBO and GOFO Reuters pages set forth
in the preceding sentence) does not reflect the rate at which it
is prepared to provide consignments of gold for the relevant
Consignment Period, then the "Gold Rate" for such Consignment
Period shall be the rate, if any, which the Consignor notifies
the Consignee prior to the commencement of such Consignment
Period as the rate at which the Consignor is prepared to provide
consignments of a similar nature.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Fee Consignment Document
refer to this Agreement or such other Fee Consignment Document,
as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Fee
Consignment Document.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Fee Consignment Document, the parties
hereto agree that the rule of ejusdem generis shall not be
applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters or to matters
specifically mentioned.
"Indemnified Liabilities" is defined in Section 9.4.
"Indemnified Parties" is defined in Section 9.4.
"London Afternoon Fixing Price" shall mean the London
Afternoon Fixing Price, as determined by The London Bullion
Market Association.
"London Good Delivery" has the meaning ascribed thereto by
The London Bullion Market Association.
"Market Interruption Event" means the occurrence of an event
which (i) is not within the control of the Consignor or
attributable to any act of, or failure to act by, the Consignor,
and (ii) at any time causes the Consignor to be unable to conduct
transactions in any accessible international gold or silver
market sufficient to make, maintain or continue, in whole or in
part, any of the consignments of Bullion hereunder, including the
following:
(a) changes in national or international financial,
political or economic conditions;
(b) wars, strikes, or acts of God;
(c) acts of government or any governmental activity;
or
(d) a change in law or regulation (by governmental or
other regulatory authority, whether or not having the force
of law) or the interpretation thereof which has the effect
of making it illegal or impractical for the Consignor to
engage in the consignment of Bullion.
"Obligations" means all obligations (monetary or otherwise)
of the Consignee arising under or in respect of this Agreement
and each other Fee Consignment Document, including the obligation
of the Consignee to return or purchase Bullion pursuant to the
terms hereof.
"Organic Document" means, relative to the Consignee, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Plant" means, as the context may require, either the
Consignee's fabrication facility located at 1770 Kings Highway,
Fairfield, Connecticut or at 231 Ferris Avenue, East Providence,
Rhode Island.
"Processed Bullion" means an undivided interest in each
product of any goods and inventory containing gold and/or silver
located at either Plant or for which gold and/or silver located
at either Plant comprises a part thereof, which undivided
interest shall be, with respect to any such product, equal to the
ratio that the cost of such gold and/or silver (other than U.S.
Bullion) contained in such product or comprising a part thereof
bears to the cost of such product. Terms defined in the U.C.C.
and used in this definition have the meanings set forth in the
U.C.C.
"Revolving Credit Agreement" means the Revolving Credit
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof), among the Consignee, certain
financial institutions from time to time parties thereto,
Chemical, BONY and Scotiabank as co-agents and Scotiabank, as the
administrative agent; provided that if the Revolving Credit
Agreement shall be refinanced or otherwise terminated and is no
longer of force and effect at a time when this Agreement is still
in effect, then, for purposes of this Agreement, the "Revolving
Credit Agreement" shall mean the Revolving Credit Agreement, as
in effect immediately prior to the date of such refinancing or
termination.
"Settlement Amount" is defined in Section 9.14.
"Short-Term Dollar Supply Agreement" means the Short-Term
Dollar Supply Agreement, dated as of the date hereof (as amended,
supplemented, amended and restated or otherwise modified from
time to time pursuant to the terms thereof), among the Consignor,
the Suppliers from time to time parties thereto, Chemical, BONY
and Scotiabank as co-agents for the Suppliers and Scotiabank, as
the administrative agent for the Suppliers.
"Short-Term Fee Consignment Agreement" means the Short-Term
Fee Consignment Agreement, dated as of the date hereof, between
the Consignor and the Consignee, as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof.
"silver" means silver in London Good Delivery bar form, loco
London, England, and of a minimum fineness of .999, unless
otherwise mutually agreed to by the Consignor and the Consignee
in advance of delivery to the Consignee.
"Silver Fixing Price" means the Silver Fixing Price, as
determined by The London Silver Market Association.
"Silver Rate" means, with respect to any Consignment Period,
the rate that the Consignor notifies the Consignee prior to the
commencement of such Consignment Period as the rate which the
Consignor is prepared to provide funding for consignments of
silver of a similar nature for the relevant Consignment Period.
"Taxes" is defined in Section 4.5.
"U.C.C." means the Uniform Commercial Code, as in effect in
the State of New York from time to time.
"U.S. Bullion" means gold or silver of any quality or
fineness owned by the U.S. federal government and located from
time to time at the Plants (or either one of them).
SECTION I.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires,
(a) terms for which meanings are provided in (or by
reference in) this Agreement shall have such meanings when
used in any Fee Consignment Document, notice and other
communication delivered from time to time in connection with
this Agreement or any other Fee Consignment Document; and
(b) terms used in this Agreement or any Fee
Consignment Document that are not defined herein (or in such
Fee Consignment Document) are used herein (or in such Fee
Consignment Document) with the meanings set forth in the
Dollar Supply Agreement.
SECTION I.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Fee Consignment
Document to any Article or Section are references to such Article
or Section of this Agreement or such other Fee Consignment
Document, as the case may be, and, unless otherwise specified,
references in any Article, Section or definition to any clause
are references to such clause of such Article, Section or
definition.
ARTICLE II
COMMITMENT; CONSIGNMENT PROCEDURES
SECTION II.1. Commitment and Consignment Procedures. The
terms pursuant to which the Consignor will from time to time
deliver Bullion to be held under consignment by the Consignee or
continue to consign Bullion under consignment at the end of a
Consignment Period are as set forth in Sections 2.1.1 and 2.1.2,
below.
SECTION II.1.1. Commitment. On the terms and subject to
the conditions of this Agreement (including Article V), the
Consignor agrees from time to time on any Business Day occurring
prior to the Commitment Termination Date to deliver Bullion that
will be held on consignment by the Consignee in an aggregate
amount (not in excess of the Commitment Amount) as requested by
the Consignee. The commitment of the Consignor described in this
Section 2.1.1 is herein referred to as its "Commitment". On the
terms and subject to the conditions hereof, the Consignee may
from time to time prior to the Commitment Termination Date have
Bullion consigned to it, continue to hold under consignment all
or a portion of such Bullion, return all or a portion of such
Bullion from consignment to the Consignor and/or purchase all or
a portion of such Bullion, and thereafter have Bullion consigned
to it again.
SECTION II.1.2. Consignor Not Permitted or Required to
Consign or Continue Under Consignment Bullion. The Consignor
shall not be permitted or required to deliver any Bullion to be
held under consignment pursuant to the terms of this Agreement,
nor will the Consignor be required to continue to consign to the
Consignee at the end of any Consignment Period pursuant to
Section 2.3.1 Bullion then subject to such maturing Consignment
Period, to the extent (and only to the extent) that
(a) in the case of gold, after giving effect to the
requested consignment or continuation, the number of troy
ounces of gold consigned under this Agreement would exceed
the Commitment Amount then in effect relating to gold, as
set forth in the definition of "Commitment Amount";
(b) in the case of silver, after giving effect to the
requested consignment or continuation, the number of troy
ounces of silver consigned under this Agreement would exceed
the Commitment Amount then in effect relating to silver, as
set forth in the definition of "Commitment Amount"; or
(c) the Dollar Value of gold and the Dollar Value of
silver (as applicable) three Business Days prior to the
first day of the then requested Consignment Period or the
continuation of such Consignment Period, multiplied by the
number of troy ounces of gold and silver that is and will be
consigned under this Agreement (after giving effect to all
consignments of gold and silver requested on such date, and
any previous days (to the extent the gold and silver
previously requested has not yet been delivered under
consignment to the Consignee)), would exceed the Advance
Commitment Amount then in effect under the Dollar Supply
Agreement.
SECTION II.2. Reduction of Commitment Amount. The
Commitment Amount is subject to reduction from time to time
pursuant to this Section 2.2.
SECTION II.2.1. Optional Reduction of Commitment Amount.
The Consignee may, from time to time on any Business Day
occurring after the Effective Date, voluntarily reduce the
Commitment Amount; provided, however, that
(a) all such reductions shall require at least five
Business Days' prior written irrevocable notice to the
Consignor and be permanent;
(b) any partial reduction of the Commitment Amount
shall be in a minimum number of ounces of Bullion that
equals at least $10,000,000, based on the value of a troy
ounce of gold equalling $475, and a troy ounce of silver
equalling $6.50;
(c) the Commitment Amount of gold or silver may not be
so reduced to an amount less than the then aggregate number
of troy ounces of gold or silver (as the case may be) then
held under consignment pursuant to the terms of this
Agreement by the Consignee; and
(d) the Commitment Amount may only be reduced to zero
if, prior to or at the time of and as a condition to such
reduction, the Consignee shall have repaid in full all then
accrued and outstanding monetary Obligations and shall have
returned to the Consignor or purchased from the Consignor
pursuant to the terms of this Agreement all Bullion
previously consigned pursuant to the terms of this
Agreement.
SECTION II.2.2. Mandatory Reduction of Commitment Amount.
The Commitment Amount shall be permanently reduced on the date of
any permanent reduction in the Advance Commitment Amount as a
result of the operation of Section 2.4.2 of the Dollar Supply
Agreement by a number of troy ounces of Bullion equal to
(a) in the case of gold, the quotient obtained by
dividing (i) the product of (x) the Advance Commitment
Amount (after giving effect to any such reduction) and (y)
41.6749751% by (ii) $475 (rounded down to the next whole
number); and
(b) in the case of silver, the quotient obtained by
dividing (i) the product of (x) the Advance Commitment
Amount (after giving effect to any such reduction) and (y)
58.3250249%, by (ii) $6.50 (rounded down to the next whole
number).
SECTION II.3. Consignment Procedure; Delivery of Bullion.
By delivering a Consignment Request to the Consignor at or before
5:00 p.m. (New York City time), on a Business Day, the Consignee
may from time to time irrevocably request, on not less than four
nor more than five Business Days' notice, that a consignment of
Bullion be made by the Consignor in a number of ounces of gold
and/or silver such that the sum of the aggregate Dollar Value of
gold as of the date of such Consignment Request for all gold
subject to such Consignment Request plus the aggregate Dollar
Value of silver (as applicable) as of the date of such
Consignment Request for all silver subject to such Consignment
Request equals or exceeds $10,000,000 or, if less, in the
unutilized amount of the Commitment Amount for gold and/or
silver, as applicable. The Consignor will arrange for the
delivery of the Bullion to the applicable Plant (but only to such
Plants) in the amounts and types of Bullion requested for such
Plant in the Consignment Request on the date for delivery set
forth in the Consignment Request. The Consignor will assume all
risk of loss or damage to the Bullion until it has been delivered
to the applicable Plant, at which time such risk shall pass to
the Consignee, and unless the Consignee notifies the Consignor
within one day following delivery of such Bullion that such
Bullion is damaged, or does not conform to the quality or
fineness of Bullion requested to be delivered under consignment,
then such Bullion delivered to the Consignee shall be deemed to
be not damaged and to conform with the quality and fineness so
requested by the Consignee. Any Bullion delivered to the
Consignee that is damaged or that does not conform to the quality
and fineness of the requested Bullion shall be immediately
delivered back to the Consignor by the Consignee. In the case of
the return of Bullion to the Consignor from the Consignee, all
deliveries of Bullion will be made in accordance with the
directions of the Consignor at such address as the Consignor may
direct in a written notice to the Consignee. The Consignee shall
bear the cost of such delivery. The Consignee will assume all
risk of loss or damage to the Bullion until it has been delivered
to the Consignor, at which time such risk shall pass to the
Consignor.
SECTION II.3.1. Continuation and Return Elections. By
delivering a Continuation/Return Notice to the Consignor at or
before 5:00 p.m. (New York City time) on a Business Day that is
at least four but no more than five Business Days prior to the
expiration of a Consignment Period, the Consignee may from time
to time irrevocably elect that either (a) all Bullion subject to
such Consignment Period either remain under consignment from the
Consignor hereunder for such Consignment Periods as are selected
by the Consignee in such Continuation/Return Request or be
returned to the Consignor, or (b) that only a portion of the
Bullion subject to such Consignment Period remain under
consignment from the Consignor hereunder for such Consignment
Periods as are selected by the Consignee in such
Continuation/Return Request and that the remainder of such
Bullion be returned to and/or purchased from the Consignor;
provided, that the amount of Bullion, if any, to be subject to
the Consignment Periods requested in such Continuation/Return
Request, and the amount of Bullion, if any, elected to be
returned and/or purchased pursuant to such Continuation/Return
Request, shall have, in each case (unless the Consignee has
elected that all of the Bullion subject to such maturing
Consignment Period be continued hereunder for new Consignment
Periods or that all such Bullion be returned), an aggregate
Dollar Value of gold or Dollar Value of silver (as applicable),
or combination thereof, in each case as of the date of such
Continuation/Return Notice, equal to or greater than $10,000,000.
In the absence of delivery of a Continuation/Return Notice with
respect to any then maturing Consignment Period at least four but
no more than five Business Days prior to the last day of the then
current Consignment Period with respect thereto, the Consignee
shall be deemed, subject to satisfaction of the conditions set
forth in Section 5.2.3, to have requested that the entire amount
(or such lesser amount as may be otherwise permitted pursuant to
the terms hereof) of Bullion that was consigned in connection
with the then maturing Consignment Period remain consigned
hereunder for a Consignment Period of one month.
SECTION II.3.2. Quality. Gold and silver delivered to the
Consignee and returned to the Consignor shall in each case be of
the quality set forth in the definition of "gold" and of
"silver", respectively.
SECTION II.3.3. Title and Purchase Price of Bullion. Title
to the Bullion delivered on consignment by the Consignor
hereunder will remain with the Consignor and will not pass to the
Consignee. To the extent that any Bullion (or a portion of
Bullion) is purchased by the Consignee pursuant to the terms of
this Agreement, then title only to such Bullion (or such portion
of Bullion) will transfer to the Consignee. If the Consignee
wishes to purchase part or all of the Bullion held on consignment
from the Consignor, an Authorized Officer of the Consignee will
make a request to the Consignor stating the number of ounces of
Bullion and the quality of Bullion to be purchased and the
proposed date of the purchase. At the Consignor's sole option
and only if it desires to enter into the requested sale, the
Consignor shall at least two Business Days prior to the proposed
date for such purchase (or such lesser number of days as the
Consignor and the Consignee may agree), provide an Authorized
Officer of the Consignee with a quotation of the price at which
the Consignor is willing to sell the Bullion to the Consignee
multiplied by the number of ounces of Bullion to be purchased.
If such price is agreed to in a written notice by the Consignee
to the Consignor, such Bullion will thereupon be conclusively
deemed to have been contracted for purchase, with payment of the
purchase price by the Consignee to be made in cash on the date
agreed to by the Consignor and the Consignee (and the Consignee
agrees that in any event payment in cash to the Consignor for any
purchase of Bullion in respect of a specific Consignment Period
shall be made to the Consignor on or before the last day of such
Consignment Period). Title to the Bullion purchased by the
Consignee as provided above will pass to the Consignee only upon
receipt by the Consignor in immediately available funds of the
total purchase price due from the Consignee as payment for the
Bullion purchased.
SECTION II.4. Extension of Consignment Maturity Date. The
Consignment Maturity Date shall be subject to extension as set
forth in this Section.
SECTION II.4.1. Request for Extension of Consignment
Maturity Date. Any term or provision of this Agreement to the
contrary notwithstanding, not earlier than 60 days nor later than
45 days prior to the first anniversary of the Effective Date,
and/or each and any successive anniversary thereafter (if the
Commitment then remains in effect), the Consignee may, by
delivery of a duly completed Consignment Extension Request to the
Consignor, irrevocably request that the Consignor extend for a
one year period the then existing Consignment Maturity Date.
SECTION II.4.2. Consent to Extension. (a) The Consignor
shall, within 35 days of receipt of the notice described in
Section 2.4.1, notify the Consignee whether or not it consents to
the Consignee's request set forth in such Consignment Extension
Request, such consent to be in the sole discretion of the
Consignor. If the Consignor does not so notify the Consignee of
its decision within such 35 day period, then the Consignor shall
be deemed not to have consented to such request of the Consignee.
(b) Notwithstanding anything to the contrary contained in
this Section, the Consignment Maturity Date shall not be extended
for an additional period unless, in addition to the receipt of an
approval by the Consignor to extend such date pursuant to clause
(a) above, Suppliers whose Percentages equal or exceed 75% of the
Advance Commitment Amount under the Dollar Supply Agreement
(after giving effect to the operation of clause (c) of Section
2.4.2 of the Dollar Supply Agreement) have also so consented to
an extension of the Stated Maturity Date in accordance with
Section 2.4.2 of the Dollar Supply Agreement; provided, if there
shall occur any reduction in the Advance Commitment Amount as a
result of the operation of Section 2.4.2 of the Dollar Supply
Agreement, then the Commitment Amount hereunder shall be
similarly reduced in accordance with Section 2.2.2.
ARTICLE III
RETURN OF BULLION; POST-MATURITY RATES; FEES
SECTION III.1. Return of Bullion. The Consignee shall
deliver to the Consignor all or a portion (as applicable) of the
Bullion then held under consignment by it in accordance with the
terms of this Section. No return of Bullion pursuant to this
Article III shall cause a reduction in the Commitment Amount.
Notwithstanding anything to the contrary contained herein or in
any other Fee Consignment Document, whenever the Consignee is
entitled or required to return to the Consignor any Bullion held
under consignment by the Consignee hereunder, instead of
returning such Bullion the Consignee may return and deliver all
of its right, title and interest in and to other gold and/or
silver, as applicable, to the Consignor which in all cases shall
be owned by the Consignee and shall be free and clear of all
Liens and adverse claims in an equivalent amount, and of an
equivalent quality and fineness, as such Bullion, and any such
return of other gold and/or silver, as applicable, shall
constitute a return of such Bullion for all purposes of this
Agreement and shall constitute a purchase of such Bullion for
purposes of the second sentence of each of Sections 2.3.3 and
4.2.
SECTION III.1.1. Consignment Maturity Date. The Consignee
shall, at its election, either return to the Consignor and/or
purchase for cash all Bullion then consigned to it hereunder upon
the Consignment Maturity Date provided, that if on any
Consignment Maturity Date (without giving effect to any extension
of such date), a partial reduction to the Commitment Amount is
required in accordance with Section 2.2.2, then the Consignee
shall either return to the Consignor and/or purchase for cash
from the Consignor an amount of Bullion that is equal to the
amount of such reduction. To the extent the Consignor agrees to
a sale of Bullion for cash, the purchase price for each troy
ounce of any such gold or silver that the Consignee purchases
shall be determined in accordance with Section 2.3.3.
SECTION III.1.2. Voluntary Return of Bullion. From time to
time on any Business Day prior to the Consignment Maturity Date,
the Consignee may voluntarily return to the Consignor all (or any
portion) of Bullion previously consigned to it hereunder in
respect of a Consignment Period as designated by the Consignee;
provided, however, that
(a) no such voluntary return to the Consignor may be
made on any day other than the last day of the applicable
Consignment Period with respect to the Bullion then being
returned to the Consignor, unless the Consignor shall have
agreed to such return and the Consignee shall have given the
Consignor at least two (but no more than five) Business
Days' notice, and has paid any costs required pursuant to
clause (a) of Section 9.4 and clause (iii) of Section 9.3;
and
(b) all such voluntary partial returns of Bullion from
consignment shall be in a minimum number of troy ounces of
Bullion such that the number of ounces of Bullion returned
multiplied by the Dollar Value of gold or the Dollar Value
of silver (or both, if applicable) as in effect three
Business Days prior to the scheduled date of such return is
equal to or greater than $10,000,000.
SECTION III.1.3. Mandatory Return of Bullion. The
Consignee shall return Bullion to the Consignor upon the
occurrence of any of the events set forth in this Section.
(a) If, on the last day of any Consignment Period:
(i) the number of troy ounces of gold then consigned
by the Consignor to the Consignee hereunder exceeds the
then effective Commitment Amount for gold on such date,
or
(ii) the number of troy ounces of silver then consigned
by the Consignor to the Consignee hereunder exceeds the
then effective Commitment Amount for silver on such
date,
in each case as the applicable Commitment Amount may have
been reduced pursuant to the terms of this Agreement, then
the Consignee shall, at its election, either mandatorily
return to the Consignor and/or purchase from the Consignor
that number of troy ounces of gold or silver (or both) in
the amount of such excess on the last day of such
Consignment Period; provided, that notwithstanding the
foregoing, the Consignee shall not be required to purchase
or return any Bullion pursuant to this clause except for
Bullion that was consigned in connection with such maturing
Consignment Period. To the extent the Consignor agrees to a
sale of Bullion pursuant to Section 2.3.3, the purchase
price for each troy ounce of any such gold or silver that
the Consignee purchases shall be determined in accordance
with Section 2.3.3.
(b) Upon the occurrence and continuance of any Market
Interruption Event and demand in writing by the Consignor to
the Consignee, the Consignee shall, at its election, either
return to the Consignor and/or purchase for cash from the
Consignor on the last day of each then maturing Consignment
Period (or earlier, if required in the reasonable
determination of the Consignor or if required by law), the
amount of Bullion so demanded by the Consignor. To the
extent the Consignor agrees to a sale of Bullion to the
Consignee pursuant to Section 2.3.3, the purchase price for
each troy ounce of any such gold or silver that the
Consignee purchases shall be determined in accordance with
Section 2.3.3.
(c) Pursuant to an appropriately completed
Continuation/Return Notice delivered at least four but not
more than five Business Days prior to the last day of a
Consignment Period in accordance with the terms of Section
2.3.1 pursuant to which the Consignee has indicated that it
will return all or a portion of Bullion previously consigned
to it at the end of a Consignment Period, the Consignee
shall, at its election, either return to the Consignor
and/or purchase from the Consignor on the last day of the
applicable Consignment Period that number of troy ounces of
Bullion indicated in such Continuation/Return Notice on the
last day of the then maturing Consignment Period. To the
extent the Consignor agrees to a sale of Bullion to the
Consignee pursuant to Section 2.3.3, the purchase price for
each troy ounce of any such gold or silver that the
Consignee purchases shall be determined in accordance with
Section 2.3.3.
(d) Upon the failure of any Supplier to fund any
Advance on the commencement date of a Consignment Period as
required pursuant to the terms of the Dollar Supply
Agreement the Consignee shall, within three Business Days
following demand by the Consignor, return or purchase
pursuant to the terms of this Agreement (unless such failure
is no longer continuing) the number of ounces of each type
of Bullion that was previously consigned in respect of such
non-funded Advance.
(e) Upon the last day of any then maturing Consignment
Period on which the Dollar Value of gold as in effect three
Business Days prior to the first day of the next occurring
Consignment Period multiplied by the number of ounces of
gold then consigned and the Dollar Value of silver as in
effect three Business Days prior to the first day of the
next occurring Consignment Period multiplied by the number
of ounces of silver then consigned exceeds the then
effective Advance Commitment Amount, the Consignee shall, at
its election, either return to the Consignor and/or purchase
for cash from the Consignor on the last day of such maturing
Consignment Period, the number of troy ounces of Bullion
such that the Dollar Value of gold and Dollar Value of
silver (in each case as in effect three Business Days prior
to the first day of the next occurring Consignment Period)
that will remain consigned shall not exceed the Advance
Commitment Amount; provided, that notwithstanding the
foregoing, the Consignee shall not be required to purchase
or return any Bullion other than Bullion that was consigned
in connection with such then maturing Consignment Period.
To the extent the Consignor agrees to a sale of Bullion
pursuant to Section 2.3.3, the purchase price for each troy
ounce of any such gold or silver that the Consignee
purchases shall be determined in accordance with
Section 2.3.3.
SECTION III.1.4. Acceleration of Consignment Maturity Date.
Immediately upon any acceleration of the Consignment Maturity
Date pursuant to Section 8.2 or Section 8.3, the Consignee shall,
at its election, either return to the Consignor and/or purchase
for cash pursuant to the terms of this Agreement from the
Consignor all Bullion then under consignment to the full extent
of such acceleration. To the extent the Consignor agrees to a
sale of Bullion, the purchase price for each troy ounce of any
such gold or silver that the Consignee purchases shall be
determined in accordance with Section 2.3.3.
SECTION III.2. Post-Maturity Rates, etc. After the date
any monetary Obligation of the Consignee hereunder shall have
become due and payable, the Consignee shall pay interest (after
as well as before judgment) on such amounts on demand at a rate
per annum equal to the Alternate Base Rate plus a margin of 2%
per annum. In addition, to the extent that the Consignee fails
to return (or purchase) any Bullion on the dates required
pursuant to the terms of this Agreement, the Consignee shall pay
to the Consignor (after as well as before judgment) on demand,
instead of the fees set forth in Section 3.3.1, for each day that
such Bullion is not returned or purchased, an amount (the "ABR
Fee") equal to the product of (a) the Alternate Base Rate in
effect on such day plus a margin of 2% per annum minus the
Contango Fee as in effect on such day and (b) the Dollar Value of
gold and the Dollar Value of silver (as applicable) in each case
as in effect three Business Days prior to the first day of each
applicable Consignment Period then in effect multiplied by the
number of ounces of gold and/or silver not so returned or
purchased on or prior to such day.
SECTION III.3. Fees. The Consignee agrees to pay the fees
set forth in this Section 3.3. All such fees shall be non-
refundable.
SECTION III.3.1. Consignment Fee. (a) The Consignee
agrees to pay to the Consignor in arrears with respect to each
troy ounce of gold and/or silver held on consignment hereunder a
consignment fee (the "Consignment Fee") based on the Gold Rate
(in the case of consignments of gold) and the Silver Rate (in the
case of consignments of silver) plus in each case a margin of 1/2
of 1% per annum, on the Dollar Value of such gold (in the case of
consignments of gold) or the Dollar Value of such silver (in the
case of consignments of silver) as in effect three Business Days
prior to the first day of the Consignment Period then in effect
for such Bullion multiplied by the number of troy ounces of gold
and silver, respectively, consigned for each such Consignment
Period.
(b) For each day on which any Advances bear interest at the
Alternate Base Rate pursuant to Section 4.1, 4.2 or 4.3 of the
Dollar Supply Agreement, the Consignee agrees to pay to the
Consignor in arrears an additional consignment fee on an amount
equal to the aggregate principal amount of all Advances then
bearing interest at the Alternate Base Rate, such fee with
respect to any such Advances to be (i) calculated based on a rate
equal to the positive difference, if any, between (x) the
Alternate Base Rate then in effect, and (y) the LIBO Rate
(Reserve Adjusted) (or, if applicable as a result of the
operation of Section 4.2 of the Dollar Supply Agreement, the
Substitute Rate) that was in effect as of the first day of the
Consignment Period applicable to such Advances plus (in each
case) 1/2 of 1% per annum, and (ii) payable on the last day of
the Consignment Period then applicable to such Advances (or on
each three-month anniversary of such Consignment Period if such
Consignment Period is in excess of three months).
The Consignment Fee will be paid in arrears (a) on the
Consignment Maturity Date, (b) on the last day of each
Consignment Period (or on each three-month anniversary of a
Consignment Period, for Consignment Periods that are longer than
three months) with respect to the Bullion subject to such
Consignment Period and (c) on the date of any reduction in the
Commitment Amount pursuant to Section 2.2.1 or 2.2.2, in an
amount equal to any accrued Consignment Fee on that portion of
the Commitment Amount being reduced.
SECTION III.3.2. Commitment Fee. The Consignee agrees to
pay to the Consignor a commitment fee equal to 1/5 of 1% per
annum multiplied by the product of (a) the difference between (i)
the average daily number of ounces of gold or silver, as the case
may be, committed to be consigned hereunder (based on the Dollar
Value of gold equalling $475 per ounce and the Dollar Value of
silver equalling $6.50 per ounce) during the relevant period, and
(ii) the average daily number of ounces of gold or silver, as the
case may be, actually consigned hereunder during the relevant
period, and (b) $475 (in the case of gold) and $6.50 (in the case
of silver). Such commitment fee shall be payable in arrears on
each Quarterly Payment Date and on the Commitment Termination
Date.
SECTION III.3.3. Other Fees. The Consignee agrees to pay
to the Consignor those fees, in the amounts and on the dates, set
forth in the Fee Letter.
ARTICLE IV
CERTAIN OTHER PROVISIONS; SECURITY INTEREST
SECTION IV.1. Consignments, etc. Unlawful. If the
Consignor shall determine (which determination shall, upon notice
thereof to the Consignee, absent manifest error, be prima facie
evidence of the facts stated therein) that the introduction of or
any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority
having authority over the Consignor asserts that it is unlawful,
for the Consignor to consign (or maintain previously consigned)
Bullion with the Consignee, the obligations of the Consignor to
consign (or to maintain previously consigned) Bullion with the
Consignee shall, upon such determination, forthwith be suspended
until the Consignor shall notify the Consignee that the
circumstances causing such suspension no longer exist (which
notification the Consignor agrees to give promptly when such
circumstances no longer exist), and all Bullion theretofore
delivered under consignment to the Consignee hereunder shall be,
at the election of the Consignee, either returned to and/or
purchased pursuant to the terms hereof from the Consignor at the
end of the then current Consignment Periods with respect thereto
or sooner, if required by such law or assertion.
SECTION IV.2. Security Interest. Title to Bullion
delivered on consignment by the Consignor hereunder will remain
with the Consignor and will not pass to the Consignee. To the
extent that any Bullion (or a portion of Bullion) is purchased by
the Consignee pursuant to the terms of this Agreement, then title
only to such Bullion (or such portion of Bullion) will transfer
to the Consignee. The intent of the parties hereto is to create
a true consignment from the Consignor to the Consignee and not a
consignment for security, provided, however, that in order to
protect the rights of the Consignor in the event that this
Agreement and the transactions contemplated hereby are construed
at any time with respect to any Bullion as other than a true
consignment from the Consignor to the Consignee (including as a
result of a Bullion Sale), as security for its Obligations (as
defined in this Agreement and the Short-Term Fee Consignment
Agreement) the Consignee hereby grants the Consignor a Lien on
and security interest in and to the Collateral (whether now or
hereafter existing). "Collateral" means all of the Consignee's
right, title and interest in and to (i) all gold and silver of
any quality or fineness (including the Bullion), other than the
U.S. Bullion, located from time to time at the Plants, (ii) all
Processed Bullion located from time to time at the Plants and
(iii) all proceeds of such gold and silver, including, to the
extent that the Consignee has not returned to the Consignor
and/or purchased pursuant to the terms hereof any amount of
Bullion (or other gold and/or silver) that is delivered to any
account debtor of the Consignee, accounts owing by such account
debtor, and related general intangibles (if any) arising from the
sale of such gold and silver (including the Bullion and the gold
and silver (other than U.S. Bullion) comprising any Processed
Bullion). Terms used in the definition of Collateral for which
meanings are provided in the U.C.C. are used in the definition of
Collateral with such meanings. "Bullion Sale" means any sale of
Bullion by the Consignor to the Consignee, which sale shall occur
(notwithstanding the provisions of Section 2.3.3) at any time the
Consignee takes title to any Bullion, whether pursuant to Section
2.3.3 or at such earlier or other date as provided by law or
court order or decree. To the extent this Agreement and the
transactions contemplated hereby are not construed as a true
consignment from the Consignor to the Consignee, or upon the
occurrence of any Bullion Sale, the security interest granted
pursuant to this Section secures the complete and punctual
payment of all "Obligations" of the Consignee, whether now or
hereafter existing, under and as defined in (a) this Agreement
and each other Fee Consignment Document and (b) the Short-Term
Fee Consignment Agreement and each other Fee Consignment Document
(as defined therein). To the extent any gold and/or silver
(other than the U.S. Bullion) of any quality or fineness
(including the Bullion) located at either Plant becomes part of a
product, the Consignor shall only have and shall continue to have
rights or interests in and to such product to the extent of an
undivided interest in such product that is equal to the ratio
that the cost of such gold and/or silver (other than the U.S.
Bullion) contained in such product or comprising a part thereof
bears to the cost of such product. In addition, gold and/or
silver (other than the U.S. Bullion) of any quality or fineness
(including the Bullion) located at either Plant that becomes part
of a product shall continue to be considered as being consigned
to the Consignee hereunder to the same extent as if such gold
and/or silver did not become part of a product and shall be
subject to all the terms hereof (including the continuation of
title to such gold and/or silver in the Consignor).
Notwithstanding the express intent of the parties hereto that
this Agreement and the transactions contemplated hereby be a true
consignment from the Consignor to the Consignee, the Consignee
shall file precautionary Uniform Commercial Code financing
statements to protect the rights of the Consignor in and to the
Collateral. In furtherance of the intent of the parties hereto
that this Agreement and the transactions contemplated hereunder
are a true consignment from the Consignor to the Consignee, and
not a consignment for security, the Consignor agrees that for so
long as no Event of Default has occurred and is continuing, it
will not initiate any action, suit or proceeding claiming that
this Agreement or any of the transactions contemplated hereunder
are other than a true consignment from the Consignor to the
Consignee.
SECTION IV.3. Losses. In the event the Consignor shall
incur any loss or expense as a result of
(a) any return to or purchase from the Consignor of
Bullion on a date other than the scheduled last day of the
Consignment Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any consignment of Bullion not being made in the
quantity or on the date requested by the Consignee, except
to the extent the same results from the failure of the
Consignor to satisfy its obligations hereunder with respect
thereto; or
(c) any consigned Bullion failing to remain under
consignment in accordance with the Continuation/Return
Notice therefor,
then, upon the written notice of the Consignor to the Consignee,
the Consignee, without duplication of its other Obligations,
shall, within five days of its receipt thereof, pay directly to
the Consignor such amount as will (in the reasonable
determination of the Consignor) reimburse the Consignor for such
loss or expense. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of
manifest error, be prima facie evidence of the matters stated
therein.
SECTION IV.4. Increased Costs. If any change in, or
the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority having authority over the Consignor
affects or would affect the amount of capital required or
expected to be maintained by the Consignor or any Person
controlling the Consignor, and the Consignor determines (in its
sole and absolute discretion) that the rate of return on its or
such controlling Person's capital as a consequence of its
Commitment or the consignment of Bullion hereunder is reduced to
a level below that which the Consignor or such controlling Person
could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to
time by the Consignor to the Consignee, the Consignee shall
immediately pay directly to the Consignor additional amounts
sufficient to compensate the Consignor or such controlling Person
for such reduction in rate of return. A statement of the
Consignor as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence
of manifest error, be prima facie evidence of the matters stated
therein. In determining such amount, the Consignor may use any
method of averaging and attribution that it (in its sole and
absolute discretion) shall deem applicable.
SECTION IV.5. Taxes. All payments by the Consignee
hereunder and by the Consignor to the Administrative Agent and
the Suppliers under the Dollar Supply Agreement (including in
each case in respect of fees) shall be made free and clear of and
without deduction for any present or future income, excise, stamp
or franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing
authority, but excluding franchise taxes and taxes imposed on or
measured by the Consignor's, the Administrative Agent's or such
Supplier's net income or receipts imposed by the jurisdiction of
incorporation or organization of the Consignor, the
Administrative Agent or such Supplier, as the case may be (such
non-excluded items being called "Taxes"). In the event that any
withholding or deduction from any payment to be made by the
Consignee hereunder or by the Consignor under the Dollar Supply
Agreement is required in respect of any Taxes pursuant to any
applicable law, rule or regulation, then the Consignee will
(a) in the case of withholding or deduction (i) in
respect of payments made for the account of the Consignor
hereunder, pay directly to the relevant authority the full
amount required to be so withheld or deducted, and (ii) in
respect of payments made by the Consignor to the
Administrative Agent or the Suppliers under the Dollar
Supply Agreement, pay to the Consignor (and the Consignor
hereby agrees to pay over to the relevant authority) the
full amount required to be so withheld or deducted;
(b) in the case of clause (a)(i), promptly forward to
the Consignor an official receipt or other documentation
satisfactory to the Consignor evidencing such payment to
such authority; and
(c) pay to the Consignor such additional amount or
amounts as is necessary to ensure that the net amount
actually received by the Consignor, the Administrative Agent
or such Supplier will equal the full amount such Person
would have received had no such withholding or deduction
been required.
Moreover, if the Consignor, the Administrative Agent or any
Supplier is obligated to pay any Taxes with respect to any
payment received by the Consignor hereunder or by the Consignor,
the Administrative Agent or such Supplier under the Dollar Supply
Agreement, it may pay such Taxes and the Consignee will promptly
pay such additional amounts directly to the Consignor (and, in
the case of Taxes payable by the Administrative Agent or a
Supplier under the Dollar Supply Agreement, the Consignor agrees
to pay over to the Administrative Agent or such Supplier, as
applicable) as is necessary in order that the net amount received
by such Person after the payment of such Taxes (including any
Taxes on such additional amount) shall equal the amount such
Person would have received had not such Taxes been asserted.
If the Consignee fails to pay any Taxes when due to the
appropriate taxing authority (in the case of clause (a)(i)) or
the Consignor (in the case of clause (a)(ii)) or fails to remit
to the Consignor, for the account of the Consignor or for the
account of the Administrative Agent or any Supplier, as set forth
above, the required receipts or other required documentary
evidence, the Consignee shall indemnify such Person for any
incremental Taxes, interest or penalties that may become payable
by such Person as a result of any such failure. Upon the request
of the Consignee, the Consignor shall, prior to the due date of
any payments hereunder, execute and deliver to the Consignee on
or about the first scheduled payment date in each Fiscal Year,
one or more (as the Consignee may reasonably request) United
States Internal Revenue Service Forms 4224 or Forms 1001 or such
other forms or documents (or successor forms or documents),
appropriately completed, as may be applicable to establish that
payments to the Consignor are exempt from withholding or
deduction of Taxes.
SECTION IV.6. Payments, Computations, etc. Unless
otherwise expressly provided, all payments of Dollars by the
Consignee pursuant to this Agreement or any other Fee Consignment
Document shall be made by the Consignee to the Consignor without
setoff, deduction or counterclaim, not later than 11:00 a.m.
(New York City time), on the date due, in immediately available
funds, to such account as the Consignor shall specify from time
to time by notice to the Consignee. Funds received after that
time shall be deemed to have been received by the Consignor on
the next succeeding Business Day. All fees shall be computed on
the basis of the actual number of days (including the first day
but excluding the last day) occurring during the period for which
such interest or fee is payable over a year comprised of
360 days. Whenever any payment to be made shall otherwise be due
on a day which is not a Business Day, such payment shall (except
as otherwise required by clause (b) of the definition of the term
"Consignment Period") be made on the next succeeding Business Day
and such extension of time shall be included in computing
interest and fees, if any, in connection with such payment.
ARTICLE V
CONDITIONS TO CONSIGNMENTS
SECTION V.1. Initial Consignment. The obligations of the
Consignor to make the initial consignment of Bullion on and after
the Effective Date shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in
this Section 5.1.
SECTION V.1.1. Resolutions, etc. The Consignor shall have
received from the Consignee a certificate, dated the date of the
initial delivery of Bullion under consignment, of its Secretary
or Assistant Secretary as to
(a) resolutions of its Board of Directors then in full
force and effect authorizing the execution, delivery and
performance of this Agreement and each other Fee Consignment
Document to be executed by it;
(b) true and complete copies of the Consignee's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement
and each other Fee Consignment Document executed by it,
upon which certificate the Consignor may conclusively rely until
it shall have received a further certificate of the Secretary or
Assistant Secretary of the Consignee canceling or amending such
prior certificate.
SECTION V.1.2. Delivery of Financing Statements, etc. The
Consignor shall have received
(a) acknowledgment copies (or other evidence
satisfactory to it) of properly filed Uniform Commercial
Code financing statements (Form UCC-1), and (if available)
Uniform Commercial Code financing statements (Form UCC-3),
each dated a date reasonably near to the Effective Date,
naming (i) Handy & Harman as the consignee and The Bank of
Nova Scotia as the consignor (in the case of the Form UCC-1
Statements), and (ii) The Bank of Nova Scotia (as assignor)
and The Bank of Nova Scotia, in its capacity as
Administrative Agent (as assignee) (in the case of the Form
UCC-3 statements) or other similar instruments or documents,
filed under the Uniform Commercial Code of all jurisdictions
as may be necessary or, in the opinion of the Consignor,
desirable to perfect the interest of the Consignor pursuant
to the terms of this Agreement;
(b) executed copies of proper Uniform Commercial Code
Form UCC-3 termination statements, if any, necessary to
release all Liens and other rights of any Person in any
Collateral previously granted by the Consignee; and
(c) certified copies of Uniform Commercial Code
Requests for Information or Copies (Form UCC-11), or a
similar search report certified by a party acceptable to the
Consignor, dated a date reasonably near to the Effective
Date, listing all effective financing statements which name
the Consignee (under its trade names, present name and any
previous names) as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to clause
(a) above, together with copies of such financing statements
(none of which shall cover any Collateral).
SECTION V.1.3. Delivery of Waiver and Consent or Amendment.
The Consignor shall have received a copy of a waiver and consent,
amendment or such other written agreement in form and substance
satisfactory to it from the respective holders of the Consignee's
8.83% Senior Notes due August 25, 2002, 9.37% Senior Notes due
December 27, 1999 and 10.2% Series D Senior Notes due 1998, duly
executed and delivered by such holders except to the extent that
all Indebtedness owing in respect of such notes has been paid in
full.
SECTION V.1.4. Opinions of Counsel. The Consignor shall
have received opinions, dated the date of the initial consignment
and, except as set forth below, addressed to the Consignor
(together, in the case of other than clause (e), with reliance
letters to the Administrative Agent and the Suppliers), from
(a) Paul E. Dixon, Vice President and General Counsel
of the Consignee, substantially in the form of Exhibit D
hereto (and the Consignee hereby expressly instructs such
counsel to deliver such opinions to the Consignor, the
Administrative Agent and the Suppliers);
(b) Skadden, Arps, Slate, Meagher & Flom, New York
counsel to the Consignee, substantially in the form of
Exhibit E hereto (and the Consignee hereby expressly
instructs such counsel to deliver such opinions to the
Consignor, the Administrative Agent and the Suppliers);
(c) Bingham, Dana & Gould, Connecticut counsel to the
Consignor, substantially in the form of Exhibit F hereto
(and the Consignor hereby expressly instructs such counsel
to deliver such opinions to the Administrative Agent and the
Suppliers);
(d) Edwards & Angell, Rhode Island counsel to the
Consignee, substantially in the form of Exhibit G hereto
(and the Consignee hereby expressly instructs such counsel
to deliver such opinions to the Consignor, the
Administrative Agent and the Suppliers); and
(e) KPMG Peat Marwick, independent public accountants
to the Consignee, addressed to the Consignee and
substantially in the form of Exhibit H hereto.
SECTION V.1.5. Closing Fees, Expenses, etc. The Consignor
shall have received all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 9.3, if then invoiced.
SECTION V.2. All Deliveries under Consignment. The
obligation of the Consignor to deliver any Bullion on the
occasion of any consignment (including the initial consignment)
to the Consignee shall be subject to the satisfaction of each of
the conditions precedent set forth in this Section 5.2.
SECTION V.2.1. Compliance with Warranties, No Default, etc.
Both before and after giving effect to the delivery of Bullion
requested to be held under consignment hereunder, the following
statements shall be true and correct:
(a) the representations and warranties set forth in
Article VI (including those incorporated by reference from
the Revolving Credit Agreement (other than those contained
in Section 6.7 of the Revolving Credit Agreement for any
consignment of Bullion that is to occur after the initial
consignment of Bullion hereunder)) shall be true and correct
in all material respects with the same effect as if then
made (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true
and correct as of such earlier date);
(b) except as disclosed by the Consignee to the
Consignor pursuant to Section 6.7 of the Revolving Credit
Agreement,
(i) no litigation, arbitration or governmental
investigation or proceeding shall be pending or, to the
knowledge of the Consignee, threatened against the
Consignee or any of its Subsidiaries which may
reasonably be expected to materially adversely affect
the Consignee's, or the Consignee and its Subsidiaries'
taken as a whole, businesses, operations, assets,
revenues, properties or prospects; and
(ii) no development shall have occurred in any
litigation, arbitration or governmental investigation
or proceeding disclosed pursuant to Section 6.7 of the
Revolving Credit Agreement which may reasonably be
expected to materially adversely affect the businesses,
operations, assets, revenues, properties or prospects
of the Consignee or the Consignee and its Subsidiaries,
taken as a whole;
(c) there shall not be any pending or, to the
knowledge of the Consignee, threatened, litigation,
arbitration or governmental investigation or proceeding
which purports to affect the legality, validity or
enforceability of this Agreement or any other Fee
Consignment Document;
(d) the Consignor shall not be prohibited by the
provisions of Section 2.1.2 from making the requested
consignment of Bullion;
(e) no Market Interruption Event shall have occurred
and then be continuing;
(f) the Suppliers parties to the Dollar Supply
Agreement shall have funded the Advances to the
Administrative Agent required in connection with the
requested consignment (provided, that the failure of one or
more Suppliers to fund such Advances shall not relieve the
Consignor from consigning Bullion to the Consignee to the
extent the Administrative Agent has received Advances from
other Suppliers under the Dollar Supply Agreement); and
(g) no Default shall have then occurred and be
continuing, and neither the Consignee nor any of its
Subsidiaries are in material violation of any law or
governmental regulation or court order or decree the
violation of which would have a material adverse effect on
businesses, operations, assets, revenues, properties or
prospects of the Consignee or the Consignee and its
Subsidiaries, taken as a whole.
SECTION V.2.2. Consignment Request. The Consignor shall
have received a Consignment Request for such Consignment. Each
of the delivery of a Consignment Request and the acceptance by
the Consignee of any Bullion to be held by it under consignment
shall constitute a representation and warranty by the Consignee
to the Consignor that on the date of such consignment (both
immediately before and after giving effect to such consignment)
the statements made in clauses (a), (b), (c), (d) and (g) of
Section 5.2.1 are true and correct.
SECTION V.2.3. Continuation of Consignment Period. The
requirement that the Consignor continue to consign to the
Consignee any previously consigned Bullion subject to a maturing
Consignment Period upon the occasion of the expiration of such
Consignment Period is subject to satisfaction of each of the
conditions precedent set forth below:
(a)the Consignee shall not be prohibited by the
provisions of Section 2.1.2 from continuing to hold under
consignment such Bullion;
(b)unless otherwise agreed by the Consignor, no Market
Interruption Event shall have occurred and then be
continuing;
(c)no Consignor Bankruptcy Event shall have occurred;
and
(d)if required pursuant to clause (a) of Section 2.3.1
of the Dollar Supply Agreement, the Suppliers parties to the
Dollar Supply Agreement shall have funded the Advances to
the Administrative Agent required in connection with the
requested continuation (provided, that the failure of one or
more Suppliers to fund such Advances shall not relieve the
Consignor from continuing under consignment Bullion to the
Consignee to the extent the Administrative Agent has
received Advances from other Suppliers under the Dollar
Supply Agreement).
SECTION V.2.4. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto by or on behalf of the
Consignee in connection with such consignment (or continuation,
as the case may be) shall be satisfactory in form and substance
to the Consignor and its counsel; the Consignor and its counsel
shall have received all information, approvals, opinions,
documents or instruments as the Consignor or its counsel may
reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Consignor to enter into this
Agreement and deliver Bullion under consignment to the Consignee
hereunder, the Consignee represents and warrants to the Consignor
as set forth in this Article VI.
SECTION VI.1. Representations and Warranties. The
Consignee hereby represents and warrants to the Consignor that
the representations and warranties contained in Article VI of the
Revolving Credit Agreement are true and correct, each such
representation and warranty set forth in such Article and all
other terms of the Revolving Credit Agreement to which reference
is made therein, together with all related definitions and
ancillary provisions, being hereby incorporated into this
Agreement by reference as though specifically set forth in this
Section; provided, that each reference in such Article to the
"Borrower", the "Administrative Agent", "Obligations", "this
Agreement" and "Loan Documents" and words of similar import shall
be deemed to be a reference to the "Consignee", the "Consignor",
the Obligations hereunder, this Fee Consignment Agreement and the
Fee Consignment Documents, respectively.
SECTION VI.2. Further Representations. In addition to the
representations and warranties set forth above, the Consignee
hereby represents and warrants to the Consignor that (a) the
Consignee has full power and authority to receive and hold
Bullion for the Consignor on the terms and conditions contained
herein and has obtained all necessary governmental consents,
licenses and approvals, if any, that are required to receive and
hold such Bullion, and (b) if this Agreement and the transactions
contemplated hereunder are construed as other than a true
consignment from the Consignor to the Consignee, then this
Agreement creates a valid, first priority security interest in
favor of the Consignor in the Collateral, securing the payment of
the Obligations, and all filings and other actions necessary to
perfect a first priority security interest in favor of the
Consignor in such Collateral have been duly taken in all
applicable jurisdictions.
ARTICLE VII
COVENANTS
In order to induce the Consignor to enter into this
Agreement and deliver Bullion under consignment to the Consignee
hereunder, the Consignee covenants and agrees that until the
Commitment shall have been terminated and all Obligations then
due and outstanding shall have been paid or performed in full and
all Bullion shall have been returned to and/or purchased from the
Consignor, the Consignee shall comply with the covenants as set
forth in this Article VII.
SECTION VII.1. Covenants. The Consignee will perform,
comply with and be bound by all of the agreements, covenants and
obligations contained in Article VII of the Revolving Credit
Agreement, each such agreement, covenant and obligation contained
in such Article and all other terms of the Revolving Credit
Agreement to which reference is made therein, together with all
related definitions and ancillary provisions, being hereby
incorporated into this Agreement by reference as though
specifically set forth in this Section; provided, that each
reference in such Article to the "Borrower", the "Administrative
Agent", "Obligations", "this Agreement" and "Loan Documents" and
words of similar import shall be deemed to be a reference to the
"Consignee", the "Consignor", the Obligations hereunder, this Fee
Consignment Agreement and the Fee Consignment Documents,
respectively.
SECTION VII.2. Additional Covenants. In addition to the
covenants set forth in Section 7.1, the Consignee further
covenants and agrees that it will perform, comply and be bound by
the covenants set forth in this Section.
SECTION VII.2.1. Safekeeping, etc. Until such time as the
Bullion received from the Consignor has been returned to the
Consignor, or purchased pursuant to the terms of this Agreement
by the Consignee, the Consignee will afford the Bullion no less
safekeeping protection than it affords gold and silver held for
its own account, and in any event the Consignor will at all times
be satisfied with the level of such protection. The Consignee
will provide insurance coverage on Bullion held on consignment in
such amounts and covering such risks as is required by the
Consignor and the Consignee shall, upon request, deliver to the
Consignor a copy of all policies for such insurance. Insurance
policies in respect of the Bullion located at the Plants shall
name the Consignor as loss payee and proceeds from such insurance
with respect to Bullion will be paid to the Consignor.
SECTION VII.2.2. Bullion to be Located at Plants. The
Consignee agrees that it will at all times cause all Bullion held
on consignment hereunder and not sold to a customer of the
Consignee to be located only (i) at the Plants, (ii) in transit
between the Plants and/or (iii) in transit to the Consignor;
provided, however, that no sale to any customer of the Consignee
shall be made unless the Consignee shall have first either
purchased or returned a like amount of gold or silver to the
Consignor pursuant to the terms of this Agreement. The Consignee
further agrees that except for U.S. Bullion and Bullion (under and
as defined in this Agreement and the Short-Term Fee Consignment
Agreement), no other gold or silver that is not owned by the
Consignor will be kept in either Plant. In any event, if any gold
or silver (other than U.S. Bullion and Bullion (under and as
defined in this Agreement and the Short-Term Fee Consignment
Agreement) shall at any time be located at either Plant, the
Consignee agrees that such gold and silver shall be transferred (by
book entry or otherwise) as soon as practicable (and in any event
no later than the next Business Day) to another facility of the
Consignee's.
SECTION VII.2.3. Use of Bullion. The Consignee agrees that
it shall use the Bullion held on consignment pursuant to the terms
of this Agreement only in connection with the completion of
customer orders in the ordinary course of business at the Plants.
SECTION VII.2.4. Further Assurances, etc. The Consignee
agrees that, from time to time at its own expense, the Consignee
will promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or
desirable, or that the Consignor may request, in order to perfect,
preserve and protect any of its interest in the Bullion and the
other Collateral and the assignment by the Consignor to the
Administrative Agent contemplated pursuant to clause (b)(i) of
Section 9.10.
SECTION 7.2.5. SEC Filings. On the date of the filing of the
Consignee's next Form 8-K with the Securities and Exchange
Commission, the Consignee shall include a note stating that all
gold and silver (other than the U.S. Bullion) located at each Plant
is owned by the Consignor and held under consignment by the
Consignee.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION VIII.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 8.1
shall constitute an "Event of Default".
SECTION VIII.1.1. Failure to Return Bullion, etc. Failure
by the Consignee (i) to return and/or purchase for cash pursuant
to the terms hereof any amount of Bullion on the date a return or
purchase thereof is required hereunder or (ii) pay any
Consignment Fees, interest or other monetary Obligations, in the
case of this clause (ii) within five days of the date on which it
is due hereunder.
SECTION VIII.1.2. Breach of Warranty. Any representation
or warranty of the Consignee made or deemed to be made hereunder
or in any other Fee Consignment Document or any other writing or
certificate furnished by or on behalf of the Consignee to the
Consignor for the purposes of or in connection with this
Agreement or any such other Fee Consignment Document (including
any certificates delivered pursuant to Article V) is or shall be
incorrect when made in any material respect.
SECTION VIII.1.3. Validity of Security Interest. Any Fee
Consignment Document, or, to the extent the consignments
hereunder are not true consignments from the Consignor to the
Consignee or a Bullion Sale occurs, any Lien granted thereunder,
shall (except in accordance with its terms), in whole or in part,
terminate, cease to be effective or cease to be the legally
valid, binding and enforceable obligation of the Consignee; the
Consignee or any other party shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding
nature or enforceability; or, to the extent the consignments
hereunder are not true consignments from the Consignor to the
Consignee or a Bullion Sale occurs, any Lien securing any
Obligation shall, in whole or in part, cease to be a perfected
first priority Lien in favor of the Consignor and its assigns.
SECTION VIII.1.4. Non-Performance of Other Covenants and
Obligations. The Consignee shall default in the due performance
and observance of any agreement contained herein or in any other
Fee Consignment Document (other than as set forth in Section
8.1.1), and such default shall continue unremedied for a period
of 10 Business Days after notice thereof shall have been given to
the Consignee by the Consignor.
SECTION VIII.1.5. Default on Material Contracts. (a) An
Event of Default under (and as defined in) the Revolving Credit
Agreement or the Short Term Revolving Credit Agreement shall have
occurred and be continuing, (b) an Event of Default under (and as
defined in) the Dollar Supply Agreement or the Short-Term Dollar
Supply Agreement shall have occurred and be continuing or (c) a
default shall occur in the payment when due (subject to any
applicable grace period), whether by acceleration or otherwise,
of any Indebtedness (other than Indebtedness outstanding under
the Revolving Credit Agreement or the Short Term Revolving Credit
Agreement) of the Consignee or any of its Subsidiaries having a
principal amount, individually or in the aggregate, in excess of
$1,000,000, or a default shall occur in the performance or
observance of any obligation or condition with respect to such
Indebtedness if the effect of such default is to accelerate the
maturity of any such Indebtedness or such default shall continue
unremedied for any applicable period of time sufficient to permit
the holder or holders of such Indebtedness, or any trustee or
agent for such holders, to cause such Indebtedness to become due
and payable prior to its expressed maturity.
SECTION VIII.1.6. Bankruptcy, Insolvency, etc. The
Consignee or any of its Subsidiaries (including joint ventures)
shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignee or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignee or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall not
be discharged within 60 days, provided that the Consignee,
each Subsidiary and each joint venture hereby expressly
authorizes the Consignor to appear in any court conducting
any relevant proceeding during such 60-day period to
preserve, protect and defend their rights under the Fee
Consignment Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignee or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Consignee or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in by
the Consignee or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed, provided that the Consignee,
each Subsidiary and each such joint venture hereby expressly
authorizes the Consignor to appear in any court conducting
any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Fee
Consignment Documents; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Consignee, the value of whose assets in
the aggregate for the Fiscal Quarter most recently ended
accounted for an amount equal to or less than 5% of Adjusted
Consolidated Tangible Net Worth.
SECTION VIII.1.7. Consignment Treatment. The consignment
of Bullion pursuant to the terms of this Agreement shall be
characterized as other than a true consignment from the Consignor
to the Consignee (for accounting purposes or as determined by a
court of competent jurisdiction), and such characterization shall
continue for a period of thirty consecutive days.
SECTION VIII.2. Action if Bankruptcy. If any Event of
Default described in clauses (a) through (d) of Section 8.1.6
shall occur, the Commitment (if not theretofore terminated) shall
automatically terminate and the Consignment Maturity Date shall
automatically be accelerated, and all previously delivered
Bullion then held by the Consignee pursuant to the terms hereof
shall be immediately returned to the Consignor, and all monetary
Obligations shall automatically be and become immediately due and
payable, without the requirement of notice or demand by the
Consignor to the Consignee of any kind being necessary.
SECTION VIII.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 8.1.6) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Consignor may by notice to the Consignee demand that all or any
portion of the previously delivered Bullion then held by the
Consignee pursuant to the terms hereof be returned to the
Consignor and/or declare all monetary Obligations to be due and
payable and/or the Commitment (if not theretofore terminated) to
be terminated and the Consignment Maturity Date to be
accelerated, whereupon all or such portion of such Bullion shall
immediately be returned to the Consignor, and the full unpaid
amount of such Obligations which shall be so declared due and
payable shall be and become immediately due and payable, without
further notice, demand or presentment, and/or, as the case may
be, the Commitment shall terminate and the Consignment Maturity
Date shall be accelerated.
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION IX.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Fee Consignment Document may
from time to time be amended, modified or waived, if such
amendment, modification or waiver is in writing and consented to
by the Consignee and the Consignor. No failure or delay on the
part of the Consignor in exercising any power or right under this
Agreement or any other Fee Consignment Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any
such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice
to or demand on the Consignee in any case shall entitle it to any
notice or demand in similar or other circumstances. No waiver or
approval by the Consignor under this Agreement or any other Fee
Consignment Document shall, except as may be otherwise stated in
such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted
hereunder.
SECTION IX.2. Notices. All notices and other
communications provided to any party hereto under this Agreement
or any other Fee Consignment Document shall be in writing or by
facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth below its signature
hereto. Any notice, if mailed and properly addressed with
postage prepaid or if properly addressed and sent by pre-paid
courier service, shall be deemed given when received; any notice,
if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of
transmission.
SECTION IX.3. Payment of Costs and Expenses. The Consignee
agrees to pay on demand all reasonable out-of-pocket expenses of
the Consignor and (without duplication) the Administrative Agent
(including the fees and out-of-pocket expenses of a single
counsel to the Consignor and of local counsel, if any, who may be
retained by counsel to the Consignor and (without duplication)
the Administrative Agent), in connection with
(a) the negotiation, preparation, execution and
delivery of this Agreement and of each other Fee Consignment
Document, the Dollar Supply Agreement and the Short-Term
Dollar Supply Agreement, including in each case schedules
and exhibits, and any amendments, waivers, consents,
supplements or other modifications to this Agreement or any
other Fee Consignment Document, the Dollar Supply Agreement
or the Short-Term Dollar Supply Agreement as may from time
to time hereafter be required, whether or not the
transactions contemplated hereby are consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Fee Consignment Document or the Dollar Supply
Agreement and the Short-Term Dollar Supply Agreement;
(c) the filing, recording, refiling or rerecording of
any Uniform Commercial Code financing statements relating
thereto and all amendments, supplements and modifications to
any thereof and any and all other documents or instruments
of further assurance required to be filed or recorded or
refiled or rerecorded by the terms hereof; and
(d) the administration and monitoring of this
Agreement and the Fee Consignment Documents, the Dollar
Supply Agreement and the Short-Term Dollar Supply Agreement,
and compliance of the parties hereto with respect to the
terms hereof.
The Consignee further agrees to pay on demand (or, in the case of
clause (iii) below, within five days following demand) therefor,
and to save the Consignor harmless from all liability for,
(i) any stamp or other taxes which may be payable in connection
with the execution or delivery of this Agreement or any other Fee
Consignment Document, or the consignment of Bullion hereunder,
(ii) all amounts payable under Article IV hereof, and (iii) all
amounts the Consignor is required to pay or to pay over to the
Suppliers and the Administrative Agent (or would be required to
pay or pay over to the extent first paid by the Consignee
hereunder) under Sections 4.1 through 4.6 (inclusive) and 4.10 of
the Dollar Supply Agreement (but only, in the case of Sections
4.1 and 4.2 and the proviso in Section 4.3 thereof (and in any
event without duplication of the Consignee's Obligation under
clause (b) of Section 3.3.1 hereof), to the extent any such
amount is calculated by reference to a rate equal to the positive
difference, if any, between (x) the Alternate Base Rate from time
to time in effect and (y) a LIBO Rate (Reserve Adjusted) plus 1/2
of 1% per annum (or, if applicable, the Substitute Rate plus 1/2
of 1% per annum) (and the Consignee agrees that, for purposes of
any determination to be made for purposes of Sections 4.1, 4.2,
4.3 or 4.4 of the Dollar Supply Agreement, it shall be
conclusively assumed that each Supplier elected to fund LIBO Rate
Advances by purchasing Dollar deposits in its LIBOR Office's
interbank eurodollar market)), Section 8.3 of the Dollar Supply
Agreement and Section 8.4 of the Dollar Supply Agreement in
respect of all of the Indemnified Liabilities (as defined in
Section 8.4 of the Dollar Supply Agreement), to the extent (and
only to the extent) such Indemnified Liabilities do not result
from a breach by the Consignor of its obligations hereunder or
under the Dollar Supply Agreement, from a Consignor Bankruptcy
Event or from the gross negligence or wilful misconduct of the
Consignor. To the extent that the foregoing undertaking with
respect to the payment of any such Indemnified Liabilities under
Section 8.4 of the Dollar Supply Agreement may be unenforceable
for any reason, the Consignee hereby agrees to make the maximum
contribution to the payment and satisfaction of such Indemnified
Liabilities which is permissible under applicable law. The
Consignee also agrees to reimburse the Consignor upon demand for
all reasonable out-of-pocket expenses (including attorneys' fees
and legal expenses) incurred by the Consignor and (without
duplication) the Administrative Agent in connection with (x) the
negotiation of any restructuring or "work-out", whether or not
consummated, of any Obligations and (y) the enforcement of any
Obligations.
SECTION IX.4. Indemnification. In consideration of the
execution and delivery of this Agreement by the Consignor and the
consignment of Bullion hereunder, the Consignee (without
duplication of any of its other monetary Obligations hereunder)
hereby indemnifies, exonerates and holds the Consignor and its
officers, directors, employees and agents (collectively, the
"Indemnified Parties") free and harmless from and against any and
all actions, causes of action, suits, losses, costs, liabilities
and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to
the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements
(collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out
of, or relating to
(a) the failure of the Consignee for any reason to
return the required amount of Bullion back to the Consignor
on the dates required pursuant to the terms of this
Agreement (whether at the end of a Consignment Period,
following the occurrence of a Market Interruption Event or
otherwise), except to the extent the Consignee has purchased
such Bullion from the Consignor in accordance with the terms
hereof;
(b) the return of any Bullion to the Consignor on
other than the last day of the Consignment Period applicable
to such Bullion;
(c) the failure by the Consignee to pay to the
Consignor any monetary amounts under Sections 3.2, 3.3, 4.5,
8.2, 8.3 or clause (iii) of Section 9.3 hereof which, in
turn, the Consignor is required to pay over to the Suppliers
(notwithstanding that such amounts are only payable by the
Consignor if and to the extent first paid by the Consignee)
under Sections 3.2.3, 3.2.1, 3.2.2, 4.6, 6.2 and 6.3 of the
Dollar Supply Agreement;
(d) any investigation, litigation or proceeding
involving the Consignee or any of its Subsidiaries or
property now or previously owned or leased by the Consignee
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Consignee or any of its
Subsidiaries or the Release by the Consignee or any of its
Subsidiaries of any Hazardous Material; provided, that the
Indemnified Party shall have given the Consignee notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(e) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Consignee or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Consignee or such
Subsidiary;
(f)any breach of warranty contained in Section 6.12 of
the Revolving Credit Agreement (as incorporated by reference
pursuant to Section 6.1 hereof), without giving effect to
the exceptions based upon the materially adverse effect and
any qualification based on materiality or knowledge; or
(g) the entering into and performance of this
Agreement and any other Fee Consignment Document by any of
the Indemnified Parties (including any action brought by or
on behalf of the Consignee as the result of any
determination by the Consignor pursuant to Article V not to
consign Bullion to the Consignee due to the failure of the
Consignee to meet the conditions for such consignment);
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of a
Consignor Bankruptcy Event, or any Indemnified Party's gross
negligence or wilful misconduct or except to the extent (and only
to the extent) the same results from a breach by the Consignor of
its obligations hereunder or under the Dollar Supply Agreement.
If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Consignee hereby agrees to make
the maximum contribution to the payment and satisfaction of each
of the Indemnified Liabilities which is permissible under
applicable law. The Consignor hereby acknowledges and agrees
that the Consignee shall not be liable for any Indemnified
Liabilities arising solely as a result of changes in value of
gold or silver or the method utilized by the Consignor of funding
or procuring the Bullion to be consigned under this Agreement,
except to the extent such Indemnified Liability results from a
Default by the Consignee of its Obligations.
SECTION IX.5. Survival. The obligations of the Consignee
under Sections 4.3, 4.4, 4.5, 4.6, 9.3 and 9.4 shall survive any
termination of this Agreement, the payment in full of all
Obligations, and return to the Consignor of all Bullion and the
termination of the Commitment. The representations and
warranties made by the Consignee in this Agreement and in each
other Fee Consignment Document shall survive the execution and
delivery of this Agreement and each such other Fee Consignment
Document.
SECTION IX.6. Severability. Any provision of this
Agreement or any other Fee Consignment Document which is
prohibited or unenforceable in any jurisdiction shall, as to such
provision and such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Fee Consignment
Document or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION IX.7. Headings. The various headings of this
Agreement and of each other Fee Consignment Document are inserted
for convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Fee Consignment
Document or any provisions hereof or thereof.
SECTION IX.8. Execution in Counterparts, Effectiveness,
etc. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and
the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Consignee and the
Consignor (or notice thereof satisfactory to the Consignor) shall
have been received by the Consignor and notice thereof shall have
been given by the Consignor to the Consignee.
SECTION IX.9. Governing Law; Entire Agreement. THIS
AGREEMENT AND EACH OTHER FEE CONSIGNMENT DOCUMENT SHALL EACH BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. This Agreement and the other Fee
Consignment Documents constitute the entire understanding among
the parties hereto with respect to the subject matter hereof and
supersede any prior agreements, written or oral, with respect
thereto.
SECTION IX.10. Successors and Assigns. This Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns;
provided, however, that:
(a) the Consignee may not assign or transfer its
rights, title, interests or obligations hereunder without
the prior written consent of the Consignor; and
(b) the Consignor may (i) pursuant to Section 4.11 of
the Dollar Supply Agreement and Section 4.11 of the Short-
Term Dollar Supply Agreement, assign its rights, title and
interests (but not its obligations) hereunder (including
with respect to the security interest in the Collateral
granted pursuant to Section 4.2) to the Administrative Agent
(under and as defined in the Dollar Supply Agreement and the
Short-Term Dollar Supply Agreement) for its benefit and the
benefit of the Suppliers (under and as defined in such
agreements), and (ii) at any time assign or transfer all or
any of its rights, title, interests and/or obligations
hereunder, provided (in the case of this clause (b)(ii)),
such assignment or transfer is to its successors or to a
wholly-owned Subsidiary or a branch or agency of the
Consignor.
The Consignee agrees that, subject to the provisions of clause
(e) of Section 8.11.2 of the Dollar Supply Agreement, each
Participant to the Dollar Supply Agreement, for purposes of
Sections 4.3, 4.4, 4.6, 4.8, 4.9, 8.3 and 8.4 thereof, shall be
considered a Supplier.
SECTION IX.11. Forum Selection and Consent to Jurisdiction.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER FEE CONSIGNMENT
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE CONSIGNOR, ANY AGENT,
ANY SUPPLIER OR THE CONSIGNEE SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE CITY AND STATE OF NEW YORK OR IN
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
CONSIGNOR'S OR THE ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY
BE FOUND. THE CONSIGNEE HEREBY EXPRESSLY AND IRREVOCABLY
SUBMITS, FOR ITSELF AND TO THE EXTENT PERMITTED BY APPLICABLE LAW
ITS PROPERTY, TO THE JURISDICTION OF THE COURTS OF THE CITY AND
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. THE CONSIGNEE FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. THE
CONSIGNEE HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
TO THE EXTENT THAT THE CONSIGNEE HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE CONSIGNEE HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER FEE CONSIGNMENT DOCUMENTS.
SECTION IX.12. Waiver of Jury Trial. THE CONSIGNOR AND THE
CONSIGNEE HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON OR BASED, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER FEE CONSIGNMENT
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE CONSIGNOR OR THE
CONSIGNEE. THE CONSIGNEE ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER FEE CONSIGNMENT DOCUMENT
TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE CONSIGNOR ENTERING INTO THIS AGREEMENT AND
EACH SUCH OTHER FEE CONSIGNMENT DOCUMENT AND THE SUPPLIERS AND
THE CONSIGNOR ENTERING INTO THE DOLLAR SUPPLY AGREEMENT AND
ADVANCE DOCUMENTS.
SECTION IX.13. Benefit of this Agreement. The Consignee
acknowledges and agrees that the Administrative Agent and the
Suppliers are third-party beneficiaries of clause (iii) of the
last paragraph of Section 9.3 of this Agreement.
SECTION IX.14. Settlement Amount. If a judgment in Dollars
(instead of specific performance) is entered against the
Consignee with respect to the Consignee's failure to return all
or a portion of Bullion (or other gold or silver) in the amounts
and on the dates required pursuant to this Agreement, and the
amount of Dollars so awarded is less than the sum of (i) the
Dollar Value of gold multiplied by the number of ounces of such
unreturned gold and/or (ii) the Dollar Value of silver multiplied
by the number of ounces of such unreturned silver, in each case
as in effect three Business Days prior to the first day of the
Consignment Periods then in effect for such unreturned Bullion
(the "Settlement Amount"), then the Consignee agrees that it
shall pay to the Consignor the difference between the Settlement
Amount and the amount of Dollars awarded pursuant to such
judgment.
SECTION IX.15. Waiver of Immunity. To the extent that the
Consignor may have any immunity on the grounds of sovereignty or
otherwise from jurisdiction of any court in the United States or
from any legal process (whether through service or notice,
attachment prior to judgment, attachment in aid of execution or
otherwise) or from any legal proceeding with respect to itself or
its property, the Consignor hereby irrevocably waives such
immunity for itself and its property (including, without
limitation, property held by the Consignor for its own account)
with respect to its obligations under this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Title: Vice President and Treasurer
Address: 250 Park Avenue
New York, New York 10177
Facsimile No.: 212-309-0682
Attention: Mr. Stephen B. Mudd
Vice President and Treasurer
THE BANK OF NOVA SCOTIA
By: /s/ Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
With a copy to:
Address: The Bank of Nova Scotia
Scotia Plaza
44 King Street West
Toronto, Ontario
Canada M5H 1H1
Facsimile No.: 416-866-4053
Attention: Peter Payne
EXHIBIT 10.6
EXECUTION COPY
110,000 TROY OUNCES (GOLD)
11,250,000 TROY OUNCES (SILVER)
SHORT-TERM FEE CONSIGNMENT AGREEMENT,
dated as of September 28, 1994,
between
HANDY & HARMAN,
as the Consignee
and
THE BANK OF NOVA SCOTIA,
as the Consignor.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . .
ARTICLE II
COMMITMENT; CONSIGNMENT PROCEDURES
2.1. Commitment and Consignment Procedures . . . . . .
2.1.1. Commitment . . . . . . . . . . . . . . . . . . .
2.1.2. Consignor Not Permitted or Required to Consign or
Continue Under Consignment Bullion . . . . . .
2.2. Reduction of Commitment Amount . . . . . . . . .
2.2.1. Optional Reduction of Commitment Amount . . . . .
2.2.2. Mandatory Reduction of Commitment Amount . . . .
2.3. Consignment Procedure; Delivery of Bullion . . .
2.3.1. Continuation and Return Elections . . . . . . . .
2.3.2. Quality . . . . . . . . . . . . . . . . . . . . .
2.3.3. Title and Purchase Price of Bullion. . . . . . .
2.4. Extension of Consignment Maturity Date . . . . .
2.4.1. Request for Extension of Consignment Maturity
Date . . . . . . . . . . . . . . . . . . . . .
2.4.2. Consent to Extension . . . . . . . . . . . . . .
ARTICLE III
RETURN OF BULLION; POST-MATURITY RATES; FEES
3.1. Return of Bullion . . . . . . . . . . . . . . . .
3.1.1. Consignment Maturity Date . . . . . . . . . . . .
3.1.2. Voluntary Return of Bullion . . . . . . . . . . .
3.1.3. Mandatory Return of Bullion . . . . . . . . . . .
3.1.4. Acceleration of Consignment Maturity Date . . . .
3.2. Post-Maturity Rates, etc . . . . . . . . . . . .
3.3. Fees . . . . . . . . . . . . . . . . . . . . . .
3.3.1. Consignment Fee . . . . . . . . . . . . . . . . .
3.3.2. Commitment Fee . . . . . . . . . . . . . . . . .
3.3.3. Other Fees . . . . . . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN OTHER PROVISIONS; SECURITY INTEREST
4.1. Consignments, etc. Unlawful . . . . . . . . . . .
4.2. Security Interest . . . . . . . . . . . . . . . .
4.3. Losses . . . . . . . . . . . . . . . . . . . . .
4.4. Increased Costs . . . . . . . . . . . . . . . . .
4.5. Taxes . . . . . . . . . . . . . . . . . . . . . .
4.6. Payments, Computations, etc. . . . . . . . . . .
ARTICLE V
CONDITIONS TO CONSIGNMENTS
5.1. Initial Consignment . . . . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . . .
5.1.2. Delivery of Financing Statements, etc . . . . . .
5.1.3. Delivery of Waiver and Consent or Amendment . . .
5.1.4. Opinions of Counsel . . . . . . . . . . . . . . .
5.1.5. Closing Fees, Expenses, etc. . . . . . . . . . .
5.2. All Deliveries under Consignment . . . . . . . .
5.2.1. Compliance with Warranties, No Default, etc. . .
5.2.2. Consignment Request . . . . . . . . . . . . . . .
5.2.3. Continuation of Consignment Period . . . . . . .
5.2.4. Satisfactory Legal Form . . . . . . . . . . . . .
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Representations and Warranties . . . . . . . . .
6.2. Further Representations . . . . . . . . . . . . .
ARTICLE VII
COVENANTS
7.1. Covenants . . . . . . . . . . . . . . . . . . . .
7.2. Additional Covenants . . . . . . . . . . . . . .
7.2.1. Safekeeping, etc . . . . . . . . . . . . . . . .
7.2.2. Bullion to be Located at Plants . . . . . . . . .
7.2.3. Use of Bullion . . . . . . . . . . . . . . . . .
7.2.4. Further Assurances, etc. . . . . . . . . . . . .
7.2.5. SEC Filings . . . . . . . . . . . . . . . . . . .
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . .
8.1.1. Failure to Return Bullion, etc. . . . . . . . . .
8.1.2. Breach of Warranty . . . . . . . . . . . . . . .
8.1.3. Validity of Security Interest . . . . . . . . . .
8.1.4. Non-Performance of Other Covenants and
Obligations . . . . . . . . . . . . . . . . . .
8.1.5. Default on Material Contracts . . . . . . . . . .
8.1.6. Bankruptcy, Insolvency, etc. . . . . . . . . . .
8.1.7. Consignment Treatment . . . . . . . . . . . . . .
8.2. Action if Bankruptcy . . . . . . . . . . . . . .
8.3. Action if Other Event of Default . . . . . . . .
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.1. Waivers, Amendments, etc. . . . . . . . . . . . .
9.2. Notices . . . . . . . . . . . . . . . . . . . . .
9.3. Payment of Costs and Expenses . . . . . . . . . .
9.4. Indemnification . . . . . . . . . . . . . . . . .
9.5. Survival . . . . . . . . . . . . . . . . . . . .
9.6. Severability . . . . . . . . . . . . . . . . . .
9.7. Headings . . . . . . . . . . . . . . . . . . . .
9.8. Execution in Counterparts, Effectiveness, etc. .
9.9. Governing Law; Entire Agreement . . . . . . . . .
9.10. Successors and Assigns . . . . . . . . . . . . .
9.11. Forum Selection and Consent to Jurisdiction . . .
9.12. Waiver of Jury Trial . . . . . . . . . . . . . .
9.13. Benefit of this Agreement . . . . . . . . . . . .
9.14. Settlement Amount . . . . . . . . . . . . . . . .
9.15. Waiver of Immunity . . . . . . . . . . . . . . .
EXHIBIT A Form of Consignment Request
EXHIBIT B Form of Continuation/Return Request
EXHIBIT C Form of Consignment Extension Request
EXHIBIT D Form of Opinion of General Counsel to the Consignee
EXHIBIT E Form of Opinion of New York Counsel to the
Consignee
EXHIBIT F Form of Opinion of Connecticut Counsel to
the Consignor
EXHIBIT G Form of Opinion of Rhode Island Counsel to
the Consignee
EXHIBIT H Form of Opinion of Auditors to the Consignee
SHORT-TERM FEE CONSIGNMENT AGREEMENT
THIS SHORT-TERM FEE CONSIGNMENT AGREEMENT, dated as of
September 28, 1994, between HANDY & HARMAN, a New York
corporation (the "Consignee") and THE BANK OF NOVA SCOTIA (the
"Consignor"),
W I T N E S S E T H:
WHEREAS, the Consignee is engaged directly and through its
various Subsidiaries (such capitalized term, and other terms used
in these recitals, to have the meanings set forth in Section 1.1,
below) in the businesses described in the Consignee's Annual
Report on Form 10-K for the 1993 Fiscal Year;
WHEREAS, the Consignee desires to obtain the Commitment from
the Consignor pursuant to which the Consignor will from time to
time prior to the Commitment Termination Date consign up to
110,000 troy ounces of gold and up to 11,250,000 troy ounces of
silver (such gold and silver collectively referred to as the
"Bullion"), with the Bullion at all times to be located, except
as otherwise set forth herein, only at the Plants;
WHEREAS, the Consignor is willing, on the terms and subject
to the conditions hereinafter set forth (including Article V), to
extend the Commitment to consign the Bullion to the Consignee;
and
WHEREAS, the Bullion consigned to the Consignee will be used
at either one of the Plants in the production and fabrication of
products for customers of the Consignee in the ordinary course of
business;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"ABR Fee" is defined in Section 3.2.
"Agreement" means, on any date, this Short-Term Fee
Consignment Agreement as originally in effect on the Effective
Date and as thereafter from time to time amended, supplemented,
amended and restated, or otherwise modified and in effect on such
date.
"Authorized Officer" means those officers of the Consignee
whose signatures and incumbency shall have been certified to the
Consignor pursuant to Section 5.1.1.
"Bullion" is defined in the second recital.
"Bullion Sale" is defined in Section 4.2.
"Collateral" is defined in Section 4.2.
"Commitment" is defined in Section 2.1.1.
"Commitment Amount" means, on any day,
(a) with respect to gold, (i) 110,000 troy ounces of
gold or, if less, (ii) the maximum number of troy ounces of
gold obtained by dividing (A) $52,250,000 (or, if, on or
prior to such day, the Advance Commitment Amount is reduced
pursuant to the terms of the Short-Term Dollar Supply
Agreement, a Dollar amount equal to the product of (x) the
Advance Commitment Amount (after giving effect to any
reduction thereto on or prior to such day) and
(y) 41.6749751%), by (B) $475 (rounded down to the next
whole number); and
(b) with respect to silver, (i) 11,250,000 troy ounces
of silver or, if less, (ii) the maximum number of troy
ounces of silver obtained by dividing (A) $73,125,000 (or,
if, on or prior to such day, the Advance Commitment Amount
is reduced pursuant to the terms of the Short-Term Dollar
Supply Agreement, a Dollar amount equal to the product of
(x) the Advance Commitment Amount (after giving effect to
any reduction thereto on or prior to such day) and
(y) 58.3250249%), by (B) $6.50 (rounded down to the next
whole number);
as the amounts in clauses (a)(i) and (b)(i) above may be reduced
from time to time pursuant to Section 2.2 or as required in
accordance with the proviso contained in clause (b) of Section
2.4.2.
"Commitment Termination Date" means the earliest of
(a) the Consignment Maturity Date;
(b) the date on which the Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2;
(c) the occurrence of any Default described in clauses
(a) through (d) of Section 8.1.6;
(d) the occurrence and continuance of any other Event
of Default and either
(i) the declaration by the Consignor that the
Bullion is to be returned to it from consignment
pursuant to Section 8.3, or
(ii) in the absence of such declaration, the
giving of notice by the Consignor to the Consignee that
the Commitment has been terminated; and
(e) the occurrence of any Consignor Bankruptcy Event.
Upon the occurrence of any event described in clause (b), (c) or
(e) the Commitment shall terminate automatically and without
further action.
"Consignee" is defined in the preamble.
"Consignment Extension Request" means an extension request
duly executed by an Authorized Officer, substantially in the form
of Exhibit C hereto.
"Consignment Fee" is defined in clause (a) of Section 3.3.1.
"Consignment Maturity Date" means September 26, 1995, as
such date may be extended pursuant to Section 2.4.
"Consignment Period" means, with respect to other than Swing
Line Consignments, the period beginning on (and including) the
date on which any amount of Bullion is consigned (or, in the case
of previously consigned Bullion, the date on which the
consignment of such Bullion (or any portion thereof) is continued
in accordance with a Continuation/Return Notice) by the Consignor
to the Consignee pursuant to the terms of this Agreement and
shall end on (but exclude) the day which numerically corresponds
to such date one, two or three months (or such other period, if
agreed to by the Consignor) thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such
month), as the Consignee may select in its relevant notice
pursuant to Section 2.3 or 2.3.1; provided, however, that
(a) Consignment Periods commencing on the same date
for consignments of Bullion comprising part of the same
consignment shall be of the same duration,
(b) if such Consignment Period would otherwise end on
a day which is not a Business Day, such Consignment Period
shall end on the next following Business Day; provided,
however, that if such next following Business Day is the
first Business Day of a calendar month, such Consignment
Period shall end on the next preceding Business Day, and
(c) no Consignment Period may end later than the
Consignment Maturity Date.
No more than ten Consignment Periods shall be in effect at any
one time.
"Consignment Request" means a request executed and delivered
by the Consignee in connection with the making of a consignment
of Bullion in the form of Exhibit A hereto.
"Consignor" is defined in the preamble.
"Contango Fee" means, with respect to any day, the
difference between the LIBO Rate (Reserve Adjusted) for a one
month Funding Period commencing on such day minus the Gold Rate
(in the case of consignments of gold) or the Silver Rate (in the
case of consignments of silver), in each case for a one month
Consignment Period commencing on such day.
"Continuation/Return Notice" means a notice of continuation
of consignment or return of all of a portion of Bullion
previously consigned hereunder to the Consignee duly executed by
an Authorized Officer, substantially in the form of Exhibit B
attached hereto.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Dollar Supply Agreement" means the Dollar Supply Agreement,
dated as of the date hereof (as amended, supplemented, amended
and restated or otherwise modified from time to time pursuant to
the terms thereof), among the Consignor, certain financial
institutions (the "Suppliers") from time to time parties thereto,
Chemical, BONY and Scotiabank as the co-agents for the Suppliers
and Scotiabank as the administrative agent for the Suppliers.
"Dollar Value of gold" means, as of any day of
determination, the value in Dollars of one troy ounce of gold as
determined by reference to the daily London Afternoon Fixing
Price for gold on such day. In the event there is no London
Afternoon Fixing Price for gold on a particular day, the last
established London Afternoon Fixing Price for gold shall apply;
provided, however that in the event such last established London
Afternoon Fixing Price is less than the Consignor's cost of
acquiring gold in the precious metals markets as of such day,
then the "Dollar Value of gold" as of such day shall equal the
Consignor's cost of gold in such markets as of such day, as
notified to the Consignee by the Consignor.
"Dollar Value of silver" means, as of any day of
determination, the value in Dollars of one troy ounce of silver
as determined by reference to the Silver Fixing Price for silver
on such day. In the event there is no Silver Fixing Price for
silver on a particular day, the last established Silver Fixing
Price for silver shall apply; provided, however, that in the
event such last established Silver Fixing Price is less than the
Consignor's cost of acquiring silver in the precious metals
markets as of such day, then the "Dollar Value of silver" as of
such day shall equal the Consignor's cost of silver in such
markets as of such day, as notified to the Consignee by the
Consignor.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 9.8.
"Event of Default" is defined in Section 8.1.
"Fee Consignment Agreement" means the Fee Consignment
Agreement, dated as of the date hereof, between the Consignor and
the Consignee, as amended, supplemented, amended and restated or
otherwise modified from time to time pursuant to the terms
thereof.
"Fee Consignment Document" means this Agreement, each
Consignment Request, each Consignment Extension Request and each
Continuation/Return Request.
"Fee Letter" is defined in the Revolving Credit Agreement.
"gold" means gold in London Good Delivery bar form, loco
London, England, and of a minimum fineness of .995, unless
otherwise mutually agreed to by the Consignor and Consignee in
advance of delivery to the Consignee.
"Gold Rate" means, with respect to any Consignment Period,
the arithmetic mean rate for the relevant Consignment Period as
shown on Reuters LIBO screen as at 10:00 a.m. London, England
time three Business Days prior to the first day of the
Consignment Period, less the mean rate shown on such date on the
Reuters GOFO page as at 10:00 a.m. London, England time;
provided, however, that in the event the Consignor determines
prior to the commencement of such Consignment Period that the
rate (as computed from the LIBO and GOFO Reuters pages set forth
in the preceding sentence) does not reflect the rate at which it
is prepared to provide consignments of gold for the relevant
Consignment Period, then the "Gold Rate" for such Consignment
Period shall be the rate, if any, which the Consignor notifies
the Consignee prior to the commencement of such Consignment
Period as the rate at which the Consignor is prepared to provide
consignments of a similar nature.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Fee Consignment Document
refer to this Agreement or such other Fee Consignment Document,
as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Fee
Consignment Document.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Fee Consignment Document, the parties
hereto agree that the rule of ejusdem generis shall not be
applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters or to matters
specifically mentioned.
"Indemnified Liabilities" is defined in Section 9.4.
"Indemnified Parties" is defined in Section 9.4.
"London Afternoon Fixing Price" shall mean the London
Afternoon Fixing Price, as determined by The London Bullion
Market Association.
"London Good Delivery" has the meaning ascribed thereto by
The London Bullion Market Association.
"Market Interruption Event" means the occurrence of an event
which (i) is not within the control of the Consignor or
attributable to any act of, or failure to act by, the Consignor,
and (ii) at any time causes the Consignor to be unable to conduct
transactions in any accessible international gold or silver
market sufficient to make, maintain or continue, in whole or in
part, any of the consignments of Bullion hereunder, including the
following:
(a) changes in national or international financial,
political or economic conditions;
(b) wars, strikes, or acts of God;
(c) acts of government or any governmental activity;
or
(d) a change in law or regulation (by governmental or
other regulatory authority, whether or not having the force
of law) or the interpretation thereof which has the effect
of making it illegal or impractical for the Consignor to
engage in the consignment of Bullion.
"Obligations" means all obligations (monetary or otherwise)
of the Consignee arising under or in respect of this Agreement
and each other Fee Consignment Document, including the
obligations of the Consignee to return or purchase Bullion
pursuant to the terms hereof.
"Organic Document" means, relative to the Consignee, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Plant" means, as the context may require, either the
Consignee's fabrication facility located at 1770 Kings Highway,
Fairfield, Connecticut or at 231 Ferris Avenue, East Providence,
Rhode Island.
"Processed Bullion" means an undivided interest in each
product of any goods and inventory containing gold and/or silver
located at either Plant or for which gold and/or silver located
at either Plant comprises a part thereof, which undivided
interest shall be, with respect to any such product, equal to the
ratio that the cost of such gold and/or silver (other than U.S.
Bullion) contained in such product or comprising a part thereof
bears to the cost of such product. Terms defined in the U.C.C.
and used in this definition have the meanings set forth in the
U.C.C.
"Revolving Credit Agreement" means the Revolving Credit
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof), among the Consignee, certain
financial institutions from time to time parties thereto,
Chemical, BONY and Scotiabank as co-agents and Scotiabank, as the
administrative agent; provided that if the Revolving Credit
Agreement shall be refinanced or otherwise terminated and is no
longer of force and effect at a time when this Agreement is still
in effect, then, for purposes of this Agreement, the "Revolving
Credit Agreement" shall mean the Revolving Credit Agreement, as
in effect immediately prior to the date of such refinancing or
termination.
"Settlement Amount" is defined in Section 9.14.
"Short-Term Dollar Supply Agreement" means the Short-Term
Dollar Supply Agreement, dated as of the date hereof (as amended,
supplemented, amended and restated or otherwise modified from
time to time pursuant to the terms thereof), among the Consignor,
the Suppliers from time to time parties thereto, Chemical, BONY
and Scotiabank as co-agents for the Suppliers and Scotiabank, as
the administrative agent for the Suppliers.
"silver" means silver in London Good Delivery bar form, loco
London, England, and of a minimum fineness of .999, unless
otherwise mutually agreed to by the Consignor and the Consignee
in advance of delivery to the Consignee.
"Silver Fixing Price" means the Silver Fixing Price, as
determined by The London Silver Market Association.
"Silver Rate" means, with respect to any Consignment Period,
the rate that the Consignor notifies the Consignee prior to the
commencement of such Consignment Period as the rate which the
Consignor is prepared to provide funding for consignments of
silver of a similar nature for the relevant Consignment Period.
"Swing Line Consignments" is defined in Section 2.3.
"Swing Line Commitment Amount" means, as of any day, the
maximum number of troy ounces of gold and silver (or any
combination of gold and silver) that is obtained by dividing
$10,000,000 by the then existing Dollar Value of gold or Dollar
Value of silver (or both, if applicable).
"Taxes" is defined in Section 4.5.
"U.C.C." means the Uniform Commercial Code, as in effect in
the State of New York from time to time.
"U.S. Bullion" means gold or silver of any quality or
fineness owned by the U.S. federal government and located from
time to time at the Plants (or either one of them).
SECTION 1.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires,
(a) terms for which meanings are provided in (or by
reference in) this Agreement shall have such meanings when
used in any Fee Consignment Document, notice and other
communication delivered from time to time in connection with
this Agreement or any other Fee Consignment Document; and
(b) terms used in this Agreement or any Fee
Consignment Document that are not defined herein (or in such
Fee Consignment Document) are used herein (or in such Fee
Consignment Document) with the meanings set forth in the
Short-Term Dollar Supply Agreement.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Fee Consignment
Document to any Article or Section are references to such Article
or Section of this Agreement or such other Fee Consignment
Document, as the case may be, and, unless otherwise specified,
references in any Article, Section or definition to any clause
are references to such clause of such Article, Section or
definition.
ARTICLE II
COMMITMENT; CONSIGNMENT PROCEDURES
SECTION 2.1. Commitment and Consignment Procedures. The
terms pursuant to which the Consignor will from time to time
deliver Bullion to be held under consignment by the Consignee or
continue to consign Bullion under consignment at the end of a
Consignment Period are as set forth in Sections 2.1.1 and 2.1.2,
below.
SECTION 2.1.1. Commitment. On the terms and subject to the
conditions of this Agreement (including Article V), the Consignor
agrees from time to time on any Business Day occurring prior to
the Commitment Termination Date to deliver Bullion that will be
held on consignment by the Consignee in an aggregate amount (not
in excess of the Commitment Amount) as requested by the
Consignee. The commitment of the Consignor described in this
Section 2.1.1 is herein referred to as its "Commitment". On the
terms and subject to the conditions hereof, the Consignee may
from time to time prior to the Commitment Termination Date have
Bullion consigned to it, continue to hold under consignment all
or a portion of such Bullion, return all or a portion of such
Bullion from consignment to the Consignor and/or purchase all or
a portion of such Bullion, and thereafter have Bullion consigned
to it again.
SECTION 2.1.2. Consignor Not Permitted or Required to
Consign or Continue Under Consignment Bullion. The Consignor
shall not be permitted or required to deliver any Bullion to be
held under consignment pursuant to the terms of this Agreement,
nor will the Consignor be required to continue to consign to the
Consignee at the end of any Consignment Period pursuant to
Section 2.3.1 Bullion then subject to such maturing Consignment
Period, to the extent (and only to the extent) that
(a) in the case of gold, after giving effect to the
requested consignment or continuation, the number of troy
ounces of gold consigned under this Agreement (including any
Swing Line Consignments) would exceed the Commitment Amount
then in effect relating to gold, as set forth in the
definition of "Commitment Amount";
(b) in the case of silver, after giving effect to the
requested consignment or continuation, the number of troy
ounces of silver consigned under this Agreement (including
any Swing Line Consignments) would exceed the Commitment
Amount then in effect relating to silver, as set forth in
the definition of "Commitment Amount"; or
(c) the Dollar Value of gold and the Dollar Value of
silver (as applicable) on (i) the date of the applicable
Consignment Request (in the case of Swing Line Consignments)
or (ii) three Business Days prior to the first day of the
then requested Consignment Period or continuation of such
Consignment Period (in the case of consignments of Bullion
(or continuations of previously consigned Bullion) other
than Swing Line Consignments multiplied by the number of
troy ounces of gold and silver that is and will be consigned
under this Agreement, after giving effect to all
consignments of gold and silver requested on such date, and
any previous days (to the extent the gold and silver
previously requested has not yet been delivered under
consignment to the Consignee) on the date of the requested
consignment, would exceed the Advance Commitment Amount then
in effect under the Short-Term Dollar Supply Agreement.
SECTION 2.2. Reduction of Commitment Amount. The
Commitment Amount is subject to reduction from time to time
pursuant to this Section 2.2.
SECTION 2.2.1. Optional Reduction of Commitment Amount.
The Consignee may, from time to time on any Business Day
occurring after the Effective Date, voluntarily reduce the
Commitment Amount; provided, however, that
(a) all such reductions shall require at least five
Business Days' prior written irrevocable notice to the
Consignor and be permanent;
(b) any partial reduction of the Commitment Amount
shall be in a minimum number of ounces of Bullion that
equals at least $10,000,000, based on the value of a troy
ounce of gold equalling $475, and a troy ounce of silver
equalling $6.50;
(c) the Commitment Amount of gold or silver may not be
so reduced to an amount less than the then aggregate number
of troy ounces of gold or silver (as the case may be) then
held under consignment (including any Swing Line
Consignments) pursuant to the terms of this Agreement by the
Consignee; and
(d) the Commitment Amount may only be reduced to zero
if, prior to or at the time of and as a condition to such
reduction, the Consignee shall have repaid in full all then
accrued and outstanding monetary Obligations and shall have
returned to the Consignor or purchased from the Consignor
pursuant to the terms of this Agreement all Bullion
previously consigned pursuant to the terms of this
Agreement.
SECTION 2.2.2. Mandatory Reduction of Commitment Amount.
The Commitment Amount shall be permanently reduced on the date of
any permanent reduction in the Advance Commitment Amount as a
result of the operation of Section 2.4.2 of the Short-Term Dollar
Supply Agreement by a number of troy ounces of Bullion equal to
(a) in the case of gold, the quotient obtained by
dividing (i) the product of (x) the Advance Commitment
Amount (after giving effect to any such reduction) and
(y) 41.6749751% by (ii) $475 (rounded down to the next whole
number); and
(b) in the case of silver, the quotient obtained by
dividing (i) the product of (x) the Advance Commitment
Amount (after giving effect to any such reduction) and
(y) 58.3250249%, by (ii) $6.50 (rounded down to the next
whole number).
SECTION 2.3. Consignment Procedure; Delivery of Bullion.
The procedures for the consignment of Bullion under this
Agreement are set forth in this Section.
(a) This clause (a) shall govern consignments of
Bullion other than Swing Line Consignments. By delivering a
Consignment Request to the Consignor at or before 5:00 p.m.
(New York City time), on a Business Day, the Consignee may
from time to time irrevocably request, on not less than four
nor more than five Business Days' notice, that a consignment
of Bullion be made by the Consignor in a number of ounces of
gold and/or silver such that the sum of the aggregate Dollar
Value of gold as of the date of such Consignment Request for
all gold subject to such Consignment Request plus the
aggregate Dollar Value of silver (as applicable) as of the
date of such Consignment Request for all silver subject to
such Consignment Request equals or exceeds $10,000,000 or,
if less, in the unutilized amount of the Commitment Amount
for gold and/or silver, as applicable.
(b) This clause (b) shall govern the consignment of
Bullion for Swing Line Consignments. By written or
telephonic notice to the Consignor on or before 11:00 a.m.
(New York City time) on a Business Day the Consignee may
from time to time request that a consignment of Bullion
(referred to as a "Swing Line Consignment") be made by the
Consignor on such Business Day, or the next succeeding
Business Day, in a number of ounces that does not exceed the
Swing Line Commitment Amount (after giving effect to the
number of ounces of Bullion still held under consignment by
the Consignee as a result of previous Swing Line
Consignments) as of the date of such request. All
telephonic notices shall be confirmed on the same Business
Day by the delivery to the Consignor of an appropriately
completed Consignment Request.
(c) In the case of all consignments of Bullion
(including Swing Line Consignments) the Consignor will
arrange for the delivery of the Bullion to the applicable
Plant (but only to such Plants) in the amounts and types of
Bullion requested for such Plant in the Consignment Request
on the date for delivery set forth in the Consignment
Request. The Consignor will assume all risk of loss or
damage to the Bullion until it has been delivered to the
applicable Plant, at which time such risk shall pass to the
Consignee, and unless the Consignee notifies the Consignor
within one day following delivery of such Bullion that such
Bullion is damaged, or does not conform to the quality or
fineness of Bullion requested to be delivered under
consignment, then such Bullion delivered to the Consignee
shall be deemed to be not damaged and to conform with the
quality and fineness so requested by the Consignee. Any
Bullion delivered to the Consignee that is damaged or that
does not conform to the quality and fineness of the
requested Bullion shall be immediately delivered back to the
Consignor by the Consignee. In the case of the return of
Bullion to the Consignor from the Consignee, all deliveries
of Bullion will be made in accordance with the directions of
the Consignor at such address as the Consignor may direct in
a written notice to the Consignee. The Consignee shall bear
the cost of such delivery. The Consignee will assume all
risk of loss or damage to the Bullion until it has been
delivered to the Consignor, at which time such risk shall
pass to the Consignor.
SECTION 2.3.1. Continuation and Return Elections. By
delivering a Continuation/Return Notice to the Consignor at or
before 5:00 p.m. (New York City time) on a Business Day that is
at least four but no more than five Business Days prior to the
expiration of a Consignment Period, the Consignee may from time
to time irrevocably elect that either (a) all Bullion subject to
such Consignment Period either remain under consignment from the
Consignor hereunder for such Consignment Periods as are selected
by the Consignee (and the Consignee shall be permitted to include
in a continuation of Bullion for the next selected Consignment
Period Bullion that was consigned pursuant to one or more Swing
Line Consignments) in such Continuation/Return Request or be
returned to the Consignor, or (b) that only a portion of the
Bullion subject to such Consignment Period remain under
consignment from the Consignor hereunder for such Consignment
Periods as are selected by the Consignee in such
Continuation/Return Request and that the remainder of such
Bullion be returned to and/or purchased from the Consignor;
provided, that the amount of Bullion, if any, to be subject to
the Consignment Periods requested in such Continuation/Return
Request, and the amount of Bullion, if any, elected to be
returned and/or purchased pursuant to such Continuation/Return
Request, shall have, in each case (unless the Consignee has
elected that all of the Bullion subject to such maturing
Consignment Period be continued hereunder for new Consignment
Periods or that all such Bullion be returned), an aggregate
Dollar Value of gold or Dollar Value of silver (as applicable),
or combination thereof, in each case as of the date of such
Continuation/Return Notice, equal to or greater than $10,000,000.
In addition, all Bullion that is held under Swing Line
Consignments three Business Days prior to any continuation of
consignments at the end of a Consignment Period shall, unless the
Consignee has notified the Consignor that such Bullion is to
remain under a Swing Line Consignment or be returned to the
Consignor, be included as additional Bullion under consignment
for the next Consignment Period. In the absence of delivery of a
Continuation/Return Notice with respect to any then maturing
Consignment Period at least four but no more than five Business
Days prior to the last day of the then current Consignment Period
with respect thereto, the Consignee shall be deemed, subject to
satisfaction of the conditions set forth in Section 5.2.3, to
have requested that the entire amount (or such lesser amount as
may be otherwise permitted pursuant to the terms hereof) of
Bullion that was consigned in connection with the then maturing
Consignment Period and all Bullion held under Swing Line
Consignments three Business Days prior to the first day of the
immediately succeeding Consignment Period remain consigned
hereunder for a Consignment Period of one month. All Bullion
initially consigned pursuant to a Swing Line Consignment that
becomes subject to a Consignment Period shall no longer be
considered to be consigned pursuant to a Swing Line Consignment.
SECTION 2.3.2. Quality. Gold and silver delivered to the
Consignee and returned to the Consignor shall in each case be of
the quality set forth in the definition of "gold" and of
"silver", respectively.
SECTION 2.3.3. Title and Purchase Price of Bullion. Title
to the Bullion delivered on consignment by the Consignor
hereunder will remain with the Consignor and will not pass to the
Consignee. To the extent that any Bullion (or a portion of
Bullion) is purchased by the Consignee pursuant to the terms of
this Agreement, then title only to such Bullion (or such portion
of Bullion) will transfer to the Consignee. If the Consignee
wishes to purchase part or all of the Bullion held on consignment
from the Consignor, an Authorized Officer of the Consignee will
make a request to the Consignor stating the number of ounces of
Bullion and the quality of Bullion to be purchased and the
proposed date of the purchase. At the Consignor's sole option
and only if it desires to enter into the requested sale, the
Consignor shall at least two Business Days prior to the proposed
date for such purchase (or such lesser number of days as the
Consignor and the Consignee may agree), provide an Authorized
Officer of the Consignee with a quotation of the price at which
the Consignor is willing to sell the Bullion to the Consignee
multiplied by the number of ounces of Bullion to be purchased.
If such price is agreed to in a written notice by the Consignee
to the Consignor, such Bullion will thereupon be conclusively
deemed to have been contracted for purchase, with payment of the
purchase price by the Consignee to be made in cash on the date
agreed to by the Consignor and the Consignee (and the Consignee
agrees that in any event payment in cash to the Consignor for any
purchase of Bullion in respect of a specific Consignment Period
shall be made to the Consignor on or before the last day of such
Consignment Period). Title to the Bullion purchased by the
Consignee as provided above will pass to the Consignee only upon
receipt by the Consignor in immediately available funds of the
total purchase price due from the Consignee as payment for the
Bullion purchased.
SECTION 2.4. Extension of Consignment Maturity Date. The
Consignment Maturity Date shall be subject to extension as set
forth in this Section.
SECTION 2.4.1. Request for Extension of Consignment
Maturity Date. Any term or provision of this Agreement to the
contrary notwithstanding, not earlier than 60 days nor later than
45 days prior to the then existing Consignment Maturity Date (if
the Commitment then remains in effect), the Consignee may, by
delivery of a duly completed Consignment Extension Request to the
Consignor, irrevocably request that the Consignor extend for a
period not in excess of 364 days the then existing Consignment
Maturity Date.
SECTION 2.4.2. Consent to Extension. (a) The Consignor
shall, within 35 days of receipt of the notice described in
Section 2.4.1, notify the Consignee whether or not it consents to
the Consignee's request set forth in such Consignment Extension
Request, such consent to be in the sole discretion of the
Consignor. If the Consignor does not so notify the Consignee of
its decision within such 35 day period, then the Consignor shall
be deemed not to have consented to such request of the Consignee.
(b) Notwithstanding anything to the contrary contained in
this Section, the Consignment Maturity Date shall not be extended
for an additional period unless, in addition to the receipt of an
approval by the Consignor to extend such date pursuant to clause
(a) above, Suppliers whose Percentages equal or exceed 75% of the
Advance Commitment Amount under the Short-Term Dollar Supply
Agreement (after giving effect to the operation of clause (c) of
Section 2.4.2 of the Short-Term Dollar Supply Agreement) have
also so consented to an extension of the Stated Maturity Date in
accordance with Section 2.4.2 of the Short-Term Dollar Supply
Agreement; provided, if there shall occur any reduction in the
Advance Commitment Amount as a result of the operation of Section
2.4.2 of the Short-Term Dollar Supply Agreement, then the
Commitment Amount hereunder shall be similarly reduced in
accordance with Section 2.2.2.
ARTICLE III
RETURN OF BULLION; POST-MATURITY RATES; FEES
SECTION 3.1. Return of Bullion. The Consignee shall
deliver to the Consignor all or a portion (as applicable) of the
Bullion then held under consignment by it in accordance with the
terms of this Section. No return of Bullion pursuant to this
Article III shall cause a reduction in the Commitment Amount.
Notwithstanding anything to the contrary contained herein or in
any other Fee Consignment Document, whenever the Consignee is
entitled or required to return to the Consignor any Bullion held
under consignment by the Consignee hereunder, instead of
returning such Bullion the Consignee may return and deliver all
of its right, title and interest in and to other gold and/or
silver, as applicable, to the Consignor which in all cases shall
be owned by the Consignee and shall be free and clear of all
Liens and adverse claims in an equivalent amount, and of an
equivalent quality and fineness, as such Bullion, and any such
return of other gold and/or silver, as applicable, shall
constitute a return of such Bullion for all purposes of this
Agreement and shall constitute a purchase of such Bullion for
purposes of the second sentence of each of Sections 2.3.3 and
4.2.
SECTION 3.1.1. Consignment Maturity Date. The Consignee
shall, at its election, either return to the Consignor and/or
purchase for cash all Bullion then consigned to it hereunder upon
the Consignment Maturity Date provided, that if on any
Consignment Maturity Date (without giving effect to any extension
of such date), a partial reduction to the Commitment Amount is
required in accordance with Section 2.2.2, then the Consignee
shall either return to the Consignor and/or purchase for cash
from the Consignor an amount of Bullion that is equal to the
amount of such reduction. To the extent the Consignor agrees to
a sale of Bullion for cash, the purchase price for each troy
ounce of any such gold or silver that the Consignee purchases
shall be determined in accordance with Section 2.3.3.
SECTION 3.1.2. Voluntary Return of Bullion. From time to
time on any Business Day prior to the Consignment Maturity Date,
the Consignee may voluntarily return to the Consignor all (or any
portion) of Bullion previously consigned to it hereunder in
respect of a Consignment Period or pursuant to a Swing Line
Consignment as designated by the Consignee; provided, however,
that
(a) with respect to Bullion held on consignment
hereunder other than pursuant to Swing Line Consignments, no
such voluntary return to the Consignor may be made on any
day other than the last day of the applicable Consignment
Period with respect to the Bullion then being returned to
the Consignor, unless the Consignor shall have agreed to
such return and the Consignee shall have given the Consignor
at least two (but no more than five) Business Days' notice,
and has paid any costs required pursuant to clause (a) of
Section 9.4 and clause (iii) of Section 9.3;
(b) with respect to Bullion held on consignment
hereunder other than pursuant to Swing Line Consignments,
all such voluntary partial returns of Bullion from
consignment shall be in a minimum number of troy ounces of
Bullion such that the number of ounces of Bullion returned
multiplied by the Dollar Value of gold or the Dollar Value
of silver (or both, if applicable) as in effect three
Business Days prior to the scheduled date of such return is
equal to or greater than $10,000,000; and
(c) with respect to Bullion held under Swing Line
Consignments, the Consignee shall have given the Consignor
notice by no later than 3:00 p.m., New York time (which may
be telephonic, followed on the same day by a confirmatory
writing) of such return, and the return of Bullion
previously held pursuant to Swing Line Consignments may be
in such number of ounces as the Consignee may elect.
SECTION 3.1.3. Mandatory Return of Bullion. The Consignee
shall return Bullion to the Consignor upon the occurrence of any
of the events set forth in this Section.
(a) If, on the last day of any Consignment Period:
(i) the number of troy ounces of gold then
consigned by the Consignor to the Consignee hereunder
(including pursuant to Swing Line Consignments) exceeds
the then effective Commitment Amount for gold on such
date, or
(ii) the number of troy ounces of silver then
consigned by the Consignor to the Consignee hereunder
(including pursuant to Swing Line Consignments) exceeds
the then effective Commitment Amount for silver on such
date,
in each case as the applicable Commitment Amount may have
been reduced pursuant to the terms of this Agreement, then
the Consignee shall, at its election, either mandatorily
return to the Consignor and/or purchase from the Consignor
that number of troy ounces of gold or silver (or both) in
the amount of such excess on the last day of such
Consignment Period; provided, that notwithstanding the
foregoing, the Consignee shall not be required to purchase
or return any Bullion pursuant to this clause except for
Bullion that was consigned in connection with such maturing
Consignment Period. To the extent the Consignor agrees to a
sale of Bullion pursuant to Section 2.3.3, the purchase
price for each troy ounce of any such gold or silver that
the Consignee purchases shall be determined in accordance
with Section 2.3.3.
(b) Upon the occurrence and continuance of any Market
Interruption Event and demand in writing by the Consignor to
the Consignee, the Consignee shall, at its election, either
return to the Consignor and/or purchase for cash from the
Consignor on the last day of each then maturing Consignment
Period (or earlier, if required in the reasonable
determination of the Consignor or if required by law), the
amount of Bullion so demanded by the Consignor. To the
extent the Consignor agrees to a sale of Bullion to the
Consignee pursuant to Section 2.3.3, the purchase price for
each troy ounce of any such gold or silver that the
Consignee purchases shall be determined in accordance with
Section 2.3.3.
(c) Pursuant to an appropriately completed
Continuation/Return Notice delivered at least four but not
more than five Business Days prior to the last day of a
Consignment Period in accordance with the terms of
Section 2.3.1 pursuant to which the Consignee has indicated
that it will return all or a portion of Bullion previously
consigned to it at the end of a Consignment Period, the
Consignee shall, at its election, either return to the
Consignor and/or purchase from the Consignor on the last day
of the applicable Consignment Period that number of troy
ounces of Bullion indicated in such Continuation/Return
Notice on the last day of the then maturing Consignment
Period. To the extent the Consignor agrees to a sale of
Bullion to the Consignee pursuant to Section 2.3.3, the
purchase price for each troy ounce of any such gold or
silver that the Consignee purchases shall be determined in
accordance with Section 2.3.3.
(d) Upon the failure of any Supplier to fund any
Advance on the commencement date of a Consignment Period as
required pursuant to the terms of the Short-Term Dollar
Supply Agreement the Consignee shall, within three Business
Days following demand by the Consignor, return or purchase
pursuant to the terms of this Agreement (unless such failure
is no longer continuing) the number of ounces of each type
of Bullion that was previously consigned in respect of such
non-funded Advance.
(e) Upon the last day of any then maturing Consignment
Period on which the Dollar Value of gold as in effect three
Business Days prior to the first day of the next occurring
Consignment Period multiplied by the number of ounces of
gold then consigned and the Dollar Value of silver as in
effect three Business Days prior to the first day of the
next occurring Consignment Period multiplied by the number
of ounces of silver then consigned exceeds the then
effective Advance Commitment Amount, the Consignee shall, at
its election, either return to the Consignor and/or purchase
from the Consignor on the last day of such maturing
Consignment Period, the number of troy ounces of Bullion
such that the Dollar Value of gold and Dollar Value of
silver (in each case as in effect three Business Days prior
to the first day of the next occurring Consignment Period)
that will remain consigned shall not exceed the Advance
Commitment Amount; provided, that notwithstanding the
foregoing, the Consignee shall not be required to purchase
or return any Bullion other than Bullion that was consigned
in connection with such then maturing Consignment Period.
To the extent the Consignor agrees to a sale of Bullion
pursuant to Section 2.3.3, the purchase price for each troy
ounce of any such gold or silver that the Consignee
purchases shall be determined in accordance with Section
2.3.3.
SECTION 3.1.4. Acceleration of Consignment Maturity Date.
Immediately upon any acceleration of the Consignment Maturity
Date pursuant to Section 8.2 or Section 8.3, the Consignee shall,
at its election, either return to the Consignor and/or purchase
pursuant to the terms of this Agreement from the Consignor, all
Bullion then under consignment to the full extent of such
acceleration. To the extent the Consignor agrees to a sale of
Bullion for cash, the purchase price for each troy ounce of any
such gold or silver that the Consignee purchases shall be
determined in accordance with Section 2.3.3.
SECTION 3.2. Post-Maturity Rates, etc. After the date any
monetary Obligation of the Consignee hereunder shall have become
due and payable, the Consignee shall pay interest (after as well
as before judgment) on such amounts on demand at a rate per annum
equal to the Alternate Base Rate plus a margin of 2% per annum.
In addition, to the extent that the Consignee fails to return (or
purchase) any Bullion on the dates required pursuant to the terms
of this Agreement, the Consignee shall pay to the Consignor,
(after as well as before judgment) on demand instead of the fees
set forth in Section 3.3.1, for each date that such Bullion is
not returned or purchased, an amount (the "ABR Fee") equal to the
product of (a) the Alternate Base Rate in effect on such day plus
a margin of 2% per annum minus the Contango Fee as in effect on
such day and (b) the Dollar Value of gold and the Dollar Value of
silver (as applicable) in each case as in effect three Business
Days prior to the first day of each applicable Consignment Period
then in effect multiplied by the number of ounces of gold and/or
silver not so returned or purchased on or prior to such day.
SECTION 3.3. Fees. The Consignee agrees to pay the fees
set forth in this Section 3.3. All such fees shall be non-
refundable.
SECTION 3.3.1. Consignment Fee. (a) The Consignee agrees
to pay to the Consignor in arrears with respect to each troy
ounce of gold and/or silver held on consignment hereunder a
consignment fee (the "Consignment Fee") based on
(i) in the case of each consignment other than
Swing Line Consignments, the Gold Rate (in the case of
consignments of gold) and the Silver Rate (in the case
of consignments of silver) plus in each case a margin
of 1/2 of 1% per annum, on the Dollar Value of such
gold (in the case of consignments of gold) or the
Dollar Value of such silver (in the case of
consignments of silver) as in effect three Business
Days prior to the first day of the Consignment Period
then in effect for such Bullion multiplied by the
number of troy ounces of gold and silver, respectively,
consigned for each such Consignment Period; and
(ii) in the case of a Swing Line Consignment, the
rate in effect from time to time as notified (in
writing or by telephonic notice) by the Consignor to
the Consignee during the period of time that such Swing
Line Consignment remains outstanding plus a margin of
1/2 of 1% per annum, multiplied by the number of troy
ounces of gold and silver, respectively, subject to
such Swing Line Consignment.
(b) For each day on which any Advances bear interest
at the Alternate Base Rate pursuant to Section 4.1, 4.2 or
4.3 of the Short-Term Dollar Supply Agreement, the Consignee
agrees to pay to the Consignor in arrears an additional
consignment fee on an amount equal to the aggregate
principal amount of all Advances then bearing interest at
the Alternate Base Rate, such fee with respect to any such
Advances to be (i) calculated based on a rate equal to the
positive difference, if any, between (x) the Alternate Base
Rate then in effect, and (y) the LIBO Rate (Reserve
Adjusted) (or, if applicable as a result of the operation of
Section 4.2 of the Short-Term Dollar Supply Agreement, the
Substitute Rate) that was in effect as of the first day of
the Consignment Period applicable to such Advances plus (in
each case) 1/2 of 1% per annum, and (ii) payable on the last
day of the Consignment Period then applicable to such
Advances (or on each three-month anniversary of such
Consignment Period if such Consignment Period is in excess
of three months).
The Consignment Fee will be paid in arrears (a) on the
Consignment Maturity Date, (b) in the case of other than Swing
Line Consignments, on the last day of each Consignment Period (or
on each three-month anniversary of a Consignment Period, for
Consignment Periods that are longer than three months) with
respect to the Bullion subject to such Consignment Period, (c) on
the last Business Day of March, June, September and December, in
the case of Swing Line Consignments, and (d) on the date of any
reduction in the Commitment Amount pursuant to Section 2.2.1 or
2.2.2, in an amount equal to any accrued Consignment Fee on that
portion of the Commitment Amount being reduced.
SECTION 3.3.2. Commitment Fee. The Consignee agrees to pay
to the Consignor a commitment fee equal to 1/8 of 1% per annum
multiplied by the product of (a) the difference between (i) the
average daily number of ounces of gold or silver, as the case may
be, committed to be consigned hereunder (based on the Dollar
Value of gold equalling $475 per ounce and the Dollar Value of
silver equalling $6.50 per ounce) during the relevant period, and
(ii) the average daily number of ounces of gold or silver, as the
case may be, actually consigned hereunder during the relevant
period, and (b) $475 (in the case of gold) and $6.50 (in the case
of silver) in each case without giving effect to any Bullion
consigned under Swing Line Consignments. Such commitment fee
shall be payable in arrears on each Quarterly Payment Date and on
the Commitment Termination Date.
SECTION 3.3.3. Other Fees. The Consignee agrees to pay to
the Consignor those fees, in the amounts and on the dates, set
forth in the Fee Letter.
ARTICLE IV
CERTAIN OTHER PROVISIONS; SECURITY INTEREST
SECTION 4.1. Consignments, etc. Unlawful. If the Consignor
shall determine (which determination shall, upon notice thereof
to the Consignee, absent manifest error, be prima facie evidence
of the facts stated therein) that the introduction of or any
change in or in the interpretation of any law makes it unlawful,
or any central bank or other governmental authority having
authority over the Consignor asserts that it is unlawful, for the
Consignor to consign (or maintain previously consigned) Bullion
with the Consignee, the obligations of the Consignor to consign
(or to maintain previously consigned) Bullion with the Consignee
shall, upon such determination, forthwith be suspended until the
Consignor shall notify the Consignee that the circumstances
causing such suspension no longer exist (which notification the
Consignor agrees to give promptly when such circumstances no
longer exist), and all Bullion theretofore delivered under
consignment to the Consignee hereunder shall be, at the election
of the Consignee, either returned to and/or purchased pursuant to
the terms hereof from the Consignor at the end of the then
current Consignment Periods with respect thereto or sooner, if
required by such law or assertion.
SECTION 4.2. Security Interest. Title to Bullion delivered
on consignment by the Consignor hereunder will remain with the
Consignor and will not pass to the Consignee. To the extent that
any Bullion (or a portion of Bullion) is purchased by the
Consignee pursuant to the terms of this Agreement, then title
only to such Bullion (or such portion of Bullion) will transfer
to the Consignee. The intent of the parties hereto is to create
a true consignment from the Consignor to the Consignee and not a
consignment for security, provided, however, that in order to
protect the rights of the Consignor in the event that either this
Agreement and the transactions contemplated hereby are construed
at any time with respect to any Bullion as other than a true
consignment from the Consignor to the Consignee (including as a
result of a Bullion Sale) as security for its Obligations (as
defined in this Agreement and the Fee Consignment Agreement) the
Consignee hereby grants the Consignor a Lien on and security
interest in and to the Collateral (whether now or hereafter
existing). "Collateral" means all of the Consignee's right,
title and interest in and to (i) all gold and silver of any
quality or fineness (including the Bullion), other than the U.S.
Bullion, located from time to time at the Plants, (ii) all
Processed Bullion located from time to time at the Plants and
(iii) all proceeds of such gold and silver, including, to the
extent that the Consignee has not returned to the Consignor
and/or purchased pursuant to the terms hereof any amount of
Bullion (or other gold and/or silver) that is delivered to any
account debtor of the Consignee, accounts owing by such account
debtor, and related general intangibles (if any) arising from the
sale of such gold and silver (including the Bullion and the gold
and silver (other than U.S. Bullion) comprising any Processed
Bullion). Terms used in the definition of Collateral for which
meanings are provided in the U.C.C. are used in the definition of
Collateral with such meanings. "Bullion Sale" means any sale of
Bullion by the Consignor to the Consignee, which sale shall occur
(notwithstanding the provisions of Section 2.3.3) at any time the
Consignee takes title to any Bullion, whether pursuant to Section
2.3.3 or at such earlier or other date as provided by law or
court order or decree. To the extent this Agreement and the
transactions contemplated hereby are not construed as a true
consignment from the Consignor to the Consignee, or upon the
occurrence of any Bullion Sale, the security interest granted
pursuant to this Section secures the complete and punctual
payment of all "Obligations" of the Consignee, whether now or
hereafter existing, under and as defined in (a) this Agreement
and each other Fee Consignment Document and (b) the Fee
Consignment Agreement and each other Fee Consignment Document (as
defined therein). To the extent any gold and/or silver (other
than the U.S. Bullion) of any quality or fineness (including the
Bullion) located at either Plant becomes part of a product, the
Consignor shall only have and shall continue to have rights or
interests in and to such product to the extent of an undivided
interest in such product that is equal to the ratio that the cost
of such gold and/or silver (other than the U.S. Bullion)
contained in such product or comprising a part thereof bears to
the cost of such product. In addition, gold and/or silver (other
than the U.S. Bullion) of any quality or fineness (including the
Bullion) located at either Plant that becomes part of a product
shall continue to be considered as being consigned to the
Consignee hereunder to the same extent as if such gold and/or
silver did not become part of a product and shall be subject to
all the terms hereof (including the continuation of title to such
gold and/or silver in the Consignor). Notwithstanding the
express intent of the parties hereto that this Agreement and the
transactions contemplated hereby be a true consignment from the
Consignor to the Consignee, the Consignee shall file
precautionary Uniform Commercial Code financing statements to
protect the rights of the Consignor in and to the Collateral. In
furtherance of the intent of the parties hereto that this
Agreement and the transactions contemplated hereunder are a true
consignment from the Consignor to the Consignee, and not a
consignment for security, the Consignor agrees that for so long
as no Event of Default has occurred and is continuing, it will
not initiate any action, suit or proceeding claiming that this
Agreement or any of the transactions contemplated hereunder are
other than a true consignment from the Consignor to the
Consignee.
SECTION 4.3. Losses. In the event the Consignor shall
incur any loss or expense as a result of
(a) any return to or purchase from the Consignor of
Bullion (other than Bullion consigned pursuant to Swing Line
Consignments which remains subject to consignment
thereunder) on a date other than the scheduled last day of
the Consignment Period applicable thereto, whether pursuant
to Section 3.1 or otherwise;
(b) any consignment of Bullion not being made in the
quantity or on the date requested by the Consignee, except
to the extent the same results from the failure of the
Consignor to satisfy its obligations hereunder with respect
thereto; or
(c) any consigned Bullion failing to remain under
consignment in accordance with the Continuation/Return
Notice therefor,
then, upon the written notice of the Consignor to the Consignee,
the Consignee, without duplication of its other Obligations,
shall, within five days of its receipt thereof, pay directly to
the Consignor such amount as will (in the reasonable
determination of the Consignor) reimburse the Consignor for such
loss or expense. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of
manifest error, be prima facie evidence of the matters stated
therein.
SECTION 4.4. Increased Costs. If any change in, or
the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority having authority over the Consignor
affects or would affect the amount of capital required or
expected to be maintained by the Consignor or any Person
controlling the Consignor, and the Consignor determines (in its
sole and absolute discretion) that the rate of return on its or
such controlling Person's capital as a consequence of its
Commitment or the consignment of Bullion hereunder is reduced to
a level below that which the Consignor or such controlling Person
could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to
time by the Consignor to the Consignee, the Consignee shall
immediately pay directly to the Consignor additional amounts
sufficient to compensate the Consignor or such controlling Person
for such reduction in rate of return. A statement of the
Consignor as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence
of manifest error, be prima facie evidence of the matters stated
therein. In determining such amount, the Consignor may use any
method of averaging and attribution that it (in its sole and
absolute discretion) shall deem applicable.
SECTION 4.5. Taxes. All payments by the Consignee
hereunder and by the Consignor to the Administrative Agent and
the Suppliers under the Short-Term Dollar Supply Agreement
(including in each case in respect of fees) shall be made free
and clear of and without deduction for any present or future
income, excise, stamp or franchise taxes and other taxes, fees,
duties, withholdings or other charges of any nature whatsoever
imposed by any taxing authority, but excluding franchise taxes
and taxes imposed on or measured by the Consignor's, the
Administrative Agent's or such Supplier's net income or receipts
imposed by the jurisdiction of incorporation or organization of
the Consignor, the Administrative Agent or such Supplier, as the
case may be (such non-excluded items being called "Taxes"). In
the event that any withholding or deduction from any payment to
be made by the Consignee hereunder or by the Consignor under the
Short-Term Dollar Supply Agreement is required in respect of any
Taxes pursuant to any applicable law, rule or regulation, then
the Consignee will
(a) in the case of withholding or deduction (i) in
respect of payments made for the account of the Consignor
hereunder, pay directly to the relevant authority the full
amount required to be so withheld or deducted, and (ii) in
respect of payments made by the Consignor to the
Administrative Agent or the Suppliers under the Short-Term
Dollar Supply Agreement, pay to the Consignor (and the
Consignor hereby agrees to pay over to the relevant
authority) the full amount required to be so withheld or
deducted;
(b) in the case of clause (a)(i), promptly forward to
the Consignor an official receipt or other documentation
satisfactory to the Consignor evidencing such payment to
such authority; and
(c) pay to the Consignor such additional amount or
amounts as is necessary to ensure that the net amount
actually received by the Consignor, the Administrative Agent
or such Supplier will equal the full amount such Person
would have received had no such withholding or deduction
been required.
Moreover, if the Consignor, the Administrative Agent or any
Supplier is obligated to pay any Taxes with respect to any
payment received by the Consignor hereunder or by the Consignor,
the Administrative Agent or such Supplier under the Short-Term
Dollar Supply Agreement, it may pay such Taxes and the Consignee
will promptly pay such additional amounts directly to the
Consignor (and, in the case of Taxes payable by the
Administrative Agent or a Supplier under the Short-Term Dollar
Supply Agreement, the Consignor agrees to pay over to the
Administrative Agent or such Supplier, as applicable) as is
necessary in order that the net amount received by such Person
after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount such Person would have
received had not such Taxes been asserted.
If the Consignee fails to pay any Taxes when due to the
appropriate taxing authority (in the case of clause (a)(i)) or
the Consignor (in the case of clause (a)(ii)) or fails to remit
to the Consignor, for the account of the Consignor or for the
account of the Administrative Agent or any Supplier, as set forth
above, the required receipts or other required documentary
evidence, the Consignee shall indemnify such Person for any
incremental Taxes, interest or penalties that may become payable
by such Person as a result of any such failure. Upon the request
of the Consignee, the Consignor shall, prior to the due date of
any payments hereunder, execute and deliver to the Consignee on
or about the first scheduled payment date in each Fiscal Year,
one or more (as the Consignee may reasonably request) United
States Internal Revenue Service Forms 4224 or Forms 1001 or such
other forms or documents (or successor forms or documents),
appropriately completed, as may be applicable to establish that
payments to the Consignor are exempt from withholding or
deduction of Taxes.
SECTION 4.6. Payments, Computations, etc. Unless otherwise
expressly provided, all payments of Dollars by the Consignee
pursuant to this Agreement or any other Fee Consignment Document
shall be made by the Consignee to the Consignor without setoff,
deduction or counterclaim, not later than 11:00 a.m. (New York
City time), on the date due, in immediately available funds, to
such account as the Consignor shall specify from time to time by
notice to the Consignee. Funds received after that time shall be
deemed to have been received by the Consignor on the next
succeeding Business Day. All fees shall be computed on the basis
of the actual number of days (including the first day but
excluding the last day) occurring during the period for which
such interest or fee is payable over a year comprised of 360
days. Whenever any payment to be made shall otherwise be due on
a day which is not a Business Day, such payment shall (except as
otherwise required by clause (b) of the definition of the term
"Consignment Period") be made on the next succeeding Business Day
and such extension of time shall be included in computing
interest and fees, if any, in connection with such payment.
ARTICLE V
CONDITIONS TO CONSIGNMENTS
SECTION 5.1. Initial Consignment. The obligations of the
Consignor to make the initial consignment of Bullion on and after
the Effective Date shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in
this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Consignor shall have
received from the Consignee a certificate, dated the date of the
initial delivery of Bullion under consignment, of its Secretary
or Assistant Secretary as to
(a) resolutions of its Board of Directors then in full
force and effect authorizing the execution, delivery and
performance of this Agreement and each other Fee Consignment
Document to be executed by it;
(b) true and complete copies of the Consignee's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement
and each other Fee Consignment Document executed by it,
upon which certificate the Consignor may conclusively rely until
it shall have received a further certificate of the Secretary or
Assistant Secretary of the Consignee canceling or amending such
prior certificate.
SECTION 5.1.2. Delivery of Financing Statements, etc. The
Consignor shall have received
(a) acknowledgment copies (or other evidence
satisfactory to it) of properly filed Uniform Commercial
Code financing statements (Form UCC-1), and (if available)
Uniform Commercial Code financing statements (Form UCC-3),
each dated a date reasonably near to the Effective Date,
naming (i) Handy & Harman as the consignee and The Bank of
Nova Scotia as the consignor (in the case of the Form UCC-1
Statements), and (ii) The Bank of Nova Scotia (as assignor)
and The Bank of Nova Scotia, in its capacity as
Administrative Agent (as assignee) (in the case of the Form
UCC-3 statements) or other similar instruments or documents,
filed under the Uniform Commercial Code of all jurisdictions
as may be necessary or, in the opinion of the Consignor,
desirable to perfect the interest of the Consignor pursuant
to the terms of this Agreement;
(b) executed copies of proper Uniform Commercial Code
Form UCC-3 termination statements, if any, necessary to
release all Liens and other rights of any Person in any
Collateral previously granted by the Consignee; and
(c) certified copies of Uniform Commercial Code
Requests for Information or Copies (Form UCC-11), or a
similar search report certified by a party acceptable to the
Consignor, dated a date reasonably near to the Effective
Date, listing all effective financing statements which name
the Consignee (under its trade names, present name and any
previous names) as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to
clause (a) above, together with copies of such financing
statements (none of which shall cover any Collateral).
SECTION 5.1.3. Delivery of Waiver and Consent or Amendment.
The Consignor shall have received a copy of a waiver and consent,
amendment or such other written agreement in form and substance
satisfactory to it from the respective holders of the Consignee's
8.83% Senior Notes due August 25, 2002, 9.37% Senior Notes due
December 27, 1999 and 10.2% Series D Senior Notes due 1998, duly
executed and delivered by such holders, except to the extent all
Indebtedness owing in respect of such notes has been paid in
full.
SECTION 5.1.4. Opinions of Counsel. The Consignor shall
have received opinions, dated the date of the initial consignment
and, except as set forth below, addressed to the Consignor
(together, in the case of other than clause (e), with reliance
letters to the Administrative Agent and the Suppliers), from
(a) Paul E. Dixon, Vice President and General Counsel
of the Consignee, substantially in the form of Exhibit D
hereto (and the Consignee hereby expressly instructs such
counsel to deliver such opinions to the Consignor, the
Administrative Agent and the Suppliers);
(b) Skadden, Arps, Slate, Meagher & Flom, New York
counsel to the Consignee, substantially in the form of
Exhibit E hereto (and the Consignee hereby expressly
instructs such counsel to deliver such opinions to the
Consignor, the Administrative Agent and the Suppliers);
(c) Bingham, Dana & Gould, Connecticut counsel to the
Consignor, substantially in the form of Exhibit F hereto
(and the Consignor hereby expressly instructs such counsel
to deliver such opinions to the Administrative Agent and the
Suppliers);
(d) Edwards & Angell, Rhode Island counsel to the
Consignee, substantially in the form of Exhibit G hereto
(and the Consignee hereby expressly instructs such counsel
to deliver such opinions to the Consignor, the
Administrative Agent and the Suppliers); and
(e) KPMG Peat Marwick, independent public accountants
to the Consignee, addressed to the Consignee and
substantially in the form of Exhibit H hereto.
SECTION 5.1.5. Closing Fees, Expenses, etc. The Consignor
shall have received all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 9.3, if then invoiced.
SECTION 5.2. All Deliveries under Consignment. The
obligation of the Consignor to deliver any Bullion on the
occasion of any consignment (including the initial consignment)
to the Consignee shall be subject to the satisfaction of each of
the conditions precedent set forth in this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default, etc.
Both before and after giving effect to the delivery of Bullion
requested to be held under consignment hereunder, the following
statements shall be true and correct:
(a) the representations and warranties set forth in
Article VI (including those incorporated by reference from
the Revolving Credit Agreement (other than those contained
in Section 6.7 of the Revolving Credit Agreement for any
consignment of Bullion that is to occur after the initial
consignment of Bullion hereunder)) shall be true and correct
in all material respects with the same effect as if then
made (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true
and correct as of such earlier date);
(b) except as disclosed by the Consignee to the
Consignor pursuant to Section 6.7 of the Revolving Credit
Agreement,
(i) no litigation, arbitration or governmental
investigation or proceeding shall be pending or, to the
knowledge of the Consignee, threatened against the
Consignee or any of its Subsidiaries which may
reasonably be expected to materially adversely affect
the Consignee's, or the Consignee and its Subsidiaries'
taken as a whole, businesses, operations, assets,
revenues, properties or prospects; and
(ii) no development shall have occurred in any
litigation, arbitration or governmental investigation
or proceeding disclosed pursuant to Section 6.7 of the
Revolving Credit Agreement which may reasonably be
expected to materially adversely affect the businesses,
operations, assets, revenues, properties or prospects
of the Consignee or the Consignee and its Subsidiaries,
taken as a whole;
(c) there shall not be any pending or, to the
knowledge of the Consignee, threatened, litigation,
arbitration or governmental investigation or proceeding
which purports to affect the legality, validity or
enforceability of this Agreement or any other Fee
Consignment Document;
(d) the Consignor shall not be prohibited by the
provisions of Section 2.1.2 from making the requested
consignment of Bullion;
(e) no Market Interruption Event shall have occurred
and then be continuing;
(f) for consignments other than Swing Line
Consignments, the Suppliers parties to the Short-Term Dollar
Supply Agreement shall have funded the Advances to the
Administrative Agent required in connection with the
requested consignment (provided, that the failure of one or
more Suppliers to fund such Advances shall not relieve the
Consignor from consigning Bullion to the Consignee to the
extent the Administrative Agent has received Advances from
other Suppliers under the Short-Term Dollar Supply
Agreement); and
(g) no Default shall have then occurred and be
continuing, and neither the Consignee nor any of its
Subsidiaries are in material violation of any law or
governmental regulation or court order or decree the
violation of which would have a material adverse effect on
businesses, operations, assets, revenues, properties or
prospects of the Consignee or the Consignee and its
Subsidiaries, taken as a whole.
SECTION 5.2.2. Consignment Request. The Consignor shall
have received a Consignment Request for such Consignment (or, in
the case of Swing Line Consignments, a telephonic request from
the Consignee to the Consignor). Each of the delivery of a
Consignment Request (or, in the case of Swing Line Consignments,
any telephonic request made by the Consignee to the Consignor to
provide Swing Line Consignments) and the acceptance by the
Consignee of any Bullion to be held by it under consignment shall
constitute a representation and warranty by the Consignee to the
Consignor that on the date of such consignment (both immediately
before and after giving effect to such consignment) the
statements made in clauses (a), (b), (c), (d) and (g) of Section
5.2.1 are true and correct.
SECTION 5.2.3. Continuation of Consignment Period. The
requirement that the Consignor continue to consign to the
Consignee any previously consigned Bullion subject to a maturing
Consignment Period upon the occasion of the expiration of such
Consignment Period is subject to satisfaction of each of the
conditions precedent set forth below:
(a) the Consignee shall not be prohibited by the
provisions of Section 2.1.2 from continuing to hold under
consignment such Bullion;
(b) unless otherwise agreed by the Consignor, no Market
Interruption Event shall have occurred and then be
continuing;
(c) no Consignor Bankruptcy Event shall have occurred;
and
(d) if required pursuant to clause (a) of Section 2.3.1
of the Short-Term Dollar Supply Agreement, the Suppliers
parties to the Short-Term Dollar Supply Agreement shall have
funded the Advances to the Administrative Agent required in
connection with the requested continuation (provided, that
the failure of one or more Suppliers to fund such Advances
shall not relieve the Consignor from continuing under
consignment Bullion to the Consignee to the extent the
Administrative Agent has received Advances from other
Suppliers under the Short-Term Dollar Supply Agreement).
SECTION 5.2.4. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto by or on behalf of the
Consignee in connection with such consignment (or continuation,
as the case may be) shall be satisfactory in form and substance
to the Consignor and its counsel; the Consignor and its counsel
shall have received all information, approvals, opinions,
documents or instruments as the Consignor or its counsel may
reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Consignor to enter into this
Agreement and deliver Bullion under consignment to the Consignee
hereunder, the Consignee represents and warrants to the Consignor
as set forth in this Article VI.
SECTION 6.1. Representations and Warranties. The Consignee
hereby represents and warrants to the Consignor that the
representations and warranties contained in Article VI of the
Short Term Revolving Credit Agreement are true and correct, each
such representation and warranty set forth in such Article and
all other terms of the Short Term Revolving Credit Agreement to
which reference is made therein, together with all related
definitions and ancillary provisions, being hereby incorporated
into this Agreement by reference as though specifically set forth
in this Section; provided, that each reference in such Article to
the "Borrower", the "Administrative Agent", "Obligations", "this
Agreement" and "Loan Documents" and words of similar import shall
be deemed to be a reference to the "Consignee", the "Consignor",
the Obligations hereunder, this Short-Term Fee Consignment
Agreement and the Fee Consignment Documents, respectively.
SECTION 6.2. Further Representations. In addition to the
representations and warranties set forth above, the Consignee
hereby represents and warrants to the Consignor that (a) the
Consignee has full power and authority to receive and hold
Bullion for the Consignor on the terms and conditions contained
herein and has obtained all necessary governmental consents,
licenses and approvals, if any, that are required to receive and
hold such Bullion, and (b) if this Agreement and the transactions
contemplated hereunder are construed as other than a true
consignment from the Consignor to the Consignee, then this
Agreement creates a valid, first priority security interest in
favor of the Consignor in the Collateral, securing the payment of
the Obligations, and all filings and other actions necessary to
perfect a first priority security interest in favor of the
Consignor in such Collateral have been duly taken in all
applicable jurisdictions.
ARTICLE VII
COVENANTS
In order to induce the Consignor to enter into this
Agreement and deliver Bullion under consignment to the Consignee
hereunder, the Consignee covenants and agrees that until the
Commitment shall have been terminated and all Obligations then
due and outstanding shall have been paid or performed in full and
all Bullion shall have been returned to and/or purchased from the
Consignor, the Consignee shall comply with the covenants as set
forth in this Article VII.
SECTION 7.1. Covenants. The Consignee will perform, comply
with and be bound by all of the agreements, covenants and
obligations contained in Article VII of the Revolving Credit
Agreement, each such agreement, covenant and obligation contained
in such Article and all other terms of the Revolving Credit
Agreement to which reference is made therein, together with all
related definitions and ancillary provisions, being hereby
incorporated into this Agreement by reference as though
specifically set forth in this Section; provided, that each
reference in such Article to the "Borrower", the "Administrative
Agent", "Obligations", "this Agreement" and "Loan Documents" and
words of similar import shall be deemed to be a reference to the
"Consignee", the "Consignor", the Obligations hereunder, this
Short-Term Fee Consignment Agreement and the Fee Consignment
Documents, respectively.
SECTION 7.2. Additional Covenants. In addition to the
covenants set forth in Section 7.1, the Consignee further
covenants and agrees that it will perform, comply and be bound by
the covenants set forth in this Section.
SECTION 7.2.1. Safekeeping, etc. Until such time as the
Bullion received from the Consignor has been returned to the
Consignor, or purchased pursuant to the terms of this Agreement
by the Consignee, the Consignee will afford the Bullion no less
safekeeping protection than it affords gold and silver held for
its own account, and in any event the Consignor will at all times
be satisfied with the level of such protection. The Consignee
will provide insurance coverage on Bullion held on consignment in
such amounts and covering such risks as is required by the
Consignor and the Consignee shall, upon request, deliver to the
Consignor a copy of all policies for such insurance. Insurance
policies in respect of the Bullion located at the Plants shall
name the Consignor as loss payee and proceeds from such insurance
with respect to Bullion will be paid to the Consignor.
SECTION 7.2.2. Bullion to be Located at Plants. The
Consignee agrees that it will at all times cause all Bullion held
on consignment hereunder and not sold to a customer of the
Consignee to be located only (i) at the Plants, (ii) in transit
between the Plants and/or (iii) in transit to the Consignor;
provided, however, that no sale to any customer of the Consignee
shall be made unless the Consignee shall have first either
purchased or returned a like amount of gold or silver to the
Consignor pursuant to the terms of this Agreement. The Consignee
further agrees that except for U.S. Bullion and Bullion (under
and as defined in this Agreement and the Fee Consignment
Agreement), no other gold or silver that is not owned by the
Consignor will be kept in either Plant. In any event, if any
gold or silver (other than U.S. Bullion and Bullion (under and as
defined in this Agreement and the Fee Consignment Agreement)
shall at any time be located at either Plant, the Consignee
agrees that such gold and silver shall be transferred (by book
entry or otherwise) as soon as practicable (and in any event no
later than the next Business Day) to another facility of the
Consignee's.
SECTION 7.2.3. Use of Bullion. The Consignee agrees that it
shall use the Bullion held on consignment pursuant to the terms
of this Agreement only in connection with the completion of
customer orders in the ordinary course of business at the Plants.
SECTION 7.2.4. Further Assurances, etc. The Consignee
agrees that, from time to time at its own expense, the Consignee
will promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or
desirable, or that the Consignor may request, in order to
perfect, preserve and protect any of its interest in the Bullion
and the other Collateral and the assignment by the Consignor to
the Administrative Agent contemplated pursuant to clause (b)(i)
of Section 9.10.
SECTION 7.2.5. SEC Filings. On the date of the filing of
the Consignee's next Form 8-K with the Securities and Exchange
Commission, the Consignee shall include a note stating that all
gold and silver (other than the U.S. Bullion) located at each
Plant is owned by the Consignor and held under consignment by the
Consignee.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 8.1
shall constitute an "Event of Default".
SECTION 8.1.1. Failure to Return Bullion, etc. Failure by
the Consignee (i) to return and/or purchase for cash pursuant to
the terms hereof any amount of Bullion on the date a return or
purchase thereof is required hereunder or (ii) pay any
Consignment Fees, interest or other monetary Obligations, in the
case of this clause (ii) within five days of the date on which it
is due hereunder.
SECTION 8.1.2. Breach of Warranty. Any representation or
warranty of the Consignee made or deemed to be made hereunder or
in any other Fee Consignment Document or any other writing or
certificate furnished by or on behalf of the Consignee to the
Consignor for the purposes of or in connection with this
Agreement or any such other Fee Consignment Document (including
any certificates delivered pursuant to Article V) is or shall be
incorrect when made in any material respect.
SECTION 8.1.3. Validity of Security Interest. Any Fee
Consignment Document, or, to the extent the consignments
hereunder are not true consignments from the Consignor to the
Consignee or a Bullion Sale occurs, any Lien granted thereunder,
shall (except in accordance with its terms), in whole or in part,
terminate, cease to be effective or cease to be the legally
valid, binding and enforceable obligation of the Consignee; the
Consignee or any other party shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding
nature or enforceability; or, to the extent the consignments
hereunder are not true consignments from the Consignor to the
Consignee or a Bullion Sale occurs, any Lien securing any
Obligation shall, in whole or in part, cease to be a perfected
first priority Lien in favor of the Consignor and its assigns.
SECTION 8.1.4. Non-Performance of Other Covenants and
Obligations. The Consignee shall default in the due performance
and observance of any agreement contained herein or in any other
Fee Consignment Document (other than as set forth in Section
8.1.1), and such default shall continue unremedied for a period
of 10 Business Days after notice thereof shall have been given to
the Consignee by the Consignor.
SECTION 8.1.5. Default on Material Contracts. (a) An Event
of Default under (and as defined in) the Revolving Credit
Agreement or the Short Term Revolving Credit Agreement shall have
occurred and be continuing, (b) an Event of Default under (and as
defined in) the Dollar Supply Agreement or the Short-Term Dollar
Supply Agreement shall have occurred and be continuing or (c) a
default shall occur in the payment when due (subject to any
applicable grace period), whether by acceleration or otherwise,
of any Indebtedness (other than Indebtedness outstanding under
the Revolving Credit Agreement or the Short Term Revolving Credit
Agreement) of the Consignee or any of its Subsidiaries having a
principal amount, individually or in the aggregate, in excess of
$1,000,000, or a default shall occur in the performance or
observance of any obligation or condition with respect to such
Indebtedness if the effect of such default is to accelerate the
maturity of any such Indebtedness or such default shall continue
unremedied for any applicable period of time sufficient to permit
the holder or holders of such Indebtedness, or any trustee or
agent for such holders, to cause such Indebtedness to become due
and payable prior to its expressed maturity.
SECTION 8.1.6. Bankruptcy, Insolvency, etc. The Consignee
or any of its Subsidiaries (including joint ventures) shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignee or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignee or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall not
be discharged within 60 days, provided that the Consignee,
each Subsidiary and each joint venture hereby expressly
authorizes the Consignor to appear in any court conducting
any relevant proceeding during such 60-day period to
preserve, protect and defend their rights under the Fee
Consignment Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignee or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Consignee or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in by
the Consignee or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed, provided that the Consignee,
each Subsidiary and each such joint venture hereby expressly
authorizes the Consignor to appear in any court conducting
any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Fee
Consignment Documents; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Consignee, the value of whose assets in
the aggregate for the Fiscal Quarter most recently ended
accounted for an amount equal to or less than 5% of Adjusted
Consolidated Tangible Net Worth.
SECTION 8.1.7. Consignment Treatment. The consignment of
Bullion pursuant to the terms of this Agreement shall be
characterized as other than a true consignment from the Consignor
to the Consignee (for accounting purposes or as determined by a
court of competent jurisdiction), and such characterization shall
continue for a period of thirty consecutive days.
SECTION 8.2. Action if Bankruptcy. If any Event of Default
described in clauses (a) through (d) of Section 8.1.6 shall
occur, the Commitment (if not theretofore terminated) shall
automatically terminate and the Consignment Maturity Date shall
automatically be accelerated, and all previously delivered
Bullion then held by the Consignee pursuant to the terms hereof
shall be immediately returned to the Consignor, and all monetary
Obligations shall automatically be and become immediately due and
payable, without the requirement of notice or demand by the
Consignor to the Consignee of any kind being necessary.
SECTION 8.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 8.1.6) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Consignor may by notice to the Consignee demand that all or any
portion of the previously delivered Bullion then held by the
Consignee pursuant to the terms hereof to be returned to the
Consignor and/or declare all monetary Obligations to be due and
payable and/or the Commitment (if not theretofore terminated) to
be terminated and the Consignment Maturity Date to be
accelerated, whereupon all or such portion of such Bullion shall
immediately be returned to the Consignor, and the full unpaid
amount of such Obligations which shall be so declared due and
payable shall be and become immediately due and payable, without
further notice, demand or presentment, and/or, as the case may
be, the Commitment shall terminate and the Consignment Maturity
Date shall be accelerated.
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Fee Consignment Document may
from time to time be amended, modified or waived, if such
amendment, modification or waiver is in writing and consented to
by the Consignee and the Consignor. No failure or delay on the
part of the Consignor in exercising any power or right under this
Agreement or any other Fee Consignment Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any
such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice
to or demand on the Consignee in any case shall entitle it to any
notice or demand in similar or other circumstances. No waiver or
approval by the Consignor under this Agreement or any other Fee
Consignment Document shall, except as may be otherwise stated in
such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted
hereunder.
SECTION 9.2. Notices. All notices and other communications
provided to any party hereto under this Agreement or any other
Fee Consignment Document shall be in writing or by facsimile and
addressed, delivered or transmitted to such party at its address
or facsimile number set forth below its signature hereto. Any
notice, if mailed and properly addressed with postage prepaid or
if properly addressed and sent by pre-paid courier service, shall
be deemed given when received; any notice, if transmitted by
facsimile, shall be deemed given when transmitted upon receipt of
electronic confirmation of transmission.
SECTION 9.3. Payment of Costs and Expenses. The Consignee
agrees to pay on demand all reasonable out-of-pocket expenses of
the Consignor and (without duplication) the Administrative Agent
(including the fees and out-of-pocket expenses of a single
counsel to the Consignor and of local counsel, if any, who may be
retained by counsel to the Consignor and (without duplication)
the Administrative Agent), in connection with
(a) the negotiation, preparation, execution and
delivery of this Agreement and of each other Fee Consignment
Document, the Dollar Supply Agreement and the Short-Term
Dollar Supply Agreement, including in each case schedules
and exhibits, and any amendments, waivers, consents,
supplements or other modifications to this Agreement or any
other Fee Consignment Document, the Dollar Supply Agreement
or the Short-Term Dollar Supply Agreement as may from time
to time hereafter be required, whether or not the
transactions contemplated hereby are consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Fee Consignment Document or the Dollar Supply
Agreement and the Short-Term Dollar Supply Agreement;
(c) the filing, recording, refiling or rerecording of
any Uniform Commercial Code financing statements relating
thereto and all amendments, supplements and modifications to
any thereof and any and all other documents or instruments
of further assurance required to be filed or recorded or
refiled or rerecorded by the terms hereof; and
(d) the administration and monitoring of this
Agreement and the Fee Consignment Documents, the Dollar
Supply Agreement and the Short-Term Dollar Supply Agreement,
and compliance of the parties hereto with respect to the
terms hereof.
The Consignee further agrees to pay on demand (or, in the case of
clause (iii) below, within five days following demand) therefor,
and to save the Consignor harmless from all liability for, (i)
any stamp or other taxes which may be payable in connection with
the execution or delivery of this Agreement or any other Fee
Consignment Document, or the consignment of Bullion hereunder,
(ii) all amounts payable under Article IV hereof, and (iii) all
amounts the Consignor is required to pay or to pay over to the
Suppliers and the Administrative Agent (or would be required to
pay or pay over to the extent first paid by the Consignee
hereunder) under Sections 4.1 through 4.6 (inclusive), 4.10 of
the Short-Term Dollar Supply Agreement (but only, in the case of
Sections 4.1 and 4.2 and the proviso in Section 4.3 thereof (and
in any event without duplication of the Consignee's Obligation
under clause (b) of Section 3.3.1 hereof), to the extent any such
amount is calculated by reference to a rate equal to the positive
difference, if any, between (x) the Alternate Base Rate from time
to time in effect and (y) a LIBO Rate (Reserve Adjusted) plus 1/2
of 1% per annum (or, if applicable, the Substitute Rate plus 1/2
of 1% per annum) (and the Consignee agrees that, for purposes of
any determination to be made for purposes of Sections 4.1, 4.2,
4.3 or 4.4 of the Short-Term Dollar Supply Agreement, it shall be
conclusively assumed that each Supplier elected to fund LIBO Rate
Advances by purchasing Dollar deposits in its LIBOR Office's
interbank eurodollar market), Section 8.3 of the Short-Term
Dollar Supply Agreement and Section 8.4 of the Short-Term Dollar
Supply Agreement in respect of all of the Indemnified Liabilities
(as defined in Section 8.4 of the Short-Term Dollar Supply
Agreement), to the extent (and only to the extent) such
Indemnified Liabilities do not result from a breach by the
Consignor of its obligations hereunder or under the Short-Term
Dollar Supply Agreement, from a Consignor Bankruptcy Event or
from the gross negligence or wilful misconduct of the Consignor.
To the extent that the foregoing undertaking with respect to the
payment of any such Indemnified Liabilities under Section 8.4 of
the Short-Term Dollar Supply Agreement may be unenforceable for
any reason, the Consignee hereby agrees to make the maximum
contribution to the payment and satisfaction of such Indemnified
Liabilities which is permissible under applicable law. The
Consignee also agrees to reimburse the Consignor upon demand for
all reasonable out-of-pocket expenses (including attorneys' fees
and legal expenses) incurred by the Consignor and (without
duplication) the Administrative Agent in connection with (x) the
negotiation of any restructuring or "work-out", whether or not
consummated, of any Obligations and (y) the enforcement of any
Obligations.
SECTION 9.4. Indemnification. In consideration of the
execution and delivery of this Agreement by the Consignor and the
consignment of Bullion hereunder, the Consignee (without
duplication of any of its other monetary Obligations hereunder)
hereby indemnifies, exonerates and holds the Consignor and its
officers, directors, employees and agents (collectively, the
"Indemnified Parties") free and harmless from and against any and
all actions, causes of action, suits, losses, costs, liabilities
and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to
the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements
(collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out
of, or relating to
(a) the failure of the Consignee for any reason to
return the required amount of Bullion back to the Consignor
on the dates required pursuant to the terms of this
Agreement (whether at the end of a Consignment Period,
following the occurrence of a Market Interruption Event or
otherwise), except to the extent the Consignee has purchased
such Bullion from the Consignor in accordance with the terms
hereof;
(b) in the case of other than Swing Line Consignments,
the return of any Bullion to the Consignor on other than the
last day of the Consignment Period applicable to such
Bullion;
(c) the failure by the Consignee to pay to the
Consignor any monetary amounts under Sections 3.2, 3.3, 4.5,
8.2, 8.3 or clause (iii) of Section 9.3 hereof which, in
turn, the Consignor is required to pay over to the Suppliers
(notwithstanding that such amounts are only payable by the
Consignor if and to the extent first paid by the Consignee)
under Sections 3.2.3, 3.2.1, 3.2.2, 4.6, 6.2 and 6.3 of the
Short-Term Dollar Supply Agreement;
(d) any investigation, litigation or proceeding
involving the Consignee or any of its Subsidiaries or
property now or previously owned or leased by the Consignee
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Consignee or any of its
Subsidiaries or the Release by the Consignee or any of its
Subsidiaries of any Hazardous Material; provided, that the
Indemnified Party shall have given the Consignee notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(e) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Consignee or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Consignee or such
Subsidiary;
(f) any breach of warranty contained in Section 6.12
of the Revolving Credit Agreement (as incorporated by
reference pursuant to Section 6.1 hereof), without giving
effect to the exceptions based upon the materially adverse
effect and any qualification based on materiality or
knowledge; or
(g) the entering into and performance of this
Agreement and any other Fee Consignment Document by any of
the Indemnified Parties (including any action brought by or
on behalf of the Consignee as the result of any
determination by the Consignor pursuant to Article V not to
consign Bullion to the Consignee due to the failure of the
Consignee to meet the conditions for such consignment);
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of a
Consignor Bankruptcy Event, or any Indemnified Party's gross
negligence or wilful misconduct or except to the extent (and only
to the extent) the same results from a breach by the Consignor of
its obligations hereunder or under the Short-Term Dollar Supply
Agreement. If and to the extent that the foregoing undertaking
may be unenforceable for any reason, the Consignee hereby agrees
to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under
applicable law. The Consignor hereby acknowledges and agrees
that the Consignee shall not be liable for any Indemnified
Liabilities arising solely as a result of changes in value of
gold or silver or the method utilized by the Consignor of funding
or procuring the Bullion to be consigned under this Agreement,
except to the extent such Indemnified Liability results from a
Default by the Consignee of its Obligations.
SECTION 9.5. Survival. The obligations of the Consignee
under Sections 4.3, 4.4, 4.5, 4.6, 9.3 and 9.4 shall survive any
termination of this Agreement, the payment in full of all
Obligations, and return to the Consignor of all Bullion and the
termination of the Commitment. The representations and
warranties made by the Consignee in this Agreement and in each
other Fee Consignment Document shall survive the execution and
delivery of this Agreement and each such other Fee Consignment
Document.
SECTION 9.6. Severability. Any provision of this Agreement
or any other Fee Consignment Document which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Fee Consignment
Document or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 9.7. Headings. The various headings of this
Agreement and of each other Fee Consignment Document are inserted
for convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Fee Consignment
Document or any provisions hereof or thereof.
SECTION 9.8. Execution in Counterparts, Effectiveness, etc.
This Agreement may be executed by the parties hereto in several
counterparts, each of which shall be deemed to be an original and
all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Consignee and the
Consignor (or notice thereof satisfactory to the Consignor) shall
have been received by the Consignor and notice thereof shall have
been given by the Consignor to the Consignee.
SECTION 9.9. Governing Law; Entire Agreement. THIS
AGREEMENT AND EACH OTHER FEE CONSIGNMENT DOCUMENT SHALL EACH BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. This Agreement and the other Fee
Consignment Documents constitute the entire understanding among
the parties hereto with respect to the subject matter hereof and
supersede any prior agreements, written or oral, with respect
thereto.
SECTION 9.10. Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns; provided,
however, that:
(a) the Consignee may not assign or transfer its
rights, title, interests or obligations hereunder without
the prior written consent of the Consignor; and
(b) the Consignor may (i) pursuant to Section 4.11 of
the Dollar Supply Agreement and Section 4.11 of the Short-
Term Dollar Supply Agreement, assign its rights, title and
interests (but not its obligations) hereunder (including
with respect to the security interest in the Collateral
granted pursuant to Section 4.2) to the Administrative Agent
(under and as defined in the Short-Term Dollar Supply
Agreement and the Dollar Supply Agreement) for its benefit
and the benefit of the Suppliers (under and as defined in
such agreements), and (ii) at any time assign or transfer
all or any of its rights, title, interests and/or
obligations hereunder, provided (in the case of this clause
(b)(ii)), such assignment or transfer is to its successors
or to a wholly-owned Subsidiary or a branch or agency of the
Consignor.
The Consignee agrees that, subject to the provisions of clause
(e) of Section 8.11.2 of the Short-Term Dollar Supply Agreement,
each Participant to the Short-Term Dollar Supply Agreement, for
purposes of Sections 4.3, 4.4, 4.6, 4.8, 4.9, 8.3 and 8.4
thereof, shall be considered a Supplier.
SECTION 9.11. Forum Selection and Consent to Jurisdiction.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER FEE CONSIGNMENT
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE CONSIGNOR, ANY AGENT,
ANY SUPPLIER OR THE CONSIGNEE SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE CITY AND STATE OF NEW YORK OR IN
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
CONSIGNOR'S OR THE ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY
BE FOUND. THE CONSIGNEE HEREBY EXPRESSLY AND IRREVOCABLY
SUBMITS, FOR ITSELF AND TO THE EXTENT PERMITTED BY APPLICABLE
LAW, ITS PROPERTY, TO THE JURISDICTION OF THE COURTS OF THE CITY
AND STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. THE CONSIGNEE FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY
PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. THE
CONSIGNEE HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
TO THE EXTENT THAT THE CONSIGNEE HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE CONSIGNEE HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE OTHER FEE CONSIGNMENT DOCUMENTS.
SECTION 9.12. Waiver of Jury Trial. THE CONSIGNOR AND THE
CONSIGNEE HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON OR BASED, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER FEE CONSIGNMENT
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE CONSIGNOR OR THE
CONSIGNEE. THE CONSIGNEE ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER FEE CONSIGNMENT DOCUMENT
TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE CONSIGNOR ENTERING INTO THIS AGREEMENT AND
EACH SUCH OTHER FEE CONSIGNMENT DOCUMENT AND THE SUPPLIERS AND
THE CONSIGNOR ENTERING INTO THE SHORT-TERM DOLLAR SUPPLY
AGREEMENT AND ADVANCE DOCUMENTS.
SECTION 9.13. Benefit of this Agreement. The Consignee
acknowledges and agrees that the Administrative Agent and the
Suppliers are third-party beneficiaries of clause (iii) of the
last paragraph of Section 9.3 of this Agreement.
SECTION 9.14. Settlement Amount. If a judgment in Dollars
(instead of specific performance) is entered against the
Consignee with respect to the Consignee's failure to return all
or a portion of Bullion (or other gold or silver) in the amounts
and on the dates required pursuant to this Agreement, and the
amount of Dollars so awarded is less than the sum of (i) the
Dollar Value of gold multiplied by the number of ounces of such
unreturned gold and/or (ii) the Dollar Value of silver multiplied
by the number of ounces of such unreturned silver, in each case
as in effect three Business Days prior to the first day of the
Consignment Periods then in effect for such unreturned Bullion
("Settlement Amount"), then the Consignee agrees that it shall
pay to the Consignor the difference between the Settlement Amount
and the amount of Dollars awarded pursuant to such judgment.
SECTION 9.15. Waiver of Immunity. To the extent that the
Consignor may have any immunity on the grounds of sovereignty or
otherwise from jurisdiction of any court in the United States or
from any legal process (whether through service or notice,
attachment prior to judgment, attachment in aid of execution or
otherwise) or from any legal proceeding with respect to itself or
its property, the Consignor hereby irrevocably waives such
immunity for itself and its property (including, without
limitation, property held by the Consignor for its own account)
with respect to its obligations under this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Title: Vice President and Treasurer
Address: 250 Park Avenue
New York, New York 10177
Facsimile No.: 212-309-0682
Attention: Mr. Stephen B. Mudd
Vice President and Treasurer
THE BANK OF NOVA SCOTIA
By: /s/ Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
With a copy to:
Address: The Bank of Nova Scotia
Scotia Plaza
44 King Street West
Toronto, Ontario
Canada M5H 1H1
Facsimile No.: 416-866-4053
Attention: Peter Payne
EXHIBIT 10.7
EXECUTION COPY
U.S. $125,375,000
DOLLAR SUPPLY AGREEMENT,
dated as of September 28, 1994
among
THE BANK OF NOVA SCOTIA,
as the Consignor,
CERTAIN FINANCIAL INSTITUTIONS,
as the Suppliers,
THE BANK OF NOVA SCOTIA,
CHEMICAL BANK
and
THE BANK OF NEW YORK,
as the Co-Agents for the Suppliers,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent for the Suppliers.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . . .
ARTICLE II
ADVANCE COMMITMENT AND MAKING OF ADVANCES
2.1. Advance Commitment . . . . . . . . . . . . . . . .
2.1.1. Advance Commitment . . . . . . . . . . . . . . .
2.1.2. Suppliers Not Permitted or Required to Make
Advances . . . . . . . . . . . . . . . . . . .
2.2. Reduction of Advance Commitment Amount . . . . .
2.3. Advance Procedures and Funding . . . . . . . . .
2.3.1. Continuation Elections . . . . . . . . . . . . .
2.3.2. Funding . . . . . . . . . . . . . . . . . . . .
2.4. Extension of Stated Maturity Date and Maturity
of Advances . . . . . . . . . . . . . . . . .
2.4.1. Request for Extension of Stated Maturity Date
and Maturity of Advances . . . . . . . . . . .
2.4.2. Consent to Extension of Stated Maturity Date
and Maturity of Advances . . . . . . . . . . .
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments . . . . . . . . . . .
3.1.1. Final Maturity . . . . . . . . . . . . . . . . .
3.1.2. Acceleration of Stated Maturity Date . . . . . .
3.1.3. Mandatory Prepayments of Advances . . . . . . .
3.2. Fees . . . . . . . . . . . . . . . . . . . . . .
3.2.1. Funding Fee . . . . . . . . . . . . . . . . . .
3.2.2. Commitment Fees . . . . . . . . . . . . . . . .
3.2.3. Post-Maturity Rates . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . .
4.2. Deposits Unavailable . . . . . . . . . . . . . .
4.3. Increased LIBO Rate Advance Costs, etc. . . . .
4.4. Funding Losses . . . . . . . . . . . . . . . . .
4.5. Increased Capital Costs . . . . . . . . . . . .
4.6. Taxes . . . . . . . . . . . . . . . . . . . . .
4.7. Payments, Computations, etc. . . . . . . . . . .
4.8. Sharing of Payments . . . . . . . . . . . . . .
4.9. Use of Proceeds . . . . . . . . . . . . . . . .
4.10. Replacement of Suppliers . . . . . . . . . . . .
4.11. Assignment to Administrative Agent . . . . . . .
ARTICLE V
CONDITIONS TO ADVANCES
5.1. Initial Advance . . . . . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . .
5.1.2. Revolving Credit Agreement and Fee Consignment
Agreement Effectiveness . . . . . . . . . . .
5.1.3. Opinions of Counsel . . . . . . . . . . . . . .
5.1.4. Closing Fees, Expenses, etc. . . . . . . . . . .
5.2. All Advances . . . . . . . . . . . . . . . . . .
5.2.1. No Default, etc. . . . . . . . . . . . . . . . .
5.2.2. Advance Request . . . . . . . . . . . . . . . .
5.2.3. Satisfactory Legal Form . . . . . . . . . . . .
5.2.4. No Consignor Bankruptcy Event . . . . . . . . .
5.2.5. Advances Pursuant to Section 2.3.1 . . . . . . .
ARTICLE VI
EVENTS OF DEFAULT
6.1. Listing of Events of Default . . . . . . . . . .
6.1.1. Breach of Warranty . . . . . . . . . . . . . . .
6.1.2. Default Under Material Agreements, etc. . . . .
6.1.3. Bankruptcy, Insolvency, etc. . . . . . . . . . .
6.2. Action if Bankruptcy . . . . . . . . . . . . . .
6.3. Action if Other Event of Default . . . . . . . .
6.4. Consignor Bankruptcy Event . . . . . . . . . . .
ARTICLE VII
THE AGENTS
7.1. Actions . . . . . . . . . . . . . . . . . . . .
7.2. Funding Reliance, etc. . . . . . . . . . . . . .
7.3. Exculpation . . . . . . . . . . . . . . . . . .
7.4. Successor . . . . . . . . . . . . . . . . . . .
7.5. Advances by an Agent. . . . . . . . . . . . . .
7.6. Credit Decisions . . . . . . . . . . . . . . . .
7.7. Copies, etc. . . . . . . . . . . . . . . . . . .
ARTICLE VIII
MISCELLANEOUS PROVISIONS
8.1. Waivers, Amendments, etc. . . . . . . . . . . .
8.2. Notices . . . . . . . . . . . . . . . . . . . .
8.3. Payment of Costs and Expenses . . . . . . . . .
8.4. Turn-Over of Certain Payments . . . . . . . . .
8.5. Survival . . . . . . . . . . . . . . . . . . . .
8.6. Severability . . . . . . . . . . . . . . . . . .
8.7. Headings . . . . . . . . . . . . . . . . . . . .
8.8. Execution in Counterparts, Effectiveness, etc. .
8.9. Governing Law; Entire Agreement . . . . . . . .
8.10. Successors and Assigns . . . . . . . . . . . . .
8.11. Sale and Transfer of Advances; Participation
in Advances . . . . . . . . . . . . . . . . .
8.11.1. Assignments . . . . . . . . . . . . . . . . . .
8.11.2. Participation . . . . . . . . . . . . . . . . .
8.12. Other Transactions . . . . . . . . . . . . . . .
8.13. Forum Selection and Consent to Jurisdiction . .
8.14. Waiver of Jury Trial . . . . . . . . . . . . . .
8.15. No Recourse . . . . . . . . . . . . . . . . . .
8.16. Waiver of Immunity; Judgment Currency . . . . .
EXHIBIT A - Form of Advance Request
EXHIBIT B - Form of Supplier Assignment Agreement
EXHIBIT C - Form of Continuation Notice
EXHIBIT D - Form of Extension Request
EXHIBIT E - Form of Suppliers' Agreement
EXHIBIT F - Form of Opinion of Senior Legal Counsel to
the Consignor
EXHIBIT G - Form of Opinion of New York Counsel to
the Consignor
DOLLAR SUPPLY AGREEMENT
THIS DOLLAR SUPPLY AGREEMENT, dated as of September 28,
1994, among THE BANK OF NOVA SCOTIA ("Scotiabank") as consignor
(in such capacity, the "Consignor"), the various financial
institutions as are or may become parties hereto (collectively,
the "Suppliers"), SCOTIABANK, CHEMICAL BANK ("Chemical") and THE
BANK OF NEW YORK ("BONY") as the co-agents (in such capacity, the
"Co-Agents") for the Suppliers, and Scotiabank, as administrative
agent (in such capacity, together with any successor appointed
pursuant to Section 7.4, the "Administrative Agent") for the
Suppliers,
W I T N E S S E T H:
WHEREAS, the Consignor and Handy & Harman, a New York
corporation (the "Consignee"), are parties to a Fee Consignment
Agreement dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified pursuant to the terms
thereof, the "Fee Consignment Agreement"), pursuant to which the
Consignor will from time to time consign up to 110,000 troy
ounces of gold and up to 11,250,000 troy ounces of silver (such
gold and silver collectively referred to as the "Bullion"), all
in accordance with the terms and conditions thereof;
WHEREAS, the Suppliers will provide the Advance Commitment
pursuant to which each Supplier will make Advances of Dollars in
connection with consignments of Bullion by the Consignor to the
Consignee pursuant to the Fee Consignment Agreement; and
WHEREAS, the Suppliers are willing, on the terms and
conditions hereinafter set forth (including Article V), to make
such Advances and extend the Advance Commitment hereunder;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"Administrative Agent" is defined in the preamble.
"Advances" is defined in Section 2.1.1.
"Advance Commitment" is defined in Section 2.1.1.
"Advance Commitment Amount" means $125,375,000, as such
amount may be reduced from time to time pursuant to Section 2.2.
"Advance Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Advance Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2;
(c) the occurrence of any Default described in clauses
(a) through (d) of Section 6.1.3;
(d) the occurrence and continuance of any other Event
of Default and either
(i) the declaration of the Obligations of the
Consignee under the Fee Consignment Agreement to be due
and payable pursuant to Section 8.3 thereof, or
(ii) in the absence of such declaration, the
giving of notice by the Administrative Agent, acting at
the direction of the Required Suppliers, to the
Consignor and the Consignee that the Advance Commitment
has been terminated; and
(e) the occurrence of any Consignor Bankruptcy Event.
Upon the occurrence of any event described in clause (b), (c) or
(e) the Advance Commitment shall terminate automatically and
without further action.
"Advance Document" means this Agreement, each Advance
Request, each Extension Request, each Supplier Assignment
Agreement, the Suppliers' Agreement and each Continuation
Request.
"Advance Request" means a notice requesting Advances
executed and delivered by the Consignor, substantially in the
form of Exhibit A attached hereto.
"Affected Supplier" is defined in Section 4.3.
"Affiliate" is defined in the Revolving Credit Agreement.
"Agent" means, as the context may require, any Co-Agent or
the Administrative Agent.
"Agreement" means, on any date, this Dollar Supply Agreement
as originally in effect on the Effective Date and as thereafter
from time to time amended, supplemented, amended and restated or
otherwise modified and in effect on such date.
"Alternate Base Rate" means, on any date and with respect to
all Base Rate Advances, a fluctuating per annum rate equal to the
higher of
(a) the rate of interest most recently established by
Scotiabank at its Domestic Office as its base rate for
Dollar loans in the United States; and
(b) the Federal Funds Rate for such date plus 1/2 of
1%.
The Alternate Base Rate is not necessarily intended to be the
lowest rate of interest determined by Scotiabank in connection
with extensions of credit. Changes in Obligations accruing
interest at the Alternate Base Rate will take effect
simultaneously with each change in the Alternate Base Rate. The
Administrative Agent will give prompt notice to the Consignee and
the Suppliers of changes in the Alternate Base Rate.
"Assignee Supplier" is defined in Section 8.11.1.
"Authorized Officer" means those officers of the Consignee
whose signatures and incumbency shall have been certified to the
Administrative Agent and the Suppliers pursuant to Article V.
"Base Rate Advance" means each Advance pursuant to which the
Funding Fee accrues at a fluctuating rate determined by reference
to the Alternate Base Rate.
"BONY" is defined in the preamble.
"Bullion" is defined in the first recital.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to
be closed in New York, New York, U.S.A. or Toronto, Ontario,
Canada and on which dealings in Dollars are carried on in
the London interbank market; and
(b) in the case of any location to which Bullion is to
be delivered or received, a day that transactions in Bullion
can be carried out at such location.
"Chemical" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Consignee" is defined in the first recital.
"Consignor" is defined in the preamble.
"Consignor Bankruptcy Event" means the Consignor shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignor or any property of any thereof,
or make a general assignment for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignor or for a substantial part of the property of any
thereof;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignor; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing.
"Continuation Date" is defined in clause (a) of Section
3.1.3.
"Continuation Notice" means a notice of continuation duly
executed by the Consignor pursuant to the terms hereof,
substantially in the form of Exhibit C attached hereto.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Dollar" and the symbol "$" mean lawful money of the United
States.
"Domestic Office" means, relative to any Supplier, the
office of such Supplier designated as such below its signature
hereto or designated in the Supplier Assignment Agreement or such
other office of a Supplier (or any successor or assign of such
Supplier) within the United States as may be designated from time
to time by notice from such Supplier, as the case may be, to each
other party hereto.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 8.8.
"Environmental Law" is defined in the Revolving Credit
Agreement.
"Event of Default" is defined in Section 6.1.
"Extension Request" means an extension request duly executed
by the Consignor, substantially in the form of Exhibit D hereto.
"Federal Funds Rate" means, for any day, a fluctuating
interest rate per annum equal for such day to the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is not a
Business Day in the City of New York, for the next preceding
Business Day) by the Federal Reserve Bank of New York; provided,
however, that if such rate is not so published for any day which
is a Business Day in the City of New York, the rate for such day
shall be the average of the quotations for such day on such
transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it.
"Fee Consignment Agreement" is defined in the first recital.
"Fee Letter" is defined in the Revolving Credit Agreement.
"Funding Fee" is defined in Section 3.2.1.
"Funding Period" means, relative to any Advance, the period
beginning on (and including) the date on which such Advance is
made or continued as an Advance pursuant to Section 2.3 or 2.3.1
and shall end on (but exclude) the day which numerically
corresponds to such date one, two or three months (or such other
period, if agreed to by all the Suppliers) thereafter (or, if
such month has no numerically corresponding day, on the last
Business Day of such month), in each case equal to a
corresponding Consignment Period as requested by the Consignee
under the Fee Consignment Agreement as the Consignor will notify
to the Suppliers in its relevant notice pursuant to Section 2.3
or 2.3.1; provided, however, that
(a) Funding Periods commencing on the same date for
Advances in respect of the same consignment of Bullion shall
be of the same duration,
(b) if such Funding Period would otherwise end on a
day which is not a Business Day, such Funding Period shall
end on the next following Business Day; provided, however,
that if such next following Business Day is the first
Business Day of a calendar month, such Funding Period shall
end on the next preceding Business Day, and
(c) no Funding Period may end later than the Stated
Maturity Date.
No more than ten Funding Periods shall be in effect at any one
time.
"Hazardous Material" is defined in the Revolving Credit
Agreement.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Advance Document refer
to this Agreement or such other Advance Document, as the case may
be, as a whole and not to any particular Section, paragraph or
provision of this Agreement or such other Advance Document.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Advance Document, the parties hereto
agree that the rule of ejusdem generis shall not be applicable to
limit a general statement, which is followed by or referable to
an enumeration of specific matters or to matters specifically
mentioned.
"Indemnified Liabilities" is defined in Section 8.4.
"Indemnified Parties" is defined in Section 8.4.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Advance" means each Advance pursuant to which the
Funding Fee accrues at a rate determined by reference to the LIBO
Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, relative to any Supplier, the office
of such Supplier designated as such below its signature hereto or
designated in a Supplier Assignment Agreement or such other
office of a Supplier as designated from time to time by notice
from such Supplier to the Consignee and the Administrative Agent,
whether or not outside the United States, which shall be making
or maintaining LIBO Rate Advances.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or otherwise), charge against or interest in property
to secure payment of a debt or performance of an obligation or
other priority or preferential arrangement of any kind or nature
whatsoever.
"Non-Consenting Supplier" is defined in clause (c) of
Section 2.4.2.
"Non-Recourse Joint Venture" is defined in the Revolving
Credit Agreement.
"Obligations" means all obligations (monetary or otherwise)
of the Consignee arising under or in respect of the Fee
Consignment Agreement.
"Organic Document" means, relative to the Consignee, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Participant" is defined in Section 8.11.2.
"Percentage" means, relative to any Supplier, the percentage
set forth opposite its signature hereto or set forth in a
Supplier Assignment Agreement, as such percentage may be adjusted
from time to time pursuant to Supplier Assignment Agreement(s)
executed by such Supplier and its Assignee Supplier(s) and
delivered pursuant to Section 8.11.1.
"Person" means any natural person, corporation, partnership,
firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or other
capacity.
"Quarterly Payment Date" means the last day of each March,
June, September and December or, if any such day is not a
Business Day, the next succeeding Business Day.
"Release" is defined in the Revolving Credit Agreement.
"Replacement Notice" is defined in Section 4.10.
"Required Suppliers" means, at any time, Suppliers whose
Percentages equal or exceed 51%.
"Revolving Credit Agreement" means the Revolving Credit
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof), among the Consignee, certain
financial institutions from time to time parties thereto,
Chemical, BONY and Scotiabank as co-agents and Scotiabank, as the
administrative agent; provided that if the Revolving Credit
Agreement shall be refinanced or otherwise terminated and no
longer of force and effect at a time when this Agreement is still
in effect, then for purposes of this Agreement the "Revolving
Credit Agreement" shall mean the Revolving Credit Agreement, as
in effect immediately prior to the date of such refinancing or
termination.
"Scotiabank" is defined in the preamble.
"Short-Term Dollar Supply Agreement" means the Short-Term
Dollar Supply Agreement, dated as of the date hereof, among the
Consignor, the financial institutions from time to time parties
thereto, Scotiabank, BONY and Chemical, as co-agents and
Scotiabank, as administrative agent, as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof.
"Short Term Revolving Credit Agreement" is defined in the
Revolving Credit Agreement.
"Stated Maturity Date" means September 28, 1997, as such
date may be extended from time to time pursuant to Section 2.4.
"Subject Supplier" is defined in Section 4.10.
"Subsidiary" means, with respect to any Person, any
corporation of which more than 50% of the outstanding capital
stock having ordinary voting power to elect a majority of the
board of directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence
of any contingency) is at the time directly or indirectly owned
by such Person, by such Person and one or more other Subsidiaries
of such Person, or by one or more other Subsidiaries of such
Person.
"Substitute Rate" is defined in Section 3.2.1.
"Supplier Assignment Agreement" means a Supplier Assignment
Agreement substantially in the form of Exhibit B attached hereto.
"Suppliers" is defined in the preamble.
"Suppliers' Agreement" means the Suppliers' Agreement, dated
as of the date hereof (as amended, supplemented, amended and
restated or otherwise modified from time to time pursuant to the
terms thereof), among the Consignor, the Suppliers (as defined
herein and in the Short-Term Dollar Supply Agreement) and the
Administrative Agent, substantially in the form attached hereto
as Exhibit E.
"Taxes" is defined in Section 4.6.
"type" means, relative to any Advance, the portion thereof,
if any, being maintained as a Base Rate Advance or a LIBO Rate
Advance.
"United States" or "U.S." means the United States of
America, its fifty States and the District of Columbia.
"Valuation Date" is defined in clause (a) of Section 3.1.3.
SECTION 1.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires,
(a) terms for which meanings are provided in this
Agreement shall have such meanings when used in any Advance
Document, notice and other communication delivered from time
to time in connection with this Agreement or any other
Advance Document; and
(b) terms used in this Agreement or any Advance
Document that are not defined herein (or in such Advance
Document) are used herein with the meanings set forth in the
Fee Consignment Agreement.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Advance Document
to any Article or Section are references to such Article or
Section of this Agreement or such other Advance Document, as the
case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to
such clause of such Article, Section or definition.
ARTICLE II
ADVANCE COMMITMENT AND MAKING OF ADVANCES
SECTION 2.1. Advance Commitment. On the terms and subject
to the conditions of this Agreement (including Article V), each
Supplier severally agrees to make Advances to the Consignor
pursuant to the Advance Commitment described in Section 2.1.1;
provided, that all payments and repayments of such Advances are
subject to the terms of Section 8.15.
SECTION 2.1.1. Advance Commitment. From time to time on
any Business Day occurring prior to the Advance Commitment
Termination Date, each Supplier will advance Dollars to the
Administrative Agent to be forwarded to the Consignor (relative
to such Supplier, its "Advances") equal to such Supplier's
Percentage of the aggregate amount of the Advances required
pursuant to Section 2.3 or Section 2.3.1 to be made on such day.
The commitment of each Supplier described in this Section 2.1.1
is herein referred to as its "Advance Commitment". On the terms
and subject to the conditions hereof, the Consignor may from time
to time prior to the Advance Commitment Termination Date have
Advances funded to it, prepay such Advances following the return
or purchase of Bullion (or other gold or silver) by the Consignee
under the Fee Consignment Agreement and have additional Advances
funded to it in connection with consignments of Bullion
thereunder.
SECTION 2.1.2. Suppliers Not Permitted or Required to Make
Advances. No Supplier shall be permitted or required to make any
Advance if, after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(a) to all Suppliers would exceed the Advance
Commitment Amount; or
(b) to such Supplier would exceed such Supplier's
Percentage multiplied by the Advance Commitment Amount.
SECTION 2.2. Reduction of Advance Commitment Amount. Upon
the occurrence of a voluntary reduction in whole or in part of
the Commitment Amount pursuant to Section 2.2.1 of the Fee
Consignment Agreement, there shall also occur an automatic and
contemporaneous reduction in the Advance Commitment Amount
hereunder in an amount equal to the number of troy ounces of gold
or troy ounces of silver (or both, if applicable) by which the
Commitment Amount under the Fee Consignment Agreement is being
reduced, multiplied by $475 (in the case where a reduction in the
Commitment Amount is in respect of gold) and $6.50 (in the case
where a reduction in the Commitment Amount is in respect of
silver).
SECTION 2.3. Advance Procedures and Funding. Promptly
following receipt of a Consignment Request from the Consignee,
the Consignor agrees to deliver an Advance Request for a Funding
Period that is the same duration of the requested Consignment
Period to the Administrative Agent pursuant to which the
Consignor will request, on at least three but no more than five
Business Days' prior notice, that an Advance be made by all the
Suppliers in a minimum amount of $10,000,000, or, if less, in the
unused amount of the Advance Commitment Amount. In connection
with any consignment of Bullion under the Fee Consignment
Agreement, the Consignor shall not agree to a Consignment Period
of other than one, two or three months unless all the Suppliers
have first consented to such other Consignment Period. The
Administrative Agent agrees to promptly notify each Supplier of
the receipt of each Advance Request. The amount of the Advance
in respect of any given Consignment Request shall equal the
Dollar Value of gold or the Dollar Value of silver (or both, if
applicable as determined by the Consignor and notified to the
Administrative Agent) as in effect three Business Days prior to
the making of the Advance, multiplied by the number of troy
ounces of gold or troy ounces of silver (or both, if applicable)
that the Consignee is requesting be consigned to it by the
Consignor. On the terms and subject to the conditions of this
Agreement, each Advance shall be made on the Business Day
specified in such Advance Request. On or before 11:00 a.m.
(New York City time) on the Business Day that such Advance is to
be made, each Supplier shall deposit with the Administrative
Agent immediately available funds in an amount equal to such
Supplier's Percentage of the requested Advance. Such deposit
will be made to an account which the Administrative Agent shall
specify from time to time by notice to the Suppliers. No
Supplier's obligation to make any Advance shall be affected by
any other Supplier's failure to make any Advance.
SECTION 2.3.1. Continuation Elections. Promptly following
the delivery of a Continuation/Return Notice to the Consignor in
accordance with Section 2.3.1 of the Fee Consignment Agreement in
which the Consignee is requesting that all or any portion of
previously consigned Bullion is to remain consigned to the
Consignee pursuant to the terms of the Fee Consignment Agreement,
the Consignor will deliver to the Administrative Agent a
Continuation Notice with respect to the previously funded
corresponding Advances that were made hereunder, pursuant to
which the Suppliers shall continue all, or any applicable portion
of, such Advances following the last day of a Funding Period with
respect thereto (subject to Sections 4.1, 4.2 and 4.3) as a LIBO
Rate Advance, and in the absence of delivery of a
Continuation/Return Notice with respect to any Advance at least
four but not more than five Business Days prior to the last day
of the then current Funding Period with respect thereto, such
Advance shall, on such last day, automatically continue for a
Funding Period of one month and, in such event, the Consignor
will deliver to the Administrative Agent a Continuation Notice
with respect to the previously funded corresponding Advances that
were made hereunder, pursuant to which the Suppliers shall,
subject to the satisfaction of the conditions set forth in
Section 5.2.5, continue all such Advances following the last day
of the then expiring Funding Period with respect thereto (subject
to Sections 4.1, 4.2 and 4.3) as a LIBO Rate Advance for a
Funding Period of one month. The amount of the Advances in
respect of any such Continuation Notice shall equal the Dollar
Value of gold or the Dollar Value of silver (or both, if
applicable) as in effect three Business Days prior to the
continuation of the Advance, multiplied by the number of troy
ounces of gold or troy ounces of silver (or both, if applicable)
that the Consignee has requested be continued under consignment
by the Consignor. To the extent such Dollar Value of gold or
Dollar Value of silver (as applicable) three Business Days prior
to the first day of the next succeeding Funding Period as
notified to the Administrative Agent and the Suppliers by the
Consignor
(a) exceeds that which was in effect three Business
Days prior to the date the relevant consignment was
originally made (or subsequently continued pursuant to
Section 2.3.1 of the Fee Consignment Agreement), then the
Suppliers shall (subject to Section 5.2.5) fund Advances to
the Administrative Agent on the first day of such next
succeeding Funding Period in an amount equal to such
Supplier's Percentage multiplied by such excess; and
(b) is less than that which was in effect three
Business Days prior to the date the relevant consignment was
originally made (or subsequently continued pursuant to
Section 2.3.1 of the Fee Consignment Agreement), then the
Consignor shall repay Advances to the Administrative Agent
on the last day of the then expiring Funding Period in an
amount equal to such difference pursuant to clause (a) of
Section 3.1.3.
SECTION 2.3.2. Funding. Each Supplier may, if it so
elects, fulfill its obligation to advance or continue LIBO Rate
Advances hereunder by causing one of its foreign branches or
affiliates (or an international banking facility created by such
Supplier) to advance or continue such LIBO Rate Advance;
provided, however, that such LIBO Rate Advance shall nonetheless
be deemed to have been made and to be held by such Supplier, and
the obligation to repay such LIBO Rate Advance shall nevertheless
be to such Supplier for the account of such foreign branch,
affiliate or international banking facility.
SECTION 2.4. Extension of Stated Maturity Date and Maturity
of Advances. Each of (i) the Stated Maturity Date and (ii) the
obligation, pursuant to Section 3.1.1, to make a mandatory
repayment of the outstanding principal amount of Advances on the
Stated Maturity Date, shall be subject to extension or
postponement, as the case may be, as set forth in this Section.
SECTION 2.4.1. Request for Extension of Stated Maturity
Date and Maturity of Advances. Any term or provision of this
Agreement to the contrary notwithstanding, promptly after the
delivery of a Consignment Extension Request by the Consignee to
the Consignor pursuant to the terms of the Fee Consignment
Agreement in respect of which the Consignor is willing to extend
the Stated Maturity Date, the Consignor shall, by delivery of a
duly completed Extension Request to each Supplier, irrevocably
request that each Supplier extend for a one year period the then
existing Stated Maturity Date.
SECTION 2.4.2. Consent to Extension of Stated Maturity Date
and Maturity of Advances.
(a) Each Supplier shall, within 30 days of receipt of
an Extension Request, notify the Administrative Agent
whether or not it consents to the extension set forth in
such Extension Request, such consent to be in the sole
discretion of such Supplier. If any Supplier does not so
notify the Administrative Agent of its decision within such
30 day period, such Supplier shall be deemed not to have
consented to such request.
(b) The Administrative Agent shall promptly notify the
Consignor and the Consignee whether the Suppliers have
consented to such request. If the Administrative Agent does
not so notify the Consignor within 35 days following the
date the Consignor receives the applicable Consignment
Extension Request from the Consignee, the Administrative
Agent shall be deemed to have notified the Consignor that
the Suppliers have not consented to such request.
(c) Each Supplier that elects not to provide a new
Advance Commitment upon the expiration of the then effective
Stated Maturity Date or that fails to so notify the
Administrative Agent of such consent (a "Non-Consenting
Supplier") hereby agrees that if, on or prior to the then
effective Stated Maturity Date, any other Supplier or other
financial institution acceptable to the Consignor and the
Consignee offers to purchase such Non-Consenting Supplier's
Percentage of the Advance Commitment (and other amounts and
commitments, as required pursuant to Section 8.11.1) for a
purchase price equal to the sum of all amounts then owing
with respect to the Advances and all other amounts accrued
for the account of such Non-Consenting Supplier, such Non-
Consenting Supplier will assign, sell and transfer on the
then effective Stated Maturity Date all of its right, title,
interest and obligations with respect to the foregoing to
such other Supplier or financial institution pursuant to the
terms of Section 8.11.1, and the fee payable pursuant to
Section 8.11.1 shall be payable by such Assignee Supplier.
(d) The Advances of any Non-Consenting Supplier that
were not purchased pursuant to clause (c) will mature and be
due and payable, and such Non-Consenting Supplier's Advance
Commitment will terminate, on the then scheduled Stated
Maturity Date. On each such date, the Advance Commitment
Amount will be automatically reduced by an amount equal to
the product of
(i) the sum of the Percentages of all Non-
Consenting Suppliers that were not purchased pursuant
to clause (c), and
(ii) the Advance Commitment Amount (whether used
or unused) on such Stated Maturity Date immediately
prior to such calculation.
(e) On the date that would have been the Stated
Maturity Date had the Advance Commitment not been extended
pursuant to the terms of this Section, the Percentages of
the remaining Suppliers which have consented to an extension
of their Advance Commitment hereunder shall be adjusted
accordingly by the Administrative Agent, based on such
Suppliers' pro rata share of the remaining Advance
Commitment Amount.
Notwithstanding anything to the contrary contained in this
Section, the Stated Maturity Date of those Suppliers consenting
to such an extension shall not be extended for an additional one
year period unless (i) Suppliers whose Percentages equal or
exceed 75% (after giving effect to the operation of clause (c))
have so consented to such extension, and (ii) the Consignor has
consented to a corresponding extension of the Consignment
Maturity Date pursuant to Section 2.4.2 of the Fee Consignment
Agreement.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. Repayments and
prepayments of Advances shall be made as set forth in this
Section 3.1. Each repayment or prepayment of any Advance made
pursuant to this Section 3.1 shall be without premium or penalty,
except as may be required to be paid (subject to Section 8.15)
pursuant to Section 4.4. No prepayment of principal of any
Advances shall cause a reduction in the Advance Commitment
Amount. Notwithstanding anything to the contrary in this
Agreement or any other Advance Document, the parties hereto
acknowledge and agree that (other than as required pursuant to
clauses (a) and (e) of Section 3.1.3) each repayment and
prepayment of Advances by the Consignor to the Suppliers, and all
liability of the Consignor to the Suppliers in respect of such
payments, shall be subject to the provisions of Section 8.15 and
shall only arise as against the Consignor to the extent (and only
to the extent) that Bullion (or other gold and/or silver, as
applicable) has been purchased by the Consignee from the
Consignor (and the Consignor shall have received in immediately
available funds the purchase price of such Bullion) or has been
returned to the Consignor by the Consignee as required on the
dates and in accordance with the terms of the Fee Consignment
Agreement; provided, that if the full amount of Bullion (or
other gold and/or silver, as applicable) is returned to the
Consignor, or the Consignor receives the entire amount of the
purchase price agreed to in respect of a purchase of such
Bullion, in each case on a date that is later than that which is
required pursuant to the terms of the Fee Consignment Agreement,
then the Consignor agrees that it will make the payments
otherwise required pursuant to Section 3.1.3 on the date such
Bullion was returned or purchased, as the case may be.
SECTION 3.1.1. Final Maturity. To the extent (but only to
the extent) that all then consigned Bullion (or other gold and/or
silver, as applicable) is returned from consignment to the
Consignor and/or purchased by the Consignee on such date in
accordance with the terms of the Fee Consignment Agreement, on
the Stated Maturity Date, the Consignor shall repay the unpaid
principal amount of all Advances upon the Stated Maturity Date.
If less than all previously consigned Bullion (or other gold
and/or silver, as applicable) is returned from consignment or is
purchased by the Consignee pursuant to the terms of the Fee
Consignment Agreement on the Stated Maturity Date, then as
between the Consignor and the Suppliers the terms of the
Suppliers' Agreement shall be applied to determine the principal
amount of the Advances that will be repaid to the Suppliers on
the Stated Maturity Date (provided, that the Consignee's failure
to return (or purchase, as applicable) all Bullion on the Stated
Maturity Date shall nevertheless constitute an Event of Default,
and any acceptance of any partial repayment or return of Bullion
(as applicable) shall not be deemed to be a waiver of any terms
or provisions of, or otherwise release the Consignee from
complete performance of its Obligations under, the Fee
Consignment Agreement).
SECTION 3.1.2. Acceleration of Stated Maturity Date. Upon
any acceleration of the Stated Maturity Date pursuant to Section
6.2 or Section 6.3 the Consignor shall, to the extent (and only
to the extent) that all previously consigned Bullion (or other
gold and/or silver, as applicable) has first been returned to it
from consignment by the Consignee, or has been purchased from the
Consignor by the Consignee pursuant to the terms of the Fee
Consignment Agreement, repay the outstanding amount of all
Advances on the date of such delivery or purchase of Bullion (or
other gold and/or silver). If, upon (or at any time after) the
acceleration of the Stated Maturity Date pursuant to Section 6.2
or Section 6.3, the Consignee shall return to or purchase from
the Consignor less than all previously consigned Bullion (or
other gold and/or silver, as applicable), then as between the
Consignor and the Suppliers the terms of the Suppliers' Agreement
shall be applied to determine the principal amount of the
Advances that will be repaid upon such return to or purchase from
the Consignor (provided, that the Consignee's failure to return
(or purchase, as applicable) all Bullion on the date of any
acceleration of the Stated Maturity Date shall nevertheless
constitute an Event of Default, and any acceptance of any partial
repayment or return of Bullion (as applicable) shall not be
deemed to be a waiver of any terms or provisions of, or otherwise
release the Consignee from complete performance of its
Obligations under, the Fee Consignment Agreement).
SECTION 3.1.3. Mandatory Prepayments of Advances. The
Consignor shall make mandatory prepayments of the Advances as
follows:
(a) to the extent that the Dollar Value of gold or the
Dollar Value of silver (or both, if applicable) on the date
that is three Business Days prior to the continuation of a
consignment of all or a portion of Bullion pursuant to
Section 2.3.1 of the Fee Consignment Agreement (such date
being referred to as the "Continuation Date") is less than
that which was in effect three Business Days prior to when
the relevant consignment (and the corresponding Funding
Period hereunder with respect to such consignment) was
originally made or, if applicable, subsequently continued
pursuant to Section 2.3.1 of the Fee Consignment Agreement
(such date being referred to as the "Valuation Date"), the
Consignor shall repay the Advances on the last day of such
then expiring Funding Period, pro rata to the Suppliers in
accordance with their respective Percentages, in an amount
equal to (i) the Dollar Value of gold or the Dollar Value of
silver (or both, if applicable) that existed on the
Valuation Date, multiplied (as applicable) by the number of
ounces of gold and/or the number of ounces of silver that
was consigned under the corresponding Consignment Period
minus (ii) the Dollar Value of gold or the Dollar Value of
silver (or both, if applicable) that existed on the
Continuation Date multiplied (as applicable) by the number
of ounces of gold and/or the number of ounces of silver to
be continued under consignment pursuant to the relevant
Continuation/Return Notice;
(b) on each date when Bullion is purchased from the
Consignor by the Consignee pursuant to the terms of
Section 2.3.3 of the Fee Consignment Agreement, regardless
of the price agreed to between the Consignor and the
Consignee, the Consignor shall make a mandatory prepayment
of Advances in an amount equal to the Dollar Value of gold
or the Dollar Value of silver (or both, if applicable) that
was in effect on the Valuation Date corresponding to the
applicable Consignment Period of the Bullion that is being
purchased, multiplied by the number of ounces of Bullion so
purchased;
(c) on the last day of each Consignment Period when
Bullion (or other gold or silver, as applicable) is returned
(and not continued under consignment) to the Consignor by
the Consignee, the Consignor shall make a mandatory
prepayment of Advances in an amount equal to the Dollar
Value of gold or the Dollar Value of silver (or both, if
applicable) that was in effect on the Valuation Date
corresponding to such applicable Consignment Period in
respect of which gold or silver is being returned to the
Consignor, multiplied by the number of ounces of gold and/or
silver actually returned to the Consignor;
(d) on each date and to the extent that the Consignee
has returned Bullion to the Consignor (or delivered to the
Consignor other gold or silver, as applicable) prior to the
last day of the related Consignment Period in accordance
with Section 3.1.2 of the Fee Consignment Agreement or
Bullion has been deemed to have been returned to the
Consignor pursuant to clause (b)(i) of Section 3 of the
Suppliers' Agreement, the Consignor shall make a mandatory
prepayment of Advances equal to the Dollar Value of gold or
the Dollar Value of silver (or both, if applicable) that was
in effect on the Valuation Date corresponding to such
Consignment Period, multiplied by the number of ounces of
gold and/or silver actually returned or deemed returned to
the Consignor; and
(e) on each date and to the extent that (i) any Bullion
with respect to which the Suppliers have made Advances is
lost or damaged prior to its delivery to either Plant (as
set forth in Section 2.3 of the Fee Consignment Agreement),
or (ii) any Bullion is returned to the Consignor by the
Consignee as not conforming with the quality of gold or
silver, as the case may be, as set forth in Section 2.3.2 of
the Fee Consignment Agreement, the Consignor shall make a
mandatory repayment of Advances in an amount equal to the
Dollar Value of gold or the Dollar Value of silver (or both,
if applicable) that was in effect on the Valuation Date
corresponding to the Consignment Period in respect of the
gold or silver that was lost or damaged prior to delivery to
either Plant or that was otherwise not in conformity with
the quality required pursuant to Section 2.3.2 of the Fee
Consignment Agreement, as the case may be, together with
interest which shall be the several obligation of, and
payable by, the Consignor on the amount of such Advances at
the rate customarily charged for inter-bank loans in the
U.S. for the first two days such Advances were outstanding,
and thereafter for each day such Advances are outstanding at
the rate that would have accrued on such Advances as a
Funding Fee if such Bullion had not been lost, damaged or
returned.
SECTION 3.2. Fees. Fees on the Advances shall accrue and
be payable in accordance with this Section 3.2 (and payment of
all such fees shall be subject to the provisions of Section
8.15).
SECTION 3.2.1. Funding Fee. To the extent that the
Consignor has first received the Consignment Fee from the
Consignee payable pursuant to Section 3.3.1 of the Fee
Consignment Agreement, the Consignor agrees to pay to the
Suppliers a funding fee (the "Funding Fee") on each Advance at a
rate equal to the sum of the LIBO Rate (Reserve Adjusted) for the
applicable Funding Period plus a margin of 1/2 of 1% per annum;
provided, however, that if, as a result of the occurrence of any
event described in Section 4.2, Advances are maintained at the
Alternate Base Rate, then the Funding Fee payable by the
Consignor shall equal the rate which Scotiabank notifies the
Consignee, the Administrative Agent and the Suppliers is the rate
at which Dollar deposits in immediately available funds are
offered to it in an interbank market other than the London
interbank eurodollar market, as reasonably selected by
Scotiabank, including all basic, emergency, supplemental,
marginal and other reserves specified under regulations issued
from time to time by the F.R.S. Board and then applicable to
assets or liabilities of the nature selected by Scotiabank having
a term approximately equal or comparable to applicable Funding
Period (the "Substitute Rate"), plus a margin of 1/2 of 1% per
annum. If only a percentage of the total Consignment Fee is paid
to the Consignor under Section 3.3.1 of the Fee Consignment
Agreement, then the Consignor agrees to pay over to the
Administrative Agent a Funding Fee in an amount equal to the
total amount of the Funding Fee otherwise due multiplied by the
percentage of the Consignment Fee so received by the Consignor
(but the Consignee's failure to pay the entire amount of the
Consignment Fee shall constitute an Event of Default, and the
acceptance of any partial payment of the Consignment Fee shall
not be deemed to be a waiver of, or otherwise release the
Consignee from complete performance of its Obligations under, the
Fee Consignment Agreement).
The "LIBO Rate (Reserve Adjusted)" means, relative to any
Advance to be made, continued or maintained as, or converted
into, a LIBO Rate Advance for any Funding Period, a rate per
annum (rounded upwards, if necessary, to the nearest 1/16 of 1%)
determined pursuant to the following formula:
LIBO Rate = LIBO Rate
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Funding Period for
LIBO Rate Advances will be determined by the Administrative Agent
on the basis of the LIBOR Reserve Percentage in effect on, and
the applicable rates furnished to and received by the
Administrative Agent from Scotiabank two Business Days before,
the first day of such Funding Period.
"LIBO Rate" shall equal the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at
which Dollar deposits in immediately available funds are offered
to Scotiabank's LIBOR Office in the London interbank market as at
or about 11:00 a.m. (London time), two Business Days prior to the
beginning of such Funding Period for delivery on the first day of
such Funding Period, and in an amount approximately equal to the
amount of Scotiabank's LIBO Rate Advance, for a period
approximately equal to such Funding Period.
"LIBOR Reserve Percentage" means the reserve percentage
(expressed as a decimal) equal to the average maximum reserve
requirements of the Suppliers (without giving effect to the
branch or agency in which such Supplier funds such Advances)
(including all basic, emergency, supplemental, marginal and other
reserves and taking into account any transitional adjustments or
other scheduled changes in reserve requirements) specified under
regulations issued from time to time by the F.R.S. Board and then
applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D
of the F.R.S. Board, having a term approximately equal or
comparable to such Funding Period.
For so long as any Advances of a Supplier are maintained as
Base Rate Advances as a result of the occurrence of any event
described in Section 4.1 or 4.3, the Consignor shall (subject in
all respects to the terms of this Agreement) continue to pay such
Supplier the Funding Fee, at the LIBO Rate (Reserve Adjusted) for
the applicable Funding Period plus a margin of 1/2 of 1% per
annum, and to the extent (and only to the extent) that the
Consignor has first received from the Consignee all or a portion
of the fees payable pursuant to clause (b) of Section 3.3.1 of
the Fee Consignment Agreement, the Consignor agrees to also pay
over (to the extent actually received) a fee to such Supplier on
such Advances at a rate equal to the positive difference, if any,
between (x) the Alternate Base Rate then in effect and (y) the
LIBO Rate (Reserve Adjusted) for the Funding Period in respect of
such Advances plus 1/2 of 1% per annum, with all such amounts
being due and payable on the dates the Funding Fee is otherwise
payable hereunder. For so long as any Advances of the Suppliers
are maintained as Base Rate Advances as a result of the
occurrence of any event described in Section 4.2, the Consignor
shall (subject in all respects to the terms of this Agreement)
continue to pay each Supplier the Funding Fee, at the Substitute
Rate for the applicable Funding Period plus a margin of 1/2 of 1%
per annum, and to the extent (and only to the extent) that the
Consignor has first received from the Consignee all or a portion
of the fees payable pursuant to clause (b) of Section 3.3.1 of
the Fee Consignment Agreement, the Consignor agrees to also pay
over (to the extent actually received) a fee to such Supplier on
such Advances at a rate equal to the positive difference, if any,
between (x) the Alternate Base Rate then in effect and (y) the
Substitute Rate for the Funding Period in respect of such
Advances plus 1/2 of 1% per annum, with all such amounts being
due and payable on the dates the Funding Fee is otherwise payable
hereunder. The Funding Fee shall accrue on all Advances from and
including the first day of the applicable Funding Period to (but
not including) the last day of such Funding Period. To the
extent received, the Funding Fee will be paid by the Consignor to
the Administrative Agent for the account of the Suppliers in
arrears on (a) the Stated Maturity Date, (b) on the last day of
each Funding Period (or on each three-month anniversary of a
Funding Period, for Funding Periods in excess of 3 months), and
(c) on the date of any reduction in the Advance Commitment Amount
resulting from a reduction in the Commitment Amount pursuant to
Section 2.2.1 or 2.2.2 of the Fee Consignment Agreement, in an
amount equal to any accrued Funding Fee on that portion of the
Commitment Amount being reduced.
SECTION 3.2.2. Commitment Fees. To the extent (and only to
the extent) the Consignor first receives all or a portion of the
fees payable pursuant to Section 3.3.2 of the Fee Consignment
Agreement, the Consignor agrees (subject to the terms of this
Agreement) to pay over (to the extent so received) to the
Administrative Agent, for the account of the Suppliers, a
commitment fee equal to 1/5 of 1% per annum multiplied by the
product of (a) the difference between (i) the average daily
number of ounces of gold or silver committed to be consigned
under the Fee Consignment Agreement (based on the Dollar Value of
gold equalling $475 per ounce and the Dollar Value of silver
equalling $6.50 per ounce) during the relevant period and
(ii) the average daily number of ounces of gold or silver, as the
case may be, actually consigned under the Fee Consignment
Agreement during the relevant period and (b) $475 (in the case of
gold) and $6.50 (in the case of silver). The commitment fee is
payable in arrears on each Quarterly Payment Date and on the
Advance Commitment Termination Date.
SECTION 3.2.3. Post-Maturity Rates. After the date any
amount (other than the Advances) payable by the Consignor shall
have become due and payable (or would become due and payable had
a corresponding payment been made by the Consignee) hereunder, in
each case as a result of a breach by the Consignee of its
obligations under any Fee Consignment Document, the Consignor
agrees, subject to the provisions of Section 8.15, to pay over to
the Administrative Agent any interest it receives from the
Consignee (after as well as before judgment) on such amounts at a
rate equal to the Alternate Base Rate plus a margin of 2% per
annum. In addition, to the extent that the Consignee fails to
return (or purchase) any Bullion on the dates and in the manner
required pursuant to the terms of the Fee Consignment Agreement,
the Consignor agrees (subject to the terms hereof) to the extent
that it has first received the ABR Fee from the Consignee payable
pursuant to the second sentence of Section 3.2 of the Fee
Consignment Agreement that it shall pay to the Suppliers on the
date received instead of the Funding Fee an amount equal to the
Alternate Base Rate plus a margin of 2% per annum on the
principal amount of the Advances due but unpaid. If only a
percentage of the total ABR Fee is paid to the Consignor pursuant
to the second sentence of Section 3.2 of the Fee Consignment
Agreement, then the Consignor agrees to pay over to the
Administrative Agent an amount equal to the Alternate Base Rate
plus a margin of 2% per annum on the principal amount of the
Advances due but unpaid multiplied by the percentage of such ABR
Fee so received by the Consignor (but the Consignee's failure to
pay the entire amount of such ABR Fee shall nevertheless
constitute an Event of Default, and the acceptance of any partial
payment of any such ABR Fee shall not be deemed to be a waiver
of, or otherwise release the Consignee from complete performance
of its Obligations under, the Fee Consignment Agreement).
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Supplier
shall determine (which determination shall, upon notice thereof
to the Administrative Agent (which notice the Administrative
Agent agrees it will as promptly as practicable forward to the
Consignor and the Consignee), absent manifest error, be prima
facie evidence of the facts stated therein) that the introduction
of or any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority
asserts that it is unlawful, for such Supplier to make, continue
or maintain any Advance as, or to convert any Advance into, a
LIBO Rate Advance, the obligations of such Supplier to make,
continue, maintain or convert any such Advances shall, upon such
determination, forthwith be suspended until such Supplier shall
notify the Administrative Agent that the circumstances causing
such suspension no longer exist (which notification such Supplier
agrees to give as promptly as practicable when such circumstances
no longer exist), and all LIBO Rate Advances of such Supplier
shall automatically convert into Base Rate Advances at the end of
the then current Funding Periods with respect thereto or sooner,
if required by such law or assertion. Upon any Advances being
made, continued or maintained as, or converted into, Base Rate
Advances by a Supplier (a) the Consignor shall (subject to the
terms of this Agreement) continue to pay a Funding Fee thereon at
a rate equal to the LIBO Rate (Reserve Adjusted) plus a margin of
1/2 of 1% per annum, and (b) the Consignor, to the extent (and
only to the extent) that the Consignor has first received the
fees payable pursuant to clause (b) of Section 3.3.1 of the Fee
Consignment Agreement, agrees (subject to the terms of this
Agreement) to pay over to such Supplier on the dates the Funding
Fee is due and payable pursuant to Section 3.2.1 a fee on such
Advances at a rate equal to the positive difference, if any,
between (x) the Alternate Base Rate from time to time in effect
and (y) the LIBO Rate (Reserve Adjusted) for the Funding Period
in respect of such Advances plus a margin of 1/2 of 1% per annum.
SECTION 4.2. Deposits Unavailable. If the Administrative
Agent shall have determined that
(a) Dollar deposits in the relevant amount and for the
relevant Funding Period are not available to Scotiabank in
its relevant market; or
(b) by reason of circumstances affecting Scotiabank or
the relevant market, adequate means do not exist for
ascertaining the rate applicable hereunder to LIBO Rate
Advances,
then, upon notice from the Administrative Agent to the Consignor,
the Consignee and the Suppliers, the obligations of all Suppliers
under Section 2.3 and Section 2.3.1 to make or continue any
Advances as, or to convert any Advances into, LIBO Rate Advances
shall forthwith be suspended until Scotiabank shall notify the
Consignor, the Consignee and the Suppliers that the circumstances
causing such suspension no longer exist, and such Advances shall
thereafter be maintained as Base Rate Advances. Upon any
Advances being maintained as Base Rate Advances pursuant to the
terms of this Section, (a) the Consignor shall (subject to the
terms of this Agreement) continue to pay a Funding Fee thereon at
the Substitute Rate plus a margin of 1/2 of 1% per annum, and (b)
the Consignor, to the extent (and only to the extent) that the
Consignor has first received the fees payable pursuant to clause
(b) Section 3.3.1 of the Fee Consignment Agreement, agrees to pay
over to each Supplier on the dates the Funding Fee is due and
payable pursuant to Section 3.2.1 a fee on such Advances at a
rate equal to the positive difference, if any, between (x) the
Alternate Base Rate from time to time in effect and (y) the
Substitute Rate for the Funding Period in respect of such
Advances plus a margin of 1/2 of 1% per annum.
SECTION 4.3. Increased LIBO Rate Advance Costs, etc.
Subject to the terms of this Agreement, the Consignor agrees to
pay over to each Supplier (to the extent (and only to the extent)
first received by the Consignor) any increase in the cost to such
Supplier of, or any reduction in the amount of any sum receivable
by such Supplier in respect of, making, continuing or maintaining
(or of its obligation to make, continue or maintain) any Advances
as, or of converting (or of its obligation to convert) any
Advances into, LIBO Rate Advances. Such Supplier shall promptly
notify the Administrative Agent in writing of the occurrence of
any such event (which notice the Administrative Agent agrees it
will as promptly as practicable forward to the Consignor and the
Consignee), such notice to state, in reasonable detail, the
reasons therefor and the additional amount required fully to
compensate such Supplier for such increased cost or reduced
amount, and such notice shall, in the absence of manifest error,
be prima facie evidence of the matters stated therein. Subject
to the terms of this Agreement, such additional amounts shall be
paid over by the Consignor to such Supplier promptly, and in any
event within five days of the Consignor's receipt of a like
amount of such payment pursuant to Section 9.3 of the Fee
Consignment Agreement. If increased costs are requested by any
Supplier (the "Affected Supplier") pursuant to this Section, the
Consignor may (and upon the instructions of the Consignee shall),
by telephonic notice (promptly confirmed in writing) to the
Administrative Agent (which shall give prompt notice thereof to
the Affected Supplier),
(a) as to any outstanding LIBO Rate Advances of such
Affected Supplier, be deemed to have prepaid such Advance in
full, without premium or penalty (other than as may be
provided in Section 4.4, and then only to the extent first
paid to the Consignor by the Consignee pursuant to Section
9.3 of the Fee Consignment Agreement), and, to the extent
first paid to the Consignor by the Consignee pursuant to
Section 9.3 of the Fee Consignment Agreement, pay over to
the Affected Supplier such increased costs as well as any
accrued Funding Fee, to the date of such deemed prepayment
on the principal amount prepaid, without simultaneously
making a prepayment of the Advances of each other Supplier
and simultaneously have each Advance which is deemed prepaid
accrue at the Alternate Base Rate in an equal principal
amount (without the necessity that the conditions set forth
in Section 5.2 are met); and
(b) with respect to any Advance Request or
Continuation Notice, request such Affected Supplier (i) to
make the applicable Advance then or thereafter subject to an
Advance Request as an Advance accruing at the Alternate Base
Rate, or (ii) to maintain the outstanding Base Rate Advance
or LIBO Rate Advance of such Supplier then or thereafter the
subject of a Continuation Notice as a Base Rate Advance;
provided, however, that in each case upon any Advance being
maintained as a Base Rate Advance pursuant to the terms of this
Section, (i) the Consignor shall (subject to the terms of this
Agreement) continue to pay a Funding Fee thereon at the LIBO Rate
(Reserve Adjusted) plus a margin of 1/2 of 1% per annum, and (ii)
the Consignor, to the extent (and only to the extent) the
Consignor has first received the fees payable pursuant to clause
(b) of Section 3.3.1 of the Fee Consignment Agreement, agrees to
pay over to each Supplier maintaining its Advances as Base Rate
Advances on the dates the Funding Fee is due and payable pursuant
to Section 3.2.1 a fee on such Advances at a rate equal to the
positive difference, if any, between (x) the Alternate Base Rate
from time to time in effect and (y) the LIBO Rate (Reserve
Adjusted) for the Funding Period in respect of such Advances plus
a margin of 1/2 of 1% per annum.
SECTION 4.4. Funding Losses. In the event any Supplier
shall incur any loss or expense (including any loss or expense
incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by such Supplier to make, continue or
maintain any Advance as a LIBO Rate Advance, or to convert any
portion of the principal amount of any Advance into, a LIBO Rate
Advance) as a result of
(a) any repayment or prepayment of the principal
amount of any LIBO Rate Advances or any conversion of a LIBO
Rate Advance on a date other than the scheduled last day of
the Funding Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Advances (i) not being made as, or (ii) being
made as Advances other than as, LIBO Rate Advances in
accordance with the Advance Request; or
(c) any Advances not being continued as, or converted
into, LIBO Rate Advances in accordance with the Continuation
Notice therefor,
then, following the written notice of such Supplier to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Consignor and the Consignee) of the amount that will (in the
reasonable determination of such Supplier) reimburse such
Supplier for such loss or expense, the Consignor agrees, subject
to the terms of this Agreement, that it will promptly, and in any
event within five days of its receipt of such amount or any
portion thereof from the Consignee pursuant to Section 9.3 of the
Fee Consignment Agreement, pay over to such Supplier the amount
so received. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of
manifest error, be prima facie evidence of the matters stated
therein.
SECTION 4.5. Increased Capital Costs. If any change in, or
the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority affects or would affect the amount of
capital required or expected to be maintained by any Supplier or
any Person controlling such Supplier, and such Supplier
determines (in its sole and absolute discretion) that the rate of
return on its or such controlling Person's capital as a
consequence of its Advance Commitment or the Advances made by
such Supplier is reduced to a level below that which such
Supplier or such controlling Person could have achieved but for
the occurrence of any such circumstance, then, in any such case
upon notice from time to time by such Supplier to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Consignor and the Consignee), the Consignor agrees, subject to
the terms of this Agreement, that it will promptly, and in any
event within five days of its receipt of a payment to compensate
such Supplier or such controlling Person for such reduction in
rate of return from the Consignee pursuant to Section 9.3 of the
Fee Consignment Agreement or, pay over to such Supplier the
amount actually received. A statement of such Supplier as to any
such additional amount or amounts (including calculations thereof
in reasonable detail) shall, in the absence of manifest error, be
prima facie evidence of the matters stated therein. In
determining such amount, such Supplier may use any method of
averaging and attribution that it (in its sole and absolute
discretion) shall deem applicable.
SECTION 4.6. Taxes. All payments made to the Suppliers and
the Administrative Agent hereunder shall be made free and clear
of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties,
withholdings or other charges of any nature whatsoever imposed by
any taxing authority, but excluding franchise taxes and taxes
imposed on or measured by any Supplier's net income or receipts
imposed by the jurisdiction of incorporation or organization of
such Supplier or the jurisdiction where such Supplier has its
Domestic Office or LIBOR Office (such non-excluded items being
called "Taxes"). In the event that any withholding or deduction
from any payment to be made hereunder is required in respect of
any Taxes pursuant to any applicable law, rule or regulation,
then, subject to the terms of this Agreement, the Consignor
agrees that it will pay over to the Administrative Agent for the
account of the Suppliers, such additional amount or amounts
actually received from the Consignee pursuant to Section 4.5 of
the Fee Consignment Agreement as is necessary to ensure that the
net amount actually received by each Supplier will equal the full
amount such Supplier would have received had no such withholding
or deduction been required. Moreover, if the Administrative
Agent or any Supplier is obligated to pay any Taxes with respect
to any payment received by the Administrative Agent or such
Supplier hereunder, the Administrative Agent or such Supplier may
pay such Taxes and, subject to the terms of this Agreement, the
Consignor agrees that it will pay over to the Administrative
Agent such additional amounts to the extent actually received
from the Consignee pursuant to Section 4.5 of the Fee Consignment
Agreement as is necessary in order that the net amount received
by such Person after the payment of such Taxes (including any
Taxes on such additional amount) shall equal the amount such
Person would have received had such Taxes not been asserted.
Upon the request of the Consignee, the Consignor or the
Administrative Agent, each Supplier that is organized under the
laws of a jurisdiction other than the United States or a State
thereof shall, prior to the due date of any payments hereunder,
execute and deliver to the Consignee, the Consignor and the
Administrative Agent, on or about the first scheduled payment
date in each Fiscal Year, one or more (as the Consignee, the
Consignor or the Administrative Agent may reasonably request)
United States Internal Revenue Service Forms 4224 or Forms 1001
or such other forms or documents (or successor forms or
documents), appropriately completed, as may be applicable to
establish the extent (if any) to which a payment to such Supplier
is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless otherwise
expressly provided, all payments pursuant to this Agreement or
any other Advance Document shall be made in Dollars subject to
the terms of this Agreement (including Section 8.15) to the
Administrative Agent for the pro rata account of the Suppliers
entitled to receive such payment in accordance with their
respective Percentages. All such payments required to be made to
the Administrative Agent shall, to the extent first received by
the Consignor, be made, without setoff, deduction or
counterclaim, not later than 11:00 a.m. (New York City time), on
the date due, in immediately available funds, to such account as
the Administrative Agent shall specify from time to time by
notice. Funds received after that time shall be deemed to have
been received by the Administrative Agent on the next succeeding
Business Day. The Administrative Agent shall promptly remit in
same day funds to each Supplier its share, if any, of such
payments received by the Administrative Agent for the account of
such Supplier. All interest and fees shall be computed on the
basis of the actual number of days (including the first day but
excluding the last day) occurring during the period for which
such interest or fee is payable over a year comprised of 360 days
(or, in the case of interest on a Base Rate Advance, 365 days or,
if appropriate, 366 days). Whenever any payment to be made shall
otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (b) of the
definition of the term "Funding Period") be made on the next
succeeding Business Day and such extension of time shall be
included in computing interest and fees, if any, in connection
with such payment.
SECTION 4.8. Sharing of Payments. If any Supplier, in such
capacity, shall obtain any payment or other recovery (whether
voluntary, involuntary, by application of setoff or otherwise) on
account of any Advance (other than pursuant to the terms of
Sections 4.3, 4.4, 4.5, 4.6 and 8.3) in excess of its pro rata
share of payments then or therewith obtained by all Suppliers,
such Supplier shall purchase from the other Suppliers such
participation in Advances made by them as shall be necessary to
cause such purchasing Supplier to share the excess payment or
other recovery ratably with each of them; provided, however, that
if all or any portion of the excess payment or other recovery is
thereafter recovered from such purchasing Supplier, the purchase
shall be rescinded and each Supplier which has sold a
participation to the purchasing Supplier shall repay to the
purchasing Supplier the purchase price to the ratable extent of
such recovery together with an amount equal to such selling
Supplier's ratable share (according to the proportion of
(a) the amount of such selling Supplier's required
repayment to the purchasing Supplier
to
(b) the total amount so recovered from the purchasing
Supplier)
of any interest or other amount paid or payable by the purchasing
Supplier in respect of the total amount so recovered.
SECTION 4.9. Use of Proceeds. The Consignor shall apply
the proceeds of the Advances in connection with the consignment
of Bullion by the Consignor to the Consignee under the Fee
Consignment Agreement. Without limiting the foregoing, the
Consignor agrees that on the date that each Advance (other than
pursuant to clause (a) of Section 2.3.1) is made, subject to
Article V of the Fee Consignment Agreement, it will effectuate or
cause to occur a consignment of Bullion to a Plant in the number
of ounces equal to the applicable Dollar Value of gold or Dollar
Value of silver requested pursuant to the corresponding
Consignment Request as required by the Fee Consignment Agreement
or, if such conditions are not satisfied, immediately repay each
such Advance made in respect thereof (together with interest on
the amount of such Advances at the rate customarily charged for
inter-bank loans in the U.S. for the number of days such Advances
were outstanding).
SECTION 4.10. Replacement of Suppliers. Each Supplier
hereby severally agrees that if such Supplier (a "Subject
Supplier") (a) makes a demand upon the Consignor for (or if the
Consignor or the Consignee is otherwise required to pay) amounts
as a result of the operation of Section 4.3, Section 4.5 or
Section 4.6, or (b) fails to fund any Advances it is required to
make (at a time when no Default has occurred and is continuing
and the applicable conditions set forth in Article V shall have
been satisfied) the Consignor may (and upon the instructions of
the Consignee shall),
(i) in the case of clause (a), within 90 days of
receipt by the Consignor of such demand (or the occurrence
of such other event causing the Consignor (subject to the
terms of this Agreement) or the Consignee to be required to
pay such compensation); and
(ii) within 10 Business Days following the failure of
such Subject Supplier to fund its Advance hereunder,
in each case give notice (a "Replacement Notice") in writing to
the Administrative Agent and such Supplier of its intention to
replace such Supplier with a financial institution selected by
the Consignor and the Consignee and designated in such
Replacement Notice. If the Administrative Agent shall, in the
exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice, notify the Consignee, the
Consignor and such Subject Supplier in writing that the
designated financial institution is satisfactory to the
Administrative Agent, then such Supplier shall, so long as no
Default shall have occurred and be continuing, assign, in
accordance with Section 8.11.1 (including the second proviso in
Section 8.11.1), inter alia all of its Advance Commitment,
Advances, and other rights and obligations under this Agreement
and all other Advance Documents to such designated financial
institution; provided, however, that (i) such assignment shall be
without recourse, representation or warranty and shall be on
terms and conditions reasonably satisfactory to such Supplier and
such designated financial institution and (ii) the purchase price
paid by such designated financial institution shall be in the
amount of such Supplier's Advances, together with all accrued and
unpaid interest and fees in respect thereof, plus all other
amounts (including the amounts demanded and unreimbursed under
Section 4.3, 4.5 or 4.6, as the case may be), owing to the
Subject Supplier hereunder. Upon the effective date of such
Assignment, such institution shall become a "Supplier" for all
purposes under this Agreement and the other Advance Documents.
The Administrative Agent agrees to use all commercially
reasonable efforts to assist in locating a replacement financial
institution to replace any Subject Supplier if the Consignee
shall have agreed in writing to pay all reasonable costs and
expenses (including the fee payable to the Administrative Agent
pursuant to Section 8.11.1) incurred by the Administrative Agent
in providing such assistance.
SECTION 4.11. Assignment to Administrative Agent. For good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Consignor hereby sells, transfers,
assigns and conveys to the Administrative Agent, for its benefit
and the benefit of the Suppliers (as defined in this Agreement
and the Short-Term Dollar Supply Agreement), without
representation, warranty or recourse of any kind or nature, its
rights, title and interest in and to
(a) all Obligations (under and as defined in the Fee
Consignment Agreement and the Short-Term Fee Consignment
Agreement) of the Consignee owing to the Consignor under the
Fee Consignment Agreement and the Short-Term Fee Consignment
Agreement, to the extent such performance and/or payment
Obligations relate to the contingent obligation of the
Consignor to pay over to the Administrative Agent, for the
benefit of the Suppliers, any amounts hereunder or under the
Short-Term Dollar Supply Agreement that are conditioned upon
the Consignor first receiving a like amount (or any amount,
in the case of a sale of Bullion to the Consignee) from the
Consignee, or are conditioned upon the Consignee returning
Bullion back to the Consignor pursuant to the terms of the
Fee Consignment Agreement and the Short-Term Fee Consignment
Agreement; and
(b) the security interest granted to the Consignor by
the Consignee pursuant to the terms of Section 4.2 of the
Fee Consignment Agreement and Section 4.2 of the Short-Term
Fee Consignment Agreement in the Collateral to secure the
performance and payment of all such Obligations (including
in connection with a Bullion Sale) of the Consignee
described above in clause (a).
In furtherance of the foregoing, the Consignor agrees to execute
such additional documents and perform such further acts as may be
reasonably requested by the Required Suppliers to carry out and
perform the foregoing provisions, including the filing of
financing statements (Form UCC-3) reflecting the assignment
effectuated by this Section, and agrees to comply with the
provisions of this Agreement, including the provisions of Section
6.2 and Section 6.3. The Suppliers acknowledge the intent of the
Consignor and the Consignee, as set forth in the Fee Consignment
Agreement, is that the Fee Consignment Agreement and the
transactions contemplated thereunder are a true consignment, and
not a consignment intended as security.
ARTICLE V
CONDITIONS TO ADVANCES
SECTION 5.1. Initial Advance. The obligations of the
Suppliers to fund the initial Advance on and after the Effective
Date shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Administrative Agent
shall have received from the Consignee a certificate, dated the
date of the initial Advance, of its Secretary or Assistant
Secretary as to
(a) resolutions of its Board of Directors then in full
force and effect authorizing the acknowledgment of this
Agreement;
(b) true and complete copies of the Consignee's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement,
upon which certificate each Supplier may conclusively rely until
it shall have received a further certificate of the Secretary or
Assistant Secretary of the Consignee canceling or amending such
prior certificate.
SECTION 5.1.2. Revolving Credit Agreement and Fee
Consignment Agreement Effectiveness. All of the conditions set
forth in Section 5.1 of the Revolving Credit Agreement and
Section 5.1 of the Fee Consignment Agreement shall have been
satisfied (unless otherwise consented to by the Suppliers)
without waiver or modification and each of the Revolving Credit
Agreement and the Fee Consignment Agreement shall have become
effective in accordance with their terms.
SECTION 5.1.3. Opinions of Counsel. The Administrative
Agent shall have received
(a) copies of the opinions described in Section 5.1.4
of the Fee Consignment Agreement, together with reliance
letters, dated the date of the initial Advance and (in the
case of other than the opinion described in clause (e) of
Section 5.1.4 of the Fee Consignment Agreement) addressed to
the Administrative Agent, the Co-Agents and all Suppliers
(pursuant to which the Consignee (or, in the case of the
opinion to be delivered by Bingham, Dana & Gould, the
Consignor) shall have expressly instructed the counsel to
deliver such opinions to the Administrative Agent and the
Suppliers);
(b) an opinion of Kenneth E. Thorlakson, General
Counsel to the Consignor, substantially in the form of
Exhibit F hereto (and the Consignor hereby expressly
instructs such counsel to deliver such opinion to the
Suppliers); and
(c) an opinion of Mayer, Brown & Platt, New York,
counsel to the Consignor, substantially in the form of
Exhibit G hereto (and the Consignor hereby expressly
instructs such counsel to deliver such opinion to the
Suppliers).
SECTION 5.1.4. Closing Fees, Expenses, etc. The
Administrative Agent shall have received all fees, costs and
expenses due and payable pursuant to Section 8.3, if then
invoiced.
SECTION 5.2. All Advances. The obligation of each Supplier
to fund any Advance (including the initial Advance), other than
an Advance required to be made pursuant to clause (a) of Section
2.3.1 shall be subject to the satisfaction of each of the
conditions precedent set forth in this Section 5.2.
SECTION 5.2.1. No Default, etc. Both before and after
giving effect to any such Advance the following statements shall
be true and correct
(a) after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(i) to all Suppliers shall not exceed the Advance
Commitment Amount; or
(ii) to such Supplier shall not exceed such
Supplier's Percentage multiplied by the Advance
Commitment Amount;
(b) the conditions to the consignment of Bullion set
forth in Article V of the Fee Consignment Agreement (other
than as set forth in clause (f) of Section 5.2.1 thereof)
shall have been satisfied; and
(c) no Default shall have then occurred and be
continuing.
SECTION 5.2.2. Advance Request. The Administrative Agent
shall have received an Advance Request from the Consignor for
such Advance.
SECTION 5.2.3. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto in connection with such
Advance (other than Advance Requests and Continuation Notices)
shall be reasonably satisfactory in form and substance to the
Required Suppliers and, to the extent reasonably requested by the
Required Suppliers, the Suppliers shall have received all
information, approvals, opinions, documents or instruments as the
Required Suppliers may reasonably request; provided, that neither
the Administrative Agent nor the Consignor shall be under any
obligation to ascertain if any such information, approvals,
opinions, documents or instruments are required by any Supplier
prior to any Advance.
SECTION 5.2.4. No Consignor Bankruptcy Event. No Consignor
Bankruptcy Event shall have occurred.
SECTION 5.2.5. Advances Pursuant to Section 2.3.1. The
obligation of each Supplier to continue to fund any Advance
pursuant to clause (a) of Section 2.3.1 shall be subject to the
satisfaction of each of the following conditions precedent:
(a) after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(i)to all Suppliers shall not exceed the Advance
Commitment Amount; or
(ii)to such Supplier shall not exceed such
Supplier's Percentage multiplied by the Advance
Commitment Amount;
(b) the Administrative Agent shall have received a
Continuation Notice from the Consignor for such Advance;
(c) no Consignor Bankruptcy Event shall have occurred;
and
(d) the conditions set forth in Section 5.2.3 (other
than in clause (d) thereof) of the Fee Consignment Agreement
shall have been satisfied.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 6.1
shall constitute an "Event of Default".
SECTION 6.1.1. Breach of Warranty. Any representation or
warranty of the Consignee made or deemed to be made in any Fee
Consignment Document or any other writing or certificate
furnished by or on behalf of the Consignee to the Consignor for
the purposes of or in connection with any such Fee Consignment
Document (including any certificates delivered pursuant to
Article V of the Fee Consignment Agreement) is or shall be
incorrect when made in any material respect.
SECTION 6.1.2. Default Under Material Agreements, etc. An
"Event of Default" under (and as defined in) the Fee Consignment
Agreement, the Short-Term Dollar Supply Agreement, the Short-Term
Fee Consignment Agreement, the Short Term Revolving Credit
Agreement or the Revolving Credit Agreement shall have occurred
and be continuing.
SECTION 6.1.3. Bankruptcy, Insolvency, etc. The Consignee
or any of its Subsidiaries (including joint ventures) shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignee or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignee or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall not
be discharged within 60 days;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignee or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Consignee or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in by
the Consignee or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Consignee, the value of whose assets in
the aggregate for the Fiscal Quarter (as defined in the Revolving
Credit Agreement) most recently ended accounted for an amount
equal to or less than 5% of Adjusted Consolidated Tangible Net
Worth (as defined in the Revolving Credit Agreement).
SECTION 6.2. Action if Bankruptcy. If any Event of Default
described in clauses (a) through (d) of Section 6.1.3 shall
occur, the Advance Commitment of each Supplier (if not
theretofore terminated) shall automatically terminate and the
Stated Maturity Date shall automatically be accelerated and, as
set forth in Section 8.2 of the Fee Consignment Agreement, the
outstanding amount of all Obligations under each Fee Consignment
Document shall automatically be and become immediately due and
payable, and the Consignor agrees that it shall require that all
previously delivered Bullion then held by the Consignee pursuant
to the terms of the Fee Consignment Agreement shall be
immediately returned to the Consignor, in each case without
notice or demand.
SECTION 6.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 6.1.3) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required
Suppliers, shall by notice to the Consignor and the Consignee
declare the Advance Commitment of each Supplier (if not
theretofore terminated) to be terminated and/or the Stated
Maturity Date to be accelerated and/or direct the Consignor to
(i) declare all or any portion of the Obligations of the
Consignee under each Fee Consignment Document to be due and
payable, and/or (ii) require that all or any portion of
previously consigned Bullion then held by the Consignee pursuant
to the terms of the Fee Consignment Agreement be immediately
returned to the Consignor, whereupon the full unpaid amount of
such Obligations of the Consignee which shall be so declared due
and payable shall be and become immediately due and payable,
without further notice, demand or presentment, the Advance
Commitments shall terminate and the Stated Maturity Date shall be
accelerated, and all such previously delivered Bullion shall be
immediately returned to the Consignor, in each case as so
directed by the Required Suppliers. Upon receipt of the notice
described in the first sentence of this Section, the Consignor
hereby agrees that it shall deliver a notice to the Consignee
that all Bullion then held by the Consignee pursuant to the Fee
Consignment Agreement is to be immediately returned to the
Consignor and that all monetary Obligations of the Consignee
under the Fee Consignment Agreement are then due and payable, in
accordance with Section 8.3 of the Fee Consignment Agreement. In
addition, the Consignor agrees that, if directed by the Required
Suppliers, it will deliver a notice to the Consignee of a default
by the Consignee of its Obligations under the Fee Consignment
Agreement, as contemplated by Section 8.1.4 of the Fee
Consignment Agreement.
SECTION 6.4. Consignor Bankruptcy Event. If any Consignor
Bankruptcy Event shall occur, the Advance Commitment of each
Supplier (if not therefore terminated) shall automatically
terminate and the Stated Maturity Date shall automatically be
accelerated, without notice or demand.
ARTICLE VII
THE AGENTS
SECTION 7.1. Actions. Each Supplier hereby appoints each
of Scotiabank, Chemical and BONY as its Co-Agent, and Scotiabank
as its Administrative Agent, under and for purposes of this
Agreement and each other Advance Document. Each Supplier
authorizes Scotiabank, in its capacity as the Administrative
Agent, to act on behalf of such Supplier under this Agreement and
each other Advance Document in such capacity and, in the absence
of other written instructions from the Required Suppliers
received from time to time by the Administrative Agent (with
respect to which the Administrative Agent agrees that it will
comply, except as otherwise provided in this Section or as
otherwise advised by counsel), to exercise such powers hereunder
and thereunder as are specifically delegated to or required of
the Administrative Agent by the terms hereof and thereof,
together with such powers as may be reasonably incidental
thereto. Each Supplier hereby indemnifies (which indemnity shall
survive any termination of this Agreement) the Administrative
Agent, pro rata according to such Supplier's Percentage, from and
against any and all liabilities, obligations, losses, damages,
claims, costs or expenses of any kind or nature whatsoever to the
extent not otherwise paid by the Consignee which may at any time
be imposed on, incurred by, or asserted against, the
Administrative Agent in any way relating to or arising out of
this Agreement and any other Advance Document, including
reasonable attorneys' fees, and as to which the Administrative
Agent is required to be, but is not reimbursed by the Consignee
or, to the extent received from the Consignee, the Consignor;
provided, however, that no Supplier shall be liable for the
payment of any portion of such liabilities, obligations, losses,
damages, claims, costs or expenses which are determined to have
resulted solely from the Administrative Agent's gross negligence
or wilful misconduct. The Administrative Agent shall not be
required to take any action hereunder or under any other Advance
Document except for such actions expressly provided for
hereunder, or to prosecute or defend any suit in respect of this
Agreement or any other Advance Document (including under Section
4.11) unless it is indemnified hereunder to its satisfaction. If
any indemnity in favor of the Administrative Agent shall be or
become, in the Administrative Agent's determination, inadequate,
the Administrative Agent may call for additional indemnification
from the Suppliers and cease to do the acts indemnified against
hereunder until such additional indemnity is given.
SECTION 7.2. Funding Reliance, etc. Unless the
Administrative Agent shall have been notified by telephone,
confirmed in writing, by any Supplier by 5:00 p.m. (New York City
time), on the day prior to an Advance that such Supplier will not
make available the amount which would constitute its Percentage
of such Advance on the date specified therefor, the
Administrative Agent may assume that such Supplier has made such
amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the Consignor a
corresponding amount. If and to the extent that such Supplier
shall not have made such amount available to the Administrative
Agent, such Supplier agrees to immediately advance to the
Administrative Agent on demand the corresponding amount together
with interest thereon, for each day from the date the
Administrative Agent made such amount available to the Consignor
to the date such amount is repaid to the Administrative Agent (i)
for the period from the date such funds were advanced to the
Consignor to (and including) three days thereafter, at the rate
customarily charged for inter-bank loans in the U.S. (and the
amount of interest that shall be returned to such Supplier in
respect of such days shall also equal the rate customarily
charged for inter-bank loans in the U.S.), and (ii) following
such third day, at the interest rate applicable at the time to
Advances comprising such Advance.
SECTION 7.3. Exculpation. Neither the Administrative
Agent, the Consignor (with respect to liabilities of the
Consignor arising under other than clause (e) of Section 3.1.3)
or any Co-Agent, nor any of their respective directors, officers,
employees or agents shall be liable to any Supplier for any
action taken or omitted to be taken by it under this Agreement or
any other Advance Document, or in connection herewith or
therewith, except for its own wilful misconduct or gross
negligence, nor responsible for any recitals or warranties herein
or therein, nor for the effectiveness, or, other than with
respect to such Administrative Agent, Consignor or Co-Agent
enforceability, validity or due execution of this Agreement or
any other Advance Document (as it relates to such Person), nor to
make any inquiry respecting the performance by the Consignee of
its obligations hereunder or under any other Advance Document.
Any such inquiry which may be made by the Administrative Agent
shall not obligate it to make any further inquiry or to take any
action. The Administrative Agent and the Consignor shall be
entitled to rely upon advice of counsel concerning legal matters
and upon any notice, consent, certificate, statement or writing
which the Administrative Agent or the Consignor believes to be
genuine and to have been presented by a proper Person.
SECTION 7.4. Successor. The Administrative Agent may, with
the consent of all the Suppliers, resign as such at any time upon
at least 30 days' prior notice to the Consignor, the Consignee
and all Suppliers. If the Administrative Agent at any time shall
resign, the Required Suppliers may, with the written consent of
the Consignee so long as no Default has occurred and is
continuing (which consent shall not be unreasonably withheld),
appoint another Supplier as a successor Administrative Agent,
which shall thereupon (subject to its consent) become the
Administrative Agent hereunder. If no successor Administrative
Agent shall have been so appointed by the Required Suppliers, and
shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the
Suppliers, appoint a successor Administrative Agent, which shall
(subject to its consent) be one of the Suppliers or a commercial
banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking
institution, and having a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to
receive from the retiring Administrative Agent such documents of
transfer and assignment as such successor Administrative Agent
may reasonably request, and shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's
resignation hereunder as the Administrative Agent, the provisions
of
(a) this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was
the Administrative Agent under this Agreement; and
(b) Section 8.3 and Section 8.4 shall continue to
inure to its benefit.
SECTION 7.5. Advances by an Agent. Each Agent shall have
the same rights and powers with respect to the Advances made by
it or any of its respective Affiliates as any other Supplier and
may exercise the same as if it were not an Agent. Each Agent and
its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with the Consignee or
any Subsidiary or Affiliate of the Consignee as if such Agent, as
the case may be, were not an Agent hereunder.
SECTION 7.6. Credit Decisions. Each Supplier acknowledges
that it has, independently of the Consignor, the Administrative
Agent, each Co-Agent and each other Supplier, and based on such
Supplier's review of the financial information of the Consignee,
this Agreement, the other Advance Documents (the terms and
provisions of which being satisfactory to such Supplier) and such
other documents, information and investigations as such Supplier
has deemed appropriate, made its own credit decision to extend
its Advance Commitment. Each Supplier also acknowledges that it
will, independently of the Consignor, the Administrative Agent,
each Co-Agent and each other Supplier, and based on such other
documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time
any rights and privileges available to it under this Agreement or
any other Advance Document.
SECTION 7.7. Copies, etc. The Administrative Agent shall
give prompt notice to each Supplier of each notice or request
required or permitted to be given to the Administrative Agent by
the Consignor and the Consignee pursuant to the terms of this
Agreement (unless concurrently delivered to the Suppliers by the
Consignor or the Consignee). The Administrative Agent will
distribute to each Supplier each document or instrument received
for its account and copies of all other communications received
by the Administrative Agent from the Consignor and the Consignee
for distribution to the Suppliers by the Administrative Agent in
accordance with the terms of this Agreement.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Advance Document may from time
to time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to by the
Required Suppliers and the Consignee, provided, however, that no
such amendment, modification or waiver to this Agreement; and,
the Consignor shall not consent to any amendment, modification or
waiver to any Fee Consignment Document, which would:
(a) modify any requirement hereunder that any
particular action be taken by all the Suppliers or by the
Required Suppliers shall be effective unless consented to by
each Supplier;
(b) modify this Section 8.1 or Section 4.2 (or any
defined terms contained therein), the last sentence of
Section 9.10, Sections 9.3, 9.4 or 9.13 of the Fee
Consignment Agreement, change the definition of "Required
Suppliers", increase the Advance Commitment Amount or the
Percentage of any Supplier, release any collateral security
(it being acknowledged and agreed by the parties hereto that
the use of Bullion by the Consignee in the production and
fabrication of products for its customers or the sale
thereof to its customers (to the extent such Bullion has
been purchased pursuant to the terms of the Fee Consignment
Agreement or other gold and/or silver (as applicable) has
been returned to the Consignor pursuant to the terms of the
Fee Consignment Agreement) shall not be deemed to be a
release of collateral security), or (except as set forth in
Section 2.4.2) extend the Advance Commitment Termination
Date shall be made without the consent of each Supplier (and
the Consignor agrees that it will not consent to any such
amendment, waiver or other modification to the Fee
Consignment Agreement unless each Supplier (or in the case
of Section 9.3 of the Fee Consignment Agreement, each
affected Supplier) has first so consented);
(c) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of
principal of or fee in respect of any Advance or any other
amounts to a Supplier hereunder (or reduce the principal
amount of or rate of any fee or interest on any Advance)
shall be made without the consent of each affected Supplier;
(d) affect adversely the interests, rights or
obligations of (i) an Agent qua such Agent or (ii) the
Consignor, shall be made without consent of such Agent or
the Consignor, as applicable;
(e) amend, waive or otherwise modify (i) the
definition of "Bullion", "gold" or "silver", Sections 2.3,
2.3.3, 7.2.2 or 9.1 of the Fee Consignment Agreement, (ii)
any representation or warranty made by the Consignee in
Article VI of the Fee Consignment Agreement (including those
incorporated by reference in Section 6.1 thereof), any
covenant made by the Consignee in Article VII of the Fee
Consignment Agreement (including those incorporated by
reference in Section 7.1 thereof) or any Event of Default
(under and as defined in the Fee Consignment Agreement), or
(iii) any condition to the consignment of Bullion contained
in Article V of the Fee Consignment Agreement, shall be
consented to by the Consignor unless first consented to by
the Required Suppliers (and the Consignor agrees that it
will not consent to any such amendment, waiver or other
modification to the Fee Consignment Agreement unless the
Required Suppliers have first so consented); or
(f) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of (or
reduce the rate of) any fee, interest or other amounts
payable under the Fee Consignment Agreement shall be made
without the consent of each affected Supplier (and the
Consignor agrees that it will not consent to any such
extensions or reductions unless each affected Supplier has
first so consented).
No failure or delay on the part of any Agent, any Supplier or the
Consignor in exercising any power or right under this Agreement
or any other Advance Document shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power or
right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on
the Consignor or the Consignee in any case shall entitle it to
any notice or demand in similar or other circumstances. No
waiver or approval by any Agent, any Supplier or the Consignor
under this Agreement or any other Advance Document shall, except
as may be otherwise stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
SECTION 8.2. Notices. All notices and other communications
provided to any party hereto or the Consignee under this
Agreement or any other Advance Document shall be in writing or by
facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth below its signature
hereto (or, in the case of the Consignee, at its address or
facsimile number set forth in the Fee Consignment Agreement) or
set forth in the Supplier Assignment Agreement or at such other
address or facsimile number as may be designated by such party or
the Consignee, as applicable, in a notice to the other parties.
Any notice, if mailed and properly addressed with postage prepaid
or if properly addressed and sent by pre-paid courier service,
shall be deemed given when received; any notice, if transmitted
by facsimile, shall be deemed given when transmitted upon receipt
of electronic confirmation of transmission.
SECTION 8.3. Payment of Costs and Expenses. Subject to the
terms of this Agreement, the Consignor agrees to pay over to the
Administrative Agent all reasonable out-of-pocket expenses of the
Administrative Agent (including the fees and out-of-pocket
expenses of a single counsel to the Administrative Agent and of
local counsel, if any, who may be retained by counsel to the
Administrative Agent) received by it from the Consignee pursuant
to Section 9.3 of the Fee Consignment Agreement in connection
with
(a) the negotiation, preparation, execution and
delivery and (where applicable), filing and recording of
this Agreement and of each other Advance Document, including
schedules and exhibits, and any amendments, waivers,
consents, supplements or other modifications to this
Agreement or any other Advance Document as may from time to
time hereafter be required, whether or not the transactions
contemplated hereby are consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Advance Document; and
(c) the administration and monitoring of this
Agreement and the Advance Documents, and compliance of the
parties hereto with respect to the terms hereof.
Subject to the terms of this Agreement, the Consignor further
agrees to pay over to the Administrative Agent amounts actually
received from the Consignee pursuant to Section 9.3 of the Fee
Consignment Agreement in respect of any stamp or other taxes
which may be payable in connection with the execution or delivery
of this Agreement, the Advances hereunder or any other Advance
Documents (provided, that each Supplier agrees if any Taxes are
paid by the Consignor or the Administrative Agent on behalf of
any Supplier to any governmental authority and such Taxes are not
paid over by the Consignee to the Consignor or the Administrative
Agent, as the case may be, as required pursuant to Section 4.5 of
the Fee Consignment Agreement, then such Supplier shall, promptly
following demand by the Consignor or the Administrative Agent, as
applicable, pay to the Consignor or Administrative Agent the full
amount of such Taxes). Subject to the terms of this Agreement,
the Consignor also agrees to pay over to the Administrative Agent
(to the extent (and only to the extent) first received by the
Consignor from the Consignee) for the account of the relevant
Supplier amounts in respect of reasonable out-of-pocket expenses
(including attorneys' fees and legal expenses (including those
fees and legal expenses of internal counsel to such Supplier
allocated to this Agreement)) incurred by such Agent, or such
Supplier in connection with (x) the negotiation of any
restructuring or "work-out", whether or not consummated, of any
Obligations and (y) the enforcement of any Obligations.
SECTION 8.4. Turn-Over of Certain Payments. Subject to the
terms of this Agreement, the Consignor hereby agrees to pay over
to the Administrative Agent, to the extent (and only to the
extent) first received by the Consignor from the Consignee under
Sections 9.3 and 9.14 of the Fee Consignment Agreement, costs and
expenses arising in connection with any and all actions, causes
of action, suits, losses (other than the principal amount of the
Advances), costs, liabilities and damages, and expenses incurred
by the Agents or the Suppliers and each of their respective
officers, directors, employees and agents (collectively, the
"Indemnified Parties") in connection with the execution and
delivery of this Agreement by the Agents and each Supplier and
the extension of the Advance Commitment (irrespective of whether
any such Indemnified Party is a party to such action), including
reasonable attorneys' fees and disbursements (collectively, the
"Indemnified Liabilities"), incurred by the Indemnified Parties
or any of them as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds
of any Advance;
(b) any breach by the Consignee of its Obligations
under (and as defined in) the Fee Consignment Agreement;
(c) any investigation, litigation or proceeding
involving the Consignee or any of its Subsidiaries or
property now or previously owned or leased by the Consignee
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Consignee or any of its
Subsidiaries or the Release by the Consignee or any of its
Subsidiaries of any Hazardous Material; provided; that the
Indemnified Party shall have given the Consignee notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(d) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Consignee or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Consignee or such
Subsidiary; or
(e) any breach of warranty contained in Section 6.12
of the Revolving Credit Agreement (as incorporated by
reference pursuant to Section 6.1 of the Fee Consignment
Agreement), without giving effect to the exceptions based
upon the materially adverse effect and any qualification
based on materiality or knowledge;
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of the
relevant Indemnified Party's gross negligence or wilful
misconduct.
SECTION 8.5. Survival. Subject to the terms of this
Agreement, the obligations of the Consignor under Article IV,
Section 8.3 and Section 8.4, the obligations of the Suppliers
under Section 7.1, and the provisions of Section 8.15 (including
the obligations of the parties hereto pursuant to such Section)
shall, in each case survive any termination of this Agreement,
the payment in full of all Obligations and the termination of the
Advance Commitment.
SECTION 8.6. Severability. Any provision of this Agreement
or any other Advance Document which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Advance Document
or affecting the validity or enforceability of such provision in
any other jurisdiction.
SECTION 8.7. Headings. The various headings of this
Agreement and of each other Advance Document are inserted for
convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Advance Document
or any provisions hereof or thereof.
SECTION 8.8. Execution in Counterparts, Effectiveness, etc.
This Agreement may be executed by the parties hereto in several
counterparts, each of which shall be executed by the Consignor
and the Administrative Agent and be deemed to be an original and
all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Consignor, each
Agent and each Supplier, and acknowledged by the Consignee (or
notice thereof satisfactory to the Administrative Agent) shall
have been received by the Administrative Agent and notice thereof
shall have been given by the Administrative Agent to the
Consignee and each Supplier.
SECTION 8.9. Governing Law; Entire Agreement. THIS
AGREEMENT AND EACH OTHER ADVANCE DOCUMENT SHALL EACH BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK. This Agreement and the other Advance
Documents constitute the entire understanding among the parties
hereto with respect to the subject matter hereof and supersede
any prior agreements, written or oral, with respect thereto.
SECTION 8.10. Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns; provided,
however, that:
(a) the Consignor (i) may not assign or transfer its
rights or obligations hereunder or (except as set forth in
Section 4.11) under the Fee Consignment Agreement and (ii)
agrees that it will not consent to the Consignee assigning
or transferring any of its rights or obligations under the
Fee Consignment Agreement, in each case without the prior
written consent of all Suppliers; and
(b) the rights of sale, assignment and transfer of the
Suppliers are subject to Section 8.11;
provided, that, the parties hereto acknowledge and agree that the
Consignee is a third party beneficiary of clauses (b) and (c) of
Section 2.4.2, Sections 4.1 through 4.6 (inclusive), 4.10, 7.4,
8.1, 8.2 and 8.11, to the extent such clauses and Sections
expressly provide the Consignee with rights or benefits
thereunder, and, to the extent of the delivery requirements of
the Consignor thereunder, Sections 2.3, 2.3.1 and 3.2.1.
SECTION 8.11. Sale and Transfer of Advances; Participation
in Advances. Each Supplier may assign, or sell participation in,
its Advances and Advance Commitment to one or more other Persons
in accordance with this Section 8.11.
SECTION 8.11.1. Assignments. Any Supplier,
(a) with the written consent of the Consignor
(provided, that the Consignee shall have also consented to
such Assignee Lender pursuant to Section 10.11.1 of the
Revolving Credit Agreement, which consents shall not be
unreasonably delayed or withheld and which consent, in the
case of the Consignee, shall be deemed to have been given in
the absence of a written notice delivered by the Consignee
to the Administrative Agent, on or before the fifth Business
Day after receipt by the Consignee of such Supplier's
request for consent, stating, in reasonable detail, the
reasons why the Consignee proposes to withhold such consent)
may at any time assign and delegate to one or more
commercial banks or other financial institutions;
(b) with notice to the Consignee and the
Administrative Agent, but without the consent of any Person,
may (i) assign and delegate to any other Supplier, and (ii)
assign and/or delegate to any of its Affiliates or
Subsidiaries; and
(c) with notice to the Administrative Agent, but
without the consent of any Person, may pledge its Advances
(and related rights thereto) to a Federal Reserve Bank in
support of borrowings made by such Supplier from such
Federal Reserve Bank;
(each Person described in the foregoing clauses as being the
Person to whom such assignment and delegation is to be made,
being hereinafter referred to as an "Assignee Supplier"), all or
any fraction of such Supplier's total Advances and Advance
Commitment (which assignment and delegation shall be of a
constant, and not a varying, percentage of all the assigning
Supplier's Advances and Advance Commitment) in a minimum
aggregate amount, when taken together with other assignments
being made to such Assignee Supplier under the Revolving Credit
Agreement, the Short Term Revolving Credit Agreement and the
Short-Term Dollar Supply Agreement, of $10,000,000 in the case of
an assignment described in clause (a) (such amount to be reduced
pro rata by any permanent reductions in the amount of the Advance
Commitment), or if less, all of such Supplier's Advances and
Advance Commitment; provided, however, that any such Supplier
will (i) except in connection with a pledge of Advances pursuant
to clause(c) above, contemporaneously sell a pro rata portion of
its (A) Advances and Advance Commitment (as such terms are
defined in the Short-Term Dollar Supply Agreement), (B) Loans and
Commitment (as such terms are defined in the Revolving Credit
Agreement) and (C) its Loans and Commitment (as such terms are
defined in the Short Term Revolving Credit Agreement), in each
case to the same Assignee Supplier pursuant to the terms of such
agreements, and (ii) comply, if applicable, with the provisions
contained in the last sentence of Section 4.6 and further,
provided, however, that, the Consignee, the Consignor and the
Administrative Agent shall be entitled to continue to deal solely
and directly with such Supplier in connection with the interests
so assigned and delegated to an Assignee Supplier until
(d) written notice of such assignment and delegation,
together with payment instructions, addresses and related
information with respect to such Assignee Supplier, shall
have been given to the Consignee and the Administrative
Agent by such Supplier and such Assignee Supplier;
(e) such Assignee Supplier shall have executed and
delivered to the Consignee and the Administrative Agent a
Supplier Assignment Agreement, accepted by the
Administrative Agent and acknowledged by the Consignee; and
(f) the processing fees described below shall have
been paid.
From and after the date that the Administrative Agent accepts
such Supplier Assignment Agreement, (x) the Assignee Supplier
thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder
have been assigned and delegated to such Assignee Supplier in
connection with such Supplier Assignment Agreement, shall have
the rights and obligations of a Supplier hereunder and under the
other Advance Documents, and (y) the assignor Supplier, to the
extent that rights and obligations hereunder have been assigned
and delegated by it in connection with such Supplier Assignment
Agreement, shall be released from its obligations hereunder and
under the other Advance Documents. Accrued interest and fees on
that part of the assigned Advances and Advance Commitment shall
be paid as provided in the Supplier Assignment Agreement.
Subject to the terms hereof, accrued interest and accrued fees
shall be paid by the Consignor at the same time or times provided
in this Agreement. Such assignor Supplier or such Assignee
Supplier must also pay (without duplication of any processing
fees payable pursuant to Section 10.11.1 of the Revolving Credit
Agreement, Section 10.11.1 of the Short Term Revolving Credit
Agreement and Section 8.11.1 of the Short-Term Dollar Supply
Agreement) a processing fee to the Administrative Agent upon
delivery of any Supplier Assignment Agreement in the amount of
$2,500 (provided, however, that such processing fee shall not be
required to be paid by a Supplier in the case of (i) an
assignment and/or delegation of such Supplier's Advances and
Advance Commitment to an Affiliate or Subsidiary of such
Supplier, or (ii) to a Federal Reserve Bank pursuant to clause
(c) of this Section). Any attempted assignment and delegation
not made in accordance with this Section 8.11.1 shall be null and
void.
SECTION 8.11.2. Participation. Any Supplier may at any
time sell to one or more commercial banks or other Persons (each
of such commercial banks and other Persons being herein called a
"Participant") participating interests in any of the Advances,
its Advance Commitment, or other interests of such Supplier
hereunder; provided, however, that
(a) no participation contemplated in this
Section 8.11.2 shall relieve such Supplier from its Advance
Commitment or its other obligations hereunder or under any
other Advance Document;
(b) such Supplier shall remain solely responsible for
the performance of its Advance Commitment and such other
obligations;
(c) the Consignee, the Consignor and the
Administrative Agent shall continue to deal solely and
directly with such Supplier in connection with such
Supplier's rights and obligations under this Agreement and
each of the other Advance Documents;
(d) no Participant, unless such Participant is an
Affiliate of such Supplier, or is itself a Supplier, shall
be entitled to require such Supplier to take or refrain from
taking any action hereunder or under any other Advance
Document, except that such Supplier may agree with any
Participant that such Supplier will not, without such
Participant's consent, take any actions of the type
described in clause (b), (c) or (f) of Section 8.1; and
(e) neither the Consignor nor the Consignee shall be
required to pay any amount hereunder or under the Fee
Consignment Agreement that is greater than the amount which
it would have been required to pay had no participating
interest been sold.
Subject to the terms of this Agreement, the Consignor
acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 8.3 and 8.4, shall be
considered a Supplier.
SECTION 8.12. Other Transactions. Nothing contained herein
shall preclude any Agent or any other Supplier from engaging in
any transaction, in addition to those contemplated by this
Agreement or any other Advance Document, with the Consignee or
any of its Affiliates in which the Consignee or such Affiliate is
not restricted hereby from engaging with any other Person.
SECTION 8.13. Forum Selection and Consent to Jurisdiction.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER ADVANCE DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
ORAL OR WRITTEN) OR ACTIONS OF EACH AGENT, THE CONSIGNOR OR THE
SUPPLIERS SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE CITY AND STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL
OR OTHER PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT'S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL
OR OTHER PROPERTY MAY BE FOUND. THE SUPPLIERS, THE AGENTS AND
THE CONSIGNOR HEREBY EXPRESSLY AND IRREVOCABLY FOR ITSELF AND ITS
PROPERTY SUBMIT TO THE JURISDICTION OF THE COURTS OF THE CITY AND
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION.
SECTION 8.14. Waiver of Jury Trial. EACH AGENT, THE
CONSIGNOR AND THE SUPPLIERS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER ADVANCE
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH AGENT, THE CONSIGNOR
OR THE SUPPLIERS. THE AGENTS, THE SUPPLIERS AND THE CONSIGNOR
ACKNOWLEDGE AND AGREE THAT EACH HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER ADVANCE DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR EACH OTHER PARTY HERETO
ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER ADVANCE
DOCUMENT.
SECTION 8.15. No Recourse. Each of the parties acknowledge
and agree that the Consignor shall in no event be (or be deemed
to be) a guarantor, surety or obligor of any of the monetary or
other Obligations (when used in this Section, such term to mean
and include the Obligations under (and as defined in) the Fee
Consignment Agreement and the Short-Term Fee Consignment
Agreement) of the Consignee, and shall under no circumstances be
liable for any of the Obligations of the Consignee. In
furtherance of the foregoing, and notwithstanding any provisions
herein or in any of the other Advance Documents or Fee
Consignment Documents to the contrary (other than the last
sentence of this Section),
(a) in the event that the Administrative Agent, acting
at the direction of the Required Suppliers, shall at any
time take action to enforce the collection of the
Obligations, the Suppliers shall in no event have recourse
against the Consignor or any of its assets (and the
Suppliers acknowledge and agree that the Obligations are not
(nor shall they be deemed to be) obligations owing by the
Consignor; and
(b) the Consignor shall only be required to pay over
all or any portion of the amounts due under Sections 2.2,
2.4.2, Article III (other than clauses (a) and (e) of
Section 3.1.3), Article IV, Section 6.2, Section 6.3,
Section 8.3 and Section 8.4 (or any other amounts hereunder
to the extent such payment is expressly made contingent on
the Consignor first receiving such amount from the
Consignee) to the extent (and only to the extent) that the
Consignor first receives payment (in whole or in part as
applicable) with respect thereto in immediately available
funds from the Consignee or (in the case of a repayment or
prepayment of the Advances), the Consignee has first
returned to (or purchased from) the Consignor all or a
portion of the Bullion in respect of such Advances in each
case pursuant to the terms of the Fee Consignment Agreement
and Short-Term Fee Consignment Agreement.
Each of the Suppliers acknowledge and agree that if at any time
any payment made by the Consignor to a Supplier in respect of any
Obligations is subsequently rescinded, recovered from or repaid
by the Consignor for any reason other than to the extent of the
Consignor's gross negligence or wilful misconduct (including as
the result of any bankruptcy, dissolution, reorganization or
liquidation proceedings (or proceedings similar thereto) relating
to the Consignee), then each such Supplier shall repay to the
Consignor on demand that portion received by it of the amount so
rescinded, recovered from or repaid by the Consignor. Nothing in
this Section shall adversely affect any rights of any Suppliers
(when used in this Section, such term to mean and include all
Suppliers, under and as defined in this Agreement and the Short-
Term Dollar Supply Agreement) (i) to assert any claims against
the Consignor to the extent that the Consignor has actually
received from the Consignee all or any portion of the monetary
amounts that the Consignor is required to pay over to the
Suppliers hereunder or under the Short-Term Dollar Supply
Agreement or has actually received all or any portion of Bullion
(when used in this Section, such term to mean all Bullion, as
defined in the Fee Consignment Agreement and the Short-Term Fee
Consignment Agreement) that is required to be returned to the
Consignor under the terms of the Fee Consignment Agreement or the
Short-Term Fee Consignment Agreement (or has actually received,
in lieu of a return of Bullion, Dollars to the extent any such
Bullion is purchased by the Consignee pursuant to the terms of
the Fee Consignment Agreement or the Short-Term Fee Consignment
Agreement), and notwithstanding such actual receipt of monetary
amounts or Bullion (as the case may be), the Consignor has failed
to repay to the Suppliers any amount owing to them under the
terms hereof, under the Short-Term Dollar Supply Agreement or
under the Suppliers' Agreement, to the extent then due and
payable, or (ii) to direct the Consignor to accelerate the
Obligations and require the immediate return of Bullion to the
Consignor, as set forth in Section 6.2 and 6.3 of this Agreement
and Section 6.2 and 6.3 of the Short-Term Dollar Supply
Agreement. The Consignor agrees to indemnify and hold harmless
the Indemnified Parties from and against all actions, causes of
action and suits, and losses, costs, liabilities and actual (but
in no event consequential or punitive) damages hereunder arising
(i) by reason of a Consignor Bankruptcy Event, (ii) to the extent
and only to the extent from the gross negligence or wilful
misconduct of the Consignor (in its capacity as Consignor) or
(iii) from a breach hereunder or under the Fee Consignment
Agreement by the Consignor (in such capacity) at a time when no
Event of Default has occurred and is continuing.
SECTION 8.16. Waiver of Immunity; Judgment Currency.
(a) To the extent that the Consignor may have any immunity
on the grounds of sovereignty or otherwise from jurisdiction of
any court in the United States or from any legal process (whether
through service or notice, attachment prior to judgment,
attachment in aid of execution or otherwise) or from any legal
proceeding with respect to itself or its property, the Consignor
hereby irrevocably waives such immunity for itself and its
property (including, without limitation, property held by the
Consignor for its own account) with respect to its obligations
under this Agreement and the Suppliers' Agreement.
(b) If for the purpose of obtaining judgment in any court
it is necessary to calculate the equivalent of a sum due from the
Consignor under this Agreement which is denominated in Dollars in
another currency, the rate of exchange used shall be that at
which in accordance with normal banking procedures the Supplier
seeking such judgment could purchase Dollars with such other
currency on the Currency Business Day (defined below) preceding
that on which judgment is given. Notwithstanding any such
judgment in such other currency, the obligations of the Consignor
with respect to such sum due from it to the applicable Supplier
hereunder shall be discharged only to the extent that on the
Currency Business Day following receipt by such Supplier of such
amount adjudged to be so due in such other currency, such
Supplier, in accordance with normal banking procedures, can
purchase Dollars with such currency. If the Dollars so purchased
are less than the sum originally due to the applicable Supplier
in Dollars, the Consignor agrees as a separate obligation and
notwithstanding any such judgment to indemnify such Supplier
against such loss (other than any loss caused by such Supplier's
gross negligence and wilful misconduct) and to promptly pay to
such Supplier an amount such that such Supplier receives the full
sum originally due to such Supplier in Dollars; and if the
Dollars so purchased exceed such sum originally due to such
Supplier in Dollars, such Supplier agrees to remit such excess to
the Consignor. "Currency Business Day" means any day other than
a Saturday, Sunday or relevant holiday on which dealings in such
other currency and Dollars are carried out in the New York
interbank market and through official agencies of the country
where such other currency is available for purchase with Dollars.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
THE BANK OF NOVA SCOTIA,
in its capacity as Consignor
By: /s/ Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, N.Y. 10006
Facsimile No: 212-225-5090
Attention: Mr. Brian Allen
With a copy to:
Address: The Bank of Nova Scotia
44 King Street West
Toronto, Ontario
Canada M5H 1H1
Facsimile No: 416-866-4053
Attention: Mr. Peter Payne
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent and Co-Agent
By: /s/ Stephen Lochart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NOVA SCOTIA, in its capacity
as a Supplier
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Domestic
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
LIBOR
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NEW YORK, in its capacity as
a Co-Agent and a Supplier
By: /s/ William A. Kerr
Name: William A. Kerr
Title: Vice President
Domestic
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
LIBOR
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
PERCENTAGE
8.641975300% CHEMICAL BANK, in its capacity as
a Co-Agent and a Supplier
By: /s/ Theodore L. Parker
Name: Theodore L. Parker
Title: Vice President
Domestic
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
LIBOR
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
PERCENTAGE
7.514761100% FLEET PRECIOUS METALS INC.
By: /s/ W. Timothy Coggins/Eleanor Vander Mel
Name: W. Timothy Coggins/Eleanor Vander Mel
Title: Asst. Vice President/Vice President
Domestic
Office: 111 Westminster Street
Providence, RI 02903-2305
Facsimile No.: 401-278-3077
Attention: Dave Devel
LIBOR
Office: 111 Westminster Street
Providence, RI 02903-2305
Facsimile No.: 401-272-3440
Attention: Joyce Deschenes]
PERCENTAGE
7.514761100% NBD BANK, N.A.
By: /s/ Anna R. Hoffman
Name: Anna R. Hoffman
Title: Vice President
Domestic
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
LIBOR
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
PERCENTAGE
6.441223800% THE BANK OF TOKYO TRUST COMPANY
By: /s/ Jeffrey Miller
Name: Jeffrey Miller
Title:
Domestic
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
LIBOR
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
PERCENTAGE
6.441223800% LTCB TRUST COMPANY
By: /s/ Rene LeBlanc
Name: Rene LeBlanc
Title: Senior Vice President
Domestic
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
LIBOR
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
PERCENTAGE
6.441223800% SHAWMUT BANK, N.A.
By: /s/ Kerry Day
Name: Kerry Day
Title: Assistant Vice President
Domestic
Office: One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
LIBOR
Office: Shawmut Bank, N.A.
One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
PERCENTAGE
4.294149200% CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Vice President
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Authorized Signature
In both cases:
Domestic
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
LIBOR
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
For Credit Matters:
Attention: Andrea Griffis
PERCENTAGE
4.294149200% THE DAIWA BANK, LIMITED
By: /s/ J.H. Broadley
Name: J.H. Broadley
Title: Vice President
By: /s/ B.W. Henry
Name: B.W. Henry
Title: Vice President and Manager
Domestic
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
LIBOR
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
Address for
Notices: The Daiwa Bank, Limited
450 Lexinton Avenue
Suite 1700
New York, New York 10017
Facsimile No.: 212-818-0866
Attention: Catherine Tiano, Credit
Administration Assistant
PERCENTAGE
4.294149200% DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ Jeffrey N. Wieser
Name: Jeffrey N. Wieser
Title: Director
By: /s/ Jean M. Hannigan
Name: Jean M. Hannigan
Title: Assistant Vice President
Domestic
Office: Deutsche Bank AG,
New York and/or
Cayman Islands Branches
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
LIBOR
Office: Deutsche Bank AG,
Cayman Islands Branch
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
PERCENTAGE
4.294149200% THE FUJI BANK LTD.
By: /s/ Gina Kearns
Name: Gina Kearns
Title: Vice President and Manager
Domestic
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
LIBOR
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
PERCENTAGE
4.294149200% NATIONAL WESTMINSTER BANK USA
By: /s/ Phillip H. Sorace
Name: Phillip H. Sorace
Title: Vice President
Domestic
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
LIBOR
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
PERCENTAGE
3.220611900% ABN AMRO BANK N.V. NEW YORK BRANCH
By: /s/ Richard H. West
Name: Richard H. West
Title: Group Vice President
By: /s/ Rodolfo Barros
Name: Rodolfo Barros
Title: Vice President
Domestic
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
LIBOR
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
PERCENTAGE
3.220611900% BANQUE PARIBAS
By: /s/ Richard G. Burrows
Name: Richard G. Burrows
Title: Vice President
By: /s/ Ann C. Pifer
Name: Ann C. Pifer
Title: Assistant Vice President
Domestic
Office: 787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
LIBOR
Office: Banque Paribas
787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
PERCENTAGE
3.220611900% GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By: /s/ D. Stephens/John Redding
Name: Dhuane G. Stephens/John P. Redding
Title: Vice President
Domestic
Office: 65 East 55th Street
New York, New York 10022
Facsimile No: 212-644-0644
Attention: Dhuane Stephens
LIBOR
Office: 65 East 55th Street
New York, New York 10022
Facsimile No.: 212-421-2719
Attention: Orlando Diaz
PERCENTAGE
2.147074700% COMERICA BANK
By: /s/ Julie Burke Smith
Name: Julie Burke Smith
Title: Vice President
Domestic
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
LIBOR
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
PERCENTAGE
2.147074700% IBJ SCHRODER BANK & TRUST COMPANY
By: /s/ J. Christopher Mangan
Name: J. Christopher Mangan
Title: Vice President
Domestic
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
LIBOR
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
PERCENTAGE
2.147074700% THE MITSUBISHI BANK, LIMITED -
NEW YORK BRANCH
By: /s/ Paula Mueller
Name: Paula Mueller
Title: Vice President
Domestic
Office: 225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
LIBOR
Office: The Mitsubishi Bank, Limited
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
PERCENTAGE
2.147074700% YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By: /s/ Nicholas Pullen
Name: Nicholas Pullen
Title: Vice President
Domestic
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
LIBOR
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
100%
HANDY & HARMAN HAS REVIEWED THE TERMS OF
THIS AGREEMENT, AND ACKNOWLEDGES THE EFFECT
OF SUCH TERMS AS THEY RELATE TO HANDY &
HARMAN'S OBLIGATIONS UNDER SECTION 9.3 AND
SECTION 9.4 OF THE FEE CONSIGNMENT
AGREEMENT:
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Name: Stephen B. Mudd
Title: Vice President
and Treasurer
EXHIBIT 10.8
EXECUTION COPY
U.S. $125,375,000
SHORT-TERM DOLLAR SUPPLY AGREEMENT,
dated as of September 28, 1994
among
THE BANK OF NOVA SCOTIA,
as the Consignor,
CERTAIN FINANCIAL INSTITUTIONS,
as the Suppliers,
THE BANK OF NOVA SCOTIA,
CHEMICAL BANK
and
THE BANK OF NEW YORK,
as the Co-Agents for the Suppliers,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent for the Suppliers.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . . .
1.2. Use of Defined Terms . . . . . . . . . . . . . . .
1.3. Cross-References . . . . . . . . . . . . . . . . .
ARTICLE II
ADVANCE COMMITMENT AND MAKING OF ADVANCES
2.1. Advance Commitment . . . . . . . . . . . . . . . .
2.1.1. Advance Commitment . . . . . . . . . . . . . . . .
2.1.2. Suppliers Not Permitted or Required to Make
Advances . . . . . . . . . . . . . . . . . . . .
2.2. Reduction of Advance Commitment Amount . . . . . .
2.3. Advance Procedures and Funding; Participation in
Swing Line Consignments . . . . . . . . . . . .
2.3.1. Continuation Elections . . . . . . . . . . . . . .
2.3.2. Funding . . . . . . . . . . . . . . . . . . . . . .
2.4. Extension of Stated Maturity Date and Maturity of
Advances . . . . . . . . . . . . . . . . . . . .
2.4.1. Request for Extension of Stated Maturity and
Maturity of Advances . . . . . . . . . . . . . .
2.4.2. Consent to Extension of Stated Maturity Date and
Maturity of Advances . . . . . . . . . . . . . .
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments . . . . . . . . . . . .
3.1.1. Final Maturity . . . . . . . . . . . . . . . . . .
3.1.2. Acceleration of Stated Maturity Date . . . . . . .
3.1.3. Mandatory Prepayments of Advances . . . . . . . . .
3.2. Fees . . . . . . . . . . . . . . . . . . . . . . .
3.2.1. Funding Fee . . . . . . . . . . . . . . . . . . . .
3.2.2. Commitment Fees . . . . . . . . . . . . . . . . . .
3.2.3. Post-Maturity Rates . . . . . . . . . . . . . . . .
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . . .
4.2. Deposits Unavailable . . . . . . . . . . . . . . .
4.3. Increased LIBO Rate Advance Costs, etc. . . . . . .
4.4. Funding Losses . . . . . . . . . . . . . . . . . .
4.5. Increased Capital Costs . . . . . . . . . . . . . .
4.6. Taxes . . . . . . . . . . . . . . . . . . . . . . .
4.7. Payments, Computations, etc. . . . . . . . . . . .
4.8. Sharing of Payments . . . . . . . . . . . . . . . .
4.9. Use of Proceeds . . . . . . . . . . . . . . . . . .
4.10. Replacement of Suppliers . . . . . . . . . . . . .
4.11. Assignment to Administrative Agent . . . . . . . .
ARTICLE V
CONDITIONS TO ADVANCES
5.1. Initial Advance . . . . . . . . . . . . . . . . . .
5.1.1. Resolutions, etc. . . . . . . . . . . . . . . . . .
5.1.2. Revolving Credit Agreement and Short-Term Fee
Consignment Agreement Effectiveness . . . . . .
5.1.3. Opinions of Counsel . . . . . . . . . . . . . . . .
5.1.4. Closing Fees, Expenses, etc. . . . . . . . . . . .
5.2. All Advances . . . . . . . . . . . . . . . . . . .
5.2.1. No Default, etc. . . . . . . . . . . . . . . . . .
5.2.2. Advance Request . . . . . . . . . . . . . . . . . .
5.2.3. Satisfactory Legal Form . . . . . . . . . . . . . .
5.2.4. No Consignor Bankruptcy Event . . . . . . . . . . .
5.2.5. Advances Pursuant to Section 2.3.1 . . . . . . . .
ARTICLE VI
EVENTS OF DEFAULT
6.1. Listing of Events of Default . . . . . . . . . . .
6.1.1. Breach of Warranty . . . . . . . . . . . . . . . .
6.1.2. Default Under Material Agreements, etc. . . . . . .
6.1.3. Bankruptcy, Insolvency, etc. . . . . . . . . . . .
6.2. Action if Bankruptcy . . . . . . . . . . . . . . .
6.3. Action if Other Event of Default . . . . . . . . .
6.4. Consignor Bankruptcy Event . . . . . . . . . . . .
ARTICLE VII
THE AGENTS
7.1. Actions . . . . . . . . . . . . . . . . . . . . . .
7.2. Funding Reliance, etc. . . . . . . . . . . . . . .
7.3. Exculpation . . . . . . . . . . . . . . . . . . . .
7.4. Successor . . . . . . . . . . . . . . . . . . . . .
7.5. Advances by an Agent . . . . . . . . . . . . . . .
7.6. Credit Decisions . . . . . . . . . . . . . . . . .
7.7. Copies, etc. . . . . . . . . . . . . . . . . . . .
ARTICLE VIII
MISCELLANEOUS PROVISIONS
8.1. Waivers, Amendments, etc. . . . . . . . . . . . . .
8.2. Notices . . . . . . . . . . . . . . . . . . . . . .
8.3. Payment of Costs and Expenses . . . . . . . . . . .
8.4. Turn-Over of Certain Payments . . . . . . . . . . .
8.5. Survival . . . . . . . . . . . . . . . . . . . . .
8.6. Severability . . . . . . . . . . . . . . . . . . .
8.7. Headings . . . . . . . . . . . . . . . . . . . . .
8.8. Execution in Counterparts, Effectiveness, etc. . .
8.9. Governing Law; Entire Agreement . . . . . . . . . .
8.10. Successors and Assigns . . . . . . . . . . . . . .
8.11. Sale and Transfer of Advances; Participation in
Advances . . . . . . . . . . . . . . . . . . . .
8.11.1. Assignments . . . . . . . . . . . . . . . . . . . .
8.11.2. Participation . . . . . . . . . . . . . . . . . . .
8.12. Other Transactions . . . . . . . . . . . . . . . .
8.13. Forum Selection and Consent to Jurisdiction . . . .
8.14. Waiver of Jury Trial . . . . . . . . . . . . . . .
8.15. No Recourse . . . . . . . . . . . . . . . . . . . .
8.16. Waiver of Immunity; Judgment Currency . . . . . . .
EXHIBIT A - Form of Advance Request
EXHIBIT B - Form of Supplier Assignment Agreement
EXHIBIT C - Form of Continuation Notice
EXHIBIT D - Form of Extension Request
EXHIBIT E - Form of Suppliers' Agreement
EXHIBIT F - Form of Opinion of Senior Legal Counsel
to the Consignor
EXHIBIT G - Form of Opinion of New York Counsel
to the Consignor
SHORT-TERM DOLLAR SUPPLY AGREEMENT
THIS SHORT-TERM DOLLAR SUPPLY AGREEMENT, dated as of
September 28, 1994, among THE BANK OF NOVA SCOTIA ("Scotiabank")
as consignor (in such capacity, the "Consignor"), the various
financial institutions as are or may become parties hereto
(collectively, the "Suppliers"), SCOTIABANK, CHEMICAL BANK
("Chemical") and THE BANK OF NEW YORK ("BONY") as the co-agents
(in such capacity, the "Co-Agents") for the Suppliers, and
Scotiabank, as administrative agent (in such capacity, together
with any successor appointed pursuant to Section 7.4, the
"Administrative Agent") for the Suppliers,
W I T N E S S E T H:
WHEREAS, the Consignor and Handy & Harman, a New York
corporation (the "Consignee"), are parties to a Short-Term Fee
Consignment Agreement dated as of the date hereof (as amended,
supplemented, amended and restated or otherwise modified pursuant
to the terms thereof, the "Short-Term Fee Consignment
Agreement"), pursuant to which the Consignor will from time to
time consign up to 110,000 troy ounces of gold and up to
11,250,000 troy ounces of silver (such gold and silver
collectively referred to as the "Bullion"), all in accordance
with the terms and conditions thereof;
WHEREAS, the Suppliers will provide the Advance Commitment
pursuant to which each Supplier will make Advances of Dollars in
connection with consignments of Bullion by the Consignor to the
Consignee pursuant to the Short-Term Fee Consignment Agreement;
and
WHEREAS, the Suppliers are willing, on the terms and
conditions hereinafter set forth (including Article V), to make
such Advances and extend the Advance Commitment hereunder;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its
preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be
equally applicable to the singular and plural forms thereof):
"Administrative Agent" is defined in the preamble.
"Advances" is defined in Section 2.1.1.
"Advance Commitment" is defined in Section 2.1.1.
"Advance Commitment Amount" means $125,375,000, as such
amount may be reduced from time to time pursuant to Section 2.2.
"Advance Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Advance Commitment Amount is
terminated in full or reduced to zero pursuant to Section
2.2;
(c) the occurrence of any Default described in clauses
(a) through (d) of Section 6.1.3;
(d) the occurrence and continuance of any other Event
of Default and either
(i) the declaration of the Obligations of the
Consignee under the Short-Term Fee Consignment
Agreement to be due and payable pursuant to Section 8.3
thereof, or
(ii) in the absence of such declaration, the
giving of notice by the Administrative Agent, acting at
the direction of the Required Suppliers, to the
Consignor and the Consignee that the Advance Commitment
has been terminated; and
(e) the occurrence of any Consignor Bankruptcy Event.
Upon the occurrence of any event described in clause (b), (c) or
(e) the Advance Commitment shall terminate automatically and
without further action.
"Advance Document" means this Agreement, each Advance
Request, each Extension Request, each Supplier Assignment
Agreement, the Suppliers' Agreement and each Continuation
Request.
"Advance Request" means a notice requesting Advances
executed and delivered by the Consignor, substantially in the
form of Exhibit A attached hereto.
"Affected Supplier" is defined in Section 4.3.
"Affiliate" is defined in the Revolving Credit Agreement.
"Agent" means, as the context may require, any Co-Agent or
the Administrative Agent.
"Agreement" means, on any date, this Short-Term Dollar
Supply Agreement as originally in effect on the Effective Date
and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to
all Base Rate Advances, a fluctuating per annum rate equal to the
higher of
(a) the rate of interest most recently established by
Scotiabank at its Domestic Office as its base rate for
Dollar loans in the United States; and
(b) the Federal Funds Rate for such date plus 1/2 of
1%.
The Alternate Base Rate is not necessarily intended to be the
lowest rate of interest determined by Scotiabank in connection
with extensions of credit. Changes in Obligations accruing
interest at the Alternate Base Rate will take effect
simultaneously with each change in the Alternate Base Rate. The
Administrative Agent will give prompt notice to the Consignee and
the Suppliers of changes in the Alternate Base Rate.
"Assignee Supplier" is defined in Section 8.11.1.
"Authorized Officer" means those officers of the Consignee
whose signatures and incumbency shall have been certified to the
Administrative Agent and the Suppliers pursuant to Article V.
"Base Rate Advance" means each Advance pursuant to which the
Funding Fee accrues at a fluctuating rate determined by reference
to the Alternate Base Rate.
"BONY" is defined in the preamble.
"Bullion" is defined in the first recital.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to
be closed in New York, New York, U.S.A. or Toronto, Ontario,
Canada and on which dealings in Dollars are carried on in
the London interbank market; and
(b) in the case of any location to which Bullion is to
be delivered or received, a day that transactions in Bullion
can be carried out at such location.
"Chemical" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Consignee" is defined in the first recital.
"Consignor" is defined in the preamble.
"Consignor Bankruptcy Event" means the Consignor shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignor or any property of any thereof,
or make a general assignment for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignor or for a substantial part of the property of any
thereof;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignor; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing.
"Continuation Date" is defined in clause (a) of Section
3.1.3.
"Continuation Notice" means a notice of continuation duly
executed by the Consignor pursuant to the terms hereof,
substantially in the form of Exhibit C attached hereto.
"Default" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.
"Dollar" and the symbol "$" mean lawful money of the United
States.
"Dollar Supply Agreement" means the Dollar Supply Agreement,
dated as of the date hereof, among the Consignor, the financial
institutions from time to time parties thereto, Scotiabank, BONY
and Chemical, as co-agents and Scotiabank, as administrative
agent, as amended, supplemented, amended and restated or
otherwise modified from time to time pursuant to the terms
thereof.
"Domestic Office" means, relative to any Supplier, the
office of such Supplier designated as such below its signature
hereto or designated in the Supplier Assignment Agreement or such
other office of a Supplier (or any successor or assign of such
Supplier) within the United States as may be designated from time
to time by notice from such Supplier, as the case may be, to each
other party hereto.
"Effective Date" means the date this Agreement becomes
effective pursuant to Section 8.8.
"Environmental Law" is defined in the Revolving Credit
Agreement.
"Event of Default" is defined in Section 6.1.
"Extension Request" means an extension request duly executed
by the Consignor, substantially in the form of Exhibit D hereto.
"Federal Funds Rate" means, for any day, a fluctuating
interest rate per annum equal for such day to the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is not a
Business Day in the City of New York, for the next preceding
Business Day) by the Federal Reserve Bank of New York; provided,
however, that if such rate is not so published for any day which
is a Business Day in the City of New York, the rate for such day
shall be the average of the quotations for such day on such
transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it.
"Fee Consignment Agreement" means the Fee Consignment
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified), between The Bank of
Nova Scotia (as consignor) and Handy and Harman (as consignee).
"Fee Letter" is defined in the Revolving Credit Agreement.
"Funding Fee" is defined in Section 3.2.1.
"Funding Period" means, relative to any Advance, the period
beginning on (and including) the date on which such Advance is
made or continued as an Advance pursuant to Section 2.3 or 2.3.1
and shall end on (but exclude) the day which numerically
corresponds to such date one, two or three months (or such other
period, if agreed to by all the Suppliers) thereafter (or, if
such month has no numerically corresponding day, on the last
Business Day of such month), in each case equal to a
corresponding Consignment Period as requested by the Consignee
under the Short-Term Fee Consignment Agreement as the Consignor
will notify to the Suppliers in its relevant notice pursuant to
Section 2.3 or 2.3.1; provided, however, that
(a) Funding Periods commencing on the same date for
Advances in respect of the same consignment of Bullion shall
be of the same duration,
(b) if such Funding Period would otherwise end on a
day which is not a Business Day, such Funding Period shall
end on the next following Business Day; provided, however,
that if such next following Business Day is the first
Business Day of a calendar month, such Funding Period shall
end on the next preceding Business Day, and
(c) no Funding Period may end later than the Stated
Maturity Date.
No more than ten Funding Periods shall be in effect at any one
time.
"Hazardous Material" is defined in the Revolving Credit
Agreement.
"herein", "hereof", "hereto", "hereunder" and similar terms
contained in this Agreement or any other Advance Document refer
to this Agreement or such other Advance Document, as the case may
be, as a whole and not to any particular Section, paragraph or
provision of this Agreement or such other Advance Document.
"including" means including without limiting the generality
of any description preceding such term, and, for purposes of this
Agreement and each other Advance Document, the parties hereto
agree that the rule of ejusdem generis shall not be applicable to
limit a general statement, which is followed by or referable to
an enumeration of specific matters or to matters specifically
mentioned.
"Indemnified Liabilities" is defined in Section 8.4.
"Indemnified Parties" is defined in Section 8.4.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Advance" means each Advance pursuant to which the
Funding Fee accrues at a rate determined by reference to the LIBO
Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, relative to any Supplier, the office
of such Supplier designated as such below its signature hereto or
designated in a Supplier Assignment Agreement or such other
office of a Supplier as designated from time to time by notice
from such Supplier to the Consignee and the Administrative Agent,
whether or not outside the United States, which shall be making
or maintaining LIBO Rate Advances.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or otherwise), charge against or interest in property
to secure payment of a debt or performance of an obligation or
other priority or preferential arrangement of any kind or nature
whatsoever.
"Non-Consenting Supplier" is defined in clause (c) of
Section 2.4.2.
"Non-Recourse Joint Venture" is defined in the Revolving
Credit Agreement.
"Obligations" means all obligations (monetary or otherwise)
of the Consignee arising under or in respect of the Short-Term
Fee Consignment Agreement.
"Organic Document" means, relative to the Consignee, its
certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.
"Participant" is defined in Section 8.11.2.
"Percentage" means, relative to any Supplier, the percentage
set forth opposite its signature hereto or set forth in a
Supplier Assignment Agreement, as such percentage may be adjusted
from time to time pursuant to Supplier Assignment Agreement(s)
executed by such Supplier and its Assignee Supplier(s) and
delivered pursuant to Section 8.11.1.
"Person" means any natural person, corporation, partnership,
firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or other
capacity.
"Quarterly Payment Date" means the last day of each March,
June, September and December or, if any such day is not a
Business Day, the next succeeding Business Day.
"Release" is defined in the Revolving Credit Agreement.
"Replacement Notice" is defined in Section 4.10.
"Required Suppliers" means, at any time, Suppliers whose
Percentages equal or exceed 51%.
"Revolving Credit Agreement" means the Revolving Credit
Agreement, dated as of the date hereof (as amended, supplemented,
amended and restated or otherwise modified from time to time
pursuant to the terms thereof), among the Consignee, certain
financial institutions from time to time parties thereto,
Chemical, BONY and Scotiabank as co-agents and Scotiabank, as the
administrative agent; provided that if the Revolving Credit
Agreement shall be refinanced or otherwise terminated and no
longer of force and effect at a time when this Agreement is still
in effect, then for purposes of this Agreement the "Revolving
Credit Agreement" shall mean the Revolving Credit Agreement, as
in effect immediately prior to the date of such refinancing or
termination.
"Scotiabank" is defined in the preamble.
"Short-Term Fee Consignment Agreement" is defined in the
first recital.
"Short Term Revolving Credit Agreement" is defined in the
Revolving Credit Agreement.
"Stated Maturity Date" means September 26, 1995, as such
date may be extended from time to time pursuant to Section 2.4.
"Subject Supplier" is defined in Section 4.10.
"Subsidiary" means, with respect to any Person, any
corporation of which more than 50% of the outstanding capital
stock having ordinary voting power to elect a majority of the
board of directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence
of any contingency) is at the time directly or indirectly owned
by such Person, by such Person and one or more other Subsidiaries
of such Person, or by one or more other Subsidiaries of such
Person.
"Substitute Rate" is defined in Section 3.2.1.
"Supplier Assignment Agreement" means a Supplier Assignment
Agreement substantially in the form of Exhibit B attached hereto.
"Suppliers" is defined in the preamble.
"Suppliers' Agreement" means the Suppliers' Agreement, dated
as of the date hereof (as amended, supplemented, amended and
restated or otherwise modified from time to time pursuant to the
terms thereof), among the Consignor, the Suppliers (as defined
herein and in the Dollar Supply Agreement) and the Administrative
Agent, substantially in the form attached hereto as Exhibit E.
"Taxes" is defined in Section 4.6.
"type" means, relative to any Advance, the portion thereof,
if any, being maintained as a Base Rate Advance or a LIBO Rate
Advance.
"United States" or "U.S." means the United States of
America, its fifty States and the District of Columbia.
"Valuation Date" is defined in clause (a) of Section 3.1.3.
SECTION 1.2. Use of Defined Terms. Unless otherwise
defined or the context otherwise requires,
(a) terms for which meanings are provided in this
Agreement shall have such meanings when used in any Advance
Document, notice and other communication delivered from time
to time in connection with this Agreement or any other
Advance Document; and
(b) terms used in this Agreement or any Advance
Document that are not defined herein (or in such Advance
Document) are used herein with the meanings set forth in the
Short-Term Fee Consignment Agreement.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Advance Document
to any Article or Section are references to such Article or
Section of this Agreement or such other Advance Document, as the
case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to
such clause of such Article, Section or definition.
ARTICLE II
ADVANCE COMMITMENT AND MAKING OF ADVANCES
SECTION 2.1. Advance Commitment. On the terms and subject
to the conditions of this Agreement (including Article V), each
Supplier severally agrees to make Advances to the Consignor
pursuant to the Advance Commitment described in Section 2.1.1;
provided, that all payments and repayments of such Advances are
subject to the terms of Section 8.15.
SECTION 2.1.1. Advance Commitment. From time to time on
any Business Day occurring prior to the Advance Commitment
Termination Date, each Supplier will advance Dollars to the
Administrative Agent in respect of other than Swing Line
Consignments to be forwarded to the Consignor (relative to such
Supplier, its "Advances") equal to such Supplier's Percentage of
the aggregate amount of the Advances required pursuant to Section
2.3 or Section 2.3.1 to be made on such day. The commitment of
each Supplier described in this Section 2.1.1 is herein referred
to as its "Advance Commitment". On the terms and subject to the
conditions hereof, the Consignor may from time to time prior to
the Advance Commitment Termination Date have Advances funded to
it, prepay such Advances following the return or purchase of
Bullion (or other gold or silver) by the Consignee under the
Short-Term Fee Consignment Agreement and have additional Advances
funded to it in connection with consignments of Bullion
thereunder.
SECTION 2.1.2. Suppliers Not Permitted or Required to Make
Advances. No Supplier shall be permitted or required to make any
Advance if, after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(a) to all Suppliers would exceed the Advance
Commitment Amount (after giving effect to any actual or
contingent obligation with respect to outstanding Swing Line
Consignments), which obligation shall be deemed to equal the
then Dollar Value of gold and/or the then Dollar Value of
silver as applicable, multiplied by the number of troy
ounces of gold or troy ounces of silver (or both, if
applicable) that are then consigned pursuant to Swing Line
Consignments; or
(b) to such Supplier would exceed such Supplier's
Percentage multiplied by the Advance Commitment Amount.
SECTION 2.2. Reduction of Advance Commitment Amount.
Subject to the satisfaction of the conditions set forth in
Section 5.2.5, upon the occurrence of a voluntary reduction in
whole or in part of the Commitment Amount pursuant to Section
2.2.1 of the Short-Term Fee Consignment Agreement, there shall
also occur an automatic and contemporaneous reduction in the
Advance Commitment Amount hereunder in an amount equal to the
number of troy ounces of gold or troy ounces of silver (or both,
if applicable) by which the Commitment Amount under the Short-
Term Fee Consignment Agreement is being reduced, multiplied by
$475 (in the case where a reduction in the Commitment Amount is
in respect of gold) and $6.50 (in the case where a reduction in
the Commitment Amount is in respect of silver).
SECTION 2.3. Advance Procedures and Funding; Participation
in Swing Line Consignments. (a) This clause (a) sets forth the
procedure for funding of Advances (other than in respect of Swing
Line Consignments). Promptly following receipt of a Consignment
Request from the Consignee, the Consignor agrees to deliver an
Advance Request for a Funding Period that is the same duration of
the requested Consignment Period to the Administrative Agent
pursuant to which the Consignor will request, on at least three
but no more than five Business Days' prior notice, that an
Advance be made by all the Suppliers in a minimum amount of
$10,000,000, or, if less, in the unused amount of the Advance
Commitment Amount. In connection with any consignment of Bullion
under the Short-Term Fee Consignment Agreement, the Consignor
shall not agree to a Consignment Period of other than one, two or
three months unless all the Suppliers have first consented to
such other Consignment Period. The Administrative Agent agrees
to promptly notify each Supplier of the receipt of each Advance
Request. The amount of the Advance in respect of any given
Consignment Request shall equal the Dollar Value of gold or the
Dollar Value of silver (or both, if applicable as determined by
the Consignor and notified to the Administrative Agent) as in
effect three Business Days prior to the making of the Advance,
multiplied by the number of troy ounces of gold or troy ounces of
silver (or both, if applicable) that the Consignee is requesting
be consigned to it by the Consignor. On the terms and subject to
the conditions of this Agreement, each Advance shall be made on
the Business Day specified in such Advance Request. On or before
11:00 a.m. (New York City time) on the Business Day that such
Advance is to be made, each Supplier shall deposit with the
Administrative Agent immediately available funds in an amount
equal to such Supplier's Percentage of the requested Advance.
Such deposit will be made to an account which the Administrative
Agent shall specify from time to time by notice to the Suppliers.
No Supplier's obligation to make any Advance shall be affected by
any other Supplier's failure to make any Advance.
(b) If and to the extent that, following an Event of
Default, Bullion consigned pursuant to a Swing Line Consignment
is not returned to the Consignor or purchased by the Consignee
pursuant to the terms of the Short-Term Fee Consignment
Agreement, the Consignor may, upon no less than four Business
Days' prior notice by delivery of an Advance Request to the
Administrative Agent, subject to Section 2.1.2, require all
Suppliers to fund Advances in immediately available funds in an
amount equal to such Supplier's Percentage of the Dollar Value of
gold and/or the Dollar Value of silver (or both, if applicable)
as in effect three Business Days prior to the date such Advances
are to be made, multiplied by the number of ounces of gold and/or
silver, as applicable, then held by the Consignee under Swing
Line Consignments, and thereafter such Advances shall constitute
an Advance made by such Supplier hereunder with a Funding Period
of one month. Each Supplier shall be required to make the
Advances contemplated by this Section, notwithstanding the
occurrence and continuance of an Event of Default on the date
such Advances are to be made.
SECTION 2.3.1. Continuation Elections. Promptly following
the delivery of a Continuation/Return Notice to the Consignor in
accordance with Section 2.3.1 of the Short-Term Fee Consignment
Agreement in which the Consignee is requesting that all or any
portion of previously consigned Bullion is to remain consigned to
the Consignee pursuant to the terms of the Short-Term Fee
Consignment Agreement, the Consignor will deliver to the
Administrative Agent a Continuation Notice with respect to the
previously funded corresponding Advances (and, if Bullion
previously consigned under a Swing Line Consignment is to be
continued with a then maturing consignment of Bullion under
Section 2.3.1 of the Short-Term Fee Consignment Agreement, the
Continuation Notice shall include an amount of Advances in
respect of such Bullion calculated in accordance with the next
sentence) that were made hereunder, pursuant to which the
Suppliers shall continue all, or any applicable portion of, such
Advances following the last day of a Funding Period with respect
thereto (subject to Sections 4.1, 4.2 and 4.3) as a LIBO Rate
Advance, and in the absence of delivery of a Continuation Notice
with respect to any Advance at least four but not more than five
Business Days prior to the last day of the then current Funding
Period with respect thereto, such Advance (and, if pursuant to
Section 2.3.1 of the Short-Term Fee Consignment Agreement,
Bullion consigned under Swing Line Consignments is to be
continued with Bullion not previously consigned under Swing Line
Consignments, a corresponding amount of Advances in an amount as
determined below) shall, on such last day, automatically continue
for a Funding Period of one month and, in such event, the
Consignor will deliver to the Administrative Agent a Continuation
Notice with respect to the previously funded corresponding
Advances that were made hereunder, pursuant to which the
Suppliers shall, subject to the satisfaction of the conditions
set forth in Section 5.2.5, continue all such Advances following
the last day of the then expiring Funding Period with respect
thereto (subject to Sections 4.1, 4.2 and 4.3) as a LIBO Rate
Advance for a Funding Period of one month. The amount of the
Advances in respect of any such Continuation Notice shall equal
the Dollar Value of gold or the Dollar Value of silver (or both,
if applicable, and, subject to the last sentence of this Section,
including any Bullion that was previously consigned under Swing
Line Consignments that is then to be continued under consignment
as other than Swing Line Consignments) as in effect three
Business Days prior to the continuation of the Advance,
multiplied by the number of troy ounces of gold or troy ounces of
silver (or both, if applicable, and including any Bullion that
was previously consigned under Swing Line Consignments that is
then to be continued under consignment as other than Swing Line
Consignments) that the Consignee has requested be continued under
consignment by the Consignor. Subject to the proviso set forth
below in this Section, to the extent such Dollar Value of gold or
Dollar Value of silver (as applicable) three Business Days prior
to the first day of the next succeeding Funding Period as
notified to the Administrative Agent and the Suppliers by the
Consignor
(a) exceeds that which was in effect three Business
Days prior to the date the relevant consignment was
originally made (or subsequently continued pursuant to
Section 2.3.1 of the Short-Term Fee Consignment Agreement),
then the Suppliers shall (subject to Section 5.2.5) fund
Advances to the Administrative Agent on the first day of
such next succeeding Funding Period in an amount equal to
such Supplier's Percentage multiplied by such excess; and
(b) is less than that which was in effect three
Business Days prior to the date the relevant consignment was
originally made (or subsequently continued pursuant to
Section 2.3.1 of the Short-Term Fee Consignment Agreement),
then the Consignor shall repay Advances to the
Administrative Agent on the last day of the then expiring
Funding Period in an amount equal to such difference
pursuant to clause (a) of Section 3.1.3;
provided, however, that subject to Section 2.1.2 the calculations
required in clauses (a) and (b) above shall be made without
giving effect to any Bullion that was, on the day immediately
preceding the date that the applicable Funding Period is to be
extended, consigned under Swing Line Consignments. If the
Consignee is including in the applicable Consignment Period any
Bullion that was previously consigned pursuant to a Swing Line
Consignment in the continuation of Bullion under consignment, as
set forth in Section 2.3.1 of the Short-Term Fee Consignment
Agreement, then the Suppliers shall fund Advances on the first
day of such next succeeding Funding Period to the Administrative
Agent in an amount equal to such Supplier's Percentage of the
Dollar Value of gold or the Dollar Value of silver (or both, if
applicable) as in effect three Business Days prior to the
continuation of Advances contemplated by this Section, multiplied
by the number of troy ounces of gold or troy ounces of silver (or
both, if applicable) that were theretofore held under Swing Line
Consignments but are being continued under consignment as other
than Swing Line Consignments.
SECTION 2.3.2. Funding. Each Supplier may, if it so
elects, fulfill its obligation to advance or continue LIBO Rate
Advances hereunder by causing one of its foreign branches or
affiliates (or an international banking facility created by such
Supplier) to advance or continue such LIBO Rate Advance;
provided, however, that such LIBO Rate Advance shall nonetheless
be deemed to have been made and to be held by such Supplier, and
the obligation to repay such LIBO Rate Advance shall nevertheless
be to such Supplier for the account of such foreign branch,
affiliate or international banking facility.
SECTION 2.4. Extension of Stated Maturity Date and Maturity
of Advances. Each of (i) the Stated Maturity Date and (ii) the
obligation, pursuant to Section 3.1.1, to make a mandatory
repayment of the outstanding principal amount of Advances on the
Stated Maturity Date, shall be subject to extension or
postponement, as the case may be, as set forth in this Section.
SECTION 2.4.1. Request for Extension of Stated Maturity and
Maturity of Advances. Any term or provision of this Agreement to
the contrary notwithstanding, promptly after the delivery of a
Consignment Extension Request by the Consignee to the Consignor
pursuant to the terms of the Short-Term Fee Consignment Agreement
in respect of which the Consignor is willing to extend the Stated
Maturity Date, the Consignor shall, by delivery of a duly
completed Extension Request to each Supplier, irrevocably request
that each Supplier extend for a period not in excess of 364 days
the then existing Stated Maturity Date.
SECTION 2.4.2. Consent to Extension of Stated Maturity Date
and Maturity of Advances.
(a) Each Supplier shall, within 30 days of receipt of
an Extension Request, notify the Administrative Agent
whether or not it consents to the extension set forth in
such Extension Request, such consent to be in the sole
discretion of such Supplier. If any Supplier does not so
notify the Administrative Agent of its decision within such
30 day period, such Supplier shall be deemed not to have
consented to such request.
(b) The Administrative Agent shall promptly notify the
Consignor and the Consignee whether the Suppliers have
consented to such request. If the Administrative Agent does
not so notify the Consignor within 35 days following the
date the Consignor receives the applicable Consignment
Extension Request from the Consignee, the Administrative
Agent shall be deemed to have notified the Consignor that
the Suppliers have not consented to such request.
(c) Each Supplier that elects not to provide a new
Advance Commitment upon the expiration of the then effective
Stated Maturity Date or that fails to so notify the
Administrative Agent of such consent (a "Non-Consenting
Supplier") hereby agrees that if, on or prior to the then
effective Stated Maturity Date, any other Supplier or other
financial institution acceptable to the Consignor and the
Consignee offers to purchase such Non-Consenting Supplier's
Percentage of the Advance Commitment (and other amounts and
commitments, as required pursuant to Section 8.11.1) for a
purchase price equal to the sum of all amounts then owing
with respect to the Advances and all other amounts accrued
for the account of such Non-Consenting Supplier, such Non-
Consenting Supplier will assign, sell and transfer on the
then effective Stated Maturity Date all of its right, title,
interest and obligations with respect to the foregoing to
such other Supplier or financial institution pursuant to the
terms of Section 8.11.1, and the fee payable pursuant to
Section 8.11.1 shall be payable by such Assignee Supplier.
(d) The Advances of any Non-Consenting Supplier that
were not purchased pursuant to clause (c) will mature and be
due and payable, and such Non-Consenting Supplier's Advance
Commitment will terminate, on the then scheduled Stated
Maturity Date. On each such date, the Advance Commitment
Amount will be automatically reduced by an amount equal to
the product of
(i) the sum of the Percentages of all Non-
Consenting Suppliers that were not purchased pursuant
to clause (c), and
(ii) the Advance Commitment Amount (whether used
or unused) on such Stated Maturity Date immediately
prior to such calculation.
(e) On the date that would have been the Stated
Maturity Date had the Advance Commitment not been extended
pursuant to the terms of this Section, the Percentages of
the remaining Suppliers which have consented to an extension
of their Advance Commitment hereunder shall be adjusted
accordingly by the Administrative Agent, based on such
Suppliers' pro rata share of the remaining Advance
Commitment Amount.
Notwithstanding anything to the contrary contained in this
Section, the Stated Maturity Date of those Suppliers consenting
to such an extension shall not be extended for an additional one
year period unless (i) Suppliers whose Percentages equal or
exceed 75% (after giving effect to the operation of clause (c))
have so consented to such extension, and (ii) the Consignor has
consented to a corresponding extension of the Consignment
Maturity Date pursuant to Section 2.4.2 of the Short-Term Fee
Consignment Agreement.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. Repayments and
prepayments of Advances shall be made as set forth in this
Section 3.1. Each repayment or prepayment of any Advance made
pursuant to this Section 3.1 shall be without premium or penalty,
except as may be required to be paid (subject to Section 8.15)
pursuant to Section 4.4. No prepayment of principal of any
Advances shall cause a reduction in the Advance Commitment
Amount. Notwithstanding anything to the contrary in this
Agreement or any other Advance Document, the parties hereto
acknowledge and agree that (other than as required pursuant to
clauses (a) and (e) of Section 3.1.3) each repayment and
prepayment of Advances by the Consignor to the Suppliers, and all
liability of the Consignor to the Suppliers in respect of such
payments, shall be subject to the provisions of Section 8.15 and
shall only arise as against the Consignor to the extent (and only
to the extent) that Bullion (or other gold and/or silver, as
applicable) has been purchased by the Consignee from the
Consignor (and the Consignor shall have received in immediately
available funds the purchase price of such Bullion) or has been
returned to the Consignor by the Consignee as required on the
dates and in accordance with the terms of the Short-Term Fee
Consignment Agreement; provided, that if the full amount of
Bullion (or other gold and/or silver, as applicable) is returned
to the Consignor, or the Consignor receives the entire amount of
the purchase price agreed to in respect of a purchase of such
Bullion, in each case on a date that is later than that which is
required pursuant to the terms of the Short-Term Fee Consignment
Agreement, then the Consignor agrees that it will make the
payments otherwise required pursuant to Section 3.1.3 on the date
such Bullion was returned or purchased, as the case may be.
SECTION 3.1.1. Final Maturity. To the extent (but only to
the extent) that all then consigned Bullion (or other gold and/or
silver, as applicable) is returned from consignment to the
Consignor and/or purchased by the Consignee on such date in
accordance with the terms of the Short-Term Fee Consignment
Agreement, on the Stated Maturity Date, the Consignor shall repay
the unpaid principal amount of all Advances upon the Stated
Maturity Date. If less than all previously consigned Bullion (or
other gold and/or silver, as applicable) is returned from
consignment or is purchased by the Consignee pursuant to the
terms of the Short-Term Fee Consignment Agreement on the Stated
Maturity Date, then as between the Consignor and the Suppliers
the terms of the Suppliers' Agreement shall be applied to
determine the principal amount of the Advances that will be
repaid to the Suppliers on the Stated Maturity Date (provided,
that the Consignee's failure to return (or purchase, as
applicable) all Bullion on the Stated Maturity Date shall
nevertheless constitute an Event of Default, and any acceptance
of any partial repayment or return of Bullion (as applicable)
shall not be deemed to be a waiver of any terms or provisions of,
or otherwise release the Consignee from complete performance of
its Obligations under, the Short-Term Fee Consignment Agreement).
SECTION 3.1.2. Acceleration of Stated Maturity Date. Upon
any acceleration of the Stated Maturity Date pursuant to
Section 6.2 or Section 6.3 the Consignor shall, to the extent
(and only to the extent) that all previously consigned Bullion
(or other gold and/or silver, as applicable) has first been
returned to it from consignment by the Consignee, or has been
purchased from the Consignor by the Consignee pursuant to the
terms of the Short-Term Fee Consignment Agreement, repay the
outstanding amount of all Advances on the date of such delivery
or purchase of Bullion (or other gold and/or silver). If, upon
(or at any time after) the acceleration of the Stated Maturity
Date pursuant to Section 6.2 or Section 6.3, the Consignee shall
return to or purchase from the Consignor less than all previously
consigned Bullion (or other gold and/or silver, as applicable),
then as between the Consignor and the Suppliers the terms of the
Suppliers' Agreement shall be applied to determine the principal
amount of the Advances that will be repaid upon such return to or
purchase from the Consignor (provided, that the Consignee's
failure to return (or purchase, as applicable) all Bullion on the
date of any acceleration of the Stated Maturity Date shall
nevertheless constitute an Event of Default, and any acceptance
of any partial repayment or return of Bullion (as applicable)
shall not be deemed to be a waiver of any terms or provisions of,
or otherwise release the Consignee from complete performance of
its Obligations under, the Short-Term Fee Consignment Agreement).
SECTION 3.1.3. Mandatory Prepayments of Advances. The
Consignor shall make mandatory prepayments of the Advances as
follows:
(a) to the extent that the Dollar Value of gold or the
Dollar Value of silver (or both, if applicable) on the date
that is three Business Days prior to the continuation of a
consignment of all or a portion of Bullion (other than, and
without regard to the Dollar Value of, Bullion that was,
immediately preceding such continuation, consigned under a
Swing Line Consignment) pursuant to Section 2.3.1 of the
Short-Term Fee Consignment Agreement (such date being
referred to as the "Continuation Date") is less than that
which was in effect three Business Days prior to when the
relevant consignment (and the corresponding Funding Period
hereunder with respect to such consignment) was originally
made or, if applicable, subsequently continued pursuant to
Section 2.3.1 of the Short-Term Fee Consignment Agreement
(such date being referred to as the "Valuation Date"), the
Consignor shall repay the Advances on the last day of such
then expiring Funding Period, pro rata to the Suppliers in
accordance with their respective Percentages, in an amount
equal to (i) the Dollar Value of gold or the Dollar Value of
silver (or both, if applicable) that existed on the
Valuation Date, multiplied (as applicable) by the number of
ounces of gold and/or the number of ounces of silver (other
than Bullion that was, immediately preceding such
continuation, consigned under a Swing Line Consignment) that
was consigned under the corresponding Consignment Period
minus (ii) the Dollar Value of gold or the Dollar Value of
silver (or both, if applicable) that existed on the
Continuation Date multiplied (as applicable) by the number
of ounces of gold and/or the number of ounces of silver
(other than Bullion that was, immediately preceding such
continuation, consigned under a Swing Line Consignment) to
be continued under consignment pursuant to the relevant
Continuation/Return Notice;
(b) on each date when Bullion (other than Bullion that
was and then remains held under Swing Line Consignments) is
purchased from the Consignor by the Consignee pursuant to
the terms of Section 2.3.3 of the Short-Term Fee Consignment
Agreement, regardless of the price agreed to between the
Consignor and the Consignee, the Consignor shall make a
mandatory prepayment of Advances in an amount equal to the
Dollar Value of gold or the Dollar Value of silver (or both,
if applicable) that was in effect on the Valuation Date
corresponding to the applicable Consignment Period of the
Bullion that is being purchased, multiplied by the number of
ounces of Bullion so purchased;
(c) on the last day of each Consignment Period when
Bullion (or other gold or silver, as applicable), other than
Bullion that was and then remains consigned under Swing Line
Consignments, is returned (and not continued under
consignment) to the Consignor by the Consignee, the
Consignor shall make a mandatory prepayment of Advances in
an amount equal to the Dollar Value of gold or the Dollar
Value of silver (or both, if applicable) that was in effect
on the Valuation Date corresponding to such applicable
Consignment Period in respect of which gold or silver is
being returned to the Consignor, multiplied by the number of
ounces of gold and/or silver actually returned to the
Consignor;
(d) on each date and to the extent that the Consignee
has returned Bullion (other than Bullion that was and then
remains held under Swing Line Consignments) to the Consignor
(or delivered to the Consignor other gold or silver, as
applicable) prior to the last day of the related Consignment
Period in accordance with Section 3.1.2 of the Short-Term
Fee Consignment Agreement or Bullion has been deemed to have
been returned to the Consignor pursuant to clause (b)(i) of
Section 3 of the Suppliers' Agreement, the Consignor shall
make a mandatory prepayment of Advances equal to the Dollar
Value of gold or the Dollar Value of silver (or both, if
applicable) that was in effect on the Valuation Date
corresponding to such Consignment Period (other than Bullion
that was held and then remains under Swing Line
Consignments), multiplied by the number of ounces of gold
and/or silver actually returned or deemed returned to the
Consignor; and
(e) on each date and to the extent that (i) any
Bullion with respect to which the Suppliers have made
Advances is lost or damaged prior to its delivery to either
Plant (as set forth in Section 2.3 of the Short-Term Fee
Consignment Agreement), or (ii) any Bullion is returned to
the Consignor by the Consignee as not conforming with the
quality of gold or silver, as the case may be, as set forth
in Section 2.3.2 of the Short-Term Fee Consignment
Agreement, the Consignor shall make a mandatory repayment of
Advances in an amount equal to the Dollar Value of gold or
the Dollar Value of silver (or both, if applicable) that was
in effect on the Valuation Date corresponding to the
Consignment Period in respect of the gold or silver that was
lost or damaged prior to delivery to either Plant or that
was otherwise not in conformity with the quality required
pursuant to Section 2.3.2 of the Short-Term Fee Consignment
Agreement, as the case may be, together with interest which
shall be the several obligation of, and payable by, the
Consignor on the amount of such Advances at the rate
customarily charged for inter-bank loans in the U.S. for the
first two days such Advances were outstanding, and
thereafter for each day such Advances are outstanding at the
rate that would have accrued on such Advances as a Funding
Fee if such Bullion had not been lost, damaged or returned.
SECTION 3.2. Fees. Fees on the Advances shall accrue and
be payable in accordance with this Section 3.2 (and payment of
all such fees shall be subject to the provisions of Section
8.15).
SECTION 3.2.1. Funding Fee. To the extent that the
Consignor has first received the Consignment Fee from the
Consignee payable pursuant to Section 3.3.1 of the Short-Term Fee
Consignment Agreement in respect of other than Swing Line
Consignments, the Consignor agrees to pay to the Suppliers a
funding fee (the "Funding Fee") on each Advance at a rate equal
to the sum of the LIBO Rate (Reserve Adjusted) for the applicable
Funding Period plus a margin of 1/2 of 1% per annum; provided,
however, that if, as a result of the occurrence of any event
described in Section 4.2, Advances are maintained at the
Alternate Base Rate, then the Funding Fee payable by the
Consignor shall equal the rate which Scotiabank notifies the
Consignee, the Administrative Agent and the Suppliers is the rate
at which Dollar deposits in immediately available funds are
offered to it in an interbank market other than the London
interbank eurodollar market, as reasonably selected by
Scotiabank, including all basic, emergency, supplemental,
marginal and other reserves specified under regulations issued
from time to time by the F.R.S. Board and then applicable to
assets or liabilities of the nature selected by Scotiabank having
a term approximately equal or comparable to applicable Funding
Period (the "Substitute Rate"), plus a margin of 1/2 of 1% per
annum. If only a percentage of the total Consignment Fee is paid
to the Consignor under Section 3.3.1 of the Short-Term Fee
Consignment Agreement, then the Consignor agrees to pay over to
the Administrative Agent a Funding Fee in an amount equal to the
total amount of the Funding Fee otherwise due multiplied by the
percentage of the Consignment Fee so received by the Consignor
(but the Consignee's failure to pay the entire amount of the
Consignment Fee shall constitute an Event of Default, and the
acceptance of any partial payment of the Consignment Fee shall
not be deemed to be a waiver of, or otherwise release the
Consignee from complete performance of its Obligations under, the
Short-Term Fee Consignment Agreement).
The "LIBO Rate (Reserve Adjusted)" means, relative to any
Advance to be made, continued or maintained as, or converted
into, a LIBO Rate Advance for any Funding Period, a rate per
annum (rounded upwards, if necessary, to the nearest 1/16 of 1%)
determined pursuant to the following formula:
LIBO Rate = LIBO Rate
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Funding Period for
LIBO Rate Advances will be determined by the Administrative Agent
on the basis of the LIBOR Reserve Percentage in effect on, and
the applicable rates furnished to and received by the
Administrative Agent from Scotiabank two Business Days before,
the first day of such Funding Period.
"LIBO Rate" shall equal the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at
which Dollar deposits in immediately available funds are offered
to Scotiabank's LIBOR Office in the London interbank market as at
or about 11:00 a.m. (London time), two Business Days prior to the
beginning of such Funding Period for delivery on the first day of
such Funding Period, and in an amount approximately equal to the
amount of Scotiabank's LIBO Rate Advance, for a period
approximately equal to such Funding Period.
"LIBOR Reserve Percentage" means the reserve percentage
(expressed as a decimal) equal to the average maximum reserve
requirements of the Suppliers (without giving effect to the
branch or agency in which such Supplier funds such Advances)
(including all basic, emergency, supplemental, marginal and other
reserves and taking into account any transitional adjustments or
other scheduled changes in reserve requirements) specified under
regulations issued from time to time by the F.R.S. Board and then
applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D
of the F.R.S. Board, having a term approximately equal or
comparable to such Funding Period.
For so long as any Advances of a Supplier are maintained as
Base Rate Advances as a result of the occurrence of any event
described in Section 4.1 or 4.3, the Consignor shall (subject in
all respects to the terms of this Agreement) continue to pay such
Supplier the Funding Fee, at the LIBO Rate (Reserve Adjusted) for
the applicable Funding Period plus a margin of 1/2 of 1% per
annum, and to the extent (and only to the extent) that the
Consignor has first received from the Consignee all or a portion
of the fees payable pursuant to clause (b) of Section 3.3.1 of
the Short-Term Fee Consignment Agreement, the Consignor agrees to
also pay over (to the extent actually received) a fee to such
Supplier on such Advances at a rate equal to the positive
difference, if any, between (x) the Alternate Base Rate then in
effect and (y) the LIBO Rate (Reserve Adjusted) for the Funding
Period in respect of such Advances plus 1/2 of 1% per annum, with
all such amounts being due and payable on the dates the Funding
Fee is otherwise payable hereunder. For so long as any Advances
of the Suppliers are maintained as Base Rate Advances as a result
of the occurrence of any event described in Section 4.2, the
Consignor shall (subject in all respects to the terms of this
Agreement) continue to pay each Supplier the Funding Fee, at the
Substitute Rate for the applicable Funding Period plus a margin
of 1/2 of 1% per annum, and to the extent (and only to the
extent) that the Consignor has first received from the Consignee
all or a portion of the fees payable pursuant to clause (b) of
Section 3.3.1 of the Short-Term Fee Consignment Agreement, the
Consignor agrees to also pay over (to the extent actually
received) a fee to such Supplier on such Advances at a rate equal
to the positive difference, if any, between (x) the Alternate
Base Rate then in effect and (y) the Substitute Rate for the
Funding Period in respect of such Advances plus 1/2 of 1% per
annum, with all such amounts being due and payable on the dates
the Funding Fee is otherwise payable hereunder. The Funding Fee
shall accrue on all Advances from and including the first day of
the applicable Funding Period to (but not including) the last day
of such Funding Period. To the extent received, the Funding Fee
will be paid by the Consignor to the Administrative Agent for the
account of the Suppliers in arrears on (a) the Stated Maturity
Date, (b) on the last day of each Funding Period (or on each
three-month anniversary of a Funding Period, for Funding Periods
in excess of 3 months), and (c) on the date of any reduction in
the Advance Commitment Amount resulting from a reduction in the
Commitment Amount pursuant to Section 2.2.1 or 2.2.2 of the
Short-Term Fee Consignment Agreement, in an amount equal to any
accrued Funding Fee on that portion of the Commitment Amount
being reduced.
SECTION 3.2.2. Commitment Fees. To the extent (and only to
the extent) the Consignor first receives all or a portion of the
fees payable pursuant to Section 3.3.2 of the Short-Term Fee
Consignment Agreement, the Consignor agrees (subject to the terms
of this Agreement) to pay over (to the extent so received) to the
Administrative Agent, for the account of the Suppliers, a
commitment fee equal to 1/8 of 1% per annum multiplied by the
product of (a) the difference between (i) the average daily
number of ounces of gold or silver committed to be consigned
under the Short-Term Fee Consignment Agreement (based on the
Dollar Value of gold equalling $475 per ounce and the Dollar
Value of silver equalling $6.50 per ounce) during the relevant
period and (ii) the average daily number of ounces of gold or
silver, as the case may be, actually consigned under the Short-
Term Fee Consignment Agreement during the relevant period and
(b) $475 (in the case of gold) and $6.50 (in the case of silver)
in each case without giving effect to any Bullion consigned under
Swing Line Consignments. The commitment fee is payable in
arrears on each Quarterly Payment Date and on the Advance
Commitment Termination Date.
SECTION 3.2.3. Post-Maturity Rates. After the date any
amount (other than the Advances) payable by the Consignor shall
have become due and payable (or would become due and payable had
a corresponding payment been made by the Consignee) hereunder, in
each case as a result of a breach by the Consignee of its
obligations under any Fee Consignment Document, the Consignor
agrees, subject to the provisions of Section 8.15, to pay over to
the Administrative Agent any interest it receives from the
Consignee (after as well as before judgment) on such amounts at a
rate equal to the Alternate Base Rate plus a margin of 2% per
annum. In addition, to the extent that the Consignee fails to
return (or purchase) any Bullion on the dates and in the manner
required pursuant to the terms of the Short-Term Fee Consignment
Agreement, the Consignor agrees (subject to the terms hereof) to
the extent that it has first received the ABR Fee from the
Consignee payable pursuant to the second sentence of Section 3.2
of the Short-Term Fee Consignment Agreement that it shall pay to
the Suppliers on the date received instead of the Funding Fee an
amount equal to the Alternate Base Rate plus a margin of 2% per
annum on the principal amount of the Advances due but unpaid. If
only a percentage of the total ABR Fee is paid to the Consignor
pursuant to the second sentence of Section 3.2 of the Short-Term
Fee Consignment Agreement, then the Consignor agrees to pay over
to the Administrative Agent an amount equal to the Alternate Base
Rate plus a margin of 2% per annum on the principal amount of the
Advances due but unpaid multiplied by the percentage of such ABR
Fee so received by the Consignor (but the Consignee's failure to
pay the entire amount of such ABR Fee shall nevertheless
constitute an Event of Default, and the acceptance of any partial
payment of any such ABR Fee shall not be deemed to be a waiver
of, or otherwise release the Consignee from complete performance
of its Obligations under, the Short-Term Fee Consignment
Agreement).
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Supplier
shall determine (which determination shall, upon notice thereof
to the Administrative Agent (which notice the Administrative
Agent agrees it will as promptly as practicable forward to the
Consignor and the Consignee), absent manifest error, be prima
facie evidence of the facts stated therein) that the introduction
of or any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority
asserts that it is unlawful, for such Supplier to make, continue
or maintain any Advance as, or to convert any Advance into, a
LIBO Rate Advance, the obligations of such Supplier to make,
continue, maintain or convert any such Advances shall, upon such
determination, forthwith be suspended until such Supplier shall
notify the Administrative Agent that the circumstances causing
such suspension no longer exist (which notification such Supplier
agrees to give as promptly as practicable when such circumstances
no longer exist), and all LIBO Rate Advances of such Supplier
shall automatically convert into Base Rate Advances at the end of
the then current Funding Periods with respect thereto or sooner,
if required by such law or assertion. Upon any Advances being
made, continued or maintained as, or converted into, Base Rate
Advances by a Supplier (a) the Consignor shall (subject to the
terms of this Agreement) continue to pay a Funding Fee thereon at
a rate equal to the LIBO Rate (Reserve Adjusted) plus a margin of
1/2 of 1% per annum, and (b) the Consignor, to the extent (and
only to the extent) that the Consignor has first received the
fees payable pursuant to clause (b) of Section 3.3.1 of the
Short-Term Fee Consignment Agreement, agrees (subject to the
terms of this Agreement) to pay over to such Supplier on the
dates the Funding Fee is due and payable pursuant to Section
3.2.1 a fee on such Advances at a rate equal to the positive
difference, if any, between (x) the Alternate Base Rate from time
to time in effect and (y) the LIBO Rate (Reserve Adjusted) for
the Funding Period in respect of such Advances plus a margin of
1/2 of 1% per annum.
SECTION 4.2. Deposits Unavailable. If the Administrative
Agent shall have determined that
(a) Dollar deposits in the relevant amount and for the
relevant Funding Period are not available to Scotiabank in
its relevant market; or
(b) by reason of circumstances affecting Scotiabank or
the relevant market, adequate means do not exist for
ascertaining the rate applicable hereunder to LIBO Rate
Advances,
then, upon notice from the Administrative Agent to the Consignor,
the Consignee and the Suppliers, the obligations of all Suppliers
under Section 2.3 and Section 2.3.1 to make or continue any
Advances as, or to convert any Advances into, LIBO Rate Advances
shall forthwith be suspended until Scotiabank shall notify the
Consignor, the Consignee and the Suppliers that the circumstances
causing such suspension no longer exist, and such Advances shall
thereafter be maintained as Base Rate Advances. Upon any
Advances being maintained as Base Rate Advances pursuant to the
terms of this Section, (a) the Consignor shall (subject to the
terms of this Agreement) continue to pay a Funding Fee thereon at
the Substitute Rate plus a margin of 1/2 of 1% per annum, and (b)
the Consignor, to the extent (and only to the extent) that the
Consignor has first received the fees payable pursuant to clause
(b) Section 3.3.1 of the Short-Term Fee Consignment Agreement,
agrees to pay over to each Supplier on the dates the Funding Fee
is due and payable pursuant to Section 3.2.1 a fee on such
Advances at a rate equal to the positive difference, if any,
between (x) the Alternate Base Rate from time to time in effect
and (y) the Substitute Rate for the Funding Period in respect of
such Advances plus a margin of 1/2 of 1% per annum.
SECTION 4.3. Increased LIBO Rate Advance Costs, etc.
Subject to the terms of this Agreement, the Consignor agrees to
pay over to each Supplier (to the extent (and only to the extent)
first received by the Consignor) any increase in the cost to such
Supplier of, or any reduction in the amount of any sum receivable
by such Supplier in respect of, making, continuing or maintaining
(or of its obligation to make, continue or maintain) any Advances
as, or of converting (or of its obligation to convert) any
Advances into, LIBO Rate Advances. Such Supplier shall promptly
notify the Administrative Agent in writing of the occurrence of
any such event (which notice the Administrative Agent agrees it
will as promptly as practicable forward to the Consignor and the
Consignee), such notice to state, in reasonable detail, the
reasons therefor and the additional amount required fully to
compensate such Supplier for such increased cost or reduced
amount, and such notice shall, in the absence of manifest error,
be prima facie evidence of the matters stated therein. Subject
to the terms of this Agreement, such additional amounts shall be
paid over by the Consignor to such Supplier promptly, and in any
event within five days of the Consignor's receipt of a like
amount of such payment pursuant to Section 9.3 of the Short-Term
Fee Consignment Agreement. If increased costs are requested by
any Supplier (the "Affected Supplier") pursuant to this Section,
the Consignor may (and upon the instructions of the Consignee
shall), by telephonic notice (promptly confirmed in writing) to
the Administrative Agent (which shall give prompt notice thereof
to the Affected Supplier),
(a) as to any outstanding LIBO Rate Advances of such
Affected Supplier, be deemed to have prepaid such Advance in
full, without premium or penalty (other than as may be
provided in Section 4.4, and then only to the extent first
paid to the Consignor by the Consignee pursuant to Section
9.3 of the Short-Term Fee Consignment Agreement), and, to
the extent first paid to the Consignor by the Consignee
pursuant to Section 9.3 of the Short-Term Fee Consignment
Agreement, pay over to the Affected Supplier such increased
costs as well as any accrued Funding Fee, to the date of
such deemed prepayment on the principal amount prepaid,
without simultaneously making a prepayment of the Advances
of each other Supplier and simultaneously have each Advance
which is deemed prepaid accrue at the Alternate Base Rate in
an equal principal amount (without the necessity that the
conditions set forth in Section 5.2 are met); and
(b) with respect to any Advance Request or
Continuation Notice, request such Affected Supplier (i) to
make the applicable Advance then or thereafter subject to an
Advance Request as an Advance accruing at the Alternate Base
Rate, or (ii) to maintain the outstanding Base Rate Advance
or LIBO Rate Advance of such Supplier then or thereafter the
subject of a Continuation Notice as a Base Rate Advance;
provided, however, that in each case upon any Advance being
maintained as a Base Rate Advance pursuant to the terms of this
Section, (i) the Consignor shall (subject to the terms of this
Agreement) continue to pay a Funding Fee thereon at the LIBO Rate
(Reserve Adjusted) plus a margin of 1/2 of 1% per annum, and (ii)
the Consignor, to the extent (and only to the extent) the
Consignor has first received the fees payable pursuant to clause
(b) of Section 3.3.1 of the Short-Term Fee Consignment Agreement,
agrees to pay over to each Supplier maintaining its Advances as
Base Rate Advances on the dates the Funding Fee is due and
payable pursuant to Section 3.2.1 a fee on such Advances at a
rate equal to the positive difference, if any, between (x) the
Alternate Base Rate from time to time in effect and (y) the LIBO
Rate (Reserve Adjusted) for the Funding Period in respect of such
Advances plus a margin of 1/2 of 1% per annum.
SECTION 4.4. Funding Losses. In the event any Supplier
shall incur any loss or expense (including any loss or expense
incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by such Supplier to make, continue or
maintain any Advance as a LIBO Rate Advance, or to convert any
portion of the principal amount of any Advance into, a LIBO Rate
Advance) as a result of
(a) any repayment or prepayment of the principal
amount of any LIBO Rate Advances or any conversion of a LIBO
Rate Advance on a date other than the scheduled last day of
the Funding Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Advances (i) not being made as, or (ii) being
made as Advances other than as, LIBO Rate Advances in
accordance with the Advance Request; or
(c) any Advances not being continued as, or converted
into, LIBO Rate Advances in accordance with the Continuation
Notice therefor,
then, following the written notice of such Supplier to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Consignor and the Consignee) of the amount that will (in the
reasonable determination of such Supplier) reimburse such
Supplier for such loss or expense, the Consignor agrees, subject
to the terms of this Agreement, that it will promptly, and in any
event within five days of its receipt of such amount or any
portion thereof from the Consignee pursuant to Section 9.3 of the
Short-Term Fee Consignment Agreement, pay over to such Supplier
the amount so received. Such written notice (which shall include
calculations in reasonable detail) shall, in the absence of
manifest error, be prima facie evidence of the matters stated
therein.
SECTION 4.5. Increased Capital Costs. If any change in, or
the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any law or regulation,
directive, guideline, decision or request (whether or not having
the force of law) of any court, central bank, regulator or other
governmental authority affects or would affect the amount of
capital required or expected to be maintained by any Supplier or
any Person controlling such Supplier, and such Supplier
determines (in its sole and absolute discretion) that the rate of
return on its or such controlling Person's capital as a
consequence of its Advance Commitment or the Advances made by
such Supplier is reduced to a level below that which such
Supplier or such controlling Person could have achieved but for
the occurrence of any such circumstance, then, in any such case
upon notice from time to time by such Supplier to the
Administrative Agent (which notice the Administrative Agent
agrees it will as promptly as practicable forward to the
Consignor and the Consignee), the Consignor agrees, subject to
the terms of this Agreement, that it will promptly, and in any
event within five days of its receipt of a payment to compensate
such Supplier or such controlling Person for such reduction in
rate of return from the Consignee pursuant to Section 9.3 of the
Short-Term Fee Consignment Agreement, pay over to such Supplier
the amount actually received. A statement of such Supplier as to
any such additional amount or amounts (including calculations
thereof in reasonable detail) shall, in the absence of manifest
error, be prima facie evidence of the matters stated therein. In
determining such amount, such Supplier may use any method of
averaging and attribution that it (in its sole and absolute
discretion) shall deem applicable.
SECTION 4.6. Taxes. All payments made to the Suppliers and
the Administrative Agent hereunder shall be made free and clear
of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties,
withholdings or other charges of any nature whatsoever imposed by
any taxing authority, but excluding franchise taxes and taxes
imposed on or measured by any Supplier's net income or receipts
imposed by the jurisdiction of incorporation or organization of
such Supplier or the jurisdiction where such Supplier has its
Domestic Office or LIBOR Office (such non-excluded items being
called "Taxes"). In the event that any withholding or deduction
from any payment to be made hereunder is required in respect of
any Taxes pursuant to any applicable law, rule or regulation,
then, subject to the terms of this Agreement, the Consignor
agrees that it will pay over to the Administrative Agent for the
account of the Suppliers, such additional amount or amounts
actually received from the Consignee pursuant to Section 4.5 of
the Short-Term Fee Consignment Agreement as is necessary to
ensure that the net amount actually received by each Supplier
will equal the full amount such Supplier would have received had
no such withholding or deduction been required. Moreover, if the
Administrative Agent or any Supplier is obligated to pay any
Taxes with respect to any payment received by the Administrative
Agent or such Supplier hereunder, the Administrative Agent or
such Supplier may pay such Taxes and, subject to the terms of
this Agreement, the Consignor agrees that it will pay over to the
Administrative Agent such additional amounts to the extent
actually received from the Consignee pursuant to Section 4.5 of
the Short-Term Fee Consignment Agreement as is necessary in order
that the net amount received by such Person after the payment of
such Taxes (including any Taxes on such additional amount) shall
equal the amount such Person would have received had such Taxes
not been asserted. Upon the request of the Consignee, the
Consignor or the Administrative Agent, each Supplier that is
organized under the laws of a jurisdiction other than the United
States or a State thereof shall, prior to the due date of any
payments hereunder, execute and deliver to the Consignee, the
Consignor and the Administrative Agent, on or about the first
scheduled payment date in each Fiscal Year, one or more (as the
Consignee, the Consignor or the Administrative Agent may
reasonably request) United States Internal Revenue Service Forms
4224 or Forms 1001 or such other forms or documents (or successor
forms or documents), appropriately completed, as may be
applicable to establish the extent (if any) to which a payment to
such Supplier is exempt from withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless otherwise
expressly provided, all payments pursuant to this Agreement or
any other Advance Document shall be made in Dollars subject to
the terms of this Agreement (including Section 8.15) to the
Administrative Agent for the pro rata account of the Suppliers
entitled to receive such payment in accordance with their
respective Percentages. All such payments required to be made to
the Administrative Agent shall, to the extent first received by
the Consignor, be made, without setoff, deduction or
counterclaim, not later than 11:00 a.m. (New York City time), on
the date due, in immediately available funds, to such account as
the Administrative Agent shall specify from time to time by
notice. Funds received after that time shall be deemed to have
been received by the Administrative Agent on the next succeeding
Business Day. The Administrative Agent shall promptly remit in
same day funds to each Supplier its share, if any, of such
payments received by the Administrative Agent for the account of
such Supplier. All interest and fees shall be computed on the
basis of the actual number of days (including the first day but
excluding the last day) occurring during the period for which
such interest or fee is payable over a year comprised of 360 days
(or, in the case of interest on a Base Rate Advance, 365 days or,
if appropriate, 366 days). Whenever any payment to be made shall
otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (b) of the
definition of the term "Funding Period") be made on the next
succeeding Business Day and such extension of time shall be
included in computing interest and fees, if any, in connection
with such payment.
SECTION 4.8. Sharing of Payments. If any Supplier, in such
capacity, shall obtain any payment or other recovery (whether
voluntary, involuntary, by application of setoff or otherwise) on
account of any Advance (other than pursuant to the terms of
Sections 4.3, 4.4, 4.5, 4.6 and 8.3) in excess of its pro rata
share of payments then or therewith obtained by all Suppliers,
such Supplier shall purchase from the other Suppliers such
participation in Advances made by them as shall be necessary to
cause such purchasing Supplier to share the excess payment or
other recovery ratably with each of them; provided, however, that
if all or any portion of the excess payment or other recovery is
thereafter recovered from such purchasing Supplier, the purchase
shall be rescinded and each Supplier which has sold a
participation to the purchasing Supplier shall repay to the
purchasing Supplier the purchase price to the ratable extent of
such recovery together with an amount equal to such selling
Supplier's ratable share (according to the proportion of
(a) the amount of such selling Supplier's required
repayment to the purchasing Supplier
to
(b) the total amount so recovered from the purchasing
Supplier)
of any interest or other amount paid or payable by the purchasing
Supplier in respect of the total amount so recovered.
SECTION 4.9. Use of Proceeds. The Consignor shall apply
the proceeds of the Advances in connection with the consignment
of Bullion by the Consignor to the Consignee under the Short-Term
Fee Consignment Agreement. Without limiting the foregoing, the
Consignor agrees that on the date that each Advance (other than
pursuant to clause (a) of Section 2.3.1) is made, subject to
Article V of the Short-Term Fee Consignment Agreement, it will
effectuate or cause to occur a consignment of Bullion to a Plant
in the number of ounces equal to the applicable Dollar Value of
gold or Dollar Value of silver requested pursuant to the
corresponding Consignment Request as required by the Short-Term
Fee Consignment Agreement or, if such conditions are not
satisfied, immediately repay each such Advance made in respect
thereof (together with interest on the amount of such Advances at
the rate customarily charged for inter-bank loans in the U.S. for
the number of days such Advances were outstanding).
SECTION 4.10. Replacement of Suppliers. Each Supplier
hereby severally agrees that if such Supplier (a "Subject
Supplier") (a) makes a demand upon the Consignor for (or if the
Consignor or the Consignee is otherwise required to pay) amounts
as a result of the operation of Section 4.3, Section 4.5 or
Section 4.6, or (b) fails to fund any Advances it is required to
make (at a time when no Default has occurred and is continuing
and the applicable conditions set forth in Article V shall have
been satisfied) the Consignor may (and upon the instructions of
the Consignee shall),
(i) in the case of clause (a), within 90 days of
receipt by the Consignor of such demand (or the occurrence
of such other event causing the Consignor (subject to the
terms of this Agreement) or the Consignee to be required to
pay such compensation); and
(ii) within 10 Business Days following the failure of
such Subject Supplier to fund its Advance hereunder,
in each case give notice (a "Replacement Notice") in writing to
the Administrative Agent and such Supplier of its intention to
replace such Supplier with a financial institution selected by
the Consignor and the Consignee and designated in such
Replacement Notice. If the Administrative Agent shall, in the
exercise of its reasonable discretion and within 30 days of its
receipt of such Replacement Notice, notify the Consignee, the
Consignor and such Subject Supplier in writing that the
designated financial institution is satisfactory to the
Administrative Agent, then such Supplier shall, so long as no
Default shall have occurred and be continuing, assign, in
accordance with Section 8.11.1 (including the second proviso in
Section 8.11.1), inter alia all of its Advance Commitment,
Advances, and other rights and obligations under this Agreement
and all other Advance Documents to such designated financial
institution; provided, however, that (i) such assignment shall be
without recourse, representation or warranty and shall be on
terms and conditions reasonably satisfactory to such Supplier and
such designated financial institution and (ii) the purchase price
paid by such designated financial institution shall be in the
amount of such Supplier's Advances, together with all accrued and
unpaid interest and fees in respect thereof, plus all other
amounts (including the amounts demanded and unreimbursed under
Section 4.3, 4.5 or 4.6, as the case may be), owing to the
Subject Supplier hereunder. Upon the effective date of such
Assignment, such institution shall become a "Supplier" for all
purposes under this Agreement and the other Advance Documents.
The Administrative Agent agrees to use all commercially
reasonable efforts to assist in locating a replacement financial
institution to replace any Subject Supplier if the Consignee
shall have agreed in writing to pay all reasonable costs and
expenses (including the fee payable to the Administrative Agent
pursuant to Section 8.11.1) incurred by the Administrative Agent
in providing such assistance.
SECTION 4.11. Assignment to Administrative Agent. For good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Consignor hereby sells, transfers,
assigns and conveys to the Administrative Agent, for its benefit
and the benefit of the Suppliers (as defined in this Agreement
and the Dollar Supply Agreement), without representation,
warranty or recourse of any kind or nature, its rights, title and
interest in and to
(a) all Obligations (under and as defined in the Fee
Consignment Agreement and the Short-Term Fee Consignment
Agreement) of the Consignee owing to the Consignor under the
Fee Consignment Agreement and the Short-Term Fee Consignment
Agreement, to the extent such performance and/or payment
Obligations relate to the contingent obligation of the
Consignor to pay over to the Administrative Agent, for the
benefit of the Suppliers, any amounts hereunder or under the
Dollar Supply Agreement that are conditioned upon the
Consignor first receiving a like amount (or any amount, in
the case of a sale of Bullion to the Consignee) from the
Consignee, or are conditioned upon the Consignee returning
Bullion back to the Consignor pursuant to the terms of the
Fee Consignment Agreement and the Short-Term Fee Consignment
Agreement; and
(b) the security interest granted to the Consignor by
the Consignee pursuant to the terms of Section 4.2 of the
Fee Consignment Agreement and Section 4.2 of the Short-Term
Fee Consignment Agreement in the Collateral to secure the
performance and payment of all such Obligations (including
in connection with a Bullion Sale) of the Consignee
described above in clause (a).
In furtherance of the foregoing, the Consignor agrees to execute
such additional documents and perform such further acts as may be
reasonably requested by the Required Suppliers to carry out and
perform the foregoing provisions, including the filing of
financing statements (Form UCC-3) reflecting the assignment
effectuated by this Section, and agrees to comply with the
provisions of this Agreement, including the provisions of Section
6.2 and Section 6.3. The Suppliers acknowledge the intent of the
Consignor and the Consignee, as set forth in the Short-Term Fee
Consignment Agreement, is that the Short-Term Fee Consignment
Agreement and the transactions contemplated thereunder are a true
consignment, and not a consignment intended as security.
ARTICLE V
CONDITIONS TO ADVANCES
SECTION 5.1. Initial Advance. The obligations of the
Suppliers to fund the initial Advance on and after the Effective
Date shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Administrative Agent
shall have received from the Consignee a certificate, dated the
date of the initial Advance, of its Secretary or Assistant
Secretary as to
(a) resolutions of its Board of Directors then in full
force and effect authorizing the acknowledgment of this
Agreement;
(b) true and complete copies of the Consignee's
Organic Documents; and
(c) the incumbency and signatures of those of its
officers authorized to act with respect to this Agreement,
upon which certificate each Supplier may conclusively rely until
it shall have received a further certificate of the Secretary or
Assistant Secretary of the Consignee canceling or amending such
prior certificate.
SECTION 5.1.2. Revolving Credit Agreement and Short-Term
Fee Consignment Agreement Effectiveness. All of the conditions
set forth in Section 5.1 of the Revolving Credit Agreement and
Section 5.1 of the Short-Term Fee Consignment Agreement shall
have been satisfied (unless otherwise consented to by the
Suppliers) without waiver or modification and each of the
Revolving Credit Agreement and the Short-Term Fee Consignment
Agreement shall have become effective in accordance with their
terms.
SECTION 5.1.3. Opinions of Counsel. The Administrative
Agent shall have received
(a) copies of the opinions described in Section 5.1.4
of the Short-Term Fee Consignment Agreement, together with
reliance letters, dated the date of the initial Advance and
(in the case of other than the opinion described in
clause (e) of Section 5.1.4 of the Short-Term Fee
Consignment Agreement) addressed to the Administrative
Agent, the Co-Agents and all Suppliers (pursuant to which
the Consignee (or, in the case of the opinion to be
delivered by Bingham, Dana & Gould, the Consignor) shall
have expressly instructed the counsel to deliver such
opinions to the Administrative Agent and the Suppliers);
(b) an opinion of Kenneth E. Thorlakson, General
Counsel to the Consignor, substantially in the form of
Exhibit F hereto (and the Consignor hereby expressly
instructs such counsel to deliver such opinion to the
Suppliers); and
(c) an opinion of Mayer, Brown & Platt, New York,
counsel to the Consignor, substantially in the form of
Exhibit G hereto (and the Consignor hereby expressly
instructs such counsel to deliver such opinion to the
Suppliers).
SECTION 5.1.4. Closing Fees, Expenses, etc. The
Administrative Agent shall have received all fees, costs and
expenses due and payable pursuant to Section 8.3, if then
invoiced.
SECTION 5.2. All Advances. The obligation of each Supplier
to fund any Advance (including the initial Advance), other than
an Advance required to be made pursuant to clause (a) of
Section 2.3.1, shall be subject to the satisfaction of each of
the conditions precedent set forth in this Section 5.2.
SECTION 5.2.1. No Default, etc. Both before and after
giving effect to any such Advance the following statements shall
be true and correct
(a) after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(i) to all Suppliers shall not exceed the Advance
Commitment Amount; or
(ii) to such Supplier shall not exceed such
Supplier's Percentage multiplied by the Advance
Commitment Amount;
(b) the conditions to the consignment of Bullion set
forth in Article V of the Short-Term Fee Consignment
Agreement (other than as set forth in clause (f) of Section
5.2.1 thereof) shall have been satisfied; and
(c) no Default shall have then occurred and be
continuing.
SECTION 5.2.2. Advance Request. The Administrative Agent
shall have received an Advance Request from the Consignor for
such Advance.
SECTION 5.2.3. Satisfactory Legal Form. All documents
executed or submitted pursuant hereto in connection with such
Advance (other than Advance Requests and Continuation Notices)
shall be reasonably satisfactory in form and substance to the
Required Suppliers and, to the extent reasonably requested by the
Required Suppliers, the Suppliers shall have received all
information, approvals, opinions, documents or instruments as the
Required Suppliers may reasonably request; provided, that neither
the Administrative Agent nor the Consignor shall be under any
obligation to ascertain if any such information, approvals,
opinions, documents or instruments are required by any Supplier
prior to any Advance.
SECTION 5.2.4. No Consignor Bankruptcy Event. No Consignor
Bankruptcy Event shall have occurred.
SECTION 5.2.5. Advances Pursuant to Section 2.3.1. The
obligation of each Supplier to continue to fund any Advance
pursuant to clause (a) of Section 2.3.1 shall be subject to the
satisfaction of each of the following conditions precedent:
(a) after giving effect thereto, the aggregate
outstanding principal amount of all Advances owing
(i) to all Suppliers shall not exceed the Advance
Commitment Amount; or
(ii) to such Supplier shall not exceed such
Supplier's Percentage multiplied by the Advance
Commitment Amount;
(b) the Administrative Agent shall have received a
Continuation Notice from the Consignor for such Advance;
(c) no Consignor Bankruptcy Event shall have occurred;
and
(d) the conditions set forth in Section 5.2.3 (other
than in clause (d) thereof) of the Short-Term Fee
Consignment Agreement shall have been satisfied.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.1. Listing of Events of Default. Each of the
following events or occurrences described in this Section 6.1
shall constitute an "Event of Default".
SECTION 6.1.1. Breach of Warranty. Any representation or
warranty of the Consignee made or deemed to be made in any Fee
Consignment Document or any other writing or certificate
furnished by or on behalf of the Consignee to the Consignor for
the purposes of or in connection with any such Fee Consignment
Document (including any certificates delivered pursuant to
Article V of the Short-Term Fee Consignment Agreement) is or
shall be incorrect when made in any material respect.
SECTION 6.1.2. Default Under Material Agreements, etc. An
"Event of Default" under (and as defined in) the Fee Consignment
Agreement, the Short-Term Fee Consignment Agreement, the Dollar
Supply Agreement, the Revolving Credit Agreement or the Short
Term Revolving Credit Agreement shall have occurred and be
continuing.
SECTION 6.1.3. Bankruptcy, Insolvency, etc. The Consignee
or any of its Subsidiaries (including joint ventures) shall
(a) become insolvent or generally fail to pay, or
admit in writing its inability or unwillingness to pay,
debts as they become due;
(b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other
custodian for the Consignee or any of its Subsidiaries or
joint ventures (other than Non-Recourse Joint Ventures) or
any property of any thereof, or make a general assignment
for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for the
Consignee or any of its Subsidiaries or joint ventures
(other than Non-Recourse Joint Ventures) or for a
substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall not
be discharged within 60 days;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case
or proceeding under any bankruptcy or insolvency law, or any
dissolution, winding up or liquidation proceeding, in
respect of the Consignee or any of its Subsidiaries or joint
ventures (other than Non-Recourse Joint Ventures), and, if
any such case or proceeding is not commenced by the
Consignee or such Subsidiary or such joint venture, such
case or proceeding shall be consented to or acquiesced in by
the Consignee or such Subsidiary or such joint venture or
shall result in the entry of an order for relief or shall
remain for 60 days undismissed; or
(e) take any action authorizing, or in furtherance of,
any of the foregoing;
provided, that, the foregoing shall not apply to any Subsidiary
or joint venture of the Consignee, the value of whose assets in
the aggregate for the Fiscal Quarter (as defined in the Revolving
Credit Agreement) most recently ended accounted for an amount
equal to or less than 5% of Adjusted Consolidated Tangible Net
Worth (as defined in the Revolving Credit Agreement).
SECTION 6.2. Action if Bankruptcy. If any Event of Default
described in clauses (a) through (d) of Section 6.1.3 shall
occur, the Advance Commitment of each Supplier (if not
theretofore terminated) shall automatically terminate and the
Stated Maturity Date shall automatically be accelerated and, as
set forth in Section 8.2 of the Short-Term Fee Consignment
Agreement, the outstanding amount of all Obligations under each
Fee Consignment Document shall automatically be and become
immediately due and payable, and the Consignor agrees that it
shall require that all previously delivered Bullion then held by
the Consignee pursuant to the terms of the Short-Term Fee
Consignment Agreement shall be immediately returned to the
Consignor, in each case without notice or demand.
SECTION 6.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in
clauses (a) through (d) of Section 6.1.3) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required
Suppliers, shall by notice to the Consignor and the Consignee
declare the Advance Commitment of each Supplier (if not
theretofore terminated) to be terminated and/or the Stated
Maturity Date to be accelerated and/or direct the Consignor to
(i) declare all or any portion of the Obligations of the
Consignee under each Fee Consignment Document to be due and
payable, and/or (ii) require that all or any portion of
previously consigned Bullion then held by the Consignee pursuant
to the terms of the Short-Term Fee Consignment Agreement be
immediately returned to the Consignor, whereupon the full unpaid
amount of such Obligations of the Consignee which shall be so
declared due and payable shall be and become immediately due and
payable, without further notice, demand or presentment, the
Advance Commitments shall terminate and the Stated Maturity Date
shall be accelerated, and all such previously delivered Bullion
shall be immediately returned to the Consignor, in each case as
so directed by the Required Suppliers. Upon receipt of the
notice described in the first sentence of this Section, the
Consignor hereby agrees that it shall deliver a notice to the
Consignee that all Bullion then held by the Consignee pursuant to
the Short-Term Fee Consignment Agreement is to be immediately
returned to the Consignor and that all monetary Obligations of
the Consignee under the Short-Term Fee Consignment Agreement are
then due and payable, in accordance with Section 8.3 of the
Short-Term Fee Consignment Agreement. In addition, the Consignor
agrees that, if directed by the Required Suppliers, it will
deliver a notice to the Consignee of a default by the Consignee
of its Obligations under the Short-Term Fee Consignment
Agreement, as contemplated by Section 8.1.4 of the Short-Term Fee
Consignment Agreement.
SECTION 6.4. Consignor Bankruptcy Event. If any Consignor
Bankruptcy Event shall occur, the Advance Commitment of each
Supplier (if not therefore terminated) shall automatically
terminate and the Stated Maturity Date shall automatically be
accelerated, without notice or demand.
ARTICLE VII
THE AGENTS
SECTION 7.1. Actions. Each Supplier hereby appoints each
of Scotiabank, Chemical and BONY as its Co-Agent, and Scotiabank
as its Administrative Agent, under and for purposes of this
Agreement and each other Advance Document. Each Supplier
authorizes Scotiabank, in its capacity as the Administrative
Agent, to act on behalf of such Supplier under this Agreement and
each other Advance Document in such capacity and, in the absence
of other written instructions from the Required Suppliers
received from time to time by the Administrative Agent (with
respect to which the Administrative Agent agrees that it will
comply, except as otherwise provided in this Section or as
otherwise advised by counsel), to exercise such powers hereunder
and thereunder as are specifically delegated to or required of
the Administrative Agent by the terms hereof and thereof,
together with such powers as may be reasonably incidental
thereto. Each Supplier hereby indemnifies (which indemnity shall
survive any termination of this Agreement) the Administrative
Agent, pro rata according to such Supplier's Percentage, from and
against any and all liabilities, obligations, losses, damages,
claims, costs or expenses of any kind or nature whatsoever to the
extent not otherwise paid by the Consignee which may at any time
be imposed on, incurred by, or asserted against, the
Administrative Agent in any way relating to or arising out of
this Agreement and any other Advance Document, including
reasonable attorneys' fees, and as to which the Administrative
Agent is required to be, but is not reimbursed by the Consignee
or, to the extent received from the Consignee, the Consignor;
provided, however, that no Supplier shall be liable for the
payment of any portion of such liabilities, obligations, losses,
damages, claims, costs or expenses which are determined to have
resulted solely from the Administrative Agent's gross negligence
or wilful misconduct. The Administrative Agent shall not be
required to take any action hereunder or under any other Advance
Document except for such actions expressly provided for
hereunder, or to prosecute or defend any suit in respect of this
Agreement or any other Advance Document (including under Section
4.11) unless it is indemnified hereunder to its satisfaction. If
any indemnity in favor of the Administrative Agent shall be or
become, in the Administrative Agent's determination, inadequate,
the Administrative Agent may call for additional indemnification
from the Suppliers and cease to do the acts indemnified against
hereunder until such additional indemnity is given.
SECTION 7.2. Funding Reliance, etc. Unless the
Administrative Agent shall have been notified by telephone,
confirmed in writing, by any Supplier by 5:00 p.m. (New York City
time), on the day prior to an Advance that such Supplier will not
make available the amount which would constitute its Percentage
of such Advance on the date specified therefor, the
Administrative Agent may assume that such Supplier has made such
amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the Consignor a
corresponding amount. If and to the extent that such Supplier
shall not have made such amount available to the Administrative
Agent, such Supplier agrees to immediately advance to the
Administrative Agent on demand the corresponding amount together
with interest thereon, for each day from the date the
Administrative Agent made such amount available to the Consignor
to the date such amount is repaid to the Administrative Agent
(i) for the period from the date such funds were advanced to the
Consignor to (and including) three days thereafter, at the rate
customarily charged for inter-bank loans in the U.S. (and the
amount of interest that shall be returned to such Supplier in
respect of such days shall also equal the rate customarily
charged for inter-bank loans in the U.S.), and (ii) following
such third day, at the interest rate applicable at the time to
Advances comprising such Advance.
SECTION 7.3. Exculpation. Neither the Administrative
Agent, the Consignor (with respect to liabilities of the
Consignor arising under other than clause (e) of Section 3.1.3)
or any Co-Agent, nor any of their respective directors, officers,
employees or agents shall be liable to any Supplier for any
action taken or omitted to be taken by it under this Agreement or
any other Advance Document, or in connection herewith or
therewith, except for its own wilful misconduct or gross
negligence, nor responsible for any recitals or warranties herein
or therein, nor for the effectiveness, or, other than with
respect to such Administrative Agent, Consignor or Co-Agent,
enforceability, validity or due execution of this Agreement or
any other Advance Document (as it relates to such Person), nor to
make any inquiry respecting the performance by the Consignee of
its obligations hereunder or under any other Advance Document.
Any such inquiry which may be made by the Administrative Agent
shall not obligate it to make any further inquiry or to take any
action. The Administrative Agent and the Consignor shall be
entitled to rely upon advice of counsel concerning legal matters
and upon any notice, consent, certificate, statement or writing
which the Administrative Agent or the Consignor believes to be
genuine and to have been presented by a proper Person.
SECTION 7.4. Successor. The Administrative Agent may, with
the consent of all the Suppliers, resign as such at any time upon
at least 30 days' prior notice to the Consignor, the Consignee
and all Suppliers. If the Administrative Agent at any time shall
resign, the Required Suppliers may, with the written consent of
the Consignee so long as no Default has occurred and is
continuing (which consent shall not be unreasonably withheld),
appoint another Supplier as a successor Administrative Agent,
which shall thereupon (subject to its consent) become the
Administrative Agent hereunder. If no successor Administrative
Agent shall have been so appointed by the Required Suppliers, and
shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the
Suppliers, appoint a successor Administrative Agent, which shall
(subject to its consent) be one of the Suppliers or a commercial
banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking
institution, and having a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to
receive from the retiring Administrative Agent such documents of
transfer and assignment as such successor Administrative Agent
may reasonably request, and shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's
resignation hereunder as the Administrative Agent, the provisions
of
(a) this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was
the Administrative Agent under this Agreement; and
(b) Section 8.3 and Section 8.4 shall continue to
inure to its benefit.
SECTION 7.5. Advances by an Agent. Each Agent shall have
the same rights and powers with respect to the Advances made by
it or any of its respective Affiliates as any other Supplier and
may exercise the same as if it were not an Agent. Each Agent and
its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with the Consignee or
any Subsidiary or Affiliate of the Consignee as if such Agent, as
the case may be, were not an Agent hereunder.
SECTION 7.6. Credit Decisions. Each Supplier acknowledges
that it has, independently of the Consignor, the Administrative
Agent, each Co-Agent and each other Supplier, and based on such
Supplier's review of the financial information of the Consignee,
this Agreement, the other Advance Documents (the terms and
provisions of which being satisfactory to such Supplier) and such
other documents, information and investigations as such Supplier
has deemed appropriate, made its own credit decision to extend
its Advance Commitment. Each Supplier also acknowledges that it
will, independently of the Consignor, the Administrative Agent,
each Co-Agent and each other Supplier, and based on such other
documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time
any rights and privileges available to it under this Agreement or
any other Advance Document.
SECTION 7.7. Copies, etc. The Administrative Agent shall
give prompt notice to each Supplier of each notice or request
required or permitted to be given to the Administrative Agent by
the Consignor and the Consignee pursuant to the terms of this
Agreement (unless concurrently delivered to the Suppliers by the
Consignor or the Consignee). The Administrative Agent will
distribute to each Supplier each document or instrument received
for its account and copies of all other communications received
by the Administrative Agent from the Consignor and the Consignee
for distribution to the Suppliers by the Administrative Agent in
accordance with the terms of this Agreement.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1. Waivers, Amendments, etc. The provisions of
this Agreement and of each other Advance Document may from time
to time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to by the
Required Suppliers and the Consignee, provided, however, that no
such amendment, modification or waiver to this Agreement; and the
Consignor shall not consent to any amendment, modification or
waiver to any Fee Consignment Document, which would:
(a) modify any requirement hereunder that any
particular action be taken by all the Suppliers or by the
Required Suppliers shall be effective unless consented to by
each Supplier;
(b) modify this Section 8.1 or Section 4.2 (or any
defined terms contained therein), the last sentence of
Section 9.10, Sections 9.3, 9.4 or 9.13 of the Short-Term
Fee Consignment Agreement, change the definition of
"Required Suppliers", increase the Advance Commitment Amount
or the Percentage of any Supplier, release any collateral
security (it being acknowledged and agreed by the parties
hereto that the use of Bullion by the Consignee in the
production and fabrication of products for its customers or
the sale thereof to its customers (to the extent such
Bullion has been purchased pursuant to the terms of the
Short-Term Fee Consignment Agreement or other gold and/or
silver (as applicable) has been returned to the Consignor
pursuant to the terms of the Short-Term Fee Consignment
Agreement) shall not be deemed to be a release of collateral
security), or (except as set forth in Section 2.4.2) extend
the Advance Commitment Termination Date shall be made
without the consent of each Supplier (and the Consignor
agrees that it will not consent to any such amendment,
waiver or other modification to the Short-Term Fee
Consignment Agreement unless each Supplier (or in the case
of Section 9.3 of the Short-Term Fee Consignment Agreement,
each affected Supplier) has first so consented);
(c) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of
principal of or fee in respect of any Advance or any other
amounts to a Supplier hereunder (or reduce the principal
amount of or rate of any fee or interest on any Advance)
shall be made without the consent of each affected Supplier;
(d) affect adversely the interests, rights or
obligations of (i) an Agent qua such Agent or (ii) the
Consignor, shall be made without consent of such Agent or
the Consignor, as applicable;
(e) amend, waive or otherwise modify (i) the
definition of "Bullion", "gold" or "silver", Sections 2.3,
2.3.3, 7.2.2 or 9.1 of the Short-Term Fee Consignment
Agreement, (ii) any representation or warranty made by the
Consignee in Article VI of the Short-Term Fee Consignment
Agreement (including those incorporated by reference in
Section 6.1 thereof), any covenant made by the Consignee in
Article VII of the Short-Term Fee Consignment Agreement
(including those incorporated by reference in Section 7.1
thereof), or any Event of Default (under and as defined in
the Short-Term Fee Consignment Agreement), or (iii) any
condition to the consignment of Bullion contained in Article
V of the Short-Term Fee Consignment Agreement, shall be
consented to by the Consignor unless first consented to by
the Required Suppliers (and the Consignor agrees that it
will not consent to any such amendment, waiver or other
modification to the Short-Term Fee Consignment Agreement
unless the Required Suppliers have first so consented); or
(f) extend the due date for, or reduce the amount of,
any scheduled or mandatory repayment or prepayment of (or
reduce the rate of) any fee, interest or other amounts
payable under the Short-Term Fee Consignment Agreement shall
be made without the consent of each affected Supplier (and
the Consignor agrees that it will not consent to any such
extensions or reductions unless each affected Supplier has
first so consented).
No failure or delay on the part of any Agent, any Supplier or the
Consignor in exercising any power or right under this Agreement
or any other Advance Document shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power or
right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on
the Consignor or the Consignee in any case shall entitle it to
any notice or demand in similar or other circumstances. No
waiver or approval by any Agent, any Supplier or the Consignor
under this Agreement or any other Advance Document shall, except
as may be otherwise stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
SECTION 8.2. Notices. All notices and other communications
provided to any party hereto or the Consignee under this
Agreement or any other Advance Document shall be in writing or by
facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth below its signature
hereto (or, in the case of the Consignee, at its address or
facsimile number set forth in the Short-Term Fee Consignment
Agreement) or set forth in the Supplier Assignment Agreement or
at such other address or facsimile number as may be designated by
such party or the Consignee, as applicable, in a notice to the
other parties. Any notice, if mailed and properly addressed with
postage prepaid or if properly addressed and sent by pre-paid
courier service, shall be deemed given when received; any notice,
if transmitted by facsimile, shall be deemed given when
transmitted upon receipt of electronic confirmation of
transmission.
SECTION 8.3. Payment of Costs and Expenses. Subject to the
terms of this Agreement, the Consignor agrees to pay over to the
Administrative Agent all reasonable out-of-pocket expenses of the
Administrative Agent (including the fees and out-of-pocket
expenses of a single counsel to the Administrative Agent and of
local counsel, if any, who may be retained by counsel to the
Administrative Agent) received by it from the Consignee pursuant
to Section 9.3 of the Short-Term Fee Consignment Agreement in
connection with
(a) the negotiation, preparation, execution and
delivery and (where applicable), filing and recording of
this Agreement and of each other Advance Document, including
schedules and exhibits, and any amendments, waivers,
consents, supplements or other modifications to this
Agreement or any other Advance Document as may from time to
time hereafter be required, whether or not the transactions
contemplated hereby are consummated;
(b) the preparation and review of the form of any
document or instrument relevant to this Agreement or any
other Advance Document; and
(c) the administration and monitoring of this
Agreement and the Advance Documents, and compliance of the
parties hereto with respect to the terms hereof.
Subject to the terms of this Agreement, the Consignor further
agrees to pay over to the Administrative Agent amounts actually
received from the Consignee pursuant to Section 9.3 of the Short-
Term Fee Consignment Agreement in respect of any stamp or other
taxes which may be payable in connection with the execution or
delivery of this Agreement, the Advances hereunder or any other
Advance Documents (provided, that each Supplier agrees if any
Taxes are paid by the Consignor or the Administrative Agent on
behalf of any Supplier to any governmental authority and such
Taxes are not paid over by the Consignee to the Consignor or the
Administrative Agent, as the case may be, as required pursuant to
Section 4.5 of the Short-Term Fee Consignment Agreement, then
such Supplier shall, promptly following demand by the Consignor
or the Administrative Agent, as applicable, pay to the Consignor
or the Administrative Agent the full amount of such Taxes).
Subject to the terms of this Agreement, the Consignor also agrees
to pay over to the Administrative Agent (to the extent (and only
to the extent) first received by the Consignor from the
Consignee) for the account of the relevant Supplier amounts in
respect of reasonable out-of-pocket expenses (including
attorneys' fees and legal expenses (including those fees and
legal expenses of internal counsel to such Supplier allocated to
this Agreement)) incurred by such Agent, or such Supplier in
connection with (x) the negotiation of any restructuring or
"work-out", whether or not consummated, of any Obligations and
(y) the enforcement of any Obligations.
SECTION 8.4. Turn-Over of Certain Payments. Subject to the
terms of this Agreement, the Consignor hereby agrees to pay over
to the Administrative Agent, to the extent (and only to the
extent) first received by the Consignor from the Consignee under
Sections 9.3 and 9.14 of the Short-Term Fee Consignment
Agreement, costs and expenses arising in connection with any and
all actions, causes of action, suits, losses (other than the
principal amount of the Advances), costs, liabilities and
damages, and expenses incurred by the Agents or the Suppliers and
each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") in connection
with the execution and delivery of this Agreement by the Agents
and each Supplier and the extension of the Advance Commitment
(irrespective of whether any such Indemnified Party is a party to
such action), including reasonable attorneys' fees and
disbursements (collectively, the "Indemnified Liabilities"),
incurred by the Indemnified Parties or any of them as a result
of, or arising out of, or relating to
(a) any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds
of any Advance;
(b) any breach by the Consignee of its Obligations
under (and as defined in) the Short-Term Fee Consignment
Agreement;
(c) any investigation, litigation or proceeding
involving the Consignee or any of its Subsidiaries or
property now or previously owned or leased by the Consignee
or any of its Subsidiaries related to any environmental
cleanup, compliance or other similar matter relating to the
protection of the environment by the Consignee or any of its
Subsidiaries or the Release by the Consignee or any of its
Subsidiaries of any Hazardous Material; provided, that the
Indemnified Party shall have given the Consignee notice of
any such matter and an opportunity to participate in, but
not (except at the sole discretion of the Indemnified
Parties) to manage or control, the defense or settlement of
any such matters which may give rise to any Indemnified
Liabilities;
(d) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or
releasing from, any real property owned or operated by the
Consignee or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused
by, or within the control of, the Consignee or such
Subsidiary; or
(e) any breach of warranty contained in Section 6.12
of the Short Term Revolving Credit Agreement (as
incorporated by reference pursuant to Section 6.1 of the
Short-Term Fee Consignment Agreement), without giving effect
to the exceptions based upon the materially adverse effect
and any qualification based on materiality or knowledge;
except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of the
relevant Indemnified Party's gross negligence or wilful
misconduct.
SECTION 8.5. Survival. Subject to the terms of this
Agreement, the obligations of the Consignor under Article IV,
Section 8.3 and Section 8.4, the obligations of the Suppliers
under Section 7.1, and the provisions of Section 8.15 (including
the obligations of the parties hereto pursuant to such Section)
shall, in each case survive any termination of this Agreement,
the payment in full of all Obligations and the termination of the
Advance Commitment.
SECTION 8.6. Severability. Any provision of this Agreement
or any other Advance Document which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or such Advance Document
or affecting the validity or enforceability of such provision in
any other jurisdiction.
SECTION 8.7. Headings. The various headings of this
Agreement and of each other Advance Document are inserted for
convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Advance Document
or any provisions hereof or thereof.
SECTION 8.8. Execution in Counterparts, Effectiveness, etc.
This Agreement may be executed by the parties hereto in several
counterparts, each of which shall be executed by the Consignor
and the Administrative Agent and be deemed to be an original and
all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Consignor, each
Agent and each Supplier, and acknowledged by the Consignee (or
notice thereof satisfactory to the Administrative Agent) shall
have been received by the Administrative Agent and notice thereof
shall have been given by the Administrative Agent to the
Consignee and each Supplier.
SECTION 8.9. Governing Law; Entire Agreement. THIS
AGREEMENT AND EACH OTHER ADVANCE DOCUMENT SHALL EACH BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK. This Agreement and the other Advance
Documents constitute the entire understanding among the parties
hereto with respect to the subject matter hereof and supersede
any prior agreements, written or oral, with respect thereto.
SECTION 8.10. Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns; provided,
however, that:
(a) the Consignor (i) may not assign or transfer its
rights or obligations hereunder or (except as set forth in
Section 4.11) under the Short-Term Fee Consignment Agreement
and (ii) agrees that it will not consent to the Consignee
assigning or transferring any of its rights or obligations
under the Fee Consignment Agreement, in each case without
the prior written consent of all Suppliers; and
(b) the rights of sale, assignment and transfer of the
Suppliers are subject to Section 8.11;
provided, that, the parties hereto acknowledge and agree that the
Consignee is a third party beneficiary of clauses (b) and (c) of
Section 2.4.2, Sections 4.1 through 4.6 (inclusive), 4.10, 7.4,
8.1, 8.2 and 8.11, to the extent such clauses and Sections
expressly provide the Consignee with rights or benefits
thereunder, and, to the extent of the delivery requirements of
the Consignor thereunder, Sections 2.3, 2.3.1 and 3.2.1.
SECTION 8.11. Sale and Transfer of Advances; Participation
in Advances. Each Supplier may assign, or sell participation in,
its Advances and Advance Commitment to one or more other Persons
in accordance with this Section 8.11.
SECTION 8.11.1. Assignments. Any Supplier,
(a) with the written consent of the Consignor
(provided, that the Consignee shall have also consented to
such Assignee Lender pursuant to Section 10.11.1 of the
Revolving Credit Agreement, which consents shall not be
unreasonably delayed or withheld and which consent, in the
case of the Consignee, shall be deemed to have been given in
the absence of a written notice delivered by the Consignee
to the Administrative Agent, on or before the fifth Business
Day after receipt by the Consignee of such Supplier's
request for consent, stating, in reasonable detail, the
reasons why the Consignee proposes to withhold such consent)
may at any time assign and delegate to one or more
commercial banks or other financial institutions;
(b) with notice to the Consignee and the
Administrative Agent, but without the consent of any Person,
may (i) assign and delegate to any other Supplier, and (ii)
assign and/or delegate to any of its Affiliates or
Subsidiaries; and
(c) with notice to the Administrative Agent, but
without the consent of any Person, may pledge its Advances
(and related rights thereto) to a Federal Reserve Bank in
support of borrowings made by such Supplier from such
Federal Reserve Bank;
(each Person described in the foregoing clauses as being the
Person to whom such assignment and delegation is to be made,
being hereinafter referred to as an "Assignee Supplier"), all or
any fraction of such Supplier's total Advances and Advance
Commitment (which assignment and delegation shall be of a
constant, and not a varying, percentage of all the assigning
Supplier's Advances and Advance Commitment) in a minimum
aggregate amount, when taken together with other assignments
being made to such Assignee Supplier under the Revolving Credit
Agreement, the Short Term Revolving Credit Agreement and the
Short-Term Dollar Supply Agreement, of $10,000,000 in the case of
an assignment described in clause (a) (such amount to be reduced
pro rata by any permanent reductions in the amount of the Advance
Commitment), or if less, all of such Supplier's Advances and
Advance Commitment; provided, however, that any such Supplier
will (i) except in connection with a pledge of Advances pursuant
to clause(c) above, contemporaneously sell a pro rata portion of
its (A) Advances and Advance Commitment (as such terms are
defined in the Dollar Supply Agreement), (B) Loans and Commitment
(as such terms are defined in the Revolving Credit Agreement) and
(C) its Loans and Commitment (as such terms are defined in the
Short Term Revolving Credit Agreement), in each case to the same
Assignee Supplier pursuant to the terms of such agreements, and
(ii) comply, if applicable, with the provisions contained in the
last sentence of Section 4.6 and further, provided, however,
that, the Consignee, the Consignor and the Administrative Agent
shall be entitled to continue to deal solely and directly with
such Supplier in connection with the interests so assigned and
delegated to an Assignee Supplier until
(d) written notice of such assignment and delegation,
together with payment instructions, addresses and related
information with respect to such Assignee Supplier, shall
have been given to the Consignee and the Administrative
Agent by such Supplier and such Assignee Supplier;
(e) such Assignee Supplier shall have executed and
delivered to the Consignee and the Administrative Agent a
Supplier Assignment Agreement, accepted by the
Administrative Agent and acknowledged by the Consignee; and
(f) the processing fees described below shall have
been paid.
From and after the date that the Administrative Agent accepts
such Supplier Assignment Agreement, (x) the Assignee Supplier
thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder
have been assigned and delegated to such Assignee Supplier in
connection with such Supplier Assignment Agreement, shall have
the rights and obligations of a Supplier hereunder and under the
other Advance Documents, and (y) the assignor Supplier, to the
extent that rights and obligations hereunder have been assigned
and delegated by it in connection with such Supplier Assignment
Agreement, shall be released from its obligations hereunder and
under the other Advance Documents. Accrued interest and fees on
that part of the assigned Advances and Advance Commitment shall
be paid, as provided in the Supplier Assignment Agreement.
Subject to the terms hereof, accrued interest and accrued fees
shall be paid by the Consignor at the same time or times provided
in this Agreement. Such assignor Supplier or such Assignee
Supplier must also pay (without duplication of any processing
fees payable pursuant to Section 10.11.1 of the Revolving Credit
Agreement, Section 10.11.1 of the Short Term Revolving Credit
Agreement and Section 8.11.1 of the Dollar Supply Agreement) a
processing fee to the Administrative Agent upon delivery of any
Supplier Assignment Agreement in the amount of $2,500 (provided,
however, that such processing fee shall not be required to be
paid by a Supplier in the case of (i) an assignment and/or
delegation of such Supplier's Advances and Advance Commitment to
an Affiliate or Subsidiary of such Supplier, or (ii) to a Federal
Reserve Bank pursuant to clause (c) of this Section). Any
attempted assignment and delegation not made in accordance with
this Section 8.11.1 shall be null and void.
SECTION 8.11.2. Participation. Any Supplier may at any
time sell to one or more commercial banks or other Persons (each
of such commercial banks and other Persons being herein called a
"Participant") participating interests in any of the Advances,
its Advance Commitment, or other interests of such Supplier
hereunder; provided, however, that
(a) no participation contemplated in this
Section 8.11.2 shall relieve such Supplier from its Advance
Commitment or its other obligations hereunder or under any
other Advance Document;
(b) such Supplier shall remain solely responsible for
the performance of its Advance Commitment and such other
obligations;
(c) the Consignee, the Consignor and the
Administrative Agent shall continue to deal solely and
directly with such Supplier in connection with such
Supplier's rights and obligations under this Agreement and
each of the other Advance Documents;
(d) no Participant, unless such Participant is an
Affiliate of such Supplier, or is itself a Supplier, shall
be entitled to require such Supplier to take or refrain from
taking any action hereunder or under any other Advance
Document, except that such Supplier may agree with any
Participant that such Supplier will not, without such
Participant's consent, take any actions of the type
described in clause (b), (c) or (f) of Section 8.1; and
(e) neither the Consignor nor the Consignee shall be
required to pay any amount hereunder or under the Short-Term
Fee Consignment Agreement that is greater than the amount
which it would have been required to pay had no
participating interest been sold.
Subject to the terms of this Agreement, the Consignor
acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 8.3 and 8.4, shall be
considered a Supplier.
SECTION 8.12. Other Transactions. Nothing contained herein
shall preclude any Agent or any other Supplier from engaging in
any transaction, in addition to those contemplated by this
Agreement or any other Advance Document, with the Consignee or
any of its Affiliates in which the Consignee or such Affiliate is
not restricted hereby from engaging with any other Person.
SECTION 8.13. Forum Selection and Consent to Jurisdiction.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER ADVANCE DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
ORAL OR WRITTEN) OR ACTIONS OF EACH AGENT, THE CONSIGNOR OR THE
SUPPLIERS SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE CITY AND STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL
OR OTHER PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT'S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL
OR OTHER PROPERTY MAY BE FOUND. THE SUPPLIERS, THE AGENTS AND
THE CONSIGNOR HEREBY EXPRESSLY AND IRREVOCABLY FOR ITSELF AND ITS
PROPERTY SUBMIT TO THE JURISDICTION OF THE COURTS OF THE CITY AND
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION.
SECTION 8.14. Waiver of Jury Trial. EACH AGENT, THE
CONSIGNOR AND THE SUPPLIERS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER ADVANCE
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF SUCH AGENT, THE CONSIGNOR
OR THE SUPPLIERS. THE AGENTS, THE SUPPLIERS AND THE CONSIGNOR
ACKNOWLEDGE AND AGREE THAT EACH HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER ADVANCE DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR EACH OTHER PARTY HERETO
ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER ADVANCE
DOCUMENT.
SECTION 8.15. No Recourse. Each of the parties acknowledge
and agree that the Consignor shall in no event be (or be deemed
to be) a guarantor, surety or obligor of any of the monetary or
other Obligations (when used in this Section, such term to mean
and include the Obligations under (and as defined in) the Fee
Consignment Agreement and the Short-Term Fee Consignment
Agreement) of the Consignee, and shall under no circumstances be
liable for any of the Obligations of the Consignee. In
furtherance of the foregoing, and notwithstanding any provisions
herein or in any of the other Advance Documents or Fee
Consignment Documents to the contrary (other than the last
sentence of this Section),
(a) in the event that the Administrative Agent, acting
at the direction of the Required Suppliers, shall at any
time take action to enforce the collection of the
Obligations, the Suppliers shall in no event have recourse
against the Consignor or any of its assets (and the
Suppliers acknowledge and agree that the Obligations are not
(nor shall they be deemed to be) obligations owing by the
Consignor; and
(b) the Consignor shall only be required to pay over
all or any portion of the amounts due under Sections 2.2,
2.4.2, Article III (other than clauses (a) and (e) of
Section 3.1.3), Article IV, Section 6.2, Section 6.3,
Section 8.3 and Section 8.4 (or any other amounts hereunder
to the extent such payment is expressly made contingent on
the Consignor first receiving such amount from the
Consignee) to the extent (and only to the extent) that the
Consignor first receives payment (in whole or in part as
applicable) with respect thereto in immediately available
funds from the Consignee or (in the case of a repayment or
prepayment of the Advances), the Consignee has first
returned to (or purchased from) the Consignor all or a
portion of the Bullion in respect of such Advances in each
case pursuant to the terms of the Fee Consignment Agreement
and Short-Term Fee Consignment Agreement.
Each of the Suppliers acknowledge and agree that if at any time
any payment made by the Consignor to a Supplier in respect of any
Obligations is subsequently rescinded, recovered from or repaid
by the Consignor for any reason other than to the extent of the
Consignor's gross negligence or wilful misconduct (including as
the result of any bankruptcy, dissolution, reorganization or
liquidation proceedings (or proceedings similar thereto) relating
to the Consignee), then each such Supplier shall repay to the
Consignor on demand that portion received by it of the amount so
rescinded, recovered from or repaid by the Consignor. Nothing in
this Section shall adversely affect any rights of any Suppliers
(when used in this Section, such term to mean and include all
Suppliers, under and as defined in this Agreement and the Dollar
Supply Agreement) (i) to assert any claims against the Consignor
to the extent that the Consignor has actually received from the
Consignee all or any portion of the monetary amounts that the
Consignor is required to pay over to the Suppliers hereunder or
under the Dollar Supply Agreement or has actually received all or
any portion of Bullion (when used in this Section, such term to
mean all Bullion, as defined in the Fee Consignment Agreement and
the Short-Term Fee Consignment Agreement) that is required to be
returned to the Consignor under the terms of the Fee Consignment
Agreement or the Short-Term Fee Consignment Agreement (or has
actually received, in lieu of a return of Bullion, Dollars to the
extent any such Bullion is purchased by the Consignee pursuant to
the terms of the Fee Consignment Agreement or the Short-Term Fee
Consignment Agreement), and notwithstanding such actual receipt
of monetary amounts or Bullion (as the case may be), the
Consignor has failed to repay to the Suppliers any amount owing
to them under the terms hereof, under the Short-Term Dollar
Supply Agreement or under the Suppliers' Agreement, to the extent
then due and payable, or (ii) to direct the Consignor to
accelerate the Obligations and require the immediate return of
Bullion to the Consignor, as set forth in Sections 6.2 and 6.3 of
this Agreement and Sections 6.2 and 6.3 of the Dollar Supply
Agreement. The Consignor agrees to indemnify and hold harmless
the Indemnified Parties from and against all actions, causes of
action and suits, and losses, costs, liabilities and actual (but
in no event consequential or punitive) damages hereunder arising
(i) by reason of a Consignor Bankruptcy Event, (ii) to the extent
and only to the extent from the gross negligence or wilful
misconduct of the Consignor (in its capacity as Consignor) or
(iii) from a breach hereunder or under the Short-Term Fee
Consignment Agreement by the Consignor (in such capacity) at a
time when no Event of Default has occurred and is continuing.
SECTION 8.16. Waiver of Immunity; Judgment Currency.
(a) To the extent that the Consignor may have any immunity
on the grounds of sovereignty or otherwise from jurisdiction of
any court in the United States or from any legal process (whether
through service or notice, attachment prior to judgment,
attachment in aid of execution or otherwise) or from any legal
proceeding with respect to itself or its property, the Consignor
hereby irrevocably waives such immunity for itself and its
property (including, without limitation, property held by the
Consignor for its own account) with respect to its obligations
under this Agreement and the Suppliers' Agreement.
(b) If for the purpose of obtaining judgment in any court
it is necessary to calculate the equivalent of a sum due from the
Consignor under this Agreement which is denominated in Dollars in
another currency, the rate of exchange used shall be that at
which in accordance with normal banking procedures the Supplier
seeking such judgment could purchase Dollars with such other
currency on the Currency Business Day (defined below) preceding
that on which judgment is given. Notwithstanding any such
judgment in such other currency, the obligations of the Consignor
with respect to such sum due from it to the applicable Supplier
hereunder shall be discharged only to the extent that on the
Currency Business Day following receipt by such Supplier of such
amount adjudged to be so due in such other currency, such
Supplier, in accordance with normal banking procedures, can
purchase Dollars with such currency. If the Dollars so purchased
are less than the sum originally due to the applicable Supplier
in Dollars, the Consignor agrees as a separate obligation and
notwithstanding any such judgment to indemnify such Supplier
against such loss (other than any loss caused by such Supplier's
gross negligence and wilful misconduct) and to promptly pay to
such Supplier an amount such that such Supplier receives the full
sum originally due to such Supplier in Dollars; and if the
Dollars so purchased exceed such sum originally due to such
Supplier in Dollars, such Supplier agrees to remit such excess to
the Consignor. "Currency Business Day" means any day other than
a Saturday, Sunday or relevant holiday on which dealings in such
other currency and Dollars are carried out in the New York
interbank market and through official agencies of the country
where such other currency is available for purchase with Dollars.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.
THE BANK OF NOVA SCOTIA,
in its capacity as Consignor
By: /s/ Stephen Lockhart
Title: Senior Manager
Address: One Liberty Plaza
New York, N.Y. 10006
Facsimile No: 212-225-5090
Attention: Mr. Brian Allen
With a copy to:
Address: The Bank of Nova Scotia
44 King Street West
Toronto, Ontario
Canada M5H 1H1
Facsimile No: 416-866-4053
Attention: Mr. Peter Payne
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent and Co-Agent
By: /s/ Stephen Lochart
Title: Senior Manager
Address: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5090
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NOVA SCOTIA, in its capacity
as a Supplier
By: /s/ Stephen Lockhart
Name: Stephen Lockhart
Title: Senior Manager
Domestic
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
LIBOR
Office: One Liberty Plaza
New York, New York 10006
Facsimile No.: 212-225-5091
Attention: Mr. Brian Allen
PERCENTAGE
8.641975300% THE BANK OF NEW YORK, in its capacity as
a Co-Agent and a Supplier
By: /s/ William A. Kerr
Name: William A. Kerr
Title: Vice President
Domestic
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
LIBOR
Office: One Wall Street
New York, New York 10286
Facsimile No.: 212-635-1480
Attention: Wendy Forrest
PERCENTAGE
8.641975300% CHEMICAL BANK, in its capacity as
a Co-Agent and a Supplier
By: /s/ Theordore L. Parker
Name: Theordore L. Parker
Title: Vice President
Domestic
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
LIBOR
Office: 270 Park Avenue
New York, NY 10017
Facsimile No.: 212-270-4016
Attention: Renee Pierre-Louis
PERCENTAGE
7.514761100% FLEET PRECIOUS METALS INC.
By: /s/ W. Timothy Coggins/Eleanor Vander Mel
Name: W. Timothy Coggins/Eleanor Vander Mel
Title: Asst. Vice President/Vice President
Domestic
Office: 111 Westminster Street
Providence, RI 02903-2305
Facsimile No.: 401-278-3077
Attention: Dave Devel
LIBOR
Office: 111 Westminster Street
Providence, RI 02903-2305
Facsimile No.: 401-272-3440
Attention: Joyce Deschenes]
PERCENTAGE
7.514761100% NBD BANK, N.A.
By: /s/ Anna R. Hoffman
Name: Anna R. Hoffman
Title: Vice President
Domestic
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
LIBOR
Office: 611 Woodward Avenue
Detroit, Michigan 48302
Facsimile No.: 313-225-1586
Attention: Cheryl Brosovic/Ann Hoffman
PERCENTAGE
6.441223800% THE BANK OF TOKYO TRUST COMPANY
By: /s/ Jeffrey Miller
Name: Jeffrey Miller
Title:
Domestic
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
LIBOR
Office: The Bank of Tokyo
Trust Company
Telephone No.: 212-766-5461
Facsimile No.: 212-732-1678
Attention: Rolando Uy
PERCENTAGE
6.441223800% LTCB TRUST COMPANY
By: /s/ Rene LeBlanc
Name: Rene LeBlanc
Title: Senior Vice President
Domestic
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
LIBOR
Office: 165 Broadway
New York, NY 10006
Facsimile No.: (212) 608-3081
Attention: Winston Brown
PERCENTAGE
6.441223800% SHAWMUT BANK, N.A.
By: /s/ Kerry Day
Name: Kerry Day
Title: Assistant Vice President
Domestic
Office: One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
LIBOR
Office: Shawmut Bank, N.A.
One Federal St. OF-0324
Boston, Massachusetts 02211
Facsimile No.: 617-292-2566
Attention: Kerry Day
PERCENTAGE
4.294149200% CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Vice President
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By: /s/ Mark A. Campellone
Name: Mark A. Campellone
Title: Authorized Signature
In both cases:
Domestic
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
LIBOR
Office: 1301 Avenue of the Americas
New York, New York 10019
Facsimile No.: 212-459-3179
For Administrative
Matters:
Attention: Kevin McCarthy
For Credit Matters:
Attention: Andrea Griffis
PERCENTAGE
4.294149200% THE DAIWA BANK, LIMITED
By: /s/ J.H. Broadley
Name: J.H. Broadley
Title: Vice President
By: /s/ B.W. Henry
Name: B.W. Henry
Title: Vice President and Manager
Domestic
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
LIBOR
Office: The Daiwa Bank, Limited,
Chicago Branch
233 South Wacker Drive
Suite 4500
Chicago, Illinois 60606
Address for
Notices: The Daiwa Bank, Limited
450 Lexinton Avenue
Suite 1700
New York, New York 10017
Facsimile No.: 212-818-0866
Attention: Catherine Tiano, Credit
Administration Assistant
PERCENTAGE
4.294149200% DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ Jeffrey N. Wiesser
Name: Jeffrey N. Wieser
Title: Director
By: /s/ Jean M. Hannigan
Name: Jean M. Hannigan
Title: Assistant Vice President
Domestic
Office: Deutsche Bank AG,
New York and/or
Cayman Islands Branches
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
LIBOR
Office: Deutsche Bank AG,
Cayman Islands Branch
31 West 52nd Street
New York, New York 10019
Facsimile No.: 212-474-8212
Attention: Jeffrey N. Wieser/
Gregory M. Hill
PERCENTAGE
4.294149200% THE FUJI BANK LTD.
By: /s/ Gina Kearns
Name: Gina Kearns
Title: Vice President and Manager
Domestic
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
LIBOR
Office: The Fuji Bank, Limited,
New York Branch
Two World Trade Center,
79th Floor
New York, New York 10048
Facsimile No.: 212-912-0516
Attention: Yoshihiko Shiotsugu
PERCENTAGE
4.294149200% NATIONAL WESTMINSTER BANK USA
By: /s/ Phillip H. Sorace
Name: Phillip H. Sorace
Title: Vice President
Domestic
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
LIBOR
Office: 592 Fifth Avenue
New York, New York 10036
Facsimile No.: 212-602-2890
Attention: Patty Singh or Bob Gaiti
PERCENTAGE
3.220611900% ABN AMRO BANK N.V. NEW YORK BRANCH
By: /s/ Richard H. West
Name: Richard H. West
Title: Group Vice President
By: /s/ Rodolfo Barros
Name: Rodolfo Barros
Title: Vice President
Domestic
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
LIBOR
Office: 500 Park Avenue
New York, New York 10022
Facsimile No.: 212-688-5815
Attention: Ed Tice/Rodolfo Barros
PERCENTAGE
3.220611900% BANQUE PARIBAS
By: /s/ Richard G. Burrows
Name: Richard G. Burrows
Title: Vice President
By: /s/ Ann C. Pifer
Name: Ann C. Pifer
Title: Assistant Vice President
Domestic
Office: 787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
LIBOR
Office: Banque Paribas
787 Seventh Avenue
New York, NY 10019
Facsimile No.: 212-841-2217
For Administrative
Matters:
Attention: Loan Servicing Dept.
Facsimile No.: 212-841-2333
For Credit Matters:
Attention: Large Corp. Group
PERCENTAGE
3.220611900% GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By: /s/ D. Stephens/John Redding
Name: Dhuane G. Stephens/John P. Redding
Title: Vice President/
Domestic
Office: 65 East 55th Street
New York, New York 10022
Facsimile No: 212-644-0644
Attention: Dhuane Stephens
LIBOR
Office: 65 East 55th Street
New York, New York 10022
Facsimile No.: 212-421-2719
Attention: Orlando Diaz
PERCENTAGE
2.147074700% COMERICA BANK
By: /s/ Julie Burke Smith
Name: Julie Burke Smith
Title: Vice President
Domestic
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
LIBOR
Office: Comerica Bank
500 Woodward Avenue MC 3280
Detroit, Michigan 48226
Facsimile No.: 313-222-3330
Attention: Sandy Truman
PERCENTAGE
2.147074700% IBJ SCHRODER BANK & TRUST COMPANY
By: /s/ J. Christopher Mangan
Name: J. Christopher Mangan
Title: Vice President
Domestic
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
LIBOR
Office: One State Street
New York, New York 10004
Facsimile No.: 212-858-2768
Attention: Mr. Jamie M. Weston
PERCENTAGE
2.147074700% THE MITSUBISHI BANK, LIMITED -
NEW YORK BRANCH
By: /s/ Paula Mueller
Name: Paula Mueller
Title: Vice President
Domestic
Office: 225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
LIBOR
Office: The Mitsubishi Bank, Limited
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Facsimile No.: 212-667-3562
Attention: Ms. Paula Mueller,
Vice President
PERCENTAGE
2.147074700% YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By: /s/ Nicholas Pullen
Name: Nicholas Pullen
Title: Vice President
Domestic
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
LIBOR
Office: 666 Fifth Avenue, Suite 801
New York, New York 10103
Facsimile No.: 212-373-5797
Attention: Mr. Richard Ortiz
100%
HANDY & HARMAN HAS REVIEWED THE TERMS OF
THIS AGREEMENT, AND ACKNOWLEDGES THE EFFECT
OF SUCH TERMS AS THEY RELATE TO HANDY &
HARMAN'S OBLIGATIONS UNDER SECTION 9.3 AND
SECTION 9.4 OF THE FEE CONSIGNMENT
AGREEMENT:
HANDY & HARMAN
By: /s/ Stephen B. Mudd
Name: Stephen B. Mudd
Title: Vice President
and Treasurer
