<PAGE>
FORM 10-K/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
AMENDMENT TO APPLICATION OR REPORT
Filed pursuant to Section 12, 13, or 15(d) of THE SECURITIES
EXCHANGE ACT OF 1934
HONEYWELL INC.
---------------------------------------------------------------------
(Exact name of registrant as specified in charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report Under Section 12 or
15(d) of the Securities Exchange Act of 1934 for the Fiscal Year Ended December
31, 1993 on Form 10-K as set forth below:
(List all such items, financial statements, exhibits or other portions
amended)
Exhibit 10(i) to the report, which was filed with portions thereof redacted
pursuant to a Request for Confidential Treatment of same, is hereby supplemented
by filing same herewith in its entirety.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
HONEYWELL INC.
(Registrant)
Date: May 10, 1994 By:
-------------------------------
Edward D. Grayson
Vice President and
General Counsel
<PAGE>
CREDIT AND REIMBURSEMENT AGREEMENT
AGREEMENT dated as of December 9, 1993 among HONEYWELL INC., the BANKS
listed on the signature pages hereof, the CO-AGENTS listed on the signature
pages hereof and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Administrative
Agent.
WHEREAS, in a civil action (No. CV-90-0093 MRP (Ex)) for patent
infringement claims relating to ring laser gyroscopes used in commercial
aircraft pending in the United States District Court for the Central District of
California, the jury rendered a verdict on August 31, 1993 in favor of Litton
Industries, Inc. (the "Claimant") awarding damages against the Borrower in the
amount of $1,200,000,000;
WHEREAS, if any significant judgment is entered by such Court in such
action, the Borrower intends to appeal such judgment to a United States Court of
Appeals and, if such judgment is affirmed by such Court of Appeals, to the
United States Supreme Court, and, in connection with any such appeal and for the
purpose of staying execution of any such judgment and providing for the payment
when due of the amount of any such judgment or any settlement between the
Borrower and the Claimant of the claims on which such action is based, the
Borrower has requested that the Banks make loans to the Borrower or issue
letters of credit for the account of the Borrower in an aggregate amount of up
to $1,200,000,000; and
WHEREAS, the Banks are willing to make such loans to the Borrower and
issue such letters of credit for the account of the Borrower pursuant to the
terms of this Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINITIONS. The following terms, as used herein, have
the following meanings:
1
<PAGE>
"Abandoned Subsidiary" means any Subsidiary of the Borrower (i) as to
which a determination shall have been made in accordance with Section 5.04 to
terminate such Subsidiary's corporate existence and (ii) the fair market value
of the assets of which, immediately prior to such termination, shall not exceed
$5,000,000.
"Absolute Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Action" means the civil action (No. CV-90-0093 MRP (Ex)) in the Court
for patent infringement claims relating to ring laser gyroscopes used in
commercial aircraft brought by the Claimant against the Borrower but excluding
any claims arising out of antitrust or other allegations.
"Adjusted CD Rate" has the meaning set forth in Section 2.07(b).
"Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.07(c).
"Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means, with respect to any Person, (i) any Person that
directly, or indirectly through one or more intermediaries, controls such former
Person (a "Controlling Person") and (ii) any Person (other than a Subsidiary of
such former Person) which is controlled by or is under common control with a
Controlling Person. As used herein, the term "control" means possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" means Morgan Guaranty Trust Company of New York in its
capacity as administrative agent for the Banks hereunder, and its successors in
such capacity.
"Aggregate LC Amount" has the meaning set forth in Section 6.02.
"Applicable Lending Office" means, with respect to any Bank, (i) in
the case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of
its Euro-Dollar
2
<PAGE>
Loans, its Euro-Dollar Lending Office and (iii) in the case of its Money Market
Loans, its Money Market Lending Office.
"Assessment Rate" has the meaning set forth in Section 2.07(b).
"Assignee" has the meaning set forth in Section 9.06(c).
"Available LC Amount" means at any time an amount equal to the excess,
if any, of the aggregate amount of the Commitments over the aggregate
outstanding amount of Loans (if any) at such time.
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 9.06(c), and their respective
successors.
"Base Rate" means, for any day, a rate per annum equal to the higher
of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means (i) a Committed Loan which bears interest at
the Base Rate pursuant to the applicable Notice of Committed Borrowing or Notice
of Interest Rate Election or the provisions of Article VIII or (ii) an overdue
amount which was a Base Rate Loan immediately before it became overdue.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means Honeywell Inc., a Delaware corporation, and its
successors.
"Borrower's 1992 Form 10-K" means the Borrower's annual report on Form
10-K for the year ended December 31, 1992, as amended by Form 8 Amendment dated
May 3, 1993, as filed with the Securities and Exchange Commission pursuant to
the Securities Exchange Act of 1934.
"Borrowing" has the meaning set forth in Section 1.03.
"CD Base Rate" has the meaning set forth in Section 2.07(b).
3
<PAGE>
"CD Loan" means (i) a Committed Loan which bears interest at a CD Rate
pursuant to the applicable Notice of Committed Borrowing or Notice of Interest
Rate Election or (ii) an overdue amount which was a CD Loan immediately before
it became overdue.
"CD Margin" has the meaning set forth in Section 2.07(b).
"CD Rate" means a rate of interest determined pursuant to Section
2.07(b) on the basis of an Adjusted CD Rate.
"CD Reference Banks" means The Chase Manhattan Bank (National
Association), Citibank, N.A., Bank of America National Trust and Savings
Association, The Fuji Bank, Limited and Morgan Guaranty Trust Company of New
York.
"Claimant" has the meaning set forth in the first Whereas Clause.
"Closing Date" means the date on or after which the Agent shall have
received the documents specified in or pursuant to Section 3.01.
"Co-Agents" means the Banks listed as Co-Agents on the signature pages
hereof, each in its capacity as Co-Agent.
"Co-Arrangers" means J.P. Morgan Securities Inc. and Chase Securities,
Inc., each in its capacity as co-arranger.
"Commitment" means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, as such amount may
be reduced from time to time pursuant to Section 2.09.
"Committed Loan" means a loan made by a Bank pursuant to Section 2.01;
PROVIDED that, if any such loan or loans (or portions thereof) are combined or
subdivided pursuant to a Notice of Interest Rate Election, the term "Committed
Loan" shall refer to the combined principal amount resulting from such
combination or to each of the separate principal amounts resulting from such
subdivision, as the case may be.
"Consolidated Adjusted Net Worth" means at any date the consolidated
stockholders' equity of the Borrower
4
<PAGE>
and its Consolidated Subsidiaries as of such date less the amount, to the extent
reflected in determining such consolidated stockholders' equity, of all
goodwill.
"Consolidated Cash Flow" means, for any period, the sum of (i)
Consolidated Net Income for such period PLUS (ii) to the extent deducted in
determining such Consolidated Net Income, the sum of depreciation, amortization
and other similar non-cash charges PLUS (iii) the amount of any pre-tax
provision for the Judgment or any Settlement taken as a charge in determining
such Consolidated Net Income.
"Consolidated Domestic Subsidiary" means any Consolidated Subsidiary
organized under the laws of any jurisdiction in the United States.
"Consolidated Indebtedness" means at any date the sum of (i) all
short-term and long-term debt that would be included in a consolidated statement
of financial position of the Borrower and its Consolidated Subsidiaries,
determined as of such date PLUS (ii) the amount (if any) by which the aggregate
outstanding principal amount of Debt specified in clause (vii) of the definition
of Debt set forth in this Section 1.01 of the Borrower and its Consolidated
Subsidiaries determined on a consolidated basis as of such date exceeds
$15,000,000.
"Consolidated Net Income" means, for any period, consolidated net
income of the Borrower and its Consolidated Subsidiaries for such period.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which would be consolidated with those of the Borrower in
its consolidated financial statements if such statements were prepared as of
such date.
"Consolidated Total Capital" means at any date the sum of Consolidated
Adjusted Net Worth plus Consolidated Indebtedness, each determined as of such
date.
"Court" means the United States District Court for the Central
District of California.
"Credit Availability Period" means the period from the Effective Date
to but excluding the Termination Date.
"Credit Event" means the making of a Loan or the issuance of a Letter
of Credit.
5
<PAGE>
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (v) all Debt secured
by a Lien on any asset of such Person, whether or not such Debt is otherwise an
obligation of such Person (to the extent of the lesser of the amount of such
Debt and the book value of any assets subject to such Lien),(vi) all non-
contingent obligations of such Person to reimburse or prepay any bank or other
Person in respect of amounts paid under a letter of credit, banker's acceptance
or similar instrument and (vii) all Debt of others Guaranteed by such Person (to
the extent of the lesser of the amount of such Debt Guaranteed or the amount of
such Guarantee).
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City are authorized by law to
close.
"Domestic Lending Office" means, as to each Bank, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Agent; PROVIDED that any Bank may so designate
separate Domestic Lending Offices for its Base Rate Loans, on the one hand, and
its CD Loans, on the other hand, in which case all references herein to the
Domestic Lending Office of such Bank shall be deemed to refer to either or both
of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in Section
2.07(b).
6
<PAGE>
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 9.09.
"Entry Date" means the date on which the Court enters any judgment in
the Action awarding damages against the Borrower.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, injunctions, permits, licenses, agreements and other
governmental restrictions relating to the environment, the effect of the
environment on human health or to emissions, discharges or releases of
pollutants, contaminants, Hazardous Substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants, contaminants,
Hazardous Substances or wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrower and the Agent.
"Euro-Dollar Loan" means (i) a Committed Loan which bears interest at
a Euro-Dollar Rate pursuant to the applicable Notice of Committed Borrowing or
Notice of Interest Rate Election or (ii) an overdue amount which was a
Euro-Dollar Loan immediately before it became overdue.
7
<PAGE>
"Euro-Dollar Margin" has the meaning set forth in Section 2.07(c).
"Euro-Dollar Rate" means a rate of interest determined pursuant to
Section 2.07(c) on the basis of an Adjusted London Interbank Offered Rate.
"Euro-Dollar Reference Banks" means the principal London offices of
The Chase Manhattan Bank (National Association), Citibank, N.A., Bank of America
National Trust and Savings Association, The Fuji Bank, Limited and Morgan
Guaranty Trust Company of New York.
"Euro-Dollar Reserve Percentage" has the meaning set forth in Section
2.07(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, PROVIDED that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to Morgan Guaranty Trust Company of New
York on such day on such transactions as determined by the Agent.
"Final Fee Payment Date" has the meaning set forth in Section 2.08(a).
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money Market
Loans (excluding Money Market LIBOR Loans bearing interest at the Base Rate
pursuant to Section 8.01(a)) or any combination of the foregoing.
"Foreign Person" means (i) any government (a "Foreign Government")
other than the United States government or the government of any political
subdivision thereof, (ii) any agency or representative of a Foreign Government,
(iii) any form of business enterprise organized
8
<PAGE>
under the laws of any country other than the United States or its possessions or
any political subdivision thereof or (iv) any form of business enterprise owned
or controlled by any of the persons described in clauses (i), (ii) or (iii)
above.
"Group of Loans" means at any time a group of Loans consisting of (i)
all Committed Loans which are Base Rate Loans at such time or (ii) all Committed
Loans which are Fixed Rate Loans of the same type having the same Interest
Period at such time; PROVIDED that, if a Committed Loan of any particular Bank
is converted to or made as a Base Rate Loan pursuant to Section 8.02 or 8.05,
such Loan shall be included in the same Group or Groups of Loans from time to
time as it would have been in if it had not been so converted or made.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt (whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Debt of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part), PROVIDED that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydrocarbons, or any substance having any constituent elements
displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.03(b).
"Initial Termination Date" means January 31, 1994 or such later date
as shall have been agreed to in writing by the Borrower and each of the Banks
from time to time.
9
<PAGE>
"Interest and Costs" means pre- and post-judgment interest on the
Judgment and court costs and attorneys' and experts' fees, if any, required by
the Court to be paid by the Borrower in the Action.
"Interest Period" means: (1) with respect to each Euro-Dollar Loan, a
period commencing on the date of Borrowing specified in the applicable Notice of
Borrowing or on the date specified in the applicable Notice of Interest Rate
Election and ending one, two, three or six months thereafter, as the Borrower
may elect in the applicable Notice; PROVIDED that:
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business
Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(2) with respect to each CD Loan, a period commencing on the date of Borrowing
specified in the applicable Notice of Borrowing or on the date specified in the
applicable Notice of Interest Rate Election and ending 30, 60, 90 or 180 days
thereafter, as the Borrower may elect in the applicable Notice; PROVIDED that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
10
<PAGE>
(3) with respect to each Money Market LIBOR Borrowing, the period commencing on
the date of borrowing specified in the applicable Notice of Borrowing and ending
such whole number of months thereafter as the Borrower may elect in accordance
with Section 2.03; PROVIDED that:
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business
Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(4) with respect to each Money Market Absolute Rate Borrowing, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing and ending such number of days thereafter (but not less than seven
days) as the Borrower may elect in accordance with Section 2.03; PROVIDED that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Judgment" means any award for damages (excluding Interest and Costs),
entered by the Court, or, upon appeal, by a United States Court of Appeals or
the United States Supreme Court, against the Borrower in favor of the Claimant
in the Action.
11
<PAGE>
"LC Exposure" means, at any time and for any Bank, an amount equal to
such Bank's share of the amount of Letter of Credit Liabilities in respect of
each Letter of Credit outstanding at such time.
"Letter of Credit" has the meaning set forth in Section 2.15(a).
"Letter of Credit Liabilities" means, at any time and in respect of
any Letter of Credit, the sum, without duplication, of (i) the amount available
for drawing under such Letter of Credit plus (ii) the aggregate unpaid amount of
all Reimbursement Obligations in respect of previous drawings made under such
Letter of Credit.
"Level I Status" exists at any date if, at such date, the Borrower's
outstanding senior unsecured long-term debt securities are rated either A+ or
higher by S&P OR A1 or higher by Moody's.
"Level II Status" exists at any date if, at such date, (i) the
Borrower's outstanding senior unsecured long-term debt securities are rated
either A or higher by S&P OR A2 or higher by Moody's AND (ii) Level I Status
does not exist at such date.
"Level III Status" exists at any date if, at such date, (i) the
Borrower's outstanding senior unsecured long-term debt securities are rated
either A- or higher by S&P OR A3 or higher by Moody's AND (ii) neither Level I
Status nor Level II Status exists at such date.
"Level IV Status" exists at any date if, at such date, (i) the
Borrower's outstanding senior unsecured long-term debt securities are rated
either BBB+ or higher by S&P OR Baa1 or higher by Moody's AND (ii) none of Level
I Status, Level II Status or Level III Status exists at such date.
"Level V Status" exists at any date if, at such date, (i) the
Borrower's outstanding senior unsecured long-term debt securities are rated BBB
or higher by S&P AND Baa2 or higher by Moody's AND (ii) none of Level I Status,
Level II Status, Level III Status or Level IV Status exists at such date.
"Level VI Status" exists at any date if none of Level I Status, Level
II Status, Level III Status, Level IV Status or Level V Status exists at such
date.
12
<PAGE>
"LIBOR Auction" means a solicitation of Money Market Quotes setting
forth Money Market Margins based on the London Interbank Offered Rate pursuant
to Section 2.03.
"Lien" means, with respect to any asset, any mortgage, pledge or
security interest, or any other type of preferential arrangement that has the
practical effect of creating a security interest, in respect of such asset.
"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money Market
Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money Market Loans
or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in Section
2.07(c).
"Material Adverse Effect" means a material adverse effect on the
business, consolidated financial position or consolidated results of operations
(such results of operations to be considered on a four fiscal quarter basis) of
the Borrower and its Consolidated Subsidiaries, considered as a whole.
"Material Debt" means Debt (other than the Notes) of the Borrower
and/or one or more of its Subsidiaries, arising in one or more related or
unrelated transactions, in an aggregate principal amount exceeding $10,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $50,000,000.
"Money Market Absolute Rate" has the meaning set forth in Section
2.03(d).
"Money Market Absolute Rate Loan" means a loan to be made by a Bank
pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
Lending Office or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Money Market Lending Office by notice to the Borrower
and the Agent; PROVIDED that any Bank may from time to time by notice to the
Borrower and the Agent designate separate Money Market Lending Offices for its
Money Market LIBOR Loans, on the one hand, and its Money Market Absolute Rate
Loans, on the other hand, in which case all references herein to the Money
Market Lending Office of
13
<PAGE>
such Bank shall be deemed to refer to either or both of such offices, as the
context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank pursuant
to a LIBOR Auction (including such a loan bearing interest at the Base Rate
pursuant to Section 8.01(a)).
"Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section 2.03(d).
"Money Market Quote" means an offer by a Bank to make a Money Market
Loan in accordance with Section 2.03.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Multiemployer Plan" means at any time an employee pension benefit
plan within the meaning of Section 4001(a)(3) of ERISA to which any member of
the ERISA Group is then making or accruing an obligation to make contributions
or has within the preceding five plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group during
such five year period.
"Notes" means promissory notes of the Borrower, substantially in the
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
Loans, and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined in
Section 2.03(f)).
"Notice of Interest Rate Election" has the meaning set forth in
Section 2.11.
"Notice of Issuance" has the meaning set forth in Section 2.15(b).
"Parent" means, at any time with respect to any Bank, any Person which
at such time directly or indirectly owns securities or other ownership interests
of such Bank having ordinary voting power to elect a majority of the
14
<PAGE>
board of directors of, or other Persons performing similar functions for, such
Bank.
"Participant" has the meaning set forth in Section 9.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other than
a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"Prime Rate" means the rate of interest publicly announced by Morgan
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.
"Quarterly Date" means the last Euro-Dollar Business Day of each
March, June, September and December.
"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any one
of such Reference Banks.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Reimbursement Due Date" has the meaning set forth in Section 2.15(e).
"Reimbursement Obligations" means at any date the obligations of the
Borrower then outstanding under Section 2.15 to reimburse any Bank for the
amount paid by such Bank in respect of a drawing under a Letter of Credit.
15
<PAGE>
"Required Banks" means at any time Banks having at least 66-2/3% of
the aggregate amount of the Commitments or, if the Commitments shall have been
terminated, having at least 66 2/3% of the aggregate Total Exposures of all of
the Banks.
"Restricted Asset" means any real property (excluding equipment and
fixtures installed thereon or affixed thereto) owned or leased by the Borrower
or any of its Consolidated Domestic Subsidiaries, and any capital stock or
indebtedness of any Consolidated Domestic Subsidiary having assets with a book
value in excess of $10,000,000.
"Sell-Down Date" means the earlier of (i) the date on which the
Borrower has agreed, by notice to the Agent and the Banks, to permit each Bank
to assign or sell participating interests in its Commitment, Loans and Letter of
Credit Liabilities to one or more banks or other institutions pursuant to
Section 9.06 and (ii) the fifth Domestic Business Day after the Entry Date.
"Settlement" means the total amount (including any amount in respect
of Interest and Costs) payable by the Borrower to the Claimant pursuant to a
final settlement between the Borrower and the Claimant of the claims on which
the Action is based.
"Settlement Date" means the earlier of (i) the date on which any
provision for the Judgment or any Settlement is taken in a consolidated
statement of income of the Borrower and its Consolidated Subsidiaries for any
period in which such date occurs and (ii) the date on which the Claimant
receives any portion of the amount payable in respect of the Judgment or any
Settlement.
"S&P" means Standard & Poor's Ratings Group and its successors.
"Status" means each of Level I Status, Level II Status, Level III
Status, Level IV Status, Level V Status and Level VI Status.
"Subsidiary" means any corporation or other entity of which securities
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by the Borrower.
16
<PAGE>
"Term Sheet" means the summary of Terms and Conditions, including the
fee grids attached thereto, outlining the principal terms and conditions of this
Agreement, delivered by the Agent to each of the Banks.
"Termination Date" means the later of (i) the Initial Termination Date
and (ii) if on or prior to the Initial Termination Date the Sell-Down Date has
occurred, June 30, 1999; PROVIDED that if any such day is not a Euro-Dollar
Business Day, the Termination Date shall be the next succeeding Euro-Dollar
Business Day unless such Euro-Dollar Business Day falls in another calendar
month, in which the Termination Date shall be the next preceding Euro-Dollar
Business Day.
"Total Exposure" means, with respect to any Bank at any time, the sum
of (i) the aggregate principal amount of its Loans then outstanding and (ii) the
aggregate amount of its Letter of Credit Liabilities at such time.
"Unfunded Liabilities" means, with respect to any Plan at any time,
the amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the
States and the District of Columbia, but excluding its territories and
possessions.
"Wholly-Owned Consolidated Subsidiary" means any Consolidated
Subsidiary all of the shares of capital stock or other ownership interests of
which (except directors' qualifying shares) are at the time directly or
indirectly owned by the Borrower.
SECTION 1.02. ACCOUNTING TERMS AND DETERMINATIONS. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time,
17
<PAGE>
applied on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks; PROVIDED that, if the Borrower notifies the Agent that the
Borrower wishes to amend any covenant in Article V to eliminate the effect of
any change in generally accepted accounting principles on the operation of such
covenant (or if the Agent notifies the Borrower that the Required Banks wish to
amend Article V for such purpose), then the Borrower's compliance with such
covenant shall be determined on the basis of generally accepted accounting
principles in effect immediately before the relevant change in generally
accepted accounting principles became effective, until either such notice is
withdrawn or such covenant is amended in a manner satisfactory to the Borrower
and the Required Banks.
SECTION 1.03. TYPES OF BORROWINGS. The term "Borrowing" denotes the
aggregation of Loans of one or more Banks to be made to the Borrower pursuant to
Article II on the same date, all of which Loans are of the same type (subject to
Article VIII) and, except in the case of Base Rate Loans, have the same Interest
Period or initial Interest Period. Borrowings are classified for purposes of
this Agreement either by reference to the pricing of Loans comprising such
Borrowing (E.G., a "Euro-Dollar Borrowing" is a Borrowing comprised of
Euro-Dollar Loans) or by reference to the provisions of Article II under which
participation therein is determined (I.E., a "Committed Borrowing" is a
Borrowing under Section 2.01 in which all Banks participate in proportion to
their Commitments, while a "Money Market Borrowing" is a Borrowing under Section
2.03 in which the Bank participants are determined on the basis of their bids in
accordance therewith).
SECTION 1.04. BASIS FOR RATINGS; DEEMED RATINGS. (a) The credit
ratings to be utilized in the determination of a Status are the ratings assigned
to unsecured obligations of the Borrower without third party credit support.
Ratings assigned to any obligation which is secured or which has the benefit of
third party credit support shall be disregarded.
(b) If at any time (i) either S&P or Moody's has not publicly rated
the Borrower's outstanding senior unsecured long-term debt securities (the
"Ratable Securities") or no Ratable Securities of the Borrower are outstanding
at such time and (ii) at such time S&P or Moody's has provided written evidence
of a rating of Ratable
18
<PAGE>
Securities that is implied from the rating that S&P or Moody's, as the case
may be, has assigned to the Borrower's outstanding subordinated unsecured
long-term debt securities or the Borrower's outstanding senior secured
long-term debt securities, if any, such implied rating by S&P or
Moody's, as the case may be (together with the public rating or the implied
rating referred to in this subsection (b) of the other rating agency, if
available), shall be used for purposes
of determining any Status.
(c) If at any time (i) either S&P or Moody's has not publicly rated
the Ratable Securities or no Ratable Securities of the Borrower are outstanding
at such time, (ii) no implied rating by S&P or Moody's, as the case may be, is
available in accordance with subsection (b) above at such time and (iii) at such
time the Borrower has obtained a private letter rating from S&P or Moody's, as
the case may be, of the Ratable Securities, such private letter rating of S&P or
Moody's, as the case may be (together with the public rating or the implied
rating referred to in subsection (b) above of the other rating agency, if
available), shall be used for purposes of determining any Status.
(d) For purposes of determining Level I Status, Level II Status,
Level III Status and Level IV Status, if at any date the rating of the
Borrower's Ratable Securities by Moody's shall be higher or lower than the
comparable rating by S&P by two or more rating levels (it being understood that
for these purposes an S&P rating of A+ is comparable to a Moody's rating of A1,
an S&P rating of A is comparable to a Moody's rating of A2, and so forth), then
the rating of the Ratable Securities by each of Moody's and S&P shall be deemed
to be the comparable S&P and Moody's ratings at the midpoint between the two
actual ratings, or, if there shall be no rating at the midpoint, the next higher
rating from the midpoint between the two actual ratings. For example, if the
Ratable Securities are rated A+ by S&P and A3 by Moody's, the Ratable Securities
shall be deemed to be rated A by S&P and A2 by Moody's; and if the Ratable
Securities are rated BBB by S&P and A2 by Moody's, the Ratable Securities shall
be deemed to be rated A- by S&P and A3 by Moody's.
ARTICLE II
THE CREDITS
SECTION 2.01. COMMITMENTS TO LEND. During the Credit Availability
Period, each Bank severally agrees, on
19
<PAGE>
the terms and conditions set forth in this Agreement, to make loans to the
Borrower pursuant to this Section from time to time in amounts such that the sum
of (x) the aggregate principal amount of Committed Loans by such Bank plus (y)
such Bank's LC Exposure at any one time outstanding shall not exceed the amount
of its Commitment. Each Borrowing under this Section 2.01 shall be in an
aggregate principal amount of $25,000,000 or any larger multiple of $1,000,000
(except that any such Borrowing may be in the aggregate amount available in
accordance with Section 3.02(c)) and shall be made from the several Banks
ratably in proportion to their respective Commitments. Within the foregoing
limits, the Borrower may borrow under this Section 2.01, repay or, to the extent
permitted by Section 2.10, prepay Loans and reborrow at any time during the
Credit Availability Period pursuant to this Section 2.01.
SECTION 2.02. NOTICE OF COMMITTED BORROWING. (a) The Borrower shall
give the Agent notice (a "Notice of Committed Borrowing") not later than 11:00
A.M. (New York City time) on (x) the date of each Base Rate Borrowing, (y) the
second Domestic Business Day before each CD Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(a) the date of such Borrowing, which shall be a Domestic Business
Day in the case of a Domestic Borrowing or a Euro-Dollar Business Day in
the case of a Euro-Dollar Borrowing,
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to bear interest
initially at the Base Rate or at a CD Rate or a Euro-Dollar Rate, and
(d) in the case of a Fixed Rate Borrowing, the duration of the
initial Interest Period applicable thereto, subject to the provisions of
the definition of Interest Period.
(b) The provisions of subsection (a) above notwithstanding, if the
Borrower shall not have given a Notice of Borrowing not later than 11:00 A.M.
(New York City time) on any Reimbursement Due Date, then, unless the Borrower
notifies the Agent before such time that it elects not to borrow on such date,
the Agent shall be deemed to have received a Notice of Committed Borrowing
specifying that (i) the date of the proposed Borrowing shall be such
Reimbursement Due Date, (ii) the aggregate amount of the
20
<PAGE>
proposed Borrowing shall be the aggregate amount of the Reimbursement
Obligations due and payable on such Reimbursement Due Date, and (iii) the Loans
comprising the proposed Borrowing are to be Base Rate Loans.
SECTION 2.03. MONEY MARKET BORROWINGS.
(a) THE MONEY MARKET OPTION. In addition to Committed Borrowings
pursuant to Section 2.01, the Borrower may, as set forth in this Section,
request the Banks during the Credit Availability Period to make offers to make
Money Market Loans to the Borrower. The Banks may, but shall have no obligation
to, make such offers and the Borrower may, but shall have no obligation to,
accept any such offers in the manner set forth in this Section.
(b) MONEY MARKET QUOTE REQUEST. When the Borrower wishes to request
offers to make Money Market Loans under this Section, it shall transmit to the
Agent by telex or facsimile transmission a Money Market Quote Request
substantially in the form of Exhibit B hereto so as to be received no later than
10:00 A.M. (New York City time) on (x) the fifth Euro-Dollar Business Day prior
to the date of Borrowing proposed therein, in the case of a LIBOR Auction or (y)
the Domestic Business Day next preceding the date of Borrowing proposed therein,
in the case of an Absolute Rate Auction (or, in either case, such other time or
date as the Borrower and the Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Euro-Dollar
Business Day in the case of a LIBOR Auction or a Domestic Business Day in
the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$25,000,000 or a larger multiple of $1,000,000,
(iii) the duration of the Interest Period applicable thereto, subject
to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth a
Money Market Margin or a Money Market Absolute Rate.
21
<PAGE>
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) INVITATION FOR MONEY MARKET QUOTES. Promptly upon receipt of a
Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit C hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance with
this Section.
(d) SUBMISSION AND CONTENTS OF MONEY MARKET QUOTES. (i) Each Bank
may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Agent by telex or facsimile transmission at its offices
specified in or pursuant to Section 9.01 not later than (x) 2:00 P.M. (New York
City time) on the fourth Euro-Dollar 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 (or,
in either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective); PROVIDED that Money Market
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank may be submitted, and may only be submitted, if the Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) one hour prior to the deadline for the other Banks,
in the case of a LIBOR Auction or (y) 15 minutes prior to the deadline for the
other Banks, in the case of an Absolute Rate Auction. Subject to Articles III
and VI, any Money Market Quote so made shall be irrevocable except with the
written consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit D hereto and shall in any case specify:
22
<PAGE>
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for which each such
offer is being made, which principal amount (w) may be greater than or less
than the Commitment of the quoting Bank, (x) must be $5,000,000 or a larger
multiple of $1,000,000, (y) may not exceed the principal amount of Money
Market Loans for which offers were requested and (z) may be subject to an
aggregate limitation as to the principal amount of Money Market Loans for
which offers being made by such quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable London Interbank Offered Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or subtracted
from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest per
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto or does
not specify all of the information required by subsection (d)(ii);
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth in
the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
23
<PAGE>
(e) NOTICE TO BORROWER. The Agent shall promptly notify the Borrower
of the terms (x) of any Money Market Quote submitted by a Bank that is in
accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest error in
such former Money Market Quote. The Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Money Market Loans for which
offers have been received for each Interest Period specified in the related
Money Market Quote Request, (B) the respective principal amounts and Money
Market Margins or Money Market Absolute Rates, as the case may be, so offered
and (C) if applicable, limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be accepted.
(f) ACCEPTANCE AND NOTICE BY BORROWER. Not later than 10:30 A.M.
(New York City time) on (x) the third Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the proposed
date of Borrowing, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Agent shall have mutually agreed
and shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), the Borrower shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money
Market Quote in whole or in part; PROVIDED that:
(i) the aggregate principal amount of each Money Market Borrowing may
not exceed the applicable amount set forth in the related Money Market
Quote Request,
(ii) the aggregate principal amount of each Money Market Borrowing
must be $25,000,000 or a larger multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of ascending
Money Market Margins or Money Market Absolute Rates, as the case may be,
and
24
<PAGE>
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the requirements
of this Agreement.
(g) ALLOCATION BY AGENT. If offers are made by two or more Banks
with the same Money Market Margins or Money Market Absolute Rates, as the case
may be, for a greater aggregate principal amount than the amount in respect of
which such offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted shall
be allocated by the Agent among such Banks as nearly as possible (in multiples
of $1,000,000, as the Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. NOTICE TO BANKS; FUNDING OF LOANS.
(a) Upon receipt of a Notice of Borrowing, the Agent shall promptly
notify each Bank of the contents thereof and of such Bank's share (if any) of
such Borrowing and such Notice of Borrowing shall not thereafter be revocable by
the Borrower.
(b) Not later than 1:00 P.M. (New York City time) on the date of each
Borrowing, each Bank participating therein shall make available its share of
such Borrowing, in Federal or other funds immediately available in New York
City, to the Agent at its address referred to in Section 9.01. Unless the Agent
determines that any applicable condition specified in Article III has not been
satisfied, the Agent will make the funds so received from the Banks available to
the Borrower promptly after being made available to the Agent at the Agent's
aforesaid address in the same type of funds as those received by the Agent.
(c) Unless the Agent shall have received notice from a Bank prior to
the date of any Borrowing that such Bank will not make available to the Agent
such Bank's share of such Borrowing, the Agent may assume that such Bank has
made such share available to the Agent on the date of such Borrowing in
accordance with subsection (b) of this Section 2.04 and the Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on
25
<PAGE>
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Agent, at (i) in the case of the Borrower, a rate per
annum equal to the higher of the Federal Funds Rate and the interest rate
applicable thereto pursuant to Section 2.07 and (ii) in the case of such Bank,
the Federal Funds Rate. If such Bank shall repay to the Agent such
corresponding amount, such amount so repaid shall constitute such Bank's Loan
included in such Borrowing for purposes of this Agreement.
SECTION 2.05. NOTES. (a) The Loans of each Bank shall be evidenced
by a single Note payable to the order of such Bank for the account of its
Applicable Lending Office in an amount equal to the aggregate unpaid principal
amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the Agent, request
that its Loans of a particular type be evidenced by a separate Note in an amount
equal to the aggregate unpaid principal amount of such Loans. Each such Note
shall be in substantially the form of Exhibit A hereto with appropriate
modifications to reflect the fact that it evidences solely Loans of the relevant
type. Each reference in this Agreement to the "Note" of such Bank shall be
deemed to refer to and include any or all of such Notes, as the context may
require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.01(a), the
Agent shall forward such Note to such Bank. Each Bank shall record the date,
amount and type of each Loan made by it and the date and amount of each payment
of principal made by the Borrower with respect thereto, and may, if such Bank so
elects in connection with any transfer or enforcement of its Note, endorse on
the schedule forming a part thereof appropriate notations to evidence the
foregoing information with respect to each such Loan then outstanding; PROVIDED
that the failure of any Bank to make any such recordation or endorsement shall
not affect the obligations of the Borrower hereunder or under the Notes. Each
Bank is hereby irrevocably authorized by the Borrower so to endorse its Note and
to attach to and make a part of its Note a continuation of any such schedule as
and when required.
SECTION 2.06. SCHEDULED TERMINATION OF COMMITMENTS AND MATURITY OF
LOANS. (a) The Commitments shall terminate on the Termination Date and any
Committed Loans then outstanding (together with accrued interest
26
<PAGE>
thereon) and all accrued fees hereunder shall be due and payable in full on such
date.
(b) Each Money Market Loan included in any Money Market Borrowing
shall mature, and the principal amount thereof shall be due and payable, on the
last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. INTEREST RATES. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due, at a rate per annum equal to the Base
Rate for such day. Such interest shall be payable quarterly in arrears on each
Quarterly Date and, with respect to the principal amount of any Base Rate Loan
converted to a CD Loan or a Euro-Dollar Loan, on the date such Base Rate Loan is
so converted. Any overdue principal of or interest on any Base Rate Loan shall
bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the actual date of payment at a rate
per annum equal to the sum of 2% plus the Base Rate for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during each Interest Period applicable thereto, at
a rate per annum equal to the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Interest Period; PROVIDED that if any CD
Loan or any portion thereof shall, as a result of clause (2)(b) of the
definition of Interest Period, have an Interest Period of less than 30 days,
such portion shall bear interest during such Interest Period at the rate
applicable to Base Rate Loans during such period. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than 90 days, 90 days after the first day thereof. Any overdue
principal of or interest on any CD Loan shall bear interest, payable on demand,
for each day from and including the date payment thereof was due to but
excluding the actual date of payment at a rate per annum equal to the sum of 2%
plus (i) if principal of or interest on such CD Loan shall have become overdue
during an Interest Period applicable to such CD Loan, for each such day before
the last day of such Interest Period, the sum of the CD Margin plus the Adjusted
CD Rate applicable to such Loan for such Interest Period, and (ii) for the last
day of such Interest Period and each day thereafter, the Base Rate for such day.
"CD Margin" means (i) .300% per annum for any day on which Level I
Status exists, (ii) .375% per annum for any
27
<PAGE>
day on which Level II Status exists, (iii) .400% per annum for any day on
which Level III Status exists, (iv) .4375% per annum for any day on which
Level IV Status exists, (v) .450% per annum for any day on which Level V
Status exists and (vi) .525% per annum for any day on which Level VI Status
exists. The basis and determination of any Status shall be subject to
Section 1.04.
The "Adjusted CD Rate" applicable to any Interest Period means a rate
per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
__________
* The amount in brackets being rounded upward, if
necessary, to the next higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the rate of
interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum bid
at 10:00 A.M. (New York City time) (or as soon thereafter as practicable) on the
first day of such Interest Period by two or more New York certificate of deposit
dealers of recognized standing for the purchase at face value from each CD
Reference Bank of its certificates of deposit in an amount comparable to the
principal amount of the CD Loan of such CD Reference Bank to which such Interest
Period applies and having a maturity comparable to such Interest Period,
excluding from the calculation of such average the rates bid by such deposit
dealers for such purchase of certificates of deposit of (i) the CD Reference
Bank receiving the lowest average bid rates from such deposit dealers and (ii)
the CD Reference Bank receiving the highest average bid rates from such deposit
dealers.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves)
28
<PAGE>
for a member bank of the Federal Reserve System in New York City with deposits
exceeding five billion dollars in respect of new non-personal time deposits in
dollars in New York City having a maturity comparable to the related Interest
Period and in an amount of $100,000 or more. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any change in the
Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in
effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. SECTION 327.3(d) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's) insuring time deposits at offices of such institution in the United
States. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during each Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for such
day plus the Adjusted London Interbank Offered Rate applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than three months, three months
after the first day thereof.
"Euro-Dollar Margin" means (i) .175% per annum for any day on which
Level I Status exists, (ii) .250% per annum for any day on which Level II Status
exists, (iii) .275% per annum for any day on which Level III Status exists, (iv)
.3125% per annum for any day on which Level IV Status exists, (v) .325% for any
day on which Level V Status exists and (vi) .400% for any day on which Level VI
Status exists. The basis and determination of any Status shall be subject to
Section 1.04.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100 of 1%) by dividing (i) the
applicable London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar
Reserve Percentage.
29
<PAGE>
The "London Interbank Offered Rate" applicable to any Interest Period
means the average (rounded upward, if necessary, to the next higher 1/100 of 1%)
of the respective rates per annum at which deposits in dollars are offered to
each of the Euro-Dollar Reference Banks in the London interbank market at
approximately 11:00 A.M. (London time) two Euro-Dollar Business Days before the
first day of such Interest Period in an amount approximately equal to the
principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank to
which such Interest Period is to apply and for a period of time comparable to
such Interest Period, excluding from the calculation of such average the rate at
which such deposits are offered to (i) the Euro-Dollar Reference Bank offered
the lowest such rate and (ii) the Euro-Dollar Reference Bank offered the highest
such rate.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the Euro-Dollar
Reserve Percentage.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the date of actual payment, at a rate
per annum equal to the sum of 2% plus (i) if principal of or interest on such
Euro-Dollar Loan shall have become overdue during an Interest Period applicable
to such Euro-dollar Loan, for each such day before the last day of such Interest
Period, the sum of the Euro-Dollar Margin plus the Adjusted London Interbank
Offered Rate applicable to such Loan for such Interest Period, and (ii) for the
last day of such Interest Period and each day thereafter, the Euro-Dollar Margin
plus the quotient obtained (rounded upward, if necessary, to the next higher
1/100 of 1%) by dividing (x) the average (rounded upward, if necessary, to the
next higher 1/100 of 1%) of the respective rates per annum at which one day (or,
if such amount due remains unpaid more
30
<PAGE>
than three Euro-Dollar Business Days, then for such other period of time not
longer than six months as the Agent may select) deposits in dollars in an amount
approximately equal to such overdue payment due to each of the Euro-Dollar
Reference Banks are offered to such Euro-Dollar Reference Bank in the London
interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Dollar Reserve Percentage (or, if the circumstances
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per annum
equal to the sum of 2% plus the Base Rate for such day).
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the sum of the London
Interbank Offered Rate for such Interest Period (determined in accordance with
Section 2.07(c) as if the related Money Market LIBOR Borrowing were a Committed
Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted by the
Bank making such Loan in accordance with Section 2.03. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.03. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day from and including the date payment thereof was due to
but excluding the date of actual payment, at a rate per annum equal to the sum
of 2% plus the Base Rate for such day.
(f) The Agent shall determine each interest rate applicable to the
Loans hereunder. The Agent shall give prompt notice to the Borrower and the
participating Banks of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(g) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Agent as contemplated by this Section. If any Reference Bank
does not furnish a timely quotation, the Agent shall determine the relevant
interest rate on the basis of the quotation or quotations furnished by the
remaining Reference Bank or Banks or, if none of such quotations is available on
a timely basis, the provisions of Section 8.01 shall apply.
31
<PAGE>
SECTION 2.08. FEES. (a) FACILITY FEE. The Borrower shall pay to
the Agent for the account of the Banks ratably a facility fee at the Facility
Fee Rate. Such facility fee shall accrue each day (i) from and including
December 9, 1993 to but excluding the Termination Date (or earlier date of
termination of the Commitments in their entirety), on the aggregate amount of
the Commitments (whether used or unused) on such date, and (ii) from and
including the Termination Date (or such earlier date) to but excluding the Final
Fee Payment Date, on the sum of (i) the aggregate outstanding principal amount
of the Loans plus (ii) the aggregate amount of the Letter of Credit Liabilities,
in each case on such date. Accrued fees under this subsection shall be payable
on each Quarterly Date, on the Termination Date and on the Final Fee Payment
Date.
"Facility Fee Rate" means (i) .125% per annum for any day on which
Level I Status, Level II Status or Level III Status exists, (ii) .1875% per
annum for any day on which Level IV Status exists, (iii) .225% per annum for any
day on which Level V Status exists and (iv) .250% per annum for any day on which
Level VI Status exists. The basis and determination of any Status shall be
subject to Section 1.04.
"Final Fee Payment Date" means the latest of (i) the date on which the
Loans shall be repaid in their entirety, (ii) the date on which all Letters of
Credit shall have terminated, (iii) the date on which no drawings shall be
available under any Letter of Credit and (iv) the date on which all
Reimbursement Obligations shall be paid in full.
(b) ADVISORY FEES. The Borrower shall pay to each Co-Arranger
advisory fees (i) on the Effective Date, in the amount previously agreed upon
between such Co-Arranger and the Borrower and (ii) on the Sell-Down Date, in the
amount previously agreed upon between such Co-Arranger and the Borrower.
(c) SYNDICATION FEES. The Borrower shall pay to each Co-Agent and
Co-Arranger syndication fees (i) prior to the Effective Date, on the date and in
the amount previously agreed upon between the Borrower and such Co-Agent or Co-
Arranger, as the case may be, and (ii) on the Sell-Down Date, in the amount
specified in the Term Sheet to be paid to such Co-Agent or Co-Arranger, as the
case may be, upon commencement of Phase II (as defined in the Term Sheet).
32
<PAGE>
SECTION 2.09. OPTIONAL TERMINATION OR REDUCTION OF COMMITMENTS. The
Borrower may, upon at least three Domestic Business Days' notice to the Agent,
(i) terminate the Commitments at any time, if no Loans are outstanding and no
Letter of Credit Liabilities exist at such time or (ii) ratably reduce from time
to time by an aggregate amount of $25,000,000 or any larger multiple of
$1,000,000, the aggregate amount of the Commitments in excess of the sum of (x)
the aggregate outstanding principal amount of the Loans and (y) the aggregate
amount of Letter of Credit Liabilities at such time in respect of all Letters of
Credit.
SECTION 2.10. OPTIONAL PREPAYMENTS. (a) The Borrower may, upon at
least one Domestic Business Day's notice to the Agent, prepay a Group of Base
Rate Loans (or any Money Market Borrowing bearing interest at the Base Rate
pursuant to Section 8.01(a)) in whole at any time, or from time to time in part
in amounts aggregating $25,000,000 or any larger multiple of $1,000,000, by
paying the principal amount to be prepaid together with accrued interest thereon
to the date of prepayment. Each such optional prepayment shall be applied to
prepay ratably the Loans of the several Banks included in such Group or
Borrowing.
(b) The Borrower may, upon at least three Domestic Business Days'
notice to the Agent, in the case of a Group of CD Loans, or upon at least three
Euro-Dollar Business Days' notice to the Agent, in the case of a Group of
Euro-Dollar Loans, prepay the Loans comprising such Group in whole at any time,
or from time to time in part in amounts aggregating $25,000,000 or any larger
multiple of $1,000,000, by paying the principal amount to be prepaid together
with accrued interest thereon to the date of prepayment; PROVIDED that the
Borrower shall reimburse each Bank for any loss or expense incurred by it as a
result of any such prepayment in accordance with Section 2.13. Each such
optional prepayment shall be applied to prepay ratably the Loans of the several
Banks included in such Group.
(c) Except as provided in subsection (a) above, the Borrower may not
prepay all or any portion of the principal amount of any Money Market Loan prior
to the maturity thereof.
(d) Upon receipt of a notice of prepayment pursuant to this Section,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such prepayment (if any) and such notice shall not
thereafter be revocable by the Borrower.
33
<PAGE>
SECTION 2.11. METHOD OF ELECTING INTEREST RATES. (a) The Loans
included in each Committed Borrowing shall bear interest initially at the type
of rate specified by the Borrower in the applicable Notice of Borrowing.
Thereafter, the Borrower may from time to time elect to change or continue the
type of interest rate borne by each Group of Loans (subject in each case to the
provisions of Article VIII), as follows:
(i) if such Loans are Base Rate Loans, the Borrower may elect to
convert such Loans to CD Loans as of any Domestic Business Day or to
Euro-Dollar Loans as of any Euro-Dollar Business Day;
(ii) if such Loans are CD Loans, the Borrower may elect to convert
such Loans to Base Rate Loans or Euro-Dollar Loans or elect to continue
such Loans as CD Loans for an additional Interest Period, in each case
effective on the last day of the then current Interest Period applicable to
such Loans;
(iii) if such Loans are Euro-Dollar Loans, the Borrower may elect to
convert such Loans to Base Rate Loans or CD Loans or elect to continue such
Loans as Euro-Dollar Loans for an additional Interest Period, in each case
effective on the last day of the then current Interest Period applicable to
such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Agent not later than 11:00 A.M. (New York City time) (x)
if the relevant Loans are to be converted to Domestic Loans or continued as
Domestic Loans for an additional Interest Period, the second Domestic Business
Day before such conversion or continuation is to be effective and (y) if the
relevant Loans are to be converted to Euro-Dollar Loans or continued as
Euro-Dollar Loans for an additional Interest Period, the third Euro-Dollar
Business Day before such conversion or continuation is to be effective. A
Notice of Interest Rate Election may, if it so specifies, apply to only a
portion of the aggregate principal amount of the relevant Group of Loans;
PROVIDED that (i) such portion is allocated ratably among the Loans comprising
such Group and (ii) the portion to which such Notice applies, and the remaining
portion to which it does not apply, are each $25,000,000 or any larger multiple
of $1,000,000.
(b) Each Notice of Interest Rate Election shall specify:
34
<PAGE>
(i) the Group of Loans (or portion thereof) to which such notice
applies,
(ii) the date on which the conversion or continuation selected in such
notice is to be effective, which shall comply with the applicable clause of
subsection (a) above,
(iii) if the Loans comprising such Group are to be converted, the new
type of Loans and, if such new Loans are Fixed Rate Loans, the duration of
the initial Interest Period applicable thereto, and
(iv) if such Loans are to be continued as CD Loans or Euro-Dollar
Loans for an additional Interest Period, the duration of such additional
Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period. The number of
Groups of Loans outstanding at any one time shall not exceed the lesser of (i)
thirty and (ii) the number obtained by dividing the aggregate amount of the
Commitments at such time by $25,000,000 (rounded upward, if necessary, to the
next higher integer).
(c) Upon receipt of a Notice of Interest Rate Election from the
Borrower pursuant to subsection (a) above, the Agent shall promptly notify each
Bank of the contents thereof and such notice shall not thereafter be revocable
by the Borrower. If the Borrower fails to deliver a timely Notice of Interest
Rate Election to the Agent for any Group of Fixed Rate Loans, such Loans shall
be converted into Base Rate Loans on the last day of the then current Interest
Period applicable thereto.
SECTION 2.12. GENERAL PROVISIONS AS TO PAYMENTS. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 12:00 Noon (New York City time) on the date when due,
in Federal or other funds immediately available in New York City, to the Agent
at its address referred to in Section 9.01. The Agent will promptly distribute
to each Bank its ratable share of each such payment received by the Agent for
the account of the Banks. Whenever any payment of principal of, or interest on,
the Domestic Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a
35
<PAGE>
day which is not a Euro-Dollar Business Day, the date for payment thereof shall
be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business Day.
Whenever any payment of principal of, or interest on, the Money Market Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day. If the date for any payment of principal is extended by operation of law
or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Banks hereunder that the
Borrower will not make such payment in full, the Agent may assume that the
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Bank on
such due date an amount equal to the amount then due such Bank. If and to the
extent that the Borrower shall not have so made such payment, each Bank shall
repay to the Agent forthwith on demand such amount distributed to such Bank
together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Agent, at the Federal Funds Rate.
SECTION 2.13. FUNDING LOSSES. If the Borrower makes any payment of
principal with respect to any Fixed Rate Loan or any Fixed Rate Loan is
converted to a Base Rate Loan (pursuant to Article II, VI or VIII or otherwise)
on any day other than the last day of an Interest Period applicable thereto, or
the end of an applicable period fixed pursuant to Section 2.07(d), or if the
Borrower fails to borrow or prepay any Fixed Rate Loans after notice has been
given to any Bank in accordance with Section 2.04(a) or 2.10(d), the Borrower
shall reimburse each Bank within 15 days after demand for any resulting loss or
expense incurred by it (or, subject to Section 9.06(e), by an existing or
prospective Participant in the related Loan), including (without limitation) any
loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after any such payment or
conversion or failure to borrow or prepay, PROVIDED that such Bank shall have
delivered to the Borrower a certificate setting forth in reasonable detail its
calculation of the amount of such loss or expense, which certificate shall be
conclusive in the absence of manifest error.
36
<PAGE>
SECTION 2.14. COMPUTATION OF INTEREST AND FEES. Interest based on
the Prime Rate hereunder shall be computed on the basis of a year of 365 days
(or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. LETTERS OF CREDIT. (a) COMMITMENT TO ISSUE LETTERS OF
CREDIT. During the Credit Availability Period, the Banks severally agree, upon
the terms and conditions hereinafter set forth, to issue letters of credit
hereunder, ratably in proportion to their respective Commitments, from time to
time upon the request of the Borrower (letters of credit so issued, the "Letters
of Credit", and each a "Letter of Credit"); PROVIDED that, immediately after
each Letter of Credit is issued, (i) the sum of each Bank's outstanding LC
Exposure plus the aggregate principal amount of Committed Loans by such Bank
shall not exceed the amount of its Commitment and (ii) the aggregate amount of
the Letter of Credit Liabilities shall not exceed the Available LC Amount.
(b) NOTICE OF ISSUANCE. The Borrower shall give the Agent
irrevocable notice (i) at least five Domestic Business Days prior to the
requested issuance of a Letter of Credit, if the form of such Letter of Credit
has not been previously agreed upon by the Borrower and the Banks, and (ii) at
least three Domestic Business Days prior to the requested issuance of a Letter
of Credit, if the form of such Letter of Credit has been previously agreed upon
by the Borrower and the Banks, in each case specifying the date such
Letter of Credit is to be issued, and describing the proposed terms of such
Letter of Credit, including the face amount thereof (if not specified in the
form of such Letter of Credit, if any), and the nature of the transactions
proposed to be supported thereby (such notice, a "Notice of Issuance"). Upon
receipt of any Notice of Issuance, the Agent (i) shall promptly notify each Bank
of the contents thereof and of the amount of such Bank's ratable share of such
proposed Letter of Credit and (ii) shall prepare and send to the Borrower and
the Lenders a proposed form or the form, as the case may be, of such Letter of
Credit. The terms of each such Letter of Credit shall provide that each Bank is
obligated, severally and not jointly, to pay any drawings under such Letter of
Credit ratably in proportion to such Bank's Commitment as in effect on the date
such
37
<PAGE>
Letter of Credit is issued. The issuance by the Banks of each Letter of
Credit shall, in addition to the conditions precedent set forth in Article III,
be subject to the conditions precedent that (i) such Letter of Credit shall (x)
have a minimum aggregate face amount of $25,000,000 and (y) be in such form and
contain such terms as shall be reasonably satisfactory to the Banks, (ii) the
Borrower shall have, or shall have caused such other Persons to have, executed
and delivered such other instruments and agreements relating to such Letter of
Credit as any of the Banks shall have reasonably requested, (iii) such Letter of
Credit shall be used only for the purpose of staying directly or indirectly the
execution of any judgment entered by the Court in the Action and (iv) such
Letter of Credit shall be issued only to a beneficiary designated by the Court
or to one or more bonding companies accepted by the Court that issue surety
bonds in favor of such beneficiary. No Letter of Credit shall have a term
extending beyond the Termination Date.
(c) FEES. The Borrower agrees to pay to the Agent for the account of
each Bank in respect of each Letter of Credit, ratably in proportion to its
respective share of such Letter of Credit, a letter of credit fee with respect
to such Letter of Credit, computed for each day from and including the date of
issuance of such Letter of Credit until the date no drawings are available on
such Letter of Credit, at the LC Commission Rate on the undrawn amount of such
Letter of Credit on such day. Such fee shall be payable in arrears on each
Quarterly Date for so long as such Letter of Credit is outstanding and on the
date no drawings are available on such Letter of Credit.
"LC Commission Rate" means (i) .175% per annum for any day on which
Level I Status exists, (ii) .250% per annum for any day on which Level II Status
exists, (iii) .275% per annum for any day on which Level III Status exists, (iv)
.3125% per annum for any day on which Level IV Status exists, (v) .325% per
annum for any day on which Level V Status exists and (vi) .400% per annum for
any day on which Level VI Status exists. The basis and determination of any
Status shall be subject to Section 1.04.
(d) DRAWINGS UNDER THE LETTER OF CREDIT. Upon receipt from the
beneficiary of any Letter of Credit of a demand for payment under such Letter of
Credit, the Agent shall determine in accordance with the terms and conditions of
such Letter of Credit whether such demand for payment should be honored. If the
Agent determines that a demand for payment by such beneficiary should be honored
in
38
<PAGE>
accordance with the terms and conditions set forth in such Letter of Credit, the
Agent shall promptly notify the Borrower and each Bank of the aggregate amount
to be paid as a result of such demand and shall promptly notify each Bank of its
share of such amount. Upon receipt of such notice, each Bank shall make
available to such beneficiary its share of the amount so demanded in accordance
with the terms of such Letter of Credit.
(e) REIMBURSEMENT OBLIGATION. If any Bank pays any portion of any
draft presented under any Letter of Credit, the Borrower agrees to pay to such
Bank (x) on the date the Agent notifies the Borrower of such payment, if such
notice is given at or before 10 A.M. (New York City time), or (y) if such notice
is given after 10 A.M. (New York City time) then not later than 1:00 P.M. (New
York City time) on the Domestic Business Day next succeeding the date such
notice is given (the "Reimbursement Due Date") an amount equal to the amount
paid by such Bank under such Letter of Credit (a "Reimbursable Amount"),
together with interest thereon from and including the date of such payment by
such Bank to but excluding the Reimbursement Due Date at a rate per annum equal
to the Base Rate for such day. If any Reimbursable Amount is not paid on the
relevant Reimbursement Due Date, the overdue amount shall bear interest for each
day from and including the Reimbursement Due Date to but excluding the date of
actual payment at a rate per annum equal to the sum of 2% plus the Base Rate for
such day. The Borrower shall be irrevocably and unconditionally obligated
forthwith to reimburse each Bank for any Reimbursable Amount paid by such Bank
upon any drawing under any Letter of Credit, without presentment, demand,
protest or other formalities of any kind.
(f) OBLIGATIONS. The obligations of the Borrower under this Section
2.15 shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement, under all circumstances
whatsoever, including without limitation the following circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit or any document related thereto;
(ii) any amendment or waiver of or any consent to departure from
all or any of the provisions of any Letter of Credit or any document
related thereto;
39
<PAGE>
(iii) the use which may be made of any Letter of Credit by, or any
acts or omission of, the beneficiary of such Letter of Credit (or any
Person for whom such the beneficiary may be acting);
(iv) the existence of any claim, set-off, defense or other rights
that the Borrower may have at any time against the beneficiary of a
Letter of Credit (or any Person for whom such beneficiary may be
acting), the Banks or any other Person, whether in connection with
this Agreement or any Letter of Credit or any document related hereto
or thereto or any unrelated transaction;
(v) any statement or any other document presented under a Letter
of Credit proving to be forged, fraudulent or invalid in any respect
or any statement therein being untrue or inaccurate in any respect
whatsoever;
(vi) payment under any Letter of Credit against presentation to
the Agent of a draft or certificate that does not comply with the
terms of such Letter of Credit, PROVIDED that the Agent's
determination that documents presented under such Letter of Credit
comply with the terms thereof shall not have constituted gross
negligence or willful misconduct of the Agent; or
(vii) any other act or omission to act or delay of any kind by any
Bank, the Agent or any other Person or any other event or circumstance
whatsoever that might, but for the provisions of this subsection (f),
constitute a legal or equitable discharge of the Borrower's
obligations hereunder.
(g) INDEMNIFICATION. The Borrower hereby indemnifies and holds
harmless each Bank and the Agent from and against any and all claims, damages,
losses, liabilities, costs or expenses which such Bank or the Agent may incur
(or which may be claimed against such Bank or the Agent by any Person
whatsoever), by reason of or in connection with the execution and delivery or
transfer of or payment or failure to pay under any Letter of Credit; PROVIDED
that the Borrower shall not be required to indemnify any Bank or the Agent for
any claims, damages, losses, liabilities, costs or expenses, to the extent
caused by (x) the willful misconduct or gross negligence of the
40
<PAGE>
Agent in determining whether a request presented under any Letter of Credit
complied with the terms of such Letter of Credit or (y) such Bank's failure to
pay under any Letter of Credit after receipt of notice from the Agent pursuant
to Section 2.15(b) after the presentation to the Agent by the beneficiary of
such Letter of Credit of documents strictly complying with the terms and
conditions of such Letter of Credit. Nothing in this subsection (g) is intended
to limit the obligations of the Borrower under any other provision of this
Agreement, including the Borrower's reimbursement obligation contained in
Section 2.15(e).
(h) LIMITED LIABILITY OF THE AGENT AND THE BANKS. The Agent, the
Banks and their respective officers, directors, employees and agents shall not
be liable or responsible for, and the obligations of the Borrower to reimburse
the Banks for payments under this Agreement shall not be excused by, any action
or inaction of the Agent or any Bank related to: (w) the use which may be made
of any Letter of Credit or any acts or omissions of the beneficiary of such
Letter of Credit in connection therewith; (x) the validity or genuineness of
documents presented under any Letter of Credit, even if such documents should in
fact prove to be in any or all respects invalid, fraudulent or forged; (y)
payment by any Bank against presentation of documents to the Agent which do not
comply with the terms of any Letter of Credit, including failure of any document
to bear any reference or adequate reference to such Letter of Credit; or (z) any
other circumstances whatsoever in making or failing to make payment under any
Letter of Credit, or notifying or failing to notify any Bank that is required to
make any payment under any Letter of Credit. Notwithstanding the foregoing, the
Borrower shall, in the case of clause (i) of this sentence, have a claim against
the Agent and, in the case of clause (ii) of this sentence, against any Bank,
and the Agent or such Bank, as the case may be, 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 which were caused by (i) the
Agent's willful misconduct or gross negligence in determining whether documents
presented under any Letter of Credit comply with the terms thereof or in failing
to notify any Bank in accordance with Section 2.15(d) or in accordance with the
terms of any Letter of Credit or (ii) such Bank's failure to pay, after receipt
of notice from the Agent pursuant to Section 2.15(b), under any Letter of Credit
after the presentation to the Agent by the beneficiary of such Letter of Credit
of documents strictly complying with the terms and conditions of such Letter of
Credit. In furtherance and not in limitation of the
41
<PAGE>
foregoing, the Agent may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary.
(i) OBLIGATIONS SEVERAL. The obligations of each Bank hereunder and
under any Letter of Credit are several but not joint. Failure of any Bank to
carry out its obligations hereunder and under any Letter of Credit shall not
relieve any other Bank, the Agent or the Borrower of any of their respective
obligations hereunder or under such Letter of Credit. Neither the Agent nor any
Bank shall be responsible for the obligations of any other party hereunder.
ARTICLE III
CONDITIONS
SECTION 3.01. CLOSING. The Closing hereunder shall occur upon
receipt by the Agent of the following documents, each dated the Closing Date
unless otherwise indicated:
(a) a duly executed Note for the account of each Bank dated on or
before the Closing Date, complying with the provisions of Section 2.05;
(b) a certificate signed on behalf of the Borrower by a vice
president and the secretary of the Borrower stating that (i) on the Closing
Date, no Default has occurred and is continuing and (ii) the
representations and warranties of the Borrower contained in this Agreement
are true on and as of the Closing Date;
(c) opinions of Skadden, Arps, Slate, Meagher & Flom, special counsel
for the Borrower, substantially in the form of Exhibit E hereto, and of the
General Counsel of the Borrower, substantially in the form of Exhibit F
hereto, and each covering such additional matters relating to the
transactions contemplated hereby as the Required Banks may reasonably
request;
(d) an opinion of Davis Polk & Wardwell, special counsel for the
Agent, substantially in the form of Exhibit G hereto and covering such
additional matters relating to the transactions contemplated hereby as the
Required Banks may reasonably request; and
42
<PAGE>
(e) all documents the Agent may reasonably request relating to the
existence of the Borrower, the corporate authority for and the validity of
this Agreement, the Notes or any related document, and any other matters
relevant hereto, all in form and substance reasonably satisfactory to the
Agent.
The Agent shall promptly notify the Borrower and the Banks of the Closing Date,
and such notice shall be conclusive and binding on all parties hereto.
SECTION 3.02. EACH CREDIT EVENT. The obligations of any Bank to make
a Loan on the occasion of any Borrowing and to issue a Letter of Credit on the
occasion of any request therefor by the Borrower are subject to the satisfaction
of the following conditions:
(a) the fact that the Closing Date shall have occurred;
(b) receipt (or deemed receipt) by the Agent of a Notice of Borrowing
as required by Section 2.02 or 2.03, or a Notice of Issuance as required by
Section 2.15, as the case may be;
(c) the fact that, immediately after such Credit Event, the sum of
(i) the aggregate outstanding principal amount of the Loans plus (ii) the
aggregate outstanding amount of Letter of Credit Liabilities will not
exceed the aggregate amount of the Commitments;
(d) the fact that, immediately before and after such Credit Event, no
Default shall have occurred and be continuing;
(e) the fact that the representations and warranties of the Borrower
contained in this Agreement (except (i) the representations set forth in
Sections 4.04(c) and 4.11(b) and (ii) the representations and warranties
set forth in Sections 4.05 and 4.07 as to any matter which has theretofore
been disclosed in writing by the Borrower to the Banks) shall be true on
and as of the date of such Credit Event;
43
<PAGE>
(f) the fact that, on the date of such Credit Event, the total amount
of the Judgment shall not exceed $1,200,000,000;
(g) the fact that, on the date of such Credit Event, the sum of the
total amount of the Judgment plus the total amount of Interest and Costs
theretofore accrued shall not exceed $1,800,000,000;
(h) the fact that, on the date of such Credit Event, the sum (without
duplication to the extent one supports another) of (x) the aggregate face
amount of all supersedeas bonds and letters of credit plus (y) the value of
all other collateral as determined by the Court or as stipulated by the
Borrower and the Claimant and accepted by the Court (or, to the extent no
such determination or stipulation is made with respect to such other
collateral, the fair market value of such other collateral), in each case
required by the Court to be posted for purposes of staying the execution of
the Judgment, shall not exceed $1,800,000,000;
(i) the fact that, on the date of such Credit Event, the amount of
any Settlement shall not exceed $1,800,000,000;
(j) receipt by the Agent of evidence reasonably satisfactory to it of
the Judgment or a Settlement; and
(k) in the case of the initial Credit Event, (i) the fact that the
Sell-Down Date shall have occurred at least five Domestic Business Days
prior to the date of the initial Credit Event and (ii) receipt by the
Agent, for the account of each of the Co-Arrangers and the Co-Agents, of
the fees payable to the Co-Arrangers and the Co-Agents on or before the
date of the initial Credit Event.
Each Credit Event hereunder shall be deemed to be a representation and warranty
by the Borrower on the date of such Credit Event as to the facts specified in
clauses (c) through (i), inclusive, of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. CORPORATE EXISTENCE AND POWER. The Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all corporate powers and all material
44
<PAGE>
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.02. CORPORATE AND GOVERNMENTAL AUTHORIZATION; NO
CONTRAVENTION. The execution, delivery and performance by the Borrower of this
Agreement and the Notes are within the Borrower's corporate power, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do not
contravene, or constitute a default under, any provision of applicable law or
regulation or of the restated certificate of incorporation or bylaws of the
Borrower or of any material agreement, judgment, injunction, order, decree or
other instrument binding upon the Borrower or any of its Subsidiaries or result
in the creation or imposition of any Lien on any asset of the Borrower or any of
its Subsidiaries.
SECTION 4.03. BINDING EFFECT. This Agreement constitutes a valid and
binding agreement of the Borrower, and the Notes, when executed and delivered in
accordance with by this Agreement, will constitute valid and binding obligations
of the Borrower.
SECTION 4.04. FINANCIAL INFORMATION.
(a) The consolidated statement of financial position of the Borrower
and its Consolidated Subsidiaries as of December 31, 1992 and the related
consolidated statements of income and of cash flows for the fiscal year then
ended, reported on by Deloitte & Touche and set forth in the Borrower's 1992
Form 10-K, a copy of which has been delivered to each of the Banks, fairly
present, in all material respects, in conformity with generally accepted
accounting principles, the consolidated financial position of the Borrower and
its Consolidated Subsidiaries as of such date and their consolidated results of
operations and cash flows for such fiscal year.
(b) The unaudited consolidated statement of financial position of the
Borrower and its Consolidated Subsidiaries as of October 3, 1993 and the related
unaudited consolidated statements of income and of cash flows for the three
quarters then ended, set forth in the Borrower's quarterly report for the fiscal
quarter ended October 3, 1993 as filed with the Securities and Exchange
Commission on Form 10-Q, a copy of which has been delivered to each of the
Banks, fairly present, in conformity with generally accepted
45
<PAGE>
accounting principles applied on a basis consistent with the financial
statements referred to in subsection (a) of this Section, the consolidated
financial position of the Borrower and its Consolidated Subsidiaries as of
such date and their consolidated results of operations and cash flows for such
period of three quarters (subject to normal year-end adjustments).
(c) Since December 31, 1992 there has been no material adverse change
in the business, financial position, results of operations or prospects of the
Borrower and its Consolidated Subsidiaries, considered as a whole; PROVIDED that
the verdict rendered by the jury in the Action and the entry by the Court, and
the payment by the Borrower, of the Judgment or any Settlement shall not, in and
of themselves, constitute such a material adverse change.
SECTION 4.05. LITIGATION. There is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official (i) in which there is a
reasonable possibility of an adverse decision which could reasonably be expected
to have a Material Adverse Effect, except for the Action or (ii) which in any
manner draws into question the validity of this Agreement or the Notes.
SECTION 4.06. COMPLIANCE WITH ERISA; MINIMUM FUNDING. (a) Each
member of the ERISA Group has fulfilled its obligations under the minimum
funding standards of ERISA and the Internal Revenue Code with respect to each
Plan and is in compliance in all material respects with the presently applicable
provisions of ERISA and the Internal Revenue Code with respect to each Plan,
except where the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect. No member of the ERISA Group has (i) sought a
waiver of the minimum funding standard under Section 412 of the Internal Revenue
Code in respect of any Plan, (ii) failed to make any contribution or payment to
any Plan or Multiemployer Plan or in respect of any Benefit Arrangement, or made
any amendment to any Plan or Benefit Arrangement, which failure or amendment has
resulted or could result in the imposition of a Lien or the posting of a bond or
other security under ERISA or the Internal Revenue Code or (iii) incurred any
liability under Title IV of ERISA other than a liability to the PBGC for
premiums or similar items under Section 4007 of ERISA.
46
<PAGE>
(b) As of September 30 of each fiscal year of the Borrower, the fair
market value of all assets, in the aggregate, of all Plans maintained or
contributed to by any member of the ERISA Group (excluding any accrued but
unpaid contributions) shall not be less than 80% of the accumulated benefit
obligation for such Plans, calculated on the basis of the actuarial assumptions
used by the Borrower for financial reporting purposes for such fiscal year.
SECTION 4.07. ENVIRONMENTAL MATTERS. In the ordinary course of its
business, the Borrower conducts an ongoing review of the aggregate effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, capital or
operating expenditures required for clean-up or closure of properties presently
or previously owned, capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or as
a condition of licenses, permits or contracts, related constraints on operating
activities, including periodic or permanent shutdowns of facilities or
reductions in the level of or changes in the nature of operations conducted
thereat, costs or liabilities in connection with off-site disposal of wastes or
Hazardous Substances, and any actual or potential liabilities to third parties,
including employees, and any related costs and expenses). On the basis of this
review, the Borrower has reasonably concluded that such associated liabilities
and costs, including the costs of compliance with Environmental Laws, are
unlikely to have a Material Adverse Effect.
SECTION 4.08. TAXES. United States Federal income tax returns of the
Borrower and its Subsidiaries have been examined and closed through the fiscal
year ended December 31, 1979. The Borrower and each of its Subsidiaries have
filed all United States Federal income tax returns and all other material tax
returns which are required to be filed by any of them and have paid all taxes
due pursuant to such returns or pursuant to any assessment received by any of
them, except for any such taxes which are being contested in good faith and for
which adequate reserves have been made on the books of the Borrower and its
Subsidiaries in accordance with generally accepted accounting principles. The
charges, accruals and reserves on the books of the Borrower and its Subsidiaries
in respect of income taxes are, in the opinion of the Borrower, adequate in
accordance with generally accepted accounting principles.
47
<PAGE>
SECTION 4.09. SUBSIDIARIES. Each corporate Subsidiary of the
Borrower is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
SECTION 4.10. NOT AN INVESTMENT COMPANY. The Borrower is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
SECTION 4.11. FULL DISCLOSURE. (a) All oral information relating to
the Action and all written information (taken as a whole) heretofore furnished
by or on behalf of the Borrower to the Agent, either Co-Arranger or any Bank for
purposes of or in connection with this Agreement or any transaction contemplated
hereby is, and all such information (taken as a whole) hereafter furnished by
the Borrower to the Agent, either Co-Arranger or any Bank will be, true and
accurate in all material respects on the date as of which such information is
stated or certified.
(b) The Borrower has disclosed to the Banks in writing any and all
facts which materially and adversely affect or could reasonably be expected to
materially and adversely affect (to the extent the Borrower can now reasonably
foresee), the business, operations or financial condition of the Borrower and
its Consolidated Subsidiaries, taken as a whole (to the extent the Borrower is
required to publicly disclose such information under the federal securities
laws), or the ability of the Borrower to perform its obligations under this
Agreement.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid or any Letter of
Credit Liability remains outstanding:
SECTION 5.01. INFORMATION. The Borrower will deliver to each of the
Banks:
48
<PAGE>
(a) as soon as available and in any event within 100 days after the
end of each fiscal year of the Borrower, a consolidated statement of
financial position of the Borrower and its Consolidated Subsidiaries as of
the end of such fiscal year and the related consolidated statements of
income and cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all reported on
in a manner acceptable to the Securities and Exchange Commission by
Deloitte & Touche or other independent public accountants of nationally
recognized standing;
(b) as soon as available and in any event within 50 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Borrower, a consolidated statement of financial position of the Borrower
and its Consolidated Subsidiaries as of the end of such quarter and the
related consolidated statements of income and cash flows for such quarter
and for the portion of the Borrower's fiscal year ended at the end of such
fiscal quarter, setting forth in the case of such in comparative form the
figures for the corresponding quarter and the corresponding portion of the
Borrower's previous fiscal year, all certified (subject to normal year-end
adjustments) as to fairness of presentation, generally accepted accounting
principles and consistency by the chief financial officer or the chief
accounting officer of the Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate of the
chief financial officer, the treasurer or the chief accounting officer of
the Borrower (i) setting forth in reasonable detail the calculations
required to establish whether the Borrower was in compliance with the
requirements of Sections 5.07 to 5.09, inclusive, on the date of such
financial statements and (ii) stating whether, to the best of such person's
knowledge after due inquiry, any Default exists on the date of such
certificate and, if any Default then exists, setting forth the details
thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements (i)
49
<PAGE>
whether anything has come to their attention to cause them to believe that any
Default existed on the date of such statements and (ii) confirming the
calculations set forth in the officer's certificate delivered simultaneously
therewith pursuant to clause (c) above;
(e) within five Domestic Business Days after any executive officer of
the Borrower obtains knowledge of any Default, if such Default is then
continuing, a certificate of the chief financial officer, the treasurer or
the chief accounting officer of the Borrower setting forth the details
thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(f) promptly upon the mailing thereof to the stockholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements
on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or
their equivalents) which the Borrower shall have filed with the Securities
and Exchange Commission;
(h) within ten Domestic Business Days after any member of the ERISA
Group (i) gives or is required to give notice to the PBGC of any
"reportable event" (as defined in Section 4043 of ERISA) with respect to
any Plan which could reasonably be expected to constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any
such reportable event, a copy of the notice of such reportable event given
or a description of the reportable event for which notice was required to
be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any
Multiemployer Plan is in reorganization, is insolvent or has been
terminated, a copy of such notice; (iii) receives notice from the PBGC
under Title IV of ERISA of an intent to terminate, impose liability (other
than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a
waiver of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent to
50
<PAGE>
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice
and other information filed with the PBGC; (vi) gives notice of withdrawal
from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement (or makes any
amendment to any Plan or Benefit Arrangement) which failure to contribute
or amendment has resulted or could reasonably be expected to result in the
imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer or the chief accounting officer
of the Borrower setting forth details as to such occurrence and action, if
any, which the Borrower or applicable member of the ERISA Group is
required or proposes to take;
(i) promptly after any executive officer of the Borrower obtains
knowledge of any actual or proposed change by Moody's or S&P of the rating
of the Borrower's outstanding senior unsecured long-term debt securities,
notice of such actual or proposed change;
(j) promptly upon the entry of any judgment by the Court in the
Action, any affirmance of any appeal of such judgment, or any other
material development in the Action which the Borrower is required by law to
disclose publicly, notice of such entry, affirmance or other material
development, as the case may be; and
(k) from time to time such additional information regarding the
Action or the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Bank, may reasonably
request.
SECTION 5.02. PAYMENT OF OBLIGATIONS. The Borrower will pay and
discharge, and will cause each Subsidiary to pay and discharge, at or before
maturity, all their respective material obligations and liabilities, including,
without limitation, tax liabilities, except where (i) the same may be contested
in good faith by appropriate proceedings or (ii) the failure to pay or discharge
such obligations and liabilities could not reasonably be expected to have a
Material Adverse Effect, and will maintain, and will cause each Subsidiary to
maintain, in accordance with generally accepted accounting principles (or, with
respect to any Subsidiary organized under the laws of any jurisdiction other
than the United States, in accordance with (x) accounting principles applicable
in such
51
<PAGE>
jurisdiction and (y) and, in the case of any Consolidated Subsidiary, accounting
principles adequate for the inclusion of the results of operations of such
Subsidiary in the consolidated financial statements of the Borrower and its
Subsidiaries), appropriate reserves for the accrual of any of the same.
SECTION 5.03. MAINTENANCE OF PROPERTY; INSURANCE. (a) The Borrower
will keep, and will cause each Subsidiary to keep, all property useful and
necessary in its business in good working order and condition, ordinary wear and
tear excepted, except where the failure to keep such property in good working
order and condition could not reasonably be expected to have a Material Adverse
Effect.
(b) The Borrower will, and will cause each of its Subsidiaries to,
provide as self-insurer to the extent provided below, or maintain (either in the
name of the Borrower or in such Subsidiary's own name) with financially sound
and responsible insurance companies, insurance on all their respective
properties in at least such amounts and against at least such risks (and with
such risk retention and such amounts of self-insurance) as are usually insured
against in the same general area by companies of established repute engaged in
the same or a similar business; and will furnish to the Banks, upon request from
the Agent, information presented in reasonable detail as to the insurance so
carried.
SECTION 5.04. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. The
Borrower will continue, and will cause each Subsidiary to continue, to engage in
business of the same general type as now conducted by the Borrower and its
Subsidiaries, and will preserve, renew and keep in full force and effect, and
will cause each Subsidiary to preserve, renew and keep in full force and effect
their respective corporate existence and their respective rights, privileges and
franchises necessary or desirable in the normal conduct of business, except for
any such rights, privileges and franchises the failure of which to be preserved
could not reasonably be expected to have a Material Adverse Effect; PROVIDED
that nothing in this Section 5.04 shall prohibit (i) the merger of a Subsidiary
into the Borrower or the merger or consolidation of a Subsidiary with or into
another Person if the corporation surviving such consolidation or merger is a
Subsidiary and if, in each case, after giving effect thereto, no Default shall
have occurred and be continuing, (ii) the termination of the corporate existence
of any Subsidiary or the discontinuation of any line of business of the Borrower
or
52
<PAGE>
any Subsidiary if the Borrower in good faith determines that such termination or
discontinuation, as the case may be, is in the best interest of the Borrower and
is not materially disadvantageous to the Banks, (iii) the acquisition of new
Subsidiaries by Borrower or any Subsidiary or the addition of any new line of
business of the Borrower or any Subsidiary or (iv) the sale of any assets of the
Borrower or any Subsidiary.
SECTION 5.05. COMPLIANCE WITH LAWS. The Borrower will comply, and
cause each Subsidiary to comply, in all material respects with all applicable
laws, ordinances, rules, regulations, and requirements of governmental
authorities (including, without limitation, Environmental Laws and ERISA and the
rules and regulations thereunder) except (i) where the necessity of compliance
therewith is contested in good faith by appropriate proceedings and (ii) in the
case of Environmental Laws and ERISA and the rules and regulations thereunder,
where the failure to be in compliance therewith could not reasonably be expected
to have a Material Adverse Effect.
SECTION 5.06. INSPECTION OF PROPERTY, BOOKS AND RECORDS. The
Borrower will keep, and will cause each Subsidiary to keep, proper books of
record and account in which full, true and correct entries shall be made of all
dealings and transactions in relation to its business and activities; and,
except to the extent prohibited by applicable law, rule, regulations or orders,
will permit, and will cause each Subsidiary to permit, representatives of any
Bank at such Bank's expense to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, employees and independent public accountants, all at
such reasonable times and as often as may reasonably be desired.
SECTION 5.07. MINIMUM CONSOLIDATED ADJUSTED NET WORTH. Consolidated
Adjusted Net Worth shall not, at any date, be less than the sum of (i)
$500,000,000 plus (ii) an amount equal to 25% of Consolidated Net Income (if
positive) for each fiscal quarter of the Borrower, commencing with the fiscal
quarter ending March 31, 1994 ("Minimum Consolidated Adjusted Net Worth");
PROVIDED that if Consolidated Net Income for any fiscal quarter of the Borrower
is negative (such negative amount, a "Loss Amount"), Minimum Consolidated
Adjusted Net Worth shall be increased at the end of the subsequent fiscal
quarter of the Borrower by an amount equal to 25% of the amount, if any, by
which
53
<PAGE>
Consolidated Net Income (if positive) for such subsequent fiscal quarter exceeds
such Loss Amount.
SECTION 5.08. CONSOLIDATED CASH FLOW TO CONSOLIDATED INDEBTEDNESS. If
at any date Level IV Status, Level V Status or Level VI Status exists, the ratio
of Consolidated Cash Flow for the four consecutive fiscal quarters of the
Borrower then most recently ended (taken as one accounting period) to
Consolidated Indebtedness at such date shall not be less than .25 to 1.0. The
basis and determination of any Status shall be subject to Section 1.04.
SECTION 5.09. CONSOLIDATED INDEBTEDNESS TO CONSOLIDATED TOTAL
CAPITAL. If on or after the Settlement Date, Level V Status or Level VI Status
exists at any date, the ratio of Consolidated Indebtedness to Consolidated Total
Capital, each determined as of such date, shall not be greater than (i) .90 to
1.0, if such date occurs during the period from and including the Settlement
Date to but excluding the first anniversary thereof, (ii) .75 to 1.0, if such
date occurs during the period from and including the first anniversary of the
Settlement Date to but excluding the second anniversary of the Settlement Date,
(iii) .65 to 1.0, if such date occurs during the period from and including the
second anniversary of the Settlement Date to but excluding the third anniversary
of the Settlement Date, and (iv) .55 to 1.0, if such date occurs on or after the
third anniversary of the Settlement Date. The basis and determination of any
Status shall be subject to Section 1.04.
SECTION 5.10. NEGATIVE PLEDGE. Neither the Borrower nor any
Consolidated Domestic Subsidiary will create or assume any Lien on any
Restricted Asset now or hereafter owned by the Borrower or any Consolidated
Domestic Subsidiary securing any Debt, unless provision is made to secure
equally and ratably all Loans and Reimbursement Obligations then outstanding or
thereafter made to or owed by the Borrower, together with any other amounts then
or thereafter owed by the Borrower hereunder, with such secured Debt or
obligations, so long as such secured Debt shall be so secured, except:
(a) any Lien on any Restricted Asset securing Debt owed to a
governmental entity;
(b) any Lien on any Restricted Asset created for the sole purpose of
extending, renewing or replacing, in whole or in part, the Debt secured by
any existing
54
<PAGE>
Lien which was not created in violation of this Section, if the principal amount
of Debt secured thereby shall not exceed the principal amount of Debt so secured
at the time of such extension, renewal or replacement and such Lien shall be
limited to all or a part of the Restricted Assets which secured the Debt so
extended, renewed or replaced (plus improvements on or to any such Restricted
Assets and, if the Borrower shall so determine, any additional assets, Liens on
which are not restricted by this Section);
(c) any Lien existing on any Restricted Asset in connection with the
acquisition thereof; and
(d) any Lien on any Restricted Asset acquired, constructed or
improved after the date hereof, including any improvements thereon;
PROVIDED that (i) such Lien is created contemporaneously with such
acquisition, construction or improvement or within one hundred twenty
(120) days before the commencement thereof or after the completion
thereof, to secure or provide for the payment of an amount not
exceeding the cost of such acquisition, construction or improvement
(including related expenditures capitalized for federal income tax
purposes in connection therewith) incurred after the date hereof, but
only if, in the case of such construction or improvement, the Lien
shall not extend to any property other than that on or connected to
property on which the construction or improvement is located.
SECTION 5.11. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.
(a) The Borrower shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person unless:
(1) the Person formed by such consolidation or into which the
Borrower is merged (if the Borrower is not the surviving corporation) or
the Person which acquires by conveyance or transfer, or which leases, the
properties and assets of the Borrower substantially as an entirety shall be
a corporation, partnership or trust, shall be organized and validly
existing under the laws of the United States, any State thereof or the
District of Columbia and shall expressly assume, by an instrument of
assumption, executed and delivered to the Agent, in form satisfactory to
the Agent, the due and
55
<PAGE>
punctual payment of the principal of and interest on the Notes and Reimbursement
Obligations and the performance or observance of every covenant of this
Agreement on the part of the Borrower to be performed or observed;
(2) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing; and
(3) the Borrower shall have delivered to the Agent a certificate
executed by the Chairman of the Board, the President or a Vice President of
the Borrower and by the Treasurer or the Secretary of the Borrower and a
written opinion of counsel (who may be counsel for the Borrower), each
stating that such consolidation, merger, conveyance, transfer or lease and,
if an instrument of assumption is required in connection with such
transaction, such an instrument of assumption, comply with this Section and
that all conditions precedent herein provided for relating to such
transaction have been complied with.
(b) Upon any consolidation of the Borrower with, or merger by the
Borrower into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Borrower substantially as an entirety in accordance
with this Section, the successor Person formed by such consolidation or into
which the Borrower is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Borrower under this Agreement with the same effect as if such
successor Person had been named as the Borrower herein, and thereafter, except
in the case of a lease, the predecessor Person shall be relieved of all
obligations and covenants under this Agreement and the Notes.
SECTION 5.12. USE OF PROCEEDS. The proceeds of the Loans made under
this Agreement will be used by the Borrower solely for purposes of (i) staying
directly or indirectly execution of the Judgment and/or any judgment for
Interest and Costs, (ii) providing for the payment when due of the Judgment, any
Interest and Costs or any Settlement and (iii) paying any Reimbursement
Obligations. None of such proceeds will be used, directly or indirectly, for
the purpose, whether immediate, incidental or ultimate, of buying or carrying
any "margin stock" within the meaning of Regulation U.
56
<PAGE>
ARTICLE VI
DEFAULTS
SECTION 6.01. EVENTS OF DEFAULT. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when due, or shall fail to pay within three
Domestic Business Days after the due date thereof any interest on any Note
or Reimbursement Obligation or any fees or any other amount payable
hereunder;
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.07 to 5.12, inclusive;
(c) the Borrower shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those covered by clause
(a) or (b) above) for 30 days after written notice thereof has been given
to the Borrower by the Agent at the request of any Bank;
(d) any representation, warranty, certification or statement made by
the Borrower in this Agreement or in any certificate, financial statement
or other document delivered pursuant to this Agreement shall prove to have
been incorrect in any material respect when made (or deemed made);
(e) the Borrower or any Subsidiary shall fail to make any payment in
respect of any Material Debt when due or within any applicable grace
period;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables the holder of
such Debt or any Person acting on such holder's behalf to accelerate the
maturity thereof;
(g) the Borrower or any Subsidiary (other than any Abandoned
Subsidiary) shall commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or its
debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator,
57
<PAGE>
custodian or other similar official of it or any substantial part of its
property, or shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the benefit of
creditors, or shall fail generally to pay its debts as they become due, or shall
take any corporate action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary (other than any Abandoned
Subsidiary) seeking liquidation, reorganization or other relief with
respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days;
or an order for relief shall be entered against the Borrower or any
Subsidiary (other than any Abandoned Subsidiary) under the federal
bankruptcy laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an
amount or amounts aggregating in excess of $50,000,000 which it shall have
become liable to pay under Title IV of ERISA in connection with a Plan or a
Multiemployer Plan; or notice of intent to terminate a Material Plan under
a distress termination within the meaning of Section 4041(c) of ERISA shall
be filed under Title IV of ERISA by any member of the ERISA Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA) in respect
of, or to cause a trustee to be appointed to administer any Material Plan;
or a condition specified in Section 4042(a) of ERISA shall exist by reason
of which the PBGC would be entitled to obtain a decree adjudicating that
any Material Plan must be terminated; or there shall occur a complete or
partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current
payment obligation in excess of $50,000,000;
58
<PAGE>
(j) a judgment or order for the payment of money in an amount in
excess of the greater of (x) $100,000,000 and (y) 10% of Consolidated
Adjusted Net Worth determined as of the end of the then most recently ended
fiscal quarter of the Borrower and such judgment or order shall continue
unsatisfied and unstayed for a period of 30 days; or
(k) any person or group of persons (within the meaning of Section 13
or 14 of the Securities Exchange Act of 1934, as amended) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated
by the Securities and Exchange Commission under said Act) of 20% or more of
the outstanding shares of common stock of the Borrower; or, during any
period of twelve consecutive calendar months, individuals (i) who were
directors of the Borrower on the first day of such period or (ii) whose
nomination for election to the board of directors of the Borrower was
recommended or approved by a vote of at least a majority of the directors
then still in office who were directors of the Borrower on the first day of
such period, shall cease to constitute a majority of the board of directors
of the Borrower;
then, and in every such event, the Agent shall (i) if requested by Banks having
more than 50% in aggregate amount of the Commitments, by notice to the Borrower
terminate the Commitments and they shall thereupon terminate, and (ii) if
requested by Banks holding Notes evidencing more than 50% in aggregate
principal amount of the Loans, by notice to the Borrower declare the Notes
(together with accrued interest thereon) to be, and the Notes shall thereupon
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower;
PROVIDED that in the case of any of the Events of Default specified in clause
(g) or (h) above with respect to the Borrower, without any notice to the
Borrower or any other act by the Agent or the Banks, the Commitments shall
thereupon terminate and the Notes (together with accrued interest thereon)
shall become immediately due and payable without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower.
SECTION 6.02. CASH COVER. The Borrower hereby agrees, in addition to
the provisions of Section 6.01 hereof, that upon the occurrence and during the
continuance of any Event of Default, it shall, if requested by the Agent upon
instruction of Banks having more than 50% in aggregate
59
<PAGE>
amount of the Letter of Credit Liabilities, pay to the Agent an amount in
immediately available funds equal to the then aggregate amount available for
drawings under all Letters of Credit at the time outstanding (the "Aggregate LC
Amount"); PROVIDED that, upon the occurrence of any Event of Default specified
in clauses (g) and (h) of Section 6.01 with respect to the Borrower, the
Borrower shall be obligated forthwith to pay such amount without any notice or
demand or any other act by the Agent or the Banks.
The Aggregate LC Amount, when received by the Agent, shall be held by
the Agent in a collateral account maintained with the Agent (the "Collateral
Account"), which account (and all investments held therein) shall be held in
name of and subject to the dominion and control of the Agent on behalf of the
Banks, as cash collateral for the Reimbursement Obligations of the Borrower in
the event of any drawing under any Letter of Credit. Upon any drawing under any
Letter of Credit, the Agent shall apply such amounts held in the Collateral
Account to the Reimbursement Obligations in respect of such Letter of Credit.
The Borrower hereby grants to the Agent, for the benefit of the Banks,
a security interest in and right of set-off against any and all of the funds and
investments held in the Collateral Account from time to time and any instrument
evidencing the foregoing, and the proceeds thereof and the right to receive
interest, dividends and other income therefrom, to secure equally and ratably
the obligations of the Borrower hereunder in respect of the Letters of Credit
and the Reimbursement Obligations. The Agent, on behalf of the Banks, shall
have the rights, powers and remedies of a secured party under the New York
Uniform Commercial Code with respect to the funds and investments held in the
Collateral Account from time to time. The Agent shall exercise such rights,
powers and remedies as and when requested by Banks having more than 50% in
aggregate amount of the aggregate Letter of Credit Liabilities from time to
time; PROVIDED that the Agent shall not be obligated to take any action which it
believes to be contrary to law or inconsistent with the equal and ratable nature
of the security interest provided in this paragraph. The Agent's duties under
this paragraph (as well as under all other provisions of this Agreement) are
subject to the provisions of Article VII. The Borrower shall take such actions
from time to time as the Agent (at the request of any Bank) may reasonably
request to perfect and preserve the security interests provided for in this
paragraph.
60
<PAGE>
The Agent shall invest funds held in the Collateral Account from time
to time only in direct obligations of the United States or any agency thereof,
or obligations guaranteed by the United States or any agency thereof (in each
case maturing within 90 days from the date of acquisition thereof by the Agent)
designated by the Borrower; PROVIDED that the Agent is authorized to sell
investments held in the Collateral Account when and as required to make payments
out of the Collateral Account as herein provided.
Upon the date on which all Letters of Credit have terminated and
drawings are no longer available thereunder, and the payment in full of all
secured obligations, the Agent shall release all funds and investments held in
the Collateral Account to or upon the order of the Borrower (or as a court of
competent jurisdiction may otherwise direct).
SECTION 6.03. NOTICE OF DEFAULT. The Agent shall give notice to the
Borrower under Section 6.01(c) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. APPOINTMENT AND AUTHORIZATION. Each Bank irrevocably
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement, the Notes and the Letters of
Credit as are delegated to the Agent by the terms hereof or thereof, together
with all such powers as are reasonably incidental thereto.
SECTION 7.02. THE AGENT AND AFFILIATES. Morgan Guaranty Trust
Company of New York shall have the same rights and powers under this Agreement
as any other Bank and may exercise or refrain from exercising the same as though
it were not the Agent, and Morgan Guaranty Trust Company of New York and its
affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any of its Subsidiaries or affiliates of
the Borrower as if it were not the Agent hereunder.
SECTION 7.03. ACTION BY THE AGENT. The obligations of the Agent
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any
61
<PAGE>
action with respect to any Default, except as expressly provided in Article VI.
SECTION 7.04. CONSULTATION WITH EXPERTS. The Agent may consult with
legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.05. LIABILITY OF THE AGENT. Neither the Agent nor any of
its affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in connection
herewith (i) with the consent or at the request of the Required Banks or (ii) in
the absence of its own gross negligence or willful misconduct. Neither the
Agent nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with this Agreement or any Credit Event hereunder; (ii) the
performance or observance of any of the covenants or agreements of the Borrower;
(iii) the satisfaction of any condition specified in Article III, except receipt
of items required to be delivered to the Agent; or (iv) the validity,
effectiveness or genuineness of this Agreement, the Notes or any other
instrument or writing furnished in connection herewith. The Agent shall not
incur any liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex or similar writing)
believed by it to be genuine or to be signed by the proper party or parties.
SECTION 7.06. INDEMNIFICATION. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitees' gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection with this
Agreement or any action taken or omitted by such indemnitees hereunder.
SECTION 7.07. CREDIT DECISION. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and based
on such
62
<PAGE>
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Bank also acknowledges
that it will, independently and without reliance upon the Agent or any other
Bank, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
any action under this Agreement.
SECTION 7.08. SUCCESSOR AGENT. The Agent may resign at any time by
giving written notice thereof to the Banks and the Borrower. Upon any such
resignation, the Required Banks shall have the right, with the consent of the
Borrower, to appoint a successor Agent; PROVIDED that the Borrower's consent to
any such appointment shall not unreasonably be withheld, but may in any event be
withheld if both (i) such proposed successor Agent fails to deliver evidence
reasonably satisfactory to the Borrower that such proposed successor Agent is
not a Foreign Person and (ii) the Borrower in good faith concludes that the
appointment of such proposed successor Agent could result in a violation of any
law, rule, guideline or regulation, or a violation of, revocation of, failure to
renew or modification of any, order, facility security clearance or permit. If
no successor Agent shall have been so appointed by the Required Banks, and shall
have accepted such appointment, within 30 days after the retiring Agent gives
notice of resignation, then the retiring Agent may, on behalf of the Banks,
appoint a successor Agent, which shall (i) be a commercial bank organized or
licensed under the laws of the United States of America or of any State thereof,
(ii) not be a Foreign Person and (iii) have a combined capital and surplus of at
least $50,000,000. Upon the acceptance of its appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this Article
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent.
SECTION 7.09. AGENT'S FEE. The Borrower shall pay to the Agent for
its own account fees in the amounts and at the times previously agreed upon
between the Borrower and the Agent.
SECTION 7.10 CO-AGENTS NOT LIABLE. Nothing in this Agreement
shall impose upon any Co-Agent, in such capacity, any duties or responsibilities
whatsoever.
63
<PAGE>
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR
UNFAIR. If on or prior to the first day of any Interest Period for any CD Loan,
Euro-Dollar Loan or Money Market LIBOR Loan:
(a) the Agent is advised by the Reference Banks that deposits in
dollars (in the applicable amounts) are not being offered to the Reference
Banks in the relevant market for such Interest Period, or
(b) in the case of CD Loans or Euro-Dollar Loans, Banks having 50% or
more of the aggregate principal amount of the affected Loans advise the
Agent that the Adjusted CD Rate or the Adjusted London Interbank Offered
Rate, as the case may be, as determined by the Agent will not adequately
and fairly reflect the cost to such Banks of funding their CD Loans or
Euro-Dollar Loans, as the case may be, for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, (i) the obligations of the Banks to
make CD Loans or Euro-Dollar Loans, as the case may be, or to convert
outstanding Loans into CD Loans or Euro-Dollar Loans, as the case may be, shall
be suspended and (ii) each outstanding CD Loan or Euro-Dollar Loan, as the case
may be, shall be converted into a Base Rate Loan on the last day of the then
current Interest Period applicable thereto. Unless the Borrower notifies the
Agent at least two Domestic Business Days before the date of any Fixed Rate
Borrowing for which a Notice of Borrowing has previously been given that it
elects not to borrow on such date, (i) if such Fixed Rate Borrowing is a
Committed Borrowing, such Borrowing shall instead be made as a Base Rate
Borrowing and (ii) if such Fixed Rate Borrowing is a Money Market LIBOR
Borrowing, the Money Market LIBOR Loans comprising such Borrowing shall bear
interest for each day from and including the first day to but excluding the last
day of the Interest Period applicable thereto at the Base Rate for such day.
SECTION 8.02. ILLEGALITY. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in
64
<PAGE>
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Euro-Dollar Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall make it unlawful
or impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain
or fund its Euro-Dollar Loans and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make Euro-Dollar Loans, or to convert outstanding Loans into
Euro-Dollar Loans, shall be suspended. Before giving any notice to the Agent
pursuant to this Section, such Bank shall designate a different Euro-Dollar
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Bank, be otherwise disadvantageous to such
Bank. If such notice is given, each Euro-Dollar Loan of such Bank then
outstanding shall be converted to a Base Rate Loan either (a) on the last day of
the then current Interest Period applicable to such Euro-Dollar Loan if such
Bank may lawfully continue to maintain and fund such Loan to such day or (b)
immediately if such Bank shall determine that it may not lawfully continue to
maintain and fund such Loan to such day.
SECTION 8.03. INCREASED COST AND REDUCED RETURN. (a) If on or after
(x) the date hereof, in the case of any Committed Loan or any obligation to make
a Committed Loan or issue Letters of Credit or (y) the date of the related Money
Market Quote, in the case of any Money Market Loan, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall impose, modify or deem
applicable any reserve (including, without limitation, any such requirement
imposed by the Board of Governors of the Federal Reserve System, but excluding
(i) with respect to any CD Loan any such requirement included in an applicable
Domestic Reserve Percentage and (ii) with respect to any Euro-Dollar Loan any
such requirement included in an applicable Euro-Dollar Reserve Percentage),
special deposit, insurance assessment
65
<PAGE>
(excluding, with respect to any CD Loan, any such requirement reflected in an
applicable Assessment Rate) or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any Bank (or its Applicable
Lending Office) or shall impose on any Bank (or its Applicable Lending Office)
or on the United States market for certificates of deposit or the London
interbank market any other condition affecting its Fixed Rate Loans, its Note or
its obligation to make Fixed Rate Loans, the Letters of Credit issued by it or
its obligation to issue Letters of Credit (collectively, its "Covered Credits")
and the result of any of the foregoing is to increase the cost to such Bank (or
its Applicable Lending Office) (excluding any Taxes, Other Taxes and Excluded
Taxes (as each such term is defined in Section 8.04)) of making or maintaining
any Covered Credit, or to reduce the amount of any sum received or receivable by
such Bank (or its Applicable Lending Office) under this Agreement or under its
Note with respect thereto, by an amount deemed by such Bank to be material,
then, within 15 days after demand by such Bank (with a copy to the Agent)
accompanied by a certificate setting forth in reasonable detail its calculation
of such increased cost or reduction, the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.
(b) If any Bank shall have determined that, after the date hereof,
the adoption of any applicable law, rule, guideline or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or any request
or directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency (collectively, a
"Change in Law"), has or would have the effect of reducing the rate of return on
capital of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below that which such Bank (or its Parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Bank to be material, then from time to time, within 15 days after demand
by such Bank (with a copy to the Agent) accompanied by a certificate setting
forth in reasonable detail its calculation of such reduction, the Borrower shall
pay to such Bank such additional amount or amounts as will compensate such Bank
(or its Parent) for such reduction; PROVIDED that to the extent that (i) a Bank
shall increase its level of capital
66
<PAGE>
above the level maintained by such Bank on the date of this Agreement and there
has not been a Change in Law or (ii) there has been a Change in Law and a Bank
shall increase its level of capital by an amount greater than the increase
attributable (taking into consideration the same variables taken into
consideration in determining the level of capital maintained by such Bank on the
date of this Agreement) to such Change in Law, the Borrower shall not be
required to pay any amount or amounts under this Agreement with respect to any
such increase in capital. Thus, for example, a Bank which is "adequately
capitalized" (as such term or any similar term is used by any applicable bank
regulatory agency having authority with respect to such Bank) may not require
the Borrower to make payments in respect of increases in such Bank's level of
capital made under the circumstances described in clause (i) or (ii) above which
improve its capital position from "adequately capitalized" to "well capitalized"
(as such term or any similar term is used by any applicable bank regulatory
agency having authority with respect to such Bank).
(c) Each Bank will promptly notify the Borrower and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Applicable Lending Office if such designation will avoid the need for,
or reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth in reasonable detail
its calculation of the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
Notwithstanding the foregoing subsections (a) and (b) of this Section 8.03, the
Borrower shall only be obligated to compensate any Bank for any amount arising
or accruing during (i) any time or period commencing not more than (x) in the
case of subsection (a), six months and (y) in the case of subsection (b), three
months, prior to the date on which such Bank notifies the Agent and the Borrower
that it proposes to demand such compensation and identifies to the Agent and the
Borrower the statute, regulation or other basis upon which the claimed
compensation is or will be based and (ii) any time or period during which,
because of the retroactive application of such statute, regulation or other
basis, such Bank did not know that such amount would arise or accrue.
67
<PAGE>
SECTION 8.04. TAXES. (a) Any and all payments by the Borrower to or
for the account of any Bank or the Agent hereunder or under any Note shall be
made free and clear of and without deduction for any and all present or future
taxes, duties, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, EXCLUDING, in the case of each Bank and the
Agent, taxes imposed on its income, branch profits taxes and franchise or
similar taxes imposed on it, by the jurisdiction (or any political subdivision
thereof) under the laws of which such Bank or the Agent (as the case may be) is
organized or has its principal office and, in the case of each Bank, taxes
imposed on its income, branch profit taxes and franchise or similar taxes
imposed on it, by the jurisdiction of such Bank's Applicable Lending Office or
any political subdivision thereof (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings and liabilities being herein referred
to as "Taxes" and all such excluded taxes being herein referred to as "Excluded
Taxes"). If the Borrower shall be required by law to deduct any Taxes from or
in respect of any sum payable hereunder or under any Note to any Bank or the
Agent, (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section 8.04) such Bank or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law and (iv) the Borrower shall
furnish to the Agent, at its address referred to in Section 9.01, the original
or a certified copy of a receipt evidencing payment thereof. Upon the
reasonable request of the Borrower, each Bank agrees to promptly and diligently
pursue at the expense of the Borrower any available refund of any such Taxes and
Other Taxes (as defined in subsection (b) below) and to promptly remit
immediately available funds to the Borrower in an amount equal to any such
refund (including any interest thereon received by such Bank from the applicable
taxing authority).
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any Note or
from the execution or delivery of, or otherwise with respect to, this Agreement,
any Note or any Letter of Credit (hereinafter referred to as "Other Taxes").
68
<PAGE>
(c) The Borrower agrees to indemnify each Bank and the Agent for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section 8.04) paid by such Bank or the Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto. This indemnification shall be made within 30 days from the
date such Bank or the Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Bank listed on the signature pages hereof and on
or prior to the date on which it becomes a Bank in the case of each other Bank,
and from time to time thereafter if requested in writing by the Borrower (but
only so long as such Bank remains lawfully able to do so), shall provide the
Borrower with two duly completed copies of Internal Revenue Service form 1001 or
4224, as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Bank is entitled to benefits under an income tax
treaty to which the United States is a party which reduces the rate of
withholding tax on payments of interest or certifying that the income receivable
pursuant to this Agreement is effectively connected with the conduct of a trade
or business in the United States. If the form provided by a Bank at the time
such Bank first becomes a party to this Agreement indicates a United States
interest withholding tax rate in excess of zero, withholding tax at such rate
shall be considered excluded from "Taxes" as defined in Section 8.04(a). Each
such Bank that so delivers a form 1001 or 4224 (or applicable successor forms)
agrees to deliver to the Borrower updated or modified forms, or other manner of
certification acceptable to the Borrower, at any time that any such form is
required to be resubmitted or modified, as a result of any action taken by such
Bank, as a condition to obtaining an exemption from withholding tax.
(e) For any period with respect to which a Bank has failed to provide
the Borrower with the appropriate form pursuant to Section 8.04(d) (unless such
failure is due to a change in treaty, law or regulation occurring subsequent to
the date on which a form originally was required to be provided), such Bank
shall not be entitled to indemnification under Section 8.04(a) with respect to
Taxes. Should a Bank, which is otherwise exempt from or subject to a reduced
rate of withholding tax, become subject to Taxes because of its failure to
deliver a form required hereunder,
69
<PAGE>
the Borrower shall take such steps as such Bank shall reasonably request to
assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to or for
the account of any Bank pursuant to this Section 8.04, then such Bank will
change the jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such change,
in the judgment of such Bank, is not otherwise disadvantageous to such Bank.
SECTION 8.05. BASE RATE LOANS SUBSTITUTED FOR AFFECTED FIXED RATE
LOANS. If (i) the obligation of any Bank to make or maintain Euro-Dollar Loans
has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03 or 8.04 with respect to its CD Loans or
Euro-Dollar Loans and the Borrower shall, by at least five Euro-Dollar Business
Days' prior notice to such Bank through the Agent, have elected that the
provisions of this Section shall apply to such Bank, then, unless and until such
Bank notifies the Borrower that the circumstances giving rise to such suspension
or demand for compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as (or
continued as or converted into) CD Loans or Euro-Dollar Loans, as the case
may be, shall instead be Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Fixed Rate Loans of the
other Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case may
be, has been repaid (or converted to a Base Rate Loan), all payments of
principal which would otherwise be applied to repay such Fixed Rate Loans
shall be applied to repay its Base Rate Loans instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Base Rate Loan shall
be converted into a CD Loan or Euro-Dollar Loan, as the case may be, on the
first day of the next succeeding Interest Period applicable to the related CD
Loans or Euro-Dollar Loans of the other Banks.
SECTION 8.06. SUBSTITUTION OF BANK. If (i) the obligation of any
Bank to make Euro-Dollar Loans has been suspended pursuant to Section 8.02 or
(ii) any Bank has
70
<PAGE>
demanded compensation under Section 8.03 or 8.04, the Borrower shall have the
right, with the assistance of the Agent, to seek a substitute bank or banks
reasonably satisfactory to the Agent and the Borrower (which may be one or
more of the Banks) to purchase the Note and Letter of Credit Liabilities in
respect of unpaid Reimbursement Obligations and assume the Commitment and
contingent obligations with respect to undrawn amounts under outstanding
Letters of Credit of such Bank, if such substitution is not prohibited by the
terms of any outstanding Letter of Credit, and the Borrower, the Agent, such
Bank and substitute bank or banks shall execute and deliver an appropriately
completed Assignment and Assumption Agreement pursuant to Section 9.06(c)
hereof to effect the assignment of rights to and assumption of obligations by
such substitute bank or banks.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party: (x) in the case of the Borrower or the Agent, at its address, facsimile
number or telex number set forth on the signature pages hereof, (y) in the case
of any Bank, at its address, facsimile number or telex number set forth in its
Administrative Questionnaire or (z) in the case of any party, such other
address, facsimile number or telex number as such party may hereafter specify
for the purpose by notice to the Agent and the Borrower. Each such notice,
request or other communication shall be effective (i) if given by telex, when
such telex is transmitted to the telex number specified in this Section and the
appropriate answerback is received, (ii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, (iii) if given by facsimile transmission, when such
transmission is confirmed by telephone or (iv) if given by any other means, when
delivered at the address specified in this Section; PROVIDED that notices to the
Agent under Article II or Article VIII shall not be effective until received.
SECTION 9.02. NO WAIVERS. No failure or delay by the Agent or any
Bank in exercising any right, power or privilege hereunder or under any Note
shall operate as a waiver thereof nor shall any single or partial exercise
71
<PAGE>
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.03. EXPENSES; INDEMNIFICATION. (a) The Borrower shall pay
(i) all reasonable out-of-pocket expenses of the Agent, including reasonable
fees and disbursements of special counsel for the Agent, in connection with the
preparation of this Agreement, any Letter of Credit, any waiver or consent
hereunder or thereunder or any amendment hereof or thereof or any Default or
alleged Default hereunder and (ii) if an Event of Default occurs, all
out-of-pocket expenses incurred by the Agent and each Bank, including fees and
disbursements of counsel (including allocated costs of staff counsel), in
connection with such Event of Default and collection, bankruptcy, insolvency and
other enforcement proceedings resulting therefrom; PROVIDED that the foregoing
clauses (i) and (ii) shall exclude Taxes, Other Taxes and Excluded Taxes (as
each such term is defined in Section 8.04).
(b) The Borrower agrees to indemnify the Agent and each Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, but excluding Taxes, Other Taxes and Excluded Taxes,
which may be incurred by such Indemnitee in connection with any investigative,
administrative or judicial proceeding (whether or not such Indemnitee shall be
designated a party thereto) brought or threatened relating to or arising out of
this Agreement, any Letter of Credit, or any actual or proposed use of proceeds
of Loans hereunder or any actual or proposed use of any Letter of Credit;
PROVIDED that (i) no Indemnitee shall have the right to be indemnified hereunder
for any liabilities, losses, damages, costs or expenses arising out of or
resulting from such Indemnitee's own gross negligence or willful misconduct and
(ii) the Borrower shall not be liable for the cost of any settlement effected
without its consent, which consent shall not be unreasonably withheld. Each of
the Banks agrees to use reasonable efforts to notify the Borrower prior to
retaining any counsel or consultants, and to review with the Borrower the need
for, the circumstances of and compensation arrangements relating to any such
retention, with a view to controlling the cost to the Borrower thereof; PROVIDED
that
72
<PAGE>
the failure of any Bank to do so shall not affect the obligations of the
Borrower under this Section 9.03.
SECTION 9.04. SHARING OF SET-OFFS. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it and any Reimbursement Obligation owed to it
and interest (if any) thereon (collectively, the "Relevant Debt") which is
greater than the proportion received by any other Bank in respect of the
aggregate amount of the Relevant Debt of such other Bank, the Bank receiving
such proportionately greater payment shall purchase such participations in the
Relevant Debt of the other Banks, and such other adjustments shall be made, as
may be required so that all such payments of principal and interest with respect
to the Relevant Debt of the Banks shall be shared by the Banks pro rata;
PROVIDED that nothing in this Section shall impair the right of any Bank to
exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of the Borrower
other than its indebtedness under its Relevant Debt. The Borrower agrees, to
the fullest extent it may effectively do so under applicable law, that any
holder of a participation in a Note or a Letter of Credit, whether or not
acquired pursuant to the foregoing arrangements, may exercise rights of set-off
or counterclaim and other rights with respect to such participation as fully as
if such holder of a participation were a direct creditor of the Borrower in the
amount of such participation.
SECTION 9.05. AMENDMENTS AND WAIVERS. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of the Agent are affected thereby, by the Agent);
PROVIDED that no such amendment or waiver shall, unless signed by all the Banks,
(i) increase or decrease the Commitment of any Bank (except for a ratable
decrease in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan or any
Reimbursement Obligation or any fees hereunder, (iii) postpone the date fixed
for any scheduled payment of principal of or interest on any Loan or any
Reimbursement Obligation or any fees hereunder or for any termination of any
Commitment, (iv) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes or the aggregate amount of the Letter of
Credit Liabilities, or the number of Banks,
73
<PAGE>
which shall be required for the Banks or any of them to take any action under
this Section or any other provision of this Agreement or (v) amend any provision
of Sections 2.15(b)(iii) or 5.12.
SECTION 9.06. SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that the Borrower may not
assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of all Banks, except pursuant to and
in accordance with the terms of Section 5.11(b), and no Bank may assign or
otherwise transfer any of its rights or obligations under this Agreement except
in compliance with this Section 9.06.
(b) Any Bank may, at any time on or after the Sell-Down Date, grant
to one or more banks or other institutions (each a "Participant") participating
interests in its Commitment or any or all of its Loans or Letter of Credit
Liabilities. In the event of any such grant by a Bank of a participating
interest to a Participant, whether or not upon notice to the Borrower and the
Agent, such Bank shall remain responsible for the performance of its obligations
hereunder, and the Borrower and the Agent shall continue to deal solely and
directly with such Bank in connection with such Bank's rights and obligations
under this Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole right
and responsibility to enforce the obligations of the Borrower hereunder
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; PROVIDED that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause (i), (ii), (iii) or
(iv) of Section 9.05, without the consent of the Participant. Subject to
Section 9.06(e), the Borrower agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of Article
VIII with respect to its participating interest; PROVIDED that the Bank granting
such participating interest and such Participant comply with all duties and
obligations under Article VIII (as if, in the case of a Participant, it were a
Bank). An assignment or other transfer which is not permitted by subsection (c)
or (d) below shall be given effect for purposes of this Agreement only to the
extent of a participating interest granted in accordance with this subsection
(b).
74
<PAGE>
(c) Any Bank may, at any time on or after the Sell-Down Date, assign
to one or more banks or other institutions (each an "Assignee") all, or a
proportionate part (such portion to be in an amount equal to or greater than
$10,000,000) of all, of its rights and obligations under this Agreement, the
Notes and the Letters of Credit (provided that after giving effect to each such
assignment, such assigning Bank shall have retained a portion in an amount equal
to or greater than (i) in the case of any Bank that is not a Co-Agent or the
Agent on the Effective Date, $10,000,000, and (ii) in the case of any Bank that
is a Co-Agent or the Agent on the Effective Date, the lesser of (x) $30,000,000
and (y) 25% of such Bank's Commitment outstanding on the Effective Date (each
such amount, a "Minimum Hold Amount"); PROVIDED that if at any time the
aggregate amount of the Commitments shall be reduced, each Minimum Hold Amount
shall be reduced by the same percentage that the aggregate amount by which the
Commitments were reduced bears to the aggregate amount of the Commitments
immediately before such reduction), and such Assignee shall assume such rights
and obligations, pursuant to an Assignment and Assumption Agreement in
substantially the form of Exhibit H hereto executed by such Assignee and such
transferor Bank, with (and subject to) the subscribed consent of the Borrower
(which consent shall not unreasonably be withheld, but which may in any event be
withheld if both (i) such proposed Assignee fails to deliver evidence reasonably
satisfactory to the Borrower that such Assignee is not a Foreign Person and (ii)
the Borrower in good faith concludes that such assignment could result in a
violation of any law, rule or regulation, or a violation of, revocation of,
failure to renew or modification of any order, facility security clearance or
permit) and the consent of the Agent (which consent shall not be unreasonably
withheld); PROVIDED that if an Assignee is an Affiliate of such transferor Bank
and is not a Foreign Person and such assignment would not render any Letter of
Credit unacceptable to the Court or any beneficiary of such Letter of Credit, no
such consent shall be required; and PROVIDED FURTHER that such assignment may,
but need not, include rights of the transferor Bank in respect of outstanding
Money Market Loans; and PROVIDED FURTHER that (A) if a Bank has any contingent
obligations with respect to undrawn amounts under any Letters of Credit, such
Bank may assign its rights and obligations under this Agreement, the Notes and
the Letters of Credit pursuant to this subsection (c) only if the assignment of
such contingent obligations is permitted by the terms of such Letters of Credit
and (B) a Bank may assign its Commitment only to a Qualifying Bank (it being
understood that compliance with this clause (B) shall
75
<PAGE>
not eliminate the requirement of the Borrower's consent in accordance with this
subsection (c)).
"Qualifying Bank" means:
(i) a bank having (x) senior unsecured long-term debt securities,
long-term certificates of deposit or long-term letters of credit which are
rated A- or higher by S&P AND (y) senior unsecured long-term debt
securities, long-term bank deposits or long-term letters of credit which
are rated A3 or higher by Moody's, or
(ii) a bank (x) having (a) senior unsecured long-term debt securities
or long-term certificates of deposit rated A- or higher by S&P OR (b)
having senior unsecured long-term debt securities, long-term bank deposits
or long-term letters of credit rated A3 or higher by Moody's, (y) having no
long-term securities rated by the other rating agency and (z) having (A)
short-term certificates of deposit or short-term letters of credit which
are rated A1 or higher by S&P AND (B) short-term bank deposits or short-
term letters of credit which are rated P1 or higher by Moody's.
Upon execution and delivery of such instrument and payment by such Assignee to
such transferor Bank of an amount equal to the purchase price agreed between
such transferor Bank and such Assignee, such Assignee shall be a Bank party to
this Agreement and, subject to Section 9.06(e), shall have all the rights and
obligations of a Bank with a Commitment as set forth in such instrument of
assumption, and the transferor Bank shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this subsection (c), the transferor Bank, the Agent and the Borrower shall make
appropriate arrangements so that, if required, a new Note is issued to the
Assignee. In connection with any such assignment occurring after the earlier of
(i) the 90th date after the Sell-Down Date and (ii) the date as of which the
Agent has notified the Banks that general syndication has been completed, the
transferor Bank shall pay to the Agent an administrative fee for processing such
assignment in the amount of $2,500. If the Assignee is not incorporated under
the laws of the United States of America or a state thereof, it shall deliver to
the Borrower and the Agent certification as to exemption from deduction or
withholding of any United States federal income taxes in accordance with Section
8.04.
76
<PAGE>
(d) Any Bank may at any time assign all or any portion of its rights
under this Agreement and its Note to a Federal Reserve Bank. No such assignment
shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights
(and no Bank on behalf of any Assignee, Participant or other transferee) shall
be entitled to receive any greater payment under Article VIII or Section 2.13
(whether individually or in aggregate with any such payments received by such
Bank) than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the provisions of Section 8.02, 8.03 or 8.04
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances.
SECTION 9.07. COLLATERAL. Each of the Banks represents to the Agent
and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.08. GOVERNING LAW; SUBMISSION TO JURISDICTION. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
SECTION 9.09. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon receipt, on or prior to December 16,
1993, by the Agent of counterparts hereof signed by each of the parties hereto
77
<PAGE>
(or, in the case of any party as to which an executed counterpart shall not
have been received, receipt by the Agent in form satisfactory to it of
telegraphic, telex or other written confirmation from such party of execution
of a counterpart hereof by such party).
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT
AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
78
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
HONEYWELL INC.
By /s/ Michael A. Rocca
-----------------------------------
Title: Vice President and Treasurer
Honeywell Plaza
Minneapolis, MN 55408
Telex number:
Facsimile number:
Commitments
- -----------
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
$400,000,000 By /s/ Charles C. O'Brien
-----------------------------------
Title: Managing Director
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
$300,000,000 By /s/ Alexander H. Danzberger, Jr.
-----------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
$200,000,000 By /s/ Patricia DelGrande
-----------------------------------
Title: Vice President
THE FUJI BANK, LIMITED
$200,000,000 By /s/ Peter L. Chinnici
-----------------------------------
Title: Joint General Manager
79
<PAGE>
CITICORP USA, INC.
$100,000,000 By /s/ Robert M. Spence
-----------------------------------
Title: Vice President
Total
Commitments
- --------------
$1,200,000,000
- --------------
- --------------
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Administrative Agent
By /s/ Charles C. O'Brien
-----------------------------------
Title: Managing Director
60 Wall Street
New York, New York 10260
Attention: John O'Hara
Telex number: 177615
Facsimile number: (212) 648-5336
THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION), as Co-Agent
By /s/ Alexander H. Danzberger, Jr.
-----------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Co-Agent
By /s/ Patricia DelGrande
-----------------------------------
Title: Vice President
THE FUJI BANK, LIMITED, as Co-Agent
By /s/ Peter L. Chinnici
-----------------------------------
80
<PAGE>
Title: Joint General Manager
CITICORP USA, INC., as Co-Agent
By /s/ Robert M. Spence
-----------------------------------
Title: Vice President
81
