FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
Commission file number 1-924
TRINOVA CORPORATION
(Exact name of registrant as specified in its charter)
Ohio 34-4288310
(State of Incorporation) (I.R.S. Employer
Identification No.)
3000 Strayer, Maumee, OH 43537-0050
(Address of principal executive office)
Registrant's telephone number, including area code: (419) 867-2200
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
The number of Common Shares, $5 Par Value, outstanding as of October 31, 1994,
was 28,794,109.
This document, including exhibits, contains 114 pages.
The cover page consists of 1 page.
The Exhibit Index is located on page 17.
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
FORM 10-Q
FOR QUARTER ENDED SEPTEMBER 30, 1994
INDEX TO INFORMATION IN REPORT
TRINOVA CORPORATION
Page
Number
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Statement of Financial Position -
September 30, 1994 and December 31, 1993 3
Condensed Statement of Operations -
Three Months and Nine Months Ended
September 30, 1994 and 1993 4
Condensed Statement of Cash Flows -
Nine Months Ended September 30, 1994 and 1993 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 16
EXHIBIT INDEX 17
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS 20
EXHIBIT 27 - FINANCIAL DATA SCHEDULE 21
EXHIBIT 99(i)-2 - CREDIT AGREEMENT 22
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<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. - Financial Statements
<TABLE>
STATEMENT OF FINANCIAL POSITION
TRINOVA CORPORATION
(Dollars in thousands, except per share data)
<CAPTION>
September 30 December 31
1994 1993
---------- ----------
<S> <C> <C>
ASSETS (Unaudited)
CURRENT ASSETS
Cash $ 12,293 $ 20,534
Receivables 245,696 200,340
Inventories:
In-process and finished products 169,822 172,964
Raw materials and manufacturing supplies 44,110 39,382
---------- ----------
213,932 212,346
Other current assets 57,379 54,011
---------- ----------
TOTAL CURRENT ASSETS 529,300 487,231
Plants and properties 864,722 826,100
Less accumulated depreciation 482,733 439,281
---------- ----------
381,989 386,819
Other assets 89,246 98,151
---------- ----------
TOTAL ASSETS $1,000,535 $ 972,201
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 8,504 $ 60,539
Accounts payable 92,795 81,133
Income taxes 37,325 27,364
Other current liabilities 154,362 151,469
Current maturities of long-term debt 3,688 4,257
---------- ----------
TOTAL CURRENT LIABILITIES 296,674 324,762
Long-term debt 235,700 246,214
Postretirement benefits other than pensions 121,732 120,058
Deferred credits and other liabilities 27,466 22,558
Deferred income taxes 6,291 5,377
SHAREHOLDERS' EQUITY
Common stock; par value $5 a share
Authorized - 100,000,000 shares
Outstanding - 28,794,109 and 28,405,880 shares,
respectively (after deducting 5,415,787 and
5,804,016 shares, respectively, in treasury) 143,970 142,029
Additional paid-in capital 10,379 2,157
Retained earnings 171,699 138,628
Currency translation adjustments (13,376) (29,582)
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 312,672 253,232
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $1,000,535 $ 972,201
========== ==========
<FN>
The Notes to Financial Statements are an integral part of this statement.
</FN>
</TABLE>
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<PAGE>
CONDENSED STATEMENT OF OPERATIONS
TRINOVA CORPORATION
(In thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
------------------------ ------------------------
1994 1993 1994 1993
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net sales $ 437,587 $ 393,263 $1,338,281 $1,242,180
Cost of products sold 331,106 297,003 1,007,909 945,770
---------- ---------- ---------- ----------
MANUFACTURING INCOME 106,481 96,260 330,372 296,410
Selling and general admin. expenses 58,983 59,612 183,225 187,026
Engineering, research and development
expenses 13,775 13,431 41,541 42,224
Special charge - - - 26,000
---------- ---------- ---------- ----------
OPERATING INCOME 33,723 23,217 105,606 41,160
Interest expense (5,044) (6,347) (16,260) (19,806)
Other-net (5,448) (4,209) (15,917) (10,280)
---------- ---------- ---------- ----------
INCOME BEFORE INCOME TAXES AND
CUMULATIVE EFFECT OF ACCOUNTING
CHANGE 23,231 12,661 73,429 11,074
Income taxes 8,100 3,200 25,700 5,100
---------- ---------- ---------- ----------
INCOME BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE 15,131 9,461 47,729 5,974
Cumulative effect to January 1, 1993,
of accounting change, net of income
tax benefit - - - (70,229)
---------- ---------- ---------- ----------
NET INCOME (LOSS) $ 15,131 $ 9,461 $ 47,729 $ (64,255)
========== ========== ========== ==========
INCOME (LOSS) PER SHARE
Income before cumulative
effect of accounting change $ .52 $ .33 $ 1.64 $ .21
Cumulative effect of accounting
change, net of income tax benefit - - - (2.48)
---------- ---------- ---------- ----------
NET INCOME (LOSS) PER SHARE $ .52 $ .33 $ 1.64 $ (2.27)
========== ========== ========== ==========
Cash dividends per common share $ .17 $ .17 $ .51 $ .51
========== ========== ========== ==========
Average shares outstanding 30,903 28,434 30,823 28,367
========== ========== ========== ==========
<FN>
The Notes to Financial Statements are an integral part of this statement.
</FN>
</TABLE>
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<PAGE>
CONDENSED STATEMENT OF CASH FLOWS
TRINOVA CORPORATION
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30
--------------------
1994 1993
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 47,729 $ (64,255)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Cumulative effect of accounting change net
of income tax benefit - 70,229
Special charge - 26,000
Depreciation 45,498 46,183
Changes in working capital elements,
other than debt 1,790 10,868
Restructuring payments (4,909) (20,853)
Other 7,143 15,345
---------- ----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 97,251 83,517
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (37,892) (36,210)
Other 1,409 1,555
---------- ----------
NET CASH USED BY INVESTING ACTIVITIES (36,483) (34,655)
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in short-and long-term debt (62,680) (32,576)
Cash dividends (14,658) (14,430)
Stock issuance 10,163 1,623
---------- ----------
NET CASH USED BY FINANCING ACTIVITIES (67,175) (45,383)
Effect of exchange rate changes on cash (1,834) (4,865)
---------- ----------
DECREASE IN CASH (8,241) (1,386)
Cash at beginning of period 20,534 26,269
---------- ----------
CASH AT END OF PERIOD $ 12,293 $ 24,883
========== ==========
<FN>
The Notes to Financial Statements are an integral part of this statement.
</FN>
</TABLE>
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
TRINOVA CORPORATION
Note 1 - Basis of Presentation
The accompanying financial statements for the interim periods are unaudited.
In the opinion of management, all adjustments necessary for a fair statement
of the results for the interim periods included herein have been made. It is
suggested that these financial statements be read in conjunction with the
audited 1993 financial statements and notes thereto included in TRINOVA
Corporation's most recent annual report.
Note 2 - Special Charge
In the 1993 second quarter, the Company recorded a $26 million provision
before income taxes for the estimated costs for severance and other personnel-
related costs associated with worldwide work force reductions, primarily
focusing on the Company's industrial operations in Europe. This charge
reduced income before cumulative effect of accounting change for the 1993
nine-month period by $18.2 million, or $.64 per share.
Note 3 - Postretirement Benefits Other than Pensions
The Company adopted Statement of Financial Accounting Standards No. 106,
"Employers' Accounting for Postretirement Benefits Other than Pensions," in
the 1993 first quarter and recognized the transition obligation as the
cumulative effect of a change in accounting principle resulting in a non-cash
charge to income of $113.2 million pretax, $70.2 million after tax, or $2.48
per share.
Note 4 - Income (Loss) per Share
Income (loss) per share is computed using the average number of common shares
outstanding, including common stock equivalents. The assumed conversion of
the Company's 6 percent convertible debentures was included in average shares
outstanding for the three- and nine-month periods ended September 30, 1994,
increasing the average number of shares outstanding by 1,904,762 shares. For
purposes of computing net income per share for the three- and nine-month
periods ended September 30, 1994, net income was increased for the after-tax
equivalent of interest expense on the 6 percent convertible debentures. The
assumed conversion of the 6 percent convertible debentures was not included in
average shares outstanding for the three- and nine-month periods ended
September 30, 1993, because the effect of the inclusion would have been anti-
dilutive.
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<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
FINANCIAL REVIEW AND ANALYSIS OF OPERATIONS
Analysis of Operations
Third Quarter 1994 Compared with Third Quarter 1993
<TABLE>
The following data provide highlights for the 1994 third quarter compared with
the 1993 third quarter.
<CAPTION>
Percent
(dollars in thousands, Third Quarter Increase
except per share data) 1994 1993 (Decrease)
<S> <C> <C> <C>
CONSOLIDATED
Net sales $ 437,587 $ 393,263 11.3%
Manufacturing income 106,481 96,260 10.6
Manufacturing margin (%) 24.3 24.5
Operating income 33,723 23,217 45.3
Operating margin (%) 7.7 5.9
Net income 15,131 9,461 59.9
Net income per share .52 .33
INDUSTRIAL
Net sales 241,669 210,214 15.0
Operating income 25,445 11,747 116.6
Operating margin (%) 10.5 5.6
Order backlog at September 30 179,922 146,958 22.4
AUTOMOTIVE
Net sales 119,184 103,172 15.5
Operating income 8,214 9,627 (14.7)
Operating margin (%) 6.9 9.3
AEROSPACE & DEFENSE
Net sales 76,734 79,877 (3.9)
Operating income 6,188 6,878 (10.0)
Operating margin (%) 8.1 8.6
Order backlog at September 30 275,705 281,030 (1.9)
</TABLE>
-7-
<PAGE>
Third-quarter 1994 sales increased $44.3 million, or 11.3 percent, over the
1993 third quarter. Industrial and automotive sales increased 15 percent and
15.5 percent, respectively, while aerospace & defense sales declined 3.9
percent. U.S. sales increased $28.3 million, or 11 percent, and non-U.S.
sales increased $16 million, or 11.8 percent, over sales for the 1993 third
quarter. Changes in currency exchange rates accounted for nearly $7 million
of this increase.
Industrial sales increased $31.5 million, or 15 percent, over the prior year.
U.S. industrial markets continued to strengthen in the 1994 third quarter,
contributing to an increase in the Company's U.S. industrial sales of nearly
16 percent over the 1993 third quarter. Non-U.S. industrial sales also
continued to improve, increasing nearly 14 percent over the comparable 1993
period, principally on the strength of increased sales in Europe. Non-U.S.
industrial sales also included higher sales in the Asia/Pacific region and
sales in Brazil that were flat compared with the prior year. Order intake,
likewise, continued to show strong improvement compared with the prior year.
Third-quarter 1994 order intake increased nearly 15 percent resulting in order
backlog at September 30, 1994, of $179.9 million which was $33 million, or 22
percent, greater than at September 30, 1993.
Third-quarter 1994 automotive sales increased $16 million, or 15.5 percent,
over the 1993 third quarter, principally due to strong U.S. automotive sales.
Third-quarter 1994 sales to U.S. automotive markets increased nearly 21
percent over the 1993 third quarter. The Company's third-quarter 1994 sales
in the European automotive markets improved nearly 10 percent compared with
the 1993 third quarter. This increase in non-U.S. sales included the positive
effects of changes in currency exchange rates amounting to approximately $3
million. As expected, however, seasonal factors and the winding down of
certain programs led to a sales decline in the third quarter from the first
two quarters of 1994.
Aerospace & defense sales declined $3.1 million, or nearly 4 percent, from the
1993 third quarter. Third-quarter 1994 sales were consistent with the sales
pattern in the first half of the year, reflecting the continued weak
conditions in worldwide aerospace and military markets. Order backlog of
$275.7 million was $5.3 million, or nearly 2 percent, lower than at September
30, 1993, but did increase over the 1994 second quarter.
Consolidated manufacturing income improved over the 1993 third quarter.
Manufacturing margin, however, declined slightly from 24.5 percent to 24.3
percent. Manufacturing margin for the industrial and aerospace & defense
segments improved but manufacturing margin for the automotive segment
declined. The margin improvement for the industrial and aerospace & defense
segments reflects the benefits of the Company's continued commitment to cost
reduction through improvements to manufacturing processes and through
reductions in personnel. In addition, manufacturing margin benefitted from
increased sales, both from higher volume and selective price increases.
Automotive segment margins declined due to start-up costs associated with
model year changeovers. Changes in the mix of product sales, both in the U.S.
-8-
<PAGE>
and Europe, also contributed to the reduction in automotive segment margins.
The income effect of liquidation of LIFO inventory quantities was not
significant in the 1994 third quarter. Liquidation of LIFO inventory
quantities increased manufacturing income in the 1993 third quarter by $1.9
million.
Selling and general administrative and engineering, research and development
expenses (operating expenses) were slightly lower than in the 1993 third
quarter, but as a percent of sales declined to 16.6 percent in the 1994 third
quarter compared with 18.6 percent in the 1993 third quarter. Operating
income for the 1994 third quarter amounted to $33.7 million, compared with
$23.2 million in the 1993 third quarter.
Interest expense for the 1994 third quarter was $1.3 million lower than the
1993 third quarter, reflecting the effect of lower average debt levels in
1994. Other-net deductions were $1.2 million higher in the 1994 third quarter
due, in part, to minority interest in earnings adjustment for a consolidated
affiliate.
Net income for the 1994 third quarter amounted to $15.1 million, or 52 cents
per share, compared with $9.5 million, or 33 cents per share, in the 1993
third quarter. The Company's effective tax rate in the 1994 third quarter and
for the nine-month period was 35 percent. This compares with an effective tax
rate in the 1993 third quarter of 25.3 percent. Legislation enacted in the
1993 third quarter reduced the Company's 1993 third-quarter income tax
provision by approximately $1 million due principally to adjustment of net
deferred tax assets. The 1993 third-quarter income tax provision also
included the benefit from utilization of a previously unavailable operating
loss for a non-U.S. subsidiary.
-9-
<PAGE>
Nine Months 1994 Compared with Nine Months 1993
The following data provide highlights for the first nine months of 1994
compared with the first nine months of 1993.
<TABLE>
<CAPTION>
Nine Months Ended Percent
(dollars in thousands, September 30 Increase
except per share data) 1994 1993 (Decrease)
<S> <C> <C> <C>
CONSOLIDATED
Net sales $1,338,281 $1,242,180 7.7%
Manufacturing income 330,372 296,410 11.5
Manufacturing margin (%) 24.7 23.9
Special charge -- 26,000
Operating income 105,606 41,160* 156.6
Operating margin (%) 7.9 3.3*
Income before cumulative
effect of accounting change 47,729 5,974
Cumulative effect to January 1, 1993,
of accounting change, net of income
tax benefit -- (70,229)
Net income (loss) 47,729 (64,255)
Income (Loss) per Share
Income before cumulative
effect of accounting change 1.64 .21
Cumulative effect of accounting
change, net of income tax benefit -- (2.48)
Net income (loss) per share 1.64 (2.27)
INDUSTRIAL
Net sales 721,911 654,173 10.4
Special charge -- 19,200
Operating income 67,156 6,750*
Operating margin (%) 9.3 1.0*
Order backlog at September 30 179,922 146,958 22.4
AUTOMOTIVE
Net sales 382,806 335,559 14.1
Special charge -- 2,600
Operating income 36,303 31,308* 16.0
Operating margin (%) 9.5 9.3*
AEROSPACE & DEFENSE
Net sales 233,564 252,448 (7.5)
Special charge -- 3,600
Operating income 18,809 18,078* 4.0
Operating margin (%) 8.1 7.2*
Order backlog at September 30 275,705 281,030 (1.9)
* After deducting the special charge.
</TABLE>
-10-
<PAGE>
Sales for the first nine months of 1994 increased $96.1 million, or 7.7
percent, over the first nine months of 1993. U.S. sales increased $77.8
million, or nearly 10 percent, over the comparable period, while non-U.S.
sales increased $18.3 million, or 4 percent.
Industrial sales were $67.7 million, or 10.4 percent, higher than the 1993
nine-month period. Most sectors of the Company's industrial markets continued
to strengthen as U.S. industrial sales increased 14 percent over the
comparable 1993 period, and sales for Asia/Pacific increased 10 percent, while
sales for Europe and Brazil increased less than 5 percent each. The effects
of exchange rate changes and dispositions of certain product lines reduced the
industrial segment sales for the 1994 nine-month period by $6.4 million.
Automotive sales increased $47.2 million, or 14.1 percent, over the comparable
1993 period. Strong sales of light trucks, vans and small cars led to
improved sales for the North American car manufacturers and contributed to the
Company's higher U.S. sales in these markets during the first nine months of
1994. European sales increased $7.9 million, or nearly 5 percent, for the
nine-month period. Automotive sales are expected to be lower in the last half
of 1994 compared with the first half of the year due to third-quarter
seasonality and the phase out of certain contracts.
Aerospace & defense sales for the first nine months of 1994 were $18.9
million, or 7.5 percent, lower than the comparable 1993 period, reflecting the
continued low level of activity in worldwide aerospace and defense markets.
Dispositions and the effects of exchange rate changes reduced 1994 aerospace &
defense sales by $5.7 million, compared with 1993.
Consolidated manufacturing income and manufacturing margin for the first nine
months of 1994 improved over the comparable 1993 period. Manufacturing margin
for the industrial and aerospace & defense segments increased over 1993, while
manufacturing margin for the automotive segment declined. Liquidation of LIFO
inventory quantities increased manufacturing income in the 1994 nine-month
period by $.9 million, compared with $6.2 million in the 1993 nine-month
period.
Selling and general administrative and engineering, research and development
expenses were $4.5 million lower than in the first nine months of 1993.
Overhead expenses as a percent of sales were 16.8 percent for 1994, compared
with 18.5 percent in the first nine months of 1993. Operating income amounted
to $105.6 million for the first nine months of 1994, compared with $41.2
million for the comparable 1993 period. In the 1993 second quarter, the
Company recorded a $26 million provision for the estimated costs for severance
and other personnel-related costs relating to work force reductions, primarily
focusing on the Company's industrial operations in Europe. Before this
special charge, operating income for the first nine months of 1993 was $67.2
million.
Interest expense for the first nine months of 1994 was $3.5 million lower than
the comparable 1993 period, reflecting the effect of lower average debt levels
in 1994. Other-net deductions were $5.6 million higher in 1994 due, in part,
to minority interest in earnings adjustment for a consolidated affiliate.
-11-
<PAGE>
Net income for the first nine months of 1994 amounted to $47.7 million, or
$1.64 per share. The net loss for the first nine months of 1993 was $64.3
million, or $2.27 per share. The Company adopted Statement of Financial
Accounting Standards No. 106, "Employer's Accounting for Postretirement
Benefits Other than Pensions," in the 1993 first quarter and recognized the
transition obligation as the cumulative effect of a change in accounting
principle, resulting in a charge to income of $113.2 million pretax, $70.2
million after tax, or $2.48 per share. Before the special charge and
cumulative effect adjustment, net income for the first nine months of 1993
amounted to $24.2 million, or 85 cents per share.
Liquidity, Working Capital and Capital Investment
Cash provided by operating activities for the first nine months of 1994
totaled $97.3 million, compared with $83.5 million for the first nine months
of 1993. The increased cash flow in 1994 was principally the result of higher
earnings. Net restructuring expenditures in 1994, after deducting proceeds
from disposals of businesses amounting to $9 million, totaled $4.9 million.
This compares with restructuring payments for the first nine months of 1993 of
$20.9 million, after deducting proceeds from dispositions totaling $2.3
million. Internally generated sources of cash, including cash from the
exercise of stock options, provided funds sufficient to repay debt totaling
$62.7 million in 1994, contributing to the improvement in the debt-to-
capitalization ratio (debt divided by debt plus equity) from 55.1 percent at
December 31, 1993, to 44.2 percent at September 30, 1994.
During the 1994 third quarter, the Company executed a new five-year, $175
million revolving credit agreement with a consortium of U.S. and non-U.S.
banks. The agreement is intended to support the Company's commercial paper
borrowings and, to the extent not so utilized, provide domestic borrowings.
The remaining borrowing capacity under this arrangement at September 30, 1994,
was $168 million. In addition, the Company has uncommitted arrangements with
various banks to provide short-term financing as necessary. The Company
expects that cash flow from operating activities and available short-term
financing arrangements will be sufficient to meet normal operating
requirements over the near term.
-12-
<PAGE>
PART II - OTHER INFORMATION
TRINOVA CORPORATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibit is filed hereunder as part of Part I:
Exhibit (11) Statement re: Computation of Per Share Earnings
(b) The following exhibits are filed hereunder as part of Part II:
Exhibit (27) Financial Data Schedule
Exhibit (99(i))-2 Credit Agreement, dated as of August 31, 1994, among
TRINOVA Corporation (borrower) and The Bank of Tokyo
Trust Company; Chemical Bank; Citibank, N.A.;
Dresdner Bank AG, New York and Grand Cayman
branches; The First National Bank of Chicago; Morgan
Guaranty Trust Company of New York; NBD Bank, N.A.
and Union Bank of Switzerland, Chicago branch
(banks) and Citibank, N.A. (administrative agent).
The following exhibits are filed as part of Part II and are incorporated
by reference hereunder:
Exhibit (4)-1 First Supplemental Indenture, dated as of May 4,
1992, between TRINOVA Corporation and NBD Bank,
N.A., with respect to the issuance of $75,000,000
aggregate principal amount of TRINOVA Corporation
7.95% Notes Due 1997, filed as Exhibit (4)-1 to Form
SE filed on May 6, 1992
Exhibit (4)-2 7.95% Notes Due 1997, issued pursuant to the
Indenture, dated as of January 28, 1988, between
TRINOVA Corporation and NBD Bank, N.A. (formerly
National Bank of Detroit), as supplemented by the
First Supplemental Indenture, dated as of May 4,
1992, between TRINOVA Corporation and NBD Bank,
N.A., filed as Exhibit (4)-2 to Form SE filed on May
6, 1992
Exhibit (4)-3 Officers' Certificate of TRINOVA Corporation, dated
May 4, 1992, pursuant to Section 2.01 of the
Indenture, dated as of January 28, 1988, between
TRINOVA Corporation and NBD Bank, N.A. (formerly
National Bank of Detroit), as supplemented by the
First Supplemental Indenture, dated as of May 4,
1992, between TRINOVA Corporation and NBD Bank,
N.A., filed as Exhibit (4)-3 to Form SE filed on May
6, 1992
-13-
<PAGE>
Item 6. Exhibits and Reports on Form 8-K - Continued
Exhibit (4)-4 Rights Agreement, dated January 26, 1989, between
TRINOVA Corporation and First Chicago Trust Company
of New York filed as Exhibit (2) to Form 8-A filed
on January 27, 1989, as amended by the First
Amendment to Rights Agreement filed as Exhibit (5)
to Form 8 filed on July 1, 1992
Exhibit (4)-5 Form of Share Certificate for Common Shares, $5 par
value, of TRINOVA Corporation, filed as Exhibit (4)-
2 to Form SE filed on July 1, 1992
Exhibit (4)-6 Fiscal Agency Agreement, dated as of October 26,
1987, between TRINOVA Corporation, as Issuer, and
Bankers Trust Company, as Fiscal Agent, with respect
to $100,000,000 aggregate principal amount of
TRINOVA Corporation 6% Convertible Subordinated
Debentures Due 2002, filed as Exhibit (4)-1 to Form
SE filed on March 18, 1993
Exhibit (4)-7 Indenture, dated as of January 28, 1988, between
TRINOVA Corporation and NBD Bank, N.A. (formerly
National Bank of Detroit), with respect to the
issuance of $50,000,000 aggregate principal amount
of TRINOVA Corporation 9.55% Senior Sinking Fund
Debentures Due 2018, and the issuance of $75,000,000
aggregate principal amount of TRINOVA Corporation
7.95% Notes Due 1997, filed as Exhibit (4)-2 to Form
SE filed on March 18, 1993
Exhibit (10)-1 TRINOVA Corporation Plan for Optional Deferment of
Directors' Fees (Restated January 25, 1990), filed
as Exhibit (10)-2 to Form SE filed on March 20, 1990
Exhibit (10)-2 TRINOVA Corporation Directors' Retirement Plan
(Restated January 1, 1990), filed as Exhibit (10)-3
to Form SE filed on March 20, 1990
Exhibit (10)-3 Aeroquip Corporation Incentive Compensation Plan,
filed as Exhibit (10)-4 to Form SE filed on March
20, 1990
Exhibit (10)-4 Vickers, Incorporated Incentive Compensation Plan,
filed as Exhibit (10)-5 to Form SE filed on March
20, 1990
Exhibit (10)-5 TRINOVA Corporation Supplemental Benefit Plan
(Restated January 1, 1989), filed as Exhibit (19)-1
to Form SE filed on November 6, 1992
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<PAGE>
Item 6. Exhibits and Reports on Form 8-K - Continued
Exhibit (10)-6 TRINOVA Corporation 1982 Stock Option Plan, filed as
Exhibit (10)-1 to Form SE filed on March 18, 1993
Exhibit (10)-7 TRINOVA Corporation 1984 Incentive Compensation
Plan, filed as Exhibit (10)-2 to Form SE filed on
March 18, 1993
Exhibit (10)-8 TRINOVA Corporation 1987 Stock Option Plan, filed as
Exhibit (10)-3 to Form SE filed on March 18, 1993
Exhibit (10)-9 Change in Control Agreement for Officers, filed as
Exhibit (10)-4 to Form SE filed on March 18, 1993
(the Agreements executed by the Company and various
executive officers of the Company are identical in
all respects to the form of Agreement filed as an
Exhibit to Form SE except as to differences in the
identity of the officers and the dates of execution,
and as to other variations directly necessitated by
said differences)
Exhibit (10)-10 Change in Control Agreement for Non-officers, filed
as Exhibit (10)-5 to Form SE filed on March 18, 1993
(the Agreements executed by the Company and various
non-officer employees of the Company are identical
in all respects to the form of Agreement filed as an
Exhibit to Form SE except as to differences in the
identity of the employees and the dates of
execution, and as to other variations directly
necessitated by said differences)
Exhibit (10)-11 TRINOVA Corporation 1994 Stock Incentive Plan, filed
as Appendix A to the proxy statement for the annual
meeting held on April 21, 1994
Exhibit (10)-12 TRINOVA Corporation 1989 Non-Employee Directors'
Equity Plan, filed as Exhibit (10)-12 to Form 10-K
filed on March 18, 1994
Exhibit (99(i))-1 TRINOVA Corporation Directors' Charitable Award
Program, filed as Exhibit (99(i))-2 to Form 10-K
filed on March 18, 1994
(b) There were no reports on Form 8-K filed for the quarter ended
September 30, 1994.
-15-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRINOVA CORPORATION
By /S/ DARRYL F. ALLEN
-----------------------------------------
November 3, 1994 Darryl F. Allen
Chairman, President and
Chief Executive Officer
(Principal Executive Officer)
By /S/ DAVID M. RISLEY
November 3, 1994 -----------------------------------------
David M. Risley
Vice President - Finance and
Chief Financial Officer
(Principal Financial Officer)
-16-
EXHIBIT INDEX
Exhibit No. Page No.
(4)-1 First Supplemental Indenture, dated as of May 4, Incorporated
1992, between TRINOVA Corporation and NBD Bank, by Reference
N.A., with respect to the issuance of
$75,000,000 aggregate principal amount of
TRINOVA Corporation 7.95% Notes Due 1997, filed
as Exhibit (4)-1 to Form SE filed on May 6, 1992
(4)-2 7.95% Notes Due 1997, issued pursuant to the Incorporated
Indenture, dated as of January 28, 1988, between by Reference
TRINOVA Corporation and NBD Bank, N.A. (formerly
National Bank of Detroit), as supplemented by
the First Supplemental Indenture, dated as of
May 4, 1992, between TRINOVA Corporation and NBD
Bank, N.A., filed as Exhibit (4)-2 to Form SE
filed on May 6, 1992
(4)-3 Officers' Certificate of TRINOVA Corporation, Incorporated
dated May 4, 1992, pursuant to Section 2.01 of by Reference
the Indenture, dated as of January 28, 1988,
between TRINOVA Corporation and NBD Bank, N.A.
(formerly National Bank of Detroit), as
supplemented by the First Supplemental
Indenture, dated as of May 4, 1992, between
TRINOVA Corporation and NBD Bank, N.A., filed as
Exhibit (4)-3 to Form SE filed on May 6, 1992
(4)-4 Rights Agreement, dated January 26, 1989, Incorporated
between TRINOVA Corporation and First Chicago by Reference
Trust Company of New York filed as Exhibit (2)
to Form 8-A filed on January 27, 1989, as
amended by the First Amendment to Rights
Agreement filed as Exhibit (5) to Form 8 filed
on July 1, 1992
(4)-5 Form of Share Certificate for Common Shares, $5 Incorporated
par value, of TRINOVA Corporation, filed as by Reference
Exhibit (4)-2 to Form SE filed on July 1, 1992
(4)-6 Fiscal Agency Agreement, dated as of October 26, Incorporated
1987, between TRINOVA Corporation, as Issuer, by Reference
and Bankers Trust Company, as Fiscal Agent, with
respect to $100,000,000 aggregate principal
amount of TRINOVA Corporation 6% Convertible
Subordinated Debentures Due 2002, filed as
Exhibit (4)-1 to Form SE filed on March 18, 1993
-17-
<PAGE>
EXHIBIT INDEX - Continued
Exhibit No. Page No.
(4)-7 Indenture, dated as of January 28, 1988, between Incorporated
TRINOVA Corporation and NBD Bank, N.A. (formerly by Reference
National Bank of Detroit), with respect to the
issuance of $50,000,000 aggregate principal
amount of TRINOVA Corporation 9.55% Senior
Sinking Fund Debentures Due 2018, and the
issuance of $75,000,000 aggregate principal
amount of TRINOVA Corporation 7.95% Notes Due
1997, filed as Exhibit (4)-2 to Form SE filed
on March 18, 1993
(10)-1 TRINOVA Corporation Plan for Optional Deferment Incorporated
of Directors' Fees (Restated January 25, 1990), by Reference
filed as Exhibit (10)-2 to Form SE filed on
March 20, 1990
(10)-2 TRINOVA Corporation Directors' Retirement Plan Incorporated
(Restated January 1, 1990), filed as Exhibit by Reference
(10)-3 to Form SE filed on March 20, 1990
(10)-3 Aeroquip Corporation Incentive Compensation Incorporated
Plan, filed as Exhibit (10)-4 to Form SE filed by Reference
on March 20, 1990
(10)-4 Vickers, Incorporated Incentive Compensation Incorporated
Plan, filed as Exhibit (10)-5 to Form SE filed by Reference
on March 20, 1990
(10)-5 TRINOVA Corporation Supplemental Benefit Plan Incorporated
(Restated January 1, 1989), filed as Exhibit by Reference
(19)-1 to Form SE filed on November 6, 1992
(10)-6 TRINOVA Corporation 1982 Stock Option Plan, Incorporated
filed as Exhibit (10)-1 to Form SE filed on by Reference
March 18, 1993
(10)-7 TRINOVA Corporation 1984 Incentive Compensation Incorporated
Plan, filed as Exhibit (10)-2 to Form SE filed by Reference
on March 18, 1993
(10)-8 TRINOVA Corporation 1987 Stock Option Plan, Incorporated
filed as Exhibit (10)-3 to Form SE filed on by Reference
March 18, 1993
-18-
<PAGE>
EXHIBIT INDEX - Continued
Exhibit No. Page No.
(10)-9 Change in Control Agreement for Officers, Incorporated
filed as Exhibit (10)-4 to Form SE filed on by Reference
March 18, 1993 (the Agreements executed by the
Company and various executive officers of the
Company are identical in all respects to the
form of Agreement filed as an Exhibit to Form SE
except as to differences in the identity of the
officers and the dates of execution, and as to
other variations directly necessitated by said
differences)
(10)-10 Change in Control Agreement for Non-officers, Incorporated
filed as Exhibit (10)-5 to Form SE filed on by Reference
March 18, 1993 (the Agreements executed by the
Company and various non-officer employees of
the Company are identical in all respects to
the form of Agreement filed as an Exhibit to
Form SE except as to differences in the identity
of the employees and the dates of execution, and
as to other variations directly necessitated by
said differences)
(10)-11 TRINOVA Corporation 1994 Stock Incentive Plan, Incorporated
filed as Appendix A to the proxy statement for by Reference
the annual meeting held on April 21, 1994
(10)-12 TRINOVA Corporation 1989 Non-Employee Directors' Incorporated
Equity Plan, filed as Exhibit (10)-12 to by Reference
Form 10-K filed on March 18, 1994
(11) Statement re: Computation of Per Share Earnings 20
(27) Financial Data Schedule 21
(99(i))-1 TRINOVA Corporation Directors' Charitable Award Incorporated
Program, filed as Exhibit (99(i))-2 to by Reference
Form 10-K filed on March 18, 1994
(99(i))-2 Credit Agreement, dated as of August 31, 1994, 22
among TRINOVA Corporation (borrower) and The Bank
of Tokyo Trust Company; Chemical Bank; Citibank,
N.A.; Dresdner Bank AG, New York and Grand Cayman
branches; The First National Bank of Chicago;
Morgan Guaranty Trust Company of New York; NBD
Bank, N.A. and Union Bank of Switzerland, Chicago
branch (banks) and Citibank, N.A. (administrative
(agent).
-19-
EXHIBIT 11
<TABLE>
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
TRINOVA CORPORATION
(In thousands, except per share data)
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
1994 1993 1994 1993
<S> <C> <C> <C> <C>
AVERAGE SHARES OF COMMON STOCK
AND COMMON STOCK EQUIVALENTS
OUTSTANDING (NOTE A)
Average shares outstanding 28,775 28,366 28,695 28,299
Assumed conversion of the 6 percent
convertible debentures 1,905 - 1,905 -
Net effect of dilutive stock
options based upon treasury stock
method using average market price 223 68 223 68
--------- ---------- ---------- ----------
Average shares of common stock
and common stock equivalents
outstanding 30,903 28,434 30,823 28,367
========== ========== ========== ==========
INCOME (LOSS) ATTRIBUTABLE TO COMMON
STOCK (NOTE A)
Income before cumulative effect
of change in accounting principle $ 15,131 $ 9,461 $ 47,729 $ 5,974
After-tax equivalent of interest
expense on the 6 percent convertible
debentures 930 - 2,790 -
Cumulative effect of change in
accounting for postretirement
benefits other than pensions, net
of income tax benefit - - - (70,229)
---------- ---------- ---------- ----------
Income (loss) attributable to
common stock $ 16,061 $ 9,461 $ 50,519 $ (64,255)
========== ========== ========== ==========
Income (loss) per share
Income before cumulative effect of
change in accounting principle $ .52 $ .33 $ 1.64 $ .21
Cumulative effect of change in
accounting for postretirement
benefits other than pensions - - - (2.48)
---------- ---------- ---------- ----------
Net Income (Loss) per Share $ .52 $ .33 $ 1.64 $ (2.27)
========== ========== ========== ==========
<FN>
Note A - Net income (loss) per share was computed on the average number of
common shares outstanding, including common stock equivalents. In the 1994
third quarter and nine month period, common stock equivalents included the
assumed conversion of the Company's 6 percent convertible debentures and
income used in computing income per share was increased for the after-tax
equivalent of interest expense on the 6 percent convertible debentures. For
the 1993 third quarter and nine month period, the assumed conversion of the 6
percent convertible debentures was not included in average shares outstanding
or in income used in computing income per share because the effect of the
inclusion would have been anti-dilutive.
</FN>
</TABLE>
-20-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE STATEMENT
OF FINANCIAL POSITION AND THE CONDENSED STATEMENT OF OPERATIONS AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 12,293
<SECURITIES> 0
<RECEIVABLES> 261,471
<ALLOWANCES> 15,775
<INVENTORY> 213,932
<CURRENT-ASSETS> 529,300
<PP&E> 864,722
<DEPRECIATION> 482,733
<TOTAL-ASSETS> 1,000,535
<CURRENT-LIABILITIES> 296,674
<BONDS> 235,700
<COMMON> 143,970
0
0
<OTHER-SE> 168,702
<TOTAL-LIABILITY-AND-EQUITY> 1,000,535
<SALES> 1,338,281
<TOTAL-REVENUES> 1,338,281
<CGS> 1,007,909
<TOTAL-COSTS> 1,007,909
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,260
<INCOME-PRETAX> 73,429
<INCOME-TAX> 25,700
<INCOME-CONTINUING> 47,729
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 47,729
<EPS-PRIMARY> 1.64
<EPS-DILUTED> 1.64
</TABLE>
EXHIBIT (99(i))-2
================================================================
U.S. $175,000,000
CREDIT AGREEMENT
Dated as of August 31, 1994
Among
TRINOVA CORPORATION
as Borrower
and
THE BANKS NAMED HEREIN
as Banks
and
CITIBANK, N.A.
as Administrative Agent
================================================================
-22-
<PAGE>
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms.. . . . . . . . . . . . . . . . . 1
SECTION 1.02. Computation of Time Periods.. . . . . . . . . . . . . .14
SECTION 1.03. Accounting Terms. . . . . . . . . . . . . . . . . . . .14
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The A Advances. . . . . . . . . . . . . . . . . . . . .15
SECTION 2.02. Making the A Advances.. . . . . . . . . . . . . . . . .15
SECTION 2.03. The B Advances. . . . . . . . . . . . . . . . . . . . .17
SECTION 2.04. Certain Fees. . . . . . . . . . . . . . . . . . . . . .21
SECTION 2.05. Reduction of the Commitments. . . . . . . . . . . . . .22
SECTION 2.06. Repayment of A Advances.. . . . . . . . . . . . . . . .22
SECTION 2.07. Interest on A Advances. . . . . . . . . . . . . . . . .22
SECTION 2.08. Additional Interest on Eurodollar Rate
Advances. . . . . . . . . . . . . . . . . . . . . . .23
SECTION 2.09. Interest Rate Determinations; Changes in
Rating Systems. . . . . . . . . . . . . . . . . . . .23
SECTION 2.10. Voluntary Conversion of A Advances. . . . . . . . . . .25
SECTION 2.11. Prepayments of A Advances.. . . . . . . . . . . . . . .25
SECTION 2.12. Increased Costs.. . . . . . . . . . . . . . . . . . . .25
SECTION 2.13. Illegality. . . . . . . . . . . . . . . . . . . . . . .26
SECTION 2.14. Payments and Computations.. . . . . . . . . . . . . . .27
SECTION 2.15. Taxes.. . . . . . . . . . . . . . . . . . . . . . . . .28
SECTION 2.16. Sharing of Payments, Etc. . . . . . . . . . . . . . . .30
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Condition Precedent to Effectiveness of
Sections 2.01 and 2.03. . . . . . . . . . . . . . . .31
SECTION 3.02. Conditions Precedent to Each
A Borrowing.. . . . . . . . . . . . . . . . . . . . .32
SECTION 3.03. Conditions Precedent to Each
B Borrowing.. . . . . . . . . . . . . . . . . . . . .33
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the
Borrower. . . . . . . . . . . . . . . . . . . . . . .34
-23-
<PAGE>
Section Page
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants.. . . . . . . . . . . . . . . . .36
SECTION 5.02. Negative Covenants. . . . . . . . . . . . . . . . . . .40
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.. . . . . . . . . . . . . . . . . . .45
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action. . . . . . . . . . . . . . . .48
SECTION 7.02. Administrative Agent's Reliance, Etc. . . . . . . . . .48
SECTION 7.03. Citibank and Affiliates.. . . . . . . . . . . . . . . .49
SECTION 7.04. Lender Credit Decision. . . . . . . . . . . . . . . . .49
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . .49
SECTION 7.06. Successor Administrative Agent. . . . . . . . . . . . .50
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc.. . . . . . . . . . . . . . . . . . . .51
SECTION 8.02. Notices, Etc. . . . . . . . . . . . . . . . . . . . . .51
SECTION 8.03. No Waiver; Remedies.. . . . . . . . . . . . . . . . . .52
SECTION 8.04. Costs, Expenses and Indemnification . . . . . . . . . .52
SECTION 8.05. Right of Set-off. . . . . . . . . . . . . . . . . . . .54
SECTION 8.06. Binding Effect. . . . . . . . . . . . . . . . . . . . .54
SECTION 8.07. Assignments, Designations and
Participations. . . . . . . . . . . . . . . . . . . .55
SECTION 8.08. Governing Law; Submission to
Jurisdiction. . . . . . . . . . . . . . . . . . . . .59
SECTION 8.09. Severability. . . . . . . . . . . . . . . . . . . . . .59
SECTION 8.10. Execution in Counterparts.. . . . . . . . . . . . . . .59
SECTION 8.11. Survival. . . . . . . . . . . . . . . . . . . . . . . .60
SECTION 8.12. Termination of Existing Credit
Facilities. . . . . . . . . . . . . . . . . . . . . .60
Schedule I - List of Applicable Lending Offices
Schedule II - Existing Credit Facilities
Schedule III - Existing Liens
-24-
<PAGE>
Exhibit A-1 - Form of A Note
Exhibit A-2 - Form of B Note
Exhibit B-1 - Notice of A Borrowing
Exhibit B-2 - Notice of B Borrowing
Exhibit C - Assignment and Acceptance
Exhibit D - Designation Agreement
Exhibit E - Form of Opinion of Counsel for the Borrower
Exhibit F - Form of Opinion of Special New York
Counsel to the Administrative Agent
-25-
<PAGE>
CREDIT AGREEMENT dated as of August 31, 1994 among
TRINOVA CORPORATION, an Ohio corporation (the "Borrower"), the
banks (the "Banks") listed on the signature pages hereof, and
CITIBANK, N.A. ("Citibank") as agent (the "Administrative Agent")
for the Lenders hereunder.
The Borrower has requested that the Banks make loans to
it in an aggregate principal amount not exceeding $175,000,000 at
any one time outstanding to finance the operations of the
Borrower and its Subsidiaries, to refinance certain existing
indebtedness of the Borrower, to support the Borrower's
commercial paper program and for other general corporate
purposes, and the Banks are prepared to make such loans upon the
terms and conditions hereof. Accordingly, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings
(such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"A Advance" means an advance by a Lender to the
Borrower as part of an A Borrowing and refers to a Base Rate
Advance or a Eurodollar Rate Advance, each of which shall be
a "Type" of A Advance.
"A Borrowing" means a borrowing consisting of
simultaneous A Advances of the same Type made by each of the
Lenders pursuant to Section 2.01.
"A Note" means a promissory note of the Borrower
payable to the order of any Lender, in substantially the
form of Exhibit A-1 hereto, evidencing the aggregate
indebtedness of the Borrower to such Lender resulting from
the A Advances made by such Lender.
"Advance" means an A Advance or a B Advance.
"Affiliate" means, as to any Person, any other Person
that, directly or indirectly, controls, is controlled by or
is under common control with such Person or is a director or
officer of such Person. For purposes of this definition,
the term "control" (including the terms "controlling",
-26-
<PAGE>
"controlled by" and "under common control with") of a Person
means the possession, direct or indirect, of the power to
vote 5% or more of the voting capital stock of such Person
or to direct or cause the direction of the management and
policies of such Person, whether through the ownership of
such voting capital stock, by contract or otherwise.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of
a Base Rate Advance and such Lender's Eurodollar Lending
Office in the case of a Eurodollar Rate Advance and, in the
case of a B Advance, the office of such Lender notified by
such Lender to the Administrative Agent as its Applicable
Lending Office with respect to such B Advance.
"Applicable Margin" for any A Advance for any Rating
Level Period shall be the rate for the respective Type of
A Advance set forth below opposite such Rating Level Period:
Applicable Margin (% p.a.)
Rating Level Base Rate Eurodollar
Period Advances Rate Advances
Rating Level 1 Period 0.00% 0.30%
Rating Level 2 Period 0.00% 0.40%
Rating Level 3 Period 0.00% 0.50%
Each change in the Applicable Margin resulting from a Rating
Level Change shall be effective (including with respect to
each A Advance then outstanding) on the effective date of
such Rating Level Change.
"Assignment and Acceptance" means an assignment and
acceptance entered into by a Lender and an Eligible
Assignee, and accepted by the Administrative Agent, in
substantially the form of Exhibit C hereto.
"Attributable Debt" when used in connection with a sale
and lease-back transaction means, at any time, the lesser of
(a) the fair value of the Principal Asset subject to such
arrangement at such time or (b) the then present value
(computed by discounting at the then Base Rate, compounded
semiannually) of the obligation of a lessee for fixed net
rental payments during the remaining term of any lease
(including any period for which such lease has been extended
or may, at the option of the lessor, be extended). The
term
-27-
<PAGE>
"net rental payments" under any lease for any period shall
mean the sum of the rental and other fixed payments required
to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid in such
period by the lessee (whether or not designated as rental or
additional rental) on account of maintenance and repairs,
insurance, taxes, assessments, water rates or similar
charges or required to be paid by such lessee thereunder
contingent upon the amount of sales, assessments, water or
similar charges.
"B Advance" means an advance by a Lender to the
Borrower as part of a B Borrowing resulting from the auction
bidding procedure described in Section 2.03.
"B Borrowing" means a borrowing consisting of
simultaneous B Advances from each of the Lenders whose offer
to make one or more B Advances as part of such borrowing has
been accepted by the Borrower under the auction bidding
procedure described in Section 2.03.
"B Note" means a promissory note of the Borrower
payable to the order of any Lender, in substantially the
form of Exhibit A-2 hereto, evidencing the indebtedness of
the Borrower to such Lender resulting from a B Advance made
by such Lender.
"B Reduction" has the meaning specified in
Section 2.01.
"Base Rate" means, for any period, a fluctuating
interest rate per annum as shall be in effect from time to
time which rate per annum shall at all times be equal to the
higher of:
(a) the rate of interest announced publicly by
Citibank in New York, New York, from time to time, as
Citibank's base rate; and
(b) 1/2 of one percent per annum above the
Federal Funds Rate for such period.
"Base Rate Advance" means an A Advance which bears
interest as provided in Section 2.07(a)(i).
"Borrowed Money" means, for the Borrower and its
Subsidiaries, (i) indebtedness for borrowed money
(including, without limitation, liabilities in respect of
drawings under acceptances, letters of credit and similar
-28-
<PAGE>
extensions of credit, other than (x) any such instruments
issued in respect of trade payables, (y) documentary letters
of credit, and (z) non-documentary letters of credit issued
in an individual face amount of less than $5,000,000);
(ii) obligations as lessee under leases which shall have
been or should be, in accordance with generally accepted
accounting principles, recorded as capital leases;
(iii) obligations evidenced by notes, bonds, debentures or
similar instruments; (iv) obligations under direct or
indirect guaranties (other than guaranties of obligations of
the Borrower's Subsidiaries by the Borrower or any of the
Borrower's other Subsidiaries) in respect of, and
obligations (contingent or otherwise) to purchase or
otherwise acquire, or otherwise to assure a creditor against
loss in respect of, indebtedness or obligations of others of
the kinds referred to in clause (i) through (iii) above or
clause (v) below; (v) indebtedness or obligations of others
of the kinds referred to in clauses (i) through (iv) above
secured by (or for which the holder thereof has an existing
right, contingent or otherwise, to be secured by) any Lien
on property owned by the Borrower or any of its
Subsidiaries, even though the Borrower or such Subsidiary
has not assumed or become liable for the payment of such
indebtedness or obligations; and (vi) liabilities in respect
of unfunded vested benefits under plans covered by Title IV
of ERISA.
"Borrowing" means an A Borrowing or a B Borrowing.
"Business Day" means a day of the year on which banks
are not required or authorized to close in New York City
and, if the applicable Business Day relates to any
Eurodollar Rate Advances, on which dealings are carried on
in the London interbank market.
"Change in Control" means any of the following events:
(i) the Borrower is merged, consolidated or
reorganized into or with another corporation or other
Person, and as a result of such merger, consolidation or
reorganization less than a majority of the combined voting
power of the then outstanding securities of such corporation
or other Person immediately after such transaction are held
in the aggregate by the holders of Voting Stock immediately
prior to such transaction;
(ii) if the Borrower sells all or substantially all of
its assets to any other corporation or other Person, less
than a majority of the combined voting power of the then
-29-
<PAGE>
outstanding securities of such corporation or other Person
immediately after such transaction are held in the aggregate
by the holders of Voting Stock immediately prior to such
sale;
(iii) there is a report filed on Schedule 13D or
Schedule 14D-1 (or any successor schedule, form or report),
each as promulgated pursuant to the Securities Exchange Act
of 1934 ("Exchange Act"), disclosing that any Person has
become the beneficial owner of 35% or more of the Voting
Stock; provided that, if such report discloses an
acquisition of beneficial ownership of 35% or more but less
than 50% of the Voting Stock, no Change in Control for
purposes of this Agreement shall be deemed to have occurred
if the acquisition of Voting Stock so disclosed was first
approved in accordance with Ohio law either by a majority of
the Board of Directors in office immediately prior to such
acquisition or by the shareholders of the Borrower;
(iv) the Borrower files a report or proxy statement
with the Securities and Exchange Commission pursuant to the
Exchange Act disclosing in response to Form 8-K or Schedule
14A (or any successor schedule, form or report or item
therein) that a change in control of the Borrower has or may
have occurred or will or may occur in the future pursuant to
any then-existing contract or transaction; or
(v) if during any period of two consecutive years,
individuals who at the beginning of any such period
constitute the Directors of the Borrower cease for any
reason to constitute at least a majority thereof, unless the
election, or the nomination for election by the Borrower's
shareholders, of each Director of the Borrower first elected
during such period was approved by a vote of at least
two-thirds of the Directors of the Borrower then still in
office who were Directors of the Borrower at the beginning
of any such period, or was approved by the affirmative vote
of a majority of the voting power of the Borrower in the
election of directors in accordance with Ohio law.
Notwithstanding the foregoing provisions of subparagraph
(iii) or (iv) hereof, a "Change in Control" shall not be
deemed to have occurred for purposes of this Agreement
solely because (x) the Borrower, (y) an entity in which the
Borrower directly or indirectly beneficially owns 50% or
more of the voting securities, or (z) any Borrower-sponsored
employee stock ownership plan or any other employee benefit
plan of the Borrower, either files or becomes obligated to
file a report or a proxy statement under or in response to
-30-
<PAGE>
Schedule 13D, Schedule 14D-1, Form 8-K or Schedule 14A (or
any successor schedule, form or report or item therein)
under the Exchange Act, disclosing beneficial ownership by
it of shares of Voting Stock whether in excess of 35% or
otherwise, or because the Borrower reports that a change in
control of the Borrower has or may have occurred or will or
may occur in the future by reason of such beneficial
ownership.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time.
"Commitment" has the meaning specified in Section 2.01.
"Consolidated Capitalization" means the sum of
(i) Borrowed Money, plus (ii) the par value (or value stated
on the books of the Borrower) of the issued and outstanding
capital stock of all classes of the Borrower, plus (or minus
in the case of a surplus deficit) (iii) the amount of the
consolidated surplus, whether capital or earned, of the
Borrower and its Subsidiaries, adjusted to exclude the
excess of (x) the cost of post-retirement benefits other
than pensions recognized on an accrual basis over (y) the
cost which would have been recognized on a cash basis.
"Consolidated Earnings before Interest and Taxes" means
the sum of (i) consolidated net earnings of the Borrower and
its Subsidiaries before extraordinary items, cumulative
effect adjustments, unusual or infrequent items that are
separately disclosed in the financial statements or notes to
financial statements, plus (ii) income taxes, plus (iii)
Consolidated Interest Expense.
"Consolidated Interest Expense" means total interest
expense determined on a consolidated basis for the Borrower
and its Subsidiaries in accordance with generally accepted
accounting principles, consistent with those followed in the
preparation of financial statements furnished pursuant to
Section 5.01(a).
"Consolidated Net Tangible Assets" means the
consolidated assets of the Borrower and its Subsidiaries,
less, without duplication, (i) consolidated current
liabilities, (ii) asset reserves, liability, contingency and
other appropriate reserves, including reserves for
depreciation and for deferred income taxes, (iii) all other
liabilities (other than liabilities for Borrowed Money of
the type referred to in clauses (i), (ii), (iv) and (vi) of
the definition of such term in this Section 1.01), and
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(iv) treasury stock, unamortized debt discount and expense,
good will, trademarks, trade names, patents, deferred
charges and other intangible assets, all as determined in
accordance with generally accepted accounting principles
consistent with those followed in the preparation of the
financial statements furnished pursuant to Section 5.01(a)
with appropriate adjustments for minority interests, if any.
"Convert", "Conversion" and "Converted" each refers to
a conversion of Advances of one Type into Advances of the
other Type pursuant to Section 2.09 or 2.10.
"Default" means an event that, with notice or lapse of
time or both, would become an Event of Default.
"Designated Bidder" means (i) an Eligible Assignee or
(ii) a special purpose corporation which is engaged in
making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business and that issues
(or the parent of which issues) commercial paper rated at
least Prime-1 by Moody's or A-1 by Standard & Poor's (or a
comparable rating from a successor of either of them), that,
in either case, (x) is organized under the laws of the
United States or any State thereof, (y) shall have become a
party hereto pursuant to Section 8.07(d), (e) and (f), and
(z) is not otherwise a Lender.
"Designation Agreement" means a designation agreement
entered into by a Lender (other than a Designated Bidder)
and a Designated Bidder, and accepted by the Administrative
Agent, in substantially the form of Exhibit D hereto.
"Domestic Lending Office" means, with respect to any
Lender, the office of such Lender specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in
the Assignment and Acceptance pursuant to which it became a
Lender, or such other office of such Lender as such Lender
may from time to time specify to the Borrower and the
Administrative Agent.
"Eligible Assignee" means:
(i) a commercial bank organized under the laws of the
United States, or any State thereof, and having total assets
in excess of $100,000,000.00;
(ii) a savings and loan association or savings bank
organized under the laws of the United States, or any State
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thereof, and having total assets in excess of
$100,000,000.00;
(iii) a commercial bank organized under the laws of any
other country which is a member of the OECD or has concluded
special lending arrangements with the International Monetary
Fund associated with its General Arrangements to Borrow or
of the Cayman Islands, or a political subdivision of any
such country, and having total assets in excess of
$100,000,000.00, provided that such bank is acting through a
branch or agency located in the United States;
(iv) the central bank of any country which is a member
of the OECD;
(v) a finance company, insurance company or other
financial institution or fund (whether a corporation,
partnership or other entity) which is engaged in making,
purchasing or otherwise investing in commercial loans in the
ordinary course of its business, and having total assets in
excess of $100,000,000.00;
(vi) a Lender; and
(vii) an Affiliate of a Lender;
provided that neither the Borrower nor any Affiliate of the
Borrower shall qualify as an Eligible Assignee.
"Environmental Laws" means any and all present and
future Federal, state, local and foreign laws, rules or
regulations, and any orders or decrees, in each case as now
or hereafter in effect, relating to the regulation or
protection of human health, safety or the environment or to
emissions, discharges, releases or threatened releases of
pollutants, contaminants, chemicals or toxic or hazardous
substances or wastes into the indoor or outdoor environment,
including, without limitation, ambient air, soil, surface
water, ground water, wetlands, land or subsurface strata, or
otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport
or handling of pollutants, contaminants, chemicals or toxic
or hazardous substances or wastes.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the
regulations promulgated and rulings issued thereunder.
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"ERISA Affiliate" means any corporation or trade or
business that is a member of any group of organizations (i)
described in Section 414(b) or (c) of the Code of which the
Borrower is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and
Section 412(c)(11) of the Code and the lien created under
Section 302(f) of ERISA and Section 412(n) of the Code,
described in Section 414(m) or (o) of the Code of which the
Borrower is a member.
"Eurocurrency Liabilities" has the meaning assigned to
that term in Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any
Lender, the office of such Lender specified as its
"Eurodollar Lending Office" opposite its name on Schedule I
hereto or in the Assignment and Acceptance pursuant to which
it became a Lender (or, if no such office is specified, its
Domestic Lending Office), or such other office of such
Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
"Eurodollar Rate" means, for any Interest Period for
each Eurodollar Rate Advance comprising part of the same
A Borrowing, an interest rate per annum equal to the average
(rounded upward to the nearest whole multiple of 1/16 of 1%
per annum, if such average is not such a multiple) of the
rate per annum at which deposits in U.S. dollars are offered
by the principal office of each of the Reference Banks in
London, England to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period in an amount
substantially equal to such Reference Bank's Eurodollar Rate
Advance comprising part of such A Borrowing and for a period
equal to such Interest Period. The Eurodollar Rate for any
Interest Period for each Eurodollar Rate Advance comprising
part of the same A Borrowing shall be determined by the
Administrative Agent on the basis of applicable rates
furnished to and received by the Administrative Agent from
the Reference Banks two Business Days before the first day
of such Interest Period, subject, however, to the provisions
of Section 2.09.
"Eurodollar Rate Advance" means an A Advance which
bears interest as provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" of any Lender for
any Interest Period for any Eurodollar Rate Advance means
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the reserve percentage applicable during such Interest
Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those
days in such Interest Period during which any such
percentage shall be so applicable) under regulations issued
from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the
maximum reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve
requirement) for such Lender with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.
"Events of Default" has the meaning specified in
Section 6.01.
"Facility Fee" has the meaning specified in
Section 2.04(a).
"Federal Funds Rate" means, for any period, a
fluctuating interest rate per annum equal for each day
during such period to the weighted average of the rates on
overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average
of the quotations for such day on such transactions received
by the Administrative Agent from three Federal funds brokers
of recognized standing selected by it.
"Interest Period" means, with respect to any Eurodollar
Rate Advance comprising part of the same A Borrowing, the
period beginning on the date such Eurodollar Rate Advance is
made or Converted from a Base Rate Advance and ending on the
last day of the period selected by the Borrower pursuant to
the provisions below and, thereafter, each subsequent period
beginning on the last day of the immediately preceding
Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below.
The duration of each such Interest Period shall be one, two,
three or six months, as the Borrower may, upon notice
received by the Administrative Agent not later than
11:00 A.M. (New York City time) on the third Business Day
prior to the first day of such Interest Period, select;
provided, however, that:
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(i) the Borrower may not select any Interest
Period that ends after the Termination Date;
(ii) Interest Periods beginning on the same date
for Eurodollar Rate Advances comprising part of the
same A Borrowing shall be of the same duration;
(iii) each Interest Period that begins on the last
Business Day of a calendar month (or on any day for
which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall end on the
last Business Day of the appropriate subsequent
calendar month; and
(iv) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business
Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day,
provided that, if such extension would cause the last
day of such Interest Period to occur in the next
following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day.
"Lenders" means the Banks listed on the signature pages
hereof, each Person that shall become a party hereto
pursuant to Section 8.07(a), (b) and (c), and, except when
used in reference to an A Advance, an A Borrowing, an A
Note, a Commitment or a related term, each Designated
Bidder.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any
agreement to give any of the foregoing, any conditional sale
or other title retention agreement, any lease in the nature
thereof, and the filing of or agreement to give any
financing statement under the Uniform Commercial Code of any
jurisdiction); provided that no Lien shall be deemed to
arise solely by reason of any sale by the Borrower or any
Subsidiary of accounts receivable or the filing of or
agreement to give any financing statement in connection
therewith, so long as such sale is without recourse
(a) except for the Borrower's repurchase obligation for
indemnities customarily provided therein, (b) except to the
extent that the obligation to repurchase unpaid receivables
does not exceed 10%, or (c) except to the extent that the
over-collateralization of accounts receivables sold does not
exceed 20% of the total accounts receivables sold.
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"Majority Lenders" means at any time Lenders holding
more than 66-2/3% of the then aggregate unpaid principal
amount of the A Advances held by Lenders, or, if no such
principal amount is then outstanding, Lenders having at
least 66-2/3% of the Commitments.
"Moody's" means Moody's Investors Service, Inc. and its
successors.
"Multiemployer Plan" means a multiemployer plan defined
as such in Section 3(37) of ERISA to which contributions
have been made by the Borrower or any ERISA Affiliate and
that is covered by Title IV of ERISA.
"Note" means an A Note or a B Note.
"Notice of A Borrowing" has the meaning specified in
Section 2.02(a).
"Notice of B Borrowing" has the meaning specified in
Section 2.03(a).
"OECD" means the Organization for Economic Cooperation
and Development.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity,
or a government or any political subdivision or agency
thereof.
"Plan" means an employee benefit or other plan
established or maintained by the Borrower or any ERISA
Affiliate and that is covered by Title IV of ERISA, other
than a Multiemployer Plan.
"Principal Asset" means: (a) any asset of the Borrower
or any Subsidiary of the Borrower, other than an asset that
the Board of Directors of the Borrower reasonably determines
(such determination being made prior to the incurrence of
any Lien thereon or any sale and lease-back transaction with
respect thereto) is not of material importance to the
business conducted by the Borrower and its Subsidiaries,
taken as a whole; and (b) any other asset of the Borrower or
any Subsidiary of the Borrower having an aggregate net book
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value of $50,000,000 or more; provided that in any event
(x) all current assets of the Borrower and its Subsidiaries
shall be Principal Assets and (y) all capital stock of the
Borrower's Subsidiaries shall be Principal Assets.
"Rated Securities" means, at any time, the unsecured,
unguaranteed long-term senior debt securities of the
Borrower outstanding at such time.
"Rating Level 1 Period" means a period during which
each of the following is true: (i) the Moody's rating then
in effect with respect to the Rated Securities is equal to
or better than Baa1, and (ii) the Standard & Poor's rating
then in effect with respect to the Rated Securities is equal
to or better than BBB+.
"Rating Level 2 Period" means a period (other than a
Rating Level 1 Period) during which each of the following is
true: (i) the Moody's rating then in effect with respect to
the Rated Securities is equal to or better than Baa3, and
(ii) the Standard & Poor's rating then in effect with
respect to the Rated Securities is equal to or better than
BBB-.
"Rating Level 3 Period" means each period other than a
Rating Level 1 Period or a Rating Level 2 Period, and shall
include each period during which either or both of Moody's
or Standard & Poor's shall not have in effect a rating for
the Rated Securities (other than because such rating agency
shall no longer be in the business of rating corporate debt
obligations).
"Rating Level Change" means a change in the rating of
the Rated Securities by either or both of Moody's or
Standard & Poor's (other than as a result of a change in the
rating system of such rating agency) that results in the
change from one Rating Level Period to another, which Rating
Level Change shall be effective on the date on which the
relevant change in the rating of the Rated Securities is
first announced by Moody's or Standard & Poor's, as the case
may be.
"Rating Level Period" shall mean a Rating Level 1
Period, a Rating Level 2 Period or a Rating Level 3 Period.
"Reference Banks" means Citibank, The First National
Bank of Chicago and Union Bank of Switzerland, Chicago
Branch.
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"Register" has the meaning specified in
Section 8.07(g).
"Reportable Event" shall have the meaning set forth in
Title IV of ERISA.
"Standard & Poor's" shall mean Standard & Poor's
Ratings Group, presently a division of McGraw-Hill, Inc.,
and its successors.
"Subsidiary" or "Subsidiaries" means any corporation
more than fifty percent (50%) of the capital stock of which
is owned or controlled, directly or indirectly, by the
Borrower and/or any Subsidiary of the Borrower and whose
accounts are required to be consolidated with those of the
Borrower in accordance with generally accepted accounting
principles, consistently applied.
"Tax-Free Financing" shall mean any "private activity
bond" as defined in Section 141(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), which is a "qualified
bond" as defined in Section 141(e)(1) of the Code, (ii) any
"securities acquisition loan" as defined in Section 133(b)
of the Code, and (iii) any other financing, the interest on
the indebtedness issued in connection with which is exempt
in whole or in part from Federal income tax.
"Termination Date" means August 31, 1999 or the earlier
date of termination in whole of the Commitments pursuant to
Section 2.05 or 6.01.
"Utilization Fee" has the meaning specified in
Section 2.04(b).
"Voting Stock" shall mean all outstanding securities of
the Borrower entitled to vote generally in the election of
directors of the Borrower at the time in question.
SECTION 1.02. Computation of Time Periods. In this
Agreement in the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but
excluding".
SECTION 1.03. Accounting Terms. All accounting terms
not specifically defined herein shall be construed in accordance
with generally accepted accounting principles consistent with
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those applied in the preparation of the financial statements
referred to in Section 4.01(e).
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The A Advances. Each Lender severally
agrees, on the terms and conditions hereinafter set forth, to
make A Advances to the Borrower from time to time on any Business
Day during the period from the date hereof until the Termination
Date in an aggregate amount not to exceed at any time outstanding
the amount set opposite such Lender's name on the signature pages
hereof or, if such Lender has entered into any Assignment and
Acceptance, set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to Section 8.07(c), as such
amount may be reduced pursuant to Section 2.05 (such Lender's
"Commitment"), provided that the aggregate amount of the
Commitments of the Lenders shall be deemed used from time to time
to the extent of the aggregate amount of the B Advances then
outstanding and such deemed use of the aggregate amount of the
Commitments shall be deemed applied to the Lenders ratably
according to their respective Commitments (such deemed use of the
aggregate amount of the Commitments being a "B Reduction"). Each
A Borrowing shall be in an aggregate amount not less than
$10,000,000 or an integral multiple of $5,000,000 in excess
thereof and shall consist of A Advances of the same Type made on
the same day by the Lenders ratably according to their respective
Commitments. Within the limits of each Lender's Commitment, the
Borrower may from time to time borrow, prepay pursuant to
Section 2.11(b) and reborrow under this Section 2.01.
SECTION 2.02. Making the A Advances.
(a) Each A Borrowing shall be made on notice, given
not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed A Borrowing (in
the case of an A Borrowing consisting of Eurodollar Rate
Advances) or given not later than 11:00 A.M. (New York City time)
on the Business Day of the proposed A Borrowing (in the case of
an A Borrowing consisting of Base Rate Advances), by the Borrower
to the Administrative Agent, which shall give to each Lender
prompt notice thereof by telecopier, telex or cable. Each such
notice of an A Borrowing (a "Notice of A Borrowing") shall be by
telecopier, telex or cable, confirmed immediately in writing, in
substantially the form of Exhibit B-1 hereto, specifying therein
the requested (i) date of such A Borrowing, (ii) Type of
A Advances comprising such A Borrowing, (iii) aggregate amount of
such A Borrowing, and (iv) in the case of an A Borrowing
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consisting of Eurodollar Rate Advances, initial Interest Period
for each such A Advance. Each Lender shall, before 1:00 P.M.
(New York City time) on the date of such A Borrowing, make
available for the account of its Applicable Lending Office to the
Administrative Agent at its address referred to in Section 8.02,
in same day funds, such Lender's ratable portion of such A
Borrowing. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth
in Article III, the Administrative Agent will make such funds
available to the Borrower at the Administrative Agent's aforesaid
address.
(b) Anything in subsection (a) above to the contrary
notwithstanding, the Borrower may not select Eurodollar Rate
Advances for any A Borrowing if the aggregate amount of such
A Borrowing is less than $10,000,000.
(c) Each Notice of A Borrowing shall be irrevocable
and binding on the Borrower. In the case of any A Borrowing
which the related Notice of A Borrowing specifies is to be
comprised of Eurodollar Rate Advances, the Borrower shall
indemnify each Lender against any loss, cost or expense incurred
by such Lender as a result of any failure to fulfill on or before
the date specified in such Notice of A Borrowing for such
A Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss (including loss of
anticipated profits not to exceed 15 basis points on the
principal amount of such A Borrowing), cost or expense incurred
by reason of the liquidation or reemployment of deposits or other
funds acquired by such Lender to fund the A Advance to be made by
such Lender as part of such A Borrowing when such A Advance, as a
result of such failure, is not made on such date.
(d) Unless the Administrative Agent shall have
received notice from a Lender prior to the date of any A
Borrowing that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of such A
Borrowing, the Administrative Agent may assume that such Lender
has made such portion available to the Administrative Agent on
the date of such A Borrowing in accordance with subsection (a) of
this Section 2.02 and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower on such date
a corresponding amount. If and to the extent that such Lender
shall not have so made such ratable portion available to the
Administrative Agent, such Lender and the Borrower severally
agree to repay to the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for
each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the
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Administrative Agent, at (i) in the case of the Borrower, the
interest rate applicable at the time to A Advances comprising
such A Borrowing and (ii) in the case of such Lender, the Federal
Funds Rate. If such Lender shall repay to the Administrative
Agent such corresponding amount, such amount so repaid shall
constitute such Lender's A Advance as part of such A Borrowing
for purposes of this Agreement.
(e) The failure of any Lender to make the A Advance to
be made by it as part of any A Borrowing shall not relieve any
other Lender of its obligation, if any, hereunder to make its
A Advance on the date of such A Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the
A Advance to be made by such other Lender on the date of any
A Borrowing.
SECTION 2.03. The B Advances.
(a) Each Lender severally agrees that the Borrower may
request B Borrowings under this Section 2.03 from time to time on
any Business Day during the period from the date hereof until the
date occurring 30 days prior to the Termination Date in the
manner set forth below; provided that, following the making of
each B Borrowing, the aggregate amount of the Advances then
outstanding shall not exceed the aggregate amount of the
Commitments of the Lenders (computed without regard to any
B Reduction).
(i) The Borrower may request a B Borrowing under this
Section 2.03 by delivering to the Administrative Agent, by
telecopier, telex or cable, confirmed immediately in
writing, a notice of a B Borrowing (a "Notice of B
Borrowing"), in substantially the form of Exhibit B-2
hereto, specifying the date and aggregate amount of the
proposed B Borrowing, the maturity date for repayment of
each B Advance to be made as part of such B Borrowing (which
maturity date may not be earlier than the date occurring 30
days after the date of such B Borrowing or later than the
Termination Date), the interest payment date or dates
relating thereto, and any other terms to be applicable to
such B Borrowing, not later than 10:00 A.M. (New York City
time) (A) at least one Business Day prior to the date of the
proposed B Borrowing, if the Borrower shall specify in the
Notice of B Borrowing that the rates of interest to be
offered by the Lenders shall be fixed rates per annum and
(B) at least four Business Days prior to the date of the
proposed B Borrowing, if the Borrower shall instead specify
in the Notice of B Borrowing the basis to be used by the
Lenders in determining the rates of interest to be offered
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by them. Simultaneously with each such request, the
Borrower shall pay to the Administrative Agent, for the
Administrative Agent's account, a non-refundable fee in the
amount of $3,000. Promptly following the Administrative
Agent's receipt of such request and the fee referred to in
the preceding sentence, the Administrative Agent shall
notify each Lender of such request for a B Borrowing
received by it from the Borrower by sending such Lender a
copy of the related Notice of B Borrowing.
(ii) Each Lender may, if, in its sole discretion, it
elects to do so, irrevocably offer to make one or more
B Advances to the Borrower as part of such proposed
B Borrowing at a rate or rates of interest specified by such
Lender in its sole discretion, by notifying the
Administrative Agent (which shall give prompt notice thereof
to the Borrower), before 10:00 A.M. (New York City time)
(A) on the date of such proposed B Borrowing, in the case of
a Notice of B Borrowing delivered pursuant to clause (A) of
paragraph (i) above and (B) three Business Days before the
date of such proposed B Borrowing, in the case of a Notice
of B Borrowing delivered pursuant to clause (B) of paragraph
(i) above, of the minimum amount and maximum amount of each
B Advance which such Lender would be willing to make as part
of such proposed B Borrowing (which amounts may, subject to
the proviso to the first sentence of this Section 2.03(a),
exceed such Lender's Commitment, if any), the rate or rates
of interest therefor and such Lender's Applicable Lending
Office with respect to such B Advance; provided that if the
Administrative Agent in its capacity as a Lender shall, in
its sole discretion, elect to make any such offer, it shall
notify the Borrower of such offer before 9:00 A.M. (New York
City time) on the date on which notice of such election is
to be given to the Administrative Agent by the other
Lenders. If any Lender shall elect not to make such an
offer, such Lender shall so notify the Administrative Agent,
before 10:00 A.M. (New York City time) on the date on which
notice of such election is to be given to the Administrative
Agent by the other Lenders, and such Lender shall not be
obligated to, and shall not, make any B Advance as part of
such B Borrowing; provided that the failure by any Lender to
give such notice shall not cause such Lender to be obligated
to make any B Advance as part of such proposed B Borrowing.
(iii) The Borrower shall, in turn, (A) before 11:00 A.M.
(New York City time) on the date of such proposed
B Borrowing, in the case of a Notice of B Borrowing
delivered pursuant to clause (A) of paragraph (i) above and
(B) before 1:00 P.M. (New York City time) three Business
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Days before the date of such proposed B Borrowing, in the
case of a Notice of B Borrowing delivered pursuant to clause
(B) of paragraph (i) above, either:
(x) cancel such B Borrowing by giving the
Administrative Agent notice to that effect, or
(y) accept one or more of the offers made by any
Lender or Lenders pursuant to paragraph (ii) above, in
its sole discretion, by giving notice to the
Administrative Agent of the amount of each B Advance
(which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum
amount, notified to the Borrower by the Administrative
Agent on behalf of such Lender for such B Advance
pursuant to paragraph (ii) above) to be made by each
Lender as part of such B Borrowing, and reject any
remaining offers made by Lenders pursuant to paragraph
(ii) above by giving the Administrative Agent notice to
that effect.
(iv) If the Borrower notifies the Administrative Agent
that such B Borrowing is canceled pursuant to paragraph
(iii)(x) above, the Administrative Agent shall give prompt
notice thereof to the Lenders and such B Borrowing shall not
be made.
(v) If the Borrower accepts one or more of the offers
made by any Lender or Lenders pursuant to paragraph (iii)(y)
above, the Administrative Agent shall in turn promptly
notify (A) each Lender that has made an offer as described
in paragraph (ii) above, of the date and aggregate amount of
such B Borrowing and whether or not any offer or offers made
by such Lender pursuant to paragraph (ii) above have been
accepted by the Borrower, (B) each Lender that is to make a
B Advance as part of such B Borrowing, of the amount of each
B Advance to be made by such Lender as part of such B
Borrowing, and (C) each Lender that is to make a B Advance
as part of such B Borrowing, upon receipt, that the
Administrative Agent has received forms of documents
appearing to fulfill the applicable conditions set forth in
Article III. Each Lender that is to make a B Advance as
part of such B Borrowing shall, before 12:00 noon (New York
City time) on the date of such B Borrowing specified in the
notice received from the Administrative Agent pursuant to
clause (A) of the preceding sentence or any later time when
such Lender shall have received notice from the
Administrative Agent pursuant to clause (C) of the preceding
sentence, make available for the account of its Applicable
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Lending Office to the Administrative Agent at its address
referred to in Section 8.02 such Lender's portion of such
B Borrowing, in same day funds. Upon fulfillment of the
applicable conditions set forth in Article III and after
receipt by the Administrative Agent of such funds, the
Administrative Agent will make such funds available to the
Borrower at the Administrative Agent's aforesaid address.
Promptly after each B Borrowing the Administrative Agent
will notify each Lender of the amount of the B Borrowing,
the consequent B Reduction and the dates upon which such B
Reduction commenced and will terminate.
(b) Each B Borrowing shall be in an aggregate amount
not less than $10,000,000 or an integral multiple of $5,000,000
in excess thereof, but no B Borrowing shall be made if, following
the making of such B Borrowing, the Borrower would not be in
compliance with the limitation set forth in the proviso to the
first sentence of subsection (a) above.
(c) Within the limits and on the conditions set forth
in this Section 2.03, the Borrower may from time to time borrow
under this Section 2.03, repay pursuant to subsection (d) below,
and reborrow under this Section 2.03, provided that a B Borrowing
shall not be made within three Business Days of the date of any
other B Borrowing.
(d) The Borrower shall repay to the Administrative
Agent for the account of each Lender which has made a B Advance,
or each other holder of a B Note, on the maturity date of each
B Advance (such maturity date being that specified by the
Borrower for repayment of such B Advance in the related Notice of
B Borrowing delivered pursuant to subsection (a)(i) above and
provided in the B Note evidencing such B Advance), the then
unpaid principal amount of such B Advance. The Borrower shall
have no right to prepay any principal amount of any B Advance.
(e) The Borrower shall pay interest on the unpaid
principal amount of each B Advance from the date of such B
Advance to the date the principal amount of such B Advance is
repaid in full, at the rate of interest for such B Advance
specified by the Lender making such B Advance in its notice with
respect thereto delivered pursuant to subsection (a)(ii) above,
payable on the interest payment date or dates specified by the
Borrower for such B Advance in the related Notice of B Borrowing
delivered pursuant to subsection (a)(i) above, as provided in the
B Note evidencing such B Advance.
(f) The indebtedness of the Borrower resulting from
each B Advance made to the Borrower as part of a B Borrowing
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shall be evidenced by a separate B Note of the Borrower payable
to the order of the Lender making such B Advance.
SECTION 2.04. Certain Fees.
(a) Facility Fee.
(i) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender (other than the Designated
Bidders) a facility fee (the "Facility Fee") on the average daily
amount (whether used or unused) of such Lender's Commitment (and,
from and after the Termination Date, on the aggregate principal
amount of such Lender's Advances outstanding from time to time)
from the date hereof (in the case of each Bank) and from the
effective date specified in the Assignment and Acceptance
pursuant to which it became a Lender (in the case of each such
Lender) until the later of (i) the Termination Date and (ii) the
date such Lender's Advances are paid in full, at a rate per annum
equal to: (x) 0.12 of one percent during any Rating Level 1
Period; (y) 0.15 of one percent during any Rating Level 2 Period;
and (z) 0.20 of one percent during any Rating Level 3 Period.
(ii) Accrued Facility Fee shall be paid on the first
day of each January, April, July and October, on the Termination
Date and (if later) on the date such Lender's Advances are paid
in full.
(iii) Each change in the rate of Facility Fee payable
pursuant to Section 2.04(a)(i) resulting from a Rating Level
Change shall be effective on the date of such Rating Level
Change.
(b) Utilization Fee. The Borrower agrees to pay to
the Administrative Agent for the account of each Lender (other
than the Designated Bidders) a utilization fee (the "Utilization
Fee") on the aggregate unpaid principal amount of the Advances of
such Lender for each day on which the aggregate unpaid principal
amount of the Advances equals or exceeds 50% of the aggregate
amount of the Commitments as then in effect, at a rate per annum
equal to 0.125 of one percent. Accrued Utilization Fee shall be
paid on the first day of each January, April, July and October,
on the Termination Date and (if later) on the date such Lender's
Advances are paid in full.
(c) Administrative Agent's Fee. The Borrower
acknowledges its agreement to pay to the Administrative Agent,
for the Administrative Agent's own account, an administrative
agency fee at the times and in the amounts heretofore agreed
between the Borrower and the Administrative Agent.
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SECTION 2.05. Reduction of the Commitments. The
Borrower shall have the right, upon at least three Business Days'
notice to the Administrative Agent, to terminate in whole or
reduce ratably in part the unused portions of the respective
Commitments of the Lenders, provided that the aggregate amount of
the Commitments of the Lenders shall not be reduced to an amount
which is less than the aggregate principal amount of the Advances
then outstanding, and provided further that each partial
reduction shall be in an aggregate amount of $10,000,000 or an
integral multiple of $1,000,000 in excess thereof.
SECTION 2.06. Repayment of A Advances. The Borrower
shall repay the principal amount of each A Advance made by each
Lender in accordance with the A Note to the order of such Lender.
SECTION 2.07. Interest on A Advances.
(a) Ordinary Interest. The Borrower shall pay
interest on the unpaid principal amount of each A Advance made by
each Lender from the date of such A Advance until such principal
amount shall be paid in full, at the following rates per annum:
(i) Base Rate Advances. If such A Advance is a Base
Rate Advance, a rate per annum equal at all times to the
Base Rate in effect from time to time plus the Applicable
Margin for Base Rate Advances as in effect from time to
time, payable quarterly in arrears on the first day of each
January, April, July and October during such period and on
the date such Base Rate Advance shall be Converted or paid
in full.
(ii) Eurodollar Rate Advances. If such A Advance is a
Eurodollar Rate Advance, a rate per annum equal at all times
during the Interest Period for such A Advance to the sum of
the Eurodollar Rate for such Interest Period plus the
Applicable Margin for Eurodollar Rate Advances as in effect
from time to time, payable on the last day of such Interest
Period and, if such Interest Period has a duration of more
than three months, on each day which occurs during such
Interest Period every three months from the first day of
such Interest Period, and on the date such Eurodollar Rate
Advance shall be Converted or paid in full.
(b) Default Interest. The Borrower shall pay interest
on the unpaid principal amount of each Advance that is not paid
when due (whether at stated maturity, by acceleration or
otherwise), and on the unpaid amount of all interest, fees and
other amounts payable hereunder that is not paid when due,
payable on demand, at a rate per annum during the period from
the
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due date thereof to the date on which such amount is paid in full
equal to (i) in the case of any amount of principal of such
Advance, 2% plus the rate which would otherwise be applicable to
such Advance, and (ii) in the case of all other amounts, 2% plus
Base Rate as in effect from time to time.
SECTION 2.08. Additional Interest on Eurodollar Rate
Advances. The Borrower shall pay to each Lender, so long as such
Lender shall be required under regulations of the Board of
Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, additional interest on the unpaid
principal amount of each Eurodollar Rate Advance of such Lender,
from the date of such Eurodollar Rate Advance until such
principal amount is paid in full, at an interest rate per annum
equal at all times to the remainder obtained by subtracting
(i) the Eurodollar Rate for the Interest Period for such
Eurodollar Rate Advance from (ii) the rate obtained by dividing
such Eurodollar Rate by a percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage of such Lender for such
Interest Period, payable on each date on which interest is
payable on such Eurodollar Rate Advance. Such additional
interest shall be determined by such Lender and notified to the
Borrower through the Administrative Agent.
SECTION 2.09. Interest Rate Determinations; Changes in
Rating Systems.
(a) Each Reference Bank agrees to furnish to the
Administrative Agent timely information for the purpose of
determining each Eurodollar Rate. If any one or more of the
Reference Banks shall not furnish such timely information to the
Administrative Agent for the purpose of determining any such
interest rate, the Administrative Agent shall determine such
interest rate on the basis of timely information furnished by the
remaining Reference Banks.
(b) The Administrative Agent shall give prompt notice
to the Borrower and the Lenders of the applicable interest rate
determined by the Administrative Agent for purposes of
Section 2.07(a)(i) or (ii), and the applicable rate, if any,
furnished by each Reference Bank for the purpose of determining
the applicable interest rate under Section 2.07(a)(ii).
(c) If fewer than two Reference Banks furnish timely
information to the Administrative Agent for determining the
Eurodollar Rate for any Eurodollar Rate Advances,
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(i) the Administrative Agent shall forthwith notify
the Borrower and the Lenders that the interest rate cannot
be determined for such Eurodollar Rate Advances,
(ii) each Eurodollar Rate Advance will automatically,
on the last day of the then existing Interest Period
therefor, Convert into a Base Rate Advance, and
(iii) the obligation of the Lenders to make, or to
Convert A Advances into, Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
(d) If, with respect to any Eurodollar Rate Advances,
the Majority Lenders notify the Administrative Agent that the
Eurodollar Rate for any Interest Period for such Advances will
not adequately reflect the cost to such Majority Lenders of
making, funding or maintaining their respective Eurodollar Rate
Advances for such Interest Period, the Administrative Agent shall
forthwith so notify the Borrower and the Lenders, whereupon
(i) each Eurodollar Rate Advance will automatically,
on the last day of the then existing Interest Period
therefor, Convert into a Base Rate Advance, and
(ii) the obligation of the Lenders to make, or to
Convert A Advances into, Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the
Borrower and such Lenders that the circumstances causing
such suspension no longer exist.
(e) If the Borrower shall fail to select the duration
of any Interest Period for any Eurodollar Rate Advances in
accordance with the provisions contained in the definition of
"Interest Period" in Section 1.01, the Administrative Agent will
forthwith so notify the Borrower and the Lenders and such
Advances will automatically, on the last day of the then existing
Interest Period therefor, Convert into Base Rate Advances.
(f) If the rating system of either Moody's or Standard
& Poor's shall change, or if either such rating agency shall
cease to be in the business of rating corporate debt obligations,
the Borrower and the Administrative Agent (on behalf of the
Lenders) shall negotiate in good faith to amend the references to
specific ratings in this Agreement to reflect such changed rating
system or the non-availability of ratings from such rating agency
(provided that any such amendment to such specific ratings shall
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in no event be effective without the approval of the Majority
Lenders).
SECTION 2.10. Voluntary Conversion of A Advances. The
Borrower may on any Business Day, upon notice given to the
Administrative Agent not later than 11:00 A.M. (New York City
time) on the third Business Day prior to the date of the proposed
Conversion and subject to the provisions of Sections 2.09 and
2.13, Convert all A Advances of one Type comprising the same
A Borrowing into Advances of the other Type; provided, however,
that any Conversion of any Eurodollar Rate Advances into Base
Rate Advances shall be made on, and only on, the last day of an
Interest Period for such Eurodollar Rate Advances. Each such
notice of a Conversion shall, within the restrictions specified
above, specify (i) the date of such Conversion, (ii) the
A Advances to be Converted, and (iii) if such Conversion is into
Eurodollar Rate Advances, the duration of the initial Interest
Period for each such A Advance.
SECTION 2.11. Prepayments of A Advances.
(a) The Borrower shall have no right to prepay any
principal amount of any A Advances other than as provided in
subsection (b) below.
(b) The Borrower may, upon at least one Business Days'
notice to the Administrative Agent stating the proposed date and
aggregate principal amount of the prepayment, and if such notice
is given the Borrower shall, prepay the outstanding principal
amounts of the Advances comprising part of the same A Borrowing
in whole or ratably in part, together with accrued interest to
the date of such prepayment on the principal amount prepaid;
provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount not less than $10,000,000 or
integral multiples of $1,000,000 in excess thereof and (y) in the
case of any such prepayment of a Eurodollar Rate Advance, the
Borrower shall, on the date of such prepayment, reimburse the
Lenders in respect thereof pursuant to Section 8.04(c).
SECTION 2.12. Increased Costs.
(a) If, due to either (i) the introduction of or any
change (other than any change by way of imposition or increase of
reserve requirements included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation
or (ii) the compliance with any guideline or request from any
central bank or other governmental authority (whether or not
having the force of law), there shall be any increase in the cost
to any Lender of agreeing to make or making, funding or
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maintaining Eurodollar Rate Advances, then the Borrower shall
from time to time, upon demand by such Lender (with a copy of
such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender additional
amounts sufficient to compensate such Lender for such increased
cost. A certificate as to the amount of such increased cost,
submitted to the Borrower and the Administrative Agent by such
Lender, shall be conclusive and binding for all purposes, absent
manifest error.
(b) If any Lender (other than a Designated Bidder)
determines that compliance with any law or regulation or any
guideline or request from any central bank or other governmental
authority (whether or not having the force of law) affects or
would affect the amount of capital required or expected to be
maintained by such Lender or any corporation controlling such
Lender and that the amount of such capital is increased by or
based upon the existence of such Lender's commitment to lend
hereunder and other commitments of this type, then, upon demand
by such Lender (with a copy of such demand to the Administrative
Agent), the Borrower shall immediately pay to the Administrative
Agent for the account of such Lender, from time to time as
specified by such Lender, additional amounts sufficient to
compensate such Lender or such corporation in the light of such
circumstances, to the extent that such Lender reasonably
determines such increase in capital to be allocable to the
existence of such Lender's commitment to lend hereunder. A
certificate as to such amounts submitted to the Borrower and the
Administrative Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 2.13. Illegality. Notwithstanding any other
provision of this Agreement, if any Lender shall notify the
Administrative Agent that the introduction of or any change in or
in the interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts that
it is unlawful, for the Lender or its Eurodollar Lending Office
to perform its obligations hereunder to make Eurodollar Rate
Advances or to fund or maintain Eurodollar Rate Advances
hereunder, (i) the obligation of the Lenders to make, or to
Convert A Advances into, Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such
suspension no longer exist and (ii) the Borrower shall forthwith
prepay in full all Eurodollar Rate Advances of all Lenders then
outstanding, together with interest accrued thereon, unless the
Borrower, within five Business Days of notice from the
Administrative Agent, Converts all Eurodollar Rate Advances of
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all the Lenders then outstanding into Base Rate Advances in
accordance with Section 2.10.
SECTION 2.14. Payments and Computations.
(a) The Borrower shall make each payment hereunder and
under the Notes not later than 12:00 P.M. (New York City time) on
the day when due in U.S. dollars to the Administrative Agent at
its address referred to in Section 8.02 in same day funds. The
Administrative Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal,
interest, Facility Fees or Utilization Fees ratably (other than
amounts payable pursuant to Section 2.03, 2.08, 2.12 or 2.15) to
the Lenders for the account of their respective Applicable
Lending Offices, and like funds relating to the payment of any
other amount payable to any Lender to such Lender for the account
of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance
of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 8.07(c),
from and after the effective date specified in such Assignment
and Acceptance, the Administrative Agent shall make all payments
hereunder and under the Notes in respect of the interest assigned
thereby to the Lender assignee thereunder, and the parties to
such Assignment and Acceptance shall make all appropriate
adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes each Lender, if and
to the extent payment owed to such Lender is not made when due
hereunder or under any Note held by such Lender, to charge from
time to time against any or all of the Borrower's accounts with
such Lender any amount so due.
(c) All computations of interest based on Citibank's
base rate shall be made by the Administrative Agent on the basis
of a year of 365 or 366 days, as the case may be, and all
computations of interest based on the Eurodollar Rate or the
Federal Funds Rate and of Facility Fees and Utilization Fees
shall be made by the Administrative Agent, and all computations
of interest pursuant to Section 2.08 shall be made by a Lender,
on the basis of a year of 360 days, in each case for the actual
number of days (including the first day but excluding the last
day) occurring in the period for which such interest, Facility
Fees or Utilization Fees are payable. Each determination by the
Administrative Agent (or, in the case of Section 2.08, by a
Lender) of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
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(d) Whenever any payment hereunder or under the Notes
shall be stated to be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day,
and such extension of time shall in such case be included in the
computation of payment of interest, Facility Fee or Utilization
Fee, as the case may be; provided, however, if such extension
would cause payment of interest on or principal of Eurodollar
Rate Advances to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day.
(e) Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any
payment is due to the Lenders hereunder that the Borrower will
not make such payment in full, the Administrative Agent may
assume that the Borrower has made such payment in full to the
Administrative Agent on such date and the Administrative Agent
may, in reliance upon such assumption, cause to be distributed to
each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent that the Borrower shall
not have so made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender
repays such amount to the Administrative Agent, at the Federal
Funds Rate.
SECTION 2.15. Taxes.
(a) Any and all payments by the Borrower hereunder or
under the Notes shall be made, in accordance with Section 2.14,
free and clear of and without deduction for any and all present
or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto,
excluding, in the case of each Lender and the Administrative
Agent, taxes imposed on its income, and franchise taxes imposed
on it, by the jurisdiction under the laws of which such Lender or
the Administrative Agent (as the case may be) is organized or any
political subdivision thereof and, in the case of each Lender,
taxes imposed on its income, and franchise taxes imposed on it,
by the jurisdiction of such Lender's Applicable Lending Office or
any political subdivision thereof (all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder or under any Note to any
Lender or the Administrative Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums
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payable under this Section 2.15) such Lender or the
Administrative 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 and
(iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with
applicable law.
(b) In addition, the Borrower agrees to pay any
present or future stamp or documentary taxes or any other excise
or property taxes, charges or similar levies which arise from any
payment made hereunder or under the Notes or from the execution,
delivery or registration of, or otherwise with respect to, this
Agreement or the Notes (hereinafter referred to as "Other
Taxes").
(c) The Borrower will indemnify each Lender and the
Administrative Agent for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed
by any jurisdiction on amounts payable under this Section 2.15)
paid by such Lender or the Administrative Agent (as the case may
be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or
not such Taxes or Other Taxes were correctly or legally asserted.
Such Lender or the Administrative Agent (as the case may be) will
use reasonable efforts to contest such a Tax or Other Tax that
is, in its opinion, incorrectly asserted. This indemnification
shall be made within 30 days from the date such Lender or the
Administrative Agent (as the case may be) makes written demand
therefor.
(d) Within 30 days after the date of any payment of
Taxes, the Borrower will furnish to the Administrative Agent, at
its address referred to in Section 8.02, the original or a
certified copy of a receipt evidencing payment thereof. If no
Taxes are payable in respect of any payment hereunder or under
the Notes, the Borrower will furnish to the Administrative Agent,
at such address, a certificate from each appropriate taxing
authority, or an opinion of counsel acceptable to the
Administrative Agent, in either case stating that such payment is
exempt from or not subject to Taxes.
(e) Each Lender 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) and on the date of the Assignment and Acceptance
pursuant to which it becomes a Lender (in the case of each other
Lender), and from time to time thereafter if requested in writing
by the Borrower (but only so long as such Lender remains
lawfully
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able to do so), shall provide the Borrower with Internal Revenue
Service form 1001 or 4224, as appropriate, or any successor form
prescribed by the Internal Revenue Service, certifying that such
Lender 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 Lender at the time such Lender
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 2.15(a).
(f) For any period with respect to which a Lender has
failed to provide the Borrower with the appropriate form
described in Section 2.15(e) (other than if such failure is due
to a change in law occurring subsequent to the date on which a
form originally was required to be provided, or if such form
otherwise is not required under the first sentence of subsection
(e) above), such Lender shall not be entitled to indemnification
under Section 2.15(a) with respect to Taxes imposed by the United
States; provided, however, that should a Lender become subject to
Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as the Lender shall
reasonably request to assist the Lender to recover such Taxes.
SECTION 2.16. Sharing of Payments, Etc. If any Lender
shall obtain any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) on account of
the A Advances made by it (other than pursuant to Section 2.08,
2.12 or 2.15) in excess of its ratable share of payments on
account of the A Advances obtained by all the Lenders, such
Lender shall forthwith purchase from the other Lenders such
participations in the A Advances made by them as shall be
necessary to cause such purchasing Lender to share the excess
payment ratably with each of them, provided, however, that if all
or any portion of such excess payment is thereafter recovered
from such purchasing Lender, such purchase from each Lender shall
be rescinded and such Lender shall repay to the purchasing Lender
the purchase price to the extent of such recovery together with
an amount equal to such Lender's ratable share (according to the
proportion of (i) the amount of such Lender's required repayment
to (ii) the total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered. The
Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 2.16 may, to the
fullest extent permitted by law, exercise all its rights of
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payment (including the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor
of the Borrower in the amount of such participation.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Condition Precedent to Effectiveness of
Sections 2.01 and 2.03. The effectiveness of Sections 2.01 and
2.03 is subject to the condition precedent that the
Administrative Agent shall have received, on or prior to
September 15, 1994, the following, each dated the date of such
effectiveness, in form and substance satisfactory to the
Administrative Agent and (except for the Notes) in sufficient
copies for each Lender:
(a) The A Notes payable to the order of the Lenders,
respectively.
(b) Certified copies of the resolutions of the Board
of Directors of the Borrower approving, and authorizing the
execution, delivery and performance of, this Agreement, the
Notes and of all documents evidencing other necessary
corporate actions and governmental approvals, if any, with
respect to this Agreement and the Notes.
(c) A certificate of the Secretary or an Assistant
Secretary of the Borrower certifying the Borrower's Articles
of Incorporation, Code of Regulations and By-Laws and
certifying the names and true signatures of the officers of
the Borrower authorized to sign this Agreement and the
Notes.
(d) A favorable opinion of the General Counsel or an
Assistant Counsel of the Borrower substantially in the form
of Exhibit E hereto and as to such other matters as any
Lender through the Administrative Agent may reasonably
request.
(e) A favorable opinion of Milbank, Tweed, Hadley &
McCloy, special counsel for the Administrative Agent,
substantially in the form of Exhibit F hereto.
(f) A certificate of the Vice President -
Administration, or other duly authorized officer, of the
Borrower certifying that (i) no Default or Event of Default
as of the date thereof has occurred and is continuing, and
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(ii) the representations and warranties contained in
Section 4.01 are true and correct on and as of the date
thereof as if made on and as of such date.
(g) Evidence satisfactory to the Administrative Agent
that the principal of and interest on, and all other amounts
owing in respect of, the indebtedness indicated on
Schedule II hereto shall have been (or shall be
simultaneously) paid in full and that any commitments to
extend credit under the agreements or instruments relating
to such indebtedness shall have been canceled or terminated.
Without limiting the foregoing, the making of the initial
A Advance is subject to the additional condition precedent that
since December 31, 1993, there has been no materially adverse
change in the financial condition or results of operations of the
Borrower and its Subsidiaries as shown on the consolidated
balance sheet as of such date and the related consolidated
statement of net income for the period then ended, and the
Borrower has delivered to the Administrative Agent (in sufficient
quantities for each Lender) a certificate of the Vice President -
Administration, or other duly authorized officer, of the Borrower
to such effect.
SECTION 3.02. Conditions Precedent to Each
A Borrowing. The obligation of each Lender to make an A Advance
on the occasion of each A Borrowing (including the initial
A Borrowing) shall be subject to the further conditions precedent
that on the date of such A Borrowing:
(a) the following statements shall be true (and each
of the giving of the applicable Notice of A Borrowing and
the acceptance by the Borrower of the proceeds of such A
Borrowing shall constitute a representation and warranty by
the Borrower that on the date of such A Borrowing such
statements are true):
(i) the representations and warranties contained
in Section 4.01 are true and correct on and as of the
date of such A Borrowing, before and after giving
effect to such A Borrowing and to the application of
the proceeds therefrom, as though made on and as of
such date, and
(ii) no event has occurred and is continuing, or
would result from such A Borrowing or from the
application of the proceeds therefrom, which
constitutes a Default or an Event of Default; and
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(b) the Administrative Agent shall have received such
other approvals, opinions or documents as any Lender (other
than the Designated Bidders) through the Administrative
Agent may reasonably request.
SECTION 3.03. Conditions Precedent to Each
B Borrowing. The obligation of each Lender which is to make a
B Advance on the occasion of a B Borrowing (including the initial
B Borrowing) to make such B Advance as part of such B Borrowing
is subject to the conditions precedent that:
(a) the Administrative Agent shall have received the
written confirmatory Notice of B Borrowing with respect
thereto,
(b) on or before the date of such B Borrowing, but
prior to such B Borrowing, the Administrative Agent shall
have received a B Note payable to the order of such Lender
for each of the one or more B Advances to be made by such
Lender as part of such B Borrowing, in a principal amount
equal to the principal amount of the B Advance to be
evidenced thereby and otherwise on such terms as were agreed
to for such B Advance in accordance with Section 2.03, and
(c) on the date of such B Borrowing the following
statements shall be true (and each of the giving of the
applicable Notice of B Borrowing and the acceptance by the
Borrower of the proceeds of such B Borrowing shall
constitute a representation and warranty by the Borrower
that on the date of such B Borrowing such statements are
true):
(i) The representations and warranties contained
in Section 4.01 are true and correct on and as of the
date of such B Borrowing, before and after giving
effect to such B Borrowing and to the application of
the proceeds therefrom, as though made on and as of
such date,
(ii) No event has occurred and is continuing, or
would result from such B Borrowing or from the
application of the proceeds therefrom, which
constitutes a Default or an Event of Default, and
(iii) No event has occurred and no circumstance
exists as a result of which the information concerning
the Borrower that has been provided to the
Administrative Agent and each Lender by the Borrower in
connection herewith would include an untrue statement
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of a material fact or omit to state any material fact
or any fact necessary to make the statements contained
therein, in the light of the circumstances under which
they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the
Borrower. The Borrower represents and warrants as follows:
(a) Each of the Borrower, Aeroquip Corporation (a
Michigan corporation) and Vickers Incorporated (a Delaware
corporation) is a corporation duly organized and validly
existing under the laws of its state of incorporation, and
is duly qualified and in good standing under the laws of the
respective states in which its significant facilities are
located. Each of them has the corporate power to carry on
its business and own its properties, and has not received
any notice from the authorities of any jurisdiction claiming
that it is required to be qualified as a foreign corporation
in any jurisdiction where it is not presently qualified.
(b) The execution, delivery and performance by the
Borrower of this Agreement and the Notes are within the
Borrower's corporate powers, have been duly authorized by
all necessary corporate action, and do not contravene (i)
the Borrower's Articles of Incorporation, as amended, Code
of Regulations, as amended, or By-Laws or (ii) any law or
any contractual restriction binding on or affecting the
Borrower.
(c) No authorization or approval or other action by,
and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution,
delivery and performance by the Borrower of this Agreement
or the Notes.
(d) This Agreement is, and the Notes when duly
executed and delivered will be, legal, valid and binding
obligations of the Borrower enforceable against the Borrower
in accordance with their respective terms, except as such
terms may be limited by bankruptcy, insolvency, or other
similar laws affecting enforcement of creditors' rights
generally.
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(e) The financial statements in the Annual Report of
the Borrower and its Subsidiaries for the year ending
December 31, 1993, examined by Ernst & Young, independent
auditors, copies of which have been provided to the Banks,
fairly present the financial condition of the Borrower and
its Subsidiaries as of such date and the results of
operations and cash flows of the Borrower and its
Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles
applied on a consistent basis.
(f) There is no pending or (to the knowledge of the
Borrower) threatened action or proceeding affecting the
Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator which, if resolved
adversely to the Borrower or reduced to a judgment, (i) will
materially adversely affect the earnings, financial
condition, or operations of the Borrower and its
Subsidiaries, or (ii) could affect the legality, validity,
binding effect or enforceability of this Agreement or any
Note.
(g) The Borrower is not engaged principally, or as one
of its important activities, in the business of extending
credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System), and no part of the
proceeds of any Advance hereunder will be used to purchase
or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock.
(h) The Borrower and its Subsidiaries have filed (or
have obtained extensions of the time by which they are
required to file) all United States Federal income tax
returns and all other material tax returns required to be
filed by them and have paid all taxes shown due on the
returns so filed as well as all other material taxes,
assessments and governmental charges which have become due,
except such taxes, if any, as are being contested in good
faith and as to which adequate reserves have been provided.
(i) Each Plan, and, to the knowledge of the Borrower,
each Multiemployer Plan, is in compliance in all material
respects with, and has been administered in all material
respects in compliance with, the applicable provisions of
ERISA, the Code and any other Federal or State law. Without
limiting the foregoing, neither the Borrower nor any of its
Subsidiaries has incurred any liability to the PBGC
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established under ERISA in connection with any Plan or
Multiemployer Plan.
(j) No proceeds of any Advance will be used to acquire
any security in any transaction which is subject to Sections
13 or 14 of the Securities Exchange Act of 1934.
(k) The Borrower and each of its Subsidiaries has
obtained all environmental, health and safety permits,
licenses and other authorizations required under all
Environmental Laws to carry on its business as now being or
as proposed to be conducted, except to the extent failure to
have any such permit, license or authorization would not
(either individually or in the aggregate) materially
adversely affect the earnings, financial condition, or
operations of the Borrower and its Subsidiaries. Each of
such permits, licenses and authorizations is in full force
and effect and the Borrower and each of its Subsidiaries is
in compliance with the terms and conditions thereof, and is
also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any
applicable Environmental Law or in any regulation, code,
plan, order, decree, judgment, injunction, notice or demand
letter issued, entered, promulgated or approved thereunder,
except to the extent failure to comply therewith would not
(either individually or in the aggregate) materially
adversely affect the earnings, financial condition, or
operations of the Borrower and its Subsidiaries.
(l) Without limiting the foregoing paragraphs (a)
through (k), the Borrower and each of its Subsidiaries is in
full compliance with all laws, statutes, rules, regulations
and orders binding on or applicable to the Borrower, its
Subsidiaries and all of their respective properties, except
to the extent failure to so comply will not (either
individually or in the aggregate) materially adversely
affect the earnings, financial condition, or operations of
the Borrower and its Subsidiaries.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any
Note shall remain unpaid or any Lender shall have any Commitment
hereunder, the Borrower covenants and agrees that, unless the
Majority Lenders shall otherwise consent in writing:
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(a) Financial Statements. The Borrower will, and will
cause each of its Subsidiaries to, keep true books of record
and account in which full, true and correct entries in
accordance with generally accepted accounting principles
consistently applied will be made of all dealings or
transactions in relation to its business and activities; and
will deliver to each Bank:
(i) as soon as available and in any event within
ninety days after the end of each fiscal year of the
Borrower, a consolidated balance sheet of the Borrower
and its Subsidiaries as of the end of such fiscal year
and the related consolidated statements of net
earnings, stockholders' equity and cash flows for such
fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all
audited and reported on in accordance with generally
accepted accounting principles by Ernst & Young or
other nationally recognized certified independent
public accountants in good standing, together with a
certificate signed by the chief financial officer or
the chief accounting officer of the Borrower stating
that, as of the end of such fiscal year, the Borrower
is in compliance with Section 5.02;
(ii) as soon as available and in any event within
forty-five days after the end of each of the first
three quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such quarter and the
related consolidated statements of net earnings and
stockholders' equity for such quarter and for the
portion of the Borrower's fiscal year ended at the end
of such quarter, setting forth in each case 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,
in accordance with generally accepted accounting
principles by the chief financial officer or the chief
accounting officer of the Borrower, together with a
certificate signed by the chief financial officer or
the chief accounting officer of the Borrower stating
that, as of the end of such fiscal quarter, the
Borrower is in compliance with Section 5.02;
(iii) promptly upon the mailing thereof to the
shareholders of the Borrower generally, copies of all
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financial statements, reports and proxy statements so
mailed;
(iv) promptly upon filing thereof, copies of all
registration statements (other than the exhibits
thereto and any registration statements on Form S-8 or
its equivalent) and annual, quarterly or monthly
reports which the Borrower shall have filed with the
Securities and Exchange Commission;
(v) promptly upon receipt thereof, copies of all
notices which the Borrower or any of its Subsidiaries
receives from the PBGC of its intention to terminate
any Plan or Multiemployer Plan;
(vi) from time to time such additional information
regarding the financial position or business of the
Borrower and its Subsidiaries as any Lender may
reasonably request; and
(vii) promptly upon becoming aware of the existence
of any condition or event which constitutes a Default
or an Event of Default hereunder, a certificate of an
officer of the Borrower to such effect setting forth
the details thereof, and the action theretofore taken
and proposed to be taken with respect thereto.
(b) Information. The Borrower will, and will cause
each of its Subsidiaries to, furnish to the Administrative
Agent and each Lender such other information as any Lender
may (through the Administrative Agent) from time to time
reasonably request, and each Lender shall have the right to
visit and inspect, under the guidance of the Borrower, their
respective properties, to examine their respective general
books of accounts with, and be advised as to the same by,
their respective officers, all at reasonable times and
intervals; provided that the Borrower and its Subsidiaries
shall not be required to furnish to the Administrative Agent
or any Lender, nor permit the Administrative Agent or any
Lender to examine, books and records relating to the
Borrower's or its Subsidiaries' respective trade secrets,
the shareholders' list of the Borrower and other information
that the Borrower reasonably determines to be confidential;
provided further that the Administrative Agent and each
Lender shall make the same efforts to keep confidential any
information obtained from the Borrower which the Borrower
reasonably designates as confidential as the Administrative
Agent or such Lender, as the case may be, makes to keep
confidential such information of its own.
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(c) ERISA. The Borrower and its Subsidiaries:
(i) will make all payments required to meet the
minimum funding standards set forth in Sections 302 through
305 of ERISA, as from time to time amended, with respect to
each Plan and each Multiemployer Plan;
(ii) will file each annual report required to be filed
pursuant to Section 103 of ERISA in connection with each
Plan and each Multiemployer Plan for each year;
(iii) will not incur or suffer to exist any Reportable
Event arising in connection with any such Plan or
Multiemployer Plan which might constitute grounds for the
termination thereof by the PBGC or for the appointment by
the appropriate United States district court of a trustee to
administer such Plan or Multiemployer Plan.
The Borrower will deliver to each Lender (through the Agent)
notice of a Reportable Event promptly when the Borrower
becomes aware of its existence as notified by the PBGC.
(d) Insurance. The Borrower will insure and keep
insured, and cause each of its Subsidiaries to insure and
keep insured, with good and responsible insurance companies,
all of its and their property of an insurable nature
(including, without limitation, all buildings, machinery,
plants, equipment, fixtures and inventories of raw
materials, goods in process and completed goods) against
fire and other casualties in such manner and to the extent
that like properties are usually insured by others operating
plants and properties of a similar character in the same
locality (provided, however, that the Borrower may maintain
self-insurance in connection with the foregoing insurance
requirements in accordance with sound business practice),
and insure and keep insured and cause each of its
Subsidiaries to insure and keep insured at all times either
with good and responsible insurance companies or pursuant to
self-insurance maintained in accordance with sound business
practice against liability on account of damage to Persons
or property and under all applicable workmen's compensation
laws.
(e) Taxes, Charges, Etc. The Borrower will, and will
cause each of its Subsidiaries to, pay and discharge, or
cause to be paid and discharged, all taxes, assessments and
other governmental charges imposed upon it or any of its
Subsidiaries and its and their properties, or any part
thereof or upon the income or profits therefrom, as well as
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all claims for labor, materials or supplies which if unpaid
might by law become a lien or charge upon any property of
the Borrower or any such Subsidiary, except such items as
are being in good faith appropriately contested by the
Borrower or any of its Subsidiaries and as to which
appropriate reserves are being maintained.
(f) Property. The Borrower will maintain, preserve
and keep its own and will cause its Subsidiaries to keep
their principal plants and properties and every part thereof
in good repair, working order and condition and from time to
time make all needful and proper repairs, renewals,
replacements, additions, betterments and improvements
thereto so that at all times the efficiency thereof shall be
fully preserved and maintained.
(g) Corporate Existence, Etc. The Borrower will
maintain its corporate existence and comply, and cause each
Subsidiary to comply, in all material respects with all
applicable laws, statutes, rules, regulations and orders,
such compliance to include, without limitation, compliance
with ERISA and Environmental Laws.
(h) Use of Proceeds. The Borrower will use the
proceeds of the Advances hereunder to finance the operations
of the Borrower and its Subsidiaries, to refinance certain
existing indebtedness of the Borrower, to support the
Borrower's commercial paper program and for other general
corporate purposes (in each case in compliance with all
applicable legal and regulatory requirements); provided that
neither the Administrative Agent nor any Lender shall have
any responsibility as to the use of any such proceeds.
SECTION 5.02. Negative Covenants. So long as any Note
shall remain unpaid or any Lender shall have any Commitment
hereunder, the Borrower covenants and agrees that, without the
written consent of the Majority Lenders:
(a) Financial Covenants.
(i) Interest Coverage. The Borrower will not permit
the ratio of (x) Consolidated Earnings before Interest and
Taxes as at the end of any fiscal quarter of the Borrower to
(y) Consolidated Interest Expense as at the end of such
fiscal quarter, to be less than 1.50 to 1.00 for the period
of four fiscal quarters then ending, taken as a whole.
(ii) Debt-to-Capitalization. The Borrower will not
permit the ratio of (x) the aggregate principal amount of
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Borrowed Money (determined on a consolidated basis) as at
the end of any fiscal quarter of the Borrower to
(y) Consolidated Capitalization as at the end of such fiscal
quarter (each as reported on the latest quarterly
consolidated balance sheet of the Borrower and its
Subsidiaries) to exceed 0.60 to 1.00.
(b) Liens. The Borrower will not at any time create,
assume or suffer to exist any Lien on or in respect of any
capital stock of any of its Subsidiaries. The Borrower will
not at any time create, assume or suffer to exist any Lien
on or in respect of other Principal Assets of the Borrower
or any of its Subsidiaries, whether now owned or hereafter
acquired, other than:
(i) Liens for current taxes, assessments or other
governmental charges which are not delinquent or remain
payable without any penalty, or the validity of which
is contested in good faith by appropriate proceedings
upon stay of execution of the enforcement thereof,
provided in each case that appropriate reserves are
maintained therefor;
(ii) deposits or pledges to secure:
(A) statutory obligations;
(B) surety or appeal bonds;
(C) bonds for release of attachment, stay of
execution or injunction; or
(D) performance of bids, tenders, contracts
(other than for the repayment of Borrowed Money)
or leases, or for purposes of like general nature
in the ordinary course of its business;
(iii) Liens arising from any attachment being
contested in good faith by appropriate proceedings and
any Lien arising from a judgment or award so long as a
subsisting stay of execution or enforcement of any Lien
described in this Section 5.02(b)(iii) has been
obtained, provided that appropriate reserves are
maintained therefor;
(iv) other Liens incidental to the conduct of its
business or the ownership or use of its Principal
Assets (including, without limitation, carriers',
warehousemen's, mechanics', materialmen's, vendors'
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liens, and other similar liens) which do not, in the
reasonable opinion of the Borrower, in the aggregate
materially detract from the value of the property or
assets of the Borrower and its Subsidiaries, taken as a
whole, or materially impair their use in the operation
of the business of the Borrower or such Subsidiary, as
the case may be;
(v) any Lien placed upon any Principal Asset
acquired, constructed or improved by the Borrower or
any of its Subsidiaries, to secure or provide the
payment of all or part of the purchase price of such
Principal Asset or the cost of such construction or
improvement; provided that any such Lien shall not
encumber any other Principal Asset of the Borrower or
any such Subsidiary other than the Principal Asset so
acquired, constructed or improved (and any theretofore
substantially unimproved real property on which such
Principal Assets so acquired or constructed or the
improvement is located);
(vi) Liens on the Principal Assets of the Borrower
or any Subsidiary in favor of the government of the
United States of America or any country in which such
Subsidiary is incorporated or any department or agency
of the United States of America or such country or in
favor of a prime contractor under a government contract
of the government of the United States of America or
such country resulting from acceptance of progress or
partial payments in the ordinary course of business
under government contracts or subcontracts thereunder,
or incurred to secure any debt to the United States of
America or such country or any department or agency
thereof incurred for the purpose of financing all or
any part of the purchase price or cost of constructing
or improving the property subject to such Lien;
(vii) Liens incurred in connection with Tax-Free
Financings;
(viii) Liens of the Borrower and its Subsidiaries
existing on the date hereof and set forth on
Schedule III hereto;
(ix) Liens existing on any Principal Asset of any
corporation at the time it becomes a Subsidiary of the
Borrower, or existing prior to the time of acquisition
upon any Principal Asset acquired by the Borrower or
any of its Subsidiaries through purchase, merger or
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consolidation or otherwise, whether or not assumed by
the Borrower or such Subsidiary;
(x) Liens on any Principal Asset of a Subsidiary
to secure obligations of such Subsidiary to the
Borrower or another Subsidiary of the Borrower,
provided that no such Lien shall at any time be
transferred (whether by sale, merger or other
disposition or otherwise) to or otherwise held by any
Person that is not the Borrower or another Subsidiary
of the Borrower;
(xi) any Lien renewing, extending or refunding any
Lien existing on the date hereof or permitted by
clauses (i) through (x) above, provided that the
principal amount secured is not increased, and the Lien
is not extended to other property; and
(xii) any other Lien created, incurred or assumed
after the date hereof upon any Principal Asset of the
Borrower or any of its Subsidiaries whether now owned
or hereafter acquired, provided that after giving
effect to the Lien, the aggregate amount of all Liens
permitted by clause (vii), clause (viii) or this clause
(xii) (and not permitted by any other clause of this
Section 5.02(b)), and Attributable Debt (except such
Attributable Debt, if any, as arises in connection with
a sale and leaseback that is excluded from
Section 5.02(d) by reason of the Borrower's compliance
with clause (ii) of said paragraph) does not exceed 15%
of Consolidated Net Tangible Assets as reported on the
latest quarterly consolidated balance sheet of the
Borrower and its Subsidiaries.
(c) Merger and Sale of Assets. The Borrower will not
merge or consolidate with any other corporation or sell,
lease or transfer or otherwise dispose of, whether in one
transaction or in a series of transactions, all or
substantially all of its properties or assets, to any
Person, except that:
(i) any Subsidiary of the Borrower may merge or
consolidate with, or sell, lease, transfer or otherwise
dispose of all or substantially all of its properties
or assets to, any other Subsidiary or Subsidiaries of
the Borrower, or merge or consolidate with the
Borrower, provided that in the case of a merger or
consolidation with the Borrower, (A) the Borrower shall
be the continuing or surviving corporation,
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(B) immediately after such merger or consolidation, the
Borrower would not, on a pro forma basis giving effect to
such merger or consolidation, be in violation of
Section 5.02(a)(ii), and (C) immediately after giving effect
to such merger or consolidation no Default or Event of
Default shall have occurred and be continuing; and
(ii) the Borrower may merge or consolidate with
any other corporation, provided that (A) the Borrower
shall be the continuing or surviving corporation,
(B) immediately after such merger or consolidation, the
Borrower would not, on a pro forma basis giving effect
to such merger or consolidation, be in violation of
Section 5.02(a)(ii), (C) immediately after giving
effect to such merger or consolidation no Default or
Event of Default shall have occurred and be continuing,
and (D) after giving effect to such merger or
consolidation, the rating by Moody's or Standard &
Poor's in effect with respect to each debt and equity
security of the Borrower (x) will not be lowered by
more than one rating subcategory from the respective
rating in effect immediately prior to giving effect to
such merger or consolidation and (y) will not be lower
than BBB- (in the case of the Standard & Poor's rating)
or Baa3 (in the case of the Moody's rating);
provided that, after giving effect to any merger,
consolidation or sale of assets permitted hereunder no
Change in Control shall have occurred.
(d) Sale and Lease-Back. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into any
arrangement with any Person, or any arrangement to which any
such Person is a party, that provides for the leasing by the
Borrower or any of its Subsidiaries of any Principal Asset
which has been, or is to be, sold or transferred by the
Borrower or any of its Subsidiaries to such Person (or to
any other Person to whom funds have been or are to be
advanced by such Person on the security of such property or
rental obligations of the Borrower or any of its
Subsidiaries), other than sales or transfers between the
Borrower and any such Subsidiary or a lease for a temporary
period not to exceed 12 months, provided that this
Section 5.02(d) shall not prohibit any such sale and
lease-back of any Principal Asset if:
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(i) the creation or assumption of a Lien on such
Principal Asset would be permitted pursuant to clauses
(i) through (xii) of Section 5.02(b); or
(ii) (A) the proceeds of such sale would be at
least equal to the fair value of such Principal Asset
(as determined in good faith by the Board of Directors
of the Borrower), (B) the Borrower redeems or otherwise
repays Borrowed Money of the Borrower or any of its
Subsidiaries in an aggregate principal amount equal to
the proceeds of such sale within 90 days thereof,
(C) immediately after giving effect to such sale,
lease-back and redemption no Default or Event of
Default shall have occurred and be continuing, and
(D) the Borrower shall have delivered to the
Administrative Agent an officer's certificate to all
such effects.
(e) Lines of Business. Neither the Borrower nor any
of its Subsidiaries will engage to any substantial extent in
any line or lines of business activity other than (i) the
manufacture and distribution of engineered components and
systems for industry, and (ii) other lines of business
activity which account for not more than 10% of the
consolidated revenues of the Borrower and its Subsidiaries
and not more than 10% of the consolidated assets of the
Borrower and its Subsidiaries.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the
following events ("Events of Default") shall occur and be
continuing:
(a) The Borrower shall fail to pay any principal of,
or interest on, any Note when the same becomes due and
payable; or the Borrower shall fail to pay any fee
(including, without limitation, any Facility Fee or
Utilization Fee) or other amount when due and such failure
remains unremedied for three Business Days after its first
occurrence; or
(b) Any representation or warranty made by the
Borrower or any of its Subsidiaries herein or in written
representations or warranties by the Borrower or any of its
Subsidiaries (or any of their respective officers) in
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connection with this Agreement shall prove to have been
incorrect in any material and adverse respect on the date as
of which made or, pursuant to Section 3.02 or 3.03, deemed
made; or
(c) (i) The Borrower shall fail to perform or observe
any term, covenant or agreement contained in
Section 5.01(a)(vii), 5.01(h) or 5.02; or (ii) the Borrower
or any Subsidiary of the Borrower fails to perform or
observe any other term or covenant of this Agreement on its
part to be performed or observed, and such failure remains
unremedied for 15 days after notice thereof shall have been
given to the Borrower by the Administrative Agent or any
Lender; or
(d) The Borrower or any of its Subsidiaries shall
default in the payment of any principal of, or any interest
on, any other obligation for Borrowed Money beyond any
period of grace provided with respect thereto, or shall
default in the performance or observance of any other
agreement, term or condition contained therein or in any
agreement under which such obligation is created (or if any
other event of default thereunder or under such agreement
shall occur and be continuing) if (1) the effect of such
default is to cause, or to permit the holder or holders of
such obligation to cause, such obligation to become due
prior to its stated maturity, unless any such default has
been cured or waived, and (2) either (i) the aggregate
unpaid principal amount of all obligations as to which such
defaults have occurred and are continuing equals or exceeds
$5,000,000, or (ii) regardless of the amount of the
aggregate unpaid principal amount of such obligations, any
such default continues for more than 30 days; or
(e) The Borrower or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or
shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted
by or against the Borrower or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its
debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for
any substantial part of its property and, in the case of any
such proceeding instituted against the Borrower or any of
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its Subsidiaries, such proceeding shall remain undismissed
or unstayed for a period of 60 days; or the Borrower or any
of its Subsidiaries shall take any corporate action to
authorize any of the actions set forth above in this
subsection (e); or
(f) Any judgment or order for the payment of money
shall be rendered against the Borrower or any of its
Subsidiaries:
(i) in an amount in excess of $100,000,000.00,
regardless of whether the Borrower or such Subsidiary
shall have paid the amount thereof, whether enforcement
proceedings have been commenced by any creditor upon
such judgment or order and whether there shall be in
effect (by reason of a pending appeal or otherwise) any
stay of enforcement of such judgment or order; or
(ii) in an amount in excess of $5,000,000.00, if
(x) such judgment or order shall not be paid promptly
by the Borrower or such Subsidiary, (y) enforcement
proceedings shall have been commenced by any creditor
upon such judgment or order and (z) there shall be any
period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or
(g) A Change in Control shall occur; or
(h) The Borrower shall incur or in the opinion of the
Majority Lenders shall be reasonably likely to incur a
liability to a Plan, a Multiemployer Plan or PBGC (or any
combination of the foregoing) that, in the determination of
the Majority Lenders, would (either individually or in the
aggregate) materially adversely affect the earnings,
financial condition, or operations of the Borrower and its
Subsidiaries;
then, and in any such event, the Administrative Agent (i) shall
at the request, or may with the consent, of the Majority Lenders,
by notice to the Borrower, declare the obligation of each Lender
to make Advances to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with
the consent, of the Majority Lenders, by notice to the Borrower,
declare the Notes, all interest thereon and all other amounts
payable under this Agreement to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall
become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are
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hereby expressly waived by the Borrower; provided, however, that
in the event of an actual or deemed entry of an order for relief
with respect to the Borrower under the Federal Bankruptcy Code,
(A) the obligation of each Lender to make Advances shall
automatically be terminated and (B) the Notes, all such interest
and all such amounts shall automatically become and be due and
payable, without presentment, demand, protest or any notice of
any kind, all of which are hereby expressly waived by the
Borrower.
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action. Each Lender
hereby appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers
under this Agreement as are delegated to the Administrative Agent
by the terms hereof, together with such powers as are reasonably
incidental thereto. As to any matters not expressly provided for
by this Agreement (including, without limitation, enforcement or
collection of the Notes), the Administrative Agent shall not be
required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the
instructions of the Majority Lenders, and such instructions shall
be binding upon all Lenders and all holders of Notes; provided,
however, that the Administrative Agent shall not be required to
take any action which exposes the Administrative Agent to
personal liability or which is contrary to this Agreement or
applicable law. The Administrative Agent agrees to give to each
Lender prompt notice of each notice given to it by the Borrower
pursuant to the terms of this Agreement.
SECTION 7.02. Administrative Agent's Reliance, Etc.
Neither the Administrative Agent nor any of its directors,
officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection
with this Agreement, except for its or their own gross negligence
or willful misconduct. Without limitation of the generality of
the foregoing, the Administrative Agent: (i) may treat the payee
of any Note as the holder thereof until the Administrative Agent
receives and accepts an Assignment and Acceptance entered into by
the Lender which is the payee of such Note, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07;
(ii) may consult with legal counsel (including counsel for the
Borrower), independent public accountants and other experts
selected by it and shall not be liable for any action taken or
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omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (iii) makes no
warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in
connection with this Agreement; (iv) shall not have any duty to
ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement on
the part of the Borrower or to inspect the property (including
the books and records) of the Borrower; (v) shall not be
responsible to any Lender for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of
this Agreement or any other instrument or document furnished
pursuant hereto; and (vi) shall incur no liability under or in
respect of this Agreement by acting upon any notice, consent,
certificate or other instrument or writing (which may be by
telecopier, telegram, cable or telex) reasonably believed by it
to be genuine and signed or sent by the proper party or parties.
SECTION 7.03. Citibank and Affiliates. With respect
to its Commitment, the Advances made by it and the Notes issued
to it, Citibank shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though
it were not the Administrative Agent; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated, include
Citibank in its individual capacity. Citibank and its Affiliates
may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with,
the Borrower, any of its Subsidiaries and any Person who may do
business with or own securities of the Borrower or any such
Subsidiary, all as if Citibank were not the Administrative Agent
and without any duty to account therefor to the Lenders.
SECTION 7.04. Lender Credit Decision. Each Lender
acknowledges that it has, independently and without reliance upon
the Administrative Agent or any other Lender and based on the
financial statements referred to in Section 4.01 and such other
documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement.
Each Lender also acknowledges that it will, independently and
without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement.
SECTION 7.05. Indemnification. The Lenders agree to
indemnify the Administrative Agent (to the extent not reimbursed
by the Borrower), ratably according to the respective principal
amounts of the Notes then held by them (or if no Notes are at
the
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time outstanding or if any Notes are held by Persons which are
not Lenders, ratably according to the respective amounts of their
Commitments), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted
against the Administrative Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by
the Administrative Agent under this Agreement, provided that no
Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct.
Without limiting the foregoing, each Lender agrees to reimburse
the Administrative Agent promptly upon demand for its ratable
share of any out-of-pocket expenses (including counsel fees)
incurred by the Administrative Agent in connection with the
preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, to the extent
that the Administrative Agent is not reimbursed for such expenses
by the Borrower.
SECTION 7.06. Successor Administrative Agent. The
Administrative Agent may resign at any time by giving written
notice thereof to the Lenders and the Borrower and may be removed
at any time with or without cause by the Majority Lenders. Upon
any such resignation or removal, the Majority Lenders shall have
the right to appoint a successor Administrative Agent that,
unless a Default or Event of Default shall have occurred and then
be continuing, is reasonably acceptable to the Borrower. If no
successor Administrative Agent shall have been so appointed by
the Majority Lenders, and shall have accepted such appointment,
within 30 days after the retiring Administrative Agent's giving
of notice of resignation or the Majority Lenders' removal of the
retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State
thereof and having a combined capital and surplus of at least
$50,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its
duties and obligations under this Agreement. After any retiring
Administrative Agent's resignation or removal hereunder as
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Administrative Agent, the provisions of this Article VII shall
inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this
Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver
of any provision of this Agreement or the A Notes, nor consent to
any departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the
Majority Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the
Lenders (other than the Designated Bidders), do any of the
following: (a) waive any of the conditions specified in
Section 3.01 or 3.02, (b) increase the Commitments of such
Lenders or subject such Lenders to any additional obligations,
(c) reduce the principal of, or interest on, the A Notes or any
fees or other amounts payable hereunder, (d) postpone any date
fixed for any payment of principal of, or interest on, the
A Notes or any fees or other amounts payable hereunder,
(e) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the A Notes, or the number of Lenders,
which shall be required for the Lenders or any of them to take
any action hereunder or (f) amend this Section 8.01; provided
further that (X) no amendment, waiver or consent shall, unless in
writing and signed by each Lender holding a B Note at such time,
(1) reduce the principal of, or interest on, such B Notes or any
fees or other amounts payable hereunder or thereunder with
respect thereto, (2) postpone any date fixed for any payment of
principal of, or interest on, the such B Notes or any fees or
other amounts payable hereunder or thereunder with respect
thereto, or (3) subject such Lender to any additional
obligations, and (Y) no amendment, waiver or consent shall,
unless in writing and signed by all the Lenders, waive any of the
conditions specified in Section 3.03; and provided still further
that no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders
required above to take such action, affect the rights or duties
of the Administrative Agent under this Agreement or any Note.
SECTION 8.02. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing
(including telecopier, telegraphic, telex or cable
communication)
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and mailed, telecopied, telegraphed, telexed, cabled or
delivered, if to the Borrower, at its address at TRINOVA
Corporation, 3000 Strayer, P.O. Box 50, Maumee, Ohio, 43537-
00500; Attention: James M. Oathout; if to any Bank, at its
Domestic Lending Office specified opposite its name on Schedule I
hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assignment and Acceptance or Designation
Agreement pursuant to which it became a Lender; and if to the
Administrative Agent, Attention: Philip Green, 1 Court Square,
7th Floor, Long Island City, New York 11120, telephone no.
(718) 248-4529, telecopier no. (718) 248-4844; or, as to the
Borrower or the Administrative Agent, at such other address as
shall be designated by such party in a written notice to the
other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to the
Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed,
telexed or cabled, be effective when deposited in the mails,
telecopied, delivered to the telegraph company, confirmed by
telex answerback or delivered to the cable company, respectively,
except that notices and communications to the Administrative
Agent pursuant to Article II or VII shall not be effective until
received by the Administrative Agent.
SECTION 8.03. No Waiver; Remedies. No failure on the
part of any Lender or the Administrative Agent to exercise, and
no delay in exercising, any right hereunder or under any Note
shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 8.04. Costs, Expenses and Indemnification.
(a) The Borrower agrees to pay on demand all costs and
expenses in connection with the preparation, execution, delivery,
administration, modification and amendment of this Agreement, the
Notes and the other documents to be delivered hereunder,
including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Administrative Agent
with respect thereto and with respect to advising the
Administrative Agent as to its rights and responsibilities under
this Agreement. The Borrower further agrees to pay on demand all
costs and expenses, if any (including, without limitation,
reasonable counsel fees and expenses of the Administrative Agent
and each of the Lenders), in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of
this Agreement, the Notes and the other documents to be
delivered
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hereunder, including, without limitation, reasonable counsel fees
and expenses in connection with the enforcement of rights under
this Section 8.04(a).
(b) The Borrower hereby agrees to indemnify the
Administrative Agent, Citicorp Securities, Inc., each Lender and
each of their Affiliates and their respective directors,
officers, employees, agents, advisors and representatives (each,
an "Indemnified Party") from against any and all claims, damages,
losses, liabilities and expenses (including, without limitation,
fees and disbursements of counsel), joint or several, that may be
incurred by or asserted or awarded against any Indemnified Party,
in each case arising out of or in connection with or relating to
any investigation, litigation or proceeding or the preparation of
any defense with respect thereto arising out of or in connection
with or relating to this Agreement, the Notes or the transactions
contemplated hereby or thereby or any use made or proposed to be
made with the proceeds of the Advances, whether or not such
investigation, litigation or proceeding is brought by the
Borrower, any of its shareholders or creditors, an Indemnified
Party or any other Person, or an Indemnified Party is otherwise a
party thereto, and whether or not any of the conditions precedent
set forth in Article III are satisfied or the other transactions
contemplated by this Agreement are consummated, except to the
extent such claim, damage, loss, liability or expense is found in
a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct.
The Borrower hereby further agrees that no Indemnified
Party shall have any liability (whether direct or indirect, in
contract, tort or otherwise) to the Borrower or any of its
shareholders or creditors for or in connection with or relating
to this Agreement, the Notes or the transactions contemplated
hereby or thereby or any use made or proposed to be made with the
proceeds of the Advances, except to the extent such liability is
found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's
gross negligence or willful misconduct.
(c) If any payment of principal of, or Conversion of,
any Eurodollar Rate Advance is made other than on the last day of
the Interest Period for such Advance, as a result of a payment or
Conversion pursuant to Section 2.13 or acceleration of the
maturity of the Notes pursuant to Section 6.01 or for any other
reason, the Borrower shall, upon demand by any Lender (with a
copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender any amounts
required to compensate such Lender for any additional losses,
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costs or expenses which it may reasonably incur as a result of
such payment or Conversion, including, without limitation, any
loss (including loss of anticipated profits not to exceed 15
basis points on the principal amount prepaid or Converted), cost
or expense incurred by reason of the liquidation or reemployment
of deposits or other funds acquired by any Lender to fund or
maintain such Advance.
(d) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in Section 2.15 and this
Section 8.04 shall survive the payment in full of principal and
interest hereunder and under the Notes.
SECTION 8.05. Right of Set-off. Upon (i) the
occurrence and during the continuance of any Event of Default and
(ii) the making of the request or the granting of the consent
specified by Section 6.01 to authorize the Administrative Agent
to declare the Notes due and payable pursuant to the provisions
of Section 6.01, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing
by such Lender or such Affiliate to or for the credit or the
account of the Borrower against any and all of the obligations of
the Borrower now or hereafter existing under this Agreement and
any Note held by such Lender, whether or not such Lender shall
have made any demand under this Agreement or such Note and
although such obligations may be unmatured. Each Lender agrees
promptly to notify the Borrower after any such set-off and
application made by such Lender or such Affiliate, provided that
the failure to give such notice shall not affect the validity of
such set-off and application. The rights of each Lender and its
Affiliate under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off)
which such Lender or such Affiliate may have.
SECTION 8.06. Binding Effect. This Agreement shall
become effective when it shall have been executed by the Borrower
and the Administrative Agent and when the Administrative Agent
shall have been notified by each Bank that such Bank has executed
it and thereafter shall be binding upon and inure to the benefit
of the Borrower, the Administrative Agent and each Lender and
their respective successors and assigns, except that the Borrower
shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lenders.
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SECTION 8.07. Assignments, Designations and
Participations.
(a) Each Lender (other than a Designated Bidder) may
assign to one or more banks or other entities all or a portion of
its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitment, the
A Advances owing to it and the A Note or Notes held by it);
provided, however, that (i) each such assignment shall be of a
constant, and not a varying, percentage of all rights and
obligations under this Agreement (other than any right to make
B Advances, B Advances owing to it or B Notes), (ii) the amount
of the Commitment of the assigning Lender being assigned pursuant
to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall
in no event be less than $5,000,000 and shall be an integral
multiple of $1,000,000, (iii) each such assignment shall be to an
Eligible Assignee, and (iv) the parties to each such assignment
shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and
Acceptance, together with any A Note or Notes subject to such
assignment and a processing and recordation fee of $3,000. Upon
such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released
from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto).
(b) By executing and delivering an Assignment and
Acceptance, the Lender assignor thereunder and the assignee
thereunder confirm to and agree with each other and the other
parties hereto as follows: (i) other than as provided in such
Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in
or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of
this Agreement or any other instrument or document furnished
pursuant hereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with
respect to the financial condition of the Borrower or the
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performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with
copies of the financial statements referred to in Section 4.01
and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent,
such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not
taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and
authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers under this Agreement as
are delegated to the Administrative Agent by the terms hereof,
together with such powers as are reasonably incidental thereto;
and (vii) such assignee agrees that it will perform in accordance
with their terms all of the obligations which by the terms of
this Agreement are required to be performed by it as a Lender.
(c) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee representing that
it is an Eligible Assignee, together with any A Note or Notes
subject to such assignment, the Administrative Agent shall, if
such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit C hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to
the Borrower. Within five Business Days after its receipt of
such notice, the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent in exchange for the
surrendered A Note or Notes a new A Note to the order of such
Eligible Assignee in an amount equal to the Commitment assumed by
it pursuant to such Assignment and Acceptance and, if the
assigning Lender has retained a Commitment hereunder, a new A
Note to the order of the assigning Lender in an amount equal to
the Commitment retained by it hereunder. Such new A Note or
Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered A Note or Notes,
shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of
Exhibit A-1 hereto.
(d) Each Lender may assign to one or more banks or
other entities any B Note or Notes held by it. In addition,
each Lender (other than the Designated Bidders) may designate one
or more banks or other entities to have a right to make
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B Advances as a Lender pursuant to Section 2.03; provided,
however, that (i) no such Lender shall be entitled to make more
than 2 such designations, (ii) each such Lender making one or
more of such designations shall retain the right to make B
Advances as a Lender pursuant to Section 2.03, (iii) each such
designation shall be to a Designated Bidder and (iv) the parties
to each such designation shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the
Register, a Designation Agreement. Upon such execution,
delivery, acceptance and recording, from and after the effective
date specified in each Designation Agreement, the designee
thereunder shall be a party hereto with a right to make B
Advances as a Lender pursuant to Section 2.03 and the obligations
related thereto.
(e) By executing and delivering a Designation
Agreement, the Lender making the designation thereunder and its
designee thereunder confirm and agree with each other and the
other parties hereto as follows: (i) such Lender makes no
representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in
or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of
this Agreement or any other instrument or document furnished
pursuant hereto; (ii) such Lender makes no representation or
warranty and assumes no responsibility with respect to the
financial condition of the Borrower or the performance or
observance by the Borrower of any of its obligations under this
Agreement or any other instrument or document furnished pursuant
hereto; (iii) such designee confirms that it has received a copy
of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents
and information as it has deemed appropriate to make its own
credit analysis and decision to enter into the Designation
Agreement; (iv) such designee will, independently and without
reliance upon the Administrative Agent, such designating Lender
or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this
Agreement; (v) such designee confirms that it is a Designated
Bidder; (vi) such designee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated
to the Administrative Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such
designee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement
are required to be performed by it as a Lender.
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(f) Upon its receipt of a Designation Agreement
executed by a designating Lender and a designee representing that
it is a Designated Bidder, the Administrative Agent shall, if
such Designation Agreement has been completed and is
substantially in the form of Exhibit D hereto, (i) accept such
Designation Agreement, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to
the Borrower.
(g) The Administrative Agent shall maintain at its
address referred to in Section 8.02 a copy of each Assignment and
Acceptance and each Designation Agreement delivered to and
accepted by it and a register for the recordation of the names
and addresses of each of the Lenders and, with respect to Lenders
other than Designated Bidders, the Commitment of, and principal
amount of the A Advances owing to, each such Lender from time to
time (the "Register"). The entries in the Register shall be
conclusive and binding for the purposes, absent manifest error,
and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a
Lender hereunder for the purposes of this Agreement. The
Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon
reasonable prior notice.
(h) Each Lender may sell participations to one or more
banks or other entities in or to all or a portion of its rights
and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment, the Advances
owing to it and the Note or Notes held by it); provided, however,
that (i) such Lender's obligations under this Agreement
(including, without limitation, its Commitment to the Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender shall remain
the holder of any such Note for all purposes of this Agreement,
(iv) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement, and (v) no participant under any such participation
agreement shall any right to approve any amendment or waiver of
any provision of this Agreement or any Note, or to consent to any
departure by the Borrower therefrom, except to the extent that
any such amendment, waiver or consent would (x) reduce the
principal of, or interest on, the Notes or any fee or other
amounts payable hereunder, in each case to the extent the same
are subject to such participation, or (y) postpone any date fixed
for the payment of principal of, or interest on, the Notes or
any
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fees or other amounts payable hereunder, in each case to the
extent the same are subject to such participation.
(i) Any Lender may, in connection with any assignment,
designation or participation or proposed assignment, designation
or participation pursuant to this Section 8.07, disclose to the
assignee, designee or participant or proposed assignee, designee
or participant, any information relating to the Borrower or any
of its Subsidiaries furnished to such Lender by or on behalf of
the Borrower; provided that, prior to any such disclosure, the
assignee, designee or participant or proposed assignee, designee
or participant shall agree to preserve the confidentiality of any
confidential information relating to the Borrower or any such
Subsidiary received by it from such Lender.
(j) Notwithstanding any other provision set forth in
this Agreement, any Lender may at any time create a security
interest in all or any portion of its rights under this Agreement
(including, without limitation, the Advances owing to it and the
Notes held by it) in favor of any Federal Reserve Bank in
accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
SECTION 8.08. Governing Law; Submission to
Jurisdiction. This Agreement and the Notes shall be governed by,
and construed in accordance with, the law of the State of New
York. The Borrower and each of its Subsidiaries 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 the purposes of all
legal proceedings arising out of or relating to this Agreement or
the transactions contemplated hereby. The Borrower and each of
its Subsidiaries, to the fullest extent permitted by applicable
law, irrevocably waives any objection that 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 8.09. Severability. In case any provision in
this Agreement or in any Note shall be held to be invalid,
illegal or unenforceable, such provision shall be severable from
the rest of this Agreement or such Note, as the case may be, and
the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 8.10. Execution in Counterparts. This
Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which
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when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
SECTION 8.11. Survival. The obligations of the
Borrower under Sections 2.08, 2.12, 2.15 and 8.04, and the
obligations of the Lenders under Section 7.05, shall survive the
repayment of the Advances and the termination of the Commitments.
In addition, each representation and warranty made, or deemed to
be made by any Notice of A Borrowing or Notice of B Borrowing,
herein or pursuant hereto shall survive the making of such
representation and warranty, and no Lender shall be deemed to
have waived, by reason of making any Advance, any Default or
Event of Default that may arise by reason of such representation
or warranty proving to have been false or misleading,
notwithstanding that such Lender or the Administrative Agent may
have had notice or knowledge or reason to believe that such
representation or warranty was false or misleading at the time
such extension of credit was made.
SECTION 8.12. Termination of Existing Credit
Facilities. The Borrower and each of the Banks hereby agrees
that, on and as of the date hereof:
(a) the "Commitment" under and as defined in each of
the revolving credit agreements listed in Schedule II hereto
among the Borrower and a Bank is canceled; and
(b) each such revolving credit agreement shall be
terminated and of no further force and effect (except with
respect to obligations of the Borrower thereunder that are
expressly stated to survive such cancellation and
termination).
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto
duly authorized, as of the date first above written.
TRINOVA CORPORATION
By__________________________
Title:
CITIBANK, N.A., as Administrative
Agent
By__________________________
Vice President
Commitment Banks
$ 30,000,000.00 CITIBANK, N.A.
By__________________________
Vice President
$ 25,000,000.00 CHEMICAL BANK
By__________________________
Title:
$ 25,000,000.00 THE FIRST NATIONAL BANK OF CHICAGO
By__________________________
Title:
$ 25,000,000.00 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By__________________________
Title:
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$ 25,000,000.00 NBD BANK, N.A.
By__________________________
Title:
$ 25,000,000.00 UNION BANK OF SWITZERLAND,
CHICAGO BRANCH
By__________________________
Title:
$ 10,000,000.00 THE BANK OF TOKYO TRUST COMPANY
By__________________________
Title:
$ 10,000,000.00 DRESDNER BANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES
By__________________________
Title:
$175,000,000.00 Total of the Commitments
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SCHEDULE I
TRINOVA Corporation
Credit Agreement
dated as of August 31, 1994
DOMESTIC EURODOLLAR
NAME OF BANK LENDING OFFICE LENDING OFFICE
==============================================================================
THE BANK OF TOKYO 1251 Avenue of the 1251 Avenue of the
TRUST COMPANY Americas Americas
New York, NY 10116 New York, NY 10116
Attention: Friedrich Wilms
Tel: 212-782-4341
Fax: 212-782-6440
CITIBANK, N.A. 399 Park Avenue 399 Park Avenue
New York, NY 10043 New York, NY 10043
Attention: Michele Maggio
Tel: 212-559-8856
Fax: 212-826-2375
CHEMICAL BANK 270 Park Avenue 270 Park Avenue
New York, NY 10017 New York, NY 10017
Attention: Karen M. Sager
Tel: 212-270-3997
Fax: 212-972-9854
DRESDNER BANK AG, 75 Wall Street 75 Wall Street
NEW YORK AND New York, NY 10005 New York, NY 10005
GRAND CAYMAN Attention: D. Slusarczyk
BRANCHES
Tel: 212-574-0244
Fax: 212-574-0130
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THE FIRST NATIONAL One First National Plaza One First National Plaza
BANK OF CHICAGO Chicago, IL 60670 Chicago, IL 60670
Attention: Ernest Misiora
Tel: 312-732-7659
Fax: 312-732-4840
with a copy to:
1301 E. 9th Street
Suite 2150
Cleveland, OH 44114
Attention: Robert Jackson
Tel: 216-574-9843
Fax: 216-574-9278
MORGAN GUARANTY TRUST 60 Wall Street 60 Wall Street
COMPANY OF NEW YORK New York, NY 10260 New York, NY 10260
Attention: T. Broadbent
Tel: 212-648-6839
Fax: 212-648-5336
with a copy to:
c/o J.P. Morgan Services, Inc.
500 Stanton Christiana Road
P.O. Box 6070
Newark, DE 19713
Fax: 302-634-1094
NBD BANK, N.A. 611 Woodward Avenue 611 Woodward Avenue
Detroit, MI 48226 Detroit, MI 48226
Attention: D. Pienta
Tel: 313-225-1525
Fax: 313-225-1671
UNION BANK OF 30 S. Wacker Drive, 30 S. Wacker Drive,
SWITZERLAND, 40th Floor 40th Floor
CHICAGO BRANCH Chicago, IL 60606 Chicago, IL 60606
Attention: Steven Dadmun
Tel: 312-993-5471
Fax: 312-993-5530
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SCHEDULE II
TRINOVA Corporation
Credit Agreement
dated as of August 31, 1994
Existing Credit Facilities
1. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and The Bank of
Tokyo Trust Company.
2. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and Citibank, N.A.
3. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and Chemical Bank.
4. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and Dresdner Bank
AG.
5. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and The First
National Bank of Chicago.
6. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and Morgan Guaranty
Trust Company of New York.
7. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and NBD Bank, N.A.
8. Revolving Credit Agreement dated as of September 30, 1992,
as amended, between TRINOVA Corporation and Union Bank of
Switzerland.
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EXHIBIT A-1
FORM OF A NOTE
U.S.$______________ Dated: _________ __, 199__
FOR VALUE RECEIVED, the undersigned, TRINOVA
CORPORATION, an Ohio corporation (the "Borrower"), HEREBY
PROMISES TO PAY to the order of _________________ (the "Lender")
for the account of its Applicable Lending Office (as defined in
the Credit Agreement referred to below) on the Termination Date
(as so defined) the principal sum of U.S.$[amount of the Lender's
Commitment in figures] or, if less, the aggregate principal
amount of the A Advances (as defined below) made by the Lender to
the Borrower pursuant to the Credit Agreement then outstanding.
The Borrower promises to pay interest on the unpaid
principal amount of each A Advance from the date of such
A Advance until such principal amount is paid in full, at such
interest rates, and payable at such times, as are specified in
the Credit Agreement.
Both principal and interest are payable in lawful money
of the United States of America to Citibank, N.A., as
Administrative Agent, at 1 Court Square, 7th Floor, Long Island
City, New York 11120, in same day funds. Each A Advance made by
the Lender to the Borrower pursuant to the Credit Agreement, and
all payments made on account of principal thereof, shall be
recorded by the Lender and, prior to any transfer hereof,
endorsed on the grid attached hereto which is part of this
Promissory Note; provided that the failure of the Lender to make
any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit
Agreement.
This Promissory Note is one of the A Notes referred to
in, and is entitled to the benefits of, the Credit Agreement
dated as of August 31, 1994 (the "Credit Agreement") among the
Borrower, the Lender and certain other banks parties thereto, and
Citibank, N.A., as Administrative Agent for the Lender and such
other banks. The Credit Agreement, among other things,
(i) provides for the making of advances (the "A Advances") by the
Lender to the Borrower from time to time in an aggregate amount
not to exceed at any time outstanding the U.S. dollar amount
first above mentioned, the indebtedness of the Borrower resulting
from each such A Advance being evidenced by this Promissory Note,
and (ii) contains provisions for acceleration of the maturity
hereof upon the happening of certain stated events and also for
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prepayments on account of principal hereof prior to the maturity
hereof upon the terms and conditions therein specified.
The Borrower hereby waives presentment, demand, protest
and notice of any kind. No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder hereof
shall operate as a waiver of such rights.
This Promissory Note shall be governed by, and
construed in accordance with, the law of the State of New York,
United States.
TRINOVA CORPORATION
By__________________________
Title:
-92-
<PAGE>
ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of Unpaid of
Amount of Principal Paid Principal Notation
Date Advance or Prepaid Balance Made By
_________________________________________________________________
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<PAGE>
EXHIBIT A-2
FORM OF B NOTE
U.S.$______________ Dated: _________ __, 199__
FOR VALUE RECEIVED, the undersigned, TRINOVA
CORPORATION, an Ohio corporation (the "Borrower"), HEREBY
PROMISES TO PAY to the order of _________________ (the "Lender")
for the account of its Applicable Lending Office (as defined in
the Credit Agreement referred to below), on ______________,
199__, the principal amount of __________ Dollars ($___________).
The Borrower promises to pay interest on the unpaid
principal amount hereof from the date hereof until such principal
amount is paid in full, at the interest rate and payable on the
interest payment date or dates provided below:
Interest Rate: _____% per annum (calculated on the basis of
a year of _____ days for the actual number of days elapsed).
Interest Payment Date or Dates: ___________________________
Both principal and interest are payable in lawful money
of the United States of America to ______________ or the account
of the Lender at the office of ________________________________,
at _____________________, in same day funds, free and clear of
and without any deduction, with respect to the payee named above,
for any and all present and future taxes, deductions, charges or
withholdings, and all liabilities with respect thereto.
This Promissory Note is one of the B Notes referred to
in, and is entitled to the benefits of, the Credit Agreement
dated as of August 31, 1994 (the "Credit Agreement") among the
Borrower, the Lender and certain other banks parties thereto, and
Citibank, N.A., as Administrative Agent for the Lender and such
other banks. The Credit Agreement, among other things, contains
provisions for acceleration of the maturity hereof upon the
happening of certain stated events.
The Borrower hereby waives presentment, demand, protest
and notice of any kind. No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder hereof
shall operate as a waiver of such rights.
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This Promissory Note shall be governed by, and
construed in accordance with, the law of the State of New York,
United States.
TRINOVA CORPORATION
By_________________________
Title:
-95-
<PAGE>
EXHIBIT B-1
NOTICE OF A BORROWING
Citibank, N.A., as Administrative
Agent for the Lenders parties
to the Credit Agreement
referred to below
1 Court Square, 7th Floor
Long Island City, New York 11120
Attention: Philip Green
[Date]
Ladies and Gentlemen:
The undersigned, TRINOVA Corporation, refers to the
Credit Agreement, dated as of August 31, 1994 (the "Credit
Agreement", the terms defined therein being used herein as
therein defined), among the undersigned, certain Lenders parties
thereto and Citibank, N.A., as Administrative Agent for said
Lenders, and hereby gives you notice, irrevocably, pursuant to
Section 2.02 of the Credit Agreement that the undersigned hereby
requests an A Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such A
Borrowing (the "Proposed A Borrowing") as required by Section
2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed A Borrowing is
___________ __, 199__.
(ii) The Type of A Advances comprising the Proposed A
Borrowing is [Base Rate Advances] [Eurodollar Rate
Advances].
(iii) The aggregate amount of the Proposed A Borrowing
is $___________.
[(iv) The initial Interest Period for each A Advance
made as part of the Proposed A Borrowing is ______
month[s]]1.
The undersigned hereby certifies that the following
statements are true on the date hereof, and will be true on the
date of the Proposed A Borrowing:
_________________
1 For Eurodollar Rate Advances only.
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(A) the representations and warranties contained in
Section 4.01 are correct, before and after giving effect to
the Proposed A Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date;
and
(B) no event has occurred and is continuing, or would
result from such Proposed A Borrowing or from the
application of the proceeds therefrom, which constitutes a
Default or an Event of Default.
Very truly yours,
TRINOVA CORPORATION
By___________________________
Title:
-97-
<PAGE>
EXHIBIT B-2
NOTICE OF B BORROWING
Citibank, N.A., as Administrative
Agent for the Lenders parties
to the Credit Agreement
referred to below
1 Court Square, 7th Floor
Long Island City, New York 11120
Attention: Philip Green
[Date]
Ladies and Gentlemen:
The undersigned, TRINOVA Corporation, refers to the
Credit Agreement, dated as of August 31, 1994 (the "Credit
Agreement", the terms defined therein being used herein as
therein defined), among the undersigned, certain Lenders parties
thereto and Citibank, N.A., as Administrative Agent for said
Lenders, and hereby gives you notice pursuant to Section 2.03 of
the Credit Agreement that the undersigned hereby requests a B
Borrowing under the Credit Agreement, and in that connection sets
forth the terms on which such B Borrowing (the "Proposed B
Borrowing") is requested to be made:
(A) Date of B Borrowing _______________________
(B) Amount of B Borrowing _______________________
(C) Maturity Date _______________________
(D) Interest Rate Basis _______________________
(E) Interest Payment Date(s) _______________________
(F) _______________________ _______________________
(G) _______________________ _______________________
(H) _______________________ _______________________
The undersigned hereby certifies that the following
statements are true on the date hereof, and will be true on the
date of the Proposed B Borrowing:
(a) the representations and warranties contained in
Section 4.01 are correct, before and after giving effect to
the Proposed B Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date;
(b) no event has occurred and is continuing, or would
result from the Proposed B Borrowing or from the application
of the proceeds therefrom, which constitutes a Default or an
Event of Default;
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(c) no event has occurred and no circumstance exists
as a result of which the information concerning the
undersigned that has been provided to the Administrative
Agent and each Lender by the undersigned in connection with
the Credit Agreement would include an untrue statement of a
material fact or omit to state any material fact or any fact
necessary to make the statements contained therein, in the
light of the circumstances under which they were made, not
misleading; and
(d) the aggregate amount of the Proposed B Borrowing
and all other Borrowings to be made on the same day under
the Credit Agreement is within the aggregate amount of the
unused Commitments of the Lenders.
The undersigned hereby confirms that the Proposed B
Borrowing is to be made available to it in accordance with
Section 2.03(a)(v) of the Credit Agreement.
Very truly yours,
TRINOVA CORPORATION
By________________________
Title:
-99-
<PAGE>
EXHIBIT C
ASSIGNMENT AND ACCEPTANCE
Dated ____________ __, 199__
Reference is made to the Credit Agreement dated as of
August 31, 1994 (the "Credit Agreement") among TRINOVA
Corporation, an Ohio corporation (the "Borrower"), the Lenders
(as defined in the Credit Agreement) and Citibank, N.A., as
Administrative Agent for the Lenders (the "Administrative
Agent"). Terms defined in the Credit Agreement are used herein
with the same meaning.
_____________ (the "Assignor") and _____________ (the
"Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the
Assignor, that interest in and to all of the Assignor's rights
and obligations under the Credit Agreement as of the date hereof
(other than in respect of B Advances and B Notes) which
represents the percentage interest specified on Schedule 1 of all
outstanding rights and obligations under the Credit Agreement
(other than in respect of B Advances and B Notes), including,
without limitation, such interest in the Assignor's Commitment,
the A Advances owing to the Assignor, and the A Note[s] held by
the Assignor. After giving effect to such sale and assignment,
the Assignee's Commitment and the amount of the A Advances owing
to the Assignee will be as set forth in Section 2 of Schedule 1.
2. The Assignor (i) represents and warrants that it is
the legal and beneficial owner of the interest being assigned by
it hereunder and that such interest is free and clear of any
adverse claim; (ii) makes no representation or warranty and
assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant
thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any
of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto; and (iv)
attaches the A Note[s] referred to in paragraph 1 above and
requests that the Administrative Agent exchange such A Note[s]
for a new A Note payable to the order of the Assignee in an
amount equal to the Commitment assumed by the Assignee pursuant
hereto or new A Notes payable to the order of the Assignee in an
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amount equal to the Commitment assumed by the Assignee pursuant
hereto and the Assignor in an amount equal to the Commitment
retained by the Assignor under the Credit Agreement,
respectively, as specified on Schedule 1 hereto.
3. The Assignee (i) confirms that it has received a
copy of the Credit Agreement, together with copies of the
financial statements referred to in Section 4.01 thereof and such
other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent,
the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible
Assignee; (iv) appoints and authorizes the Administrative Agent
to take such action as agent on its behalf and to exercise such
powers under the Credit Agreement as are delegated to the
Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it
will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement are
required to be performed by it as a Lender; [and] (vi) specifies
as its Domestic Lending Office (and address for notices) and
Eurodollar Lending Office the offices set forth beneath its name
on the signature pages hereof [and (vii) attaches the forms
prescribed by the Internal Revenue Service of the United States
certifying as to the Assignee's status for purposes of
determining exemption from United States withholding taxes with
respect to all payments to be made to the Assignee under the
Credit Agreement and the Notes or such other documents as are
necessary to indicate that all such payments are subject to such
rates at a rate reduced by an applicable tax treaty].*
4. Following the execution of this Assignment and
Acceptance by the Assignor and the Assignee, it will be delivered
to the Administrative Agent for acceptance and recording by the
Administrative Agent. The effective date of this Assignment and
Acceptance shall be the date of acceptance thereof by the
Administrative Agent, unless otherwise specified on Schedule 1
hereto (the "Effective Date").
* If the Assignee is organized under the laws of a
jurisdiction outside the United States.
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5. Upon such acceptance and recording by the
Administrative Agent, as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under
the Credit Agreement.
6. Upon such acceptance and recording by the
Administrative Agent, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit
Agreement and the A Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal,
interest, Facility Fees and Utilization Fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make
all appropriate adjustments in payments under the Credit
Agreement and the A Notes for periods prior to the Effective Date
directly between themselves.
7. This Assignment and Acceptance shall be governed
by, and construed in accordance with, the law of the State of New
York.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed by their respective
officers thereunto duly authorized, as of the date first above
written, such execution being made on Schedule 1 hereto.
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SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
Percentage assigned to Assignee _______________%
Assignee's Commitment $______________
Aggregate outstanding principal
amount of A Advances assigned $______________
Principal Amount of A Note
payable to Assignee $______________
Principal Amount of A Note
payable to Assignor $______________
Effective Date (if other than
date of acceptance by
Administrative Agent)* __________ __, 199__
[NAME OF ASSIGNOR], as Assignor
By______________________________
Title:
[NAME OF ASSIGNEE], as Assignee
By______________________________
Title:
Domestic Lending Office:
Eurodollar Lending Office:
Accepted this ____ day
of _______, 199__
CITIBANK, N.A., as
Administrative Agent
By_____________________
Title:
* This date should be no earlier than the date of acceptance
by the Administrative Agent.
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EXHIBIT D
DESIGNATION AGREEMENT
Dated _____________ __, 199__
Reference is made to the Credit Agreement dated as of
August 31, 1994 (the "Credit Agreement") among TRINOVA
Corporation, an Ohio corporation (the "Borrower"), the Lenders
(as defined in the Credit Agreement) and Citibank, N.A., as
Administrative Agent for the Lenders (the "Administrative
Agent"). Terms defined in the Credit Agreement are used herein
with the same meaning.
____________ (the "Designator") and ____________ (the
"Designee") agree as follows:
1. The Designator hereby designates the Designee, and
the Designee hereby accepts such designation, to have a right to
make B Advances pursuant to Section 2.03 of the Credit Agreement.
2. The Designator makes no representation or warranty
and assumes no responsibility with respect to (i) any statements,
warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant
thereto and (ii) the financial condition of the Borrower or the
performance or observance by the Borrower of any of its
obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto.
3. The Designee (i) confirms that it has received a
copy of the Credit Agreement, together with copies of the
financial statements referred to in Section 4.01 thereof and such
other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into this
Designation Agreement; (ii) agrees that it will, independently
and without reliance upon the Administrative Agent, the
Designator or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is a
Designated Bidder; (iv) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf
and to exercise such powers under the Credit Agreement as are
delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto;
(v) agrees that it will perform in accordance with their terms
all of the obligations which by the terms of the Credit
Agreement
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are required to be performed by it as a Lender; and (vi)
specifies as its Applicable Lending Office with respect to B
Advances (and address for notices) the offices set forth beneath
its name on the signature pages hereof.
4. Following the execution of this Designation
Agreement by the Designator and its Designee, it will be
delivered to the Administrative Agent for acceptance and
recording by the Administrative Agent. The effective date of
this Designation Agreement shall be the date of acceptance
thereof by the Administrative Agent, unless otherwise specified
on the signature page hereto (the "Effective Date").
5. Upon such acceptance and recording by the
Administrative Agent, as of the Effective Date, the Designee
shall be a party to the Credit Agreement with a right to make B
Advances as a Lender pursuant to Section 2.03 of the Credit
Agreement and the rights and obligations of a Lender related
thereto.
6. This Designation Agreement shall be governed by,
and construed in accordance with, the laws of the State of New
York.
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IN WITNESS WHEREOF, the parties hereto have caused this
Designation Agreement to be executed by their respective officers
thereunto duly authorized, as of the date first above written.
Effective Date*: _____________ __, 199__
[NAME OF DESIGNATOR]
By_______________________
Title:
[NAME OF DESIGNEE]
By_______________________
Title:
Applicable Lending
Office (and address
for notices)
__________________________
__________________________
__________________________
__________________________
Accepted this ____ day
of _____________, 199__
CITIBANK, N.A., as
Administrative Agent
By______________________
Title:
* This date should be no earlier than the date of acceptance
by the Administrative Agent.
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EXHIBIT E
[Form of Opinion of Counsel of the Borrower]
August __, 1994
To the Banks party to the
Credit Agreement referred to
below and Citibank, N.A., as
Administrative Agent
Ladies and Gentlemen:
I have acted as counsel to TRINOVA Corporation (the
"Borrower") in connection with the Credit Agreement (the "Credit
Agreement") dated as of August 31, 1994, among the Borrower, the
lenders named therein and Citibank, N.A., as Administrative
Agent, providing for loans to be made by said lenders to the
Borrower in an aggregate principal amount not exceeding
$175,000,000 and the Notes. Terms defined in the Credit
Agreement are used herein as defined therein. This opinion is
being delivered pursuant to Section 3.01(d) of the Credit
Agreement.
In rendering the opinion expressed below, I, or
attorneys under my supervision, have examined the following
agreements, instruments and other documents:
(a) the Credit Agreement;
(b) the Notes; and
(c) such corporate records of the Borrower and such
other documents as I have deemed necessary as a
basis for the opinions expressed below.
The agreements, instruments and other documents referred to in
the foregoing lettered clauses (other than clause (c) above) are
collectively referred to as the "Credit Documents".
In my examination, I have assumed the genuineness of
all signatures, the authenticity of all documents submitted to me
as originals and the conformity with authentic original documents
of all documents submitted to me as copies. When relevant facts
were not independently established, I have relied upon statements
of governmental officials and upon representations made in or
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pursuant to the Credit Documents and certificates of appropriate
representatives of the Borrower.
In rendering the opinions expressed below, I have
assumed, with respect to all of the documents referred to in this
opinion letter, that (except, to the extent set forth in the
opinions expressed below, as to the Borrower):
(i) such documents have been duly authorized by, have
been duly executed and delivered by, and
constitute legal, valid, binding and enforceable
obligations of, all of the parties to such
documents;
(ii) all signatories to such documents have been duly
authorized; and
(iii) all of the parties to such documents are duly
organized and validly existing and have the power
and authority (corporate or other) to execute,
deliver and perform such documents.
Based upon and subject to the foregoing and subject
also to the comments and qualifications set forth below, and
having considered such questions of law as I have deemed
necessary as a basis for the opinions expressed below, I am of
the opinion that:
1. The Borrower is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Ohio, and is in good standing in each other
jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification
and where failure to qualify would have a material adverse
effect on the Borrower. The Borrower has not received any
notice from the authorities of any jurisdiction claiming
that the Borrower is required to be qualified as a foreign
corporation in any jurisdiction where it is not presently
qualified.
2. The Borrower has all requisite corporate power to
carry on its business and own its properties, to execute and
deliver, and to perform its obligations under, the Credit
Documents, and to borrow under the Credit Agreement.
3. The execution, delivery and performance by the
Borrower of each Credit Document, and the borrowings by the
Borrower under the Credit Agreement, have been duly
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authorized by all necessary corporate action on the part of
the Borrower.
4. Each Credit Document has been duly executed and
delivered by the Borrower.
5. The stated choice of law which governs the Credit
Documents is the law of the State of New York. However, if
the Credit Documents were stated to be governed by and
construed in accordance with the law of the State of Ohio,
or if a court of the State of Ohio were to apply the law of
the State of Ohio to the Credit Documents, each Credit
Document would nevertheless constitute the legal, valid and
binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as the
enforceability of the Credit Documents (a) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights of
creditors generally and (b) is subject to the application of
general principles of equity (regardless of whether
considered in a proceeding in equity or at law), including,
without limitation, (i) the possible unavailability of
specific performance, injunctive relief or any other
equitable remedy and (ii) concepts of materiality,
reasonableness, good faith and fair dealing.
6. No authorization, approval or consent of, and no
notice to or filing or registration with, any governmental
or regulatory authority or agency of the United States of
America or the State of Ohio is required on the part of the
Borrower for the execution, delivery or performance by the
Borrower of any of the Credit Documents or for the
borrowings by the Borrower under the Credit Agreement.
7. The execution, delivery and performance by the
Borrower of, and the consummation by the Borrower of the
transactions contemplated by, the Credit Documents do not
and will not (a) violate any provision of its Articles of
Incorporation, Code of Regulations or By-Laws, (b) violate
any law, rule or regulation applicable to the Borrower,
(c) violate any order, writ, injunction or decree of any
court or governmental authority or agency or any arbitral
award applicable to the Borrower or any of its Subsidiaries
of which I have knowledge (after due inquiry) or (d) except
as is disclosed in the Credit Agreement, including the
Schedules thereto, result in a breach of, constitute a
default under, require any consent under, or result in the
acceleration or required prepayment of any indebtedness
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pursuant to the terms of, any agreement or instrument of
which I have knowledge (after due inquiry) to which the
Borrower or any of its Subsidiaries is a party or by which
any of them is bound or to which any of them is subject, or
result in the creation or imposition of any Lien upon any
property of the Borrower pursuant to, the terms of any such
agreement or instrument.
8. I have no knowledge (after due inquiry) of any
legal or arbitral actions or proceedings, or any actions or
proceedings by or before any governmental or regulatory
authority or agency or any arbitrator, pending or threatened
against or affecting the Borrower or any of its Subsidiaries
or any of their respective properties that, if adversely
determined or reduced to a judgment, could have a material
adverse effect on the consolidated earnings, financial
condition or operations of Borrower and its Subsidiaries.
The foregoing opinions are subject to the following
comments and qualifications:
(A) The enforceability of Section 8.04(b) of the
Credit Agreement may be limited by laws rendering
unenforceable (i) indemnification contrary to Federal or
state securities laws and the public policy underlying such
laws and (ii) the release of a party from, or the
indemnification of a party against, liability for its own
wrongful or negligent acts under certain circumstances.
(B) The enforceability of provisions in the Credit
Documents to the effect that terms may not be waived or
modified except in writing may be limited under certain
circumstances.
(C) I express no opinion as to (i) the effect of the
laws of any jurisdiction in which any Lender is located that
limit the interest, fees or other charges such Lender may
impose, (ii) Section 2.16 of the Credit Agreement, (iii)
Section 7.05 of the Credit Agreement, (iv) the second
sentence of Section 8.08 of the Credit Agreement, insofar as
such sentence relates to the subject matter jurisdiction of
the United States District Court for the Southern District
of New York to adjudicate any controversy related to the
Credit Documents, (v) the third sentence of Section 8.08 of
the Credit Agreement and (vi) Section 8.09 of the Credit
Agreement.
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The foregoing opinions are limited to matters involving
the Federal laws of the United States and the law of the State of
Ohio, and I do not express any opinion as to the laws of any
other jurisdiction.
At the request of the Borrower, this opinion letter is,
pursuant to Section 3.01(d) of the Credit Agreement, provided to
you by me in my capacity as Associate General Counsel of the
Borrower and may not be relied upon by any Person for any purpose
other than in connection with the transactions contemplated by
the Credit Agreement without, in each instance, my prior written
consent.
Very truly yours,
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EXHIBIT F
[Form of Opinion of Special New York Counsel to the
Administrative Agent]
August ___, 1994
To the Banks party to the
Credit Agreement referred to
below and Citibank, N.A., as
Administrative Agent
Ladies and Gentlemen:
We have acted as special New York counsel to Citibank,
N.A., as Administrative Agent, in connection with (i) the Credit
Agreement dated as of August 31, 1994 (the "Credit Agreement")
among TRINOVA Corporation (the "Borrower"), the lenders named
therein and Citibank, N.A., as Administrative Agent, providing
for loans to be made by said lenders to the Borrower in an
aggregate principal amount not exceeding $175,000,000 and
(ii) the various other agreements and instruments referred to in
the next following paragraph. Terms defined in the Credit
Agreement are used herein as defined therein. This opinion is
being delivered pursuant to Section 3.01(e) of the Credit
Agreement.
In rendering the opinion expressed below, we have
examined the following agreements, instruments and other
documents:
(a) the Credit Agreement;
(b) the Notes; and
(c) such corporate records of the Borrower and such
other documents as we have deemed necessary as a
basis for the opinions expressed below.
The agreements, instruments and other documents referred to in
the foregoing lettered clauses (other than clause (c) above) are
collectively referred to as the "Credit Documents".
In our examination, we have assumed the genuineness of
all signatures, the authenticity of all documents submitted to us
as originals and the conformity with authentic original documents
of all documents submitted to us as copies. When relevant facts
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were not independently established, we have relied upon
statements of governmental officials and upon representations
made in or pursuant to the Credit Documents and certificates of
appropriate representatives of the Borrower.
In rendering the opinions expressed below, we have
assumed, with respect to all of the documents referred to in this
opinion letter, that:
(i) such documents have been duly authorized by, have
been duly executed and delivered by, and (except
to the extent set forth in the opinions below as
to the Borrower) constitute legal, valid, binding
and enforceable obligations of, all of the parties
to such documents;
(ii) all signatories to such documents have been duly
authorized; and
(iii) all of the parties to such documents are duly
organized and validly existing and have the power
and authority (corporate or other) to execute,
deliver and perform such documents.
Based upon and subject to the foregoing and subject
also to the comments and qualifications set forth below, and
having considered such questions of law as we have deemed
necessary as a basis for the opinions expressed below, we are of
the opinion that each of the Credit Documents constitutes the
legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms, except as may
be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting the rights of
creditors generally and except as the enforceability of the
Credit Documents is subject to the application of general
principles of equity (regardless of whether considered in a
proceeding in equity or at law), including, without limitation,
(a) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b) concepts
of materiality, reasonableness, good faith and fair dealing.
The foregoing opinions are subject to the following
comments and qualifications:
(A) The enforceability of Section 8.04(b) of the
Credit Agreement may be limited by laws rendering
unenforceable (i) indemnification contrary to Federal or
state securities laws and the public policy underlying such
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laws and (ii) the release of a party from, or the
indemnification of a party against, liability for its own
wrongful or negligent acts under certain circumstances.
(B) The enforceability of provisions in the Credit
Documents to the effect that terms may not be waived or
modified except in writing may be limited under certain
circumstances.
(C) We express no opinion as to (i) the effect of the
laws of any jurisdiction in which any Lender is located
(other than the State of New York) that limit the interest,
fees or other charges such Lender may impose, (ii) the
second sentence of Section 2.16 of the Credit Agreement,
(iii) the second sentence of Section 8.08 of the Credit
Agreement, insofar as such sentence relates to the subject
matter jurisdiction of the United States District Court for
the Southern District of New York to adjudicate any
controversy related to the Credit Documents, (iv) the waiver
of inconvenient forum set forth in Section 8.08 of the
Credit Agreement with respect to proceedings in the United
States District Court for the Southern District of New York
and (v) Section 8.09 of the Credit Agreement.
The foregoing opinions are limited to matters involving
the Federal laws of the United States and the law of the State of
New York, and we do not express any opinion as to the laws of any
other jurisdiction.
This opinion letter is, pursuant to Section 3.01(e) of
the Credit Agreement, provided to you by us in our capacity as
special New York counsel to the Administrative Agent and may not
be relied upon by any Person for any purpose other than in
connection with the transactions contemplated by the Credit
Agreement without, in each instance, our prior written consent.
Very truly yours,
WFC/DCS
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