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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: February 23, 1994
Commission File Number 1-4238
LORAL CORPORATION
600 Third Avenue
New York, New York 10016
Telephone: (212) 697-1105
State of incorporation: New York
IRS identification number: 13-1718360
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Item 5: Other Events
On February 23, 1994, the Registrant entered into a five-year $1,200,000,000
and a 364 day $500,000,000 unsecured revolving credit facility with a group of
banks, replacing the Registrant's existing $600,000,000 facility. The
revolving credit loans bear interest at various rates based on the Base rate
or on margins above the CD rate or EuroDollar rate, and unborrowed available
amounts are subject to a commitment fee. The margins and the commitment fee
are subject to adjustment based upon the rating of the Registrant's unsecured
senior debt.
Item 7: Financial Statements, Pro forma Financial Information and Exhibits
Filed herewith (-)
or incorporated
Exhibits by reference
4.1 Revolving Credit Agreement among -
Loral Corporation, Certain Banks,
Morgan Guaranty Trust Company of New
York, Chemical Bank, Barclays Bank
PLC, and Continental Bank, N.A.,
dated as of February 23, 1994.
4.2 364 Day Revolving Credit Agreement -
among Loral Corporation, Certain
Banks, Morgan Guaranty Trust Company
of New York, Chemical Bank, Barclays
Bank PLC, and Continental Bank, N.A.,
dated as of February 23, 1994.
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 hereunto duly authorized.
LORAL CORPORATION
Registrant
Date: March 10, 1994 /s/ MICHAEL B. TARGOFF
Michael B. Targoff
Senior Vice President
and Secretary
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CONFORMED COPY
364-DAY
REVOLVING CREDIT AGREEMENT
among
LORAL CORPORATION,
CERTAIN BANKS,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Documentation Agent and Co-Arranger
CHEMICAL BANK,
as Administrative Agent and Co-Arranger
BARCLAYS BANK PLC,
as Agent
and
CONTINENTAL BANK, N.A.,
as Agent
Dated as of February 23, 1994
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TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . 16
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS . . . . . . . . . . . . . . . 16
2.1 Revolving Credit Commitments . . . . . . . . . . . . . . . . . . . 16
2.2 Revolving Credit Notes . . . . . . . . . . . . . . . . . . . . . . 17
2.3 Procedure for Revolving Credit Borrowing . . . . . . . . . . . . . 17
2.4 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . 18
(B) Upfront Fee . . . . . . . . . . . . . . . . . . . . . . . . . 18
(c) Other Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.5 Termination or Reduction of Commitments . . . . . . . . . . . . . . 18
2.6 Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.7 Conversion and Continuation Options . . . . . . . . . . . . . . . . 20
2.8 Minimum Amounts of Tranches . . . . . . . . . . . . . . . . . . . . 21
2.9 Interest Rates and Payment Dates . . . . . . . . . . . . . . . . . 21
2.10 Computation of Interest and Fees . . . . . . . . . . . . . . . . . 22
2.11 Inability to Determine Interest Rate . . . . . . . . . . . . . . . 23
2.12 Pro Rata Treatment and Payments . . . . . . . . . . . . . . . . . . 23
2.13 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.14 Other Costs; Increased Costs . . . . . . . . . . . . . . . . . . . 25
2.15 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.16 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2.17 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . 30
3.1 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . 30
3.2 No Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.3 Corporate Existence; Compliance with Law . . . . . . . . . . . . . 30
3.4 Corporate Power; Authorization; Enforceable Obligations . . . . . . 31
3.5 No Legal Bar . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.6 No Material Litigation . . . . . . . . . . . . . . . . . . . . . . 31
3.7 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.8 Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . 32
3.9 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.10 Federal Regulations . . . . . . . . . . . . . . . . . . . . . . . . 32
3.11 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.12 Investment Company Act; Other Regulations . . . . . . . . . . . . . 33
3.13 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.14 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . 33
3.15 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . 34
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SECTION 4. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . 34
4.1 Conditions of Initial Loans . . . . . . . . . . . . . . . . . . . . 34
4.2 Conditions to all Loans . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . 37
5.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . 38
5.2 Certificates; Other Information . . . . . . . . . . . . . . . . . . 38
5.3 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . 39
5.4 Conduct of Business and Maintenance of Existence . . . . . . . . . 39
5.5 Maintenance of Property; Insurance . . . . . . . . . . . . . . . . 39
5.6 Inspection of Property; Books and Records; Discussions . . . . . . 40
5.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.8 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . 41
5.9 Ratings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . 42
6.1 Financial Condition Covenants . . . . . . . . . . . . . . . . . . . 42
6.2 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
6.3 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . 43
6.4 Limitation on Fundamental Changes . . . . . . . . . . . . . . . . . 45
6.5 Limitation on Restricted Payments . . . . . . . . . . . . . . . . . 46
6.6 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.7 Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.8 Sale and Leaseback . . . . . . . . . . . . . . . . . . . . . . . . 47
6.9 Corporate Documents . . . . . . . . . . . . . . . . . . . . . . . . 48
6.10 Restrictions on Subsidiaries. . . . . . . . . . . . . . . . . . . . 48
SECTION 7. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 8. THE AGENTS . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.1 Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.2 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . 52
8.3 Exculpatory Provisions . . . . . . . . . . . . . . . . . . . . . . 52
8.4 Reliance by Agents . . . . . . . . . . . . . . . . . . . . . . . . 52
8.5 Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.6 Non-Reliance on Agents and Other Banks . . . . . . . . . . . . . . 53
8.7 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . 54
8.8 Each Agent in Its Individual Capacity . . . . . . . . . . . . . . . 54
8.9 Successor Agents . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 9. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 55
9.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . 55
9.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
9.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . 57
9.4 Survival of Representations and Warranties . . . . . . . . . . . . 57
9.5 Payment of Expenses and Taxes . . . . . . . . . . . . . . . . . . . 57
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9.6 Successors and Assigns; Participations; Purchasing Banks . . . . . 58
9.7 Adjustments; Set-off . . . . . . . . . . . . . . . . . . . . . . . 61
9.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.9 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.10 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.11 Submission To Jurisdiction; Waivers . . . . . . . . . . . . . . . . 63
9.12 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . 63
9.13 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.14 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Schedules:
SCHEDULE I - Commitments and Commitment Percentages
SCHEDULE 3.1 - Certain Liabilities
SCHEDULE 3.13 - Certain Subsidiaries
SCHEDULE 6.4 - Existing Contractual Obligations
SCHEDULE 6.6 - Certain Investments
Exhibits:
EXHIBIT A - Form of Note
EXHIBIT B-1 - Form of Opinion of Willkie Farr & Gallagher
EXHIBIT B-2 - Form of Opinion of General Counsel
EXHIBIT C - Form of Closing Certificate
EXHIBIT D - Form of Commitment Transfer Supplement
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364-DAY REVOLVING CREDIT AGREEMENT dated as of February 23, 1994
among LORAL CORPORATION, a New York corporation (the "Company"), the several
financial institutions parties from time to time to this Agreement
(collectively, the "Banks"; individually, a "Bank"), MORGAN GUARANTY TRUST
COMPANY OF NEW YORK, a New York banking corporation ("Morgan"), as
documentation agent for the Banks hereunder (in such capacity, the
"Documentation Agent") and co-arranger (each of Morgan and Chemical in such
capacity is a "Co-Arranger"), CHEMICAL BANK, a New York banking corporation
("Chemical"), as administrative agent for the Banks hereunder (in such
capacity, the "Administrative Agent") and as Co-Arranger, and BARCLAYS BANK
PLC, a banking corporation organized under the laws of England ("Barclays"),
and CONTINENTAL BANK, N.A., a national banking corporation ("Continental"), as
agents for the Banks hereunder (each of Barclays and Continental in
such capacity is an "Agent" and, collectively with the Administrative Agent
and the Documentation Agent, the "Agents").
W I T N E S S E T H :
WHEREAS, the Company has requested the Banks to make revolving
credit loans to the Company in an aggregate principal amount not to exceed
$500,000,000 at any time outstanding, the proceeds of which may be used for
general corporate purposes; and
WHEREAS, the Banks are willing to make such Loans to the Company
upon the terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms
have the following meanings:
"Affiliate": with respect to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, a
Person shall be deemed to be "controlled by" any other Person which
possesses, directly or indirectly, power either to (i) vote 10% or more
of the securities having ordinary voting power for the election of
directors of such Person or (ii) direct or cause the direction of the
management and policies of such Person whether by contract or otherwise.
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"Agreement": this 364-Day Revolving Credit Agreement, as amended,
supplemented or modified from time to time.
"Applicable Margin": with respect to each day (a) for each
Eurodollar Loan and C/D Rate Loan when the Ratings are as set forth
below, the rate per annum set forth below opposite such Ratings:
Applicable Applicable
Ratings Eurodollar C/D Rate
Moody's S&P Margin Margin
A2 A 0.3500% 0.4750%
A3 A- 0.3750% 0.5000%
Baa1 BBB+ 0.4500% 0.5750%
Baa2 BBB 0.5250% 0.6500%
Baa3 BBB- 0.6250% 0.7500%
Any other 0.7500% 0.8750%
Rating lower than
those set forth above
; and (b) for each Base Rate Loan, 0% (unless either Rating shall be
lower than Baa3 or BBB-, in which case the Applicable Margin for such
Base Rate Loan shall be 0.25%); provided, that if the Ratings are split,
the Applicable Margin shall be the one applicable to the lower Rating;
and provided further, that if the Loans or the Commitments shall be
designated a "highly leveraged transaction" by any applicable bank
regulator or by the Administrative Agent (if directed to do so by any
applicable Governmental Authority or if required to do so pursuant to
rules, regulations or interpretations promulgated by any applicable
Governmental Authority), in either case employing a definition of "highly
leveraged transaction" no more inclusive than the definition in effect
prior to June 30, 1992, the Administrative Agent shall so notify the
Banks and the Company and, on and after the date of such notification,
the Applicable Margin shall be 2.5%, 2.625% and 1.5% for each Eurodollar
Loan, C/D Rate Loan and Base Rate Loan, respectively.
"Available Commitment": as to any Bank, at a particular time, an
amount equal to such Bank's Commitment Percentage of the excess, if any,
of (a) the aggregate Commitments at such time over (b) the aggregate
outstanding principal amount of the Loans at such time; collectively, as
to all the Banks, the "Available Commitments".
"Base Rate": at a particular date, the higher of (a) the rate of
interest publicly announced by the
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Administrative Agent in New York, New York from time to time as its
reference rate and (b) 1/2 of 1% above the rate set forth for such date
opposite the caption "Federal Funds (Effective)" in the weekly
statistical release designated as "H.15(519)", or any successor
publication, published by the Board of Governors of the Federal Reserve
System. The reference rate is not intended to be the lowest rate of
interest charged by the Administrative Agent in connection with
extensions of credit to debtors.
"Base Rate Loans": Loans hereunder at such time as they are made
and/or being maintained at a rate of interest based upon the Base Rate.
"Borrowing Date": any day specified by the Company in a notice
pursuant to Section 2.3 as a date on which the Company requests the Banks
to make Loans hereunder.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law
to close.
"Cash Collateral": as defined in Section 2.6(c).
"Cash Collateral Account": as defined in Section 2.6(c).
"Cash Equivalents": (i) securities issued or directly and fully
guaranteed or insured by the United States Government or any agency or
instrumentality thereof having maturities of not more than twelve months
from the date of acquisition, (ii) time deposits and certificates of
deposit of any Bank or any domestic commercial bank having capital and
surplus in excess of $500,000,000 the holding company of which has a
commercial paper rating meeting the requirements specified in clause (iv)
below having maturities of not more than twelve months from the date of
acquisition, (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses
(i) and (ii) entered into with any Bank or bank meeting the
qualifications specified in clause (ii) above, (iv) commercial paper
rated at least A-1 or the equivalent thereof by S&P or P-1 or the
equivalent thereof by Moody's and in either case maturing within twelve
months after the date of acquisition, (v) tax exempt obligations rated at
least A2 or the equivalent thereof by Moody's and A or the equivalent
thereof by S&P, (vi) money market mutual funds, and (vii) commercial
paper (other than commercial paper referred to in the preceding clause
(iv)) rated at least A-2 or the equivalent thereof by S&P or P-2 or the
equivalent thereof by Moody's in an aggregate principal amount not in
excess of 25% of the liquid assets of the Company and its consolidated
Subsidiaries and in either case maturing within twelve months after the
date of acquisition.
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"C/D Assessment Rate": for any day as applied to any C/D Rate Loan,
the net annual assessment rate (rounded upward to the nearest 1/100th of
1%) determined by the Administrative Agent to be payable on such day to
the Federal Deposit Insurance Corporation or any successor ("FDIC") for
FDIC's insuring time deposits made in Dollars at offices of the
Administrative Agent in the United States.
"C/D Base Rate": with respect to each day during each Interest
Period pertaining to a C/D Rate Loan, the rate of interest per annum
determined by the Administrative Agent to be the arithmetic average
(rounded upward to the nearest 1/100th of 1%) of the respective rates
notified to the Administrative Agent by each of the Reference Banks as
the average rate bid at 9:00 A.M., New York City time, or as soon
thereafter as practicable, on the first day of such Interest Period by a
total of three certificate of deposit dealers of recognized standing
selected by such Reference Bank for the purchase at face value from such
Reference Bank of its certificates of deposit in an amount comparable to
the C/D Rate Loan of such Reference Bank to which such Interest Period
applies and having a maturity comparable to such Interest Period.
"C/D Rate": with respect to each day during each Interest Period
pertaining to a C/D Rate Loan, a rate per annum determined for such day
in accordance with the following formula (rounded upward to the nearest
1/100th of 1%):
C/D Base Rate + C/D Assessment Rate
[ DIVIDED BY ]
1.00 - C/D Reserve Percentage
"C/D Rate Loans": Loans the rate of interest applicable to which is
based upon the C/D Rate.
"C/D Reserve Percentage": for any day as applied to any C/D Rate
Loan, that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal Reserve
System (or any successor), for determining the maximum reserve
requirement for a member bank of the Federal Reserve System in New York
City with deposits exceeding one billion Dollars in respect of new non-
personal time deposits in Dollars in New York City having a maturity
comparable to the Interest Period for such C/D Rate Loan and in an amount
of $100,000 or more.
"Change in Control": an event or series of events as a result of
which (i) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"))
is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act) of shares entitling the holder thereof to cast
more than 30% of the votes for the election
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of directors of the Company; or (ii) at any time Continuing Directors do
not constitute a majority of the Board of Directors of the Company.
"Closing Date": February 23, 1994.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment": as to any Bank, its obligation to make Loans to the
Company in an aggregate principal amount not to exceed at any one time
outstanding the amount set forth opposite such Bank's name in Schedule I
hereto, as such amount may be reduced from time to time as provided
herein; collectively, as to all the Banks, the "Commitments".
"Commitment Fee Rate": with respect to each day when the Ratings
are as set forth below, the rate per annum set forth below opposite such
Ratings:
Ratings
Moody's S&P Commitment Fee Rate
A2 A 0.0800%
A3 A- 0.1000%
Baa1 BBB+ 0.1250%
Baa2 BBB 0.1500%
Baa3 BBB- 0.1750%
Any other Rating 0.2000%
lower than those
set forth above
; provided, that if the Ratings are split, the Commitment Fee Rate shall
be the one applicable to the lower Rating; and provided further, that if
the Loans or the Commitments shall be designated a "highly leveraged
transaction" by any applicable bank regulator or by the Administrative
Agent (if directed to do so by any applicable Governmental Authority or
if required to do so pursuant to rules, regulations or interpretations
promulgated by any applicable Governmental Authority), in either case
employing a definition of "highly leveraged transaction" no more
inclusive than the definition in effect prior to June 30, 1992, the
Administrative Agent shall so notify the Banks and the Company and, on
and after the date of such notification, the Commitment Fee Rate shall be
0.5000%.
<PAGE>10
"Commitment Percentage": as to any Bank, the percentage of the
aggregate Commitments constituted by such Bank's Commitment.
"Commitment Period": the period from and including the date hereof
to but not including the Termination Date.
"Commitment Transfer Supplement": a Commitment Transfer Supplement,
substantially in the form of Exhibit D.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Company within the
meaning of Section 4001 of ERISA or is part of a group which includes the
Company and which is treated as a single employer under Section 414 of
the Code.
"Consolidated Net Income": for any period, the consolidated net
income (or deficit) of the Company and its Subsidiaries for such period
(taken as a cumulative whole), determined in accordance with GAAP.
"Consolidated Net Worth": at a particular date, all amounts which
would be included under shareholders' equity on a consolidated balance
sheet of the Company and its Subsidiaries determined on a consolidated
basis in accordance with GAAP as at such date.
"Contingent Obligation": as to any Person, any obligation of such
Person guaranteeing or in effect guaranteeing any Indebtedness, leases,
dividends or other obligations quantified in accordance with the last
sentence of this definition (the "primary obligations") of any other
Person (the "primary obligor"), other than a Wholly Owned Subsidiary, in
any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent (a)
to purchase any such primary obligation or any property constituting
direct or indirect security therefor, (b) to advance or supply funds (i)
for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor,
(c) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation
or (d) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the
term Contingent Obligation shall not include (i) endorsements of
instruments for deposit or collection in the ordinary course of business
and (ii) performance guarantees by the Company made in the ordinary
course of business of contracts entered into by SSL. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated
or
<PAGE>11
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the
amount reasonably anticipated to be payable by the Company in respect of
such Contingent Obligation as determined by the Company in good faith.
"Continuing Director": at any date a member of the Company's Board
of Directors who was a member of such Board 12 months prior to such date.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Customer Advances": at any time, advances and prepayments received
by the Company or any Subsidiary pursuant to written contracts in the
ordinary course of business less costs incurred by the Company or any
Subsidiary in the performance of such contracts.
"Default": any of the events specified in Section 7, whether or not
any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"Dollars" and "$": dollars in lawful currency of the United States
of America.
"Domestic Dollar Loans": the collective reference to C/D Rate Loans
and Base Rate Loans.
"Domestic Lending Office": initially, the office of each Bank
designated as such in Schedule I; thereafter, such other office of such
Bank, if any, located within the United States which shall be making or
maintaining Base Rate Loans or C/D Rate Loans.
"Effective Date": the first date on which this Agreement shall have
been signed by a duly authorized officer of each of the Company, the
Agents and each of the Banks whose name is set forth on the signature
pages hereto.
"8-3/8% Indenture": the Indenture dated as of November 1, 1992
between the Company and Nationsbank of Georgia, National Association, as
trustee, pursuant to which $100,000,000 aggregate principal amount of the
Company's Senior Debentures due January 15, 2023 were issued, as the same
may be amended, modified or supplemented.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees or requirements of any Governmental Authority regulating,
relating to or imposing
<PAGE>12
liability or standards of conduct concerning environmental protection
matters, including without limitation, Hazardous Materials, as now or may
at any time hereafter be in effect.
"Equity Issuance Proceeds": an amount equal to (a) the aggregate
cash proceeds (other than any such proceeds received from the issuance or
sale of capital stock to a Subsidiary or received from the issuance of
Redeemable Stock) received by the Company or any Subsidiary from such
issuance or sale, as the case may be, less fees and expenses, including
underwriter's discount, paid in connection with such issuance or sale, as
the case may be; (b) the principal amount of Indebtedness of the Company
that has been converted into or exchanged for capital stock (other than
capital stock issued to a Subsidiary and other than Redeemable Stock);
(c) the fair market value (as determined by the Board of Directors of the
Company in good faith) of any assets purchased by the Company or any of
its Wholly Owned Subsidiaries in exchange for the issuance of capital
stock of the Company (other than capital stock issued to a Subsidiary and
other than Redeemable Stock); and (d) if the Company issues capital stock
to any 401(k) plan of the Company in satisfaction of its obligation to
make contributions thereto, the amount of the contribution satisfied.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurodollar Business Day": any Business Day on which dealings in
foreign currencies and exchange between banks may be carried on in
London, England.
"Eurodollar Lending Office": initially, the office of each Bank
designated as such in Schedule I; thereafter, such other office of such
Bank, if any, which shall be making or maintaining Eurodollar Loans.
"Eurodollar Loans": Loans hereunder at such time as they are made
and/or being maintained at a rate of interest based upon the Eurodollar
Rate.
"Eurodollar Rate": with respect to the Interest Period pertaining
to a Eurodollar Loan, the rate per annum equal to the average (rounded
upwards to the nearest whole multiple of 1/100th of 1%) of the respective
rates notified to the Administrative Agent by the Reference Banks as the
rate at which each of their Eurodollar Lending Offices is offered Dollar
deposits two Eurodollar Business Days prior to the beginning of such
Interest Period in the interbank eurodollar market where the eurodollar
and foreign currency and exchange operations of such Eurodollar Lending
Office are customarily conducted at or about 10:00 A.M., New York City
time, for delivery on the first day of such Interest
<PAGE>13
Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Loan of such Reference Bank to
which such Interest Period applies.
"Event of Default": any of the events specified in Section 7;
provided, that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, event or act has been satisfied.
"Excluded Employee Loans": loans or advances to directors, officers
or employees of the Company or any Wholly Owned Subsidiary the principal
amount of which, when added to the principal amount of existing such
loans or advances, would not exceed $5,000,000.
"Federal Systems": the Federal Systems business of the
International Business Machines Corporation ("IBM") which will be
acquired by the Company under the Asset Purchase Agreement dated as of
December 12, 1993 between the Company and IBM, as amended, modified or
supplemented from time to time.
"Financing Lease": (a) any lease of property, real or personal, the
then present value of the minimum rental commitment thereunder of which
should, in accordance with GAAP, be capitalized on a balance sheet of the
lessee, and (b) any other such lease the obligations under which are
capitalized on a consolidated balance sheet of the Company and its
Subsidiaries.
"Funded Debt": of a Person, at a particular date, the sum (without
duplication) at such date of (a) all indebtedness of such Person (i) for
borrowed money or (ii) for the deferred purchase price of property or
services or (iii) which is evidenced by a note, bond, debenture or
similar instrument, and (b) all obligations under Financing Leases.
"GAAP": generally accepted accounting principles in the United
States of America in effect from time to time.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Hazardous Materials": any hazardous materials, hazardous wastes,
hazardous constituents, hazardous or toxic substances, and petroleum
products (including crude oil or any fraction thereof), defined or
regulated as such in or under any Environmental Law.
<PAGE>14
"Historical Dividends": annual cash dividends on the Company's
common stock in an amount per share not exceeding the amount per share
paid in respect of the Company's common stock for the fiscal quarter
ended December 31, 1993, calculated on an annualized basis; provided,
that in each year beginning in fiscal year 1994 "Historical Dividends"
shall be increased by an amount equal to 10% of Historical Dividends for
the previous year.
"Indebtedness": of a Person, at a particular date, the sum (without
duplication) at such date of (a) Funded Debt, (b) all obligations of such
Person in respect of letters of credit, acceptances, or similar
obligations issued or created for the account of such Person and (c) all
indebtedness or other liabilities secured by any Lien on any property
owned by such Person even though such Person has not assumed or otherwise
become liable for the payment thereof; but excluding any trade or other
account payable in the ordinary course of business (i) which is not
disputed or overdue for a period longer than the period in which such
Person customarily pays such account or (ii) under which the amount owed
is not in excess of $5,000,000.
"Insolvency" or "Insolvent": at any particular time, the condition
that a Multiemployer Plan is insolvent within the meaning of Section 4245
of ERISA.
"Interest Payment Date": (a) as to any Base Rate Loan, the last
day of each calendar month, (b) as to any Eurodollar Loan in respect of
which the Company has selected an Interest Period of one, two or three
months, and as to any C/D Rate Loan in respect of which the Company has
selected an Interest Period of 30, 60 or 90 days, the last day of such
Interest Period, and (c) as to any Eurodollar Loan or C/D Rate Loan
having an Interest Period of six months or 180 days, respectively, each
day which is three months or 90 days, respectively, after the first day
of such Interest Period and the last day of such Interest Period.
"Interest Period": (a) with respect to any Eurodollar Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such Eurodollar
Loan and ending one, two, three or six months thereafter, as
selected by the Company in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan
and ending one, two, three or six months thereafter, as selected by
the
<PAGE>15
Company by irrevocable notice to the Administrative Agent not less
than three Eurodollar Business Days prior to the last day of the
then current Interest Period with respect thereto;
(b) with respect to any C/D Rate Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such C/D Rate
Loan and ending 30, 60, 90 or 180 days thereafter, as selected by
the Company in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such C/D Rate Loan and
ending 30, 60, 90 or 180 days thereafter, as selected by the Company
by irrevocable notice to the Administrative Agent not less than one
Business Day prior to the last day of the then current Interest
Period with respect thereto;
and (c) with respect to any Base Rate Loan, the period commencing on the
borrowing or conversion date, as the case may be, with respect to such
Base Rate Loan and ending 30 days thereafter; provided, that all of the
foregoing provisions relating to Interest Periods are subject to the
following:
(a) if any Interest Period pertaining to a Eurodollar Loan
would otherwise end on a day that is not a Eurodollar Business Day,
such Interest Period shall be extended to the next succeeding
Eurodollar Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month in which
event such Interest Period shall end on the immediately preceding
Eurodollar Business Day;
(b) if any Interest Period pertaining to a C/D Rate Loan or
Base Rate Loan would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding
Business Day;
(c) any Interest Period that would otherwise extend beyond the
Termination Date shall end on the Termination Date;
(d) any Interest Period pertaining to a Eurodollar Loan that
begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurodollar Business Day of a calendar month; and
<PAGE>16
(e) the Company shall select Interest Periods so as not to
require a payment or prepayment of any Eurodollar Loan or C/D Rate
Loan during an Interest Period for such Loan.
"Investment": any advance, loan, extension of credit or capital
contribution to, or purchase of any stock, bonds, notes, debentures,
ownership interests or other securities of, or other investment in, any
Person.
"LAH": Loral Aerospace Holdings, Inc., a Delaware corporation.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference,
priority or other security agreement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any Financing Lease having
substantially the same economic effect as any of the foregoing.
"Loan": as defined in Section 2.1.
"Material Adverse Effect": a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or
prospects of the Company and its Subsidiaries taken as a whole and the
ability of the Company to perform its obligations under this Agreement or
the Notes, or (b) the validity or enforceability of this Agreement or any
of the Notes or the material rights or remedies of the Agents or the
Banks hereunder or thereunder.
"Moody's": Moody's Investors Service, Inc.
"Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"9-1/8% Indenture": the Indenture dated as of January 15, 1992
between the Company and Continental Bank, N.A., as trustee, pursuant
to which $100,000,000 aggregate principal amount of the Company's
Senior Debentures due February 1, 2022 were issued, as the same may
be amended, supplemented or modified.
"Notes": as defined in Section 2.2.
"Original Commitment": $500,000,000.
"Participants": as defined in Section 9.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
<PAGE>17
"Person": an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Plan": at any particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Company or a Commonly
Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Properties": as defined in Section 3.14.
"Purchasing Banks": as defined in Section 9.6(c).
"Rating": the senior unsecured debt rating of the Company (or its
status as unrated) from time to time in effect from S&P or Moody's, as
the case may be.
"Redeemable Stock": means any equity interest which, by its terms
(or by the terms of any security into which it is convertible or for
which it is exchangeable before the date which is 91 days after the
Termination Date), or upon the happening of any event, matures or is
mandatorily redeemable, in whole or in part, prior to the date which is
91 days after the Termination Date, or is, by its terms or upon the
happening of any event, redeemable at the option of the holder thereof,
in whole or in part, at any time prior to the date which is 91 days after
the Termination Date.
"Reference Banks": Chemical, Morgan and Barclays.
"Register": as defined in Section 9.6(d).
"Reorganization": at any particular time, the condition that a
Multiemployer Plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(b)
of ERISA or the regulations thereunder, other than those events as to
which the thirty day notice period is waived under subsections .13, .14,
.16, .18, .19 or .20 of PBGC Reg. 2615.
"Required Banks": at any date, Banks whose Commitments aggregate at
least 66-2/3% of the total Commitments or, if the Commitments have been
terminated, of the outstanding Loans.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents
of such Person, and any law, treaty, rule or regulation or determination
of an
<PAGE>18
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Responsible Officer": the Chairman, the President or any Senior
Vice President of the Company or, with respect to financial matters, the
chief financial officer of the Company.
"Restricted Payments": as defined in Section 6.5.
"Revolving Credit Agreement": the Revolving Credit Agreement dated
as of the date hereof among the Company, the financial institutions from
time to time party thereto, Morgan, as documentation agent and co-
arranger, Chemical, as administrative agent and co-arranger, and Barclays
and Continental, as agents, as the same may be amended, supplemented or
modified.
"7% Indenture": the Indenture dated as of November 1, 1992 between
the Company and Nationsbank of Georgia, as trustee, pursuant to which
$200,000,000 aggregate principal amount of the Company's Senior
Debentures due September 15, 2023 were issued, as the same may be
amended, supplemented or modified.
"S&P": Standard & Poor's Corporation.
"Single Employer Plan": any Plan which is covered by Title IV of
ERISA but which is not a Multiemployer Plan.
"SSL": Space Systems/Loral, Inc., a Delaware corporation.
"Stockholders Agreement": the Stockholders Agreement dated as of
November 13, 1992 by and among Loral Aerospace Corp., LAH, the Company,
Shearson Lehman Brothers Capital Partners II, L.P., Lehman Brothers
Merchant Banking Portfolio Partnership L.P., Lehman Brothers Offshore
Investment Partnership L.P. and Lehman Brothers Offshore Investment
Partnership-Japan L.P., as amended, supplemented or otherwise modified
from time to time.
"Subordinated Debt": any unsecured Indebtedness of the Company or
any of its Subsidiaries, no part of the principal of which is required to
be paid (whether by way of mandatory sinking fund, mandatory redemption
or mandatory prepayment or otherwise) prior to the date which is 30 days
after the Termination Date, and the payment of principal of and interest
on which, and the payment of any other obligations of the Company or such
Subsidiary to the holders of such Subordinated Debt, are subordinated to
the prior payment in full of the obligations and liabilities of the
Company
<PAGE>19
hereunder (including, without limitation, obligations in respect of post-
petition interest).
"Subsidiary": as to any Person, a corporation, partnership or other
entity (a) of which shares of stock or other ownership interests having
ordinary voting power (other than stock or other ownership interests
having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly
through one or more intermediaries, or both, by such Person and (b) which
is consolidated on such Person's financial statements; provided, that SSL
shall be excluded from the definition of "Subsidiary". Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Company.
"Substantial Subsidiary": any Subsidiary of the Company if the book
value of such Subsidiary's assets (determined in accordance with GAAP for
the most recent fiscal quarter for which financial statements are
available) exceeds 3% of the book value of the assets of the Company and
its Subsidiaries taken as a whole (determined on a consolidated basis in
accordance with GAAP for the most recent fiscal quarter for which
financial statements are available).
"Termination Date": February 21, 1995 or such earlier date as the
Commitments shall terminate as provided herein.
"Tranche": the collective reference to Eurodollar Loans or C/D Rate
Loans the Interest Periods with respect to all of which begin on the same
date and end on the same later date (whether or not such Loans shall
originally have been made on the same day). Tranches may be identified
as "Eurodollar Tranches" or "C/D Rate Tranches", as applicable.
"Transfer Effective Date": as defined in each Commitment Transfer
Supplement.
"Transferees": as defined in Section 9.6(f).
"Type": as to any Loan, its nature as a Base Rate Loan, a C/D Rate
Loan or a Eurodollar Loan.
"Unused Commitment": as to any Bank, at a particular time, an
amount equal to such Bank's Commitment Percentage of the excess, if
any, of (a) the aggregate Commitments at such time over (b) the
aggregate outstanding principal amount of the Loans at such time.
<PAGE>20
"Wholly Owned Subsidiary": any Subsidiary of the Company to the
extent at least 80% of the capital stock or other ownership interests of
such Subsidiary, other than directors' or nominees' qualifying shares, is
owned directly or indirectly by the Company; provided, that the term
"Wholly Owned Subsidiary" shall include LAH.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified herein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes or any
certificate or other document made or delivered pursuant hereto.
(b) As used herein and in the Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Company and its Subsidiaries not defined in Section 1.1 and accounting terms
partly defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP; provided, that if a change in
GAAP occurs after the date hereof which materially affects (either favorably
or adversely) the ability of the Company to comply with any covenant contained
in Section 6, the Banks and the Company agree to renegotiate in good faith the
terms of such covenant.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, each Bank severally agrees to make revolving credit loans
(the "Loans") to the Company from time to time during the Commitment Period in
an aggregate principal amount at any one time outstanding not to exceed the
lesser of (i) such Bank's Commitment and (ii) such Bank's Commitment
Percentage of the aggregate Original Commitment. During the Commitment Period
the Company may use the Commitments by borrowing, prepaying the Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof.
(b) The Loans may from time to time be (i) Eurodollar Loans, (ii)
Base Rate Loans, (iii) C/D Rate Loans or (iv) a combination thereof, as
determined by the Company and notified to the Administrative Agent in
accordance with Sections 2.3 and 2.7; provided, that no Loan shall be made as
a Eurodollar Loan or a C/D Rate Loan after the day that is one month or 30
days, respectively, prior to the Termination Date.
<PAGE>21
2.2 Revolving Credit Notes. The Loans made by each Bank shall be
evidenced by a promissory note of the Company, substantially in the form of
Exhibit A, with appropriate insertions as to payee, date and principal amount
(a "Note"), payable to the order of such Bank and in a principal amount equal
to the lesser of (a) the amount of the initial Commitment of such Bank and (b)
the aggregate unpaid principal amount of all Loans made by such Bank. Each
Bank is hereby authorized to record the date, Type and amount of each Loan
made by such Bank, each continuation thereof, each conversion of all or a
portion thereof to another Type, the date and amount of each payment or
prepayment of principal thereof and, in the case of Eurodollar Loans and C/D
Rate Loans, the length of each Interest Period with respect thereto, on the
schedule annexed to and constituting a part of its Note, and any such
recordation shall constitute prima facie evidence of the accuracy of the
information so recorded; provided, that the failure of any Bank to make any
such recordation or any error in any such recordation shall not affect the
obligations of the Company hereunder or under such Note. Each Note shall (x)
be dated the Closing Date, (y) be stated to mature on the Termination Date and
(z) provide for the payment of interest in accordance with Section 2.9.
2.3 Procedure for Revolving Credit Borrowing. The Company may
borrow under the Commitments during the Commitment Period on any Eurodollar
Business Day, if all or any part of the requested Loans are to be initially
Eurodollar Loans, or on any Business Day, otherwise; provided, that the
Company shall give the Administrative Agent irrevocable notice (which notice
must be received by the Administrative Agent prior to 10:00 A.M., New York
City time, (a) with respect to any of the requested Loans that are to be
initially Eurodollar Loans, three Eurodollar Business Days prior to the
requested Borrowing Date, (b) with respect to any of the requested Loans that
are to be initially C/D Rate Loans, one Business Day prior to the requested
Borrowing Date, or (c) with respect to any of the requested Loans that are to
be initially Base Rate Loans, one Business Day prior to the requested
Borrowing Date; provided, that with respect to any of the requested Loans to
be made on the initial Borrowing Date as Base Rate Loans, notice for such
Loans may be given on such initial Borrowing Date), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing
is to be of Eurodollar Loans, Base Rate Loans, C/D Rate Loans or a combination
thereof and (iv) if the borrowing is to be entirely or partly of Eurodollar
Loans or C/D Rate Loans, the respective amounts of each such Loan and the
respective lengths of the initial Interest Periods therefor. Each borrowing
under the Commitments shall be in an amount equal to $10,000,000 or a whole
multiple of $1,000,000 in excess thereof or in the remaining amount of the
Available Commitments. Upon receipt of any such notice from the Company, the
Administrative Agent shall promptly notify each Bank thereof. Each Bank will
make the amount of its pro rata share of each borrowing available to the
<PAGE>22
Administrative Agent for the account of the Company at the office of the
Administrative Agent specified in Section 9.2 prior to 11:00 A.M., New York
City time, on the Borrowing Date requested by the Company in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Company by the Administrative Agent's crediting the account
of the Company on the books of such office with the aggregate of the amounts
made available to the Administrative Agent by the Banks and in like funds as
received by the Administrative Agent.
2.4 Fees. (a) Commitment Fee. The Company agrees to pay to the
Administrative Agent for the account of each Bank a commitment fee for the
period from and including the Closing Date, computed at the Commitment Fee
Rate on the average daily amount of the Unused Commitment of such Bank during
the period for which payment is made, payable quarterly in arrears on the last
day of each March, June, September and December and on the Termination Date,
commencing on the first of such dates to occur after the date hereof.
(b) Upfront Fee. The Company agrees to pay to the Administrative
Agent for the account of each Bank an upfront fee equal to the applicable
Upfront Fee Percentage of the Commitment of such Bank in effect on the Closing
Date, payable on the Closing Date. The "Upfront Fee Percentage" shall be
based on the initial commitment of such Bank for this Agreement, as expressed
in writing by such Bank to the Company (and before final allocation of the
Commitments), in accordance with the following table:
Initial Commitment Upfront
(Before Final Allocation) Fee Percentage
$29,000,000 or more 0.04%
$21,750,000 to $28,999,999 0.03%
$14,500,000 to $21,749,999 0.02%
$7,250,000 to $14,499,999 0.01%
Less than $7,250,000, if any 0%
(c) Other Fees. The Company agrees to pay to each Agent such other
fees as have been agreed to in writing by the Company and such Agent.
2.5 Termination or Reduction of Commitments. The Company shall
have the right, upon not less than three Business Days' notice to the Agent,
to terminate the Commitments or, from time to time, to reduce the amount of
the Commitments; provided, that no such termination or reduction shall be
permitted if, after giving effect thereto and to any payments or prepayments
of the Loans made on the effective date thereof, the aggregate principal
amount of the Loans then outstanding would exceed the aggregate Commitments
then in effect. Any such reduction shall be in an amount equal to $10,000,000
or a whole multiple of
<PAGE>23
$1,000,000 in excess thereof and shall reduce permanently the Commitments then
in effect.
2.6 Prepayments. (a) The Company may at any time and from time to
time prepay the Loans, in whole or in part, without premium or penalty, upon
at least three Business Days' irrevocable notice to the Administrative Agent
in the case of Base Rate Loans and C/D Rate Loans and at least three
Eurodollar Business Days' irrevocable notice to the Administrative Agent in
the case of Eurodollar Loans, which notice shall specify the date and amount
of prepayment and whether the prepayment is of Eurodollar Loans, Base Rate
Loans, C/D Rate Loans or a combination thereof, and, if of a combination
thereof, the amount allocable to each. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Bank thereof. If any such
notice is given, the amount specified in such notice shall be due and payable
on the date specified therein, together with accrued interest to such date on
the amount prepaid. Partial prepayments shall be in an aggregate principal
amount of $10,000,000 or a whole multiple of $1,000,000 in excess thereof.
Each prepayment of Eurodollar Loans and C/D Rate Loans shall be subject to
compliance with the provisions of Sections 2.8 and 2.16.
(b) If at any time the principal amount of Loans then outstanding
shall exceed the Commitments, the Company shall immediately prepay or at its
option cash collateralize the Loans as provided in Section 2.6(c) in an amount
equal to such excess. Amounts payable pursuant to this Section 2.6(b) shall
be applied, first, to prepay any Base Rate Loans then outstanding and second,
to prepay or cash collateralize (at the Company's option) any Eurodollar Loans
or C/D Rate Loans then outstanding (provided, that any Eurodollar Loans or C/D
Rate Loans so cash collateralized shall be prepaid no later than the last day
of the respective Interest Periods therefor). Each prepayment pursuant to
this Section 2.6(b) shall be accompanied by accrued interest on the amount
prepaid and, in the case of prepayments of Eurodollar Loans, any amounts
payable pursuant to Section 2.16.
(c) The Company shall cash collateralize Eurodollar Loans or C/D
Rate Loans pursuant to Section 2.6(b) by depositing in an account with the
Administrative Agent (the "Cash Collateral Account"), to be established and
maintained pursuant to such terms and conditions as shall be specified by the
Administrative Agent in its discretion, an amount determined pursuant to the
second sentence of Section 2.6(b) with respect to Eurodollar Loans or C/D Rate
Loans, as the case may be. Such deposited monies shall be held by the
Administrative Agent as cash collateral (the "Cash Collateral") for the
outstanding Eurodollar Loans or C/D Rate Loans, as the case may be, on a pro
rata basis; provided, that if any Base Rate Loans shall be made while there is
Cash Collateral on deposit in the Cash Collateral Account, the Administrative
Agent shall apply such Cash Collateral to the immediate prepayment of such
Base Rate Loans and only the Cash
<PAGE>24
Collateral remaining after such prepayment, if any, shall be retained in the
Cash Collateral Account. The Cash Collateral Account and the Cash Collateral
shall be subject to the sole dominion and control of the Administrative Agent
and, except as set forth above, the Cash Collateral shall be retained in the
Cash Collateral Account until the repayment of Eurodollar Loans or C/D Rate
Loans, as the case may be, in an amount equal to the amount of the Cash
Collateral deposited therein. Upon any such repayment, an amount equal to the
amount of such repayment shall be transferred from the Cash Collateral Account
to the Company. The Administrative Agent shall invest the Cash Collateral in
Cash Equivalents, and shall pay over to the Company any interest earned on
such investments quarterly on the last day of each March, June, September and
December; provided, that no Default or Event of Default shall have occurred
and be continuing (in which case such interest shall be retained as Cash
Collateral). The Administrative Agent shall not be liable for any losses or
decreases in value with respect to the Cash Collateral, other than those
occurring as a result of its gross negligence or willful misconduct.
2.7 Conversion and Continuation Options. (a) The Company may
elect from time to time to convert Eurodollar Loans or C/D Rate Loans to Base
Rate Loans, and/or to convert Eurodollar Loans or Base Rate Loans to C/D Rate
Loans, by giving the Administrative Agent at least two Business Days' prior
irrevocable notice of such election; provided, that any such conversion of
Eurodollar Loans or C/D Rate Loans may only be made on the last day of an
Interest Period with respect thereto. The Company may elect from time to time
to convert Base Rate Loans or C/D Rate Loans to Eurodollar Loans by giving the
Agent at least three Eurodollar Business Days' prior irrevocable notice of
such election; provided, that any such conversion of C/D Rate Loans may,
subject to the third succeeding sentence, only be made on the last day of an
Interest Period with respect thereto. Any such notice of conversion to
Eurodollar Loans or C/D Rate Loans shall specify the length of the initial
Interest Period or Interest Periods therefor. Upon receipt of any such notice
the Agent shall promptly notify each Bank thereof. If the last day of the
then current Interest Period with respect to C/D Rate Loans that are to be
converted to Eurodollar Loans is not a Eurodollar Business Day, such
conversion shall be made on the next succeeding Eurodollar Business Day, and
during the period from such last day to such succeeding Eurodollar Business
Day such Loans shall bear interest as if they were Base Rate Loans. All or
any part of outstanding Eurodollar Loans, Base Rate Loans and C/D Rate Loans
may be converted as provided herein; provided, that (i) no Loan may be
converted into a Eurodollar Loan or a C/D Rate Loan when any Event of Default
(upon notice from the Administration Agent, on behalf of the Required Banks,
except such notice shall not be required in the case of the Event of Default
described in Section 7(f)) has occurred and is continuing, (ii) any such
conversion may only be made if, after giving effect thereto, Section 2.8 shall
not have been
<PAGE>25
contravened and (iii) no Loan may be converted into a Eurodollar Loan or a C/D
Rate Loan after the date that is one month or 30 days, respectively, prior to
the Termination Date.
(b) Any Eurodollar Loan or C/D Rate Loan may be continued as such
upon the expiration of the then current Interest Period with respect thereto
by the Company giving notice to the Administrative Agent, in accordance with
the applicable provisions of the term "Interest Period" set forth in Section
1.1, of the length of the next Interest Period to be applicable to such Loans;
provided, that no Eurodollar Loan or C/D Rate Loan may be continued as such
(i) when any Event of Default (upon notice from the Administration Agent, on
behalf of the Required Banks, except such notice shall not be required in the
case of the Event of Default described in Section 7(f)) has occurred and is
continuing, (ii) if, after giving effect thereto, Section 2.8 would be
contravened or (iii) after the date that is one month or 30 days,
respectively, prior to the Termination Date; provided further, that if the
Company shall fail to give any required notice as described above in this
paragraph or if such continuation is not permitted pursuant to the preceding
proviso such Loans shall be automatically converted to Base Rate Loans on the
last day of such then expiring Interest Period.
2.8 Minimum Amounts of Tranches. All borrowings, conversions and
continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, the aggregate principal amount of the Loans
comprising (a) each Eurodollar Tranche shall be equal to $15,000,000 or a
whole multiple of $1,000,000 in excess thereof, (b) each C/D Rate Tranche
shall be equal to $15,000,000 or a whole multiple of $1,000,000 in excess
thereof and (c) there shall be no more than 12 different Tranches outstanding
at any one time.
2.9 Interest Rates and Payment Dates. (a) Each Eurodollar Loan
shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such
Interest Period plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin.
(c) Each C/D Rate Loan shall bear interest for each day during
each Interest Period with respect thereto at a rate per annum equal to the C/D
Rate determined for such day plus the Applicable Margin.
(d) If all or a portion of (i) the principal amount of any Loan,
(ii) any interest payable thereon or (iii) any fee or other amount payable
pursuant to this Agreement shall not be paid when due (whether at the stated
maturity, by acceleration or
<PAGE>26
otherwise), such overdue amount shall bear interest at a rate per annum which
is (x) in the case of overdue principal, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section 2.9
plus 2%, (y) in the case of overdue interest (to the extent permitted by
applicable law) or fees, the rate described in paragraph (b) of this Section
2.9 plus 2% or (z) in the case of other amounts payable pursuant to this
Agreement, the then applicable Base Rate, in each case from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).
(e) Interest shall be payable in arrears on each Interest Payment
Date; provided, that interest accruing pursuant to paragraph (d) of this
Section 2.9 shall be payable on demand, or, in the absence of demand, weekly
on Friday of each week.
2.10 Computation of Interest and Fees. (a) Interest on Loans and
fees shall be calculated on the basis of a 360-day year for the actual days
elapsed; provided, that interest on Base Rate Loans computed with reference to
the Administrative Agent's reference rate shall be calculated on the basis of
a 365- (or 366-, as the case may be) day year for the actual days elapsed.
The Administrative Agent shall as soon as practicable notify in writing the
Company and the Banks of each determination of a Eurodollar Rate or of a C/D
Rate. Any change in the interest rate on a Loan resulting from a change in
the Ratings, the Base Rate, the C/D Assessment Rate or the C/D Reserve
Percentage and any change in the commitment fee pursuant to Section 2.4(a)
resulting from a change in the Commitment Fee Rate shall become effective as
of the opening of business on the day on which such change becomes effective.
The Administrative Agent shall as soon as practicable notify in writing the
Company and the Banks of the effective date and the amount of each such change
in interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Company and the Banks in the absence of manifest error. The
Administrative Agent shall, at the request of the Company or a Bank, deliver
to the Company or such Bank, as the case may be, a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to Section 2.9(a) or (c).
(c) If any Reference Bank's Commitment shall terminate or all its
Loans shall be assigned for any reason whatsoever or such Reference Bank shall
fail on two consecutive times to furnish quotations of the rate to the
Administrative Agent pursuant to Section 2.10(d), such Reference Bank shall
thereupon cease to be a Reference Bank, and if, as a result of the foregoing,
there shall only be one Reference Bank remaining, the Administrative Agent
(after consultation with the Company and the Banks) shall, by notice to the
Company and the Banks, designate
<PAGE>27
another Bank as a Reference Bank so that there shall at all times be at least
two Reference Banks.
(d) Each Reference Bank shall use its best efforts to furnish
quotations of rates to the Administrative Agent as contemplated hereby. If
any of the Reference Banks shall be unable or shall otherwise fail to supply
such rates to the Administrative Agent upon its request, the rate of interest
shall, subject to the provisions of Section 2.11, be determined on the basis
of the quotations of the remaining Reference Banks or Reference Bank.
2.11 Inability to Determine Interest Rate. In the event that prior
to the first day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Company) that, by
reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate or the
C/D Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the
Required Banks that the Eurodollar Rate or the C/D Rate determined or to
be determined for such Interest Period will not adequately and fairly
reflect the cost to such Banks (as conclusively certified in writing by
such Banks) of making or maintaining their affected Loans during such
Interest Period,
the Administrative Agent shall give telecopy or telephonic notice (confirmed
in writing) thereof to the Company and the Banks as soon as practicable
thereafter. If such notice is given (x) any Eurodollar Loans or C/D Rate
Loans, as the case may be, requested to be made on the first day of such
Interest Period shall be made as Base Rate Loans, (y) any Loans that were to
have been converted on the first day of such Interest Period to Eurodollar
Loans or C/D Rate Loans, as the case may be, shall be converted to or
continued as Base Rate Loans and (z) any outstanding Eurodollar Loans or C/D
Rate Loans, as the case may be, shall be converted, on the first day of such
Interest Period, to Base Rate Loans. The Administrative Agent shall promptly
notify the Company at such time as the conditions set forth in (a) and (b)
above are no longer in effect, and until such notice has been delivered by the
Administrative Agent, no further Eurodollar Loans or C/D Rate Loans shall be
made or continued as such, nor shall the Company have the right to convert
Loans to Eurodollar Loans or C/D Rate Loans, as the case may be.
2.12 Pro Rata Treatment and Payments. (a) Each borrowing by the
Company from the Banks of Loans, each payment by the Company on account of any
commitment fee or upfront fee hereunder and any reduction of the Commitments
of the Banks shall be made pro rata according to the respective Commitment
<PAGE>28
Percentages of the Banks. Each payment (including each prepayment) by the
Company on account of principal of and interest on the Loans shall be made pro
rata according to the respective outstanding principal amounts of the Loans
then held by the Banks. All payments (including prepayments) to be made by
the Company hereunder and under the Notes, whether on account of principal,
interest, fees or otherwise, shall be made without set-off or counterclaim and
shall be made prior to 12:00 Noon, New York City time, on the due date thereof
to the Administrative Agent, for the account of the Banks, at the
Administrative Agent's office specified in Section 9.2, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Banks promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the Eurodollar Loans) becomes due
and payable on a day other than a Business Day, such payment shall be extended
to the next succeeding Business Day, and, with respect to payments of
principal, interest thereon shall be payable at the then applicable rate
during such extension. If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Eurodollar Business Day, the maturity thereof
shall be extended to the next succeeding Eurodollar Business Day unless the
result of such extension would be to extend such payment into another calendar
month, in which event such payment shall be made on the immediately preceding
Eurodollar Business Day.
(b) Unless the Administrative Agent shall have been notified in
writing by any Bank prior to a Borrowing Date that such Bank will not make the
amount that would constitute its portion of the borrowing to be made on such
date available to the Administrative Agent, the Administrative Agent may
assume that such Bank has made such amount available to the Administrative
Agent on such Borrowing Date, and the Administrative Agent may, in reliance
upon such assumption, make available to the Company a corresponding amount.
If such amount is made available to the Administrative Agent on a date after
such Borrowing Date, such Bank shall pay to the Administrative Agent on demand
an amount equal to the product of (i) the daily average Federal funds rate
during such period as quoted by the Administrative Agent, times (ii) the
amount of such Bank's portion of such borrowing, times (iii) a fraction the
numerator of which is the number of days that elapse from and including such
Borrowing Date to the date on which such Bank's portion of such borrowing
shall have become immediately available to the Administrative Agent and the
denominator of which is 360. A certificate of the Administrative Agent
submitted to any Bank with respect to any amounts owing under this Section
2.12(b) shall be conclusive in the absence of manifest error. If such Bank's
portion of such borrowing is not in fact made available to the Administrative
Agent by such Bank within three Business Days of such Borrowing Date, the
Administrative Agent shall be entitled to recover such amount with interest
thereon at the rate per annum applicable to Base Rate Loans hereunder, on
demand, from the Company. If the Company returns to the Administrative Agent
any amount with
<PAGE>29
interest thereon as described in the immediately preceding sentence, such Bank
shall indemnify the Company for the difference, if any, between (i) the
aggregate interest paid by the Company to the Administrative Agent in
accordance with the immediately preceding sentence less (ii) the aggregate
interest which actually accrued on such amount prior to its return to the
Administrative Agent.
2.13 Illegality. Notwithstanding any other provision herein, if
any change in any Requirement of Law or in the interpretation or application
thereof shall make it unlawful for any Bank to make or maintain Eurodollar
Loans as contemplated by this Agreement, (a) the commitment of such Bank
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Domestic Dollar Loans to Eurodollar Loans shall forthwith be cancelled
and (b) such Bank's Loans then outstanding as Eurodollar Loans, if any, shall
be converted automatically to Base Rate Loans on the respective last days of
the then current Interest Periods with respect to such Loans or within such
earlier period as required by law. If any such conversion of a Eurodollar
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Company shall pay to such Bank such amounts,
if any, as may be required pursuant to Section 2.16.
2.14 Other Costs; Increased Costs. (a) The Company agrees to pay
to each Bank which requests compensation under this Section 2.14(a) (by
written notice to the Company), on the last day of each Interest Period with
respect to any Eurodollar Loan made by such Bank, so long as such Bank shall
be required to maintain reserves against "Eurocurrency liabilities" under
Regulation D of the Board of Governors of the Federal Reserve System (or, so
long as such Bank may be required by such Board of Governors or by any other
Governmental Authority to maintain reserves against any category of
liabilities which includes deposits by reference to which the interest rate on
Eurodollar Loans is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Bank which includes
any Eurodollar Loans), an additional amount (determined by such Bank and
notified to the Company) representing such Bank's calculation or, if an
accurate calculation is impracticable, reasonable estimate (using such
reasonable means of allocation as such Bank shall determine) of the actual
costs, if any, incurred by such Bank while such Eurodollar Loans were
outstanding as a result of the applicability of the foregoing reserves to such
Eurodollar Loans, which amount in any event shall not exceed the product of
the following for each day while such Eurodollar Loans were outstanding:
(i) the principal amount of the relevant Eurodollar Loans made by
such Bank outstanding on such day; and
<PAGE>30
(ii) the difference between (x) a fraction the numerator of which is
the Eurodollar Rate (expressed as a decimal) applicable to such
Eurodollar Loans, and the denominator of which is one minus the maximum
rate (expressed as a decimal) at which such reserve requirements are
imposed by such Board of Governors or other Governmental Authority on
such date minus (y) such numerator; and
(iii) a fraction the numerator of which is one and the denominator of
which is 360.
(b) In the event that any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Bank with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject any Bank to any tax of any kind whatsoever with
respect to this Agreement, any Note or any Eurodollar Loan or C/D Rate
Loan made by it, or change the basis of taxation of payments to such Bank
in respect thereof (except for taxes covered by Section 2.15 and changes
in the rate of tax on the overall net income of such Bank);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by,
any office of such Bank which is not otherwise described in Section
2.14(a) or otherwise included in the determination of the C/D Rate; or
(iii) shall impose on such Bank any other condition;
and the result of any of the foregoing is to increase the cost to such Bank,
by an amount which such Bank deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or C/D Rate Loans or to reduce any
amount receivable hereunder in respect thereof, then, in any such case, the
Company shall pay such Bank within 15 Business Days following demand therefor
any additional amounts necessary to compensate such Bank for such increased
cost or reduced amount receivable. If any Bank becomes entitled to claim any
additional amounts pursuant to this Section 2.14(b), it shall promptly notify
the Company, through the Administrative Agent, of the event by reason of which
it has become so entitled.
(c) In the event that any Bank shall have determined that any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Bank or any
corporation controlling such Bank with any request or directive regarding
capital adequacy (whether
<PAGE>31
or not having the force of law) from any Governmental Authority made
subsequent to the date hereof does or shall have the effect of reducing the
rate of return on such Bank's or such corporation's capital as a consequence
of its obligations hereunder to a level below that which such Bank or such
corporation could have achieved but for such change or compliance (taking into
consideration such Bank's or such corporation's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, after submission by such Bank to the Company (with a copy to the
Administrative Agent) of a written request therefor, the Company shall pay to
such Bank within 15 Business Days following demand therefor such additional
amount or amounts as will compensate such Bank for such reduction.
(d) A certificate as to any additional amounts payable pursuant to
this Section 2.14 submitted by the relevant Bank, through the Administrative
Agent, to the Company shall be conclusive in the absence of manifest error.
The covenants contained in this Section 2.14 shall survive the termination of
this Agreement and the payment of the Notes and all other amounts payable
hereunder. Any notice to be given by a Bank under this Section 2.14 after
termination of this Agreement shall be effective only if given within 120 days
after such Bank becomes aware or should have become aware of the events giving
rise to such notice.
2.15 Taxes. (a) All payments made by the Company under this
Agreement and the Notes shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding, in the case of each Agent and each Bank,
(i) net income taxes, franchise and branch profit taxes (imposed in lieu of
net income taxes) imposed on such Agent or such Bank, as the case may be, as a
result of a present or former connection between the jurisdiction of the
government or taxing authority imposing such tax and such Agent or such Bank
(excluding a connection arising solely from such Agent or such Bank having
executed, delivered or performed its obligations or received a payment under,
or enforced, this Agreement or the Notes) or any political subdivision or
taxing authority thereof or therein and (ii) any taxes, levies, imposts,
duties, charges, fees, deductions or withholdings arising after the Closing
Date, solely as a result of or attributable to such Agent or Bank (x) changing
its designated lending office as of the Closing Date to a lending office
located in any other jurisdiction or (y) designating an additional lending
office located in any other jurisdiction (all such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions and withholdings being hereinafter
called "Taxes"). If any Taxes are required to be withheld from any amounts
payable to any Agent or any Bank hereunder or under the Notes, the amounts so
payable to such
<PAGE>32
Agent or such Bank shall be increased to the extent necessary to yield to such
Agent or such Bank (after payment of all Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement and the Notes. Whenever any Taxes are payable by the Company, as
promptly as possible thereafter the Company shall send to the Administrative
Agent for its own account or for the account of such Agent or Bank, as the
case may be, a copy of any original official receipt that may be received by
the Company showing payment thereof. If the Company fails to pay any Taxes
when due to the appropriate taxing authority or fails to remit to the
Administrative Agent the receipts that may be received or other available
documentary evidence, the Company shall indemnify the Agents and the Banks for
any incremental taxes, interest or penalties that may become payable by any
Agent or any Bank to the United States or other Governmental Authority as a
result of any such failure. The agreements in this Section 2.15(a) shall
survive the termination of this Agreement and the payment of the Notes and all
other amounts payable hereunder. If any Taxes constituting a withholding tax
of the United States of America or any other Governmental Authority shall be
or become applicable, after the Closing Date, to such payments by the Company
to an Agent or Bank, such Agent or Bank shall use its best efforts to make,
fund and maintain its Loans through another lending office of such Agent or
Bank in another jurisdiction so as to reduce, to the fullest extent possible,
the Company's liability hereunder, if the making, funding or maintenance of
such Loans through such other office does not otherwise materially adversely
affect such Loans or such Agent or Bank.
(b) Prior to the first Interest Payment Date, each Bank that is not
incorporated under the laws of the United States of America or a state thereof
agrees that it will deliver to the Company and the Administrative Agent (i)
two duly completed copies of United States Internal Revenue Service Form 1001
or 4224 or successor applicable form, as the case may be, and (ii) an Internal
Revenue Service Form W-8 or W-9 or successor applicable form. Each such Bank
also agrees to deliver to the Company and the Administrative Agent two further
copies of the said Form 1001 or 4224 and Form W-8 or W-9, or successor
applicable forms or other manner of certification, as the case may be, on or
before the date that any such form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent form previously
delivered by it to the Company, and such extensions or renewals thereof as may
reasonably be requested by the Company or the Administrative Agent, unless in
any such case an event (including, without limitation, any change in treaty,
law or regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable or which
would prevent such Bank from duly completing and delivering any such form with
respect to it and such Bank so advises the Company and the Administrative
Agent. Such Bank shall certify (i) in the case of a Form 1001 or 4224, that
it is entitled to receive
<PAGE>33
payments under this Agreement without deduction or withholding of any United
States federal income taxes and (ii) in the case of a Form W-8 or W-9, that it
is entitled to an exemption from United States backup withholding tax. The
Company shall not be required to pay any increased amount on account of Taxes
pursuant to this Section 2.15 to an Agent or Bank that fails to furnish any
form or statement that it is required to furnish in accordance with this
Section 2.15(b) and, to the extent required by law, the Company shall be
entitled to deduct Taxes from the payments owed to such Bank or Agent. In the
event that the Company is required to pay any Bank any additional amount or
indemnify any Bank pursuant to Section 2.15(a) and no change in lending office
is made in accordance with the last sentence of Section 2.15(a), after the
Company makes such payment, such Bank shall transfer, in accordance with the
procedures set forth in Section 9.6(c), its Loans and Commitment to a Bank
selected by the Company with the approval of such transferor Bank and the
Administrative Agent (not to be unreasonably withheld).
2.16 Indemnity. The Company agrees to indemnify each Bank and to
hold each Bank harmless from any loss or expense which such Bank may sustain
or incur as a consequence of (a) default by the Company in payment when due of
the principal amount of or interest on any Eurodollar Loan or C/D Rate Loan,
(b) default by the Company in making a borrowing of, conversion into or
continuation of Eurodollar Loans or C/D Rate Loans after the Company has given
a notice requesting the same in accordance with the provisions of this
Agreement, (c) default by the Company in making any prepayment after the
Company has given a notice thereof in accordance with the provisions of this
Agreement, (d) the making of a voluntary or involuntary prepayment of
Eurodollar Loans or C/D Rate Loans on a day which is not the last day of an
Interest Period with respect thereto or (e) the conversion of Eurodollar Loans
to Domestic Dollar Loans pursuant to Section 2.11 or 2.13 on a day which is
not the last day of the Interest Period with respect thereto, including,
without limitation, in each case, any such loss or expense arising from the
reemployment of funds obtained by it or from fees payable to terminate the
deposits from which such funds were obtained. A certificate setting forth the
computation of any amount payable pursuant to the foregoing sentence submitted
by a Bank, through the Administrative Agent, to the Company shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Notes and all other
amounts payable hereunder.
2.17 Purpose. The proceeds of the Loans shall be used by the
Company solely for general corporate purposes, including acquisitions
(including the acquisition of Federal Systems).
<PAGE>34
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Agreement and to
make the Loans herein provided for, the Company hereby represents and warrants
to each Agent and to each Bank that:
3.1 Financial Condition. (a) The consolidated balance sheet of
the Company and its Subsidiaries as at March 31, 1993 and the related
consolidated statements of income and retained earnings and of cash flows for
the fiscal year ended on such date, reported on by Coopers & Lybrand and (b)
the unaudited consolidated balance sheets of the Company and its Subsidiaries
as at December 31, 1993 and the related unaudited consolidated statements of
income and retained earnings and of cash flows for the fiscal quarter ended on
such date, copies of which have heretofore been furnished to each Bank, are
complete and correct in all material respects and present fairly (except, with
respect to interim reports, for normal year-end adjustments) the consolidated
financial condition of the Company and its Subsidiaries as at such date, and
the consolidated results of their operations and cash flows for the fiscal
period then ended. All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP
applied consistently throughout the periods involved (except as approved by
such accountants and as disclosed therein). Except as disclosed on Schedule
3.1 hereto, such audited financial statements, taken together, disclose, in
accordance with GAAP, all material contingent liabilities and liability for
taxes, long-term leases and unusual forward or long-term commitments of the
Company and its Subsidiaries.
3.2 No Change. Since March 31, 1993 (a) there has been no change
in the business, operations, property or financial or other condition of the
Company or any of its Subsidiaries which has or could reasonably be expected
to have a Material Adverse Effect and (b) no dividends or other distributions
have been declared, paid or made upon any shares of capital stock of the
Company nor have any shares of capital stock of the Company been redeemed,
retired, purchased or otherwise acquired for value by the Company or any of
the Subsidiaries except as permitted by Section 6.5.
3.3 Corporate Existence; Compliance with Law. Each of the Company
and the Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate power and authority and the legal right to
own and operate its property, to lease the property it operates as lessee and
to conduct the business in which it is currently engaged, (c) is duly
qualified as a foreign corporation and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, except to the extent that
the failure to be
<PAGE>35
so qualified could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect, and (d) is in compliance with all Requirements of Law
except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
3.4 Corporate Power; Authorization; Enforceable Obligations. The
Company has the corporate power and authority and the legal right to make,
deliver and perform this Agreement and the Notes and to borrow hereunder and
has taken all necessary corporate action to authorize the borrowings on the
terms and conditions of this Agreement and the Notes and to authorize the
execution, delivery and performance of this Agreement and the Notes. No
consent or authorization of, filing with or other act by or in respect of any
Governmental Authority is required in connection with the borrowings hereunder
or with the execution, delivery, performance, validity or enforceability of
this Agreement and the Notes, other than those which have been obtained or
made and are in full force and effect. This Agreement has been, and each Note
will be, duly executed and delivered on behalf of the Company. This Agreement
constitutes, and each Note when executed and delivered will constitute, a
legal, valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity
or at law).
3.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the Notes by the Company, the borrowings hereunder and the use
of the proceeds thereof, will not violate any Requirement of Law or any
Contractual Obligation applicable to the Company or of any of the
Subsidiaries, and will not result in, or require, the creation or imposition
of any Lien on any of its or their respective properties or revenues pursuant
to any Requirement of Law or Contractual Obligation.
3.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending
or, to the knowledge of the Company, threatened by or against the Company or
any of the Subsidiaries or against any of its or their respective properties
or revenues (a) with respect to this Agreement and the Notes or any of the
transactions contemplated hereby, or (b) which could reasonably be expected to
have a Material Adverse Effect, excluding litigation described in the
Company's Form 10-K for the fiscal year ended March 31, 1993 filed with the
Securities and Exchange Commission (but not excluding developments with
respect thereto occurring after March 31, 1993 not described in such Form 10-
K).
<PAGE>36
3.7 No Default. Neither the Company nor any of the Subsidiaries is
in default under or with respect to any Contractual Obligation in any respect
which could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.
3.8 Ownership of Property; Liens. Each of the Company and the
Subsidiaries has good record and marketable title in fee simple to or valid
leasehold interests in all its real property, and good title to all its other
property, and none of such property is subject to any Lien, except as
permitted in Section 6.3 and except where the failure to have such title could
not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.
3.9 Taxes. Each of the Company and the Subsidiaries has filed or
caused to be filed all tax returns which to the knowledge of the Company are
required to be filed and has paid all taxes shown to be due and payable on
said returns or on any assessments made against it or any of its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority (other than those the amount or validity of which
is currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Company or the Subsidiaries, as the case may be, and other than
those the non-payment of which could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect); and no federal income tax liens
have been filed and, to the knowledge of the Company, no claims are being
asserted with respect to any such taxes, fees or other charges, except any
such claims which could not reasonably be expected to have a Material Adverse
Effect.
3.10 Federal Regulations. No part of the proceeds of any Loans
hereunder will be used for the purpose of "purchasing" or "carrying" any
"margin stock" within the respective meanings of each of the quoted terms
under Regulation U of the Board of Governors of the Federal Reserve System as
now and from time to time hereafter in effect or for any purpose which
violates the provisions of the Regulations of such Board of Governors. If
requested by any Bank or the Administrative Agent, the Company will furnish to
the Administrative Agent and each Bank a statement to the foregoing effect in
conformity with the requirements of Federal Reserve Form U-1 referred to in
said Regulation U.
3.11 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which
this representation is made or deemed made with respect to any Plan which has
resulted or could reasonably be expected to result in a liability to the
Company or any Substantial Subsidiary in excess of
<PAGE>37
$2,000,000, and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code. No termination of a Single
Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. The present value of all accrued
benefits under each Single Employer Plan (based on those assumptions used to
fund such Plans) did not, as of the last annual valuation date prior to the
date on which this representation is made or deemed made, exceed, by more than
$35,000,000, the value of the assets of such Plan allocable to such accrued
benefits; provided, however, that with respect to the defined benefit pension
plan to be established by Federal Systems, such amount shall be $50,000,000
rather than $35,000,000. Neither the Company nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any Multiemployer Plan,
and neither the Company nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Company or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as
of the valuation date most closely preceding the date on which this
representation is made or deemed made, where such liability could, in the
aggregate, reasonably be expected to have a Material Adverse Effect. No such
Multiemployer Plan is in Reorganization or Insolvent.
3.12 Investment Company Act; Other Regulations. The Company is not
an "investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. The
Company is not subject to regulation under any Federal or State statute or
regulation which limits its ability to incur Indebtedness.
3.13 Subsidiaries. Except as disclosed on Schedule 3.13, the
Subsidiaries listed in the Company's annual report on Form 10-K for its fiscal
year ended March 31, 1993 constitute all of the Subsidiaries of the Company on
the Effective Date.
3.14 Environmental Matters. Each of the representations and
warranties set forth in paragraphs (a) through (e) of this Section 3.14 is
true and correct with respect to each parcel of real property owned or
operated by the Company or any Subsidiary (the "Properties"), except to the
extent that (i) the facts and circumstances giving rise to any such failure to
be so true and correct could not reasonably be expected to have a Material
Adverse Effect or (ii) the Company and the Subsidiaries are fully indemnified
against any liabilities which may result from any such failure to be so true
and correct:
(a) The Properties do not contain, and have not previously
contained, in, on, or under, including, without limitation, the soil and
groundwater thereunder, any Hazardous Materials in concentrations which
violate Environmental Laws.
<PAGE>38
(b) The Properties and all operations and facilities at the
Properties are in compliance with all Environmental Laws, and there is no
Hazardous Materials contamination or violation of any Environmental Law
which could interfere with the continued operation of any of the
Properties or impair the fair saleable value of any thereof.
(c) Neither the Company nor any of the Subsidiaries has received
any written complaint, notice of violation, alleged violation,
investigation or advisory action or of potential liability or of
potential responsibility regarding environmental protection matters or
permit compliance with regard to the Properties, nor is the Company aware
that any Governmental Authority is threatening to deliver to the Company
or any of the Subsidiaries any such notice.
(d) Hazardous Materials have not been generated, treated, stored,
disposed of, at, on or under any of the Properties, nor have any
Hazardous Materials been transferred from the Properties to any other
location in violation of any Environmental Law.
(e) There are no governmental, administrative actions or judicial
proceedings pending or (to the knowledge of the Company) contemplated
under any Environmental Laws to which the Company or any of the
Subsidiaries is or (to the knowledge of the Company) will be named as a
party with respect to the Properties, nor are there any consent decrees
or other decrees, consent orders, administrative orders or other orders,
or other administrative or judicial requirements outstanding under any
Environmental Law with respect to any of the Properties.
3.15 Full Disclosure. All information heretofore furnished by the
Company to any Agent or any Bank for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all such information
hereafter furnished by the Company to any Agent or any Bank will be, true and
accurate in all material respects on the date as of which such information is
stated or certified. The Company has disclosed to the Banks in writing any
and all facts which could reasonably be expected to have a Material Adverse
Effect.
SECTION 4 CONDITIONS PRECEDENT
4.1 Conditions of Initial Loans. The obligation of each Bank to
make its initial Loan hereunder is subject to the satisfaction of the
following conditions precedent:
(a) Agreement and Notes. The Documentation Agent shall have
received (i) counterparts of this Agreement duly executed and delivered
by the Company, each Agent and each Bank and (ii) for the account of each
Bank a Note conforming
<PAGE>39
to the requirements hereof and executed by a duly authorized officer of
the Company.
(b) Legal Opinions. The Documentation Agent shall have received,
with a photocopy counterpart for each Bank, (i) an opinion of Willkie
Farr & Gallagher, counsel to the Company, dated the Closing Date and
addressed to the Agents and the Banks, substantially in the form of
Exhibit B-1, (ii) an opinion of Eric J. Zahler, Esq., General Counsel of
the Company, dated the Closing Date and addressed to the Agents and the
Banks, substantially in the form of Exhibit B-2, and given on the express
instructions of the Company and (iii) an opinion of Simpson Thacher &
Bartlett, counsel to the Agents and the Banks, dated the Closing Date and
addressed to the Agents and the Banks, in form and substance satisfactory
to the Agents.
(c) Closing Certificate. The Documentation Agent shall have
received, with a photocopy counterpart for each Bank, a Closing
Certificate of the Company, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments,
satisfactory in form and substance to the Documentation Agent and its
counsel, executed by the President or any Vice President and the
Secretary or any Assistant Secretary of the Company.
(d) No Proceeding or Litigation; No Injunctive Relief. No action,
suit or proceeding before any arbitrator or any Governmental Authority
shall have been commenced, no investigation by any Governmental Authority
shall have been commenced, no action, suit, proceeding or investigation
by any Governmental Authority shall have been threatened and no
Requirement of Law shall have been enacted or proposed, in each case as
of the Closing Date (i) seeking to restrain, prevent or change the
transactions contemplated by this Agreement in whole or in part or
questioning the validity or legality of the transactions contemplated by
this Agreement or seeking damages in connection with such transactions or
(ii) which could reasonably be expected to have a Material Adverse
Effect.
(e) Consents, Licenses, Approvals, etc. The Documentation Agent
shall have received true copies (certified to be such by the President or
any Vice President of the Company or other appropriate party) of all
consents, licenses and approvals required as of the Closing Date in
accordance with applicable law in connection with the execution,
delivery, performance, validity and enforceability of this Agreement and
the Notes, if the failure to obtain such consents, licenses or approvals,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
<PAGE>40
(f) Audited Financial Statements. The Documentation Agent shall
have received, with a copy for each Bank, the audited financial
statements described in Section 3.1(a), which financial statements shall
be in form and substance satisfactory to the Banks as of the Closing Date
and shall have been reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope of
the audit.
(g) Unaudited Financial Statements. The Documentation Agent shall
have received, with a copy for each Bank, the unaudited consolidated
financial statements of the Company described in Section 3.1(b), which
financial statements shall be in form and substance satisfactory to the
Banks as of the Closing Date.
(h) Indebtedness; Restrictions. The terms and conditions of any
Indebtedness and Contingent Obligations (including, without limitation,
maturities, interest rates, prepayment and redemption requirements,
covenants, defaults, remedies, security provisions and subordination
provisions) of the Company or any of the Subsidiaries to remain
outstanding after the Closing Date shall be satisfactory to the Banks in
all respects as of the Closing Date, and the Banks shall be satisfied as
of the Closing Date that the Company and its Subsidiaries are not subject
to contractual or other restrictions that would be violated by this
Agreement or the transactions contemplated hereby.
(i) New Developments. As of the Closing Date there shall not have
occurred any change, or development or event involving a prospective
change, which in either case in the opinion of the Banks could reasonably
be expected to have a Material Adverse Effect.
(j) Undisclosed Information. As of the Closing Date the Banks
shall not have become aware of any previously undisclosed materially
adverse information with respect to (i) the business, operations,
properties, condition (financial or otherwise) or prospects of the
Company and its Subsidiaries taken as a whole, (ii) the ability of the
Company to perform its obligations under this Agreement or the Notes or
(iii) the rights or remedies of the Agents or the Banks hereunder or
thereunder.
(k) Fees. The Agents and the Banks shall have received all fees
and expenses required to be paid on or before the Closing Date.
(l) Representations and Warranties. Each of the representations
and warranties made by the Company in or pursuant to this Agreement shall
be true and correct on and as of the Closing Date as if made on and as of
such date.
<PAGE>41
(m) No Default. No Default or Event of Default shall have occurred
and be continuing on the Closing Date or after giving effect to the Loans
requested to be made on such date, if any.
(n) Cancellation of Existing Revolving Credit Agreement. The
Revolving Credit Agreement dated as of December 2, 1992, as amended,
among the Company, the financial institutions parties thereto, Morgan, as
documentation agent, Chemical, as administrative agent, Barclays, as
agent, and Continental, as co-agent, shall have been cancelled and all
obligations thereunder shall have been discharged in full.
(o) Revolving Credit Agreement. The Revolving Credit Agreement
shall have become effective in accordance with Section 4 thereof.
(p) Additional Documents. The Documentation Agent shall have
received each additional document, instrument, legal opinion or item of
information reasonably requested by it on or prior to the Closing Date,
including, without limitation, a copy of any debt instrument, security
agreement or other material contract to which the Company or any
Subsidiary may then be a party.
(q) Additional Matters. All corporate and other proceedings and
all documents, instruments and other legal matters in connection with the
transactions contemplated by this Agreement shall be satisfactory in form
and substance to the Documentation Agent as of the Closing Date, and the
Documentation Agent shall have received such other documents and legal
opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably request on or prior
to the Closing Date.
4.2 Conditions to all Loans. The obligation of each Bank to make
any Loan to be made by it hereunder is subject to the satisfaction of the
following conditions precedent on the relevant Borrowing Date:
(a) Representations and Warranties. Each of the representations
and warranties made by the Company in or pursuant to this Agreement shall
be true and correct on and as of such date as if made on and as of such
date except to the extent they expressly relate to an earlier date.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
Loans requested to be made on such date.
Each borrowing by the Company hereunder shall constitute a representation and
warranty by the Company as of the date of such
<PAGE>42
borrowing that the conditions contained in this Section 4.2 have been
satisfied.
SECTION 5. AFFIRMATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, any Note remains outstanding and unpaid or any other amount is owing
to any Bank or any Agent hereunder, the Company shall and (except in the case
of delivery of financial information, reports and notices) shall cause each of
the Subsidiaries to:
5.1 Financial Statements. Furnish to each Bank:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Company, a copy of the consolidated
balance sheet of the Company and its consolidated Subsidiaries as at the
end of such year and the related consolidated statements of income and
retained earnings and of cash flows for such year, setting forth in each
case in comparative form the figures for the previous year, reported on
without a "going concern" or like qualification or exception, or
qualification arising out of the scope of the audit, by independent
certified public accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Company, the unaudited consolidated balance sheets of the
Company and its consolidated Subsidiaries as at the end of such quarter
and the related unaudited consolidated statements of income and retained
earnings and cash flows of the Company and its consolidated Subsidiaries
for such quarter (except as to statements of cash flow) and the portion
of the fiscal year through such date, setting forth in each case in
comparative form the figures for the previous periods which would be
required under Form 10-Q promulgated by the Securities and Exchange
Commission, certified by a Responsible Officer (subject to normal year-
end audit adjustments);
all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein (except as
approved by such accountants or officer, as the case may be, and disclosed
therein).
5.2 Certificates; Other Information. Furnish to each Bank:
(a) concurrently with the delivery of the financial statements
referred to in Section 5.1(a) above, a certificate of the independent
certified public accountants reporting on such
<PAGE>43
financial statements stating that in making the examination necessary therefor
no knowledge was obtained of any Default or Event of Default, except as
specified in such certificate;
(b) concurrently with the delivery of the financial statements
referred to in Sections 5.1(a) and (b) above, a certificate of a Responsible
Officer (i) stating that, to the best of such officer's knowledge, the Company
during such period has observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in this Agreement and in
the Notes to be observed, performed or satisfied by it, and that such officer
has obtained no knowledge of any Default or Event of Default except as
specified in such certificate, and (ii) showing in detail the calculations
supporting such statement in respect of Sections 6.1, 6.2, and 6.5;
(c) within five days after the same are sent, copies of all
financial statements and reports which the Company sends to its stockholders,
and within five days after the same are filed, copies of all financial
statements and reports which the Company may make to, or file with, the
Securities and Exchange Commission or any successor or analogous Governmental
Authority; and
(d) promptly, such additional financial and other information as
any Bank may from time to time reasonably request.
5.3 Payment of Obligations. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all
its material obligations of whatever nature (other than Indebtedness and
Contingent Obligations, which shall be beyond the scope of this Section 5.3),
except when the amount or validity thereof is currently being contested in
good faith by appropriate proceedings and reserves in conformity with GAAP
with respect thereto have been provided on the books of the Company or its
Subsidiaries, as the case may be.
5.4 Conduct of Business and Maintenance of Existence. With respect
to the Company and its Subsidiaries taken as a whole, continue to engage in
business of a similar, related, synergistic or complimentary nature as now
conducted by it and preserve, renew and keep in full force and effect its
corporate existence and maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business and comply in all
material respects with all material Contractual Obligations (other than
Indebtedness and Contingent Obligations, which shall be beyond the scope of
this Section 5.4) and material Requirements of Law (except for Environmental
Laws, which shall be governed by Section 5.8), except as otherwise expressly
permitted by this Agreement.
<PAGE>44
5.5 Maintenance of Property; Insurance. Keep all property useful
and necessary in its business in good working order and condition; maintain
with financially sound and reputable insurance companies or through a formal
self-insurance program insurance on all its property in at least such amounts
and against at least such risks but including in any event public liability,
product liability and business interruption as are usually insured against in
the same general area by companies engaged in the same or a similar business;
and furnish to each Bank, upon written request, full information as to the
insurance carried.
5.6 Inspection of Property; Books and Records; Discussions. Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and, subject to
applicable governmental security and secrecy regulations, permit
representatives of any Bank to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may reasonably be desired with prior notice to the
Company (which can have a representative present if it so chooses), and to
discuss the business, operations, properties and financial and other condition
of the Company and its Subsidiaries with officers and employees of the Company
and its Subsidiaries and with its independent certified public accountants.
5.7 Notices. Promptly give notice (to be confirmed promptly in
writing) to the Administrative Agent and each Bank:
(a) of the occurrence of any Default or Event of Default;
(b) of any (i) default or event of default under any Contractual
Obligation of the Company or any Subsidiary or (ii) litigation, investigation
or proceeding which may exist at any time between the Company or any
Subsidiary and any Governmental Authority, which in either case, if not cured
or if adversely determined, as the case may be, could reasonably be expected
to have a Material Adverse Effect;
(c) of any litigation or proceeding affecting the Company or any
Subsidiary in which the amount involved is $15,000,000 or more and not covered
by insurance; or in which injunctive or similar relief is sought and which
could reasonably be expected to have a Material Adverse Effect;
(d) as soon as possible and in any event within 30 days after the
Company knows or has reason to know of the following events: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan which could reasonably be expected to result in any liability to the
Company or any Subsidiary in excess of $2,000,000 or any withdrawal from,
<PAGE>45
or the termination, Reorganization or Insolvency of, any Multiemployer Plan,
or (ii) the institution of proceedings or the taking or expected taking of any
other action by PBGC or the Company or any Commonly Controlled Entity with
respect to the withdrawal from, or the terminating, Reorganization or
Insolvency of, any Plan. The Company shall deliver to the Administrative
Agent and each Bank a certificate of the chief financial officer of the
Company setting forth the details thereof and the action that the Company or
Commonly Controlled Entity proposes to take with respect thereto;
(e) of any put notice received by the Company made pursuant to
Section 2.09 of the Stockholders Agreement;
(f) of any change in a Rating; and
(g) of any change in the business, operations, property or
financial or other condition of the Company or any of its Subsidiaries.
Each notice pursuant to this Section 5.7 shall be accompanied by a statement
of a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Company proposes to take with respect
thereto.
5.8 Environmental Laws.
(a) Comply with, and require compliance by all tenants and
subtenants, if any, with, all Environmental Laws and obtain and comply with
and maintain, and insure that all tenants and subtenants obtain and comply
with and maintain, any and all licenses, approvals, registrations or permits
required by Environmental Laws, except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required by a
Governmental Authority under Environmental Laws and promptly comply with all
lawful orders and directives of all Governmental Authorities respecting
Environmental Laws, except to the extent that the same are being contested in
good faith by appropriate proceedings and the pendency of such proceedings
could not reasonably be expected to have a Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Agents and the Banks,
and their respective employees, agents, officers and directors, from and
against any claims, demands, penalties, fines, liabilities, settlements,
damages, costs and expenses of whatever kind or nature known or unknown,
contingent or otherwise, arising out of, or in any way relating to the
violation of or noncompliance with any Environmental Laws applicable to the
Properties, or any orders, requirements or
<PAGE>46
demands of Governmental Authorities related thereto, including, without
limitation, attorney's and consultant's fees, investigation and laboratory
fees, court costs and litigation expenses, except to the extent that any of
the foregoing arise out of the gross negligence or willful misconduct of the
party seeking indemnification therefor. The agreements in this paragraph
shall survive repayment of the Notes and all other amounts payable hereunder.
5.9 Ratings. Take all reasonable action to enable Moody's and S&P,
or their respective successors, to have in effect a published or unpublished
rating for the Company's senior unsecured debt.
SECTION 6. NEGATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, any Note remains outstanding and unpaid or any other amount is owing
to any Bank or any Agent hereunder, the Company shall not nor shall it permit
any Subsidiary to, directly or indirectly:
6.1 Financial Condition Covenants. (a) Maintenance of Consolidated
Net Worth. Permit Consolidated Net Worth on the last day of any fiscal
quarter to be less than the sum of (X) $1 billion plus (Y) 40% of Consolidated
Net Income, if positive, for the period from April 1, 1993 to the last day of
such fiscal quarter.
(b) Interest Coverage. Permit the ratio of Consolidated Net Income
(before consolidated interest expense, interest income and taxes) to
consolidated interest expense (net of interest income) for the twelve-month
period ending on the last day of any fiscal quarter of the Company to be less
than 2.5 to 1.0, commencing with the fiscal quarter ending March 31, 1994.
6.2 Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness under this Agreement and the Revolving Credit
Agreement;
(b) Indebtedness outstanding under the 7% Indenture, the 9-1/8%
Indenture, the 8-3/8% Indenture and other Subordinated Debt;
(c) unsecured Indebtedness incurred in the ordinary course of
business consistent with prior practice in respect of commercial and standby
letters of credit issued by any financial institution to secure contractual
commitments to its customers;
(d) Customer Advances arising in the ordinary course of business
consistent with prior practice;
<PAGE>47
(e) Indebtedness arising out of clause (c) of the definition of
"Indebtedness" as a result of progress payments or advances made pursuant to
government contracts;
(f) Indebtedness owed by a Wholly Owned Subsidiary to another
Wholly Owned Subsidiary and Indebtedness owed to the Company by a Wholly Owned
Subsidiary; and
(g) in addition to any Indebtedness permitted by clauses (a)
through (f) above, Funded Debt incurred after the date hereof so long as the
ratio of consolidated Funded Debt of the Company and its consolidated
Subsidiaries to Consolidated Net Worth as of the last day of the most recently
completed fiscal quarter on a pro forma basis (i.e., after giving effect to
the incurrence of Funded Debt and the application of the proceeds thereof), as
if such debt had been incurred on the first day of such fiscal quarter, would
not exceed the ratio set forth below opposite the period in which such most
recently completed fiscal quarter occurred:
Period Ratio
Closing Date - March 31, 1995 1.65:1
April 1, 1995 - March 31, 1996 1.40:1
April 1, 1996 - March 31, 1997 1.25:1
Thereafter 1.00:1
Notwithstanding the foregoing, (x) no Subsidiary shall create, incur, assume
or suffer to exist any Funded Debt other than intercompany debt permitted by
clause (f) above if the principal amount of such Funded Debt exceeds 10% of
Consolidated Net Worth, and (y) no Funded Debt shall be created, incurred or
assumed after the occurrence of a Default or Event of Default or if such
creation, incurrence or assumption would result in a Default or Event of
Default, unless the Company shall obtain the written consent of the Required
Banks prior to such creation, incurrence or assumption.
6.3 Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except:
(a) Liens for taxes not yet due or which are being contested in
good faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Company or the appropriate
Subsidiary, as the case may be, in accordance with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business
which are not overdue for a period of more than 60 days or which are being
contested in good faith and by appropriate proceedings;
<PAGE>48
(c) pledges or deposits in connection with workmen's compensation,
unemployment insurance and other social security legislation and deposits
securing liabilities to insurance carriers under insurance and self-insurance
agreements;
(d) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions and other Liens incurred
in the ordinary course of business which do not secure Indebtedness and which
do not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
the Company or any Subsidiaries;
(f) Liens in favor of the United States of America for amounts paid
to the Company or any of the Subsidiaries as progress payments under
government contracts entered into by it;
(g) (i) Liens which were in existence on March 31, 1993 and which
secured obligations reflected in the audited balance sheet referred to in
Section 3.1(a) hereof, (ii) immaterial Liens created after March 31, 1993 and
in existence on the Effective Date, (iii) Liens on the assets of Loral Vought
Systems, Inc., and (iv) Liens on the assets of Federal Systems and its
Subsidiaries existing on the date of the acquisition thereof by the Company
and renewals and extensions of any of the foregoing which do not increase the
principal amount of the obligations secured thereby or extend to or cover any
property other than the property covered by any such Lien or property covered
by another permitted Lien on March 31, 1993, the Effective Date or such date
of acquisition, as the case may be;
(h) Liens on assets of corporations which become Subsidiaries after
the date of this Agreement; provided, that such Liens existed at the time the
respective corporations become Subsidiaries and were not created in
anticipation thereof;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(j) Liens upon real and/or personal property, which property was
acquired after the Effective Date by the Company or any Subsidiary in the
ordinary course of business, each of which Liens was created solely for the
purpose of securing Indebtedness incurred for the purpose of financing such
acquisition or for the purpose of securing any refinancings or renewals
thereof; provided, that no such Lien shall extend to or cover any property of
the Company or any such Subsidiary other than the respective property so
acquired and improvements thereon, and the principal
<PAGE>49
amount of Indebtedness secured by any such Lien shall at no time exceed 100%
of the fair market value (as determined in good faith by the board of
directors of the Company) of the respective property at the time it was
acquired; and
(k) Liens created pursuant to Section 2.6(c) and pursuant to
Section 2.6(c) of the Revolving Credit Agreement.
6.4 Limitation on Fundamental Changes. (a) Enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution) except that any
Subsidiary may be merged or consolidated (i) with or into the Company
(provided that the Company shall be the continuing or surviving corporation)
or (ii) with or into any one or more Wholly Owned Subsidiaries (including any
entity that, after giving effect to such merger or consolidation, is a Wholly
Owned Subsidiary) other than a Wholly Owned Subsidiary domiciled outside the
United States of America (provided that the Wholly Owned Subsidiary shall be
the continuing or surviving corporation); or
(b) convey, sell, lease, transfer or otherwise dispose of any
assets in a transaction or series of related transactions if the fair market
value of such assets (determined by the Board of Directors of the Company in
good faith) is greater than 10% of Consolidated Net Worth, except that:
(i) any Subsidiary may sell, lease, transfer or otherwise dispose
of any or all of its assets (upon voluntary liquidation or otherwise) to
the Company or a Wholly Owned Subsidiary (other than a Wholly Owned
Subsidiary domiciled outside the United States of America);
(ii) the Company or any Subsidiary may sell, lease, transfer or
otherwise dispose of inventory in the ordinary course of business;
(iii) the Company or any Subsidiary may sell, transfer or otherwise
dispose of Cash Equivalents in exchange for a comparable amount of cash
and/or Cash Equivalents;
(iv) the Company and its Subsidiaries may sell receivables in a
principal amount not to exceed $100,000,000 at any one time outstanding
to a special purpose vehicle for the purpose of a receivables-based
financing;
(v) the Company or any Subsidiary may convey, sell, lease, transfer
or otherwise dispose of any assets in a transaction or series of related
transactions if the fair market value of such assets (determined by the
Board of Directors of the Company in good faith) is greater than 10% of
Consolidated Net Worth and the amount of such excess is used to prepay
the Loans and to permanently reduce the Commitments and to prepay loans
and to permanently reduce
<PAGE>50
commitments under the Revolving Credit Agreement, ratably based on the
then Commitments and commitments under the Revolving Credit Agreement;
and
(vi) any Subsidiary may sell assets pursuant to existing Contractual
Obligations disclosed on Schedule 6.4.
6.5 Limitation on Restricted Payments. (a) Declare or pay any
dividends (other than dividends payable solely in stock of the Company or
Historical Dividends) on, or make any payment on account of, or set apart
assets for a sinking or other analogous fund for the purchase, redemption,
retirement or other acquisition of, any shares of any class of stock of the
Company or any Subsidiary (except dividends payable to the Company and
dividends by LAH on the Series S Preferred Stock issued by LAH), whether now
or hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in cash or property or in obligations
of the Company or any Subsidiary, or permit any Subsidiary to make any payment
on account of, or purchase or otherwise acquire, any shares of any class of
stock of the Company or any Subsidiary from any Person (all of the foregoing
shall collectively be referred to as "Restricted Payments"), except that, so
long as no Default or Event of Default has occurred and is continuing or would
result from the making of such Restricted Payment, the Company may make a
Restricted Payment if the sum of (i) such Restricted Payment plus (ii) the
Restricted Payments made from the Closing Date through any date of
determination, shall not exceed an amount equal to the sum of (A) $100,000,000
plus (B) 25% of the aggregate (if positive) Consolidated Net Income from
April 1, 1993 through the end of the fiscal quarter immediately preceding such
date of determination; or
(b) make any Investment (other than pursuant to clauses (b) through
(h) of Section 6.6) or incur, directly or indirectly, any Contingent
Obligation (all of the foregoing shall collectively be referred to as "Other
Restricted Payments"), except that, so long as no Default or Event of Default
has occurred and is continuing or would result from the making of such Other
Restricted Payment, the Company may make an Other Restricted Payment if the
sum of (i) such Other Restricted Payment plus (ii) the Other Restricted
Payments made from the Closing Date through any date of determination, shall
not exceed an amount equal to the sum of (A) 100% of the aggregate Equity
Issuance Proceeds received by the Company or any Subsidiary subsequent to
April 1, 1992 plus (B) upon any Person becoming a Wholly Owned Subsidiary, the
amount of any Investments made by the Company or any Wholly Owned Subsidiary
in such Person (other than Investments permitted by Section 6.6) prior to such
time plus (C) the proceeds from the sale of any Investment made with an Other
Restricted Payment permitted by this Section 6.5.
The value of any dividends paid other than in cash and the value of any
Investments made other than in cash shall be the value
<PAGE>51
determined in good faith by the Board of Directors of the Company and
evidenced by a resolution of such Board.
6.6 Investments. Make, commit to make or maintain any Investment,
except:
(a) as permitted by Section 6.5;
(b) Investments by the Company existing on the date hereof as set
forth on Schedule 6.6;
(c) Investments by the Company or Subsidiaries in Wholly Owned
Subsidiaries and Investments by Subsidiaries in the Company;
(d) Investments in accounts, contract rights and chattel paper (as
defined in the Uniform Commercial Code), and notes receivable, arising or
acquired in the ordinary course of business;
(e) Investments in Cash Equivalents;
(f) short-term Investments in adjustable rate preferred stock
issued by an issuer rated at least A-1 or the equivalent thereof by S&P
or P-1 or the equivalent thereof by Moody's;
(g) Excluded Employee Loans; and
(h) Investments consisting of the purchase by the Company of
Federal Systems under the Asset Purchase Agreement referred to in the
definition of "Federal Systems" set forth in Section 1.1.
6.7 Affiliates. Enter into any transaction, including, without
limitation, the purchase, sale or exchange of property or the rendering of any
services, with any Affiliate (other than a Wholly Owned Subsidiary) or enter
into, assume or suffer to exist any employment or consulting contract with any
such Affiliate, except any contract disclosed in the Company's Form 10-K for
the fiscal year ended March 31, 1993 filed with the Securities and Exchange
Commission (including any modification or amendment to any such contract that,
in the reasonable judgment of the Company, is no less favorable to the Company
than such contract) and any transaction or contract which is in the ordinary
course of the Company's business and which is upon fair and reasonable terms
no less favorable to the Company than it would obtain in a comparable arm's
length transaction with a Person not an Affiliate.
6.8 Sale and Leaseback. After the date hereof, enter into any
arrangement with any Person providing for the leasing by the Company or any
Subsidiary of real or personal property which has been or is to be sold or
transferred by the Company or any
<PAGE>52
Subsidiary 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 Company or such Subsidiary, unless the amount by which all
such transactions occurring after the Effective Date exceeds $50,000,000 is
applied by the Company to prepay the Loans and to permanently reduce the
Commitments.
6.9 Corporate Documents. Amend its Certificate of Incorporation in
any material respect adverse to the Banks (except to increase the number of
authorized shares of common stock).
6.10 Restrictions on Subsidiaries. Permit any Wholly Owned
Subsidiary to enter into any agreement which prohibits or restricts the
ability of such Wholly Owned Subsidiary to (i) pay dividends or make any other
distributions on its capital stock (other than the Series S Preferred Stock
issued by LAH), or any other interest or participation in, or measured by, its
profits, owned by the Company or any of its Wholly Owned Subsidiaries, or pay
any Indebtedness owed to the Company or any of its Wholly Owned Subsidiaries,
(ii) make loans or advances to the Company or any of its Wholly Owned
Subsidiaries or (iii) transfer any of its properties or assets to the Company
or any of its Wholly Owned Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of: (A) the terms of this Agreement,
(B) applicable law, (C) customary non-assignment provisions entered into in
the ordinary course of business and consistent with past practices, (D) the
terms of purchase money obligations for property acquired in the ordinary
course of business, but only to the extent that such purchase money
obligations restrict or prohibit the transfer of the property so acquired, (E)
any encumbrance or restriction with respect to a Wholly Owned Subsidiary of
the Company that is not a Wholly Owned Subsidiary of the Company on the
Effective Date which encumbrance or restriction is in existence at the time
such person becomes a Wholly Owned Subsidiary of the Company or is created on
the date it becomes a Wholly Owned Subsidiary of the Company, (F) any
encumbrance or restriction with respect to a Wholly Owned Subsidiary of the
Company imposed pursuant to an agreement which has been entered into for the
sale or disposition of all or substantially all the capital stock or assets of
such Wholly Owned Subsidiary or (G) any encumbrance or restriction existing
under any agreement which refinances or replaces the agreement described in
clause (A); provided, that the terms and conditions of any such encumbrances
or restrictions contained in any such agreement constitute no greater
encumbrance or restriction on the ability of any Wholly Owned Subsidiary to
pay dividends or make distributions, make loans or advances or transfer
properties or assets than those under or pursuant to the agreement evidencing
the Indebtedness or obligations refinanced.
<PAGE>53
SECTION 7. EVENTS OF DEFAULT
Upon the occurrence of any of the following events:
(a) The Company shall fail to pay any principal of any Notes when
due in accordance with the terms thereof or hereof; or the Company shall fail
to pay any interest on any Notes, or any fee or other amount payable
hereunder, within five days after any such amount becomes due in accordance
with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made by or on
behalf of the Company herein or which is contained in any certificate,
document or financial or other statement furnished at any time under or in
connection with this Agreement shall prove to have been incorrect in any
material respect on or as of the date made or deemed made; or
(c) The Company shall default in the observance or performance of
any agreement contained in Section 6; or
(d) The Company shall default in the observance or performance of
any other agreement contained in this Agreement, and such default shall
continue unremedied for a period of 30 days; or
(e) The Company or any of its Subsidiaries shall (A) default in any
payment of principal of or interest on any Indebtedness (other than the Notes)
or in the payment of any Contingent Obligation, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness or
Contingent Obligation was created and (I) the aggregate principal amount of
(x) all such Indebtedness equals or exceeds $15,000,000 or (y) all such
Contingent Obligations equals or exceeds $100,000,000 and (II) with respect to
a default in the payment of interest by the Company or any Subsidiary, the
effect of such default is to cause, or permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Contingent Obligation (or
a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or such Contingent
Obligation to become payable or (B) default in the observance or performance
of any other agreement or condition relating to any such Indebtedness or such
Contingent Obligation or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or
to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Contingent Obligation (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Contingent Obligation to become payable; or
<PAGE>54
(f) (i) The Company or any of its Substantial Subsidiaries shall
commence any case, proceeding or other action (A) under any existing or future
law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or
its debts, or (B) seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of its
assets, or the Company or any of its Substantial Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against the Company or any of its Substantial Subsidiaries any case,
proceeding or other action of a nature referred to in clause (i) above which
(A) results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a period
of 60 days; or (iii) there shall be commenced against the Company or any of
its Substantial Subsidiaries any case, proceeding or other action seeking
issuance of a warrant of attachment, execution, distraint or similar process
against all or any substantial part of its assets which results in the entry
of an order for any such relief which shall not have been vacated, discharged,
or stayed or bonded pending appeal within 60 days from the entry thereof; or
(iv) the Company or any of its Substantial Subsidiaries shall take any action
in furtherance of, or indicating its consent to, approval of, or acquiescence
in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the
Company or any of its Substantial Subsidiaries shall generally not, or shall
be unable to, or shall admit in writing its inability to, pay its debts as
they become due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302 of
ERISA), whether or not waived, shall exist with respect to any Plan, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion of the
Required Banks, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) the Company or any Commonly Controlled
Entity shall, or is, in the reasonable opinion of the Required Banks, likely
to, incur any liability in connection with a withdrawal from, or the
Insolvency or Reorganization of, a Multiemployer Plan, or (vi) any other event
or condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all
other such events or conditions, if any, could subject the Company or any of
its Subsidiaries to any
<PAGE>55
tax, penalty or other liabilities in the aggregate material in relation to the
business, operations, property or financial or other condition of the Company
and its Subsidiaries taken as a whole;
(h) One or more judgments or decrees shall be entered against the
Company or any of its Substantial Subsidiaries involving in the aggregate a
liability (not paid or fully covered by insurance) of $15,000,000 or more and
all such judgments or decrees shall not have been vacated, discharged, stayed
or bonded pending appeal within 60 days from the entry thereof; or
(i) A Change in Control shall occur; or
(j) An Event of Default shall occur under Section 7 of the
Revolving Credit Agreement;
then, and in any such event, (A) if such event is an Event of Default
specified in clause (i) or (ii) of paragraph (f) above, automatically the
Commitments shall immediately terminate and the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the
Notes shall immediately become due and payable, and (B) if such event is any
other Event of Default, either or both of the following actions may be taken,
without prejudice to the rights of any Bank to enforce its claims against the
Company: (i) with the consent of the Required Banks, the Administrative Agent
may, or upon the request of the Required Banks, the Administrative Agent
shall, by notice to the Company, declare the Commitments to be terminated
forthwith, whereupon the Commitments shall immediately terminate; and (ii)
with the consent of the Required Banks, the Administrative Agent may, or upon
the request of the Required Banks, the Administrative Agent shall, by notice
of default to the Company, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the Notes to be
due and payable forthwith, whereupon the same shall immediately become due and
payable. Except as expressly provided above in this Section 7, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.
SECTION 8. THE AGENTS
8.1 Appointment. Each Bank hereby irrevocably designates Morgan as
the Documentation Agent of such Bank under this Agreement and each such Bank
irrevocably authorizes Morgan, as the Documentation Agent for such Bank, to
take such action on its behalf under the provisions of this Agreement and to
exercise such powers and perform such duties as are expressly delegated to the
Documentation Agent by the terms of this Agreement, together with such other
powers as are reasonably incidental thereto. Each Bank hereby irrevocably
designates and appoints Chemical as the Administrative Agent of such Bank
under this Agreement, and each such Bank irrevocably authorizes Chemical, as
the
<PAGE>56
Administrative Agent for such Bank, to take such action on its behalf under
the provisions of this Agreement and to exercise such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. Each Bank hereby irrevocably designates and appoints each of
Barclays and Continental as an Agent of such Bank under this Agreement, and
each such Bank irrevocably authorizes each of Barclays and Continental, as an
Agent for such Bank, to take action on its behalf under this Agreement.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Agents shall not have any duties or responsibilities, except those expressly
set forth herein, or any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or otherwise exist against the Agents.
8.2 Delegation of Duties. The Agents may execute any of their
duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Agents shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by any of them with
reasonable care.
8.3 Exculpatory Provisions. No Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement (except for its or such
Person's own gross negligence or willful misconduct), or (ii) responsible in
any manner to any of the Banks for any recitals, statements, representations
or warranties made by the Company or any officer thereof contained in this
Agreement or in any certificate, report, statement or other document referred
to or provided for in, or received by such Agent under or in connection with,
this Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the Notes or for any
failure of the Company to perform its obligations hereunder or thereunder. No
Agent shall be under any obligation to any Bank to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records
of the Company.
8.4 Reliance by Agents. The Agents shall be entitled to rely, and
shall be fully protected in relying, upon any Note, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by them to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Company), independent accountants and other
<PAGE>57
experts selected by the Agents. The Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes unless a written
notice of assignment, negotiation or transfer thereof shall have been filed
with the Administrative Agent. The Administrative Agent shall be fully
justified in failing or refusing to take any action under this Agreement
unless it shall first receive such advice or concurrence of the Required Banks
as it deems appropriate or it shall first be indemnified to its satisfaction
by the Banks against any and all liability and expense which may be incurred
by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the Notes in accordance with
a request of the Required Banks, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Banks and all
future holders of the Notes.
8.5 Notice of Default. The Agents shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Bank or
the Company referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event
that the Administrative Agent receives such a notice, the Administrative Agent
shall give notice thereof to the Banks. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Banks; provided, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Banks.
8.6 Non-Reliance on Agents and Other Banks. Each Bank expressly
acknowledges that no Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates has made any representations or
warranties to it and that no act by any Agent hereafter taken, including any
review of the affairs of the Company, shall be deemed to constitute any
representation or warranty by such Agent to any Bank. Each Bank represents to
the Agents that it has, independently and without reliance upon the Agents or
any other Bank, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of
the Company and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Bank also represents that it will, independently
and without reliance upon the Agents or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own credit analysis, appraisals and/or decisions in taking or not
taking action under this Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, operations,
<PAGE>58
property, financial and/or other condition and creditworthiness of the
Company. Except for notices, reports and other documents expressly required
to be furnished to the Banks by the Administrative Agent hereunder, no Agent
shall have any duty or responsibility to provide any Bank with any credit or
other information concerning the business, operations, property, financial and
other condition or creditworthiness of the Company which may come into the
possession of such Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
8.7 Indemnification. The Banks agree to indemnify each Agent in
its capacity as such (to the extent not reimbursed by the Company and without
limiting the obligation of the Company to do so), ratably according to their
respective Commitment Percentages, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following the payment of the Notes)
be imposed on, incurred by or asserted against such Agent in any way relating
to or arising out of this Agreement, or any documents contemplated by or
referred to herein or the transactions contemplated hereby or any action taken
or omitted by such Agent under or in connection with any of the foregoing;
provided, that no Bank shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from such Agent's
gross negligence or willful misconduct. If any such amount with respect to
which the Banks have indemnified such Agent is recovered from the Company,
such Agent shall return the amount so recovered to the Banks which so
indemnified such Agent, but without interest, unless the Company has paid
interest. The agreements in this Section shall survive the payment of the
Notes and all other amounts payable hereunder.
8.8 Each Agent in Its Individual Capacity. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Company as though such Agent were not an Agent
hereunder. With respect to its Loans made or renewed by it and any Note
issued to it, each Agent shall have the same rights and powers under this
Agreement as any Bank and may exercise the same as though it were not an
Agent, and the terms "Bank" and "Banks" shall include each Agent in its
individual capacity. Each Bank and Transferee acknowledges that each of
Morgan, Chemical, Barclays and Continental is an agent and a lender under the
Revolving Credit Agreement.
8.9 Successor Agents. An Agent may resign as such upon 10 days'
notice to the Banks and the Company; provided, that such resignation shall not
become effective until a successor Agent is appointed in accordance with this
Section 8.9. If such Agent shall resign as an Agent under this Agreement,
then the
<PAGE>59
Required Banks shall appoint from among the Banks a successor agent for the
Banks which successor agent shall be approved by the Company, whereupon such
successor agent shall succeed to the rights, powers and duties of such Agent,
and any references to such Agent herein or in the Notes shall mean such
successor agent effective upon its appointment, and the former Agent's rights,
powers and duties as such shall be terminated, without any other or further
act or deed on the part of such former Agent or any of the parties to this
Agreement or any holders of the Notes. After any retiring Agent's resignation
as such, the provisions of this Section 8.9 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was an Agent under
this Agreement.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement, any Note, nor
any terms hereof or thereof may be amended, supplemented or modified except in
accordance with the provisions of this Section 9.1. With the written consent
of the Required Banks, the Documentation Agent, on behalf of the Banks and the
Agents, and the Company may, from time to time, enter into written amendments,
supplements or modifications hereto and to the Notes for the purpose of adding
any provisions to this Agreement or the Notes or changing in any manner the
rights of the Banks or of the Company hereunder or thereunder or waiving, on
such terms and conditions as the Documentation Agent may specify in such
instrument, any of the requirements of this Agreement or the Notes or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, supplement or modification shall (a) reduce
the amount or extend the scheduled maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce any fee payable to
any Bank hereunder, or reduce the principal amount of any Note, or change the
amount of any Bank's Commitment, in each case without the written consent of
each Bank affected thereby, or (b) amend, modify or waive any provision of
this Section 9.1, or reduce the percentage specified in the definition of
Required Banks, or consent to the assignment or transfer by the Company of any
of its rights and obligations under this Agreement, or release amounts in the
Cash Collateral Account other than in accordance with Section 2.6 in each case
without the written consent of all the Banks, or (c) amend, modify or waive
any provision of Section 8 without the written consent of the then Agents.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Banks and shall be binding upon the Company, the Banks,
the Agents and all future holders of the Notes. In the case of any waiver,
the Company, the Banks and the Agents shall be restored to their former
position and rights hereunder and under the outstanding Notes, and any Default
or Event of Default waived shall be deemed to be cured and not continuing; but
no such
<PAGE>60
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy or telex), and, unless otherwise expressly provided herein, shall be
deemed to have been duly given or made when delivered by hand, or three
Business Days after being deposited in the mail, postage prepaid, or, in the
case of telecopy notice, when received, or, in the case of telex notice, when
sent, answerback received, addressed as follows in the case of the Company and
the Agents, and as set forth in Schedule I in the case of the other parties
hereto, or to such other address as may be hereafter notified by the
respective parties hereto and any future holders of the Notes:
The Company: Loral Corporation
600 Third Avenue
New York, New York 10016
Attention: Michael P. DeBlasio
Senior Vice President - Finance
Telecopy: 212-661-8988
Telex: 64401
Answerback: LORAL CORP
with a copy to:
Loral Corporation
600 Third Avenue
New York, New York 10016
Attention: General Counsel
The Documentation
Agent: Morgan Guaranty Trust Company
of New York
60 Wall Street
New York, New York 10260-0600
Attention: Robert M. Osieski
Telecopy: 212-648-5014
with a copy to:
James T. Knight, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Telecopy: 212-455-2502
The Administrative
Agent: Chemical Bank
1375 Broadway, 8th Floor
New York, New York 10018
Attention: John C. Riordan
Telecopy: 212-827-4497
<PAGE>61
with a copy to:
Chemical Bank Agency
Services Corporation
Grand Central Tower
140 East 45th Street, 29th Floor
New York, New York 10017
Attention: Sandra Miklave
Telecopy: 212-270-0854
The Agent: Barclays Bank PLC
222 Broadway, 11th Floor
New York, New York 10038
Attention: S. Clarke Moody
Telecopy: 212-412-7580
The Agent: Continental Bank, N.A.
520 Madison Avenue, 3rd Floor
New York, New York 10022
Attention: Robert P. McKillip
Telecopy: 212-688-2905
; provided, that any notice, request or demand to or upon the Agents or the
Banks pursuant to Sections 2.3, 2.5, 2.6 and 2.7 shall not be effective until
received.
9.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Bank, any
right, remedy, power or privilege hereunder or under the Notes shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
remedy, power or privilege hereunder or thereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided or
provided in the Notes are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
9.4 Survival of Representations and Warranties. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement and the Notes.
9.5 Payment of Expenses and Taxes. The Company agrees (a) to pay
or reimburse each Agent for all its reasonable out-of-pocket costs and
expenses incurred in connection with the preparation and execution of, and any
amendment, supplement or modification to, this Agreement and the Notes and any
other documents prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and
<PAGE>62
disbursements of counsel to the Agents, (b) to pay or reimburse each Bank and
the Agents for all their reasonable costs and expenses incurred in connection
with the enforcement or preservation of any rights under this Agreement, the
Notes and any such other documents, including, without limitation, fees and
disbursements of counsel to the Agents and to the several Banks (including,
without limitation, the allocated costs of in-house counsel), (c) to pay,
indemnify, and hold each Bank and the Agents harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other taxes, if any,
which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any
waiver or consent under or in respect of, this Agreement, the Notes and any
such other documents, and (d) to pay, indemnify, and hold each Bank and the
Agents (and their respective directors, officers, employees and agents)
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever with respect to or arising out
of the execution, delivery, enforcement, performance, syndication and
administration of this Agreement, the Notes and any such other documents and
the use of proceeds of the Loans (all the foregoing, collectively, the
"indemnified liabilities"); provided, that the Company shall have no
obligation hereunder to any Agent or any Bank with respect to indemnified
liabilities arising from the gross negligence or willful misconduct of any
such Agent or any such Bank. The agreements in this Section 9.5 shall survive
repayment of the Notes and all other amounts payable hereunder.
9.6 Successors and Assigns; Participations; Purchasing Banks. (a)
This Agreement shall be binding upon and inure to the benefit of the Company,
the Banks, the Agents, all future holders of the Notes, and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of each Bank.
(b) Any Bank may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or
more banks or other entities ("Participants") participating interests in any
Loan owing to such Bank, any Note held by such Bank, the Commitment of such
Bank or any other interest of such Bank hereunder; provided, that if the
Participant is not an Affiliate of such Bank or another Bank, such Bank shall
obtain the prior consent of the Company to such sale of participating
interests (which consent shall not be unreasonably withheld or delayed); and
provided further, that such Bank shall reserve solely unto itself, and shall
not grant to any Participant, any part or all of its right to agree to the
amendment, modification or waiver of any of the terms of this Agreement, its
Note or any document related thereto, except to
<PAGE>63
the extent that such amendment, modification or waiver would reduce the
principal of, or interest on, the Notes or any fees payable hereunder, in each
case to the extent subject to such participation, or postpone the date of the
final maturity of, or any date fixed for any payment of interest on, the
Notes, in each case to the extent subject to such participation. In the event
of any such sale by a Bank of a participating interest to a Participant, such
Bank's obligations under this Agreement to the other parties to this Agreement
shall remain unchanged, such Bank shall remain solely responsible for the
performance thereof, such Bank shall remain the holder of any such Note for
all purposes under this Agreement and the Company, the Documentation Agent,
and the Administrative Agent shall continue to deal solely and directly with
such Bank in connection with such Bank's rights and obligations under this
Agreement. The Company agrees that if amounts outstanding under this
Agreement and the Notes are due and unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement and any Note to
the same extent as if the amount of its participating interest were owing
directly to it as a Bank under this Agreement or any Note; provided, that such
right of setoff shall be subject to the obligation of such Participant to
share with the Banks, and the Banks agree to share with such Participant, as
provided in Section 9.7. The Company also agrees that each Participant shall
be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.5 with respect
to its participation in the Commitments and the Loans outstanding from time to
time; provided, that no Participant shall be entitled to receive any greater
amount pursuant to such Sections than the transferor Bank would have been
entitled to receive in respect of the amount of the participation transferred
by such transferor Bank to such Participant had no such transfer occurred.
(c) Any Bank may, in the ordinary course of its commercial banking
business and in accordance with applicable law, and (if the Purchasing Bank is
not an Affiliate of such Bank or an existing Bank) with the prior consent of
the Company (which shall not be unreasonably withheld or delayed), at any time
sell to one or more banks or financial institutions ("Purchasing Banks") all
or any part of its rights and obligations under this Agreement and the Notes,
pursuant to a Commitment Transfer Supplement, executed by such Purchasing Bank
and such transferor Bank, and delivered to the Administrative Agent for its
acceptance and recording in the Register; provided, that if the Purchasing
Bank is not an Affiliate of such Bank or an existing Bank any sale of Loans
shall be in an amount equal to the lesser of (i) such Bank's Commitment and
(ii) $6,250,000; and provided, further, that no Bank may sell any part of its
rights and obligations under this Agreement and the Notes to a Purchasing Bank
unless a ratable share of its rights and obligations under the Revolving
Credit Agreement are simultaneously sold to such Purchasing Bank. Upon such
execution, delivery, acceptance and
<PAGE>64
recording, from and after the Transfer Effective Date determined pursuant to
such Commitment Transfer Supplement, (x) the Purchasing Bank thereunder shall
be a party hereto and, to the extent provided in such Commitment Transfer
Supplement, have the rights and obligations of a Bank hereunder with a
Commitment as set forth therein, and (y) the transferor Bank thereunder shall,
to the extent provided in such Commitment Transfer Supplement, be released
from its obligations under this Agreement (and, in the case of a Commitment
Transfer Supplement covering all or the remaining portion of a transferor
Bank's rights and obligations under this Agreement, such transferor Bank shall
cease to be a party hereto). Such Commitment Transfer Supplement shall be
deemed to amend this Agreement to the extent, and only to the extent,
necessary to reflect the addition of such Purchasing Bank and the resulting
adjustment of Commitment Percentages arising from the purchase by such
Purchasing Bank of all or a portion of the rights and obligations of such
transferor Bank under this Agreement and the Notes. On or prior to the
Transfer Effective Date determined pursuant to such Commitment Transfer
Supplement, the Company, at its own expense, shall execute and deliver to the
Administrative Agent in exchange for the surrendered Note a new Note to the
order of such Purchasing Bank in an amount equal to the Commitment assumed by
it pursuant to such Commitment Transfer Supplement and, if the transferor Bank
has retained a Commitment hereunder, a new Note to the order of the transferor
Bank in an amount equal to the Commitment retained by it hereunder. Such new
Notes shall be dated the Closing Date and shall otherwise be in the form of
the Notes replaced thereby. The Note surrendered by the transferor Bank shall
be returned by the Administrative Agent to the Company marked "cancelled".
(d) The Administrative Agent shall maintain at its address referred
to in Section 9.2 a copy of each Commitment Transfer Supplement delivered to
it and a register (the "Register") for the recordation of the names and
addresses of the Banks and the Commitment of, and principal amount of the
Loans owing to, each Bank from time to time. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Company, the
Administrative Agent and the Banks may treat each Person whose name is
recorded in the Register as the owner of the Loan recorded therein for all
purposes of this Agreement. The Register shall be available for inspection by
the Company or any Bank at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of a Commitment Transfer Supplement executed
by a transferor Bank and a Purchasing Bank together with payment to the
Administrative Agent of a registration and processing fee of $4,000, the
Administrative Agent shall (i) promptly accept such Commitment Transfer
Supplement and (ii) on the Transfer Effective Date determined pursuant thereto
record the information contained therein in the Register and give notice of
such acceptance and recordation to the Documentation Agent, the Banks and the
Company.
<PAGE>65
(f) The Company authorizes each Bank to disclose to any Participant
or Purchasing Bank (each, a "Transferee") and any prospective Transferee any
and all financial information in such Bank's possession concerning the Company
and its affiliates which has been delivered to such Bank by or on behalf of
the Company pursuant to this Agreement or which has been delivered to such
Bank by or on behalf of the Company in connection with such Bank's credit
evaluation of the Company and its affiliates prior to becoming a party to this
Agreement; provided, that such Transferee or prospective Transferee agrees in
writing to be bound by the confidentiality provisions set forth in Section
9.14 hereof.
(g) If, pursuant to this Section 9.6, any interest in this
Agreement or any Note is transferred to any Transferee which is organized
under the laws of any jurisdiction other than the United States or any State
thereof, the transferor Bank shall cause such Transferee, concurrently with
the effectiveness of such transfer, (i) to represent to the transferor Bank
(for the benefit of the transferor Bank, the Agents and the Company) that
under applicable law and treaties no taxes will be required to be withheld by
the Administrative Agent, the Company or the transferor Bank with respect to
any payments to be made to such Transferee in respect of the Loans, (ii) to
furnish to the transferor Bank (and, in the case of any Purchasing Bank
registered in the Register, the Administrative Agent and the Company) either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 (wherein such Transferee claims entitlement to complete exemption from
U.S. federal withholding tax on all interest payments hereunder) and an
Internal Revenue Service Form W-8 or W-9 or successor applicable form (wherein
such Transferee claims exemption from United States backup withholding tax)
and (iii) to agree (for the benefit of the transferor Bank, the Agents and the
Company) to provide the transferor Bank (and, in the case of any Purchasing
Bank registered in the Register, the Administrative Agent and the Company) a
new Form 4224 or 1001 or Form W-8 or W-9 upon the expiration or obsolescence
of any previously delivered form and comparable statements in accordance with
applicable U.S. laws and regulations and amendments duly executed and
completed by such Transferee, and to comply from time to time with all
applicable U.S. laws and regulations with regard to such withholding and
backup withholding tax exemptions.
(h) Nothing herein shall prohibit any Bank from pledging or
assigning any Note to any Federal Reserve Bank in accordance with applicable
law.
9.7 Adjustments; Set-off. (a) If any Bank (a "benefitted Bank")
shall receive any payment of all or part of its Loans or interest thereon, or
receive any collateral in respect of its Loans (in each case whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in clause (f) of Section 7, or otherwise)
<PAGE>66
in a greater proportion than any such payment to and collateral received by
any other Bank, if any, in respect of such other Bank's Loans or interest
thereon, or Loans or interest thereon, such benefitted Bank shall purchase for
cash from the other Banks such portion of each such other Bank's Loans, or
shall provide such other Banks with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefitted Bank to
share the excess payment or benefits of such collateral or proceeds ratably
with each of the Banks; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such benefitted Bank,
such purchase shall be rescinded, and the purchase price and benefits
returned, to the extent of such recovery, but without interest. The Company
agrees that each Bank so purchasing a portion of another Bank's Loans may
exercise all rights of payment (including, without limitation, rights of set-
off) with respect to such portion as fully as if such Bank were the direct
holder of such portion.
(b) In addition to any rights and remedies of the Banks provided by
law, each Bank shall have the right, without prior notice to the Company, any
such notice being expressly waived by the Company to the extent permitted by
applicable law, upon any amount becoming due and payable by the Company
hereunder or under the Notes (whether at the stated maturity, by acceleration
or otherwise) to set off and appropriate and apply against such amount any and
all deposits (general or special, time or demand, provisional or final), in
any currency, and any other credits, indebtedness or claims, in any currency,
in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Bank to or for the credit or the
account of the Company. Each Bank agrees promptly to notify the Company and
the Administrative Agent after any such set-off and application made by such
Bank; provided, that the failure to give such notice shall not affect the
validity of such set-off and application.
9.8 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
9.9 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts and all
of said counterparts taken together shall be deemed to constitute one and the
same instrument. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Company and the Agent.
9.10 GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT
<PAGE>67
AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
9.11 Submission To Jurisdiction; Waivers. The Company hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or the Notes, or for recognition
and enforcement of any judgement in respect thereof, to the non-exclusive
general jurisdiction of the courts of the State of New York, the courts
of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be affected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to the
Company at its address set forth in Section 9.2 or at such other address
of which the Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding
referred to in this Section any special, exemplary, punitive or
consequential damages.
9.12 WAIVERS OF JURY TRIAL. THE COMPANY, THE AGENTS AND THE BANKS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES AND FOR ANY COUNTERCLAIM
THEREIN.
9.13 Integration. This Agreement represents the agreement of the
Company, the Agents and the Banks with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by any
Agent or any Bank relative to the subject matter hereof not expressly set
forth or referred to herein or in the Notes.
9.14 Confidentiality. The Banks shall hold all non-public
information obtained pursuant to the requirements of this Agreement which has
been identified as such by the Company in accordance with their customary
procedures for handling
<PAGE>68
confidential information of this nature and in accordance with safe and sound
banking practices but in any event may make disclosure reasonably required by
a bona fide prospective Purchasing Bank or Participant in connection with the
contemplated transfer of any Note or participation therein (subject to such
prospective Purchasing Bank's or Participant's compliance with Section 9.6(f)
hereof) or as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process.
<PAGE>69
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in New York, New York by their proper and duly
authorized officers as of the day and year first above written.
LORAL CORPORATION
By: /s/ Nicholas C. Moren
Title: Vice President and
Treasurer
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation
Agent and as a Bank
By: /s/ Caroline R. Shapiro
Title: Vice President
CHEMICAL BANK, as
Administrative Agent and as
a Bank
By: /s/ John C. Riordan
Title: Vice President
BARCLAYS BANK PLC, as Agent and
as a Bank
By: /s/ Richard Lane
Title: Associate Director
CONTINENTAL BANK, N.A.,
as Agent and as a Bank
By: /s/ Kathryn W. Robinson
Title: Vice President
ABN AMRO BANK N.V., NEW YORK BRANCH,
as a Bank
By: /s/ Nancy F. Watkins
Title: Group Vice President
By: /s/ Margaret P. Hannahoe
Title: Assistant Vice President
<PAGE>70
NATIONSBANK OF NORTH CAROLINA,
N.A., as a Bank
By: /s/ Sally L. Hazard
Title: Senior Vice President
DEUTSCHE BANK AG, NEW YORK
AND/OR CAYMAN ISLANDS
BRANCH, as a Bank
By: /s/ Bowen T. Depke
Title: Assistant Vice President
By: /s/ Rolf-Peter Mikolayczyk
Title: Director
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, NEW YORK BRANCH, as
a Bank
By: /s/ Takeshi Kawano
Title: Senior Vice President
ROYAL BANK OF CANADA, as a Bank
By: /s/ Alexander Birr
Title: Senior Manager
BANCA COMMERCIALE ITALIANA,
NEW YORK BRANCH, as a Bank
By: /s/ Charles Dougherty
Title: Vice President
By: /s/ Julia M. Welch
Title: Assistant Vice President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Bank
By: /s/ Thomas J. Somers
Title: Vice President
<PAGE>71
THE BANK OF NEW YORK, as a Bank
By: /s/ Mary Anne Zagroba
Title: Vice President
BANQUE NATIONALE DE PARIS, as a
Bank
By: /s/ Richard Cushing
Title: Assistant Vice President
By: /s/ Michael E. Boches
Title: Assistant Vice President
LTCB TRUST COMPANY, as a Bank
By: /s/ John J. Sullivan
Title: Executive Vice President
PNC BANK, NATIONAL ASSOCIATION,
as a Bank
By: /s/ Mark Williams
Title: Vice President
SOCIETE GENERALE, NEW YORK
BRANCH, as a Bank
By: /s/ Salvatore Galatioto
Title: Vice President
J.P. MORGAN DELAWARE, as a Bank
By: /s/ Philip S. Detjens
Title: Vice President
<PAGE>72
CREDIT LYONNAIS, NEW YORK
BRANCH, as a Bank
By: /s/ Mark Campelloni
Title: Vice President
MELLON BANK, N.A., as a Bank
By: /s/ David R. Evans
Title: Vice President
NATIONAL CITY BANK, as a Bank
By: /s/ Jeffrey J. Tengel
Title: Vice President
THE NIPPON CREDIT BANK, LTD.,
as Bank
By: /s/ Clifford Abramsky
Title: Vice President and Manager
BAYERISCHE LANDESBANK
GIROZENTRALE, as a Bank
By: /s/ Wilfried Freudenberger
Title: Executive Vice President
and General Manager
By: /s/ Peter Obermann
Title: First Vice President
Manager Corporate Finance
CANADIAN IMPERIAL BANK OF
COMMERCE, (NEW YORK AGENCY),
as a Bank
By: /s/ Brian E. O'Callahan
Title: Authorized Signatory
<PAGE>73
CREDIT SUISSE, as a Bank
By: /s/ Chris T. Horgan
Title: Associate
By: /s/ Michael C. Mast
Title: Member of Senior
Management
THE CHASE MANHATTAN BANK, N.A.,
as a Bank
By: /s/ Patricia B. Bril
Title: Managing Director
THE FUJI BANK, LIMITED, NEW
YORK BRANCH, as a Bank
By: /s/ Takashi Nagao
Title: Vice President and Manager
THE MITSUBISHI BANK, LIMITED,
NEW YORK BRANCH, as a Bank
By: /s/ J. Bruce Meredith
Title: Senior Vice President
and Manager
THE SANWA BANK LIMITED, as
a Bank
By: /s/ Y. Maeda
Title: Vice President
THE BANK OF NOVA SCOTIA, as a
Bank
By: /s/ Terry K. Fryett
Title: Vice President
<PAGE>74
SUMITOMO BANK, LIMITED, NEW
YORK BRANCH, as a Bank
By: /s/ E. Sumino
Title: Joint General Manager
WELLS FARGO BANK, N.A., as a
Bank
By: /s/ Kathleen J. Harrison
Title: Vice President
<PAGE>75
SCHEDULE I TO
364-DAY REVOLVING
CREDIT AGREEMENT
Commitments and Commitment Percentages
Commitment
Bank Commitments Percentages
Morgan Guaranty Trust $14,705,900 2.941%
Company of New York
60 Wall Street
New York, New York 10260-0060
Attention: Robert M. Osieski, VP
Telecopy: (212) 648-5014
Domestic Lending Office:
Morgan Guaranty Trust
Company of New York
60 Wall Street
Attention: Loan Department
New York, New York 10260
Eurodollar Lending Office:
Morgan Guaranty Trust
Company of New York
Nassau, Bahamas Office
c/o J.P. Morgan Services, Inc.
Loan Operations - 3rd Floor
500 Stanton Christiana Road
Newark, Delaware 19713
Chemical Bank 27,941,192 5.588%
1375 Broadway
New York, New York 10018
Attention: John C. Riordan, VP
Telecopy: (212) 827-4497
Domestic Lending Office and
Eurodollar Lending Office:
Chemical Bank
270 Park Avenue
New York, New York 10017
<PAGE>76
Commitment
Bank Commitmants Percentages
Barclays Bank PLC 27,941,192 5.588%
222 Broadway
New York, New York 10038
Attention: S. Clarke Moody,
Director
Telecopy: (212) 412-7580
Domestic Lending Office and
Eurodollar Lending Office:
Barclays Bank PLC
222 Broadway
New York, New York 10038
Continental Bank, N.A. 27,941,192 5.588%
231 South LaSalle
Chicago, Illinois 60697
Attention: Ken Washington
Telecopy: (312) 828-5140
Domestic Lending Office and
Eurodollar Lending Office:
Continental Bank, N.A.
231 South LaSalle
Chicago, Illinois 60697
Attention: Josephine Guzman
ABN AMRO Bank N.V., 7,352,940 1.471%
New York Branch
500 Park Avenue
2nd Floor
New York, New York 10022
Attention: Margaret P. Hannahoe,
Corporate Banking
Officer
Telecopy: (212) 832-7129
Domestic Lending Office and
Eurodollar Lending Office:
ABN AMRO Bank N.V.
New York Branch
500 Park Avenue
2nd Floor
New York, New York 10022
<PAGE>77
Commitment
Bank Commitments Percentages
Nationsbank of North 20,588,232 4.118%
Carolina, N.A.
100 North Tryon Street
Charlotte, NC 28255
Attention: Lisa McClelland
Telecopy: (704) 386-8694
Domestic Lending Office and
Eurodollar Lending Office:
Nationsbank of North
Carolina, N.A.
100 North Tryon Street
Charlotte, NC 28255
Attention: Lisa McClelland
Telecopy: (704) 386-8694
With Copy to the New York Office:
NationsBank
767 Fifth Avenue
23rd Floor
New York, New York 10153
Attention: Sally Hazard
Telecopy: (212) 593-1083
Deutsche Bank AG 20,588,232 4.118%
New York Branch
31 West 52d Street
24th Floor
New York, New York 10019
Attention: Rolf Peter Mikolayczyk,
VP
Telecopy: (212) 474-8212
Domestic Lending Office:
Deutsche Bank AG, New York Branch
31 West 52nd Street
24th Floor
New York, New York 10019
Eurodollar Lending Office:
Deutsche Bank AG, Cayman Islands Branch
c/o Deutsche Bank AG, New York Branch
31 West 52nd Street
24th Floor
New York, New York 10019
<PAGE>78
Commitment
Bank Commitments Percentages
The Industrial Bank 19,117,644 3.824%
of Japan, Limited,
New York Branch
245 Park Avenue
New York, New York 10167-0037
Attention: Tomoya Aoki
Telecopy: (212) 856-9450
Domestic Lending Office and
Eurodollar Lending Office:
The Industrial Bank of Japan,
Limited, New York Branch
245 Park Avenue
New York, New York 10167-0037
Banca Commerciale Italiana 7,352,940 1.471%
New York Branch
One William Street
New York, New York 10004
Attention: Mimi Welch, AVP
Telecopy: (212) 809-2124
Domestic Lending Office and
Eurodollar Lending Office:
Banca Commerciale Italiana
New York Branch
One William Street
New York, New York 10004
Bank of America National 20,588,232 4.118%
Trust and Savings Association
335 Madison Avenue #5727
5th Floor - Unit #5727
New York, New York 10017
Attention: Tom Somers, VP
Telecopy: (212) 503-7031
Domestic Lending Office and
Eurodollar Lending Office:
Bank of America National Trust
and Savings Association
1850 Gateway Boulevard
Concord, California 94520
<PAGE>79
Commitment
Bank Commitments Percentages
The Bank of New York 19,117,644 3.824%
One Wall Street
8th Floor
New York, New York 10286
Attention: Kenneth P. Sneider, AVP
Telecopy: (212) 635-1480
Domestic Lending Office and
Eurodollar Lending Office:
The Bank of New York
One Wall Street
8th Floor
New York, New York 10286
Banque Nationale de Paris 11,764,704 2.353%
499 Park Avenue
7th Floor
New York, New York 10022
Attention: Alex Jackson, AVP
Telecopy: (212) 418-8269
Domestic Lending Office and
Eurodollar Lending Office:
Banque Nationale de Paris
499 Park Avenue
7th Floor
New York, New York 10022
LTCB Trust Company 11,764,704 2.353%
165 Broadway
New York, New York 10006
Attention: Laura Buckley
Telecopy: (212) 608-2371
Domestic Lending Office and
Eurodollar Lending Office:
LTCB Trust Company
165 Broadway
New York, New York 10006
PNC Bank, National Association 19,117,644 3.824%
335 Madison Avenue
10th Floor
New York, New York 10017
Attention: Mark Williams, VP
Telecopy: (212) 557-5461
<PAGE>80
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
PNC Bank, National Association
335 Madison Avenue
10th Floor
New York, New York 10017
Royal Bank of Canada 19,117,644 3.824%
Financial Square
New York, New York 10005
Attention: Alexander Birr
Telecopy: (212) 809-7468
Domestic Lending Office and
Eurodollar Lending Office:
Royal Bank of Canada
Financial Square
New York, New York 10005
Societe Generale 20,588,232 4.118%
New York Branch
50 Rockefeller Plaza
3rd Floor
New York, New York 10020
Attention: Gordon Eadon
Telecopy: (212) 581-8752
Domestic Lending Office and
Eurodollar Lending Office:
Societe Generale
New York Branch
50 Rockefeller Plaza
3rd Floor
New York, New York 10020
J.P. Morgan Delaware 13,235,292 2.647%
902 Market Street
Wilmington, Delaware 19801
Attention: Philip S. Detjens
Telecopy: (302) 654-5336
<PAGE>81
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
J.P. Morgan Services, Inc.
500 Stanton-Christiana Road
Newark, Delaware 19713-2107
Attention: Loan Department
Credit Lyonnais 20,588,232 4.118%
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Attention: David Cawrse, VP
Telecopy: (212) 459-3179
Domestic Lending Office:
Credit Lyonnais
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Eurodollar Lending Office:
Credit Lyonnais
Cayman Island Branch
c/o Credit Lyonnais
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Mellon Bank, N.A. 19,117,644 3.824%
3 Mellon Bank Center
Room # 153-2332
Pittsburgh, Pennsylvania 15258
Attention: F. Lindsay, Loan Admin.
Telecopy: (412) 236-2028
with a copy for credit purposes to:
Mellon Bank, N.A.
Mellon Financial Services
65 East 55th Street
15th Floor
New York, New York 10022-3219
Attention: David R. Evans,
Vice President
Telecopy: (212) 702-5269
<PAGE>82
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
Mellon Bank, N.A.
3 Mellon Bank Center
Room # 153-2332
Pittsburgh, Pennsylvania 15258
National City Bank 8,823,528 1.765%
National City Center
10th Floor
1900 E. 9th Street
Cleveland, Ohio 44114
Attention: Renold D. Thompson, Jr.,
VP
Telecopy: (216) 575-9396
Domestic Lending Office and
Eurodollar Lending Office:
National City Bank
National City Center
10th Floor
1900 E. 9th Street
Cleveland, Ohio 44114
The Nippon Credit Bank, LTD. 11,764,704 2.353%
New York Branch
245 Park Avenue
30th Floor
New York, New York 10167
Attention: Michael Monteleone
Telecopy: (212) 490-3895
Domestic Lending Office and
Eurodollar Lending Office:
The Nippon Credit Bank, LTD.
New York Branch
245 Park Avenue
30th Floor
New York, New York 10167
The Chase Manhattan Bank, N.A. 16,176,468 3.235%
One Chase Manhattan Plaza
5th Floor
New York, New York 10081
Attention: Richard C. Smith
Telecopy: (212) 552-1457
<PAGE>83
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza
5th Floor
New York, New York 10081
The Fuji Bank, Limited 14,705,880 2.941%
New York Branch
2 World Trade Center
79th Floor
New York, New York 10048
Attention: Raymond Ventura
Asst. Vice President
Telecopy: (212) 912-0516
Domestic Lending Office and
Eurodollar Lending Office:
The Fuji Bank, Limited
New York Branch
2 World Trade Center
New York, New York 10048
The Sanwa Bank Limited 10,294,116 2.059%
55 East 52nd Street
24th Floor
New York, New York 10055
Attention: Dominic Sorresso
Telecopy: (212) 754-1304
Domestic Lending Office and
Eurodollar Lending Office:
The Sanwa Bank Limited
55 East 52nd Street
24th Floor
New York, New York 10055
Sumitomo Bank, Limited 10,294,116 2.059%
New York Branch
One World Trade Center
Suite 9651
New York, New York 10048
Attention: Diana Hurtzig
Telecopy: (212) 553-0118
<PAGE>84
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
Sumitomo Bank, Limited
New York Branch
One World Trade Center
Suite 9651
New York, New York 10048
Wells Fargo Bank, N.A. 16,176,468 3.235%
Corporate Banking
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Attention: Kathleen Harrison
Vice President
Telecopy: (415) 421-1352
Domestic Lending Office:
Wells Fargo Bank, N.A.
Corporate Banking
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Eurodollar Lending Office:
Wells Fargo Bank, N.A.
Corporate Banking
Attention: Lupe Barajas
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Bayerische Landesbank 10,294,116 2.059%
Girozentrale
560 Lexington Avenue
22nd Floor
New York, New York 10022
Attention: Joanne Cicino
Telecopy: (212) 310-9868
Domestic Lending Office:
Bayerische Landesbank
Girozentrale
560 Lexington Avenue
22nd Floor
New York, New York 10022
<PAGE>85
Commitment
Bank Commitments Percentages
Eurodollar Lending Office:
Bayerische Landesbank
Girozentrale
Cayman Islands Branch
560 Lexington Avenue
22nd Floor
New York, New York 10022
Canadian Imperial Bank of 16,176,468 3.235%
Commerce, (New York Agency)
425 Lexington Avenue
6th Floor
New York, New York 10017
Attention: Brian E. O'Callahan
Telecopy: (212) 856-3991
Domestic Lending Office and
Eurodollar Lending Office:
Two Paces West
2727 Paces Ferry Road
Suite 1200
Atlanta, Georgia 30339
Credit Suisse 14,705,880 2.941%
12 East 49th Street
44th Floor
New York, New York 10017
Attention: Chris Horgan
Telecopy: (212) 238-5439
Domestic Lending Office and
Eurodollar Lending Office:
Credit Suisse
12 East 49th Street
44th Floor
New York, New York 10017
The Mitsubishi Bank, Limited 14,705,880 2.941%
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Attention: Mr. J. Bruce Meredith
Senior Vice President
Telecopy: (212) 667-2888
<PAGE>86
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
The Mitsubishi Bank, Limited
225 Liberty Street
Two World Financial Center
New York, New York 10281
The Bank of Nova Scotia 7,352,940 1.471%
One Liberty Plaza
26th Floor
New York, New York 10006
Attention: Dan Foote
Telecopy: (212) 225-5090
Domestic Lending Office and
Eurodollar Lending Office:
The Bank of Nova Scotia
One Liberty Plaza
26th Floor
New York, New York 10006
____________ _______
$500,000,000 100.000%
============ =======
<PAGE>87
SCHEDULE 3.1
TO 364-DAY
CREDIT AGREEMENT
CERTAIN LIABILITIES
1. Certain liabilities to be assumed and recorded in connection with the
acquisition of Federal Systems.
<PAGE>88
SCHEDULE 3.13
TO 364-DAY
CREDIT AGREEMENT
CERTAIN SUBSIDIARIES
Be MI AG Olten
Cosmotech
Loral Federal Systems Company
IBM International Air Traffic Corporation*
International Business Machines Aerospace Systems
Integration Corporation*
IBM Federal Sector Services Corporation*
* To be acquired as part of the acquisition of Federal Systems.
<PAGE>89
SCHEDULE 6.4
TO 364-DAY
CREDIT AGREEMENT
EXISTING CONTRACTUAL OBLIGATIONS
1. Sections 2.07 and 2.08, and any other provisions as they relate to
Contractual Obligations, of that certain Stockholders Agreement dated as of
November 13, 1992 by and among Loral Aerospace Holdings, inc., a Delaware
corporation, Loral Aerospace Corp., a Delaware corporation, Loral Corporation,
a New York corporation, Shearson Lehman Brothers Capital Partners II, L.P.,
Lehman Brothers Merchant Banking Portfolio Partnership L.P., Lehman Brothers
Offshore Investment Partnership L.P. and Lehman Brothers Offshore Investment
Partnership-Japan, L.P.
<PAGE>90
SCHEDULE 6.6
TO 364-DAY
CREDIT AGREEMENT
LORAL CORPORATION AND SUBSIDIARIES
Certain Investments as of December 31, 1993
($,000)
Lermer Packaging, Inc. Preferred Stock,
plus accrued dividends $ 5,382
Program Investment in Aircraft Braking
Systems Corporation 3,200
K & F Industries, Inc. 14.75% Convertible
Debentures, plus accrued interest 59,220
Notes Receivable-Various 3,904
Investment in and long-term advances to
Space Systems/Loral, Inc., at cost 137,364
Investment in Consolidated Subsidiaries
Mikrodalga Electronik Sistember Sanayi
Ve Tacaret Anonim Sirketi (50.67%) 5,000
Loral Qualcomm Satellite Services, Inc. 10,234
<PAGE>91
EXHIBIT A
TO 364-DAY
CREDIT AGREEMENT
[FORM OF NOTE]
NOTE
PRINCIPAL AMOUNT:
[PRINCIPAL AMOUNT] New York, New York
($ ) February 23, 1994
BANK: [NAME OF BANK]
FOR VALUE RECEIVED, LORAL CORPORATION, a New York corporation (the
"Company"), hereby unconditionally promises to pay to the order of the Bank
stated above (the "Bank") at the office of Chemical Bank located at 270 Park
Avenue, New York, New York 10017, on February , 1995, in lawful money of
the United States of America and in immediately available funds, the principal
amount of the lesser of (a) the principal amount stated above, and (b) the
aggregate unpaid principal amount of all Loans made by the Bank to the Company
pursuant to Section 2.1(a) of the 364-Day Revolving Credit Agreement, dated as
of February 23, 1994, among the Company, the Bank, the other financial
institutions parties thereto, Morgan Guaranty Trust Company of New York, as
Documentation Agent, Chemical Bank, as Administrative Agent, and Barclays Bank
PLC and Continental Bank, N.A., as Agents (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"; terms defined
therein being used herein as therein defined unless otherwise defined herein).
The Company further agrees to pay interest in like money at such office on the
unpaid principal amount hereof and, to the extent permitted by applicable law,
overdue accrued interest in respect thereof, from time to time from the date
hereof until such amount is paid in full (whether at the stated maturity, by
acceleration or otherwise) at the rates, for the periods and on the dates
specified in Section 2.9 of the Credit Agreement.
The holder of this Note is authorized to endorse the date, Type and
amount of each Loan made pursuant to Section 2.1(a) of the Credit Agreement,
each continuation thereof, each conversion of all or a portion thereof to
another Type, the date and amount of each repayment of principal thereof and,
in the case of each Eurodollar Loan and C/D Rate Loan, the length of the
Interest Period with respect thereto, on Schedules A, B and C annexed to, and
constituting a part of, this Note, and any such recordation
<PAGE>92
shall constitute prima facie evidence of the accuracy of the information so
recorded; provided, that the failure to record, or the improper recording of,
any such information shall not affect the obligations of the Company under
this Note.
This Note is one of the Notes referred to in the Credit Agreement
and is entitled to the benefits thereof and is subject to prepayment in whole
or in part as provided therein.
Upon the occurrence of any one or more of the Events of Default
specified in the Credit Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all
as provided therein.
All parties now or hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby
waive presentment, demand, protest and all other notices of any kind.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
LORAL CORPORATION
By:
Title:
<PAGE>93
Schedule A to 364-Day
Revolving Credit Note
BASE RATE LOANS
AND REPAYMENTS OF BASE RATE LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Amount Converted Amount of Amount Converted Amount Converted Unpaid Principal
Amount of Base to Base Rate Principal to Eurodollar to C/D Rate Balance of Base Notation Made
Date Rate Loans Loans Repaid Loans Loans Rate Loans By
</TABLE>
<PAGE>94
Schedule B to 364-Day
Revolving Credit Note
EURODOLLAR LOANS
AND REPAYMENTS OF EURODOLLAR LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest
Period and Unpaid
Amount Eurodollar Amount Amount Principal
Amount of Converted to Rate with Amount of Converted to Converted to Balance of
Euro-dollar Eurodollar Respect Principal Base Rate C/D Rate Eurodollar Notation
Date Loans Loans Thereto Repaid Loans Loans Loans Made By
</TABLE>
<PAGE>95
Schedule C to 364-Day
Revolving Credit Note
C/D RATE LOANS
AND REPAYMENTS OF C/D RATE LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Unpaid
Period and C/D Amount Amount Principal
Amount Rate with Amount of Converted to Converted to Balance of
Amount of C/D Converted to Respect Principal Base Rate Eurodollar C/D Rate Notation
Date Rate Loans C/D Rate Loans Thereto Repaid Loans Loans Loans Made By
</TABLE>
<PAGE>96
EXHIBIT B-1
TO 364-DAY
CREDIT AGREEMENT
[FORM OF OPINION OF WILLKIE FARR & GALLAGHER]
February 23, 1994
To the Banks listed on Schedule I
hereto and to the Agents
referred to below
Dear Sirs:
We have acted as counsel to Loral Corporation (the "Company") in
connection with the preparation, negotiation, execution and delivery of the
following documents:
(a) the 364-Day Revolving Credit Agreement dated as of February 23,
1994 (the "Credit Agreement") among the Company, the banks from time to
time party thereto (the "Banks"), Morgan Guaranty Trust Company of New
York, as documentation agent for the Banks (the "Documentation Agent"),
Chemical Bank, as administrative agent for the Banks (the "Administrative
Agent"), and Barclays Bank PLC and Continental Bank, N.A., as agents for
the Banks (along with the Administrative Agent and the Documentation Agent,
the "Agents"); and
(b) the Notes of the Company, dated the date hereof (the "Notes").
This opinion is furnished to you pursuant to Section 4.1(b) of the
Credit Agreement. Terms used herein which are defined in the Credit Agreement
shall have the respective meanings set forth in the Credit Agreement, unless
otherwise defined herein.
In connection with this opinion, we have made such examinations of law
and inquiries of officers of the Company and have examined certificates of
public officials, execution copies of the Credit Agreement and the Notes and
such corporate documents and records of the Company and certificates of public
officials and officers of the Company, and such other documents, as we have
deemed necessary or appropriate for the purposes of this opinion. In such
examination, we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals and the conformity to authentic
original documents of all documents submitted to us as certified, conformed or
photostatic copies. As to various questions of fact
<PAGE>97
material to this opinion, we have relied upon the certifications,
representations and warranties of officers and representatives of the Company
and upon the representations and warranties of the Company set forth in the
Credit Agreement.
As used herein, "Indentures" is the collective reference to the 9-1/8%
Indenture, the 7% Indenture and the 8-3/8% Indenture.
A. Based upon and subject to the foregoing, we are of the opinion that:
1. The Company (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, (b) has the
corporate power and authority to own and operate its property and to conduct its
business in the manner in which it is currently conducted, and (c) is duly
qualified as a foreign corporation and in good standing under the laws of New
York, Arizona, California, Washington, D.C., Florida, Maryland, Ohio and
Virginia.
2. The Company has the corporate power and authority to execute, make
and deliver the Credit Agreement and the Notes and to borrow and perform its
obligations under the Credit Agreement and Notes. The Company has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Agreement and the Notes and the borrowings contemplated by the
Credit Agreement. No consent or authorization of, or filing with, any person
pursuant to the Indentures or any Governmental Authority, is required by the
Company or any Subsidiary in connection with the execution, delivery and
performance, validity or enforceability of the Credit Agreement and the Notes
and the borrowings contemplated by the Credit Agreement except for filings which
are contemplated by the Credit Agreement, and filings of UCC financing
statements, if any, necessary in connection with the cash collateralization
contemplated by Section 2.6 of the Credit Agreement.
3. The Credit Agreement and Notes have been duly authorized,
executed and delivered by the Company. Each of the Credit Agreement
and the Notes constitutes a legal, valid and binding obligation
of the Company enforceable against the Company in accordance
with their respective terms, except as provided in
paragraph B hereof (other than paragraph B(3)) and except that we express no
opinion as to the enforceability of the last sentence of Section 9.7(a) or
Section 9.7(b), to the extent that it purports to grant to any Bank set-off
rights with respect to any amounts owed by the Company under the Credit
Agreement or the Notes to any other Bank, and no opinion is expressed as to the
enforceability of Section 2.9(d) to the extent it purports to specify the rate
of interest payable after judgment, or as to any indemnity provision which
includes indemnities for environmental matters to the extent the same conflicts
with Section 107(e) of
<PAGE>98
CERCLA or any comparable provision of laws of the State of New York.
4. Subject to the qualifications set forth in this paragraph, the
execution, delivery and performance by the Company of the Credit Agreement and
the Notes and the borrowings contemplated by the Credit Agreement will not
violate the restated certificate of incorporation or bylaws of the Company, any
law, rule or regulation of the State of New York or the United States of America
or the General Corporation Law of the State of Delaware or any judgment, decree
or order known to us of any court or governmental or regulatory authority (each
of which is an "Order of Law") or any provision of the Indentures and will not
result in the creation or imposition of any Lien on any of the properties or
revenues of the Company pursuant to any such Order of Law or any provision of
the Indentures. We express no opinion, however, as to any law, rule or
regulation (i) the existence or absence of which does not have any material
adverse effect on the Agents or the Banks and does not deprive the Agents or the
Banks of any material benefit under the Credit Agreement and the Notes, (ii)
which violation or Lien can be readily cured without significant delay or
expense to the Agents or the Banks, without loss to the Agents or the Banks of
any material benefit under the Credit Agreement and the Notes, and without any
material adverse effect on the Agents or the Banks during the period of such
violation or Lien, or (iii) any violation of law, rule or regulation which
results from the status of the Agents or the Banks or facts relating
specifically to the Agents or the Banks.
5. To the best of our knowledge, except as may be described in the
Credit Agreement or in the Company's Form 10-K for the year ended March 31,
1993, no litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or threatened by or against the Company or any
Subsidiary or against any of their respective properties or revenues (a) with
respect to the Credit Agreement and the Notes, or the performance by the Company
of its obligations thereunder, or (b) which, we have been advised by the
officers of the Company, could reasonably be expected to have a material adverse
effect on the business, property or financial condition of the Company and its
Subsidiaries taken as a whole.
6. The Company is not an "investment company" or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
B. The opinions expressed herein, however, are subject
to the following:
1. We are members of the Bar of the State of New York and do not
purport to be experts in the laws of jurisdictions other than the State of New
York, the General Corporation Law of the State of Delaware and the Federal laws
of the United States
<PAGE>99
of America and we do not express any opinion as to the laws of any jurisdiction
other than the present laws of the State of New York, the General Corporation
Law of the State of Delaware and federal laws of the United States, in each case
of the type typically applicable to transactions of the type contemplated by the
Credit Agreement and the Notes, and the present judicial interpretations thereof
and to the facts as they presently exist.
2. The opinions set forth in Paragraph A, insofar as they relate to
the enforceability of the Credit Agreement and the Notes, are subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting or limiting the enforcement of creditors' rights generally and to
equitable principles affecting the availability of equitable relief (regardless
of whether enforcement is considered in a proceeding in equity or at law),
including principles of commercial reasonableness or conscionability and an
implied covenant of good faith and fair dealing. Such principles of equity are
of general application, and in applying such principles, a court, among other
things, might not allow a creditor to accelerate the maturity of a debt for an
immaterial default. Such principles applied by a court might include a
requirement that a creditor act with reasonableness and good faith. Such
requirement might be applied, for example, to any provision of the Credit
Agreement and the Notes purporting to authorize conclusive determinations by any
Bank or any Agent. Insofar as provisions contained in the Credit Agreement
provide for indemnification, the enforcement thereof may be limited by public
policy considerations.
3. We have made no independent investigations except as specifically
set forth herein.
4. We express no opinion as to the effect of the law of any
jurisdiction other than the State of New York wherein any Bank or any Agent (or
any assignee of any of the rights and/or obligations of any Bank or any Agent
under the Credit Agreement and the Notes) may be located or wherein enforcement
of the Credit Agreement and the Notes may be sought which limits the rates of
interest legally chargeable or collectible.
5. We express no opinion as to (i) whether a Federal or state court
outside of the State of New York would give effect to the choice of New York law
provided for in the Credit Agreement and the Notes, (ii) sections of the Credit
Agreement insofar as such sections relate to the subject matter jurisdiction of
the courts specified therein to adjudicate any controversy related to such
Credit Agreement and the Notes, (iii) sections of the Credit Agreement insofar
as such sections relate to the waiver of trial by jury or (iv) the waiver of
defenses and the waiver of objection to venue set forth in the Credit Agreement
with respect to proceedings in the courts specified therein.
<PAGE>100
6. We have assumed that all parties other than the Company have duly
authorized, executed and delivered the Credit Agreement.
7. We have assumed that you, as well as all other parties other than
the Company, have all requisite corporate power and authority and have taken all
necessary action to consummate the transactions contemplated by the Credit
Agreement.
8. This opinion has been issued solely for the benefit of the Agents
and the Banks and no one else has the right to rely upon it. We further advise
you that we are not assuming any obligation to notify the Agents or the Banks of
any changes in this opinion as a result of any facts that may come to our
attention in the future which may cause a change in this opinion.
9. This opinion is limited to matters expressly set forth herein and
no opinion is to be implied or may be inferred beyond the matters expressly
stated herein.
Very truly yours,
WILLKIE FARR & GALLAGHER
By:
A Member of the Firm
<PAGE>101
EXHIBIT B-2
TO 364-DAY
CREDIT AGREEMENT
[FORM OF OPINION OF GENERAL COUNSEL]
February 23, 1994
To the Banks listed on Schedule I
hereto and to the Agents
referred to below
Dear Sirs:
I am Vice President, Assistant Secretary and General Counsel of Loral
Corporation (the "Company") and have acted as such in connection with the
preparation, negotiation, execution and delivery of the following documents:
(a) the 364-Day Revolving Credit Agreement dated as of February 23,
1994 (the "Credit Agreement") among the Company, the banks from time to
time party thereto (the "Banks"), Morgan Guaranty Trust Company of New
York, as documentation agent for the Banks (the "Documentation Agent"),
Chemical Bank, as administrative agent for the Banks (the "Administrative
Agent"), and Barclays Bank PLC and Continental Bank, N.A., as agents for
the Banks (along with the Administrative Agent and the Documentation Agent,
the "Agents"); and
(b) the Notes of the Company, dated the date hereof (the "Notes").
This opinion is furnished to you pursuant to Section 4.1(b) of the
Credit Agreement. Terms used herein which are defined in the Credit Agreement
shall have the respective meanings set forth in the Credit Agreement, unless
otherwise defined herein.
In connection with this opinion, I have made such examinations of law
and have examined executed copies of the Credit Agreement and the Notes and such
corporate documents and records of the Company and its Subsidiaries and
certificates of public officials and officers of the Company and its
Subsidiaries, and such other documents, as I have deemed necessary or
appropriate for the purposes of this opinion. In such examination, I have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to me as originals and the conformity to authentic original documents
of
<PAGE>102
all documents submitted to me as certified, conformed or photostatic copies. As
to various questions of fact material to this opinion, I have relied upon
certifications of officers and representatives of the Company and upon the
representations of the Company set forth in the Credit Agreement.
A. Based upon and subject to the foregoing, I am of the opinion
that:
1. Each of the Company and each Subsidiary (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its incorporation, (b) has the corporate power and authority to own and
operate its property and to conduct its business in the manner in which it
proposes to do so, and (c) is duly qualified as a foreign corporation and
in good standing under the laws of each jurisdiction where its ownership of
property or the conduct or proposed conduct of its business requires such
qualification, except to the extent that the failure to so qualify could
not reasonably be expected to have a material adverse effect on the
business, operations, property or financial or other condition of the
Company.
2. The Company has the corporate power and authority to execute,
make and deliver the Credit Agreement and the Notes and to borrow and
perform its obligations under the Credit Agreement and Notes. The Company
has taken all necessary corporate action to authorize the execution,
delivery and performance of the Credit Agreement and the Notes and the
borrowings contemplated by the Credit Agreement.
3. The Credit Agreement and Notes have been duly authorized,
executed and delivered by the Company. Each of the Credit Agreement and
the Notes constitutes a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with their respective terms,
except as provided in paragraph B hereof and except that I express no
opinion as to the enforceability of the last sentence of Section 9.7(a) or
Section 9.7(b), to the extent that it purports to grant to any Bank set-off
rights with respect to any amounts owed by the Company under the Credit
Agreement or the Notes to any other Bank, and no opinion is expressed as to
the enforceability of Section 2.9(d) to the extent it purports to specify
the rate of interest payable after judgment, or as to any indemnity
provision which includes indemnities for environmental matters to the
extent the same conflicts with Section 107(e)
<PAGE>103
of CERCLA or any comparable provision of laws of the State of New York.
4. No consent or authorization of, or filing with, any Governmental
Authority or any other Person is required by the Company or any of its
Subsidiaries in connection with the execution, delivery and performance,
validity or enforceability of the Credit Agreement and the Notes and the
borrowings contemplated by the Credit Agreement, except for filings which
are contemplated by the Credit Agreement, and filings of UCC financing
statements, if any, necessary in connection with the cash collateralization
contemplated by Section 2.6 of the Credit Agreement. I express no opinion,
however, as to any such consent, authorization, filing or act (i) the
existence or absence of which does not have any material adverse effect on
the Agents or the Banks and does not deprive the Agents or the Banks of any
material benefit under the Credit Agreement and the Notes or (ii) which can
be readily cured or obtained without significant delay or expense to the
Agents or the Banks, without loss to the Agents or the Banks of any
material benefit under the Credit Agreement and the Notes and without any
material adverse effect on the Agents or the Banks during the period in
which such consent, authorization, filing or act was not obtained or
effected.
5. Subject to the qualifications set forth in this paragraph, the
execution, delivery and performance by the Company of the Credit Agreement
and the Notes and the borrowings contemplated by the Credit Agreement will
not violate the certificate of incorporation, bylaws or other
organizational documents of the Company or any Subsidiary, any law, rule or
regulation of the State of New York or the United States of America or the
General Corporation Law of the State of Delaware or any judgment, decree or
order known to me of any court or governmental or regulatory authority
(each of which is an "Order of Law") or any Contractual Obligation of the
Company or its Subsidiaries, and will not result in the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any such Order of Law or Contractual Obligation. I express no
opinion, however, as to any law, rule or regulation (i) the existence or
absence of which does not have any material adverse effect on the Agents or
the Banks and does not deprive the Agents or the Banks of any material
benefit under the Credit Agreement and the Notes, (ii) which violation or
Lien can be readily cured without significant delay or expense to the
Agents or the Banks, without loss to
<PAGE>104
the Agents or the Banks of any material benefit under the Credit Agreement
and the Notes and without any material adverse effect on the Agents or the
Banks during the period of such violation or Lien, or (iii) any violation
of law, rule or regulation which results from the Agents' or the Banks'
status or facts relating specifically to the Agents or the Banks.
6. To the best of my knowledge, except as may be described in the
Credit Agreement or in the Company's Form 10-K for the year ended March 31,
1993, no litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or threatened by or against
the Company or any Subsidiary or against any of its respective properties
or revenues (a) with respect to the Credit Agreement and the Notes, or the
performance by the Company of its obligations thereunder, or (b) which
could reasonably be expected to have a material adverse effect on the
business, property or financial condition of the Company and its
Subsidiaries taken as a whole.
B. The opinions expressed herein, however, are subject to the
following:
1. I am a member of the Bar of the District of Columbia and do not
purport to be an expert in the laws of jurisdictions other than the
District of Columbia, the General Corporation Law of the State of Delaware
and the Federal laws of the United States of America and I do not express
any opinion as to the laws of any jurisdiction other than the present laws
of the District of Columbia, the State of New York (subject to the
qualification stated below), the General Corporation Law of the State of
Delaware and federal laws of the United States, in each case of the type
typically applicable to transactions of the type contemplated by the Credit
Agreement and the Notes, and the present judicial interpretations thereof
and to the facts as they presently exist. I am not admitted to the Bar of
the State of New York. As to any opinion as to the laws of the State of
New York, I have relied solely on the opinion dated today, a copy of which
is being delivered to you, of Michael B. Targoff, Esq., Senior Vice
President, Secretary and former General Counsel of the Company.
2. The opinions set forth in Paragraph A, insofar as they relate to
the enforceability of the Credit Agreement and the Notes, are subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar
laws
<PAGE>105
affecting or limiting the enforcement of creditors' rights generally and to
equitable principles affecting the availability of equitable relief
(regardless of whether enforcement is considered in a proceeding in equity
or at law), including principles of commercial reasonableness or
conscionability and an implied covenant of good faith and fair dealing.
Such principles of equity are of general application, and in applying such
principles, a court, among other things, might not allow a creditor to
accelerate the maturity of a debt for an immaterial default. Such
principles applied by a court might include a requirement that a creditor
act with reasonableness and good faith. Such requirement might be applied,
for example, to any provision of the Credit Agreement and the Notes
purporting to authorize conclusive determinations by any Bank or any Agent.
Insofar as provisions contained in the Credit Agreement provide for
indemnification, the enforcement thereof may be limited by public policy
considerations.
3. I express no opinion as to the effect of the law of any
jurisdiction other than the State of New York wherein any Bank or any Agent
(or any assignee of any of the rights and/or obligations of any Bank or any
Agent under the Credit Agreement and the Notes) may be located or wherein
enforcement of the Credit Agreement and the Notes may be sought which
limits the rates of interest legally chargeable or collectible.
4. I express no opinion as to (i) whether a Federal or state court
outside of the State of New York would give effect to the choice of New
York law provided for in the Credit Agreement and the Notes, (ii) sections
of the Credit Agreement and the Notes insofar as such sections relate to
the subject matter jurisdiction of the courts specified therein to
adjudicate any controversy related to such Credit Agreement and the Notes,
(iii) sections of the Credit Agreement insofar as such sections relate to
the waiver of trial by jury or (iv) the waiver of defenses and the waiver
of objection to venue set forth in the Credit Agreement with respect to
proceedings in the courts specified therein.
5. I have assumed that all parties other than the Company have duly
authorized, executed and delivered the Credit Agreement.
6. I have assumed that you, as well as all other parties other than
the Company, have all requisite corporate power and authority and have
taken all necessary action to
<PAGE>106
consummate the transactions contemplated by the Credit Agreement.
7. This opinion is limited to matters expressly set forth herein and
no opinion is to be implied or may be inferred beyond the matters expressly
stated herein.
This opinion has been issued solely for the benefit of the Agents and
the Banks and no one else has the right to rely upon it. I further advise you
that I am not assuming any obligation to notify the Agents or the Banks of any
changes in this opinion as a result of any facts that may come to my attention
in the future which may cause a change in this opinion.
Very truly yours,
Eric J. Zahler
General Counsel
<PAGE>107
EXHIBIT C
TO 364-DAY
CREDIT AGREEMENT
[FORM OF CLOSING CERTIFICATE]
CLOSING CERTIFICATE
Pursuant to Section 4.1(c) of the 364-Day Revolving Credit Agreement
(the "Credit Agreement"; capitalized terms are used herein as therein defined)
dated as of February 23, 1994 among Loral Corporation, a New York corporation
(the "Company"), the Banks parties thereto, Morgan Guaranty Trust Company of New
York, as Documentation Agent, Chemical Bank, as Administrative Agent, and
Barclays Bank PLC and Continental Bank, N.A., as Agents, the undersigned
Nicholas C. Moren, Vice President and Treasurer of the Company, hereby certifies
as follows:
1. The representations and warranties set forth in Section 3 of the
Credit Agreement or which are contained in any certificate, document or
financial or other statement furnished pursuant to or in connection with the
Credit Agreement are true and correct on and as of the date hereof with the same
effect as if made on the date hereof;
2. Immediately prior to and immediately after the making of the
Loans requested to be made on the date hereof, no Default or Event of Default
will have occurred under the Credit Agreement; and
3. Eric J. Zahler is and at all times since July 28, 1992 has been
the duly elected and qualified Vice President, General Counsel and Assistant
Secretary of the Company and the signature set forth on the signature line of
such officer below is such officer's true and genuine signature; and the
undersigned Assistant Secretary of the Company hereby certifies as follows:
(a) There are no liquidation or dissolution proceedings pending or to
my knowledge threatened against the Company, nor has any other event
occurred affecting or threatening the corporate existence of the Company;
(b) The Company is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of New York;
(c) Attached hereto as Exhibit A is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Company on
January 25, 1994; such resolutions have not in any way been rescinded or
modified
<PAGE>108
and have been in full force and effect since their adoption to and
including the date hereof and are now in full force and effect; such
resolutions are the only corporate proceedings of the Company now in force
relating to or affecting the matters referred to therein; attached hereto
as Exhibit B is a true and complete copy of the By-laws of the Company as
in effect on the date such corporate resolutions were adopted through the
date hereof; and attached hereto as Exhibit C is a true and complete copy
of the Amended and Restated Certificate of Incorporation of the Company as
in effect on the date such corporate resolutions were adopted through the
date hereof; and
(d) The persons listed on Schedule I hereto are now duly elected and
qualified officers of the Company, holding the offices indicated next to
their respective names, and such officers have held such offices with the
Company at all times since November 10, 1992 to and including the date
hereof, and the signatures appearing opposite their respective names are
copies of the true and genuine signatures of such officers, and each of
such officers is duly authorized to execute and deliver on behalf of the
Company the Credit Agreement and the Notes of the Company to be issued
pursuant thereto.
IN WITNESS WHEREOF, the undersigned have hereunto set
our names.
Title: Vice President Title: Vice President,
Treasurer General Counsel
and Assistant
Secretary
Date: February 23, 1994
<PAGE>109
EXHIBIT D
TO 364-DAY
CREDIT AGREEMENT
[FORM OF COMMITMENT TRANSFER SUPPLEMENT]
COMMITMENT TRANSFER SUPPLEMENT
COMMITMENT TRANSFER SUPPLEMENT, dated as of the date set forth in Item
1 of Schedule I hereto, among the Transferor Bank set forth in Item 2 of
Schedule I hereto (the "Transferor Bank"), each Purchasing Bank set forth in
Item 3 of Schedule I hereto (each, a "Purchasing Bank"), and CHEMICAL BANK, as
administrative agent for the Banks under the Credit Agreement described below
(in such capacity, the "Administrative Agent").
W I T N E S S E T H :
WHEREAS, this Commitment Transfer Supplement is being executed and
delivered in accordance with subsection 9.6(c) of the 364-Day Revolving Credit
Agreement, dated as of February 23, 1994, among Loral Corporation, a New York
corporation (the "Company"), the Transferor Bank, the other Banks party thereto,
Morgan Guaranty Trust Company of New York, as Documentation Agent thereunder,
the Administrative Agent, and Barclays Bank PLC and Continental Bank, N.A., as
Agents thereunder (as from time to time amended, supplemented or otherwise
modified in accordance with the terms thereof, the "Credit Agreement"; terms
defined therein being used herein as therein defined);
WHEREAS, each Purchasing Bank (if it is not already a Bank party to
the Credit Agreement) wishes to become a Bank party to the Credit Agreement; and
WHEREAS, the Transferor Bank is selling and assigning to each
Purchasing Bank, rights, obligations and commitments under the Credit Agreement;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Upon receipt by the Administrative Agent of five counterparts of
this Commitment Transfer Supplement, to each of which is attached a fully
completed Schedule I and Schedule II, and each of which has been executed by the
Transferor Bank and each Purchasing Bank (and any other Person required by the
Credit Agreement to execute this Commitment Transfer Supplement), the
Administrative Agent will transmit to the Company, the Transferor
<PAGE>110
Bank and each Purchasing Bank a Transfer Effective Notice, substantially in the
form of Schedule III to this Commitment Transfer Supplement (a "Transfer
Effective Notice"). Such Transfer Effective Notice shall set forth, inter alia,
the date on which the transfer effected by this Commitment Transfer Supplement
shall become effective (the "Transfer Effective Date"), which date shall be the
fifth Business Day following the date of such Transfer Effective Notice unless a
shorter period is agreed to by the Administrative Agent. From and after the
Transfer Effective Date each Purchasing Bank shall be a Bank party to the Credit
Agreement for all purposes thereof.
2. At or before 12:00 Noon, local time of the Transferor Bank, on
the Transfer Effective Date, each Purchasing Bank shall pay to the Transferor
Bank, in immediately available funds, an amount equal to the purchase price, as
agreed between the Transferor Bank and such Purchasing Bank (the "Purchase
Price"), of the portion being purchased by such Purchasing Bank (such Purchasing
Bank's "Purchased Percentage") of the outstanding Loans and other amounts owing
to the Transferor Bank under the Credit Agreement and the Notes. Effective upon
receipt by the Transferor Bank of the Purchase Price from a Purchasing Bank, the
Transferor Bank hereby irrevocably sells, assigns and transfers to such
Purchasing Bank, without recourse, representation or warranty, and each
Purchasing Bank hereby irrevocably purchases, takes and assumes from the
Transferor Bank, such Purchasing Bank's Purchased Percentage of the Commitments
and the presently outstanding Loans and other amounts owing to the Transferor
Bank under the Credit Agreement and the Notes together with all instruments,
documents and collateral security pertaining thereto.
3. The Transferor Bank has made arrangements with each Purchasing
Bank with respect to (i) the portion, if any, to be paid, and the date or dates
for payment, by the Transferor Bank to such Purchasing Bank of any fees
heretofore received by the Transferor Bank pursuant to the Credit Agreement
prior to the Transfer Effective Date and (ii) the portion, if any, to be paid,
and the date or dates for payment, by such Purchasing Bank to the Transferor
Bank of fees or interest received by such Purchasing Bank pursuant to the Credit
Agreement from and after the Transfer Effective Date.
4. (a) All principal payments that would otherwise be payable from
and after the Transfer Effective Date to or for the account of the Transferor
Bank pursuant to the Credit Agreement and its Note shall, instead, be payable to
or for the account of the Transferor Bank and the Purchasing Banks, as the case
may be, in accordance with their respective interests as reflected in this
Commitment Transfer Supplement.
(b) All interest, fees and other amounts that would otherwise accrue
for the account of the Transferor Bank from and after the Transfer Effective
Date pursuant to the Credit
<PAGE>111
Agreement and its Note shall, instead, accrue for the account of, and be payable
to, the Transferor Bank and the Purchasing Banks, as the case may be, in
accordance with their respective interests as reflected in this Commitment
Transfer Supplement. In the event that any amount of interest, fees or other
amounts accruing prior to the Transfer Effective Date was included in the
Purchase Price paid by any Purchasing Bank, the Transferor Bank and each
Purchasing Bank will make appropriate arrangements for payment by the Transferor
Bank to such Purchasing Bank of such amount upon receipt thereof from the
Company.
5. On or prior to the Transfer Effective Date, the Transferor Bank
will deliver to the Administrative Agent its Note. On or prior to the Transfer
Effective Date, the Company will deliver to the Administrative Agent Notes for
each Purchasing Bank and the Transferor Bank, in each case in principal amounts
reflecting, in accordance with the Credit Agreement, their Commitments (as
adjusted pursuant to this Commitment Transfer Supplement). As provided in
subsection 9.6(c) of the Credit Agreement, each such new Note shall be dated the
Closing Date. Promptly after the Transfer Effective Date, the Administrative
Agent will send to each of the Transferor Bank and the Purchasing Banks its new
Note, along with a schedule setting forth the amounts of Loans outstanding for
the Transferor Bank and each Purchasing Bank, and will send to the Company the
superseded Note of the Transferor Bank, marked "Cancelled".
6. Concurrently with the execution and delivery hereof, the
Transferor Bank will provide to each Purchasing Bank (if it is not already a
Bank party to the Credit Agreement) conformed copies of all documents delivered
to such Transferor Bank on the Closing Date in satisfaction of the conditions
precedent set forth in the Credit Agreement.
7. Each of the parties to this Commitment Transfer Supplement agrees
that at any time and from time to time upon the written request of any other
party, it will execute and deliver such further documents and do such further
acts and things as such other party may reasonably request in order to effect
the purposes of this Commitment Transfer Supplement.
8. By executing and delivering this Commitment Transfer Supplement,
the Transferor Bank and each Purchasing Bank confirm to and agree with each
other and the Administrative Agent and the Banks as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned hereby free and clear of any adverse claim, the
Transferor Bank 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, the Notes or any other instrument or document furnished pursuant
thereto; (ii) the Transferor Bank makes no
<PAGE>112
representation or warranty and assumes no responsibility with respect to the
financial condition of the Company or the performance or observance by the
Company of any of its obligations under the Credit Agreement, the Notes or any
other instrument or document furnished pursuant hereto; (iii) each Purchasing
Bank confirms that it has received a copy of the Credit Agreement, together with
copies of the financial statements referred to in subsection 3.1, the financial
statements delivered pursuant to subsection 5.1, if any, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Commitment Transfer Supplement; (iv)
each Purchasing Bank will, independently and without reliance upon the
Administrative Agent, the Transferor Bank or any other Bank and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (v) each Purchasing Bank 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,
all in accordance with Section 8 of the Credit Agreement; and (vi) each
Purchasing Bank 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 Bank.
9. Each party hereto represents and warrants to and agrees with the
Administrative Agent that it is aware of and will comply with the provision of
subsection 9.6(g) of the Credit Agreement.
10. Schedule II hereto sets forth the revised Commitments and
Commitment Percentages of the Transferor Bank and each Purchasing Bank as well
as administrative information with respect to each Purchasing Bank.
11. THIS COMMITMENT TRANSFER SUPPLEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this Commitment
Transfer Supplement to be executed by their respective duly authorized officers
on Schedule I hereto as of the date set forth in Item 1 of Schedule I hereto.
<PAGE>113
SCHEDULE I
TO
COMMITMENT
TRANSFER
SUPPLEMENT
COMPLETION OF INFORMATION AND
SIGNATURES FOR COMMITMENT
TRANSFER SUPPLEMENT
Re: 364-Day Revolving Credit Agreement, dated as of
February 23, 1994, with Loral Corporation.
Item 1 (Date of Commitment [Insert date of Commitment
Transfer Supplement): Transfer Supplement]
Item 2 (Transferor Bank): [Insert name of Transferor
Bank]
Item 3 (Purchasing Bank[s]): [Insert name[s] of
Purchasing Bank[s]]
Item 4 (Signatures of Parties
to Commitment Transfer
Supplement):
, as
Transferor Bank
By
Title:
, as a
Purchasing Bank
By
Title:
, as a
Purchasing Bank
By
Title:
<PAGE>114
CONSENTED TO AND ACKNOWLEDGED:
LORAL CORPORATION
By
Title:
CHEMICAL BANK, as
Administrative Agent
By
Title:
[Consents Required only when
Purchasing Bank is not already
a Bank or Affiliate thereof]
ACCEPTED FOR RECORDATION
IN REGISTER:
CHEMICAL BANK, as
Administrative Agent
By
Title:
<PAGE>115
SCHEDULE II
TO COMMITMENT
TRANSFER
SUPPLEMENT
LIST OF LENDING OFFICES, ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
[Name of Transferor
Bank] Revised Commitment Amounts: $
Revised Commitment Percentage:
[Name of Purchasing
Bank] New Commitment Amounts: $
Address for Notices:
New Commitment Percentage:
[Address]
Attention:
Telex:
Answerback:
Telephone:
Telecopier:
Eurodollar Lending Office:
Domestic Lending Office:
<PAGE>116
SCHEDULE III
TO COMMITMENT
TRANSFER
SUPPLEMENT
[Form of Transfer Effective Notice]
To: Loral Corporation, [Transferor Bank
and each Purchasing Bank]
The undersigned, as Administrative Agent under the 364-Day Revolving
Credit Agreement, dated as of February 23, 1994, among Loral Corporation (the
"Company"), the Banks parties thereto, Morgan Guaranty Trust Company of New
York, as Documentation Agent, Chemical Bank, as Administrative Agent, and
Barclays Bank PLC and Continental Bank, N.A., as Agents, acknowledges receipt of
five executed counterparts of a completed Commitment Transfer Supplement, as
described in Schedule I hereto. [Note: attach copy of Schedule I from
Commitment Transfer Supplement.] Terms defined in such Commitment Transfer
Supplement are used herein as therein defined.
1. Pursuant to such Commitment Transfer Supplement, you are advised
that the Transfer Effective Date will be [Insert fifth business day
following date of Transfer Effective Notice or such shorter period, if any, as
is agreed to by the Administrative Agent]
2. Pursuant to such Commitment Transfer Supplement, the Transferor
Bank is required to deliver to the Administrative Agent on or before the
Transfer Effective Date its Note.
3. Pursuant to such Commitment Transfer Supplement, the Company is
required to deliver to the Administrative Agent on or before the Transfer
Effective Date the following Notes, each dated [Insert Closing
Date]
[Describe each new Note for Transferor Bank and Purchasing Bank as to
principal amount and payee.]
<PAGE>117
4. Pursuant to such Commitment Transfer Supplement each Purchasing
Bank is required to pay its Purchase Price to the Transferor Bank at or before
12:00 Noon on the Transfer Effective Date in immediately available funds.
Very truly yours,
CHEMICAL BANK, as
Administrative Agent
By
Title:
<PAGE>1
CONFORMED COPY
REVOLVING CREDIT AGREEMENT
among
LORAL CORPORATION,
CERTAIN BANKS,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Documentation Agent and Co-Arranger
CHEMICAL BANK,
as Administrative Agent and Co-Arranger
BARCLAYS BANK PLC,
as Agent
and
CONTINENTAL BANK, N.A.,
as Agent
Dated as of February 23, 1994
<PAGE>2
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . 16
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS . . . . . . . . . . . . . . . 16
2.1 Revolving Credit Commitments . . . . . . . . . . . . . . . . . . . 16
2.2 Revolving Credit Notes . . . . . . . . . . . . . . . . . . . . . . 17
2.3 Procedure for Revolving Credit Borrowing . . . . . . . . . . . . . 17
2.4 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . 18
(b) Upfront Fee . . . . . . . . . . . . . . . . . . . . . . . . . 18
(c) Other Fees . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.5 Termination or Reduction of Commitments . . . . . . . . . . . . . . 18
2.6 Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.7 Conversion and Continuation Options . . . . . . . . . . . . . . . . 20
2.8 Minimum Amounts of Tranches . . . . . . . . . . . . . . . . . . . . 21
2.9 Interest Rates and Payment Dates . . . . . . . . . . . . . . . . . 21
2.10 Computation of Interest and Fees . . . . . . . . . . . . . . . . . 22
2.11 Inability to Determine Interest Rate . . . . . . . . . . . . . . . 23
2.12 Pro Rata Treatment and Payments . . . . . . . . . . . . . . . . . . 23
2.13 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.14 Other Costs; Increased Costs . . . . . . . . . . . . . . . . . . . 25
2.15 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.16 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2.17 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . 30
3.1 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . 30
3.2 No Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.3 Corporate Existence; Compliance with Law . . . . . . . . . . . . . 30
3.4 Corporate Power; Authorization; Enforceable
Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.5 No Legal Bar . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.6 No Material Litigation . . . . . . . . . . . . . . . . . . . . . . 31
3.7 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.8 Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . 32
3.9 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.10 Federal Regulations . . . . . . . . . . . . . . . . . . . . . . . . 32
3.11 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.12 Investment Company Act; Other Regulations . . . . . . . . . . . . . 33
3.13 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.14 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . 33
3.15 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4 CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . 34
<PAGE>3
4.1 Conditions of Initial Loans . . . . . . . . . . . . . . . . . . . . 34
4.2 Conditions to all Loans . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . 37
5.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . 38
5.2 Certificates; Other Information . . . . . . . . . . . . . . . . . . 38
5.3 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . 39
5.4 Conduct of Business and Maintenance of Existence . . . . . . . . . 39
5.5 Maintenance of Property; Insurance . . . . . . . . . . . . . . . . 39
5.6 Inspection of Property; Books and Records; Discussions . . . . . . 40
5.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.8 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . 41
5.9 Ratings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . 42
6.1 Financial Condition Covenants . . . . . . . . . . . . . . . . . . . 42
6.2 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
6.3 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . 43
6.4 Limitation on Fundamental Changes . . . . . . . . . . . . . . . . . 44
6.5 Limitation on Restricted Payments . . . . . . . . . . . . . . . . . 45
6.6 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.7 Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.8 Sale and Leaseback . . . . . . . . . . . . . . . . . . . . . . . . 47
6.9 Corporate Documents . . . . . . . . . . . . . . . . . . . . . . . . 47
6.10 Restrictions on Subsidiaries. . . . . . . . . . . . . . . . . . . . 47
SECTION 7. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 8. THE AGENTS . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.1 Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.2 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . 52
8.3 Exculpatory Provisions . . . . . . . . . . . . . . . . . . . . . . 52
8.4 Reliance by Agents . . . . . . . . . . . . . . . . . . . . . . . . 52
8.5 Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.6 Non-Reliance on Agents and Other Banks . . . . . . . . . . . . . . 53
8.7 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . 53
8.8 Each Agent in Its Individual Capacity . . . . . . . . . . . . . . . 54
8.9 Successor Agents . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 9. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 55
9.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . 55
9.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
9.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . 57
9.4 Survival of Representations and Warranties . . . . . . . . . . . . 57
9.5 Payment of Expenses and Taxes . . . . . . . . . . . . . . . . . . . 57
9.6 Successors and Assigns; Participations; Purchasing
Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
9.7 Adjustments; Set-off . . . . . . . . . . . . . . . . . . . . . . . 61
9.8 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
<PAGE>4
9.9 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.10 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.11 Submission To Jurisdiction; Waivers . . . . . . . . . . . . . . . . 62
9.12 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . 63
9.13 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.14 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Schedules:
SCHEDULE I - Commitments and Commitment Percentages
SCHEDULE 3.1 - Certain Liabilities
SCHEDULE 3.13 - Certain Subsidiaries
SCHEDULE 6.4 - Existing Contractual Obligations
SCHEDULE 6.6 - Certain Investments
Exhibits:
EXHIBIT A - Form of Note
EXHIBIT B-1 - Form of Opinion of Willkie Farr & Gallagher
EXHIBIT B-2 - Form of Opinion of General Counsel
EXHIBIT C - Form of Closing Certificate
EXHIBIT D - Form of Commitment Transfer Supplement
<PAGE>5
REVOLVING CREDIT AGREEMENT dated as of February 23, 1994 among LORAL
CORPORATION, a New York corporation (the "Company"), the several financial
institutions parties from time to time to this Agreement (collectively, the
"Banks"; individually, a "Bank"), MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
a New York banking corporation ("Morgan"), as documentation agent for the
Banks hereunder (in such capacity, the "Documentation Agent") and co-arranger
(each of Morgan and Chemical in such capacity is a "Co-Arranger"), CHEMICAL
BANK, a New York banking corporation ("Chemical"), as administrative agent for
the Banks hereunder (in such capacity, the "Administrative Agent") and as Co-
Arranger, BARCLAYS BANK PLC, a banking corporation organized under the laws of
England ("Barclays"), and CONTINENTAL BANK, N.A., a national banking
corporation ("Continental"), as agents for the Banks hereunder (each of
Barclays and Continental in such capacity is an "Agent" and, collectively with
the Administrative Agent and the Documentation Agent, the "Agents").
W I T N E S S E T H :
WHEREAS, the Company has requested the Banks to make revolving
credit loans to the Company in an aggregate principal amount not to exceed
$1,200,000,000 at any time outstanding, the proceeds of which may be used for
general corporate purposes; and
WHEREAS, the Banks are willing to make such Loans to the Company
upon the terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms
have the following meanings:
"Affiliate": with respect to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, a
Person shall be deemed to be "controlled by" any other Person which
possesses, directly or indirectly, power either to (i) vote 10% or more
of the securities having ordinary voting power for the election of
directors of such Person or (ii) direct or cause the direction of the
management and policies of such Person whether by contract or otherwise.
<PAGE>6
"Agreement": this Revolving Credit Agreement, as amended,
supplemented or modified from time to time.
"Applicable Margin": with respect to each day (a) for each
Eurodollar Loan and C/D Rate Loan when the Ratings are as set forth
below, the rate per annum set forth below opposite such Ratings:
Applicable Applicable
Ratings Eurodollar C/D Rate
Moody's S&P Margin Margin
A2 A 0.3500% 0.4750%
A3 A- 0.3750% 0.5000%
Baa1 BBB+ 0.4500% 0.5750%
Baa2 BBB 0.5250% 0.6500%
Baa3 BBB- 0.6250% 0.7500%
Any other 0.7500% 0.8750%
Rating lower than
those set forth above
; and (b) for each Base Rate Loan, 0% (unless either Rating shall be
lower than Baa3 or BBB-, in which case the Applicable Margin for such
Base Rate Loan shall be 0.25%); provided, that if the Ratings are split,
the Applicable Margin shall be the one applicable to the lower Rating;
and provided further, that if the Loans or the Commitments shall be
designated a "highly leveraged transaction" by any applicable bank
regulator or by the Administrative Agent (if directed to do so by any
applicable Governmental Authority or if required to do so pursuant to
rules, regulations or interpretations promulgated by any applicable
Governmental Authority), in either case employing a definition of "highly
leveraged transaction" no more inclusive than the definition in effect
prior to June 30, 1992, the Administrative Agent shall so notify the
Banks and the Company and, on and after the date of such notification,
the Applicable Margin shall be 2.5%, 2.625% and 1.5% for each Eurodollar
Loan, C/D Rate Loan and Base Rate Loan, respectively.
"Available Commitment": as to any Bank, at a particular time, an
amount equal to such Bank's Commitment Percentage of the excess, if any,
of (a) the aggregate Commitments at such time over (b) the aggregate
outstanding principal amount of the Loans at such time; collectively, as
to all the Banks, the "Available Commitments".
"Base Rate": at a particular date, the higher of (a) the rate of
interest publicly announced by the
<PAGE>7
Administrative Agent in New York, New York from time to time as its
reference rate and (b) 1/2 of 1% above the rate set forth for such date
opposite the caption "Federal Funds (Effective)" in the weekly
statistical release designated as "H.15(519)", or any successor
publication, published by the Board of Governors of the Federal Reserve
System. The reference rate is not intended to be the lowest rate of
interest charged by the Administrative Agent in connection with
extensions of credit to debtors.
"Base Rate Loans": Loans hereunder at such time as they are made
and/or being maintained at a rate of interest based upon the Base Rate.
"Borrowing Date": any day specified by the Company in a notice
pursuant to Section 2.3 as a date on which the Company requests the Banks
to make Loans hereunder.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law
to close.
"Cash Collateral": as defined in Section 2.6(c).
"Cash Collateral Account": as defined in Section 2.6(c).
"Cash Equivalents": (i) securities issued or directly and fully
guaranteed or insured by the United States Government or any agency or
instrumentality thereof having maturities of not more than twelve months
from the date of acquisition, (ii) time deposits and certificates of
deposit of any Bank or any domestic commercial bank having capital and
surplus in excess of $500,000,000 the holding company of which has a
commercial paper rating meeting the requirements specified in clause (iv)
below having maturities of not more than twelve months from the date of
acquisition, (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses
(i) and (ii) entered into with any Bank or bank meeting the
qualifications specified in clause (ii) above, (iv) commercial paper
rated at least A-1 or the equivalent thereof by S&P or P-1 or the
equivalent thereof by Moody's and in either case maturing within twelve
months after the date of acquisition, (v) tax exempt obligations rated at
least A2 or the equivalent thereof by Moody's and A or the equivalent
thereof by S&P, (vi) money market mutual funds, and (vii) commercial
paper (other than commercial paper referred to in the preceding clause
(iv)) rated at least A-2 or the equivalent thereof by S&P or P-2 or the
equivalent thereof by Moody's in an aggregate principal amount not in
excess of 25% of the liquid assets of the Company and its consolidated
Subsidiaries and in either case maturing within twelve months after the
date of acquisition.
<PAGE>8
"C/D Assessment Rate": for any day as applied to any C/D Rate Loan,
the net annual assessment rate (rounded upward to the nearest 1/100th of
1%) determined by the Administrative Agent to be payable on such day to
the Federal Deposit Insurance Corporation or any successor ("FDIC") for
FDIC's insuring time deposits made in Dollars at offices of the
Administrative Agent in the United States.
"C/D Base Rate": with respect to each day during each Interest
Period pertaining to a C/D Rate Loan, the rate of interest per annum
determined by the Administrative Agent to be the arithmetic average
(rounded upward to the nearest 1/100th of 1%) of the respective rates
notified to the Administrative Agent by each of the Reference Banks as
the average rate bid at 9:00 A.M., New York City time, or as soon
thereafter as practicable, on the first day of such Interest Period by a
total of three certificate of deposit dealers of recognized standing
selected by such Reference Bank for the purchase at face value from such
Reference Bank of its certificates of deposit in an amount comparable to
the C/D Rate Loan of such Reference Bank to which such Interest Period
applies and having a maturity comparable to such Interest Period.
"C/D Rate": with respect to each day during each Interest Period
pertaining to a C/D Rate Loan, a rate per annum determined for such day
in accordance with the following formula (rounded upward to the nearest
1/100th of 1%):
C/D Base Rate + C/D Assessment Rate
[DIVIDED BY]
1.00 - C/D Reserve Percentage
"C/D Rate Loans": Loans the rate of interest applicable to which is
based upon the C/D Rate.
"C/D Reserve Percentage": for any day as applied to any C/D Rate
Loan, that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal Reserve
System (or any successor), for determining the maximum reserve
requirement for a member bank of the Federal Reserve System in New York
City with deposits exceeding one billion Dollars in respect of new non-
personal time deposits in Dollars in New York City having a maturity
comparable to the Interest Period for such C/D Rate Loan and in an amount
of $100,000 or more.
"Change in Control": an event or series of events as a result of
which (i) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"))
is or becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act) of shares entitling the holder thereof to cast
more than 30% of the votes for the election
<PAGE>9
of directors of the Company; or (ii) at any time Continuing Directors do
not constitute a majority of the Board of Directors of the Company.
"Closing Date": February 23, 1994.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment": as to any Bank, its obligation to make Loans to the
Company in an aggregate principal amount not to exceed at any one time
outstanding the amount set forth opposite such Bank's name in Schedule I
hereto, as such amount may be reduced from time to time as provided
herein; collectively, as to all the Banks, the "Commitments".
"Commitment Fee Rate": with respect to each day when the Ratings
are as set forth below, the rate per annum set forth below opposite such
Ratings:
Ratings
Moody's S&P Commitment Fee Rate
A2 A 0.1250%
A3 A- 0.1500%
Baa1 BBB+ 0.1875%
Baa2 BBB 0.2000%
Baa3 BBB- 0.2250%
Any other Rating 0.3000%
lower than those
set forth above
; provided, that if the Ratings are split, the Commitment Fee Rate shall
be the one applicable to the lower Rating; and provided further, that if
the Loans or the Commitments shall be designated a "highly leveraged
transaction" by any applicable bank regulator or by the Administrative
Agent (if directed to do so by any applicable Governmental Authority or
if required to do so pursuant to rules, regulations or interpretations
promulgated by any applicable Governmental Authority), in either case
employing a definition of "highly leveraged transaction" no more
inclusive than the definition in effect prior to June 30, 1992, the
Administrative Agent shall so notify the Banks and the Company and, on
and after the date of such notification, the Commitment Fee Rate shall be
0.5000%.
<PAGE>10
"Commitment Percentage": as to any Bank, the percentage of the
aggregate Commitments constituted by such Bank's Commitment.
"Commitment Period": the period from and including the date hereof
to but not including the Termination Date.
"Commitment Transfer Supplement": a Commitment Transfer Supplement,
substantially in the form of Exhibit D.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Company within the
meaning of Section 4001 of ERISA or is part of a group which includes the
Company and which is treated as a single employer under Section 414 of
the Code.
"Consolidated Net Income": for any period, the consolidated net
income (or deficit) of the Company and its Subsidiaries for such period
(taken as a cumulative whole), determined in accordance with GAAP.
"Consolidated Net Worth": at a particular date, all amounts which
would be included under shareholders' equity on a consolidated balance
sheet of the Company and its Subsidiaries determined on a consolidated
basis in accordance with GAAP as at such date.
"Contingent Obligation": as to any Person, any obligation of such
Person guaranteeing or in effect guaranteeing any Indebtedness, leases,
dividends or other obligations quantified in accordance with the last
sentence of this definition (the "primary obligations") of any other
Person (the "primary obligor"), other than a Wholly Owned Subsidiary, in
any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent (a)
to purchase any such primary obligation or any property constituting
direct or indirect security therefor, (b) to advance or supply funds (i)
for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor,
(c) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation
or (d) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the
term Contingent Obligation shall not include (i) endorsements of
instruments for deposit or collection in the ordinary course of business
and (ii) performance guarantees by the Company made in the ordinary
course of business of contracts entered into by SSL. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated
or
<PAGE>11
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the
amount reasonably anticipated to be payable by the Company in respect of
such Contingent Obligation as determined by the Company in good faith.
"Continuing Director": at any date a member of the Company's Board
of Directors who was a member of such Board 12 months prior to such date.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Customer Advances": at any time, advances and prepayments received
by the Company or any Subsidiary pursuant to written contracts in the
ordinary course of business less costs incurred by the Company or any
Subsidiary in the performance of such contracts.
"Default": any of the events specified in Section 7, whether or not
any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"Dollars" and "$": dollars in lawful currency of the United States
of America.
"Domestic Dollar Loans": the collective reference to C/D Rate Loans
and Base Rate Loans.
"Domestic Lending Office": initially, the office of each Bank
designated as such in Schedule I; thereafter, such other office of such
Bank, if any, located within the United States which shall be making or
maintaining Base Rate Loans or C/D Rate Loans.
"Effective Date": the first date on which this Agreement shall have
been signed by a duly authorized officer of each of the Company, the
Agents and each of the Banks whose name is set forth on the signature
pages hereto.
"8-3/8% Indenture": the Indenture dated as of November 1, 1992
between the Company and Nationsbank of Georgia, National Association, as
trustee, pursuant to which $100,000,000 aggregate principal amount of the
Company's Senior Debentures due January 15, 2023 were issued, as the same
may be amended, modified or supplemented.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees or requirements of any Governmental Authority regulating,
relating to or imposing
<PAGE>12
liability or standards of conduct concerning environmental protection
matters, including without limitation, Hazardous Materials, as now or may
at any time hereafter be in effect.
"Equity Issuance Proceeds": an amount equal to (a) the aggregate
cash proceeds (other than any such proceeds received from the issuance or
sale of capital stock to a Subsidiary or received from the issuance of
Redeemable Stock) received by the Company or any Subsidiary from such
issuance or sale, as the case may be, less fees and expenses, including
underwriter's discount, paid in connection with such issuance or sale, as
the case may be; (b) the principal amount of Indebtedness of the Company
that has been converted into or exchanged for capital stock (other than
capital stock issued to a Subsidiary and other than Redeemable Stock);
(c) the fair market value (as determined by the Board of Directors of the
Company in good faith) of any assets purchased by the Company or any of
its Wholly Owned Subsidiaries in exchange for the issuance of capital
stock of the Company (other than capital stock issued to a Subsidiary and
other than Redeemable Stock); and (d) if the Company issues capital stock
to any 401(k) plan of the Company in satisfaction of its obligation to
make contributions thereto, the amount of the contribution satisfied.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurodollar Business Day": any Business Day on which dealings in
foreign currencies and exchange between banks may be carried on in
London, England.
"Eurodollar Lending Office": initially, the office of each Bank
designated as such in Schedule I; thereafter, such other office of such
Bank, if any, which shall be making or maintaining Eurodollar Loans.
"Eurodollar Loans": Loans hereunder at such time as they are made
and/or being maintained at a rate of interest based upon the Eurodollar
Rate.
"Eurodollar Rate": with respect to the Interest Period pertaining
to a Eurodollar Loan, the rate per annum equal to the average (rounded
upwards to the nearest whole multiple of 1/100th of 1%) of the respective
rates notified to the Administrative Agent by the Reference Banks as the
rate at which each of their Eurodollar Lending Offices is offered Dollar
deposits two Eurodollar Business Days prior to the beginning of such
Interest Period in the interbank eurodollar market where the eurodollar
and foreign currency and exchange operations of such Eurodollar Lending
Office are customarily conducted at or about 10:00 A.M., New York City
time, for delivery on the first day of such Interest
<PAGE>13
Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Loan of such Reference Bank to
which such Interest Period applies.
"Event of Default": any of the events specified in Section 7;
provided, that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, event or act has been satisfied.
"Excluded Employee Loans": loans or advances to directors, officers
or employees of the Company or any Wholly Owned Subsidiary the principal
amount of which, when added to the principal amount of existing such
loans or advances, would not exceed $5,000,000.
"Federal Systems": the Federal Systems business of the
International Business Machines Corporation ("IBM") which will be
acquired by the Company under the Asset Purchase Agreement dated as of
December 12, 1993 between the Company and IBM, as amended, modified or
supplemented from time to time.
"Financing Lease": (a) any lease of property, real or personal, the
then present value of the minimum rental commitment thereunder of which
should, in accordance with GAAP, be capitalized on a balance sheet of the
lessee, and (b) any other such lease the obligations under which are
capitalized on a consolidated balance sheet of the Company and its
Subsidiaries.
"Funded Debt": of a Person, at a particular date, the sum (without
duplication) at such date of (a) all indebtedness of such Person (i) for
borrowed money or (ii) for the deferred purchase price of property or
services or (iii) which is evidenced by a note, bond, debenture or
similar instrument, and (b) all obligations under Financing Leases.
"GAAP": generally accepted accounting principles in the United
States of America in effect from time to time.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Hazardous Materials": any hazardous materials, hazardous wastes,
hazardous constituents, hazardous or toxic substances, and petroleum
products (including crude oil or any fraction thereof), defined or
regulated as such in or under any Environmental Law.
<PAGE>14
"Historical Dividends": annual cash dividends on the Company's
common stock in an amount per share not exceeding the amount per share
paid in respect of the Company's common stock for the fiscal quarter
ended December 31, 1993, calculated on an annualized basis; provided,
that in each year beginning in fiscal year 1994 "Historical Dividends"
shall be increased by an amount equal to 10% of Historical Dividends for
the previous year.
"Indebtedness": of a Person, at a particular date, the sum (without
duplication) at such date of (a) Funded Debt, (b) all obligations of such
Person in respect of letters of credit, acceptances, or similar
obligations issued or created for the account of such Person and (c) all
indebtedness or other liabilities secured by any Lien on any property
owned by such Person even though such Person has not assumed or otherwise
become liable for the payment thereof; but excluding any trade or other
account payable in the ordinary course of business (i) which is not
disputed or overdue for a period longer than the period in which such
Person customarily pays such account or (ii) under which the amount owed
is not in excess of $5,000,000.
"Insolvency" or "Insolvent": at any particular time, the condition
that a Multiemployer Plan is insolvent within the meaning of Section 4245
of ERISA.
"Interest Payment Date": (a) as to any Base Rate Loan, the last
day of each calendar month, (b) as to any Eurodollar Loan in respect of
which the Company has selected an Interest Period of one, two or three
months, and as to any C/D Rate Loan in respect of which the Company has
selected an Interest Period of 30, 60 or 90 days, the last day of such
Interest Period, and (c) as to any Eurodollar Loan or C/D Rate Loan
having an Interest Period of six months or 180 days, respectively, each
day which is three months or 90 days, respectively, after the first day
of such Interest Period and the last day of such Interest Period.
"Interest Period": (a) with respect to any Eurodollar Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such Eurodollar
Loan and ending one, two, three or six months thereafter, as
selected by the Company in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan
and ending one, two, three or six months thereafter, as selected by
the
<PAGE>15
Company by irrevocable notice to the Administrative Agent not less
than three Eurodollar Business Days prior to the last day of the
then current Interest Period with respect thereto;
(b) with respect to any C/D Rate Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such C/D Rate
Loan and ending 30, 60, 90 or 180 days thereafter, as selected by
the Company in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such C/D Rate Loan and
ending 30, 60, 90 or 180 days thereafter, as selected by the Company
by irrevocable notice to the Administrative Agent not less than one
Business Day prior to the last day of the then current Interest
Period with respect thereto;
and (c) with respect to any Base Rate Loan, the period commencing on the
borrowing or conversion date, as the case may be, with respect to such
Base Rate Loan and ending 30 days thereafter; provided, that all of the
foregoing provisions relating to Interest Periods are subject to the
following:
(a) if any Interest Period pertaining to a Eurodollar Loan
would otherwise end on a day that is not a Eurodollar Business Day,
such Interest Period shall be extended to the next succeeding
Eurodollar Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month in which
event such Interest Period shall end on the immediately preceding
Eurodollar Business Day;
(b) if any Interest Period pertaining to a C/D Rate Loan or
Base Rate Loan would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding
Business Day;
(c) any Interest Period that would otherwise extend beyond the
Termination Date shall end on the Termination Date;
(d) any Interest Period pertaining to a Eurodollar Loan that
begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurodollar Business Day of a calendar month; and
<PAGE>16
(e) the Company shall select Interest Periods so as not to
require a payment or prepayment of any Eurodollar Loan or C/D Rate
Loan during an Interest Period for such Loan.
"Investment": any advance, loan, extension of credit or capital
contribution to, or purchase of any stock, bonds, notes, debentures,
ownership interests or other securities of, or other investment in, any
Person.
"LAH": Loral Aerospace Holdings, Inc., a Delaware corporation.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference,
priority or other security agreement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any Financing Lease having
substantially the same economic effect as any of the foregoing.
"Loan": as defined in Section 2.1.
"Material Adverse Effect": a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or
prospects of the Company and its Subsidiaries taken as a whole and the
ability of the Company to perform its obligations under this Agreement or
the Notes, or (b) the validity or enforceability of this Agreement or any
of the Notes or the material rights or remedies of the Agents or the
Banks hereunder or thereunder.
"Moody's": Moody's Investors Service, Inc.
"Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"9-1/8% Indenture": the Indenture dated as of January 15, 1992
between the Company and Continental Bank, N.A., as trustee, pursuant
to which $100,000,000 aggregate principal amount of the Company's
Senior Debentures due February 1, 2022 were issued, as the same may
be amended, supplemented or modified.
"Notes": as defined in Section 2.2.
"Original Commitment": $1,200,000,000.
"Participants": as defined in Section 9.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
<PAGE>17
"Person": an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Plan": at any particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Company or a Commonly
Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Properties": as defined in Section 3.14.
"Purchasing Banks": as defined in Section 9.6(c).
"Rating": the senior unsecured debt rating of the Company (or its
status as unrated) from time to time in effect from S&P or Moody's, as
the case may be.
"Redeemable Stock": means any equity interest which, by its terms
(or by the terms of any security into which it is convertible or for
which it is exchangeable before the date which is 91 days after the
Termination Date), or upon the happening of any event, matures or is
mandatorily redeemable, in whole or in part, prior to the date which is
91 days after the Termination Date, or is, by its terms or upon the
happening of any event, redeemable at the option of the holder thereof,
in whole or in part, at any time prior to the date which is 91 days after
the Termination Date.
"Reference Banks": Chemical, Morgan and Barclays.
"Register": as defined in Section 9.6(d).
"Reorganization": at any particular time, the condition that a
Multiemployer Plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(b)
of ERISA or the regulations thereunder, other than those events as to
which the thirty day notice period is waived under subsections .13, .14,
.16, .18, .19 or .20 of PBGC Reg. 2615.
"Required Banks": at any date, Banks whose Commitments aggregate at
least 66-2/3% of the total Commitments or, if the Commitments have been
terminated, of the outstanding Loans.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents
of such Person, and any law, treaty, rule or regulation or determination
of an
<PAGE>18
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Responsible Officer": the Chairman, the President or any Senior
Vice President of the Company or, with respect to financial matters, the
chief financial officer of the Company.
"Restricted Payments": as defined in Section 6.5.
"7% Indenture": the Indenture dated as of November 1, 1992 between
the Company and Nationsbank of Georgia, as trustee, pursuant to which
$200,000,000 aggregate principal amount of the Company's Senior
Debentures due September 15, 2023 were issued, as the same may be
amended, supplemented or modified.
"S&P": Standard & Poor's Corporation.
"Single Employer Plan": any Plan which is covered by Title IV of
ERISA but which is not a Multiemployer Plan.
"SSL": Space Systems/Loral, Inc., a Delaware corporation.
"Stockholders Agreement": the Stockholders Agreement dated as of
November 13, 1992 by and among Loral Aerospace Corp., LAH, the Company,
Shearson Lehman Brothers Capital Partners II, L.P., Lehman Brothers
Merchant Banking Portfolio Partnership L.P., Lehman Brothers Offshore
Investment Partnership L.P. and Lehman Brothers Offshore Investment
Partnership-Japan L.P., as amended, supplemented or otherwise modified
from time to time.
"Subordinated Debt": any unsecured Indebtedness of the Company or
any of its Subsidiaries, no part of the principal of which is required to
be paid (whether by way of mandatory sinking fund, mandatory redemption
or mandatory prepayment or otherwise) prior to the date which is 30 days
after the Termination Date, and the payment of principal of and interest
on which, and the payment of any other obligations of the Company or such
Subsidiary to the holders of such Subordinated Debt, are subordinated to
the prior payment in full of the obligations and liabilities of the
Company hereunder (including, without limitation, obligations in respect
of post-petition interest).
"Subsidiary": as to any Person, a corporation, partnership or other
entity (a) of which shares of stock or other ownership interests having
ordinary voting power (other than stock or other ownership interests
having such power only by reason of the happening of a contingency) to
<PAGE>19
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly
through one or more intermediaries, or both, by such Person and (b) which
is consolidated on such Person's financial statements; provided, that SSL
shall be excluded from the definition of "Subsidiary". Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Company.
"Substantial Subsidiary": any Subsidiary of the Company if the book
value of such Subsidiary's assets (determined in accordance with GAAP for
the most recent fiscal quarter for which financial statements are
available) exceeds 3% of the book value of the assets of the Company and
its Subsidiaries taken as a whole (determined on a consolidated basis in
accordance with GAAP for the most recent fiscal quarter for which
financial statements are available).
"Termination Date": February 23, 1999 or such earlier date as the
Commitments shall terminate as provided herein.
"364-Day Credit Agreement": the 364-Day Revolving Credit Agreement
dated as of the date hereof among the Company, the financial institutions
from time to time party thereto, Morgan, as documentation agent and co-
arranger, Chemical, as administrative agent and co-arranger, and Barclays
and Continental, as agents, as the same may be amended, supplemented or
modified.
"Tranche": the collective reference to Eurodollar Loans or C/D Rate
Loans the Interest Periods with respect to all of which begin on the same
date and end on the same later date (whether or not such Loans shall
originally have been made on the same day). Tranches may be identified
as "Eurodollar Tranches" or "C/D Rate Tranches", as applicable.
"Transfer Effective Date": as defined in each Commitment Transfer
Supplement.
"Transferees": as defined in Section 9.6(f).
"Type": as to any Loan, its nature as a Base Rate Loan, a C/D Rate
Loan or a Eurodollar Loan.
"Unused Commitment": as to any Bank, at a particular time, an
amount equal to such Bank's Commitment Percentage of the excess, if
any, of (a) the aggregate Commitments at such time over (b) the
aggregate outstanding principal amount of the Loans at such time.
<PAGE>20
"Wholly Owned Subsidiary": any Subsidiary of the Company to the
extent at least 80% of the capital stock or other ownership interests of
such Subsidiary, other than directors' or nominees' qualifying shares, is
owned directly or indirectly by the Company; provided, that the term
"Wholly Owned Subsidiary" shall include LAH.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified herein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes or any
certificate or other document made or delivered pursuant hereto.
(b) As used herein and in the Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Company and its Subsidiaries not defined in Section 1.1 and accounting terms
partly defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP; provided, that if a change in
GAAP occurs after the date hereof which materially affects (either favorably
or adversely) the ability of the Company to comply with any covenant contained
in Section 6, the Banks and the Company agree to renegotiate in good faith the
terms of such covenant.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, each Bank severally agrees to make revolving credit loans
(the "Loans") to the Company from time to time during the Commitment Period in
an aggregate principal amount at any one time outstanding not to exceed the
lesser of (i) such Bank's Commitment and (ii) such Bank's Commitment
Percentage of the aggregate Original Commitment. During the Commitment Period
the Company may use the Commitments by borrowing, prepaying the Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof.
(b) The Loans may from time to time be (i) Eurodollar Loans, (ii)
Base Rate Loans, (iii) C/D Rate Loans or (iv) a combination thereof, as
determined by the Company and notified to the Administrative Agent in
accordance with Sections 2.3 and 2.7; provided, that no Loan shall be made as
a Eurodollar Loan or a C/D Rate Loan after the day that is one month or 30
days, respectively, prior to the Termination Date.
<PAGE>21
2.2 Revolving Credit Notes. The Loans made by each Bank shall be
evidenced by a promissory note of the Company, substantially in the form of
Exhibit A, with appropriate insertions as to payee, date and principal amount
(a "Note"), payable to the order of such Bank and in a principal amount equal
to the lesser of (a) the amount of the initial Commitment of such Bank and (b)
the aggregate unpaid principal amount of all Loans made by such Bank. Each
Bank is hereby authorized to record the date, Type and amount of each Loan
made by such Bank, each continuation thereof, each conversion of all or a
portion thereof to another Type, the date and amount of each payment or
prepayment of principal thereof and, in the case of Eurodollar Loans and C/D
Rate Loans, the length of each Interest Period with respect thereto, on the
schedule annexed to and constituting a part of its Note, and any such
recordation shall constitute prima facie evidence of the accuracy of the
information so recorded; provided, that the failure of any Bank to make any
such recordation or any error in any such recordation shall not affect the
obligations of the Company hereunder or under such Note. Each Note shall (x)
be dated the Closing Date, (y) be stated to mature on the Termination Date and
(z) provide for the payment of interest in accordance with Section 2.9.
2.3 Procedure for Revolving Credit Borrowing. The Company may
borrow under the Commitments during the Commitment Period on any Eurodollar
Business Day, if all or any part of the requested Loans are to be initially
Eurodollar Loans, or on any Business Day, otherwise; provided, that the
Company shall give the Administrative Agent irrevocable notice (which notice
must be received by the Administrative Agent prior to 10:00 A.M., New York
City time, (a) with respect to any of the requested Loans that are to be
initially Eurodollar Loans, three Eurodollar Business Days prior to the
requested Borrowing Date, (b) with respect to any of the requested Loans that
are to be initially C/D Rate Loans, one Business Day prior to the requested
Borrowing Date, or (c) with respect to any of the requested Loans that are to
be initially Base Rate Loans, one Business Day prior to the requested
Borrowing Date; provided, that with respect to any of the requested Loans to
be made on the initial Borrowing Date as Base Rate Loans, notice for such
Loans may be given on such initial Borrowing Date), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing
is to be of Eurodollar Loans, Base Rate Loans, C/D Rate Loans or a combination
thereof and (iv) if the borrowing is to be entirely or partly of Eurodollar
Loans or C/D Rate Loans, the respective amounts of each such Loan and the
respective lengths of the initial Interest Periods therefor. Each borrowing
under the Commitments shall be in an amount equal to $10,000,000 or a whole
multiple of $1,000,000 in excess thereof or in the remaining amount of the
Available Commitments. Upon receipt of any such notice from the Company, the
Administrative Agent shall promptly notify each Bank thereof. Each Bank will
make the amount of its pro rata share of each borrowing available to the
<PAGE>22
Administrative Agent for the account of the Company at the office of the
Administrative Agent specified in Section 9.2 prior to 11:00 A.M., New York
City time, on the Borrowing Date requested by the Company in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Company by the Administrative Agent's crediting the account
of the Company on the books of such office with the aggregate of the amounts
made available to the Administrative Agent by the Banks and in like funds as
received by the Administrative Agent.
2.4 Fees. (a) Commitment Fee. The Company agrees to pay to the
Administrative Agent for the account of each Bank a commitment fee for the
period from and including the Closing Date, computed at the Commitment Fee
Rate on the average daily amount of the Unused Commitment of such Bank during
the period for which payment is made, payable quarterly in arrears on the last
day of each March, June, September and December and on the Termination Date,
commencing on the first of such dates to occur after the date hereof.
(b) Upfront Fee. The Company agrees to pay to the Administrative
Agent for the account of each Bank an upfront fee equal to the applicable
Upfront Fee Percentage of the Commitment of such Bank in effect on the Closing
Date, payable on the Closing Date. The "Upfront Fee Percentage" shall be
based on the initial commitment of such Bank for this Agreement, as expressed
in writing by such Bank to the Company (and before final allocation of the
Commitments), in accordance with the following table:
Initial
Commitment (Before Upfront
Final Allocation) Fee Percentage
$71,000,000 or more 0.07%
$53,250,000 to $70,999,999 0.06%
$35,500,000 to $53,249,999 0.05%
$17,750,000 to $35,499,999 0.04%
Less than $17,750,000, if any 0%
(c) Other Fees. The Company agrees to pay to each Agent such other
fees as have been agreed to in writing by the Company and such Agent.
2.5 Termination or Reduction of Commitments. The Company shall
have the right, upon not less than three Business Days' notice to the Agent,
to terminate the Commitments or, from time to time, to reduce the amount of
the Commitments; provided, that no such termination or reduction shall be
permitted if, after giving effect thereto and to any payments or prepayments
of the Loans made on the effective date thereof, the aggregate principal
amount of the Loans then outstanding would exceed the aggregate Commitments
then in effect. Any such reduction shall be in an amount equal to $10,000,000
or a whole multiple of
<PAGE>23
$1,000,000 in excess thereof and shall reduce permanently the Commitments then
in effect.
2.6 Prepayments. (a) The Company may at any time and from time to
time prepay the Loans, in whole or in part, without premium or penalty, upon
at least three Business Days' irrevocable notice to the Administrative Agent
in the case of Base Rate Loans and C/D Rate Loans and at least three
Eurodollar Business Days' irrevocable notice to the Administrative Agent in
the case of Eurodollar Loans, which notice shall specify the date and amount
of prepayment and whether the prepayment is of Eurodollar Loans, Base Rate
Loans, C/D Rate Loans or a combination thereof, and, if of a combination
thereof, the amount allocable to each. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Bank thereof. If any such
notice is given, the amount specified in such notice shall be due and payable
on the date specified therein, together with accrued interest to such date on
the amount prepaid. Partial prepayments shall be in an aggregate principal
amount of $10,000,000 or a whole multiple of $1,000,000 in excess thereof.
Each prepayment of Eurodollar Loans and C/D Rate Loans shall be subject to
compliance with the provisions of Sections 2.8 and 2.16.
(b) If at any time the principal amount of Loans then outstanding
shall exceed the Commitments, the Company shall immediately prepay or at its
option cash collateralize the Loans as provided in Section 2.6(c) in an amount
equal to such excess. Amounts payable pursuant to this Section 2.6(b) shall
be applied, first, to prepay any Base Rate Loans then outstanding and second,
to prepay or cash collateralize (at the Company's option) any Eurodollar Loans
or C/D Rate Loans then outstanding (provided, that any Eurodollar Loans or C/D
Rate Loans so cash collateralized shall be prepaid no later than the last day
of the respective Interest Periods therefor). Each prepayment pursuant to
this Section 2.6(b) shall be accompanied by accrued interest on the amount
prepaid and, in the case of prepayments of Eurodollar Loans, any amounts
payable pursuant to Section 2.16.
(c) The Company shall cash collateralize Eurodollar Loans or C/D
Rate Loans pursuant to Section 2.6(b) by depositing in an account with the
Administrative Agent (the "Cash Collateral Account"), to be established and
maintained pursuant to such terms and conditions as shall be specified by the
Administrative Agent in its discretion, an amount determined pursuant to the
second sentence of Section 2.6(b) with respect to Eurodollar Loans or C/D Rate
Loans, as the case may be. Such deposited monies shall be held by the
Administrative Agent as cash collateral (the "Cash Collateral") for the
outstanding Eurodollar Loans or C/D Rate Loans, as the case may be, on a pro
rata basis; provided, that if any Base Rate Loans shall be made while there is
Cash Collateral on deposit in the Cash Collateral Account, the Administrative
Agent shall apply such Cash Collateral to the immediate prepayment of such
Base Rate Loans and only the Cash
<PAGE>24
Collateral remaining after such prepayment, if any, shall be retained in the
Cash Collateral Account. The Cash Collateral Account and the Cash Collateral
shall be subject to the sole dominion and control of the Administrative Agent
and, except as set forth above, the Cash Collateral shall be retained in the
Cash Collateral Account until the repayment of Eurodollar Loans or C/D Rate
Loans, as the case may be, in an amount equal to the amount of the Cash
Collateral deposited therein. Upon any such repayment, an amount equal to the
amount of such repayment shall be transferred from the Cash Collateral Account
to the Company. The Administrative Agent shall invest the Cash Collateral in
Cash Equivalents, and shall pay over to the Company any interest earned on
such investments quarterly on the last day of each March, June, September and
December; provided, that no Default or Event of Default shall have occurred
and be continuing (in which case such interest shall be retained as Cash
Collateral). The Administrative Agent shall not be liable for any losses or
decreases in value with respect to the Cash Collateral, other than those
occurring as a result of its gross negligence or willful misconduct.
2.7 Conversion and Continuation Options. (a) The Company may
elect from time to time to convert Eurodollar Loans or C/D Rate Loans to Base
Rate Loans, and/or to convert Eurodollar Loans or Base Rate Loans to C/D Rate
Loans, by giving the Administrative Agent at least two Business Days' prior
irrevocable notice of such election; provided, that any such conversion of
Eurodollar Loans or C/D Rate Loans may only be made on the last day of an
Interest Period with respect thereto. The Company may elect from time to time
to convert Base Rate Loans or C/D Rate Loans to Eurodollar Loans by giving the
Agent at least three Eurodollar Business Days' prior irrevocable notice of
such election; provided, that any such conversion of C/D Rate Loans may,
subject to the third succeeding sentence, only be made on the last day of an
Interest Period with respect thereto. Any such notice of conversion to
Eurodollar Loans or C/D Rate Loans shall specify the length of the initial
Interest Period or Interest Periods therefor. Upon receipt of any such notice
the Agent shall promptly notify each Bank thereof. If the last day of the
then current Interest Period with respect to C/D Rate Loans that are to be
converted to Eurodollar Loans is not a Eurodollar Business Day, such
conversion shall be made on the next succeeding Eurodollar Business Day, and
during the period from such last day to such succeeding Eurodollar Business
Day such Loans shall bear interest as if they were Base Rate Loans. All or
any part of outstanding Eurodollar Loans, Base Rate Loans and C/D Rate Loans
may be converted as provided herein; provided, that (i) no Loan may be
converted into a Eurodollar Loan or a C/D Rate Loan when any Event of Default
(upon notice from the Administration Agent, on behalf of the Required Banks,
except such notice shall not be required in the case of the Event of Default
described in Section 7(f)) has occurred and is continuing, (ii) any such
conversion may only be made if, after giving effect thereto, Section 2.8 shall
not have been
<PAGE>25
contravened and (iii) no Loan may be converted into a Eurodollar Loan or a C/D
Rate Loan after the date that is one month or 30 days, respectively, prior to
the Termination Date.
(b) Any Eurodollar Loan or C/D Rate Loan may be continued as such
upon the expiration of the then current Interest Period with respect thereto
by the Company giving notice to the Administrative Agent, in accordance with
the applicable provisions of the term "Interest Period" set forth in Section
1.1, of the length of the next Interest Period to be applicable to such Loans;
provided, that no Eurodollar Loan or C/D Rate Loan may be continued as such
(i) when any Event of Default (upon notice from the Administration Agent, on
behalf of the Required Banks, except such notice shall not be required in the
case of the Event of Default described in Section 7(f)) has occurred and is
continuing, (ii) if, after giving effect thereto, Section 2.8 would be
contravened or (iii) after the date that is one month or 30 days,
respectively, prior to the Termination Date; provided further, that if the
Company shall fail to give any required notice as described above in this
paragraph or if such continuation is not permitted pursuant to the preceding
proviso such Loans shall be automatically converted to Base Rate Loans on the
last day of such then expiring Interest Period.
2.8 Minimum Amounts of Tranches. All borrowings, conversions and
continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, the aggregate principal amount of the Loans
comprising (a) each Eurodollar Tranche shall be equal to $15,000,000 or a
whole multiple of $1,000,000 in excess thereof, (b) each C/D Rate Tranche
shall be equal to $15,000,000 or a whole multiple of $1,000,000 in excess
thereof and (c) there shall be no more than 12 different Tranches outstanding
at any one time.
2.9 Interest Rates and Payment Dates. (a) Each Eurodollar Loan
shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such
Interest Period plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum
equal to the Base Rate plus the Applicable Margin.
(c) Each C/D Rate Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the C/D Rate
determined for such day plus the Applicable Margin.
(d) If all or a portion of (i) the principal amount of any Loan,
(ii) any interest payable thereon or (iii) any fee or other amount payable
pursuant to this Agreement shall not be paid when due (whether at the stated
maturity, by acceleration or
<PAGE>26
otherwise), such overdue amount shall bear interest at a rate per annum which
is (x) in the case of overdue principal, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section 2.9
plus 2%, (y) in the case of overdue interest (to the extent permitted by
applicable law) or fees, the rate described in paragraph (b) of this Section
2.9 plus 2% or (z) in the case of other amounts payable pursuant to this
Agreement, the then applicable Base Rate, in each case from the date of such
non-payment until such amount is paid in full (as well after as before
judgment).
(e) Interest shall be payable in arrears on each Interest Payment
Date; provided, that interest accruing pursuant to paragraph (d) of this
Section 2.9 shall be payable on demand, or, in the absence of demand, weekly
on Friday of each week.
2.10 Computation of Interest and Fees. (a) Interest on Loans and
fees shall be calculated on the basis of a 360-day year for the actual days
elapsed; provided, that interest on Base Rate Loans computed with reference to
the Administrative Agent's reference rate shall be calculated on the basis of
a 365- (or 366-, as the case may be) day year for the actual days elapsed.
The Administrative Agent shall as soon as practicable notify in writing the
Company and the Banks of each determination of a Eurodollar Rate or of a C/D
Rate. Any change in the interest rate on a Loan resulting from a change in
the Ratings, the Base Rate, the C/D Assessment Rate or the C/D Reserve
Percentage and any change in the commitment fee pursuant to Section 2.4(a)
resulting from a change in the Commitment Fee Rate shall become effective as
of the opening of business on the day on which such change becomes effective.
The Administrative Agent shall as soon as practicable notify in writing the
Company and the Banks of the effective date and the amount of each such change
in interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Company and the Banks in the absence of manifest error. The
Administrative Agent shall, at the request of the Company or a Bank, deliver
to the Company or such Bank, as the case may be, a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to Section 2.9(a) or (c).
(c) If any Reference Bank's Commitment shall terminate or all its
Loans shall be assigned for any reason whatsoever or such Reference Bank shall
fail on two consecutive times to furnish quotations of the rate to the
Administrative Agent pursuant to Section 2.10(d), such Reference Bank shall
thereupon cease to be a Reference Bank, and if, as a result of the foregoing,
there shall only be one Reference Bank remaining, the Administrative Agent
(after consultation with the Company and the Banks) shall, by notice to the
Company and the Banks, designate
<PAGE>27
another Bank as a Reference Bank so that there shall at all times be at least
two Reference Banks.
(d) Each Reference Bank shall use its best efforts to furnish
quotations of rates to the Administrative Agent as contemplated hereby. If
any of the Reference Banks shall be unable or shall otherwise fail to supply
such rates to the Administrative Agent upon its request, the rate of interest
shall, subject to the provisions of Section 2.11, be determined on the basis
of the quotations of the remaining Reference Banks or Reference Bank.
2.11 Inability to Determine Interest Rate. In the event that prior
to the first day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Company) that, by
reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate or the
C/D Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the
Required Banks that the Eurodollar Rate or the C/D Rate determined or to
be determined for such Interest Period will not adequately and fairly
reflect the cost to such Banks (as conclusively certified in writing by
such Banks) of making or maintaining their affected Loans during such
Interest Period,
the Administrative Agent shall give telecopy or telephonic notice (confirmed
in writing) thereof to the Company and the Banks as soon as practicable
thereafter. If such notice is given (x) any Eurodollar Loans or C/D Rate
Loans, as the case may be, requested to be made on the first day of such
Interest Period shall be made as Base Rate Loans, (y) any Loans that were to
have been converted on the first day of such Interest Period to Eurodollar
Loans or C/D Rate Loans, as the case may be, shall be converted to or
continued as Base Rate Loans and (z) any outstanding Eurodollar Loans or C/D
Rate Loans, as the case may be, shall be converted, on the first day of such
Interest Period, to Base Rate Loans. The Administrative Agent shall promptly
notify the Company at such time as the conditions set forth in (a) and (b)
above are no longer in effect, and until such notice has been delivered by the
Administrative Agent, no further Eurodollar Loans or C/D Rate Loans shall be
made or continued as such, nor shall the Company have the right to convert
Loans to Eurodollar Loans or C/D Rate Loans, as the case may be.
2.12 Pro Rata Treatment and Payments. (a) Each borrowing by the
Company from the Banks of Loans, each payment by the Company on account of any
commitment fee or upfront fee hereunder and any reduction of the Commitments
of the Banks shall be made pro rata according to the respective Commitment
<PAGE>28
Percentages of the Banks. Each payment (including each prepayment) by the
Company on account of principal of and interest on the Loans shall be made pro
rata according to the respective outstanding principal amounts of the Loans
then held by the Banks. All payments (including prepayments) to be made by
the Company hereunder and under the Notes, whether on account of principal,
interest, fees or otherwise, shall be made without set-off or counterclaim and
shall be made prior to 12:00 Noon, New York City time, on the due date thereof
to the Administrative Agent, for the account of the Banks, at the
Administrative Agent's office specified in Section 9.2, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Banks promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the Eurodollar Loans) becomes due
and payable on a day other than a Business Day, such payment shall be extended
to the next succeeding Business Day, and, with respect to payments of
principal, interest thereon shall be payable at the then applicable rate
during such extension. If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Eurodollar Business Day, the maturity thereof
shall be extended to the next succeeding Eurodollar Business Day unless the
result of such extension would be to extend such payment into another calendar
month, in which event such payment shall be made on the immediately preceding
Eurodollar Business Day.
(b) Unless the Administrative Agent shall have been notified in
writing by any Bank prior to a Borrowing Date that such Bank will not make the
amount that would constitute its portion of the borrowing to be made on such
date available to the Administrative Agent, the Administrative Agent may
assume that such Bank has made such amount available to the Administrative
Agent on such Borrowing Date, and the Administrative Agent may, in reliance
upon such assumption, make available to the Company a corresponding amount.
If such amount is made available to the Administrative Agent on a date after
such Borrowing Date, such Bank shall pay to the Administrative Agent on demand
an amount equal to the product of (i) the daily average Federal funds rate
during such period as quoted by the Administrative Agent, times (ii) the
amount of such Bank's portion of such borrowing, times (iii) a fraction the
numerator of which is the number of days that elapse from and including such
Borrowing Date to the date on which such Bank's portion of such borrowing
shall have become immediately available to the Administrative Agent and the
denominator of which is 360. A certificate of the Administrative Agent
submitted to any Bank with respect to any amounts owing under this Section
2.12(b) shall be conclusive in the absence of manifest error. If such Bank's
portion of such borrowing is not in fact made available to the Administrative
Agent by such Bank within three Business Days of such Borrowing Date, the
Administrative Agent shall be entitled to recover such amount with interest
thereon at the rate per annum applicable to Base Rate Loans hereunder, on
demand, from the Company. If the Company returns to the Administrative Agent
any amount with
<PAGE>29
interest thereon as described in the immediately preceding sentence, such Bank
shall indemnify the Company for the difference, if any, between (i) the
aggregate interest paid by the Company to the Administrative Agent in
accordance with the immediately preceding sentence less (ii) the aggregate
interest which actually accrued on such amount prior to its return to the
Administrative Agent.
2.13 Illegality. Notwithstanding any other provision herein, if
any change in any Requirement of Law or in the interpretation or application
thereof shall make it unlawful for any Bank to make or maintain Eurodollar
Loans as contemplated by this Agreement, (a) the commitment of such Bank
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Domestic Dollar Loans to Eurodollar Loans shall forthwith be cancelled
and (b) such Bank's Loans then outstanding as Eurodollar Loans, if any, shall
be converted automatically to Base Rate Loans on the respective last days of
the then current Interest Periods with respect to such Loans or within such
earlier period as required by law. If any such conversion of a Eurodollar
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Company shall pay to such Bank such amounts,
if any, as may be required pursuant to Section 2.16.
2.14 Other Costs; Increased Costs. (a) The Company agrees to pay
to each Bank which requests compensation under this Section 2.14(a) (by
written notice to the Company), on the last day of each Interest Period with
respect to any Eurodollar Loan made by such Bank, so long as such Bank shall
be required to maintain reserves against "Eurocurrency liabilities" under
Regulation D of the Board of Governors of the Federal Reserve System (or, so
long as such Bank may be required by such Board of Governors or by any other
Governmental Authority to maintain reserves against any category of
liabilities which includes deposits by reference to which the interest rate on
Eurodollar Loans is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Bank which includes
any Eurodollar Loans), an additional amount (determined by such Bank and
notified to the Company) representing such Bank's calculation or, if an
accurate calculation is impracticable, reasonable estimate (using such
reasonable means of allocation as such Bank shall determine) of the actual
costs, if any, incurred by such Bank while such Eurodollar Loans were
outstanding as a result of the applicability of the foregoing reserves to such
Eurodollar Loans, which amount in any event shall not exceed the product of
the following for each day while such Eurodollar Loans were outstanding:
(i) the principal amount of the relevant Eurodollar Loans made by
such Bank outstanding on such day; and
<PAGE>30
(ii) the difference between (x) a fraction the numerator of which is
the Eurodollar Rate (expressed as a decimal) applicable to such
Eurodollar Loans, and the denominator of which is one minus the maximum
rate (expressed as a decimal) at which such reserve requirements are
imposed by such Board of Governors or other Governmental Authority on
such date minus (y) such numerator; and
(iii) a fraction the numerator of which is one and the denominator of
which is 360.
(b) In the event that any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Bank with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject any Bank to any tax of any kind whatsoever with
respect to this Agreement, any Note or any Eurodollar Loan or C/D Rate
Loan made by it, or change the basis of taxation of payments to such Bank
in respect thereof (except for taxes covered by Section 2.15 and changes
in the rate of tax on the overall net income of such Bank);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by,
any office of such Bank which is not otherwise described in Section
2.14(a) or otherwise included in the determination of the C/D Rate; or
(iii) shall impose on such Bank any other condition;
and the result of any of the foregoing is to increase the cost to such Bank,
by an amount which such Bank deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or C/D Rate Loans or to reduce any
amount receivable hereunder in respect thereof, then, in any such case, the
Company shall pay such Bank within 15 Business Days following demand therefor
any additional amounts necessary to compensate such Bank for such increased
cost or reduced amount receivable. If any Bank becomes entitled to claim any
additional amounts pursuant to this Section 2.14(b), it shall promptly notify
the Company, through the Administrative Agent, of the event by reason of which
it has become so entitled.
(c) In the event that any Bank shall have determined that any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Bank or any
corporation controlling such Bank with any request or directive regarding
capital adequacy (whether
<PAGE>31
or not having the force of law) from any Governmental Authority made
subsequent to the date hereof does or shall have the effect of reducing the
rate of return on such Bank's or such corporation's capital as a consequence
of its obligations hereunder to a level below that which such Bank or such
corporation could have achieved but for such change or compliance (taking into
consideration such Bank's or such corporation's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, after submission by such Bank to the Company (with a copy to the
Administrative Agent) of a written request therefor, the Company shall pay to
such Bank within 15 Business Days following demand therefor such additional
amount or amounts as will compensate such Bank for such reduction.
(d) A certificate as to any additional amounts payable pursuant to
this Section 2.14 submitted by the relevant Bank, through the Administrative
Agent, to the Company shall be conclusive in the absence of manifest error.
The covenants contained in this Section 2.14 shall survive the termination of
this Agreement and the payment of the Notes and all other amounts payable
hereunder. Any notice to be given by a Bank under this Section 2.14 after
termination of this Agreement shall be effective only if given within 120 days
after such Bank becomes aware or should have become aware of the events giving
rise to such notice.
2.15 Taxes. (a) All payments made by the Company under this
Agreement and the Notes shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding, in the case of each Agent and each Bank,
(i) net income taxes, franchise and branch profit taxes (imposed in lieu of
net income taxes) imposed on such Agent or such Bank, as the case may be, as a
result of a present or former connection between the jurisdiction of the
government or taxing authority imposing such tax and such Agent or such Bank
(excluding a connection arising solely from such Agent or such Bank having
executed, delivered or performed its obligations or received a payment under,
or enforced, this Agreement or the Notes) or any political subdivision or
taxing authority thereof or therein and (ii) any taxes, levies, imposts,
duties, charges, fees, deductions or withholdings arising after the Closing
Date, solely as a result of or attributable to such Agent or Bank (x) changing
its designated lending office as of the Closing Date to a lending office
located in any other jurisdiction or (y) designating an additional lending
office located in any other jurisdiction (all such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions and withholdings being hereinafter
called "Taxes"). If any Taxes are required to be withheld from any amounts
payable to any Agent or any Bank hereunder or under the Notes, the amounts so
payable to such
<PAGE>32
Agent or such Bank shall be increased to the extent necessary to yield to such
Agent or such Bank (after payment of all Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement and the Notes. Whenever any Taxes are payable by the Company, as
promptly as possible thereafter the Company shall send to the Administrative
Agent for its own account or for the account of such Agent or Bank, as the
case may be, a copy of any original official receipt that may be received by
the Company showing payment thereof. If the Company fails to pay any Taxes
when due to the appropriate taxing authority or fails to remit to the
Administrative Agent the receipts that may be received or other available
documentary evidence, the Company shall indemnify the Agents and the Banks for
any incremental taxes, interest or penalties that may become payable by any
Agent or any Bank to the United States or other Governmental Authority as a
result of any such failure. The agreements in this Section 2.15(a) shall
survive the termination of this Agreement and the payment of the Notes and all
other amounts payable hereunder. If any Taxes constituting a withholding tax
of the United States of America or any other Governmental Authority shall be
or become applicable, after the Closing Date, to such payments by the Company
to an Agent or Bank, such Agent or Bank shall use its best efforts to make,
fund and maintain its Loans through another lending office of such Agent or
Bank in another jurisdiction so as to reduce, to the fullest extent possible,
the Company's liability hereunder, if the making, funding or maintenance of
such Loans through such other office does not otherwise materially adversely
affect such Loans or such Agent or Bank.
(b) Prior to the first Interest Payment Date, each Bank that is not
incorporated under the laws of the United States of America or a state thereof
agrees that it will deliver to the Company and the Administrative Agent (i)
two duly completed copies of United States Internal Revenue Service Form 1001
or 4224 or successor applicable form, as the case may be, and (ii) an Internal
Revenue Service Form W-8 or W-9 or successor applicable form. Each such Bank
also agrees to deliver to the Company and the Administrative Agent two further
copies of the said Form 1001 or 4224 and Form W-8 or W-9, or successor
applicable forms or other manner of certification, as the case may be, on or
before the date that any such form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent form previously
delivered by it to the Company, and such extensions or renewals thereof as may
reasonably be requested by the Company or the Administrative Agent, unless in
any such case an event (including, without limitation, any change in treaty,
law or regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable or which
would prevent such Bank from duly completing and delivering any such form with
respect to it and such Bank so advises the Company and the Administrative
Agent. Such Bank shall certify (i) in the case of a Form 1001 or 4224, that
it is entitled to receive
<PAGE>33
payments under this Agreement without deduction or withholding of any United
States federal income taxes and (ii) in the case of a Form W-8 or W-9, that it
is entitled to an exemption from United States backup withholding tax. The
Company shall not be required to pay any increased amount on account of Taxes
pursuant to this Section 2.15 to an Agent or Bank that fails to furnish any
form or statement that it is required to furnish in accordance with this
Section 2.15(b) and, to the extent required by law, the Company shall be
entitled to deduct Taxes from the payments owed to such Bank or Agent. In the
event that the Company is required to pay any Bank any additional amount or
indemnify any Bank pursuant to Section 2.15(a) and no change in lending office
is made in accordance with the last sentence of Section 2.15(a), after the
Company makes such payment, such Bank shall transfer, in accordance with the
procedures set forth in Section 9.6(c), its Loans and Commitment to a Bank
selected by the Company with the approval of such transferor Bank and the
Administrative Agent (not to be unreasonably withheld).
2.16 Indemnity. The Company agrees to indemnify each Bank and to
hold each Bank harmless from any loss or expense which such Bank may sustain
or incur as a consequence of (a) default by the Company in payment when due of
the principal amount of or interest on any Eurodollar Loan or C/D Rate Loan,
(b) default by the Company in making a borrowing of, conversion into or
continuation of Eurodollar Loans or C/D Rate Loans after the Company has given
a notice requesting the same in accordance with the provisions of this
Agreement, (c) default by the Company in making any prepayment after the
Company has given a notice thereof in accordance with the provisions of this
Agreement, (d) the making of a voluntary or involuntary prepayment of
Eurodollar Loans or C/D Rate Loans on a day which is not the last day of an
Interest Period with respect thereto or (e) the conversion of Eurodollar Loans
to Domestic Dollar Loans pursuant to Section 2.11 or 2.13 on a day which is
not the last day of the Interest Period with respect thereto, including,
without limitation, in each case, any such loss or expense arising from the
reemployment of funds obtained by it or from fees payable to terminate the
deposits from which such funds were obtained. A certificate setting forth the
computation of any amount payable pursuant to the foregoing sentence submitted
by a Bank, through the Administrative Agent, to the Company shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Notes and all other
amounts payable hereunder.
2.17 Purpose. The proceeds of the Loans shall be used by the
Company solely for general corporate purposes, including acquisitions
(including the acquisition of Federal Systems).
<PAGE>34
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Agreement and to
make the Loans herein provided for, the Company hereby represents and warrants
to each Agent and to each Bank that:
3.1 Financial Condition. (a) The consolidated balance sheet of
the Company and its Subsidiaries as at March 31, 1993 and the related
consolidated statements of income and retained earnings and of cash flows for
the fiscal year ended on such date, reported on by Coopers & Lybrand and (b)
the unaudited consolidated balance sheets of the Company and its Subsidiaries
as at December 31, 1993 and the related unaudited consolidated statements of
income and retained earnings and of cash flows for the fiscal quarter ended on
such date, copies of which have heretofore been furnished to each Bank, are
complete and correct in all material respects and present fairly (except, with
respect to interim reports, for normal year-end adjustments) the consolidated
financial condition of the Company and its Subsidiaries as at such date, and
the consolidated results of their operations and cash flows for the fiscal
period then ended. All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP
applied consistently throughout the periods involved (except as approved by
such accountants and as disclosed therein). Except as disclosed on Schedule
3.1 hereto, such audited financial statements, taken together, disclose, in
accordance with GAAP, all material contingent liabilities and liability for
taxes, long-term leases and unusual forward or long-term commitments of the
Company and its Subsidiaries.
3.2 No Change. Since March 31, 1993 (a) there has been no change
in the business, operations, property or financial or other condition of the
Company or any of its Subsidiaries which has or could reasonably be expected
to have a Material Adverse Effect and (b) no dividends or other distributions
have been declared, paid or made upon any shares of capital stock of the
Company nor have any shares of capital stock of the Company been redeemed,
retired, purchased or otherwise acquired for value by the Company or any of
the Subsidiaries except as permitted by Section 6.5.
3.3 Corporate Existence; Compliance with Law. Each of the Company
and the Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate power and authority and the legal right to
own and operate its property, to lease the property it operates as lessee and
to conduct the business in which it is currently engaged, (c) is duly
qualified as a foreign corporation and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, except to the extent that
the failure to be
<PAGE>35
so qualified could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect, and (d) is in compliance with all Requirements of Law
except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
3.4 Corporate Power; Authorization; Enforceable Obligations. The
Company has the corporate power and authority and the legal right to make,
deliver and perform this Agreement and the Notes and to borrow hereunder and
has taken all necessary corporate action to authorize the borrowings on the
terms and conditions of this Agreement and the Notes and to authorize the
execution, delivery and performance of this Agreement and the Notes. No
consent or authorization of, filing with or other act by or in respect of any
Governmental Authority is required in connection with the borrowings hereunder
or with the execution, delivery, performance, validity or enforceability of
this Agreement and the Notes, other than those which have been obtained or
made and are in full force and effect. This Agreement has been, and each Note
will be, duly executed and delivered on behalf of the Company. This Agreement
constitutes, and each Note when executed and delivered will constitute, a
legal, valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity
or at law).
3.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the Notes by the Company, the borrowings hereunder and the use
of the proceeds thereof, will not violate any Requirement of Law or any
Contractual Obligation applicable to the Company or of any of the
Subsidiaries, and will not result in, or require, the creation or imposition
of any Lien on any of its or their respective properties or revenues pursuant
to any Requirement of Law or Contractual Obligation.
3.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending
or, to the knowledge of the Company, threatened by or against the Company or
any of the Subsidiaries or against any of its or their respective properties
or revenues (a) with respect to this Agreement and the Notes or any of the
transactions contemplated hereby, or (b) which could reasonably be expected to
have a Material Adverse Effect, excluding litigation described in the
Company's Form 10-K for the fiscal year ended March 31, 1993 filed with the
Securities and Exchange Commission (but not excluding developments with
respect thereto occurring after March 31, 1993 not described in such Form 10-
K).
<PAGE>36
3.7 No Default. Neither the Company nor any of the Subsidiaries is
in default under or with respect to any Contractual Obligation in any respect
which could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.
3.8 Ownership of Property; Liens. Each of the Company and the
Subsidiaries has good record and marketable title in fee simple to or valid
leasehold interests in all its real property, and good title to all its other
property, and none of such property is subject to any Lien, except as
permitted in Section 6.3 and except where the failure to have such title could
not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.
3.9 Taxes. Each of the Company and the Subsidiaries has filed or
caused to be filed all tax returns which to the knowledge of the Company are
required to be filed and has paid all taxes shown to be due and payable on
said returns or on any assessments made against it or any of its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority (other than those the amount or validity of which
is currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Company or the Subsidiaries, as the case may be, and other than
those the non-payment of which could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect); and no federal income tax liens
have been filed and, to the knowledge of the Company, no claims are being
asserted with respect to any such taxes, fees or other charges, except any
such claims which could not reasonably be expected to have a Material Adverse
Effect.
3.10 Federal Regulations. No part of the proceeds of any Loans
hereunder will be used for the purpose of "purchasing" or "carrying" any
"margin stock" within the respective meanings of each of the quoted terms
under Regulation U of the Board of Governors of the Federal Reserve System as
now and from time to time hereafter in effect or for any purpose which
violates the provisions of the Regulations of such Board of Governors. If
requested by any Bank or the Administrative Agent, the Company will furnish to
the Administrative Agent and each Bank a statement to the foregoing effect in
conformity with the requirements of Federal Reserve Form U-1 referred to in
said Regulation U.
3.11 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which
this representation is made or deemed made with respect to any Plan which has
resulted or could reasonably be expected to result in a liability to the
Company or any Substantial Subsidiary in excess of
<PAGE>37
$2,000,000, and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code. No termination of a Single
Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. The present value of all accrued
benefits under each Single Employer Plan (based on those assumptions used to
fund such Plans) did not, as of the last annual valuation date prior to the
date on which this representation is made or deemed made, exceed, by more than
$35,000,000, the value of the assets of such Plan allocable to such accrued
benefits; provided, however, that with respect to the defined benefit pension
plan to be established by Federal Systems, such amount shall be $50,000,000
rather than $35,000,000. Neither the Company nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any Multiemployer Plan,
and neither the Company nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Company or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as
of the valuation date most closely preceding the date on which this
representation is made or deemed made, where such liability could, in the
aggregate, reasonably be expected to have a Material Adverse Effect. No such
Multiemployer Plan is in Reorganization or Insolvent.
3.12 Investment Company Act; Other Regulations. The Company is not
an "investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. The
Company is not subject to regulation under any Federal or State statute or
regulation which limits its ability to incur Indebtedness.
3.13 Subsidiaries. Except as disclosed on Schedule 3.13, the
Subsidiaries listed in the Company's annual report on Form 10-K for its fiscal
year ended March 31, 1993 constitute all of the Subsidiaries of the Company on
the Effective Date.
3.14 Environmental Matters. Each of the representations and
warranties set forth in paragraphs (a) through (e) of this Section 3.14 is
true and correct with respect to each parcel of real property owned or
operated by the Company or any Subsidiary (the "Properties"), except to the
extent that (i) the facts and circumstances giving rise to any such failure to
be so true and correct could not reasonably be expected to have a Material
Adverse Effect or (ii) the Company and the Subsidiaries are fully indemnified
against any liabilities which may result from any such failure to be so true
and correct:
(a) The Properties do not contain, and have not previously
contained, in, on, or under, including, without limitation, the soil and
groundwater thereunder, any Hazardous Materials in concentrations which
violate Environmental Laws.
<PAGE>38
(b) The Properties and all operations and facilities at the
Properties are in compliance with all Environmental Laws, and there is no
Hazardous Materials contamination or violation of any Environmental Law
which could interfere with the continued operation of any of the
Properties or impair the fair saleable value of any thereof.
(c) Neither the Company nor any of the Subsidiaries has received
any written complaint, notice of violation, alleged violation,
investigation or advisory action or of potential liability or of
potential responsibility regarding environmental protection matters or
permit compliance with regard to the Properties, nor is the Company aware
that any Governmental Authority is threatening to deliver to the Company
or any of the Subsidiaries any such notice.
(d) Hazardous Materials have not been generated, treated, stored,
disposed of, at, on or under any of the Properties, nor have any
Hazardous Materials been transferred from the Properties to any other
location in violation of any Environmental Law.
(e) There are no governmental, administrative actions or judicial
proceedings pending or (to the knowledge of the Company) contemplated
under any Environmental Laws to which the Company or any of the
Subsidiaries is or (to the knowledge of the Company) will be named as a
party with respect to the Properties, nor are there any consent decrees
or other decrees, consent orders, administrative orders or other orders,
or other administrative or judicial requirements outstanding under any
Environmental Law with respect to any of the Properties.
3.15 Full Disclosure. All information heretofore furnished by the
Company to any Agent or any Bank for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all such information
hereafter furnished by the Company to any Agent or any Bank will be, true and
accurate in all material respects on the date as of which such information is
stated or certified. The Company has disclosed to the Banks in writing any
and all facts which could reasonably be expected to have a Material Adverse
Effect.
SECTION 4 CONDITIONS PRECEDENT
4.1 Conditions of Initial Loans. The obligation of each Bank to
make its initial Loan hereunder is subject to the satisfaction of the
following conditions precedent:
(a) Agreement and Notes. The Documentation Agent shall have
received (i) counterparts of this Agreement duly executed and delivered
by the Company, each Agent and each Bank and (ii) for the account of each
Bank a Note conforming
<PAGE>39
to the requirements hereof and executed by a duly authorized officer of
the Company.
(b) Legal Opinions. The Documentation Agent shall have received,
with a photocopy counterpart for each Bank, (i) an opinion of Willkie
Farr & Gallagher, counsel to the Company, dated the Closing Date and
addressed to the Agents and the Banks, substantially in the form of
Exhibit B-1, (ii) an opinion of Eric J. Zahler, Esq., General Counsel of
the Company, dated the Closing Date and addressed to the Agents and the
Banks, substantially in the form of Exhibit B-2, and given on the express
instructions of the Company and (iii) an opinion of Simpson Thacher &
Bartlett, counsel to the Agents and the Banks, dated the Closing Date and
addressed to the Agents and the Banks, in form and substance satisfactory
to the Agents.
(c) Closing Certificate. The Documentation Agent shall have
received, with a photocopy counterpart for each Bank, a Closing
Certificate of the Company, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments,
satisfactory in form and substance to the Documentation Agent and its
counsel, executed by the President or any Vice President and the
Secretary or any Assistant Secretary of the Company.
(d) No Proceeding or Litigation; No Injunctive Relief. No action,
suit or proceeding before any arbitrator or any Governmental Authority
shall have been commenced, no investigation by any Governmental Authority
shall have been commenced, no action, suit, proceeding or investigation
by any Governmental Authority shall have been threatened and no
Requirement of Law shall have been enacted or proposed, in each case as
of the Closing Date (i) seeking to restrain, prevent or change the
transactions contemplated by this Agreement in whole or in part or
questioning the validity or legality of the transactions contemplated by
this Agreement or seeking damages in connection with such transactions or
(ii) which could reasonably be expected to have a Material Adverse
Effect.
(e) Consents, Licenses, Approvals, etc. The Documentation Agent
shall have received true copies (certified to be such by the President or
any Vice President of the Company or other appropriate party) of all
consents, licenses and approvals required as of the Closing Date in
accordance with applicable law in connection with the execution,
delivery, performance, validity and enforceability of this Agreement and
the Notes, if the failure to obtain such consents, licenses or approvals,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
<PAGE>40
(f) Audited Financial Statements. The Documentation Agent shall
have received, with a copy for each Bank, the audited financial
statements described in Section 3.1(a), which financial statements shall
be in form and substance satisfactory to the Banks as of the Closing Date
and shall have been reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope of
the audit.
(g) Unaudited Financial Statements. The Documentation Agent shall
have received, with a copy for each Bank, the unaudited consolidated
financial statements of the Company described in Section 3.1(b), which
financial statements shall be in form and substance satisfactory to the
Banks as of the Closing Date.
(h) Indebtedness; Restrictions. The terms and conditions of any
Indebtedness and Contingent Obligations (including, without limitation,
maturities, interest rates, prepayment and redemption requirements,
covenants, defaults, remedies, security provisions and subordination
provisions) of the Company or any of the Subsidiaries to remain
outstanding after the Closing Date shall be satisfactory to the Banks in
all respects as of the Closing Date, and the Banks shall be satisfied as
of the Closing Date that the Company and its Subsidiaries are not subject
to contractual or other restrictions that would be violated by this
Agreement or the transactions contemplated hereby.
(i) New Developments. As of the Closing Date there shall not have
occurred any change, or development or event involving a prospective
change, which in either case in the opinion of the Banks could reasonably
be expected to have a Material Adverse Effect.
(j) Undisclosed Information. As of the Closing Date the Banks
shall not have become aware of any previously undisclosed materially
adverse information with respect to (i) the business, operations,
properties, condition (financial or otherwise) or prospects of the
Company and its Subsidiaries taken as a whole, (ii) the ability of the
Company to perform its obligations under this Agreement or the Notes or
(iii) the rights or remedies of the Agents or the Banks hereunder or
thereunder.
(k) Fees. The Agents and the Banks shall have received all fees
and expenses required to be paid on or before the Closing Date.
(l) Representations and Warranties. Each of the representations
and warranties made by the Company in or pursuant to this Agreement shall
be true and correct on and as of the Closing Date as if made on and as of
such date.
<PAGE>41
(m) No Default. No Default or Event of Default shall have occurred
and be continuing on the Closing Date or after giving effect to the Loans
requested to be made on such date, if any.
(n) Cancellation of Existing Revolving Credit Agreement. The
Revolving Credit Agreement dated as of December 2, 1992, as amended,
among the Company, the financial institutions parties thereto, Morgan, as
documentation agent, Chemical, as administrative agent, Barclays, as
agent, and Continental, as co-agent, shall have been cancelled and all
obligations thereunder shall have been discharged in full.
(o) Additional Documents. The Documentation Agent shall have
received each additional document, instrument, legal opinion or item of
information reasonably requested by it on or prior to the Closing Date,
including, without limitation, a copy of any debt instrument, security
agreement or other material contract to which the Company or any
Subsidiary may then be a party.
(p) Additional Matters. All corporate and other proceedings and
all documents, instruments and other legal matters in connection with the
transactions contemplated by this Agreement shall be satisfactory in form
and substance to the Documentation Agent as of the Closing Date, and the
Documentation Agent shall have received such other documents and legal
opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably request on or prior
to the Closing Date.
4.2 Conditions to all Loans. The obligation of each Bank to make
any Loan to be made by it hereunder is subject to the satisfaction of the
following conditions precedent on the relevant Borrowing Date:
(a) Representations and Warranties. Each of the representations
and warranties made by the Company in or pursuant to this Agreement shall
be true and correct on and as of such date as if made on and as of such
date except to the extent they expressly relate to an earlier date.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
Loans requested to be made on such date.
Each borrowing by the Company hereunder shall constitute a representation and
warranty by the Company as of the date of such borrowing that the conditions
contained in this Section 4.2 have been satisfied.
<PAGE>42
SECTION 5. AFFIRMATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, any Note remains outstanding and unpaid or any other amount is owing
to any Bank or any Agent hereunder, the Company shall and (except in the case
of delivery of financial information, reports and notices) shall cause each of
the Subsidiaries to:
5.1 Financial Statements. Furnish to each Bank:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Company, a copy of the consolidated
balance sheet of the Company and its consolidated Subsidiaries as at the
end of such year and the related consolidated statements of income and
retained earnings and of cash flows for such year, setting forth in each
case in comparative form the figures for the previous year, reported on
without a "going concern" or like qualification or exception, or
qualification arising out of the scope of the audit, by independent
certified public accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Company, the unaudited consolidated balance sheets of the
Company and its consolidated Subsidiaries as at the end of such quarter
and the related unaudited consolidated statements of income and retained
earnings and cash flows of the Company and its consolidated Subsidiaries
for such quarter (except as to statements of cash flow) and the portion
of the fiscal year through such date, setting forth in each case in
comparative form the figures for the previous periods which would be
required under Form 10-Q promulgated by the Securities and Exchange
Commission, certified by a Responsible Officer (subject to normal year-
end audit adjustments);
all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein (except as
approved by such accountants or officer, as the case may be, and disclosed
therein).
5.2 Certificates; Other Information. Furnish to each Bank:
(a) concurrently with the delivery of the financial statements
referred to in Section 5.1(a) above, a certificate of the independent
certified public accountants reporting on such financial statements stating
that in making the examination necessary therefor no knowledge was obtained of
any Default or Event of Default, except as specified in such certificate;
<PAGE>43
(b) concurrently with the delivery of the financial statements
referred to in Sections 5.1(a) and (b) above, a certificate of a Responsible
Officer (i) stating that, to the best of such officer's knowledge, the Company
during such period has observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in this Agreement and in
the Notes to be observed, performed or satisfied by it, and that such officer
has obtained no knowledge of any Default or Event of Default except as
specified in such certificate, and (ii) showing in detail the calculations
supporting such statement in respect of Sections 6.1, 6.2, and 6.5;
(c) within five days after the same are sent, copies of all
financial statements and reports which the Company sends to its stockholders,
and within five days after the same are filed, copies of all financial
statements and reports which the Company may make to, or file with, the
Securities and Exchange Commission or any successor or analogous Governmental
Authority; and
(d) promptly, such additional financial and other information as
any Bank may from time to time reasonably request.
5.3 Payment of Obligations. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all
its material obligations of whatever nature (other than Indebtedness and
Contingent Obligations, which shall be beyond the scope of this Section 5.3),
except when the amount or validity thereof is currently being contested in
good faith by appropriate proceedings and reserves in conformity with GAAP
with respect thereto have been provided on the books of the Company or its
Subsidiaries, as the case may be.
5.4 Conduct of Business and Maintenance of Existence. With respect
to the Company and its Subsidiaries taken as a whole, continue to engage in
business of a similar, related, synergistic or complimentary nature as now
conducted by it and preserve, renew and keep in full force and effect its
corporate existence and maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business and comply in all
material respects with all material Contractual Obligations (other than
Indebtedness and Contingent Obligations, which shall be beyond the scope of
this Section 5.4) and material Requirements of Law (except for Environmental
Laws, which shall be governed by Section 5.8), except as otherwise expressly
permitted by this Agreement.
5.5 Maintenance of Property; Insurance. Keep all property useful
and necessary in its business in good working order and condition; maintain
with financially sound and reputable insurance companies or through a formal
self-insurance
<PAGE>44
program insurance on all its property in at least such amounts and against at
least such risks but including in any event public liability, product
liability and business interruption as are usually insured against in the same
general area by companies engaged in the same or a similar business; and
furnish to each Bank, upon written request, full information as to the
insurance carried.
5.6 Inspection of Property; Books and Records; Discussions. Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and, subject to
applicable governmental security and secrecy regulations, permit
representatives of any Bank to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may reasonably be desired with prior notice to the
Company (which can have a representative present if it so chooses), and to
discuss the business, operations, properties and financial and other condition
of the Company and its Subsidiaries with officers and employees of the Company
and its Subsidiaries and with its independent certified public accountants.
5.7 Notices. Promptly give notice (to be confirmed promptly in
writing) to the Administrative Agent and each Bank:
(a) of the occurrence of any Default or Event of Default;
(b) of any (i) default or event of default under any Contractual
Obligation of the Company or any Subsidiary or (ii) litigation, investigation
or proceeding which may exist at any time between the Company or any
Subsidiary and any Governmental Authority, which in either case, if not cured
or if adversely determined, as the case may be, could reasonably be expected
to have a Material Adverse Effect;
(c) of any litigation or proceeding affecting the Company or any
Subsidiary in which the amount involved is $15,000,000 or more and not covered
by insurance; or in which injunctive or similar relief is sought and which
could reasonably be expected to have a Material Adverse Effect;
(d) as soon as possible and in any event within 30 days after the
Company knows or has reason to know of the following events: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan which could reasonably be expected to result in any liability to the
Company or any Subsidiary in excess of $2,000,000 or any withdrawal from, or
the termination, Reorganization or Insolvency of, any Multiemployer Plan, or
(ii) the institution of proceedings or the taking or expected taking of any
other action by PBGC or the Company or any Commonly Controlled Entity with
respect to the
<PAGE>45
withdrawal from, or the terminating, Reorganization or Insolvency of, any
Plan. The Company shall deliver to the Administrative Agent and each Bank a
certificate of the chief financial officer of the Company setting forth the
details thereof and the action that the Company or Commonly Controlled Entity
proposes to take with respect thereto;
(e) of any put notice received by the Company made pursuant to
Section 2.09 of the Stockholders Agreement;
(f) of any change in a Rating; and
(g) of any change in the business, operations, property or
financial or other condition of the Company or any of its Subsidiaries.
Each notice pursuant to this Section 5.7 shall be accompanied by a statement
of a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Company proposes to take with respect
thereto.
5.8 Environmental Laws.
(a) Comply with, and require compliance by all tenants and
subtenants, if any, with, all Environmental Laws and obtain and comply with
and maintain, and insure that all tenants and subtenants obtain and comply
with and maintain, any and all licenses, approvals, registrations or permits
required by Environmental Laws, except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required by a
Governmental Authority under Environmental Laws and promptly comply with all
lawful orders and directives of all Governmental Authorities respecting
Environmental Laws, except to the extent that the same are being contested in
good faith by appropriate proceedings and the pendency of such proceedings
could not reasonably be expected to have a Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Agents and the Banks,
and their respective employees, agents, officers and directors, from and
against any claims, demands, penalties, fines, liabilities, settlements,
damages, costs and expenses of whatever kind or nature known or unknown,
contingent or otherwise, arising out of, or in any way relating to the
violation of or noncompliance with any Environmental Laws applicable to the
Properties, or any orders, requirements or demands of Governmental Authorities
related thereto, including, without limitation, attorney's and consultant's
fees, investigation and laboratory fees, court costs and litigation expenses,
except to the extent that any of the foregoing arise
<PAGE>46
out of the gross negligence or willful misconduct of the party seeking
indemnification therefor. The agreements in this paragraph shall survive
repayment of the Notes and all other amounts payable hereunder.
5.9 Ratings. Take all reasonable action to enable Moody's and S&P,
or their respective successors, to have in effect a published or unpublished
rating for the Company's senior unsecured debt.
SECTION 6. NEGATIVE COVENANTS
The Company hereby agrees that, so long as the Commitments remain in
effect, any Note remains outstanding and unpaid or any other amount is owing
to any Bank or any Agent hereunder, the Company shall not nor shall it permit
any Subsidiary to, directly or indirectly:
6.1 Financial Condition Covenants. (a) Maintenance of Consolidated
Net Worth. Permit Consolidated Net Worth on the last day of any fiscal
quarter to be less than the sum of (X) $1 billion plus (Y) 40% of Consolidated
Net Income, if positive, for the period from April 1, 1993 to the last day of
such fiscal quarter.
(b) Interest Coverage. Permit the ratio of Consolidated Net Income
(before consolidated interest expense, interest income and taxes) to
consolidated interest expense (net of interest income) for the twelve-month
period ending on the last day of any fiscal quarter of the Company to be less
than 2.5 to 1.0, commencing with the fiscal quarter ending March 31, 1994.
6.2 Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness under this Agreement and the 364-Day Credit
Agreement;
(b) Indebtedness outstanding under the 7% Indenture, the 9-1/8%
Indenture, the 8-3/8% Indenture and other Subordinated Debt;
(c) unsecured Indebtedness incurred in the ordinary course of
business consistent with prior practice in respect of commercial and standby
letters of credit issued by any financial institution to secure contractual
commitments to its customers;
(d) Customer Advances arising in the ordinary course of business
consistent with prior practice;
(e) Indebtedness arising out of clause (c) of the definition of
"Indebtedness" as a result of progress payments or advances made pursuant to
government contracts;
<PAGE>47
(f) Indebtedness owed by a Wholly Owned Subsidiary to another
Wholly Owned Subsidiary and Indebtedness owed to the Company by a Wholly Owned
Subsidiary; and
(g) in addition to any Indebtedness permitted by clauses (a)
through (f) above, Funded Debt incurred after the date hereof so long as the
ratio of consolidated Funded Debt of the Company and its consolidated
Subsidiaries to Consolidated Net Worth as of the last day of the most recently
completed fiscal quarter on a pro forma basis (i.e., after giving effect to
the incurrence of Funded Debt and the application of the proceeds thereof), as
if such debt had been incurred on the first day of such fiscal quarter, would
not exceed the ratio set forth below opposite the period in which such most
recently completed fiscal quarter occurred:
Period Ratio
Closing Date - March 31, 1995 1.65:1
April 1, 1995 - March 31, 1996 1.40:1
April 1, 1996 - March 31, 1997 1.25:1
Thereafter 1.00:1
Notwithstanding the foregoing, (x) no Subsidiary shall create, incur, assume
or suffer to exist any Funded Debt other than intercompany debt permitted by
clause (f) above if the principal amount of such Funded Debt exceeds 10% of
Consolidated Net Worth, and (y) no Funded Debt shall be created, incurred or
assumed after the occurrence of a Default or Event of Default or if such
creation, incurrence or assumption would result in a Default or Event of
Default, unless the Company shall obtain the written consent of the Required
Banks prior to such creation, incurrence or assumption.
6.3 Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except:
(a) Liens for taxes not yet due or which are being contested in
good faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Company or the appropriate
Subsidiary, as the case may be, in accordance with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business
which are not overdue for a period of more than 60 days or which are being
contested in good faith and by appropriate proceedings;
(c) pledges or deposits in connection with workmen's compensation,
unemployment insurance and other social security legislation and deposits
securing liabilities to insurance carriers under insurance and self-insurance
agreements;
<PAGE>48
(d) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions and other Liens incurred
in the ordinary course of business which do not secure Indebtedness and which
do not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
the Company or any Subsidiaries;
(f) Liens in favor of the United States of America for amounts paid
to the Company or any of the Subsidiaries as progress payments under
government contracts entered into by it;
(g) (i) Liens which were in existence on March 31, 1993 and which
secured obligations reflected in the audited balance sheet referred to in
Section 3.1(a) hereof, (ii) immaterial Liens created after March 31, 1993 and
in existence on the Effective Date, (iii) Liens on the assets of Loral Vought
Systems, Inc., and (iv) Liens on the assets of Federal Systems and its
Subsidiaries existing on the date of the acquisition thereof by the Company
and its Subsidiaries, and renewals and extensions of any of the foregoing
which do not increase the principal amount of the obligations secured thereby
or extend to or cover any property other than the property covered by any such
Lien or property covered by another permitted Lien on March 31, 1993, the
Effective Date or such date of acquisition, as the case may be;
(h) Liens on assets of corporations which become Subsidiaries after
the date of this Agreement; provided, that such Liens existed at the time the
respective corporations become Subsidiaries and were not created in
anticipation thereof;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(j) Liens upon real and/or personal property, which property was
acquired after the Effective Date by the Company or any Subsidiary in the
ordinary course of business, each of which Liens was created solely for the
purpose of securing Indebtedness incurred for the purpose of financing such
acquisition or for the purpose of securing any refinancings or renewals
thereof; provided, that no such Lien shall extend to or cover any property of
the Company or any such Subsidiary other than the respective property so
acquired and improvements thereon, and the principal amount of Indebtedness
secured by any such Lien shall at no time exceed 100% of the fair market value
(as determined in good faith by the board of directors of the Company) of the
respective property at the time it was acquired; and
<PAGE>49
(k) Liens created pursuant to Section 2.6(c) and pursuant to
Section 2.6(c) of the 364-Day Credit Agreement.
6.4 Limitation on Fundamental Changes. (a) Enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution) except that any
Subsidiary may be merged or consolidated (i) with or into the Company
(provided that the Company shall be the continuing or surviving corporation)
or (ii) with or into any one or more Wholly Owned Subsidiaries (including any
entity that, after giving effect to such merger or consolidation, is a Wholly
Owned Subsidiary) other than a Wholly Owned Subsidiary domiciled outside the
United States of America (provided that the Wholly Owned Subsidiary shall be
the continuing or surviving corporation); or
(b) convey, sell, lease, transfer or otherwise dispose of any
assets in a transaction or series of related transactions if the fair market
value of such assets (determined by the Board of Directors of the Company in
good faith) is greater than 10% of Consolidated Net Worth, except that:
(i) any Subsidiary may sell, lease, transfer or otherwise dispose
of any or all of its assets (upon voluntary liquidation or otherwise) to
the Company or a Wholly Owned Subsidiary (other than a Wholly Owned
Subsidiary domiciled outside the United States of America);
(ii) the Company or any Subsidiary may sell, lease, transfer or
otherwise dispose of inventory in the ordinary course of business;
(iii) the Company or any Subsidiary may sell, transfer or otherwise
dispose of Cash Equivalents in exchange for a comparable amount of cash
and/or Cash Equivalents;
(iv) the Company and its Subsidiaries may sell receivables in a
principal amount not to exceed $100,000,000 at any one time outstanding
to a special purpose vehicle for the purpose of a receivables-based
financing;
(v) the Company or any Subsidiary may convey, sell, lease, transfer
or otherwise dispose of any assets in a transaction or series of related
transactions if the fair market value of such assets (determined by the
Board of Directors of the Company in good faith) is greater than 10% of
Consolidated Net Worth and the amount of such excess is used to prepay
the Loans and to permanently reduce the Commitments and to prepay loans
and to permanently reduce commitments under the 364-Day Credit Agreement,
ratably based on the then Commitments and commitments under the 364-Day
Credit Agreement; and
<PAGE>50
(vi) any Subsidiary may sell assets pursuant to existing Contractual
Obligations disclosed on Schedule 6.4.
6.5 Limitation on Restricted Payments. (a) Declare or pay any
dividends (other than dividends payable solely in stock of the Company or
Historical Dividends) on, or make any payment on account of, or set apart
assets for a sinking or other analogous fund for the purchase, redemption,
retirement or other acquisition of, any shares of any class of stock of the
Company or any Subsidiary (except dividends payable to the Company and
dividends by LAH on the Series S Preferred Stock issued by LAH), whether now
or hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in cash or property or in obligations
of the Company or any Subsidiary, or permit any Subsidiary to make any payment
on account of, or purchase or otherwise acquire, any shares of any class of
stock of the Company or any Subsidiary from any Person (all of the foregoing
shall collectively be referred to as "Restricted Payments"), except that, so
long as no Default or Event of Default has occurred and is continuing or would
result from the making of such Restricted Payment, the Company may make a
Restricted Payment if the sum of (i) such Restricted Payment plus (ii) the
Restricted Payments made from the Closing Date through any date of
determination, shall not exceed an amount equal to the sum of (A) $100,000,000
plus (B) 25% of the aggregate (if positive) Consolidated Net Income from
April 1, 1993 through the end of the fiscal quarter immediately preceding such
date of determination; or
(b) make any Investment (other than pursuant to clauses (b) through
(h) of Section 6.6) or incur, directly or indirectly, any Contingent
Obligation (all of the foregoing shall collectively be referred to as "Other
Restricted Payments"), except that, so long as no Default or Event of Default
has occurred and is continuing or would result from the making of such Other
Restricted Payment, the Company may make an Other Restricted Payment if the
sum of (i) such Other Restricted Payment plus (ii) the Other Restricted
Payments made from the Closing Date through any date of determination, shall
not exceed an amount equal to the sum of (A) 100% of the aggregate Equity
Issuance Proceeds received by the Company or any Subsidiary subsequent to
April 1, 1992 plus (B) upon any Person becoming a Wholly Owned Subsidiary, the
amount of any Investments made by the Company or any Wholly Owned Subsidiary
in such Person (other than Investments permitted by Section 6.6) prior to such
time plus (C) the proceeds from the sale of any Investment made with an Other
Restricted Payment permitted by this Section 6.5.
The value of any dividends paid other than in cash and the value of any
Investments made other than in cash shall be the value determined in good
faith by the Board of Directors of the Company and evidenced by a resolution
of such Board.
<PAGE>51
6.6 Investments. Make, commit to make or maintain any Investment,
except:
(a) as permitted by Section 6.5;
(b) Investments by the Company existing on the date hereof as set
forth on Schedule 6.6;
(c) Investments by the Company or Subsidiaries in Wholly Owned
Subsidiaries and Investments by Subsidiaries in the Company;
(d) Investments in accounts, contract rights and chattel paper (as
defined in the Uniform Commercial Code), and notes receivable, arising or
acquired in the ordinary course of business;
(e) Investments in Cash Equivalents;
(f) short-term Investments in adjustable rate preferred stock
issued by an issuer rated at least A-1 or the equivalent thereof by S&P
or P-1 or the equivalent thereof by Moody's;
(g) Excluded Employee Loans; and
(h) Investments consisting of the purchase by the Company of
Federal Systems under the Asset Purchase Agreement referred to in the
definition of "Federal Systems" set forth in Section 1.1.
6.7 Affiliates. Enter into any transaction, including, without
limitation, the purchase, sale or exchange of property or the rendering of any
services, with any Affiliate (other than a Wholly Owned Subsidiary) or enter
into, assume or suffer to exist any employment or consulting contract with any
such Affiliate, except any contract disclosed in the Company's Form 10-K for
the fiscal year ended March 31, 1993 filed with the Securities and Exchange
Commission (including any modification or amendment to any such contract that,
in the reasonable judgment of the Company, is no less favorable to the Company
than such contract) and any transaction or contract which is in the ordinary
course of the Company's business and which is upon fair and reasonable terms
no less favorable to the Company than it would obtain in a comparable arm's
length transaction with a Person not an Affiliate.
6.8 Sale and Leaseback. After the date hereof, enter into any
arrangement with any Person providing for the leasing by the Company or any
Subsidiary of real or personal property which has been or is to be sold or
transferred by the Company or any Subsidiary 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 Company or such
<PAGE>52
Subsidiary, unless the amount by which all such transactions occurring after
the Effective Date exceeds $50,000,000 is applied by the Company to prepay the
Loans and to permanently reduce the Commitments.
6.9 Corporate Documents. Amend its Certificate of Incorporation in
any material respect adverse to the Banks (except to increase the number of
authorized shares of common stock).
6.10 Restrictions on Subsidiaries. Permit any Wholly Owned
Subsidiary to enter into any agreement which prohibits or restricts the
ability of such Wholly Owned Subsidiary to (i) pay dividends or make any other
distributions on its capital stock (other than the Series S Preferred Stock
issued by LAH), or any other interest or participation in, or measured by, its
profits, owned by the Company or any of its Wholly Owned Subsidiaries, or pay
any Indebtedness owed to the Company or any of its Wholly Owned Subsidiaries,
(ii) make loans or advances to the Company or any of its Wholly Owned
Subsidiaries or (iii) transfer any of its properties or assets to the Company
or any of its Wholly Owned Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of: (A) the terms of this Agreement,
(B) applicable law, (C) customary non-assignment provisions entered into in
the ordinary course of business and consistent with past practices, (D) the
terms of purchase money obligations for property acquired in the ordinary
course of business, but only to the extent that such purchase money
obligations restrict or prohibit the transfer of the property so acquired, (E)
any encumbrance or restriction with respect to a Wholly Owned Subsidiary of
the Company that is not a Wholly Owned Subsidiary of the Company on the
Effective Date which encumbrance or restriction is in existence at the time
such person becomes a Wholly Owned Subsidiary of the Company or is created on
the date it becomes a Wholly Owned Subsidiary of the Company, (F) any
encumbrance or restriction with respect to a Wholly Owned Subsidiary of the
Company imposed pursuant to an agreement which has been entered into for the
sale or disposition of all or substantially all the capital stock or assets of
such Wholly Owned Subsidiary or (G) any encumbrance or restriction existing
under any agreement which refinances or replaces the agreement described in
clause (A); provided, that the terms and conditions of any such encumbrances
or restrictions contained in any such agreement constitute no greater
encumbrance or restriction on the ability of any Wholly Owned Subsidiary to
pay dividends or make distributions, make loans or advances or transfer
properties or assets than those under or pursuant to the agreement evidencing
the Indebtedness or obligations refinanced.
<PAGE>53
SECTION 7. EVENTS OF DEFAULT
Upon the occurrence of any of the following events:
(a) The Company shall fail to pay any principal of any Notes when
due in accordance with the terms thereof or hereof; or the Company shall fail
to pay any interest on any Notes, or any fee or other amount payable
hereunder, within five days after any such amount becomes due in accordance
with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made by or on
behalf of the Company herein or which is contained in any certificate,
document or financial or other statement furnished at any time under or in
connection with this Agreement shall prove to have been incorrect in any
material respect on or as of the date made or deemed made; or
(c) The Company shall default in the observance or performance of
any agreement contained in Section 6; or
(d) The Company shall default in the observance or performance of
any other agreement contained in this Agreement, and such default shall
continue unremedied for a period of 30 days; or
(e) The Company or any of its Subsidiaries shall (A) default in any
payment of principal of or interest on any Indebtedness (other than the Notes)
or in the payment of any Contingent Obligation, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness or
Contingent Obligation was created and (I) the aggregate principal amount of
(x) all such Indebtedness equals or exceeds $15,000,000 or (y) all such
Contingent Obligations equals or exceeds $100,000,000 and (II) with respect to
a default in the payment of interest by the Company or any Subsidiary, the
effect of such default is to cause, or permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Contingent Obligation (or
a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or such Contingent
Obligation to become payable or (B) default in the observance or performance
of any other agreement or condition relating to any such Indebtedness or such
Contingent Obligation or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or
to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Contingent Obligation (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Contingent Obligation to become payable; or
<PAGE>54
(f) (i) The Company or any of its Substantial Subsidiaries shall
commence any case, proceeding or other action (A) under any existing or future
law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or
its debts, or (B) seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of its
assets, or the Company or any of its Substantial Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against the Company or any of its Substantial Subsidiaries any case,
proceeding or other action of a nature referred to in clause (i) above which
(A) results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a period
of 60 days; or (iii) there shall be commenced against the Company or any of
its Substantial Subsidiaries any case, proceeding or other action seeking
issuance of a warrant of attachment, execution, distraint or similar process
against all or any substantial part of its assets which results in the entry
of an order for any such relief which shall not have been vacated, discharged,
or stayed or bonded pending appeal within 60 days from the entry thereof; or
(iv) the Company or any of its Substantial Subsidiaries shall take any action
in furtherance of, or indicating its consent to, approval of, or acquiescence
in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the
Company or any of its Substantial Subsidiaries shall generally not, or shall
be unable to, or shall admit in writing its inability to, pay its debts as
they become due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302 of
ERISA), whether or not waived, shall exist with respect to any Plan, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion of the
Required Banks, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) the Company or any Commonly Controlled
Entity shall, or is, in the reasonable opinion of the Required Banks, likely
to, incur any liability in connection with a withdrawal from, or the
Insolvency or Reorganization of, a Multiemployer Plan, or (vi) any other event
or condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all
other such events or conditions, if any, could subject the Company or any of
its Subsidiaries to any
<PAGE>55
tax, penalty or other liabilities in the aggregate material in relation to the
business, operations, property or financial or other condition of the Company
and its Subsidiaries taken as a whole;
(h) One or more judgments or decrees shall be entered against the
Company or any of its Substantial Subsidiaries involving in the aggregate a
liability (not paid or fully covered by insurance) of $15,000,000 or more and
all such judgments or decrees shall not have been vacated, discharged, stayed
or bonded pending appeal within 60 days from the entry thereof; or
(i) A Change in Control shall occur; or
(j) An Event of Default shall occur under Section 7 of the 364-Day
Credit Agreement;
then, and in any such event, (A) if such event is an Event of Default
specified in clause (i) or (ii) of paragraph (f) above, automatically the
Commitments shall immediately terminate and the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the
Notes shall immediately become due and payable, and (B) if such event is any
other Event of Default, either or both of the following actions may be taken,
without prejudice to the rights of any Bank to enforce its claims against the
Company: (i) with the consent of the Required Banks, the Administrative Agent
may, or upon the request of the Required Banks, the Administrative Agent
shall, by notice to the Company, declare the Commitments to be terminated
forthwith, whereupon the Commitments shall immediately terminate; and (ii)
with the consent of the Required Banks, the Administrative Agent may, or upon
the request of the Required Banks, the Administrative Agent shall, by notice
of default to the Company, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the Notes to be
due and payable forthwith, whereupon the same shall immediately become due and
payable. Except as expressly provided above in this Section 7, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.
SECTION 8. THE AGENTS
8.1 Appointment. Each Bank hereby irrevocably designates Morgan as
the Documentation Agent of such Bank under this Agreement and each such Bank
irrevocably authorizes Morgan, as the Documentation Agent for such Bank, to
take such action on its behalf under the provisions of this Agreement and to
exercise such powers and perform such duties as are expressly delegated to the
Documentation Agent by the terms of this Agreement, together with such other
powers as are reasonably incidental thereto. Each Bank hereby irrevocably
designates and appoints Chemical as the Administrative Agent of such Bank
under this Agreement, and each such Bank irrevocably authorizes Chemical, as
the
<PAGE>56
Administrative Agent for such Bank, to take such action on its behalf under
the provisions of this Agreement and to exercise such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. Each Bank hereby irrevocably designates and appoints each of
Barclays and Continental as an Agent of such Bank under this Agreement, and
each such Bank irrevocably authorizes each of Barclays and Continental, as an
Agent for such Bank, to take action on its behalf under this Agreement.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Agents shall not have any duties or responsibilities, except those expressly
set forth herein, or any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or otherwise exist against the Agents.
8.2 Delegation of Duties. The Agents may execute any of their
duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Agents shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by any of them with
reasonable care.
8.3 Exculpatory Provisions. No Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement (except for its or such
Person's own gross negligence or willful misconduct), or (ii) responsible in
any manner to any of the Banks for any recitals, statements, representations
or warranties made by the Company or any officer thereof contained in this
Agreement or in any certificate, report, statement or other document referred
to or provided for in, or received by such Agent under or in connection with,
this Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the Notes or for any
failure of the Company to perform its obligations hereunder or thereunder. No
Agent shall be under any obligation to any Bank to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records
of the Company.
8.4 Reliance by Agents. The Agents shall be entitled to rely, and
shall be fully protected in relying, upon any Note, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by them to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Company), independent accountants and other
<PAGE>57
experts selected by the Agents. The Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes unless a written
notice of assignment, negotiation or transfer thereof shall have been filed
with the Administrative Agent. The Administrative Agent shall be fully
justified in failing or refusing to take any action under this Agreement
unless it shall first receive such advice or concurrence of the Required Banks
as it deems appropriate or it shall first be indemnified to its satisfaction
by the Banks against any and all liability and expense which may be incurred
by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the Notes in accordance with
a request of the Required Banks, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Banks and all
future holders of the Notes.
8.5 Notice of Default. The Agents shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Bank or
the Company referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event
that the Administrative Agent receives such a notice, the Administrative Agent
shall give notice thereof to the Banks. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Banks; provided, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Banks.
8.6 Non-Reliance on Agents and Other Banks. Each Bank expressly
acknowledges that no Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates has made any representations or
warranties to it and that no act by any Agent hereafter taken, including any
review of the affairs of the Company, shall be deemed to constitute any
representation or warranty by such Agent to any Bank. Each Bank represents to
the Agents that it has, independently and without reliance upon the Agents or
any other Bank, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of
the Company and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Bank also represents that it will, independently
and without reliance upon the Agents or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own credit analysis, appraisals and/or decisions in taking or not
taking action under this Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, operations,
<PAGE>58
property, financial and/or other condition and creditworthiness of the
Company. Except for notices, reports and other documents expressly required
to be furnished to the Banks by the Administrative Agent hereunder, no Agent
shall have any duty or responsibility to provide any Bank with any credit or
other information concerning the business, operations, property, financial and
other condition or creditworthiness of the Company which may come into the
possession of such Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
8.7 Indemnification. The Banks agree to indemnify each Agent in
its capacity as such (to the extent not reimbursed by the Company and without
limiting the obligation of the Company to do so), ratably according to their
respective Commitment Percentages, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following the payment of the Notes)
be imposed on, incurred by or asserted against such Agent in any way relating
to or arising out of this Agreement, or any documents contemplated by or
referred to herein or the transactions contemplated hereby or any action taken
or omitted by such Agent under or in connection with any of the foregoing;
provided, that no Bank shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from such Agent's
gross negligence or willful misconduct. If any such amount with respect to
which the Banks have indemnified such Agent is recovered from the Company,
such Agent shall return the amount so recovered to the Banks which so
indemnified such Agent, but without interest, unless the Company has paid
interest. The agreements in this Section shall survive the payment of the
Notes and all other amounts payable hereunder.
8.8 Each Agent in Its Individual Capacity. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Company as though such Agent were not an Agent
hereunder. With respect to its Loans made or renewed by it and any Note
issued to it, each Agent shall have the same rights and powers under this
Agreement as any Bank and may exercise the same as though it were not an
Agent, and the terms "Bank" and "Banks" shall include each Agent in its
individual capacity. Each Bank and Transferee acknowledges that each of
Morgan, Chemical, Barclays and Continental is an agent and a lender under the
364-Day Credit Agreement.
8.9 Successor Agents. An Agent may resign as such upon 10 days'
notice to the Banks and the Company; provided, that such resignation shall not
become effective until a successor Agent is appointed in accordance with this
Section 8.9. If such Agent shall resign as an Agent under this Agreement,
then the
<PAGE>59
Required Banks shall appoint from among the Banks a successor agent for the
Banks which successor agent shall be approved by the Company, whereupon such
successor agent shall succeed to the rights, powers and duties of such Agent,
and any references to such Agent herein or in the Notes shall mean such
successor agent effective upon its appointment, and the former Agent's rights,
powers and duties as such shall be terminated, without any other or further
act or deed on the part of such former Agent or any of the parties to this
Agreement or any holders of the Notes. After any retiring Agent's resignation
as such, the provisions of this Section 8.9 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was an Agent under
this Agreement.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement, any Note, nor
any terms hereof or thereof may be amended, supplemented or modified except in
accordance with the provisions of this Section 9.1. With the written consent
of the Required Banks, the Documentation Agent, on behalf of the Banks and the
Agents, and the Company may, from time to time, enter into written amendments,
supplements or modifications hereto and to the Notes for the purpose of adding
any provisions to this Agreement or the Notes or changing in any manner the
rights of the Banks or of the Company hereunder or thereunder or waiving, on
such terms and conditions as the Documentation Agent may specify in such
instrument, any of the requirements of this Agreement or the Notes or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, supplement or modification shall (a) reduce
the amount or extend the scheduled maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce any fee payable to
any Bank hereunder, or reduce the principal amount of any Note, or change the
amount of any Bank's Commitment, in each case without the written consent of
each Bank affected thereby, or (b) amend, modify or waive any provision of
this Section 9.1, or reduce the percentage specified in the definition of
Required Banks, or consent to the assignment or transfer by the Company of any
of its rights and obligations under this Agreement, or release amounts in the
Cash Collateral Account other than in accordance with Section 2.6 in each case
without the written consent of all the Banks, or (c) amend, modify or waive
any provision of Section 8 without the written consent of the then Agents.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Banks and shall be binding upon the Company, the Banks,
the Agents and all future holders of the Notes. In the case of any waiver,
the Company, the Banks and the Agents shall be restored to their former
position and rights hereunder and under the outstanding Notes, and any Default
or Event of Default waived shall be deemed to be cured and not continuing; but
no such
<PAGE>60
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy or telex), and, unless otherwise expressly provided herein, shall be
deemed to have been duly given or made when delivered by hand, or three
Business Days after being deposited in the mail, postage prepaid, or, in the
case of telecopy notice, when received, or, in the case of telex notice, when
sent, answerback received, addressed as follows in the case of the Company and
the Agents, and as set forth in Schedule I in the case of the other parties
hereto, or to such other address as may be hereafter notified by the
respective parties hereto and any future holders of the Notes:
The Company: Loral Corporation
600 Third Avenue
New York, New York 10016
Attention: Michael P. DeBlasio
Senior Vice President - Finance
Telecopy: 212-661-8988
Telex: 64401
Answerback: LORAL CORP
with a copy to:
Loral Corporation
600 Third Avenue
New York, New York 10016
Attention: General Counsel
The Documentation
Agent: Morgan Guaranty Trust Company
of New York
60 Wall Street
New York, New York 10260-0600
Attention: Robert M. Osieski
Telecopy: 212-648-5014
with a copy to:
James T. Knight, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Telecopy: 212-455-2502
The Administrative
Agent: Chemical Bank
1375 Broadway, 8th Floor
New York, New York 10018
Attention: John C. Riordan
Telecopy: 212-827-4497
<PAGE>61
with a copy to:
Chemical Bank Agency
Services Corporation
Grand Central Tower
140 East 45th Street, 29th Floor
New York, New York 10017
Attention: Sandra Miklave
Telecopy: 212-270-0854
The Agent: Barclays Bank PLC
222 Broadway, 11th Floor
New York, New York 10038
Attention: S. Clarke Moody
Telecopy: 212-412-7580
The Agent: Continental Bank, N.A.
520 Madison Avenue, 3rd Floor
New York, New York 10022
Attention: Robert P. McKillip
Telecopy: 212-688-2905
; provided, that any notice, request or demand to or upon the Agents or the
Banks pursuant to Sections 2.3, 2.5, 2.6 and 2.7 shall not be effective until
received.
9.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Bank, any
right, remedy, power or privilege hereunder or under the Notes shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
remedy, power or privilege hereunder or thereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided or
provided in the Notes are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
9.4 Survival of Representations and Warranties. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement and the Notes.
9.5 Payment of Expenses and Taxes. The Company agrees (a) to pay
or reimburse each Agent for all its reasonable out-of-pocket costs and
expenses incurred in connection with the preparation and execution of, and any
amendment, supplement or modification to, this Agreement and the Notes and any
other documents prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and
<PAGE>62
disbursements of counsel to the Agents, (b) to pay or reimburse each Bank and
the Agents for all their reasonable costs and expenses incurred in connection
with the enforcement or preservation of any rights under this Agreement, the
Notes and any such other documents, including, without limitation, fees and
disbursements of counsel to the Agents and to the several Banks (including,
without limitation, the allocated costs of in-house counsel), (c) to pay,
indemnify, and hold each Bank and the Agents harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other taxes, if any,
which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any
waiver or consent under or in respect of, this Agreement, the Notes and any
such other documents, and (d) to pay, indemnify, and hold each Bank and the
Agents (and their respective directors, officers, employees and agents)
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever with respect to or arising out
of the execution, delivery, enforcement, performance, syndication and
administration of this Agreement, the Notes and any such other documents and
the use of proceeds of the Loans (all the foregoing, collectively, the
"indemnified liabilities"); provided, that the Company shall have no
obligation hereunder to any Agent or any Bank with respect to indemnified
liabilities arising from the gross negligence or willful misconduct of any
such Agent or any such Bank. The agreements in this Section 9.5 shall survive
repayment of the Notes and all other amounts payable hereunder.
9.6 Successors and Assigns; Participations; Purchasing Banks. (a)
This Agreement shall be binding upon and inure to the benefit of the Company,
the Banks, the Agents, all future holders of the Notes, and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of each Bank.
(b) Any Bank may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or
more banks or other entities ("Participants") participating interests in any
Loan owing to such Bank, any Note held by such Bank, the Commitment of such
Bank or any other interest of such Bank hereunder; provided, that if the
Participant is not an Affiliate of such Bank or another Bank, such Bank shall
obtain the prior consent of the Company to such sale of participating
interests (which consent shall not be unreasonably withheld or delayed); and
provided further, that such Bank shall reserve solely unto itself, and shall
not grant to any Participant, any part or all of its right to agree to the
amendment, modification or waiver of any of the terms of this Agreement, its
Note or any document related thereto, except to
<PAGE>63
the extent that such amendment, modification or waiver would reduce the
principal of, or interest on, the Notes or any fees payable hereunder, in each
case to the extent subject to such participation, or postpone the date of the
final maturity of, or any date fixed for any payment of interest on, the
Notes, in each case to the extent subject to such participation. In the event
of any such sale by a Bank of a participating interest to a Participant, such
Bank's obligations under this Agreement to the other parties to this Agreement
shall remain unchanged, such Bank shall remain solely responsible for the
performance thereof, such Bank shall remain the holder of any such Note for
all purposes under this Agreement and the Company, the Documentation Agent,
and the Administrative Agent shall continue to deal solely and directly with
such Bank in connection with such Bank's rights and obligations under this
Agreement. The Company agrees that if amounts outstanding under this
Agreement and the Notes are due and unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement and any Note to
the same extent as if the amount of its participating interest were owing
directly to it as a Bank under this Agreement or any Note; provided, that such
right of setoff shall be subject to the obligation of such Participant to
share with the Banks, and the Banks agree to share with such Participant, as
provided in Section 9.7. The Company also agrees that each Participant shall
be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.5 with respect
to its participation in the Commitments and the Loans outstanding from time to
time; provided, that no Participant shall be entitled to receive any greater
amount pursuant to such Sections than the transferor Bank would have been
entitled to receive in respect of the amount of the participation transferred
by such transferor Bank to such Participant had no such transfer occurred.
(c) Any Bank may, in the ordinary course of its commercial banking
business and in accordance with applicable law, and (if the Purchasing Bank is
not an Affiliate of such Bank or an existing Bank) with the prior consent of
the Company (which shall not be unreasonably withheld or delayed), at any time
sell to one or more banks or financial institutions ("Purchasing Banks") all
or any part of its rights and obligations under this Agreement and the Notes,
pursuant to a Commitment Transfer Supplement, executed by such Purchasing Bank
and such transferor Bank, and delivered to the Administrative Agent for its
acceptance and recording in the Register; provided, that if the Purchasing
Bank is not an Affiliate of such Bank or an existing Bank any sale of Loans
shall be in an amount equal to the lesser of (i) such Bank's Commitment and
(ii) $15,000,000; and provided, further, that no Bank may sell any part of its
rights and obligations under this Agreement and the Notes to a Purchasing Bank
unless a ratable share of its rights and obligations under the 364-Day Credit
Agreement are simultaneously sold to such Purchasing Bank. Upon such
execution, delivery, acceptance and
<PAGE>64
recording, from and after the Transfer Effective Date determined pursuant to
such Commitment Transfer Supplement, (x) the Purchasing Bank thereunder shall
be a party hereto and, to the extent provided in such Commitment Transfer
Supplement, have the rights and obligations of a Bank hereunder with a
Commitment as set forth therein, and (y) the transferor Bank thereunder shall,
to the extent provided in such Commitment Transfer Supplement, be released
from its obligations under this Agreement (and, in the case of a Commitment
Transfer Supplement covering all or the remaining portion of a transferor
Bank's rights and obligations under this Agreement, such transferor Bank shall
cease to be a party hereto). Such Commitment Transfer Supplement shall be
deemed to amend this Agreement to the extent, and only to the extent,
necessary to reflect the addition of such Purchasing Bank and the resulting
adjustment of Commitment Percentages arising from the purchase by such
Purchasing Bank of all or a portion of the rights and obligations of such
transferor Bank under this Agreement and the Notes. On or prior to the
Transfer Effective Date determined pursuant to such Commitment Transfer
Supplement, the Company, at its own expense, shall execute and deliver to the
Administrative Agent in exchange for the surrendered Note a new Note to the
order of such Purchasing Bank in an amount equal to the Commitment assumed by
it pursuant to such Commitment Transfer Supplement and, if the transferor Bank
has retained a Commitment hereunder, a new Note to the order of the transferor
Bank in an amount equal to the Commitment retained by it hereunder. Such new
Notes shall be dated the Closing Date and shall otherwise be in the form of
the Notes replaced thereby. The Note surrendered by the transferor Bank shall
be returned by the Administrative Agent to the Company marked "cancelled".
(d) The Administrative Agent shall maintain at its address referred
to in Section 9.2 a copy of each Commitment Transfer Supplement delivered to
it and a register (the "Register") for the recordation of the names and
addresses of the Banks and the Commitment of, and principal amount of the
Loans owing to, each Bank from time to time. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Company, the
Administrative Agent and the Banks may treat each Person whose name is
recorded in the Register as the owner of the Loan recorded therein for all
purposes of this Agreement. The Register shall be available for inspection by
the Company or any Bank at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of a Commitment Transfer Supplement executed
by a transferor Bank and a Purchasing Bank together with payment to the
Administrative Agent of a registration and processing fee of $4,000, the
Administrative Agent shall (i) promptly accept such Commitment Transfer
Supplement and (ii) on the Transfer Effective Date determined pursuant thereto
record the information contained therein in the Register and give notice of
such acceptance and recordation to the Documentation Agent, the Banks and the
Company.
<PAGE>65
(f) The Company authorizes each Bank to disclose to any Participant
or Purchasing Bank (each, a "Transferee") and any prospective Transferee any
and all financial information in such Bank's possession concerning the Company
and its affiliates which has been delivered to such Bank by or on behalf of
the Company pursuant to this Agreement or which has been delivered to such
Bank by or on behalf of the Company in connection with such Bank's credit
evaluation of the Company and its affiliates prior to becoming a party to this
Agreement; provided, that such Transferee or prospective Transferee agrees in
writing to be bound by the confidentiality provisions set forth in Section
9.14 hereof.
(g) If, pursuant to this Section 9.6, any interest in this
Agreement or any Note is transferred to any Transferee which is organized
under the laws of any jurisdiction other than the United States or any State
thereof, the transferor Bank shall cause such Transferee, concurrently with
the effectiveness of such transfer, (i) to represent to the transferor Bank
(for the benefit of the transferor Bank, the Agents and the Company) that
under applicable law and treaties no taxes will be required to be withheld by
the Administrative Agent, the Company or the transferor Bank with respect to
any payments to be made to such Transferee in respect of the Loans, (ii) to
furnish to the transferor Bank (and, in the case of any Purchasing Bank
registered in the Register, the Administrative Agent and the Company) either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 (wherein such Transferee claims entitlement to complete exemption from
U.S. federal withholding tax on all interest payments hereunder) and an
Internal Revenue Service Form W-8 or W-9 or successor applicable form (wherein
such Transferee claims exemption from United States backup withholding tax)
and (iii) to agree (for the benefit of the transferor Bank, the Agents and the
Company) to provide the transferor Bank (and, in the case of any Purchasing
Bank registered in the Register, the Administrative Agent and the Company) a
new Form 4224 or 1001 or Form W-8 or W-9 upon the expiration or obsolescence
of any previously delivered form and comparable statements in accordance with
applicable U.S. laws and regulations and amendments duly executed and
completed by such Transferee, and to comply from time to time with all
applicable U.S. laws and regulations with regard to such withholding and
backup withholding tax exemptions.
(h) Nothing herein shall prohibit any Bank from pledging or
assigning any Note to any Federal Reserve Bank in accordance with applicable
law.
9.7 Adjustments; Set-off. (a) If any Bank (a "benefitted Bank")
shall receive any payment of all or part of its Loans or interest thereon, or
receive any collateral in respect of its Loans (in each case whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in clause (f) of Section 7, or otherwise)
<PAGE>66
in a greater proportion than any such payment to and collateral received by
any other Bank, if any, in respect of such other Bank's Loans or interest
thereon, or Loans or interest thereon, such benefitted Bank shall purchase for
cash from the other Banks such portion of each such other Bank's Loans, or
shall provide such other Banks with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefitted Bank to
share the excess payment or benefits of such collateral or proceeds ratably
with each of the Banks; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such benefitted Bank,
such purchase shall be rescinded, and the purchase price and benefits
returned, to the extent of such recovery, but without interest. The Company
agrees that each Bank so purchasing a portion of another Bank's Loans may
exercise all rights of payment (including, without limitation, rights of set-
off) with respect to such portion as fully as if such Bank were the direct
holder of such portion.
(b) In addition to any rights and remedies of the Banks provided by
law, each Bank shall have the right, without prior notice to the Company, any
such notice being expressly waived by the Company to the extent permitted by
applicable law, upon any amount becoming due and payable by the Company
hereunder or under the Notes (whether at the stated maturity, by acceleration
or otherwise) to set off and appropriate and apply against such amount any and
all deposits (general or special, time or demand, provisional or final), in
any currency, and any other credits, indebtedness or claims, in any currency,
in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Bank to or for the credit or the
account of the Company. Each Bank agrees promptly to notify the Company and
the Administrative Agent after any such set-off and application made by such
Bank; provided, that the failure to give such notice shall not affect the
validity of such set-off and application.
9.8 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
9.9 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts and all
of said counterparts taken together shall be deemed to constitute one and the
same instrument. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Company and the Agent.
9.10 GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT
<PAGE>67
AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
9.11 Submission To Jurisdiction; Waivers. The Company hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or the Notes, or for recognition
and enforcement of any judgement in respect thereof, to the non-exclusive
general jurisdiction of the courts of the State of New York, the courts
of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be affected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to the
Company at its address set forth in Section 9.2 or at such other address
of which the Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding
referred to in this Section any special, exemplary, punitive or
consequential damages.
9.12 WAIVERS OF JURY TRIAL. THE COMPANY, THE AGENTS AND THE BANKS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES AND FOR ANY COUNTERCLAIM
THEREIN.
9.13 Integration. This Agreement represents the agreement of the
Company, the Agents and the Banks with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by any
Agent or any Bank relative to the subject matter hereof not expressly set
forth or referred to herein or in the Notes.
9.14 Confidentiality. The Banks shall hold all non-public
information obtained pursuant to the requirements of this Agreement which has
been identified as such by the Company in accordance with their customary
procedures for handling
<PAGE>68
confidential information of this nature and in accordance with safe and sound
banking practices but in any event may make disclosure reasonably required by
a bona fide prospective Purchasing Bank or Participant in connection with the
contemplated transfer of any Note or participation therein (subject to such
prospective Purchasing Bank's or Participant's compliance with Section 9.6(f)
hereof) or as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process.
<PAGE>69
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in New York, New York by their proper and duly
authorized officers as of the day and year first above written.
LORAL CORPORATION
By: /s/ Nicholas C. Moren
Title: Vice President and
Treasurer
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation
Agent and as a Bank
By: /s/ Robert M. Osieski
Title: Vice President
CHEMICAL BANK, as
Administrative Agent and as
a Bank
By: /s/ John C. Riordan
Title: Vice President
BARCLAYS BANK PLC, as Agent and
as a Bank
By: /s/ Richard Lane
Title: Associate Director
CONTINENTAL BANK, N.A.,
as Agent and as a
Bank
By: /s/ Kathryn W. Robinson
Title: Vice President
<PAGE>70
ABN AMRO BANK N.V., NEW YORK
BRANCH, as a Bank
By: /s/ Nancy F. Watkins
Title: Group Vice President
By: /s/ Margaret P. Hannahoe
Title: Assistant Vice President
NATIONSBANK OF NORTH CAROLINA,
N.A., as a Bank
By: /s/ Sally L. Hazard
Title: Senior Vice President
DEUTSCHE BANK AG, NEW YORK
AND/OR CAYMAN ISLANDS
BRANCH, as a Bank
By: /s/ Bowen T. Depke
Title: Assistant Vice President
By: /s/ Rolf-Peter Mikolayczyk
Title: Director
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, NEW YORK BRANCH, as
a Bank
By: /s/ Takeshi Kawano
Title: Senior Vice President
ROYAL BANK OF CANADA, as a Bank
By: /s/ Alexander Birr
Title: Senior Manager
BANCA COMMERCIALE ITALIANA,
NEW YORK BRANCH, as a Bank
By: /s/ Charles Dougherty
Title: Vice President
By: /s/ Julia M. Welch
Title: Assistant Vice President
<PAGE>71
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Bank
By: /s/ Thomas J. Somers
Title: Vice President
THE BANK OF NEW YORK, as a Bank
By: /s/ Mary Anne Zagroba
Title: Vice President
BANQUE NATIONALE DE PARIS, as a
Bank
By: /s/ Richard Cushing
Title: Assistant Vice President
By: /s/ Christopher J. Kiely
Title: Vice President
LTCB TRUST COMPANY, as a Bank
By: /s/ John J. Sullivan
Title: Executive Vice
President
PNC BANK, NATIONAL ASSOCIATION,
as a Bank
By: /s/ Mark Williams
Title: Vice President
SOCIETE GENERALE, NEW YORK
BRANCH, as a Bank
By: /s/ Salvatore Galatioto
Title: Vice President
<PAGE>72
J.P. MORGAN DELAWARE, as a Bank
By: /s/ Philip S. Detjens
Title: Vice President
CREDIT LYONNAIS, NEW YORK
BRANCH, as a Bank
By: /s/ Mark Campelloni
Title: Vice President
MELLON BANK, N.A., as a Bank
By: /s/ David R. Evans
Title: Vice President
NATIONAL CITY BANK, as a Bank
By: /s/ Jeffrey J. Tengel
Title: Vice President
THE NIPPON CREDIT BANK, LTD.,
as a Bank
By: /s/ Clifford Abramsky
Title: Vice President and
Manager
BAYERISCHE LANDESBANK
GIROZENTRALE, as a Bank
By: /s/ Wilfried Freudenberger
Title: Executive Vice President
and General Manager
By: /s/ Peter Oberman
Title: First Vice President
Manager Corporate Finance
<PAGE>73
CANADIAN IMPERIAL BANK OF
COMMERCE, (NEW YORK AGENCY),
as a Bank
By: /s/ Brian E. O'Callahan
Title: Authorized Signatory
CREDIT SUISSE, as a Bank
By: /s/ Chris T. Horgan
Title: Associate
By: /s/ Michael C. Mast
Title: Member of Senior Management
THE CHASE MANHATTAN BANK, N.A.,
as a Bank
By: /s/ Patricia B. Bril
Title: Managing Director
THE FUJI BANK, LIMITED, NEW
YORK BRANCH, as a Bank
By: /s/ Takashi Nagao
Title: Vice President and
Manager
THE MITSUBISHI BANK, LIMITED,
NEW YORK BRANCH, as a Bank
By: /s/ J. Bruce Meredith
Title: Senior Vice President
and Manager
THE SANWA BANK LIMITED, as
a Bank
By: /s/ Dominic J. Sorresso
Title: Vice President
<PAGE>74
THE BANK OF NOVA SCOTIA, as a
Bank
By: /s/ Terry K. Fryett
Title: Vice President
SUMITOMO BANK, LIMITED, NEW
YORK BRANCH, as a Bank
By: /s/ E. Sumino
Title: Joint General Manager
WELLS FARGO BANK, N.A., as a Bank
By: /s/ Kathleen J. Harrison
Title: Vice President
<PAGE>75
SCHEDULE I
TO REVOLVING
CREDIT AGREEMENT
Commitments and Commitment Percentages
Commitment
Bank Commitments Percentages
Morgan Guaranty Trust $35,294,100 2.941%
Company of New York
60 Wall Street
New York, New York 10260-0060
Attention: Robert M. Osieski, VP
Telecopy: (212) 648-5014
Domestic Lending Office:
Morgan Guaranty Trust
Company of New York
60 Wall Street
Attention: Loan Department
New York, New York 10260
Eurodollar Lending Office:
Morgan Guaranty Trust
Company of New York
Nassau, Bahamas Office
c/o J.P. Morgan Services, Inc.
Loan Operations - 3rd Floor
500 Stanton Christiana Road
Newark, Delaware 19713
Chemical Bank 67,058,808 5.588%
1375 Broadway
New York, New York 10018
Attention: John C. Riordan, VP
Telecopy: (212) 827-4497
Domestic Lending Office and
Eurodollar Lending Office:
Chemical Bank
270 Park Avenue
New York, New York 10017
Barclays Bank PLC 67,058,808 5.588%
222 Broadway
New York, New York 10038
Attention: S. Clarke Moody,
Director
Telecopy: (212) 412-7580
<PAGE>76
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
Barclays Bank PLC
222 Broadway
New York, New York 10038
Continental Bank, N.A. 67,058,808 5.588%
231 South LaSalle
Chicago, Illinois 60697
Attention: Ken Washington
Telecopy: (312) 828-5140
Domestic Lending Office and
Eurodollar Lending Office:
Continental Bank, N.A.
231 South LaSalle
Chicago, Illinois 60697
Attention: Josephine Guzman
ABN AMRO Bank N.V., 17,647,060 1.471%
New York Branch
500 Park Avenue
2nd Floor
New York, New York 10022
Attention: Margaret P. Hannahoe,
Corporate Banking
Officer
Telecopy: (212) 832-7129
Domestic Lending Office and
Eurodollar Lending Office:
ABN AMRO Bank N.V.
New York Branch
500 Park Avenue
2nd Floor
New York, New York 10022
Nationsbank of North 49,411,768 4.118%
Carolina, N.A.
100 North Tryon Street
Charlotte, NC 28255
Attention: Lisa McClelland
Telecopy: (704) 386-8694
<PAGE>77
Commitment
Bank Commitment Percentages
Domestic Lending Office and
Eurodollar Lending Office:
Nationsbank of North
Carolina, N.A.
100 North Tryon Street
Charlotte, NC 28255
Attention: Lisa McClelland
Telecopy: (704) 386-8694
With Copy to the New York Office:
NationsBank
767 Fifth Avenue
23rd Floor
New York, New York 10153
Attention: Sally Hazard
Telecopy: (212) 593-1083
Deutsche Bank AG 49,411,768 4.118%
New York Branch
31 West 52d Street
24th Floor
New York, New York 10019
Attention: Rolf Peter Mikolayczyk,
VP
Telecopy: (212) 474-8212
Domestic Lending Office:
Deutsche Bank AG, New York Branch
31 West 52nd Street
24th Floor
New York, New York 10019
Eurodollar Lending Office:
Deutsche Bank AG, Cayman Islands Branch
c/o Deutsche Bank AG, New York Branch
31 West 52nd Street
24th Floor
New York, New York 10019
The Industrial Bank 45,882,356 3.824%
of Japan, Limited
New York Branch
245 Park Avenue
New York, New York 10167-0037
Attention: Tomoya Aoki
Telecopy: (212) 856-9450
<PAGE>78
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
The Industrial Bank of Japan,
Limited, New York Branch
245 Park Avenue
New York, New York 10167-0037
Banca Commerciale Italiana 17,647,060 1.471%
New York Branch
One William Street
New York, New York 10004
Attention: Mimi Welch, AVP
Telecopy: (212) 809-2124
Domestic Lending Office and
Eurodollar Lending Office:
Banca Commerciale Italiana
New York Branch
One William Street
New York, New York 10004
Bank of America National 49,411,768 4.118%
Trust and Savings Association
335 Madison Avenue #5727
5th Floor - Unit #5727
New York, New York 10017
Attention: Tom Somers, VP
Telecopy: (212) 503-7031
Domestic Lending Office and
Eurodollar Lending Office:
Bank of America National Trust
and Savings Association
1850 Gateway Boulevard
Concord, California 94520
The Bank of New York 45,882,356 3.824%
One Wall Street
8th Floor
New York, New York 10286
Attention: Kenneth P. Sneider, AVP
Telecopy: (212) 635-1480
<PAGE>79
Commitment
Bank Commitments Percentages
Domestic Lending Office and
Eurodollar Lending Office:
The Bank of New York
One Wall Street
8th Floor
New York, New York 10286
Banque Nationale de Paris 28,235,296 2.353%
499 Park Avenue
7th Floor
New York, New York 10022
Attention: Alex Jackson, AVP
Telecopy: (212) 418-8269
Domestic Lending Office and
Eurodollar Lending Office:
Banque Nationale de Paris
499 Park Avenue
7th Floor
New York, New York 10022
LTCB Trust Company 28,235,296 2.353%
165 Broadway
New York, New York 10006
Attention: Laura Buckley
Telecopy: (212) 608-2371
Domestic Lending Office and
Eurodollar Lending Office:
LTCB Trust Company
165 Broadway
New York, New York 10006
PNC Bank, National Association 45,882,356 3.824%
335 Madison Avenue
10th Floor
New York, New York 10017
Attention: Mark Williams, VP
Telecopy: (212) 557-5461
Domestic Lending Office and
Eurodollar Lending Office:
PNC Bank, National Association
335 Madison Avenue
10th Floor
New York, New York 10017
<PAGE>80
Commitment
Bank Commitments Percentages
Royal Bank of Canada 45,882,356 3.824%
Financial Square
New York, New York 10005
Attention: Alexander Birr
Telecopy: (212) 809-7468
Domestic Lending Office and
Eurodollar Lending Office:
Royal Bank of Canada
Financial Square
New York, New York 10005
Societe Generale 49,411,768 4.118%
New York Branch
50 Rockefeller Plaza
3rd Floor
New York, New York 10020
Attention: Gordon Eadon
Telecopy: (212) 581-8752
Domestic Lending Office and
Eurodollar Lending Office:
Societe Generale
New York Branch
50 Rockefeller Plaza
3rd Floor
New York, New York 10020
J.P. Morgan Delaware 31,764,708 2.647%
902 Market Street
Wilmington, Delaware 19801
Attention: Philip S. Detjens
Telecopy: (302) 654-5336
Domestic Lending Office and
Eurodollar Lending Office:
J.P. Morgan Services, Inc.
500 Stanton-Christiana Road
Newark, Delaware 19713-2107
Attention: Loan Department
Credit Lyonnais 49,411,768 4.118%
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Attention: David Cawrse, VP
Telecopy: (212) 459-3179
<PAGE>81
Commitment
Bank Commitments Percentages
Domestic Lending Office:
Credit Lyonnais
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Eurodollar Lending Office:
Credit Lyonnais
Cayman Island Branch
c/o Credit Lyonnais
New York Branch
1301 Avenue of the Americas
18th Floor
New York, New York 10019
Mellon Bank, N.A. 45,882,356 3.824%
3 Mellon Bank Center
Room # 153-2332
Pittsburgh, Pennsylvania 15258
Attention: F. Lindsay, Loan Admin.
Telecopy: (412) 236-2028
with a copy for credit purposes to:
Mellon Bank, N.A.
Mellon Financial Services
65 East 55th Street
15th Floor
New York, New York 10022-3219
Attention: David R. Evans,
Vice President
Telecopy: (212) 702-5269
Domestic Lending Office and
Eurodollar Lending Office:
Mellon Bank, N.A.
3 Mellon Bank Center
Room # 153-2332
Pittsburgh, Pennsylvania 15258
<PAGE>82
Commitment
Bank Commitment Percentages
National City Bank 21,176,472 1.765%
National City Center
10th Floor
1900 E. 9th Street
Cleveland, Ohio 44114
Attention: Renold D. Thompson, Jr.,
VP
Telecopy: (216) 575-9396
Domestic Lending Office and
Eurodollar Lending Office:
National City Bank
National City Center
10th Floor
1900 E. 9th Street
Cleveland, Ohio 44114
The Nippon Credit Bank, LTD. 28,235,296 2.353%
New York Branch
245 Park Avenue
30th Floor
New York, New York 10167
Attention: Michael Monteleone
Telecopy: (212) 490-3895
Domestic Lending Office and
Eurodollar Lending Office:
The Nippon Credit Bank, LTD.
New York Branch
245 Park Avenue
30th Floor
New York, New York 10167
The Chase Manhattan Bank, N.A. 38,823,532 3.235%
One Chase Manhattan Plaza
5th Floor
New York, New York 10081
Attention: Richard C. Smith
Telecopy: (212) 552-1457
Domestic Lending Office and
Eurodollar Lending Office:
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza
5th Floor
New York, New York 10081
<PAGE>83
Commitment
Bank Commitments Percentages
The Fuji Bank, Limited 35,294,120 2.941%
New York Branch
2 World Trade Center
79th Floor
New York, New York 10048
Attention: Raymond Ventura
Asst. Vice President
Telecopy: (212) 912-0516
Domestic Lending Office and
Eurodollar Lending Office:
The Fuji Bank, Limited
New York Branch
2 World Trade Center
New York, New York 10048
The Sanwa Bank Limited 24,705,884 2.059%
55 East 52nd Street
24th Floor
New York, New York 10055
Attention: Dominic Sorresso
Telecopy: (212) 754-1304
Domestic Lending Office and
Eurodollar Lending Office:
The Sanwa Bank Limited
55 East 52nd Street
24th Floor
New York, New York 10055
Sumitomo Bank, Limited 24,705,884 2.059%
One World Trade Center
Suite 9651
New York, New York 10048
Attention: Diana Hurtzig
Telecopy: (212) 553-0118
Domestic Lending Office and
Eurodollar Lending Office:
Sumitomo Bank, Limited
New York Branch
One World Trade Center
Suite 9651
New York, New York 10048
<PAGE>84
Commitment
Bank Commitments Percentages
Wells Fargo Bank, N.A. 38,823,532 3.235%
Corporate Banking
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Attention: Kathleen Harrison
Vice President
Telecopy: (415) 421-1352
Domestic Lending Office:
Wells Fargo Bank, N.A.
Corporate Banking
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Eurodollar Lending Office:
Wells Fargo Bank, N.A.
Corporate Banking
Attention: Lupe Barajas
420 Montgomery Street
MAC #0101-091
San Francisco, California 94163
Bayerische Landesbank 24,705,884 2.059%
Girozentrale
560 Lexington Avenue
22nd Floor
New York, New York 10022
Attention: Joanne Cicino
Telecopy: (212) 310-9868
Domestic Lending Office:
Bayerische Landesbank
Girozentrale
560 Lexington Avenue
22nd Floor
New York, New York 10022
Eurodollar Lending Office:
Bayerische Landesbank
Girozentrale
Cayman Islands Branch
560 Lexington Avenue
22nd Floor
New York, New York 10022
<PAGE>85
Commitment
Bank Commitments Percentages
Canadian Imperial Bank of 38,823,532 3.235%
Commerce, (New York Agency)
425 Lexington Avenue
6th Floor
New York, New York 10017
Attention: Brian E. O'Callahan
Telecopy: (212) 856-3991
Domestic Lending Office and
Eurodollar Lending Office:
Two Paces West
2727 Paces Ferry Road
Suite 1200
Atlanta, Georgia 30339
Credit Suisse 35,294,120 2.941%
12 East 49th Street
44th Floor
New York, New York 10017
Attention: Chris Horgan
Telecopy: (212) 238-5439
Domestic Lending Office and
Eurodollar Lending Office:
Credit Suisse
12 East 49th Street
44th Floor
New York, New York 10017
The Mitsubishi Bank, Limited, 35,294,120 2.941%
New York Branch
225 Liberty Street
Two World Financial Center
New York, New York 10281
Attention: Mr. J. Bruce Meredith
Senior Vice President
Telecopy: (212) 667-2888
Domestic Lending Office and
Eurodollar Lending Office:
The Mitsubishi Bank, Limited
225 Liberty Street
Two World Financial Center
New York, New York 10281
<PAGE>86
Commitment
Bank Commitments Percentages
The Bank of Nova Scotia 17,647,060 1.471%
One Liberty Plaza
26th Floor
New York, New York 10006
Attention: Dan Foote
Telecopy: (212) 225-5090
Domestic Lending Office and
Eurodollar Lending Office:
The Bank of Nova Scotia
One Liberty Plaza
26th Floor
New York, New York 10006
______________ _______
$1,200,000,000 100.000%
============== =======
<PAGE>87
SCHEDULE 3.1
TO REVOLVING
CREDIT AGREEMENT
=-
CERTAIN LIABILITIES
1. Certain liabilities to be assumed and recorded in connection with the
acquisition of Federal Systems.
<PAGE>88
SCHEDULE 3.13
TO REVOLVING
CREDIT AGREEMENT
CERTAIN SUBSIDIARIES
Be MI AG Olten
Cosmotech
Loral Federal Systems Company
IBM International Air Traffic Corporation*
International Business Machines Aerospace Systems
Integration Corporation*
IBM Federal Sector Services Corporation*
* To be acquired as part of the acquisition of Federal Systems.
<PAGE>89
SCHEDULE 6.4
TO REVOLVING
CREDIT AGREEMENT
EXISTING CONTRACTUAL OBLIGATIONS
1. Sections 2.07 and 2.08, and any other provisions as they relate to
Contractual Obligations, of that certain Stockholders Agreement dated as of
November 13, 1992 by and among Loral Aerospace Holdings, inc., a Delaware
corporation, Loral Aerospace Corp., a Delaware corporation, Loral Corporation,
a New York corporation, Shearson Lehman Brothers Capital Partners II, L.P.,
Lehman Brothers Merchant Banking Portfolio Partnership L.P., Lehman Brothers
Offshore Investment Partnership L.P. and Lehman Brothers Offshore Investment
Partnership-Japan, L.P.
<PAGE>90
SCHEDULE 6.6
TO REVOLVING
CREDIT AGREEMENT
LORAL CORPORATION AND SUBSIDIARIES
Certain Investments as of December 31, 1993
($,000)
Lermer Packaging, Inc. Preferred Stock,
plus accrued dividends $ 5,382
Program Investment in Aircraft Braking
Systems Corporation 3,200
K & F Industries, Inc. 14.75% Convertible
Debentures, plus accrued interest 59,220
Notes Receivable-Various 3,904
Investment in and long-term advances to
Space Systems/Loral, Inc., at cost 137,364
Investment in Consolidated Subsidiaries
Mikrodalga Electronik Sistember Sanayi
Ve Tacaret Anonim Sirketi (50.67%) 5,000
Loral Qualcomm Satellite Services, Inc. 10,234
<PAGE>91
EXHIBIT A
TO REVOLVING
CREDIT AGREEMENT
[FORM OF NOTE]
NOTE
PRINCIPAL AMOUNT:
[PRINCIPAL AMOUNT] New York, New York
($ ) February 23, 1994
BANK: [NAME OF BANK]
FOR VALUE RECEIVED, LORAL CORPORATION, a New York corporation (the
"Company"), hereby unconditionally promises to pay to the order of the Bank
stated above (the "Bank") at the office of Chemical Bank located at 270 Park
Avenue, New York, New York 10017, on February , 1999, in lawful money of
the United States of America and in immediately available funds, the principal
amount of the lesser of (a) the principal amount stated above, and (b) the
aggregate unpaid principal amount of all Loans made by the Bank to the Company
pursuant to Section 2.1(a) of the Revolving Credit Agreement, dated as of
February 23, 1994, among the Company, the Bank, the other financial
institutions parties thereto, Morgan Guaranty Trust Company of New York, as
Documentation Agent, Chemical Bank, as Administrative Agent, and Barclays Bank
PLC and Continental Bank, N.A., as Agents (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"; terms defined
therein being used herein as therein defined unless otherwise defined herein).
The Company further agrees to pay interest in like money at such office on the
unpaid principal amount hereof and, to the extent permitted by applicable law,
overdue accrued interest in respect thereof, from time to time from the date
hereof until such amount is paid in full (whether at the stated maturity, by
acceleration or otherwise) at the rates, for the periods and on the dates
specified in Section 2.9 of the Credit Agreement.
The holder of this Note is authorized to endorse
the date, Type and amount of each Loan made pursuant to Section 2.1(a) of the
Credit Agreement, each continuation thereof, each conversion of all or a
portion thereof to another Type, the date and amount of each repayment of
principal thereof and, in the case of each Eurodollar Loan and C/D Rate Loan,
the length of the Interest Period with respect thereto, on Schedules A, B and
C annexed to, and constituting a part of, this Note, and any such recordation
<PAGE>92
shall constitute prima facie evidence of the accuracy of the information so
recorded; provided, that the failure to record, or the improper recording of,
any such information shall not affect the obligations of the Company under
this Note.
This Note is one of the Notes referred to in the Credit Agreement
and is entitled to the benefits thereof and is subject to prepayment in whole
or in part as provided therein.
Upon the occurrence of any one or more of the Events of Default
specified in the Credit Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all
as provided therein.
All parties now or hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby
waive presentment, demand, protest and all other notices of any kind.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
LORAL CORPORATION
By:
Title:
<PAGE>93
Schedule A to Revolving
Credit Note
BASE RATE LOANS
AND REPAYMENTS OF BASE RATE LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Amount Converted Amount of Amount Converted Amount Converted Unpaid Principal
Amount of Base to Base Rate Principal to Eurodollar to C/D Rate Balance of Base Notation Made
Date Rate Loans Loans Repaid Loans Loans Rate Loans By
</TABLE>
<PAGE>94
Schedule B to Revolving
Credit Note
EURODOLLAR LOANS
AND REPAYMENTS OF EURODOLLAR LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest
Period and Unpaid
Amount Eurodollar Amount Amount Principal
Amount of Converted to Rate with Amount of Converted to Converted to Balance of
Euro-dollar Eurodollar Respect Principal Base Rate C/D Rate Eurodollar Notation
Date Loans Loans Thereto Repaid Loans Loans Loans Made By
</TABLE>
<PAGE>95
Schedule C to Revolving
Credit Note
C/D RATE LOANS
AND REPAYMENTS OF C/D RATE LOANS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Unpaid
Period and C/D Amount Amount Principal
Amount Rate with Amount of Converted to Converted to Balance of
Amount of C/D Converted to Respect Principal Base Rate Eurodollar C/D Rate Notation
Date Rate Loans C/D Rate Loans Thereto Repaid Loans Loans Loans Made By
</TABLE>
<PAGE>96
EXHIBIT B-1
TO REVOLVING
CREDIT AGREEMENT
[FORM OF OPINION OF WILLKIE FARR & GALLAGHER]
February 23, 1994
To the Banks listed on Schedule I
hereto and to the Agents
referred to below
Dear Sirs:
We have acted as counsel to Loral Corporation (the "Company") in
connection with the preparation, negotiation, execution and delivery of the
following documents:
(a) the Revolving Credit Agreement dated as of February 23, 1994 (the
"Credit Agreement") among the Company, the banks from time to time party
thereto (the "Banks"), Morgan Guaranty Trust Company of New York, as
documentation agent for the Banks (the "Documentation Agent"), Chemical
Bank, as administrative agent for the Banks (the "Administrative Agent"),
and Barclays Bank PLC and Continental Bank, N.A., as agents for the Banks
(along with the Administrative Agent and the Documentation Agent, the
"Agents"); and
(b) the Notes of the Company, dated the date hereof (the "Notes").
This opinion is furnished to you pursuant to Section 4.1(b) of the
Credit Agreement. Terms used herein which are defined in the Credit Agreement
shall have the respective meanings set forth in the Credit Agreement, unless
otherwise defined herein.
In connection with this opinion, we have made such examinations of law
and inquiries of officers of the Company and have examined certificates of
public officials, execution copies of the Credit Agreement and the Notes and
such corporate documents and records of the Company and certificates of public
officials and officers of the Company, and such other documents, as we have
deemed necessary or appropriate for the purposes of this opinion. In such
examination, we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals and the conformity to authentic
original documents of all documents submitted to us as certified, conformed or
photostatic copies. As to various questions of fact material to this opinion,
we have relied upon the certifications,
<PAGE>97
representations and warranties of officers and representatives of the Company
and upon the representations and warranties of the Company set forth in the
Credit Agreement.
As used herein, "Indentures" is the collective reference to the 9-1/8%
Indenture, the 7% Indenture and the 8-3/8% Indenture.
A. Based upon and subject to the foregoing, we are of the opinion that:
1. The Company (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, (b) has the
corporate power and authority to own and operate its property and to conduct its
business in the manner in which it is currently conducted, and (c) is duly
qualified as a foreign corporation and in good standing under the laws of New
York, Arizona, California, Washington, D.C., Florida, Maryland, Ohio and
Virginia.
2. The Company has the corporate power and authority to execute, make
and deliver the Credit Agreement and the Notes and to borrow and perform its
obligations under the Credit Agreement and Notes. The Company has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Agreement and the Notes and the borrowings contemplated by the
Credit Agreement. No consent or authorization of, or filing with, any person
pursuant to the Indentures or any Governmental Authority, is required by the
Company or any Subsidiary in connection with the execution, delivery and
performance, validity or enforceability of the Credit Agreement and the Notes
and the borrowings contemplated by the Credit Agreement except for filings which
are contemplated by the Credit Agreement, and filings of UCC financing
statements, if any, necessary in connection with the cash collateralization
contemplated by Section 2.6 of the Credit Agreement.
3. The Credit Agreement and Notes have been duly authorized, executed
and delivered by the Company. Each of the Credit Agreement and the Notes
constitutes a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with their respective terms, except as
provided in paragraph B hereof (other than paragraph B(3)) and except that we
express no opinion as to the enforceability of the last sentence of Section
9.7(a) or Section 9.7(b), to the extent that it purports to grant to any Bank
set-off rights with respect to any amounts owed by the Company under the Credit
Agreement or the Notes to any other Bank, and no opinion is expressed as to the
enforceability of Section 2.9(d) to the extent it purports to specify the rate
of interest payable after judgment, or as to any indemnity provision which
includes indemnities for environmental matters to the extent the same conflicts
with Section 107(e) of CERCLA or any comparable provision of laws of the State
of New York.
<PAGE>98
4. Subject to the qualifications set forth in this paragraph, the
execution, delivery and performance by the Company of the Credit Agreement and
the Notes and the borrowings contemplated by the Credit Agreement will not
violate the restated certificate of incorporation or bylaws of the Company, any
law, rule or regulation of the State of New York or the United States of America
or the General Corporation Law of the State of Delaware or any judgment, decree
or order known to us of any court or governmental or regulatory authority (each
of which is an "Order of Law") or any provision of the Indentures and will not
result in the creation or imposition of any Lien on any of the properties or
revenues of the Company pursuant to any such Order of Law or any provision of
the Indentures. We express no opinion, however, as to any law, rule or
regulation (i) the existence or absence of which does not have any material
adverse effect on the Agents or the Banks and does not deprive the Agents or
the Banks of any material benefit under the Credit Agreement and the Notes,
(ii) which violation or Lien can be readily cured without significant delay or
expense to the Agents or the Banks, without loss to the Agents or the Banks of
any material benefit under the Credit Agreement and the Notes, and without any
material adverse effect on the Agents or the Banks during the period of such
violation or Lien, or (iii) any violation of law, rule or regulation which
results from the status of the Agents or the Banks or facts relating
specifically to the Agents or the Banks.
5. To the best of our knowledge, except as may be described in the
Credit Agreement or in the Company's Form 10-K for the year ended March 31,
1993, no litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or threatened by or against the Company or any
Subsidiary or against any of their respective properties or revenues (a) with
respect to the Credit Agreement and the Notes, or the performance by the Company
of its obligations thereunder, or (b) which, we have been advised by the
officers of the Company, could reasonably be expected to have a material adverse
effect on the business, property or financial condition of the Company and its
Subsidiaries taken as a whole.
6. The Company is not an "investment company" or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
B. The opinions expressed herein, however, are subject
to the following:
1. We are members of the Bar of the State of New York and do not
purport to be experts in the laws of jurisdictions other than the State of New
York, the General Corporation Law of the State of Delaware and the Federal laws
of the United States of America and we do not express any opinion as to the laws
of any jurisdiction other than the present laws of the State of New York, the
General Corporation Law of the State of Delaware and
<PAGE>99
federal laws of the United States, in each case of the type typically applicable
to transactions of the type contemplated by the Credit Agreement and the Notes,
and the present judicial interpretations thereof and to the facts as they
presently exist.
2. The opinions set forth in Paragraph A, insofar as they relate to
the enforceability of the Credit Agreement and the Notes, are subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting or limiting the enforcement of creditors' rights generally and to
equitable principles affecting the availability of equitable relief (regardless
of whether enforcement is considered in a proceeding in equity or at law),
including principles of commercial reasonableness or conscionability and an
implied covenant of good faith and fair dealing. Such principles of equity are
of general application, and in applying such principles, a court, among other
things, might not allow a creditor to accelerate the maturity of a debt for an
immaterial default. Such principles applied by a court might include a
requirement that a creditor act with reasonableness and good faith. Such
requirement might be applied, for example, to any provision of the Credit
Agreement and the Notes purporting to authorize conclusive determinations by any
Bank or any Agent. Insofar as provisions contained in the Credit Agreement
provide for indemnification, the enforcement thereof may be limited by public
policy considerations.
3. We have made no independent investigations except as specifically
set forth herein.
4. We express no opinion as to the effect of the law of any
jurisdiction other than the State of New York wherein any Bank or any Agent (or
any assignee of any of the rights and/or obligations of any Bank or any Agent
under the Credit Agreement and the Notes) may be located or wherein enforcement
of the Credit Agreement and the Notes may be sought which limits the rates of
interest legally chargeable or collectible.
5. We express no opinion as to (i) whether a Federal or state court
outside of the State of New York would give effect to the choice of New York law
provided for in the Credit Agreement and the Notes, (ii) sections of the Credit
Agreement insofar as such sections relate to the subject matter jurisdiction of
the courts specified therein to adjudicate any controversy related to such
Credit Agreement and the Notes, (iii) sections of the Credit Agreement insofar
as such sections relate to the waiver of trial by jury or (iv) the waiver of
defenses and the waiver of objection to venue set forth in the Credit Agreement
with respect to proceedings in the courts specified therein.
6. We have assumed that all parties other than the Company have duly
authorized, executed and delivered the Credit Agreement.
<PAGE>100
7. We have assumed that you, as well as all other parties other than
the Company, have all requisite corporate power and authority and have taken all
necessary action to consummate the transactions contemplated by the Credit
Agreement.
8. This opinion has been issued solely for the benefit of the Agents
and the Banks and no one else has the right to rely upon it. We further advise
you that we are not assuming any obligation to notify the Agents or the Banks of
any changes in this opinion as a result of any facts that may come to our
attention in the future which may cause a change in this opinion.
9. This opinion is limited to matters expressly set forth herein and
no opinion is to be implied or may be inferred beyond the matters expressly
stated herein.
Very truly yours,
WILLKIE FARR & GALLAGHER
By:
A Member of the Firm
<PAGE>101
EXHIBIT B-2
TO REVOLVING
CREDIT AGREEMENT
[FORM OF OPINION OF GENERAL COUNSEL]
February 23, 1994
To the Banks listed on Schedule I
hereto and to the Agents
referred to below
Dear Sirs:
I am Vice President, Assistant Secretary and General Counsel of Loral
Corporation (the "Company") and have acted as such in connection with the
preparation, negotiation, execution and delivery of the following documents:
(a) the Revolving Credit Agreement dated as of February 23, 1994 (the
"Credit Agreement") among the Company, the banks from time to time party
thereto (the "Banks"), Morgan Guaranty Trust Company of New York, as
documentation agent for the Banks (the "Documentation Agent"), Chemical
Bank, as administrative agent for the Banks (the "Administrative Agent"),
and Barclays Bank PLC and Continental Bank, N.A., as agents for the Banks
(along with the Administrative Agent and the Documentation Agent, the
"Agents"); and
(b) the Notes of the Company, dated the date hereof (the "Notes").
This opinion is furnished to you pursuant to Section 4.1(b) of the
Credit Agreement. Terms used herein which are defined in the Credit Agreement
shall have the respective meanings set forth in the Credit Agreement, unless
otherwise defined herein.
In connection with this opinion, I have made such examinations of law
and have examined executed copies of the Credit Agreement and the Notes and such
corporate documents and records of the Company and its Subsidiaries and
certificates of public officials and officers of the Company and its
Subsidiaries, and such other documents, as I have deemed necessary or
appropriate for the purposes of this opinion. In such examination, I have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to me as originals and the conformity to authentic original documents
of all documents submitted to me as certified, conformed or
<PAGE>102
photostatic copies. As to various questions of fact material to this opinion, I
have relied upon certifications of officers and representatives of the Company
and upon the representations of the Company set forth in the Credit Agreement.
A. Based upon and subject to the foregoing, I am of the opinion
that:
1. Each of the Company and each Subsidiary (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its incorporation, (b) has the corporate power and authority to own and
operate its property and to conduct its business in the manner in which it
proposes to do so, and (c) is duly qualified as a foreign corporation and
in good standing under the laws of each jurisdiction where its ownership of
property or the conduct or proposed conduct of its business requires such
qualification, except to the extent that the failure to so qualify could
not reasonably be expected to have a material adverse effect on the
business, operations, property or financial or other condition of the
Company.
2. The Company has the corporate power and authority to execute,
make and deliver the Credit Agreement and the Notes and to borrow and
perform its obligations under the Credit Agreement and Notes. The Company
has taken all necessary corporate action to authorize the execution,
delivery and performance of the Credit Agreement and the Notes and the
borrowings contemplated by the Credit Agreement.
3. The Credit Agreement and Notes have been duly authorized,
executed and delivered by the Company. Each of the Credit Agreement and
the Notes constitutes a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with their respective terms,
except as provided in paragraph B hereof and except that I express no
opinion as to the enforceability of the last sentence of Section 9.7(a) or
Section 9.7(b), to the extent that it purports to grant to any Bank set-off
rights with respect to any amounts owed by the Company under the Credit
Agreement or the Notes to any other Bank, and no opinion is expressed as to
the enforceability of Section 2.9(d) to the extent it purports to specify
the rate of interest payable after judgment, or as to any indemnity
provision which includes indemnities for environmental matters to the
extent the same conflicts with Section 107(e)
<PAGE>103
of CERCLA or any comparable provision of laws of the State of New York.
4. No consent or authorization of, or filing with, any Governmental
Authority or any other Person is required by the Company or any of its
Subsidiaries in connection with the execution, delivery and performance,
validity or enforceability of the Credit Agreement and the Notes and the
borrowings contemplated by the Credit Agreement, except for filings which
are contemplated by the Credit Agreement, and filings of UCC financing
statements, if any, necessary in connection with the cash collateralization
contemplated by Section 2.6 of the Credit Agreement. I express no opinion,
however, as to any such consent, authorization, filing or act (i) the
existence or absence of which does not have any material adverse effect on
the Agents or the Banks and does not deprive the Agents or the Banks of any
material benefit under the Credit Agreement and the Notes or (ii) which can
be readily cured or obtained without significant delay or expense to the
Agents or the Banks, without loss to the Agents or the Banks of any
material benefit under the Credit Agreement and the Notes and without any
material adverse effect on the Agents or the Banks during the period in
which such consent, authorization, filing or act was not obtained or
effected.
5. Subject to the qualifications set forth in this paragraph, the
execution, delivery and performance by the Company of the Credit Agreement
and the Notes and the borrowings contemplated by the Credit Agreement will
not violate the certificate of incorporation, bylaws or other
organizational documents of the Company or any Subsidiary, any law, rule or
regulation of the State of New York or the United States of America or the
General Corporation Law of the State of Delaware or any judgment, decree or
order known to me of any court or governmental or regulatory authority
(each of which is an "Order of Law") or any Contractual Obligation of the
Company or its Subsidiaries, and will not result in the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any such Order of Law or Contractual Obligation. I express no
opinion, however, as to any law, rule or regulation (i) the existence or
absence of which does not have any material adverse effect on the Agents or
the Banks and does not deprive the Agents or the Banks of any material
benefit under the Credit Agreement and the Notes, (ii) which violation or
Lien can be readily cured without significant delay or expense to the
Agents or the Banks, without loss to
<PAGE>104
the Agents or the Banks of any material benefit under the Credit Agreement
and the Notes and without any material adverse effect on the Agents or the
Banks during the period of such violation or Lien, or (iii) any violation
of law, rule or regulation which results from the Agents' or the Banks'
status or facts relating specifically to the Agents or the Banks.
6. To the best of my knowledge, except as may be described in the
Credit Agreement or in the Company's Form 10-K for the year ended March 31,
1993, no litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or threatened by or against
the Company or any Subsidiary or against any of its respective properties
or revenues (a) with respect to the Credit Agreement and the Notes, or the
performance by the Company of its obligations thereunder, or (b) which
could reasonably be expected to have a material adverse effect on the
business, property or financial condition of the Company and its
Subsidiaries taken as a whole.
B. The opinions expressed herein, however, are subject to the
following:
1. I am a member of the Bar of the District of Columbia and do not
purport to be an expert in the laws of jurisdictions other than the
District of Columbia, the General Corporation Law of the State of Delaware
and the Federal laws of the United States of America and I do not express
any opinion as to the laws of any jurisdiction other than the present laws
of the District of Columbia, the State of New York (subject to the
qualification stated below), the General Corporation Law of the State of
Delaware and federal laws of the United States, in each case of the type
typically applicable to transactions of the type contemplated by the Credit
Agreement and the Notes, and the present judicial interpretations thereof
and to the facts as they presently exist. I am not admitted to the Bar of
the State of New York. As to any opinion as to the laws of the State of
New York, I have relied solely on the opinion dated today, a copy of which
is being delivered to you, of Michael B. Targoff, Esq., Senior Vice
President, Secretary and former General Counsel of the Company.
2. The opinions set forth in Paragraph A, insofar as they relate to
the enforceability of the Credit Agreement and the Notes, are subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar
laws
<PAGE>105
affecting or limiting the enforcement of creditors' rights generally and to
equitable principles affecting the availability of equitable relief
(regardless of whether enforcement is considered in a proceeding in equity
or at law), including principles of commercial reasonableness or
conscionability and an implied covenant of good faith and fair dealing.
Such principles of equity are of general application, and in applying such
principles, a court, among other things, might not allow a creditor to
accelerate the maturity of a debt for an immaterial default. Such
principles applied by a court might include a requirement that a creditor
act with reasonableness and good faith. Such requirement might be applied,
for example, to any provision of the Credit Agreement and the Notes
purporting to authorize conclusive determinations by any Bank or any
Agent. Insofar as provisions contained in the Credit Agreement provide for
indemnification, the enforcement thereof may be limited by public policy
considerations.
3. I express no opinion as to the effect of the law of any
jurisdiction other than the State of New York wherein any Bank or any Agent
(or any assignee of any of the rights and/or obligations of any Bank or any
Agent under the Credit Agreement and the Notes) may be located or wherein
enforcement of the Credit Agreement and the Notes may be sought which
limits the rates of interest legally chargeable or collectible.
4. I express no opinion as to (i) whether a Federal or state court
outside of the State of New York would give effect to the choice of New
York law provided for in the Credit Agreement and the Notes, (ii) sections
of the Credit Agreement and the Notes insofar as such sections relate to
the subject matter jurisdiction of the courts specified therein to
adjudicate any controversy related to such Credit Agreement and the Notes,
(iii) sections of the Credit Agreement insofar as such sections relate to
the waiver of trial by jury or (iv) the waiver of defenses and the waiver
of objection to venue set forth in the Credit Agreement with respect to
proceedings in the courts specified therein.
5. I have assumed that all parties other than the Company have duly
authorized, executed and delivered the Credit Agreement.
6. I have assumed that you, as well as all other parties other than
the Company, have all requisite corporate power and authority and have
taken all necessary action to
<PAGE>106
consummate the transactions contemplated by the Credit Agreement.
7. This opinion is limited to matters expressly set forth herein and
no opinion is to be implied or may be inferred beyond the matters expressly
stated herein.
This opinion has been issued solely for the benefit of the Agents and
the Banks and no one else has the right to rely upon it. I further advise you
that I am not assuming any obligation to notify the Agents or the Banks of any
changes in this opinion as a result of any facts that may come to my attention
in the future which may cause a change in this opinion.
Very truly yours,
Eric J. Zahler
General Counsel
<PAGE>107
EXHIBIT C
TO REVOLVING
CREDIT AGREEMENT
[FORM OF CLOSING CERTIFICATE]
CLOSING CERTIFICATE
Pursuant to Section 4.1(c) of the Revolving Credit Agreement (the
"Credit Agreement"; capitalized terms are used herein as therein defined) dated
as of February 23, 1994 among Loral Corporation, a New York corporation (the
"Company"), the Banks parties thereto, Morgan Guaranty Trust Company of New
York, as Documentation Agent, Chemical Bank, as Administrative Agent, and
Barclays Bank PLC and Continental Bank, N.A., as Agents, the undersigned
Nicholas C. Moren, Vice President and Treasurer of the Company, hereby certifies
as follows:
1. The representations and warranties set forth in Section 3 of the
Credit Agreement or which are contained in any certificate, document or
financial or other statement furnished pursuant to or in connection with the
Credit Agreement are true and correct on and as of the date hereof with the same
effect as if made on the date hereof;
2. Immediately prior to and immediately after the making of the
Loans requested to be made on the date hereof, no Default or Event of Default
will have occurred under the Credit Agreement; and
3. Eric J. Zahler is and at all times since July 28, 1992 has been
the duly elected and qualified Vice President, General Counsel and Assistant
Secretary of the Company and the signature set forth on the signature line of
such officer below is such officer's true and genuine signature; and the
undersigned Assistant Secretary of the Company hereby certifies as follows:
(a) There are no liquidation or dissolution proceedings pending or to
my knowledge threatened against the Company, nor has any other event
occurred affecting or threatening the corporate existence of the Company;
(b) The Company is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of New York;
(c) Attached hereto as Exhibit A is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Company on
January 25, 1994; such resolutions have not in any way been rescinded or
modified
<PAGE>108
and have been in full force and effect since their adoption to and
including the date hereof and are now in full force and effect; such
resolutions are the only corporate proceedings of the Company now in force
relating to or affecting the matters referred to therein; attached hereto
as Exhibit B is a true and complete copy of the By-laws of the Company as
in effect on the date such corporate resolutions were adopted through the
date hereof; and attached hereto as Exhibit C is a true and complete copy
of the Amended and Restated Certificate of Incorporation of the Company as
in effect on the date such corporate resolutions were adopted through the
date hereof; and
(d) The persons listed on Schedule I hereto are now duly elected and
qualified officers of the Company, holding the offices indicated next to
their respective names, and such officers have held such offices with the
Company at all times since November 10, 1992 to and including the date
hereof, and the signatures appearing opposite their respective names are
copies of the true and genuine signatures of such officers, and each of
such officers is duly authorized to execute and deliver on behalf of the
Company the Credit Agreement and the Notes of the Company to be issued
pursuant thereto.
IN WITNESS WHEREOF, the undersigned have hereunto set
our names.
Title: Vice President Title: Vice President,
Treasurer General Counsel
and Assistant
Secretary
Date: February 23, 1994
<PAGE>109
EXHIBIT D
TO REVOLVING
CREDIT AGREEMENT
[FORM OF COMMITMENT TRANSFER SUPPLEMENT]
COMMITMENT TRANSFER SUPPLEMENT
COMMITMENT TRANSFER SUPPLEMENT, dated as of the date set forth in Item
1 of Schedule I hereto, among the Transferor Bank set forth in Item 2 of
Schedule I hereto (the "Transferor Bank"), each Purchasing Bank set forth in
Item 3 of Schedule I hereto (each, a "Purchasing Bank"), and CHEMICAL BANK, as
administrative agent for the Banks under the Credit Agreement described below
(in such capacity, the "Administrative Agent").
W I T N E S S E T H :
WHEREAS, this Commitment Transfer Supplement is being executed and
delivered in accordance with subsection 9.6(c) of the Revolving Credit
Agreement, dated as of February 23, 1994, among Loral Corporation, a New York
corporation (the "Company"), the Transferor Bank, the other Banks party thereto,
Morgan Guaranty Trust Company of New York, as Documentation Agent thereunder,
the Administrative Agent, and Barclays Bank PLC and Continental Bank, N.A., as
Agents thereunder (as from time to time amended, supplemented or otherwise
modified in accordance with the terms thereof, the "Credit Agreement"; terms
defined therein being used herein as therein defined);
WHEREAS, each Purchasing Bank (if it is not already a Bank party to
the Credit Agreement) wishes to become a Bank party to the Credit Agreement; and
WHEREAS, the Transferor Bank is selling and assigning to each
Purchasing Bank, rights, obligations and commitments under the Credit Agreement;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Upon receipt by the Administrative Agent of five counterparts of
this Commitment Transfer Supplement, to each of which is attached a fully
completed Schedule I and Schedule II, and each of which has been executed by the
Transferor Bank and each Purchasing Bank (and any other Person required by the
Credit Agreement to execute this Commitment Transfer Supplement), the
<PAGE>110
Administrative Agent will transmit to the Company, the Transferor Bank and each
Purchasing Bank a Transfer Effective Notice, substantially in the form of
Schedule III to this Commitment Transfer Supplement (a "Transfer
Effective Notice"). Such Transfer Effective Notice shall set forth, inter alia,
the date on which the transfer effected by this Commitment Transfer Supplement
shall become effective (the "Transfer Effective Date"), which date shall be the
fifth Business Day following the date of such Transfer Effective Notice unless a
shorter period is agreed to by the Administrative Agent. From and after the
Transfer Effective Date each Purchasing Bank shall be a Bank party to the Credit
Agreement for all purposes thereof.
2. At or before 12:00 Noon, local time of the Transferor Bank, on
the Transfer Effective Date, each Purchasing Bank shall pay to the Transferor
Bank, in immediately available funds, an amount equal to the purchase price, as
agreed between the Transferor Bank and such Purchasing Bank (the "Purchase
Price"), of the portion being purchased by such Purchasing Bank (such Purchasing
Bank's "Purchased Percentage") of the outstanding Loans and other amounts owing
to the Transferor Bank under the Credit Agreement and the Notes. Effective upon
receipt by the Transferor Bank of the Purchase Price from a Purchasing Bank, the
Transferor Bank hereby irrevocably sells, assigns and transfers to such
Purchasing Bank, without recourse, representation or warranty, and each
Purchasing Bank hereby irrevocably purchases, takes and assumes from the
Transferor Bank, such Purchasing Bank's Purchased Percentage of the Commitments
and the presently outstanding Loans and other amounts owing to the Transferor
Bank under the Credit Agreement and the Notes together with all instruments,
documents and collateral security pertaining thereto.
3. The Transferor Bank has made arrangements with each Purchasing
Bank with respect to (i) the portion, if any, to be paid, and the date or dates
for payment, by the Transferor Bank to such Purchasing Bank of any fees
heretofore received by the Transferor Bank pursuant to the Credit Agreement
prior to the Transfer Effective Date and (ii) the portion, if any, to be paid,
and the date or dates for payment, by such Purchasing Bank to the Transferor
Bank of fees or interest received by such Purchasing Bank pursuant to the Credit
Agreement from and after the Transfer Effective Date.
4. (a) All principal payments that would otherwise be payable from
and after the Transfer Effective Date to or for the account of the Transferor
Bank pursuant to the Credit Agreement and its Note shall, instead, be payable to
or for the account of the Transferor Bank and the Purchasing Banks, as the case
may be, in accordance with their respective interests as reflected in this
Commitment Transfer Supplement.
(b) All interest, fees and other amounts that would otherwise accrue
for the account of the Transferor Bank from and
<PAGE>111
after the Transfer Effective Date pursuant to the Credit Agreement and its Note
shall, instead, accrue for the account of, and be payable to, the Transferor
Bank and the Purchasing Banks, as the case may be, in accordance with their
respective interests as reflected in this Commitment Transfer Supplement. In
the event that any amount of interest, fees or other amounts accruing prior to
the Transfer Effective Date was included in the Purchase Price paid by any
Purchasing Bank, the Transferor Bank and each Purchasing Bank will make
appropriate arrangements for payment by the Transferor Bank to such Purchasing
Bank of such amount upon receipt thereof from the Company.
5. On or prior to the Transfer Effective Date, the Transferor Bank
will deliver to the Administrative Agent its Note. On or prior to the Transfer
Effective Date, the Company will deliver to the Administrative Agent Notes for
each Purchasing Bank and the Transferor Bank, in each case in principal amounts
reflecting, in accordance with the Credit Agreement, their Commitments (as
adjusted pursuant to this Commitment Transfer Supplement). As provided in
subsection 9.6(c) of the Credit Agreement, each such new Note shall be dated the
Closing Date. Promptly after the Transfer Effective Date, the Administrative
Agent will send to each of the Transferor Bank and the Purchasing Banks its new
Note, along with a schedule setting forth the amounts of Loans outstanding for
the Transferor Bank and each Purchasing Bank, and will send to the Company the
superseded Note of the Transferor Bank, marked "Cancelled".
6. Concurrently with the execution and delivery hereof, the
Transferor Bank will provide to each Purchasing Bank (if it is not already a
Bank party to the Credit Agreement) conformed copies of all documents delivered
to such Transferor Bank on the Closing Date in satisfaction of the conditions
precedent set forth in the Credit Agreement.
7. Each of the parties to this Commitment Transfer Supplement agrees
that at any time and from time to time upon the written request of any other
party, it will execute and deliver such further documents and do such further
acts and things as such other party may reasonably request in order to effect
the purposes of this Commitment Transfer Supplement.
8. By executing and delivering this Commitment Transfer Supplement,
the Transferor Bank and each Purchasing Bank confirm to and agree with each
other and the Administrative Agent and the Banks as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned hereby free and clear of any adverse claim, the
Transferor Bank 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, the Notes or any other instrument or document
<PAGE>112
furnished pursuant thereto; (ii) the Transferor Bank makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Company or the performance or observance by the Company of any of its
obligations under the Credit Agreement, the Notes or any other instrument or
document furnished pursuant hereto; (iii) each Purchasing Bank confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements referred to in subsection 3.1, the financial statements
delivered pursuant to subsection 5.1, if any, and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Commitment Transfer Supplement; (iv) each Purchasing
Bank will, independently and without reliance upon the Administrative Agent, the
Transferor Bank or any other Bank and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement; (v) each Purchasing
Bank 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, all in accordance with
Section 8 of the Credit Agreement; and (vi) each Purchasing Bank 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 Bank.
9. Each party hereto represents and warrants to and agrees with the
Administrative Agent that it is aware of and will comply with the provision of
subsection 9.6(g) of the Credit Agreement.
10. Schedule II hereto sets forth the revised Commitments and
Commitment Percentages of the Transferor Bank and each Purchasing Bank as well
as administrative information with respect to each Purchasing Bank.
11. THIS COMMITMENT TRANSFER SUPPLEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this Commitment
Transfer Supplement to be executed by their respective duly authorized officers
on Schedule I hereto as of the date set forth in Item 1 of Schedule I hereto.
<PAGE>113
SCHEDULE I
TO
COMMITMENT
TRANSFER
SUPPLEMENT
COMPLETION OF INFORMATION AND
SIGNATURES FOR COMMITMENT
TRANSFER SUPPLEMENT
Re: Revolving Credit Agreement, dated as of
February 23, 1994, with Loral Corporation.
Item 1 (Date of Commitment [Insert date of Commitment
Transfer Supplement): Transfer Supplement]
Item 2 (Transferor Bank): [Insert name of Transferor
Bank]
Item 3 (Purchasing Bank[s]): [Insert name[s] of
Purchasing Bank[s]]
Item 4 (Signatures of Parties
to Commitment Transfer
Supplement):
, as
Transferor Bank
By
Title:
, as a
Purchasing Bank
By
Title:
, as a
Purchasing Bank
By
Title:
<PAGE>114
CONSENTED TO AND ACKNOWLEDGED:
LORAL CORPORATION
By
Title:
CHEMICAL BANK, as
Administrative Agent
By
Title:
[Consents Required only when
Purchasing Bank is not already
a Bank or Affiliate thereof]
ACCEPTED FOR RECORDATION
IN REGISTER:
CHEMICAL BANK, as
Administrative Agent
By
Title:
<PAGE>115
SCHEDULE II
TO COMMITMENT
TRANSFER
SUPPLEMENT
LIST OF LENDING OFFICES, ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
[Name of Transferor
Bank] Revised Commitment Amounts: $
Revised Commitment Percentage:
[Name of Purchasing
Bank] New Commitment Amounts: $
Address for Notices:
New Commitment Percentage:
[Address]
Attention:
Telex:
Answerback:
Telephone:
Telecopier:
Eurodollar Lending Office:
Domestic Lending Office:
<PAGE>116
SCHEDULE III
TO COMMITMENT
TRANSFER
SUPPLEMENT
[Form of Transfer Effective Notice]
To: Loral Corporation, [Transferor Bank
and each Purchasing Bank]
The undersigned, as Administrative Agent under the Revolving Credit
Agreement, dated as of February 23, 1994, among Loral Corporation (the
"Company"), the Banks parties thereto, Morgan Guaranty Trust Company of New
York, as Documentation Agent, Chemical Bank, as Administrative Agent, and
Barclays Bank PLC and Continental Bank, N.A., as Agents, acknowledges receipt of
five executed counterparts of a completed Commitment Transfer Supplement, as
described in Schedule I hereto. [Note: attach copy of Schedule I from
Commitment Transfer Supplement.] Terms defined in such Commitment Transfer
Supplement are used herein as therein defined.
1. Pursuant to such Commitment Transfer Supplement, you are advised
that the Transfer Effective Date will be [Insert fifth business day
following date of Transfer Effective Notice or such shorter period, if any, as
is agreed to by the Administrative Agent]
2. Pursuant to such Commitment Transfer Supplement, the Transferor
Bank is required to deliver to the Administrative Agent on or before the
Transfer Effective Date its Note.
3. Pursuant to such Commitment Transfer Supplement, the Company is
required to deliver to the Administrative Agent on or before the Transfer
Effective Date the following Notes, each dated [Insert Closing
Date]
[Describe each new Note for Transferor Bank and Purchasing Bank as to
principal amount and payee.]
<PAGE>117
4. Pursuant to such Commitment Transfer Supplement each Purchasing
Bank is required to pay its Purchase Price to the Transferor Bank at or before
12:00 Noon on the Transfer Effective Date in immediately available funds.
Very truly yours,
CHEMICAL BANK, as
Administrative Agent
By
Title:
