<PAGE>
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 (Date of earliest event reported):
January 6, 1997 (December 24, 1996)
Mississippi Chemical Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Mississippi 0-20411 64-0292638
----------------- -------------------- ---------------------
(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation)
P.O. Box 388, Yazoo City, Mississippi 39194
--------------------------------------------
(Address of principal executive offices)
(Zip code)
Registrant's telephone number, including area code:
(601) 746-4131
<PAGE>
Item 2. Acquisition or Disposition of Assets.
General. On December 24, 1996, Mississippi Chemical Corporation (the
-------
"Company") completed the acquisition of the fertilizer business of First
Mississippi Corporation ("First Mississippi"). The transaction was effected
through a "Morris Trust" transaction, in which First Mississippi transferred its
nonfertilizer assets to one of its wholly-owned subsidiaries, ChemFirst Inc.
("ChemFirst"), which was spun-off to its existing shareholders by means of a pro
rata dividend distribution of the common stock of ChemFirst (the "Spin-Off").
After the Spin-Off, MISS SUB, INC. ("Sub"), a wholly-owned subsidiary of the
Company, merged into First Mississippi (the "Merger"), which, as the surviving
corporation, became the wholly-owned subsidiary of the Company. This
transaction was consummated pursuant to an Agreement and Plan of Merger and
Reorganization, dated August 27, 1996 (the "Merger Agreement"), among the
Company, Sub, and First Mississippi.
Description of Transaction. Pursuant to the Merger Agreement, and as a
--------------------------
result of the approval by the Company's shareholders of the issuance of shares
of common stock, $0.01 par value per share, of the Company ("Company Common
Stock") in the Merger, each First Mississippi shareholder will receive 0.3340 of
a share of Company Common Stock (the "Exchange Ratio") in exchange for each
whole share of common stock, $1.00 par value per share, of First Mississippi
("First Mississippi Common Stock"). The Exchange Ratio was determined by
dividing the number of shares of Company Common Stock issued to First
Mississippi shareholders pursuant to the Merger by the number of shares of First
Mississippi Common Stock outstanding as of the effective time of the Merger.
Each former First Mississippi shareholder shall be paid an amount in cash
(without interest) in lieu of fractional shares at the rate of $23.7734 per
share of Company Common Stock. Such payments will be made by the Company out of
its working capital.
In addition, the Company guaranteed certain debt of First Mississippi
that was funded through a credit facility pursuant to the terms and provisions
of a Credit Agreement, dated as of December 23, 1996, by and among First
Mississippi and AMPRO Fertilizer, Inc., a wholly-owned subsidiary of First
Mississippi, Harris Trust and Savings Bank, as Administrative Agent, Bank of
Montreal, Chicago Branch, as Syndication Agent, Caisse Nationale de Credit
Agricole and CIBC Inc. as Co-Agents, and the other lenders party thereto (the
"First Mississippi Credit Agreement"). The First Mississippi Credit Agreement
provides for borrowings up to an aggregate of $150,500,000 at varying interest
rates. This figure was determined based upon a formula that took into account
such variables as the average price of Company Common Stock for a ten-day period
preceding the Merger, the costs of obtaining the credit facility, the date of
the Merger, net cash used by the acquired business after a certain date, and
estimated net working capital. The First Mississippi Credit Agreement is
unsecured. In connection with the Merger and the guarantee of debt, the Company
entered into a new Credit Agreement, dated as of December 23, 1996, by and among
the Company, Mississippi Phosphates Corporation, Mississippi Potash, Inc.,
Harris Trust and Savings Bank, as Administrative Agent, Bank of Montreal,
Chicago Branch, as Syndication Agent, Caisse
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Nationale de Credit Agricole and CIBC Inc. as Co-Agents, and the other lenders
party thereto (the "Company Credit Agreement"), which replaces existing
facilities. The Company Credit Agreement provides for borrowings up to an
aggregate of $149,500,000 at varying interest rates. The Company Credit
Agreement is unsecured.
The consideration for the Merger was determined by arm's-length negotiations
between representatives of the Company and First Mississippi based on factors
such as (i) discussions with the respective financial advisors to the Company
and First Mississippi; (ii) the financial condition of the Company and the
fertilizer business of First Mississippi, both on an historical and a
prospective basis; and (iii) historical market prices and trading information
with respect to the Company Common Stock and First Mississippi Common Stock, all
as more fully disclosed in the Joint Proxy Statement/Prospectus of the Company
and First Mississippi dated November 18, 1996.
The Company's shareholders approved the issuance of shares of Company Common
Stock pursuant to the Merger Agreement at the annual meeting held on December
20, 1996. Such approval was required by the Company's listing agreement with
the New York Stock Exchange. First Mississippi's shareholders approved the
Merger and the Merger Agreement at the annual meeting held on December 20, 1996.
At the time of the Merger, First Mississippi, through its wholly-owned
subsidiaries and through ownership interests in other businesses, owned certain
plant, equipment, and other physical property devoted principally to the
production of fertilizer and related products and services. The Company intends
to continue to devote such acquired assets to these purposes.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired (incorporated by reference
from the Company's Registration Statement on Form S-4, Registration
No. 333-16333).
Independent Auditors' Report
First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Balance Sheets as of June 30, 1996 and 1995
First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Statements of Operations for the years ended June
30, 1996, 1995 and 1994
First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Statements of Cash Flows for the years ended June
30, 1996, 1995 and 1994
First Mississippi Fertilizer Business to Be Merged Notes to Special-
Purpose Combined Financial Statements
First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Balance Sheet as of September 30, 1996 (unaudited)
3
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First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Statements of Operations for the three months ended
September 30, 1996 and 1995 (unaudited)
First Mississippi Fertilizer Business to Be Merged Special-Purpose
Combined Statements of Cash Flows for the three months ended
September 30, 1996 and 1995 (unaudited)
(b) Pro Forma Financial Information (incorporated by reference from the
Company's Registration Statement on Form S-4, Registration No. 333-
16333).
Mississippi Chemical Unaudited Condensed Pro Forma Consolidated
Financial Statements
Mississippi Chemical Unaudited Condensed Pro Forma Consolidated
Balance Sheet as of September 30, 1996
Mississippi Chemical Unaudited Condensed Pro Forma Consolidated
Income Statement For the Fiscal Year Ended June 30, 1996
Mississippi Chemical Unaudited Condensed Pro Forma Consolidated
Income Statement For the Three Months Ended September 30, 1996
Notes to Unaudited Condensed Pro Forma Consolidated Financial
Statements
(c) Exhibits
See "Index to Exhibits."
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MISSISSIPPI CHEMICAL CORPORATION
Date: January 6, 1997 By: /s/ Robert E. Jones
--------------------------------------
Robert E. Jones, Senior Vice President
and General Counsel
5
<PAGE>
INDEX TO EXHIBITS
Exhibit 2 Agreement and Plan of Merger and Reorganization,
dated as of August 27, 1996, by and among
Mississippi Chemical Corporation, MISS SUB, INC.,
and First Mississippi Corporation (incorporated by
reference to Appendix A to the Company's
Registration Statement on Form S-4, Registration
No. 333-16333).
Exhibit 10.1 Credit Agreement, dated as of December 23, 1996,
by and among First Mississippi, AMPRO Fertilizer,
Inc., Harris Trust and Savings Bank, as
Administrative Agent, Bank of Montreal, Chicago
Branch, as Syndication Agent, Caisse Nationale de
Credit Agricole and CIBC Inc. as Co-Agents, and
the other lenders party thereto.
Exhibit 10.2 Credit Agreement, dated as of December 23, 1996,
by and among the Company, Mississippi Phosphates
Corporation, Mississippi Potash, Inc., Harris
Trust and Savings Bank, as Administrative Agent,
Bank of Montreal, Chicago Branch, as Syndication
Agent, Caisse Nationale de Credit Agricole and
CIBC Inc. as Co-Agents, and the other lenders
party thereto.
Exhibit 23 Consent of KPMG Peat Marwick LLP.
6
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EXHIBIT 10.1
===============================================================================
Credit Agreement
Among
First Mississippi Corporation
AMPRO Fertilizer, Inc.
And
The Lenders Party Hereto
And
Harris Trust and Savings Bank,
as Administrative Agent
And
Bank of Montreal, Chicago Branch,
as Syndication Agent
And
Caisse Nationale de Credit Agricole
CIBC Inc.
as Co-Agents
Dated as of December 23, 1996
================================================================================
<PAGE>
TABLE OF CONTENTS
FIRST MISSISSIPPI CORPORATION
AMPRO FERTILIZER, INC.
CREDIT AGREEMENT
<TABLE>
<S> <C> <C>
SECTION 1. THE REVOLVING CREDIT............................................................................1
Section 1.1. The Revolving Credit........................................................................1
Section 1.2. Extension of Termination Date...............................................................2
Section 1.3. Interest Rates..............................................................................4
(a) Base Rate Loans.............................................................................4
(b) Eurodollar Loans............................................................................4
(c) Default Rate................................................................................4
Section 1.4. Conversion and Continuation of Loans........................................................4
Section 1.5. Manner of Borrowing Revolving Credit Loans..................................................5
Section 1.6. Capital Adequacy............................................................................6
Section 1.7. Absolute Obligations........................................................................7
Section 1.8. The Spun-Off Entities.......................................................................7
SECTION 2. THE BID FACILITY................................................................................8
Section 2.1. The Bid Loans...............................................................................8
Section 2.2. Requests for Bid Loans......................................................................8
(a) Requests and Confirmations..................................................................8
(b) Invitation to Bid...........................................................................8
(c) Bids........................................................................................9
Section 2.3. Notice of Bids..............................................................................9
Section 2.4. Acceptance or Rejection of Bids.............................................................9
Section 2.5. Notice of Acceptance or Rejection of Bids..................................................10
(a) Notice to Banks Making Successful Bids.....................................................10
(b) Notice to all Banks........................................................................10
(c) Disbursement of Bid Loans..................................................................10
(d) Interest on Bid Loans......................................................................11
Section 2.6. Telephonic Notice..........................................................................11
SECTION 3. THE NOTES, FEES, PREPAYMENTS, TERMINATIONS AND APPLICATION OF PAYMENTS.........................11
Section 3.1. The Notes..................................................................................11
Section 3.2. Facility Fee...............................................................................12
Section 3.3. Agent's Fees...............................................................................12
Section 3.4. 12
(a) Optional Prepayments of Base Rate Loans....................................................12
</TABLE>
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<TABLE>
<S> <C> <C>
(b) Optional Prepayments of Eurodollar Loans...................................................13
(c) Mandatory Prepayments of Excess Borrowings.................................................13
Section 3.5. Revolving Credit Termination...............................................................13
Section 3.6. Place and Application of Payments..........................................................13
Section 3.7. Closing Fee................................................................................14
SECTION 4. DEFINITIONS....................................................................................14
Section 4.1. Certain Definitions........................................................................14
Section 4.2. Accounting Terms...........................................................................23
SECTION 5. REPRESENTATIONS AND WARRANTIES.................................................................23
Section 5.1. Organization and Qualification; Non-Contravention..........................................23
Section 5.2. Financial Reports..........................................................................23
Section 5.3. Litigation; Tax Returns; Approvals.........................................................24
Section 5.4. Regulation U...............................................................................24
Section 5.5. No Default.................................................................................24
Section 5.6. ERISA......................................................................................25
Section 5.7. Debt and Security Interests................................................................25
Section 5.8. Subsidiaries and Guarantors................................................................25
Section 5.9. Accurate Information.......................................................................25
Section 5.10. Enforceability.............................................................................25
Section 5.11. Restrictive Agreements.....................................................................26
Section 5.12. No Violation of Law........................................................................26
Section 5.13. No Default Under Other Agreements..........................................................26
Section 5.14. Status Under Certain Laws..................................................................26
SECTION 6. CONDITIONS PRECEDENT...........................................................................26
Section 6.1. Initial Extension of Credit................................................................26
Section 6.2. Each Extension of Credit...................................................................28
Section 6.3. Legal Matters..............................................................................29
Section 6.4. Documents..................................................................................29
SECTION 7. COVENANTS......................................................................................29
Section 7.1. Maintenance of Property....................................................................29
Section 7.2. Taxes......................................................................................29
Section 7.3. Maintenance of Insurance...................................................................30
Section 7.4. Financial Reports..........................................................................30
Section 7.5. Inspection.................................................................................30
Section 7.6. Consolidation and Merger...................................................................30
Section 7.7. Transactions with Affiliates...............................................................31
Section 7.8. Liens......................................................................................31
Section 7.9. Borrowings and Guaranties..................................................................33
Section 7.10. Investments, Loans, Advances and Acquisitions..............................................33
Section 7.11. Sale of Property...........................................................................35
Section 7.12. Notice of Suit or Adverse Change in Business or Default....................................35
</TABLE>
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<TABLE>
<S> <C> <C>
Section 7.13. ERISA......................................................................................35
Section 7.14. Use of Proceeds............................................................................36
Section 7.15. Compliance with Laws, etc..................................................................36
Section 7.16. Sale and Leaseback Transactions............................................................36
Section 7.17. Triad Chemical Product Withdrawal Agreement................................................36
Section 7.18. Fiscal Quarters............................................................................36
Section 7.19 New Subsidiaries...........................................................................36
Section 7.20. Dividends and Certain Other Restricted Payments............................................36
SECTION 8. EVENTS OF DEFAULT AND REMEDIES..................................................................36
Section 8.1. Definitions................................................................................36
Section 8.2. Remedies for Non-Bankruptcy Defaults.......................................................38
Section 8.3. Remedies for Bankruptcy Defaults...........................................................38
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING FIXED RATE LOANS..............................................39
Section 9.1. Change of Law..............................................................................39
Section 9.2. Unavailability of Deposits or Inability to Ascertain the Adjusted Eurodollar Rate..........39
Section 9.3. Taxes and Increased Costs..................................................................39
Section 9.4. Funding Indemnity..........................................................................40
Section 9.5. Lending Branch.............................................................................41
Section 9.6. Discretion of Bank as to Manner of Funding.................................................41
Section 9.7. Mitigation of Circumstances................................................................41
SECTION 10. THE AGENTS......................................................................................42
Section 10.1. Appointment and Powers.....................................................................42
Section 10.2. Powers.....................................................................................42
Section 10.3. General Immunity...........................................................................43
Section 10.4. No Responsibility for Loans, Recitals, etc.................................................43
Section 10.5. Right to Indemnity.........................................................................43
Section 10.6. Action Upon Instructions of Banks..........................................................43
Section 10.7. Employment of Agents and Counsel...........................................................43
Section 10.8. Reliance on Documents; Counsel.............................................................43
Section 10.9. May Treat Payee as Owner...................................................................44
Section 10.10. Agents' Reimbursement......................................................................44
Section 10.11. Rights as a Bank...........................................................................44
Section 10.12. Bank Credit Decision.......................................................................44
Section 10.13. Resignation of Agent.......................................................................44
Section 10.14. Duration of Agency.........................................................................45
Section 10.15. Syndication Agent and Co-Agents...........................................................45
SECTION 11. MISCELLANEOUS...................................................................................45
Section 11.1. Amendments and Waivers.....................................................................45
Section 11.2. Waiver of Rights...........................................................................45
Section 11.3. Several Obligations........................................................................46
</TABLE>
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<TABLE>
<S> <C> <C>
Section 11.4. Non-Business Day...........................................................................46
Section 11.5. Documentary Taxes..........................................................................46
Section 11.6. Representations............................................................................46
Section 11.7. Notices....................................................................................46
Section 11.8. Costs and Expenses; Indemnity..............................................................46
Section 11.9. Counterparts...............................................................................48
Section 11.10. Successors and Assigns.....................................................................48
Section 11.11. No Joint Venture...........................................................................48
Section 11.12. Severability...............................................................................48
Section 11.13. Table of Contents and Headings.............................................................48
Section 11.14. Sharing of Payments........................................................................48
Section 11.15. Jurisdiction...............................................................................49
Section 11.16. Participants and Note Assignees............................................................49
Section 11.17. Assignment of Commitments by Banks.........................................................49
Signature Page...............................................................................................50
Exhibit A Revolving Credit Note
Exhibit B Bid Loan Request Confirmation
Exhibit C Invitation to Bid
Exhibit D Confirmation of Bid
Exhibit E Notice of Acceptance of Bid
Exhibit F Schedule of Subsidiaries and Guarantors
Exhibit G Compliance Certificate
Exhibit H Form of Legal Opinion of Borrowers' Counsel
Exhibit I Form of Legal Opinion of Guarantors' Counsel
Schedule 5.3. Litigation & Tax Disclosures
Schedule 6.1(i) Real Property Subject to a Phase I Environmental Assessment
</TABLE>
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First Mississippi Corporation
AMPRO Fertilizer, Inc.
Credit Agreement
Harris Trust and Savings Bank
Chicago, Illinois
The from time to time lenders parties hereto
Ladies and Gentlemen:
The undersigned First Mississippi Corporation, a Mississippi
corporation (the "Company"), and AMPRO Fertilizer, Inc., a Louisiana corporation
("AMPRO") and, together with the Company, individually a "Borrower" and
collectively the "Borrowers"), apply to you for your several commitments,
subject to all the terms and conditions hereof and on the basis of the
representations and warranties hereinafter set forth, to make a revolving credit
(the "Revolving Credit"), and a competitive bid facility (the "Bid Facility")
available to the Borrowers, all as more fully hereinafter set forth. Each of
you is hereinafter referred to individually as "Bank" and collectively as
"Banks." Harris Trust and Savings Bank in its individual capacity is sometimes
referred to herein as "Harris", and in its capacity as Administrative Agent for
the Banks is hereinafter in such capacity called the "Administrative Agent."
Bank of Montreal in its capacity as Syndication Agent for the Banks is
hereinafter in such capacity called the "Syndication Agent." Caisse Nationale
de Credit Agricole and CIBC Inc., in their capacity as Co-Agents for the Banks
are hereinafter in such capacity collectively called the "Co-Agents." All
capitalized terms not defined in the text of this Agreement are defined in
Section 4 hereof.
Section 1. The Revolving Credit.
Section 1.1. The Revolving Credit.; (a) Subject to all of the terms
and conditions hereof, the Banks agree, severally and not jointly, to extend a
Revolving Credit to the Borrowers which may be utilized by the Borrowers in the
form of loans (individually a "Revolving Credit Loan" and collectively the
"Revolving Credit Loans"). The aggregate principal amount of all Loans (as
hereinafter defined) at any time outstanding may not exceed the sum of the
Revolving Credit Commitments (as hereinafter defined) at any time. The
Revolving Credit shall be available to the Borrowers, and may be availed of by
the Borrowers from time to time, be repaid (subject to the restrictions on
prepayment set forth herein) and used again, during the period from the date
hereof to and including December 23, 2001 (as the same may be extended from time
to time in accordance with the provisions of Section 1.2 hereof, the
"Termination Date"), at which
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time the entire outstanding principal amount of all Loans, together with all
accrued and acquired interest thereon, shall be due and payable.
(b) The respective maximum aggregate principal amounts of the
Revolving Credit at any one time outstanding and the percentage (the "Commitment
Percentage") of the Revolving Credit available at any time which each Bank by
its acceptance hereof severally agrees to make available to the Borrowers are as
follows (collectively, the "Revolving Credit Commitments" and individually, a
"Revolving Credit Commitment"):
<TABLE>
<CAPTION>
<S> <C> <C>
Harris Trust and Savings Bank $20,066,666.69 13.33333334%
Caisse Nationale de Credit Agricole $18,812,500.00 12.50000000%
CIBC Inc. $18,812,500.00 12.50000000%
Banque Nationale de Paris, $12,541,666.66 8.33333333%
Houston Agency
Bank of America Illinois $10,033,333.33 6.66666667%
Commerzbank Aktiengesellschaft $10,033,333.33 6.66666667%
Atlanta Agency
Banque Paribas $7,525,000.00 5.00000000%
The Bank of Nova Scotia, Atlanta Agency $7,525,000.00 5.00000000%
SunTrust Bank, Atlanta $7,525,000.00 5.00000000%
First Union National Bank of
North Carolina $7,525,000.00 5.00000000%
ABN AMRO Bank N.V. $7,525,000.00 5.00000000%
The Fuji Bank, Limited $7,525,000.00 5.00000000%
The Dai-Ichi Kangyo Bank, Ltd. $5,016,666.66 3.33333333%
Hibernia National Bank $5,016,666.66 3.33333333%
Deposit Guaranty National Bank $5,016,666.66 3.33333333%
Total $150,500,000.00 100.00000000%
</TABLE>
(c) Loans under the Revolving Credit may be Eurodollar Loans or Base
Rate Loans. Each Borrowing under the Revolving Credit shall be made by each Bank
in an amount equal to its Commitment Percentage of the amount of such Borrowing.
Each Borrowing of Base Rate Loans under the Revolving Credit shall be in an
amount not less than $5,000,000 or such greater amount which is an integral
multiple of $1,000,000 and each Borrowing of Eurodollar Loans shall be in an
amount not less than $10,000,000 or such greater amount which is an integral
multiple of $1,000,000.
Section 1.2. Extension of Termination Date. At any time not earlier
than 120 days prior to, nor later than 90 days prior to, each date that is four
years before the Termination Date then in effect (each an "Anniversary Date"),
the Borrowers may request that the Banks extend the then scheduled Termination
Date to the date one year from such Termination Date. Each such request by the
Borrowers shall be deemed to be a representation and warranty by the Borrowers
to the Banks that no material adverse change in the financial condition of
Chemical and its Subsidiaries, taken as a whole, has occurred since the date of
the most recent financial reports delivered to the Banks in accordance with
Section 7.4(b) hereof. If such request is made
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by the Borrowers each Bank shall inform the Administrative Agent of its
willingness to extend the Termination Date no later than 30 days after the Banks
receive such request. Any Bank's failure to respond by such date shall indicate
its unwillingness to agree to such requested extension. At any time more than 30
days before such Anniversary Date Banks having aggregate Commitment Percentages
of at least 80% of the Revolving Credit Commitments then in effect (the
"Extending Banks") may propose, by written notice to the Borrowers, an extension
of this Agreement to the date one year from the applicable Termination Date on
such terms and conditions as the Extending Banks may then require. If the
extension of this Agreement to such later date is acceptable to the Borrowers on
the terms and conditions proposed by the Extending Banks, the Borrowers shall
notify the Extending Banks of their acceptance of such terms and conditions no
later than the Anniversary Date, and such later date will become the Termination
Date hereunder and this Agreement shall otherwise be amended in the manner
described in the Extending Banks' notice proposing the extension of this
Agreement upon the Agent's receipt of (i) an amendment to this Agreement signed
by the Borrowers and all of the Extending Banks, (ii) resolutions of each
Borrower's Board of Directors authorizing such extension and (iii) an opinion of
counsel to the Borrowers equivalent in form and substance to the form of opinion
attached hereto as Exhibit I and otherwise acceptable to the Extending Banks. If
the Borrowers and the Extending Banks agree upon the terms of an extension of
the Termination Date, the Borrowers may elect either (i) to terminate the
Revolving Credit Commitments of each Bank that is not an Extending Bank (each a
"Nonextending Bank") in whole on such Anniversary Date, at which time all Loans
and other amounts payable under the Loan Documents to the Nonextending Banks
shall become immediately due and payable, or (ii) to replace such Nonextending
Banks with one or more financial institutions acceptable to the Borrowers and
the Administrative Agent (each a "Replacement Bank"). If the Borrowers elect to
replace a Nonextending Bank, such replacement shall become effective as of the
date the Nonextending Banks' Revolving Credit Commitments terminate (which shall
be no later than the Anniversary Date) and all of the following conditions are
satisfied:
(A) the unpaid principal amount of all Loans made by each
Nonextending Bank whose Revolving Credit Commitment is to terminate,
together with accrued interest thereon and all other amounts payable under
the Loan Documents to such Nonextending Bank, including any facility fee
accrued through the date of such termination, shall have been paid in full
and all of such Nonextending Banks' participations in L/Cs shall have
reallocated among the Extending Banks;
(B) such Replacement Bank shall agree in writing to be bound by all
of the terms and provisions of this Agreement, such agreement to specify
the amount of the Revolving Credit Commitment of such Replacement Bank and
to be otherwise in form and substance satisfactory to the Administrative
Agent, and shall make Loans to the Borrowers in principal amounts which
bear the same ratio to the amounts of the Loans made by the other Extending
Banks then outstanding as the Revolving Credit Commitment of such
Replacement Bank bears to the then Revolving Credit Commitments of all
other Extending Banks; and
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(C) a copy of such agreement and of evidence satisfactory to the
Administrative Agent of the making of such Loans shall be furnished to the
Administrative Agent and the Extending Banks.
Section 1.3. Interest Rates. (a) Base Rate Loans. Each Base Rate Loan
shall bear interest (computed on the basis of a year of 365/366 days and actual
days elapsed) on the unpaid principal amount thereof from the date such Loan is
made until maturity (whether by acceleration, upon prepayment or otherwise) at a
rate per annum equal to the sum of the Applicable Margin and the Base Rate from
time to time in effect, payable monthly in arrears on the last day of each
calendar month, commencing on the first of such dates occurring after the date
hereof and at maturity (whether by acceleration, upon prepayment or otherwise).
(b) Eurodollar Loans. Each Eurodollar Loan under the Revolving Credit
shall bear interest (computed on the basis of a year of 360 days and actual days
elapsed) on the unpaid principal amount thereof from the date such Loan is made
until the last day of the Interest Period applicable thereto or, if earlier,
until maturity (whether by acceleration or otherwise) at a rate per annum equal
to the sum of the Applicable Margin and the Adjusted Eurodollar Rate, payable on
the last day of each Interest Period applicable thereto or at maturity (whether
by acceleration or otherwise) and, with respect to Eurodollar Loans with an
Interest Period in excess of three months, on the date occurring every three
months from the first day of the Interest Period applicable thereto.
(c) Default Rate. If any Event of Default shall have occurred, all Loans
shall bear interest from the date such Event of Default occurred, payable on
demand, at a rate per annum equal to:
(i) with respect to any Base Rate Loan, the sum of 2% plus the Base
Rate (computed on the basis of a year of 365/366 days and actual days
elapsed) from time to time in effect; and
(ii) with respect to any Fixed Rate Loan, the sum of 2% plus the rate
of interest in effect thereon at the time of such default (computed on the
basis of a year of 360 days and actual days elapsed) until the end of the
Interest Period then applicable thereto, and, thereafter, at a rate per
annum equal to the sum of 2% plus the Base Rate (computed on the basis of a
year of 365/366 days and actual days elapsed) from time to time in effect.
Section 1.4. Conversion and Continuation of Loans. (a) Provided that no
Event of Default or Potential Default has occurred and is continuing, the
Borrowers shall have the right, subject to the other terms and conditions of
this Agreement, to continue in whole or in part (but, if in part, in the minimum
amount specified for Eurodollar Loans in Section 1.1 hereof) any Eurodollar Loan
from any current Interest Period into a subsequent Interest Period, provided
that such Borrower shall give the Administrative Agent notice of the
continuation of any such Loan as provided in Section 1.5 hereof.
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(b) In the event that a Borrower fails to give notice pursuant to Section
1.5 hereof of the continuation of any Eurodollar Loan or fails to specify the
Interest Period applicable thereto, or an Event of Default or Potential Default
has occurred and is continuing at the time any such Loan is to be continued
hereunder, then such Loan shall be automatically converted as (and the relevant
Borrower shall be deemed to have given notice requesting) a Base Rate Loan,
subject to Sections 8.2 and 8.3 hereof, unless paid in full on the last day of
the then applicable Interest Period.
(c) Provided that no Event of Default or Potential Default has occurred and
is continuing, the Borrowers shall have the right, subject to the terms and
conditions of this Agreement, to convert Revolving Credit Loans of one type (in
whole or in part) into Revolving Credit Loans of another type from time to time
provided that: (i) the Borrower shall give the Administrative Agent notice of
each such conversion as provided in Section 1.5 hereof, (ii) the principal
amount of any Revolving Credit Loan converted hereunder shall be in an amount
not less than the minimum amount specified for the type of Loan in Section 1.1
hereof, (iii) after giving effect to any such conversion in part, the principal
amount of any Eurodollar Loan then outstanding shall not be less than the
minimum amount specified for a Eurodollar Loan in Section 1.1 hereof, (iv) any
conversion of a Loan hereunder shall only be made on a Business Day, and (v) any
Eurodollar Loan may be converted only on the last day of the Interest Period
then applicable thereto.
Section 1.5. Manner of Borrowing Revolving Credit Loans. (a) The Company
shall give telephonic, telex or telecopy notice to the Administrative Agent
(which notice, if telephonic, shall be promptly confirmed in writing) no later
than (i) 12:00 Noon (Chicago time) on the date the Banks are requested to make
each Borrowing of Base Rate Loans, and (ii) 12:00 Noon (Chicago time) on the
date at least three (3) Business Days prior to the date of (A) each Borrowing of
Eurodollar Loans which the Banks are requested to make or continue, and (B) the
conversion of any Borrowing of Base Rate Loans into a Borrowing of Eurodollar
Loans. Each such notice shall be irrevocable and shall specify the Borrower
requesting such Borrowing, the date of the Borrowing requested (which shall be a
Business Day), the amount of such Borrowing, whether the Borrowing is to be made
available by means of Base Rate Loans or Eurodollar Loans and, with respect to a
Borrowing of Eurodollar Loans, the Interest Period applicable thereto; provided,
that in no event shall the principal amount of any requested Revolving Credit
Loan plus the aggregate principal amount of all Loans outstanding hereunder
exceed the Revolving Credit Commitments as such amounts may be reduced pursuant
to Section 3.5 of this Agreement. The Borrowers agree that the Administrative
Agent may rely on any such telephonic, telex or telecopy notice given by any
person who the Administrative Agent reasonably believes is authorized to give
such notice without the necessity of independent investigation and in the event
any notice by such means conflicts with the written confirmation, such notice
shall govern if the Administrative Agent or any Bank has acted in reliance
thereon. The Administrative Agent shall, on the day any such notice is received
by it, give prompt telephonic, telex or telecopy (if telephonic, to be confirmed
in writing within one Business Day) notice of the receipt of notice from the
Company hereunder to each of the Banks.
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(b) Subject to the provisions of Section 6 hereof, the proceeds of each
Borrowing of Revolving Credit Loans shall be made available to the relevant
Borrower at the principal office of the Administrative Agent in Chicago,
Illinois, by depositing immediately available funds into an account maintained
by such Borrower with the Administrative Agent, on the date such Borrowing is
requested to be made. Not later than 3:00 p.m. Chicago time, on the date
specified for any Borrowing of Revolving Credit Loans to be made hereunder, each
Bank shall make its Loan comprising part of such Borrowing available to the
Borrowers in immediately available funds at the principal office of the
Administrative Agent.
(c) Unless the Administrative Agent shall have been notified by a Bank
prior to the date of a Revolving Credit Loan to be made by such Bank (which
notice shall be effective upon receipt) that such Bank does not intend to make
the proceeds of such Revolving Credit Loan available to the Administrative
Agent, the Administrative Agent may assume that such Bank has made such proceeds
available to the Administrative Agent on such date and the Administrative Agent
may in reliance upon such assumption (but shall not be required to) make
available to the relevant Borrower a corresponding amount. If such corresponding
amount is not in fact made available to the Administrative Agent by such Bank,
the Administrative Agent shall be entitled to receive such amount on demand from
such Bank (or, if such Bank fails to pay such amount forthwith upon such demand,
to recover such amount, together with interest thereon at the rate otherwise
applicable thereto under Section 1.3 hereof, from the relevant Borrower)
together with interest thereon in respect of each day during the period
commencing on the date such amount was made available to a Borrower and ending
on the date the Administrative Agent recovers such amount, at a rate per annum
equal to the effective rate charged to the Administrative Agent for overnight
Federal funds transactions with member banks of the Federal Reserve System for
each day, as determined by the Administrative Agent (or, in the case of a day
which is not a Business Day, then for the preceding Business Day) (the "Fed
Funds Rate"). Nothing in this Section 1.5(c) shall be deemed to permit any Bank
to breach its obligations to make Revolving Credit Loans under the Revolving
Credit, or to limit any Borrower's claims against any Bank for such breach.
Section 1.6. Capital Adequacy. If, after the date hereof, any Bank or the
Administrative Agent shall have determined in good faith that the adoption of
any applicable law, rule or regulation regarding capital adequacy, or any change
therein (including, without limitation, any revision in the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal Reserve System (12
CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of the Office of the
Comptroller of the Currency (12 CFR Part 3, Appendix A), or in any other
applicable capital rules heretofore adopted and issued by any governmental
authority), or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Bank's capital, or on the capital of any corporation controlling such
Bank, in each case as a consequence of its obligations hereunder, to a level
below that which such Bank would have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect
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to capital adequacy) by an amount deemed by such Bank to be material, then from
time to time if such Bank is generally imposing payments for such reduction on
its similarly situated customers, within thirty (30) days after demand by such
Bank (with a copy to the Administrative Agent), the Borrowers shall pay to such
Bank such additional amount or amounts as will compensate such Bank for such
reduction.
Section 1.7. Absolute Obligations. Each Borrower acknowledges and agrees
that its joint and several liability on the Notes and on all obligations owed by
any Borrower or Borrowers under this Agreement is absolute and unconditional and
shall not in any manner be affected or impaired by any acts or omissions
whatsoever by the Banks, and without limiting the generality of the foregoing,
each Borrower's joint and several liability on the Notes and under this
Agreement shall not be impaired by any acceptance by the Banks of any other
security for or guarantors upon the Notes or any obligations under this
Agreement or by any failure, neglect or omission on the Banks' part to resort to
any one or all of the Borrowers for payment of the Notes or the obligations
under this Agreement or to realize upon or protect any collateral security
therefor. Each Borrower's joint and several liability on the Notes and under
this Agreement shall not in any manner be impaired or affected by who receives
or uses the proceeds of the loans evidenced by the Notes or for what purposes
such proceeds are used, and each Borrower waives notice of borrowing requests
issued by, and loans made to, other Borrowers. Such joint and several liability
of each Borrower shall also not be impaired or affected by (and each Bank,
without notice to anyone, is hereby authorized to make from time to time) any
sale, pledge, surrender, compromise, settlement, release, renewal, extension,
indulgence, alteration, substitution, exchange, change in, modification or
disposition of any collateral security for the Notes or the obligations under
this Agreement or of any guaranty thereof. In order to enforce payment of the
Notes and the Borrowers' obligations under this Agreement, foreclose or
otherwise realize on any collateral security therefor, and to exercise the
rights granted to any Agent hereunder and thereunder and under applicable law,
the Agents shall be under no obligation at any time to first resort to any
collateral security, property, liens or any other rights or remedies whatsoever,
and the Banks shall have the right to enforce the Notes and the Borrowers'
obligations under this Agreement irrespective of whether or not other
proceedings or steps are pending seeking resort to or realization upon or from
any of the foregoing. By its acceptance below, each Borrower hereby expressly
waives and surrenders any defense to its joint and several liability on the
Notes or under this Agreement based upon any of the foregoing. In furtherance
thereof, each Borrower agrees that wherever in this Agreement it is provided
that a Borrower is liable for a payment such obligation is the joint and several
obligation of each Borrower.
Section 1.8. The Spun-Off Entities. The Agents and the Banks acknowledge
and agree that, once the Spin-Off has occurred, none of the terms of this
Agreement shall be binding thereupon, or applied to, any of the properties or
businesses that are the subject of the Spin-Off, and notwithstanding any other
provision of this Agreement, neither the Borrowers or any of their Subsidiaries
or their Affiliates shall be deemed to violate any statement, representation,
warranty or covenant as a result of the completion of the Spin-Off, the
Acquisition or any of the transactions contemplated thereby, nor should the
Spin-Off, the Acquisition or any of the transactions contemplated thereby
constitute an Event of Default hereunder.
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Section 2. The Bid Facility.
Section 2.1. The Bid Loans. At any time before the Termination Date, the
Company may request the Banks to offer to make uncommitted loans (each such loan
being hereinafter referred to as a "Bid Loan" and collectively as the "Bid
Loans") in the manner set forth in Sections 2.1 through 2.6 hereof and in
amounts such that the Total Outstandings hereunder shall not exceed the sum of
the Revolving Credit Commitments then in effect after taking into account any
Loans to be paid with such Bid Loans. The Banks may, but shall have no
obligation to, make such offers and the Borrowers may, but shall have no
obligation to, accept any such offers in the manner set forth in Sections 2.1
through 2.6 hereof. Each Bank may offer to make Bid Loans in any amount
(whether greater than, equal to, or less than its Revolving Credit Commitment),
subject to the limitation that the Total Outstandings under this Agreement may
not at any time exceed the sum of the Revolving Credit Commitments then in
effect. Bid Loans may either bear interest at a stated rate per annum ("Stated
Rate Bid Loans") or at a margin (the "Bid Margin") over or under the Adjusted
Eurodollar Rate ("Eurodollar Bid Loans"); provided that there may be no more
than five different Interest Periods for Bid Loans outstanding at the same time
and that no Bid Loan may mature after the Termination Date.
Section 2.2. Requests for Bid Loans.
(a) Requests and Confirmations. In order to request a Borrowing of Bid Loans
(a "Bid Loan Request") the Company shall give telephonic, telex or telecopy
notice to the Administrative Agent by no later than 1:00 p.m. (Chicago time) on
the date at least one Business Day in the case of Stated Rate Bid Loans, and
three Business Days in the case of Eurodollar Bid Loans, before the date of the
requested Bid Borrowing (the "Borrowing Date"). Each such request shall be
followed on the same day by a duly completed Bid Loan Request Confirmation,
delivered by telecopier or other means of facsimile communication, substantially
in the form of Exhibit B hereto or otherwise containing the information required
by this Section, to be received by the Administrative Agent no later than 1:30
p.m. (Chicago time). Bid Loan Request Confirmations that do not conform
substantially to the format of Exhibit B may be rejected by the Administrative
Agent, and the Administrative Agent shall give telephonic notice to the Company
of such rejection promptly after it determines that the Bid Loan Request
Confirmation does not substantially conform to the format of Exhibit B. Bid
Loan Requests shall in each case refer to this Agreement and specify (i) the
proposed Borrowing Date (which must be a Business Day), (ii) the aggregate
principal amount thereof (which shall not be less than $5,000,000 and thereafter
in integral multiples of $1,000,000) and (iii) the proposed Interest Period
thereof.
(b) Invitation to Bid. Upon receipt by the Administrative Agent of a Bid
Loan Request Confirmation that conforms substantially to the format of Exhibit B
hereto or is otherwise acceptable to the Administrative Agent, the
Administrative Agent shall, by telephone, promptly confirmed by a telecopy or
other form of facsimile communication in the form of Exhibit C hereto, invite
each Bank to bid, on the terms and conditions of this Agreement, to make Bid
Loans pursuant to the Bid Loan Request no later than 3:00 p.m. (Chicago time) on
the date the Administrative Agent receives such Bid Loan Request.
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(c) Bids. Each Bank may, in its sole discretion, offer to make a Bid Loan or
Bid Loans (a "Bid") to the applicable Borrower responsive to the Bid Loan
Request. Each Bid by a Bank must be received by the Administrative Agent by
telephone not later than 8:45 a.m. (Chicago time) on the Business Day following
the date the Administrative Agent receives a Bid Loan Request from the Company
(the "Auction Date"), promptly confirmed in writing by a duly completed
Confirmation of Bid delivered by telecopier or other means of facsimile
communication substantially in the form of Exhibit D hereto, to be received by
the Administrative Agent on the same day; provided, however, that any Bid made
by the Administrative Agent must be made by telephone to the Company by no later
than fifteen minutes prior to the time that Bids from the other Banks are
required to be received. Each Bid and each Confirmation of Bid shall refer to
this Agreement and specify (i) the principal amount of each Bid Loan that the
Bank is willing to make to the Company and the type of Bid Loan (i.e., Stated
Rate or Eurodollar), (ii) the interest rate (which shall be computed on the
basis of a 360-day year and actual days elapsed and, in the case of a Eurodollar
Bid Loan, shall be expressed in terms of the Bid Margin to be added to or
subtracted from the Adjusted Eurodollar Rate for the Interest Period to be
applicable to such Eurodollar Bid Loan) at which the Bank is prepared to make
each Bid Loan and (iii) the Interest Period applicable thereto. The
Administrative Agent shall reject any Bid if such Bid (i) does not specify all
of the information specified in the immediately preceding sentence, (ii)
contains any qualifying, conditional, or similar language, (iii) proposes terms
other than or in addition to those set forth in the Bid Loan Request to which it
responds, or (iv) is received by the Administrative Agent later than the times
provided for above. Any Bid submitted by a Bank pursuant to this Section 2.2
shall be irrevocable and shall be promptly confirmed by a telecopy or other form
of facsimile communication in the form of Exhibit D, provided that in all events
the telephone Bid received by the Administrative Agent shall be binding on the
relevant Bank and shall not be altered, modified, or in any other manner
affected by any inconsistent terms contained in, or terms missing from, the
Bank's Confirmation of Bid. Each offer contained in a Bid to make a Bid Loan in
a certain amount, at a certain interest rate, and for a certain Interest Period
is referred to herein as an "Offer".
Section 2.3. Notice of Bids; Advice of Rate. The Administrative Agent shall
give telephonic notice to the Company of the number of Bids made, the terms of
the Offers contained in such Bids (including the interest rate(s) and Interest
Period(s) applicable to each Bid, the maximum principal amount bid at each
interest rate for each Interest Period, and the identity of the Bank making such
Bid), such notice to be given by 9:15 a.m. (Chicago time) on the Auction Date.
The Administrative Agent shall send a written summary of all Bids received by it
to the Company by 2:00 p.m. (Chicago time) on the same day. The interest rates
quoted for Eurodollar Bid Loans shall be expressed in terms of the Bid Margin to
be added to or subtracted from the Adjusted Eurodollar Rate to be applicable to
such Bid Loan.
Section 2.4. Acceptance or Rejection of Bids. The Company may in its sole
and absolute discretion, subject only to the provisions of this Section,
irrevocably accept or reject any Offer contained in a Bid. No later than the
later of 9:45 a.m. (Chicago time) or 30 minutes after receipt of telephonic
notice of bids on the Auction Date, the Company shall give telephonic notice to
the Administrative Agent of whether and to what extent it has decided to accept
or
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reject any or all of the Offers contained in the Bids made in response to the
related Bid Loan Request, which notice shall be promptly confirmed by telecopier
or other form of facsimile communication to be received by the Administrative
Agent on the proposed Borrowing Date; provided, however, that (a) the Company
shall accept Offers for any of the maturities specified by the Company in the
related Bid Loan Request Confirmation solely on the basis of ascending interest
rates for each such Interest Period for each Stated Rate Bid Loan or Eurodollar
Bid Loan as the case may be for such Interest Period, (b) if the Company
declines to borrow, or if it is restricted by any other condition hereof from
borrowing, the maximum principal amount of Bid Loans in respect of which Offers
at a particular interest rate for a particular Interest Period have been made,
then the Company shall accept a pro rata portion of each such Offer, based as
nearly as possible on the ratio of the maximum aggregate principal amounts of
Bid Loans for which each such Offer was made by each Bank (provided that, if the
available principal amount of Bid Loans to be so allocated is not sufficient to
enable Bid Loans to be so allocated to each relevant Bank in integral multiples
of $1,000,000, then the Company may round allocations up or down in integral
multiples not less than $100,000 as it shall deem appropriate), (c) the
aggregate principal amount of all Offers accepted by the Company shall not
exceed the maximum amount contained in the related Bid Loan Request
Confirmation, and (d) no Offer of a Bid Loan shall be accepted in a principal
amount less than $1,000,000 and thereafter in integral multiples of $500,000
(provided that such Offer may be rounded up or down as provided for in (b)
above). Any telephone notice given by the Company pursuant to this Section
shall be irrevocable and shall not be altered, modified, or in any other manner
affected by any inconsistent terms contained in, or terms missing from, any
written confirmation of such notice.
Section 2.5. Notice of Acceptance or Rejection of Bids.
(a) Notice to Banks Making Successful Bids. The Administrative Agent shall
give telephonic notice to each Bank if any of the Offers contained in its Bid
have been accepted (including the amount, the applicable interest rate and
Interest Period for each accepted Offer) no later than 10:15 a.m. (Chicago time)
on the Auction Date, and each successful bidder will thereupon become bound,
subject to Section 6 and the other applicable conditions hereof, to make the Bid
Loan(s) in respect of which its Offer has been accepted. As soon as practicable
thereafter the Administrative Agent shall send a Notice of Acceptance of Bid
substantially in the form of Exhibit E hereto to each such successful bidder;
provided, however, that failure to give such Notice of Acceptance shall not
affect the obligation of such successful bidder to disburse its Bid Loans as
herein required.
(b) Notice to all Banks. As soon as practicable after each Borrowing Date
for Bid Loans, the Administrative Agent shall notify each Bank (whether or not
its Bid or its Bids were successful) of the aggregate amount of Bid Loans
advanced pursuant to the relevant Bid Loan Request on such Borrowing Date, the
maturities thereof, and the lowest and highest interest rates at which Bid Loans
were made for each maturity.
(c) Disbursement of Bid Loans. Not later than 1:30 p.m. (Chicago time) on
the Borrowing Date for each Borrowing of a Bid Loan(s), each Bank bound to make
a Bid Loan(s) in accordance with Section 2.5(a) shall, subject to Section 6 and
the other applicable conditions
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hereof, make available to the Administrative Agent the principal amount of each
such Bid Loan in immediately available funds at the Administrative Agent's
principal office in Chicago, Illinois. The Administrative Agent shall promptly
thereafter make available to the Company like funds as received from each Bank,
at such office of the Administrative Agent in Chicago, Illinois.
(d) Interest on Bid Loans. Each Borrower, jointly and severally, shall pay
interest on the unpaid principal amount of each Bid Loan from the applicable
Borrowing Date to the maturity thereof at the rate of interest applicable to
such Bid Loan as determined pursuant to the above provisions (calculated on the
basis of a 360 day year and the actual number of days elapsed) payable on the
last day of the Interest Period applicable to such Bid Loan and at maturity
(whether by acceleration or otherwise), and, if the applicable Interest Period
is longer than 90 days, on each day occurring every 90 days after the date such
Loan is made.
Section 2.6. Telephonic Notice. Each Bank's telephonic notice to the
Administrative Agent of its Bid pursuant to Section 2.2(c) hereof, and the
Company's telephonic acceptance of any Offer contained in a Bid pursuant to
Section 2.4 hereof, shall be irrevocable and binding on such Bank and the
Company and shall not be altered, modified, or in any other manner affected by
any inconsistent terms contained in, or missing from, any telecopy or other
confirmation of such telephonic notice. It is understood and agreed by the
parties hereto that the Administrative Agent shall be entitled to act (or to
fail to act) hereunder in reasonable reliance on its records of any telephonic
notices provided for herein and that the Administrative Agent shall not incur
any liability to any Person in so doing if its records conflict with any
telecopy or other confirmation of a telephone notice or otherwise, provided that
the Administrative Agent has acted (or failed to act) in good faith. It is
further understood and agreed by the parties hereto that the times of day as set
forth in this Section 2.6 are for the convenience of all the parties for
providing notices and that no party shall incur any liability or other
responsibility for any failure to provide such notices within the specified
times; provided, however, that the Administrative Agent shall have no obligation
to notify the Company of any Bid received by it later than 8:45 a.m. (Chicago
time) on the Auction Date, and no acceptance by the Company of any Offer
contained in such a Bid shall be effective to bind any Bank to make a Bid Loan,
nor shall the Administrative Agent be under any obligation to notify any Person
of an acceptance, if notice of such acceptance is received by the Administrative
Agent later than the later of 9:45 a.m. (Chicago time) or 30 minutes after
receipt of telephonic notice of bids on the Auction Date.
Section 3. The Notes, Fees, Prepayments, Terminations and Application of
Payments.
Section 3.1. The Notes. All Loans made by each Bank to the Borrowers
hereunder shall be evidenced by a single Revolving Credit Note of the Borrowers,
jointly and severally, substantially in the form of Exhibit A hereto
(individually, a "Revolving Note" or "Note" and together, the "Revolving Notes"
or "Notes") payable to the order of such Bank, but the aggregate principal
amount of indebtedness evidenced by such Revolving Note at any time shall be,
and the same is to be determined by, the aggregate principal amount of all Loans
made by such Bank to the Borrowers pursuant hereto on or prior to the date of
determination less the
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aggregate amount of principal repayments on such Loans received by or on behalf
of such Bank on or prior to such date of determination. Each Revolving Note
shall be dated as of the execution date of this Agreement, shall be delivered
concurrently herewith, and shall be expressed to mature on the Termination Date
and to bear interest as provided in Sections 1.3 and 2 hereof. Each Bank shall
record on its books or records or on a schedule to its Revolving Note the amount
of each Loan made by it hereunder and all payments of principal and interest and
the principal balance from time to time outstanding, provided that prior to any
transfer of such Revolving Note all such amounts shall be recorded on a schedule
to such Revolving Note. The record thereof, whether shown on such books or
records or on a schedule to the Revolving Note, shall be prima facie evidence as
to all such amounts; provided, however, that the failure of any Bank to record
any of the foregoing shall not limit or otherwise affect the joint and several
obligation of the Borrowers to repay all Loans made hereunder together with
accrued interest thereon. Upon the request of any Bank, the Borrowers will
furnish a new Revolving Note to such Bank to replace its outstanding Revolving
Note and at such time the first notation appearing on the schedule on the
reverse side of, or attached to, such Revolving Note shall set forth the
aggregate unpaid principal amount of all Loans then outstanding from such Bank.
Such Bank will cancel the outstanding Revolving Credit Note upon receipt of the
new Revolving Note.
Section 3.2. Facility Fee. For the period from the date hereof to and
including the Termination Date, or such earlier date on which the Revolving
Credit is terminated in whole pursuant to Section 3.5 hereof, the Borrowers,
jointly and severally, shall pay to the Administrative Agent for the account of
the Banks a facility fee with respect to the Revolving Credit at the rate per
annum (computed on a basis of a year of 365/366 days for the actual number of
days elapsed) equal to the Applicable Margin in effect from time to time of the
maximum amount of the Revolving Credit Commitments, calculated without regard to
whether any credit is available or outstanding under the Revolving Credit
(determined in each case after giving effect to any reductions thereof as
specified in Section 3.5 hereof). Such fee shall be payable quarterly in
arrears on the last day of each March, June, September and December commencing
on the last day of December, 1996, and on the Termination Date, unless the
Revolving Credit is terminated in whole on an earlier date, in which event the
fees for the period from the date of the last payment made pursuant to this
Section 3.2 through the effective date of such termination in whole shall be
paid on the date of such earlier termination in whole.
Section 3.3. Agent's Fees. The Borrowers shall pay to and for the sole
account of the appropriate Agent such fees as the Borrowers and such Agent may
agree upon in writing from time to time. Such fees shall be in addition to any
fees and charges the Agents may be entitled to receive under the other Loan
Documents.
Section 3.4. (a) Optional Prepayments of Base Rate Loans.. The Borrowers
shall have the privilege of prepaying without premium or penalty and in whole or
in part (but if in part, then in a minimum principal amount of $5,000,000 or
such greater amount which is an integral multiple of $1,000,000) any Borrowing
of Base Rate Loans at any time upon prior telecopy or telephonic notice from the
Company to the Administrative Agent on or before 11:00 a.m. (Chicago time) on
the Business Day of such prepayment. Any amount prepaid under the
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Revolving Credit may, subject to the terms and conditions of this Agreement, be
borrowed, repaid and borrowed again.
(b) Optional Prepayments of Eurodollar Loans. The Borrowers may prepay any
borrowing of Eurodollar Loans, upon telephonic notice (which shall be promptly
confirmed in writing by facsimile communication, telex or telegraph) by no later
than 11:00 a.m. (Chicago time) on the date of such prepayment from the Company
to the Administrative Agent, such prepayment to be made by the payment of the
principal amount to be prepaid and accrued interest thereon and any compensation
required by Section 9.4 hereof, if applicable; provided, however, that any such
prepayment shall be in a principal amount of no less than $10,000,000 or such
greater amount which is an integral multiple of $1,000,000, and after giving
effect to any such prepayment the outstanding principal amount of any such
borrowing of Eurodollar Loans prepaid in part shall not be less than $10,000,000
or such greater amount which is an integral multiple of $1,000,000.
(c) Mandatory Prepayments of Excess Borrowings. If at any time the Total
Outstandings hereunder shall exceed the Revolving Credit Commitments, the
Borrowers shall immediately prepay Loans outstanding for each Borrower's account
in an amount equal to such excess.
Section 3.5. Revolving Credit Termination. The Borrowers shall have the
right at any time upon 5 days' prior notice to the Banks to terminate the
Revolving Credit in whole or in part (but if in part in a minimum principal
amount of $10,0000,000 or such greater amount which is an integral multiple of
$5,000,000); provided, however, that the Borrowers may not terminate any portion
of the Revolving Credit which represents outstanding Loans unless the Borrowers
contemporaneously prepay the same.
Section 3.6. Place and Application of Payments. All payments by the
Borrowers hereunder shall be made to the Administrative Agent at its office at
111 West Monroe Street, Chicago, Illinois 60690 and in immediately available
funds, prior to 12:00 noon on the date of such payment. All such payments shall
be made without setoff or counterclaim and without reduction for, and free from,
any and all present and future levies, imposts, duties, fees, charges,
deductions withholdings, restrictions or conditions of any nature imposed by any
government or any political subdivision or taxing authority thereof. Any
payments received after 12:00 noon Chicago time (or after any later time the
Banks may otherwise direct) shall be deemed received upon the following Business
Day. The Administrative Agent shall remit to each Bank its proportionate share
of each payment of principal, interest and facility fees received by the
Administrative Agent by 3:00 P.M. Chicago time on the same day of its receipt
and its proportionate share of each such payment received by the Administrative
Agent after 12:00 noon on the Business Day following its receipt by the
Administrative Agent. In the event the Administrative Agent does not remit any
amount to any Bank when required by the preceding sentence, the Administrative
Agent shall pay to such Bank interest on such amount until paid at a rate per
annum equal to the Fed Funds Rate. Each Borrower hereby authorizes the
Administrative Agent to automatically debit its designated account with Harris
for any principal,
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interest and fees when due under the Notes or this Agreement and to transfer the
amount so debited from such account to the Administrative Agent for application
as herein provided.
Section 3.7. Closing Fee. The Company shall pay to the Administrative Agent
for the ratable account of the Banks a closing fee in an amount equal to 0.025%
of the aggregate amount of all of the Revolving Credit Commitments, payable upon
the execution and delivery of this Agreement.
Section 4. Definitions.
Section 4.1. Certain Definitions. The terms hereinafter set forth when
used herein shall have the following meanings:
"Acquisition" shall mean the acquisition of the Company by Chemical pursuant
to the terms and conditions of the Acquisition Documents through the merger
after the Spin-Off of MISS SUB, INC., a wholly owned subsidiary of Chemical,
with and into the Company.
"Acquisition Documents" shall mean the First Mississippi Purchase Agreement,
the Agreement and Plan of Distribution (the "Distribution Agreement") dated as
of December 18, 1996 by and between the Company and ChemFirst Inc.
("ChemFirst"), a wholly owned Subsidiary of the Company, the Tax Disaffiliation
Agreement dated as of December 18, 1996 by and between the Company and
ChemFirst, and the Employee Benefits and Compensation Agreement dated as of
December 18, 1996 by and between the Company and ChemFirst.
"Adjusted Eurodollar Rate" means a rate per annum determined pursuant to the
following formula:
Adjusted Eurodollar Rate = Eurodollar Rate
-------------------------
100% - Reserve Percentage
"Administrative Agent" shall have the meaning specified in the first
paragraph of this Agreement.
"Affiliate" shall mean, for any Person, any other Person (including all
directors and officers of such Person) that directly or indirectly controls, or
is under common control with, or is controlled by, such Person. As used in this
definition, "control" means the power, directly or indirectly, to direct or
cause the direction of management or policies of a Person (through ownership of
voting securities, by contract or otherwise), provided that, in any event for
purposes of the definition any Person that owns directly or indirectly 10% or
more of the securities having ordinary voting power for the election of
directors of a corporation or 10% or more of the partnership or other ownership
interests of any other Person will be deemed to control such corporation or
other Person.
"Agents" shall mean the Administrative Agent and the Syndication Agent.
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<PAGE>
"Agreement" shall mean this Credit Agreement as supplemented and amended from
time to time.
"Applicable Margin" shall mean, with respect to the Facility Fee and each
type of Loan described below, the rate of interest per annum shown below for the
range of Pricing Ratio specified below:
<TABLE>
<CAPTION>
Level I Level II Level III Level IV Level V
<S> <C> <C> <C> <C> <C>
Pricing (less than)0.75x (greater than (greater than (greater than
Ratio or equal to) 0.75x and or equal to) 1.50x and or equal to) 2.25x and (greater than)3.00x
(less than) 1.50x (less than) 2.25x (less than
or equal to) 3.00x
Fed Funds Rate .15% .25% .475% .675% 1.00%
Loans
Base Rate Loans 0% 0% 0% 0% .25%
Eurodollar Loans .15% .25% .475% .675% 1.00%
Facility Fee .10% .12% .15% .20% .25%
</TABLE>
The Applicable Margins will be adjusted upon receipt of Chemical's quarterly
Compliance Certificate (as defined in the Guaranty) or Pricing Ratio Certificate
(as defined in the Guaranty) for the fiscal quarter ended December 31, 1996 and
at the close of every fiscal quarter thereafter. Not later than 5 Business Days
after receipt by the Administrative Agent of the certificates called for by
Section 3.4(c) or (f) of the Guaranty for each fiscal quarter, the
Administrative Agent shall determine the Pricing Ratio for the applicable period
and shall promptly notify Chemical and the Banks of such determination and of
any change in the Applicable Margins resulting therefrom. Any such change in
the Applicable Margins shall be effective as of the forty-fifth (45th) day
following the close of each fiscal quarter with respect to all Revolving Credit
Loans outstanding on such date, and such new Applicable Margins shall continue
in effect until the forty-fifth (45th) day following the close of the next
succeeding fiscal quarter. Each determination of the Pricing Ratio and
Applicable Margins by the Administrative Agent in accordance with this Section
shall be conclusive and binding on the Borrowers and the Banks absent manifest
error. From the date hereof until the Applicable Margins are first adjusted
pursuant hereto, the Applicable Margins shall be those set forth in Level II
above.
"Bank" and "Banks" shall have the meanings specified in the first paragraph of
this Agreement.
"Base Rate" means for any day the rate of interest announced by Harris from
time to time as its prime commercial rate in effect on such day, with any change
in the Base Rate resulting from a change in said prime commercial rate to be
effective as of the date of the relevant change in said prime commercial rate
(the "Harris Prime Rate"), provided that if the rate per annum determined by
adding 1/2 of 1% to the rate at which Harris would offer to sell federal funds
in the interbank market on or about 10:00 A.M. (Chicago time) on any day (the
"Adjusted Fed Funds Rate") shall be higher than the Harris Prime Rate on such
day, then the Base Rate for such day and for the succeeding day which is not a
Business Day shall be such Adjusted Fed Funds Rate. The determination of the
Adjusted Fed Funds Rate by the
15
<PAGE>
Administrative Agent shall be final and conclusive provided it has acted in
good faith in connection therewith.
"Base Rate Loan" shall mean a Revolving Credit Loan which bears interest as
provided in Section 1.3(a) hereof.
"Bid Loan" shall have the meaning specified in Section 2.1 hereof.
"Borrower" and "Borrowers" shall have the meaning specified in the first
paragraph of this Agreement.
"Borrowing" means the total of Loans of a single type made by the Banks to any
Borrower on a single date and for a single Interest Period. Borrowings of
Revolving Credit Loans are made ratably from the Banks according to their
Revolving Credit Commitments. Borrowings of a Bid Loan or Bid Loans are made
from a Bank or Banks in accordance with the procedures of Section 2 hereof.
"Business Day" shall mean any day except Saturday or Sunday on which banks are
open for business in Chicago, Illinois, and, with respect to Eurodollar Loans
and Eurodollar Bid Loans, dealing in United States dollar deposits in London,
England and Nassau, Bahamas.
"Capitalized Lease" shall mean any lease or obligation for rentals which is
required to be capitalized on a consolidated balance sheet of a Person and its
Subsidiaries in accordance with generally accepted accounting principles,
consistently applied.
"Capitalized Lease Obligation" shall mean the present discounted value of the
rental obligations under any Capitalized Lease.
"Change of Control" shall mean that after the Acquisition is completed
Chemical and its Subsidiaries, or any Subsidiary of Chemical, shall fail to have
legal and beneficial ownership of all of the issued and outstanding shares of
capital stock of the Company for any reason other than a merger or similar
transaction permitted by Section 7.6(b) of this Agreement.
"Chemical" shall mean Mississippi Chemical Corporation, a Mississippi
corporation.
"Chemical Credit Agreement" shall mean that certain Credit Agreement dated as
of even date herewith among Chemical, Mississippi Phosphates Corporation, a
Delaware corporation, and Mississippi Potash, Inc., a Mississippi corporation,
the lenders party thereto, Harris, as Administrative Agent and Bank of Montreal,
as Syndication Agent, as supplemented and amended from time to time.
"Commitment Percentage" shall have the meaning set forth in Section 1.1(b)
hereof.
"Compliance Certificate" shall mean a Compliance Certificate in the form of
Exhibit G attached hereto.
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<PAGE>
"Debt" of any Person shall mean as of any time the same is to be determined,
the aggregate (without duplication) of:
(a) all indebtedness, obligations and liabilities with respect to
borrowed money;
(b) all guaranties (other than guaranties to be assumed by ChemFirst as
part of the Spin-off), endorsements (other than any liability arising out of
the endorsement of items for deposit or collection in the ordinary course of
business) and other contingent obligations in respect of, or any obligations
to purchase or otherwise acquire, indebtedness or securities of others or to
purchase Property of others at the request or demand of any creditor of such
Person;
(c) all reimbursement and other obligations with respect to letters of
credit (whether drawn or undrawn), banker's acceptances, customer advances
and other extensions of credit whether or not representing obligations for
borrowed money;
(d) the aggregate amount of Capitalized Lease Obligations;
(e) all indebtedness and liabilities secured by any lien or any security
interest on any Property or assets of such person, whether or not the same
would be classified as a liability on a balance sheet; and
(f) all indebtedness, obligations and liabilities representing the
deferred purchase price of Property, excluding trade payables incurred in
the ordinary course of business not more than 90 days past due;
all computed and determined on a consolidated basis for such Person and its
Subsidiaries after the elimination of intercompany items in accordance with
generally accepted accounting principles consistent with those used in the
preparation of the audit report referred to in Section 5.2 hereof.
"EBITDA" means, for any Person and with reference to any period, Net Income
for such period plus all amounts deducted in arriving at such Net Income amount
in respect of (i) Interest Expense for such period, plus (ii) federal, state and
local income taxes for such period, plus (iii) all amounts properly charged for
depreciation of fixed assets and amortization of intangible assets during such
period on the books of such Person and its Subsidiaries.
"Environmental Laws" shall mean all federal, state and local environmental,
health and safety statutes and regulations, including without limitation all
statutes and regulations establishing quality criteria and standards for air,
water, land and toxic or hazardous wastes and substances.
17
<PAGE>
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"Eurodollar Bid Loan" shall have the meaning specified in Section 2.1
hereof.
"Eurodollar Loan" shall mean a Revolving Credit Loan which bears interest
as provided in Section 1.3(b) hereof.
"Eurodollar Rate" shall mean for each Interest Period applicable to a
Eurodollar Loan or Eurodollar Bid Loan, (a) the LIBOR Index Rate for such
Interest Period, if such rate is available, and (b) if the LIBOR Index Rate
cannot be determined, the arithmetic average of the rates of interest per annum
(rounded upwards, if necessary, to nearest one hundred-thousandth of a
percentage point) at which deposits in U.S. dollars in immediately available
funds are offered to the Administrative Agent at 11:00 a.m. (London, England
time) two (2) Business Days before the beginning of such Interest Period by
three (3) or more major banks in the interbank eurodollar market selected by the
Administrative Agent for a period equal to such Interest Period and in an amount
equal or comparable to the principal amount of the Eurodollar Loan or Eurodollar
Bid Loan scheduled to be made by the Administrative Agent or, in the case of a
Eurodollar Bid Loan, the applicable Bank (if other than the Administrative
Agent) during such Interest Period.
"Event of Default" shall mean any event or condition identified as such in
Section 8.1 hereof.
"Existing Agreements" shall mean the separate Note Purchase Agreements,
each dated June 1, 1992, between the Company and the purchasers named therein
relating to the Company's 9.42% Senior Notes due June 15, 2002.
"Existing Lenders" shall mean the purchasers under the Existing Agreements.
"Fed Funds Rate" shall have the meaning specified in Section 1.5(c) hereof.
"First Mississippi Guaranty" shall mean the Guaranty Agreement of even date
herewith from the Borrowers, as guarantors thereunder, to the lenders under the
Chemical Credit Agreement pursuant to which the Borrowers guaranty the payment
when due of the Guarantors' indebtedness, obligations and liabilities under the
Chemical Credit Agreement and related documents.
"First Mississippi Purchase Agreement" shall mean the Agreement and Plan of
Merger and Reorganization dated as of August 27, 1996 by and among Chemical,
MISS SUB INC. and the Company.
"Fixed Rate Loan" shall mean any Eurodollar Loan or Bid Loan.
18
<PAGE>
"Guaranty Agreement" shall mean that certain Guaranty Agreement dated as of
even date herewith executed by the Guarantors in favor of the Banks.
"Guarantors" shall mean Chemical, Mississippi Phosphates Corporation, a
Delaware corporation, and Mississippi Potash, Inc., a Mississippi corporation,
in their capacity as guarantors under the Guaranty Agreement.
"Harris" shall have the meaning specified in the first paragraph of this
Agreement.
"Interest Expense" shall mean, for any Person and with reference to any
period, the sum of all interest charges (including imputed interest charges with
respect to Capitalized Lease Obligations, all amortization of debt discount and
expense and all fees relating to letters of credit accrued and all net
obligations pursuant to interest rate hedging agreements) of such Person and its
Subsidiaries for such period determined on a consolidated basis in accordance
with generally accepted accounting principles, consistently applied.
"Interest Period" shall mean with respect to (a) any Eurodollar Loan, the
period used for the computation of interest commencing on the date the relevant
Eurodollar Loan is made, continued or effected by conversion and concluding on
the date one, two, three, six or twelve months thereafter as selected by the
Company in its notice as provided herein, (b) any Eurodollar Bid Loan, the
period used for the computation of interest commencing on the date the relevant
Eurodollar Bid Loan is made, continued or effected by conversion and concluding
on the date one, two, three, four, five or six months thereafter as selected by
the Company in its notice as provided herein, and (c) any Stated Rate Bid Loan,
the period commencing on, as the case may be, the creation, continuation or
conversion date with respect to such Stated Rate Bid Loan and ending one (1) to
one hundred eighty (180) days thereafter as selected by the Company in its
notice as provided herein; provided that all of the foregoing provisions
relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day which is
not a Business Day, that Interest Period shall be extended to the next
succeeding Business Day, unless in the case of an Interest Period for a
Eurodollar Loan or Eurodollar Bid Loan 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 Business Day;
(ii) no Interest Period may extend beyond the Termination Date; and
(iii) the interest rate to be applicable to each Loan for each
Interest Period shall apply from and including the first day of such
Interest Period to but excluding the last day thereof.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no
19
<PAGE>
numerically corresponding day in the month in which an Interest Period is to
end, then such Interest Period shall end on the last Business Day of such month.
"Inventory" shall mean all raw materials, work in process, finished goods,
and goods held for sale or lease or furnished or to be furnished under contracts
of service in which any Borrower or any Subsidiary now has or hereafter acquires
any right.
"LIBOR Index Rate" shall mean, for any Interest Period applicable to a
Eurodollar Loan, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of a percentage point) for deposits in U.S.
Dollars for a period equal to such Interest Period, which appears on the
Telerate Page 3750 as of 11:00 a.m. (London, England time) on the day two
Business Days before the commencement of such Interest Period.
"Loan" shall mean Revolving Credit Loans and Bid Loans, and each of them
singly, and the term "type" of Loan refers to its status as a Eurodollar Loan,
Eurodollar Bid Loan, a Base Rate Loan or Stated Rate Bid Loan.
"Loan Documents" shall mean this Agreement and any and all exhibits hereto,
the Notes and the Guaranty Agreement.
"Net Income" means, for any Person and with reference to any period, the
net income of such Person and its Subsidiaries for such period determined on a
consolidated basis in accordance with generally accepted accounting principles,
consistently applied, but excluding in any event any items of extraordinary gain
or loss.
"Note" or "Notes" shall have the meaning specified in Section 3.1 hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean and include any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust, unincorporated
organization, association, corporation, institution, entity, party or government
(whether national, federal, state, county, city, municipal, or otherwise,
including, without limitation, any instrumentality, division, agency, body or
department thereof).
"Plan" shall mean any employee benefit plan covering any officers or
employees of a Borrower or any Subsidiary, any benefits of which are, or are
required to be, guaranteed by the PBGC.
"Potential Default" shall mean any event or condition specified in Section
8.1 hereof which, with the lapse of time, or giving of notice, or both, would
constitute an Event of Default.
"Pricing Ratio" shall mean, as of any date or determination, the ratio of
(x) the sum of all Debt of Chemical and its Subsidiaries (determined on a
consolidated basis) to (y) EBITDA of the
20
<PAGE>
Relevant Parties, each calculated on a consolidated basis in accordance with
generally accepted accounting principles, for the four fiscal quarters ending on
such date of determination.
"Property" shall mean all assets and properties of any nature whatsoever,
whether real or personal, tangible or intangible, including without limitation
intellectual property.
"Relevant Parties" shall mean (a) with reference to any period prior to the
completion of the Acquisition, the Borrowers and the Guarantors, and (b) with
reference to any period after the completion of the Acquisition, Chemical and
its Subsidiaries.
"Required Banks" shall mean any Bank or Banks which in the aggregate have more
than 50% of the Revolving Credit Commitments or, if at the time no Revolving
Credit Commitments are in effect, any Bank or Banks which in the aggregate hold
more than 50% of the aggregate unpaid principal balance of the Loans then
outstanding.
"Reserve Percentage" means the daily arithmetic average maximum rate at which
reserves (including, without limitation, any supplemental, marginal and
emergency reserves) are imposed on member banks of the Federal Reserve System
during the applicable Interest Period by the Board of Governors of the Federal
Reserve System (or any successor) under Regulation D on "eurocurrency
liabilities" (as such term is defined in Regulation D), subject to any
amendments of such reserve requirement by such Board or its successor, taking
into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be eurocurrency liabilities
as defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D. As of the date hereof, the Reserve
Percentage is zero.
"Revolving Credit" shall have the meaning specified in the first paragraph of
this Agreement.
"Revolving Credit Commitment" and "Revolving Credit Commitments" shall have
the meanings specified in Section 1.1(b) hereof.
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the meanings
specified in Section 1.1(a) hereof.
"Revolving Note" or "Revolving Notes" shall have the meanings specified in
Section 3.1 hereof.
"Spin-Off" shall mean the spin-off of the Company's chemicals and other
nonfertilizer business to the Company's existing shareholders by means of a pro
rata dividend distribution of common stock of ChemFirst pursuant to the terms
and conditions of the Distribution Agreement.
"Subsidiary" shall mean, for any Person, any corporation or other entity of
which more than fifty percent (50%) of the outstanding stock or comparable
equity interests having ordinary voting power for the election of the Board of
Directors of such corporation or similar governing
21
<PAGE>
body in the case of a non-corporation (irrespective of whether or not, at the
time, stock or other equity interests of any other class or classes of such
corporation or other entity shall have or might have voting power by reason of
the happening of any contingency) is at the time directly or indirectly owned by
such Person or by one or more of its Subsidiaries, provided, further, that upon
consummation of the Spin-Off, the term "Subsidiary" shall not be deemed to
include, effective upon execution of this Agreement, any non-fertilizer
subsidiary or non-fertilizer affiliate of the Company which were distributed as
part of said Spin-Off.
"Syndication Agent" shall have the meaning specified in the first paragraph of
this Agreement.
"Tangible Net Worth" means, for any Person and at any time the same is to be
determined, the total shareholders' equity (including capital stock, additional
paid-in capital and retained earnings after deducting treasury stock and
excluding minority interests in Subsidiaries) which would appear on the balance
sheet of such Person and its Subsidiaries determined on a consolidated basis in
accordance with generally accepted accounting principles, consistently applied,
less the sum of the aggregate book value of all assets which would be classified
as intangible assets under generally accepted accounting principles,
consistently applied, including, without limitation, goodwill, patents,
trademarks, trade names, copyrights, franchises and deferred charges (including,
without limitation, unamortized debt discount and expense, organization costs
and deferred research and development expense, but excluding deferred taxes) and
similar assets and the write-up of assets above cost.
"Telerate Page 3750" shall mean the display designated as "Page 3750" on the
Telerate Service (or such other page as may replace Page 3750 on that service or
such other service as may be nominated by the British Bankers' Association as
the information vendor for the purpose of displaying British Bankers'
Association Interest Settlement Rates for U.S. Dollar deposits).
"Termination Date" shall have the meaning set forth in Section 1.1(a) hereof.
"Total Assets" shall mean, at any time the same is to be determined, the
aggregate of all items which would be listed as an asset on a balance sheet of a
Person and its Subsidiaries determined on a consolidated basis in accordance
with generally accepted accounting principles.
"Total Outstandings" shall mean the aggregate principal amount of all Loans
outstanding under this Agreement.
"Triad" shall mean Triad Chemical, a Mississippi general partnership.
"Triad Chemical Product Withdrawal Agreement" shall mean that certain Products
Withdrawal Agreement dated June 3, 1968 by and among First Mississippi, MisCoa,
a partnership of general partners, Chemical and Coastal Chemical Corporation, a
Mississippi corporation.
22
<PAGE>
Section 4.2. Accounting Terms. Any accounting term not otherwise
specifically defined in this Agreement shall have the meaning customarily given
to such term in accordance with generally accepted accounting principles,
consistently applied. Where the character or amount of any asset or liability
or item of income or expense is required to be determined or any consolidation
or other accounting computation is required to be made for the purpose of this
Agreement, it shall be done in accordance with generally accepted accounting
principles, to the extent applicable, except where such principles are
inconsistent with the requirements of this Agreement.
Section 5. Representations and Warranties.
Each Borrower represents and warrants to the Banks as follows:
Section 5.1. Organization and Qualification; Non-Contravention. Each
Borrower is duly organized, validly existing and in good standing under the laws
of the state of its incorporation, has full and adequate corporate power to
carry on its business as now conducted, is duly licensed or qualified in all
jurisdictions wherein the nature of its activities requires such licensing or
qualifying, except where the failure to be so licensed or qualified would not
result in a material adverse change in the Properties, business or operations of
the Company and its Subsidiaries taken as a whole, has full right, power and
authority to be a party to the Acquisition, to effect the Spin-off, to enter
into the Acquisition Documents to which it is a party, this Agreement and the
other Loan Documents to which it is a party, to make the borrowings herein
provided for, to execute and issue its Notes in evidence thereof, and to perform
each and all of the matters and things herein and therein provided for; and the
Acquisition Documents to which it is a party, this Agreement and the other Loan
Documents do not, nor does the performance or observance by any Borrower of any
of the matters or things provided for in the Acquisition Documents and the Loan
Documents, contravene any provision of law or any charter or by-law provision or
any material covenant, indenture or agreement of or affecting such Borrower or
its Properties.
Section 5.2. Financial Reports. (a) The Company has heretofore delivered to
each Bank a copy of the annual audit report as of June 30, 1996, and the
accompanying financial statements of the Company and its Subsidiaries and
unaudited financial statements of the Company and its Subsidiaries as of, and
for the interim period ending September 30, 1996. Such financial statements
have been prepared in accordance with generally accepted accounting principles
(except for the omission of footnotes and subject to normal year-end audit
adjustments with respect to such unaudited statements) on a basis consistent,
except as otherwise noted therein, with that of the previous fiscal year or
period and fairly reflect in all material respects the financial position of the
Company and its Subsidiaries as of the dates thereof, and the results of its
operations for the periods covered thereby. The Borrowers and their
Subsidiaries have no material contingent liabilities other than as indicated on
said financial statements and since said date of June 30, 1996, there has been
no material adverse change in the condition, financial or otherwise, of any
Borrower or any Subsidiary, except those disclosed in writing to the Banks prior
to the date of this Agreement.
23
<PAGE>
(b) The Company has heretofore delivered to each Bank a copy of the Audited
Special Purpose Combined Financial Statements as of June 30, 1996, of the
fertilizer operations of the Company and its Subsidiaries and unaudited
financial statements of the fertilizer operations of the Company and its
Subsidiaries as of, and for the interim period ending September 30, 1996. Such
financial statements have been prepared in accordance with generally accepted
accounting principles (except for the omission of footnotes and subject to
normal year-end audit adjustments with respect to such unaudited statements) on
a basis consistent, except as otherwise noted therein, with that of the previous
fiscal year or period and fairly reflect in all material respects the financial
position of the fertilizer operations of the Company and its Subsidiaries as of
the dates thereof, and the results of its operations for the periods covered
thereby. The fertilizer operations of the Borrowers and their Subsidiaries have
no material contingent liabilities other than as indicated on said financial
statements and since said date of June 30, 1996, there has been no material
adverse change in the condition, financial or otherwise, of the fertilizer
operations of any Borrower or any Subsidiary, except those occurring in the
ordinary course of business or disclosed in writing to the Banks prior to the
date of this Agreement.
Section 5.3. Litigation; Tax Returns; Approvals. Except as disclosed on
Schedule 5.3 hereto, there is no litigation, labor controversy or governmental
proceeding pending, nor to the knowledge of any Borrower threatened, against
such Borrower or any Subsidiary which if adversely determined would result in
any material adverse change in the Properties, business or operations of
Chemical and its Subsidiaries taken as a whole. All federal, state and local
income tax returns for each Borrower and its Subsidiaries required to be filed
have been filed on a timely basis, and all amounts required to be paid as shown
by said returns have been paid. Except as disclosed on Schedule 5.3 hereto,
there are no pending or, to any Borrower's knowledge, threatened objections to
or controversies in respect of the United States federal, state or local income
tax returns of any Borrower and its Subsidiaries for any fiscal year. No
authorization, consent, license, exemption or filing or registration with any
court or governmental department, agency or instrumentality, is or will be
necessary to the valid execution, delivery or performance by any Borrower of the
Loan Documents or the Acquisition Documents to which it is a party, except such
as have been previously obtained or where the failure to obtain such
authorization, consent, license, exemption or make such filing or registration
would not result in a material adverse change in the Properties, business or
operations of the Company and its Subsidiaries taken as a whole.
Section 5.4. Regulation U. Neither any Borrower nor any Subsidiary is
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System) and no part of the proceeds of any Loan
or other extension of credit hereunder will be used to purchase or carry any
margin stock or to extend credit to others for such a purpose.
Section 5.5. No Default. The Borrowers are in full compliance with all of
the terms and conditions of this Agreement, and no Potential Default or Event of
Default is existing under this Agreement.
24
<PAGE>
Section 5.6. ERISA. The Borrowers and their Subsidiaries are in compliance
in all material respects with ERISA to the extent applicable to it and neither
any Borrower nor any Subsidiary has received any notice to the contrary from the
PBGC or any other governmental entity or agency. No steps have been taken to
terminate any Plan, and no contribution failure has occurred with respect to any
Plan sufficient to give rise to a lien under Section 302(f) of ERISA. No
condition exists or event or transaction has occurred with respect to any Plan
which might result in the incurrence by any Borrower or any Subsidiary of any
material liability, fine or penalty. Neither any Borrower nor any Subsidiary
has any contingent liability with respect to any post-retirement benefit under a
Plan, other than liability for continuation coverage described in Part 6 of
Title I of ERISA.
Section 5.7. Debt and Security Interests. The Borrowers and their
Subsidiaries have no Debt except Debt permitted by Section 7.9 hereof, and there
are no security interests, liens or encumbrances on any of the assets or
Property of any Borrower or any Subsidiary except for those permitted by Section
7.8 hereof.
Section 5.8. Subsidiaries and Guarantors. The Borrowers' only Subsidiaries
are identified on Exhibit F hereof. Each of said Subsidiaries is duly organized
and validly existing under the laws of the state or country of its
incorporation, has full and adequate corporate power to carry on its business as
now conducted, and is duly licensed or qualified to do business in all
jurisdictions wherein the nature of its activities requires such licensing or
qualification, except where the failure to be so licensed or qualified would not
result in a material adverse change in the Properties, business or operations of
the Company and its Subsidiaries taken as a whole. Each Guarantor has full
right, power and authority to execute and deliver the Loan Documents and
Acquisition Documents executed by it and to perform each and all of the matters
and things therein provided for; and the Loan Documents and Acquisition
Documents executed by it do not, nor does the performance or observance by any
Guarantor of any of the matters or things therein provided for, contravene any
provision of law or any provision of any charter, partnership agreement,
articles of incorporation or bylaws of any Guarantor or any material covenant,
indenture or agreement of or affecting any Guarantor or any of such Guarantor's
Property.
Section 5.9. Accurate Information. No information, exhibit or report
furnished by any Borrower or any Subsidiary to the Banks in connection with the
negotiation or performance of the Loan Documents contains any material
misstatement of fact or omitted to state a material fact or any fact necessary
to make the statements contained therein not misleading in light of the
circumstances in which made.
Section 5.10. Enforceability. This Agreement is and the other Loan Documents
and Acquisition Documents to which each Borrower is a party are the legal, valid
and binding agreements of such Borrower, enforceable against it in accordance
with its terms, except as may be limited by (a) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws or
judicial decisions for the relief of debtors or the limitation of creditors'
rights generally; and (b) any equitable principles relating to or limiting the
rights of creditors generally or any equitable remedy which may be granted to
cure any defaults.
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Section 5.11. Restrictive Agreements. No Borrower is a party to any contract
or agreement, or subject to any charge or other corporate restriction, which
affects its ability to execute, deliver and perform the Loan Documents to which
it is a party and repay its indebtedness, obligations and liabilities under the
Loan Documents or which materially and adversely affects the financial condition
or results of operations of the Company and its Subsidiaries taken as a whole,
or would materially and adversely affect such Borrower's legal ability to repay
the indebtedness, obligations and liabilities under the Loan Documents, or any
Bank's or the Agent's rights under the Loan Documents to which any Borrower is a
party.
Section 5.12. No Violation of Law. Neither any Borrower nor any Subsidiary
is in violation of any law, statute, regulation, ordinance, judgment, order or
decree applicable to it which violation would materially and adversely affect
any Bank's or any Agent's rights under the Loan Documents or the financial
condition or results of operations of the Company and its Subsidiaries taken as
a whole.
Section 5.13. No Default Under Other Agreements. Neither any Borrower nor
any Subsidiary is in default with respect to any note, indenture, loan
agreement, mortgage, lease, deed, or other agreement to which it is a party or
by which it or its Property is bound, which default would materially and
adversely affect any Bank's or any Agent's rights under the Loan Documents or
the financial condition or results of operations of the Company and its
Subsidiaries taken as a whole.
Section 5.14. Status Under Certain Laws. Neither any Borrower nor any of its
Subsidiaries is an "investment company" or a person directly or indirectly
controlled by or acting on behalf of an "investment company" within the meaning
of the Investment Company Act of 1940, as amended, or a "holding Company," or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company," within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
Section 6. Conditions Precedent.
The obligation of the Banks to make any Loan pursuant hereto shall be subject
to the following conditions precedent:
Section 6.1. Initial Extension of Credit. Prior to the initial Loan
hereunder, the following conditions precedent shall have been satisfied:
(a) the Borrowers shall have delivered to the Administrative Agent for the
benefit of the Banks in sufficient counterparts for distribution to the Banks:
(i) the Notes (one for each Bank);
(ii) the Guaranty Agreement executed by the Guarantors;
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(iii) good standing certificates for each Borrower and each Guarantor
issued by the states of Delaware, Louisiana, New Mexico and Mississippi, as
applicable, issued not more than 30 days before the date of this Agreement;
(iv) copies of the Articles of Incorporation, and all amendments
thereto, of each Borrower and each Guarantor, certified by the Secretary of
State of its state of incorporation not more than 30 days before the date
of this Agreement;
(v) copies of the By-Laws, and all amendments thereto, of each Borrower
and each Guarantor, certified as true, correct and complete on the date
hereof by the Secretary or Assistant Secretary of each Borrower and each
Guarantor;
(vi) copies, certified as true, correct and complete by the Secretary
or Assistant Secretary of each Borrower and each Guarantor, of resolutions
regarding the transactions contemplated by this Agreement, duly adopted by
the Board of Directors of each Borrower and Guarantor and satisfactory in
form and substance to the Agents;
(vii) a pay-off letter from the Existing Banks under the Existing
Agreements in form and substance satisfactory to the Agents and such other
evidence that all of the Borrowers' indebtedness thereunder has been fully
paid as the Agents may require;
(viii) an incumbency and signature certificate for each Borrower and each
Guarantor satisfactory in form and substance to the Agents;
(ix) copies, certified as true, complete and correct by the Secretary,
Assistant Secretary or other authorized officer of the Company, of the
Acquisition Documents, together with a certificate or certificates from the
Secretary, Assistant Secretary or other authorized officer of the Company
to the effect that the representations and warranties of Chemical contained
in the First Mississippi Purchase Agreement are true and correct in all
material respects as of the date thereof (except as to any representation
or warranty that specifically relates to an earlier date, each of which is
true and correct in all material respects as of such earlier date, and
except as otherwise contemplated by the First Mississippi Purchase
Agreement), that Chemical has performed in all material respects all
obligations required to be performed by it under the First Mississippi
Purchase Agreement and the Distribution Agreement, and that the First
Mississippi Purchase Agreement has not been amended or otherwise modified,
nor has any term or provision thereof been waived, in a manner that would
materially and adversely affect the Company's ability to repay its
indebtedness, obligations and liabilities to the Banks under the Loan
Documents or the financial condition of the Company and its Subsidiaries
taken as a whole; and
(x) copies (executed or certified, as may be appropriate) of all legal
documents or proceedings taken in connection with the Acquisition and the
execution and delivery of this Agreement and the other Loan Documents to
the extent the Administrative Agent may reasonably request.
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(b) the Agents shall have received (i) all fees payable to them in connection
with the execution and delivery of this Agreement and the transactions
contemplated hereby, and (ii) the fees required by Section 3.7 hereof;
(c) all conditions precedent to the Acquisition, except the Spin-Off and the
financings under this Agreement and the Chemical Credit Agreement, shall have
been satisfied and the Agents shall have received evidence satisfactory to it of
the foregoing;
(d) the Administrative Agent shall have received evidence satisfactory to the
Agents that the closing of the Acquisition shall occur prior to the second
Business Day immediately following the date hereof;
(e) substantially concurrently with the closing hereof, Chemical and its
Subsidiaries shall have executed the Chemical Credit Agreement and all
conditions precedent to the making of the initial loans thereunder, except the
satisfaction of the conditions precedent to the making of the initial Loans
under this Agreement shall have been fully satisfied;
(f) the Administrative Agent shall have received evidence satisfactory to the
Agents that prior to the second Business Day immediately following the date
hereof, the closing of the Spin-Off shall occur; and
(g) the Administrative Agent shall have received evidence of insurance
required by Section 7.3 hereof; and
(h) the Administrative Agent shall have received current Phase I environmental
inspection reports for the real property listed on Schedule 6.1(i) hereto owned
by the Borrowers and the Guarantors satisfactory to the Administrative Agent.
Section 6.2. Each Extension of Credit. As of the time of the making of each
Loan hereunder (including the initial Loan):
(a) each of the representations and warranties set forth in Section 5 hereof
shall be and remain true and correct as of said time, except that (i) the
representations and warranties made under Section 5.2(a) shall be deemed to
refer to the most recent financial statements furnished to the Banks pursuant to
Section 7.4 hereof, and (ii) after the Acquisition, every reference to a
material adverse change in the Properties, business or operations of the Company
and its Subsidiaries taken as a whole contained in Sections 5.1, 5.2(a), 5.3,
5.8, 5.11, 5.12 and 5.13 shall be deemed to refer to a material adverse change
in the Properties, business or operations of Chemical and its Subsidiaries taken
as a whole;
(b) the Borrowers shall be in full compliance with all of the terms and
conditions hereof, and no Potential Default or Event of Default shall have
occurred and be continuing;
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(c) with respect to each Loan requested by the Company, for itself or any
other Borrower, the aggregate amount of the Total Outstandings shall not exceed
the Revolving Credit Commitments; and
(d) immediately after giving effect thereto, not more than 25% of the value of
the Borrowers' and their Subsidiaries' assets that are subject to Sections 7.8
and 7.11 hereof shall constitute margin stock (as defined in Regulation U
promulgated by the Board of Governors of the Federal Reserve System);
and the request by the Company for any Loan pursuant hereto shall be and
constitute a warranty to the foregoing effects.
Section 6.3. Legal Matters. Legal matters incident to the execution and
delivery of the Loan Documents shall be satisfactory to each of the Banks and
their legal counsel; and prior to the initial Loan hereunder, the Administrative
Agent shall have received the favorable written opinions of Skadden Arps Slate
Meagher & Flom (Illinois), counsel for the Borrowers, substantially in the form
of Exhibit H-1, Donaldson, Bearman & Caldwell, special counsel to the
Guarantors, in the form of Exhibit H-2, J. Steve Chustz, Esquire, general
counsel to First Mississippi in the form of Exhibit H-3, and Phelps Dunbar,
L.L.P., special counsel to AMPRO Fertilizer, Inc., in the form of Exhibit H-4,
and the favorable written opinion of Hughes & Luce, L.L.P., counsel for the
Guarantors, substantially in the form of Exhibit I, in substance satisfactory to
each of the Banks and their respective legal counsel.
Section 6.4. Documents. The Administrative Agent shall have received copies
(executed or certified, as may be appropriate) of all documents or proceedings
taken in connection with the execution and delivery of the Loan Documents to the
extent the Required Banks or their respective legal counsel reasonably request.
Section 7. Covenants.
It is understood and agreed that so long as credit is in use or available
under this Agreement or any amount remains unpaid on any Note, except to the
extent compliance in any case or cases is waived in writing by the Required
Banks:
Section 7.1. Maintenance of Property. Each Borrower will, and will cause
each Subsidiary to, keep and maintain all of its Properties necessary or useful
in its business in good condition, and make all necessary renewals,
replacements, additions, betterments and improvements thereto; provided,
however, that nothing in this Section shall prevent the Borrowers or any
Subsidiary from discontinuing the operating and maintenance of any of its
properties if such discontinuance is, in the judgment of such Borrower,
desirable in the conduct of its business and not disadvantageous in any material
respect to the Banks as holders of the Notes.
Section 7.2. Taxes. Each Borrower will, and will cause each Subsidiary to,
duly pay and discharge all taxes, rates, assessments, fees and governmental
charges upon or against such
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Borrower or any Subsidiary or against its Properties in each case before the
same becomes delinquent and before penalties accrue thereon unless and to the
extent that the same is being contested in good faith and by appropriate
proceedings and for which reserves have been established in accordance with
generally accepted accounting principles, consistently applied.
Section 7.3. Maintenance of Insurance. Each Borrower will, and will cause
each Subsidiary to, maintain insurance with insurers recognized as financially
sound and reputable by prudent business persons in such forms and amounts and
against such risks as is usually carried by companies engaged in similar
business and owning similar Properties in the same general areas in which such
Borrower or such Subsidiary operates. Each Borrower shall provide the
Administrative Agent with evidence of insurance maintained by it upon the
Administrative Agent's request.
Section 7.4. Financial Reports. The Company will, and will cause each
Subsidiary to, maintain a system of accounting in accordance with sound
accounting practice and will furnish promptly to each of the Banks and their
duly authorized representatives such information respecting the business and
financial condition of the Company and its Subsidiaries as may be reasonably
requested and, without any request, will furnish each Bank, as soon as
available, and in any event within 45 days after the close of the first three
fiscal quarters of the Company and 90 days after the close of each fiscal year
of the Company, a Compliance Certificate in the form of Exhibit G attached
hereto, prepared and signed by the President or Chief Financial Officer of the
Company.
Section 7.5. Inspection. Each Borrower shall, and shall cause each
Subsidiary to, permit each of the Banks, by their representatives and
Administrative Agents, to inspect any of the Properties, corporate books and
financial records of such Borrower, and each Subsidiary, to examine and make
copies of the books of accounts and other financial records of each Borrower and
their Subsidiaries and to discuss the affairs, finances and accounts of each
Borrower and their Subsidiaries with, and to be advised as to the same by, its
officers at such reasonable times and reasonable intervals as the Required Banks
may reasonably request. The Borrowers shall pay the reasonable costs and
expenses of the Administrative Agent in connection with any inspection of the
Borrowers' and their Subsidiaries' books and records.
Section 7.6. Consolidation and Merger. Each Borrower will not, and will not
permit any Subsidiary to, consolidate with or merge into any Person, or permit
any other Person to merge into it, or acquire (in a transaction analogous in
purpose or effect to a consolidation or merger) all or substantially all of the
Property of any other Person, except that:
(a) any Person may merge into any Borrower or any Subsidiary so long as:
(i) the Borrower or Subsidiary shall be the surviving entity; provided,
however, that such Borrower or Subsidiary is not required to be the surviving
entity if such Borrower's or Subsidiary's board of directors becomes a
majority of the board of directors of the surviving entity immediately upon
completion of such transaction and
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such surviving Person shall agree to assume each and every obligation of such
Borrower or Subsidiary pursuant to this Agreement and any other Loan Document;
(ii) the Person merging with or into a Borrower or a Subsidiary shall be
in the same line or a related line of business as such Borrower or Subsidiary;
(iii) the board of directors (or equivalent governing body) of such Person
shall have given its prior effective written consent or approval of such
merger; and
(iv) no Potential Default or Event of Default shall exist before or after
giving effect to such merger; and
(b) the Company or any Subsidiary of the Company may be merged or consolidated
with or into: (i) Chemical, if Chemical should be the continuing or surviving
corporation, or (ii) any other Subsidiary of Chemical, provided that if such
other Subsidiary is a Borrower or Guarantor such other Subsidiary shall be the
continuing or surviving corporation.
Section 7.7. Transactions with Affiliates. Each Borrower will not, and will
not permit any Subsidiary to, enter into any transaction, including without
limitation, the purchase, sale, lease or exchange of any Property, or the
rendering of any service, with any Affiliate of such Borrower except in the
ordinary course of and pursuant to the reasonable requirements of such
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to such Borrower or such Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate of such
Borrower; provided however that the foregoing shall not prevent any transactions
between any Borrower and any other Borrower on any terms mutually acceptable to
them.
Section 7.8. Liens. Each Borrower will not, and will not permit any
Subsidiary to, pledge, mortgage or otherwise encumber or subject to or permit to
exist upon or be subjected to any lien, charge or security interest of any kind
(including any conditional sale or other title retention agreement and any lease
in the nature thereof), on any of its Properties of any kind or character at any
time owned by such Borrower or any Subsidiary, other than:
(a) liens, pledges or deposits for worker's compensation, unemployment
insurance, old age benefits or social security obligations, taxes, assessments,
statutory obligations or other similar charges, good faith deposits made in
connection with tenders, contracts or leases to which a Borrower or a Subsidiary
is a party or other deposits required to be made in the ordinary course of
business, provided in each case the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate proceedings and
adequate reserves have been provided therefor in accordance with generally
accepted accounting principles and that the obligation is not for borrowed
money, customer advances, trade payables, or obligations to agricultural
producers;
(b) the pledge of assets for the purpose of securing an appeal or stay or
discharge in the course of any legal proceedings, provided that the aggregate
amount of liabilities of any
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Borrower or a Subsidiary so secured by a pledge of property permitted under this
subsection (b) including interest and penalties thereon, if any, shall not be in
excess of $10,000,000 at any one time outstanding;
(c) liens, pledges, mortgages, security interests or other charges existing on
the date hereof and disclosed in the audited financial statements referred to in
Section 5.2 hereof;
(d) liens for property taxes and assessments or governmental charges or levies
which are not yet due and payable;
(e) liens incidental to the conduct of business or the ownership of properties
and assets (including warehousemen's and attorneys' liens and statutory
landlords' liens) or other liens of like general nature incurred in the ordinary
course of business and not in connection with the borrowing of money, provided
in each case, the obligation secured is not overdue or, if overdue, is being
contested in good faith by appropriate actions or proceedings and adequate
reserves have been provided therefor in accordance with generally accepted
accounting principles, consistently applied;
(f) minor survey exceptions or minor encumbrances, easements or reservations,
or rights of others for rights-of-way, utilities and other similar purposes, or
zoning or other restrictions as to the use of real properties, which are
necessary for the conduct of the activities of the Borrowers and their
Subsidiaries or which customarily exist on properties of corporations engaged in
similar activities and similarly situated and which do not in any event
materially impair their use in the operation of the business of the Borrowers
and their Subsidiaries;
(g) the interests of lessors under Capitalized Leases;
(h) liens not otherwise permitted under this Section 7.8 on Property of
Chemical and its Subsidiaries securing Debt that is in an aggregate outstanding
principal amount not exceeding 5% of the value (determined in accordance with
generally accepted accounting principles consistently applied as shown on the
most recent financial statements delivered pursuant to the Chemical Credit
Agreement) of Chemical's Total Assets; and
(i) liens upon tangible personal property acquired after the date hereof (by
purchase, construction or otherwise), or upon other property acquired after the
date hereof as a capital expenditure, by the Company or any of its Subsidiaries,
each of which liens either (A) existed on such Property before the time of its
acquisition and was not created in anticipation thereof or (B) was created
solely for the purpose of securing indebtedness representing, or incurred to
finance, refinance or refund, the cost of such Property; provided that (A) no
such lien shall extend to or cover any Property of the Company or any of its
Subsidiaries other than the Property so acquired, (B) the principal amount of
indebtedness secured by any such lien shall not exceed the fair market value of
such Property at the time of acquisition, and (C) the aggregate principal amount
of all indebtedness secured by such liens shall not at any one time exceed
$10,000,000.
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Section 7.9. Borrowings and Guaranties. Each Borrower will not, and will not
permit any Subsidiary to, issue, incur, assume, create or have outstanding any
Debt, nor be or remain liable, whether as endorser, surety, guarantor or
otherwise, for or in respect of any Debt of any other Person, other than:
(a) indebtedness of the Borrowers arising under or pursuant to this Agreement
or the other Loan Documents and under the First Mississippi Guaranty;
(b) the liability of the Borrowers and their Subsidiaries arising out of the
endorsement for deposit or collection of commercial paper received in the
ordinary course of business;
(c) indebtedness of the Borrowers and their Subsidiaries existing on the date
hereof and disclosed to the Banks in the financial statements referred to in
Section 5.2 hereof; and
(d) indebtedness not otherwise permitted under this Section 7.9 of the Company
and all Subsidiaries of the Company in an aggregate principal amount of up to 5%
of the value (determined in accordance with generally accepted accounting
principles consistently applied as shown on the most recent financial statements
delivered pursuant to the Chemical Credit Agreement) of the Total Assets of
Chemical.
Section 7.10. Investments, Loans, Advances and Acquisitions. Each Borrower
will not, and will not permit any Subsidiary to, make or retain any investment
(whether through the purchase of stock, obligations or otherwise) in or make any
loan or advance to, any other Person, or acquire substantially as an entirety
the Property or business of any other Person, other than:
(a) investments in direct obligations of the United States of America or of
any agency or instrumentality thereof whose obligations constitute full faith
and credit obligations of the United States of America, provided that any such
obligations shall mature within one year of the date of issuance thereof;
(b) investments in commercial paper rated either P-1 by Moody's Investors
Services, Inc. or A-1 by Standard & Poor's Corporation maturing within 270 days
of the date of issuance thereof;
(c) investments in certificates of deposit issued by any United States
commercial bank or a branch located in the United States of a foreign commercial
bank in each case having capital and surplus of not less than $500,000,000 which
have a maturity of one year or less;
(d) investments in repurchase obligations with a term of not more than thirty
(30) days for underlying securities of the types described in subsection (a)
above entered into with any bank meeting the qualifications specified in
subsection (c) above, provided all such agreements require physical delivery of
the securities securing such repurchase agreement, except those delivered
through the Federal Reserve Book Entry System;
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(e) investments in money market funds that invest solely, and which are
restricted by their respective charters to invest solely, in investments of the
type described in the immediately preceding subsections (a), (b), (c) and (d)
above;
(f) marketable general obligations of a state, a territory or a possession of
the United States, or any political subdivision of any of the foregoing, or the
District of Columbia, unconditionally secured by the full faith and credit of
such state, territory, possession, political subdivision or district provided
that such state, territory, possession, political subdivision or district has
general taxing authority and the power to levy such taxes as may be required for
the payment of principal and interest thereof; provided that such obligations
are rated in either of the two top rating categories established by the national
rating agencies for such obligations;
(g) marketable corporate debt securities having an A credit rating or better
by Standard & Poor's Corporation or Moody's Investors Service;
(h) investments shown on the financial statements referred to in Section 5.2;
(i) loans and advances from any Borrower to any Subsidiary except Triad (so
long as Triad is in existence), provided that after completion of the Spin-Off
the aggregate outstanding amount of all such loans and advances to Subsidiaries
that are not Guarantors or Borrowers shall not exceed $35,000,000 at any time;
(j) other investments in and acquisitions (other than by merger or
consolidation) of the Property or business of any Person or a majority of the
capital stock or other equity interests of any other Person, provided that:
(i) such Person shall be in the same or a related line of business as
the Borrower or one or more Subsidiaries;
(ii) the board of directors (or equivalent governing body) of such
Person shall have given its prior effective written consent or approval of
such acquisition; and
(iii) no Potential Default or Event of Default shall exist before or
after giving effect to such acquisition.
(k) so long as Triad is in existence, investments, loans and advances made by
the Borrowers to Triad in an aggregate amount not to exceed (i) $12,500,000 at
any one time outstanding from and including the date hereof to and including
December 31, 1997 and (ii) $5,000,000 in any fiscal year thereafter; and
(l) investments, loans and advances not otherwise permitted under this Section
7.10 in an aggregate amount not exceeding 10% of the Tangible Net Worth of
Chemical at any one time outstanding.
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Section 7.11. Sale of Property. Each Borrower will not and will not permit
any Subsidiary to, sell, lease, assign, transfer or otherwise dispose of
(whether in one transaction or in a series of related transactions) all or a
material part of its Property to any other Person during each fiscal year of the
Company; provided, however, that each Borrower and their Subsidiaries may make:
(a) sales of its Inventory in the ordinary course of business,
(b) sales or leases of its machinery and equipment that is obsolete, unusable
or not needed for such Borrower's operations in the ordinary course of its
business,
(c) sale and leaseback transactions permitted by Section 7.16 hereof;
(d) sales of Property having a fair market value up to 5% of the Total Assets
of Chemical; provided, however, sales of Property having a fair market value
greater than 5% and up to 15% of the Total Assets of Chemical shall be
permitted, so long as the amount of the net proceeds of such sale in excess of
5% of the Total Assets of Chemical are reinvested in a line of business of
Chemical or any of its Subsidiaries; and
(e) the Spin-Off.
For purposes of this Section, "material part" shall mean Property having a
fair market value in excess of an amount equal to 5% of the Total Assets of
Chemical.
Section 7.12. Notice of Suit or Adverse Change in Business or Default. Each
Borrower shall, as soon as possible, and in any event within five (5) days after
such Borrower learns of the following, give written notice to the Banks of (a)
any material proceeding(s) being instituted or threatened to be instituted by or
against any Borrower or any Subsidiary in any federal, state, local or foreign
court or before any commission or other regulatory body (federal, state, local
or foreign), (b) any material adverse change in the business, Property or
condition, financial or otherwise of any Borrower and (c) the occurrence of any
Potential Default or Event of Default.
Section 7.13. ERISA. Each Borrower will, and will cause each Subsidiary to,
promptly pay and discharge all obligations and liabilities arising under ERISA
of a character which if unpaid or unperformed is likely to result in the
imposition of a lien against any of its Property and will promptly notify the
Administrative Agent of (a) the occurrence of any reportable event (as defined
in ERISA) which might result in the termination by the PBGC of any Plan, (b)
receipt of any notice from PBGC of its intention to seek termination of any such
Plan or appointment of a trustee therefor, and (c) its intention to terminate or
withdraw from any Plan. Each Borrower will not, and will not permit any
Subsidiary to, terminate any such Plan or withdraw therefrom unless it shall be
in compliance with all of the terms and conditions of this Agreement after
giving effect to any liability to PBGC resulting from such termination or
withdrawal.
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Section 7.14. Use of Proceeds. The Borrowers shall use the proceeds of the
initial Revolving Credit Loans to pay all indebtedness, obligations and
liabilities of the Borrowers under the Existing Agreements and all other Loans
made hereunder for general corporate purposes, including, without limitation,
making the distribution contemplated by the Acquisition Documents, financing
acquisitions, capital expenditures, refinancing existing debt and providing for
ongoing working capital needs.
Section 7.15. Compliance with Laws, etc. ;Each Borrower will, and will cause
each of its Subsidiaries to, comply in all material respects with all applicable
laws, rules, regulations and orders, including Environmental Laws, such
compliance to include (without limitation) the maintenance and preservation of
its corporate existence and qualification as a foreign corporation.
Section 7.16. Sale and Leaseback Transactions. Neither any Borrower nor any
of its Subsidiaries shall, directly or indirectly, enter into any arrangement
with any Person providing for any Borrower or a Subsidiary to lease or rent
Property that any Borrower or a Subsidiary has or will sell or otherwise
transfer to such Person, unless the aggregate net cash proceeds of any such
sales in any 12-month period are less than 5% of the Company's Tangible Net
Worth.
Section 7.17. Triad Chemical Product Withdrawal Agreement. So long as Triad
is in existence, the Company shall not consent to any amendment, modification or
waiver of the terms of the Triad Chemical Product Withdrawal Agreement.
Section 7.18. Fiscal Quarters. No Borrower shall change its fiscal quarters.
Section 7.19 New Subsidiaries. Neither any Borrower nor any Subsidiary
shall, directly or indirectly, organize or acquire any Subsidiary not listed on
Exhibit F attached hereto, except as permitted by Section 7.10(j) hereof.
Section 7.20. Dividends and Certain Other Restricted Payments. First
Mississippi will not and will not permit its Subsidiaries to (a) declare or pay
any dividends or make any distribution on any class of its capital stock (other
than dividends payable solely in its capital stock) or (b) directly or
indirectly purchase, redeem or otherwise acquire or retire any of its capital
stock (except out of the proceeds of, or in exchange for, a substantially
concurrent issue and sale of capital stock) or (c) make any other distributions
with respect to its capital stock (collectively, "Restricted Payments"); except
(a) the Spin-Off, and (b) after the completion of the Acquisition, any
Restricted Payments so long as no Potential Default or Event of Default shall
exist before and after giving effect thereto.
Section 8. Events of Default and Remedies.
Section 8.1. Definitions. Any one or more of the following shall constitute
an Event of Default:
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(a) Default in the payment when due of (i) any principal of any Note or (ii)
any interest on any Note which continues unremedied for 5 Business Days, whether
at the stated maturity thereof or at any other time provided in this Agreement,
or default in the payment when due of any fee or other amount payable by any
Borrower pursuant to this Agreement, which continues unremedied for 5 Business
Days;
(b) Default in the observance or performance of any covenant set forth in
Sections 7.3, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.14, 7.15, 7.17,
7.18, 7.19 or 7.20 hereof;
(c) Default in the observance or performance of any other covenant, condition,
agreement or provision hereof or any of the other Loan Documents and such
default shall continue for 30 days after written notice thereof to the Borrowers
by any Bank;
(d) Default shall occur under any evidence of Debt in a principal amount
exceeding $10,000,000 issued or assumed or guaranteed by any Borrower or any
Subsidiary, or under any mortgage, agreement or other similar instrument under
which the same may be issued or secured and such default shall continue for a
period of time sufficient to permit the acceleration of maturity of any
indebtedness evidenced thereby or outstanding or secured thereunder;
(e) Any representation or warranty made by any Borrower herein or in any Loan
Document or in any statement or certificate furnished by it pursuant hereto or
thereto, proves untrue in any material respect as of the date made or deemed
made pursuant to the terms hereof;
(f) Any judgment or judgments, writ or writs, or warrant or warrants of
attachment, or any similar process or processes in an aggregate amount in excess
of $10,000,000 shall be entered or filed against any Borrower or any Subsidiary
or against any of their respective Property or assets and remain unstayed and
undischarged for a period of 30 days from the date of its entry;
(g) (i) Any Guarantor shall purport to breach, disavow, revoke, repudiate or
terminate the Guaranty Agreement, or (ii) any event specified in Sections 8.1(k)
or (l) shall occur with regard to any Guarantor, or (iii) any "Event of Default"
(as defined in the Guaranty) shall occur with regard to any Guarantor; provided,
however, that an Event of Default under clause (iii) shall be cured if within 30
days of such occurrence the Company shall provide to the Administrative Agent
and the Banks a guaranty acceptable in form and substance to the Administrative
Agent and the Banks from a guarantor or guarantors acceptable to the
Administrative Agent and the Banks in their sole discretion;
(h) The closing of the Acquisition has not occurred prior to the second
Business Day immediately following the date hereof;
(i) The completion of the Spin-Off has not occurred prior to the second
Business Day immediately following the date hereof;
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(j) Any reportable event (as defined in ERISA) which constitutes grounds for
the termination of any Plan or for the appointment by the appropriate United
States District Court of a trustee to administer or liquidate any such Plan,
shall have occurred and be continuing thirty (30) days after written notice to
such effect shall have been given to the Company by any Bank; or any such Plan
shall be terminated; or a trustee shall be appointed by the appropriate United
States District Court to administer any such Plan; or the Pension Benefit
Guaranty Corporation shall institute proceedings to administer or terminate any
such Plan;
(k) Any Borrower or any Subsidiary shall (i) have entered involuntarily
against it an order for relief under the Bankruptcy Code of 1978, as amended,
(ii) admit in writing its inability to pay, or not pay, its debts generally as
they become due, (iii) make an assignment for the benefit of creditors, (iv)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, conservator, liquidator or similar official for it or any
substantial part of its property, (v) file a petition seeking relief or
institute any proceeding seeking to have entered against it an order for relief
under the Bankruptcy Code of 1978, as amended, to adjudicate it insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
marshaling of assets, adjustment or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors or
fail to file an answer or other pleading denying the material allegations of any
such proceeding filed against it, or (vi) fail to contest in good faith any
appointment or proceeding described in Section 8.1(l) hereof;
(l) A custodian, receiver, trustee, conservator, liquidator or similar
official shall be appointed for any Borrower or any Subsidiary of a Borrower or
any substantial part of its respective Property, or a proceeding described in
Section 8.1(k)(v) shall be instituted against any Borrower or any Subsidiary of
a Borrower and such appointment continues undischarged or any such proceeding
continues undismissed or unstayed for a period of 90 days; or
(m) a Change of Control shall occur.
Section 8.2. Remedies for Non-Bankruptcy Defaults. When any Event of
Default, other than an Event of Default described in subsections (k) and (l) of
Section 8.1 hereof, has occurred and is continuing, the Administrative Agent, if
directed by the Required Banks, shall give written notice to the Company and
take any or all of the following actions: (a) terminate the remaining Revolving
Credit Commitments hereunder on the date (which may be the date thereof) stated
in such notice, (b) declare the principal of and the accrued interest on the
Notes to be forthwith due and payable and thereupon the Notes including both
principal and interest, shall be and become immediately due and payable without
further demand, presentment, protest or notice of any kind, and (c) take any
action or exercise any remedy under any of the Loan Documents or exercise any
other action, right, power or remedy permitted by law. Any Bank may exercise
the right of set off with regard to any deposit accounts or other accounts or
investments maintained by any Borrower with any of the Banks.
Section 8.3. Remedies for Bankruptcy Defaults. When any Event of Default
described in subsections (k) or (l) of Section 8.1 hereof has occurred and is
continuing, then the Notes shall
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immediately become due and payable without presentment, demand, protest or
notice of any kind, and the obligation of the Banks to extend further credit
pursuant to any of the terms hereof shall immediately terminate.
Section 9. Change in Circumstances Regarding Fixed Rate Loans.
Section 9.1. Change of Law. Notwithstanding any other provisions of this
Agreement or any Note to the contrary, if at any time after the date hereof with
respect to Fixed Rate Loans, any Bank shall determine in good faith that any
change in applicable law or regulation or in the interpretation thereof makes it
unlawful for such Bank to make or continue to maintain any Fixed Rate Loan or to
give effect to its obligations as contemplated hereby, such Bank shall promptly
give notice thereof to the Borrowers describing in reasonable detail the basis
for such Bank's determination and to the Administrative Agent to such effect,
and such Bank's obligation to make, relend, continue or convert any such
affected Fixed Rate Loans under this Agreement shall terminate until it is no
longer unlawful for such Bank to make or maintain such affected Loan. The
Borrowers shall prepay the outstanding principal amount of any such affected
Fixed Rate Loan made to it, together with all interest accrued thereon and all
other amounts due and payable to the Banks under Section 9.4 of this Agreement,
on the earlier of the last day of the Interest Period applicable thereto and the
first day on which it is illegal for such Bank to have such Loans outstanding;
provided, however, the affected Borrower may borrow a principal amount equal to
the principal amount of such affected Loan by means of another type of Loan
available hereunder, subject to all of the terms and conditions of this
Agreement.
Section 9.2. Unavailability of Deposits or Inability to Ascertain the
Adjusted Eurodollar Rate. Notwithstanding any other provision of this Agreement
or any Note to the contrary, if prior to the commencement of any Interest Period
any Bank shall determine (i) that deposits in the amount of any Eurodollar Loan
scheduled to be outstanding are not available to it in the relevant market by
reason of circumstances affecting the interbank Eurodollar market generally or
(ii) by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Adjusted Eurodollar Rate,
then such Bank shall promptly give telephonic or telex notice thereof to the
Borrowers, the Administrative Agent and the other Banks (such notice to be
confirmed in writing), and the obligation of the Banks to make, continue or
convert any such Fixed Rate Loan in such amount and for such Interest Period
shall terminate until deposits in such amount and for the Interest Period
selected by the affected Borrower shall again be readily available in the
relevant market and adequate and reasonable means exist for ascertaining the
Adjusted Eurodollar Rate. Upon the giving of such notice, the affected Borrower
may elect to either (i) pay or prepay, as the case may be, such affected Loan or
(ii) reborrow such affected Loan as another type of Loan available hereunder,
subject to all terms and conditions of this Agreement.
Section 9.3. Taxes and Increased Costs. With respect to the Fixed Rate
Loans, if any Bank shall determine in good faith that any change in any
applicable law, treaty, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any new
law, treaty, regulation or guideline, or any interpretation of any of the
foregoing by any governmental authority charged with the administration thereof
or any
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central bank or other fiscal, monetary or other authority having jurisdiction
over such Bank or its lending branch or the Fixed Rate Loans contemplated by
this Agreement (whether or not having the force of law) ("Change in Law") shall:
(i) impose, modify or deem applicable any reserve, special deposit or
similar requirements against assets held by, or deposits in or for the
account of, or Loans by, or any other acquisition of funds or disbursements
by, such Bank (other than reserves included in the determination of the
Adjusted Eurodollar Rate);
(ii) subject such Bank, any Fixed Rate Loan or any Note to any tax
(including, without limitation, any United States interest equalization tax
or similar tax however named applicable to the acquisition or holding of
debt obligations and any interest or penalties with respect thereto), duty,
charge, stamp tax, fee, deduction or withholding in respect of this
Agreement, any Fixed Rate Loan or any Note except such taxes as may be
measured by the overall net income of such Bank or its lending branch and
imposed by the jurisdiction, or any political subdivision or taxing
authority thereof, in which such Bank's principal executive office or its
lending branch is located;
(iii) change the basis of taxation of payments of principal and interest
due from any Borrower to such Bank hereunder or under any Note (other than
by a change in taxation of the overall net income of such Bank); or
(iv) impose on such Bank any penalty with respect to the foregoing or
any other condition regarding this Agreement, any Fixed Rate Loan or any
Note;
and such Bank shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to such Bank
of making or maintaining any Fixed Rate Loan hereunder or to reduce the amount
of principal or interest received by such Bank, then, if such Bank is generally
imposing payments for increased costs on its similarly situated customers, the
Borrowers shall pay to such Bank from time to time as specified by such Bank
such additional amounts as such Bank shall reasonably determine are sufficient
to compensate and indemnify it for such increased cost or reduced amount. If
any Bank makes such a claim for compensation, it shall provide to the Borrowers
a certificate setting forth such increased cost or reduced amount as a result of
any event mentioned herein specifying such Change in Law, and such certificate
shall be conclusive and binding on the Borrowers as to the amount thereof except
in the case of manifest error. Upon the imposition of any such cost, the
Borrowers may prepay any affected Loan, subject to the provisions of Sections
3.4 and 9.4 hereof.
Section 9.4. Funding Indemnity. (a) In the event any Bank shall incur any
loss, cost, expense or premium (including, without limitation, any loss, cost,
expense or premium incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Bank to fund or maintain any Fixed Rate
Loan or the relending or reinvesting of such deposits or amounts paid or prepaid
to such Bank) as a result of:
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(i) any payment or prepayment of a Fixed Rate Loan on a date other
than the last day of the then applicable Interest Period;
(ii) any failure by any Borrower to borrow, continue or convert any
Fixed Rate Loan on the date specified in the notice given pursuant
to Sections 1.5 or 2.4 hereof; or
(iii) the occurrence of any Event of Default;
then, upon the demand of such Bank, the relevant Borrower shall pay to such Bank
such amount as will reimburse such Bank for such actual loss, cost or expense
(the calculation of such loss or expense shall include a credit (not in excess
of such loss or expense) for the interest to be earned by such Bank as a result
of redepositing such amount in the interbank market).
(b) If any Bank makes a claim for compensation under this Section 9.4, it
shall provide to the relevant Borrower a certificate setting forth the amount of
such loss, cost or expense in reasonable detail and such certificate shall be
conclusive and binding on the Borrowers as to the amount thereof except in the
case of manifest error.
Section 9.5. Lending Branch. Each Bank may, at its option, elect to make,
fund or maintain its Eurodollar Loans hereunder at the branch or office
specified opposite its signature on the signature page hereof or such other of
its branches or offices as such Bank may from time to time elect, subject to the
provisions of Section 1.5(b) hereof.
Section 9.6. Discretion of Bank as to Manner of Funding. Notwithstanding
any provision of this Agreement to the contrary, each Bank shall be entitled to
fund and maintain its funding of all or any part of its Loans in any manner it
sees fit, it being understood however, that for the purposes of this Agreement
all determinations hereunder shall be made as if the Banks had actually funded
and maintained each Fixed Rate Loan during each Interest Period for such Loan
through the purchase of deposits in the relevant interbank market having a
maturity corresponding to such Interest Period and bearing an interest rate
equal to the interest rate applicable thereto (exclusive of the Applicable
Margin) for such Interest Period.
Section 9.7. Mitigation of Circumstances; Replacement of Affected Banks.
(a) Banks' Duty to Mitigate. Each Bank agrees that, as promptly as
practicable after it becomes aware of the occurrence of an event or the
existence of a condition that would cause it to be affected under Section 1.6,
9.1, 9.2 or 9.3 hereof, such Bank will, after written notice to the Borrowers,
to the extent not inconsistent with such Bank's internal policies and customary
business practices, use its best efforts to make, fund or maintain the affected
Fixed Rate Loan, as the case may be, through another lending office of such Bank
if as a result thereof the unlawfulness which would otherwise require payment of
such Fixed Rate Loan pursuant to Section 9.1 or 9.2 hereof
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would cease to exist or the circumstances which would otherwise terminate such
Bank's obligation to make such Fixed Rate Loan under Section 9.1 or 9.2 hereof
would cease to exist or the increased costs which would otherwise be required to
be paid in respect of such Fixed Rate Loan pursuant to Section 1.6 or 9.3 hereof
would be materially reduced, and if, as determined by such Bank, in its sole
discretion, the making, funding or maintaining of such Fixed Rate Loan, as the
case may be, through such other lending office would not, in the judgment of
such Bank, be otherwise disadvantageous to such Bank. The Borrowers hereby agree
to pay all reasonable expenses incurred by each such Bank in utilizing another
lending office pursuant to this Section 9.7(a).
(b) Replacement of Affected Banks. At any time any Bank is affected by
any condition or circumstance set forth in Section 1.6, 9.1, 9.2 or 9.3, and so
long as no Event of Default, or Potential Default exists, (i) the Company may
replace such affected Bank as a party to this Agreement with one or more other
banks or financial institutions reasonably acceptable to the Administrative
Agent, (and upon notice from the Company such affected Bank shall assign,
pursuant to Section 11.17, without recourse or warranty, its Commitment, its
Loans, its Notes and all of its other rights and obligations hereunder to such
replacement banks or other financial institutions for a purchase price equal to
the sum of the principal amount of the Loans so assigned, all accrued and unpaid
interest thereon, its ratable share of all accrued and unpaid facility fees and
all other amounts owed to such Bank under the Loan Documents) and/or (ii) the
Company may (and, if the Company replaces any affected Bank in part as provided
in clause (i) above, concurrently with such replacement the Company shall) cause
such affected Bank to cease to be a party hereto by terminating the Commitment
of such Bank, paying, and causing any other relevant Borrowers to pay, the
principal amount of such affected Bank's Loans, all accrued and unpaid interest
thereon, all accrued and unpaid facility fees owed to such affected Bank and any
other amounts due to such affected Bank under the Loan Documents, in each case
to the extent not assigned and purchased pursuant to clause (i) above, and such
affected Bank shall thereupon cease to be a party hereto.
Section 10. The Agents.
Section 10.1. Appointment and Powers. (a) Harris is hereby appointed by
the Banks as Administrative Agent under the Loan Documents and each of the Banks
hereby irrevocably authorizes the Administrative Agent to act as the
Administrative Agent of such Bank. The Administrative Agent agrees to act as
such upon the express conditions contained in the Loan Documents.
(b) Bank of Montreal is hereby appointed by the Administrative Agent as
Syndication Agent under the Loan Documents and the Administrative Agent hereby
irrevocably authorizes the Syndication Agent to act as the Syndication Agent for
the Banks. The Syndication Agent agrees to act as such upon the express
conditions contained in the Loan Documents.
Section 10.2. Powers. The Agents shall have and may exercise such powers
hereunder as are specifically delegated to the Agents by the terms of the Loan
Documents, together with such powers as are incidental thereto. The Agents
shall have no implied duties to the Banks nor any obligation to the Banks to
take any action under the Loan Documents except any action specifically provided
by the Loan Documents to be taken by the Agents.
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Section 10.3. General Immunity. Neither any Agent nor any of such Agent's
directors, officers, agents or employees shall be liable to the Banks or any
Bank for any action taken or omitted to be taken by it or them under the Loan
Documents or in connection therewith except for its or their own gross
negligence or willful misconduct.
Section 10.4. No Responsibility for Loans, Recitals, etc. No Agent shall
(i) be responsible to the Banks for any recitals, reports, statements,
warranties or representations contained in the Loan Documents or furnished
pursuant thereto, (ii) be responsible for any Loans by any other Bank hereunder,
or (iii) be bound to ascertain or inquire as to the performance or observance of
any of the terms of the Loan Documents. In addition, no Agent nor such Agent's
counsel shall be responsible to the Banks for the enforceability or validity of
any of the Loan Documents.
Section 10.5. Right to Indemnity. The Banks hereby indemnify each Agent
for any actions taken in accordance with this Section 10, and each Agent shall
be fully justified in failing or refusing to take any action hereunder unless it
shall first be indemnified to its satisfaction by the Banks pro rata against any
and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action, other than any liability which may arise out
of such Agent's gross negligence or willful misconduct.
Section 10.6. Action Upon Instructions of Banks. Each Agent agrees, upon
the written request of the Required Banks, to take any action of the type
specified in the Loan Documents as being within such Agent's rights, duties,
powers or discretion. Each Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with written
instructions signed by the Required Banks (or all of the Banks, as applicable),
and such instructions and any action taken or failure to act pursuant thereto
shall be binding on all of the Banks and on all holders of the Notes. In the
absence of a request by the Required Banks, each Agent shall have authority, in
its sole discretion, to take or not to take any action, unless the Loan
Documents specifically require the consent of the Required Banks or all of the
Banks.
Section 10.7. Employment of Agents and Counsel. Each Agent may execute any
of its duties as Agent hereunder by or through employees, agents, and attorneys-
in-fact and shall not be answerable to the Banks, except as to money or
securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it in good faith
and with reasonable care. Each Agent shall be entitled to advice and opinion of
legal counsel concerning all matters pertaining to the duties of the agencies
hereby created.
Section 10.8. Reliance on Documents; Counsel. Each Agent shall be entitled
to rely upon any note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of legal counsel selected by such Agent.
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Section 10.9. May Treat Payee as Owner. Each Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment or transfer thereof shall have been filed
with such agent. Any request, authority or consent of any person, firm or
corporation who at the time of making such request or giving such authority or
consent is the holder of any such Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note issued in
exchange therefor.
Section 10.10. Agents' Reimbursement. Each Bank agrees to reimburse each
Agent pro rata in accordance with its Commitment Percentage for any reasonable
out-of-pocket expenses (including fees and charges for inspections) not
reimbursed by the Borrowers (a) for which such Agent is entitled to
reimbursement by the Borrowers under the Loan Documents and (b) for any other
reasonable expenses incurred by such Agent on behalf of the Banks, in connection
with the preparation, execution, delivery, administration and enforcement of the
Loan Documents.
Section 10.11. Rights as a Bank. With respect to its commitment, Loans
made by it, and the Notes issued to it, each Agent shall have the same rights
and powers hereunder as any Bank and may exercise the same as though it were not
such Agent, and the term "Bank" or "Banks" shall, unless the context otherwise
indicates, include each Agent in its individual capacity. Each Agent may accept
deposits from, lend money to, and generally engage in any kind of banking or
trust business with the Borrowers as if it were not such Agent.
Section 10.12. Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon any Agent or any other Bank and based on
the financial statements referred to in Section 5.2 and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into the Loan Documents. Each Bank also acknowledges that it
will, independently and without reliance upon any Agent or any other Bank and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents.
Section 10.13. Resignation of Agent. Subject to the appointment of a
successor Agent, each Agent may resign as Agent for the Banks under this
Agreement and the other Loan Documents at any time by thirty days' notice in
writing to the Banks. Such resignation shall take effect upon appointment of
such successor. The Required Banks shall have the right to appoint a successor
Agent, subject to the prior consent of the Borrowers (which consent shall not be
unreasonably withheld or delayed), who shall be entitled to all of the rights
of, and vested with the same powers as, the original Agent under the Loan
Documents. In the event a successor Agent shall not have been appointed within
the sixty day period following the giving of notice by any Agent, such Agent may
appoint its own successor. Resignation by any Agent shall not affect or impair
the rights of such Agent under Sections 10.5 and 10.10 hereof with respect to
all matters preceding such resignation. Any successor Agent must be either a
Bank or a national banking association or a bank chartered in any State of the
United States, in each case having capital and surplus of not less than
$500,000,000.
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Section 10.14. Duration of Agency. The agency established by Section 10.1
hereof shall continue, and Sections 10.1 through and including this Section
10.14 shall remain in full force and effect, until the Notes and all other
amounts due hereunder and thereunder shall have been paid in full and the Banks'
commitments to extend credit to or for the benefit of the Borrowers shall have
terminated or expired.
Section 10.15. Syndication Agent and Co-Agents. Nothing in this agreement
shall impose any obligation on Bank of Montreal in its capacity as Syndication
Agent or any Co-Agent.
Section 11. Miscellaneous.
Section 11.1. Amendments and Waivers. Any term, covenant, agreement or
condition of this Agreement may be amended only by a written amendment executed
by the Borrowers, the Required Banks and, if the rights or duties of the
Administrative Agent are materially affected thereby, the Administrative Agent,
or compliance therewith only may be waived (either generally or in a particular
instance and either retroactively or prospectively), if the Borrowers shall have
obtained the consent in writing of the Required Banks and, if the rights or
duties of the Administrative Agent are materially affected thereby, the
Administrative Agent, provided, however, that without the consent in writing of
the holders of all outstanding Notes, or all Banks if no Notes are outstanding,
no such amendment or waiver shall (i) change the amount or postpone the date of
payment of any scheduled payment or required prepayment of principal of the
Notes or reduce the rate or extend the time of payment of interest on the Notes,
or reduce the amount of principal thereof, or modify any of the provisions of
the Notes with respect to the payment or prepayment thereof, (ii) give to any
Note any preference over any other Notes, (iii) amend the definition of Required
Banks, (iv) alter, modify or amend the provisions of this Section 11.1, (v)
change the amount or term of any of the Banks' Revolving Credit Commitments or
the fees required under Section 3.2 hereof, (vi) alter, modify or amend any
Bank's right hereunder to consent to any action, make any request or give any
notice, or (vii) release any Guarantor of its obligations under the Guaranty
Agreement. Any such amendment or waiver shall apply equally to all Banks and
the holders of the Notes and shall be binding upon them, upon each future holder
of any Note and upon each Borrower, whether or not such Note shall have been
marked to indicate such amendment or waiver. No such amendment or waiver shall
extend to or affect any obligation not expressly amended or waived.
Section 11.2. Waiver of Rights. No delay or failure on the part of the
Administrative Agent or any Bank or on the part of the holder or holders of any
Note in the exercise of any power or right shall operate as a waiver thereof,
nor as an acquiescence in any Potential Default or Event of Default, nor shall
any single or partial exercise of any power or right preclude any other or
further exercise thereof, or the exercise of any other power or right, and the
rights and remedies hereunder of the Administrative Agent, the Banks and of the
holder or holders of any Notes are cumulative to, and not exclusive of, any
rights or remedies which any of them would otherwise have.
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Section 11.3. Several Obligations. The commitments of each of the Banks
hereunder shall be the several obligations of each Bank and the failure on the
part of any one or more of the Banks to perform hereunder shall not affect the
obligation of the other Banks hereunder, provided that nothing herein contained
shall relieve any Bank from any liability for its failure to so perform. In the
event that any one or more of the Banks shall fail to perform its commitment
hereunder, all payments thereafter received by the Administrative Agent on the
principal of Loans hereunder, shall be distributed by the Administrative Agent
to the Banks making such additional Loans ratably as among them in accordance
with the principal amount of additional Loans made by them until such additional
Loans shall have been fully paid and satisfied. All payments on account of
interest shall be applied as among all the Banks ratably in accordance with the
amount of interest owing to each of the Banks as of the date of the receipt of
such interest payment.
Section 11.4. Non-Business Day. If any payment of principal or interest on
any Loan shall fall due on a day which is not a Business Day, interest at the
rate such Loan bears for the period prior to maturity shall continue to accrue
on such principal from the stated due date thereof to and including the next
succeeding Business Day on which the same is payable.
Section 11.5. Documentary Taxes. The Borrowers agree to pay any documentary
or similar taxes with respect to the Loan Documents, including interest and
penalties, in the event any such taxes are assessed irrespective of when such
assessment is made and whether or not any credit is then in use or available
hereunder.
Section 11.6. Representations. All representations and warranties made
herein or in certificates given pursuant hereto shall survive the execution and
delivery of this Agreement and of the Notes, and shall continue in full force
and effect with respect to the date as of which they were made and as reaffirmed
on the date of each borrowing and as long as any credit is in use or available
hereunder.
Section 11.7. Notices. Unless otherwise expressly provided herein, all
communications provided for herein shall be in writing or by telecopy and shall
be deemed to have been given or made when served personally, when an answer back
is received in the case of notice by telecopy or 3 Business Days after the date
when deposited in the United States mail addressed if to any Borrower to P.O.
Box 388, Yazoo City, Mississippi 39194, Attention: Corporate Secretary; if to
the Administrative Agent or Harris at 111 West Monroe Street, Chicago, Illinois
60690, Attention: Agribusiness Group; and if to any of the Banks, at the
address for each Bank set forth under its signature hereon; or at such other
address as shall be designated by any party hereto in a written notice to each
other party pursuant to this Section 11.7.
Section 11.8. Costs and Expenses; Indemnity. (a) Each Borrower jointly and
severally agrees to pay on demand and upon receipt of supporting statements, all
reasonable costs and expenses of the Administrative Agent, in connection with
the negotiation, preparation, execution and delivery of this Agreement, the
Notes and the other instruments and documents to be delivered hereunder or in
connection with the transactions contemplated hereby, including the reasonable
fees and expenses of Messrs. Chapman and Cutler, special counsel to the
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Administrative Agent (such fees and expenses of such special counsel shall not
exceed the amount previously agreed to by the Company and the Administrative
Agent); all reasonable costs and expenses of the Administrative Agent, the Banks
and any other holder of any Note (including reasonable attorneys' fees) incurred
while any Potential Default or Event of Default shall have occurred and be
continuing, all reasonable costs and expenses incurred by the Administrative
Agent in connection with any consents or waivers hereunder or amendments hereto,
and all reasonable costs and expenses (including reasonable attorneys' fees), if
any, incurred by the Administrative Agent, the Banks or any other holders of a
Note in connection with the enforcement of this Agreement or the Notes and the
other instruments and documents to be delivered hereunder. Each Borrower jointly
and severally agrees to indemnify and save harmless the Banks and the
Administrative Agent from any and all liabilities, losses, reasonable costs and
expenses incurred by the Banks or the Administrative Agent in connection with
any action, suit or proceeding brought against the Administrative Agent or any
Bank by any Person which arises out of the transactions contemplated or financed
hereby or by the Notes, or out of any action or inaction by the Administrative
Agent or any Bank hereunder or thereunder, except for such thereof as is caused
by the gross negligence or willful misconduct of the party indemnified.
(b) Without limiting the generality of the foregoing, the Borrowers jointly
and severally unconditionally agree to forever indemnify, defend and hold
harmless, the Agent and each Bank, and covenant not to sue for any claim for
contribution against, the Agent or any Bank for any damages, reasonable costs,
loss or reasonable expense, including without limitation, response, remedial or
removal costs, arising out of any of the following: (i) any presence, release,
threatened release or disposal of any hazardous or toxic substance or petroleum
by any Borrower or any Subsidiary or otherwise occurring on or with respect to
its Property, (ii) the operation or violation of any Environmental Law, whether
federal, state, or local, and any regulations promulgated thereunder, by any
Borrower or any Subsidiary or otherwise occurring on or with respect to its
Property, (iii) any claim for personal injury or property damage in connection
with any Borrower or any Subsidiary or otherwise occurring on or with respect to
its Property, and (iv) the inaccuracy or breach of any environmental
representation, warranty or covenant by any Borrower made herein or in any loan
agreement, promissory note, mortgage, deed of trust, security agreement or any
other instrument or document evidencing or securing any indebtedness,
obligations or liabilities of any Borrower owing to the Agent or any Bank or
setting forth terms and conditions applicable thereto or otherwise relating
thereto, except for damages arising from the Agent's or such Bank's willful
misconduct or gross negligence. This indemnification shall survive the payment
and satisfaction of all indebtedness, obligations and liabilities of the
Borrowers owing to the Agent and the Banks and the termination of this
Agreement, and shall remain in force beyond the payment or satisfaction in full
of any single claim under this indemnification. This indemnification shall be
binding upon the successors and assigns of each Borrower and shall inure to the
benefit of Agent and the Banks and their respective directors, officers,
employees, agents, and collateral trustees, and their successors and assigns.
(c) The provisions of this Section 11.8 shall survive payment of the Notes
and the termination of the Revolving Credit Commitments hereunder.
47
<PAGE>
Section 11.9. Counterparts. This Agreement may be executed in any number of
counterparts and all such counterparts taken together shall be deemed to
constitute one and the same instrument. One or more of the Banks may execute a
separate counterpart of this Agreement which has also been executed by the
Borrowers, and this Agreement shall become effective as and when all of the
Banks have executed this Agreement or a counterpart thereof and lodged the same
with the Administrative Agent.
Section 11.10. Successors and Assigns; Governing Law; Entire Agreement.
This Agreement shall be binding upon each of the Borrowers, the Administrative
Agent and the Banks and their respective successors and assigns, and shall inure
to the benefit of the Borrowers, the Administrative Agent and each of the Banks
and the benefit of their respective successors and assigns, including any
subsequent holder of any Note. This Agreement and the rights and duties of the
parties hereto shall be construed and determined in accordance with the internal
laws of the State of Illinois. This Agreement constitutes the entire
understanding of the parties with respect to the subject matter hereof and any
prior agreements, whether written or oral, with respect thereto are superseded
hereby. The Borrowers may not assign any of their respective rights or
obligations hereunder without the written consent of the Banks.
Section 11.11. No Joint Venture. Nothing contained in this Agreement shall
be deemed to create a partnership or joint venture among the parties hereto.
Section 11.12. Severability. In the event that any term or provision hereof
is determined to be unenforceable or illegal, it shall be deemed severed
herefrom to the extent of the illegality and/or unenforceability and all other
provisions hereof shall remain in full force and effect.
Section 11.13. Table of Contents and Headings. The table of contents and
section headings in this Agreement are for reference only and shall not affect
the construction of any provision hereof.
Section 11.14. Sharing of Payments. Each Bank agrees with each other Bank
that if such Bank shall receive and retain any payment, whether by set-off or
application of deposit balances or otherwise ("Set-Off"), on any Loan or other
amount outstanding under this Agreement or the other Loan Documents in excess of
its ratable share of payments on all Loans and other amounts then outstanding to
the Banks, then such Bank shall purchase for cash at face value, but without
recourse (except for defects in title), ratably from each of the other Banks
such amount of the Loans held by each such other Bank (or interest therein) as
shall be necessary to cause such Bank to share such excess payment ratably with
all the other Banks; provided, however, that if any such purchase is made by any
Bank, and if such excess payment or part thereof is thereafter recovered from
such purchasing Bank, the related purchases from the other Banks shall be
rescinded ratably and the purchase price restored as to the portion of such
excess payment so recovered, but without interest. Each Bank's ratable share of
any such Set-Off shall be determined by the proportion that the aggregate
principal amount of Loans and other amounts then due and payable to such Bank
bears to the total aggregate principal amount of Loans and other amounts then
due and payable to all the Banks.
48
<PAGE>
Section 11.15. Jurisdiction; Venue'. Each Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Northern
District of Illinois and of any Illinois court sitting in Chicago for purposes
of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. Each Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
Section 11.16. Participants and Note Assignees. Each Bank shall have the
right at its own cost to grant participations (to be evidenced by one or more
agreements or certificates of participation) in the Loans made and Revolving
Credit Commitment held, by such Bank at any time and from time to time, and to
assign its rights under such Loans or the Notes evidencing such Loans to one or
more other Persons; provided that (i) no such participation or assignment shall
relieve any Bank of any of its obligations under this Agreement, (ii) no such
assignee or participant shall have any rights under this Agreement except as
provided in this Section 11.16, and (iii) the Administrative Agent shall have no
obligation or responsibility to such participant or assignee, except that
nothing herein is intended to affect the rights of an assignee of a Note to
enforce the Note assigned. Any party to which such a participation or
assignment has been granted shall have the benefits of Section 1.6 and Section
9.3, but shall not be entitled to receive any greater payment under either such
Section than the Bank granting such participation or assignment would have been
entitled to receive in connection with the rights transferred. Any agreement
pursuant to which any Bank may grant such a participating interest shall provide
that such Bank shall retain the sole right and responsibility to enforce the
obligations of the Borrower hereunder, including, without limitation, the right
to approve any amendment, modification or waiver of any provision of this
Agreement; provided that such participation agreement may provide that such Bank
will not agree to any modification, amendment or waiver of this Agreement that
would (A) increase any Revolving Credit Commitment of such Bank if such increase
would also increase the participant's obligations, (B) forgive any amount of or
postpone the date for payment of any principal of or interest on any Loan or of
any fee payable hereunder in which such participant has an interest or (C)
reduce the stated rate at which interest or fees in which such participant has
an interest accrue hereunder.
Section 11.17. Assignment of Commitments by Banks. Each Bank shall have the
right at any time, with the written consent of the Borrowers and Administrative
Agent (which consent will not be unreasonably withheld) to assign all or any
part of its Revolving Credit Commitment to one or more other Persons; provided
that (i) each such assignment shall be of a constant, and not a varying,
percentage of all such rights and obligations, (ii) unless both parties to the
assignment are Banks immediately prior to giving effect to the assignment, the
amount of the Revolving Credit Commitment of the assigning Bank being assigned
pursuant to each such assignment (determined as of the date of such assignment)
shall not be less than $10,000,000 (or if less, the entire amount of such Bank's
Revolving Credit Commitment, or $1,000,000 if such assignment is from one Bank
to another) and shall be an integral multiple of $1,000,000, (iii) the parties
to each such assignment shall execute and deliver to the Administrative Agent,
for its
49
<PAGE>
acceptance and recording, an assignment and acceptance, together with
any Notes subject to such assignment, and (iv) neither the consent of the
Borrowers nor of the Administrative Agent shall be required for any Bank to
assign all or part of its Revolving Credit Commitment to any affiliate of the
assigning Bank or to any Bank; provided further, however, that each such
assigning Bank, unless assigning all of its Revolving Credit Commitment
hereunder and under the Chemical Credit Agreement, maintains a minimum Revolving
Credit Commitment hereunder which, together with its revolving credit commitment
under the Chemical Credit Agreement, is not less than $10,000,000. Upon any
such assignment (except any assignment made pursuant to Sections 1.2 or 9.7(b)
hereof), its notification to the Administrative Agent and the payment of a
$3,000 recordation fee to the Administrative Agent, the assignee shall become a
Bank hereunder, all Loans and the Revolving Credit Commitment it thereby holds
shall be governed by all the terms and conditions hereof, and the Bank granting
such assignment shall have its Revolving Credit Commitment, and its obligations
and rights in connection therewith, reduced by the amount of such assignment and
Section 1.1(b) hereof shall be automatically amended, without further action, to
reflect the addition of such assignee as a Bank and the reduction of the
Revolving Credit Commitment of the assignor as described in such assignment.
Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall be a contract between us for the purposes hereinabove set forth.
Dated as of December 23, 1996.
FIRST MISSISSIPPI CORPORATION
By:
-------------------------------------
Its:
-------------------------------------
AMPRO FERTILIZER, INC.
By:
-------------------------------------
Its:
-------------------------------------
50
<PAGE>
Accepted and Agreed to as of the day and year last above written.
HARRIS TRUST AND SAVINGS BANK
individually and as Administrative Agent
By:
---------------------------------------
Its Senior Vice President
Address: 111 West Monroe Street
Chicago, Illinois 60690
Attention: Agribusiness Division
Eurodollar Lending Office:
Nassau Branch
111 West Monroe Street
Chicago, Illinois 60603
CAISSE NATIONALE DE CREDIT AGRICOLE
By:
---------------------------------------
Its:
---------------------------------------
By:
---------------------------------------
Its:
---------------------------------------
Address: 55 East Monroe Street
Chicago, Illinois 60603-5702
Attention: Ted Tice
Eurodollar Lending Office:
------------------------
------------------------
51
<PAGE>
CIBC INC.
By:
----------------------------------------
Its:
---------------------------------------
Address: Two Paces West
2227 Paces Ferry Road
Suite 1200
Atlanta, Georgia 30339
Attention: Bill Humphries
Eurodollar Lending Office:
-----------------------
-----------------------
BANQUE NATIONALE DE PARIS,
HOUSTON AGENCY
By:
---------------------------------------
Its:
---------------------------------------
Address: 717 North Harwood Street
Suite 2630
Dallas, Texas 75201
Attention: David P. Camp
Eurodollar Lending Office:
-----------------------
-----------------------
52
<PAGE>
BANK OF AMERICA ILLINOIS
By:
---------------------------------------
Its:
---------------------------------------
Address: 1230 Peachtree Street
Suite 3800
Atlanta, Georgia 30309
Attention: Rich Wilson
Eurodollar Lending Office:
---------------------------
---------------------------
COMMERZBANK
AKTIENGESELLSCHAFT, ATLANTA
AGENCY
By:
--------------------------------------
Its:
--------------------------------------
By:
--------------------------------------
Its:
--------------------------------------
Address: 1230 Peachtree NE
Atlanta, Georgia 30309
Attention: Mark Wortmann
Eurodollar Lending Office:
---------------------------
---------------------------
53
<PAGE>
BANQUE PARIBAS
By:
---------------------------------------
Its:
---------------------------------------
Address: 1200 Smith
Suite 3100
Houston, Texas 77002
Attention: Roger May
Eurodollar Lending Office:
---------------------------
---------------------------
THE BANK OF NOVA SCOTIA, ATLANTA
AGENCY
By:
---------------------------------------
Its:
---------------------------------------
Address:
----------------------
----------------------
----------------------
Attention:
------------
Eurodollar Lending Office:
---------------------------
---------------------------
54
<PAGE>
SUNTRUST BANK, ATLANTA
By:
---------------------------------------
Its:
---------------------------------------
By:
---------------------------------------
Its:
---------------------------------------
Address: 25 Park Place
25th Floor
Atlanta, Georgia 30303
Attention: Greg Cannon
Eurodollar Lending Office:
---------------------------
---------------------------
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By:
---------------------------------------
Its:
---------------------------------------
Address: 301 South College Street
Fifth Floor
Charlotte, North Carolina
28288-0745
Attention: Tom Bohrer
Eurodollar Lending Office:
---------------------------
---------------------------
55
<PAGE>
ABN AMRO BANK N.V.
By:
---------------------------------------
Its:
---------------------------------------
By:
---------------------------------------
Its:
---------------------------------------
Address: 1 Ravinia Drive
Suite 1200
Atlanta, Georgia 30346
Attention: Michael VanCranenburgh
Eurodollar Lending Office:
-----------------------
-----------------------
THE FUJI BANK, LIMITED
By:
---------------------------------------
Its:
---------------------------------------
Address: Suite 2100
The Marquis One Tower
245 Peachtree Center Ave. NE
Atlanta, Georgia 30303
Attention: Brett Johnson
Eurodollar Lending Office:
-----------------------
-----------------------
56
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.
By:
---------------------------------------
Its:
---------------------------------------
Address: 1100 Louisiana Street
Suite 4940
Houston, Texas 77002
Attention: Warren Ross
Eurodollar Lending Office:
-----------------------
-----------------------
HIBERNIA NATIONAL BANK
By:
---------------------------------------
Its:
---------------------------------------
Address: 313 Carondelet
New Orleans, Louisiana 70130
Attention: Trudy Nelson
Eurodollar Lending Office:
-----------------------
-----------------------
57
<PAGE>
DEPOSIT GUARANTY NATIONAL BANK
By:
---------------------------------------
Its:
---------------------------------------
Address: 210 East Capital
Suite 1180
Jackson, Mississippi 39201
Attention: Stanley A. Herren
Eurodollar Lending Office:
-----------------------
-----------------------
58
<PAGE>
EXHIBIT 10.2
================================================================================
CREDIT AGREEMENT
AMONG
MISSISSIPPI CHEMICAL CORPORATION
MISSISSIPPI PHOSPHATES CORPORATION
MISSISSIPPI POTASH, INC.
AND
THE LENDERS PARTY HERETO
AND
HARRIS TRUST AND SAVINGS BANK,
as Administrative Agent
AND
BANK OF MONTREAL, CHICAGO BRANCH,
as Syndication Agent
AND
CAISSE NATIONALE DE CREDIT AGRICOLE
CIBC INC.
AS CO-AGENTS
DATED AS OF DECEMBER 23, 1996
================================================================================
<PAGE>
TABLE OF CONTENTS
MISSISSIPPI CHEMICAL CORPORATION
MISSISSIPPI PHOSPHATES CORPORATION
MISSISSIPPI POTASH, INC.
CREDIT AGREEMENT
SECTION 1. THE REVOLVING CREDIT AND SWING LINE............................ 1
Section 1.1. The Revolving Credit.................................... 1
Section 1.2. Swingline Loans under the Revolving Credit.............. 4
(a) Swingline Commitment.................................... 4
(b) Refunding Loans......................................... 4
(c) Participations.......................................... 5
Section 1.3. Interest Rates.......................................... 5
(a) Base Rate Loans......................................... 5
(b) Eurodollar Loans........................................ 5
(c) Fed Funds Rate Loans.................................... 5
(d) Default Rate............................................ 5
Section 1.4. Conversion and Continuation of Loans.................... 6
Section 1.5. Letters of Credit....................................... 6
Section 1.6. Reimbursement Obligation................................ 8
Section 1.7. Manner of Borrowing Revolving Credit Loans and Swingline
Loans................................................... 8
Section 1.8. Participation in L/Cs................................... 9
Section 1.9. Capital Adequacy........................................10
Section 1.10. Absolute Obligations....................................11
SECTION 2. THE BID FACILITY.................................................11
Section 2.1. The Bid Loans...........................................11
Section 2.2. Requests for Bid Loans..................................12
(a) Requests and Confirmations..............................12
(b) Invitation to Bid.......................................12
(c) Bids....................................................12
Section 2.3. Notice of Bids..........................................13
Section 2.4. Acceptance or Rejection of Bids.........................13
Section 2.5. Notice of Acceptance or Rejection of Bids...............14
(a) Notice to Banks Making Successful Bids..................14
(b) Notice to all Banks.....................................14
(c) Disbursement of Bid Loans...............................14
(d) Interest on Bid Loans...................................14
Section 2.6. Telephonic Notice.......................................15
SECTION 3. THE NOTES, FEES, PREPAYMENTS, TERMINATIONS
AND APPLICATION OF PAYMENTS......................................15
Section 3.1. The Notes...............................................15
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<PAGE>
Section 3.2. Facility Fee............................................ 16
Section 3.3. Agent's Fees............................................ 16
Section 3.4. 16
(a) Optional Prepayments of Base Rate Loans................. 16
(b) Optional Prepayments of Swingline Loans................. 16
(c) Optional Prepayments of Eurodollar Loans................ 17
(d) Mandatory Prepayments of Excess Borrowings.............. 17
Section 3.5. Revolving Credit Termination............................ 17
Section 3.6. Place and Application of Payments....................... 17
Section 3.7. Closing Fee............................................. 18
SECTION 4. DEFINITIONS...................................................... 18
Section 4.1. Certain Definitions..................................... 18
Section 4.2. Accounting Terms........................................ 28
SECTION 5. REPRESENTATIONS AND WARRANTIES................................... 29
Section 5.1. Organization and Qualification; Non-Contravention....... 29
Section 5.2. Financial Reports....................................... 29
Section 5.3. Litigation; Tax Returns; Approvals...................... 29
Section 5.4. Regulation U............................................ 30
Section 5.5. No Default.............................................. 30
Section 5.6. ERISA................................................... 30
Section 5.7. Debt and Security Interests............................. 30
Section 5.8. Subsidiaries and Guarantors............................. 30
Section 5.9. Accurate Information.................................... 31
Section 5.10. Enforceability.......................................... 31
Section 5.11. Restrictive Agreements.................................. 31
Section 5.12. No Violation of Law..................................... 31
Section 5.13. No Default Under Other Agreements....................... 31
Section 5.14. Status Under Certain Laws............................... 31
SECTION 6. CONDITIONS PRECEDENT............................................. 32
Section 6.1. Initial Extension of Credit............................. 32
Section 6.2. Each Extension of Credit................................ 34
Section 6.3. Legal Matters........................................... 34
Section 6.4. Documents............................................... 35
SECTION 7. COVENANTS ....................................................... 35
Section 7.1. Maintenance of Property................................. 35
Section 7.2. Taxes................................................... 35
Section 7.3. Maintenance of Insurance................................ 35
Section 7.4. Financial Reports....................................... 35
Section 7.5. Inspection.............................................. 36
Section 7.6. Consolidation and Merger................................ 37
Section 7.7. Transactions with Affiliates............................ 37
-ii-
<PAGE>
Section 7.8. Dividends and Certain Other Restricted Payments......... 38
Section 7.9. Liens................................................... 38
Section 7.10. Borrowings and Guaranties............................... 39
Section 7.11. Investments, Loans, Advances and Acquisitions........... 40
Section 7.12. Sale of Property........................................ 41
Section 7.13. Notice of Suit or Adverse Change in Business or Default. 42
Section 7.14. ERISA................................................... 42
Section 7.15. Use of Proceeds......................................... 42
Section 7.16. Compliance with Laws, etc............................... 43
Section 7.17. Sale and Leaseback Transactions......................... 43
Section 7.18. Triad Chemical Product Withdrawal Agreement............. 43
Section 7.19. Fiscal Quarters......................................... 43
Section 7.20 New Subsidiaries........................................ 43
Section 7.21. Maximum Leverage Ratio.................................. 43
Section 7.22. Minimum Interest Coverage Ratio......................... 43
Section 7.23. Minimum Tangible Net Worth.............................. 43
SECTION 8. EVENTS OF DEFAULT AND REMEDIES................................... 44
Section 8.1. Definitions............................................. 44
Section 8.2. Remedies for Non-Bankruptcy Defaults.................... 45
Section 8.3. Remedies for Bankruptcy Defaults........................ 46
Section 8.4. L/Cs.................................................... 46
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING
FIXED RATE LOANS................................................. 46
Section 9.1. Change of Law........................................... 46
Section 9.2. Unavailability of Deposits or Inability to
Ascertain the Adjusted Eurodollar Rate.................. 46
Section 9.3. Taxes and Increased Costs............................... 47
Section 9.4. Funding Indemnity....................................... 48
Section 9.5. Lending Branch.......................................... 48
Section 9.6. Discretion of Bank as to Manner of Funding.............. 48
Section 9.7. Mitigation of Circumstances............................. 49
SECTION 10. THE AGENTS...................................................... 50
Section 10.1. Appointment and Powers.................................. 50
Section 10.2. Powers.................................................. 50
Section 10.3. General Immunity........................................ 50
Section 10.4. No Responsibility for Loans, Recitals, etc.............. 50
Section 10.5. Right to Indemnity...................................... 50
Section 10.6. Action Upon Instructions of Banks....................... 50
Section 10.7. Employment of Agents and Counsel........................ 51
Section 10.8. Reliance on Documents; Counsel.......................... 51
Section 10.9. May Treat Payee as Owner................................ 51
Section 10.10. Agents' Reimbursement................................... 51
-iii-
<PAGE>
Section 10.11. Rights as a Bank........................................ 51
Section 10.12. Bank Credit Decision.................................... 51
Section 10.13. Resignation of Agent.................................... 52
Section 10.14. Duration of Agency...................................... 52
Section 10.15. Syndication Agent and Co-Agents........................ 52
SECTION 11. MISCELLANEOUS................................................... 52
Section 11.1. Amendments and Waivers.................................. 52
Section 11.2. Waiver of Rights........................................ 53
Section 11.3. Several Obligations..................................... 53
Section 11.4. Non-Business Day........................................ 53
Section 11.5. Documentary Taxes....................................... 53
Section 11.6. Representations......................................... 54
Section 11.7. Notices................................................. 54
Section 11.8. Costs and Expenses; Indemnity........................... 54
Section 11.9. Counterparts............................................ 55
Section 11.10. Successors and Assigns.................................. 55
Section 11.11. No Joint Venture........................................ 56
Section 11.12. Severability............................................ 56
Section 11.13. Table of Contents and Headings.......................... 56
Section 11.14. Sharing of Payments..................................... 56
Section 11.15. Jurisdiction............................................ 56
Section 11.16. Participants and Note Assignees......................... 56
Section 11.17. Assignment of Commitments by Banks...................... 57
Signature Page ............................................................. 58
Exhibit A Revolving Credit Note
Exhibit B Application and Agreement for Letter of Credit
Exhibit C Bid Loan Request Confirmation
Exhibit D Invitation to Bid
Exhibit E Confirmation of Bid
Exhibit F Notice of Acceptance of Bid
Exhibit G Schedule of Subsidiaries and Guarantors
Exhibit H Compliance Certificate
Exhibit I Form of Legal Opinion of Borrowers' Counsel
Exhibit J-1 Form of Legal Opinion of Guarantors' Counsel
Exhibit J-2 Form of Legal Opinion of Guarantors' Counsel
Exhibit J-3 Form of Legal Opinion of Guarantors' Counsel
Exhibit J-4 Form of Legal Opinion of Guarantors' Counsel
Exhibit K Farmland MissChem Project Contingent Obligations
Exhibit L Pricing Ratio Certificate
Schedule 5.3. Litigation
Schedule 6.1(i) Real Property Subject to a Phase I Environmental Assessment
-iv-
<PAGE>
MISSISSIPPI CHEMICAL CORPORATION
MISSISSIPPI PHOSPHATES CORPORATION
MISSISSIPPI POTASH, INC.
CREDIT AGREEMENT
Harris Trust and Savings Bank
Chicago, Illinois
The from time to time lenders parties hereto
Ladies and Gentlemen:
The undersigned MISSISSIPPI CHEMICAL CORPORATION, a Mississippi
corporation ("Chemical"), MISSISSIPPI PHOSPHATES CORPORATION, a Delaware
corporation ("Phosphates") and MISSISSIPPI POTASH, INC., a Mississippi
corporation ("Potash" and, together with Chemical and Phosphates, individually a
"Borrower" and collectively the "Borrowers"), apply to you for your several
commitments, subject to all the terms and conditions hereof and on the basis of
the representations and warranties hereinafter set forth, to make a revolving
credit (the "Revolving Credit"), a swing line credit (the "Swing Line") and a
competitive bid facility (the "Bid Facility") available to the Borrowers, all as
more fully hereinafter set forth. Each of you is hereinafter referred to
individually as "Bank" and collectively as "Banks." Harris Trust and Savings
Bank in its individual capacity is sometimes referred to herein as "Harris", and
in its capacity as Administrative Agent for the Banks is hereinafter in such
capacity called the "Administrative Agent." Bank of Montreal in its capacity as
Syndication Agent for the Banks is hereinafter in such capacity called the
"Syndication Agent." Caisse Nationale de Credit Agricole and CIBC Inc., in their
capacity as Co-Agents for the Banks are hereinafter in such capacity
collectively called the "Co-Agents." All capitalized terms not defined in the
text of this Agreement are defined in Section 4 hereof.
SECTION 1. THE REVOLVING CREDIT AND SWING LINE.
Section 1.1. The Revolving Credit.; (a) Subject to all of the terms and
conditions hereof, the Banks agree, severally and not jointly, to extend a
Revolving Credit to the Borrowers which may be utilized by the Borrowers in the
form of loans (individually a "Revolving Credit Loan" and collectively the
"Revolving Credit Loans") and L/Cs (as hereinafter defined). The aggregate
principal amount of all Loans (as hereinafter defined) plus the maximum amount
available for drawing under all L/Cs and the aggregate principal amount of all
unpaid Reimbursement Obligations (as hereinafter defined) at any time
outstanding (collectively the "Revolving Credit Obligations") may not exceed the
sum of the Revolving Credit Commitments (as hereinafter defined) at any time.
The Revolving Credit shall be available to the Borrowers, and may be availed of
by the Borrowers from time to time, be repaid (subject to the restrictions
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<PAGE>
on prepayment set forth herein) and used again, during the period from the date
hereof to and including December 23, 2001 (as the same may be extended from time
to time in accordance with the provisions of Section 1.1(d) hereof, the
"Termination Date"), at which time the entire outstanding principal amount of
all Revolving Credit Obligations, together with all accrued and unpaid interest
thereon, shall be due and payable.
(b) The respective maximum aggregate principal amounts of the
Revolving Credit at any one time outstanding and the percentage (the "Commitment
Percentage") of the Revolving Credit available at any time which each Bank by
its acceptance hereof severally agrees to make available to the Borrowers are as
follows (collectively, the "Revolving Credit Commitments" and individually, a
"Revolving Credit Commitment"):
<TABLE>
<CAPTION>
<S> <C> <C>
Harris Trust and Savings Bank $19,933,333.34 13.33333334%
Caisse Nationale de Credit Agricole $18,687,500.00 12.50000000%
CIBC Inc. $18,687,500.00 12.50000000%
Banque Nationale de Paris, Houston Agency $12,458,333.33 8.33333333%
Bank of America Illinois $9,966,666.67 6.66666667%
Commerzbank Aktiengesellschaft, $9,966,666.67 6.66666667%
Atlanta Agency
Banque Paribas $7,475,000.00 5.00000000%
The Bank of Nova Scotia, Atlanta Agency $7,475,000.00 5.00000000%
SunTrust Bank, Atlanta $7,475,000.00 5.00000000%
First Union National Bank of
North Carolina $7,475,000.00 5.00000000%
ABN AMRO Bank N.V. $7,475,000.00 5.00000000%
The Fuji Bank, Limited $7,475,000.00 5.00000000%
The Dai-Ichi Kangyo Bank, Ltd. $4,983,333.33 3.33333333%
Hibernia National Bank $4,983,333.33 3.33333333%
Deposit Guaranty National Bank $4,983,333.33 3.33333333%
Total $149,500,000.00 100%
</TABLE>
(c) Loans under the Revolving Credit may be Eurodollar Loans or
Base Rate Loans. Each Borrowing under the Revolving Credit shall be made by each
Bank in an amount equal to its Commitment Percentage of the amount of such
Borrowing. Each Borrowing of Base Rate Loans under the Revolving Credit shall be
in an amount not less than $5,000,000 or such greater amount which is an
integral multiple of $1,000,000 and each Borrowing of Eurodollar Loans shall be
in an amount not less than $10,000,000 or such greater amount which is an
integral multiple of $1,000,000.
(d) At any time not earlier than 120 days prior to, nor later than
90 days prior to, each date that is four years before the Termination Date then
in effect (each an "Anniversary Date"), the Borrowers may request that the Banks
extend the then scheduled Termination Date to the date one year from such
Termination Date. Each such request by the Borrowers shall be deemed to be a
representation and warranty by the Borrowers to the Banks that no material
adverse change in the financial condition of Chemical and its Subsidiaries,
taken as a whole, has occurred
-2-
<PAGE>
since the date of the most recent financial reports delivered to the Banks in
accordance with Section 7.4(b) hereof. If such request is made by the Borrowers
each Bank shall inform the Administrative Agent of its willingness to extend the
Termination Date no later than 30 days after the Banks receive such request. Any
Bank's failure to respond by such date shall indicate its unwillingness to agree
to such requested extension. At any time more than 30 days before such
Anniversary Date Banks having aggregate Commitment Percentages of at least 80%
of the Revolving Credit Commitments then in effect (the "Extending Banks") may
propose, by written notice to the Borrowers, an extension of this Agreement to
the date one year from the applicable Termination Date on such terms and
conditions as the Extending Banks may then require. If the extension of this
Agreement to the date one year from the Applicable Termination Date is
acceptable to the Borrowers on the terms and conditions proposed by the
Extending Banks, the Borrowers shall notify the Extending Banks of their
acceptance of such terms and conditions no later than the Anniversary Date, and
such later date will become the Termination Date hereunder and this Agreement
shall otherwise be amended in the manner described in the Extending Banks'
notice proposing the extension of this Agreement upon the Agent's receipt of
(i) an amendment to this Agreement signed by the Borrowers and all of the
Extending Banks, (ii) resolutions of each Borrower's Board of Directors
authorizing such extension and (iii) an opinion of counsel to the Borrowers
equivalent in form and substance to the form of opinion attached hereto as
Exhibit I and otherwise acceptable to the Extending Banks. If the Borrowers and
the Extending Banks agree upon the terms of an extension of the Termination
Date, the Borrowers may elect either (i) to terminate the Revolving Credit
Commitments of each Bank that is not an Extending Bank (each a "Nonextending
Bank") in whole on such Anniversary Date, at which time all Loans and other
amounts payable under the Loan Documents to the Nonextending Banks shall become
immediately due and payable, or (ii) to replace such Nonextending Banks with one
or more financial institutions acceptable to the Borrowers and the
Administrative Agent (each a "Replacement Bank"). If the Borrowers elect to
replace a Nonextending Bank, such replacement shall become effective as of the
date the Nonextending Banks' Revolving Credit Commitments terminate (which shall
be no later than the Anniversary Date) and all of the following conditions are
satisfied:
(A) the unpaid principal amount of all Loans and Reimbursement
Obligations made by each Nonextending Bank whose Revolving Credit
Commitment is to terminate, together with accrued interest thereon and
all other amounts payable under the Loan Documents to such Nonextending
Bank, including any facility fee accrued through the date of such
termination, shall have been paid in full and all of such Nonextending
Banks' participations in L/Cs shall have been reallocated among the
Extending Banks;
(B) such Replacement Bank shall agree in writing to be bound by
all of the terms and provisions of this Agreement, such agreement to
specify the amount of the Revolving Credit Commitment of such Replacement
Bank and to be otherwise in form and substance satisfactory to the
Administrative Agent, and shall make Loans to the Borrowers in principal
amounts which bear the same ratio to the amounts of the Loans made by the
other Extending Banks then outstanding as the Revolving Credit Commitment
of such Replacement Bank bears to the then Revolving Credit Commitments
of all other Extending Banks; and
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(C) a copy of such agreement and of evidence satisfactory to the
Administrative Agent of the making of such Loans shall be furnished to
the Administrative Agent and the Extending Banks.
Section 1.2. Swingline Loans under the Revolving Credit.; (a)
Swingline Commitment. Subject to the terms and conditions hereof and in
reliance on the obligations of the Banks to Harris under this Section 1.2,
Harris agrees to advance one or more swingline loans (each a "Swingline Loan")
to the Borrowers from time to time before the Termination Date on a revolving
basis up to $20,000,000 in aggregate principal amount at any time outstanding;
provided that Harris shall have no obligation to advance any Swingline Loan if
the Total Outstandings would thereby exceed the sum of the Revolving Credit
Commitments then in effect. All Swingline Loans will be Fed Funds Rate Loans or
Offered Rate Loans and will be in an amount not less than $250,000 or an
integral multiple of $100,000 in excess thereof. Swingline Loans may be repaid
and their principal amount reborrowed before the Termination Date, subject to
the terms and conditions hereof. Each Swingline Loan shall have a maturity of
up to the seventh day after such Swingline Loan was made. No more than 5
Swingline Loans may be outstanding at any time.
Each Borrower may elect that each Swingline Loan shall bear interest
(computed on the basis of a year of 365/366 days and actual days elapsed) on the
unpaid principal amount thereof from the date such Swingline Loan is made until
the last day of the Interest Period applicable thereto at the rate per annum
quoted to such Borrower by Harris for the Interest Period applicable thereto,
billable on the last day of each month (each such Swingline Loan is hereinafter
referred to as an "Offered Rate Loan"); provided, however, that the Borrowers
understand and agree that Harris has no obligation to quote rates or to make any
such Offered Rate Loan and may refuse to make any such Offered Rate Loan after
receiving a request therefor from any Borrower. The Borrowers acknowledge and
agree that the interest rate quoted by Harris for any Offered Rate Loan may not
be the best or lowest rate offered to other customers of Harris and may not be
the same rate offered to other customers of Harris for loans of similar amounts
and maturities, but is the rate at which Harris in its sole and exclusive
discretion is willing to make such Loan to a Borrower for the specified amount
and maturity.
(b) Refunding Loans. In its sole and absolute discretion, Harris may
at any time, on behalf of the Borrowers (each of which hereby irrevocably
authorizes Harris to act on its behalf for such purpose), request each Bank to
make a Base Rate Loan under the Revolving Credit in an amount equal to such
Bank's Commitment Percentage of the amount of the Swingline Loans outstanding on
the date such notice is given. Unless any of the conditions of Section 6.2 are
not fulfilled on such date, each Bank shall make the proceeds of its requested
Base Rate Loan available to Harris, in immediately available funds, at the
principal office of Harris in Chicago, Illinois, before 12:00 Noon (Chicago
time) on the Business Day following the day such notice is given. The proceeds
of such Base Rate Loans shall be immediately applied to repay the outstanding
Swingline Loans. Each Borrower authorizes Harris to charge such Borrower's
accounts with Harris (up to the amount available in such accounts) to pay the
amount of any such
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outstanding Swingline Loans to the extent amounts received from the Banks are
not sufficient to repay in full such Swingline Loans.
(c) Participations. If any Bank refuses or otherwise fails to make a
Revolving Credit Loan when requested by Harris pursuant to Section 1.2(b) above
(because the conditions in Section 6.2 are not satisfied or otherwise), such
Bank will, by the time and in the manner such Revolving Credit Loan was to have
been funded to Harris, purchase from Harris an undivided participating interest
in the outstanding Swingline Loans in an amount equal to its Commitment
Percentage of the aggregate principal amount of Swingline Loans that were to
have been repaid with such Revolving Credit Loans. Each Bank that so purchases
a participation in a Swingline Loan shall thereafter be entitled to receive its
Commitment Percentage of each payment of principal received on the Swingline
Loan and of interest received thereon accruing from the date such Bank funded to
Harris its participation in such Loan. The obligation of the Banks to Harris
shall be absolute and unconditional and shall not be affected or impaired by any
Event of Default or Potential Default which may then be continuing hereunder.
Section 1.3. Interest Rates. (a) Base Rate Loans. Each Base Rate Loan
shall bear interest (computed on the basis of a year of 365/366 days and actual
days elapsed) on the unpaid principal amount thereof from the date such Loan is
made until maturity (whether by acceleration, upon prepayment or otherwise) at a
rate per annum equal to the sum of the Applicable Margin and the Base Rate from
time to time in effect, payable monthly in arrears on the last day of each
calendar month, commencing on the first of such dates occurring after the date
hereof and at maturity (whether by acceleration, upon prepayment or otherwise).
(b) Eurodollar Loans. Each Eurodollar Loan under the Revolving Credit
shall bear interest (computed on the basis of a year of 360 days and actual days
elapsed) on the unpaid principal amount thereof from the date such Loan is made
until the last day of the Interest Period applicable thereto or, if earlier,
until maturity (whether by acceleration or otherwise) at a rate per annum equal
to the sum of the Applicable Margin and the Adjusted Eurodollar Rate, payable on
the last day of each Interest Period applicable thereto or at maturity (whether
by acceleration or otherwise) and, with respect to Eurodollar Loans with an
Interest Period in excess of three months, on the date occurring every three
months from the first day of the Interest Period applicable thereto.
(c) Fed Funds Rate Loans. Each Fed Funds Rate Loan shall bear
interest (computed on the basis of a year of 365/366 days and actual days
elapsed) on the principal amount thereof from the date such Loan is made until
maturity (whether by acceleration, upon prepayment or otherwise) at a rate per
annum equal to the sum of the Applicable Margin and the Fixed Fed Funds Rate
from time to time in effect, billable on the last day of each month.
(d) Default Rate. If any Event of Default shall have occurred, all
Loans and Reimbursement Obligations shall bear interest from the date such Event
of Default occurred, payable on demand, at a rate per annum equal to:
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(i) with respect to any Base Rate Loan, the sum of 2% plus the
Base Rate (computed on the basis of a year of 365/366 days and actual
days elapsed) from time to time in effect; and
(ii) with respect to any Fixed Rate Loan, the sum of 2% plus the
rate of interest in effect thereon at the time of such default (computed
on the basis of a year of 360 days and actual days elapsed) until the end
of the Interest Period then applicable thereto, and, thereafter, at a
rate per annum equal to the sum of 2% plus the Base Rate (computed on the
basis of a year of 365/366 days and actual days elapsed) from time to
time in effect.
Section 1.4. Conversion and Continuation of Loans. (a) Provided that
no Event of Default or Potential Default has occurred and is continuing, the
Borrowers shall have the right, subject to the other terms and conditions of
this Agreement, to continue in whole or in part (but, if in part, in the minimum
amount specified for Eurodollar Loans in Section 1.1 hereof) any Eurodollar Loan
from any current Interest Period into a subsequent Interest Period, provided
that such Borrower shall give the Administrative Agent notice of the
continuation of any such Loan as provided in Section 1.7 hereof.
(b) In the event that a Borrower fails to give notice pursuant to
Section 1.7 hereof of the continuation of any Eurodollar Loan or fails to
specify the Interest Period applicable thereto, or an Event of Default or
Potential Default has occurred and is continuing at the time any such Loan is to
be continued hereunder, then such Loan shall be automatically converted as (and
the relevant Borrower shall be deemed to have given notice requesting) a Base
Rate Loan, subject to Sections 8.2 and 8.3 hereof, unless paid in full on the
last day of the then applicable Interest Period.
(c) Provided that no Event of Default or Potential Default has occurred
and is continuing, the Borrowers shall have the right, subject to the terms and
conditions of this Agreement, to convert Revolving Credit Loans of one type (in
whole or in part) into Revolving Credit Loans of another type from time to time
provided that: (i) the Borrower shall give the Administrative Agent notice of
each such conversion as provided in Section 1.7 hereof, (ii) the principal
amount of any Revolving Credit Loan converted hereunder shall be in an amount
not less than the minimum amount specified for the type of Loan in Section 1.1
hereof, (iii) after giving effect to any such conversion in part, the principal
amount of any Eurodollar Loan then outstanding shall not be less than the
minimum amount specified for a Eurodollar Loan in Section 1.1 hereof, (iv) any
conversion of a Loan hereunder shall only be made on a Business Day, and (v) any
Eurodollar Loan may be converted only on the last day of the Interest Period
then applicable thereto.
Section 1.5. Letters of Credit. (a) Subject to all the terms and
conditions hereof, satisfaction of all conditions precedent to borrowing under
this Agreement and so long as no Potential Default or Event of Default is in
existence, at any Borrower's request Harris may in its discretion issue letters
of credit (an "L/C" and collectively the "L/Cs") for the account of such
Borrower subject to availability under the Revolving Credit, and the Banks
hereby agree to
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participate therein as more fully described in Section 1.8 hereof. Each L/C
shall be issued pursuant to an application for letter of credit (the "L/C
Agreement") in the form of Exhibit B hereto. The L/Cs shall consist of standby
and commercial letters of credit in an aggregate face amount not to exceed
$30,000,000. Each L/C shall have an expiry date not more than one year from the
date of issuance thereof (but in no event later than the Termination Date). The
amount available to be drawn under each L/C issued pursuant hereto shall be
deducted from the credit otherwise available under the Revolving Credit. In
consideration of the issuance of L/Cs each Borrower agrees to pay Harris for the
benefit of the Banks a fee (the "L/C Participation Fee") in the amount per annum
equal to the Applicable Margin for Eurodollar Loans (computed on the basis of a
360-day year and actual days elapsed) of the face amount for each L/C issued for
the account of such Borrower hereunder. In addition, the Borrowers shall pay
Harris (x) a fee (the "L/C Issuance Fee") in the amount per annum equal to (i)
for standby L/Cs, eight-hundredths of one percent (0.08%) of the stated amount
of each standby L/C issued hereunder and (ii) for commercial L/Cs, the customary
issuance fee for commercial L/Cs as may be established by Harris from time to
time, and (y) such drawing, negotiation, amendment and other administrative fees
in connection with each L/C as may be established by Harris from time to time
(the "L/C Administrative Fee"). All L/C Issuance Fees and L/C Participation Fees
shall be payable quarterly in arrears on the last day of each March, June,
September and December commencing December 31, 1996 and on the Termination Date,
and all L/C Administrative Fees shall be payable on the date of issuance of each
L/C hereunder and on the date required by Harris.
(b) Notwithstanding anything contained in any L/C Agreement to the
contrary: (i) the Borrowers shall pay fees in connection with each L/C as set
forth in Section 1.5(a) hereof, (ii) except as otherwise provided in Section
3.4(c) hereof, before the occurrence of a Potential Default or an Event of
Default, Harris will not call for the funding by any Borrower of any amount
under an L/C issued for such Borrower's account, or for any other form of
collateral security for a Borrower's obligations in connection with such L/C,
before being presented with a drawing thereunder, and (iii) if Harris is not
timely reimbursed for the amount of any drawing under an L/C on the date such
drawing is paid, the Borrower's obligation to reimburse Harris for the amount of
such drawing shall bear interest as specified in Section 1.6 hereof. If Harris
issues any L/C with an expiration date that is automatically extended unless
Harris gives written notice that the expiration date will not so extend beyond
its then scheduled expiration date, Harris will give such written notice of non-
renewal before the time necessary to prevent such automatic extension if before
such required notice date (i) the expiration date of such L/C if so extended
would be more than one year from the then scheduled expiration date of such L/C
or after the Termination Date, (ii) the Revolving Credit Commitments have been
terminated, or (iii) an Event of Default exists and the Required Banks have
given Harris instructions not to so permit the extension of the expiration date
of such L/C.
(c) The Administrative Agent shall give prompt telephone, telex, or
telecopy notice to each Bank of each issuance of, or amendment to, an L/C
specifying the effective date of the L/C or amendment, the amount, the
beneficiary, and the expiration date of the L/C, in each case as established
originally or through the relevant amendment, as applicable, the account party
or parties for the L/C, each Bank's pro rata participation in such L/C and
whether the
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Administrative Agent has classified the L/C as a commercial, performance, or
financial letter of credit for regulatory reporting purposes.
Section 1.6. Reimbursement Obligation. Each Borrower is obligated, and
hereby unconditionally jointly and severally agrees, to pay in immediately
available funds to Harris for the account of Harris and the Banks who are
participating in L/Cs pursuant to Section 1.8 hereof the face amount of each
draft drawn and presented under an L/C issued by Harris hereunder for any
Borrower's account (the obligation of the Borrowers under this Section 1.6 with
respect to any L/C is a "Reimbursement Obligation"). If at any time any
Borrower fails to pay any Reimbursement Obligation when due, such Borrower shall
be deemed to have automatically requested a Revolving Credit Loan from the Banks
hereunder, as of the maturity date of such Reimbursement Obligation, the
proceeds of which Loan shall be used to repay such Reimbursement Obligation.
Such Loan shall only be made if all of the conditions precedent set forth in
Section 6.2 of this Agreement have been satisfied. If such Loan is not made by
the Banks for any reason, the unpaid amount of such Reimbursement Obligation
shall be due and payable to Harris for the pro rata benefit of the Banks upon
demand and shall bear interest at the rate of interest specified in Section
1.3(a), unless an Event of Default has occurred then the rate of interest
specified in Section 1.3(d)(i) hereof.
Section 1.7. Manner of Borrowing Revolving Credit Loans and Swingline
Loans. (a) Chemical shall give telephonic, telex or telecopy notice to the
Administrative Agent (which notice, if telephonic, shall be promptly confirmed
in writing) no later than (i) 12:00 Noon (Chicago time) on the date the Banks
are requested to make each Borrowing of Base Rate Loans, (ii) 12:00 Noon
(Chicago time) on the date at least three (3) Business Days prior to the date of
(A) each Borrowing of Eurodollar Loans which the Banks are requested to make or
continue, and (B) the conversion of any Borrowing of Base Rate Loans into a
Borrowing of Eurodollar Loans, and (iii) 12:00 Noon (Chicago time) on the date a
Borrower requests the Administrative Agent to make a Swingline Loan hereunder.
Each such notice shall be irrevocable and shall specify the Borrower requesting
such Borrowing, the date of the Borrowing requested (which shall be a Business
Day), the amount of such Borrowing, whether the Borrowing is to be made
available by means of Base Rate Loans or Eurodollar Loans and, with respect to a
Borrowing of Eurodollar Loans, the Interest Period applicable thereto; provided,
that in no event shall the principal amount of any requested Revolving Credit
Loan plus the aggregate principal or face amount, as appropriate, of all Loans,
L/Cs, and unpaid Reimbursement Obligations outstanding hereunder exceed the
Revolving Credit Commitments as such amounts may be reduced pursuant to Section
3.5 of this Agreement. The Borrowers agree that the Administrative Agent may
rely on any such telephonic, telex or telecopy notice given by any person who
the Administrative Agent reasonably believes is authorized to give such notice
without the necessity of independent investigation and in the event any notice
by such means conflicts with the written confirmation, such notice shall govern
if the Administrative Agent or any Bank has acted in reliance thereon. The
Administrative Agent shall, on the day any such notice is received by it, give
prompt telephonic, telex or telecopy (if telephonic, to be confirmed in writing
within one Business Day) notice of the receipt of notice from Chemical hereunder
to each of the Banks.
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(b) Subject to the provisions of Section 6 hereof, the proceeds of
each Borrowing of Revolving Credit Loans and of each Swingline Loan shall be
made available to the relevant Borrower at the principal office of the
Administrative Agent in Chicago, Illinois, by depositing immediately available
funds into an account maintained by such Borrower with the Administrative Agent,
on the date such Borrowing is requested to be made, except to the extent such
Borrowing represents (i) a refinancing of a Reimbursement Obligation, in which
case the proceeds of such Borrowing shall be applied to the payment of the
relevant unpaid Reimbursement Obligation, or (ii) a refunding loan, in which
case the proceeds of such Borrowing shall be applied to the payment of the
relevant Swingline Loans pursuant to Section 1.2(b) hereof. Not later than 3:00
p.m. Chicago time, on the date specified for any Borrowing of Revolving Credit
Loans to be made hereunder, each Bank shall make its Loan comprising part of
such Borrowing available to the Borrowers in immediately available funds at the
principal office of the Administrative Agent, except as otherwise provided above
with respect to paying any outstanding Reimbursement Obligation or Swingline
Loan.
(c) Unless the Administrative Agent shall have been notified by a Bank
prior to the date of a Revolving Credit Loan to be made by such Bank (which
notice shall be effective upon receipt) that such Bank does not intend to make
the proceeds of such Revolving Credit Loan available to the Administrative
Agent, the Administrative Agent may assume that such Bank has made such proceeds
available to the Administrative Agent on such date and the Administrative Agent
may in reliance upon such assumption (but shall not be required to) make
available to the relevant Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Administrative Agent
by such Bank, the Administrative Agent shall be entitled to receive such amount
on demand from such Bank (or, if such Bank fails to pay such amount forthwith
upon such demand, to recover such amount, together with interest thereon at the
rate otherwise applicable thereto under Section 1.3 hereof, from the relevant
Borrower) together with interest thereon in respect of each day during the
period commencing on the date such amount was made available to a Borrower and
ending on the date the Administrative Agent recovers such amount, at a rate per
annum equal to the effective rate charged to the Administrative Agent for
overnight Federal funds transactions with member banks of the Federal Reserve
System for each day, as determined by the Administrative Agent (or, in the case
of a day which is not a Business Day, then for the preceding Business Day) (the
"Fed Funds Rate"). Nothing in this Section 1.7(c) shall be deemed to permit any
Bank to breach its obligations to make Revolving Credit Loans under the
Revolving Credit, or to limit any Borrower's claims against any Bank for such
breach.
Section 1.8. Participation in L/Cs. (a) Each of the Banks will
acquire, without recourse, representation or warranty, a risk participation in
each L/C upon the issuance thereof ratably in accordance with its Commitment
Percentage. In the event any Reimbursement Obligation is not immediately paid
by the Borrowers pursuant to Section 1.6 hereof, each Bank will pay to Harris
funds in an amount equal to such Bank's Commitment Percentage of the unpaid
amount of such Reimbursement Obligation. If the Banks fund Harris with respect
to any Reimbursement Obligation that is not paid when due by the Borrowers as
described above, all of the Banks may elect to treat such funding as additional
Revolving Credit Loans to the Borrowers hereunder rather than a purchase of
participations by the Banks in the related L/Cs held by
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Harris. The obligation of the Banks to Harris under this Section 1.8 shall be
absolute and unconditional and shall not be affected or impaired by any Event of
Default or Potential Default which may then be continuing hereunder. Harris
shall notify each Bank by telephone of its Commitment Percentage of such unpaid
Reimbursement Obligation. If such notice has been given to each Bank by 12:00
Noon, Chicago time, each Bank agrees to put Harris in immediately available and
freely transferable funds on the same Business Day. Funds shall be so made
available at the account designated by Harris in such notice to the Banks. Upon
the election by the Banks to treat such funding as additional Revolving Credit
Loans hereunder and payment by each Bank, such Loans shall bear interest in
accordance with Section 1.3(a) hereof. Harris shall share with each Bank its
Commitment Percentage of each payment of a Reimbursement Obligation (whether of
principal or interest) and any L/C Participation Fee payable by the Borrowers.
Any such amount shall be promptly remitted to the Banks when and as received by
Harris from the Borrowers. The L/C Issuance Fee and L/C Administration Fee shall
be solely for Harris' account and shall not be shared by the other Banks.
(b) The Banks shall, ratably in accordance with their respective
Commitment Percentages, indemnify Harris (to the extent not reimbursed by the
Borrowers) against any cost, expense (including reasonable counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from Harris' gross negligence or willful misconduct) that Harris may suffer or
incur in connection with any L/C. The obligations of the Banks under this
Section 1.8(b) and all other parts of this Section 1.8 shall survive termination
of this Agreement and of all L/C Agreements, and all drafts or other documents
presented in connection with drawings thereunder.
Section 1.9. Capital Adequacy. If, after the date hereof, any Bank
or the Administrative Agent shall have determined in good faith that the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change therein (including, without limitation, any revision in the Final
Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve
System (12 CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of the
Office of the Comptroller of the Currency (12 CFR Part 3, Appendix A), or in any
other applicable capital rules heretofore adopted and issued by any governmental
authority), or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Bank's capital, or on the capital of any corporation controlling such
Bank, in each case as a consequence of its obligations hereunder, to a level
below that which such Bank would have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time if such Bank is generally imposing payments for such reduction on
its similarly situated customers, within thirty (30) days after demand by such
Bank (with a copy to the Administrative Agent), the Borrowers shall pay to such
Bank such additional amount or amounts as will compensate such Bank for such
reduction.
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Section 1.10. Absolute Obligations. Each Borrower acknowledges and agrees
that its joint and several liability on the Notes, Reimbursement Obligations and
on all obligations owed by any Borrower or Borrowers under this Agreement is
absolute and unconditional and shall not in any manner be affected or impaired
by any acts or omissions whatsoever by the Banks, and without limiting the
generality of the foregoing, each Borrower's joint and several liability on the
Notes, Reimbursement Obligations and under this Agreement shall not be impaired
by any acceptance by the Banks of any other security for or guarantors upon the
Notes, Reimbursement Obligations or any obligations under this Agreement or by
any failure, neglect or omission on the Banks' part to resort to any one or all
of the Borrowers for payment of the Notes, Reimbursement Obligations or the
obligations under this Agreement or to realize upon or protect any collateral
security therefor. Each Borrower's joint and several liability on the Notes,
Reimbursement Obligations and under this Agreement shall not in any manner be
impaired or affected by who receives or uses the proceeds of the loans evidenced
by the Notes, Reimbursement Obligations or for what purposes such proceeds are
used, and each Borrower waives notice of borrowing requests issued by, and loans
made to, other Borrowers. Such joint and several liability of each Borrower
shall also not be impaired or affected by (and each Bank, without notice to
anyone, is hereby authorized to make from time to time) any sale, pledge,
surrender, compromise, settlement, release, renewal, extension, indulgence,
alteration, substitution, exchange, change in, modification or disposition of
any collateral security for the Notes, Reimbursement Obligations or the
obligations under this Agreement or of any guaranty thereof. In order to enforce
payment of the Notes, Reimbursement Obligations and the Borrowers' obligations
under this Agreement, foreclose or otherwise realize on any collateral security
therefor, and to exercise the rights granted to any Agent hereunder and
thereunder and under applicable law, the Agents shall be under no obligation at
any time to first resort to any collateral security, property, liens or any
other rights or remedies whatsoever, and the Banks shall have the right to
enforce the Notes, Reimbursement Obligations and the Borrowers' obligations
under this Agreement irrespective of whether or not other proceedings or steps
are pending seeking resort to or realization upon or from any of the foregoing.
By its acceptance below, each Borrower hereby expressly waives and surrenders
any defense to its joint and several liability on the Notes, Reimbursement
Obligations or under this Agreement based upon any of the foregoing. In
furtherance thereof, each Borrower agrees that wherever in this Agreement it is
provided that a Borrower is liable for a payment such obligation is the joint
and several obligation of each Borrower.
SECTION 2. THE BID FACILITY.
Section 2.1. The Bid Loans. At any time before the Termination Date,
Chemical may request the Banks to offer to make uncommitted loans (each such
loan being hereinafter referred to as a "Bid Loan" and collectively as the "Bid
Loans") in the manner set forth in Sections 2.1 through 2.6 hereof and in
amounts such that the aggregate principal amount of the Total Outstandings
hereunder shall not exceed the sum of the Revolving Credit Commitments then in
effect after taking into account any Loans to be paid with such Bid Loans. The
Banks may, but shall have no obligation to, make such offers and the Borrowers
may, but shall have no obligation to, accept any such offers in the manner set
forth in Sections 2.1 through 2.6 hereof. Each Bank may offer to make Bid Loans
in any amount (whether greater than, equal to, or less than its Revolving Credit
Commitment), subject to the limitation that the aggregate principal
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amount of the Total Outstandings under this Agreement may not at any time exceed
the sum of the Revolving Credit Commitments then in effect. Bid Loans may either
bear interest at a stated rate per annum ("Stated Rate Bid Loans") or at a
margin (the "Bid Margin") over or under the Adjusted Eurodollar Rate
("Eurodollar Bid Loans"); provided that there may be no more than five different
Interest Periods for Bid Loans outstanding at the same time and that no Bid Loan
may mature after the Termination Date.
Section 2.2. Requests for Bid Loan.
(a) Requests and Confirmations. In order to request a Borrowing of
Bid Loans (a "Bid Loan Request") Chemical shall give telephonic, telex or
telecopy notice to the Administrative Agent by no later than 1:00 p.m. (Chicago
time) on the date at least one Business Day in the case of Stated Rate Bid
Loans, and three Business Days in the case of Eurodollar Bid Loans, before the
date of the requested Bid Borrowing (the "Borrowing Date"). Each such request
shall be followed on the same day by a duly completed Bid Loan Request
Confirmation, delivered by telecopier or other means of facsimile communication,
substantially in the form of Exhibit C hereto or otherwise containing the
information required by this Section, to be received by the Administrative Agent
no later than 1:30 p.m. (Chicago time). Bid Loan Request Confirmations that do
not conform substantially to the format of Exhibit C may be rejected by the
Administrative Agent, and the Administrative Agent shall give telephonic notice
to Chemical of such rejection promptly after it determines that the Bid Loan
Request Confirmation does not substantially conform to the format of Exhibit C.
Bid Loan Requests shall in each case refer to this Agreement and specify (i) the
proposed Borrowing Date (which must be a Business Day), (ii) the aggregate
principal amount thereof (which shall not be less than $5,000,000 and thereafter
in integral multiples of $1,000,000) and (iii) the proposed Interest Period
thereof.
(b) Invitation to Bid. Upon receipt by the Administrative Agent of a
Bid Loan Request Confirmation that conforms substantially to the format of
Exhibit C hereto or is otherwise acceptable to the Administrative Agent, the
Administrative Agent shall, by telephone, promptly confirmed by a telecopy or
other form of facsimile communication in the form of Exhibit D hereto, invite
each Bank to bid, on the terms and conditions of this Agreement, to make Bid
Loans pursuant to the Bid Loan Request no later than 3:00 p.m. (Chicago time) on
the date the Administrative Agent receives such Bid Loan Request.
(c) Bids. Each Bank may, in its sole discretion, offer to make a Bid
Loan or Bid Loans (a "Bid") to the applicable Borrower responsive to the Bid
Loan Request. Each Bid by a Bank must be received by the Administrative Agent
by telephone not later than 8:45 a.m. (Chicago time) on the Business Day
following the date the Administrative Agent receives a Bid Loan Request from
Chemical (the "Auction Date"), promptly confirmed in writing by a duly completed
Confirmation of Bid delivered by telecopier or other means of facsimile
communication substantially in the form of Exhibit E hereto, to be received by
the Administrative Agent on the same day; provided, however, that any Bid made
by the Administrative Agent must be made by telephone to Chemical by no later
than fifteen minutes prior to the time that Bids from the other Banks are
required to be received. Each Bid and each Confirmation of Bid shall refer to
this Agreement and specify (i) the principal amount of each
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Bid Loan that the Bank is willing to make to the Borrower and the type of Bid
Loan (i.e., Stated Rate or Eurodollar), (ii) the interest rate (which shall be
computed on the basis of a 360-day year and actual days elapsed and, in the case
of a Eurodollar Bid Loan, shall be expressed in terms of the Bid Margin to be
added to or subtracted from the Adjusted Eurodollar Rate for the Interest Period
to be applicable to such Eurodollar Bid Loan) at which the Bank is prepared to
make each Bid Loan and (iii) the Interest Period applicable thereto. The
Administrative Agent shall reject any Bid if such Bid (i) does not specify all
of the information specified in the immediately preceding sentence, (ii)
contains any qualifying, conditional, or similar language, (iii) proposes terms
other than or in addition to those set forth in the Bid Loan Request to which it
responds, or (iv) is received by the Administrative Agent later than the times
provided for above. Any Bid submitted by a Bank pursuant to this Section 2.2
shall be irrevocable and shall be promptly confirmed by a telecopy or other form
of facsimile communication in the form of Exhibit E, provided that in all events
the telephone Bid received by the Administrative Agent shall be binding on the
relevant Bank and shall not be altered, modified, or in any other manner
affected by any inconsistent terms contained in, or terms missing from, the
Bank's Confirmation of Bid. Each offer contained in a Bid to make a Bid Loan in
a certain amount, at a certain interest rate, and for a certain Interest Period
is referred to herein as an "Offer".
Section 2.3. Notice of Bids; Advice of Rate. The Administrative
Agent shall give telephonic notice to Chemical of the number of Bids made, the
terms of the Offers contained in such Bids (including the interest rate(s) and
Interest Period(s) applicable to each Bid, the maximum principal amount bid at
each interest rate for each Interest Period, and the identity of the Bank making
such Bid), such notice to be given by 9:15 a.m. (Chicago time) on the Auction
Date. The Administrative Agent shall send a written summary of all Bids
received by it to Chemical by 2:00 p.m. (Chicago time) on the same day. The
interest rates quoted for Eurodollar Bid Loans shall be expressed in terms of
the Bid Margin to be added to or subtracted from the Adjusted Eurodollar Rate to
be applicable to such Bid Loan.
Section 2.4. Acceptance or Rejection of Bids. Chemical may in its
sole and absolute discretion, subject only to the provisions of this Section,
irrevocably accept or reject any Offer contained in a Bid. No later than the
later of 9:45 a.m. (Chicago time) or 30 minutes after receipt of telephonic
notice of bids on the Auction Date, Chemical shall give telephonic notice to the
Administrative Agent of whether and to what extent it has decided to accept or
reject any or all of the Offers contained in the Bids made in response to the
related Bid Loan Request, which notice shall be promptly confirmed by telecopier
or other form of facsimile communication to be received by the Administrative
Agent on the proposed Borrowing Date; provided, however, that (a) Chemical shall
accept Offers for any of the maturities specified by Chemical in the related Bid
Loan Request Confirmation solely on the basis of ascending interest rates for
each such Interest Period for each Stated Rate Bid Loan or Eurodollar Bid Loan
as the case may be for such Interest Period, (b) if Chemical declines to borrow,
or if it is restricted by any other condition hereof from borrowing, the maximum
principal amount of Bid Loans in respect of which Offers at a particular
interest rate for a particular Interest Period have been made, then Chemical
shall accept a pro rata portion of each such Offer, based as nearly as possible
on the ratio of the maximum aggregate principal amounts of Bid Loans for which
each such Offer was made by each Bank (provided that, if the available principal
amount of Bid Loans to be so allocated is not
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<PAGE>
sufficient to enable Bid Loans to be so allocated to each relevant Bank in
integral multiples of $1,000,000, then Chemical may round allocations up or down
in integral multiples not less than $100,000 as it shall deem appropriate), (c)
the aggregate principal amount of all Offers accepted by Chemical shall not
exceed the maximum amount contained in the related Bid Loan Request
Confirmation, and (d) no Offer of a Bid Loan shall be accepted in a principal
amount less than $1,000,000 and thereafter in integral multiples of $500,000
(provided that such Offer may be rounded up or down as provided for in (b)
above). Any telephone notice given by Chemical pursuant to this Section shall be
irrevocable and shall not be altered, modified, or in any other manner affected
by any inconsistent terms contained in, or terms missing from, any written
confirmation of such notice.
Section 2.5. Notice of Acceptance or Rejection of Bids.
(a) Notice to Banks Making Successful Bids. The Administrative Agent
shall give telephonic notice to each Bank if any of the Offers contained in its
Bid have been accepted (including the amount, the applicable interest rate and
Interest Period for each accepted Offer) no later than 10:15 a.m. (Chicago time)
on the Auction Date, and each successful bidder will thereupon become bound,
subject to Section 6 and the other applicable conditions hereof, to make the Bid
Loan(s) in respect of which its Offer has been accepted. As soon as practicable
thereafter the Administrative Agent shall send a Notice of Acceptance of Bid
substantially in the form of Exhibit F hereto to each such successful bidder;
provided, however, that failure to give such Notice of Acceptance shall not
affect the obligation of such successful bidder to disburse its Bid Loans as
herein required.
(b) Notice to all Banks. As soon as practicable after each Borrowing
Date for Bid Loans, the Administrative Agent shall notify each Bank (whether or
not its Bid or its Bids were successful) of the aggregate amount of Bid Loans
advanced pursuant to the relevant Bid Loan Request on such Borrowing Date, the
maturities thereof, and the lowest and highest interest rates at which Bid Loans
were made for each maturity.
(c) Disbursement of Bid Loans. Not later than 1:30 p.m. (Chicago
time) on the Borrowing Date for each Borrowing of a Bid Loan(s), each Bank bound
to make a Bid Loan(s) in accordance with Section 2.5(a) shall, subject to
Section 6 and the other applicable conditions hereof, make available to the
Administrative Agent the principal amount of each such Bid Loan in immediately
available funds at the Administrative Agent's principal office in Chicago,
Illinois. The Administrative Agent shall promptly thereafter make available to
the Borrower like funds as received from each Bank, at such office of the
Administrative Agent in Chicago, Illinois.
(d) Interest on Bid Loans. Each Borrower, jointly and severally,
shall pay interest on the unpaid principal amount of each Bid Loan from the
applicable Borrowing Date to the maturity thereof at the rate of interest
applicable to such Bid Loan as determined pursuant to the above provisions
(calculated on the basis of a 360 day year and the actual number of days
elapsed) payable on the last day of the Interest Period applicable to such Bid
Loan and at maturity (whether by acceleration or otherwise), and, if the
applicable Interest Period is longer than 90 days, on each day occurring every
90 days after the date such Loan is made.
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<PAGE>
Section 2.6. Telephonic Notice. Each Bank's telephonic notice to the
Administrative Agent of its Bid pursuant to Section 2.2(c) hereof, and
Chemical's telephonic acceptance of any Offer contained in a Bid pursuant to
Section 2.4 hereof, shall be irrevocable and binding on such Bank and the
applicable Borrower and shall not be altered, modified, or in any other manner
affected by any inconsistent terms contained in, or missing from, any telecopy
or other confirmation of such telephonic notice. It is understood and agreed by
the parties hereto that the Administrative Agent shall be entitled to act (or to
fail to act) hereunder in reasonable reliance on its records of any telephonic
notices provided for herein and that the Administrative Agent shall not incur
any liability to any Person in so doing if its records conflict with any
telecopy or other confirmation of a telephone notice or otherwise, provided that
the Administrative Agent has acted (or failed to act) in good faith. It is
further understood and agreed by the parties hereto that the times of day as set
forth in this Section 2.6 are for the convenience of all the parties for
providing notices and that no party shall incur any liability or other
responsibility for any failure to provide such notices within the specified
times; provided, however, that the Administrative Agent shall have no obligation
to notify Chemical of any Bid received by it later than 8:45 a.m. (Chicago time)
on the Auction Date, and no acceptance by Chemical of any Offer contained in
such a Bid shall be effective to bind any Bank to make a Bid Loan, nor shall the
Administrative Agent be under any obligation to notify any Person of an
acceptance, if notice of such acceptance is received by the Administrative Agent
later than the later of 9:45 a.m. (Chicago time) or 30 minutes after receipt of
telephonic notice of bids on the Auction Date.
SECTION 3. THE NOTES, FEES, PREPAYMENTS, TERMINATIONS AND
APPLICATION OF PAYMENTS.
Section 3.1. The Notes. All Loans made by each Bank to the Borrowers
hereunder shall be evidenced by a single Revolving Credit Note of the Borrowers,
jointly and severally, substantially in the form of Exhibit A hereto
(individually, a "Revolving Note" or "Note" and together, the "Revolving Notes"
or "Notes") payable to the order of such Bank, but the aggregate principal
amount of indebtedness evidenced by such Revolving Note at any time shall be,
and the same is to be determined by, the aggregate principal amount of all Loans
made by such Bank to the Borrowers pursuant hereto on or prior to the date of
determination less the aggregate amount of principal repayments on such Loans
received by or on behalf of such Bank on or prior to such date of determination.
Each Revolving Note shall be dated as of the execution date of this Agreement,
shall be delivered concurrently herewith, and shall be expressed to mature on
the Termination Date and to bear interest as provided in Sections 1.2, 1.3 and 2
hereof. Each Bank shall record on its books or records or on a schedule to its
Revolving Note the amount of each Loan made by it hereunder and all payments of
principal and interest and the principal balance from time to time outstanding,
provided that prior to any transfer of such Revolving Note all such amounts
shall be recorded on a schedule to such Revolving Note. The record thereof,
whether shown on such books or records or on a schedule to the Revolving Note,
shall be prima facie evidence as to all such amounts; provided, however, that
the failure of any Bank to record any of the foregoing shall not limit or
otherwise affect the joint and several obligation of the Borrowers to repay all
Loans made hereunder together with accrued interest thereon. Upon the request
of any Bank, the Borrowers will furnish a new Revolving Note to such Bank to
replace
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<PAGE>
its outstanding Revolving Note and at such time the first notation appearing on
the schedule on the reverse side of, or attached to, such Revolving Note shall
set forth the aggregate unpaid principal amount of all Loans then outstanding
from such Bank. Such Bank will cancel the outstanding Revolving Credit Note upon
receipt of the new Revolving Note.
Section 3.2. Facility Fee. For the period from the date hereof to
and including the Termination Date, or such earlier date on which the Revolving
Credit is terminated in whole pursuant to Section 3.5 hereof, the Borrowers,
jointly and severally, shall pay to the Administrative Agent for the account of
the Banks a facility fee with respect to the Revolving Credit at the rate per
annum (computed on a basis of a year of 365/366 days for the actual number of
days elapsed) equal to the Applicable Margin in effect from time to time of the
maximum amount of the Revolving Credit Commitments, calculated without regard to
whether any credit is available or outstanding under the Revolving Credit
(determined in each case after giving effect to any reductions thereof as
specified in Section 3.5 hereof). Such fee shall be payable quarterly in
arrears on the last day of each March, June, September and December commencing
on the last day of December, 1996, and on the Termination Date, unless the
Revolving Credit is terminated in whole on an earlier date, in which event the
fees for the period from the date of the last payment made pursuant to this
Section 3.2 through the effective date of such termination in whole shall be
paid on the date of such earlier termination in whole.
Section 3.3. Agent's Fees. The Borrowers shall pay to and for the
sole account of the appropriate Agent such fees as the Borrowers and such Agent
may agree upon in writing from time to time. Such fees shall be in addition to
any fees and charges the Agents may be entitled to receive under the other Loan
Documents.
Section 3.4. (a) Optional Prepayments of Base Rate Loans. The
Borrowers shall have the privilege of prepaying without premium or penalty and
in whole or in part (but if in part, then in a minimum principal amount of
$5,000,000 or such greater amount which is an integral multiple of $1,000,000)
any Borrowing of Base Rate Loans at any time upon prior telecopy or telephonic
notice from Chemical to the Administrative Agent on or before 11:00 a.m.
(Chicago time) on the Business Day of such prepayment. Any amount prepaid under
the Revolving Credit may, subject to the terms and conditions of this Agreement,
be borrowed, repaid and borrowed again.
(b) Optional Prepayments of Swingline Loans. The Borrowers may prepay
any borrowing of Swingline Loans, upon telephonic notice (which shall be
promptly confirmed in writing by facsimile communication, telex or telegraph) by
no later than 11:00 a.m. (Chicago time) on the date of such prepayment from
Chemical to the Administrative Agent, such prepayment to be made by the payment
of the principal amount to be prepaid and accrued interest thereon and any
compensation required by Section 9.4 hereof, if applicable; provided, however,
that any such prepayment shall be in a principal amount of no less than $250,000
or such greater amount which is an integral multiple of $100,000, and after
giving effect to any such prepayment the outstanding principal amount of any
such borrowing of Swingline Loans prepaid in part shall not be less than
$250,000 or such greater amount which is an integral multiple of $100,000.
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<PAGE>
(c) Optional Prepayments of Eurodollar Loans. The Borrowers may
prepay any borrowing of Eurodollar Loans, upon telephonic notice (which shall be
promptly confirmed in writing by facsimile communication, telex or telegraph) by
no later than 11:00 a.m. (Chicago time) on the date of such prepayment from
Chemical to the Administrative Agent, such prepayment to be made by the payment
of the principal amount to be prepaid and accrued interest thereon and any
compensation required by Section 9.4 hereof, if applicable; provided, however,
that any such prepayment shall be in a principal amount of no less than
$10,000,000 or such greater amount which is an integral multiple of $1,000,000,
and after giving effect to any such prepayment the outstanding principal amount
of any such borrowing of Eurodollar Loans prepaid in part shall not be less than
$10,000,000 or such greater amount which is an integral multiple of $1,000,000.
(d) Mandatory Prepayments of Excess Borrowings. If at any time the
Total Outstandings hereunder shall exceed the Revolving Credit Commitments, the
Borrowers shall immediately prepay Loans and Reimbursement Obligations
outstanding for each Borrower's account and, if necessary, pledge cash
collateral to the Administrative Agent to secure outstanding L/Cs issued for
such Borrower's account, in an amount equal to such excess.
Section 3.5. Revolving Credit Termination. The Borrowers shall have
the right at any time upon 5 days' prior notice to the Banks to terminate the
Revolving Credit in whole or in part (but if in part in a minimum principal
amount of $10,0000,000 or such greater amount which is an integral multiple of
$5,000,000); provided, however, that the Borrowers may not terminate any portion
of the Revolving Credit which represents outstanding Revolving Credit
Obligations unless the Borrowers contemporaneously prepay the same or, with
respect to any outstanding L/Cs, pledge cash collateral to the Administrative
Agent to secure the same.
Section 3.6. Place and Application of Payments. All payments by the
Borrowers hereunder shall be made to the Administrative Agent at its office at
111 West Monroe Street, Chicago, Illinois 60690 and in immediately available
funds, prior to 12:00 noon on the date of such payment. All such payments shall
be made without setoff or counterclaim and without reduction for, and free from,
any and all present and future levies, imposts, duties, fees, charges,
deductions withholdings, restrictions or conditions of any nature imposed by any
government or any political subdivision or taxing authority thereof. Any
payments received after 12:00 noon Chicago time (or after any later time the
Banks may otherwise direct) shall be deemed received upon the following Business
Day. The Administrative Agent shall remit to each Bank its proportionate share
of each payment of principal, interest and facility fees received by the
Administrative Agent by 3:00 P.M. Chicago time on the same day of its receipt
and its proportionate share of each such payment received by the Administrative
Agent after 12:00 noon on the Business Day following its receipt by the
Administrative Agent. In the event the Administrative Agent does not remit any
amount to any Bank when required by the preceding sentence, the Administrative
Agent shall pay to such Bank interest on such amount until paid at a rate per
annum equal to the Fed Funds Rate. Each Borrower hereby authorizes the
Administrative Agent to automatically debit its designated account with Harris
for any principal, interest and fees when due under the Notes, any L/C
Agreements or this Agreement and to
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transfer the amount so debited from such account to the Administrative Agent for
application as herein provided.
Section 3.7. Closing Fee. The Company shall pay to the
Administrative Agent for the ratable account of the Banks a closing fee in an
amount equal to 0.025% of the aggregate amount of all of the Revolving Credit
Commitments, payable upon the execution and delivery of this Agreement.
Section 4. Definitions;.
Section 4.1. Certain Definitions. The terms hereinafter set forth
when used herein shall have the following meanings:
"Acquisition" shall mean the acquisition of First Mississippi by
Chemical pursuant to the terms and conditions of the Acquisition Documents
through the merger after the Spin-Off of MISS SUB, INC., a wholly owned
subsidiary of Chemical, with and into First Mississippi.
"Acquisition Documents" shall mean the First Mississippi Purchase
Agreement, the Agreement and Plan of Distribution (the "Distribution Agreement")
dated as of December 18, 1996 by and between First Mississippi and ChemFirst
Inc. ("ChemFirst"), a wholly owned Subsidiary of First Mississippi, the Tax
Disaffiliation Agreement dated as of December 18, 1996 by and between First
Mississippi and ChemFirst, and the Employee Benefits and Compensation Agreement
dated as of December 18, 1996 by and between First Mississippi and ChemFirst.
"Adjusted Eurodollar Rate" means a rate per annum determined pursuant
to the following formula:
Adjusted Eurodollar Rate = Eurodollar Rate
-----------------------------------
100% - Reserve Percentage
"Administrative Agent" shall have the meaning specified in the first
paragraph of this Agreement.
"Affiliate" shall mean, for any Person, any other Person (including
all directors and officers of such Person) that directly or indirectly controls,
or is under common control with, or is controlled by, such Person. As used in
this definition, "control" means the power, directly or indirectly, to direct or
cause the direction of management or policies of a Person (through ownership of
voting securities, by contract or otherwise), provided that, in any event for
purposes of the definition any Person that owns directly or indirectly 10% or
more of the securities having ordinary voting power for the election of
directors of a corporation or 10% or more of the partnership or other ownership
interests of any other Person will be deemed to control such corporation or
other Person.
"Agents" shall mean the Administrative Agent and the Syndication Agent.
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<PAGE>
"Agreement" shall mean this Credit Agreement as supplemented and amended
from time to time.
"Annualized Average EBIT" shall mean with reference to any fiscal
quarter, an amount equal to the Relevant Parties' EBIT, each calculated on a
consolidated basis in accordance with generally accepted accounting principles,
for the eight consecutive fiscal quarters ending with such fiscal quarter
divided by two.
"Annualized Interest Expense" shall mean:
(a) with reference to any period ending from and including the date
hereof to and including September 30, 1997, an amount equal to the Interest
Expense of Chemical and its Subsidiaries, determined in accordance with
generally accepted accounting principles, consistently applied, for the period
from and including the date hereof to and including the last day of such period
multiplied by a fraction, the numerator of which is 365 and the denominator of
which is the number of those days in such period including and following the
date hereof; and
(b) with reference to any fiscal quarter ending after September 30,
1997, an amount equal to the Interest Expense of Chemical and its Subsidiaries,
determined in accordance with generally accepted accounting principles,
consistently applied, for the four consecutive fiscal quarters then ended.
"Applicable Margin" shall mean, with respect to the Facility Fee and
each type of Loan described below, the rate of interest per annum shown below
for the range of Pricing Ratio specified below:
<TABLE>
<CAPTION>
Level I Level II Level III Level IV Level V
<S> <C> <C> <C> <C> <C>
Pricing (less than) 0.75x (greater than (greater than (greater than (greater than) 3.00x
Ratio or equal to) 0.75x and or equal to) 1.50x and or equal to) 2.25x and
(less than) 1.50x (less than) 2.25x (less than or
equal to) 3.00x
Fed Funds Rate .15% .25% .475% .675% 1.00%
Loans
Base Rate Loans 0% 0% 0% 0% .25%
Eurodollar Loans .15% .25% .475% .675% 1.00%
Facility Fee .10% .12% .15% .20% .25%
</TABLE>
The Applicable Margins will be adjusted upon receipt of Chemical's quarterly
Compliance Certificate or Pricing Ratio Certificate for the fiscal quarter ended
December 31, 1996 and at the close of every fiscal quarter thereafter. Not
later than 5 Business Days after receipt by the Administrative Agent of the
certificates called for by Section 7.4(c) or (f) hereof for each fiscal quarter,
the Administrative Agent shall determine the Pricing Ratio for the applicable
period and shall promptly notify Chemical and the Banks of such determination
and of any change in the Applicable Margins resulting therefrom. Any such
change in the Applicable Margins shall be effective as of the forty-fifth (45th)
day following the close of each fiscal quarter with respect to all Revolving
Credit Loans and Swingline Loans outstanding on such date, and such new
Applicable Margins shall continue in effect until the forty-fifth (45th) day
following the close of the next succeeding fiscal quarter. Each determination
of the Pricing Ratio and Applicable
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Margins by the Administrative Agent in accordance with this Section shall be
conclusive and binding on the Borrowers and the Banks absent manifest error.
From the date hereof until the Applicable Margins are first adjusted pursuant
hereto, the Applicable Margins shall be those set forth in Level II above.
"Bank" and "Banks" shall have the meanings specified in the first
paragraph of this Agreement.
"Base Rate" means for any day the rate of interest announced by Harris
from time to time as its prime commercial rate in effect on such day, with any
change in the Base Rate resulting from a change in said prime commercial rate to
be effective as of the date of the relevant change in said prime commercial rate
(the "Harris Prime Rate"), provided that if the rate per annum determined by
adding 1/2 of 1% to the rate at which Harris would offer to sell federal funds
in the interbank market on or about 10:00 A.M. (Chicago time) on any day (the
"Adjusted Fed Funds Rate") shall be higher than the Harris Prime Rate on such
day, then the Base Rate for such day and for the succeeding day which is not a
Business Day shall be such Adjusted Fed Funds Rate. The determination of the
Adjusted Fed Funds Rate by the Administrative Agent shall be final and
conclusive provided it has acted in good faith in connection therewith.
"Base Rate Loan" shall mean a Revolving Credit Loan which bears
interest as provided in Section 1.3(a) hereof.
"Bid Loan" shall have the meaning specified in Section 2.1 hereof.
"Borrower" and "Borrowers" shall have the meaning specified in the
first paragraph of this Agreement.
"Borrowing" means the total of Loans (other than Swingline Loans) of a
single type made by the Banks to any Borrower on a single date and for a single
Interest Period. Borrowings of Revolving Credit Loans are made ratably from the
Banks according to their Revolving Credit Commitments. Borrowings of a Bid Loan
or Bid Loans are made from a Bank or Banks in accordance with the procedures of
Section 2 hereof.
"Business Day" shall mean any day except Saturday or Sunday on which
banks are open for business in Chicago, Illinois, and, with respect to
Eurodollar Loans and Eurodollar Bid Loans, dealing in United States dollar
deposits in London, England and Nassau, Bahamas.
"Capitalized Lease" shall mean any lease or obligation for rentals
which is required to be capitalized on a consolidated balance sheet of a Person
and its Subsidiaries in accordance with generally accepted accounting
principles, consistently applied.
"Capitalized Lease Obligation" shall mean the present discounted value
of the rental obligations under any Capitalized Lease.
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"Change of Control" shall mean the occurrence, after the date hereof,
of (i) any Person or two or more Persons acting in concert acquiring beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of securities of Chemical (or other securities convertible into such
securities) representing more than 20% of the combined voting power of all
securities of Chemical entitled to vote in the election of directors; or
(ii) commencing after the date hereof, individuals who as of the date hereof
were directors of Chemical ceasing for any reason to constitute a majority of
the Board of Directors of Chemical unless the Persons replacing such individuals
were nominated by the Board of Directors of Chemical; or (iii) any Person or two
or more Persons acting in concert acquiring by contract or otherwise, or
entering into a contract or arrangement which upon consummation will result in
its or their acquisition of, or control over, securities of Chemical (or other
securities convertible into such securities) representing more than 20% of the
combined voting power of all securities of Chemical entitled to vote in the
election of directors.
"Chemical Guaranty" shall mean the Guaranty Agreement of even date
herewith from the Borrowers, as guarantors thereunder, to the lenders under the
First Mississippi Credit Agreement pursuant to which the Borrowers guaranty the
payment when due of the Guarantors' indebtedness, obligations and liabilities
under the First Mississippi Credit Agreement and related documents.
"Commitment Percentage" shall have the meaning set forth in
Section 1.1(b) hereof.
"Compliance Certificate" shall mean a Compliance Certificate in the
form of Exhibit H attached hereto.
"Debt" of any Person shall mean as of any time the same is to be
determined, the aggregate (without duplication) of:
(a) all indebtedness, obligations and liabilities with respect to
borrowed money;
(b) all guaranties, endorsements (other than any liability arising
out of the endorsement of items for deposit or collection in the ordinary course
of business) and other contingent obligations in respect of, or any obligations
to purchase or otherwise acquire, indebtedness or securities of others or to
purchase Property of others at the request or demand of any creditor of such
Person;
(c) all reimbursement and other obligations with respect to letters
of credit (whether drawn or undrawn), banker's acceptances, customer advances
and other extensions of credit whether or not representing obligations for
borrowed money;
(d) the aggregate amount of Capitalized Lease Obligations;
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(e) all indebtedness and liabilities secured by any lien or any
security interest on any Property or assets of such person, whether or not the
same would be classified as a liability on a balance sheet; and
(f) all indebtedness, obligations and liabilities representing the
deferred purchase price of Property, excluding trade payables incurred in the
ordinary course of business not more than 90 days past due;
all computed and determined on a consolidated basis for such Person and its
Subsidiaries after the elimination of intercompany items in accordance with
generally accepted accounting principles consistent with those used in the
preparation of the audit report referred to in Section 5.2 hereof.
"EBIT" means, for any Person and with reference to any period, Net
Income for such period plus all amounts deducted in arriving at such Net Income
amount in respect of (i) Interest Expense for such period, plus (ii) federal,
state and local income taxes for such period.
"EBITDA" means, for any Person and with reference to any period, Net
Income for such period plus all amounts deducted in arriving at such Net Income
amount in respect of (i) Interest Expense for such period, plus (ii) federal,
state and local income taxes for such period, plus (iii) all amounts properly
charged for depreciation of fixed assets and amortization of intangible assets
during such period on the books of such Person and its Subsidiaries.
"Environmental Laws" shall mean all federal, state and local
environmental, health and safety statutes and regulations, including without
limitation all statutes and regulations establishing quality criteria and
standards for air, water, land and toxic or hazardous wastes and substances.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Eurodollar Bid Loan" shall have the meaning specified in Section 2.1
hereof.
"Eurodollar Loan" shall mean a Revolving Credit Loan which bears
interest as provided in Section 1.3(b) hereof.
"Eurodollar Rate" shall mean for each Interest Period applicable to a
Eurodollar Loan or Eurodollar Bid Loan, (a) the LIBOR Index Rate for such
Interest Period, if such rate is available, and (b) if the LIBOR Index Rate
cannot be determined, the arithmetic average of the rates of interest per annum
(rounded upwards, if necessary, to nearest one hundred-thousandth of a
percentage point) at which deposits in U.S. dollars in immediately available
funds are offered to the Administrative Agent at 11:00 a.m. (London, England
time) two (2) Business Days before the beginning of such Interest Period by
three (3) or more major banks in the interbank eurodollar market selected by the
Administrative Agent for a period equal to such Interest Period and in an amount
equal or comparable to the principal amount of the Eurodollar Loan or Eurodollar
Bid Loan scheduled to be made by the Administrative Agent or, in the case of a
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Eurodollar Bid Loan, the applicable Bank (if other than the Administrative
Agent) during such Interest Period.
"Event of Default" shall mean any event or condition identified as
such in Section 8.1 hereof.
"Existing Agreements" shall have the meaning specified in Section 7.15
hereof.
"Existing Banks" shall have the meaning specified in Section 7.15
hereof.
"Farmland MissChem, Ltd. " means that certain Trinidad limited
liability company equally owned by Chemical and Farmland Industries, Inc. which
was formed to develop the Farmland MissChem Project.
"Farmland MissChem Project " means that certain project commenced by
Farmland MissChem, Ltd. to develop an ammonia plant in Trinidad.
"Farmland MissChem Project Contingent Obligations" means the
contingent obligations described on Exhibit K hereto.
"Fed Funds Rate" shall have the meaning specified in Section 1.7(c)
hereof. "Fed Funds Rate Loan" shall mean a Swingline Loan that bears interest as
provided in Section 1.3(c) hereof.
"First Mississippi" shall mean First Mississippi Corporation, a
Mississippi corporation. "First Mississippi Purchase Agreement" shall mean the
Agreement and Plan of Merger dated as of August 27, 1996 by and among Chemical,
MISS SUB INC. and First Mississippi.
"First Mississippi Credit Agreement" shall mean that certain Credit
Agreement dated as of even date herewith among First Mississippi and AMPRO
Fertilizer, Inc., a Louisiana corporation, the lenders party thereto, Harris, as
Administrative Agent and Bank of Montreal, as Syndication Agent, as supplemented
and amended from time to time.
"Fixed Fed Funds Rate" means with respect to each Interest Period
applicable to a Fed Funds Loan, the rate of interest per annum as determined by
the Administrative Agent at which term federal funds would be offered by the
Administrative Agent on the first day of such Interest Period to major banks in
the interbank market upon request by such major banks for a period equal to such
Interest Period and in an amount equal to the principal amount of the Fed Funds
Loan scheduled to be outstanding during such Interest Period. Each
determination of the Fed Funds Rate made by the Administrative Agent in
accordance with this paragraph shall be conclusive and binding on the Borrowers
except in the case of manifest error or willful misconduct.
"Fixed Rate Loan" shall mean any Offered Rate Loan, Eurodollar Loan,
Bid Loan or Fed Funds Rate Loan.
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"Guaranty Agreement" shall mean that certain Guaranty Agreement dated
as of even date herewith executed by the Guarantors in favor of the Banks.
"Guarantors" shall mean First Mississippi and AMPRO Fertilizer, Inc.,
a Louisiana corporation, in their capacity as guarantors under the Guaranty
Agreement.
"Harris" shall have the meaning specified in the first paragraph of
this Agreement. "Interest Coverage Ratio" shall mean (i) with reference to any
fiscal quarter of Chemical and its Subsidiaries ending during the period from
and including the date hereof to and including June 30, 1997, the ratio of
(x) Annualized Average EBIT to (y) Annualized Interest Expense for the period
from and including the date hereof to and including the date of determination
and (ii) with reference to each fiscal quarter of Chemical and its Subsidiaries
ending thereafter, the ratio of (x) Annualized Average EBIT to (y) Annualized
Interest Expense for the preceding four fiscal quarters.
"Interest Expense" shall mean, for any Person and with reference to
any period, the sum of all interest charges (including imputed interest charges
with respect to Capitalized Lease Obligations, all amortization of debt discount
and expense and all fees relating to letters of credit accrued and all net
obligations pursuant to interest rate hedging agreements) of such Person and its
Subsidiaries for such period determined on a consolidated basis in accordance
with generally accepted accounting principles, consistently applied.
"Interest Period" shall mean with respect to (a) any Eurodollar Loan,
the period used for the computation of interest commencing on the date the
relevant Eurodollar Loan is made, continued or effected by conversion and
concluding on the date one, two, three, six or twelve months thereafter as
selected by Chemical in its notice as provided herein, (b) any Eurodollar Bid
Loan, the period used for the computation of interest commencing on the date the
relevant Eurodollar Bid Loan is made, continued or effected by conversion and
concluding on the date one, two, three, four, five or six months thereafter as
selected by Chemical in its notice as provided herein, (c) any Offered Rate
Loan, the period used for the computation of interest commencing on the date of
the relevant Offered Rate Loan is made and concluding on the date 1 to 7 days
thereafter as agreed by the Administrative Agent and Chemical, (d) any Fed Funds
Rate Loan, the period used for the computation of interest commencing on the
date of the relevant Fed Funds Rate Loan and concluding on the date 1 to 7 days
thereafter as agreed by the Administrative Agent and Chemical, and (e) any
Stated Rate Bid Loan, the period commencing on, as the case may be, the
creation, continuation or conversion date with respect to such Stated Rate Bid
Loan and ending one (1) to one hundred eighty (180) days thereafter as selected
by Chemical in its notice as provided herein; provided that all of the foregoing
provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day which is
not a Business Day, that Interest Period shall be extended to
the next succeeding Business Day, unless in the case of an
Interest Period for a Eurodollar Loan or Eurodollar Bid Loan
the result of such extension would be to carry such Interest
Period into another
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calendar month in which event such Interest Period shall
end on the immediately preceding Business Day;
(ii) no Interest Period may extend beyond the Termination Date; and
(iii) the interest rate to be applicable to each Loan for each
Interest Period shall apply from and including the first day of
such Interest Period to but excluding the last day thereof.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the month
in which an Interest Period is to end, then such Interest Period shall end on
the last Business Day of such month.
"Inventory" shall mean all raw materials, work in process, finished
goods, and goods held for sale or lease or furnished or to be furnished under
contracts of service in which any Borrower or any Subsidiary now has or
hereafter acquires any right.
"L/C" shall have the meaning set forth in Section 1.5 hereof.
"L/C Agreement" shall have the meaning set forth in Section 1.5
hereof.
"L/C Administrative Fee" has the meaning specified in Section 1.5(a)
hereof.
"L/C Issuance Fee" has the meaning specified in Section 1.5(a) hereof.
"L/C Participation Fee" shall have the meaning specified in
Section 1.5(a) hereof.
"Leverage Ratio" shall mean, as of any date of determination, the
ratio of (x) the sum of all Debt of Chemical and its Subsidiaries (determined on
a consolidated basis) to (y) an amount equal to the Relevant Parties' EBITDA,
each calculated on a consolidated basis in accordance with generally accepted
accounting principles, for the eight consecutive fiscal quarters ending with
such fiscal quarter divided by two.
"LIBOR Index Rate" shall mean, for any Interest Period applicable to a
Eurodollar Loan, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of a percentage point) for deposits in U.S.
Dollars for a period equal to such Interest Period, which appears on the
Telerate Page 3750 as of 11:00 a.m. (London, England time) on the day two
Business Days before the commencement of such Interest Period.
"Loan" shall mean Revolving Credit Loans, Swingline Loans and Bid
Loans, and each of them singly, and the term "type" of Loan refers to its status
as a Fed Funds Rate Loan, an Offered Rate Loan, a Eurodollar Loan, Eurodollar
Bid Loan, a Base Rate Loan or Stated Rate Bid Loan.
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<PAGE>
"Loan Documents" shall mean this Agreement and any and all exhibits
hereto, the Notes, the L/C Agreements and the Guaranty Agreement.
"Net Income" means, for any Person and with reference to any period,
the net income of such Person and its Subsidiaries for such period determined on
a consolidated basis in accordance with generally accepted accounting
principles, consistently applied, but excluding in any event any items of
extraordinary gain or loss.
"Note" and "Notes" shall have the meanings specified in Section 3.1
hereof. "Offered Rate Loan" shall mean a Swingline Loan that bears interest as
provided in Section 1.2(a) hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean and include any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust, unincorporated
organization, association, corporation, institution, entity, party or government
(whether national, federal, state, county, city, municipal, or otherwise,
including, without limitation, any instrumentality, division, agency, body or
department thereof).
"Plan" shall mean any employee benefit plan covering any officers or
employees of a Borrower or any Subsidiary, any benefits of which are, or are
required to be, guaranteed by the PBGC.
"Potential Default" shall mean any event or condition specified in
Section 8.1 hereof which, with the lapse of time, or giving of notice, or both,
would constitute an Event of Default. "Pricing Ratio" shall mean, as of any date
or determination, the ratio of (x) the sum of all Debt of Chemical and its
Subsidiaries (determined on a consolidated basis) to (y) EBITDA of the Relevant
Parties', each determined on a consolidated basis in accordance with generally
accepted accounting principles, for the four fiscal quarters ending on such date
of determination.
"Pricing Ratio Certificate" has the meaning specified in
Section 7.4(f) hereof.
"Property" shall mean all assets and properties of any nature
whatsoever, whether real or personal, tangible or intangible, including without
limitation intellectual property.
"Reimbursement Obligations" has the meaning specified in Section 1.6
hereof.
"Relevant Parties" shall mean (a) with reference to any period prior
to the completion of the Acquisition, the Borrowers and the Guarantors, and
(b) with reference to any period after the completion of the Acquisition,
Chemical and its Subsidiaries.
"Required Banks" shall mean any Bank or Banks which in the aggregate
have more than 50% of the Revolving Credit Commitments or, if at the time no
Revolving Credit Commitments
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are in effect, any Bank or Banks which in the aggregate hold more than 50% of
the aggregate unpaid principal balance of the Loans and Reimbursement
Obligations then outstanding.
"Reserve Percentage" means the daily arithmetic average maximum rate
at which reserves (including, without limitation, any supplemental, marginal and
emergency reserves) are imposed on member banks of the Federal Reserve System
during the applicable Interest Period by the Board of Governors of the Federal
Reserve System (or any successor) under Regulation D on "eurocurrency
liabilities" (as such term is defined in Regulation D), subject to any
amendments of such reserve requirement by such Board or its successor, taking
into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be eurocurrency liabilities
as defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D. As of the date hereof, the Reserve
Percentage is zero.
"Restricted Payments" shall have the meaning specified in Section 7.8
hereof.
"Revolving Credit" shall have the meaning specified in the first
paragraph of this Agreement.
"Revolving Credit Commitment" and "Revolving Credit Commitments" shall
have the meanings specified in Section 1.1(b) hereof.
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the
meanings specified in Section 1.1(a) hereof.
"Revolving Credit Obligations" shall have the meaning specified in
Section 1.1(a) hereof.
"Revolving Note" or "Revolving Notes" shall have the meanings
specified in Section 3.1 hereof.
"Spin-Off" shall mean the spin-off of First Mississippi's chemicals
and other non-fertilizer businesses to First Mississippi's existing shareholders
by means of a pro rata dividend distribution of common stock of ChemFirst
pursuant to the terms and conditions of the Distribution Agreement.
"Subsidiary" shall mean, for any Person, any corporation or other
entity of which more than fifty percent (50%) of the outstanding stock or
comparable equity interests having ordinary voting power for the election of the
Board of Directors of such corporation or similar governing body in the case of
a non-corporation (irrespective of whether or not, at the time, stock or other
equity interests of any other class or classes of such corporation or other
entity shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned by such Person or by
one or more of its Subsidiaries and in any event the term "Subsidiary" shall
include Triad after completion of the Acquisition, but only so long as Triad
shall remain in existence.
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<PAGE>
"Syndication Agent" shall have the meaning specified in the first
paragraph of this Agreement.
"Tangible Net Worth" means, for any Person and at any time the same is
to be determined, the total shareholders' equity (including capital stock,
additional paid-in capital and retained earnings after deducting treasury stock
and excluding minority interests in Subsidiaries) which would appear on the
balance sheet of such Person and its Subsidiaries determined on a consolidated
basis in accordance with generally accepted accounting principles, consistently
applied, less the sum of the aggregate book value of all assets which would be
classified as intangible assets under generally accepted accounting principles,
consistently applied, including, without limitation, goodwill, patents,
trademarks, trade names, copyrights, franchises and deferred charges (including,
without limitation, unamortized debt discount and expense, organization costs
and deferred research and development expense, but excluding deferred taxes) and
similar assets and the write-up of assets above cost.
"Telerate Page 3750" shall mean the display designated as "Page 3750"
on the Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
"Termination Date" shall have the meaning set forth in Section 1.1(a)
hereof.
"Total Assets" shall mean, at any time the same is to be determined,
the aggregate of all items which would be listed as an asset on a balance sheet
of a Person and its Subsidiaries determined on a consolidated basis in
accordance with generally accepted accounting principles.
"Total Outstandings" shall mean the aggregate principal amount of all
Loans plus the aggregate principal amount of all unpaid Reimbursement
Obligations plus the maximum amount available to be drawn under all L/Cs
outstanding under this Agreement.
"Triad" shall mean Triad Chemical, a Mississippi general partnership.
"Triad Chemical Product Withdrawal Agreement" shall mean that certain
Products Withdrawal Agreement dated June 3, 1968 by and among First Mississippi,
MisCoa, a partnership of general partners, Chemical and Coastal Chemical
Corporation, a Mississippi corporation.
Section 4.2. Accounting Terms;. Any accounting term not otherwise
specifically defined in this Agreement shall have the meaning customarily given
to such term in accordance with generally accepted accounting principles,
consistently applied. Where the character or amount of any asset or liability
or item of income or expense is required to be determined or any consolidation
or other accounting computation is required to be made for the purpose of this
Agreement, it shall be done in accordance with generally accepted accounting
principles, to the extent applicable, except where such principles are
inconsistent with the requirements of this Agreement.
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Section 5. Representations and Warranties.
Each Borrower represents and warrants to the Banks as follows:
Section 5.1. Organization and Qualification; Non-Contravention';.
Each Borrower is duly organized, validly existing and in good standing under the
laws of the state of its incorporation, has full and adequate corporate power to
carry on its business as now conducted, is duly licensed or qualified in all
jurisdictions wherein the nature of its activities requires such licensing or
qualifying, except where the failure to be so licensed or qualified would not
result in a material adverse change in the Properties, business or operations of
Chemical and its Subsidiaries taken as a whole, has full right, power and
authority to be a party to the Acquisition, to enter into the Acquisition
Documents to which it is a party, this Agreement and the other Loan Documents to
which it is a party, to make the borrowings herein provided for, to execute and
issue its Notes in evidence thereof, and to perform each and all of the matters
and things herein and therein provided for; and the Acquisition Documents to
which it is a party, this Agreement and the other Loan Documents do not, nor
does the performance or observance by any Borrower of any of the matters or
things provided for in the Acquisition Documents and the Loan Documents,
contravene any provision of law or any charter or by-law provision or any
material covenant, indenture or agreement of or affecting such Borrower or its
Properties.
Section 5.2. Financial Reports;. Chemical has heretofore delivered
to each Bank a copy of the annual audit report as of June 30, 1996, and the
accompanying financial statements of Chemical and its Subsidiaries and unaudited
financial statements of Chemical and its Subsidiaries as of, and for the interim
period ending September 30, 1996. Such financial statements have been prepared
in accordance with generally accepted accounting principles (except for the
omission of footnotes and subject to normal year-end audit adjustments with
respect to such unaudited statements) on a basis consistent, except as otherwise
noted therein, with that of the previous fiscal year or period and fairly
reflect in all material respects the financial position of Chemical and its
Subsidiaries as of the dates thereof, and the results of its operations for the
periods covered thereby. The Borrowers and their Subsidiaries have no material
contingent liabilities other than as indicated on said financial statements and
since said date of June 30, 1996, there has been no material adverse change in
the condition, financial or otherwise, of any Borrower or any Subsidiary, except
those disclosed in writing to the Banks prior to the date of this Agreement.
Section 5.3. Litigation; Tax Returns; Approvals';. Except as
disclosed on Schedule 5.3 hereto, there is no litigation, labor controversy or
governmental proceeding pending, nor to the knowledge of any Borrower
threatened, against such Borrower or any Subsidiary which if adversely
determined would result in any material adverse change in the Properties,
business or operations of Chemical and its Subsidiaries taken as a whole. All
federal, state and local income tax returns for each Borrower and its
Subsidiaries required to be filed have been filed on a timely basis, and all
amounts required to be paid as shown by said returns have been paid. There are
no pending or, to any Borrower's knowledge, threatened objections to or
controversies in respect of the United States federal, state or local income tax
returns of any Borrower and its Subsidiaries
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for any fiscal year. No authorization, consent, license, exemption or filing or
registration with any court or governmental department, agency or
instrumentality, is or will be necessary to the valid execution, delivery or
performance by any Borrower of the Loan Documents or the Acquisition Documents
to which it is a party, except such as have been previously obtained or where
the failure to obtain such authorization, consent, license, exemption or make
such filing or registration would not result in a material adverse change in the
Properties, business or operations of Chemical and its Subsidiaries taken as a
whole.
Section 5.4. Regulation U;. Neither any Borrower nor any Subsidiary
is engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System) and no part of the proceeds of any Loan
or other extension of credit hereunder will be used to purchase or carry any
margin stock or to extend credit to others for such a purpose.
Section 5.5. No Default;. The Borrowers are in full compliance with
all of the terms and conditions of this Agreement, and no Potential Default or
Event of Default is existing under this Agreement.
Section 5.6. ERISA;. The Borrowers and their Subsidiaries are in
compliance in all material respects with ERISA to the extent applicable to it
and neither any Borrower nor any Subsidiary has received any notice to the
contrary from the PBGC or any other governmental entity or agency. No steps
have been taken to terminate any Plan, and no contribution failure has occurred
with respect to any Plan sufficient to give rise to a lien under Section 302(f)
of ERISA. No condition exists or event or transaction has occurred with respect
to any Plan which might result in the incurrence by any Borrower or any
Subsidiary of any material liability, fine or penalty. Neither any Borrower nor
any Subsidiary has any contingent liability with respect to any post-retirement
benefit under a Plan, other than liability for continuation coverage described
in Part 6 of Title I of ERISA.
Section 5.7. Debt and Security Interests;. The Borrowers and their
Subsidiaries have no Debt except Debt permitted by Section 7.10 hereof, and
there are no security interests, liens or encumbrances on any of the assets or
Property of any Borrower or any Subsidiary except for those permitted by Section
7.9 hereof.
Section 5.8. Subsidiaries and Guarantors;. The Borrowers' only
Subsidiaries are identified on Exhibit G hereof. Each of said Subsidiaries is
duly organized and validly existing under the laws of the state or country of
its incorporation, has full and adequate corporate power to carry on its
business as now conducted, and is duly licensed or qualified to do business in
all jurisdictions wherein the nature of its activities requires such licensing
or qualification, except where the failure to be so licensed or qualified would
not result in a material adverse change in the Properties, business or
operations of Chemical and its Subsidiaries taken as a whole. Each Guarantor
has full right, power and authority to execute and deliver the Loan Documents
and Acquisition Documents executed by it and to perform each and all of the
matters and things therein provided for; and the Loan Documents and Acquisition
Documents executed by it do not, nor does the performance or observance by any
Guarantor of any of the matters or things therein
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provided for, contravene any provision of law or any provision of any charter,
partnership agreement, articles of incorporation or bylaws of any Guarantor or
any material covenant, indenture or agreement of or affecting any Guarantor or
any of such Guarantor's Property.
Section 5.9. Accurate Information;. No information, exhibit or report
furnished by any Borrower or any Subsidiary to the Banks in connection with the
negotiation or performance of the Loan Documents contains any material
misstatement of fact or omitted to state a material fact or any fact necessary
to make the statements contained therein not misleading in light of the
circumstances in which made.
Section 5.10. Enforceability;. This Agreement is and the other Loan
Documents and Acquisition Documents to which each Borrower is a party are the
legal, valid and binding agreements of such Borrower, enforceable against it in
accordance with its terms, except as may be limited by (a) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other similar
laws or judicial decisions for the relief of debtors or the limitation of
creditors' rights generally; and (b) any equitable principles relating to or
limiting the rights of creditors generally or any equitable remedy which may be
granted to cure any defaults.
Section 5.11. Restrictive Agreements;. No Borrower is a party to any
contract or agreement, or subject to any charge or other corporate restriction,
which affects its ability to execute, deliver and perform the Loan Documents to
which it is a party and repay its indebtedness, obligations and liabilities
under the Loan Documents or which materially and adversely affects the financial
condition or results of operations of Chemical and its Subsidiaries taken as a
whole, or would materially and adversely affect such Borrower's legal ability to
repay the indebtedness, obligations and liabilities under the Loan Documents, or
any Bank's or the Agent's rights under the Loan Documents to which any Borrower
is a party.
Section 5.12. No Violation of Law;. Neither any Borrower nor any
Subsidiary is in violation of any law, statute, regulation, ordinance, judgment,
order or decree applicable to it which violation would materially and adversely
affect any Bank's or any Agent's rights under the Loan Documents or the
financial condition or results of operations of Chemical and its Subsidiaries
taken as a whole.
Section 5.13. No Default Under Other Agreements;. Neither any
Borrower nor any Subsidiary is in default with respect to any note, indenture,
loan agreement, mortgage, lease, deed, or other agreement to which it is a party
or by which it or its Property is bound, which default would materially and
adversely affect any Bank's or any Agent's rights under the Loan Documents or
the financial condition or results of operations of Chemical and its
Subsidiaries taken as a whole.
Section 5.14. Status Under Certain Laws;. Neither any Borrower nor
any of its Subsidiaries is an "investment company" or a person directly or
indirectly controlled by or acting on behalf of an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, or a "holding
Company," or a "subsidiary company" of a "holding company",
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or an "affiliate" of a "holding company" or a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
Section 6. Conditions Precedent;.
The obligation of the Banks or the Administrative Agent to make any
Loan pursuant hereto shall be subject to the following conditions precedent:
Section 6.1. Initial Extension of Credit;. Prior to the initial Loan
hereunder, the following conditions precedent shall have been satisfied:
(a) the Borrowers shall have delivered to the Administrative Agent for
the benefit of the Banks in sufficient counterparts for distribution to the
Banks:
(i) the Notes (one for each Bank);
(ii) the Guaranty Agreement executed by the Guarantors;
(iii) good standing certificates for each Borrower and each
Guarantor issued by the states of Delaware, Louisiana, New
Mexico and Mississippi, as applicable, issued not more than
30 days before the date of this Agreement;
(iv) copies of the Articles of Incorporation, and all amendments
thereto, of each Borrower and each Guarantor, certified by
the Secretary of State of its state of incorporation not
more than 30 days before the date of this Agreement;
(v) copies of the By-Laws, and all amendments thereto, of each
Borrower and each Guarantor, certified as true, correct and
complete on the date hereof by the Secretary or Assistant
Secretary of each Borrower and each Guarantor;
(vi) copies, certified as true, correct and complete by the
Secretary or Assistant Secretary of each Borrower and each
Guarantor, of resolutions regarding the transactions
contemplated by this Agreement, duly adopted by the Board of
Directors of each Borrower and Guarantor and satisfactory in
form and substance to the Agents;
(vii) a pay-off letter from the Existing Banks under the Existing
Agreements in form and substance satisfactory to the Agents
and such other evidence that all of the Borrowers'
indebtedness thereunder has been fully paid as the Agents
may require;
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(viii) an incumbency and signature certificate for each Borrower
and each Guarantor satisfactory in form and substance to the
Agents;
(ix) copies, certified as true, complete and correct by the
Secretary, Assistant Secretary or other authorized officer
of Chemical, of the Acquisition Documents, together with a
certificate or certificates of the Secretary, Assistant
Secretary or other authorized officer of Chemical to the
effect that the representations and warranties of Chemical
contained in the First Mississippi Purchase Agreement are
true and correct in all material respects as of the date
thereof (except as to any representation or warranty that
specifically relates to an earlier date, each of which is
true and correct in all material respects as of such earlier
date, and except as otherwise contemplated by the First
Mississippi Purchase Agreement), that Chemical has performed
in all material respects all obligations required to be
performed by it under the First Mississippi Purchase
Agreement and that the First Mississippi Purchase Agreement
has not been amended or otherwise modified, nor has any term
or provision thereof been waived, in a manner that would
materially and adversely affect Chemical's ability to repay
its indebtedness, obligations and liabilities to the Banks
under the Loan Documents or the financial condition of
Chemical and its Subsidiaries taken as a whole; and
(x) copies (executed or certified, as may be appropriate) of all
legal documents or proceedings taken in connection with the
Acquisition and the execution and delivery of this Agreement
and the other Loan Documents to the extent the
Administrative Agent may reasonably request.
(b) the Agents shall have received (i) all fees payable to them in
connection with the execution and delivery of this Agreement and the
transactions contemplated hereby, and (ii) the fees required by Section 3.7
hereof;
(c) all conditions precedent to the Acquisition, except the completion
of the Spin-Off and the financings under this Agreement and the First
Mississippi Credit Agreement, shall have been satisfied and the Agents shall
have received evidence satisfactory to it of the foregoing;
(d) the Administrative Agent shall have received evidence satisfactory
to the Agents that the closing of the Acquisition shall occur prior to the
second Business Day immediately following the date hereof;
(e) substantially concurrently with the closing hereof, First
Mississippi and its Subsidiaries shall have executed the First Mississippi
Credit Agreement and all conditions precedent to the making of the initial loans
thereunder, except the satisfaction of the conditions precedent to the making of
the initial Loan under this Agreement shall have been fully satisfied;
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(f) the Administrative Agent shall have received evidence satisfactory
to the Agents that prior to the second Business Day immediately following the
date hereof, the closing of the Spin-Off shall occur; and
(g) the Administrative Agent shall have received evidence of insurance
required by Section 7.3 hereof; and
(h) the Administrative Agent shall have received current Phase I
environmental inspection reports for the real property listed on Schedule 6.1(i)
hereto owned by the Borrowers and the Guarantors satisfactory to the
Administrative Agent.
Section 6.2. Each Extension of Credit;. As of the time of the making
of each Loan hereunder (including the initial Loan):
(a) each of the representations and warranties set forth in Section 5
hereof shall be and remain true and correct as of said time, except that the
representations and warranties made under Section 5.2 shall be deemed to refer
to the most recent financial statements furnished to the Banks pursuant to
Section 7.4 hereof;
(b) the Borrowers shall be in full compliance with all of the terms
and conditions hereof, and no Potential Default or Event of Default shall have
occurred and be continuing;
(c) with respect to each Loan requested by Chemical, for itself or any
other Borrower, the aggregate amount of the Total Outstandings shall not exceed
the Revolving Credit Commitments;
(d) immediately after giving effect thereto, not more than 25% of the
value of the Borrowers' and their Subsidiaries' assets that are subject to
Sections 7.9 and 7.12 hereof shall constitute margin stock (as defined in
Regulation U promulgated by the Board of Governors of the Federal Reserve
System); and
(e) with respect to each Swingline Loan requested by Chemical, for
itself or any other Borrower, the aggregate principal amount of all Swingline
Loans outstanding after giving effect to the requested Swingline Loans shall not
exceed $20,000,000;
and the request by Chemical for itself or any other Borrower, for any Loan
pursuant hereto shall be and constitute a warranty to the foregoing effects.
Section 6.3. Legal Matters;. Legal matters incident to the execution
and delivery of the Loan Documents shall be satisfactory to each of the Banks
and their legal counsel; and prior to the initial Loan hereunder, the
Administrative Agent shall have received the favorable written opinion of Hughes
& Luce, L.L.P., counsel for the Borrowers, substantially in the form of Exhibit
I, and the favorable written opinions of Skadden Arps Slate Meagher & Flom
(Illinois), counsel for the Guarantors, substantially in the form of Exhibit J-
1, Donaldson, Bearman & Caldwell, special counsel to the Guarantors, in the form
of Exhibit J-2, J. Steve Chustz, Esquire, general counsel to First Mississippi
in the form of Exhibit J-3, and Phelps Dunbar, L.L.P., special
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counsel to AMPRO Fertilizer, Inc., in the form of Exhibit J-4, each in substance
satisfactory to each of the Banks and their respective legal counsel.
Section 6.4. Documents;. The Administrative Agent shall have
received copies (executed or certified, as may be appropriate) of all documents
or proceedings taken in connection with the execution and delivery of the Loan
Documents to the extent the Required Banks or their respective legal counsel
reasonably request.
Section 7. Covenants;.
It is understood and agreed that so long as credit is in use or
available under this Agreement or any amount remains unpaid on any Note,
Reimbursement Obligation or L/C except to the extent compliance in any case or
cases is waived in writing by the Required Banks:
Section 7.1. Maintenance of Property;. Each Borrower will, and will
cause each Subsidiary to, keep and maintain all of its Properties necessary or
useful in its business in good condition, and make all necessary renewals,
replacements, additions, betterments and improvements thereto; provided,
however, that nothing in this Section shall prevent the Borrowers or any
Subsidiary from discontinuing the operating and maintenance of any of its
properties if such discontinuance is, in the judgment of such Borrower,
desirable in the conduct of its business and not disadvantageous in any material
respect to the Banks as holders of the Notes.
Section 7.2. Taxes;. Each Borrower will, and will cause each
Subsidiary to, duly pay and discharge all taxes, rates, assessments, fees and
governmental charges upon or against such Borrower or any Subsidiary or against
its Properties in each case before the same becomes delinquent and before
penalties accrue thereon unless and to the extent that the same is being
contested in good faith and by appropriate proceedings and for which adequate
reserves have been established in accordance with generally accepted accounting
principles, consistently applied.
Section 7.3. Maintenance of Insurance;. Each Borrower will, and will
cause each Subsidiary to, maintain insurance with insurers recognized as
financially sound and reputable by prudent business persons in such forms and
amounts and against such risks as is usually carried by companies engaged in
similar business and owning similar Properties in the same general areas in
which such Borrower or such Subsidiary operates. Each Borrower shall provide
the Administrative Agent with evidence of insurance maintained by it upon the
Administrative Agent's request.
Section 7.4. Financial Reports;. Chemical will, and will cause each
Subsidiary to, maintain a system of accounting in accordance with sound
accounting practice and will furnish promptly to each of the Banks and their
duly authorized representatives such information respecting the business and
financial condition of Chemical and its Subsidiaries as may be reasonably
requested and, without any request, will furnish each Bank:
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(a) as soon as available, and in any event within 45 days after the
close of the first three fiscal quarters of each fiscal year of Chemical a copy
of consolidated and consolidating balance sheets and income statements and
consolidated cash flow statements for Chemical and its Subsidiaries for such
quarterly period and the year to date and for the corresponding periods of the
preceding fiscal year, all in reasonable detail, prepared by Chemical and
certified by the chief financial officer of Chemical;
(b) as soon as available, and in any event within 90 days after the
close of each fiscal year of Chemical, a copy of the audit report for such year
and accompanying financial statements, including consolidated balance sheets and
statements of income for Chemical and its Subsidiaries showing in comparative
form the figures for the previous fiscal year of Chemical, all in reasonable
detail, prepared and certified by Arthur Andersen LLP or other independent
public accountants of nationally recognized standing selected by Chemical and
reasonably satisfactory to the Administrative Agent and copies of unaudited
consolidating balance sheets and statements of income for Chemical and its
Subsidiaries;
(c) together with the financial statements required by (a) and (b)
above, a Compliance Certificate in the form of Exhibit H attached hereto,
prepared and signed by the President or Chief Financial Officer of Chemical;
(d) promptly upon their becoming available, copies of all registration
statements and regular periodic reports, if any, which Chemical shall have filed
with the Securities and Exchange Commission or any governmental agency
substituted therefor, or any national securities exchange, including copies of
Chemical's form 10-K annual report, including financial statements audited by
Arthur Andersen LLP or other independent public accountants of nationally
recognized standing selected by Chemical and reasonably satisfactory to the
Bank, its form 10-Q quarterly report to the Securities and Exchange Commission
and any Form 8-K filed by Chemical with the Securities and Exchange Commission;
(e) promptly upon the mailing thereof to the shareholders of Chemical
generally, copies of all financial statements, reports and proxy statements so
mailed; and
(f) as soon as available, and in any event within 45 days after the
close of the last fiscal quarter of each fiscal year of Chemical and its
Subsidiaries either (i) a Compliance Certificate in the form required by
subsection (c) above or (ii) a certificate in the form of Exhibit L attached
hereto (the "Pricing Ratio Certificate") prepared and signed by the President or
Chief Financial Officer of Chemical showing the calculation of the Pricing Ratio
as of the last day of the fiscal quarter of Chemical and its Subsidiaries then
ended.
Section 7.5. Inspection;. Each Borrower shall, and shall cause each
Subsidiary to, permit each of the Banks, by their representatives and
Administrative Agents, to inspect any of the Properties, corporate books and
financial records of such Borrower, and each Subsidiary, to examine and make
copies of the books of accounts and other financial records of each Borrower and
their Subsidiaries and to discuss the affairs, finances and accounts of each
Borrower and their Subsidiaries with, and to be advised as to the same by, its
officers at such reasonable times
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and reasonable intervals as the Required Banks may reasonably request. The
Borrowers shall pay the reasonable costs and expenses of the Administrative
Agent in connection with any inspection of the Borrowers' and their
Subsidiaries' books and records.
Section 7.6. Consolidation and Merger;. Each Borrower will not, and
will not permit any Subsidiary to, consolidate with or merge into any Person, or
permit any other Person to merge into it, or acquire (in a transaction analogous
in purpose or effect to a consolidation or merger) all or substantially all of
the Property of any other Person, except that:
(a) any Person may merge into any Borrower or any Subsidiary so long
as:
(i) such Borrower or Subsidiary shall be the surviving entity;
provided, however, that such Borrower or Subsidiary is not
required to be the surviving entity if such Borrower's or
Subsidiary's board of directors becomes a majority of the board
of directors of the surviving entity immediately upon completion
of such transaction and such surviving Person shall agree to
assume each and every obligation of such Borrower or Subsidiary
pursuant to this Agreement and any other Loan Document;
(ii) the Person merging with or into a Borrower or a Subsidiary of a
Borrower shall be in the same line or a related line of business
as such Borrower or Subsidiary;
(iii) the board of directors (or equivalent governing body) of such
Person shall have given its prior effective written consent or
approval of such merger; and
(iv) no Potential Default or Event of Default shall exist before or
after giving effect to such merger; and
(b) any Subsidiary of Chemical may be merged or consolidated with or
into: (i) Chemical, if Chemical should be the continuing or surviving
corporation, or (ii) any other Subsidiary of Chemical, provided that if such
other Subsidiary is a Borrower or Guarantor such other Subsidiary shall be the
continuing or surviving corporation.
Section 7.7. Transactions with Affiliates;. Each Borrower will not,
and will not permit any Subsidiary to, enter into any transaction, including
without limitation, the purchase, sale, lease or exchange of any Property, or
the rendering of any service, with any Affiliate of such Borrower except in the
ordinary course of and pursuant to the reasonable requirements of such
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to such Borrower or such Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate of such
Borrower; provided however that the foregoing shall not prevent any transactions
between any Borrower and any other Borrower on any terms mutually acceptable to
them.
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Section 7.8. Dividends and Certain Other Restricted Payments;.
Chemical will not and will not permit its Subsidiaries to (a) declare or pay any
dividends or make any distribution on any class of its capital stock (other than
dividends payable solely in its capital stock) or (b) directly or indirectly
purchase, redeem or otherwise acquire or retire any of its capital stock (except
out of the proceeds of, or in exchange for, a substantially concurrent issue and
sale of capital stock) or (c) make any other distributions with respect to its
capital stock (collectively, "Restricted Payments"); unless no Potential Default
or Event of Default shall exist before and after giving effect thereto.
Section 7.9. Liens;. Each Borrower will not, and will not permit any
Subsidiary to, pledge, mortgage or otherwise encumber or subject to or permit to
exist upon or be subjected to any lien, charge or security interest of any kind
(including any conditional sale or other title retention agreement and any lease
in the nature thereof), on any of its Properties of any kind or character at any
time owned by such Borrower or any Subsidiary, other than:
(a) liens, pledges or deposits for worker's compensation, unemployment
insurance, old age benefits or social security obligations, taxes, assessments,
statutory obligations or other similar charges, good faith deposits made in
connection with tenders, contracts or leases to which a Borrower or a Subsidiary
is a party or other deposits required to be made in the ordinary course of
business, provided in each case the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate proceedings and
adequate reserves have been provided therefor in accordance with generally
accepted accounting principles and that the obligation is not for borrowed
money, customer advances, trade payables, or obligations to agricultural
producers;
(b) the pledge of assets for the purpose of securing an appeal or stay
or discharge in the course of any legal proceedings, provided that the aggregate
amount of liabilities of any Borrower or a Subsidiary so secured by a pledge of
property permitted under this subsection (b) including interest and penalties
thereon, if any, shall not be in excess of $10,000,000 at any one time
outstanding;
(c) liens, pledges, mortgages, security interests or other charges
existing on the date hereof and disclosed in the audited financial statements
referred to in Section 5.2 hereof;
(d) liens for property taxes and assessments or governmental charges
or levies which are not yet due and payable;
(e) liens incidental to the conduct of business or the ownership of
properties and assets (including warehousemen's and attorneys' liens and
statutory landlords' liens) or other liens of like general nature incurred in
the ordinary course of business and not in connection with the borrowing of
money, provided in each case, the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate actions or proceedings
and adequate reserves have been provided therefor in accordance with generally
accepted accounting principles, consistently applied;
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(f) minor survey exceptions or minor encumbrances, easements or
reservations, or rights of others for rights-of-way, utilities and other similar
purposes, or zoning or other restrictions as to the use of real properties,
which are necessary for the conduct of the activities of the Borrowers and their
Subsidiaries or which customarily exist on properties of corporations engaged in
similar activities and similarly situated and which do not in any event
materially impair their use in the operation of the business of the Borrowers
and their Subsidiaries;
(g) the interests of lessors under Capitalized Leases;
(h) liens not otherwise permitted under this Section 7.9 on Property
of Chemical and its Subsidiaries securing Debt that is in an aggregate
outstanding principal amount not exceeding 5% of the value (determined in
accordance with generally accepted accounting principles consistently applied as
shown on the most recent financial statements delivered pursuant to Section 7.4
hereof) of Chemical's Total Assets; and
(i) liens upon tangible personal property acquired after the date
hereof (by purchase, construction or otherwise), or upon other property acquired
after the date hereof as a capital expenditure, by Chemical or any of its
Subsidiaries, each of which liens either (A) existed on such Property before the
time of its acquisition and was not created in anticipation thereof or (B) was
created solely for the purpose of securing indebtedness representing, or
incurred to finance, refinance or refund, the cost of such Property; provided
that (A) no such lien shall extend to or cover any Property of Chemical or any
of its Subsidiaries other than the Property so acquired, (B) the principal
amount of indebtedness secured by any such lien shall not exceed the fair market
value of such Property at the time of acquisition, and (C) the aggregate
principal amount of all indebtedness secured by such liens shall not at any one
time exceed $10,000,000.
Section 7.10. Borrowings and Guaranties;. Each Borrower will not,
and will not permit any Subsidiary to, issue, incur, assume, create or have
outstanding any Debt, nor be or remain liable, whether as endorser, surety,
guarantor or otherwise, for or in respect of any Debt of any other Person, other
than:
(a) indebtedness of the Borrowers arising under or pursuant to this
Agreement or the other Loan Documents and under the Chemical Guaranty;
(b) indebtedness of the Guarantors under the Guaranty and under the
First Mississippi Credit Agreement and related documents;
(c) the liability of the Borrowers and their Subsidiaries arising out
of the endorsement for deposit or collection of commercial paper received in the
ordinary course of business;
(d) indebtedness of the Borrowers and their Subsidiaries existing on
the date hereof and disclosed to the Banks in the financial statements referred
to in Section 5.2 hereof;
(e) the liability of the Borrowers with respect to the Farmland
MissChem Project Contingent Obligations disclosed on Exhibit K hereto;
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(f) indebtedness not otherwise permitted under this Section 7.10 of
all Subsidiaries of Chemical in an aggregate principal amount of up to 5% of the
value (determined in accordance with generally accepted accounting principles
consistently applied as shown on the most recent financial statements delivered
pursuant to Section 7.4 hereof) of the Total Assets of Chemical; and
(h) indebtedness for borrowed money of Chemical not otherwise
permitted by this Section 7.10; provided that Chemical is in compliance with
Section 7.21 hereof.
Section 7.11. Investments, Loans, Advances and Acquisitions;. Each
Borrower will not, and will not permit any Subsidiary to, make or retain any
investment (whether through the purchase of stock, obligations or otherwise) in
or make any loan or advance to, any other Person, or acquire substantially as an
entirety the Property or business of any other Person, other than:
(a) investments in direct obligations of the United States of America
or of any agency or instrumentality thereof whose obligations constitute full
faith and credit obligations of the United States of America, provided that any
such obligations shall mature within one year of the date of issuance thereof;
(b) investments in commercial paper rated either P-1 by Moody's
Investors Services, Inc. or A-1 by Standard & Poor's Corporation maturing within
270 days of the date of issuance thereof;
(c) investments in certificates of deposit issued by any United States
commercial bank or a branch located in the United States of a foreign commercial
bank in each case having capital and surplus of not less than $500,000,000 which
have a maturity of one year or less;
(d) investments in repurchase obligations with a term of not more than
thirty (30) days for underlying securities of the types described in subsection
(a) above entered into with any bank meeting the qualifications specified in
subsection (c) above, provided all such agreements require physical delivery of
the securities securing such repurchase agreement, except those delivered
through the Federal Reserve Book Entry System;
(e) investments in money market funds that invest solely, and which
are restricted by their respective charters to invest solely, in investments of
the type described in the immediately preceding subsections (a), (b), (c) and
(d) above;
(f) marketable general obligations of a state, a territory or a
possession of the United States, or any political subdivision of any of the
foregoing, or the District of Columbia, unconditionally secured by the full
faith and credit of such state, territory, possession, political subdivision or
district provided that such state, territory, possession, political subdivision
or district has general taxing authority and the power to levy such taxes as may
be required for the payment of principal and interest thereof; provided that
such obligations are rated in either of the two top rating categories
established by the national rating agencies for such obligations;
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(g) marketable corporate debt securities having an A credit rating or
better by Standard & Poor's Corporation or Moody's Investors Service;
(h) investments shown on the financial statements referred to in
Section 5.2;
(i) loans and advances from any Borrower to any Subsidiary except
Triad (so long as Triad is in existence), provided that the aggregate
outstanding amount of all such loans and advances to Subsidiaries that are not
Guarantors or Borrowers shall not exceed $35,000,000 at any time;
(j) other investments in and acquisitions (other than by merger or
consolidation) of the Property or business of any Person or a majority of the
capital stock or other equity interests of any other Person, provided that:
(i) such Person shall be in the same or a related line of
business as the Borrowers or one or more Subsidiaries;
(ii) the board of directors (or equivalent governing body) of
such Person shall have given its prior effective written
consent or approval of such acquisition; and
(iii) no Potential Default or Event of Default shall exist before
or after giving effect to such acquisition;
(k) so long as Triad is in existence, investments, loans and advances
made by the Borrowers to Triad in an aggregate amount not to exceed (i)
$12,500,000 at any one time outstanding from and including the date hereof to
and including December 31, 1997 and (ii) $5,000,000 in any fiscal year
thereafter;
(l) investments in or loans to Farmland MissChem Ltd. in connection
with the Farmland MissChem Project in an aggregate amount not exceeding
$100,000,000 at any one time outstanding; and
(m) investments, loans and advances not otherwise permitted under this
Section 7.11 in an aggregate amount not exceeding 10% of the Tangible Net Worth
of Chemical at any one time outstanding.
Section 7.12. Sale of Property;. Each Borrower will not and will not
permit any Subsidiary to, sell, lease, assign, transfer or otherwise dispose of
(whether in one transaction or in a series of related transactions) all or a
material part of its Property to any other Person during each fiscal year of
Chemical; provided, however, that each Borrower and their Subsidiaries may make:
(a) sales of its Inventory in the ordinary course of business,
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(b) sales or leases of its machinery and equipment that is obsolete,
unusable or not needed for such Borrower's operations in the ordinary course of
its business,
(c) sale and leaseback transactions permitted by Section 7.17 hereof;
(d) sales of Property having a fair market value up to 5% of the Total
Assets of Chemical; provided, however, sales of Property having a fair market
value greater than 5% and up to 15% of the Total Assets of Chemical shall be
permitted, so long as the amount of the net proceeds of such sale in excess of
5% of the Total Assets of Chemical are reinvested in a line of business of any
of the Borrowers; and
(e) the Spin-Off.
For purposes of this Section, "material part" shall mean Property having a fair
market value in excess of an amount equal to 5% of the Total Assets of Chemical.
Section 7.13. Notice of Suit or Adverse Change in Business or
Default;. Each Borrower shall, as soon as possible, and in any event within
five (5) days after such Borrower learns of the following, give written notice
to the Banks of (a) any material proceeding(s) being instituted or threatened to
be instituted by or against any Borrower or any Subsidiary in any federal,
state, local or foreign court or before any commission or other regulatory body
(federal, state, local or foreign), (b) any material adverse change in the
business, Property or condition, financial or otherwise of any Borrower and (c)
the occurrence of any Potential Default or Event of Default.
Section 7.14. ERISA;. Each Borrower will, and will cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed is likely to
result in the imposition of a lien against any of its Property and will promptly
notify the Administrative Agent of (a) the occurrence of any reportable event
(as defined in ERISA) which might result in the termination by the PBGC of any
Plan, (b) receipt of any notice from PBGC of its intention to seek termination
of any such Plan or appointment of a trustee therefor, and (c) its intention to
terminate or withdraw from any Plan. Each Borrower will not, and will not
permit any Subsidiary to, terminate any such Plan or withdraw therefrom unless
it shall be in compliance with all of the terms and conditions of this Agreement
after giving effect to any liability to PBGC resulting from such termination or
withdrawal.
Section 7.15. Use of Proceeds;. The Borrowers shall use the proceeds
of the initial Revolving Credit Loans to pay all indebtedness, obligations and
liabilities of the Borrowers under the Credit Agreement dated as of April 26,
1996 by and among Chemical, Phosphates, Potash, MCC Pipeline, Inc., NationsBank
of Tennessee, N.A., as Agent and the Banks named therein (the "Existing
Agreement") to the lenders named therein (the "Existing Banks") and all other
Loans made hereunder and all L/C's issued hereby for general corporate purposes,
including, without limitation, financing acquisitions, capital expenditures,
refinancing existing debt and providing for ongoing working capital needs.
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Section 7.16. Compliance with Laws, etc. ;Each Borrower will, and
will cause each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations and orders, including Environmental Laws,
such compliance to include (without limitation) the maintenance and preservation
of its corporate existence and qualification as a foreign corporation.
Section 7.17. Sale and Leaseback Transactions;. Neither any Borrower
nor any of its Subsidiaries shall, directly or indirectly, enter into any
arrangement with any Person providing for any Borrower or a Subsidiary to lease
or rent Property that any Borrower or a Subsidiary has or will sell or otherwise
transfer to such Person, unless the aggregate net cash proceeds of any such
sales in any 12-month period are less than 5% of Chemical's Tangible Net Worth.
Section 7.18. Triad Chemical Product Withdrawal Agreement;. So long
as Triad is in existence, Chemical shall not consent to any amendment,
modification or waiver of the terms of the Triad Chemical Product Withdrawal
Agreement.
Section 7.19. Fiscal Quarters;. No Borrower shall change its fiscal
quarters.
Section 7.20 New Subsidiaries;. Neither any Borrower nor any
Subsidiary shall, directly or indirectly, organize or acquire any Subsidiary not
listed on Exhibit G attached hereto, except as permitted by Section 7.11(j)
hereof.
Section 7.21. Maximum Leverage Ratio;. Chemical will, as of the last
day of each fiscal quarter of Chemical maintain a Leverage Ratio less than or
equal to 3.50 to 1.0.
Section 7.22. Minimum Interest Coverage Ratio;. Chemical will, as of
the last day of each fiscal quarter of Chemical, maintain an Interest Coverage
Ratio of not less than 2.50 to 1.0.
Section 7.23. Minimum Tangible Net Worth;. Chemical will, as of the
last day of each fiscal quarter of Chemical specified below, maintain its
Tangible Net Worth in an amount not less than:
(a) for the fiscal quarter ending December 31, 1996, $168,750,000;
(b) for the fiscal quarter ending March 31, 1997, the sum of (i)
$168,750,000, plus (ii) 50% of Chemical's Net Income (but not less than zero)
for the same period; and
(c) for each fiscal quarter ending thereafter, the sum of (i) the
minimum amount of Tangible Net Worth Chemical was required to maintain during
the immediately preceding fiscal quarter, plus (ii) 50% of Chemical's Net Income
(but not less than zero) for such fiscal quarter then ended.
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Section 8. Events of Default and Remedies;.
Section 8.1. Definitions;. Any one or more of the following shall
constitute an Event of Default:
(a) Default in the payment when due of (i) any principal of any Note
or any Reimbursement Obligation (ii) any interest on any Note or any
Reimbursement Obligation which continues unremedied for 5 Business Days, whether
at the stated maturity thereof or at any other time provided in this Agreement,
or default in the payment when due of any fee or other amount payable by any
Borrower pursuant to this Agreement, which continues unremedied for 5 Business
Days;
(b) Default in the observance or performance of any covenant set forth
in Sections 7.3, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.13, 7.15,
7.16, 7.18, 7.19, 7.20, 7.21, 7.22 or 7.23 hereof;
(c) Default in the observance or performance of any other covenant,
condition, agreement or provision hereof or any of the other Loan Documents and
such default shall continue for 30 days after written notice thereof to the
Borrowers by any Bank;
(d) Default shall occur under any evidence of Debt (other than the
First Mississippi Credit Agreement) in a principal amount exceeding $10,000,000
issued or assumed or guaranteed by any Borrower or any Subsidiary, or under any
mortgage, agreement or other similar instrument under which the same may be
issued or secured and such default shall continue for a period of time
sufficient to permit the acceleration of maturity of any indebtedness evidenced
thereby or outstanding or secured thereunder;
(e) Any representation or warranty made by any Borrower herein or in
any Loan Document or in any statement or certificate furnished by it pursuant
hereto or thereto, proves untrue in any material respect as of the date made or
deemed made pursuant to the terms hereof;
(f) Any judgment or judgments, writ or writs, or warrant or warrants
of attachment, or any similar process or processes in an aggregate amount in
excess of $10,000,000 shall be entered or filed against any Borrower or any
Subsidiary or against any of their respective Property or assets and remain
unstayed and undischarged for a period of 30 days from the date of its entry;
(g) Any Guarantor shall purport to breach, disavow, revoke, repudiate
or terminate the Guaranty Agreement, or any event specified in Sections 8.1(k)
or (l) shall occur with regard to any Guarantor, or any "Event of Default" (as
defined in the Guaranty) shall occur with regard to any Guarantor;
(h) The closing of the Acquisition has not occurred prior to the
second Business Day immediately following the date hereof;
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(i) The completion of the Spin-Off has not occurred prior to the
second Business Day immediately following the date hereof;
(j) Any reportable event (as defined in ERISA) which constitutes
grounds for the termination of any Plan or for the appointment by the
appropriate United States District Court of a trustee to administer or liquidate
any such Plan, shall have occurred and be continuing thirty (30) days after
written notice to such effect shall have been given to Chemical by any Bank; or
any such Plan shall be terminated; or a trustee shall be appointed by the
appropriate United States District Court to administer any such Plan; or the
Pension Benefit Guaranty Corporation shall institute proceedings to administer
or terminate any such Plan;
(k) Any Borrower or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the Bankruptcy Code of 1978,
as amended, (ii) admit in writing its inability to pay, or not pay, its debts
generally as they become due, (iii) make an assignment for the benefit of
creditors, (iv) apply for, seek, consent to, or acquiesce in, the appointment of
a receiver, custodian, trustee, conservator, liquidator or similar official for
it or any substantial part of its property, (v) file a petition seeking relief
or institute any proceeding seeking to have entered against it an order for
relief under the Bankruptcy Code of 1978, as amended, to adjudicate it
insolvent, or seeking dissolution, winding up, liquidation, reorganization,
arrangement, marshaling of assets, adjustment or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, or (vi) fail to contest in
good faith any appointment or proceeding described in Section 8.1(l) hereof;
(l) A custodian, receiver, trustee, conservator, liquidator or similar
official shall be appointed for any Borrower or any Subsidiary of a Borrower or
any substantial part of its respective Property, or a proceeding described in
Section 8.1(k)(v) shall be instituted against any Borrower or any Subsidiary of
a Borrower and such appointment continues undischarged or any such proceeding
continues undismissed or unstayed for a period of 90 days; or
(m) a Change of Control shall occur.
Section 8.2. Remedies for Non-Bankruptcy Defaults;. When any Event
of Default, other than an Event of Default described in subsections (k) and (l)
of Section 8.1 hereof, has occurred and is continuing, the Administrative Agent,
if directed by the Required Banks, shall give written notice to Chemical and
take any or all of the following actions: (a) terminate the remaining Revolving
Credit Commitments hereunder on the date (which may be the date thereof) stated
in such notice, (b) declare the principal of and the accrued interest on the
Notes and Reimbursement Obligations to be forthwith due and payable and
thereupon the Notes and Reimbursement Obligations including both principal and
interest, shall be and become immediately due and payable without further
demand, presentment, protest or notice of any kind, and (c) take any action or
exercise any remedy under any of the Loan Documents or exercise any other
action, right, power or remedy permitted by law. Any Bank may exercise the
right of set
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off with regard to any deposit accounts or other accounts or investments
maintained by any Borrower with any of the Banks.
Section 8.3. Remedies for Bankruptcy Defaults;. When any Event of
Default described in subsections (k) or (l) of Section 8.1 hereof has occurred
and is continuing, then the Notes and Reimbursement Obligations shall
immediately become due and payable without presentment, demand, protest or
notice of any kind, and the obligation of the Banks to extend further credit
pursuant to any of the terms hereof shall immediately terminate.
Section 8.4. L/Cs;. Promptly following the acceleration of the
maturity of the Notes pursuant to Section 8.2 or 8.3 hereof, the Borrowers shall
immediately pay to the Administrative Agent for the benefit of the Banks the
full aggregate amount of all outstanding L/Cs issued for any Borrower's account
hereunder. The Administrative Agent shall hold all such funds and proceeds
thereof as additional collateral security for the obligations of the Borrowers
to the Banks under the Loan Documents. The amount paid under any of the L/Cs
for which any Borrower has not reimbursed the Banks shall bear interest from the
date of such payment at the default rate of interest specified in Section
1.3(d)(i) hereof.
Section 9. Change in Circumstances Regarding Fixed Rate Loans;.
Section 9.1. Change of Law;. Notwithstanding any other provisions of
this Agreement or any Note to the contrary, if at any time after the date hereof
with respect to Fixed Rate Loans, any Bank shall determine in good faith that
any change in applicable law or regulation or in the interpretation thereof
makes it unlawful for such Bank to make or continue to maintain any Fixed Rate
Loan or to give effect to its obligations as contemplated hereby, such Bank
shall promptly give notice thereof to the Borrowers describing in reasonable
detail the basis for such Bank's determination and to the Administrative Agent
to such effect, and such Bank's obligation to make, relend, continue or convert
any such affected Fixed Rate Loans under this Agreement shall terminate until it
is no longer unlawful for such Bank to make or maintain such affected Loan. The
Borrowers shall prepay the outstanding principal amount of any such affected
Fixed Rate Loan made to it, together with all interest accrued thereon and all
other amounts due and payable to the Banks under Section 9.4 of this Agreement,
on the earlier of the last day of the Interest Period applicable thereto and the
first day on which it is illegal for such Bank to have such Loans outstanding;
provided, however, the affected Borrower may borrow a principal amount equal to
the principal amount of such affected Loan by means of another type of Loan
available hereunder, subject to all of the terms and conditions of this
Agreement.
Section 9.2. Unavailability of Deposits or Inability to Ascertain the
Adjusted Eurodollar Rate;. Notwithstanding any other provision of this
Agreement or any Note to the contrary, if prior to the commencement of any
Interest Period any Bank shall determine (i) that deposits in the amount of any
Eurodollar Loan scheduled to be outstanding are not available to it in the
relevant market by reason of circumstances affecting the interbank Eurodollar
market generally or (ii) by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the Adjusted
Eurodollar Rate, then such Bank shall promptly give telephonic or telex notice
thereof to the Borrowers, the Administrative Agent
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and the other Banks (such notice to be confirmed in writing), and the obligation
of the Banks to make, continue or convert any such Fixed Rate Loan in such
amount and for such Interest Period shall terminate until deposits in such
amount and for the Interest Period selected by the affected Borrower shall again
be readily available in the relevant market and adequate and reasonable means
exist for ascertaining the Adjusted Eurodollar Rate. Upon the giving of such
notice, the affected Borrower may elect to either (i) pay or prepay, as the case
may be, such affected Loan or (ii) reborrow such affected Loan as another type
of Loan available hereunder, subject to all terms and conditions of this
Agreement.
Section 9.3. Taxes and Increased Costs;. With respect to the Fixed
Rate Loans, if any Bank shall determine in good faith that any change in any
applicable law, treaty, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any new
law, treaty, regulation or guideline, or any interpretation of any of the
foregoing by any governmental authority charged with the administration thereof
or any central bank or other fiscal, monetary or other authority having
jurisdiction over such Bank or its lending branch or the Fixed Rate Loans
contemplated by this Agreement (whether or not having the force of law) ("Change
in Law") shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirements against assets held by,
or deposits in or for the account of, or Loans by, or
any other acquisition of funds or disbursements by,
such Bank (other than reserves included in the
determination of the Adjusted Eurodollar Rate);
(ii) subject such Bank, any Fixed Rate Loan or any Note to
any tax (including, without limitation, any United
States interest equalization tax or similar tax however
named applicable to the acquisition or holding of debt
obligations and any interest or penalties with respect
thereto), duty, charge, stamp tax, fee, deduction or
withholding in respect of this Agreement, any Fixed
Rate Loan or any Note except such taxes as may be
measured by the overall net income of such Bank or its
lending branch and imposed by the jurisdiction, or any
political subdivision or taxing authority thereof, in
which such Bank's principal executive office or its
lending branch is located;
(iii) change the basis of taxation of payments of principal
and interest due from any Borrower to such Bank
hereunder or under any Note (other than by a change in
taxation of the overall net income of such Bank); or
(iv) impose on such Bank any penalty with respect to the
foregoing or any other condition regarding this
Agreement, any Fixed Rate Loan or any Note;
and such Bank shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to such Bank
of making or maintaining any
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Fixed Rate Loan hereunder or to reduce the amount of principal or interest
received by such Bank, then, if such Bank is generally imposing payments for
increased costs on its similarly situated customers, the Borrowers shall pay to
such Bank from time to time as specified by such Bank such additional amounts as
such Bank shall reasonably determine are sufficient to compensate and indemnify
it for such increased cost or reduced amount. If any Bank makes such a claim for
compensation, it shall provide to the Borrowers a certificate setting forth such
increased cost or reduced amount as a result of any event mentioned herein
specifying such Change in Law, and such certificate shall be conclusive and
binding on the Borrowers as to the amount thereof except in the case of manifest
error. Upon the imposition of any such cost, the Borrowers may prepay any
affected Loan, subject to the provisions of Sections 3.4 and 9.4 hereof.
Section 9.4. Funding Indemnity;. (a) In the event any Bank shall
incur any loss, cost, expense or premium (including, without limitation, any
loss, cost, expense or premium incurred by reason of the liquidation or re-
employment of deposits or other funds acquired by such Bank to fund or maintain
any Fixed Rate Loan or the relending or reinvesting of such deposits or amounts
paid or prepaid to such Bank) as a result of:
(i) any payment or prepayment of a Fixed Rate Loan on a
date other than the last day of the then applicable
Interest Period;
(ii) any failure by any Borrower to borrow, continue or
convert any Fixed Rate Loan on the date specified in
the notice given pursuant to Sections 1.7 or 2.4
hereof; or
(iii) the occurrence of any Event of Default;
then, upon the demand of such Bank, the relevant Borrower shall pay to such Bank
such amount as will reimburse such Bank for such actual loss, cost or expense
(the calculation of such loss or expense shall include a credit (not in excess
of such loss or expense) for the interest to be earned by such Bank as a result
of redepositing such amount in the relevant interbank market).
(b) If any Bank makes a claim for compensation under this Section 9.4,
it shall provide to the relevant Borrower a certificate setting forth the amount
of such loss, cost or expense in reasonable detail and such certificate shall be
conclusive and binding on the Borrowers as to the amount thereof except in the
case of manifest error.
Section 9.5. Lending Branch;. Each Bank may, at its option, elect to
make, fund or maintain its Eurodollar Loans hereunder at the branch or office
specified opposite its signature on the signature page hereof or such other of
its branches or offices as such Bank may from time to time elect, subject to the
provisions of Section 1.7(b) hereof.
Section 9.6. Discretion of Bank as to Manner of Funding;.
Notwithstanding any provision of this Agreement to the contrary, each Bank shall
be entitled to fund and maintain its funding of all or any part of its Loans in
any manner it sees fit, it being understood however, that
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for the purposes of this Agreement all determinations hereunder shall be made as
if the Banks had actually funded and maintained each Fixed Rate Loan during each
Interest Period for such Loan through the purchase of deposits in the relevant
interbank market having a maturity corresponding to such Interest Period and
bearing an interest rate equal to the interest rate applicable thereto
(exclusive of the Applicable Margin) for such Interest Period.
Section 9.7. Mitigation of Circumstances; Replacement of Affected
Banks;. (a) Banks' Duty to Mitigate. Each Bank agrees that, as promptly as
practicable after it becomes aware of the occurrence of an event or the
existence of a condition that would cause it to be affected under Section 1.9,
9.1, 9.2 or 9.3 hereof, such Bank will, after written notice to the Borrowers,
to the extent not inconsistent with such Bank's internal policies and customary
business practices, use its best efforts to make, fund or maintain the affected
Fixed Rate Loan or issue or participate in the affected L/C, as the case may be,
through another lending office of such Bank if as a result thereof the
unlawfulness which would otherwise require payment of such Fixed Rate Loan
pursuant to Section 9.1 or 9.2 hereof would cease to exist or the circumstances
which would otherwise terminate such Bank's obligation to make such Fixed Rate
Loan under Section 9.1 or 9.2 hereof would cease to exist or the increased costs
which would otherwise be required to be paid in respect of such Fixed Rate Loan
or L/C pursuant to Section 1.9 or 9.3 hereof would be materially reduced, and
if, as determined by such Bank, in its sole discretion, the making, funding or
maintaining of such Fixed Rate Loan, or issuance or participation in such L/C,
as the case may be, through such other lending office would not, in the judgment
of such Bank, be otherwise disadvantageous to such Bank. The Borrowers hereby
agree to pay all reasonable expenses incurred by each such Bank in utilizing
another lending office pursuant to this Section 9.7(a).
(b) Replacement of Affected Banks. At any time any Bank is affected
by any condition or circumstance set forth in Section 1.9, 9.1, 9.2 or 9.3, and
so long as no Event of Default, or Potential Default exists, (i) Chemical may
replace such affected Bank as a party to this Agreement with one or more other
banks or financial institutions reasonably acceptable to the Administrative
Agent, (and upon notice from Chemical such affected Bank shall assign, pursuant
to Section 11.17, without recourse or warranty, its Commitment, its Loans, its
Notes and all of its other rights and obligations hereunder to such replacement
banks or other financial institutions for a purchase price equal to the sum of
the principal amount of the Loans so assigned, all accrued and unpaid interest
thereon, its ratable share of all accrued and unpaid facility fees and its
ratable share of the remaining unpaid Reimbursement Obligations owed to the
affected Bank and all other amounts owed to such Bank under the Loan Documents)
and/or (ii) Chemical may (and, if Chemical replaces any affected Bank in part as
provided in clause (i) above, concurrently with such replacement Chemical shall)
cause such affected Bank to cease to be a party hereto by terminating the
Commitment of such Bank, paying, and causing any other relevant Borrowers to
pay, the principal amount of such affected Bank's Loans, all accrued and unpaid
interest thereon, all accrued and unpaid facility fees owed to such affected
Bank and the remaining unpaid Reimbursement Obligations owed to such affected
Bank and any other amounts due to such affected Bank under the Loan Documents,
in each case to the extent not assigned and purchased pursuant to clause (i)
above, and such affected Bank shall thereupon cease to be a party hereto.
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Section 10. The Agents.
Section 10.1. Appointment and Powers;. (a) Harris is hereby
appointed by the Banks as Administrative Agent under the Loan Documents and each
of the Banks hereby irrevocably authorizes the Administrative Agent to act as
the Administrative Agent of such Bank. The Administrative Agent agrees to act
as such upon the express conditions contained in the Loan Documents.
(b) Bank of Montreal is hereby appointed by the Administrative Agent
as Syndication Agent under the Loan Documents and the Administrative Agent
hereby irrevocably authorizes the Syndication Agent to act as the Syndication
Agent for the Banks. The Syndication Agent agrees to act as such upon the
express conditions contained in the Loan Documents.
Section 10.2. Powers;. The Agents shall have and may exercise such
powers hereunder as are specifically delegated to the Agents by the terms of the
Loan Documents, together with such powers as are incidental thereto. The Agents
shall have no implied duties to the Banks nor any obligation to the Banks to
take any action under the Loan Documents except any action specifically provided
by the Loan Documents to be taken by the Agents.
Section 10.3. General Immunity;. Neither any Agent nor any of such
Agent's directors, officers, agents or employees shall be liable to the Banks or
any Bank for any action taken or omitted to be taken by it or them under the
Loan Documents or in connection therewith except for its or their own gross
negligence or willful misconduct.
Section 10.4. No Responsibility for Loans, Recitals, etc;. No Agent
shall (i) be responsible to the Banks for any recitals, reports, statements,
warranties or representations contained in the Loan Documents or furnished
pursuant thereto, (ii) be responsible for any Loans by any other Bank hereunder,
or (iii) be bound to ascertain or inquire as to the performance or observance of
any of the terms of the Loan Documents. In addition, no Agent nor such Agent's
counsel shall be responsible to the Banks for the enforceability or validity of
any of the Loan Documents.
Section 10.5. Right to Indemnity;. The Banks hereby indemnify each
Agent for any actions taken in accordance with this Section 10, and each Agent
shall be fully justified in failing or refusing to take any action hereunder
unless it shall first be indemnified to its satisfaction by the Banks pro rata
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action, other than any liability which
may arise out of such Agent's gross negligence or willful misconduct.
Section 10.6. Action Upon Instructions of Banks;. Each Agent agrees,
upon the written request of the Required Banks, to take any action of the type
specified in the Loan Documents as being within such Agent's rights, duties,
powers or discretion. Each Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with written
instructions signed by the Required Banks (or all of the Banks, as applicable),
and such
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instructions and any action taken or failure to act pursuant thereto shall be
binding on all of the Banks and on all holders of the Notes. In the absence of a
request by the Required Banks, each Agent shall have authority, in its sole
discretion, to take or not to take any action, unless the Loan Documents
specifically require the consent of the Required Banks or all of the Banks.
Section 10.7. Employment of Agents and Counsel;. Each Agent may
execute any of its duties as Agent hereunder by or through employees, agents,
and attorneys-in-fact and shall not be answerable to the Banks, except as to
money or securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it in good faith
and with reasonable care. Each Agent shall be entitled to advice and opinion of
legal counsel concerning all matters pertaining to the duties of the agencies
hereby created.
Section 10.8. Reliance on Documents; Counsel';. Each Agent shall be
entitled to rely upon any note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of legal counsel selected by such Agent.
Section 10.9. May Treat Payee as Owner;. Each Agent may deem and
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until a written notice of the assignment or transfer thereof shall have been
filed with such agent. Any request, authority or consent of any person, firm or
corporation who at the time of making such request or giving such authority or
consent is the holder of any such Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note issued in
exchange therefor.
Section 10.10. Agents' Reimbursement;. Each Bank agrees to reimburse
each Agent pro rata in accordance with its Commitment Percentage for any
reasonable out-of-pocket expenses (including fees and charges for inspections)
not reimbursed by the Borrowers (a) for which such Agent is entitled to
reimbursement by the Borrowers under the Loan Documents and (b) for any other
reasonable expenses incurred by such Agent on behalf of the Banks, in connection
with the preparation, execution, delivery, administration and enforcement of the
Loan Documents.
Section 10.11. Rights as a Bank;. With respect to its commitment,
Loans made by it, L/Cs issued by it, and the Notes issued to it, each Agent
shall have the same rights and powers hereunder as any Bank and may exercise the
same as though it were not such Agent, and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include each Agent in its individual
capacity to the extent, if any, of its Revolving Credit Commitment. Each Agent
may accept deposits from, lend money to, and generally engage in any kind of
banking or trust business with the Borrowers as if it were not such Agent.
Section 10.12. Bank Credit Decision;. Each Bank acknowledges that it
has, independently and without reliance upon any Agent or any other Bank and
based on the financial statements referred to in Section 5.2 and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into the Loan Documents. Each
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Bank also acknowledges that it will, independently and without reliance upon any
Agent or any other Bank and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents.
Section 10.13. Resignation of Agent;. Subject to the appointment of
a successor Agent, each Agent may resign as Agent for the Banks under this
Agreement and the other Loan Documents at any time by thirty days' notice in
writing to the Banks. Such resignation shall take effect upon appointment of
such successor. The Required Banks shall have the right to appoint a successor
Agent, subject to the prior consent of the Borrowers (which consent shall not be
unreasonably withheld or delayed), who shall be entitled to all of the rights
of, and vested with the same powers as, the original Agent under the Loan
Documents. In the event a successor Agent shall not have been appointed within
the sixty day period following the giving of notice by any Agent, such Agent may
appoint its own successor. Resignation by any Agent shall not affect or impair
the rights of such Agent under Sections 10.5 and 10.10 hereof with respect to
all matters preceding such resignation. Any successor Agent must be either a
Bank or a national banking association or a bank chartered in any State of the
United States, in each case having capital and surplus of not less than
$500,000,000.
Section 10.14. Duration of Agency;. The agency established by
Section 10.1 hereof shall continue, and Sections 10.1 through and including this
Section 10.14 shall remain in full force and effect, until the Notes and all
other amounts due hereunder and thereunder shall have been paid in full and the
Banks' commitments to extend credit to or for the benefit of the Borrowers shall
have terminated or expired.
Section 10.15. Syndication Agent and Co-Agents;. Nothing in this
Agreement shall impose any obligation on Bank of Montreal in its capacity as
Syndication Agent or any Co-Agent.
Section 11. Miscellaneous.
Section 11.1. Amendments and Waivers;. Any term, covenant,
agreement or condition of this Agreement may be amended only by a written
amendment executed by the Borrowers, the Required Banks and, if the rights or
duties of the Administrative Agent are materially affected thereby, the
Administrative Agent, or compliance therewith only may be waived (either
generally or in a particular instance and either retroactively or
prospectively), if the Borrowers shall have obtained the consent in writing of
the Required Banks and, if the rights or duties of the Administrative Agent are
materially affected thereby, the Administrative Agent, provided, however, that
without the consent in writing of the holders of all outstanding Notes and
unpaid Reimbursement Obligations, or all Banks if no Notes or Obligations are
outstanding, no such amendment or waiver shall (i) change the amount or postpone
the date of payment of any scheduled payment or required prepayment of principal
of the Notes or Reimbursement Obligations or extend the term of any L/C at a
time that the Borrowers would not be able to obtain a Loan or L/C hereunder or
reduce the rate or extend the time of payment of interest on the Notes or
Reimbursement Obligations, or reduce the amount of principal thereof, or modify
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any of the provisions of the Notes with respect to the payment or prepayment
thereof, (ii) give to any Note or Reimbursement Obligations any preference over
any other Notes or Reimbursement Obligations, (iii) amend the definition of
Required Banks, (iv) alter, modify or amend the provisions of this Section 11.1,
(v) change the amount or term of any of the Banks' Revolving Credit Commitments
or the fees required under Section 3.2 or the L/C Participation Fee required
under Section 1.5(a) hereof, (vi) alter, modify or amend any Bank's right
hereunder to consent to any action, make any request or give any notice, or
(vii) release any Guarantor of its obligations under the Guaranty Agreement. Any
such amendment or waiver shall apply equally to all Banks and the holders of the
Notes and Reimbursement Obligations and shall be binding upon them, upon each
future holder of any Note and Reimbursement Obligation and upon each Borrower,
whether or not such Note shall have been marked to indicate such amendment or
waiver. No such amendment or waiver shall extend to or affect any obligation not
expressly amended or waived.
Section 11.2. Waiver of Rights;. No delay or failure on the part of
the Administrative Agent or any Bank or on the part of the holder or holders of
any Note or Reimbursement Obligation in the exercise of any power or right shall
operate as a waiver thereof, nor as an acquiescence in any Potential Default or
Event of Default, nor shall any single or partial exercise of any power or right
preclude any other or further exercise thereof, or the exercise of any other
power or right, and the rights and remedies hereunder of the Administrative
Agent, the Banks and of the holder or holders of any Notes are cumulative to,
and not exclusive of, any rights or remedies which any of them would otherwise
have.
Section 11.3. Several Obligations;. The commitments of each of the
Banks hereunder shall be the several obligations of each Bank and the failure on
the part of any one or more of the Banks to perform hereunder shall not affect
the obligation of the other Banks hereunder, provided that nothing herein
contained shall relieve any Bank from any liability for its failure to so
perform. In the event that any one or more of the Banks shall fail to perform
its commitment hereunder, all payments thereafter received by the Administrative
Agent on the principal of Loans and Reimbursement Obligations hereunder, shall
be distributed by the Administrative Agent to the Banks making such additional
Loans ratably as among them in accordance with the principal amount of
additional Loans made by them until such additional Loans shall have been fully
paid and satisfied. All payments on account of interest shall be applied as
among all the Banks ratably in accordance with the amount of interest owing to
each of the Banks as of the date of the receipt of such interest payment.
Section 11.4. Non-Business Day;. If any payment of principal or
interest on any Loan shall fall due on a day which is not a Business Day,
interest at the rate such Loan bears for the period prior to maturity shall
continue to accrue on such principal from the stated due date thereof to and
including the next succeeding Business Day on which the same is payable.
Section 11.5. Documentary Taxes;. The Borrowers agree to pay any
documentary or similar taxes with respect to the Loan Documents, including
interest and penalties, in the event any such taxes are assessed irrespective of
when such assessment is made and whether or not any credit is then in use or
available hereunder.
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Section 11.6. Representations;. All representations and warranties
made herein or in certificates given pursuant hereto shall survive the execution
and delivery of this Agreement and of the Notes, and shall continue in full
force and effect with respect to the date as of which they were made and as
reaffirmed on the date of each borrowing, request for L/C and as long as any
credit is in use or available hereunder.
Section 11.7. Notices;. Unless otherwise expressly provided herein,
all communications provided for herein shall be in writing or by telecopy and
shall be deemed to have been given or made when served personally, when an
answer back is received in the case of notice by telecopy or 3 Business Days
after the date when deposited in the United States mail addressed if to any
Borrower to P.O. Box 388, Yazoo City, Mississippi, 39194, Attention: Corporate
Secretary; if to the Administrative Agent or Harris at 111 West Monroe Street,
Chicago, Illinois 60690, Attention: Agribusiness Group; and if to any of the
Banks, at the address for each Bank set forth under its signature hereon; or at
such other address as shall be designated by any party hereto in a written
notice to each other party pursuant to this Section 11.7.
Section 11.8. Costs and Expenses; Indemnity';. (a) Each Borrower
jointly and severally agrees to pay on demand and upon receipt of supporting
statements, all reasonable costs and expenses of the Administrative Agent, in
connection with the negotiation, preparation, execution and delivery of this
Agreement, the Notes and the other instruments and documents to be delivered
hereunder or in connection with the transactions contemplated hereby, including
the reasonable fees and expenses of Messrs. Chapman and Cutler, special counsel
to the Administrative Agent (such fees and expenses of such special counsel
shall not exceed the amount previously agreed to by Chemical and the
Administrative Agent); all reasonable costs and expenses of the Administrative
Agent, the Banks and any other holder of any Note or any Reimbursement
Obligation (including reasonable attorneys' fees) incurred while any Potential
Default or Event of Default shall have occurred and be continuing, all
reasonable costs and expenses incurred by the Administrative Agent in connection
with any consents or waivers hereunder or amendments hereto, and all reasonable
costs and expenses (including reasonable attorneys' fees), if any, incurred by
the Administrative Agent, the Banks or any other holders of a Note or any
Reimbursement Obligation in connection with the enforcement of this Agreement or
the Notes and the other instruments and documents to be delivered hereunder.
Each Borrower jointly and severally agrees to indemnify and save harmless the
Banks and the Administrative Agent from any and all liabilities, losses,
reasonable costs and expenses incurred by the Banks or the Administrative Agent
in connection with any action, suit or proceeding brought against the
Administrative Agent or any Bank by any Person which arises out of the
transactions contemplated or financed hereby or by the Notes, or out of any
action or inaction by the Administrative Agent or any Bank hereunder or
thereunder, except for such thereof as is caused by the gross negligence or
willful misconduct of the party indemnified.
(b) Without limiting the generality of the foregoing, the Borrowers
jointly and severally unconditionally agree to forever indemnify, defend and
hold harmless, the Agent and each Bank, and covenant not to sue for any claim
for contribution against, the Agent or any Bank for any damages, reasonable
costs, loss or reasonable expense, including without limitation,
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response, remedial or removal costs, arising out of any of the following: (i)
any presence, release, threatened release or disposal of any hazardous or toxic
substance or petroleum by any Borrower or any Subsidiary or otherwise occurring
on or with respect to its Property, (ii) the operation or violation of any
Environmental Law, whether federal, state, or local, and any regulations
promulgated thereunder, by any Borrower or any Subsidiary or otherwise occurring
on or with respect to its Property, (iii) any claim for personal injury or
property damage in connection with any Borrower or any Subsidiary or otherwise
occurring on or with respect to its Property, and (iv) the inaccuracy or breach
of any environmental representation, warranty or covenant by any Borrower made
herein or in any loan agreement, promissory note, mortgage, deed of trust,
security agreement or any other instrument or document evidencing or securing
any indebtedness, obligations or liabilities of any Borrower owing to the Agent
or any Bank or setting forth terms and conditions applicable thereto or
otherwise relating thereto, except for damages arising from the Agent's or such
Bank's willful misconduct or gross negligence. This indemnification shall
survive the payment and satisfaction of all indebtedness, obligations and
liabilities of the Borrowers owing to the Agent and the Banks and the
termination of this Agreement, and shall remain in force beyond the payment or
satisfaction in full of any single claim under this indemnification. This
indemnification shall be binding upon the successors and assigns of each
Borrower and shall inure to the benefit of Agent and the Banks and their
respective directors, officers, employees, agents, and collateral trustees, and
their successors and assigns.
(c) The provisions of this Section 11.8 shall survive payment of the
Notes and Reimbursement Obligations and the termination of the Revolving Credit
Commitments hereunder.
Section 11.9. Counterparts;. This Agreement may be executed in any
number of counterparts and all such counterparts taken together shall be deemed
to constitute one and the same instrument. One or more of the Banks may execute
a separate counterpart of this Agreement which has also been executed by the
Borrowers, and this Agreement shall become effective as and when all of the
Banks have executed this Agreement or a counterpart thereof and lodged the same
with the Administrative Agent.
Section 11.10. Successors and Assigns; Governing Law; Entire
Agreement;. This Agreement shall be binding upon each of the Borrowers, the
Administrative Agent and the Banks and their respective successors and assigns,
and shall inure to the benefit of the Borrowers, the Administrative Agent and
each of the Banks and the benefit of their respective successors and assigns,
including any subsequent holder of any Note or Reimbursement Obligation. This
Agreement and the rights and duties of the parties hereto shall be construed and
determined in accordance with the internal laws of the State of Illinois. This
Agreement constitutes the entire understanding of the parties with respect to
the subject matter hereof and any prior agreements, whether written or oral,
with respect thereto are superseded hereby. The Borrowers may not assign any of
their respective rights or obligations hereunder without the written consent of
the Banks.
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Section 11.11. No Joint Venture;. Nothing contained in this
Agreement shall be deemed to create a partnership or joint venture among the
parties hereto.
Section 11.12. Severability;. In the event that any term or
provision hereof is determined to be unenforceable or illegal, it shall be
deemed severed herefrom to the extent of the illegality and/or unenforceability
and all other provisions hereof shall remain in full force and effect.
Section 11.13. Table of Contents and Headings;. The table of
contents and section headings in this Agreement are for reference only and shall
not affect the construction of any provision hereof.
Section 11.14. Sharing of Payments;. Each Bank agrees with each
other Bank that if such Bank shall receive and retain any payment, whether by
set-off or application of deposit balances or otherwise ("Set-Off"), on any
Loan, Reimbursement Obligation or other amount outstanding under this Agreement
or the other Loan Documents in excess of its ratable share of payments on all
Loans, Reimbursement Obligations and other amounts then outstanding to the
Banks, then such Bank shall purchase for cash at face value, but without
recourse (except for defects in title), ratably from each of the other Banks
such amount of the Loans held by each such other Bank (or interest therein) as
shall be necessary to cause such Bank to share such excess payment ratably with
all the other Banks; provided, however, that if any such purchase is made by any
Bank, and if such excess payment or part thereof is thereafter recovered from
such purchasing Bank, the related purchases from the other Banks shall be
rescinded ratably and the purchase price restored as to the portion of such
excess payment so recovered, but without interest. Each Bank's ratable share of
any such Set-Off shall be determined by the proportion that the aggregate
principal amount of Loans and Reimbursement Obligations and other amounts then
due and payable to such Bank bears to the total aggregate principal amount of
Loans and Reimbursement Obligations and other amounts then due and payable to
all the Banks.
Section 11.15. Jurisdiction; Venue';. Each Borrower hereby submits
to the nonexclusive jurisdiction of the United States District Court for the
Northern District of Illinois and of any Illinois court sitting in Chicago for
purposes of all legal proceedings arising out of or relating to this Agreement
or the transactions contemplated hereby. Each Borrower irrevocably waives, to
the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
Section 11.16. Participants and Note Assignees;. Each Bank shall
have the right at its own cost to grant participations (to be evidenced by one
or more agreements or certificates of participation) in the Loans made, and/or
Reimbursement Obligations, participations in L/Cs and Revolving Credit
Commitment held, by such Bank at any time and from time to time, and to assign
its rights under such Reimbursement Obligations, participations, Loans or the
Notes evidencing such Loans to one or more other Persons; provided that (i) no
such participation or assignment shall relieve any Bank of any of its
obligations under this Agreement, (ii) no such assignee or participant shall
have any rights under this Agreement except as provided in this Section 11.16,
and (iii) the Administrative Agent shall have no obligation or responsibility to
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such participant or assignee, except that nothing herein is intended to affect
the rights of an assignee of a Note to enforce the Note assigned. Any party to
which such a participation or assignment has been granted shall have the
benefits of Section 1.9 and Section 9.3, but shall not be entitled to receive
any greater payment under either such Section than the Bank granting such
participation or assignment would have been entitled to receive in connection
with the rights transferred. Any agreement pursuant to which any Bank may grant
such a participating interest shall provide that such Bank shall retain the sole
right and responsibility to enforce the obligations of the Borrower hereunder,
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; provided that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement that would (A) increase any Revolving
Credit Commitment of such Bank if such increase would also increase the
participant's obligations, (B) forgive any amount of or postpone the date for
payment of any principal of or interest on any Loan or Reimbursement Obligation
or of any fee payable hereunder in which such participant has an interest or
(C) reduce the stated rate at which interest or fees in which such participant
has an interest accrue hereunder.
Section 11.17. Assignment of Commitments by Banks;. Each Bank shall
have the right at any time, with the written consent of the Borrowers and
Administrative Agent (which consent will not be unreasonably withheld) to assign
all or any part of its Revolving Credit Commitment to one or more other Persons;
provided that (i) each such assignment shall be of a constant, and not a
varying, percentage of all such rights and obligations, (ii) unless both parties
to the assignment are Banks immediately prior to giving effect to the
assignment, the amount of the Revolving Credit Commitment of the assigning Bank
being assigned pursuant to each such assignment (determined as of the date of
such assignment) shall not be less than $10,000,000 (or if less, the entire
amount of such Bank's Revolving Credit Commitment, or $1,000,000 if such
assignment is from one Bank to another) and shall be an integral multiple of
$1,000,000, (iii) the parties to each such assignment shall execute and deliver
to the Administrative Agent, for its acceptance and recording, an assignment and
acceptance, together with any Notes subject to such assignment, and (iv) neither
the consent of the Borrowers nor of the Administrative Agent shall be required
for any Bank to assign all or part of its Revolving Credit Commitment to any
affiliate of the assigning Bank or to any Bank; provided further, however, that
each such assigning Bank, unless assigning all of its Revolving Credit
Commitment hereunder and under the First Mississippi Credit Agreement, maintains
a minimum Revolving Credit Commitment hereunder, which, together with its
revolving credit commitment under the First Mississippi Credit Agreement, is not
less than $10,000,000. Upon any such assignment (except any assignment made
pursuant to Sections 1.1(d) or 9.7(b) hereof), its notification to the
Administrative Agent and the payment of a $3,000 recordation fee to the
Administrative Agent, the assignee shall become a Bank hereunder, all Loans and
the Revolving Credit Commitment it thereby holds shall be governed by all the
terms and conditions hereof, and the Bank granting such assignment shall have
its Revolving Credit Commitment, and its obligations and rights in connection
therewith, reduced by the amount of such assignment and Section 1.1(b) hereof
shall be automatically amended, without further action, to reflect the addition
of such assignee as a Bank and the reduction of the Revolving Credit Commitment
of the assignor as described in such assignment.
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Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall be a contract between us for the purposes hereinabove set forth.
Dated as of December 23, 1996.
MISSISSIPPI CHEMICAL CORPORATION
By
---------------------------------------
Its
--------------------------------------
MISSISSIPPI PHOSPHATES CORPORATION
By
---------------------------------------
Its
--------------------------------------
MISSISSIPPI POTASH, INC.
By
---------------------------------------
Its
--------------------------------------
Accepted and Agreed to as of the day and year last above written.
HARRIS TRUST AND SAVINGS BANK
individually and as Administrative Agent
By
---------------------------------------
Its Senior Vice President
Address: 111 West Monroe Street
Chicago, Illinois 60690
Attention: Agribusiness Division
Eurodollar Lending Office:
Nassau Branch
111 West Monroe Street
Chicago, Illinois 60603
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CAISSE NATIONALE DE CREDIT AGRICOLE
By
---------------------------------------
Its
--------------------------------------
By
---------------------------------------
Its
--------------------------------------
Address: 55 East Monroe
Chicago, Illinois 60603-5702
Attention: Mr. Ted Tice
Eurodollar Lending Office:
--------------------------
--------------------------
CIBC INC.
By
---------------------------------------
Its
--------------------------------------
Address: Two Paces West
2227 Paces Ferry Road
Suite 1200
Atlanta, Georgia 30339
Attention: Mr. Bill Humphries
Eurodollar Lending Office:
--------------------------
--------------------------
BANQUE NATIONALE DE PARIS, HOUSTON AGENCY
By
---------------------------------------
Its
--------------------------------------
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Address: 717 North Harwood Street
Suite 2630
Dallas, Texas 75201
Attention: David P. Camp
Eurodollar Lending Office:
-----------------------------
-----------------------------
BANK OF AMERICA ILLINOIS
By
---------------------------------------
Its
--------------------------------------
Address: 1230 Peachtree Street
Suite 3800
Atlanta, Georgia 30309
Attention: Deirdre B. Doyle
Eurodollar Lending Office:
231 South LaSalle Street
Chicago, Illinois 60697
COMMERZBANK AKTIENGESELLSCHAFT,
ATLANTA AGENCY
By
---------------------------------------
Its
--------------------------------------
By
---------------------------------------
Its
--------------------------------------
Address: 1230 Peachtree NE
Atlanta, Georgia 30309
Attention: Mark Wortmann
Eurodollar Lending Office:
-----------------------------
-----------------------------
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BANQUE PARIBAS
By
---------------------------------------
Its
--------------------------------------
Address: 787 Seventh Avenue
29th Floor
New York, New York 10019
Attention: Roger May
Eurodollar Lending Office:
-----------------------------
-----------------------------
THE BANK OF NOVA SCOTIA, ATLANTA AGENCY
By
---------------------------------------
Its
--------------------------------------
Address:
----------------------
----------------------
Attention:
----------------------
Eurodollar Lending Office:
-----------------------------
-----------------------------
SUNTRUST BANK, ATLANTA
By
---------------------------------------
Its
--------------------------------------
By
---------------------------------------
Its
--------------------------------------
Address: 25 Park Place
25th Floor
Atlanta, Georgia 30303
Attention: Greg Cannon
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Eurodollar Lending Office:
-----------------------------
-----------------------------
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By
---------------------------------------
Its
--------------------------------------
Address: 301 South College Street
Fifth Floor
Charlotte, NC 28288-0745
Attention: Tom Bohrer
Eurodollar Lending Office:
-----------------------------
-----------------------------
ABN AMRO BANK N.V.
By
---------------------------------------
Its
--------------------------------------
By
---------------------------------------
Its
--------------------------------------
Address: 1 Ravinia Drive
Suite 1200
Atlanta, Georgia 30346
Attention: Michael VanCranenburgh
Eurodollar Lending Office:
-----------------------------
-----------------------------
THE FUJI BANK, LIMITED
By
---------------------------------------
Its
--------------------------------------
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Address: Suite 2100
The Marquis One Tower
245 Peachtree Center Ave. NE
Atlanta, Georgia 30303
Attention:
--------------------
Eurodollar Lending Office:
----------------------------
----------------------------
THE DAI-ICHI KANGYO BANK, LTD.
By
---------------------------------------
Its
--------------------------------------
Address:
-----------------------
1100 Louisiana Street
Suite 4940
Houston, Texas 77002
Attention: Warren Ross
Eurodollar Lending Office:
-----------------------------
-----------------------------
HIBERNIA NATIONAL BANK
By
---------------------------------------
Its
--------------------------------------
Address: 313 Carondelet
New Orleans, Louisiana 70130
Attention: Trudy Nelson
Eurodollar Lending Office:
-----------------------------
-----------------------------
DEPOSIT GUARANTY NATIONAL BANK
By
---------------------------------------
Its
--------------------------------------
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Address: 210 East Capital
Suite 1180
Jackson, Mississippi 39201
Attention: Stanley A. Herren
Eurodollar Lending Office:
----------------------------
----------------------------
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EXHIBIT 23
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INDEPENDENT AUDITORS' CONSENT
-----------------------------
The Board of Directors
First Mississippi Corporation
We consent to the use of our report dated September 6, 1996, incorporated by
reference herein, with respect to the special-purpose combined balance sheets of
First Mississippi Fertilizer Business to be Merged as of June 30, 1996 and 1995
and the related special-purpose combined statements of operations and cash flows
for each of the years in the three-year period ended June 30, 1996, which report
is included in the Form S-4 of Mississippi Chemical Corporation filed on
November 18, 1996.
KPMG PEAT MARWICK LLP
Jackson, Mississippi
January 3, 1997
