<PAGE> UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-----------------------
FORM 10-Q
(Mark one)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 26, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
-------- --------
Commission File Number 1-8452
-----------------------
THE VONS COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Michigan 38-1623900
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
618 Michillinda Avenue, Arcadia, California 91007
(Address of principal executive offices and zip code)
Registrant's Telephone Number, Including Area Code (818)821-7000
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
-----------------------
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
---- ----
Shares of common stock outstanding at May 3, 1995 - 43,404,230. <PAGE>
<PAGE>
<TABLE>
PART 1. FINANCIAL INFORMATION
Item 1: Financial Statements
THE VONS COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND RETAINED EARNINGS
All amounts except share data in millions of dollars
and as a percentage of sales
(Unaudited)
<CAPTION>
Twelve Weeks Ended
-----------------------------------------------
March 26, 1995 March 27, 1994
-------------------- --------------------
<S> <C> <C> <C> <C>
Sales................................. $ 1,142.5 100.0% $ 1,144.0 100.0%
----------- ------ ----------- ------
Costs and expenses:
Cost of sales, buying and occupancy. 851.0 74.5 857.2 74.9
Selling and administrative expenses. 245.9 21.5 250.6 21.9
Amortization of excess cost over
net assets acquired............... 3.4 .3 3.5 .3
----------- ------ ----------- ------
1,100.3 96.3 1,111.3 97.1
----------- ------ ----------- ------
Operating income...................... 42.2 3.7 32.7 2.9
Interest expense, net................. 16.1 1.4 15.7 1.4
----------- ------ ----------- ------
Income before income tax provision.... 26.1 2.3 17.0 1.5
Income tax provision.................. 12.1 1.1 8.0 .7
----------- ------ ----------- ------
Net income............................ 14.0 1.2 9.0 .8
------ ------
------ ------
Retained earnings - beginning of
period.............................. 207.8 181.2
----------- -----------
Retained earnings - end of period..... $ 221.8 $ 190.2
----------- -----------
----------- -----------
Income per common share:
Net income.......................... $ .32 $ .21
----------- -----------
----------- -----------
Weighted average common shares and
common share equivalents............ 43,753,000 43,475,000
----------- -----------
----------- -----------
<FN>
See accompanying notes to these condensed consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
THE VONS COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
All amounts in millions of dollars
(Unaudited)
ASSETS
<CAPTION>
March 26, January 1,
1995 1995
--------- ----------
<S> <C> <C>
Current assets:
Cash...................................... $ 6.5 $ 9.0
Accounts receivable....................... 36.0 45.4
Inventories............................... 339.7 359.3
Other..................................... 58.7 54.1
--------- ----------
Total current assets.................... 440.9 467.8
Property and equipment, net................. 1,194.6 1,203.0
Excess of cost over net assets acquired..... 494.4 497.8
Other....................................... 56.1 53.4
--------- ----------
TOTAL ASSETS................................ $ 2,186.0 $ 2,222.0
--------- ----------
--------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of capital lease
obligations and long-term debt.......... $ 8.6 $ 8.7
Accounts payable.......................... 277.7 308.4
Accrued liabilities....................... 260.1 246.8
--------- ----------
Total current liabilities............... 546.4 563.9
Accrued self-insurance...................... 113.0 110.9
Deferred income taxes....................... 125.1 121.9
Other noncurrent liabilities................ 71.4 69.1
Senior debt and capital lease obligations... 444.5 484.2
Subordinated debt, net...................... 319.0 319.6
--------- ----------
Total liabilities......................... 1,619.4 1,669.6
--------- ----------
Shareholders' equity:
Common stock.............................. 4.3 4.3
Paid-in capital........................... 340.6 340.4
Retained earnings......................... 221.8 207.8
Notes receivable for stock................ (.1) (.1)
--------- ----------
Total shareholders' equity.............. 566.6 552.4
--------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY.. $ 2,186.0 $ 2,222.0
--------- ----------
--------- ----------
<FN>
See accompanying notes to these condensed consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
THE VONS COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
All amounts in millions of dollars
(Unaudited)
<CAPTION>
Twelve Weeks Ended
-----------------------
March 26, March 27,
1995 1994
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net income.................................................. $ 14.0 $ 9.0
Adjustments to reconcile net income to cash provided
by operating activities:
Depreciation and amortization of property and capital
leases................................................ 23.1 23.3
Amortization of excess cost over net assets acquired
and other assets...................................... 3.6 3.7
Amortization of debt discount and deferred financing
costs................................................. 1.5 1.4
LIFO charge............................................. .8 1.3
Deferred income taxes................................... 6.7 .2
Change in assets and liabilities:
(Increase) decrease in accounts receivable.......... 9.4 (18.8)
(Increase) decrease in inventories at FIFO costs.... 18.8 12.6
(Increase) decrease in other current assets......... (8.1) (4.2)
(Increase) decrease in noncurrent assets............ (1.7) (4.9)
Increase (decrease) in accounts payable............. (16.3) (48.1)
Increase (decrease) in accrued liabilities.......... 13.3 25.3
Increase (decrease) in noncurrent liabilities....... 4.4 (1.2)
--------- ---------
Net cash provided (used) by operating activities.............. 69.5 (.4)
--------- ---------
Cash flows from investing activities:
Addition of property and equipment.......................... (16.7) (31.5)
Disposal of property and equipment.......................... 2.0 1.1
--------- ---------
Net cash used by investing activities......................... (14.7) (30.4)
--------- ---------
Cash flows from financing activities:
Net borrowings (payments) on revolving debt................. (37.9) 24.0
Increase (decrease) in net outstanding drafts............... (14.4) 6.1
Repurchases of senior subordinated debentures............... (1.4) -
Payments on other debt, capital lease obligations and other. (3.6) (1.7)
--------- ---------
Net cash provided (used) by financing activities.............. (57.3) 28.4
--------- ---------
Net cash decrease............................................. (2.5) (2.4)
Cash at beginning of period................................... 9.0 8.5
--------- ---------
Cash at end of period......................................... $ 6.5 $ 6.1
--------- ---------
--------- ---------
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest................................................ $ 8.2 $ 7.7
--------- ---------
--------- ---------
Income taxes............................................ $ .7 $ 3.6
--------- ---------
--------- ---------
Supplemental disclosures of non-cash investing and
financing activity:
Capital leases............................................ $ - $ .3
--------- ---------
--------- ---------
<FN>
See accompanying notes to these condensed consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>
THE VONS COMPANIES,INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The financial data included herein have been prepared by the
Company without audit. In the opinion of management, all
adjustments of a normal recurring nature necessary to present
fairly the Company's consolidated financial position at March 26,
1995 and January 1, 1995 and the consolidated results of
operations and cash flows for the twelve weeks ended March 26,
1995 and March 27, 1994 have been made. This interim information
should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's latest
annual report filed on Form 10-K. Due to seasonality and other
market conditions, the results for the twelve weeks ended
March 26, 1995 should not be considered as indicative of the
results to be expected for a full year.
At March 26, 1995, the Company operated 325 supermarket and
food and drug combination stores, primarily in Southern
California, under the names Vons and Pavilions. During the first
quarter of 1995, the Company executed its decision to exit the
warehouse store format by closing all eight EXPO stores. The
Company also operates a fluid milk processing facility, an ice
cream plant, a bakery, and distribution facilities for meat,
grocery, produce and general merchandise.
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations (Unaudited)
Results of Operations
Twelve Weeks Ended March 26, 1995 Compared with the Twelve Weeks
Ended March 27, 1994
For the majority of 1994, the focus of the Company's
marketing efforts was communicating the lowering of shelf prices
on more than 12,000 items. In 1995, the marketing focus is being
placed on Vons entire customer offering, which combines high
quality products and customer service with competitive prices.
This "Vons Is Value" campaign was introduced in January 1995.
Substantially all of the cost containment and strategic
restructuring initiatives have been executed which included the
closing of 26 stores and the elimination of 700 administrative
and support positions. With the closure of the San Diego
distribution facility in the third quarter of 1995, the cost
containment and strategic restructuring program will be complete.
The Company's marketing focus and its commitment to a low
cost structure are long-term strategies, which are initially
intended to benefit sales by funding lower prices, which in turn
will improve the Company's ability to achieve strong, sustainable
earnings growth.
Sales. First quarter 1995 sales were $1,142.5 million,
which compares with first quarter 1994 sales of $1,144.0 million,
despite 21 fewer stores. Same store sales increased 1.6% over
first quarter 1994 sales. This represents the sixth consecutive
quarter of an improving same store sales trend. Sales were
impacted by reduced prices, the "Vons Is Value" marketing
campaign, competitive new store and remodel activity, and the
slowly improving economic environment in Southern California.
Since March 27, 1994, the Company has opened five stores, closed
26 stores and completed 23 store remodel projects.
Costs and Expenses. Costs and expenses were $1,100.3
million, a decrease of $11.0 million, or 1.0%, from first quarter
1994.
Cost of sales, buying and occupancy expenses as a percentage
of sales decreased by 0.4 percentage points to 74.5% in first
quarter 1995. This reflects decreased product cost achieved
through better utilization of category management, more effective
promotional offerings and increased private brand sales.
Selling and administrative expenses as a percentage of sales
decreased by 0.4 percentage points to 21.5% in first quarter
1995. This decrease reflects the first quarter 1994 insurance
deductible charge of $5.0 million related to the Northridge
earthquake. Excluding this charge, selling and administrative
expenses as a percentage of sales for first quarter 1995 were
flat compared with first quarter 1994. Increased store labor
expenses due to negotiated union wage rate increases were fully
offset by improvements in sales per labor hour and a decrease in
administrative expense. The decrease in administrative expense
primarily reflects the benefits from the reduction in
administrative and support positions as a result of the cost
containment and strategic restructuring program. Advertising
expense also decreased reflecting more efficient media purchases.
Operating Income. First quarter 1995 operating income was
$42.2 million, an increase of $9.5 million over first quarter
1994. Operating margin increased to 3.7% in first quarter 1995
versus 2.9% in first quarter 1994. Excluding the earthquake
insurance deductible charge, operating margin for first quarter
1994 was 3.3%. The increase in first quarter 1995 operating
margin as compared with first quarter 1994 operating margin
excluding the earthquake insurance deductible charge primarily
reflects the increase in gross margin. Operating income before
depreciation and amortization of property, amortization of
goodwill and other assets, LIFO charge and earthquake insurance
deductible ("FIFO EBITDA") was $69.7 million, or 6.1% of sales,
in first quarter 1995 compared with $66.0 million, or 5.8% of
sales, in first quarter 1994.
Interest Expense. First quarter 1995 net interest expense
was $16.1 million, an increase of $.4 million, or 2.5%, over
first quarter 1994. This increase was due to higher average
interest cost on revolving debt partially offset by lower average
debt borrowings.
Income Tax Provision. First quarter 1995 income tax
provision was $12.1 million, or a 46.3% effective tax rate.
First quarter 1994 income tax provision was $8.0 million, or a
47.1% effective tax rate. The decrease in the first quarter 1995
effective tax rate reflects the increase in income before income
tax provision.
Income. First quarter 1995 net income was $14.0 million, or
$.32 per share, compared with $9.0 million, or $.21 per share, in
first quarter 1994. Net income for first quarter 1994 includes a
$5.0 million, or $.07 per share, insurance deductible charge
related to the Northridge earthquake.
Liquidity and Capital Resources
The Company's primary sources of liquidity are cash flows
from operations and available credit under its revolving debt.
On February 17, 1995, the Company replaced its $475 million
Revolving Credit Facility and related $150 million Term Loan
Facility with a $625 million Revolving Loan Agreement (the
"Revolving Loan"). Management believes that these sources
adequately provide for its working capital, capital expenditure
and debt service needs.
Net cash provided by operating activities was $69.5 million
in first quarter 1995 compared with net cash used by operating
activities of $.4 million in first quarter 1994. This increase
was due primarily to an increase in net income and changes in
assets and liabilities generally reflecting the timing of
receipts and disbursements. The ratio of current assets to
current liabilities was 0.81 to 1 at March 26, 1995 compared with
0.83 to 1 at January 1, 1995.
Net cash used by investing activities was $14.7 million in
first quarter 1995 compared with $30.4 million in first quarter
1994. The Company opened one store, closed ten stores and
completed ten store remodel projects during the twelve weeks
ended March 26, 1995. The Company anticipates that total 1995
capital expenditures will be approximately $175 million of which
approximately $155 million will be cash capital expenditures.
Capital expenditures in 1995 have been and will continue to be
funded out of cash provided by operations, the Revolving Loan
and/or through operating leases. The capital expenditure
programhas substantial flexibility and is subject to revision
based on various factors including, but not limited to, business
conditions, changing time constraints, cash flow requirements and
competitive factors. In the near term, if the Company were to
reduce substantially or postpone these programs, there would be
no substantial impact on current operations and it is likely that
more cash would be available for debt servicing. In the long
term, if these programs were substantially reduced, in the
Company's opinion, its operating business and ultimately its cash
flow would be adversely impacted.
Net cash used by financing activities was $57.3 million in
first quarter 1995 compared with net cash provided by financing
activities of $28.4 million in first quarter 1994. The level of
borrowings under the Company's revolving debt is dependent
primarily upon net cash provided by operating activities, long-
term borrowing activity and capital requirements. In first
quarter 1995, the Company repurchased $1.5 million of senior
subordinated debt.
At March 26, 1995, the Company's revolving debt borrowings
totaled $261.9 million compared with the March 27, 1994 revolving
debt borrowings of $241.7 million. This change reflects the
replacement of the $150 million Term Loan Facility and borrowings
relating to the capital expenditure program offset by increased
income from operations and net payments on debt. At March 26,
1995, the Company had available unused credit of $289.2 million
under its Revolving Loan. For the twelve weeks ended March 26,
1995, the weighted average interest cost on revolving debt was
7.7%; the corresponding bank prime rate at March 26, 1995 was
9.0%.
<PAGE>
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Not applicable.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
10.1.6 Revolving Loan Agreement dated
February 17, 1995 by and among the
Registrant, the banks named therein, and
Bank of America NT & SA and The Chase
Manhattan Bank, N.A. as managing agents.
27 Financial Data Schedule.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the
quarter ended March 26, 1995.
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
THE VONS COMPANIES, INC.
Date: May 3, 1995 /s/ LAWRENCE A. DEL SANTO
-- -----------------------------------
Lawrence A. Del Santo
Chairman and Chief
Executive Officer
Date: May 3, 1995 /s/ PAMELA K. KNOUS
-- -----------------------------------
Pamela K. Knous
Senior Vice President
Chief Financial Officer
Exhibit 10.1.6
REVOLVING LOAN AGREEMENT
Dated as of February 17, 1995
among
THE VONS COMPANIES, INC.
THE BANKS HEREIN NAMED
THE BANK OF NOVA SCOTIA
CITICORP USA, INC.
NATIONSBANK OF TEXAS, N.A.,
as Co-Agents
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
as Documentation Agent
and
THE CHASE MANHATTAN BANK, N.A.,
as Administrative Agent
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS................. 1
1.1 Defined Terms.................................... 1
1.2 Use of Defined Terms............................. 29
1.3 Accounting Terms................................. 30
1.4 Rounding......................................... 30
1.5 Miscellaneous Terms.............................. 30
1.6 Exhibits and Schedules........................... 30
1.7 Subsidiaries..................................... 30
ARTICLE 2 LOANS AND LETTERS OF CREDIT...................... 32
2.1 Loans-General.................................... 32
2.2 Alternate Base Rate Loans........................ 33
2.3 Eurodollar Rate Loans............................ 33
2.4 Commercial Letters of Credit..................... 34
2.5 Standby Letters of Credit........................ 37
2.6 Mandatory Reduction of the Commitment............ 39
2.7 Voluntary Reduction of the Commitment............ 39
2.8 Involuntary Termination of the Commitment........ 39
2.9 Administrative Agent's Right to Assume Funds
Available........................................ 39
2.10 Swing Line....................................... 40
2.11 Extension of Maturity Date....................... 41
ARTICLE 3 PAYMENTS; FEES................................... 43
3.1 Principal and Interest........................... 43
3.2 Administration Fees.............................. 44
3.3 Syndication Fees................................. 44
3.4 Documentation Fees............................... 44
3.5 Upfront Fees..................................... 45
3.6 Commitment Fees.................................. 45
3.7 Letter of Credit Fees............................ 45
3.8 Increased Commitment Costs....................... 46
3.9 Eurodollar Fees.................................. 47
3.10 Eurodollar Costs................................. 47
3.11 Special Eurodollar Circumstances................. 48
3.12 Indemnification.................................. 49
3.13 Late Payments.................................... 49
3.14 Computation of Interest and Fees................. 49
3.15 Holidays......................................... 49
3.16 Payment Free of Taxes............................ 50
3.17 Funding Sources.................................. 51
3.18 Failure to Charge Not Subsequent Waiver.......... 51
3.19 Pro Rata Treatment............................... 51
3.20 Time and Place of Payments; Evidence of Payments. 51
3.21 Administrative Agent's Right to Assume
Payments Will be Made............................ 51
3.22 Survivability.................................... 52
ARTICLE 4 REPRESENTATIONS AND WARRANTIES................... 53
4.1 Existence and Qualification; Power; Compliance
with Law......................................... 53
4.2 Authority; Compliance with Other Instruments
and Government Regulations....................... 53
4.3 No Governmental Approvals Required............... 54
4.4 Subsidiaries..................................... 54
4.5 Financial Statements............................. 55
4.6 No Other Liabilities; No Material Adverse Effect. 55
4.7 Title to Assets.................................. 56
4.8 Intangible Assets................................ 56
4.9 Existing Indebtedness and Guaranty Obligations... 56
4.10 Governmental Regulation.......................... 56
4.11 Litigation....................................... 56
4.12 Employee Matters................................. 57
4.13 Binding Obligations.............................. 57
4.14 No Default....................................... 57
4.15 Pension Plans.................................... 57
4.16 Tax Liability.................................... 57
4.17 Regulation U..................................... 57
4.18 Disclosure....................................... 58
4.19 Projections...................................... 58
4.20 Hazardous Materials.............................. 58
ARTICLE 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION
AND REPORTING REQUIREMENTS)...................... 60
5.1 Payment of Taxes and Other Potential Liens....... 60
5.2 Preservation of Existence........................ 60
5.3 Maintenance of Properties........................ 61
5.4 Maintenance of Insurance......................... 61
5.5 Compliance with Laws............................. 61
5.6 Inspection Rights................................ 61
5.7 Keeping of Records and Books of Account.......... 61
5.8 Use of Proceeds.................................. 61
5.9 Subsidiary Guaranty.............................. 62
5.10 Maintenance of Borrower Net Assets............... 62
ARTICLE 6 NEGATIVE COVENANTS............................... 63
6.1 Payment or Prepayment of Subordinated
Obligations...................................... 63
6.2 Dispositions..................................... 63
6.3 Mergers and Sale of Assets....................... 63
6.4 Investments and Acquisitions..................... 64
6.5 ERISA Compliance................................. 65
6.6 Change in Business............................... 65
6.7 Liens and Negative Pledges....................... 65
6.8 Sales and Leasebacks............................. 66
6.9 Indebtedness..................................... 67
6.10 Guaranty Obligations............................. 68
6.11 Subsidiary Indebtedness and Guaranty
Obligations...................................... 69
6.12 Transactions with Affiliates..................... 69
6.13 Leverage Ratio................................... 69
6.14 Minimum Shareholders' Equity..................... 69
6.15 Fixed Charge Coverage Ratio...................... 70
6.16 Capital Expenditures............................. 70
6.17 Distributions.................................... 70
6.18 Amendments....................................... 70
6.19 Change of Fiscal Year............................ 70
6.20 Hostile Tender Offers............................ 70
ARTICLE 7 INFORMATION AND REPORTING REQUIREMENTS........... 71
7.1 Financial and Business Information............... 71
7.2 Compliance Certificate........................... 73
ARTICLE 8 CONDITIONS....................................... 75
8.1 Initial Advances, etc............................ 75
8.2 Any Increasing Advance, etc...................... 76
8.3 Any Advance...................................... 77
ARTICLE 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENTS OF
DEFAULT.......................................... 78
9.1 Events of Default................................ 78
9.2 Remedies Upon Event of Default................... 80
ARTICLE 10 THE ADMINISTRATIVE AGENT......................... 84
10.1 Appointment and Authorization.................... 84
10.2 Administrative Agent and Affiliates.............. 84
10.3 Banks' Credit Decisions.......................... 84
10.4 Action by Administrative Agent................... 85
10.5 Liability of Administrative Agent................ 86
10.6 Indemnification.................................. 87
10.7 Successor Administrative Agent................... 88
10.8 No Obligations of Borrower....................... 88
10.9 No Obligations-Managing Agents................... 88
ARTICLE 11 MISCELLANEOUS.................................... 89
11.1 Cumulative Remedies; No Waiver................... 89
11.2 Amendments; Consents............................. 89
11.3 Costs, Expenses and Taxes........................ 90
11.4 Nature of Banks' Obligations..................... 91
11.5 Representations and Warranties................... 91
11.6 Notices.......................................... 91
11.7 Execution in Counterparts........................ 92
11.8 Binding Effect; Assignment....................... 92
11.9 Sharing of Setoffs............................... 95
11.10 Indemnity by Borrower............................ 96
11.11 Nonliability of Banks............................ 97
11.12 Confidentiality.................................. 97
11.13 No Third Parties Benefited....................... 98
11.14 Right of Setoff - Deposit Accounts............... 98
11.15 Further Assurances............................... 98
11.16 Integration...................................... 99
11.17 Governing Law.................................... 99
11.18 Choice of Forum.................................. 99
11.19 Severability of Provisions....................... 99
11.20 Headings......................................... 99
11.21 Time of the Essence.............................. 99
11.22 Conflict in Loan Documents.......................100
11.23 Removal of a Bank................................100
11.24 Waiver of Right to Trial by Jury.................100
11.25 Purported Oral Amendments........................101
Schedules
- ---------
1.1 Pro Rata Shares
2.5 Initial Letters of Credit
4.4 Subsidiaries
4.7 Existing Liens and Rights of Others
4.9 Existing Indebtedness and Guaranty Obligations
4.15 Pension Plans
4.20 Environmental Matters
6.4 Existing Investments
Exhibits
- --------
A - Commitment Assignment and Acceptance
B - Compliance Certificate
C - Note
D - Opinion of Counsel
E - Request for Letter of Credit
F - Request for Loan
G - Subsidiary Guaranty
H - Uncommitted Money Market Facility
REVOLVING LOAN AGREEMENT
------------------------
Dated as of February 17, 1995
This Revolving Loan Agreement ("Agreement") is entered
into by and among The Vons Companies, Inc., a Michigan
corporation ("Borrower"), each bank signatory hereto as set forth
on the signature pages of this Agreement and any Eligible
Assignee which may hereafter execute and deliver a Commitment
Assignment and Acceptance that is registered with the
Administrative Agent pursuant to Section 11.8 (collectively, the
----
"Banks" and individually, a "Bank"), The Bank of Nova Scotia,
Citicorp USA, Inc. and NationsBank of Texas, N.A., as Co-Agents,
Bank of America National Trust and Savings Association, as
Documentation Agent, and The Chase Manhattan Bank, N.A.,
as Administrative Agent (collectively, with the Documentation
Agent, the "Managing Agents").
In consideration of the mutual covenants and
agreements herein contained, the parties hereto covenant and
agree as follows:
ARTICLE 1
DEFINITIONS AND ACCOUNTING TERMS
--------------------------------
1.1 Defined Terms. As used in this Agreement, the
-------------
following terms shall have the meanings set forth respectively
after each:
"Acquisition" means any transaction, or any series of
-----------
related transactions, consummated after the Closing Date,
by which Borrower and/or any of its Subsidiaries directly
or indirectly (a) acquires any ongoing business or all or
substantially all of the assets of any firm, corporation
or division thereof engaged in an ongoing business,
whether through purchase of assets, merger or otherwise,
(b) acquires control of securities of a corporation
engaged in an ongoing business representing 50% or more of
the ordinary voting power for the election of directors or
(c) acquires control of a 50% or more ownership interest
in any partnership, joint venture or other business entity
engaged in an ongoing business.
"Adjusted EBITDA" means, for any fiscal period,
---------------
Consolidated Income Before Extraordinary Items for that
fiscal period, plus (a) Interest Expense for that fiscal
----
period, (b) the amount of any provision for taxes on or
measured by income charged against revenues to arrive at
Consolidated Income Before Extraordinary Items for that
fiscal period, (c) depreciation and amortization of
property and capital leases for that fiscal period,
(d) amortization of excess cost over net assets acquired
and other assets for that fiscal period, (e) the amount,
if any, of any LIFO provision charged against revenues to
arrive at Consolidated Income Before Extraordinary Items
for that fiscal period and (f) any Defined Non-Recurring
Charges for that fiscal period, and minus (y) the amount,
-----
if any, of any LIFO provision credited to Consolidated
Income Before Extraordinary Items for that fiscal period
and (z) the net income of any Subsidiary of Borrower for
that fiscal period to the extent that Distributions by
such Subsidiary are not permitted by any Contractual
Obligation or Requirement of Law applicable to such
Subsidiary, all determined in accordance with Generally
Accepted Accounting Principles consistently applied.
"Administrative Agent" means The Chase Manhattan
--------------------
Bank, N.A. as administrative agent for the Banks hereunder
and under the other Loan Documents, and each successor
administrative agent.
"Administrative Agent's Office" means 4 Chase
-----------------------------
Metrotech Center, 13th Floor, Brooklyn, New York 11245,
or such other office as the Administrative Agent may
designate in writing to Borrower and the Banks.
"Advance" means an advance made or to be made to
-------
Borrower by a Bank pursuant to Article 2.
---------
"Affiliate" means, as to any Person, any other Person
---------
which directly or indirectly controls, or is under common
control with, or is controlled by, such Person. As used
in this definition, "control" (including, with its
correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or
indirectly, of power to direct or cause the direction of
management or policies (whether through ownership of
securities or partnership or other ownership interests, by
contract or otherwise); provided that, in any event, any
--------
Person which owns directly or indirectly 10% or more of
the securities having ordinary voting power for the
election of directors or other governing body of a
corporation that has more than 100 record holders of such
securities or 10% or more of the partnership or other
ownership interests of any other Person that has more than
100 record holders of such interests will be deemed to
control such corporation or other Person.
"Agreement" means this Loan Agreement, either as
---------
originally executed or as it may from time to time be
supplemented, modified, amended, renewed, extended or
supplanted.
"Alternate Base Rate" means, as of any date of
-------------------
determination, the rate per annum (rounded upwards, if
necessary, to the next 1/100 of 1%) equal to the higher
------
of (a) the Prime Rate in effect on such date and (b) the
--
Federal Funds Rate in effect on such date plus 1/2 of 1%
(50 basis points).
"Alternate Base Rate Loan" means a Loan made
------------------------
hereunder and specified to be an Alternate Base Rate Loan
in accordance with Article 2.
---------
"Alternate Base Rate Period" means, as to each
--------------------------
Alternate Base Rate Loan, the period commencing on the
date specified by Borrower pursuant to Section 2.1(b) and
------
ending on the first Quarterly Payment Date thereafter;
provided that (a) the first day of any Alternate Base Rate
--------
Period shall be a Banking Day; (b) any Alternate Base Rate
Period that would otherwise end on a day that is not a
Banking Day shall be extended to the next succeeding
Banking Day; and (c) no Alternate Base Rate Period
shall extend beyond the Maturity Date.
"Applicable Commitment Fee Rate" means, for each
------------------------------
Pricing Period, the rate set forth below (expressed in
basis points) opposite the Applicable Pricing Level for
that Pricing Period:
Pricing Level Rate
------------- ----
I 15.00
II 20.00
III 25.00
IV 31.25
"Applicable Eurodollar Rate Margin" means, for each
---------------------------------
Pricing Period, the interest rate margin set forth below
(expressed in basis points) opposite the Applicable
Pricing Level for that Pricing Period:
Pricing Level Margin
------------- ------
I 43.75
II 50.00
III 62.50
IV 75.00
"Applicable Standby Letter of Credit Fee Rate" means,
--------------------------------------------
for each Pricing Period, the rate set forth below
(expressed in basis points) opposite the Applicable
Pricing Level for that Pricing Period:
Pricing Level Rate
------------- ----
I 33.75
II 40.00
III 52.50
IV 65.00
"Applicable Pricing Level" means, for each Pricing
------------------------
Period, the pricing level set forth below opposite the
pricing criteria achieved by Borrower as of the first day
of that Pricing Period (and, if such pricing criteria are
set forth opposite different pricing levels, then the
pricing level set forth below that is more favorable to
Borrower):
Level Pricing Criteria
----- ---------------------------------
Interest Senior
Coverage Ratio Debt Rating
-------------- -----------
I Equal to or At least
greater than 4.25 BBB or
to 1.00 Baa2
II Equal to or
greater than 3.75 BBB- or
to 1.00 but less Baa3
than 4.25 to 1.00
III Equal to or BB+ or
greater than 3.00 Ba1
to 1.00 but less
than 3.75 to 1.00
IV Less than 3.00 to Below
1.00 BB+ or
Ba1
"Bank" means any of the banks signatory to this
----
Agreement, their successors and, upon the effective date
after registration with the Administrative Agent pursuant
to Section 11.8 of a Commitment Assignment and Acceptance
----
executed by an Eligible Assignee, such Eligible Assignee.
"Banking Day" means any Monday, Tuesday, Wednesday,
-----------
Thursday, or Friday other than a day on which banks are
----------
authorized or required to be closed in California or
New York.
"Borrower" means The Vons Companies, Inc., a Michigan
--------
corporation, and its successors and permitted assigns.
"Capital Expenditure" means any expenditure that is
-------------------
considered a capital expenditure under Generally Accepted
Accounting Principles, including any amount which is
required to be treated as an asset subject to a Capital
Lease.
"Capital Indebtedness" means, as of any date of
--------------------
determination, the sum of (a) all Indebtedness of Borrower
and its Subsidiaries for borrowed money (including Capital
---------
Leases) or for the deferred purchase price of Property or
services (other than trade or other accounts payable in
----------
the ordinary course of business in accordance with
customary industry terms), in either case that should be
reflected in a consolidated balance sheet of Borrower and
its Subsidiaries prepared in accordance with Generally
Accepted Accounting Principles as of that date, plus
----
(b) the aggregate direct and contingent obligations of
Borrower and its Subsidiaries under all letters of credit
outstanding on that date for which Borrower or any
of its Subsidiaries is the account party plus (c) the
----
aggregate net obligations of Borrower and its Subsidiaries
under all Swap Agreements outstanding on that date to
which Borrower or any of its Subsidiaries is a party. For
purposes of this definition, "net obligations" under a
Swap Agreement as of any date means the amount it would
cost Borrower or its Subsidiary on that date to terminate
or fully offset its further obligations under that Swap
Agreement, as determined by Borrower based on a written
quotation from its counter party under that Swap Agreement
(in the case of a termination) or from any financially
responsible financial institution (in the case of a full
offset).
"Capital Lease" means, as to any Person, a lease of
-------------
any Property by that Person as lessee that is, or should
be in accordance with Financial Accounting Standards Board
Statement No. 13, recorded as a "capital lease" on a
balance sheet of that Person prepared in accordance with
Generally Accepted Accounting Principles.
"Cash" means all monetary items (including currency,
---- ---------
coin and bank demand deposits) that are treated as cash
under Generally Accepted Accounting Principles.
"Cash Equivalents" means, when used in connection
----------------
with any Person, the Person's Investments in:
(a) Government Securities due within one year
of the making of the Investment;
(b) readily marketable direct obligations of
any state of the United States of America or any
political subdivision of any such state given on the
date of such Investment a credit rating of at least
Aa by Moody's Investors Service, Inc. or AA by
Standard & Poor's Ratings Group (a division of
McGraw-Hill, Inc.), in each case due within one year
after the date of the making of the Investment;
(c) certificates of deposit issued by, deposits
in, bankers' acceptances of, and repurchase
agreements covering Government Securities executed
by, any Bank or any other bank doing business in and
incorporated under the Laws of the United States of
America or any state thereof and having on the date
of such Investment combined capital, surplus and
undivided profits of at least $500,000,000 and which
carries on the date of such Investment a credit
rating of P-2 or higher by Moody's Investors Service,
Inc. or A-2 or higher by Standard & Poor's Ratings
Group (a division of McGraw-Hill, Inc.), or
certificates of deposit issued by, deposits in,
bankers' acceptances of, and repurchase agreements
covering Government Securities executed by a
wholly-owned Subsidiary of any Bank or any such bank,
in each case due within one year after the date of
the making of the Investment;
(d) certificates of deposit issued by, bank
deposits in, eurodollar deposits through, bankers'
acceptances of, and reverse repurchase agreements
covering Government Securities executed by, any
branch or office located in the United States of
America of a bank incorporated under the Laws of any
jurisdiction outside the United States of America
having on the date of such Investment combined
capital, surplus and undivided profits of at least
$3,000,000,000, in each case due within one year
after the date of the making of the Investment;
(e) reverse repurchase agreements covering
Government Securities executed by a broker or dealer
registered under Section 15(b) of the Securities
Exchange Act of 1934 having on the date of such
Investment capital of at least $100,000,000, due
within 15 Banking Days after the date of the making
of the Investment; provided that Borrower receives
--------
written confirmation of the transfer to it of record
ownership of the Government Securities on the books
of a "primary dealer" in such Government Securities
as soon as practicable after the making of the
Investment;
(f) readily marketable commercial paper of
corporations doing business in and incorporated under
the Laws of the United States of America or any state
thereof given on the date of such Investment a credit
rating of P-2 or higher by Moody's Investors Service
Inc. or A-2 or higher by Standard & Poor's Ratings
Group (a division of McGraw-Hill, Inc.), in each case
due within one year of the making of the Investment;
and
(g) the "Merrill Lynch Ready Assets Trust", so
long as it does not materially alter the investment
policies maintained by it as of the Closing Date and
any other money market fund having total assets of
$2,000,000,000 or more that has investment policies
not less financially conservative in any material
respect than the investment policies of the
Merrill Lynch Ready Assets Trust, so long as such
fund does not materially alter such policies.
"Cash Fixed Charges" means, as of the last day of any
------------------
fiscal period, (a) Interest Expense for that fiscal period
(excluding amortization of debt discount and deferred
---------
financing costs), plus (b) Rental Expense for that fiscal
----
period, plus (c) any Distributions made by Borrower during
----
that fiscal period.
"Change in Control" means any transaction or series
-----------------
of related transactions (a) in which any Person or two or
more Persons acting in concert acquire beneficial
ownership (within the meaning of Rule 13d-3 of the
Commission under the Securities Exchange Act of 1934, as
amended), directly or indirectly, of 50% or more of the
Common Stock, (b) in which any such Person or Persons
acquire beneficial ownership of 30% or more of the Common
Stock subsequent to the Closing Date and (i) at the first
election for the board of directors of Borrower subsequent
to such acquisition, individuals who prior to such
election were directors of Borrower cease for any reason
(other than death or incapacity) to constitute 50% or more
----- ----
of the board of directors of Borrower or (ii) if the terms
of all directors of Borrower do not expire at the date of
such first election, then at the second election for the
board of directors of Borrower subsequent to such
acquisition, individuals who prior to such first election
were directors of Borrower cease for any reason (other
-----
than death or incapacity) to constitute 50% or more of the
----
board of directors of Borrower or (c) constituting a
"change in control" or other similar occurrence under
documentation evidencing or governing any Indebtedness of
Borrower of $15,000,000 or more which results in an
obligation of Borrower to prepay, purchase, offer to
purchase, redeem or defease such Indebtedness.
"Closing Date" means the time and Banking Day on
------------
which the conditions set forth in Section 8.1 are
---
satisfied or waived pursuant to Section 11.1.
----
"Code" means the Internal Revenue Code of 1986, as
----
amended or replaced and as in effect from time to time.
"Commercial Letter of Credit" means any commercial
---------------------------
letter of credit issued by the Issuing Bank pursuant to
Section 2.4, in the standard form for commercial letters
---
of credit of the Issuing Bank, either as originally issued
or as the same may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.
"Commission" means the Securities and Exchange
----------
Commission and any successor commission.
"Commitment" means, subject to Sections 2.6, 2.7
---------- --- ---
and 2.8, $625,000,000. The respective Pro-Rata Shares of
---
the Banks with respect to the Commitment are set forth in
Schedule 1.1.
------------
"Commitment Assignment and Acceptance" means a
------------------------------------
Commitment Assignment and Acceptance executed by a Bank
and an Eligible Assignee substantially in the form of
Exhibit A and registered with the Administrative Agent
---------
pursuant to Section 11.8.
----
"Common Stock" means the $.10 par value common stock
------------
of Borrower.
"Compliance Certificate" means a compliance
----------------------
certificate in the form of Exhibit B signed, on behalf of
---------
Borrower, by a Senior Officer of Borrower.
"Consolidated Income Before Extraordinary Items"
----------------------------------------------
means, with respect to any fiscal period, the consolidated
income before extraordinary items of Borrower and its
Subsidiaries for that fiscal period, determined in
accordance with Generally Accepted Accounting Principles
consistently applied.
"Consolidated Net Income" means, with respect to any
-----------------------
fiscal period, the consolidated net income of Borrower and
its Subsidiaries for that fiscal period, determined in
accordance with Generally Accepted Accounting Principles
consistently applied.
"Consolidated Total Assets" means, as of any date of
-------------------------
determination, the consolidated total assets that should
be reflected as such on a consolidated balance sheet of
Borrower and its Subsidiaries on that date prepared in
accordance with Generally Accepted Accounting Principles.
"Contractual Obligation" means, as to any Person, any
----------------------
provision of any outstanding Securities issued by that
Person or of any material agreement, instrument or
undertaking to which that Person is a party or by which it
or any of its Property is bound, other than, in the case
----------
of Borrower and its Subsidiaries, any of the Loan
Documents.
"Co-Agents" has the meaning set forth in the
---------
introduction to this Agreement. The Co-Agents shall have
no duties or responsibilities under this Agreement beyond
those of a Bank.
"Debtor Relief Laws" means the Bankruptcy Code of the
------------------
United States of America, as amended from time to time,
and all other applicable liquidation, conservatorship,
insolvency, reorganization, or similar debtor relief Laws
from time to time in effect affecting the rights of
creditors generally.
"Default" means any event that, with the giving of
-------
notice or passage of time or both, would be an Event of
Default.
"Default Rate" means the interest rate described in
------------
Section 3.13.
----
"Defined Non-Recurring Charge" means, with respect to
----------------------------
any fiscal period, any charge made to Consolidated Income
Before Extraordinary Items during that fiscal period
(a) relating to the effect of the January, 1994
"Northridge" earthquake, to the extent reflected in the
financial statements of Borrower for the Fiscal Quarter
ended October 9, 1994 or prior thereto, as furnished to
the Banks as of the Closing Date, (b) relating to the
effect of the restructuring of Borrower that occurred in
the Fiscal Quarter ended October 9, 1994, to the extent
reflected in the financial statements of Borrower for the
Fiscal Quarter ended October 9, 1994 or prior thereto, as
furnished to the Banks as of the Closing Date, or (c) that
does not, when aggregated with all such charges made
subsequent to October 9, 1994, exceed $15,000,000.
"Designated Deposit Account" means a deposit account
--------------------------
to be maintained by Borrower with the Administrative
Agent, as from time to time designated by Borrower by
written notification to the Administrative Agent.
"Designated Eurodollar Market" means, for any
----------------------------
Eurodollar Rate Loan, the Eurodollar Market(s) designated
solely by each of the Reference Banks to be the
appropriate Eurodollar Market for that Eurodollar Rate
Loan.
"Designated Eurodollar Market Day" means any Banking
--------------------------------
Day on which the Reference Banks accept deposits in the
Designated Eurodollar Market.
"determined solely by the Administrative Agent"
---------------------------------------------
means, with respect to any calculation relating to
interest, fees or other charges under this Agreement, a
calculation made solely by the Administrative Agent using
a method that is commonly used by the Administrative Agent
and by other banks in performing similar calculations in
similar transactions, which method may not necessarily be
that which yields the most favorable result to Borrower.
"Disposition" means the sale, transfer or other
-----------
disposition of fixed assets of Borrower or any of its
Subsidiaries (whether directly or indirectly through the
sale, transfer or other disposition of all or
substantially all of the capital stock of a Subsidiary of
Borrower that holds fixed assets) other than the sale,
----------
transfer or other disposition of (a) any fixed asset in a
transaction consisting of a lease, lease assignment or
sublease thereof in the ordinary course of business,
(b) any fixed asset in a transaction where the aggregate
fair market value of all fixed assets sold, transferred or
disposed of in that transaction is less than $2,000,000
and (c) fixed assets to a wholly-owned Subsidiary of
Borrower, from a wholly-owned Subsidiary of Borrower to
Borrower or between wholly-owned Subsidiaries of Borrower.
If a Disposition occurs as part of a transaction in which
assets of Borrower or any of its Subsidiaries other than
fixed assets are sold, transferred or disposed of, the
portion of the aggregate sales consideration payable in
such transaction allocated to fixed assets for the
purposes of this Agreement shall not be less than the fair
market value thereof.
"Distribution" means, with respect to any shares of
------------
capital stock or any warrant or right to acquire shares of
capital stock or any other equity security issued by a
Person, (a) the retirement, redemption, purchase, or other
acquisition for value by such Person of any such security,
(b) the declaration or (without duplication) payment by
such Person of any dividend in Cash or in Property (other
than common stock of such Person) on or with respect to
any such security, (c) any Investment by such Person in
the holder of 5% or more of any such security if a purpose
of such Investment is to avoid characterization of the
transaction as a Distribution, and (d) any other payment
by such Person constituting a distribution under
applicable Laws with respect to such security.
"Documentation Agent" means Bank of America National
-------------------
Trust and Savings Association, as documentation agent for
the Banks hereunder and under the other Loan Documents,
and each successor documentation agent. The Documentation
Agent shall arrange for the documentation of this
Agreement and the other Loan Documents through and
including the Closing Date, but shall have no other duties
or responsibilities beyond those of a Bank hereunder. The
Documentation Agent shall be entitled to the benefits
accorded by Article 10 to the Administrative Agent,
----------
mutatis mutandis.
------- --------
"Dollars" or "$" means the national currency of the
-------
United States of America.
"Eligible Assignee" means (a) with respect to any
-----------------
Bank, any Affiliate of that Bank, (b) any other Person
(including any Bank) approved in writing by Borrower,
---------
which approval may be withheld in the sole, absolute and
unfettered discretion of Borrower and (c) during the six
(6) month period immediately following a Change of
Control, and only during such period, any financial
institution approved in writing by Borrower, which
approval shall not be unreasonably withheld. As of the
Closing Date, Borrower does not contemplate that it will
approve other Persons to be an Eligible Assignee pursuant
to clause (b).
"ERISA" means, at any date, the Employee Retirement
-----
Income Security Act of 1974 and the regulations
thereunder, all as the same shall be in effect at such
date.
"ERISA Affiliate" means, with respect to any Person,
---------------
any other Person (or any trade or business, whether or not
incorporated) that is under common control with that
Person within the meaning of Section 414 of the Code.
"Eurodollar Market" means a regular established
-----------------
market located within or without the United States of
America by and among banks for the solicitation, offer and
acceptance of Dollar deposits in such banks.
"Eurodollar Period" means, as to each Eurodollar Rate
-----------------
Loan, a period of 1, 2, 3 or 6 months, as designated by
Borrower; provided that (a) the first day of each
--------
Eurodollar Period must be a Designated Eurodollar Market
Day, (b) any Eurodollar Period that would otherwise end on
a day that is not a Designated Eurodollar Market Day shall
be extended to the next succeeding Designated Eurodollar
Market Day, unless such Designated Eurodollar Market Day
falls in the next calendar month, in which case the
Eurodollar Period shall end on the next preceding
Designated Eurodollar Market Day, and (c) no Eurodollar
Period may extend beyond the Maturity Date.
"Eurodollar Rate" means, for each Eurodollar Rate
---------------
Loan, an annual rate, determined solely by the
Administrative Agent, consisting of the average (rounded
upward to the nearest 1/100 of 1%) of the rates offered to
each Reference Bank by prime banks for deposits of
immediately available Dollars in the Designated Eurodollar
Market at or about 11:00 a.m., local time in the
Designated Eurodollar Market, on the day two Designated
Eurodollar Market Days preceding the first day of the
applicable Eurodollar Period for approximately the same
time period as the applicable Eurodollar Period and in an
amount approximately equal to that Eurodollar Rate Loan.
"Eurodollar Rate Loan" means a Loan made hereunder
--------------------
and designated as a Eurodollar Rate Loan in accordance
with Section 2.1(b).
------
"Eurodollar Reserve Percentage" means, for each
-----------------------------
Eurodollar Rate Loan, that percentage, determined solely
by the Administrative Agent, representing the maximum
aggregate incremental reserve requirements of any of the
Reference Banks (disregarding any offsetting amounts that
may be available to such Reference Bank to decrease such
requirements to the extent that such offsetting amounts
arose under transactions other than those pursuant to this
Agreement) under Regulation D and any other applicable
governmental regulations, with respect to eurocurrency
obligations (as defined in Regulation D) for approximately
the same time period as the applicable Eurodollar Period
and in an aggregate amount approximately equal to that
Eurodollar Rate Loan.
"Event of Default" has the meaning set forth for that
----------------
term in Section 9.1.
---
"Excess Proceeds" means, with respect to
---------------
any Fiscal Year, the amount, if any, by which (a) the Net
Cash Proceeds from all Dispositions made in that Fiscal
Year exceeds (b) an amount equal to five percent (5%) of
Consolidated Total Assets as of the last day of the
immediately preceding Fiscal Year.
"Existing Mortgages" means the Metropolitan Mortgage
------------------
and the other Indebtedness identified as such on
Schedule 4.9.
------------
"Existing Subordinated Debt" means, collectively,
--------------------------
Borrower's (a) 6-5/8% senior subordinated debentures due
May 15, 1998, (b) 8-3/8% senior subordinated notes due
October 1, 1999 and (c) 9-5/8% senior subordinated notes
due April 1, 2002.
"Federal Funds Rate" means, as of any date of
------------------
determination, the rate set forth in the weekly
statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve
Board (including any such successor, "H.15(519)") for such
date opposite the caption "Federal Funds (Effective)". If
for any relevant date such rate is not yet published in
H.15(519), the rate for such date will be the rate set
forth in the daily statistical release designated as the
Composite 3:30 p.m. Quotations for U.S. Government
Securities, or any successor publication, published by the
Federal Reserve Bank of New York (including any such
successor, the "Composite 3:30 p.m. Quotation") for such
date under the caption "Federal Funds Effective Rate". If
on any relevant date the appropriate rate for such date is
not yet published in either H.15(519) or the Composite
3:30 p.m. Quotation, the rate for such date will be the
arithmetic mean of the rates for transaction in
overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that date by each of three leading
brokers of Federal funds transactions in New York City
selected by the Administrative Agent. For purposes of
this Agreement, any change in the Alternate Base Rate due
to a change in the Federal Funds Rate shall be effective
as of the opening of business on the effective date of
such change.
"Fiscal Quarter" means each of the four fiscal
--------------
quarters in each Fiscal Year.
"Fiscal Year" means the 52 or 53 week fiscal periods
-----------
of Borrower ending on the Sunday nearest to each
December 31.
"Fixed Charge Coverage Ratio" means, as of the last
---------------------------
day of any Fiscal Quarter, the ratio of the sum of
-------- ---
(a) Adjusted EBITDA plus (b) Rental Expense for the fiscal
----
period consisting of that Fiscal Quarter and the three
immediately preceding Fiscal Quarters to Cash Fixed
--
Charges for such fiscal period.
"Generally Accepted Accounting Principles" means, as
----------------------------------------
of any date of determination, accounting principles
(a) set forth as generally accepted in then currently
effective Opinions of the Accounting Principles Board of
the American Institute of Certified Public Accountants,
(b) set forth as generally accepted in then currently
effective Statements of the Financial Accounting Standards
Board or (c) that are then approved by such other entity
as may be approved by a significant segment of the
accounting profession. The term "consistently applied,"
--------------------
as used in connection therewith, means that the accounting
principles applied as at any dates and for any periods are
either (i) consistent in all material respects to those
applied to the consolidated financial statements of
Borrower as at January 2, 1994 and for the fiscal period
then ended or (ii) not so consistent but the inconsistency
is disclosed in a report on such financial statements, or
prior financial statements, by a firm of independent
certified public accountants and the report states that
such firm concurs in the change of accounting principles
applied thereto.
"Governmental Agency" means (a) any federal, state,
-------------------
county or municipal government, or political subdivision
thereof, (b) any governmental or quasi-governmental
agency, authority, board, bureau, commission,
department,instrumentality, or public body, (c) any court
or administrative tribunal, or (d) any arbitration
tribunal or other non-governmental authority to whose
jurisdiction a Person has consented, in each case whether
of the United States of America or any other nation.
"Government Securities" means readily marketable
---------------------
direct full faith and credit obligations of the United
States of America or obligations unconditionally
guaranteed by the full faith and credit of the United
States of America.
"Guaranty Obligation" means, as to any Person,
-------------------
(a) any direct or indirect guarantee of Indebtedness of,
or other obligation performable by, any other Person,
including any endorsement (other than for collection or
---------
deposit in the ordinary course of business), co-making or
sale with recourse of the obligations of any other Person,
(b) any standby letter of credit or similar undertaking
obtained by that Person as account party for the benefit
of an obligee of any other Person, (c) any obligation of
that Person as a matter of Law to be responsible for the
obligations (excluding obligations under a lease, license
---------
or similar agreement granting rights to use Property) of
any other Person, including the obligation arising from
---------
that Person's status as a general partner of the other
Person and (d) any assurance given to an obligee with
respect to the performance of an obligation by, or the
financial condition of, any other Person, whether direct,
indirect or contingent, including any purchase or
---------
repurchase agreement covering such obligation or any
collateral security therefor, any agreement to provide
funds (by means of loans, capital contributions or
otherwise) to such other Person, any agreement to support
the solvency or level of any balance sheet item of such
other Person, or any "keep-well", "take-or-pay", "through
put" or other arrangement of whatever nature having the
effect of assuring or holding harmless any obligee against
loss with respect to any obligation of such other Person.
The amount of any Guaranty Obligation shall be deemed to
be an amount equal to the stated or determinable amount of
the related primary obligation (unless the Guaranty
Obligation is limited by its terms to a lesser amount, in
which case to the extent of such amount) or, if not stated
or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the Person
in good faith.
"Hazardous Materials" means substances defined
-------------------
as "hazardous substances" pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. section 9601 et seq., or as "hazardous",
"toxic" or "pollutant" substances or as "solid waste"
pursuant to the Hazardous Materials Transportation Act,
49 U.S.C. section 1801, et seq., the Resource Conservation
and Recovery Act, 42 U.S.C. section 6901, et seq., or as
"friable asbestos" pursuant to the Toxic Substances
Control Act, 15 U.S.C. section 2601 et seq. or any other
applicable Hazardous Materials Law, in each case as such
Laws are amended from time to time.
"Hazardous Materials Laws" means all Laws governing
------------------------
the treatment, transportation or disposal of Hazardous
Materials applicable to any of the Real Property.
"Indebtedness" means, as to any Person, (a) all
------------
indebtedness of such Person for borrowed money, (b) that
portion of the obligations of such Person under Capital
Leases which is properly recorded as a liability on a
balance sheet of that Person prepared in accordance with
Generally Accepted Accounting Principles, (c) any
obligation of such Person that is evidenced by a
promissory note or other instrument representing an
extension of credit to such Person, whether or not for
borrowed money, (d) any obligation of such Person for the
deferred purchase price of Property or services
(other than trade or other accounts payable in the
----------
ordinary course of business in accordance with customary
industry terms), (e) any obligation of such Person that is
secured by a Lien (other than a Permitted Encumbrance) on
----------
assets of such Person, whether or not that Person has
assumed such obligation or whether or not such obligation
is nonrecourse to the credit of such Person, but only to
the extent of the fair market value of the assets so
subject to the Lien, (f) obligations of such Person
arising under acceptance facilities or under facilities
for the discount of accounts receivable of such Person,
(g) any direct or contingent obligation of such Person
under letters of credit issued for the account of such
Person and (h) any obligation of such Person under a Swap
Agreement; provided that, to the extent any of the
--------
foregoing obligations constitute a Guaranty Obligation
within the meaning of that term hereunder, such obligation
shall not be Indebtedness hereunder.
"Initial Letters of Credit" means those letters of
-------------------------
credit issued under one of the Prior Syndicated Credit
Facilities and identified with particularity on
Schedule 2.5.
------------
"Interest Coverage Ratio" means, as of the last day
-----------------------
of each Fiscal Quarter, the ratio of (a) Adjusted EBITDA
--------
for the fiscal period consisting of that Fiscal Quarter
and the three immediately preceding Fiscal Quarters to
--
(b) Interest Expense for that fiscal period.
"Interest Expense" means, as of the last day of any
----------------
fiscal period, the aggregate amount of interest, fees,
charges and related expenses paid or payable to a lender
in connection with borrowed money treated as interest
expense in accordance with Generally Accepted Accounting
Principles consistently applied that is charged against
revenues to arrive at Consolidated Income Before
Extraordinary Items during that fiscal period, net of the
------
aggregate amount of any interest income reflected in
Consolidated Income Before Extraordinary Items for that
fiscal period.
"Interest Period" means an Alternate Base Rate Period
---------------
or a Eurodollar Period.
"Investment" means, when used in connection with any
----------
Person, any investment by that Person, whether by means of
purchase or other acquisition of capital stock or other
Securities of any other Person or by means of loan,
advance, capital contribution, guarantee, or other debt or
equity participation or interest in any other Person,
including any partnership or joint venture interest in any
---------
other Person; provided that (a) an Investment of a Person
--------
shall not include any trade or account receivable arising
in the ordinary course of the business of such Person and
(b) any such guarantee by a Person shall be treated
hereunder as both an Investment and a Guaranty Obligation.
The amount of any Investment shall be the amount actually
invested, without adjustment for subsequent increases or
decreases in the value of such Investment.
"Issuing Bank" means (a) with respect to the Initial
------------
Letters of Credit, Bank of America National Trust and
Savings Association and (b) with respect to all other
Letters of Credit, The Chase Manhattan Bank, N.A.
"Laws" means, collectively, all international,
----
foreign, federal, state and local statutes, treaties,
codes, ordinances, rules, regulations and precedents of
any court or other Governmental Agency.
"Letters of Credit" means, collectively, the
-----------------
Commercial Letters of Credit and the Standby Letters of
Credit.
"Leverage Ratio" means, as of any date of
--------------
determination, the ratio of (a) Capital Indebtedness on
--------
that date to (b) the sum of (i) Capital Indebtedness on
-- ---
that date plus (ii) Shareholders' Equity on that date.
----
"Lien" means any mortgage, deed of trust, pledge,
----
hypothecation, assignment for security, security interest,
encumbrance, lien or charge of any kind, whether
voluntarily incurred or arising by operation of Law or
otherwise, affecting any Property, including any agreement
---------
to grant any of the foregoing, any conditional sale or
other title retention agreement, any lease in the nature
of a security interest, and/or the filing of or agreement
to give any financing statement (other than a
----------
precautionary financing statement with respect to a lease
that is not in the nature of a security interest) under
the Uniform Commercial Code or comparable Law of any
jurisdiction with respect to any Property.
"Loan" means any of the groups of Advances made at
----
any one time by the Banks.
"Loan Documents" means, collectively, this Agreement,
--------------
the Notes, the Swing Line Documents, the Letters of
Credit, the Subsidiary Guaranty and any other agreement or
instrument that may hereafter be executed and delivered by
Borrower or a Subsidiary of Borrower in favor of the Banks
relating to or in furtherance of this Agreement.
"Majority Banks" means (a) as of any date of
--------------
determination if the Commitment is then in effect, Banks
having in the aggregate more than 50% of the Commitment
then in effect and (b) as of any date of determination if
the Commitment has then been terminated and there is then
any Indebtedness evidenced by the Notes, Banks holding
Notes evidencing in the aggregate more than 50% of the
aggregate Indebtedness then evidenced by the Notes.
"Managing Agents" has the meaning set forth in the
---------------
introduction to this Agreement. The Managing Agents shall
have no duties or responsibilities (as such) under this
Agreement beyond (a) in the case of the Documentation
Agent, those of the Documentation Agent, (b) in the case
of the Administrative Agent, those of the Administrative
Agent or (c) those of a Bank.
"Material Adverse Effect" means any set of
-----------------------
circumstances or events which (a) has or is reasonably
likely to have any material adverse effect whatsoever upon
the validity or enforceability of any Loan Document,
(b) is or is reasonably likely to be material and adverse
to the financial condition or business operations of
Borrower and its Subsidiaries, taken as a whole, (c)
materially impairs or is reasonably likely to materially
impair the ability of Borrower and its Subsidiaries, taken
as a whole, to perform the Obligations or (d) were
initiated or approved by Borrower or any of its
Subsidiaries and which materially impairs or is reasonably
likely to materially impair the ability of the Banks to
enforce any material legal remedy pursuant to the Loan
Documents.
"Maturity Date" means, subject to Section 2.11,
------------- ----
February 17, 2000.
"Maximum Capital Expenditure Amount" means, for any
----------------------------------
Fiscal Year, $300,000,000 plus the amount, if any, by
----
which $300,000,000 exceeds the actual Capital Expenditures
(excluding Capital Expenditures made pursuant to the
---------
One-Time Capex Basket) of Borrower and its Subsidiaries in
the immediately preceding Fiscal Year.
"Metropolitan Mortgage" means that certain promissory
---------------------
note and related deed of trust dated as of July 22, 1987
between Metropolitan Life Insurance Company and Borrower.
"Multiemployer Plan" means any employee benefit plan
------------------
of a type described in Section 4001(a)(3) of ERISA.
"Negative Pledge" means a Contractual Obligation that
---------------
contains a covenant binding on Borrower or any of its
Subsidiaries that prohibits Liens on any of its or their
Property, other than any such covenant contained in a
----- ----
Contractual Obligation granting a Lien permitted by
Section 6.7 which affects only the Property which is the
---
subject of such permitted Lien.
"Net Cash Proceeds" means, with respect to any
-----------------
Disposition, (a) the gross Cash proceeds received by
Borrower or a Restricted Subsidiary upon such Disposition,
(b) the gross Cash installments paid to Borrower or a
Restricted Subsidiary by an obligor on any promissory note
or other instrument or security received by Borrower upon
such Disposition, and (c) the gross Cash consideration
received by Borrower or a Restricted Subsidiary upon the
sale or other disposition of Property received by Borrower
or a Restricted Subsidiary upon such Disposition, minus in
-----
each case (i) any amount paid or payable by the transferor
to retire existing obligations of or relating to the
property sold, or to retire existing Liens or Rights of
Others on the Property sold, in each case to the extent
that the transferor is contractually obligated to do so,
(ii) the reasonable out-of-pocket expenses of the
transferor incident to such disposition, including
---------
brokerage commissions, investment banking fees, attorneys'
fees and other similar expenses and (iii) an amount
representing the present value, using a discount rate of
10% per annum applied to the period ending on the
reasonably estimated date of payment, of the federal and
state income taxes reasonably estimated by Borrower to be
payable by Borrower with respect to any taxable gain on
such Disposition, which amount of estimated income taxes,
if any, and the estimated date of payment thereof is
acceptable to the Administrative Agent in its reasonable
determination.
"Net Excess Proceeds" means, with respect to any
-------------------
Disposition that results in Excess Proceeds, the amount,
if any, by which (a) such Excess Proceeds exceed (b) the
aggregate cash purchase prices paid by Borrower for
Property of the same type which was the subject of such
Disposition, or for other assets reasonably related to the
business of Borrower, during the one (1) year period
immediately following such Disposition.
"New Mortgage Financings" means Indebtedness incurred
-----------------------
subsequent to the Closing Date that (a) matures on a date
subsequent to the Maturity Date, (b) is payable in amounts
not in excess of the amounts which would be payable on a
straight line amortization basis over fifteen (15) years
and (c) is secured solely by real Property (including
---------
leasehold interests in real Property).
"Note" means any of the promissory notes issued by
----
Borrower to each Bank evidencing Advances by that Bank of
its Pro Rata Share under the Commitment substantially in
the form of Exhibit C, either as originally executed or
---------
the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Obligations" means all present and future
-----------
obligations of every kind or nature of Borrower or any
Party at any time and from time to time owed to the
Administrative Agent, the Documentation Agent, the Issuing
Bank or the Banks or any one or more of them under any one
or more of the Loan Documents, whether due or to become
due, matured or unmatured, liquidated or unliquidated, or
contingent or noncontingent, including obligations of
---------
performance as well as obligations of payment, and
including interest that accrues after the commencement of
---------
any proceeding under any Debtor Relief Law by or against
Borrower or any Affiliate of Borrower.
"Officer's Certificate" means, when used with
---------------------
reference to any Person, a certificate signed by a Senior
Officer of such Person.
"One-Time Capex Basket" means Capital Expenditures
---------------------
made by Borrower and its Subsidiaries (a) during the
Fiscal Year ending on or about December 31, 1995,
(b) that are not in excess of $150,000,000, (c) to fund
the acquisition of new retail store sites, and the
construction or renovation of any improvements located
thereon (including related equipment) and (d) that are not
---------
described in the Projections.
"Opinion of Counsel" means the favorable written
------------------
legal opinion of Terrence J. Wallock, Esq., general
counsel to Borrower, substantially in the form of
Exhibit D, together with copies of all factual
---------
certificates and legal opinions upon which such counsel
has relied.
"Party" means any Person other than the Banks, the
-----
Administrative Agent or the Documentation Agent which now
or hereafter is a party to any of the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation
----
or any successor thereto established under ERISA.
"Pension Plan" means any "employee pension benefit
------------
plan" (as such term is defined in ERISA) which is subject
to Title IV of ERISA and which is maintained for employees
of Borrower or any of its ERISA Affiliates.
"Permitted Encumbrances" means:
----------------------
(a) Inchoate Liens incident to construction or
maintenance of real property; or Liens incident to
construction or maintenance of real property now or
hereafter filed of record for which adequate reserves have
been set aside and which are being contested in good faith
by appropriate proceedings diligently pursued and have not
proceeded to judgment, provided that, by reason of
--------
nonpayment of the obligations secured by such Liens, no
such real property is subject to a material risk of loss
or forfeiture;
(b) Liens for taxes and assessments on real
property which are not yet past due; or Liens for taxes
and assessments on real property for which adequate
reserves have been set aside and are being contested in
good faith by appropriate proceedings and have not
proceeded to judgment, provided that, by reason of
--------
nonpayment of the obligations secured by such Liens, no
such real property is subject to a material risk of loss
or forfeiture;
(c) minor defects and irregularities in title to any
real property which in the aggregate do not materially
impair the fair market value or use of the real property
for the purposes for which it is or may reasonably be
expected to be held;
(d) easements, exceptions, reservations, or other
agreements for the purpose of pipelines, conduits, cables,
wire communication lines, power lines and substations,
streets, trails, walkways, drainage, irrigation, water,
and sewerage purposes, dikes, canals, ditches, the removal
of oil, gas, coal, or other minerals, and other like
purposes affecting real property, facilities, or equipment
which in the aggregate do not materially burden or impair
the fair market value or use of such property for the
purposes for which it is or may reasonably be expected to
be held;
(e) easements, exceptions, reservations, or other
agreements for the purpose of facilitating the joint or
common use of property in a shopping center or similar
real property project affecting real property which in the
aggregate do not materially burden or impair the fair
market value or use of such property for the purposes for
which it is or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental
Agency to control or regulate the use of any real
property;
(g) any obligations or duties affecting any real
property to any Governmental Agency with respect to any
right, power, franchise, grant, license, or permit;
(h) present or future zoning laws and ordinances or
other laws and ordinances restricting the occupancy, use,
or enjoyment of real property;
(i) statutory Liens, including warehouseman's liens,
other than those described in clauses (a) or (b) above,
--- ---
arising in the ordinary course of business with respect to
obligations which are not delinquent or are being
contested in good faith by appropriate proceedings
diligently pursued, provided that, if delinquent, adequate
--------
reserves have been set aside with respect thereto and, by
reason of nonpayment, no material property is subject to a
material risk of loss or forfeiture;
(j) covenants, conditions, and restrictions
affecting the use of real property which in the aggregate
do not materially impair the fair market value or use of
the real property for the purposes for which it is or may
reasonably be expected to be held;
(k) rights of tenants under leases and rental
agreements covering real property entered into in the
ordinary course of business of the Person owning such real
property;
(l) Liens consisting of pledges or deposits to
secure obligations under workers' compensation laws or
similar legislation, including Liens of judgments
thereunder which are not currently dischargeable;
(m) Liens consisting of pledges or deposits of
property to secure performance in connection with
operating leases made in the ordinary course of business
to which Borrower or a Subsidiary is a party as lessee,
provided the aggregate value of all such pledges and
--------
deposits in connection with any such lease does not at any
time exceed 10% of the annual fixed rentals payable under
such lease;
(n) Liens consisting of deposits of property to
secure statutory obligations of Borrower or a Subsidiary
of Borrower in the ordinary course of its business;
(o) Liens consisting of deposits of property to
secure (or in lieu of) surety, appeal or customs bonds in
proceedings to which Borrower or a Subsidiary of Borrower
is a party in the ordinary course of its business; and
(p) Liens created by or resulting from any
litigation or legal proceeding involving Borrower or a
Subsidiary of Borrower in the ordinary course of its
business which is currently being contested in good faith
by appropriate proceedings diligently pursued, provided
--------
that adequate reserves have been set aside and such Liens
are discharged or stayed within 30 days of creation and no
material property is subject to a material risk of loss or
forfeiture.
"Permitted Right of Others" means a Right of Others
-------------------------
consisting of (a) an interest (other than a legal or equitable
co-ownership interest, an option or right to acquire a legal or
equitable co-ownership interest and any interest of a ground
lessor under a ground lease), that does not materially impair the
value or use of property for the purposes for which it is or may
reasonably be expected to be held, (b) an option or right to
acquire a Lien that would be a Permitted Encumbrance or (c) the
reversionary interest of a landlord under a lease of Property.
"Person" means an individual, trustee, corporation,
------
general partnership, limited partnership, joint stock company,
trust, estate, unincorporated organization, union, tribe,
business association or firm, joint venture, Governmental Agency,
or other entity.
"Pricing Occurrence" means (a) with respect to any change
------------------
in the Interest Coverage Ratio which results in a change in the
Applicable Pricing Level, the date upon which Borrower is
required by Section 7.2 to deliver the Compliance Certificate in
---
which such changed Interest Coverage Ratio is reflected and
(b) with respect to any change in the Senior Debt Rating which
results in a change in the Applicable Pricing Level, the date on
which the Administrative Agent receives evidence reasonably
satisfactory to it of such change.
"Pricing Period" means (a) the period commencing on the
--------------
Closing Date and ending on the first Pricing Occurrence to occur
thereafter and (b) each subsequent period commencing on the date
of a Pricing Occurrence and ending on the next Pricing Occurrence
to occur.
"Prime Rate" means the floating commercial loan rate of
----------
the Administrative Agent, announced from time to time as its
"prime rate", which interest rate may not necessarily be the
lowest interest rate at which the Administrative Agent is willing
to extend credit facilities.
"Prior Syndicated Credit Facilities" means, collectively,
----------------------------------
(a) that certain Loan Agreement dated as of October 18, 1991, as
amended, among Borrower, Bank of America National Trust and
Savings Association (as successor to Security Pacific National
Bank), as agent, and the banks therein named and (b) that certain
Term Loan Agreement dated as of December 13, 1993, as amended,
among Bank of America National Trust and Savings Association, as
agent, and the banks therein named.
"Projections" means the financial projections dated
-----------
January 18, 1995 prepared by Borrower and distributed to the
Banks at a meeting held on January 19, 1995.
"Property" means any interest in any kind of property or
--------
asset, whether real, personal or mixed, or tangible or
intangible.
"Pro-Rata Share " means, with respect to each Bank, the
--------------
percentage set forth opposite the name of that Bank on
Schedule 1.1.
- ------------
"Quarterly Payment Date" means March 31, 1995 and each
----------------------
June 30, September 30, December 31 and March 31 thereafter
through and including the Maturity Date.
"Real Property" means, as of any date of determination,
-------------
all real Property then or theretofore owned, leased or occupied
by Borrower or any of the Restricted Subsidiaries.
"Reference Banks" means (a) Bank of America National Trust
---------------
and Savings Association, (b) The Chase Manhattan Bank, N.A.,
(c) NationsBank of Texas, N.A. and (d) such other Bank or Banks
as may from time to time be substituted for any of the foregoing,
as mutually acceptable to the Administrative Agent and Borrower.
"Regulation D" means Regulation D, as at any time amended,
------------
of the Board of Governors of the Federal Reserve System or any
other regulation in substance substituted therefor.
"Regulatory Development" means any or all of the
----------------------
following: (a) any change in the Law or the interpretation
thereof by any Governmental Agency or other authority (whether or
not having the force of Law); (b) the application of any existing
Law or the interpretation thereof by any Governmental Agency or
other authority (whether or not having the force of Law); and
(c) compliance by any Bank with any request or directive (whether
or not having the force of Law) of any monetary or fiscal agency
or authority.
"Rental Expense" means, as of the last day of any fiscal
--------------
period, the aggregate amount of rent and related expenses paid or
payable to a lessor of real or personal property treated as
operating rent in accordance with Generally Accepted Accounting
Principles that is charged against revenues to arrive at
Consolidated Income Before Extraordinary Items during that fiscal
period, net of the aggregate amount of any operating rental
------
income reflected in Consolidated Income Before Extraordinary
Items for that fiscal period.
"Request for Letter of Credit" means a request for letter
----------------------------
of credit signed by a Responsible Official of Borrower,
substantially in the form of Exhibit E.
---------
"Request for Loan" means a request for a Loan signed by a
----------------
Responsible Official of Borrower, substantially in the form of
Exhibit F.
- ---------
"Requirement of Law" means, as to any Person, the articles
------------------
or certificate of incorporation and by-laws or other
organizational or governing documents of such Person, any Law or
any judgment, award, decree, writ or determination of, or any
consent or similar agreement with, a Governmental Agency, in each
case applicable to or binding upon such Person or any of its
Property or to which such Person or any of its Property is
subject.
"Responsible Official" means (a) when used with reference
--------------------
to a Person other than an individual, any corporate officer of
such Person, general partner of such Person, corporate officer of
a corporate general partner of such Person, or corporate officer
of a corporate general partner of a partnership that is a general
partner of such Person, or any other responsible official thereof
duly acting on behalf thereof, and (b) when used with reference
to a Person who is an individual, such Person. Any document or
certificate hereunder that is signed or executed by a Responsible
Official of a Person shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other
action on the part of that Person unless this Agreement
------
specifically requires that such document or certificate be
provided by a Senior Officer of that Person.
"Restricted Subsidiary" means any Subsidiary of Borrower
---------------------
that is not an Unrestricted Subsidiary.
"Right of Others" means, as to any Property in which a
---------------
Person has an interest, any legal or equitable claim or other
interest (other than a Lien) in or with respect to that property
held by any other Person, and any option or right held by any
other Person to acquire any such claim or other interest,
including a Lien.
"Securities" means any capital stock, share, voting trust
----------
certificate, bonds, debentures, notes or other evidences of
indebtedness, limited partnership interests, or any warrant,
option or other right to purchase or acquire any of the
foregoing.
"Senior Officer" means the (a) chief executive officer,
--------------
(b) chief operating officer, (c) chief financial officer, (d) any
executive vice president, (e) treasurer or (f) general counsel,
in each case whatever the title nomenclature may be, of the
Person designated.
"Senior Debt Rating" means the actual or implied rating of
------------------
Borrower's long term unsecured senior debt as determined by
either Standard & Poor's Ratings Group (a division of
McGraw-Hill, Inc.) or Moody's Investors Service, Inc. (and, if by
both such rating agencies, then the higher of such credit
ratings).
"Shareholders' Equity" means, as of any date of
--------------------
determination, the consolidated shareholders' equity of Borrower
and its Subsidiaries as of that date determined in accordance
with Generally Accepted Accounting Principles; provided that
--------
there shall be excluded from Shareholders' Equity any amount
attributable to capital stock that is, directly or indirectly,
required to be redeemed or repurchased by the issuer thereof at a
specified date or upon the occurrence of specified events or at
the election of the holder thereof.
"Significant Subsidiary" means, as of any date of
----------------------
determination, any Restricted Subsidiary, now or hereafter
existing, that has at that date total assets having a book value
or a fair market value in excess of $15,000,000.
"Standby Letters of Credit" means any standby letter of
-------------------------
credit issued by the Issuing Bank pursuant to Section 2.5 in the
---
standard form for standby letters of credit of the Issuing Bank,
either as originally issued or as the same may from time to time
be supplemented, modified, amended, renewed, extended or
supplanted.
"Subordinated Obligations" means, collectively, (a) the
------------------------
Existing Subordinated Debt and (b) any other Indebtedness of
Borrower that (i) is subordinated to the Obligations pursuant to
subordination provisions (including interest blockage and
standstill provisions) at least as favorable to the Banks as
those contained in the Existing Subordinated Debt or as may be
approved by the Majority Banks, (ii) does not require the payment
of principal prior to the Maturity Date whether by reason of
maturity, scheduled amortization, mandatory redemption
provisions, redemption at the option of the holder thereof,
sinking fund payments or otherwise, and (iii) is issued pursuant
to documentation containing financial covenants and events of
default not more onerous to Borrower, or other covenants and
non-yield or non-tenor related provisions not more onerous to
Borrower in any material respect, than those contained in this
Agreement.
"Subsidiary" means, with respect to any Person, any
----------
corporation, partnership or joint venture whether now existing or
hereafter organized or acquired: (a) in the case of a
corporation, of which a majority of the securities having
ordinary voting power for the election of a majority of the board
of directors (other than securities having such power only by
reason of the happening of a contingency) are at the time owned
by such Person and/or one or more Subsidiaries of such Person or
(b) in the case of a partnership, joint venture or other business
entity, in which such Person is a general partner or joint
venturer or of which a majority of the partnership or other
ownership interests are at the time owned by such Person and/or
one or more of its Subsidiaries.
"Subsidiary Guaranty" means the guaranty of the
-------------------
Obligations executed by each wholly-owned Significant Subsidiary
of Borrower substantially in the form of Exhibit G, either as
---------
originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Swap Agreement" means one or more written agreements
--------------
between Borrower and one or more financial institutions providing
for "swap" or "floor" interest rate protection with respect to
any Indebtedness.
"Swing Line" means the revolving line of credit
----------
established by the Swing Line Bank in favor of Borrower pursuant
to Section 2.10.
----
"Swing Line Bank" means The Chase Manhattan Bank, N.A.
---------------
"Swing Line Documents" means the promissory note and other
--------------------
documents executed by Borrower in favor of the Swing Line Bank in
connection with the Swing Line.
"Swing Line Loans" means loans made by the Swing Line Bank
----------------
to Borrower pursuant to Section 2.10.
----
"Swing Line Outstandings" means, as of any date of
-----------------------
determination, the aggregate principal Indebtedness of Borrower
on all Swing Line Loans then outstanding.
"Syndicated Outstandings" means, as of any date of
-----------------------
determination, the sum of (a) the outstanding principal
---
Indebtedness evidenced by the Notes, plus (b) the aggregate
----
effective face amount of all Letters of Credit then outstanding,
plus (c) the aggregate amounts drawn under Letters of Credit that
- ----
have not been reimbursed to the Issuing Bank plus (d) the Swing
----
Line Outstandings.
"Syndications Agent" means BA Securities, Inc. The
------------------
Syndications Agent shall have no duties or responsibilities under
this Agreement.
"Termination Event" means (a) a "reportable event" as
-----------------
defined in Section 4043 of ERISA (other than a "reportable event"
----------
that is not subject to the provision for 30 day notice to the
PBGC), (b) the withdrawal of Borrower or any of its ERISA
Affiliates from a Pension Plan during any plan year in which it
was a "substantial employer" as defined in Section 4001(a)(2) of
ERISA, (c) the filing of a notice of intent to terminate a
Pension Plan or the treatment of an amendment to a Pension Plan
as a termination thereof pursuant to Section 4041 of ERISA,
(d) the institution of proceedings to terminate a Pension Plan by
the PBGC or (e) any other event or condition which might
reasonably be expected to constitute grounds under ERISA for the
termination of, or the apportionment of a trustee to administer,
any Pension Plan.
"to the best knowledge of" means, when modifying a
------------------------
representation, warranty, or other statement of any Person, that
such representation, warranty or statement is a representation,
warranty or statement that (a) the Person making it has no actual
knowledge of the inaccuracy of the matters therein stated and
(b) assuming the exercise by the Person making it of reasonable
due diligence under the circumstances (in accordance with the
standard of what a reasonable Person would have done under
similar circumstances), the Person making it would have no actual
knowledge of the inaccuracy of the matters therein stated. Where
the Person making the representation, warranty or statement is
not a natural Person, the aforesaid actual or constructive
knowledge shall be that of any Senior Officer of that Person.
"Uncommitted Money Market Facility" means a money market
---------------------------------
credit facility substantially in the form of Exhibit H, or such
---------
other form of money market credit facility as may be reasonably
acceptable to the Administrative Agent.
"Uncommitted Short Term Facilities" means short term
---------------------------------
working capital credit facilities made available to Borrower for
the borrowing of money, issuance of commercial paper, issuance of
letters of credit or creation of bankers' acceptances on an
uncommitted basis for which no commitment fee, compensating
balance or similar consideration is charged or required by the
provider thereof; provided that any such credit facility for the
--------
borrowing of money shall be in the form of an Uncommitted Money
Market Facility.
"Unrestricted Subsidiary" means (a) Miramar Associates,
-----------------------
(b) VAT Partners, (c) VAT Partners II and (d) any other
Subsidiary of Borrower that (i) is not a wholly-owned Subsidiary
of Borrower and (ii) Borrower designates as an Unrestricted
Subsidiary by written notice to the Administrative Agent.
"Unused Availability" means, as of any date of
-------------------
determination, the amount, if any, by which the then effective
Commitment exceeds the Syndicated Outstandings.
"Unused Commitment" means, as of any date of
-----------------
determination, the amount, if any, by which the then effective
Commitment exceeds the sum of (a) the aggregate principal
---
Indebtedness evidenced by the Notes plus (b) the aggregate
----
effective face amount of all outstanding Standby Letters of
Credit.
1.2 Use of Defined Terms. Any defined term used in the
--------------------
plural preceded by the definite article shall be taken to
encompass all members of the relevant class. Any defined term
used in the singular preceded by "any" shall be taken to indicate
any number of the members of the relevant class.
1.3 Accounting Terms. All accounting terms not
----------------
specifically defined in this Agreement shall be construed in
conformity with, and all financial data required to be submitted
by this Agreement shall be prepared in conformity with, Generally
Accepted Accounting Principles, consistently applied, except as
------
otherwise specifically prescribed herein. In the event that
Generally Accepted Accounting Principles change (or Borrower
elects to apply a new Generally Accepted Accounting Principle
prior to the date the same becomes the exclusive Generally
Accepted Accounting Principle) during the term of this Agreement
such that the financial covenants contained in Sections 6.13
----
through 6.16 or the components of the Interest Coverage Ratio
----
would then be calculated in a different manner or with different
components or would not be equivalent criteria for evaluating
Borrower's financial condition, Borrower and the Banks agree to
amend this Agreement in such respects as are necessary to conform
those covenants or components as criteria for evaluating
Borrower's financial condition to substantially the same criteria
as were effective prior to such change in Generally Accepted
Accounting Principles. If the Banks and Borrower fail to reach
agreement on such an amendment, the changes in Generally Accepted
Accounting Principles shall not be given effect for purposes of
such calculations.
1.4 Rounding. Any financial ratios required to be
--------
maintained by Borrower pursuant to this Agreement shall be
calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number
of places by which such ratio is expressed in this Agreement and
rounding the result up or down to the nearest number (with a
round-up if there is no nearest number) to the number of places
by which such ratio is expressed in this Agreement.
1.5 Miscellaneous Terms. The term "or" is disjunctive;
-------------------
the term "and" is conjunctive. The term "shall" is mandatory;
the term "may" is permissive. Masculine terms also apply to
females; feminine terms also apply to males. The term
"including" is by way of example and not limitation.
1.6 Exhibits and Schedules. All Exhibits and Schedules
----------------------
to this Agreement, either as originally existing or as the same
may from time to time be supplemented, modified, or amended, are
incorporated herein by reference. A matter disclosed on any
Schedule shall be deemed disclosed on all Schedules.
1.7 Subsidiaries . If at any date during the term of
------------
this Agreement Borrower does not have any Subsidiaries, the
provisions of this Agreement which refer to Subsidiaries of
Borrower, or to consolidated financial statements of Borrower and
its Subsidiaries, shall be ignored. This Agreement is drafted to
include references to Borrower and its Subsidiaries in order
that, if Borrower at any date has one or more Subsidiaries, this
Agreement will apply to such Subsidiaries and that the financial
statements referred to in this Agreement and any financial
measurements based thereon will be consolidated financial
statements and consolidated financial measurements.
ARTICLE 2
LOANS AND LETTERS OF CREDIT
---------------------------
2.1 Loans-General.
-------------
(a) Subject to the terms and conditions set forth in
this Agreement, at any time and from time to time from the
Closing Date through the Maturity Date, each Bank shall,
pro rata according to that Bank's Pro Rata Share of the
Commitment then in effect, make Advances to Borrower under
the Commitment in such amounts as Borrower may request;
provided that, giving effect to such Advance, (i) that
--------
Bank's Pro Rata Share of the Syndicated Outstandings will
not exceed that Bank's Pro Rata Share of the Commitment
and (ii) the Syndicated Outstandings will not exceed the
Commitment. Subject to the limitations set forth herein,
Borrower may borrow, repay and reborrow under this
Section 2.1 without premium or penalty.
---
(b) Subject to the next sentence, each Loan shall be
made pursuant to a Request for Loan which shall specify
the requested (i) date of such Loan, (ii) type of Loan,
(iii) amount of such Loan, and (iv) Interest Period for
such Loan. Unless the Administrative Agent has notified,
in its sole and absolute discretion, Borrower to the
contrary, a Loan may be requested by telephone or
telecopier by a Responsible Official of Borrower, in which
case Borrower shall confirm such request by promptly
mailing a Request for Loan conforming to the preceding
sentence to the Administrative Agent.
(c) Promptly following receipt of a Request for
Loan, the Administrative Agent shall notify each Bank by
telephone or telecopier of the date and type of the Loan,
the applicable Interest Period, and that Bank's Pro Rata
Share of the Loan. Not later than 9:30 a.m., Los Angeles
time, on the date specified for any Loan, each Bank shall
make its portion of the Loan in immediately available
funds available to the Administrative Agent at the
Administrative Agent's Office. Upon fulfillment of the
applicable conditions set forth in Article 8, all Advances
---------
shall be credited in immediately available funds to the
Designated Deposit Account.
(d) The principal amount of each Loan shall be an
integral multiple of $1,000,000 and shall be in an amount
not less than $5,000,000 if such Loan is a Eurodollar Rate
Loan.
(e) The Advances made by each Bank under the
Commitment shall be evidenced by that Bank's Note.
(f) A Request for Loan shall be irrevocable upon the
Administrative Agent's first notification thereof. The
obligation of each Bank to make any Advance is several,
and not joint or joint and several, and is not conditioned
upon the performance by any other Bank of its obligation
to make Advances. The failure by any Bank to perform its
obligation to make any Advance will not increase the
obligation of any other Bank to make Advances.
(g) If no Request for Loan (or telephonic or other
request for loan referred to in the second sentence of
Section 2.1(b), if applicable) has been made within the
------
requisite notice periods set forth in Sections 2.2 and
---
2.3 in connection with a Loan which, if made, would not
---
increase the outstanding principal indebtedness evidenced
by the Notes and would not cause the Syndicated
Outstandings to exceed the Commitment, then Borrower shall
be deemed to have requested an Alternate Base Rate Loan in
an amount equal to the amount necessary to cause the
outstanding principal Indebtedness evidenced by the Notes
to remain the same and, subject to Section 8.3, the Banks
---
shall make the Advances necessary to make such Loan
notwithstanding Sections 2.1(b) and 2.2.
------ ---
1.2 Alternate Base Rate Loans. Each request by Borrower
-------------------------
for an Alternate Base Rate Loan shall be made pursuant to a
Request for Loan (or telephonic or other request for loan
referred to in the second sentence of Section 2.1(b), if
------
applicable) received by the Administrative Agent, at the
Administrative Agent's Office, not later than 10:00 a.m.
Los Angeles time, at least one (1) Banking Day before the first
day of the applicable Alternate Base Rate Period. All Loans
shall constitute Alternate Base Rate Loans unless properly
designated as Eurodollar Rate Loans pursuant to Section 2.3.
---
2.3 Eurodollar Rate Loans.
---------------------
(a) Each request by Borrower for a Eurodollar Rate
Loan shall be made pursuant to a Request for Loan (or
telephonic or other request for loan referred to in the
second sentence of Section 2.1(b), if applicable) received
------
by the Administrative Agent, at the Administrative Agent's
Office, not later than 10:00 a.m., Los Angeles time, at
least three (3) Designated Eurodollar Market Days before
the first day of the applicable Eurodollar Period.
(b) At or about 9:00 a.m., Los Angeles time, two (2)
Designated Eurodollar Market Days before the first day of
the applicable Eurodollar Period, the Administrative Agent
shall determine the applicable Eurodollar Rate (which
determination shall be conclusive in the absence of
manifest error) and promptly shall give notice of the same
to Borrower and the Banks by telephone or telecopier.
(c) Without the consent of the Administrative Agent,
not more than twenty (20) Eurodollar Rate Loans may be
outstanding at any particular time.
(d) Unless all of the Banks otherwise consent, no
Eurodollar Rate Loan may be requested during the
continuance of a Default or Event of Default.
(e) Nothing contained herein shall require any Bank
to fund any Advance pertaining to a Eurodollar Rate Loan
in the Designated Eurodollar Market.
2.4 Commercial Letters of Credit.
----------------------------
(a) Subject to the terms and conditions hereof, at
any time and from time to time from the Closing Date
through the day prior to the Maturity Date, the Issuing
Bank shall issue such Commercial Letters of Credit as
Borrower may request by a Request for Letter of Credit;
provided that, giving effect to such Letter of Credit,
--------
(i) the Syndicated Outstandings will not exceed the
Commitment and (ii) the aggregate effective face amounts
of all outstanding Letters of Credit will not exceed
$125,000,000. Unless all the Banks otherwise consent in
writing, the term of any Commercial Letter of Credit shall
not exceed 12 months or extend beyond the Maturity Date.
No Commercial Letter of Credit shall be issued except to
the extent reasonably necessary in connection with
transactions in the ordinary course of business of
Borrower or one of its Subsidiaries.
(b) The Request for Letter of Credit shall be
submitted to the Issuing Bank at least three (3) Banking
Days prior to the date when required. Upon issuance of a
Letter of Credit, the Issuing Bank shall promptly notify
the Banks of the amount and terms thereof. The Issuing
Bank shall notify the Banks within 10 days after the end
of each month of all payments, reimbursements,
expirations, transfers and other activity during that
month with respect to outstanding Letters of Credit.
(c) Upon the issuance of a Letter of Credit, each
Bank shall be deemed to have purchased a participation
from the Issuing Bank in an amount equal to that Bank's
Pro Rata Share of the Commitment of the amount of the
Letter of Credit; provided that any such participation
--------
then in existence shall terminate upon the termination of
this Agreement prior to the Maturity Date. Without
limiting the scope and nature of each Bank's participation
in any Letter of Credit, to the extent that the Issuing
Bank has not been reimbursed by Borrower for any payment
required to be made by the Issuing Bank under any Letter
of Credit, each Bank shall, according to its Pro Rata
Share of the Commitment, reimburse the Issuing Bank
promptly upon demand for the amount of such payment. The
obligation of each Bank to so reimburse the Issuing Bank
shall be absolute and unconditional and shall not be
affected by the occurrence of an Event of Default or any
other occurrence or event. Any such reimbursement shall
not relieve or otherwise impair the obligation of Borrower
to reimburse the Issuing Bank for the amount of any
payment made by the Issuing Bank under any Letter of
Credit together with interest as hereinafter provided.
(d) Borrower agrees to pay to the Issuing Bank with
respect to each Letter of Credit, within one (1) Banking
Day after demand therefor, a principal amount equal to any
payment made by the Issuing Bank under that Letter of
Credit, together with interest on such amount from the
date of any payment made by the Issuing Bank through the
date that is one (1) Banking Day after such demand at the
Alternate Base Rate and thereafter through the date of
payment by Borrower at the Default Rate. The principal
amount of any such payment made by Borrower to the Issuing
Bank shall be used to reimburse the Issuing Bank for the
payment made by it under the Letter of Credit. Each Bank
that has reimbursed the Issuing Bank pursuant to
Section 2.4(c) for its Pro-Rata Share of any payment made
------
by the Issuing Bank under a Letter of Credit shall
thereupon acquire a participation, to the extent of such
reimbursement, in the claim of the Issuing Bank against
Borrower under this Section 2.4(d). The Issuing Bank
------
shall promptly make available to the Administrative Agent,
and the Administrative Agent shall promptly make available
to the Banks holding such a participation in immediately
available funds, according to each such Banks'
proportional participation in such Letter of Credit, any
amounts received by the Issuing Bank from or for the
account of Borrower with respect to such Letter of Credit.
(e) If Borrower fails to make the payment required
by Section 2.4(d), the Administrative Agent may but is not
------
required to, without notice to or the consent of Borrower,
cause Advances to be made by the Banks under the
Commitment in an aggregate amount equal to the amount paid
by the Issuing Bank on that Letter of Credit and, for this
purpose, the conditions precedent set forth in
Sections 8.1, 8.2 and 8.3 shall not apply. The proceeds
--- --- ---
of such Advances shall be paid to the Issuing Bank to
reimburse it for the payment made by it under the Letter
of Credit.
(f) The issuance of any supplement, modification,
amendment, renewal, or extension to or of any Letter of
Credit shall be treated in all respects the same as the
issuance of a new Letter of Credit.
(g) The obligation of Borrower to pay to the Issuing
Bank the amount of any payment made by the Issuing Bank
under any Letter of Credit shall be absolute,
unconditional, and irrevocable, subject only to
performance by the Issuing Bank of its obligations to
Borrower under California Commercial Code Section 5109.
Without limiting the foregoing, and expressly subject to
such Section 5109, such obligation of Borrower shall not
be affected by any of the following circumstances:
(i) any lack of validity or enforceability
of the Letter of Credit, this Agreement, or any
other agreement or instrument relating thereto;
(ii) any amendment or waiver of or any
consent to departure from the Letter of Credit,
this Agreement, or any other agreement or
instrument relating thereto with the consent of
Borrower;
(iii) the existence of any claim, setoff,
defense, or other rights which Borrower may have
at any time against any Bank, any beneficiary of
the Letter of Credit (or any persons or entities
for whom any such beneficiary may be acting) or
any other Person, whether in connection with the
Letter of Credit, this Agreement, or any other
agreement or instrument relating thereto, or any
unrelated transactions;
(iv) any demand, statement, or any other
document presented under the Letter of Credit
proving to be forged, fraudulent, invalid, or
insufficient in any respect or any statement
therein being untrue or inaccurate in any
respect whatsoever;
(v) payment by the Issuing Bank under the
Letter of Credit against presentation of a draft
or any accompanying document which does not
strictly comply with the terms of the Letter of
Credit;
(vi) the existence, character, quality,
quantity, condition, packing, value or delivery
of any property purported to be represented by
documents presented in connection with any
Letter of Credit or for any difference between
any such property and the character, quality,
quantity, condition, or value of such property
as described in such documents;
(vii) the time, place, manner, order or
contents of shipments or deliveries of property
as described in documents presented in
connection with any Letter of Credit or the
existence, nature and extent of any insurance
relative thereto;
(viii) the solvency or financial
responsibility of any party issuing any
documents in connection with a Letter of Credit;
(ix) any failure or delay in notice of
shipments or arrival of any property;
(x) any error in the transmission of any
message relating to a Letter of Credit not
caused by the Issuing Bank, or any delay or
interruption in any such message; and
(xi) any error, neglect, or default of any
correspondent of the Issuing Bank in connection
with a Letter of Credit, unless the Issuing Bank
had prior notice thereof or the reasonable
opportunity to prevent the same.
(h) The Issuing Bank shall be entitled to the
benefits accorded by Article 10 to the Administrative
----------
Agent, mutatis mutandis.
------- --------
(i) In the event that this Agreement is
terminated prior to the Maturity Date and there are
then Commercial Letters of Credit outstanding,
Borrower agrees that, upon request of the Issuing
Bank, it will either (i) pay to the Issuing Bank a
supplemental letter of credit fee equal to 1/4% per
annum with respect to the face amount and then
remaining term of each such Commercial Letter of
Credit or (ii) provide to the Issuing Bank a standby
letter of credit issued by a financial institution
reasonably acceptable to the Issuing Bank in support
of that Commercial Letter of Credit, whichever may be
requested by the Issuing Bank, unless otherwise
agreed by the Issuing Bank.
2.5 Standby Letters of Credit.
-------------------------
(a) Subject to the terms and conditions
hereof, at any time and from time to time from the
Closing Date through the day prior to the Maturity
Date, the Issuing Bank shall issue such Standby
Letters of Credit as Borrower may request by a
Request for Letter of Credit; provided that, giving
--------
effect to such Standby Letter of Credit, (i) the
Syndicated Outstandings will not exceed the
Commitment and (ii) the aggregate effective face
amounts of all outstanding Letters of Credit will not
exceed $125,000,000. Unless all the Banks otherwise
consent in writing, the term of any Standby Letter of
Credit shall not exceed 12 months or extend beyond
the Maturity Date. No Standby Letter of Credit shall
be issued except to the extent used in the ordinary
course of business of Borrower or any of its
Subsidiaries or in connection with any Investment
permitted by Section 6.4.
---
(b) The Request for Letter of Credit shall be
submitted to the Issuing Bank at least one
(1) Banking Day prior to the date when required.
Except as provided in the preceding sentence, the
------
provisions of Sections 2.4(b) through 2.4(h),
------ ------
inclusive, shall also apply to Standby Letters of
Credit.
(c) On the Closing Date, the Initial Letters of
Credit shall automatically be Standby Letters of
Credit under this Agreement.
(d) In the event that this Agreement is
terminated prior to the Maturity Date and there are
then Standby Letters of Credit outstanding, each Bank
agrees that, upon request of the Issuing Bank, it
will either (i) rebate to the Issuing Bank the
unearned portion of the letter of credit fees paid to
that Bank pursuant to Section 3.7 for each such
---
Standby Letter of Credit or (ii) provide to the
Issuing Bank a standby letter of credit of that Bank
in support of its Pro-Rata Share participation
interest in each such Standby Letter of Credit
through the earlier of the expiration date of such
Letter of Credit or the next Quarterly Payment Date,
whichever may be requested by the Issuing Bank. If
the Issuing Bank so requests a standby letter of
credit from any Bank, Borrower agrees that it will
enter into the standard form of standby letter of
credit reimbursement agreement with such Bank, but
without any standby letter of credit fee payable to
such Bank so long as it has not rebated to the
Issuing Bank its letter of credit fees under this
Agreement. In the event that this Agreement is
terminated prior to the Maturity Date and there are
then Standby Letters of Credit outstanding, Borrower
agrees that, upon request of the Issuing Bank, it
will either (i) pay to the Issuing Bank such
supplemental letter of credit fees as may be mutually
acceptable to Borrower and the Issuing Bank
attributable to the period commencing on the next
Quarterly Payment Date and ending on the expiration
date of such outstanding Standby Letters of Credit or
(ii) provide to the Issuing Bank a standby letter of
credit issued by a financial institution reasonably
acceptable to the Issuing Bank in support of such
outstanding Standby Letters of Credit for the period
commencing on the next Quarterly Payment Date and
ending on the expiration date thereof, whichever may
be requested by the Issuing Bank.
2.6 Mandatory Reduction of the Commitment. The then
-------------------------------------
effective Commitment shall automatically be reduced, on
the Banking Day that is nearest to the date that is
one (1) year immediately following the date of any
Disposition that results in Excess Proceeds, by an amount
equal to the Net Excess Proceeds with respect to such
Disposition.
2.7 Voluntary Reduction of the Commitment. Borrower
-------------------------------------
shall have the right, at any time and from time to time,
without penalty or charge, upon at least three (3) Banking
Day's prior written notice to the Administrative Agent,
voluntarily to reduce, permanently and irrevocably, in
aggregate amounts in an integral multiple of $5,000,000,
or to terminate, all or a portion of any of the
Commitment.
2.8 Involuntary Termination of the Commitment. The
-----------------------------------------
Majority Banks shall have the right, at any time during
the sixty (60) day period following a Change in Control,
upon at least five (5) Banking Days' prior written notice
to Borrower, to reduce or to terminate all or a portion of
any of the Commitment.
2.9 Administrative Agent's Right to Assume Funds
--------------------------------------------
Available. Unless the Administrative Agent shall have
---------
been notified by any Bank at least two hours prior to the
funding by the Administrative Agent of any Loan that such
Bank does not intend to make available to the
Administrative Agent such Bank's portion of the total
amount of such Loan, the Administrative Agent may assume
that such Bank has made such amount available to the
Administrative Agent on the date of the Loan and the
Administrative Agent may, in reliance upon such
assumption, make available to 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 recover such
corresponding amount on demand from such Bank, which
demand shall be made in a reasonably prompt manner. If
such Bank does not pay such corresponding amount forthwith
upon the Administrative Agent's demand therefor, the
Administrative Agent promptly shall notify Borrower and
Borrower shall pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also
be entitled to recover from such Bank interest on such
corresponding amount in respect of each day from the date
such corresponding amount was made available by the
Administrative Agent to Borrower to the date such
corresponding amount is recovered by the Administrative
Agent at the Federal Funds Rate. Nothing herein shall be
deemed to relieve any Bank from its obligation to fund its
Pro Rata Share of the Commitment hereunder or to prejudice
any rights which the Administrative Agent or Borrower may
have against any Bank as a result of any default by such
Bank hereunder.
2.10 Swing Line.
----------
(a) The Swing Line Bank shall from time to
time through the day prior to the Maturity Date make
Swing Line Loans to Borrower in such amounts as
Borrower may request, provided that (i) giving effect
--------
to such Swing Line Loan, the Swing Line Outstandings
do not exceed $25,000,000, (ii) the conditions set
forth in Section 8.2(b) either shall have been
------
satisfied or shall have been waived by the Majority
Banks and (iii) without the consent of all of the
Banks, no Swing Line Loan may be made during the
continuation of an Event of Default. Borrower may
borrow, repay and reborrow under this Section.
Unless notified to the contrary by the Swing Line
Bank, borrowings under the Swing Line may be made in
amounts which are integral multiples of $100,000 upon
telephonic request by a Responsible Official of
Borrower made to the Swing Line Bank not later than
11:00 a.m., Los Angeles time, on the Banking Day of
the requested borrowing. Unless notified to the
contrary by the Swing Line Bank, each repayment of a
Swing Line Loan shall be an in amount which is an
integral multiple of $100,000. If Borrower instructs
the Swing Line Bank to debit the Designated Deposit
Account (or other demand deposit account) in the
amount of any payment with respect to a Swing Line
Loan on or before 11:00 a.m., Los Angeles time, on a
Banking Day, such payment shall be deemed received on
such Banking Day; provided that the Designated
--------
Deposit Account (or other account, as applicable) has
a credit balance in collected funds at least equal to
the amount of such payment prior to the close of
business for the Swing Line Bank on such Banking Day.
If no such debit instructions are given, or if the
Swing Line Bank otherwise receives repayment, after
11:00 a.m., Los Angeles time, on a Banking Day, such
payment shall be deemed received on the next Banking
Day.
(b) Swing Line Loans shall bear interest at
such interest rate as is mutually agreed-upon by the
Swing Line Bank and Borrower (and if not so agreed,
at the Alternate Base Rate) concurrently with each
Swing Line Loan, payable on such dates, not more
frequent than monthly, as may be specified by the
Swing Line Bank and in any event on the Maturity
Date. The interest payable on Swing Line Loans is
solely for the account of the Swing Line Bank (unless
the Banks shall have paid to the Swing Line Bank the
purchase price for their participation therein
pursuant to Section 2.10(d), in which case interest
-------
shall thereafter be for the account of the Banks in
accordance with their Pro Rata Share of the
Commitment).
(c) The Swing Line Loans shall be payable on
the date agreed upon by Borrower and the Swing Line
Bank at the time of such Swing Line Loan (which date
may not be later than ten (10) days from the date of
the Swing Line Loan), and in any event on the
Maturity Date.
(d) Upon the making of a Swing Line Loan, each
Bank shall be deemed to have purchased from the Swing
Line Bank a participation therein in an amount equal
to that Bank's Pro Rata Share of the Commitment.
Upon demand made by the Swing Line Bank, each Bank
shall, according to its Pro Rata Share of the
Commitment, promptly provide to the Swing Line Bank
its purchase price therefor in an amount equal to its
participation therein. The obligation of each Bank
to so provide its purchase price to the Swing Line
Bank shall be absolute and unconditional and shall
not be affected by the occurrence of an Event of
Default or any other occurrence or event.
(e) Unless Borrower has made other
arrangements acceptable to the Swing Line Bank to
repay each Swing Line Loan upon the date when due,
Borrower shall, on such date, request a Loan pursuant
to Section 2.1(a) in an amount sufficient to repay
------
such Swing Line Loan on that day (and, for this
purpose, the limitations set forth in Section 2.1(d)
-----
shall not apply) and the Administrative Agent shall
automatically provide to the Swing Line Bank the
amount necessary to repay such Swing Line
Outstandings (which the Swing Line Bank shall then
apply to such repayment) and credit any balance of
the Loan in immediately available funds to the
Designated Deposit Account. In the event that
Borrower fails to request a Loan within the
time specified by Section 2.2 on any such
---
date, the Administrative Agent may, but is not
required to, without notice to or the consent of
Borrower, cause Advances to be made by the Banks
under the Commitment in an aggregate amount equal to
the maturing Swing Line Loan and, for this purpose,
the conditions precedent set forth in Sections 8.1,
---
8.2 and 8.3 shall not apply. The proceeds of such
--- ---
Advances shall be paid to the Swing Line Bank for
application to the Swing Line Outstandings.
2.11 Extension of Maturity Date. On September 1, 1997
--------------------------
(or within the twenty (20) Banking Day period commencing on
such date), and on each anniversary of such date and such
period, Borrower may by written request delivered to the
Administrative Agent request that the Maturity Date be extended
for one (1) year. Such request shall be accompanied either by
a written statement of a Senior Officer of Borrower confirming
the reasonableness of the budget most recently provided to the
Banks pursuant to Section 7.1(c) or by a revised budget as
------
required by such Section.
The Administrative Agent shall promptly forward the
request for extension, and any accompanying materials, to the
Banks. Each Bank, in its sole and absolute discretion, shall
determine whether to grant the request for extension. The
Banks agree to use their best efforts to respond to the request
for extension within thirty (30) Banking Days after receipt of
the request for extension; failure to respond shall in no event
be deemed to be a consent to the extension.
If all of the Banks notify the Administrative Agent in
writing that they consent to the requested extension, the
Maturity Date shall automatically be extended for one (1) year.
The Administrative Agent shall notify Borrower and the Banks in
writing of such an extension. If all of the Banks do not so
notify the Administrative Agent in writing that they consent to
the extension, the Maturity Date shall remain as then in
effect, subject to the next paragraph below if Borrower elects
to remove the Non-Consenting Banks as therein provided.
If Banks holding at least 66-2/3% of the Commitment
consent to the request for extension, but one or more Banks
(each a "Non-Consenting Bank") notify the Administrative Agent
that it will not consent to the request for extension (or fail
to notify the Administrative Agent in writing of its consent to
the extension), Borrower may, at its election, cause such
Non-Consenting Bank to be removed as a Bank under this
Agreement pursuant to Section 11.23. If such removal is
-----
accomplished by assignment to an Eligible Assignee and such
Eligible Assignee notifies the Administrative Agent in writing
that it consents to the request for extension, then the request
for extension shall be granted with the effect as set forth
above. If such removal is accomplished by a voluntary
reduction of the Commitment, then the Administrative Agent
shall notify all of the Banks in writing thereof and each Bank
shall have the right to notify the Administrative Agent within
ten (10) Banking Days after receipt of such notice that such
Bank will not consent to the request for extension, in which
case such Bank shall be treated as a Non-Consenting Bank. If
removal is accomplished by a voluntary reduction of the
Commitment and none of the remaining Banks so notify the
Administrative Agent that it will not consent to the request
for extension, then the request for extension shall be granted
with the effect as set forth above. In either case, therefore,
giving effect to the removal of all Non-Consenting Banks, all
remaining Banks must have consented to the extension of the
Maturity Date for the extension to be effective.
ARTICLE 3
PAYMENTS; FEES
--------------
3.1 Principal and Interest.
----------------------
(a) Interest shall be payable on the outstanding
daily unpaid principal amount of each Loan from the date
thereof until payment in full and shall accrue and be
payable at the rates set forth herein, before and after
default, before and after maturity, before and after any
judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law, with interest on
overdue interest to bear interest at the Default Rate to
the extent permitted by applicable Laws.
(b) Interest accrued on each Alternate Base Rate
Loan on the last day of the related Alternate Base Rate
Period shall be due and payable on the following day.
Except as otherwise provided in Section 3.13, the unpaid
------ ----
principal amount of any Alternate Base Rate Loan shall
bear interest at a fluctuating rate per annum equal to the
Alternate Base Rate. Each change in the interest rate
hereunder shall take effect simultaneously with the
corresponding change in the Alternate Base Rate. Each
change in the Alternate Base Rate shall be effective as of
the Banking Day on which the change in the Alternate Base
Rate is announced, unless otherwise specified in such
announcement, in which case the change shall be effective
as so specified.
(c) Interest accrued on each Eurodollar Rate Loan
which is for a term of three months or less shall be due
and payable on the last day of the related Eurodollar
Period. Interest accrued on each other Eurodollar Rate
Loan shall be due and payable on the date which is three
months after the date such Eurodollar Rate Loan was made
and on the last day of the related Eurodollar Period.
Except as otherwise provided in Section 3.13, the unpaid
------ ----
principal amount of any Eurodollar Rate Loan shall bear
interest at a rate per annum equal to the Eurodollar Rate
for that Eurodollar Rate Loan plus the Applicable
----
Eurodollar Rate Spread.
(d) If not sooner paid, the principal Indebtedness
evidenced by the Notes shall be payable as follows:
(i) the principal amount of each Loan shall be
payable on the last day of the Interest Period for
such Loan;
(ii) the principal Indebtedness evidenced by the
Notes shall be immediately payable in Cash, to the
extent that the Syndicated Outstandings exceeds at
any time the Commitment as then in effect; and
(iii) the principal Indebtedness evidenced by the
Notes shall in any event be payable in Cash on the
Maturity Date.
(e) The Notes may, at any time and from time to
time, voluntarily be prepaid at the election of Borrower
in whole or in part without premium or penalty; provided
--------
that: (i) any partial prepayment of Alternate Base Rate
Loans shall be in an amount which is an integral multiple
of $1,000,000, (ii) any partial prepayment of a
Eurodollar Rate Loan shall be in an amount not less than
$5,000,000 which is an integral multiple of $1,000,000,
(iii) the Administrative Agent must have received written
notice (or telephonic notice confirmed promptly in
writing) of any prepayment at least one Banking Day
before the date of prepayment in the case of Alternate
Base Rate Loans, and three Banking Days before the date
of prepayment in the case of Eurodollar Rate Loans,
(iv) each prepayment of principal, except for partial
prepayments on Alternate Base Rate Loans, shall be
accompanied by prepayment of interest accrued through the
date of payment on the amount of principal paid, and
(v) in the case of any prepayment of any Eurodollar Rate
Loan, Borrower shall promptly upon demand reimburse each
Bank for any loss or cost directly or indirectly
resulting from the prepayment, determined as set forth in
Sections 3.10 and 3.12.
---- ----
3.2 Administration Fees. Borrower shall pay to the
-------------------
Administrative Agent administration fees at the times and in
the amounts heretofore agreed upon by letter agreement between
Borrower and the Administrative Agent. Such fees are for the
services of the Administrative Agent in administering the
credit facilities under this Agreement and are earned when due.
The administration fees paid to the Administrative Agent are
solely for its own account and are nonrefundable.
3.3 Syndication Fees. Borrower shall pay to the
----------------
Syndications Agent syndication fees at the times and in the
amounts heretofore agreed upon by letter agreement between
Borrower and the Syndications Agent. Such fees are for the
services of the Syndications Agent in syndicating the credit
facilities under this Agreement and are earned when due. The
syndication fees paid to the Syndications Agent are solely for
its own account and are nonrefundable.
3.4 Documentation Fees. Borrower shall pay to the
------------------
Documentation Agent documentation fees at the times and in the
amounts heretofore agreed upon by letter agreement between
Borrower and the Documentation Agent. Such fees are for the
services of the Documentation Agent in documenting the credit
facilities under this Agreement and are earned when due. The
documentation fees paid to the Documentation Agent are solely
for its own account and are nonrefundable.
3.5 Upfront Fees. On the Closing Date, Borrower shall
------------
pay to the Administrative Agent, for the account of each Bank,
an upfront fee as set forth in the letter from the Syndications
Agent (approved by Borrower) to that Bank inviting it to join
the credit facilities under this Agreement. Such upfront fee
is for the participation of the Banks in the credit facilities
under this Agreement and is earned on the Closing Date.
3.6 Commitment Fees. From the Closing Date through the
---------------
day prior to the Maturity Date, Borrower shall pay to the
Administrative Agent, for the account of each Bank pro rata
according to that Bank's Pro Rata Share of the Commitment, a
commitment fee equal to the Applicable Commitment Fee Rate
times the average daily Unused Commitment. The commitment fee
- -----
shall accrue daily and be payable quarterly in arrears on the
day following each Quarterly Payment Date. The Administrative
Agent shall calculate the commitment fee and the amount thereof
allocable to each Bank according to that Bank's Pro Rata Share
of the Commitment and shall notify Borrower in writing of such
amounts. The amount of each commitment fee received by the
Administrative Agent for the account of a Bank shall be
promptly paid by the Administrative Agent to that Bank in
immediately available funds.
3.7 Letter of Credit Fees.
---------------------
(a) On the Closing Date and on the day following
each Quarterly Payment Date which occurs while any Initial
Letter of Credit remains outstanding, Borrower shall pay
to the Issuing Bank an initial letter of credit fee equal
to the Applicable Standby Letter of Credit Fee Rate per
annum times the face amount of each such Initial Letter of
-----
Credit for the period through the earlier of the
expiration date of such Letter of Credit or the next
Quarterly Payment Date. Such initial letter of credit
fees are for the account of each Bank, according to that
Bank's Pro Rata Share of the Commitment. Each initial
letter of credit fee is earned when due and is
nonrefundable. The Issuing Bank shall promptly make
available to the Administrative Agent in immediately
available funds, and the Administrative Agent shall
promptly make available to the Banks in immediately
available funds, according to each Bank's Pro Rata Share
of the Commitment, the initial letter of credit fee.
(b) Upon issuance of each Standby Letter of Credit
(other than an Initial Letter of Credit), and on the day
----- ----
following each Quarterly Payment Date which occurs while
such Standby Letter of Credit remains outstanding,
Borrower shall pay to the Issuing Bank a standby letter of
credit fee equal to the Applicable Standby Letter of
Credit Fee Rate per annum times the face amount of such
-----
Standby Letter of Credit for the period through the
earlier of the expiration date of such Letter of Credit or
the next Quarterly Payment Date, which standby letter of
credit fee is for the account of the Banks according to
each Bank's Pro Rata Share of the Commitment. Borrower
shall also concurrently pay to the Issuing Bank a standby
letter of credit issuance fee equal to 1/10 of 1%
(10 basis points) times the face amount of such Standby
-----
Letter of Credit through the earlier of the expiration
date of such Letter of Credit or the next Quarterly
Payment Date, which standby letter of credit issuance fee
is solely for the account of the Issuing Bank. Each
standby letter of credit fee and standby letter of credit
issuance fee is earned when due as aforesaid and is
nonrefundable. The Issuing Bank shall promptly make
available to the Administrative Agent in immediately
available funds, and the Administrative Agent shall
promptly make available to the Banks in immediately
available funds, according to each Bank's Pro Rata Share
of the Commitment, the standby letter of credit fee which
is for the account of the Banks as aforesaid.
(c) Borrower shall pay, or cause to be paid, to the
Issuing Bank letter of credit fees with respect to each
Commercial Letter of Credit equal to 1/4 of 1% (25 basis
points) of each amount drawn by the beneficiary of such
Commercial Letter of Credit (subject to a minimum fee of
$100 per amount so drawn), payable concurrently with the
amount so drawn. The letter of credit fees with respect
to Commercial Letters of Credit are solely for the account
of the Issuing Bank.
3.8 Increased Commitment Costs. Upon notice from any
--------------------------
Bank (with a copy to the Administrative Agent), Borrower
forthwith shall reimburse such Bank for any increase in the
costs of such Bank relating to any fees, premiums, assessments,
charges and/or reserve or capital adequacy requirements imposed
or requested subsequent to the Closing Date by any Governmental
Agency (whether or not having the force of Law) against credit
commitments of such Bank that is attributed by such Bank, using
any reasonable attribution method, from time to time, to its
Pro Rata Share of the Commitment or any Letter of Credit;
provided that Borrower shall not be obligated to pay any such
- --------
amount which arose prior to the date which is ninety (90) days
preceding the date of such notice, or is attributable to
periods prior to the date which is ninety (90) days preceding
the date of such notice. Such Bank's notice shall set forth
the basis on which it has been determined that such an amount
is due from Borrower, a calculation of the amount due, and a
certification that the corresponding costs have been incurred
by the Bank. Borrower shall have the right to remove a Bank as
a party to this Agreement in accordance with Section 11.23 if
-----
Borrower becomes obligated under this Section to pay any
significant amount to that Bank; provided that Borrower has
--------
paid such amount to that Bank and that such removal is
accomplished within the sixty (60) day period following the
date of such payment.
3.9 Eurodollar Fees. So long as any Bank may be required
---------------
to maintain reserves against "eurocurrency liabilities" under
Regulation D, Borrower shall pay to that Bank a Eurodollar fee
that shall be calculated by applying an annual rate determined
from the formula set forth below against that Bank's share of
the principal amount of each Eurodollar Rate Loan made by that
Bank for the term of that Eurodollar Period:
------------ -------------
( )
( Eurodollar Rate for that ) Eurodollar Rate
( Eurodollar Rate Loan ) - for that Eurodollar
----------------------------------
( 1-Eurodollar Reserve Percentage ) Rate Loan
(------------ -------------)
Amounts payable to any Bank under this Section shall be
determined solely by that Bank based upon the assumption that
the Bank funded 100% of its share of each Eurodollar Rate Loan
in the Designated Eurodollar Market for a corresponding amount
and term, regardless of whether that Bank did so in fact. In
the event of any change in the rate of reserve requirements for
that Bank under Regulation D during the term of any Eurodollar
Rate Loan, or any variation in those requirements based upon
amounts or kinds of assets or liabilities, or other factors,
that Bank may use any reasonable attribution and/or averaging
method it deems appropriate and practical for determining the
rate of reserve requirements for that Bank that shall be used
in the computation of the formula set forth above. Each Bank
shall notify Borrower of the amount of its Eurodollar fee for
each Eurodollar Rate Loan within 90 days after the last day of
its term and Borrower shall pay that Eurodollar fee within
30 days after its receipt of the notice. Any such notice from
a Bank shall set forth the basis on which it has been
determined that such an amount is due from Borrower, a
calculation of the amount due, and a certification that the
corresponding costs have been incurred by the Bank.
3.10 Eurodollar Costs. Upon notice from any Bank,
----------------
Borrower shall promptly reimburse that Bank for any increase in
its costs, including without limitation taxes (other than any
tax, or changes in the rate of any tax, based upon the income,
profits or business of that Bank, or upon any personal property
or franchise of that Bank, or any similar tax which may be
levied upon that Bank, or any change in the rate of any such
similar tax by the United States, or any other government
having jurisdiction, or any political subdivision or taxing
authority of any thereof, and other than a withholding tax
covered by Section 3.16), fees, charges, and/or reserve
----
requirements directly or indirectly resulting from or relating
to any Eurodollar Rate Loan made by that Bank due to any
circumstance, including any payment of principal or interest on
a date other than the due date. As used in the preceding
sentence, "reserve requirements" shall be calculated after
taking into account any compensation received by that Bank
through any Eurodollar fee paid to that Bank. Amounts payable
to any Bank under this Section shall be determined solely by
that Bank upon the assumption that Bank funded 100% of its
share of that Eurodollar Rate Loan in the Designated
Eurodollar Market for a corresponding amount and term,
regardless of whether that Bank did so in fact. In attributing
any Bank's general costs relating to its eurocurrency operations
to any transaction under this Agreement, or averaging any cost
over a period of time, that Bank may use any reasonable
attribution and/or averaging method it deems appropriate and
practical. Any notice under this Section shall set forth the
basis on which it has been determined that such an amount is due
from Borrower, a calculation of the amount due, and a
certification that the corresponding costs have been incurred by
the Bank.
3.11 Special Eurodollar Circumstances. If any Regulatory
--------------------------------
Development or other circumstance relating to the Eurodollar
Markets shall at any time in the reasonable opinion of any
Bank make it unlawful or impractical for that Bank to fund or
maintain its share of a Eurodollar Rate Loan in the Designated
Eurodollar Market for a corresponding amount or term, or to
continue that funding or maintaining, or to determine or charge
interest rates based upon any appropriate Eurodollar Rate, that
Bank shall promptly notify the Administrative Agent, who shall
notify Borrower and the other Banks, and:
(a) the Majority Banks may then determine that the
then outstanding aggregate principal amounts of any
outstanding Eurodollar Rate Loan shall be redesignated,
prospectively, a Alternate Base Rate Loan and, upon
written notice to Borrower by the Administrative Agent
acting in accordance with such a determination by the
Majority Banks, each outstanding Eurodollar Rate Loan
specified in such notice shall be so redesignated; and
(b) no Eurodollar Rate Loan may be made thereafter
until the Majority Banks determine that to do so would be
lawful or practical.
3.12 Indemnification. Borrower hereby indemnifies the
---------------
Banks against, and agrees to hold the Banks harmless from and
reimburse the Banks on demand for all costs, expenses, claims,
penalties, liabilities, losses, legal fees and damages (including
without limitation any interest paid or that will be paid
by the Banks for deposits in Dollars in the Designated
Eurodollar Market and any loss sustained or that will be
sustained by the Banks in connection with the reemployment of
funds) incurred or sustained, or that will be incurred or
sustained, by the Banks, as reasonably determined by the Banks,
as a result of the prepayment of a Eurodollar Rate Loan prior to
the last day of its Eurodollar Period or any failure of Borrower
to consummate, or the failure by Borrower to satisfy any
condition required for the consummation of, any Eurodollar
Rate Loan on the date or in the amount specified in any notice
requesting or designating a Eurodollar Rate Loan. Any such
indemnification shall be determined as though the Banks had
funded or would have funded (in the case of a failure to borrow)
100% of such Eurodollar Rate Loan in the Designated Eurodollar
Market. Any request for indemnification under this Section shall
set forth the basis on which it has been determined that an
amount is due from Borrower, a calculation of the amount due and
a certification that the corresponding amount has been incurred
or suffered by the Bank. Such determination of such expense,
claim, penalty, liability, loss, fee, damage or other charge
shall be presumed correct unless Borrower demonstrates that the
same is erroneous.
3.13 Late Payments. Should any installment of principal
-------------
or interest under the Notes or any other amount payable under
any Loan Document not be paid when due, it shall thereafter
bear interest at a fluctuating interest rate per annum at all
times equal to the sum of the Alternate Base Rate plus 2%, to
----
the extent permitted by applicable Law, until paid in full
(whether before or after judgment).
3.14 Computation of Interest and Fees. All computations
--------------------------------
of interest and fees hereunder shall be calculated on the basis
of a year of 365 days or 366 days, as the case may be, and the
actual number of days elapsed, except that computations of
------
interest and eurocurrency fees on all Eurodollar Rate Loans
shall be calculated on the basis of a year of 360 days and an
actual day month. Any Loan that is repaid on the same day on
which it is made shall bear interest for one day.
3.15 Holidays. If any interest or principal payment to
--------
be made by Borrower on a Alternate Base Rate Loan shall come due
on a day other than a Banking Day, payment shall be made on the
next succeeding Banking Day and the extension of time (in the
case of a principal payment) shall be reflected in computing
interest. If any interest or principal payment to be made by
Borrower on a Eurodollar Rate Loan shall come due on a day
other than a Designated Eurodollar Market Day, payment shall be
made on the next preceding or succeeding Designated Eurodollar
Market Day as determined by the Administrative Agent in
accordance with the then current banking practice in the
Designated Eurodollar Market and the adjustment shall be
reflected in computing interest. If payment of any fee or
other amount payable by Borrower under the Loan Documents shall
come due on a day other than a Banking Day, payment shall be
made on the next succeeding Banking Day.
3.16 Payment Free of Taxes. Any payments made by any
---------------------
Party under the Loan Documents shall be made free and clear of,
and without reduction by reason of, any tax, assessment or
other change imposed by any Governmental Agency, central bank
or comparable authority (other than taxes on income or gross
receipts generally applicable to banks). To the extent that
Borrower is obligated by applicable Laws to make any deduction
or withholding on account of taxes, assessments or other
charges imposed by any Governmental Agency from any amount
payable to any Bank under this Agreement, Borrower shall
(a) make such deduction or withholding and pay the same to the
relevant Governmental Agency and (b) pay such additional amount
to that Bank as is necessary to result in that Bank's receiving
a net after-tax (or after-assessment or after-charge) amount
equal to the amount to which that Bank would have been entitled
under this Agreement absent such deduction or withholding. If
and when receipt of such payment results in an excess payment
or credit to that Bank on account of such taxes, assessments or
other charges, that Bank shall refund such excess to Borrower.
Each Bank that is incorporated under the Laws of a jurisdiction
other than the United States of America or any state thereof
shall deliver to Borrower, with a copy to the Administrative
Agent, within twenty days after the Closing Date, a certificate
signed by a Responsible Official of that Bank to the effect
that such Bank is entitled to receive payments of interest and
other amounts payable under this Agreement without deduction or
withholding on account of United States of America federal
income taxes, which certificate shall be accompanied by two
copies of Internal Revenue Service Form 1001 or Form 4224, as
applicable, also executed by a Responsible Official of that
Bank. Each such Bank agrees (i) promptly to notify Borrower if
any fact set forth in such certificate ceases to be true and
correct and (ii) to take such steps as may be reasonably
necessary to avoid any requirement of applicable Laws that
Borrower make any deduction or withholding for taxes from amounts
payable to that Bank under this Agreement. Borrower shall have
the right to remove a Bank as a party to this Agreement in
accordance with Section 11.23 if Borrower becomes obligated
-----
under this Section to pay any significant amount and the event
or condition causing such payment has continued for not less
than 90 days; provided that Borrower has paid such amount to
--------
that Bank and that such removal is accomplished within the
sixty (60) day period following the date of such payment.
3.17 Funding Sources. Nothing in this Agreement shall be
---------------
deemed to obligate any Bank to obtain the funds for its share
of any Loan in any particular place or manner or to constitute
a representation by any Bank that it has obtained or will
obtain the funds for its share of any Loan in any particular
place or manner.
3.18 Failure to Charge Not Subsequent Waiver. Any
---------------------------------------
decision by any Bank not to require payment of any fee or costs,
or to reduce the amount of the payment required for any fee or
costs, or to calculate any fee or any cost in any particular
manner, shall in no way limit or be deemed a waiver of any
Bank's right to require full payment of any fee or costs, or to
calculate any fee or any costs in any other manner.
3.19 Pro Rata Treatment. Each payment and prepayment of
------------------
principal on a Loan shall be made pro rata according to the
unpaid principal amount of such Loan held by each Bank.
3.20 Time and Place of Payments; Evidence of Payments.
------------------------------------------------
The amount of each payment hereunder, under the Notes or under
any Loan Document (except as may be provided to the contrary in
------
that Loan Document) shall be made to the Administrative Agent
at the Administrative Agent's Office, for the account of each
of the Banks or the Administrative Agent, as the case may be,
in lawful money of the United States of America and in
immediately available funds not later than 10:00 a.m.,
Los Angeles time, on the day of payment (which must be a Banking
Day). If Borrower instructs the Administrative Agent to debit
the Designated Deposit Account for the amount of any such payment
on or before 10:00 a.m., Los Angeles time, on a Banking Day,
payment of such amount shall be deemed received before
10:00 a.m. on such Banking Day; provided that the Designated
--------
Deposit Account has a credit balance in collected funds at
least equal to the amount of such payment prior to the close of
business for the Administrative Agent on such Banking Day. All
such payments received after 10:00 a.m., Los Angeles time, on
any Banking Day, shall be deemed received on the next succeeding
Banking Day. The amount of all payments received by the
Administrative Agent for the account of a Bank shall be
promptly paid by the Administrative Agent to that Bank in
immediately available funds. Each Bank shall use its best
efforts to keep a record of Loans made by it and payments of
principal with respect to each Note, and such record shall be
presumptive evidence of the principal amount owing under such
Note.
3.21 Administrative Agent's Right to Assume Payments
-----------------------------------------------
Will be Made. Unless the Administrative Agent shall have been
- ------------
notified by Borrower prior to the date on which any payment to
be made by Borrower hereunder is due that Borrower does not
intend to remit such payment, the Administrative Agent may, in
its discretion, assume that Borrower has remitted such payment
when so due and the Administrative Agent may, in its discretion
and in reliance upon such assumption, make available to each
Bank on such payment date an amount equal to such Bank's share
of such assumed payment. If Borrower has not in fact remitted
such payment to the Administrative Agent, each Bank shall
forthwith on demand repay to the Administrative Agent the
amount of such assumed payment made available to such Bank,
together with interest thereon in respect of each day from and
including the date such amount was made available by the
Administrative Agent to such Bank to the date such amount is
repaid to the Administrative Agent at the Federal Funds Rate.
3.22 Survivability. All of Borrower's obligations under
-------------
this Article 3 shall survive for six months following the date
---------
on which all Loans hereunder were fully paid.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
------------------------------
Borrower represents and warrants to the Banks that:
4.1 Existence and Qualification; Power; Compliance with
---------------------------------------------------
Law. Borrower is a corporation duly organized, validly existing
- ---
and in good standing under the Laws of Michigan, with no
limit on the duration of its existence. Borrower is duly
qualified or registered to transact business as a foreign
corporation in the States of California, Nevada and in each
other jurisdiction in which the conduct of its business or the
ownership of its properties makes such qualification or
registration necessary, except where the failure so to qualify or
------
register would not constitute a Material Adverse Effect.
Borrower has all requisite corporate power and authority to
conduct its business, to own and lease its Properties and to
execute, deliver and perform all of its obligations under the
Loan Documents. All outstanding shares of capital stock of
Borrower are duly authorized, validly issued, fully paid,
nonassessable, and were issued in compliance with all applicable
state and federal securities and other Laws. Borrower is in
substantial compliance with all Laws and other legal requirements
applicable to its business, has obtained all authorizations,
consents, approvals, orders, licenses and permits from, and has
accomplished all filings, registrations and qualifications with,
or obtained exemptions from any of the foregoing from, any
Governmental Agency that are necessary for the transaction of its
business, except where the failure so to comply, file, register
------
or obtain exemptions does not constitute a Material Adverse
Effect.
4.2 Authority; Compliance with Other Instruments and
------------------------------------------------
Government Regulations. The execution, delivery, and
- ----------------------
performance by Borrower, and by each Significant Subsidiary, of
the Loan Documents to which it is a Party have been duly
authorized by all necessary corporate action, and do not:
(a) require any consent or approval not heretofore
obtained of any stockholder, partner, security holder, or
creditor of such Party;
(b) violate or conflict with any provision of such
Party's charter, certificate, articles of incorporation or
bylaws;
(c) result in or require the creation or imposition
of any Lien or Right of Others upon or with respect to any
Property now owned or leased or hereafter acquired by such
Party;
(d) constitute a "transfer of an interest" or an
"obligation incurred" that is avoidable by a trustee under
Section 548 of the Bankruptcy Code of 1978, as amended, or
constitutes a "fraudulent transfer" or "fraudulent
obligation" within the meaning of the Uniform Fraudulent
Transfer Act as enacted in any jurisdiction or any
analogous Law;
(e) violate any Requirement of Law applicable to
such Party; or
(g) result in a breach of or constitute a default
under, or cause or permit the acceleration of any
obligation owed under, any indenture or loan or credit
agreement or any other Contractual Obligation to which
such Party or any of its Property is bound or affected;
and neither Borrower nor any Subsidiary of Borrower is in
violation of, or default under, any Requirement of Law or
Contractual Obligation, or any indenture, loan or credit
agreement described in Section 4.2(f) in any respect that would
------
constitute a Material Adverse Effect.
4.3 No Governmental Approvals Required. Except such as
----------------------------------
have heretofore been obtained, no authorization, consent,
approval, order, license or permit from, or filing, registration,
or qualification with, or exemption from any of the
foregoing from, any Governmental Agency is or will be required
to authorize or permit the execution, delivery, and performance
by Borrower or any Subsidiary of Borrower of the Loan Documents
to which it is a Party.
4.4 Subsidiaries.
------------
(a) Schedule 4.4 correctly sets forth the names, the
------------
form of legal entity and jurisdictions of organization of
all Subsidiaries of Borrower and designates which of such
Subsidiaries is a Restricted Subsidiary, an Unrestricted
Subsidiary or a Significant Subsidiary as of the Closing
Date. Except as described in Schedule 4.4 or
------------
Schedule 6.4, Borrower does not own any capital stock or
------------
equity interest in any Person that is not a Subsidiary.
Schedule 4.4 describes in full all classes and amounts of
------------
capital stock of each Significant Subsidiary that is
either outstanding or authorized. Unless otherwise
indicated in Schedule 4.4, all of the outstanding shares
------------
of capital stock, or all of the units of equity interest,
as the case may be, of each Subsidiary indicated thereon
are owned of record and beneficially by Borrower, and all
such shares or equity interests so owned are duly
authorized, validly issued, fully paid, non-assessable,
and were issued in compliance with all applicable state
and federal securities and other Laws, and are free and
clear of all Liens and Rights of Others, except for
------
Permitted Encumbrances and Permitted Rights of Others.
(b) Each Significant Subsidiary is a legal entity of
the form described for that Subsidiary in Schedule 4.4,
------------
duly organized, validly existing, and in good standing
under the Laws of its jurisdiction of organization, is
duly qualified to do business as a foreign organization
and is in good standing as such in each jurisdiction in
which the conduct of its business or the ownership or
leasing of its properties makes such qualification
necessary (except where the failure to be so duly
------
qualified and in good standing does not constitute a
Material Adverse Effect) and has all requisite power and
authority to conduct its business and to own and lease its
Properties.
(c) Each Significant Subsidiary is in substantial
compliance with all Laws and other requirements applicable
to its business and has obtained all authorizations,
consents, approvals, orders, licenses, and permits from,
and each such Subsidiary has accomplished all filings,
registrations, and qualifications with, or obtained
exemptions from any of the foregoing from, any
Governmental Agency that are necessary for the transaction
of its business, except where the failure so to comply,
------
file, register, qualify or obtain exemptions does not
constitute a Material Adverse Effect.
4.5 Financial Statements. Borrower has furnished to each
--------------------
Bank (a) the audited consolidated financial statements of
Borrower and its Subsidiaries as at January 2, 1994 and for
the Fiscal Year then ended, and (b) the unaudited condensed
consolidated financial statements of Borrower and its
Subsidiaries as at October 9, 1994 and for the Fiscal Quarter
then ended. The financial statements described in clauses (a)
---
and (b) are in accordance with the books and records of
---
Borrower and its Subsidiaries, were prepared in accordance with
Generally Accepted Accounting Principles and fairly present in
accordance with Generally Accepted Accounting Principles
consistently applied the consolidated financial condition and
results of operation of Borrower and its Subsidiaries as at the
dates and for the periods covered thereby, subject, in the case
of the financial statements described in clause (b), to normal
---
year-end accruals and audit adjustments.
4.6 No Other Liabilities; No Material Adverse Effect.
------------------------------------------------
Borrower and its Subsidiaries do not have any material
liability or material contingent liability not reflected or
disclosed in the balance sheet described in Section 4.5(b) or
------
the notes to the other financial statements described in
Section 4.5, other than liabilities and contingent liabilities
---
arising in the ordinary course of business subsequent to
October 9, 1994. There has been no event or circumstance occur
that constitutes a Material Adverse Effect since October 9,
1994 or the Closing Date.
4.7 Title to Assets. Borrower and its Subsidiaries have
---------------
good and valid title to all of the assets reflected in the
balance sheet described in Section 4.5(b) (other than assets
------ ----------
disposed of in the ordinary course of business) and all other
assets owned on the Closing Date, free and clear of all Liens
and Rights of Others other than (a) those reflected or
----------
disclosed in the notes to any of the financial statements
described in Section 4.5, (b) immaterial Liens or Rights of
---
Others not required under Generally Accepted Accounting
Principles to be so reflected or disclosed, (c) Liens permitted
pursuant to Section 6.7, (d) Permitted Rights of Others, and
---
(e) such existing Liens or Rights of Others as are described on
Schedule 4.7 hereto.
- ------------
4.8 Intangible Assets. Borrower and its Restricted
-----------------
Subsidiaries own, or possess the unrestricted right to use, all
trademarks, trade names, copyrights, patents, patent rights,
licenses and other intangible assets that are necessary in the
conduct of their businesses as now operated, and no such
intangible asset, to the best knowledge of Borrower, conflicts
with the valid trademark, trade name, copyright, patent, patent
right or intangible asset of any other Person to the extent
that such conflict would constitute a Material Adverse Effect.
4.9 Existing Indebtedness and Guaranty Obligations.
----------------------------------------------
Except as set forth in Schedule 4.9, as of the Closing Date
------------
neither Borrower nor any of its Restricted Subsidiaries has
(a) any Indebtedness owed to any Person in an amount in excess
of $1,000,000 (or in excess of $5,000,000 in the case of a
Capital Lease) or (b) outstanding any Guaranty Obligation with
respect to obligations of another Person in excess of
$1,000,000.
4.10 Governmental Regulation. Neither Borrower nor any
-----------------------
of its Subsidiaries is subject to regulation under the Public
Utility Holding Company Act of 1935, the Investment Company Act
of 1940 or to any other Law limiting or regulating its ability
to incur Indebtedness for money borrowed.
4.11 Litigation. There are no actions, suits, or
----------
proceedings pending or, to the best of Borrower's knowledge,
threatened against or affecting Borrower or any of its
Subsidiaries or any Property of any of them before any
Governmental Agency which are reasonably likely to be
determined adversely to Borrower or its Subsidiary and which,
if so determined (singularly or in the aggregate), would
constitute a Material Adverse Effect.
4.12 Employee Matters. There is no strike, work stoppage
----------------
or labor dispute with any union or group of employees pending
or overtly threatened involving Borrower or any of its
Subsidiaries that would constitute a Material Adverse Effect.
4.13 Binding Obligations. Assuming due execution and
-------------------
delivery by the other parties thereto, each of the Loan
Documents to which Borrower or any Significant Subsidiary is a
Party will, when executed and delivered by Borrower or the
Significant Subsidiary, as the case may be, constitute the
legal, valid, and binding obligation of Borrower or the
Significant Subsidiary, as the case may be, enforceable against
Borrower or the Significant Subsidiary, as the case may be, in
accordance with its terms, except as enforcement may be limited
------
by Debtor Relief Laws or by equitable principles relating to
the granting of specific performance and other equitable
remedies as a matter of judicial discretion.
4.14 No Default. No event has occurred and is
----------
continuing that is a Default or an Event of Default.
4.15 Pension Plans. Schedule 4.15 correctly lists each
------------- -------------
Pension Plan which, as of the Closing Date, Borrower or any of
its ERISA Affiliates maintains or to which, as of the Closing
Date, Borrower or any ERISA Affiliate contributes or is
required to contribute. As of the Closing Date, all
contributions required to be made under any such Pension Plan
have been made to such plan or have been reflected as a
liability on the consolidated balance sheet described in
Section 4.5(b). There is no "accumulated funding deficiency"
------
within the meaning of Section 302 of ERISA or any liability to
the PBGC with respect to any Pension Plan other than a
Multiemployer Plan.
4.16 Tax Liability. Borrower and its Restricted
-------------
Subsidiaries have filed all tax returns which are required to
be filed, and have paid, or made provision for the payment of,
all taxes which have become due pursuant to said returns or
pursuant to any assessment received by Borrower or any
Subsidiary, except (a) such taxes, if any, as are being
------
contested in good faith by appropriate proceedings diligently
pursued, and (b) such taxes the failure of which to pay will
not constitute a Material Adverse Effect.
4.17 Regulation U. Neither Borrower nor any of its
------------
Restricted Subsidiaries is engaged principally, or as one of
its important activities, in the business of extending credit
for the purpose of "purchasing" or "carrying" any "margin
stock" within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System, and no Loan hereunder
will be used to purchase or carry any such margin stock in
violation of Regulation U.
4.18 Disclosure. No written statement made by Borrower,
----------
or any representative of Borrower, to the Banks, or to the
Documentation Agent or Administrative Agent for delivery to the
Banks, in connection with this Agreement or any Loan has
contained, as of the date such written statement was made, any
untrue statement of a material fact (which has not been
corrected as of the Closing Date or, in the case of a written
statement made subsequent to the Closing Date, prior to
reliance thereon by the Banks, in a subsequent written
statement made by Borrower or a representative of Borrower) or
has omitted a material fact (which has not been corrected as of
the Closing Date or, in the case of a written statement made
subsequent to the Closing Date, prior to reliance thereon by
the Banks, in a subsequent written statement made by Borrower
or a representative of Borrower) necessary to make the statements
contained therein not misleading under all the circumstances
existing at the date of such written statement and in the context
in which it was made, including information contained in all
other written statements previously delivered. Nothing in this
Section shall be construed to apply to the financial statements
described in Section 4.5 or to the Projections.
---
4.19 Projections. As of the Closing Date, the
-----------
assumptions upon which the Projections are based are reasonable
and consistent with each other assumption and with all facts
known to Borrower and the Projections are reasonably based on
those assumptions. Nothing in this Section shall be construed
as a representation or warranty as of any date other than the
Closing Date or that the Projections will in fact be achieved
by Borrower.
4.20 Hazardous Materials. Except as described in
-------------------
Schedule 4.20, (a) neither Borrower nor any of the Restricted
- -------------
Subsidiaries at any time has disposed of, discharged, released
or threatened the release of any Hazardous Materials on, from
or under the Real Property in violation of any Hazardous
Materials Law that would individually or in the aggregate
constitute a Material Adverse Effect, (b) to the best knowledge
of Borrower, no condition exists that violates any Hazardous
Material Law affecting any Real Property except for such
violations that would not individually or in the aggregate have
a Material Adverse Effect, (c) no Real Property or any portion
thereof is or has been utilized by Borrower or any of the
Restricted Subsidiaries as a site for the manufacture of any
Hazardous Materials and (d) to the extent that any Hazardous
Materials are used, generated or stored by Borrower or any of
the Restricted Subsidiaries on any Real Property, or
transported to or from such Real Property by Borrower or any of
the Restricted Subsidiaries, such use, generation, storage and
transportation are in compliance in all material respects with
all Hazardous Materials Laws.
ARTICLE 5
AFFIRMATIVE COVENANTS
---------------------
(OTHER THAN INFORMATION AND
--------------------------
REPORTING REQUIREMENTS)
----------------------
As long as any Loan remains unpaid, or any other
Obligation remains unpaid or unperformed, or the Commitment
remains outstanding, Borrower shall, and shall cause each of
its Restricted Subsidiaries to, unless the Administrative Agent
(with the written approval of the Majority Banks) otherwise
consents in writing:
5.1 Payment of Taxes and Other Potential Liens. Pay and
------------------------------------------
discharge promptly, all taxes, assessments, and governmental
charges or levies imposed upon Borrower or any of its
Restricted Subsidiaries, upon their respective Property or any
part thereof, upon their respective income or profits or any
part thereof, except any tax, assessment, charge or levy that
------
is not yet past due, or is being contested in good faith by
appropriate proceedings diligently pursued, as long as Borrower
or its Restricted Subsidiary has established and maintains such
adequate reserves as may be required under Generally Accepted
Accounting Principles for the payment of the tax, assessment,
charge or levy and by reason of such nonpayment no Property of
Borrower or its Restricted Subsidiaries that has a fair market
value of $25,000,000 or more is subject to a risk of loss or
forfeiture and no Material Adverse Effect results.
5.2 Preservation of Existence. Preserve and maintain
-------------------------
their respective existence, licenses, rights, franchises, and
privileges in the jurisdiction of their formation and all
authorizations, consents, approvals, orders, licenses, permits,
or exemptions from, or registrations with, any Governmental
Agency that are necessary for the transaction of their
respective business, and qualify and remain qualified to
transact business in each jurisdiction in which such
qualification is necessary in view of their respective business
or the ownership or leasing of their respective Properties;
provided that (a) the failure to preserve and maintain any
- -------- ----
particular right, franchise, privilege, authorization, consent,
approval, order, license, permit, exemption, or registration,
or to qualify or remain qualified in any jurisdiction, that
does not constitute a Material Adverse Effect will not
constitute a violation of this covenant and (b) nothing in this
Section shall prevent any consolidation or merger or
disposition of assets permitted by Sections 6.2 or 6.3 or shall
--- ---
prevent the termination of the business or existence (corporate
or otherwise) of any Restricted Subsidiary of Borrower which in
the reasonable judgment of the board of directors of Borrower
is no longer necessary or desirable.
5.3 Maintenance of Properties. Maintain, preserve, and
-------------------------
protect all of their respective Properties in good order and
condition, subject to wear and tear in the ordinary course of
business and, in the case of unimproved Properties, damage
caused by the natural elements, and not permit any waste of
their respective Properties, except that the failure to so
------
maintain, preserve or protect any particular Property, or the
permitting of waste on any particular Property, where such
failure or waste with respect to all Properties of Borrower and
its Subsidiaries, in the aggregate, would not constitute a
Material Adverse Effect will not constitute a violation of this
covenant.
5.4 Maintenance of Insurance. Maintain insurance with
------------------------
responsible insurance companies in such amounts (subject to
customary deductibles and retentions) and against such risks as
is usually carried by responsible companies of similar size
engaged in similar businesses and owning similar assets in the
general areas in which Borrower and its Restricted Subsidiaries
operate.
5.5 Compliance with Laws. Comply with all Requirements
--------------------
of Laws noncompliance with which would constitute a Material
Adverse Effect, except that Borrower and its Restricted
------
Subsidiaries need not comply with a Requirement of Law then
being contested by any of them in good faith by appropriate
proceedings diligently pursued.
5.6 Inspection Rights. At any time during regular
-----------------
business hours and as often as requested, permit any Bank or
any employee, agent, or representative thereof to examine,
audit and make copies and abstracts from the records and books
of account of, and to visit and inspect the Properties of
Borrower and its Restricted Subsidiaries, and to discuss the
affairs, finances, and accounts of Borrower and its Restricted
Subsidiaries with any of their officers or employees; provided
--------
that none of the foregoing shall require Borrower to disclose
information respecting its employees or customers which would
violate any Law or shall unreasonably interfere with the normal
business operations of Borrower or any of its Restricted
Subsidiaries.
5.7 Keeping of Records and Books of Account. Keep
---------------------------------------
adequate records and books of account fairly reflecting all
financial transactions in conformity with Generally Accepted
Accounting Principles applied on a consistent basis and all
applicable requirements of any Governmental Agency having
jurisdiction over Borrower or any of its Restricted
Subsidiaries.
5.8 Use of Proceeds. Use the proceeds of all Loans
---------------
solely for working capital and other general corporate purposes
of Borrower and its Restricted Subsidiaries.
5.9 Subsidiary Guaranty. Cause each of its Significant
-------------------
Subsidiaries hereafter formed, acquired or qualifying as a
Significant Subsidiary, to execute and deliver a joinder of the
Subsidiary Guaranty promptly following such formation,
acquisition or qualification.
5.10 Maintenance of Borrower Net Assets. Take such
----------------------------------
actions not prohibited by any Requirement of Law as may be
necessary, including the merger or liquidation of Subsidiaries
---------
of Borrower into Borrower, to result in not less than 90% of
Consolidated Total Assets being held directly by Borrower at
all times.
ARTICLE 6
NEGATIVE COVENANTS
------------------
As long as any Loan remains unpaid or any other
Obligation remains unpaid or unperformed, or the Commitment
remains outstanding, Borrower shall not, and shall cause each
of its Restricted Subsidiaries to not, unless the
Administrative Agent (with the written approval of the Majority
Banks) otherwise consents in writing:
6.1 Payment or Prepayment of Subordinated Obligations.
-------------------------------------------------
Pay or prepay any principal (including sinking fund payments),
interest or any other amount with respect to any of the
Subordinated Obligations or purchase or redeem any Subordinated
Obligation except, so long as there has not occurred and is
------
then continuing any Event of Default:
(a) payment, prepayment, purchase, redemption or
defeasance of any Subordinated Obligation; provided that
--------
(i) giving effect thereto, there remains outstanding
Subordinated Obligations in a principal amount not less
than $100,000,000 or (ii) giving effect thereto, there
remains outstanding Subordinated Obligations in a
principal amount not less than the amount, if any, by
which $100,000,000 exceeds the aggregate net cash
proceeds theretofore or concurrently received by Borrower
from the issuance and sale of Common Stock subsequent to
the Closing Date; and
(b) payment of interest in accordance with the terms
of any Subordinated Obligation.
6.2 Dispositions. Make any Disposition if, giving effect
------------
thereto, the aggregate Net Cash Proceeds of all Dispositions
made in the same Fiscal Year would exceed an amount equal to
ten percent (10%) of Consolidated Total Assets as of the last
day of the immediately preceding Fiscal Year.
6.3 Mergers and Sale of Assets. Merge, consolidate or
--------------------------
amalgamate with or into any Person, or sell all or
substantially all of its assets to any Person, except;
------
(a) a merger with a wholly-owned Subsidiary of
Borrower that has nominal assets and liabilities, the
primary purpose of which is to effect the reincorporation
of Borrower in another state;
(b) mergers, consolidations or amalgamations of a
Subsidiary of Borrower (or Borrower's pro-rata interest
therein) into Borrower (with Borrower as the surviving
corporation) or into any other wholly-owned Subsidiary of
Borrower;
(c) any liquidation of any Subsidiary of Borrower
into Borrower or into a wholly-owned Subsidiary of
Borrower; or
(d) merger of Borrower with another Person
constituting an Acquisition permitted under
Section 6.4(e), provided that (i) Borrower is the
------ --------
surviving corporation, (ii) giving effect to such merger
Borrower will be in compliance with all financial and
other covenants under the Loan Documents, (iii) there does
not exist, and immediately following the effective time
of the merger there will not exist, any Default or Event
of Default.
6.4 Investments and Acquisitions . Make any Acquisition,
----------------------------
or enter into an agreement to make any Acquisition, or make or
suffer to exist any Investment, other than:
----------
(a) Investments consisting of Cash Equivalents;
(b) advances to officers, directors and employees of
Borrower for ordinary corporate purposes or in connection
with their purchase of Common Stock;
(c) Investments of Borrower in any of its
wholly-owned Subsidiaries and Investments of any
Subsidiary of Borrower in Borrower or any of Borrower's
wholly-owned Subsidiaries;
(d) Investments in Meadowdale Foods, Inc. or any of
its Affiliates if Borrower determines that such Investment
is reasonably necessary or desirable in connection with
the enhancement or preservation of, or to avoid the
diminution of, the value of Borrower's theretofore
existing Investments in Meadowdale Foods, Inc. or in
connection with the minimization of its exposure on
theretofore existing indemnity and other contingent
undertakings with respect to Meadowdale Foods, Inc.;
(e) Acquisitions of, or Investments in, a Person
engaged primarily in the business now conducted by
Borrower or in any reasonably related business or in a
business that is or will be a vendor or lessor to Borrower
in the ordinary course of the business now conducted by
Borrower, provided that, giving effect to any such
--------
Acquisition or Investment, the aggregate consideration
paid by Borrower and its Restricted Subsidiaries for all
such Acquisitions made subsequent to the Closing Date
plus the aggregate amount of all such Investments made
----
subsequent to the Closing Date does not exceed 20% of
Consolidated Total Assets as of the last day of the most
recently ended Fiscal Quarter;
(f) Investments of a Person that is the subject of
an Acquisition permitted by clause (e) above held by that
Person on the date of such Acquisition;
(g) Investments consisting of the deferred portion
of the sales price payable to Borrower or any of its
Restricted Subsidiaries upon a disposition of any Property
permitted under this Agreement;
(h) Investments in existence on the Closing Date
disclosed on Schedule 6.4;
------------
(i) Investments consisting of Guaranty Obligations
permitted by Section 6.10; and
----
(j) Investments in Unrestricted Subsidiaries and
other Investments not otherwise permitted under this
Section that do not exceed, in the aggregate outstanding
at any time, $40,000,000.
6.5 ERISA Compliance. (a) Permit any Pension Plan,
---------------
other than a Multiemployer Plan, to incur any material
- ----------
"accumulated funding deficiency," as such term is defined in
Section 302 of ERISA, whether or not waived, or (b) in a manner
which could result in the imposition of a material Lien on any
Property of Borrower or any of its Subsidiaries pursuant to
Section 4068 of ERISA, (i) permit any Pension Plan maintained by
any of them to suffer a Termination Event or (ii) incur
withdrawal liability under any Multiemployer Plan.
6.6 Change in Business. Engage in any business other
------------------ -----
than the businesses substantially as now conducted by Borrower
- ----
and any business reasonably related thereto.
6.7 Liens and Negative Pledges. Create, incur, assume,
--------------------------
or suffer to exist any Lien of any nature upon or with respect
to any of their respective Properties, whether now owned or
hereafter acquired, or enter or suffer to exist any Negative
Pledge, or sell any accounts receivable in a transaction
intended to provide financing to Borrower or its Restricted
Subsidiaries, except:
------
(a) Liens existing on the date hereof and not
required to be disclosed pursuant to Section 4.7 or
---
described in Schedule 4.7, provided that the obligations
------------ --------
secured by such Liens are not increased and that no such
Lien extends to any Property of Borrower or any Restricted
Subsidiary other than the Property subject to such Lien on
the Closing Date;
(b) Liens securing Indebtedness permitted by
Section 6.9(e) that are limited solely to the assets
------
leased or purchased;
(c) Liens under any Loan Document;
(d) Liens arising with respect to substitute real
Property collateral under the Metropolitan Mortgage,
provided real Property of reasonably equivalent value is
--------
simultaneously released from the Lien of the Metropolitan
Mortgage;
(e) Liens on real Property securing New Mortgage
Financings, and on any substitute real Property collateral
thereunder, provided real Property of reasonably
--------
equivalent value is simultaneously released from such
Liens securing New Mortgage Financings;
(f) Liens consisting of deposits or pledges to
secure bids, tenders or contracts (other than contracts
for the payment of money) arising in the ordinary course
of business of Borrower or a Subsidiary of Borrower;
(g) Liens securing, or Negative Pledges benefiting,
obligations of an entity that is the subject of an
Acquisition permitted by Section 6.4(e) in existence prior
------
to the date of such Acquisition;
(h) Liens securing commercial letters of credit and
bankers' acceptances on customary terms arising under
Uncommitted Short Term Facilities;
(i) Sales and securitizations of accounts
receivable, and Liens on accounts receivable arising in
connection therewith, that provide financing to Borrower
of not more than $30,000,000 outstanding at any time;
(j) Negative Pledges benefiting Subordinated
Obligations;
(k) Permitted Encumbrances; and
(l) Liens or Negative Pledges incurred in the
ordinary course of Borrower's business that are not
material to the business or financial condition of
Borrower and its Subsidiaries taken as a whole and that do
not secure or arise with respect to obligations in excess
of $15,000,000 in the aggregate at any one time.
6.8 Sales and Leasebacks. Engage in any sale and
--------------------
leaseback transaction except:
------
(a) a sale and leaseback of Property owned by
Borrower or any of its Subsidiaries on October 9, 1994,
provided that the aggregate fair market value of the
--------
Property which is the subject of all such sales and
leasebacks does not exceed $100,000,000; and
(b) a sale and leaseback of Property acquired by
Borrower or any of its Subsidiaries subsequent to
October 9, 1994, provided that the aggregate acquisition
--------
and improvement costs of the Property which is the subject
of all such sales and leasebacks does not exceed an amount
equal to the sum of (i) $150,000,000 plus (ii) 50% of the
--- ----
sum of (A) the aggregate acquisition and improvement costs
---
of all Property acquired by Borrower or any of its
Restricted Subsidiaries subsequent to the Closing Date
minus (B) $150,000,000.
-----
6.9 Indebtedness. Create, incur, assume or suffer to
------------
exist any Indebtedness except:
------
(a) Indebtedness existing on the date hereof and
described in Schedule 4.9;
------------
(b) Indebtedness under the Loan Documents;
(c) Subordinated Obligations;
(d) Indebtedness under Uncommitted Short Term
Facilities not in excess, as of any date of determination,
of Unused Availability on that date;
(e) Indebtedness consisting of Capital Leases or
incurred to finance the purchase of Property that does
not, as of any date of determination, exceed 5% of
Consolidated Total Assets as of the last day of the most
recently ended Fiscal Quarter;
(f) New Mortgage Financings in an aggregate
principal amount not in excess, as of any date of
determination, of such amount which, when added to the
aggregate principal amount of the Existing Mortgages on
that date (other than any Existing Mortgages to the extent
----- ----
the same will be concurrently paid or refinanced from the
proceeds of such New Mortgage Financings), would be equal
to 15% of Consolidated Total Assets as of the last day of
the most recently ended Fiscal Quarter; provided that
--------
concurrently with the incurrence thereof either (A) at
least 50% of the proceeds thereof are applied to the
payment, prepayment, purchase, redemption or defeasance of
Indebtedness of Borrower (other than under this Agreement)
----- ----
or (B) the Commitment is voluntarily and permanently
reduced by an amount at least equal to 50% of such
proceeds;
(g) Indebtedness not otherwise permitted hereunder
that (i) is not secured by any Lien, or have the benefit
of any Negative Pledge, on any Property of Borrower or any
of its Subsidiaries, (ii) does not have any principal due
and payable (or is subject to mandatory prepayment or
redemption, or redemption at the election of the holder
thereof) prior to the Maturity Date, (iii) is issued
pursuant to documentation containing financial covenants
and events of default not more onerous to Borrower, or
other covenants and non-yield or non-tenor related
provisions not more onerous to Borrower in any material
respect, than those contained in this Agreement and
(iv) giving effect thereto as of the last day of the most
recently ended Fiscal Quarter, would not result in a
Default;
(h) Indebtedness to Borrower or a Subsidiary of
Borrower from a Subsidiary of Borrower;
(i) Indebtedness under any Swap Agreement; provided
--------
that such Swap Agreement was entered into for the purpose
of hedging or managing interest rate exposure with respect
to Indebtedness incurred in the ordinary course of
business; and
(j) Indebtedness of an entity that is the subject of
an Acquisition permitted by Section 6.4(e) in existence
------
prior to the date of such Acquisition, or related to a
fixed asset acquired by Borrower in existence prior to the
date of such acquisition.
6.10 Guaranty Obligations. Create, incur, assume or
--------------------
suffer to exist any Guaranty Obligation, except:
------
(a) Guaranty Obligations described in Schedule 4.9
------------
and any renewals, extensions or refinancings thereof to
the extent of the primary obligations as they exist on the
Closing Date;
(b) the Subsidiary Guaranty;
(c) Guaranty Obligations with respect to any
obligations of a Restricted Subsidiary of Borrower;
(d) Guaranty Obligations with respect to
obligations of a Person in which Borrower or a Restricted
Subsidiary of Borrower holds an equity ownership interest,
but not in excess of the proportion of such obligations
corresponding to the proportion of such equity interests
held by Borrower and its Restricted Subsidiaries;
provided the aggregate obligations covered by all such
--------
Guaranty Obligations do not exceed $15,000,000 at any
time;
(e) Guaranty Obligations consisting of Investments
permitted by Section 6.4(d);
------
(f) Guaranty Obligations of an entity that is the
subject of an Acquisition permitted by Section 6.4(e) in
------
existence prior to the date of such Acquisition; and
(g) Guaranty Obligations not otherwise permitted
hereunder, not exceeding $25,000,000 aggregate exposure at
any time.
6.11 Subsidiary Indebtedness and Guaranty Obligations.
------------------------------------------------
Permit any Restricted Subsidiary to incur any Indebtedness, or
to enter into any Guaranty Obligation with respect to
Indebtedness.
6.12 Transactions with Affiliates. Enter into any
----------------------------
transaction of any kind with any Affiliate of Borrower other
-----
than (a) transactions that result in Subordinated Obligations,
- ----
(b) transactions between or among Borrower and its
wholly-owned Subsidiaries, (c) transactions that have been
approved by a resolution adopted by the board of directors of
Borrower with the favorable vote of a majority of the directors
who have no financial or other interest in the transaction or by
the vote of a majority of the outstanding shares of capital stock
of Borrower and (d) arm's length transactions entered into on
terms and under conditions not less favorable to Borrower or
any of its Subsidiaries than could be obtained from a Person
that is not an Affiliate of Borrower.
6.13 Leverage Ratio. Permit the Leverage Ratio to be, at
--------------
the end of each Fiscal Quarter ending during each Fiscal Year
set forth below, greater than the ratio set forth opposite that
Fiscal Year:
Fiscal Year ending
on or about Ratio
------------------ ---------
December 31, 1995 0.70:1.00
December 31, 1996
and thereafter 0.65:1.00
6.14 Minimum Shareholders' Equity. Permit Shareholders'
----------------------------
Equity to be, at the end of each Fiscal Quarter, less than the
sum of (a) $405,000,000 plus (b) an amount equal to 75% of
- --- ----
Consolidated Net Income for each Fiscal Quarter ending after
October 9, 1994 (without reduction for any deficit Consolidated
Net Income during any such Fiscal Quarter).
6.15 Fixed Charge Coverage Ratio. Permit the Fixed
---------------------------
Charge Coverage Ratio to be, at the end of each Fiscal Quarter,
less than 1.85:1.00.
6.16 Capital Expenditures. Make a Capital Expenditure in
--------------------
any Fiscal Year if to do so would cause Capital Expenditures
made by Borrower and its Subsidiaries during that Fiscal Year
to exceed the Maximum Capital Expenditure Amount applicable to
that Fiscal Year; provided, however, that Borrower may make
-------- -------
Capital Expenditures in accordance with the One-Time Capex
Basket, which Capital Expenditures shall not be counted against
the Maximum Capital Expenditure Amount for the Fiscal Year
ending on or about December 31, 1995.
6.17 Distributions. Make any Distribution during the
-------------
existence of a Default or Event of Default or if, giving effect
to the making of such Distribution, any Default or Event of
Default would exist.
6.18 Amendments. Amend, waive or terminate any provision
----------
in any instrument or agreement governing Subordinated
Obligations if such amendment, waiver or termination would
adversely affect the interests of the Banks under this Agreement.
6.19 Change of Fiscal Year. Change its Fiscal Year
---------------------
without the prior consent of the Administrative Agent, which will
not be unreasonably withheld.
6.20 Hostile Tender Offers. Make any offer to purchase
---------------------
or acquire, or consummate a purchase or acquisition of, 5% or
more of the capital stock of any publicly held corporation or
other publicly held business entity if the board of directors
of such corporation or business entity has notified Borrower
that it opposes such offer or purchase.
ARTICLE 7
INFORMATION AND REPORTING REQUIREMENTS
--------------------------------------
7.1 Financial and Business Information. As long as any
----------------------------------
Loan remains unpaid or any other Obligation remains unpaid or
unperformed, or the Commitment remains outstanding, Borrower
shall, unless the Administrative Agent (with the written
approval of the Majority Banks) otherwise consents in writing,
deliver to each of the Banks at its own expense:
(a) As soon as reasonably possible, and in any event
within 60 days after the close of each Fiscal Quarter of
Borrower (other than the fourth Fiscal Quarter), (i) the
consolidated condensed balance sheet of Borrower and its
Subsidiaries as of the end of such Fiscal Quarter, setting
forth in comparative form the corresponding figures for
the corresponding Fiscal Quarter of the preceding Fiscal
Year, and (ii) the consolidated condensed statements of
operations and cash flow of Borrower and its Subsidiaries
for such Fiscal Quarter and for the portion of the Fiscal
Year ended with such Fiscal Quarter, setting forth in
comparative form the corresponding periods of the
preceding Fiscal Year. Such consolidated condensed
balance sheets and statements shall be prepared in
reasonable detail in accordance with Generally Accepted
Accounting Principles (other than those which require
footnote disclosure of certain matters) consistently
applied, shall be accompanied by a management discussion
and analysis of such statements and the operations of
Borrower during the fiscal periods covered by such
statements, and shall be certified by the principal
financial officer of Borrower, subject to normal year-end
accruals and audit adjustments;
(b) As soon as reasonably possible, and in any event
within 105 days after the close of each Fiscal Year of
Borrower, (i) the consolidated balance sheet of Borrower
and its Subsidiaries as at the end of such Fiscal Year,
setting forth in comparative form the corresponding
figures at the end of the preceding Fiscal Year and
(ii) the consolidated statements of operations, cash flow
and shareholders' equity of Borrower and its Subsidiaries
for such Fiscal Year, setting forth in comparative form
the corresponding figures for the previous Fiscal Year.
Such consolidated balance sheet and statements shall be
prepared in reasonable detail in accordance with Generally
Accepted Accounting Principles consistently applied, and
shall be accompanied by a report and opinion of KPMG Peat
Marwick or other independent certified public accountants
of recognized standing selected by Borrower (to which the
Majority Banks have not reasonably objected), which report
and opinion shall state that the audit of such
consolidated financial statements by such accountants was
made in accordance with generally accepted auditing
standards and that such consolidated financial statements
fairly present the financial position, results of
operations and cash flows of Borrower and its Subsidiaries
subject to no exceptions as to scope of audit and subject
to no other exceptions or qualifications (other than
changes in accounting principles in which the auditors
concur) not approved by the Majority Banks in their
reasonable discretion. Such accountants' report and
opinion shall be accompanied by a certificate stating
that, in conducting the audit examination necessary for
the certification of such financial statements, such
accountants have obtained no knowledge of any Default or
Event of Default hereunder or, if in the opinion of such
accountants, any such Default or Event of Default shall
exist, stating the nature and status of such event, and
setting forth the financial calculations under
Sections 6.13 through 6.16, as of the date of the balance
---- ----
sheet;
(c) Not later than 60 days subsequent to the
commencement of each Fiscal Year, a budget setting forth
the consolidated financial condition and results of
operation, by Fiscal Quarter, of Borrower and its
Subsidiaries for such Fiscal Year, in reasonable detail
and in a form reasonably satisfactory to the
Administrative Agent, together with a description of the
material assumptions used in making such budget and,
within three Banking Days after any significant revision
of such budget is approved by the chief financial officer
of Borrower, a copy of such revision;
(d) Promptly after the receipt thereof by Borrower,
copies of any audit or management reports submitted to it
by independent accountants in connection with any audit,
interim audit or other report submitted to the board of
directors of Borrower or any of its Subsidiaries;
(e) Promptly after the same are available, copies of
each annual report, proxy or financial statement or other
report or communication sent to its stockholders, and
copies of all annual, regular, periodic and special
reports and registration statements which Borrower may
file or be required to file with the Commission or any
similar or corresponding Governmental Agency or with any
securities exchange;
(f) Promptly upon a Senior Officer of Borrower
becoming aware, and in any event within five Banking Days
after becoming aware, of the occurrence of any
(i) "reportable event" (as such term is defined in
Section 4043 of ERISA) or (ii) "prohibited transaction"
(as such term is defined in Section 406 of ERISA or
Section 4975 of the Code) in connection with any Pension
Plan, other than a Multiemployer Plan, or any trust
created thereunder, a written notice specifying the nature
thereof, what action Borrower and any of its Subsidiaries
is taking or proposes to take with respect thereto, and,
when known, any action taken by the Internal Revenue
Service with respect thereto;
(g) Promptly upon a Senior Officer of Borrower
becoming aware, and in any event within five Banking Days
after becoming aware, of the existence of a Default or an
Event of Default, a written notice specifying the nature
and period of existence thereof and what action Borrower
is taking or proposes to take with respect thereto;
(h) Promptly upon a Senior Officer of Borrower
becoming aware, and in any event within five Banking Days
after becoming aware, that the holder of any evidence of
indebtedness or guaranty described in Section 9.1(g) has
------
given notice or taken any other action with respect to a
claimed default or event of default, a written notice
specifying the notice given or action taken by such holder
and the nature of the claimed default or event of default
and what action Borrower is taking or proposes to take
with respect thereto;
(i) Promptly upon a Senior Officer of Borrower
becoming aware, and in any event within three Banking Days
after becoming aware, of the existence of any pending or
threatened litigation or any investigation by any
Governmental Agency that has a reasonable possibility of
being determined adversely to Borrower or any of its
Subsidiaries and, if so determined, would constitute a
Material Adverse Effect; and
(j) Such other data and information as from time to
time may be reasonably requested by any of the Banks.
7.2 Compliance Certificate. As long as any Loan
----------------------
remains unpaid or any other Obligation remains unpaid or
unperformed, or the Commitment remains outstanding, Borrower
shall, unless the Administrative Agent (with the written approval
of the Majority Banks) otherwise consents in writing, deliver to
each of the Banks, not later than 60 days after the close of each
Fiscal Quarter and 105 days after the close of each Fiscal Year,
a Compliance Certificate dated as of the last day of the Fiscal
Quarter or Fiscal Year, as the case may be, (a) setting forth
computations showing, in detail reasonably satisfactory to the
Administrative Agent, whether Borrower and its Subsidiaries were
in compliance with their obligations to the Banks pursuant to
Sections 6.13 through 6.16; (b) stating that a review of the
---- ----
activities of Borrower and its Subsidiaries during such fiscal
period has been made under supervision of the certifying officer
with a view to determining whether during such fiscal period
Borrower and its Subsidiaries performed and observed all their
respective Obligations under the Loan Documents, and either
(i) stating that to the best knowledge of the certifying officer
during such fiscal period Borrower and its Subsidiaries performed
and observed each covenant and condition of the Loan Documents
applicable to them or (ii) if Borrower and its Subsidiaries have
not performed and observed such covenants and conditions,
specifying all such Defaults and their nature and status and
(c) stating, to the best knowledge of the certifying officer,
whether any event or circumstance constituting a Material Adverse
Effect has occurred since the date of the most recent Compliance
Certificate delivered under this Section and, if so, describing
such Material Adverse Effect in reasonable detail.
ARTICLE 8
CONDITIONS
----------
8.1 Initial Advances, etc.. The obligations of the
----------------------
Banks to make the initial Advances and the obligation of the
Issuing Bank to issue the initial Letter of Credit are subject
to the following conditions, each of which shall be satisfied
prior to or concurrently with the making of the initial
Advances, or Letter of Credit:
(a) the Documentation Agent shall have received all
of the following, each dated as of the Closing Date
(unless otherwise specified or unless the Documentation
Agent otherwise agrees) and all in form and substance
satisfactory to the Documentation Agent and legal counsel
for the Documentation Agent:
(1) executed counterparts of this Agreement,
sufficient in number for distribution to the Banks
and Borrower;
(2) the Notes executed by Borrower in favor of
each Bank, each in a principal amount equal to that
Bank's Pro Rata Share of the Commitment;
(3) the Subsidiary Guaranty executed by each
Significant Subsidiary of Borrower;
(4) with respect to Borrower and each
Significant Subsidiary, such documentation as the
Documentation Agent may reasonably require to
establish the due organization, valid existence and
good standing of Borrower and each such Subsidiary,
its qualification to engage in business in each
jurisdiction in which it is engaged in business or
required to be so qualified, its authority to
execute, deliver and perform any Loan Documents to
which it is a Party, and the identity, authority and
capacity of each Responsible Official thereof
authorized to act on its behalf, including, without
---------
limitation, certified copies of articles of
incorporation and amendments thereto, bylaws and
amendments thereto, certificates of good standing
and/or qualification to engage in business, tax
clearance certificates, certificates of corporate
resolutions, incumbency certificates, and the like;
(5) the Opinion of Counsel;
(6) an Officer's Certificate of Borrower
affirming, to the best of his or her knowledge, that
the conditions set forth in Sections 8.1(g) and
------
8.1(h) have been satisfied;
------
(7) the Swing Line Documents executed by
Borrower; and
(8) such other assurances, certificates,
documents, consents or opinions as the Documentation
Agent may reasonably require.
(b) The Administrative Agent shall have been paid
the initial administrative fee pursuant to Section 3.2.
---
(c) The Syndications Agent shall have been paid the
syndication fee pursuant to Section 3.3.
---
(d) The Documentation Agent shall have been paid the
documentation fee pursuant to Section 3.4.
---
(e) The Administrative Agent shall have received,
for the account of the Banks, the upfront fees described
in Section 3.5 and the letter of credit fees with respect
---
to the Initial Letters of Credit pursuant to
Section 3.7(a).
------
(f) The Documentation Agent shall be satisfied that
the Obligations, as that term is defined in the Prior
Syndicated Facilities, have been paid and otherwise
satisfied in full and that the Prior Syndicated Facilities
have been terminated or will be terminated substantially
concurrently on the same day as the Closing Date.
(g) The representations and warranties of Borrower
contained in Article 4 shall be true and correct.
---------
(h) Borrower and its Subsidiaries and any other
Parties shall be in compliance with all the terms and
provisions of the Loan Documents.
(i) The Administrative Agent shall have received a
Request for Loan or Request for Letter of Credit, as
applicable.
8.2 Any Increasing Advance, etc.. The obligations of the
----------------------------
Banks to make any Advance which would increase the aggregate
principal Indebtedness evidenced by the Notes and the
obligation of the Issuing Bank to issue any Letter of Credit are
subject to the following conditions precedent:
(a) the Administrative Agent or the Issuing Bank
shall have received a Request for Loan or Request for
Letter of Credit as the case may be;
(b) the representations and warranties contained in
Article 4 (other than the representations and warranties
--------- ----------
contained in Sections 4.4(a), 4.5, 4.6, 4.7, 4.9, 4.12,
------ --- --- --- --- ----
4.15 and 4.19) shall be true and correct in all material
---- ----
respects on and as of the date of the Loan or Letter of
Credit as though made on and as of that date and no event
or circumstance that constitutes a Material Adverse Effect
shall have occurred since the Closing Date; and
(c) the Administrative Agent shall have received
such other information relating to any matters which are
the subject of Section 8.2(b) or the compliance by
------
Borrower with this Agreement as may reasonably be
requested by the Administrative Agent on behalf of a Bank.
8.3 Any Advance. The obligations of the Banks to make
-----------
any Advance are subject to the conditions precedent that the
representations and warranties contained in Sections 4.13 and
----
4.18 shall be true and correct in all material respects on and as
- ----
of the date of the Advance as though made on and as of that date,
and that there has not occurred an Event of Default that is then
continuing.
ARTICLE 9
EVENTS OF DEFAULT AND REMEDIES UPON EVENTS OF DEFAULT
-----------------------------------------------------
9.1 Events of Default. There will be a default hereunder
-----------------
if any one or more of the following events ("Events of Default")
occurs and is continuing, whatever the reason therefor:
(a) failure to pay any installment of principal on
any of the Notes, or any amount due from Borrower to the
Issuing Bank upon its payment under a Letter of Credit, in
each case on the date when due; or
(b) failure to pay any installment of interest on
any of the Notes, or to pay any fee or other amounts due
to the Issuing Bank, the Administrative Agent, the
Documentation Agent or any Bank hereunder, within five (5)
calendar days after the date when due; or
(c) any failure to comply with Section 6.1; or
---
(d) any failure to comply with Sections 6.3, 6.4,
--- ---
6.7, 6.8, 6.9, 6.10 or 6.11 which shall remain unremedied
--- --- --- ---- ----
for a period of thirty (30) calendar days from the date of
such Default or, if the Majority Banks determine that such
Default constitutes a Material Adverse Effect, such
shorter period as may be specified by the Majority Banks
by written notice to Borrower; or
(e) Borrower or any other Party fails to perform or
observe any other term, covenant, or agreement contained
in any Loan Document on its part to be performed or
observed within the later of (i) thirty (30) calendar days
after notice by the Administrative Agent of such Default
or (ii) if Borrower or such other Party has commenced
efforts to remedy such Default, such period not exceeding
sixty (60) calendar days after notice by the
Administrative Agent of such Default during which Borrower
or such other Party is diligently pursuing such efforts;
or
(f) any representation or warranty in any Loan
Document or in any certificate, agreement, instrument, or
other document made or delivered, on or after the Closing
Date, pursuant to or in connection with any Loan Document
proves to have been incorrect when made in any material
respect and the interests of the Banks under this
Agreement have been materially and adversely affected by
reason of such incorrect representation or warranty; or
(g) Borrower or any of its Significant Subsidiaries
(i) fails to pay the principal, or any principal
installment, of any present or future indebtedness for
borrowed money, or any guaranty of present or future
indebtedness for borrowed money, on its part to be paid,
when due (or within any stated grace period), whether at
the stated maturity, upon acceleration, by reason of
required prepayment or otherwise in excess of $15,000,000
or (ii) fails to perform or observe any other material
term, covenant, or agreement on its part to be performed
or observed, or suffers to exist any condition, in
connection with any present or future indebtedness for
borrowed money, or any guaranty of present or future
indebtedness for borrowed money, in excess of $15,000,000,
if as a result of such failure or such condition any
holder or holders thereof (or an agent or trustee on its
or their behalf) has the right to declare it due before
the date on which it otherwise would become due and such
right continues to exist for 5 calendar days after the
Administrative Agent notifies Borrower to cure the
condition creating such right; or
(h) any Loan Document, at any time after its
execution and delivery and for any reason other than the
agreement of all the Banks or satisfaction in full of all
the Obligations, ceases to be in full force and effect or
is declared by a court of competent jurisdiction to be
null and void, invalid, or unenforceable in any respect
which is, in the reasonable opinion of the Majority Banks,
materially adverse to the interest of the Banks; or any
Party thereto denies that it has any or further liability
or obligation under any Loan Document;
(i) a final judgment against Borrower or any of its
Significant Subsidiaries is entered for the payment of
money in excess of $1,000,000, and remains unsatisfied
without procurement of a stay of execution for sixty (60)
calendar days after the issuance of any writ of execution
or similar legal process or the date of entry of
judgment, whichever is earlier, or in any event after the
date which is five (5) calendar days prior to the
scheduled sale of any assets pursuant to such legal
process; or
(j) Borrower or any Significant Subsidiary of
Borrower institutes or consents to any proceeding under a
Debtor Relief Law relating to it or to all or any part of
its Property, or is unable or admits in writing its
inability to pay its debts as they mature, or makes an
assignment for the benefit of creditors; or applies for or
consents to the appointment of any receiver, trustee,
custodian, conservator, liquidator, rehabilitator, or
similar officer for it or for all or any part of its
property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator, or similar officer
is appointed without the application or consent of that
Person and the appointment continues undischarged or
unstayed for sixty (60) calendar days; or any proceeding
under any Debtor Relief Law relating to any such Person or
to all or any part of its Property is initiated without
the consent of that Person and continues undismissed or
unstayed for sixty (60) calendar days; or
(k) the occurrence subsequent to the Closing Date of
a Termination Event with respect to any Pension Plan if
the aggregate liability of Borrower and its ERISA
Affiliates under ERISA as a result thereof exceeds
$25,000,000; or the complete or partial withdrawal
subsequent to the Closing Date by Borrower or any of its
ERISA Affiliates from any Multiemployer Plan if the
aggregate liability of Borrower and its ERISA Affiliates
as a result thereof exceeds $25,000,000; or (l) the
occurrence of an Event of Default (as such term is or may
hereafter be specifically defined in any other Loan
Document) under any other Loan Document; or (m) any
determination is made by a court of competent jurisdiction
that payment of principal or interest or both is due to
the holder of any Subordinated Obligations which would not
be permitted by Section 6.1 or that any Subordinated
---
Obligation is not subordinated in accordance with its
terms to the Obligations.
9.2 Remedies Upon Event of Default. Without limiting any
------------------------------
other rights or remedies of the Administrative Agent or the Banks
provided for elsewhere in this Agreement or the Loan Documents,
or by applicable Law or in equity, or otherwise:
(a) Upon the occurrence of any Event of Default, and
so long as any such Event of Default shall be continuing
(other than an Event of Default described in
Section 9.1(j)):
------
(i) all commitments to make Advances, issue
Letters of Credit and all other obligations of the
Administrative Agent or the Banks and all rights of
Borrower and any other Parties under the Loan
Documents shall be suspended without notice to or
demand upon Borrower, which are expressly waived by
Borrower, except that the Majority Banks (subject to
------
Section 11.2) may waive the Event of Default or,
----
without waiving, determine, upon terms and conditions
satisfactory to the Majority Banks, to reinstate the
Commitment and make further Advances and issue
Letters of Credit, which waiver or determination
shall apply equally to, and shall be binding upon,
all the Banks;
(ii) the Majority Banks may request the Issuing
Bank to, and the Issuing Bank thereupon shall, demand
the immediate deposit by Borrower of an amount equal
to the aggregate effective face amount of all
outstanding Letters of Credit with the Issuing Bank
as cash collateral for the obligation of Borrower to
make such payments as may be required by Sections
2.4 and 2.5, which amount shall be held by the
--- ---
Issuing Bank as collateral in an interest-bearing
account for the account of Borrower; and
(iii) the Majority Banks may request the
Administrative Agent to, and the Administrative Agent
thereupon shall, declare the unpaid principal of or
unperformed balance of all Obligations due to Banks
hereunder and under the Notes, all interest accrued
and unpaid thereon, and all other amounts payable
under the Loan Documents to be forthwith due and
payable, whereupon the same shall become and be
forthwith due and payable, without protest,
presentment, notice of dishonor, demand, or further
notice of any kind, all of which are expressly waived
by Borrower.
(b) Upon the occurrence of any Event of Default
described in Section 9.1(j):
------
(i) all commitments to make Advances, issue
Letters of Credit and all other obligations of the
Administrative Agent or the Banks and all rights of
Borrower and any other Parties under the Loan
Documents shall terminate without notice to or demand
upon Borrower, which are expressly waived by
Borrower, except that all the Banks may waive the
------
Event of Default or, without waiving, determine, upon
terms and conditions satisfactory to all the Banks,
to reinstate the Commitment and make further Advances
and issue Letters of Credit, which waiver or
determination shall apply equally to, and shall be
binding upon, all of the Banks;
(ii) an amount equal to the aggregate effective
face amount of all outstanding Letters of Credit
shall be immediately deposited by Borrower with the
Issuing Bank as cash collateral for the obligation of
Borrower to make such payments as may be required by
Sections 2.4 and 2.5, which amount shall be held by
--- ---
the Issuing Bank as collateral in an interest-bearing
account for the account of Borrower; and
(iii) the unpaid principal of or unperformed
balance of all Obligations due to the Banks here
under and under the Notes, and all interest accrued
and unpaid on such Obligations, and all other amounts
payable under the Loan Documents shall be forthwith
due and payable, without protest, presentment, notice
of dishonor, demand, or further notice of any kind,
all of which are expressly waived by Borrower.
(c) Upon the occurrence of an Event of Default,
the Banks and the Administrative Agent, or any of
them, without notice to or demand upon Borrower,
which are expressly waived by Borrower, may proceed
to protect, exercise, and enforce their rights and
remedies under the Loan Documents against Borrower or
any other Party and such other rights and remedies as
are provided by Law or equity. The order and manner
in which the rights and remedies of the Banks under
the Loan Documents and otherwise are exercised shall
be determined by the Majority Banks.
(d) All payments received by the Administrative
Agent and the Banks, or any of them, shall be applied
first to the costs and expenses (including attorneys' fees
and disbursements) of the Administrative Agent and
Documentation Agent, acting as Administrative Agent or
Documentation Agent (as applicable), and of the Banks and
thereafter paid pro rata to the Banks in the same
proportion that the aggregate of the unpaid principal
amount owing on the Obligations of Borrower to each Bank,
plus accrued and unpaid interest thereon, bears to the
aggregate of the unpaid principal amount owing on all the
Obligations, plus accrued and unpaid interest thereon.
Regardless of how each Bank may treat the payments for the
purpose of its own accounting, for the purpose of
computing Borrower's Obligations, the payments shall be
applied first, to the costs and expenses of the
-----
Administrative Agent and Documentation Agent, acting as
Administrative Agent or Documentation Agent (as
applicable), and the Banks as set forth above, second, to
------
the payment of accrued and unpaid fees hereunder and
interest on all Obligations to the Banks, to and including
the date of such application (ratably according to the
accrued and unpaid interest on the Loans), third, to the
-----
ratable payment of the unpaid principal of all Obligations
to the Banks, and fourth, to the payment of all other
------
amounts then owing to the Administrative Agent, the
Documentation Agent or the Banks under the Loan Documents.
No application of the payments will cure any Event of
Default or prevent acceleration, or continued
acceleration, of amounts payable under the Loan Documents
or prevent the exercise, or continued exercise, of rights
or remedies of the Banks hereunder or under applicable
Law.
ARTICLE 10
THE ADMINISTRATIVE AGENT
------------------------
10.1 Appointment and Authorization. Each Bank hereby
-----------------------------
irrevocably appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such
powers under the Loan Documents as are delegated to the
Administrative Agent by the terms thereof or are reasonably
incidental, as determined by the Administrative Agent, thereto.
This appointment and authorization does not constitute
appointment of the Administrative Agent as trustee for any Bank
and, except as specifically set forth herein to the contrary, the
Administrative Agent shall take such action and exercise such
powers only in an administrative and ministerial capacity.
10.2 Administrative Agent and Affiliates. The Chase
-----------------------------------
Manhattan Bank, N.A. (and each successor Administrative Agent)
has the same rights and powers under the Loan Documents as any
other Bank and may exercise the same as though it were not the
Administrative Agent; and the term "Bank" or "Banks" includes The
Chase Manhattan Bank, N.A. (and each successor Administrative
Agent) in its individual capacity. The Chase Manhattan Bank,
N.A. (and each successor Administrative Agent) and its respective
Affiliates may accept deposits from, lend money to, and generally
engage in any kind of banking, trust or other business with
Borrower and any Affiliate of Borrower, as if it were not the
Administrative Agent and without any duty to account therefor to
the Banks. The Chase Manhattan Bank, N.A. (and each successor
Administrative Agent) need not account to any other Bank for any
monies received by it for reimbursement of its costs and expenses
as Administrative Agent hereunder, or for any monies received by
it in its capacity as a Bank hereunder, except as otherwise
------
provided herein.
10.3 Banks' Credit Decisions. Each Bank agrees that it
-----------------------
has, independently and without reliance upon the Administrative
Agent, any other Bank, or the directors, officers, agents, or
employees of the Administrative Agent or of any other Bank, and
instead in reliance upon information supplied to it by or on
behalf of Borrower and its Subsidiaries and upon such other
information as it has deemed appropriate, made its own
independent credit analysis and decision to enter into this
Agreement. Each Bank also agrees that it shall, independently
and without reliance upon the Administrative Agent, any other
Bank, or the directors, officers, agents, or employees of the
Administrative Agent or of any other Bank, continue to make its
own independent credit analyses and decisions in acting or not
acting under the Loan Documents.
10.4 Action by Administrative Agent.
------------------------------
(a) The Administrative Agent may assume that no
Event of Default has occurred and is continuing, unless
the Administrative Agent has actual knowledge of the Event
of Default, has received notice from Borrower stating the
nature of the Event of Default, or has received notice
from a Bank stating the nature of the Event of Default and
that Bank considers the Event of Default to have occurred
and to be continuing.
(b) The Administrative Agent has only those
obligations under the Loan Documents that are expressly
set forth therein. Without limitation on the foregoing,
the Administrative Agent shall have no duty to inspect any
property of Borrower or any of its Subsidiaries, although
the Administrative Agent may in its discretion
periodically inspect any property from time to time in
accordance with Section 5.6.
---
(c) Except for any obligation expressly set forth in
the Loan Documents and as long as the Administrative Agent
may assume that no Event of Default has occurred and is
continuing, the Administrative Agent may, but shall not be
required to, exercise its discretion to act or not act,
except that the Administrative Agent shall be required to
------
act or not act upon the instructions of the Majority Banks
(or of all the Banks, to the extent required by
Sections 9.2(b) or 11.2) and those instructions shall be
------ ----
binding upon the Administrative Agent and all the Banks,
provided that the Administrative Agent shall not be
--------
required to act or not act if to do so would expose the
Administrative Agent to significant liability or would be
contrary to any Loan Document or to applicable law.
(d) If the Administrative Agent has received a
notice specified in clause (a), the Administrative Agent
---
shall give notice thereof to the Banks and shall act or
not act upon the instructions of the Majority Banks (or of
all the Banks, to the extent required by Sections 9.2(b)
------
or 11.2), provided that the Administrative Agent shall not
---- --------
be required to act or not act if to do so would be
contrary to any Loan Document or to applicable Law or
would result, in the reasonable judgment of the
Administrative Agent, in substantial risk of liability to
the Administrative Agent, and except that if the Majority
------
Banks (or all the Banks, if required under Sections
9.2(b) or 11.2) fail, for three (3) Banking Days after the
------ ----
receipt of notice from the Administrative Agent, to
instruct the Administrative Agent, then the Administrative
Agent, in its sole discretion, may act or not act as it
deems advisable for the protection of the interests of the
Banks.
(e) The Administrative Agent shall have no liability
to any Bank for acting, or not acting, as instructed by
the Majority Banks (or all the Banks, if required under
Sections 9.2(b) or 11.2), notwithstanding any other
------ ----
provision hereof.
10.5 Liability of Administrative Agent. Neither the
---------------------------------
Administrative Agent nor any of its respective directors,
officers, agents, or employees shall be liable for any action
taken or not taken by them under or in connection with the Loan
Documents, except for their own gross negligence or willful
------
misconduct. Without limitation on the foregoing, the
Administrative Agent and its respective directors, officers,
agents, and employees:
(a) may treat the payee of any Note as the holder
thereof until the Administrative Agent receives notice of
the assignment or transfer thereof in form reasonably
satisfactory to the Administrative Agent, signed by the
payee and may treat each Bank as the owner of that Bank's
interest in the obligations due to Banks for all purposes
of this Agreement until the Administrative Agent receives
notice of the assignment or transfer thereof, in form
reasonably satisfactory to the Administrative Agent,
signed by that Bank;
(b) may consult with legal counsel, in-house legal
counsel, independent public accountants, in-house
accountants and other professionals, or other experts
selected by it, or with legal counsel, independent public
accountants, or other experts for Borrower, and shall not
be liable for any action taken or not taken by it or them
in good faith in accordance with the advice of such legal
counsel, independent public accountants, or experts;
(c) will not be responsible to any Bank for any
statement, warranty, or representation made in any of the
Loan Documents or in any notice, certificate, report,
request, or other statement (written or oral) in
connection with any of the Loan Documents;
(d) except to the extent expressly set forth in the
Loan Documents, will have no duty to ascertain or inquire
as to the performance or observance by Borrower or any
other Person of any of the terms, conditions, or covenants
of any of the Loan Documents or to inspect the property,
books, or records of Borrower or any of its Subsidiaries
or other Person;
(e) will not be responsible to any Bank for the due
execution, legality, validity, enforceability,
genuineness, effectiveness, sufficiency, or value of any
Loan Document, any other instrument or writing furnished
pursuant thereto or in connection therewith;
(f) will not incur any liability by acting or not
acting in reliance upon any Loan Document, notice, con
sent, certificate, statement, or other instrument or
writing believed by it or them to be genuine and signed or
sent by the proper party or parties; and
(g) will not incur any liability for any
arithmetical error in computing any amount payable to or
receivable from any Bank hereunder, including without
limitation payment of principal and interest on the
Notes, payment of commitment fees, Loans, and other
amounts; provided that promptly upon discovery of such an
--------
error in computation, the Administrative Agent, the
Banks, and (to the extent applicable) Borrower shall make
such adjustments as are necessary to correct such error
and to restore the parties to the position that they
would have occupied had the error not occurred.
10.6 Indemnification. Each Bank shall, ratably in
---------------
accordance with the respective principal amount of its Bank
Commitment, indemnify and hold the Administrative Agent and its
directors, officers, agents, and employees harmless against any
and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements of
any kind or nature whatsoever (including, without limitation,
attorney's fees and disbursements) that may be imposed on,
incurred by, or asserted against it or them in any way relating
to or arising out of the Loan Documents (other than losses
incurred by reason of the failure by Borrower to pay the
obligations due to Banks hereunder or under the Notes) or any
action taken or not taken by it as Administrative Agent there-
under to the extent the Administrative Agent has not been
reimbursed therefor by Borrower, except for the Administrative
------
Agent's gross negligence or willful misconduct. Without
limitation on the foregoing, each Bank shall reimburse the
Administrative Agent upon demand for that Bank's ratable share of
any cost or expense incurred by the Administrative Agent in
connection with the negotiation, preparation, execution,
delivery, administration, amendment, waiver, refinancing,
restructuring, reorganization (including a bankruptcy
reorganization), or enforcement of the Loan Documents, to the
extent that Borrower is required by Section 11.3 to pay that cost
----
or expense but fails to do so upon demand. Any such
reimbursement shall not relieve Borrower of its obligations under
Section 11.3.
----
10.7 Successor Administrative Agent. The Administrative
------------------------------
Agent may resign as such at any time by written notice to
Borrower and the Banks, to be effective upon a successor's
acceptance of appointment as Administrative Agent. The Majority
Banks may at any time remove the Administrative Agent by written
notice to that effect to be effective on such date as the
Majority Banks designate. In either event, the Majority Banks
shall appoint a successor Administrative Agent or Administrative
Agent, who must be from among the Banks; provided, that the
--------
Administrative Agent shall be entitled to appoint a successor
Administrative Agent from among the Banks, subject to acceptance
of appointment by that successor Administrative Agent, if the
Majority Banks have not appointed a successor Administrative
Agent within thirty (30) days after the date the Administrative
Agent gave notice of resignation or was removed. Upon a
successor's acceptance of appointment as Administrative Agent,
the successor will thereupon succeed to and become vested with
all the rights, powers, privileges, and duties of the
Administrative Agent under the Loan Documents, and the resigning
or removed Administrative Agent will thereupon be discharged from
its duties and obligations thereafter arising under the Loan
Documents.
10.8 No Obligations of Borrower. Nothing contained in
--------------------------
this Article 10 shall be deemed to impose upon Borrower any
----------
obligation in respect of the due and punctual performance by the
Administrative Agent of its obligations to the Banks under any
provision of this Agreement, and Borrower shall have no liability
to the Administrative Agent or any of the Banks in respect of any
failure by the Administrative Agent or any Bank to perform any of
its obligations to the Administrative Agent or the Banks under
this Agreement. Without limiting the generality of the
foregoing, where any provision of this Agreement relating to the
payment of any amounts due and owing under the Loan Documents
provides that such payments shall be made by Borrower to the
Administrative Agent for the account of the Banks, Borrower's
obligations to the Banks in respect of such payments shall be
deemed to be satisfied upon the making of such payments to the
Administrative Agent in the manner provided by this Agreement.
10.9 No Obligations-Managing Agents. The Administrative
------------------------------
Agent shall not have any obligation to Borrower or any Bank
arising out of the performance or non-performance by the
Documentation Agent of its duties and responsibilities here
under. The Documentation Agent shall not have any obligation to
Borrower or any Bank arising out of the performance or
non-performance by the Administrative Agent of its duties and
responsibilities hereunder.
ARTICLE 11
MISCELLANEOUS
-------------
11.1 Cumulative Remedies; No Waiver. The rights, powers,
------------------------------
and remedies of the Administrative Agent, the Documentation Agent
or any Bank provided herein or in any Note or other Loan Document
are cumulative and not exclusive of any right, power, or remedy
provided by law or equity. No failure or delay on the part of
the Administrative Agent, the Documentation Agent or any Bank in
exercising any right, power, or remedy may be, or may be deemed
to be, a waiver thereof; nor may any single or partial exercise
of any right, power, or remedy preclude any other or further
exercise of any other right, power, or remedy. The terms and
conditions of Sections 8.1, 8.2, and 8.3 hereof are inserted for
--- --- ---
the sole benefit of the Banks and the Documentation Agent (in the
case of Section 8.1) or the Administrative Agent (in the case of
---
Sections 8.2 and 8.3) may (in either case, with the written
--- ---
approval of the Majority Banks) waive them in whole or in part
with or without terms or conditions in respect of any Loan,
without prejudicing the Banks' rights to assert them in whole or
in part in respect of any other Loans.
11.2 Amendments; Consents. No amendment, modification,
--------------------
supplement, termination, or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any
departure by Borrower or any other Party therefrom, may in any
event be effective unless in writing signed by the Administrative
Agent with the approval of the Majority Banks, and then only in
the specific instance and for the specific purpose given; and
without the written approval in writing of all the Banks, no
amendment, modification, supplement, termination, waiver, or
consent may be effective:
(a) to amend or modify the principal of, or the
amount of principal, principal prepayments, or the rate of
interest payable on, any Obligation or the amount of any
Commitment or of any fee payable to any Bank;
(b) to postpone any date fixed for any payment of
principal of, prepayment of principal of, or any
installment of interest on, any Obligation or any
installment of any fee or to extend the term of any
Commitment;
(c) to amend or modify the provisions of the
definition in Section 1.1 of "Majority Banks" or of
---
Sections 2.9, 11.2, 11.9, 11.10, or 11.11;
--- ---- ---- ----- -----
(d) to release any Significant Subsidiary from the
Subsidiary Guaranty except in connection with the sale or
------
other disposition of that Significant Subsidiary which
does not violate Section 6.2 or if it no longer qualifies
---
as a Significant Subsidiary; or
(e) to amend or modify any provision of this
Agreement or the Loan Documents that expressly requires
the consent or approval of all the Banks.
Any amendment, modification, supplement, termination, waiver, or
consent pursuant to this Section 11.2 shall apply equally to, and
----
shall be binding upon, all the Banks, the Documentation Agent and
the Administrative Agent.
11.3 Costs, Expenses and Taxes. Borrower shall pay on
-------------------------
demand the reasonable out-of-pocket costs and expenses of the
Documentation Agent in connection with the negotiation,
preparation, execution and delivery of the Loan Documents
executed and delivered on the Closing Date. Borrower shall pay
on demand the reasonable out-of-pocket costs and expenses of the
Administrative Agent in connection with the amendment or waiver
of any of the Loan Documents that is requested by Borrower,
whether or not granted by the Banks. Borrower shall pay on
demand the reasonable out-of-pocket costs and expenses of the
Administrative Agent (and, if there then exists an Event of
Default, of the Banks) in connection with any refinancing,
restructuring, reorganization (including a bankruptcy
---------
reorganization, if such payment is approved by the bankruptcy
court) of the credit facilities under this Agreement. Borrower
shall in any event pay on demand the reasonable out-of-pocket
costs and expenses of the Administrative Agent and the Banks in
connection with the enforcement of any of the Loan Documents.
The aforesaid costs and expenses shall include without
limitation filing fees, recording fees, title insurance fees,
appraisal fees, search fees, and other out-of-pocket expenses and
the reasonable fees and out-of-pocket expenses of any legal
counsel, independent public accountants, and other outside
experts retained by the Documentation Agent, the Administrative
Agent or any of the Banks. Borrower shall pay any and all
documentary and other taxes (other than income or gross receipts
taxes generally applicable to banks) and all costs, expenses,
fees, and charges payable or determined to be payable in
connection with the filing or recording of this Agreement, any
other Loan Document, or any other instrument or writing to be
delivered hereunder or thereunder, or in connection with any
transaction pursuant hereto or thereto, and shall reimburse, hold
harmless, and indemnify the Documentation Agent, the
Administrative Agent and each Bank from and against any and all
loss, liability, or legal or other expense with respect to or
resulting from any delay in paying or failure to pay any tax,
cost, expense, fee, or charge or that any of them may suffer or
incur by reason of the failure of Borrower to perform any of its
Obligations. Any amount payable to the Documentation Agent, the
Administrative Agent or any Bank under this Section shall bear
interest from the date of receipt of demand for payment at the
Alternate Base Rate.
11.4 Nature of Banks' Obligations. Nothing contained in
----------------------------
this Agreement or any other Loan Document and no action taken by
the Administrative Agent, the Documentation Agent or the Banks or
any of them pursuant hereto or thereto may, or may be deemed to,
make the Banks a partnership, an association, a joint venture, or
other entity, either among themselves or with Borrower. Each
Bank's obligation to make any Advance pursuant hereto is several
and not joint or joint and several, and is not conditioned upon
the performance by any other Bank of its obligation to make
Advances. A default by any Bank will not increase the Commitment
of any other Bank. Any Bank not in default may, if it desires,
assume in such proportion as the nondefaulting Banks agree the
obligations of any Bank in default, but is not obligated to do
so.
11.5 Representations and Warranties. All representations
------------------------------
and warranties of Borrower and any other Party contained herein
or in any other Loan Document (including, for this purpose, all
representations and warranties contained in any certificate or
other writing required to be delivered by or on behalf of
Borrower or such Party pursuant to any Loan Document) will
survive the making of the loans hereunder and the execution and
delivery of the Notes, and, in the absence of actual knowledge by
the Administrative Agent, the Documentation Agent or a Bank of
the untruth of any representation or warranty, have been or will
be relied upon by the Administrative Agent, the Documentation
Agent and each Bank (as the case may be), notwithstanding any
investigation made by the Administrative Agent, the Documentation
Agent or any Bank or on their behalf.
11.6 Notices. Except as otherwise provided in any Loan
-------
Document, (a) all notices, requests, demands, directions, and
other communications provided for hereunder and under any other
Loan Document must be in writing and must be mailed,
telegraphed, delivered, or sent by telecopier or cable to the
appropriate party at the address set forth on the signature pages
of this Agreement or, as to any Party, at any other address as
may be designated by it in the applicable Loan Document or in a
written notice sent to all other parties in accordance with this
Section and (b) any notice, request, demand, direction, or other
communication given by telegram or cable must be confirmed within
48 hours by letter mailed or delivered to the appropriate party
at its respective address. Except as otherwise provided in any
Loan Document if any notice, request, demand, direction, or other
communication is given by mail it will be effective on the third
Banking Day after deposited in the United States mails with first
class or airmail postage prepaid; if given by telegraph or cable,
when delivered to the telegraph company with charges prepaid; if
given by telecopier (with receipt confirmed), when sent; or if
given by personal delivery, when delivered.
11.7 Execution in Counterparts. This Agreement and any
-------------------------
other Loan Document to which Borrower is a Party may be executed
in any number of counterparts and any party hereto or thereto may
execute any counterpart, each of which when executed and
delivered will be deemed to be an original and all of which
counterparts of this Agreement or any other Loan Document, as the
case may be, taken together will be deemed to be but one and the
same instrument. The execution of this Agreement or any other
Loan Document by any party hereto or thereto will not become
effective until counterparts hereof or thereof, as the case may
be, have been executed by all the parties hereto or thereto.
11.8 Binding Effect; Assignment.
--------------------------
(a) This Agreement and the other Loan Documents to
which Borrower is a Party will be binding upon and inure
to the benefit of Borrower, the Administrative Agent, the
Documentation Agent, each of the Banks, and their
respective successors and assigns, except that except as
------
permitted in Section 6.3, Borrower may not assign its
---
rights hereunder or thereunder or any interest herein or
therein without the prior written consent of all the
Banks. Each Bank represents that it is not acquiring its
Note with a view to the distribution thereof within the
meaning of the Securities Act of 1933, as amended (subject
to any requirement that disposition of such Note must be
within the control of such Bank). Any Bank may at any
time pledge its Note or any other instrument evidencing
its rights as a Bank under this Agreement to a Federal
Reserve Bank, but no such pledge shall release that Bank
from its obligations hereunder or grant to such Federal
Reserve Bank the rights of a Bank hereunder absent
foreclosure of such pledge.
(b) From time to time following the Closing Date,
each Bank may assign to one or more Eligible Assignees all
or any portion of its Pro Rata Share of the Commitment;
provided that (i) such Eligible Assignee, if not then a
--------
Bank, shall be reasonably acceptable to the Administrative
Agent, (ii) such assignment shall be evidenced by a
Commitment Assignment and Acceptance, a copy of which
shall be furnished to the Administrative Agent for
registration as hereinbelow provided, (iii) unless the
Administrative Agent otherwise consents, the assignment
shall not assign a Pro Rata Share of the Commitment
equivalent to less than $10,000,000 and (iv) the effective
date of any such assignment shall be as specified in the
Commitment Assignment and Acceptance, but not earlier than
the date which is five (5) Banking Days after the date the
Administrative Agent has registered the Commitment
Assignment and Acceptance in the register kept for that
purpose by the Administrative Agent described below. Upon
the effective date of such Commitment Assignment and
Acceptance, the Eligible Assignee named therein shall be a
Bank for all purposes of this Agreement, with the Pro Rata
Share of the Commitment therein set forth and, to the
extent of such Pro Rata Share, the assigning Bank shall be
released from its obligations under this Agreement.
Borrower agrees that it shall execute and deliver (against
delivery by the assigning Bank to Borrower of its Note) to
such assignee Bank, a Note evidencing that assignee Bank's
Pro Rata Share of the Commitment, and to the assigning
Bank, a Note evidencing the remaining balance Pro Rata
Share retained by the assigning Bank.
(c) By executing and delivering a Commitment
Assignment and Acceptance, the Eligible Assignee
thereunder acknowledges and agrees that: (i) other than
the representation and warranty that it is the legal and
beneficial owner of the Pro Rata Share of the Commitment
being assigned thereby free and clear of any adverse
claim, the assigning Bank has made no representation or
warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in
connection with this Agreement or the execution, legality,
validity, enforceability, genuineness or sufficiency of
this Agreement or any other Loan Document; (ii) the
assigning Bank has made no representation or warranty and
assumes no responsibility with respect to the financial
condition of Borrower or the performance by Borrower of
the Obligations; (iii) it has received a copy of this
Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 7.1 and
---
such other documents and information as it has deemed
appropriate to make its own credit analysis and decision
to enter into such Commitment Assignment and Acceptance;
(iv) it will, independently and without reliance upon the
Administrative Agent, the Documentation Agent or any 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 this
Agreement; (v) it appoints and authorizes the
Documentation Agent and the Administrative Agent to take
such action and to exercise such powers under this
Agreement as are delegated to the Administrative Agent or
the Documentation Agent by this Agreement; and (vi) it
will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are
required to be performed by it as a Bank.
(d) The Administrative Agent shall maintain at the
Administrative Agent's Office a copy of each Commitment
Assignment and Acceptance delivered to it and a register
for recordation of the names and addresses of the Banks
and their respective Pro Rata Shares of the Commitment.
Upon receipt of a completed Commitment Assignment and
Acceptance executed by any Bank and an Eligible Assignee,
and upon receipt of a registration fee of $3,000 from such
Eligible Assignee, Administrative Agent shall record the
making of the assignments contemplated in such Commitment
Assignment and Acceptance in such register. The entries
in such register shall be conclusive, in the absence of
manifest error, and Borrower, the Administrative Agent and
the Banks may treat each Person whose name is recorded in
the register as a Bank hereunder for all purposes of this
Agreement. Promptly following any entry in the register,
the Administrative Agent shall provide to Borrower and the
Banks a revised Schedule 1.1 giving effect thereto.
------------
(e) Each Bank may from time to time without the
consent of Borrower or the Administrative Agent grant
participations to one or more banks or other financial
institutions in a portion of its Pro Rata Share of the
Commitment; provided, however, that (i) such Bank's
-------- -------
obligations under this Agreement shall remain unchanged,
(ii) such Bank shall remain solely responsible to the
other parties hereto for the performance of such
obligations, (iii) the participating banks or other
financial institutions shall not be a Bank hereunder for
any purpose except, if the participation agreement so
------
provides, for the purposes of Sections 3.8, 3.9, 3.10,
--- --- ----
11.10 and 11.23 but only to the extent that the cost of
----- -----
such benefits to Borrower does not exceed the cost which
Borrower would have incurred in respect of such Bank
absent the participation, (iv) Borrower, the
Administrative Agent and the other Banks shall continue to
deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement,
(v) the consent of the holder of such participation
interest shall not be required for amendments or waivers
of provisions of the Loan Documents other than those which
----------
(A) increase the monetary amount of the Commitment,
(B) extend the Maturity Date or any other date upon which
any payment of money is due to the Banks, (C) reduce the
rate of interest on the Notes, any fee or any other
monetary amount payable to the Banks or (D) release any
Significant Subsidiary from the Subsidiary Guaranty
(except in connection with the sale or other disposition
------
of that Significant Subsidiary which does not violate
Section 6.2 or if it no longer qualifies as a Significant
---
Subsidiary) and (vi) such Bank shall notify the
Administrative Agent in writing of the identity
of the participant and the amount of the participation
interest within five Banking Days after the date granted.
(f) In the event that any Bank is acquired by any
Person, or merges with a Person and such merger results in
a change in control of that Bank (measured by such factors
as the relative stock ownership positions, board of
directors composition and senior management composition of
the merged entity), Borrower may in its sole, absolute and
unfettered discretion exercised not later than the later
-----
of (i) sixty (60) days after the consummation of such
--
acquisition or merger and (ii) sixty (60) days after any
Senior Officer of Borrower has actual knowledge of the
consummation of such acquisition or merger, remove such
Bank in accordance with Section 11.23.
-----
11.9 Sharing of Setoffs. Each Bank severally agrees that
------------------
if it, through the exercise of the right of setoff, banker's
lien, or counterclaim against Borrower or otherwise, receives
payment of the Obligations due it hereunder and under the Notes
that is ratably more than any other Bank, through any means,
receives in payment of the obligations held by that Bank, then:
(a) the Bank exercising the right of setoff, banker's lien, or
counterclaim or otherwise receiving such payment shall purchase,
and shall be deemed to have simultaneously purchased, from the
other Bank a participation in the obligations held by the other
Bank and shall pay to the other Bank a purchase price in an
amount so that the share of the obligations held by each Bank
after the exercise of the right of setoff, banker's lien, or
counterclaim or receipt of payment shall be in the same
proportion that existed prior to the exercise of the right of
setoff, banker's lien, or counterclaim or receipt of payment, and
(b) such other adjustments and purchases of participations shall
be made from time to time as shall be equitable to ensure that
all of the Banks share any payment obtained in respect of the
obligations ratably in accordance with each Bank's share of the
obligations immediately prior to, and without taking into
account, the payment, provided that, if all or any portion of a
--------
disproportionate payment obtained as a result of the exercise of
the right of setoff, banker's lien, counterclaim or otherwise is
thereafter recovered from the purchasing Bank by Borrower or any
Person claiming through or succeeding to the rights of Borrower,
the purchase of a participation shall be rescinded and the
purchase price thereof shall be restored to the extent of the
recovery, but without interest. Each Bank that purchases a
participation in the Obligations pursuant to this Section shall
from and after the purchase have the right to give all notices,
requests, demands, directions and other communications under this
Agreement with respect to the portion of the Obligations
purchased to the same extent as though the purchasing Bank were
the original owner of the Obligations purchased. Borrower
expressly consents to the foregoing arrangements and agrees that
any Bank holding a participation in an Obligation so purchased
may exercise any and all rights of setoff, banker's lien or
counterclaim with respect to the participation as fully as if
the Bank were the original owner of the Obligation purchased;
provided, however, that each Bank agrees that it shall not
- --------
exercise any right of setoff, banker's lien or counterclaim
without first obtaining the consent of the Majority Banks.
11.10 Indemnity by Borrower. Borrower agrees to
---------------------
indemnify, save, and hold harmless the Administrative Agent, the
Documentation Agent, the Issuing Bank and each Bank and their
directors, officers, agents, attorneys, and employees
(collectively, the "indemnitees") from and against: (i) any and
all claims, demands, actions or causes of action that are
asserted against any indemnitee (other than by Borrower or by
another indemnitee) if the claim, demand, action or cause of
action arises out of or relates to the Commitment, the use of
proceeds of any Loans, or the relationship of Borrower and the
Banks under this Agreement or any transaction contemplated
pursuant to this Agreement, (ii) any administrative or
investigative proceeding by any Governmental Agency arising out
of or related to a claim, demand, action or cause of action
described in clause (i) above; and (iii) any and all liabilities,
---
losses, costs, or expenses (including attorneys' fees and
disbursements) that any indemnitee suffers or incurs as a result
of any of the foregoing; provided, that Borrower shall have no
--------
obligation under this Section to the Administrative Agent, the
Documentation Agent, the Issuing Bank or any Bank with respect to
any of the foregoing to the extent arising out of the gross
negligence or willful misconduct of the Administrative Agent, the
Documentation Agent, the Issuing Bank or such Bank or the
breach by the Administrative Agent, the Documentation Agent, the
Issuing Bank or such Bank of this Agreement or from the transfer
or disposition of any Note by any Bank. If any claim, demand,
action or cause of action is asserted against any indemnitee,
such indemnitee shall promptly notify Borrower, but the failure
to so promptly notify Borrower shall not affect Borrower's
obligations under this Section unless such failure materially
prejudices Borrower's right to participate in the contest of such
claim, demand, action or cause of action, as hereinafter
provided. If requested by Borrower in writing and so long as no
Default or Event of Default shall have occurred and be
continuing, such indemnitee shall in good faith contest the
validity, applicability and amount of such claim, demand, action
or cause of action, shall permit Borrower to participate in such
contest and shall cooperate with Borrower to the extent their
interests are aligned. Any indemnitee that proposes to settle
or compromise any claim or proceeding for which Borrower may
be liable for payment of indemnity hereunder shall give Borrower
written notice of the terms of such proposed settlement or
compromise reasonably in advance of settling or compromising such
claim or proceeding and shall obtain Borrower's written approval
thereof, which approval may be withheld in Borrower's sole
discretion. Any voluntary settlement by an indemnitee of such a
claim or proceeding without Borrower's written approval, shall
relieve Borrower of its obligation to indemnify that indemnitee
with respect to such claim or proceeding. In any legal action
involving more than one indemnitee, all indemnitees shall be
represented by a single legal counsel unless such legal counsel
determines that a defense or counterclaim is available to an
indemnitee that is not available to all indemnitees and that to
assert such a defense or counterclaim would create a conflict of
interest, or a potential conflict of interest, in which case such
indemnitee shall be entitled to separate legal counsel. Any
obligation or liability of Borrower to any indemnitee under this
Section shall survive the expiration or termination of this
Agreement and the repayment of all Loans and all other
Obligations owed to the Banks.
11.11 Nonliability of Banks. The relationship between
---------------------
Borrower and the Banks is, and shall at all times remain, solely
that of borrower and lenders, and the Banks, the Documentation
Agent and the Administrative Agent neither undertake nor assume
any responsibility or duty to Borrower to review, inspect,
supervise, pass judgment upon, or inform Borrower of any matter
in connection with any phase of Borrower's business, operations,
or condition, financial or otherwise. Borrower shall rely
entirely upon its own judgment with respect to such matters, and
any review, inspection, supervision, exercise of judgment, or
information supplied to Borrower by any Bank, the Documentation
Agent or the Administrative Agent in connection with any such
matter is for the protection of the Banks, the Documentation
Agent and the Administrative Agent, and neither Borrower nor any
third party is entitled to rely thereon.
11.12 Confidentiality. Each Bank agrees to use any
---------------
confidential information that it may receive, directly or
indirectly, from Borrower pursuant to this Agreement only for the
purposes of this Agreement, and hold such confidential
information in confidence, except for disclosure: (a) To
------
Affiliates of the Bank; (b) To other Banks; (c) To legal counsel,
accountants and (subject to reasonable prior notice to Borrower)
other professional advisors to that Bank; (d) To regulatory
officials having jurisdiction over that Bank; (e) As required by
Law or legal process or in connection with any legal proceeding
to which that Bank and Borrower are adverse parties; and (f) To
another financial institution in connection with a disposition or
proposed disposition to that financial institution of all or part
of that Bank's interests hereunder or a participation interest in
its Note, provided that such disclosure is made subject to an
appropriate confidentiality agreement on terms substantially
similar to this Section. For purposes of the foregoing,
"confidential information" shall mean any information respecting
Borrower or its Subsidiaries reasonably considered by Borrower to
be confidential, other than (i) information previously filed with
----------
any Governmental Agency and available to the public, (ii)
information previously published in any public medium from a
source other than, directly or indirectly, that Bank, and
(iii) information previously disclosed by Borrower to any Person
not associated with Borrower without a written confidentiality
agreement substantially similar to this Section. Nothing in this
Section shall be construed to create or give rise to any
fiduciary duty on the part of the Documentation Agent, the
Administrative Agent or the Banks to Borrower.
11.13 No Third Parties Benefited. This Agreement is made
--------------------------
for the purpose of defining and setting forth certain
obligations, rights and duties of Borrower, the Administrative
Agent, the Documentation Agent and the Banks in connection with
the Commitment, and is made for the sole benefit of Borrower, the
Administrative Agent, the Documentation Agent and the Banks, and
the Administrative Agent's, the Documentation Agent's and the
Banks' successors and assigns. Except as provided in
------
Sections 11.8 and 11.10, no other Person shall have any rights of
---- -----
any nature hereunder or by reason hereof.
11.14 Right of Setoff - Deposit Accounts. Upon the
----------------------------------
occurrence of an Event of Default and the acceleration of
maturity of the principal indebtedness under the Notes pursuant
to Section 9.2, Borrower hereby specifically authorizes each Bank
---
(subject to the approval of the Majority Banks) in which Borrower
or any of its Subsidiaries maintains a deposit account (whether a
general or special deposit account, other than trust accounts) or
a certificate of deposit to setoff any Obligations owed to the
Banks against such deposit account or certificate of deposit
without prior notice to Borrower or such Subsidiary (which notice
is hereby waived) whether or not such deposit account or
certificate of deposit has then matured. Nothing in this Section
shall limit or restrict the exercise by a Bank of any right to
setoff or banker's lien under applicable Law, subject to the
approval of the Majority Banks.
11.15 Further Assurances. Borrower shall, at its expense
------------------
and without expense to the Banks or the Administrative Agent, do,
execute, and deliver such further acts and documents as any Bank
or the Administrative Agent from time to time reasonably requires
for the assuring and confirming unto the Banks or the
Administrative Agent the rights hereby created or intended now or
hereafter so to be, or for carrying out the intention or
facilitating the performance of the terms of any Loan Document.
11.16 Integration. This Agreement, together with the
-----------
other Loan Documents, comprises the complete and integrated
agreement of the parties on the subject matter hereof and
supersedes all prior agreements, written or oral, on the subject
matter hereof except as expressly provided herein to the
contrary; provided that the foregoing is subject to Section 4.18
----
hereof. The Loan Documents were drafted with the joint
participation of Borrower and the Banks and shall be construed
neither against nor in favor of either, but rather in accordance
with the fair meaning thereof.
11.17 Governing Law. The Loan Documents shall be
-------------
governed by, and construed and enforced in accordance with, the
Laws of California.
11.18 Choice of Forum. Except as otherwise expressly
---------------
provided in any Loan Document, the parties hereto and thereto
agree and intend that the proper and exclusive forum for any
litigation of any disputes or controversies arising out of or
related to the Loan Documents shall be the Superior Court of the
State of California for the County of Los Angeles. Each Party to
any Loan Document hereby expressly waives any defense or
objection to jurisdiction or venue based on the doctrine of
forum non conveniens, and stipulates that the Superior Court of
- ----- --- ----------
the State of California for the County of Los Angeles shall have
in personam jurisdiction and venue over such Party for the
- -- --------
purpose of litigating any dispute or controversy arising out of
or related to the Loan Documents. In the event any party
commences or maintains any action or proceeding arising out of or
related to the Loan Documents in a forum other than the Superior
Court of the State of California for the County of Los Angeles,
any party shall be entitled to request the dismissal or stay of
such action or proceeding, and each party stipulates that such
action or proceeding shall be dismissed or stayed.
11.19 Severability of Provisions. Any provision in any
--------------------------
Loan Document that is held to be inoperative, unenforceable, or
invalid in any jurisdiction shall, as to that jurisdiction, be
inoperative, unenforceable, or invalid without affecting the
remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan
Documents are declared to be severable.
11.20 Headings. Article and section headings in this
--------
Agreement and the other Loan Documents are included for
convenience of reference only and are not part of this Agreement
or the other Loan Documents for any other purpose.
11.21 Time of the Essence. Time is of the essence of the
-------------------
Loan Documents.
11.22 Conflict in Loan Documents. To the extent there is
--------------------------
any actual irreconcilable conflict between the provisions of this
Agreement and any other Loan Document, the provisions of this
Agreement shall prevail.
11.23 Removal of a Bank. Borrower shall have the right
-----------------
to remove a Bank as a party to this Agreement in accordance with
this Section under the circumstances set forth in Sections 2.11,
----
3.8, 3.16 and 11.8(f); provided that no Default or Event of
- --- ---- ------- --------
Default then exists. If Borrower is so entitled to remove a Bank
pursuant to this Section either:
------
(a) Upon notice from Borrower, the Bank being
removed shall execute and deliver a Commitment Assignment
and Acceptance covering that Bank's Pro Rata Share of the
Commitment in favor of one or more Eligible Assignees
designated by Borrower (and acceptable to the
Administrative Agent, which acceptance shall not be
unreasonably delayed or withheld), subject to (i) payment
of a purchase price by such Eligible Assignee equal to all
principal and accrued interest, fees and other amounts
payable to such Bank under this Agreement through the date
of assignment and (ii) the written release of the Issuing
Bank and the Swing Line Bank of such Bank's obligations
under Sections 2.4(c), 2.5(b) and 2.10(d) or delivery by
------ ------ -------
such Eligible Assignee of such appropriate assurances and
indemnities (which may include letters of credit) as such
Bank may reasonably require with respect to its
participation interest in any Letters of Credit then
outstanding or any Swing Line Outstandings; or
(b) Borrower may reduce the Commitment pursuant to
Section 2.7 (and, for this purpose, the numerical
---
requirements of such Section shall not apply) by an amount
equal to that Bank's Pro Rata Share of the Commitment, pay
and provide to such Bank the amounts, assurances and
indemnities described in subclauses (i) and (ii) of
clause (a) above and release such Bank from its Pro Rata
Share of the Commitment.
11.24 Waiver of Right to Trial by Jury. EACH PARTY TO
--------------------------------
THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY
LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING,
AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH
PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.
11.25 Purported Oral Amendments. BORROWER EXPRESSLY
-------------------------
ACKNOWLEDGES THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
MAY ONLY BE AMENDED OR MODIFIED, OR THE PROVISIONS HEREOF OR
THEREOF WAIVED OR SUPPLEMENTED, BY AN INSTRUMENT IN WRITING THAT
COMPLIES WITH SECTION 11.2. BORROWER AGREES THAT IT WILL NOT
----
RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR
WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF THE ADMINISTRATIVE
AGENT, THE DOCUMENTATION AGENT OR ANY BANK THAT DOES NOT COMPLY
WITH SECTION TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER OR
SUPPLEMENT TO THE AGREEMENT OR THE OTHER LOAN DOCUMENTS.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the date first above
written.
THE VONS COMPANIES, INC.,
a Michigan corporation
By: /s/ PAMELA K. KNOUS
--------------------------------
Pamela K. Knous
Senior Vice President and Chief
Financial Officer
By: /s/ VIRGINIA L. MILLER
--------------------------------
Virginia L. Miller
Vice President and Treasurer
The Vons Companies, Inc.
618 Michillinda Avenue
Arcadia, California 91007
Attn: Chief Financial Officer
Telecopier: (818) 821-7912
Telephone: (818) 821-7436
with a copy to:
The Vons Companies, Inc.
618 Michillinda Avenue
Arcadia, California 91007
Attn: General Counsel
Telecopier: (818) 821-7901
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
as Documentation Agent
By: /s/ CHARLES D. GRABER
--------------------------------
Charles D. Graber
Vice President
Bank of America NT&SA
Agency Management Services, No. 5596
1455 Market Street, 13th Floor
San Francisco, California 94103
Telecopier: (415) 622-4894
Telephone: (415) 953-4624
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
as a Bank
By: /s/ RUTH Z. EDWARDS
--------------------------------
Ruth Z. Edwards
Vice President
Bank of America NT&SA
555 South Flower Street, 11th Floor
Los Angeles, California 90071
Attn: Ruth Z. Edwards
Telecopier: (213) 228-2756
Telephone: (213) 228-2678
A copy of any notice to Bank of
America NT&SA as a Bank shall also be
sent to Bank of America NT&SA as
Documentation Agent.
THE CHASE MANHATTAN BANK, N.A.,
as Administrative Agent
By /s/ ELLEN GERTZOG
--------------------------------
Ellen Gertzog
Vice President
The Chase Manhattan Bank, N.A.
4 Chase Metrotech Center, 13th Floor
Brooklyn, New York 11245
Attn: Peter Iovino
Telecopier: (718) 242-6909 or 6910
Telephone: (718) 242-7943
THE CHASE MANHATTAN BANK, N.A.,
as a Bank
By: /s/ ELLEN GERTZOG
--------------------------------
Ellen Gertzog
Vice President
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza, 5th Floor
New York, New York 10081
Attn: Ellen Gertzog
Telecopier: (212) 552-7075
Telephone: (212) 552-1721
THE BANK OF NOVA SCOTIA,
as a Bank
By /s/ M. VAN OTTERLOO
--------------------------------
M. Van Otterloo
Senior Relationship Manager
The Bank of Nova Scotia
101 California Street, 48th Floor
P.O. Box 3716
San Francisco, California 94119
Attn: M. Van Otterloo
Telecopier: (415) 397-0791
Telephone: (415) 986-1100
CITICORP USA, INC.,
as a Bank
By /s/ WILLIAM P. STENGEL
--------------------------------
William P. Stengel
Vice President
Citicorp USA, Inc.
399 Park Avenue, 12th Floor
New York, New York 10043
Attn: William P. Stengel
Telecopier: (212) 793-7585
Telephone: (212) 559-4534
NATIONSBANK OF TEXAS, N.A.,
as a Bank
By /s/ MICHELE M. SHAFROTH
--------------------------------
Michele M. Shafroth
Senior Vice President
NationsBank of Texas, N.A.
444 South Flower Street, Suite 1500
Los Angeles, California 90071
Attn: Michele M. Shafroth
Telecopier: (213) 624-5815
Telephone: (213) 236-4907
ABN AMRO BANK N.V., Los Angeles
International Branch,
as a Bank
By /s/ JOHN A. MILLER
--------------------------------
John A. Miller
Vice President
By /s/ ELLEN M. COLEMAN
--------------------------------
Ellen M. Coleman
Assistant Vice President
ABN AMRO Bank N.V.
Los Angeles International Branch
300 South Grand Avenue, Suite 1115
Los Angeles, California 90071
Attn: Ellen M. Coleman
Telecopier: (213) 687-2061
Telephone: (213) 687-2306
FIRST INTERSTATE BANK OF CALIFORNIA,
as a Bank
By /s/ WILLIAM J. BAIRD
--------------------------------
William J. Baird
Vice President
By /s/ JUDY MAAHS
--------------------------------
Judy Maahs
Assistant Vice President
First Interstate Bank of California
707 Wilshire Boulevard, W16-13
Los Angeles, California 90017
Attn: William J. Baird
Telecopier: (213) 614-2569
Telephone: (213) 614-5540
THE FIRST NATIONAL BANK OF CHICAGO,
as a Bank
By /s/ L. GENE BEUBE
--------------------------------
L. Gene Beube
Senior Vice President
The First National Bank of Chicago
One First National Plaza
Mail Suite 0634, 1-14
Chicago, Illinois 60670
Attn: L. Gene Beube
Telecopier: (312) 732-2117
Telephone: (312) 732-6836
SOCIETE GENERALE,
as a Bank
By /s/ MAUREEN KELLY
--------------------------------
Maureen Kelly
Vice President
Societe Generale
2029 Century Park East
Suite 2900
Los Angeles, California 90067
Attn: Doris Yun or Tu-Linh Wu
Telecopier: (310) 203-0539
Telephone: (310) 788-7116 or
(310) 788-7114
UNION BANK,
as a Bank
By /s/ ANN M. YASUDA
--------------------------------
Ann M. Yasuda
Vice President
By /s/ CARY MOORE, VP for
--------------------------------
Cecilia M. Valente
Vice President
Union Bank
445 South Figueroa Street, G16-030
Los Angeles, California 90071-1602
Attn: Ann M. Yasuda
Telecopier: (213) 236-7636
Telephone: (213) 236-6604
Union Bank
350 California, H-1112
San Francisco, CA 94104
Attn: Cecilia M. Valente
Telecopier: (415) 705-7092
Telephone: (415) 705-7042
BANK OF HAWAII,
as a Bank
By /s/ PETER S. HO
--------------------------------
Peter S. Ho
Vice-President
--------------------------------
[Printed Name and Title]
Bank of Hawaii
130 Merchant Street, 20th Flr.
Honolulu, Hawaii 96813
Attn: Peter S. Ho
Telecopier: (808) 537-8301
Telephone: (808) 537-8439
CHEMICAL BANK, as a Bank
By /s/ WILLIAM RINDFUSS
--------------------------------
William Rindfuss
Vice President
Chemical Bank
270 Park Avenue, 10th Floor
New York, New York 10017
Attn: William Rindfuss
Telecopier: (212) 270-1474
Telephone: (212) 270-4565
CREDIT LYONNAIS LOS ANGELES BRANCH,
as a Bank
By /s/ THIERRY VINCENT
--------------------------------
Thierry Vincent
Vice President
CREDIT LYONNAIS CAYMAN ISLAND BRANCH,
as a Bank
By /s/ THIERRY VINCENT
--------------------------------
Thierry Vincent
Authorized Signatory
Credit Lyonnais Los Angeles Branch
515 South Flower Street
Los Angeles, California 90071
Attn: Francois Coussot
Telecopier: (213) 623-3437
Telephone: (213) 362-5954
Credit Lyonnais Cayman Island Branch
c/o Credit Lyonnais Los Angeles Branch
515 South Flower Street
Los Angeles, California 90071
Attn: Francois Coussot
Telecopier: (213) 623-3437
Telephone: (213) 362-5954
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
Los Angeles Agency, as a Bank
By /s/ SHU TAMARU
--------------------------------
Shu Tamaru, Joint General Manager
--------------------------------
[Printed Name and Title]
The Industrial Bank of Japan, Ltd.,
Los Angeles Agency
350 South Grand Avenue, Suite 1500
Los Angeles, California 90071
Attn: Vicente L. Timiraos
Telecopier: (213) 488-9840
Telephone: (213) 893-6442
PNC BANK, NATIONAL ASSOCIATION,
as a Bank
By /s/ ANTHONY L. TRUNZO
--------------------------------
Anthony L. Trunzo
Vice President
PNC Bank, National Association
55 South Lake Avenue, Suite 650
Pasadena, California 91101
Attention: Anthony L. Trunzo
Telecopier: (818) 568-0653
Telephone: (818) 568-9423
THE TOKAI BANK, LTD.,
LOS ANGELES AGENCY,
as a Bank
By /s/ MASHIKO SAITO
--------------------------------
Mashiko Saito
Assistant General Manager
The Tokai Bank, Ltd.,
Los Angeles Agency
534 West 6th Street
Los Angeles, California 90014
Attn: Poebus Hon
Telecopier: (213) 892-2818
Telephone: (213) 892-2853
<PAGE>
<TABLE>
Schedule 1.1 to Revolving Loan Agreement
<CAPTION>
Bank Commitment Amount Pro Rata Share
- ---- ----------------- --------------
<S> <C> <C>
Bank of America National
Trust and Savings Association $75,000,000 12.00%
The Chase Manhattan Bank, N.A. $75,000,000 12.00%
The Bank of Nova Scotia $50,000,000 8.00%
Citicorp USA, Inc. $50,000,000 8.00%
NationsBank of Texas, N.A. $50,000,000 8.00%
ABN Amro Bank, N.V. $35,000,000 5.60%
First Interstate Bank of
California $35,000,000 5.60%
The First National Bank of
Chicago $35,000,000 5.60%
Societe Generale $35,000,000 5.60%
Union Bank $35,000,000 5.60%
Bank of Hawaii $25,000,000 4.00%
Chemical Bank $25,000,000 4.00%
Credit Lyonnais Los Angeles
Branch $25,000,000 4.00%
The Industrial Bank of Japan,
Ltd., Los Angeles Agency $25,000,000 4.00%
PNC Bank, National Association $25,000,000 4.00%
The Tokai Bank, Ltd.,
Los Angeles Agency $25,000,000 4.00%
Totals $625,000,000 100.00%
</TABLE>
<PAGE>
SCHEDULE 2.5
INITIAL LETTERS OF CREDIT
NONE
<PAGE>
<TABLE>
SCHEDULE 4.4
SUBSIDIARIES
<CAPTION>
Jurisdiction/ Shares Authorized/
Company Form of legal entity Status Outstanding Notes
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Miramar Associates California gen. part. Unrestricted Subsidiary None 3
Vons Food Services, California corp. Restricted Subsidiary 2,500/95 1,2
Inc. Significant Subsidiary
VAT Partners California gen. part. Unrestricted Subsidiary None 3
VAT Partners II California gen. part. Unrestricted Subsidiary None 3
- ------------------------
<FN>
1. All shares owned by The Vons Companies, Inc.
2. All shares are common stock unless otherwise noted.
3. The Vons Companies, Inc. interest totals 50%.
</TABLE>
SCHEDULE 4.4
Page 1 of 1
<PAGE>
SCHEDULE 4.7
EXISTING LIENS AND RIGHTS OF OTHERS
-----------------------------------
1. Vons Meat Service Center at 10150 Lower Azusa Road, El
Monte, California. This property is encumbered by a deed of
trust; Trustee - Ticor; Beneficiary - Massachusetts Mutual Life
Insurance Company; securing payment of note in the amount of
$9,900,000. Note matures September 30, 2003.
2. Group of 51 Vons stores in California. This property
is encumbered by a deed of trust; Trustee - Ticor; Beneficiary -
Metropolitan Life Insurance Company; securing payment of note in
he amount of $125,000,000. Note matures July, 1997.
3. Vons Store #152, Pasadena, California - 155 West
California Boulevard. This property is encumbered by a deed of
trust dated March 26, 1979; Trustor - Borrower; Trustee - Ticor;
Beneficiary - Southwestern Life Insurance Co.; securing payment
of note in the amount of $2,100,000. Note matures April 1, 2004.
4. Vons Store #151, Bakersfield, California - 3041 Wilson
Road. This property is encumbered by a deed of trust dated
March 26, 1979; Trustor - Borrower; Trustee - Ticor;
Beneficiary-Southwestern Life Insurance Company; securing payment
of note in the amount of $1,520,000. Note matures April 1, 2004.
5. Vons Store #121, Vista, California - 940 South Santa Fe
Avenue. This property is encumbered by a deed of trust dated
January 30, 1978; Trustor - Borrower; Trustee - Ticor;
Beneficiary - Southwestern Life Insurance Co.; securing payment
of note in the amount of $1,250,000. Note matures February 1,
2003.
6. Vons Store #356, National City, California - 1220 Plaza
Boulevard. This property is encumbered by a mortgage.
Beneficiary - Calpers; securing payment of a note in the amount
of $2,765,000. Note matures June 29, 2009.
7. Williams Bros. #316, San Luis Obispo, California - 3550
South Broad Street. This property is encumbered by a deed of
trust; Beneficiary - Young Bros. Investment Company, Inc.;
securing payment of a note in the amount of $1,650,000. Note
matures on May 7, 1997.
8. Williams Bros. #318, Lompoc, California - 1309 North H
Street. This property is encumbered by a deed of trust.
Beneficiary - Met-Mor Financial Inc.; securing payment of a note
in the amount of $2,000,000. Note matures December 1, 2000.
9. Borrower and VAT Partners have acquired approximately
60 leases which had been owned by Collins & Aikman, Inc. and
operated as Builders Emporium and Ole's. In connection with this
transaction, Borrower and VAT Partners have entered into
agreements with various parties pursuant to which those parties
shall assume certain of the leases.
Schedule 4.7
Page 1 of 2
10. Miramar Associates owns a warehouse and strip shopping
center in San Diego, California which are encumbered by deeds of
trust in favor of Metropolitan Life (totaling $15,100,000) and
Western Financial (totaling $1,260,000), respectively.
11. In connection with the closure of the EXPO stores in
January 1995, preliminary agreements to sell four of the stores
(#454 Huntington Park, #452 Cudahy, #605 El Monte and #451
Montebello) are under negotiation.
Schedule 4.7
Page 2 of 2
<PAGE>
<TABLE>
SCHEDULE 4.9
EXISTING INDEBTEDNESS AND GUARANTY OBLIGATIONS
(000'S)
<CAPTION>
Total Outstanding
Description ----------------- of Property
Description on Instrument Due Date Rate Amount As of Encumbered
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Allied Senior Subordinated
Debentures (Face Amount) May 15, 1998 6.625% 79,150 * Feb. 17, 1995 None
The Vons Companies, Inc.
Senior Subordinated
Debentures October 1, 1999 8.375% 100,000 Feb. 17, 1995 None
The Vons Companies, Inc.
Senior Subordinated
Notes April 1, 2002 9.625% 150,000 Feb. 17, 1995 None
Uncommitted Short Term
Facilities (Face Amount) 1 Year or less Various 135,000 Feb. 16, 1995 None
(excluding letters of
credit)
Capitalized Leases over $5,000:
DFT Properties, Inc. Jan 31, 2019 N/A 4,563 Jan. 1, 1995 Vons #505
(Bakersfield)
AMI Properties, Inc. Jan 31, 2018 N/A 5,511 Jan. 1, 1995 Vons #506
(Fresno)
Birtcher Trachman
Properties, LTD. Sept. 30, 2011 N/A 4,959 Jan. 1, 1995 Vons #600
(Fontana)
Alexander Haagen
Properties Operating
Partners LP Dec. 31, 2018 N/A 5,593 Jan. 1, 1995 Vons #603
(Pomona)
NationsBanc Leasing July 15, 1997 to N/A 6,824 Jan. 1, 1995 Tractors/
April 22, 1998 Trailers
<FN>
* The Company has repurchased and cancelled debentures totaling $45,850.
</TABLE>
Schedule 4.9
Page 1 of 4
<PAGE>
<TABLE>
<CAPTION>
Total Outstanding
----------------- Description of
Description of Property
Instrument Due Date Rate Amount As of Encumbered
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Letters of Credit:
Board of Trustees, Central Dec. 31, 1995 N/A 2,300 Feb. 17, 1995 None
States Southeast &
Southwest Areas Pension Fund
(Bank of America L/C #216099)
Employers Reinsurance July 1, 1995 N/A 200 Feb. 17, 1995 None
Corporation
(Bank of America L/C #216095)
City of Bakersfield May 2, 1995 N/A 147 Feb. 17, 1995 None
(Bank of America L/C #219949)
City of Carpinteria Sept 23, 1995 N/A 2 Feb. 17, 1995 None
(Bank of America L/C #216098)
City of Fresno Jan. 10, 1996 N/A 105 Feb. 17, 1995 None
(Bank of America L/C #218966)
State of California May 30, 1995 N/A 70,603 Feb. 17, 1995 None
(Bank of America L/C #216091)
State of Nevada Jan. 1, 1996 N/A 460 Feb. 17, 1995 None
(Bank of America L/C #216094)
</TABLE>
Schedule 4.9
Page 2 of 4
<PAGE>
<TABLE>
<CAPTION>
Total Outstanding
----------------- Description of
Description of Property
Instrument Due Date Rate Amount As of Encumbered
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Mortgage Financing:
Metropolitan Life July 1, 1997 9.250% 114,951 Jan. 1, 1995 Group of
Insurance Mortgage 51 Stores
Financing
Massachusetts Mutual Sept 30, 2003 8.500% 5,875 Jan. 1, 1995 Vons Meat
Life Insurance Mortgage Processing
Financing Facility
Southwestern Life Feb 1, 2003 8.375% 695 Jan. 1, 1995 Vons #121
Insurance Company (Vista)
Mortgage Financing
Southwestern Life April 1, 2004 8.500% 939 Jan. 1, 1995 Vons #151
Insurance Company
(Bakersfield)
Mortgage Financing
Southwestern Life April 1, 2004 8.500% 1,297 Jan. 1, 1995 Vons #152
Insurance Company (Pasadena)
Mortgage Financing
Calpers June 29, 2009 11.500%*** 2,375 Jan. 1, 1995 Vons #356
(National
City)
Young Bros. May 7, 1997 6.000% 906 Jan. 1, 1995 Williams
Investment Bros. #316
Company, Inc. (San Luis
Obispo)
Met-Mor Financial Dec. 30, 2000 12.250% 1,970 Jan. 1, 1995 Williams
Inc. Bros. #318
(Lompoc)
<FN>
*** 11.5% + Additional Income Interest based upon Gross Income performance
</TABLE>
Schedule 4.9
Page 3 of 4
<PAGE>
<TABLE>
<CAPTION>
Total Outstanding
----------------- Description of
Description of Property
Instrument Due Date Rate Amount As of Encumbered
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Guaranty Obligations:
<FN>
Meadowdale - As successor to Allied Supermarkets, Inc., Borrower has various guaranty
obligations arising from obligations of Meadowdale Foods, Inc. and M-Foods, Inc. including
certain obligations of Allied Supermarkets, Inc. assumed by Meadowdale Foods, Inc. on
7/22/87. These obligations include, but are not limited to, the letters of credit #216099
and #216095 listed above.
Miramar Associates - Mortgage obligations of partnership. Deeds of trust total
$15,360,000, with outstandings as of December 31, 1994 totaling $15,157,131.
Vons Food Services, Inc., - Subsidiary Guaranty executed on behalf of the Banks pursuant
to the Agreement.
</TABLE>
Schedule 4.9
Page 4 of 4
<PAGE>
SCHEDULE 4.15
PENSION/RETIREMENT PLANS
------------------------
Defined Benefit Plans:
Status:
- - The Vons Companies, Inc. Pension Plan Open
Other Unfunded Pension Plans:
NONE
Multiemployer Pension Plans: (to which contributions are
currently being made)
- - Bakery and Confectionery Union and Industry Inter-
national Health Benefits and Pension Funds (Vons) Open
- - California Butchers Pension Trust Fund and
Northern California Butchers Unions and Employees
Health Trust Fund and Vacation Plan (Vons) Open
- - Central Pension Fund of the International
Union of Operating Engineers (Vons and Jerseymaid) Open
- - I.A.M. National Pension Fund (Vons) Open
- - Intermountain Retail Food Industry Pension
Trust (Vons) Open
- - Northern California Retail Clerks Union (Vons) Open
- - Retail Food Employers and Retail Clerks Union
Local 711 Pension and Benefit Fund (Vons) Open
- - SEIU National Industry Pension Fund Open
- - Southern California Retail Clerks Union and Drug
Employer Trust Fund (Vons) Open
- - United Food and Commercial Workers Unions and Food
Employers Joint Trust Funds (Vons) (Formerly,
Southern California Retail Clerks and Food Employers
Pension Trust Fund) Open
- - Western Conference of Teamsters Pension Trust
(Vons and Jerseymaid) Open
Schedule 4.15
Page 1 of 1
<PAGE>
SCHEDULE 4.20
ENVIRONMENTAL MATTERS
NONE
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 6.4
INVESTMENTS
Amount
as of
Obligor Type of Instrument Feb. 117, 1995 Maturity Date
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Joie G. Scolari Promissory Note $76,508 October 1995
Henderson Associates Promissory Note $96,146 March 1995
See Schedule 4.4 Subsidiaries
Guarantees and Guaranty Various Various Various
Obligations on Schedule 4.9
Advanced Promotion Common Stock 716,332 shs.
Technologies, Inc.
Advanced Promotion Convertible Debentures $200,000 1999
Technologies, Inc.
Advanced Promotion Warrants to purchase 21,000 shs. 1999
Technologies, Inc. Common Stock
SHL Systemhouse Inc. Warrants to purchase 200,000 shs. June 1997
Common Stock
Certified Grocers of Class A Stock 100 shs.
California, Ltd. Class B Stock 9,066 shs.
Subordinated Patronage $2,571 December 2000
Dividend Certificate
VAT Partners Partnership Contribution $5,134,300
VAT Partners II Partnership Contribution $9,401,700
Schedule 6.4
Page 1 of 1
<PAGE>
[EXHIBIT A]
COMMITMENT ASSIGNMENT AND ACCEPTANCE AGREEMENT
----------------------------------------------
THIS COMMITMENT ASSIGNMENT AND ACCEPTANCE AGREEMENT
("Agreement") dated as of , 19 is made with
------------------ ---
reference to that certain Revolving Loan Agreement dated as of
February 17, 1995, among The Vons Companies, Inc. ("Borrower"),
the Banks therein named and Bank of America National Trust and
Savings Association and The Chase Manhattan Bank, N.A., as
Managing Agents for themselves and for the Banks (as amended as
of the date hereof, the "Loan Agreement") and is entered into
between the "Assignor" described below, in its capacity as a Bank
under the Loan Agreement, and the "Assignee" described below.
Assignor and Assignee hereby represent, warrant and agree as
follows:
1. Definitions. Capitalized terms defined in the
-----------
Loan Agreement are used herein with the meanings set forth for
such terms in the Loan Agreement. As used in this Agreement, the
following capitalized terms shall have the meanings set forth
below:
"Assignee" means .
-------- ----------------------------------
"Assigned Pro-Rata Share" means % of the
----------------------- -----------
Commitment of the Banks under the Loan Agreement, being equal to
$ .
--------------
"Assignor" means .
-------- ------------------------------
"Effective Date" means , the effective
-------------- ------------------
date of this Agreement determined in accordance with Section
11.8 of the Loan Agreement.
- ----
2. Representations and Warranties of the Assignor.
----------------------------------------------
The Assignor represents and warrants as follows:
a. As of the date hereof, the Pro-Rata Share of
the Assignor is % of the Commitment (without giving effect
-----
to assignments thereof which have not yet become effective). The
Assignor is the legal and beneficial owner of the Assigned
Pro-Rata Share and the Assigned Pro-Rata Share is free and clear
of any adverse claim.
b. The outstanding principal balance of Advances
made by Assignor is $ .
--------------
c. The Assignor has full power and authority,
and has taken all action necessary to execute and deliver this
Agreement and any and all other documents required or permitted
to be executed or delivered by it in connection with this
Agreement and to fulfill its obligations under, and to consummate
the transactions contemplated by, this Agreement, and no
governmental authorizations or other authorizations are required
in connection therewith;
d. This Agreement constitutes the legal, valid
and binding obligation of the Assignor. Assignor makes no
representation or warranty and assumes no responsibility with
respect to the financial condition of Borrower or the performance
by Borrower of the Obligations, and assumes no responsibility
with respect to any statements, warranties or representations
made or in connection with the Loan Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or
value of the Loan Agreement or any Loan Document other than as
expressly set forth above.
3. Representations and Warranties of the Assignee.
----------------------------------------------
The Assignee hereby represents and warrants to the Assignor as
follows:
(a) The Assignee has full power and authority, and
has taken all action necessary to execute and deliver this
Agreement, and any and all other documents required or permitted
to be executed or delivered by it in connection with this
Agreement and to fulfill its obligations under, and to consummate
the transactions contemplated by, this Agreement, and no
governmental authorizations or other authorizations are required
in connection therewith;
(b) This Agreement constitutes the legal, valid and
binding obligation of the Assignee;
(c) The Assignee has independently and without
reliance upon the Assignor and based on such information as the
Assignee has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Assignee will,
independently and without reliance upon the Administrative Agent,
the Documentation Agent or any Bank, and based upon 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 Agreement;
(d) The Assignee is an "Eligible Assignee" within the
meaning of the Loan Agreement;
(e) The Assignee has received a copy of the Loan
Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 7.1 of the Loan
---
Agreement and;
(f) If Assignee is organized under the Laws of a
jurisdiction outside the United States of America, attached
hereto are the forms prescribed by the Code certifying Assignee's
exemption from United States withholding taxes with respect to
all payments to be made to Assignee under the Loan Agreement.
4. Assignment. On the terms set forth herein,
----------
Assignor, as of Effective Date, hereby irrevocably sells, assigns
and transfers to the Assignee all of the rights and obligations
of the Assignor under the Loan Agreement, the other Loan
Documents and Assignor's Note, in each case to the extent of the
Assigned Pro-Rata Share, and the Assignee irrevocably accepts
such assignment of rights and assumes such obligations from the
Assignor on such terms and as of the Effective Date. As of the
Effective Date, Assignee shall have the rights and obligations of
a "Bank" under the Loan Documents, except to the extent of any
arrangements with respect to payments referred to in Section 5
-
hereof. Assignee hereby appoints and authorizes Administrative
Agent to exercise such powers under the Loan Agreement as are
delegate to the Administrative Agent by Article 10 of the Loan
--
Agreement.
5. Payment. On the Effective Date, Assignee shall
-------
pay to the Assignor, in immediately available funds, an amount
equal to the purchase price, as agreed between the Assignor and
the Assignee, of the Assigned Pro-Rata Share. The Assignor and
the Assignee have entered into a letter agreement, of even date
herewith, which sets forth their agreement with respect to the
amount of interest, fees, and other payments with respect to the
Assigned Pro-Rata Share which are to be retained by the Assignor.
The Assignor and the Assignee hereby agree that if
either receives any payment of interest, principal, fees or any
other amount under the Loan Agreement, their respective Notes and
other Loan Documents which is for the account of the other, it
shall hold the same in trust for such party to the extent of such
party's interest therein and shall promptly pay the same to such
party.
6. Principal, Interest, Fees, etc. Any principal
------------------------------
that would be payable and any interest, fees and other amounts
that would accrue from and after the Effective Date to or for the
account of the Assignor pursuant to the Loan Agreement and the
Notes shall be payable to or for the account of the Assignor and
the Assignee, in accordance with their respective interests as
adjusted pursuant to this Agreement.
7. Notes. The Assignor and the Assignee shall make
-----
appropriate arrangements with the Borrower concurrently with the
execution and delivery hereof so that a replacement Note is
issued to the Assignor and a new Note is issued to the Assignee,
in each case in principal amounts reflecting their Commitment or
their outstanding Advances (as adjusted pursuant to this
Agreement).
8. Further Assurances. Concurrently with the
------------------
execution of this Agreement, Assignor shall execute two
counterpart original Requests for Registration, in the form of
Exhibit A to this Agreement, to be forwarded to the
Administrative Agent. The Assignor and the Assignee further
agree to execute and deliver such other instruments, and take
such other action, as either party may reasonably request in
connection with the transactions contemplated by this Agreement,
and Assignor specifically agrees to cause the delivery of (i) two
original counterparts of this Agreement and (ii) the Requests for
Registration, to Administrative Agent for the purpose of
registration of Assignee as a "Bank" pursuant to Section 11.8 of
----
the Loan Agreement.
9. Governing Law. This Agreement shall be deemed to
-------------
be a contractual obligation under, and shall be governed by and
construed and interpreted in accordance with, the laws of the
State of California. For any dispute arising in connection with
this Agreement, the Assignee hereby irrevocably submits to the
jurisdiction of the courts of the State of California.
10. Notices. All communications among the parties or
-------
notices in connection herewith shall be in writing, hand
delivered or sent by registered airmail, postage prepaid, or by
telegram or cable, addressed to the appropriate party at its
address set forth on the signature pages hereof. All such
communications and notices shall be effective upon receipt.
11. Binding Effect. This Agreement shall be binding
--------------
upon and inure to the benefit of the parties and their respective
successors and assigns; provided, however, that Assignee shall
not assign its rights or obligations without the prior written
consent of the Assignor and any purported assignment, absent such
consent, shall be void.
12. Interpretation. The headings of the various
--------------
sections hereof are for convenience of reference only and shall
not affect the meaning or construction of any provision hereof.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed and delivered by their respective
officials, officers or agents thereunto duly authorized as of the
date first above written.
"Assignor"
---------------------------------
By:
------------------------------
Title:
---------------------------
Address:
-------------------------
-------------------------
-------------------------
Attn:
-------------------
-------------------
Telephone:
---------------
Telecopier:
-------------
"Assignee"
---------------------------------
By:
------------------------------
Title:
---------------------------
Address:
-------------------------
-------------------------
-------------------------
Attn:
-------------------
-------------------
Telephone:
--------------
Telecopier:
--------------
<PAGE>
[Exhibit A to Commitment Assignment and Acceptance Agreement]
REQUEST FOR REGISTRATION
------------------------
TO: THE CHASE MANHATTAN BANK, N.A., as Administrative Agent, and
THE VONS COMPANIES, INC.
THIS REQUEST FOR REGISTRATION OF ASSIGNEE is made as
of the date of the enclosed Commitment Assignment and Acceptance
Agreement with reference to that certain Revolving Loan
Agreement, dated as of February 17, 1995 among The Vons
Companies, Inc., the Banks therein named and Bank of America
National Trust and Savings Association and The Chase Manhattan
Bank, N.A., as Managing Agents for themselves and for the Banks
(as amended as of the date hereof, the "Loan Agreement").
Assignor and Assignee hereby request that
Administrative Agent register Assignee as a Bank pursuant to
Section 11.8 of the Loan Agreement effective as of the
----
Effective Date described in the enclosed Commitment Assignment
and Acceptance and, in connection with this request certify to
Administrative Agent that:
A. Assignee is an "Eligible Assignee" within the
meaning of that term set forth in the Loan Agreement; and
B. Schedule A to the enclosed Commitment Assignment
and Acceptance Agreement sets forth the correct Commitment and
the Assigned Pro-Rata Share of the Assignee.
Enclosed with this Request are:
(i) two counterpart originals of the Commitment
Assignment and Acceptance;
(ii) the original Note of Borrower in favor of
Assignor in the principal amount of $ ;
--------------
and
(iii) Assignee's check payable to Administrative
Agent for the $3000 recordation fee required by
Section 11.8(d) of the Loan Agreement.
-------
Assignor and Assignee hereby jointly request that the
Administrative Agent cause Borrower to issue replacement Notes,
dated as of the Closing Date, pursuant to Section 11.8 of the
----
Loan Agreement in favor of Assignor in the principal amount of
the remainder of its Pro-Rata Share of the Commitment and in
favor of the Assignee in the amount of the Assigned Pro-Rata
Share.
IN WITNESS WHEREOF, Assignor and Assignee have executed
this Request for Registration by their duly authorized officers
as of this day of , 19 .
--- ------------- --
"Assignor"
----------------------------------
By:
-------------------------------
(Printed/Typed Name of Officer)
"Assignee"
----------------------------------
By:
-------------------------------
(Printed/Typed Name of Officer)
<PAGE>
CONSENT OF ADMINISTRATIVE AGENT AND BORROWER
--------------------------------------------
TO: The Assignor and Assignee referred to in the above Request
for Registration
When countersigned by both Borrower and Administrative
Agent below, this document shall certify that:
1. If the consent of Borrower is required to such
assignment, Borrower has consented, pursuant to the terms of the
Loan Documents, to the assignment by Assignor to Assignee of the
Assigned Pro-Rata Share.
2. Administrative Agent has registered Assignee as a Bank
under the Loan Agreement, effective as of the Effective Date
described above, with a Pro-Rata Share of the Commitment
corresponding to the Assigned Pro-Rata Share and has adjusted the
registered Pro-Rata Share of the Commitment of Assignor to
reflect the assignment of the Assigned Pro-Rata Share.
Approved:
THE VONS COMPANIES, INC. THE CHASE MANHATTAN
BANK, N.A., as
Administrative Agent
By: By:
------------------------- -------------------------
By: By:
------------------------- -------------------------
<PAGE>
Exhibit B
COMPLIANCE CERTIFICATE
----------------------
TO: THE CHASE MANHATTAN BANK, N.A., AS ADMINISTRATIVE AGENT,
AND TO THE BANKS
Reference is made to the Revolving Loan Agreement
dated as of February 17, 1995, among THE VONS COMPANIES, INC., as
Borrower, the Banks therein named and BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION and THE CHASE MANHATTAN BANK, N.A.,
as Managing Agents (the "Loan Agreement"). Terms defined in the
Loan Agreement and not otherwise defined in this Compliance
Certificate (this "Certificate") are used in this Certificate as
defined in the Loan Agreement. This Certificate is delivered in
accordance with Section 7.2 of the Loan Agreement and relates
---
to the financial statements of Borrower and its Subsidiaries for
the Fiscal ended , 19 (the
-------------- ------------ --
"Financial Statements"), which are delivered concurrently
herewith.
I, , hereby certify that I am the
--------------------
and a Senior Officer of Borrower and that:
- ------------------
1. Interest Coverage Ratio. The Interest Coverage
-----------------------
Ratio, as used in the determination of the Applicable Pricing
Level, as of the day of the Fiscal [Quarter] [Year] ended
, 19 " is as set forth in the "Computation of
- -------------- --
Interest Coverage Ratio for the Fiscal [Quarter] [Year] ended
, 19 " attached hereto and incorporated herein by
- -------------- --
this reference.
2. Financial Covenants Computations. Borrower and
--------------------------------
its Subsidiaries are in compliance with their Obligations to the
Banks pursuant to Sections 6.13 through 6.16 of the Loan
---- ----
Agreement as set forth in the "Computation of the Loan Agreement
Covenants for Fiscal [Quarter] [Year] ended , 19 "
------------- --
attached hereto and incorporated herein by this reference.
3. Review of Activities; Defaults. A review of the
------------------------------
activities of Borrower and its Subsidiaries during the fiscal
period covered by the Financial Statements has been made under my
supervision with a view to determining whether, during such
fiscal period, Borrower and its Subsidiaries performed and
observed all of their respective Obligations under the Loan
Documents. Except with respect to the Defaults, if any,
specified and described, as to their nature and status below, to
the best of my knowledge, during the fiscal period covered by the
Financial Statements, Borrower and its Subsidiaries performed and
observed each covenant and condition applicable to them:
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
4. Material Adverse Effect. Except with respect to
-----------------------
the event(s) or circumstance(s) constituting a Material Adverse
Effect, if any, specified and explained in reasonable detail as
to their nature and status below, to the best of my knowledge, no
event or circumstance constituting a Material Adverse Effect has
occurred since the date of the most recent Compliance Certificate
previously delivered under Section 7.2 of the Loan Agreement:
---
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
IN WITNESS WHEREOF, I have signed this Certificate on
behalf of Borrower this day of , 19 .
---- --------------- ---
THE VONS COMPANIES, INC.
By:
--------------------------
Title:
-----------------------
<PAGE>
COMPUTATION OF INTEREST COVERAGE RATIO
--------------------------------------
FOR FISCAL [YEAR] [QUARTER] ENDED 19
-------------------------------------------------
INTEREST COVERAGE RATIO IS: : 1
----
Interest Coverage Ratio is calculated as follows:
</TABLE>
<TABLE>
<CAPTION>
Previous
Latest Three Total of
Fiscal Fiscal Four Latest
Quarter Quarters Quarters
------- ------- -------- ------- -----------
<S> <C> <C> <C> <C> <C>
ADJUSTED EBITDA:
Consolidated Income
Before
Extraordinary Items
plus Interest
- ----
Expense, net
plus Provision for
- ----
Income Taxes
plus Depreciation
- ----
and amortization of
property and
capital leases
plus Amortization
- ----
of excess cost over
net assets acquired
and other assets
plus charges
- ----
against income for
LIFO provision
plus Defined Non-
- ----
Recurring charges
minus credits to
- -----
income for LIFO
provision
minus Income of any
- -----
Subsidiary which
cannot make
Distributions to
Borrower
Total $ $ $ $ $
------- ------- -------- ------- -----------
divided by
INTEREST EXPENSE, NET
</TABLE>
<PAGE>
COMPUTATION OF LOAN AGREEMENT COVENANTS
---------------------------------------
FOR FISCAL [YEAR][QUARTER] ENDED 19
------------------------------------------------
<TABLE>
<CAPTION>
6.13 LEVERAGE RATIO
- -------------------
<S> <C>
MAXIMUM LEVERAGE RATIO: : 1
-----
LEVERAGE RATIO IS: : 1
-----
Calculated as follows:
CAPITAL INDEBTEDNESS: $
------------------
Current Maturities
Subordinated Debt
Senior Debt
Capital Leases
Letters of Credit
Swaps, Net Obligations
divided by
CAPITAL INDEBTEDNESS
plus SHAREHOLDERS' EQUITY $
- ---- ------------------
6.14 MINIMUM SHAREHOLDERS' EQUITY
- ---------------------------------
MINIMUM SHAREHOLDERS' EQUITY: $
------------------
Minimum Shareholders' Equity calculated as follows:
$405,000,000
plus
- ----
75% of Consolidated Net Income for each
Fiscal Quarter ending after October 9, 1994
(without reduction for any deficit Consolidated
Net Income during any Fiscal Quarter)
$
-----------------------
MINIMUM SHAREHOLDERS' EQUITY: $
--------------
SHAREHOLDERS' EQUITY IS: $
--------------
6.15 FIXED CHARGE COVERAGE RATIO
- --------------------------------
<S> <C>
MINIMUM FIXED CHARGE COVERAGE 1.85 : 1
FIXED CHARGE COVERAGE RATIO IS: : 1
-----
</TABLE>
Calculated as follows:
<TABLE>
<CAPTION>
Previous
Latest Three Total of
Fiscal Fiscal Four Latest
Quarter Quarters Quarters
------- ------- -------- ------- -----------
<S> <C> <C> <C> <C> <C>
ADJUSTED EBIDTA:
Consolidated Income
Before Extraordinary
Items
plus Interest
- ----
Charges, net
plus Provision for
- ----
Income Taxes
plus Depreciation and
- ----
Amortization of property
and capital leases
plus Amortization of
- ----
excess cost over net
assets acquired and other
assets
plus Charges
- ----
against income for
Income for LIFO
plus Defined Non-
- ----
Recurring Charges
minus Credits to Income
- -----
for LIFO provision
minus Income of any
- -----
Subsidiary which
cannot make
Distributions to
Borrower
Total Adjusted $ $ $ $ $
------- ------- -------- ------- -----------
EBITDA
Plus Rental Expense
Total $ $ $ $ $
------- ------- -------- ------- -----------
divided by
- ----------
CASH FIXED CHARGES
Previous
Latest Three Total of
Fiscal Fiscal Four Latest
Quarter Quarters Quarters
------- ------- -------- ------- -----------
Cash Fixed Charges:
Interest Expense-
Net
plus Rental Expense
- ----
plus Distributions
- ----
minus Amortization
- -----
of debt discount
and deferred
financing charges
minus other non-
- -----
cash fixed charges
Total Cash $ $ $ $ $
------- ------- -------- ------- -----------
Fixed Charges
<CAPTION>
6.16 CAPITAL EXPENDITURES
- -------------------------
<S> <C>
PERMITTED CAPITAL EXPENDITURES: $
----------------
CAPITAL EXPENDITURES ARE: $
----------------
Permitted Capital Expenditures
are calculated as follows:
Maximum Capital Expenditure
Amount (net of carryover) $300,000,000
Plus Carry over from immediately
----
preceding Fiscal Year $
----------------
Total $
----------------
<FN>
NOTE: The pages appended, if any, constitute a further
explanation of the manner in which the foregoing
computations relate to the Financial Statements to the
extent not readily apparent. (Check if pages are
appended) _____.
</TABLE>
<PAGE>
EXHIBIT C
NOTE
----
$[Pro-Rata share of $625,000,000] , 19
---------- --
Los Angeles, California
FOR VALUE RECEIVED, the undersigned promises to pay to the
order of the "Bank"), the
------------------------------
amount of DOLLARS
-------------------------------
($ ), or such lesser aggregate amount of Advances as
--------------
may be made by the Bank in accordance with its Pro Rata Share of
the Commitment under the Loan Agreement hereinafter described,
payable as hereinafter set forth. The undersigned promises to
pay interest on the principal amount hereof remaining unpaid from
time to time from the date hereof until the date of payment in
full, payable as hereinafter set forth.
Reference is made to the Revolving Loan Agreement dated as
of February 17, 1995, among the undersigned, as Borrower, the
Banks that are parties thereto, and Bank of America National
Trust and Savings Association and The Chase Manhattan Bank, N.A.,
as Managing Agents (the "Loan Agreement"). Terms defined in the
Loan Agreement and not otherwise defined herein are used herein
with the meanings defined for those terms in the Loan Agreement.
Any holder hereof is entitled to all of the rights, benefits and
privileges provided for in the Loan Agreement as originally
executed or as it may from time to time be supplemented, modified
or amended. The Loan Agreement, among other things, contains
provisions for reduction of the Commitment and for acceleration
of the maturity hereof upon the happening of certain stated
events upon the terms and conditions therein specified.
The principal indebtedness evidenced by this Note shall be
payable as provided in the Loan Agreement and in any event on the
Maturity Date.
Interest shall be payable on the outstanding daily unpaid
principal amount of each Loan from the date thereof until payment
in full and shall accrue and be payable at the rates set forth in
the Loan Agreement both before and after default and before and
after maturity and judgment, with interest on overdue interest to
bear interest at the Default Rate to the fullest extent permitted
by applicable Law.
The amount of each payment hereunder shall be made to the
Administrative Agent at the Administrative Agent's Office, for
the account of the Bank, in lawful money of the United States of
America and in immediately available funds not later than
10:00 a.m., Los Angeles time, on the day of payment (which must
be a Banking Day). If Borrower instructs the Administrative
Agent to debit the Designated Deposit Account for the amount of
any such payment on or before 10:00 a.m., Los Angeles time, on a
Banking Day, payment of such amount shall be deemed received
before 10:00 a.m. on such Banking Day; provided that the
--------
Designated Deposit Account has a credit balance in collected
funds at least equal to the amount of such payment prior to the
close of business for the Administrative Agent on such Banking
Day. All such payments received after 10:00 a.m., Los Angeles
time, on any Banking Day, shall be deemed received on the next
succeeding Banking Day. The amount of all payments received by
the Administrative Agent for the account of the Bank shall be
promptly paid by the Administrative Agent to the Bank in
immediately available funds. This Bank shall use its best
efforts to keep a record of Advances made by it and payments of
principal with respect to this Note, and such record shall be
presumptive evidence of the principal amount owing under this
Note.
The undersigned hereby promises to pay all costs and
expenses of any holder hereof in collecting the undersigned's
obligations hereunder or in enforcing any of holder's rights
hereunder, including attorneys' fees and disbursements, whether
or not an action is filed in connection therewith.
The undersigned hereby waives presentment, demand for
payment, dishonor, notice of dishonor, protest, notice of protest
and any other notice or formality to the fullest extent permitted
by applicable Laws.
This Note shall be delivered to and accepted by the Bank,
or by the Administrative Agent on its behalf, in the State of
California, and shall be governed by, and construed and enforced
in accordance with, the Laws thereof.
THE VONS COMPANIES, INC.,
a Michigan corporation
By:
----------------------------------
Its:
---------------------------------
By:
----------------------------------
Its:
---------------------------------
<PAGE>
<TABLE>
ADVANCES AND PAYMENTS OF PRINCIPAL
(Alternate Base Rate Loans)
- ---------------------------------------------------------------
<CAPTION>
Amount of Unpaid
Amount of Interest Principal Principal Notation
Date Advance Period Paid Balance Made by
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
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- ---------------------------------------------------------------
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- ---------------------------------------------------------------
- ---------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
ADVANCES AND PAYMENTS OF PRINCIPAL
(Eurodollar Rate Loans)
- ---------------------------------------------------------------
<CAPTION>
Amount of Unpaid
Amount of Interest Principal Principal Notation
Date Advance Period Paid Balance Made by
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
- ---------------------------------------------------------------
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- ---------------------------------------------------------------
</TABLE>
EXHIBIT D
<PAGE>
[This page appears on The Vons Companies, Inc, letterhead]
Terrence J. Wallock
Executive Vice President
General Counsel
and Secretary
February 17, 1995
The Banks under the Agreement, as defined below,
c/o Bank of America National Trust and
Savings Association, as Documentation Agent
1455 Market Street, 13th Floor
San Francisco, CA 94103
Ladies and Gentlemen:
I am General Counsel of The Vons Companies, Inc., a Michigan
corporation, ("Borrower") and have acted in such capacity in
connection with the Revolving Loan Agreement ("Agreement") dated
as of February 17, 1995, among Borrower and the Banks, and the
Loan Documents. This opinion is rendered to you pursuant to
Section 8.1(a) (5) of the Agreement. Capitalized terms used
herein and not otherwise defined shall have the meanings given
them in the Agreement.
In rendering this opinion, I have reviewed, and relied upon,
originals, or copies identified to my satisfaction as being true
copies, of the following:
1. The Agreement;
2. The Loan Documents delivered at the Closing (including
the Notes);
3. The Certificates or Articles of Incorporation or
equivalent documents and Bylaws of Borrower and each of its
Significant Subsidiaries, as amended to date, and the minutes of
the actions of the Board of Directors of Borrower and
each of its Significant Subsidiaries authorizing the Agreement
and the transactions contemplated thereby to the extent such
entity is a party thereto; and
4. Each certificate by an officer of Borrower or any of
its Significant Subsidiaries delivered on this date to the Agent
or the Banks pursuant to the Agreement.
In addition, I have discussed the Agreement, the Loan Documents
and relevant matters with responsible officers of Borrower, and
have reviewed such other documents, instruments and certificates
and have made such examination as to matters of fact and law as I
have deemed necessary or appropriate in order to render this
opinion to you.
In rendering this opinion, I have assumed:
(a) That the Loan Documents have been duly executed and
delivered by the parties thereto other than the Borrower and its
Significant Subsidiaries;
Bank of America National Trust and
Savings Association, as Documentation Agent
February 17, 1995
Page 2
(b) That enforcement of the Loan Documents will be
undertaken in good faith and in a commercially reasonable manner;
and
(c) That, other than with respect to the Loan Documents,
all signatures are genuine, all documents submitted to me as
originals are authentic originals, and all documents submitted to
me as copies conform to the originals.
Based on the foregoing, and relying thereon, and subject to the
limitations expressed below, I am of the opinion that, as of the
Closing Date:
A. Borrower and each of its Significant Subsidiaries have
been duly incorporated and are validly existing corporations in
good standing under the laws of their respective jurisdictions of
incorporation, with full corporate power and authority to own and
occupy their properties and conduct their businesses as presently
conducted, and Borrower and each of its Significant Subsidiaries
are registered or qualified to conduct business and are in good
standing in each jurisdiction in which the conduct of its
business or the ownership or leasing of its properties makes such
qualification necessary (except where the failure to be so duly
qualified and in good standing does not constitute a Material
Adverse Effect).
B. Borrower and each of its Significant Subsidiaries hold
all franchises, licenses, permits and other governmental
authorizations required for the conduct of their businesses and
such franchises, licenses, permits and other governmental
authorizations are in full force and effect other than
such franchises, licenses, permits and other governmental
authorizations as to which the failure so to maintain or obtain
would not constitute a Material Adverse Effect.
C. All outstanding shares of capital stock of Borrower and
all of the outstanding shares of capital stock of each of its
Significant Subsidiaries have been duly authorized and validly
issued, and all the outstanding shares of capital stock of
Borrower and its Significant Subsidiaries are fully paid and
nonassessable, and are free of preemptive rights; all of the
outstanding capital stock of each of Borrower's Significant
Subsidiaries is directly or indirectly owned by Borrower and, to
my best knowledge, all of the outstanding capital stock of each
of Borrower's Significant Subsidiaries is owned, free and clear
of any mortgage, pledge, security interest, claim, encumbrance or
other restriction on transferability or voting other than those
imposed by the Securities Act or state securities or blue sky
laws.
D. To my best knowledge there is no legal or governmental
proceeding pending or threatened or contemplated to which
Borrower is a party or of which the business or property of
Borrower or any of its Significant Subsidiaries is the subject
which, singularly or in the aggregate, if determined adversely to
Borrower or its Subsidiary, would constitute a Material Adverse
Effect.
E. Neither Borrower nor any of its Significant
Subsidiaries is (i) in violation of its charter or bylaws, or
other equivalent instruments, (ii) to my best knowledge, in
default in any respect in the performance of any obligation,
agreement or condition contained in any loan, bond, debenture,
note or any other evidence of indebtedness or any indenture,
mortgage, deed of trust, or any other agreement or instrument,
known to me, to which Borrower or any of its
Bank of America National Trust and
Savings Association, as Documentation Agent
February 17, 1995
Page 3
Significant Subsidiaries is a Party or by which it or any of them
is bound, or to which any of the property or assets of Borrower
or any of its Significant Subsidiaries is subject, which default
would constitute a Material Adverse Effect.
F. Borrower and the Significant Subsidiaries have full
corporate power and authority to enter into and perform the
obligations of Borrower and the Significant Subsidiaries,
respectively, under the Loan Documents.
G. The execution, delivery, and performance by Borrower
and by each of its Significant Subsidiaries of the Loan Documents
to which it is a party have been duly authorized by all necessary
corporate action of Borrower and its Significant subsidiaries,
and do not and will not:
(i) require any consent or approval not heretofore
obtained of any stockholder, partner, security holder or, to the
best of my knowledge, creditor of Borrower or any of its
Significant Subsidiaries;
(ii) violate or conflict with any provision of
Borrower's or any of its Significant Subsidiaries' certificate or
articles of incorporation or equivalent instruments or bylaws;
(iii) result in or require the creation or imposition
of any Lien or Right of Others upon or with respect to any
property now owned or leased or hereafter acquired by Borrower or
any of its Significant Subsidiaries, which creation or imposition
would constitute a Material Adverse Effect;
(iv) violate any Requirement of Law (including,
without limitation, Regulation U of the Board of Governors of the
Federal Reserve System) known to me presently in effect having
applicability to such party; or
(v) result in a breach of or constitute a default
under, or cause or permit the acceleration of any obligation owed
under, any indenture or loan agreement or credit agreement or any
other Contractual Obligation known to me to which such party or
any of its Property is bound or affected, which breach, default,
or acceleration would constitute a Material Adverse Effect.
H. No authorization, consent, approval, order, license or
permit from, or filing, registration, or qualification with, or
exemption of any of the foregoing from, any Governmental Agency
is or will be required to authorize or permit the execution and
delivery by Borrower or any Significant Subsidiary of Borrower of
the Loan Documents to which it is a party except as has already
been obtained or made.
I. Each Loan Document to which Borrower or any Significant
Subsidiary of Borrower is a party has been duly authorized,
executed and delivered by Borrower or such Significant Subsidiary
and constitutes a legal, valid and binding agreement of Borrower
or such Significant Subsidiary, enforceable against it in
accordance with its terms, except to the extent
Bank of America National Trust and
Savings Association, as Documentation Agent
February 17, 1995
Page 4
that (i) the enforceability thereof may be subject to Debtor
Relief Laws now or hereafter in effect, relating to creditors'
rights generally, (ii) the enforceability thereof may be subject
to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law) and to the discretion of the court before which any
proceeding may be brought, and (iii) the Loan Documents may be
subject to or limited by the unenforceability under certain
circumstances of provisions purporting to place venue for any
litigation of any disputes or controversies within a court of a
county or to waive the right to trial by jury.
J. The names, form of legal entity and jurisdictions of
incorporation of the Subsidiaries of Borrower set forth in
Schedule 4.4 to the Agreement are as set forth therein.
K. Neither Borrower nor any Significant Subsidiary of
Borrower is subject to regulation under the Public Utility
Holding Company Act of 1935, as amended, or the Investment
Company Act of 1940.
This opinion is limited to the laws of the state of California,
the Michigan Business Corporation Act, the General Corporation
Law of the State of Delaware, and the federal laws of the United
States, and I express no opinion and can assume no responsibility
as to the applicability of the laws of any other jurisdiction.
This opinion is rendered to you pursuant to Section 8.1(a)(5)
of the Agreement, is intended solely for your benefit and that of
the Banks, and may not be relied on without my prior written
consent by any other person other than any assignee or successor
in interest of any Bank or any person acquiring a participation
from any Bank.
Very truly yours,
/s/ Terrence J. Wallock
Terrence J. Wallock
<PAGE>
EXHIBIT E
REQUEST FOR LETTER OF CREDIT
----------------------------
1. This Request for Letter of Credit is executed and
delivered by a Responsible Official of The Vons Companies, Inc.,
a Michigan corporation ("Borrower") to the Issuing Bank named
below, pursuant to that certain Revolving Loan Agreement (the
"Agreement") dated as of February 17, 1995, entered into by and
among Borrower, the Banks that are parties thereto and Bank of
America National Trust and Savings Association and The Chase
Manhattan Bank, N.A., as Managing Agents. Terms defined in the
Agreement and not otherwise defined herein are used herein as
defined in the Agreement.
2. Borrower hereby requests that the Issuing Bank named
below issue a Letter of Credit for the account of Borrower
pursuant to the Agreement, as follows:
(a) Issuing Bank: .
------------------------------
(b) Amount of Letter of Credit: $ .
--------------
(c) Expiration Date: , 19 .
---------------------- --
(d) Type of Letter of Credit:
____
/___/ Commercial Letter of Credit
____
/___/ Standby Letter of Credit
(e) Other pertinent details as set forth in the attached
standard application for letter of credit of the
Issuing Bank.
3. The requested Letter of Credit is (check one box
only):
____
/___/ new Letter of Credit.
____
/___/ a supplement, modification, amendment, renewal,
or extension to or of the following outstanding
Letter(s) of Credit: [Identify]
--------
Page 1 of 3
4. In connection with the issuance of the Letter of Credit
requested herein, Borrower hereby represents, warrants, and
certifies to the Banks that as of the date of the issuance of the
Letter of Credit requested herein:
(a) If this request for Letter of Credit will increase
the aggregate principal Indebtedness evidenced by the Notes,
now and as of the date of the issuance of the Letter of
Credit, each representation and warranty made by Borrower in
Article 4 of the Agreement (other than the representations
and warranties contained in Sections 4.4(a), 4.5, 4.6,
4.7, 4.9, 4.12, 4.15 and 4.19) will be true and correct in
all material respects, both immediately before such Letter
of Credit is issued and after giving effect to such Letter
of Credit, as though such representations and warranties
were made on and as of the date of issuance of the Letter of
Credit and no event or circumstance that constitutes a
Material Adverse Effect shall have occurred since the
Closing Date;
(b) In all cases, now and as of the date of the
issuance of the Letter of Credit, each representation and
warranty made by Borrower in Sections 4.13 and 4.18 of the
Agreement will be true and correct in all material respects,
both immediately before such Letter of Credit is issued and
after giving effect to such Letter of Credit, as though such
representations and warranties were made on and as of the
date of such Letter of Credit.
(c) No event of Default presently exists or will have
occurred and be continuing as a result of the Letter of
Credit.
(d) Giving effect to the issuance of the Letter of
Credit requested hereby, the Syndicated Outstandings does
not exceed the commitment.
(If any of the foregoing statements is not true and correct,
attach a statement specifying in detail the circumstances thereof
and the actions Borrower is taking or proposes to take with
respect thereto.)
Page 2 of 3
5. This Request for Letter of Credit is executed on
, 19 , by a Responsible Official of Borrower,
- ----------- --
on behalf of Borrower. The undersigned, in such capacity, hereby
certifies each and every matter contained herein to be true and
correct.
BORROWER:
THE VONS COMPANIES, INC.,
a Michigan corporation
By:
---------------------------
Title:
-------------------------
Page 3 of 3
<PAGE>
EXHIBIT F
REQUEST FOR LOAN
----------------
1. This Request for Loan is executed and delivered by
Borrower to The Chase Manhattan Bank , N.A., as the
"Administrative Agent", pursuant to Section 2.1(b) of that
------
certain Revolving Loan Agreement (the "Loan Agreement") dated as
of February 17, 1995, entered into by and among THE VONS
COMPANIES, INC., a Michigan corporation, the Banks therein named
and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, and
The Chase Manhattan Bank, M.A., as Managing Agents for
themselves and for the Banks. Terms defined in the Loan
Agreement and not otherwise defined herein are used herein as
defined in the Loan Agreement.
2. Borrower hereby requests that the Banks make a Loan
for the account of Borrower (Account No. ) pursuant to
----------
the Loan Agreement as follows:
(a) Amount of Loan: $ .
----------------
(b) Date of Loan: , 19 .
--------------- ---
(c) Type of Loan (check one box only):
____
/___/ Alternate Base Rate Loan.
____
/___/ Eurodollar Rate Loan with -month
----
Eurodollar Period.
3. In connection with the Loan requested herein,
Borrower hereby represents, warrants, and certifies to the
Banks that:
(a) If the requested Loan is the initial Loan being
made on the Closing Date, then each of the representations
and warranties made by Borrower in Article 4 of the Loan
---------
Agreement is true and correct.
(b) In the case of each other Loan, as of the date
of the Loan requested herein, each of the representations
and warranties made by Borrower in Article 4 (other than
---------
there presentation and warranties contained in Sections
4.4(a), 4.5, 4.6, 4.7, 4.9, 4.12, 4.15 and 4.19) are true
------ --- --- --- --- ---- ---- ----
and correct in all material respects on and as of the date
of this Loan as though made on and as of the date of this
Loan, and no event of circumstance that constitutes a
Material Adverse Effect has occurred since the Closing Date
and there has not occurred an Event of Default that is
continuing as of the date of this Loan.
(c) In all cases now and as of the date of the
issuance of the Loan, each representation and warranty made
by Borrower in Sections 4.13 and 4.18 of the Agreement will
---- ----
be true and correct in all material respects, both
immediately before such Loan is made and after giving effect
to such Loan, as though such representations and warranties
were made on and as of the date of such Loan.
4. This Request for Loan is executed on , 19 ,
------- --
by a Responsible Official of Borrower, on behalf of Borrower.
The undersigned, in such capacity, hereby certifies each and
every matter contained herein to be true and correct.
BORROWER:
THE VONS COMPANIES, INC.,
a Michigan corporation
By
--------------------------
Title
---------------------
<PAGE>
EXHIBIT G
SUBSIDIARY GUARANTY
-------------------
This SUBSIDIARY GUARANTY (this "Guaranty"), dated as
of , 199 , is made by , a
---------------- -- ----------------
corporation (collectively with each other
- -----------------
Significant Subsidiary which may hereafter execute an instrument
of joinder with respect to this Subsidiary Guaranty
"Guarantors"), in favor of the "Banks" that are parties to the
Loan Agreement hereinafter referred to and in favor of The Chase
Manhattan Bank, N.A., in its capacity as Administrative Agent for
itself and the Banks under such Loan Agreement (the "Agent," the
Agent and the Banks at times referred to collectively herein as
"Lender"), with reference to the following facts:
RECITALS
--------
A. Pursuant to the Loan Agreement described below
entered into between Lender and THE VONS COMPANIES, INC.,
a Michigan corporation ("Borrower"), Lender is making certain
credit facilities available to Borrower.
B. As a condition to the availability of such credit
facilities, Guarantors are required to enter into this Guaranty
in their capacity as wholly-owned Subsidiaries of Borrower and to
guaranty the Guarantied Obligations as hereinafter provided.
C. Guarantors expect to realize direct and indirect
benefits as the result of the availability of the aforementioned
credit facilities, and as the result of the execution of this
Guaranty.
AGREEMENT
---------
NOW, THEREFORE, in order to induce Lender to extend
the aforementioned credit facilities, and for other good and
valuable consideration, the receipt and adequacy of which hereby
is acknowledged, Guarantors hereby represent, warrant, covenant,
agree and guaranty as follows:
1. Definitions. "Loan Agreement" means that certain
----------- --------------
Revolving Loan Agreement dated as of February 17, 1995, between
Lender and Borrower. This Guaranty is the Subsidiary Guaranty
referred to in the Loan Agreement and is one of the Loan
Documents. Terms defined in the Loan Agreement and not otherwise
defined in this Guaranty shall have the meanings given those
terms in the Loan Agreement when used herein and such definitions
are incorporated herein as though set forth in full. In
addition, as used herein, the following terms shall have the
meanings respectively set forth after each:
"Guarantied Obligations" means all obligations of
----------------------
Borrower under the Loan Documents, whether due or to become due,
matured or unmatured, liquidated or unliquidated, or contingent
or noncontingent, including obligations of performance as well as
---------
obligations of payment, and including interest that accrues after
---------
the commencement of any bankruptcy or insolvency proceeding by or
against Borrower, Guarantor or any other Person.
2. Guaranty of Guarantied Obligations. For valuable
----------------------------------
consideration, Guarantors hereby irrevocably, unconditionally,
jointly and severally guaranty and promise to pay and perform on
demand the Guarantied Obligations and each and every one of them,
including, without limitation, all amendments, modifications,
- ---------
supplements, renewals or extensions of any of them, whether such
amendments, modifications, supplements, renewals or extensions
are evidenced by new or additional instruments, documents or
agreements or change the rate of interest on any Guarantied
Obligation or the security therefor, or otherwise.
3. Nature of Guaranty. This Guaranty is irrevocable
------------------
and continuing in nature and relates to any Guarantied
Obligations now existing or hereafter arising. This Guaranty is
a guaranty of prompt and punctual payment and performance and is
not merely a guaranty of collection.
4. Relationship to Other Agreements. Nothing herein
--------------------------------
shall in any way modify or limit the effect of terms or
conditions set forth in any other document, instrument or
agreement executed by any Guarantor or in connection with the
Guarantied Obligations, but each and every term and condition
hereof shall be in addition thereto. All provisions contained in
the Loan Agreement or any other Loan Document that apply to Loan
Documents generally are fully applicable to this Guaranty and are
incorporated herein by this reference.
5. Subordination of Indebtedness of Borrower to a
----------------------------------------------
Guarantor to the Guarantied Obligations. Each Guarantor agrees
- ---------------------------------------
that:
(a) Any indebtedness of Borrower now or hereafter
owed to any Guarantor hereby is subordinated to the
Guarantied Obligations.
(b) If the Agent so requests, any such
indebtedness of Borrower now or hereafter owed to any
Guarantor shall be collected, enforced and received by such
Guarantor as trustee for Lender and shall be paid over to the
Agent in kind on account of the Guarantied Obligations, but
without reducing or affecting in any manner the obligations
of such Guarantor under the other provisions of this
Guaranty.
(c) Should such Guarantor fail to collect or
enforce any such indebtedness of Borrower now or hereafter
owed to such Guarantor and pay the proceeds thereof to the
Agent, the Agent as such Guarantor's attorney-in-fact may do
such acts and sign such documents in such Guarantor's name as
the Agent considers necessary or desirable to effect such
collection, enforcement and/or payment.
6. Statute of Limitations and Other Laws. Until the
-------------------------------------
Guarantied Obligations shall have been paid and performed in
full, all of the rights, privileges, powers and remedies granted
to Lender hereunder shall continue to exist and may be exercised
by Lender at any time and from time to time irrespective of the
fact that any of the Guarantied Obligations may have become
barred by any statute of limitations. Each Guarantor expressly
waives the benefit of any and all statutes of limitation, and any
and all laws providing for exemption of property from execution
or for valuation and appraisal upon foreclosure, to the maximum
extent permitted by applicable law.
7. Waivers and Consents. Each Guarantor
--------------------
acknowledges that the obligations undertaken herein involve the
guaranty of obligations of Persons other than such Guarantor and,
in full recognition of that fact, consents and agrees that Lender
may, at any time and from time to time, without notice or demand,
and without affecting the enforceability or continuing
effectiveness hereof: (a) supplement, modify, amend, extend,
renew, accelerate or otherwise change the time for payment or the
terms of the Guarantied Obligations or any part thereof,
including any increase or decrease of the rate(s) of interest
- ---------
thereon; (b) supplement, modify, amend or waive, or enter into or
give any agreement, approval or consent with respect to, the
Guarantied Obligations or any part thereof, or any of the Loan
Documents or any additional security or guaranties, or any
condition, covenant, default, remedy, right, representation or
term thereof or thereunder; (c)accept new or additional
instruments, documents or agreements in exchange for or relative
to any of the Loan Documents or the Guarantied Obligations or any
part thereof; (d) accept partial payments on the Guarantied
Obligations; (e) receive and hold additional security or
guaranties for the Guarantied Obligations or any part thereof;
(f) release, reconvey, terminate, waive, abandon, fail to
perfect, subordinate, exchange, substitute, transfer and/or
enforce any security or guaranties, and apply any security and
direct the order or manner of sale thereof as Lender in its sole
and absolute discretion may determine; (g) release any Person
from any personal liability with respect to the Guarantied
Obligations or any part thereof; (h) settle, release on terms
satisfactory to Lender or by operation of applicable laws or
otherwise liquidate or enforce any Guarantied Obligations and any
security or guaranty therefor in any manner, consent to the
transfer of any security and bid and purchase at any sale; and/or
(i) consent to the merger, change or any other restructuring or
termination of the corporate existence of Borrower, any Guarantor
or any other Person, and correspondingly restructure the
Guarantied Obligations, and any such merger, change,
restructuring or termination shall not affect the liability of
any Guarantor or the continuing effectiveness hereof, or the
enforceability hereof with respect to all or any part of the
Guarantied Obligations.
Upon the occurrence and during the continuance of any
Event of Default, Lender may enforce this Guaranty independently
of any other remedy or security Lender at any time may have or
hold in connection with the Guarantied Obligations, and it shall
not be necessary for Lender to marshal assets in favor of
Borrower, any Guarantor or any other Person or to proceed upon or
against and/or exhaust any security or remedy before proceeding
to enforce this Guaranty. Each Guarantor expressly waives any
right to require Lender to marshal assets in favor of Borrower,
any Guarantor or any other Person or to proceed against Borrower,
any Guarantor or any collateral provided by any Person, and
agrees that Lender may proceed against Borrower, any Guarantor
and/or any collateral in such order as it shall determine in its
sole and absolute discretion. Lender may file a separate action
or actions against Borrower and/or any Guarantor without respect
to whether action is brought or prosecuted with respect to any
security or against any other Person, or whether any-other Person
is joined in any such action or actions. Each Guarantor agrees
that Lender and Borrower and any affiliate of Borrower may deal
with each other in connection with the Guarantied Obligations or
otherwise, or alter any contracts or agreements now or hereafter
existing between any of them, in any manner whatsoever, all
without in any way altering or affecting the security of this
Guaranty. Lender's rights hereunder shall be reinstated and
revived, and the enforceability of this Guaranty shall continue,
with respect to any amount at any time paid on account of the
Guarantied Obligations which thereafter shall be required to be
restored or returned by Lender upon the bankruptcy, insolvency or
reorganization of Borrower or any other Person, or otherwise, all
as though such amount had not been paid. The rights of Lender
created or granted herein and the enforceability of this Guaranty
with respect to each Guarantor at all times shall remain
effective to guaranty the full amount of all the Guarantied
Obligations even though the Guarantied Obligations, or any part
thereof, or any security or guaranty therefor, may be or
hereafter may become invalid or otherwise unenforceable as
against Borrower or any other guarantor or surety and whether or
not Borrower shall have any personal liability with respect
thereto. Each Guarantor expressly waives any and all defenses
now or hereafter arising or asserted by reason of (a) any
disability or other defense of Borrower with respect to the
Guarantied Obligations, (b) the unenforceability or invalidity of
any security or guaranty for the Guarantied Obligations or the
lack of perfection or continuing perfection or failure of
priority of any security for the Guarantied Obligations, (c) the
cessation for any cause whatsoever of the liability of Borrower
(other than by reason of the full payment and performance of all
Guarantied Obligations), (d) any failure of Lender to marshal
assets in favor of Borrower or any other Person, (e) any failure
of Lender to give notice of sale or other disposition of any
collateral to Borrower, any Guarantor or any other Person or any
defect in any notice that may be given in connection with any
sale or disposition of any collateral, (f) any failure of Lender
to comply with applicable laws in connection with the sale or
other disposition of any collateral or other security for any
Guarantied Obligation, including, without limitation, any failure
---------
of Lender to conduct a commercially reasonable sale or other
disposition of any collateral or other security for any
Guarantied Obligation, (g) any act or omission of Lender or
others that directly or indirectly results in or aids the
discharge or release of Borrower or the Guarantied Obligations or
any security or guaranty therefor by operation of law or
otherwise, (h) any law which provides that the obligation
of a surety or guarantor must neither be larger in amount nor in
other respects more burdensome than that of the principal or
which reduces a surety's or guarantor's obligation in proportion
to the principal obligation, (i) any failure of Lender to file or
enforce a claim in any bankruptcy or other proceeding with
respect to any Person, (j) the election by Lender, in any
bankruptcy proceeding of any Person, of the application or
non-application of Section 1111(b)(2) of the United States
Bankruptcy Code, (k) any extension of credit or the grant of any
lien under Section 364 of the United States Bankruptcy Code, (l)
any use of cash collateral under Section 363 of the United States
Bankruptcy Code, (m) any agreement or stipulation with respect to
the provision of adequate protection in any bankruptcy proceeding
of any Person, (n) the avoidance of any lien in favor of Lender
for any reason, (o) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, liquidation or dissolution
proceeding commenced by or against any Person, including any
---------
discharge of, or bar or stay against collecting, all or any of
the Guarantied Obligations (or any interest thereon) in or as a
result of any such proceeding, or (p) any action taken by Lender
that is authorized by this Section 7 or any other provision
-
of any Loan Document. Each Guarantor expressly waives all
setoffs and counterclaims and all presentments, demands or
payment or performance, notices of nonpayment or nonperformance,
protests, notices of protest, notices of dishonor and all other
notices or demands of any kind or nature whatsoever with respect
to the Guarantied Obligations, and all notices of acceptance of
this Guaranty or of the existence, creation or incurring of new
or additional Guarantied Obligations.
8. Condition of Borrower. Each Guarantor represents
---------------------
and warrants to Lender that it has established adequate means of
obtaining financial and other information pertaining to the
businesses, operations and condition (financial and otherwise) of
Borrower and its properties on a continuing basis, and that such
Guarantor now is and hereafter will be completely familiar with
the businesses, operations and condition (financial and
otherwise) of Borrower and its properties. Each Guarantor hereby
expressly waives and relinquishes any duty on the part of Lender
(should any such duty exist) to disclose to any Guarantor any
matter, fact or thing related to the businesses, operations or
condition (financial or otherwise) of Borrower or its properties,
whether now known or hereafter known by Lender during the life of
this Guaranty. With respect to any of the Guarantied
Obligations, Lender need not inquire into the powers of Borrower
or the officers or employees acting or purporting to act on its
behalf, and all Guarantied Obligations made or created in good
faith reliance upon the professed exercise of such powers shall
be guarantied hereby.
9. Liens on Real Property. In the event that all or
----------------------
any part of the Guarantied Obligations at any time are secured by
any one or more deeds of trust or mortgages or other instruments
creating or granting liens on any interests in real property,
each Guarantor authorizes Lender, upon the occurrence of and
during the continuance of any Event of Default, at its sole
option, without notice or demand and without affecting any
Guarantied Obligations of any Guarantor, the enforceability of
this Guaranty, or the validity or enforceability of any liens of
Lender on any collateral, to foreclose any or all of such deeds
of trust or mortgages or other instruments by judicial or
nonjudicial sale. Each Guarantor expressly waives any defenses
to the enforcement of this Guaranty or any rights of Lender
created or granted hereby or to the recovery by Lender against
Borrower, any Guarantor or any other Person liable therefor of
any deficiency after a judicial or nonjudicial foreclosure or
sale, even though such a foreclosure or ale may impair the
subrogation rights of any Guarantor or may preclude any Guarantor
from obtaining reimbursement or contribution from Borrower. Each
Guarantor expressly waives any defenses or benefits that may be
derived from California Code of Civil Procedure Section 580a,
580b, 580d or 726, or comparable provisions of the laws of any
other jurisdiction, and all other suretyship defenses it
otherwise might or would have under California law or other
applicable law. Each Guarantor expressly waives any right
to receive notice of any judicial or nonjudicial foreclosure or
sale of any real property or interest therein subject to any such
deeds of trust or mortgages or other instruments and any
Guarantor's or any other Person's failure to receive any such
notice shall not impair or affect Guarantor's Obligations or the
enforceability of this Guaranty or any rights of Lender created
or granted hereby.
10. Waiver of Rights of Subrogation. Notwithstanding
-------------------------------
anything to the contrary elsewhere contained herein, each
Guarantor hereby expressly waives with respect to Borrower and
its successors and assigns and any other Person, any and all
rights at Law or in equity to subrogation, reimbursement,
exoneration, contribution, setoff, share in any collateral or any
other rights that could accrue to a surety against a principal,
to a guarantor against a maker or obligor, to an accommodation
party against the party accommodated, or to a holder or
transferee against a maker, and which that Guarantor may have or
hereafter acquire against Borrower or any other Person in
connection with or as a result of that Guarantor's execution,
delivery and\or performance of this Guaranty. In furtherance of
the foregoing, each Guarantor agrees that any payment by that
Guarantor to Lender pursuant to this Guaranty shall be deemed a
contribution to the capital of Borrower and no such payment shall
make that Guarantor a creditor of Borrower. Each Guarantor
hereby acknowledges and agrees that the foregoing waivers are
intended to benefit Borrower and Lender and shall not limit or
otherwise affect any Guarantor's liability hereunder or the
enforceability hereof.
11. Understandings With Respect to Waivers and
------------------------------------------
Consents. Each Guarantor warrants and agrees that each of the
- --------
waivers and consents set forth herein are made after consultation
with legal counsel and with full knowledge of their significance
and consequences, with the understanding that events giving rise
to any defense or right waived may diminish, destroy or otherwise
adversely affect rights which such Guarantor otherwise may have
against Borrower, Lender or others, or against any collateral,
and that, under the circumstances, the waivers and consents
herein given are reasonable and not contrary to public policy or
law. If any of the waivers or consents herein are determined to
be unenforceable under applicable law, such waivers and consents
shall be effective to the maximum extent permitted by law.
12. Costs and Expenses. Each Guarantor agrees to pay
------------------
to Lender all costs and expenses (including, without limitation,
---------
reasonable attorneys' fees and disbursements) incurred by Lender
in the enforcement or attempted enforcement of this Guaranty,
whether or not an action is filed in connection therewith, and in
connection with any waiver or amendment of any term or provision
hereof. All advances, charges, costs and expenses, including
---------
reasonable attorneys' fees and disbursements, incurred or paid by
Lender in exercising any right, privilege, power or remedy
conferred by this Guaranty, or in the enforcement or attempted
enforcement thereof, shall be subject hereto and shall become a
part of the Guarantied Obligations and shall be paid to Lender by
each Guarantor, immediately upon demand, together with interest
thereon at the rate(s) provided for under the Loan Agreement.
13. Construction of This Guaranty. This Guaranty is
-----------------------------
intended to give rise to absolute and unconditional obligations
--------------------------
on the part of each Guarantor; hence, in any construction hereof,
notwithstanding any provision of any Loan Document to the
- ---------------------------------------------------------
contrary, this Guaranty shall be construed strictly in favor of
- --------
Lender in order to accomplish its stated purpose.
14. Liability. The liability of each Guarantor
---------
hereunder is independent of any other guaranties at any time in
effect with respect to all or any part of the Guarantied
Obligations, and each Guarantor's liability hereunder may be
enforced regardless of the existence of any such guaranties.
Any termination by or release of any guarantor in whole or in
part (whether it be another Guarantor under this instrument or
not) shall not affect the continuing liability of any Guarantor
hereunder, and no notice of any such termination or release shall
be required. The execution hereof by each Guarantor is not
founded upon an expectation or understanding that there will be
any other guarantor of the Guarantied Obligations.
15. Termination of Guaranty. The liability of each
-----------------------
Guarantor under this Guaranty shall terminate (i) concurrently
with the sale or other disposition of that Guarantor to a Person
which is not an Affiliate of Borrower pursuant to a transaction
which does not violate Sections 6.2 and 6.3 of the Loan Agreement
or (ii) concurrently with the delivery to the Agent of a
Certificate of a Senior Officer of Borrower to the effect that
Guarantor is no longer a Significant Subsidiary by reason of a
diminution in the value of the assets of that Guarantor.
IN WITNESS WHEREOF, each Guarantor has executed this
Guaranty by its duly authorized officers as of the date first
written above.
---------------------------------
a corporation
----------------
By:
------------------------------
Title:
---------------------------
By:
------------------------------
Title:
---------------------------
Exhibit H
$ Date
---------------------- ----------------------
MULTIPLE ADVANCE NOTE
For value received, The Vons Companies, Inc., a Michigan
corporation ("Company") promises to pay to the order of
--------
("Bank") at its office at
- ---------------------- --------------
, each
- -----------------------------------------------------------
sum ("Advance") advanced to or for the benefit of the undersigned
hereunder on the maturity date for that Advance recorded by the
Bank on the schedule annexed hereto. The undersigned further
promises to pay interest on each Advance from the date thereof
until paid at a rate per annum, equal to the Applicable Rate.
The Applicable Rate, for any Advance, shall be defined as the
rate quoted to the Company and agreed upon between Company and
Bank (expressed as an annual rate) for that Advance and recorded
by the Bank on the schedule annexed hereto.
Principal and interest on each Advance shall be due and
payable on the maturity date for that Advance recorded by the
Bank on the schedule annexed hereto. Prepayment is not
permitted. Interest shall be calculated on the basis of the
actual number of days the unpaid principal balance is outstanding
divided by a 360 day year. Principal and interest not paid when
due shall thereafter bear interest at the Bank's floating "Prime"
or "Reference" rate.
The outstanding principal balance due hereunder may
fluctuate up and down from time to time at Company' option, but
shall not exceed $ in aggregate principle amount
---------
outstanding at any one time. The excess of Advances over
repayments shall evidence the principal balance due hereon from
time to time and at any time. Advances hereunder may be made
upon the oral, telephonic or written request of any person
authorized to borrow or any person Bank reasonable believes is
authorized to borrow. Any advance hereunder shall be
conclusively presumed to have been made to and at the request and
for the benefit of the undersigned when the proceeds of such
Advance are deposited to the credit of the undersigned in
the account of Company with Bank or, if Company does not maintain
an account with Bank, when the proceeds are wire transferred to
The Chase Manhattan Bank, N.A., New York, for credit to Company's
account, regardless of the fact that persons other than those
authorized to borrow may have authority to draw against such
account.
Principal and interest payments shall be in money of the
United States of America, lawful at such times for the
satisfaction of public and private debts, and shall be in
immediately available funds, or in Federal Funds. The books and
records of the Bank shall be conclusive evidence of any advance
or payment hereunder absent manifest error.
The Company hereby waives diligence, presentment, demand,
protest and notice and notice of any kind whatsoever. The
Company promises to pay cost of collection and reasonable
attorney's fees if default is made in the payment of the Note.
The right to plead any and all statues of limitation as a defense
to this Note or to any agreement to pay the same, is hereby
expressly waived by the undersigned to the full extent permitted
by law.
In the event of a default in the terms and provisions of
this Note the whole amount of principle and interest shall, at
the option of the holder of this Note become immediately due and
payable without diligence, demand, presentment, protest, or
notice of any kind whatsoever. Should the Company (i) commence a
voluntary case under any applicable bankruptcy, insolvency or
other similar law, (ii) consent to or, for over sixty days, be
subject to an order for relief in an involuntary case under any
such law, (iii) admit insolvency or the general inability to pay
it debts a they become due, or (iv) make an assignment of
substantially all of its assets for the benefit of creditors, the
then unpaid principal and interest shall be automatically and
immediately due and payable, all without demand, presentment or
notice.
This Note shall be governed by and constructed under the
law of the state of California.
IN WITNESS WHEREOF, the undersigned has caused this Note to
be executed by its officer thereunto duly authorized and directed
by appropriate corporate authority.
THE VONS COMPANIES, INC.,
a Michigan corporation
By:
---------------------------------
Its:
---------------------------------
By:
----------------------------------
Its:
---------------------------------
[ARTICLE] 5
[LEGEND]
This schedule contains summary financial information extratcted from the
Company's Consolidated Statements of Operations for the twelve weeks
ended March 26, 1995, the Consolidated Balance Sheets as of March 26, 1995
and the accompanying notes thereto and is qualified in its
entirety by reference to such financial statements.
[MULTIPLIER] 1,000
<TABLE>
<S> <C>
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] JAN-01-1995
[PERIOD-START] JAN-02-1995
[PERIOD-END] MAR-26-1995
[CASH] 6,500
[SECURITIES] 0
[RECEIVABLES] 36,000
[ALLOWANCES] 0
[INVENTORY] 339,700
[CURRENT-ASSETS] 440,900
[PP&E] 1,663,400
[DEPRECIATION] 468,800
[TOTAL-ASSETS] 2,186,000
[CURRENT-LIABILITIES] 546,400
[BONDS] 763,500
[COMMON] 4,300
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 562,300
[TOTAL-LIABILITY-AND-EQUITY] 2,186,000
[SALES] 1,142,500
[TOTAL-REVENUES] 1,142,500
[CGS] 851,000
[TOTAL-COSTS] 1,100,300
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 16,100
[INCOME-PRETAX] 26,100
[INCOME-TAX] 12,100
[INCOME-CONTINUING] 14,000
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 14,000
[EPS-PRIMARY] 0.32
[EPS-DILUTED] 0.32
</TABLE>
