FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended April 30, 1996
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 0-14625
TECH DATA CORPORATION
---------------------
(Exact name of registrant as specified in its charter)
Florida No. 59-1578329
------- --------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
5350 Tech Data Drive, Clearwater, Florida 34620
- ----------------------------------------- -----
(Address of principal executive offices) ( Zip Code)
Registrant's telephone number, including area code:(813) 539-7429
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 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___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Outstanding at
CLASS May 31, 1996
----- ------------
Common stock, par value $.0015 per share 38,274,871
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
Form 10-Q For The Quarter Ended April 30, 1996
INDEX
PART I. FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Consolidated Balance Sheet as of
April 30, 1996 (unaudited) and
January 31, 1996 3
Consolidated Statement of Income
(unaudited) for the three months ended
April 30, 1996 and 1995 4
Consolidated Statement of Cash Flows
(unaudited) for the three months
ended April 30, 1996 and 1995 5
Notes to Consolidated Financial Statements
(unaudited) 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-8
PART II. OTHER INFORMATION
All items required in Part II have been previously filed, have been
included in Part I of this report or are not applicable for the
quarter ended April 30, 1996.
SIGNATURES 9
2
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(In thousands, except share amounts)
<TABLE>
<CAPTION>
April 30, January 31,
1996 1996
------------- -------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 919 $ 1,154
Accounts receivable, less allowance for
doubtful accounts of $24,008 and $22,669 486,297 445,202
Inventories 430,695 465,422
Prepaid and other assets 34,379 39,010
----------- -----------
Total current assets 952,290 950,788
Property and equipment, net 60,366 61,610
Excess of cost over acquired net assets, net 6,263 6,376
Other assets 24,375 25,105
----------- -----------
$1,043,294 $1,043,879
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Revolving credit loans $ 300,327 $ 283,100
Current portion of long-term debt 423 519
Accounts payable 400,227 433,374
Accrued expenses 33,159 32,091
----------- -----------
Total current liabilities 734,136 749,084
Long-term debt 9,048 9,097
----------- -----------
743,184 758,181
----------- -----------
Commitments and contingencies
Shareholders' equity:
Preferred stock, par value $.02; 226,500 shares
authorized and issued; liquidation
preference $.20 per share 5 5
Common stock, par value $.0015; 100,000,000
shares authorized; 38,238,799 and 37,930,655
issued and outstanding 57 57
Additional paid-in capital 134,407 130,045
Retained earnings 163,738 153,310
Cumulative translation adjustment 1,903 2,281
----------- -----------
Total shareholders' equity 300,110 285,698
----------- -----------
$1,043,294 $1,043,879
=========== ===========
</TABLE>
The accompanying Notes to Consolidated Financial Statements
are an integral part of these financial statements.
3
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three months ended
April 30,
--------------------------
1996 1995
-------- --------
<S> <C> <C>
Net sales $985,574 $633,460
-------- --------
Cost and expenses:
Cost of products sold 916,562 587,244
Selling, general and
administrative expenses 46,285 38,061
-------- --------
962,847 625,305
-------- --------
Operating profit 22,727 8,155
Interest expense 5,523 5,057
-------- --------
Income before income taxes 17,204 3,098
Provision for income taxes 6,776 1,249
-------- --------
Net income $ 10,428 $ 1,849
======== ========
Net income per common share $ .27 $ .05
======== ========
Weighted average common
shares outstanding 38,589 38,063
======== ========
</TABLE>
The accompanying Notes to Consolidated Financial Statements
are an integral part of these financial statements.
4
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(In thousands)
<TABLE>
<CAPTION>
Three months ended
April 30,
----------------------------
1996 1995
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Cash received from customers $939,927 $615,340
Cash paid to suppliers and employees (947,485) (585,490)
Interest paid (5,358) (5,112)
Income tax refunds received (taxes paid) (6,550) 591
-------- --------
Net cash provided by (used in) operating activities (19,466) 25,329
-------- --------
Cash flows from investing activities:
Capital expenditures (2,213) (4,726)
-------- --------
Cash flows from financing activities:
Proceeds from issuance of common stock 4,362 773
Net (repayments) borrowings under revolving credit loans 17,227 (21,134)
Principal payments on long-term debt (145) (176)
-------- --------
Net cash provided by (used in) financing activities 21,444 (20,537)
-------- --------
Net (decrease) increase in cash and cash equivalents (235) 66
Cash and cash equivalents at beginning of period 1,154 496
-------- --------
Cash and cash equivalents at end of period $ 919 $ 562
======== ========
Reconciliation of net income to net cash provided by
(used in) operating activities:
Net income $ 10,428 $ 1,849
-------- --------
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 4,696 3,954
Provision for losses on accounts receivable 4,552 4,042
(Increase) decrease in assets
Accounts receivable (45,647) (18,120)
Inventories 34,727 28,737
Prepaid and other assets 3,857 (14,898)
Increase (decrease) in liabilities:
Accounts payable (33,147) 17,695
Accrued expenses 1,068 2,070
-------- --------
Total adjustments (29,894) 23,480
-------- --------
Net cash (used in) provided by operating activities $(19,466) $ 25,329
======== ========
</TABLE>
The accompanying Notes to Consolidated Financial Statements
are an integral part of these financial statements.
5
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Basis of presentation
- ---------------------
The consolidated financial statements included herein have been prepared by the
Company, without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission. In the opinion of management, the accompanying
unaudited consolidated financial statements contain all adjustments, consisting
of only normal recurring adjustments, necessary to present fairly the financial
position of Tech Data Corporation and subsidiaries (the "Company") as of April
30, 1996 and the results of their operations and cash flows for the three months
ended April 30, 1996 and 1995. All significant intercompany accounts and
transactions have been eliminated in consolidation. The results of operations
for the three months ended April 30, 1996 are not necessarily indicative of the
results that can be expected for the entire fiscal year ending January 31, 1997.
Net income per common share
- ---------------------------
Net income per share of common stock is based on the weighted average number of
shares of common stock and common stock equivalents outstanding during each
period. Fully diluted and primary earnings per share are the same amounts for
each of the periods presented.
6
<PAGE>
TECH DATA CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
- ---------------------
Three Months Ended April 30, 1996 and 1995
- ------------------------------------------
Net sales increased 55.6% to $985.6 million in the first quarter of fiscal 1997
compared to $633.5 million in the first quarter last year. This increase is
attributable to the addition of new product lines and the expansion of existing
product lines combined with an increase in the Company's market share. The
growth rate in the first quarter of fiscal 1997 was also positively impacted by
a lower growth rate in the prior comparable period as the Company was recovering
from the effects of business interruptions caused by the conversion to a new
computer system in December 1994. The Company's U.S. and international sales
grew 58% and 43%, respectively, in the first quarter of fiscal 1997 compared to
the prior year first quarter. International sales were approximately 14% of
fiscal 1997 first quarter net sales compared to 15% for the first quarter of
fiscal 1996.
The cost of products sold as a percentage of net sales increased to 93.0% in the
first quarter of fiscal 1997 from 92.7% in the prior year. This increase is a
result of competitive market prices and the Company's strategy of lowering
selling prices in order to gain market share and to pass on the benefit of
operating efficiencies to its customers.
Selling, general and administrative expenses increased by 21.6% to $46.3 million
in the first quarter of fiscal 1997 compared to $38.1 million in the prior year
and decreased as a percentage of net sales to 4.7% in the first quarter of
fiscal 1997 compared to 6.0% in the first quarter last year. Selling, general
and administrative expenses were a greater percentage of net sales during the
first quarter of fiscal 1996 primarily as a result of increased hiring in
anticipation of sales growth which was lower than expected due to the effects of
the business interruptions caused by the computer system conversion, in addition
to expenses related to this conversion. The dollar value increase is primarily
the result of expanded employment and increases in other administrative expenses
needed to support the increased volume of business.
As a result of the factors discussed above, operating profit increased 178.7% to
$22.7 million, or 2.3% of net sales, in the first quarter of fiscal 1997
compared to $8.2 million, or 1.3% of net sales for the first quarter last year.
Interest expense increased in the first quarter of fiscal 1997 due to an
increase in the Company's average outstanding indebtedness, partially offset by
decreases in short-term interest rates on the Company's floating rate
indebtedness.
As a result of the factors discussed above, net income increased 464.0% to $10.4
million, or $.27 per share, in the first quarter of fiscal 1997 compared to $1.8
million, or $.05 per share, in the prior year comparable quarter.
7
<PAGE>
Liquidity and Capital Resources
- -------------------------------
Net cash used in operating activities of $19.5 million during the first quarter
of fiscal 1997 was primarily attributable to growth in sales and the resulting
increase in accounts receivable.
Net cash used in investing activities of $2.2 million during the first quarter
of fiscal 1997 was a result of the Company making capital expenditures to expand
its management information system capability, office facilities and distribution
centers. The Company expects to make capital expenditures of approximately $25
million during fiscal 1997 to further expand its management information system
capability, office facilities and distribution centers.
Net cash provided by financing activities of $21.4 million during the first
quarter of fiscal 1997 was primarily provided by additional borrowings under the
Company's revolving credit loans.
In May 1996, the Company entered into a new $290 million, three-year,
multi-currency revolving credit facility. As of May 31, 1996, the Company had
total available credit lines of approximately $550 million (including the $250
million Receivables Securitization Program), of which approximately $325 million
was outstanding. The Company believes that cash from operations, available and
obtainable bank credit lines and trade credit from its vendors will be
sufficient to satisfy its working capital and capital expenditure needs during
fiscal 1997.
The Company has historically relied upon cash generated from operations, bank
credit lines, trade credit from its vendors and proceeds from prior public
offerings of common stock to satisfy capital needs and finance growth. Although
management believes the Company's liquidity at April 30, 1996 is sufficient to
fund the current level of operations through fiscal 1997, completion of the
Company's proposed July 1996 offering of 6 million shares of common stock is
expected to provide additional capital of approximately $135 million which, will
further assist the Company to strengthen its financial position and allow it to
accelerate its growth.
Asset Management
- ----------------
The Company manages its inventories by maintaining sufficient quantities to
achieve high order fill rates while attempting to stock only those products in
high demand with a rapid turnover rate. Inventory balances fluctuate as the
Company adds new product lines and when appropriate, makes large purchases,
including cash purchases from manufacturers and publishers when the terms of
such purchases are considered advantageous. The Company's contracts with most of
its vendors provide price protection and stock rotation privileges to reduce the
risk of loss due to manufacturer price reductions and slow moving or obsolete
inventory. In the event of a vendor price reduction, the Company generally
receives a credit for the impact on products in inventory. In addition, the
Company has the right to rotate a certain percentage of purchases, subject to
certain limitations. Historically, price protection and stock rotation
privileges as well as the Company's inventory management procedures have helped
to reduce the risk of loss of carrying inventory.
The Company attempts to control losses on credit sales by closely monitoring
customers' creditworthiness through its computer system which contains detailed
information on each customer's payment history and other relevant information.
In addition, the Company participates in a national credit association which
exchanges credit information on mutual customers. The Company has recently
obtained domestic credit insurance which insures a percentage of the credit
extended by the Company to certain of its larger customers against possible
loss. Customers who qualify for credit terms are typically granted net 30-day
payment terms. The Company also sells products on a prepay, credit card, cash on
delivery and floorplan basis.
8
<PAGE>
Comments on Forward-Looking Information
- ---------------------------------------
In connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, the Company filed a Form 8-K with the Securities
Exchange Commission on March 26, 1996 outlining cautionary statements
identifying important factors that could cause the Company's actual results to
differ materially from those projected in forward-looking statements made by, or
on behalf of, the Company. Such forward-looking statements, as made within this
Form 10-Q, should be considered in conjunction with the information included
within the Form 8-K.
9
<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.
TECH DATA CORPORATION
---------------------
(Registrant)
Signature Title Date
--------- ------- ----
/s/ Steven A. Raymund Chairman of the Board of June 13, 1996
- ----------------------- Directors; Chief
Steven A. Raymund Executive Officer
/s/ Jeffery P. Howells Senior Vice President of Finance June 13, 1996
- ---------------------- and Chief Financial Officer;
Jeffery P. Howells (principal financial officer)
/s/ Joseph B. Trepani Vice President and Worldwide June 13, 1996
- --------------------- Controller; (principal accounting
Joseph B. Trepani officer)
<PAGE>
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
--- -----------
10-QQ Revolving Credit and Reimbursement Agreement
dated May 23, 1996
27 Financial Data Schedule for Quarterly Report on Form 10Q
for the Quarter ended April 30, 1996
REVOLVING CREDIT AND
REIMBURSEMENT AGREEMENT
by and among
TECH DATA CORPORATION
TECH DATA FRANCE, S.N.C.,
as Multicurrency Facilities Borrowers
TECH DATA CANADA INC.,
as TD Canada
NATIONSBANK, NATIONAL ASSOCIATION,
CIBC INC.,
BARNETT BANK OF PINELLAS COUNTY,
NBD BANK,
THE BANK OF NOVA SCOTIA,
CREDIT LYONNAIS,
ROYAL BANK OF CANADA,
PNC BANK, KENTUCKY, INC.
SOUTHTRUST BANK OF ALABAMA, NATIONAL ASSOCIATION
FIRST UNION NATIONAL BANK OF FLORIDA,
DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLANDS BRANCHES
and
THE SAKURA BANK, LIMITED,
as Domestic Facilities Lenders
CANADIAN IMPERIAL BANK OF COMMERCE
and
THE BANK OF NOVA SCOTIA,
as Canadian Facilities Lenders
and
NATIONSBANK, NATIONAL ASSOCIATION, as Agent
and
CANADIAN IMPERIAL BANK OF COMMERCE,
as Canadian Agent
May 23, 1996
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Terms
1.01 Definitions .......................................................... 3
1.02 Rules of Interpretation .............................................. 35
ARTICLE II
The Multicurrency Facilities
2.01 Revolving Credit Facility ............................................ 37
2.02 Payment of Interest .................................................. 41
2.03 Payment of Principal ................................................. 42
2.04 Competitive Bid Loans ................................................ 43
2.05 Multicurrency Facilities Notes ....................................... 47
2.06 Pro Rata Payments .................................................... 48
2.07 Reductions ........................................................... 48
2.08 Increase and Decrease in Amounts ..................................... 49
2.09 Conversions and Elections of Subsequent
Interest Periods ..................................................... 49
2.10 Unused Fee ........................................................... 50
2.11 Deficiency Advances .................................................. 50
2.12 Adjustments by Agent ................................................. 51
2.13 Use of Proceeds ...................................................... 51
2.14 Extension of Revolving Credit Termination Date ....................... 51
2.15 Swing Line ........................................................... 51
2.16 Additional Multicurrency Facilities Borrowers ........................ 53
2.17 One Loan ............................................................. 54
2.18 Letters of Credit .................................................... 55
2.19 Acceptances .......................................................... 55
2.20 Creation of Acceptance ............................................... 56
2.21 Reimbursement ........................................................ 57
2.22 Domestic Letter of Credit Fee ........................................ 62
2.23 Administrative Fees and Reserves ..................................... 62
ARTICLE III
CANADIAN FACILITIES
3.01 Revolving Credit Facility ............................................ 63
3.02 Payment of Interest .................................................. 67
3.03 Payment of Principal ................................................. 69
3.04 Evidence of Indebtedness ............................................. 70
3.05 Pro Rata Payments .................................................... 70
3.06 Reductions ........................................................... 71
3.07 Increase and Decrease in Amounts ..................................... 71
3.08 Conversions and Elections of Subsequent
Interest Periods ..................................................... 71
3.09 Unused Fee ........................................................... 72
i
<PAGE>
3.10 Deficiency Advances .................................................. 72
3.11 Use of Proceeds ...................................................... 73
3.12 Extension of Revolving Credit Termination Date ....................... 73
3.13 Letters of Credit .................................................... 73
3.14 Acceptances .......................................................... 74
3.15 Reimbursement ........................................................ 77
3.16 Canadian Letter of Credit Fee ........................................ 81
3.17 Administrative Fees and Reserves ..................................... 82
3.18 Maximum Rate of Return ............................................... 82
3.19 Reset of Canadian Lenders, Portion on Default ........................ 82
ARTICLE IV
Yield Protection and Illegality
4.01 Additional Costs ..................................................... 83
4.02 Suspension of Loans .................................................. 84
4.03 Illegality ........................................................... 85
4.04 Compensation ......................................................... 85
4.05 Alternate Loan and Lender ............................................ 86
4.06 Taxes ................................................................ 86
4.07 Restricted Lender .................................................... 88
4.08 Funding .............................................................. 88
ARTICLE V
Conditions to Making Loans, Issuing
Letters of Credit and Creating Acceptances
5.01 Conditions of Initial Advance and Issuance
of Letters of Credit and Creating Acceptances ........................ 89
5.02 Conditions of Loans .................................................. 91
ARTICLE VI
Security
6.01 Guaranties ........................................................... 93
6.02 Further Assurances ................................................... 93
6.03 New Subsidiaries ..................................................... 93
ARTICLE VII
Representations and Warranties
7.01 Representations and Warranties as to Borrowers
and Subsidiaries ..................................................... 94
7.02 Representations and Warranties of TDC ................................ 95
ii
<PAGE>
ARTICLE VIII
Affirmative Covenants
8.01 Financial Reports, Etc............................................... 101
8.02 Maintain Properties.................................................. 102
8.03 Existence, Qualification, Etc........................................ 102
8.04 Regulations and Taxes................................................ 103
8.05 Insurance............................................................ 103
8.06 True Books........................................................... 103
8.07 Pay Indebtedness to Lenders and Perform
Other Covenants...................................................... 103
8.08 Right of Inspection.................................................. 103
8.09 Observe all Laws..................................................... 103
8.10 Covenants Extending to Subsidiaries.................................. 103
8.11 Officer's Knowledge of Default....................................... 104
8.12 Suits or Other Proceedings........................................... 104
8.13 Environmental Reports................................................ 104
8.14 Notice of Discharge of Hazardous Material
or Environmental Complaint........................................... 104
8.15 Indemnification...................................................... 104
8.16 Further Assurances................................................... 105
8.17 ERISA Requirement.................................................... 105
8.18 Continued Operations................................................. 105
8.19 Use of Proceeds...................................................... 106
8.20 New Subsidiaries..................................................... 106
ARTICLE IX
Negative Covenants
9.01 Asset Coverage Ratio................................................. 108
9.02 Net Worth............................................................ 108
9.03 Indebtedness to Total Capital........................................ 108
9.04 EBIT to Interest Expense. .......................................... 108
9.05 Lease Expense Ratio.................................................. 108
9.06 Indebtedness......................................................... 108
9.07 Liens................................................................ 109
9.08 Transfer of Assets................................................... 109
9.09 Investments........................ ................................. 110
9.10 Merger or Consolidation.............................................. 110
9.11 Transactions with Affiliates......................................... 111
9.12 ERISA................................................................ 111
9.13 Capital Expenditures................................................. 112
9.14 Fiscal Year.......................................................... 112
9.15 Rate Hedging Obligations............................................. 112
9.16 Acquisition.......................................................... 112
9.17 Transfer and Administration Agreement................................ 112
9.18 Existing TD France Subsidiaries...................................... 112
9.19 Lease-Backs.......................................................... 112
9.20 Dividends or Distributions........................................... 113
iii
<PAGE>
9.21 Negative Pledge....................................................... 113
ARTICLE X
Events of Default and Acceleration
10.01 Events of Default.................................................... 114
10.02 Agent to Act......................................................... 118
10.03 Cumulative Rights.................................................... 118
10.04 No Waiver............................................................ 118
10.05 Default.............................................................. 118
10.06 Allocation of Proceeds............................................... 118
ARTICLE XI
The Agents
11.01 Appointment.......................................................... 120
11.02 Attorneys-in-fact.................................................... 120
11.03 Limitation on Liability.............................................. 120
11.04 Reliance............................................................. 121
11.05 Notice of Default.................................................... 121
11.06 No Representations................................................... 121
11.07 Indemnification...................................................... 122
11.08 Lender............................................................... 122
11.09 Resignation.......................................................... 122
11.10 Sharing of Payments, etc............................................. 123
11.11 Fees................................................................. 124
ARTICLE XII
Miscellaneous
12.01 Assignments and Participations....................................... 125
12.02 Notices.............................................................. 127
12.03 No Waiver............................................................ 129
12.04 Setoff............................................................... 129
12.05 Survival............................................................. 129
12.06 Expenses............................................................. 130
12.07 Amendments........................................................... 130
12.08 Counterparts......................................................... 131
12.09 Waivers by Borrowers................................................. 132
12.10 Termination.......................................................... 132
12.11 Governing Law........................................................ 133
12.12 Representation and Warranty of the Lenders........................... 134
12.13 Indemnification...................................................... 134
12.14 Agreement Controls................................................... 135
12.15 Severability......................................................... 135
iv
<PAGE>
EXHIBIT A Lenders' Commitment and Applicable
Commitment Percentages......................................... 149
EXHIBIT B Form of Assignment and Acceptance.............................. 151
EXHIBIT C Notice of Appointment (or Revocation)
of Authorized Representative................................... 156
EXHIBIT D-1 Borrowing Notice (Loan)........................................ 157
EXHIBIT D-2 Borrowing Notice (Loan)........................................ 159
EXHIBIT D-3 Borrowing Notice (Domestic Acceptance)......................... 161
EXHIBIT E-1 Form of Competitive Bid Notes.................................. 163
EXHIBIT E-2 Form of Domestic Revolving Credit Notes........................ 167
EXHIBIT E-3 Form of Swing Line Note........................................ 170
EXHIBIT F General Acceptance Agreement
(Domestic Acceptance).......................................... 174
EXHIBIT G Form of Guaranty and Suretyship Agreement...................... 179
EXHIBIT H Competitive Bid Quote Request.................................. 186
EXHIBIT I Competitive Bid Quote.......................................... 187
EXHIBIT J Assumption and Consent Agreement............................... 189
EXHIBIT K-1 Opinion of Counsel for Borrower................................ 193
EXHIBIT K-2 Opinions of Guarantor's Counsel................................ 194
EXHIBIT L Form of Certificate............................................ 195
LIST OF SCHEDULES
Schedule 1.1 - Existing Canadian Acceptances
Schedule 1.2 - Existing Canadian Letters of Credit
Schedule 1.3 - Existing Domestic Acceptances
Schedule 1.4 - Existing Domestic Letters of Credit
Schedule 1.5 - Alternative Currency
Schedule 7.02(a) - Subsidiaries
Schedule 7.02(b) - Interest in Persons
Schedule 7.02(c) - Additional Indebtedness, Liabilities, etc.
Schedule 7.02(d) - Liens and Restrictions
Schedule 7.02(g) - Litigation
Schedule 9.06 - Existing Indebtedness
Schedule 9.21 - Negative Pledges
v
<PAGE>
REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT
THIS REVOLVING CREDIT AND REIMBURSEMENT AGREEMENT, dated as of May
23, 1996 (the "Agreement"), is made by and among:
TECH DATA CORPORATION, a corporation organized and existing under the
laws of the State of Florida and having its principal place of business located
in Clearwater, Florida ("TDC"); and
TECH DATA FRANCE, S.N.C., a societe en nom collectif organized under
the laws of France with a registered capital of FF 66,867,000, having its
registered office at 26 Avenue Henri Barbusse, 93000 Bobigny, registered with
the Registry of Commerce and of Companies of Bobigny under Number B 309 910 282
("TD France" and, together with TDC and any other Subsidiary who shall become
authorized to borrow under the Multicurrency Facilities in accordance with
Section 2.16 hereof, the "Multicurrency Facilities Borrowers"); and
TECH DATA CANADA INC., a corporation organized and existing under the
laws of Ontario, Canada, and having its principal place of business 6895
Columbus Road, Mississauga, Ontario L5T 269 ("TD Canada" and, together with the
Multicurrency Facilities Borrowers, the "Borrowers"); and
NATIONSBANK, NATIONAL ASSOCIATION ("NATIONSBANK"), CIBC INC., BARNETT
BANK OF PINELLAS COUNTY, NBD BANK, THE BANK OF NOVA SCOTIA, CREDIT LYONNAIS,
ROYAL BANK OF CANADA, PNC BANK, KENTUCKY, INC., SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION, FIRST UNION NATIONAL BANK OF FLORIDA and THE SAKURA BANK,
LIMITED, the initial lenders under the Multicurrency Facilities, and each other
lender which may hereafter execute and deliver an instrument of assignment with
respect to the Multicurrency Facilities under this Agreement pursuant to Section
12.01 (hereinafter NationsBank and such other lenders may be referred to
individually as a "Multicurrency Facilities Lender" or collectively as the
"Multicurrency Facilities Lenders"); and
CANADIAN IMPERIAL BANK OF COMMERCE ("CIBC") and THE BANK OF NOVA
SCOTIA, the initial lenders under the Canadian Facilities and each other lender
which may hereafter execute and deliver an instrument of assignment with respect
to the Canadian Facilities under this Agreement pursuant to Section 12.01
(hereafter CIBC and such other lenders may be referred to individually as a
"Canadian Facilities Lender" or collectively as the "Canadian Facilities
Lenders"; the Canadian Facilities Lenders and the Multicurrency Facilities
Lenders are sometimes referred to collectively as the "Lenders" or individually
as a "Lender");
NATIONSBANK, NATIONAL ASSOCIATION, a national banking association
organized and existing under the laws of the United States of America and having
its principal place of business in
<PAGE>
Tampa, Florida in its capacity as agent for the Lenders (in such
capacity, the "Agent"); and
CANADIAN IMPERIAL BANK OF COMMERCE in its capacity as agent for the
Canadian Facilities Lenders (the "Canadian Agent" and together with the Agent,
collectively the "Agents").
W I T N E S S E T H:
WHEREAS, TDC, the Agent and certain lenders are parties to an Amended
and Restated Revolving Credit and Reimbursement Agreement dated July 28, 1994,
as amended, (the "Prior Domestic Facilities Agreement") pursuant to which such
lenders have agreed to make loans to TDC and issue letters of credit and create
acceptances for the benefit of TDC in an aggregate amount of up to $125,000,000
(the "Prior Domestic Facilities"); and
WHEREAS, TD France, the Agent and certain lenders are parties to a
Revolving Foreign Currency Agreement dated as of August 4, 1994, as amended (the
"Prior TD France Facilities Agreement") pursuant to which such lenders have
agreed to make available to TD France a revolving credit facility in the
aggregate amount of up to $50,000,000 (the "Prior TD France Facility"); and
WHEREAS, TD Canada and CIBC are parties to a letter agreement dated
as of July 28, 1994 (the "Prior Canadian Facilities Agreement" and, together
with Prior Domestic Facilities Agreement and the Prior TD France Facilities
Agreement, the "Prior Credit Agreements") pursuant to which CIBC agreed to make
available to TD Canada revolving credit and foreign currency facilities and to
issue letters of credit and create acceptances for the benefit of TD Canada in
an aggregate amount of up to Cdn $33,000,000 (the "Prior TD Canada Facilities"
and, together with the Prior Domestic Facilities and the Prior TD France
Facility, the "Prior Credit Facilities"); and
WHEREAS, the Borrowers desire to replace the Prior Credit Facilities
with the Credit Facilities herein provided, and the Agents and the Lenders are
willing to make the Credit Facilities available to the Borrowers subject to the
terms and conditions herein provided;
NOW, THEREFORE, the Borrowers, the Lenders and the Agents hereby
agree as follows:
2
<PAGE>
ARTICLE I
Definitions and Terms
1.01 Definitions. For the purposes of this Agreement, in addition to
the definitions set forth above, the following terms shall have the respective
meanings set forth below:
"Absolute Rate" shall have the meaning assigned to such
term in Section 2.04(c)(ii)(C) hereof;
"Absolute Rate Auction" means a solicitation of Competitive
Bid Quotes setting forth Absolute Rates pursuant to Section 2.04
hereof;
"Absolute Rate Loans" means the Competitive Bid Loans the
interest rates on which are determined on the basis of Absolute Rates
set at Absolute Rate Auctions;
"Acceptance" means a Domestic Acceptance or a Canadian
Acceptance, as the case may be;
"Acceptance Addition" means that percent per annum set
forth below which percent shall be the Acceptance Addition effective
as to each Acceptance created next following the date of delivery of
the certificate described in Section 8.01(a)(iii) or Section
8.01(b)(ii) (the "Compliance Date") demonstrating that as of the end
of such period (i) either the ratio of Consolidated Funded
Indebtedness to Consolidated Total Capital is less than or equal to
or more than, as the case may be, or (ii) the ratio of Consolidated
EBIT to Consolidated Interest Expense is greater than or equal to or
less than, as the case may be, the applicable ratio set forth
opposite such Acceptance Addition (provided that if such
determination shall result in more than one Acceptance Addition, the
lower Acceptance Addition shall apply):
<TABLE>
<CAPTION>
Ratios
------
EBIT to Interest Debt to Capital Acceptance Addition
---------------- --------------- -------------------
<S> <C> <C> <C> <C>
(a) Less than 3.0 to 1.00 Less than .60 to 1.00 but .55%
equal to or greater than
.55 to 1.00
(b) Greater than or equal to Less than .55 to 1.00 but .45%
3.0 to 1.00 but less than equal to or greater than
4.0 to 1.00 .50 to 1.00
(c) Greater than or equal to Less than .50 to 1.00 but .40%
4.0 to 1.00 but less than equal to or greater than
5.0 to 1.00 .45 to 1.00
</TABLE>
3
<PAGE>
<TABLE>
<S> <C> <C> <C>
(d) Greater than or equal to Less than .45 to 1.00 .375%
5.0 to 1.00
</TABLE>
Notwithstanding the foregoing, if the Borrowers shall fail to deliver
any such certificate within the applicable period set forth in
Section 8.01(a) or (b), as the case may be, then the Acceptance
Addition shall be .55% until the appropriate certificate is
delivered. From the Closing Date to the first Compliance Date, the
Acceptance Addition shall be .45%;
"Acceptance Discount Proceeds" means:
(i) in the case of a Canadian Acceptance accepted by a Canadian
Facilities Lender that is a Schedule I Canadian chartered bank, the
discount proceeds received by it upon its sale of such Canadian
Acceptance to an arm's length purchaser; and
(ii) in the case of a Canadian Acceptance accepted by a Canadian
Facilities Lender that is not a Schedule I Canadian chartered bank,
the lesser of (a) the discount proceeds received by such Canadian
Facilities Lender upon its sale of such Canadian Acceptance to an
arm's length purchaser at approximately 10:00 a.m. Toronto time on
the drawdown day, or (b) the discount proceeds that would be received
by such Canadian Facilities Lender had it sold such Canadian
Acceptance based upon the average discount rate for bankers'
acceptances appearing on the CDOR screen of Reuters at approximately
10:00 a.m. Toronto time on the drawdown day in Section 3.01, or if
such rate is not quoted on the CDOR screen of Reuters at that time,
the discount proceeds that would be received by it if it were to sell
such Canadian Acceptance at a discount rate equal to the average
discount rate expressed as a rate per annum applicable to Acceptances
sold at that time by Canadian Facilities Lenders that are Schedule I
Canadian chartered banks plus 0.07% per annum;
"Advance" means a Canadian Advance or a Domestic Advance,
as the case may be;
"Advance Date Exchange Rate" means, (i) with respect to a
specified Advance or Loan of an Alternative Currency, the Spot Rate
of Exchange as of the date two Business Days preceding the date such
Advance is originally made, provided that, if such Advance or Loan is
continued for a subsequent Interest Period or converted pursuant to
Section 2.09 the Advance Date Exchange Rate with respect to such Loan
shall be the Spot Rate of Exchange two Business Days preceding the
effective date of the latest continuation or conversion of such
Advance or Loan; (ii) with respect to a specified Advance or Loan of
an Alternative Currency to TD Canada, the Advance Date Exchange Rate
shall be the Spot Rate of Exchange as of
4
<PAGE>
the date of the Advance or Loan or as of the date of a continued
Interest Period or conversion; and in either case the Dollar Value of
such Advance or Loan shall be adjusted as set forth in Section
2.01(b) or Section 3.01(b), as applicable; provided, further, that in
the case of a drawing under a Letter of Credit, the Spot Rate of
Exchange shall be as of the date of such drawing;
"Alternative Currency" means, (i) with respect to Loans
under the Domestic Revolving Credit Facility, those currencies listed
on Schedule 1.5 hereto and, with the prior written consent of all
Multicurrency Facilities Lenders and the Agent, any other lawful
currency other than Dollars which is freely transferable and
convertible into Dollars in the United States currency market;
provided, however, that an Alternative Currency shall only be
available to the Multicurrency Facilities Borrowers if each
Multicurrency Facilities Lender shall have access to such Alternative
Currency on terms reasonably acceptable to such Multicurrency
Facilities Lender and (ii) with respect to Loans under the Canadian
Revolving Credit Facility, Canadian Dollars;
"Alternative Currency Equivalent Amount" means, with
respect to a specified Alternative Currency and a specified Dollar
amount, the amount of such Alternative Currency into which such
Dollar amount would be converted, based on the applicable Advance
Date Exchange Rate;
"Alternative Currency Loan" means a Loan made in an
Alternative Currency;
"Applicable Agent" means, with respect to all matters
involving Article II of this Agreement the Agent, and with respect to
all matters involving Article III of this Agreement, the Canadian
Agent;
"Applicable Commitment Percentage" means, (i) for each
Multicurrency Facilities Lender, with respect to the Obligations
hereunder arising in connection with the Domestic Revolving Credit
Facilities (each a type of "credit exposure"), including its
Participations and its obligations hereunder to NationsBank to
acquire Participations, a fraction (expressed as a percentage), the
numerator of which shall be the then amount of such Multicurrency
Facilities Lender's Domestic Revolving Credit Commitment and the
denominator of which shall be the Total Domestic Revolving Credit
Commitment, which Applicable Commitment Percentage for each
Multicurrency Facilities Lender as of the Closing Date is as set
forth in Exhibit A attached hereto and incorporated herein by this
reference; (ii) for each Canadian Facilities Lender, with respect to
the Obligations hereunder arising in connection with the Canadian
Revolving Credit Facilities (each a type of "credit exposure"),
including its Participations and its
5
<PAGE>
obligations hereunder to CIBC to acquire Participations, a fraction
(expressed as a percentage), the numerator of which shall be the then
amount of such Canadian Facilities Lender's Canadian Revolving Credit
Commitment and the denominator of which shall be the Total Canadian
Revolving Credit Commitment, which Applicable Commitment Percentage
for each Canadian Facilities Lender as of the Closing Date is as set
forth in Exhibit A attached hereto and incorporated herein by this
reference; provided that the Applicable Commitment Percentage of each
Lender shall be increased or decreased to reflect any assignments to
or by such Lender effected in accordance with Section 12.01 hereof;
"Applicable Interest Addition" means that percent per annum
set forth below in the case of each of a Floating CD Loan, Fixed CD
Loan or Eurodollar Rate Loan, which percent shall be the Applicable
Interest Addition effective beginning on the first day next following
the date of delivery of the certificate described in Section
8.01(a)(iii) or Section 8.01(b)(iii) (the "Compliance Date")
demonstrating that as of the end of such period either (i) the ratio
of Consolidated Funded Indebtedness to Consolidated Total Capital is
less than or equal to or more than, as the case may be, or (ii) the
ratio of Consolidated EBIT to Consolidated Interest Expense is
greater than or equal to or less than, as the case may be, the
applicable ratio set forth opposite such Applicable Interest Addition
(provided that if such determination shall result in more than one
Applicable Interest Addition, the lower Applicable Interest Addition
shall apply):
<TABLE>
<CAPTION>
Ratios Interest Addition
------ -----------------
Floating Fixed Eurodollar
-------- ----- ----------
EBIT to Interest Debt to Capital CD Loan CD Loan Rate Loan
---------------- --------------- ------- ------- ---------
<S> <C> <C> <C> <C> <C>
(a) Less than 3.0 to 1.00 Less than .60 to 1.00 but .675% .675% .55%
equal to or greater than
.55 to 1.00
(b) Greater than or equal Less than .55 to 1.00 but .575% .575% .45%
to 3.0 to 1.00 but less equal to or greater than
than 4.0 to 1.00 .50 to 1.00
(c) Greater than or equal Less than .50 to 1.00 but .525% .525% .40%
to 4.0 to 1.00 but less equal to or greater than
than 5.0 to 1.00 .45 to 1.00
(d) Greater than or equal Less than .45 to 1.00 .500% .500% .375%
to 5.0 to 1.00
</TABLE>
Notwithstanding the foregoing, if the Borrowers shall fail to deliver
any such certificate within the applicable period set forth in
Section 8.01(a) or (b), as the case may be, then the Applicable
Interest Addition for any Loan shall be the highest
6
<PAGE>
Applicable Interest Addition for such type of Loan set forth above
until the appropriate certificate is so delivered. From the Closing
Date to the first Compliance Date, the Applicable Margin shall be
.575% for CD Loans and .45% for Eurodollar Rate Loans;
"Applicable Rate" means the Eurodollar Rate applicable to
any Alternative Currency;
"Applicable Reference Rate" means:
(i) for any Fixed CD Loan, in respect of the Interest
Period specified by the Authorized Representative in the
Borrowing Notice for such Fixed CD Loan, the per annum rate of
interest (expressed as a percentage and rounded upwards if
necessary to the nearest 1/100 of 1%) (which shall be the same
for each day of such Interest Period) determined in good faith
by the Agent in accordance with the usual procedures for its
customers generally (which determination shall be conclusive
absent manifest error) to be the average of the secondary market
bid rates at approximately 10:00 A.M. Charlotte, North Carolina
time on the first day of such Interest Period of at least two
dealers of recognized standing in negotiable certificates of
deposit for the purchase at face value of negotiable
certificates of deposit of major money center banks for delivery
on such day in an amount approximately equal to the principal
amount of, and for a period comparable to the Interest Period
for, such Fixed CD Loan and maturing at the end of such Interest
Period, and
(ii) for any Floating CD Loan the per annum rate of interest
(expressed as a percentage and rounded upwards if necessary to
the nearest 1/100 of 1%) determined in good faith by the Agent
in accordance with the usual procedures for its customers
generally to be the average of the secondary market bid rates at
approximately 10:00 A.M. Charlotte, North Carolina time on each
day of such Floating CD Loan of at least two dealers of
recognized standing in negotiable certificates of deposit for
the purchase at face value of negotiable certificates of deposit
of major money center banks for delivery on such day in an
amount approximately equal to the principal amount of such
Floating CD Loan for a period of 90 days, and
(iii) for any Eurodollar Rate Loan, in respect of the
Interest Period specified by the Authorized Representative in
the Borrowing Notice for such Eurodollar Rate Loan the average
(rounded upward to the nearest one-sixteenth (1/16th) of one
percent) per annum rate of interest determined by the office of
the Applicable Agent (each such determination to be conclusive
and binding) as of two Business Days prior to the first day of
such Interest
7
<PAGE>
Period, as the effective rate at which deposits in immediately
available funds in Dollars or an Alternative Currency, as the
case may be, are being, have been, or would be offered or quoted
by the Applicable Agent to major banks in the applicable
interbank market for Eurodollar deposits or deposits of such
Alternative Currency, as the case may be, at any time during the
Business Day which is the second Business Day immediately
preceding the first day of such Interest Period, for a term
comparable to such Interest Period and in the amount of the
Fixed Rate Loan. If no such offers or quotes are generally
available for such amount, the Applicable Agent shall be
entitled to determine the Eurodollar Rate by estimating in its
reasonable judgment the per annum rate (as described above) that
would be applicable if such quote or offers were generally
available;
"Applicable Reserve Requirement" means, for any CD Loan or any
Fixed Rate Loan (other than Competitive Bid Loans) with respect
thereto, the maximum aggregate rate at which reserves (including,
without limitation, any basic marginal, special, supplemental or
emergency reserves) are required to be maintained with respect
thereto under Regulation D of the Board or other applicable banking
regulator by the member banks of the Federal Reserve System against
(i) non-personal Dollar time deposits in an amount of $100,000 or
more in the case of any CD Loan or (ii) with respect to Eurocurrency
liabilities as that term is defined in Regulation D (or against any
other category of liabilities that includes deposits by reference to
which the interest rate of a Fixed Rate Loan is determined), whether
or not the applicable Lender has any Eurocurrency liabilities subject
to such reserve requirement at that time. A Fixed Rate Loan shall be
deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credit for
proration, exceptions or offsets that may be available from time to
time to the applicable Lender. The Fixed Rate shall be adjusted
automatically on and as of the effective date of any change in the
Applicable Reserve Requirement;
"Applicable Unused Fee" means that percent per annum set forth
below, which shall be the Applicable Unused Fee effective beginning
on the day next following the date of delivery of the certificate
described in Section 8.01(a)(iii) or Section 8.01(b)(iii) (the
"Compliance Date"), demonstrating that as of the end of such period
either (i) the ratio of Consolidated Funded Indebtedness to
Consolidated Total Capital is less than or equal to or more than, as
the case may be, or (ii) the ratio of Consolidated EBIT to
Consolidated Interest Expense is greater than or equal to or less
than, as the case may be, the applicable ratio set forth opposite
such Applicable Unused Fee (provided that if such determination
8
<PAGE>
shall result in more than one Applicable Unused Fee, the lower
Applicable Unused Fee shall apply:
<TABLE>
<CAPTION>
Ratios
------
EBIT to Interest Debt to Capital Applicable Unused Fee
---------------- --------------- ---------------------
<S> <C> <C> <C>
(a) Less than 3.0 to 1.00 Less than .60 to 1.00 but .175%
equal to or greater than
.55 to 1.00
(b) Greater than or equal to Less than .55 to 1.00 but .15%
3.0 to 1.00 but less than equal to or greater than
4.0 to 1.00 .50 to 1.00
(c) Greater than or equal to Less than .50 to 1.00 but .1375%
4.0 to 1.00 but less than equal to or greater than
5.0 to 1.00 .45 to 1.00
(d) Greater than or equal to Less than .45 to 1.00 .1250%
5.0 to 1.00
</TABLE>
Notwithstanding the foregoing, if the Borrowers shall fail to deliver
any such certificate within the applicable period set forth in
Section 8.01(a) or (b), as the case may be, then the Applicable
Unused Fee shall be .175% until the appropriate certificate is so
delivered. From the Closing Date to the first Compliance Date, the
Applicable Unused Fee shall be .15%;
"Assessment Rate" means, for any day for any CD Loan, the
rate per annum (rounded upward to the nearest 1/100 of 1%) determined
in good faith by the Agent in accordance with its usual procedures
for its customers generally (which determination shall be conclusive
absent manifest error) to be the net annual assessment rate payable
by the Agent on such day for insurance by the Federal Deposit
Insurance Corporation (or any successor) on Dollar time deposits. The
CD Rate shall be adjusted automatically as of the effective date of
each change in the Assessment Rate;
"Assignment and Acceptance" shall mean an Assignment and
Acceptance in the form of Exhibit B (with blanks appropriately filled
in) delivered to the Agent in connection with an assignment of a
Lender's interest under this Agreement pursuant to Section 12.01;
"Assumption and Consent Agreement" means each Assumption
and Consent Agreement described in Section 2.16 hereof executed and
delivered in connection with the creation of additional Multicurrency
Facilities Borrowers;
"Authorized Representative" means (i) in the case of TDC
any of the Chairman, Vice Chairman, President, Senior Vice
9
<PAGE>
Presidents of Finance and Chief Financial Officer or Treasurer of TDC
or, with respect to financial matters, the Treasurer or Chief
Financial Officer of TDC, (ii) in the case of TD France any of the
managing directors represented by their senior executive officers
(President, Senior Vice President or Chief Financial Officer), and
(iii) with respect to TD Canada, all of the Authorized
Representatives of TDC and the Vice President of Finance and
Controller, or any other person expressly designated by the Board of
Directors (or the appropriate committee thereof) of TDC as an
Authorized Representative for purposes of this Agreement, as set
forth from time to time in a certificate in the form attached hereto
as Exhibit C;
"BA Rate" means with respect to Domestic Acceptances,
NationsBank, N.A. Funds Management Bankers Acceptance Funding Rate as
established by the Agent from time to time for an Acceptance having
an Interest Period and in an approximate
amount equal to such Acceptance;
"Board" means the Board of Governors of the Federal
Reserve System (or any successor body);
"Borrowing Notice" means the telephonic request of the
Authorized Representative of a Borrower to (i) obtain an Advance or
to elect a subsequent Interest Period for or convert a Loan or Loans
of any type hereunder, as the obtaining of such Advance, such
election or conversion of such Loan or Loans shall be otherwise
permitted herein or (ii) create an Acceptance, as otherwise permitted
hereunder. Any Borrowing Notice shall be binding on and irrevocable
by the Borrower, and (a) in the case of a notice for the purposes set
forth in (i) hereof, shall be confirmed in writing within three (3)
Business Days by the Authorized Representative in the form attached
hereto as Exhibit D-1 for Domestic Revolving Loans or Exhibit D-2 for
Canadian Loans and (b) in the case of a notice for the purposes set
forth in (ii) hereof, shall be confirmed in writing not less than two
(2) Business Days prior to the creation of such Acceptance by an
Authorized Representative in the form attached hereto as Exhibit D-3
for Domestic Acceptances or Exhibit D-4 for Canadian Acceptances;
"Business Day" means (i) for all purposes other than as
covered by clauses (ii) and (iii) below, any day excluding Saturday,
Sunday and any day which is a legal holiday under the laws of the
States of New York, North Carolina or Florida or is a day on which
banking institutions located in such state are authorized or required
by law or other governmental action to close, (ii) with respect to
all notices, determinations, findings and payments in connection with
Canadian Loans, Canadian Letters of Credit and the Canadian
Acceptances, any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of Canada and the
10
<PAGE>
Province of Ontario, Canada or is a day on which banking institutions
located in such Province are authorized or required by law or other
governmental action to close and (iii) (A) with respect to all
notices, determinations, fundings and payments in connection with any
Eurodollar Rate Loan, any day that is a Business Day described in
clause (i) above and that is also a day for trading by and between
banks in Dollar deposits in the applicable interbank Eurodollar
market or in deposits in the applicable Alternative Currency in the
United States interbank market, as applicable, and (B) with respect
to all notices, determinations, findings and payments in connection
with any Canadian Loans, any day that is a Business Day described in
clause (ii) above and that is also a day for trading by and between
banks in Canadian Dollar deposits in the applicable interbank
Canadian Eurodollar market;
"Canadian Acceptance" means a draft which constitutes a
blank bill of exchange within the meaning of the Bills of Exchange
Act (Canada) drawn by TD Canada on, and accepted by, a Canadian
Facilities Lender and has a maturity 1, 2, 3 or 6 months after the
date such Acceptances was created and does not extend beyond the
Revolving Credit Termination Date, and shall include for purposes of
computation of Canadian Acceptance Usage the Existing Canadian
Acceptances;
"Canadian Acceptance Lender" means a Lender that is a
Canadian chartered bank;
"Canadian Acceptance Usage" means, as at any date of
determination, the aggregate face amount of all completed Canadian
Acceptances which have been accepted and discounted and not been
repaid by TD Canada whether or not due and whether or not held by
CIBC;
"Canadian Advance" means a borrowing under the Canadian
Revolving Credit Facility consisting of the aggregate
principal amount of a Domestic Base Rate Loan, Canadian Prime
Rate Loan or a Fixed Rate Loan;
"Canadian Dollars" or "Cdn $" means the lawful currency
of Canada;
"Canadian Facilities" means the revolving credit, letter of
credit and acceptance facilities made available by the Lenders
pursuant to Article III hereof;
"Canadian Letter of Credit" means a Letter of Credit issued
under the Canadian Letter of Credit Facility, and shall include for
purposes of computation of Canadian Letter of Credit Outstandings,
the Existing Canadian Letters of Credit and the related reimbursement
obligations;
11
<PAGE>
"Canadian Letter of Credit Commitment" means an amount
not to exceed Cdn $25,000,000;
"Canadian Letter of Credit Facility" means the facility
described in Article III hereof providing for the issuance by CIBC
for the account of TD Canada of Canadian Letters of Credit in an
aggregate stated amount at any time outstanding not exceeding the
Canadian Letter of Credit Commitment;
"Canadian Letter of Credit Outstandings" means all undrawn
amounts of Canadian Letters of Credit plus Reimbursement Obligations
relating to Canadian Letters of
Credit;
"Canadian Loans" means loans made by the Canadian
Facilities Lenders pursuant to Sections 3.01 hereof;
"Canadian Prime Rate" means on any day and with respect to
all Canadian Prime Rate Loans, the greater of:
(i) the variable rate of interest expressed as a
percentage per annum (calculated on the basis of a year of
365 days) which CIBC publishes as the reference rate of
interest in order to determine interest rates it will
charge on that day for demand loans in Canadian Dollars to
its Canadian customers and which it refers to as its "prime
lending rate" or "prime rate"; and
(ii) the average yield to maturity expressed as a
percentage per annum (calculated on the basis of a year of
365 days) quoted at 10:00 Toronto time on that day on the
CDOR page of Reuters for 30 day bankers' acceptances issued
by Canadian chartered banks, plus .50% per annum.
The Canadian Prime Rate is not necessarily intended to be the lowest
rate of interest determined by CIBC in connection with extensions of
credit in Canadian Dollars. Changes in the rate of interest on that
portion of any Loans maintained as Canadian Prime Rate Loans will
take effect simultaneously with each change in the Canadian Prime
Rate. The Canadian Agent shall give notice to the Borrower and each
Canadian Facilities Lender of the Canadian Prime Rate from time to
time quoted by CIBC and such notice shall be conclusive and binding
for all purposes absent error;
"Canadian Prime Rate Loan" or "Canadian Prime Loan" means a
Loan for which the rate of interest is determined by reference to the
Canadian Prime Rate;
"Canadian Revolving Credit Commitment" means with respect
to each Canadian Facilities Lender, the obligation of such Lender to
make Loans to TD Canada up to an aggregate principal amount at any
one time outstanding equal to the percentage set
12
<PAGE>
forth in Exhibit A as the same may be increased or decreased
from time to time pursuant to this Agreement;
"Canadian Revolving Credit Facility" means the facility
described in Article III hereof providing for Loans to TD Canada by
the Canadian Facilities Lenders in the aggregate principal amount of
Total Canadian Revolving Credit Commitment less the aggregate amount
of Canadian Letter of Credit Outstandings and Canadian Acceptance
Usage;
"Capital Expenditures" means for any period the sum of (i)
the gross amount of additions to property, plant and equipment of TDC
and its Subsidiaries during such period plus (ii) with respect to any
Capital Lease entered into by TDC or any Subsidiary during such
period, the present value of the lease payments due under such
Capital Lease over the term of such Capital Lease applying a discount
rate equal to the interest rate provided in such lease or if no
interest is provided, the interest rate used in the preparation of
the financial statements referred to in Section 8.01(a) or (b)
hereof;
"Capital Leases" means all leases which have been or should
be capitalized in accordance with Generally Accepted Accounting
Principles as in effect from time to time including Statement No. 13
of the Financial Accounting Standards Board and any successor
thereof;
"Cash Equivalents" means
(a) marketable obligations issued or
unconditionally guaranteed by the United States government,
in each case maturing within one year after the date of
acquisition thereof;
(b) marketable direct obligations issued by any
state of the United States or any political subdivision of
any such state maturing within 180 days after the date of
acquisition thereof and, at the time of acquisition, having
a rating of A-1 or P-1, or better, from Standard & Poor's
division of McGraw-Hill, Inc. ("Standard & Poor's") or
Moody's Investors Service, Inc., respectively;
(c) commercial paper maturing no more than 270
days after the date of acquisition thereof, issued by a
corporation organized under the laws of any state of the
United States or of the District of Columbia and, at the
time of acquisition, having a rating of A-1 or P-1, or
better, from Standard & Poor's or Moody's Investors
Service, Inc., respectively;
13
<PAGE>
(d) time deposits, certificates of deposit or
Eurodollar deposit maturing within 90 days after the date
of acquisition thereof, issued by any commercial bank that
is either (i) a member of the Federal Reserve System that
has capital, surplus and undivided profits (as shown on its
most recent statement of condition) aggregating not less
than $400,000,000 and is rated A or better by Moody's
Investors Service, Inc. or Standard & Poor's or (ii) a
Lender;
(e) repurchase agreements entered into with any
Lender or any commercial bank of the nature referred to in
clause (d), secured by a fully perfected Lien in any
obligation of the type described in any of clauses (a)
through (d), having a fair market value at the time such
repurchase agreement is entered into of not less than 100%
of the repurchase obligation thereunder of such Lender or
other commercial bank; and
(f) money market funds not less than 75% of whose
investments are made up of securities described in
clauses (a) through (e);
"CD Loan" means a Loan for which the rate of interest is
determined by reference to the CD Rate;
"CD Rate" means, for any CD Loan, the rate of interest per
annum determined pursuant to the following formula:
Applicable Reference Rate
CD Rate = -------------------------+ Assessment Rate + Applicable
1 - Applicable Interest
Reserve Requirement Addition
"Change of Control" means, at any time:
(A) with respect to TDC:
(i) any "person" or "group" (each as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange
Act) either (A) becomes the "beneficial owner"
(as defined in Rule 13d-3 of the Exchange Act ),
directly or indirectly, of Voting Stock of TDC
(or securities convertible into or exchangeable
for such Voting Stock) representing 30% or more
of the combined voting power of all Voting Stock
of TDC (on a fully diluted basis) or (B)
otherwise has the ability, directly or
indirectly, to elect a majority of the board of
directors of TDC; or
(ii) during any period of up to 24
consecutive months, commencing on the Closing
Date, individuals who at the beginning of such
24-month period were directors of TDC shall cease
for any reason (other
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than the death, disability or retirement) to
constitute a majority of the board of directors of
TDC; or
(iii) any Person or two or more Persons acting
in concert shall have acquired by contract or
otherwise, or shall have entered into a contract
or arrangement that, upon consummation thereof,
will result in its or their acquisition of the
power to exercise, directly or indirectly, a
controlling influence on the management or
policies of TDC; and
(B) with respect to any Significant Subsidiary of
TDC:
(i) which is or becomes a wholly-owned
Significant Subsidiary at or after the Closing
Date, such Person ceases for any reason to be a
wholly-owned Subsidiary of TDC (or with respect
to TD Canada or TD France, ceases to be a
significant subsidiary); or
(ii) which is or becomes a Significant
Subsidiary (other than a wholly-owned Significant
Subsidiary) of TDC at or after the Closing Date,
such Person ceases for any reason to be a
Subsidiary of TDC;
"Closing Date" means the date as of which this Agreement is
executed by the Borrowers, the Lenders and the Agent and on which the
conditions set forth in Section 5.01 hereof have been satisfied;
"Commercial Letter of Credit" means a documentary letter of
credit issued (i) in the case of Domestic Letters of Credit, by
NationsBank for the account of the applicable Multicurrency
Facilities Borrower or (ii) in the case of Canadian Letters of
Credit, by CIBC for the account of TD Canada, to support the
acquisition of Eligible Inventory (x) in the case of Domestic Letters
of Credit, of Multicurrency Facilities Borrowers and (y) in the case
of Canadian Letters of Credit, of TD Canada which letters of credit
are secured by documents; provided that the expiry date of a
Commercial Letter of Credit (i) shall not be later than six (6)
months subsequent to the date of issuance thereof, (ii) shall not
provide for payment subsequent to the thirtieth Business Day
preceding the Revolving Credit Termination Date and (iii) shall not
provide for time drafts;
"Competitive Bid Borrowing" shall have the meaning
assigned to such term in Section 2.04(b) hereof;
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"Competitive Bid Loans" means the Loans provided for by
Section 2.04 hereof;
"Competitive Bid Notes" means the promissory notes of the
Multicurrency Facilities Borrowers executed and delivered to the
Multicurrency Facilities Lenders as provided in Section 2.05(c) and
Section 2.16 substantially in the form of Exhibit E-1 which shall be
delivered to evidence the Competitive Bid Loans;
"Competitive Bid Quote" means an offer in accordance with
Section 2.04(c) hereof by a Lender to make a Competitive Bid Loan
with one single specified interest rate;
"Competitive Bid Quote Request" shall have the meaning
assigned to such term in Section 2.04(b) hereof;
"Consistent Basis" in reference to the application of
Generally Accepted Accounting Principles means the accounting
principles observed in the period referred to are comparable in all
material respects to those applied in the preparation of the audited
financial statements of TDC referred to in
Section 7.02(c)(i) hereof;
"Consolidated Asset Coverage Ratio" means the ratio of (A)
the sum of, without duplication, (i) unrestricted cash and Cash
Equivalents located in each case within the United States, (ii)
Remaining Accounts Receivable, (iii) Receivables of Subsidiaries,
(iv) Inventory and (v) Prepaid Inventory to (B) the sum of, without
duplication, (i) Total Domestic Utilization, (ii) Total Canadian
Utilization, (iii) Indebtedness permitted under Section 9.06(v), and
(iv) accounts payable of TDC and its Subsidiaries, all determined on
a consolidated basis in accordance with Generally Accepted Accounting
Principals applied on a Consistent Basis;
"Consolidated EBIT" means, with respect to TDC and its
Subsidiaries for the Four-Quarter Period immediately preceding the
date of computation thereof, the sum of, without duplication, (i)
Consolidated Net Income, plus (ii) Consolidated Interest Expense
during such period, (iii) plus taxes paid on income during such
period, all determined on a consolidated basis in accordance with
Generally Accepted Accounting Principles applied on a Consistent
Basis;
"Consolidated Funded Indebtedness" means Indebtedness for
Money Borrowed of TDC and its Subsidiaries, all determined on
a consolidated basis;
"Consolidated Indebtedness" means all Indebtedness of TDC
and its Subsidiaries, all determined on a consolidated basis;
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"Consolidated Interest Expense" means, with respect to any
period of computation thereof, the gross interest expense of TDC and
its Subsidiaries, including without limitation (i) the amortization
of debt discounts, (ii) the amortization of all reserves and fees
(including without limitation, dealer and program fees payable under
the Transfer and Administration Agreement and fees payable in respect
of a Swap Agreement) payable in connection with the incurrence of
Indebtedness to the extent included in interest expense and (iii) the
portion of any liabilities incurred in connection with Capital Leases
allocable to interest expense, all determined on a consolidated basis
in accordance with Generally Accepted Accounting Principles applied
on a Consistent Basis;
"Consolidated Lease Expense" means with respect to TDC and
its Subsidiaries for the Four Quarter Period immediately preceding
the date of computation, the gross amount of all lease or rental
expense, whether or not characterized as rent, excluding payments in
respect of Capital Leases constituting Indebtedness, all determined
in accordance with Generally Accepted Accounting Principles applied
on a Consistent Basis;
"Consolidated Net Income" means the gross revenues of TDC
and its Subsidiaries less all operating and non-operating expenses of
TDC and its Subsidiaries including taxes on income, all determined in
accordance with Generally Accepted Accounting Principles applied on a
Consistent Basis; but excluding as income: (i) gains on the sale,
conversion or other disposition of capital assets, (ii) gains on the
acquisition, retirement, sale or other disposition of capital stock
and other securities of TDC or any Subsidiary, (iii) gains on the
collection of proceeds of life insurance policies, (iv) any write-up
of any asset, and (v) any other gain or credit of an extraordinary
nature as determined in accordance with Generally Accepted Accounting
Principles applied on a Consistent Basis;
"Consolidated Shareholders' Equity" means at any time as of
which the amount thereof is to be determined, the sum of the
following in respect of TDC and its Subsidiaries (determined on a
consolidated basis and excluding intercompany items among TDC and its
Subsidiaries and any upward adjustment after the Closing Date due to
revaluation of assets): (i) the amount of issued and outstanding
share capital, plus (ii) the amount of additional paid-in capital and
retained income (or, in the case of a deficit, minus the amount of
such deficit), plus (iii) the amount of any foreign currency
translation adjustment (if positive, or, if negative, minus the
amount of such translation adjustment) minus (iv) the absolute value
of any treasury stock and the absolute value of any stock
subscription receivables, as determined in accordance with Generally
Accepted Accounting Principles applied on a Consistent Basis;
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"Consolidated Tangible Net Worth" means at any time as of
which the amount thereof is to be determined, Consolidated
Shareholders' Equity minus the sum of the following (without
duplication of deductions in respect of items already deducted in
arriving at surplus and retained earnings): (a) the net book value of
all assets which would be treated as intangible assets under
Generally Accepted Accounting Principles, such as (without
limitation) goodwill (whether representing the excess of cost over
book value of assets acquired or otherwise), capitalized expenses
(other than capitalized software expenses), unamortized debt discount
and expense, consignment inventory (to the extent not included in
Inventory of the Borrower and its Subsidiaries under Generally
Accepted Accounting Principles), patents, trademarks, trade names,
copyrights, franchises and licenses; and (b) all reserves (other than
contingent reserves not allocated to any particular purpose),
including without limitation reserves for depreciation, depletion,
amortization, obsolescence, deferred income taxes, insurance and
inventory valuation;
"Consolidated Total Capital" means the sum of
Consolidated Shareholders' Equity and Consolidated Funded
Indebtedness;
"Contingent Obligation" of any Person means all contingent
liabilities required (or which, upon the creation or incurring
thereof, would be required) to be included in the consolidated
financial statements (including footnotes) of such Person in
accordance with Generally Accepted Accounting Principles applied on a
Consistent Basis, including Statement No. 5 of the Financial
Accounting Standards Board, and any obligation of such Person
guaranteeing or in effect guaranteeing any Indebtedness, dividend or
other obligation of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including obligations of such
Person however incurred:
(1) to purchase such Indebtedness or other
obligation or any property or assets constituting
security therefor;
(2) to advance or supply funds in any manner (i)
for the purchase or payment of such Indebtedness or other
obligation, or (ii) to maintain a minimum working capital,
net worth or other balance sheet condition or any income
statement condition of the primary obligor;
(3) to grant or convey any lien, security
interest, pledge, charge or other encumbrance on any
property or assets of such Person to secure payment of such
Indebtedness or other obligation;
18
<PAGE>
(4) to lease property or to purchase securities
or other property or services primarily for the purpose of
assuring the owner or holder of such Indebtedness or
obligation of the ability of the primary obligor to make
payment of such Indebtedness or other obligation; or
(5) otherwise to assure the owner of the
Indebtedness or such obligation of the primary obligor
against loss in respect thereof;
With respect to Contingent Obligations (such as litigation,
guarantees and pension plan liabilities), such liabilities shall be
computed at the amount which, in light of all the facts and
circumstances existing at the time, represent the amount which can
reasonably be expected to become an actual or matured liability;
"Cost of Acquisition" means the sum of (i) the market
value, as at the date of entering into any agreement to acquire any
Person, of the assets and/or the capital stock or warrant or option
to be transferred in connection therewith, (ii) any cash or face
amount of any debt instrument given as consideration, and (iii) any
Indebtedness or liabilities assumed (or taken subject to) by TDC or
its Subsidiaries in connection with such acquisition;
"Credit Margin" means, for any day, with respect to any
Canadian Acceptance accepted under the Canadian Revolving Commitment
the amount set out as the Applicable Interest Addition used for
determining the Eurodollar Rate;
"Default" means any event or condition which, with the
giving or receipt of notice or lapse of time or both, would
constitute an Event of Default hereunder;
"Defaulted Receivable" means any Receivable which is at the
time of transfer to Enterprise pursuant to the Transfer and
Administration Agreement either (i) unpaid for 91 days or more from
the original due date, (ii) as to which an event of bankruptcy has
occurred with respect to the obligor thereunder, (iii) is deemed
uncollectible by TDC, or (iv) consistent with TDC's credit and
collection policy should be written off as uncollectible;
"Dollar Equivalent Amount" means, with respect to a
specified Alternative Currency amount, the amount of Dollars into
which an Alternative Currency amount would be converted, based on the
applicable Advance Date Exchange Rate;
"Dollar Value" of an Advance or a Loan in an Alternative
Currency means the Dollar Equivalent Amount of the principal amount
of such Advance or Loan with respect to such Advance or
19
<PAGE>
Loan, as recorded in the Agent's records pursuant to Section
2.01(b) and Section 3.01(b);
"Dollars" and the symbol "$" means dollars constituting
legal tender for the payment of public and private debts in the
United States of America;
"Domestic Acceptance" means a draft drawn by TDC on, and
accepted by, a financial institution, which Acceptance is eligible
for discount by Federal Reserve Banks pursuant to paragraph 7 of
Section 13 of the Federal Reserve Act (12 U.S.C. ss.372), as amended
from time to time and has a maturity date of 30, 60, 90 or 180 days
after the date such Acceptance was created and does not extend beyond
the Revolving Credit Termination Date, and shall include for purposes
of computation of Domestic Acceptance Usage the Existing Domestic
Acceptances;
"Domestic Acceptance Date" means that date upon which
NationsBank creates a Domestic Acceptance pursuant to Article II
hereof;
"Domestic Acceptance Usage" means, as at any date of
determination, the aggregate face amount of all completed Domestic
Acceptances which have not been repaid by the Multicurrency
Facilities Borrowers whether or not due and whether or not held by
NationsBank;
"Domestic Advance" means a borrowing under (i) the Domestic
Revolving Credit Facility consisting of the aggregate principal
amount of a Domestic Base Rate Loan or Fixed Rate Loan, as the case
may be and (ii) the Swing Line consisting of Floating CD Loans;
"Domestic Base Rate" means on any day the per annum rate of
interest equal to (A) for Loans in Article II hereof the greater of
(i) the Domestic Prime Rate or (ii) the Federal Funds Effective Rate
plus one-half of one percent (1/2%). Any change in the Domestic Base
Rate resulting from a change in the Domestic Prime Rate or the
Federal Funds Effective Rate shall become effective as of 12:01 A.M.
of the Business Day on which each such change occurs. The Domestic
Base Rate is a reference rate used by Agent in determining interest
rates on certain loans and is not intended to be the lowest rate of
interest charged on any extension of credit to any debtor and (B) for
Canadian Loans in Article III hereof made by Canadian Facilities
Lenders a fluctuating rate of interest per annum (expressed on the
basis of a year of 365 days) equal to the higher of:
(a) the rate of interest most recently established
by CIBC as its base rate for Dollar loans made in Canada;
and
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<PAGE>
(b) the Federal Funds Effective Rate in effect on each
day as determined by the Agent plus 1/2 of 1%.
The Domestic Base Rate is not necessarily intended to be the lowest
rate of interest determined by CIBC in connection with extensions of
credit in Dollars. Changes in the rate of interest on that portion of
any Canadian Loans maintained as Domestic Base Rate Loans will take
effect simultaneously with each change in the Domestic Base Rate. The
Canadian Agent will give notice promptly to TD Canada and the
Canadian Facilities Lenders of changes in the Domestic Base Rate;
"Domestic Base Rate Loan" means a Loan for which the rate
of interest is determined by reference to the Domestic Base Rate;
"Domestic Borrowers' Account" means a demand deposit
account with the Agent, which may be maintained at one or more
offices of the Agent, or an agent for the Agent;
"Domestic Letter of Credit" means a Letter of Credit issued
under the Domestic Letter of Credit Facility, and shall include for
purposes of computation of Domestic Letter of Credit Outstandings,
the Existing Domestic Letters of Credit and the related reimbursement
obligations;
"Domestic Letter of Credit Commitment" means an amount
not to exceed $75,000,000;
"Domestic Letter of Credit Facility" means the facility
described in Article II hereof providing for the issuance by
NationsBank for the account of the Multicurrency Facilities Borrowers
of Letters of Credit in an aggregate stated amount at any time
outstanding not exceeding the Domestic Letter of Credit Commitment;
"Domestic Letter of Credit Outstandings" means all undrawn
amounts of Domestic Letters of Credit plus Reimbursement Obligations
relating to Domestic Letters of
Credit;
"Domestic Loans" means Loans made by the Multicurrency
Facilities Lenders pursuant to Sections 2.01, 2.04 and 2.15 hereof;
"Domestic Prime Rate" means the per annum rate of interest
announced publicly by the Agent as its prime rate from time to time.
The Domestic Prime Rate is not necessarily the best or the lowest
rate of interest offered by the Agent;
"Domestic Revolving Credit Commitment" means with respect
to each Domestic Lender, the obligation of such Lender to make Loans
to the Domestic Facility Borrowers up to an aggregate
21
<PAGE>
principal amount at any one time outstanding equal to the percentage
set forth in Exhibit A as the same may be increased or decreased from
time to time pursuant to this Agreement;
"Domestic Revolving Credit Facility" means the facility
described in Article II hereof providing for Loans to the Domestic
Borrowers by the Domestic Lenders in the aggregate principal amount
of the Total Domestic Revolving Credit Commitment less the aggregate
amount of outstanding Swing Line Loans, Domestic Letters of Credit
Outstandings and Domestic Acceptances Usage;
"Domestic Revolving Credit Notes" means the promissory
notes of the Multicurrency Facilities Borrowers executed and
delivered to the Multicurrency Facilities Lenders as provided in
Section 2.05(a) and Section 2.16 hereof in substantially the form
attached as Exhibit E-2, with appropriate insertions as to amounts,
dates and names of Multicurrency Facilities Lenders, which Domestic
Revolving Credit Notes shall be delivered to evidence the Domestic
Revolving Loans provided for herein;
"Domestic Revolving Loan" means Loans made by the
Multicurrency Facilities Lenders to the Multicurrency
Facilities Borrowers pursuant to Section 2.01 hereof;
"Domestic Subsidiary" means a Subsidiary of TDC which is
organized under the laws of the United States, Federal or state, or
any territory or instrumentality thereof;
"Eligible Receivables" means, at any time, any
Receivable:
(i) which has been sold by TDC to TDF pursuant to a
purchase agreement and to which TDF has good title thereto,
free and clear of all Liens, other than a Lien in favor of
Enterprise;
(ii) the obligor of which is a United States resident,
is not a Person affiliated with Borrower or TDF, has not
been excluded as an obligor by Enterprise and is not a
government or a governmental subdivision or agency;
(iii) which is not a Defaulted Receivable;
(iv) which has not remained unpaid for more than 60
days from the original due date;
(v) which, according to the contract, purchase order
or other agreement giving rise thereto is required to be
paid in full within 60 days of the original billing date
thereof;
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(vi) which is an "eligible asset" as defined in Rule
3a-7 under the Investment Company Act of 1940, as
amended;
(vii) a purchase of which with the proceeds of
commercial paper would constitute a "current transaction"
within the meaning of Section 3(a)(3) of the Securities Act
of 1933, as amended;
(viii) which is an "account" within the meaning of
Article 9 of the Uniform Commercial Code of all
applicable jurisdictions;
(ix) which is denominated and payable only in United
States dollars in the United States;
(x) which arises under a contract, purchase order or
other agreement that together with the Receivable related
thereto, is in full force and effect and constitutes the
legal, valid and binding obligation of the related obligor
enforceable against such obligor in accordance with its
terms and, to the best knowledge of TDC or TDF is not
subject to any offset, counterclaim or other defense at
such time;
(xi) which, together with the contract, purchase order
or other agreement related thereto, does not contravene in
any material respect any laws, rules or regulations
applicable thereto (including, without limitation, laws,
rules and regulations relating to truth in lending, fair
credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices and privacy)
and with respect to which no part of the contract, purchase
order or other agreement related thereto is in violation of
any such law, rule or regulation in any material respect;
(xii) which (A) satisfies in all material respects
all applicable requirements of the applicable credit and
collection policy of TDC and (B) is assignable;
(xiii) which was generated in the ordinary course of
TDC's business; and
(xiv) the obligor of which has been directed to make
all payments to a specified account of TDF;
"Enterprise" means Enterprise Funding Corporation, a
Delaware corporation;
"Environmental Laws" means, collectively, the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, the Superfund Amendments
23
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and Reauthorization Act of 1986, the Resource Conservation and
Recovery Act, the Toxic Substances Control Act, as amended, the Clean
Air Act, as amended, the Clean Water Act, as amended, any other
"Superfund" or "Superlien" law or any other federal, or applicable
state or local statute, law, ordinance, code, rule, regulation, order
or decree regulating, relating to, or imposing liability or standards
of conduct concerning, any hazardous, toxic or dangerous waste,
substance or material, as now or at any time hereafter in effect;
"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;
"Eurodollar Rate" means, for the Interest Period for any
Eurodollar Rate Loan, the rate of interest per annum determined
pursuant to the following formula:
Eurodollar Applicable Reference Rate Applicable Interest
= -------------------------- +
Rate 1 - Applicable Reserve Requirement Addition
"Eurodollar Rate Loan" means a Loan (including a Loan in an
Alternative Currency) for which the rate of interest is determined by
reference to the Eurodollar Rate;
"Event of Default" means any of the occurrences set forth
as such in Section 10.01 hereof and the expiration of any applicable
notice or cure period;
"Existing Canadian Acceptances" means acceptances
outstanding under the Prior TD Canada Facilities as of the Closing
Date, more particularly described on Schedule 1-1 hereto;
"Existing Canadian Letters of Credit" means standby and
commercial letters of credit outstanding under the Prior TD Canada
Facilities as of the Closing Date, more particularly described on
Schedule 1-2;
"Existing Domestic Acceptances" means acceptances
outstanding under either the Prior Domestic Facilities or the Prior
TD France Facility as of the Closing Date, more particularly
described on Schedule 1-3 hereto;
"Existing Domestic Letters of Credit" means standby and
commercial letters of credit outstanding under either the Prior
Domestic Facilities or the Prior TD France Facility as of the Closing
Date, more particularly described on Schedule 1-4;
"Existing TD France Subsidiaries" means the Subsidiaries
of TD France listed on Schedule 7.02(a);
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"Federal Funds Effective Rate" for any day, as used herein,
means the rate per annum (rounded upward to the nearest 1/100 of 1%)
announced by the Federal Reserve Bank of New York (or any successor)
on such day as being the weighted average of the rates on overnight
Federal funds transactions arranged by Federal funds brokers on the
previous trading day, as computed and announced by such Federal
Reserve Bank (or any successor) in substantially the same manner as
such Federal Reserve Bank computes and announces the weighted average
it refers to as the "Federal Funds Effective Rate" as of the date of
this Agreement; provided, if such Federal Reserve Bank (or its
successor) does not announce such rate on any day, the "Federal Funds
Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced;
"Fiscal Year" means the 12 month period of TDC ending on
January 31 of each calendar year and commencing on February 1 of each
calendar year;
"Fixed CD Loan" means a CD Loan for which a Multicurrency
Facilities Borrower elects an Interest Period of 30, 60, 90 or 180
days pursuant to Section 2.01(b)(iii) hereof;
"Fixed Rate Loan" means a Loan which is either a Fixed CD
Loan, a Eurodollar Rate Loan or a Competitive Bid Loan;
"Floating CD Loan" means a CD Loan other than a Fixed CD
Loan;
"Floating Rate Loan" means a Loan in Dollars which is a
Domestic Base Rate Loan or a Floating CD Loan;
"Foreign Benefit Law" means any applicable statute, law,
ordinance, code, rule, regulation, order or decree of any foreign
nation or any province, state, territory, protectorate or other
political subdivision thereof regulating, relating to, or imposing
liability or standards of conduct concerning any pension, retirement,
healthcare, death, disability or other employee benefit plan;
"Four-Quarter Period" means a period of four full
consecutive fiscal quarters of TDC and its Subsidiaries, taken
together as one accounting period;
"Funding Bank" means any banking institution approved by
the Agent located within a country which country's currency
constitutes an Alternative Currency and, with respect to Canadian
Dollars to be made available to TD Canada under the Canadian
Revolving Credit Facility, the Canadian Agent;
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"General Acceptance Agreement" means the General
Acceptance Agreements in the form attached hereto and marked
as Exhibit F;
"Generally Accepted Accounting Principles" means those
principles of accounting set forth in pronouncements of the Financial
Accounting Standards Board, the American Institute of Certified
Public Accountants or which have other substantial authoritative
support and are applicable in the circumstances as of the date of a
report, as such principles are from time to time supplemented and
amended;
"Guaranty" means, collectively or individually, as the
context may require, (i) the unconditional Guaranty and Suretyship
Agreement in favor of the Multicurrency Facilities Lenders in the
form attached hereto as Exhibit G-1 delivered to the Agent in
accordance with Article V hereof or pursuant to Section 8.20 hereof
pursuant to which the Significant Subsidiaries other than TD France
guarantee the payment and performance of all obligations to the
Multicurrency Facilities Lenders as more specifically set forth in
such Guaranty, and (ii) the unconditional Guaranty and Suretyship
Agreement in favor of the Canadian Facilities Lenders in the form
attached hereto as Exhibit G-2 delivered to the Agent in accordance
with Article V hereof pursuant to which TDC and its Significant
Subsidiaries (other than TD Canada) guarantees the payment and
performance of all obligations to the Canadian Facilities Lenders as
more specifically set forth in such Guaranty;
"Hazardous Material" means and includes any hazardous,
toxic or dangerous waste, substance or material, the generation,
handling, storage, disposal, treatment or emission of which is
subject to any Environmental Law in effect on any date;
"Indebtedness" means with respect to any Person, all
Indebtedness for Money Borrowed, all indebtedness of such Person for
the acquisition of property, other than purchases of products and
merchandise in the ordinary course of business so long as payment
therefor is due within one year, indebtedness secured by any Lien on
the property of such Person whether or not such indebtedness is
assumed, all liability of such Person by way of endorsements (other
than for collection or deposit in the ordinary course of business);
all Contingent Obligations; all Capital Leases and other items which
in accordance with Generally Accepted Accounting Principles are
classified as liabilities on a balance sheet; provided that in no
event shall the term Indebtedness include the TDC TROL, capital
stock, surplus and retained earnings, minority interest in the common
stock of Subsidiaries, lease obligations (other than pursuant to
Capital Leases), reserves for deferred income taxes and investment
credits, other
26
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deferred credits and reserves, and deferred compensation
obligations;
"Indebtedness for Money Borrowed" means, for any Person,
(i) all indebtedness, obligations and liabilities of such Person for
money borrowed which are evidenced by bonds, debentures, notes or
other similar instruments, (ii) the purchase price of Eligible
Receivables sold pursuant to the Trade Receivables Purchase Facility
and (iii) all Capital Leases which have been capitalized in
accordance with Generally Accepted Accounting Principles; provided,
however, the term "Indebtedness for Money Borrowed" shall
specifically exclude payroll indebtedness and trade indebtedness
incurred in the ordinary course of business (including trade
indebtedness through financial intermediaries) provided such trade
indebtedness has a maturity of less than one year;
"Interest Period" for each Fixed Rate Loan or Acceptance
means a period commencing on the date such Fixed Rate Loan is made or
converted or such Acceptance is created and each subsequent period
commencing on the last day of the immediately preceding Interest
Period for such Fixed Rate Loan or Acceptance, as the case may be,
and ending, at the Borrower's option, (A) for any Fixed CD Loan or
Acceptance, on the date 30, 60, 90 or 180 days thereafter as notified
to the Applicable Agent by the Authorized Representative of such
Borrower two (2) Business Days prior to the beginning of such
Interest Period and (B) for any Eurodollar Rate Loan, on the date
one, two, three or six months thereafter as notified to the Agent by
the Authorized Representative of such Borrower three (3) Business
Days prior to the beginning of such Interest Period in the case of a
Eurodollar Rate Loan and five (5) Business Days prior to the
beginning of such Interest Period in the case of a Loan in an
Alternative Currency other than Canadian Dollars or French Francs;
provided, that,
(i) if the Authorized Representative fails to notify
the Applicable Agent of the length of an Interest Period
for any Fixed CD Loan two (2) Business Days or for any
Eurodollar Rate Loan three (3) or five (5) (as the case may
be) Business Days, as the case may be, prior to the first
day of such Interest Period, the Loan for which such
Interest Period was to be determined shall be deemed to be
a Floating Rate Loan as of the first day thereof;
(ii) if an Interest Period for a Fixed Rate Loan or
Acceptance would end on a day which is not a Business Day,
such Interest Period shall be extended to the next Business
Day (unless in the case of any Eurodollar Rate Loan, such
extension would cause the applicable Interest Period to end
in the succeeding calendar month, in which case such
Interest Period shall end on the next preceding Business
Day);
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(iii) excluding Interest Periods for Acceptances, there
shall not be more than (x) twelve (12) Interest Periods in
effect on any day in respect of Domestic Loans and (y) four
(4) Interest Periods in effect on any day in respect of
Canadian Loans;
(iv) Interest Periods shall be of such duration as
to permit the Borrowers to make the reductions or
repayments required by this Agreement;
(v) there shall not be in effect at any one time
more than an aggregate of four (4) Canadian Acceptances
with different maturity dates;
(vi) the first Interest Period for a Eurodollar Rate
Loan shall commence on the day such Canadian Loan is
advanced by the Canadian Facilities Lenders and each
subsequent Interest Period relative thereto shall commence
forthwith upon the expiry of the immediately preceding
Interest Period relative thereto; and
(vii) if any Interest Period is extended or shortened by
the application of clause (vi) above, the following
Interest Period shall (without prejudice to the application
of clause (vi) above) end on the day on which it would have
ended if the immediately preceding Interest Period had not
been so extended or shortened.
"Inventory" means and includes any and all goods,
merchandise and other personal property, including, without
limitation, goods in transit, wheresoever located and whether now
owned or hereafter acquired by TDC and its Subsidiaries which is or
may at any time be held for sale or lease, furnished under any
contract of service or held as raw materials, work-in-process, or
supplies or materials used or consumed in TDC's or its Subsidiaries'
businesses;
"LC/Acceptance Account Agreement" means the LC/Acceptance
Account Agreement dated as of May 23, 1996 among the Borrowers and
the Agent, as amended or modified from time to time;
"Lending Office" means, as to each Lender, the Lending
Office of such Lender designated on the signature pages hereof or in
an Assignment and Acceptance or such other office of such Lender (or
of an affiliate of such Lender) as such Lender may from time to time
specify to the Authorized Representative and the Agent, in the case
of Multicurrency Facilities Lenders, or the Canadian Agent, in the
case of Canadian Facilities Lenders, as the office by which its Loans
are to be made and maintained;
"Letter of Credit" or "Letters of Credit" means a
Commercial Letter(s) of Credit or Standby Letter(s) of Credit
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issued by NationsBank (in the case of Domestic Letters of Credit) and
CIBC (in the case of Canadian Letters of Credit), as described in
Articles II and III hereof;
"Letter of Credit Applications" means, collectively, the
applications and agreements from the applicable Borrower to
NationsBank (in respect of Domestic Letters of Credit) or CIBC (in
respect of Canadian Letters of Credit) executed and delivered from
time to time to support the issuance of Letters of Credit;
"Lien" means any interest in property securing any
obligation owed to, or a claim by, a Person other than the owner of
the property, whether such interest is based on the common law,
statute or contract, and including but not limited to the lien or
security interest arising from a mortgage, encumbrance, pledge,
security agreement, conditional sale or trust receipt or a lease,
consignment or bailment for security purposes. For the purposes of
this Agreement, TDC and its Subsidiaries shall be deemed to be the
owners of any property which it or they have acquired or hold subject
to a conditional sale agreement, financing lease, or other
arrangement pursuant to which title to the property has been retained
by or vested in some other Person for security purposes;
"Loan" or "Loans" means any of the Fixed Rate Loans,
Floating Rate Loans or Canadian Prime Loans, as the context may
require, made pursuant to Articles II and III hereof;
"Loan Documents" means this Agreement, the Notes, the
Guaranties, the LC/Acceptance Account Agreement, the Assumption and
Consent Agreements, the Letter of Credit Applications, the General
Acceptance Agreement for Acceptances, drafts and all other
instruments and documents heretofore or hereafter executed or
delivered to and in favor of any Lenders or the Agents in connection
with the Loans, the Letters of Credit or the Acceptances made, issued
or created under this Agreement as the same may be amended, modified
or supplemented from time to time;
"Multicurrency Facilities" means the revolving credit,
competitive bid, swing line, letter of credit and acceptance
facilities made available by the Lenders pursuant to Article II
hereof;
"Multicurrency Facilities Notes" means, collectively, the
Domestic Revolving Credit Notes, the Competitive Bid Notes and
the Swing Line Note;
"Multi-employer Plan" means an employee pension benefit
plan covered by Title IV of ERISA and in respect of which TDC or any
Subsidiary is an "employer" as described in Section
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4001(b) of ERISA, which is also a multi-employer plan as
defined in Section 4001(a)(3) of ERISA;
"Net Receivables Balance" means the Eligible Receivables
less all those Eligible Receivables excluded pursuant to the Transfer
and Administration Agreement due to concentration;
"Non-Acceptance Lender" means a Lender that is not a
Canadian chartered bank;
"Notes" means, collectively, the Multicurrency Facilities
Notes and the Obligations herein to the Canadian Facilities Lenders
as recorded on the records of the Canadian Agent;
"Obligations" means the obligations, liabilities and
Indebtedness of TDC and its Subsidiaries with respect to (i) the
principal and interest on the Loans as evidenced by the Notes and on
the records of the Canadian Agent as to the Obligations herein to the
Canadian Facilities Lenders, (ii) the Reimbursement Obligations,
(iii) all liabilities of TDC to any Lender which arise under a Swap
Agreement, and (iv) the payment and performance of all other
obligations, liabilities and Indebtedness of TDC and its Subsidiaries
to the Lenders, the Canadian Agent or the Agent, under this
Agreement, under any one or more of the other Loan Documents or with
respect to the Loans;
"Participation" means, with respect to any Multicurrency
Facilities Lender (other than NationsBank) or any Canadian Facilities
Lender (other than CIBC), as the case may be, the extension of credit
represented by the participation of such Lender hereunder in the
liability of (i) in the case of Multicurrency Facilities Lenders,
NationsBank in respect of each Swing Line Loan made, Domestic Letter
of Credit or Domestic Acceptance issued by NationsBank in accordance
with the terms hereof and (ii) in the case of Canadian Facilities
Lenders, CIBC in respect of each Canadian Letter of Credit or
Canadian Acceptance issued by CIBC in accordance with the terms
hereof;
"Percentage Factor" means that fluctuating percentage of
ownership interest in Eligible Receivables which are transferred to
Enterprise under the Transfer and Administration Agreement;
"Permitted Acquisition" means the acquisition by TDC or a
Subsidiary of a controlling equity interest in or all or
substantially all of the assets of any Person, which satisfies each
of the following: (i) such Person is in the same or similar line or
lines of business as that engaged in by TDC and its Subsidiaries; and
(ii) no Default or Event of Default occurs or is created or results
from such transaction;
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"Person" means an individual, limited liability companies,
partnership, corporation, trust, unincorporated organization,
association, joint venture or a government or agency or political
subdivision thereof;
"Prepaid Inventory" means and includes any and all goods,
merchandise and other personal property of TDC and its Subsidiaries
for which payment has been made in full and which would otherwise be
Inventory but for the reason that such property is not in the
possession of TDC or its Subsidiaries;
"Principal Office" means the principal office of the
Agent at Independence Center, 15th Floor, Charlotte, North
Carolina 28255, Attention: Agency Services, or such other
office and address as the Agent may from time to time
designate;
"Rate Hedging Obligations" means any and all obligations of
TDC and its Subsidiaries, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (a) any and all agreements, devices or
arrangements designed to protect at least one of the parties thereto
from the fluctuations of interest rates, exchange rates or forward
rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, dollar-denominated or
cross-currency interest rate exchange agreements, forward currency
exchange agreements, interest rate cap or collar protection
agreements, forward rate currency or interest rate options, puts,
warrants and those commonly known as interest rate "swap" agreements;
and (b) any and all cancellations, buybacks, reversals, terminations
or assignments of any of the foregoing;
"Receivables" mean the short term trade receivables of TDC
and its Subsidiaries generated from the sale of merchandise or
services of TDC or its Subsidiaries;
"Regulation D" means Regulation D of the Board as the
same may be amended or supplemented from time to time;
"Regulatory Change" means any change effective after the
Closing Date in United States federal or state laws or regulations
(including Regulation D and capital adequacy regulations), Canadian
federal or provincial laws or regulations, or other foreign laws or
regulations or the adoption or making after such date of any
interpretations, directives or requests applying to a class of banks,
which includes any of the Lenders, under any United States federal or
state, Canadian federal or provincial, or other foreign laws or
regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged
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with the interpretation or administration thereof or compliance by
any Lender with any request or directive regarding capital adequacy,
including with respect to "highly leveraged transactions," whether or
not having the force of law, whether or not failure to comply
therewith would be unlawful and whether or not published or proposed
prior to the date hereof;
"Reimbursement Obligation" shall mean at any time, the
obligation of any Borrower with respect to any Letter of Credit or
Acceptance to reimburse NationsBank or CIBC, as the case may be, and
the Lenders to the extent of their respective Participations
(including by the receipt by NationsBank or CIBC of proceeds of Loans
pursuant to Articles II or III) for amounts theretofore paid by
NationsBank or CIBC pursuant to a drawing under a Letter of Credit or
payment of an Acceptance;
"Remaining Accounts Receivable" means the product of (i)
Net Receivables Balance multiplied by (ii) a fraction equal to one
(1) minus the Percentage Factor;
"Required Lenders" means, as of any date, Lenders on such
date having Credit Exposures (as defined below) aggregating at least
51% of the aggregate Credit Exposures of all the Lenders on such
date, without distinction or reference as between Canadian Facilities
and Multicurrency Facilities. For purposes of the preceding sentence,
the amount of the "Credit Exposure" of each Lender shall be equal to
the aggregate principal amount of the Loans owing to such Lender plus
the sum of the aggregate unutilized amounts of such Lender's Domestic
Revolving Credit Commitment and Canadian Revolving Credit Commitment
plus the amount of such Lender's Applicable Commitment Percentage of
the aggregate undrawn face amount of the outstanding Letters of
Credit and unpaid face amount of Acceptances and of the Reimbursement
Obligations; provided that, if any Lender shall have failed to pay to
NationsBank or CIBC, as applicable, its Applicable Commitment
Percentage of any Swing Line Loan, drawing under any Letter of Credit
or payment of an Acceptance resulting in an outstanding Reimbursement
Obligation, such Lender's Credit Exposure attributable to (i) Swing
Line Loans, Domestic Letters of Credit, Domestic Acceptances,
Reimbursement Obligations relating to Domestic Letters of Credit and
the Domestic Letter of Credit Commitment shall be deemed to be held
by NationsBank for purposes of this definition, and (ii) Canadian
Letters of Credit, Canadian Acceptances, Reimbursement Obligations
relating to Canadian Letters of Credit and the Canadian Letter of
Credit Commitment shall be deemed to be held by CIBC for purposes of
this definition;
"Revolving Credit Termination Date" means (i) May 31, 1999
or (ii) such earlier date of termination of Lenders' obligations
pursuant to Section 10.01 upon the occurrence of
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an Event of Default, or (iii) such date as the Borrowers may
voluntarily permanently terminate the Multicurrency Facilities and
the Canadian Facilities by payment in full of all Obligations
(including the discharge of all Obligations of NationsBank, CIBC and
the other Lenders with respect to Letters of Credit, Acceptances and
Participations) or (iv) such later date as the Borrowers, the Agent,
the Canadian Agent and the Lenders shall agree in writing pursuant to
Section 2.14 hereof with respect to Multicurrency Facilities or
Section 3.12 with respect to Canadian Facilities;
"Significant Subsidiary" means any Subsidiary which has
either (i) total assets of more than $500,000 or (ii) total revenues
of more than $500,000 during any Four-Quarter Period; provided,
however, in no event shall the sum of total revenues or total assets
of Subsidiaries not constituting Significant Subsidiaries exceed in
either case $2,000,000;
"Single Employer Plan" means any employee pension benefit
plan covered by Title IV of ERISA and in respect of which TDC or any
Subsidiary is an "employer" as described in Section 4001(b) of ERISA,
which is not a Multi-employer Plan;
"Solvent" means, when used with respect to any Person, that
at the time of determination:
(i) the fair value of its assets (both at fair
valuation and at present fair saleable value on an orderly
basis) is in excess of the total amount of its liabilities,
including, without limitation, Contingent Obligations; and
(ii) it is then able and expects to be able to pay
its debts as they mature; and
(iii) it has capital sufficient to carry on its
business as conducted and as proposed to be conducted;
"Spot Rate of Exchange" means, (i) in determining the
Dollar Equivalent Amount of a specified Alternative Currency amount
as of any date, the spot exchange rate determined by the Agent in
accordance with its usual procedures for the purchase by the Agent of
Dollars with such Alternative Currency at approximately 10:00 A.M.,
Charlotte, North Carolina time on the Business Day that is two (2)
Business Days prior to such date, (ii) in determining the Alternative
Currency Equivalent Amount of a specified Dollar amount on any date,
the spot exchange rate determined by the Agent in accordance with its
usual procedures for the purchase by the Agent of such Alternative
Currency with Dollars at approximately 10:00 A.M., Charlotte, North
Carolina time on the Business Day that is two (2) Business Days prior
to such date and (iii) for all Loans under the Total Canadian
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Revolving Credit Commitment in determining the Alternative Currency
Equivalent amount of a specified Dollar amount or the Dollar amount
when converting from Canadian Dollars, the amount in Dollars or
Canadian Dollars, as the case may be, after giving effect to a
conversion of a specified amount in Dollars to an Alternative
Currency or of Alternative Currency to Dollars, as the case may be,
at the rate of exchange quoted as the Bank of Canada noon spot rate
on such date;
"Standby Letter of Credit" means a letter of credit issued
(i) in the case of Domestic Letters of Credit, by NationsBank for the
account of the applicable Multicurrency Facilities Borrower and (ii)
in the case of Canadian Letters of Credit, by CIBC for the account of
TD Canada, in favor of a Person advancing credit or securing an
obligation on behalf of the applicable Borrower; provided that the
expiry date of a Standby Letter of Credit shall not be later than the
thirtieth Business Day preceding the Revolving Credit Termination
Date;
"Subsidiary" means any corporation in which more than 50%
of its outstanding voting stock is owned directly or indirectly by
TDC and/or by one or more of TDC's Subsidiaries;
"Swap Agreement" means one or more agreements with respect
to Indebtedness evidenced by the Notes between one or more Borrowers
and one or more Lenders, on terms mutually acceptable to Borrower and
such Lender or Lenders, which agreements create Rate Hedging
Obligations;
"Swing Line" means the revolving line of credit
established by NationsBank in favor of TDC pursuant to Section
2.15;
"Swing Line Loans" means Loans made by NationsBank to TDC
pursuant to Section 2.15;
"Swing Line Note" means the promissory note of TDC executed
and delivered to NationsBank as provided in Section 2.05(b)
substantially in the form attached as Exhibit E-3, which shall be
delivered to evidence the Swing Line Outstandings;
"Swing Line Outstandings" means, as of any date of
determination, the aggregate principal Indebtedness of TDC on all
Swing Line Loans then outstanding;
"Syndicated Loans" shall mean the Domestic Revolving
Loans that are not Competitive Bid Loans or Swing Line Loans;
"TDC TROL" means the Tax Retention Operating Lease dated
April 26, 1996 between TDC and First Security Bank of Utah in
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its capacity as owner trustee of the TD 1996 Real Estate
Trust;
"TDF" means Tech Data Finance, Inc., a California
corporation, and a wholly-owned Subsidiary of the Borrower;
"Total Canadian Revolving Credit Commitment" means an
amount equal to US $40,000,000, as reduced or increased from time to
time in accordance with Section 3.07;
"Total Canadian Utilization" means, as at any date of
determination, the sum of (i) the aggregate principal amount of all
outstanding Canadian Loans plus (ii) the Canadian Acceptance Usage
plus (iii) the Canadian Letter of Credit Outstandings, in each case
at the Dollar Value or Dollar Equivalent Amount, as the case may be;
"Total Domestic Revolving Credit Commitment" means an
amount equal to $250,000,000, as reduced or increased from time to
time in accordance with Section 2.08;
"Total Domestic Utilization" means, as at any date of
determination, the sum of (i) the aggregate principal amount of all
outstanding Domestic Loans, plus (ii) the Domestic Acceptance Usage,
plus (iii) the Domestic Letter of Credit Outstandings, in each case
at the Dollar Value or Dollar Equivalent Amount, as the case may be;
"Trade Receivable Purchase Facility" means the facility
created for the benefit of TDF and TDC pursuant to the Transfer and
Administration Agreement;
"Transfer and Administration Agreement" means the Transfer
and Administration Agreement dated as of December 22, 1993 among TDC,
TDF and Enterprise, as amended, modified or supplemented from time to
time, providing for the purchase of Receivables of TDF by Enterprise.
1.02 Rules of Interpretation. (a) All accounting terms not
specifically defined herein shall have the meanings assigned to such terms and
shall be interpreted in accordance with Generally Accepted Accounting Principles
applied on a Consistent Basis.
(b) Each term defined in Article 1 or 9 of the Florida Uniform
Commercial Code shall have the meaning given therein unless otherwise defined
herein, except to the extent that the Uniform Commercial Code of another
jurisdiction is controlling, in which case such terms shall have the meaning
given in the Uniform Commercial Code of the applicable jurisdiction.
(c) The headings, subheadings and table of contents used herein or in
any other Loan Document are solely for convenience of reference and shall not
constitute a part of any such document or
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affect the meaning, construction or effect of any provision
thereof.
(d) Except as otherwise expressly provided, references herein to
articles, sections, paragraphs, clauses, annexes, appendices, exhibits and
schedules are references to articles, sections, paragraphs, clauses, annexes,
appendices, exhibits and schedules in or to this Agreement.
(e) All definitions set forth herein or in any other Loan Document
shall apply to the singular as well as the plural form of such defined term, and
all references to the masculine gender shall include reference to the feminine
or neuter gender, and vice versa, as the context may require.
(f) When used herein or in any other Loan Document, words such as
"hereunder", "hereto", "hereof" and "herein" and other words of like import
shall, unless the context clearly indicates to the contrary, refer to the whole
of the applicable document and not to any particular article, section,
subsection, paragraph or clause thereof.
(g) References to "including" means including without limiting the
generality of any description preceding such term, and for purposes hereof the
rule of ejusdem generis shall not be applicable to limit a general statement,
followed by or referable to an enumeration of specific matters, to matters
similar to those specifically mentioned.
(h) Each of the parties to the Loan Documents and their counsel have
reviewed and revised, or requested (or had the opportunity to request) revisions
to, the Loan Documents, and any rule of construction that ambiguities are to be
resolved against the drafting party shall be inapplicable in the construing and
interpretation of the Loan Documents and all exhibits, schedules and appendices
thereto.
(i) Any reference to an officer of any Borrower or any other Person
by reference to the title of such officer shall be deemed to refer to each other
officer of such person, however titled, exercising the same or substantially
similar functions.
(j) All references to any agreement or document as amended, modified
or supplemented, or words of similar effect, shall mean such document or
agreement, as the case may be, as amended, modified or supplemented from time to
time only as and to the extent permitted therein and in the Loan Documents.
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ARTICLE II
The Multicurrency Facilities
2.01 Revolving Credit Facility
(a) Commitment. Subject to the terms and conditions of this
Agreement, each Multicurrency Facilities Lender severally agrees to make
Domestic Advances in Dollars or an Alternative Currency (as specified in the
respective Borrowing Notice) to the Multicurrency Facilities Borrower requesting
such Advance, as the case may be, as specified in the Borrowing Notice, from
time to time from the Closing Date until the Revolving Credit Termination Date,
on a pro rata basis as to the total borrowing requested by such Multicurrency
Facilities Borrower on any day determined by its Applicable Commitment
Percentage, up to but not exceeding a Dollar Value equal to the Domestic
Revolving Credit Commitment of such Multicurrency Facilities Lender, provided,
however, that the Multicurrency Facilities Lenders will not be required and
shall have no obligation to make any Domestic Advance (i) so long as a Default
or an Event of Default has occurred and is continuing or (ii) if the Agent has
accelerated the maturity of the Notes as a result of an Event of Default;
provided further, however, that immediately after giving effect to each Domestic
Advance, the Total Domestic Utilization shall not exceed the Total Domestic
Revolving Credit Commitment. Within such limits, the Multicurrency Facilities
Borrowers may borrow, repay and reborrow hereunder, on a Business Day, from the
Closing Date until, but (as to borrowings and reborrowings) not including, the
Revolving Credit Termination Date; provided, however, that (x) no Fixed Rate
Loan shall be made which has an Interest Period that extends beyond the
Revolving Credit Termination Date and (y) each Fixed Rate Loan may, subject to
the provisions of Section 2.09, be repaid only on the last day of the Interest
Period with respect thereto. The Multicurrency Facilities Borrowers agree that
if at any time the Total Domestic Utilization shall exceed the Total Domestic
Revolving Credit Commitment, the Multicurrency Facilities Borrowers shall
immediately reduce the outstanding Domestic Revolving Loans such that, as a
result of such reduction, the Total Domestic Revolving Credit Facility shall
equal or exceed the Total Domestic Utilization.
(b) Amounts, Advances and Rate Selection. (i) Each request for a
Domestic Advance of an Alternative Currency under a Borrowing Notice shall
constitute such Multicurrency Facilities Borrower's request for a Domestic
Revolving Loan of the Dollar Value of the amount of the Alternative Currency
specified in such Borrowing Notice and for such Loan to be made available by the
Multicurrency Facilities Lenders to such Multicurrency Facilities Borrower in
the Alternative Currency Equivalent Amount of such Dollar Value (determined
based on the Advance Date Exchange Rate applicable to such Domestic Advance).
The principal amount outstanding on any Domestic Loan shall be recorded in the
Agent's records in Dollars
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(in the case of a Domestic Advance of an Alternative Currency as if the Loan had
initially been made in Dollars), based on the amount of any Domestic Advance and
on the Dollar Value of the initial Advance of an Alternative Currency, as
reduced from time to time by the Dollar Equivalent Amount (based on the Advance
Date Exchange Rate applicable to such Domestic Advance) of any principal
payments with respect to such Domestic Advance. In the event a Fixed Rate Loan
of an Alternative Currency is continued, such election to continue the Fixed
Rate Loan shall be treated as a Domestic Advance and the Agent shall notify the
applicable Borrower and the Multicurrency Facilities Lenders of the Advance Date
Exchange Rate, Interest Period and the Eurodollar Rate for such continued Fixed
Rate Loan. The Lenders shall each be deemed to have made a Domestic Advance to
such Multicurrency Facilities Borrower of its Applicable Commitment Percentage
of such Loan of an Alternative Currency and the Agent shall apply the Advance
Date Exchange Rate for such new Interest Period to such continued Alternative
Currency Equivalent Amount to determine the new Dollar Value of such Fixed Rate
Loan and shall adjust its books accordingly. In the event that such adjustment
with respect to a continued Domestic Loan would cause the Total Domestic
Utilization to exceed the Total Domestic Revolving Credit Commitment, the
Multicurrency Facilities Borrowers shall, immediately on the effective date of
such continuation, repay (a "Rate Adjustment Payment") the portion of such
converted Loan (applying the new Advance Date Exchange Rate) necessary to ensure
that the Total Domestic Utilization does not exceed the Total Domestic Revolving
Credit Commitment, provided further that the Domestic Facility Borrowers shall
not be required to pay any additional compensation pursuant to Section 4.04(a)
with respect to a prepayment of a Domestic Loan required by this sentence if
such prepayment is made immediately on the effective date of the continuation
giving rise to such prepayment. For the purposes of determining the amount of
Domestic Loans plus Domestic Letters of Credit Outstandings plus Domestic
Acceptance Usage plus Swing Line Outstandings, it is intended by the parties
that all Domestic Loans shall be the functional equivalent of Loans made and
repaid (based on the applicable Advance Date Exchange Rate for each Advance) in
Dollars. It is recognized that one or more Lenders may elect to record Domestic
Loans or Domestic Advances in Alternative Currencies. The Agent shall maintain
records sufficient to identify at any time, (i) the Advance Date Exchange Rate
with respect to each Domestic Advance, and (ii) the portion of the outstanding
Domestic Revolving Loans attributable to each Domestic Advance. There shall be
no more than eight (8) Domestic Revolving Loans of an Alternative Currency
outstanding at any one time.
(ii) The Total Domestic Utilization shall not exceed at any time an
amount equal to the Total Domestic Revolving Credit Commitment. Each Domestic
Revolving Loan and each conversion under Section 2.09 shall be (A) in the case
of Fixed CD or Eurodollar Rate Loans, in an amount not less than $3,000,000 (or
as to Eurodollar Rate Loans the equivalent thereof if in an Alternative
Currency) and if greater in integral multiples of $1,000,000 (or as
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to Eurodollar Rate Loans the equivalent thereof if in an Alternative Currency
plus accrued interest rounded upward to the nearest $10,000), and (B) in the
case of Domestic Base Rate Loans in an amount not less than $1,000,000, and, if
greater, an integral multiple of $100,000.
(iii) For each Domestic Advance an Authorized Representative shall
give the Agent at least (A) three (3) Business Days irrevocable telecopy or
telex notice of each Fixed Rate Loan in an Alternative Currency (whether
representing an additional borrowing hereunder or the conversion of borrowing
hereunder) prior to 10:30 A.M., Charlotte, North Carolina time, (B) three (3)
Business Days irrevocable telecopy or telex notice prior to 10:30 A.M.,
Charlotte, North Carolina time in the case of Eurodollar Rate Loans in Dollars
or two (2) Business Days irrevocable telecopy or telex notice prior to 10:30
A.M. Charlotte, North Carolina time in the case of Fixed CD Loans, and, (C)
irrevocable telephonic or telefacsimile notice of each Floating Rate Loan
representing a borrowing or conversion hereunder prior to 10:30 A.M. Charlotte,
North Carolina time on the day of such proposed Floating Rate Loan. Each such
Borrowing Notice, which shall be effective upon receipt by the Agent, shall
specify the type of Loan (Fixed Rate or Floating Rate), whether Dollar or
Alternative Currency, amount of the Domestic Loan for which the Domestic Advance
is to be made, the date of borrowing and the Interest Period to be used in the
computation of interest. The Authorized Representative shall provide the Agent
written confirmation of each such telephonic notice on the same day by
telefacsimile transmission in the form of a Borrowing Notice in the form
attached hereto as Exhibit D-1, in each case with appropriate insertions, but
failure to provide such confirmation shall not affect the validity of such
telephonic notice. The duration of the initial Interest Period for each Domestic
Loan shall be as specified in the initial Borrowing Notice. The Multicurrency
Facilities Borrowers shall have the option to elect the duration of subsequent
Interest Periods and to convert the Domestic Loans in accordance with Section
2.09 hereof. If the Agent does not receive a notice of election of duration of
an Interest Period or to convert by the time prescribed hereby and by Section
2.09 hereof, the applicable Multicurrency Facilities Borrower shall be deemed to
have elected a Floating Rate Loan bearing interest at the Domestic Base Rate.
The Fixed CD Rate may only be elected to apply to Domestic Loans made in
Dollars. The Floating CD Rate shall apply only to Swing Line Loans.
(iv) Notice of receipt of each Borrowing Notice in respect of
Domestic Loans shall be provided by the Agent to each Multicurrency Facilities
Lender by telecopy or telex with reasonable promptness, but not later than 12:00
noon, Charlotte, North Carolina time on the same day as Agent's receipt of such
notice from the Multicurrency Facilities Borrowers so long as such receipt is
prior to 10:30 A.M. At approximately 10:00 A.M. Charlotte, North Carolina time
two (2) Business Days preceding the date specified for a Domestic Advance of an
Alternative Currency, the Agent shall
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determine the Advance Date Exchange Rate and the Applicable Rate. Not later than
11:00 A.M. Charlotte, North Carolina time two (2) Business Days preceding the
date specified for each Domestic Advance of an Alternative Currency, the Agent
shall provide the applicable Multicurrency Facilities Borrower and each
Multicurrency Facilities Lender notice by telefacsimile transmission of the
Advance Date Exchange Rate applicable to such Domestic Advance, and the
applicable Alternative Currency Equivalent Amount of the Domestic Loan or
Domestic Loans required to be made by each Multicurrency Facilities Lender on
such date, and the Dollar Value of such Domestic Loan or Domestic Loans and the
Applicable Rate.
(v) In the case of Domestic Advances in Dollars, each Lender shall,
pursuant to the terms and conditions of this Agreement, not later than 12:00
noon, Charlotte, North Carolina time on the date specified for such Domestic
Advance, make the amount of the Domestic Advance to be made by it on such day
available to the Agent by depositing or transferring the proceeds thereof in
immediately available funds to the Agent, at the Principal Office. The amount so
received by the Agent shall, subject to the terms of this Agreement, be made
available to the applicable Multicurrency Facilities Borrower by deposit of the
proceeds to an account of such Multicurrency Facilities Borrower maintained at
the Principal Office or otherwise as shall be directed in the applicable
Borrowing Notice.
(vi) In the case of Domestic Advances of an Alternative Currency, not
later than 9:00 A.M., Charlotte, North Carolina time on the date specified for
each Domestic Advance, each Multicurrency Facilities Lender shall, pursuant to
the terms and subject to the conditions of this Agreement, make the amount of
the Domestic Loan or Domestic Loans to be made by it on such day available to
the applicable Multicurrency Facilities Borrower at the Funding Bank, to the
account of the Agent with the Funding Bank. The amount so received by the
Funding Bank shall, subject to the terms and conditions of the Loan Documents
and upon instruction from the Agent to the Funding Bank on the same day but no
later than 9:00 A.M. Charlotte, North Carolina time, be made available to the
applicable Multicurrency Facilities Borrower by delivery of the Alternative
Currency Equivalent Amount to such Multicurrency Facilities Borrower's account
with the Funding Bank.
(vii) Notwithstanding the foregoing, if a drawing is made under any
Domestic Letter of Credit or presentment is made of a Domestic Acceptance prior
to the Revolving Credit Termination Date and the applicable Multicurrency
Facilities Borrower shall not immediately reimburse NationsBank for the amount
of such draw or payment, then notice of such drawing or payment shall be
provided promptly by NationsBank to the Agent and the Agent shall provide notice
to each Multicurrency Facilities Lender by telephone or telefacsimile. If notice
to the Multicurrency Facilities Lenders of a drawing under any Letter of Credit
or payment under any Domestic Acceptance is given by the Agent at or before
12:00 noon
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Charlotte, North Carolina time on any Business Day, the applicable Multicurrency
Facilities Borrower shall be deemed to have requested, and each Multicurrency
Facilities Lender shall, pursuant to the conditions of this Agreement, make a
Domestic Base Rate Loan under the Domestic Revolving Credit Facility in the
amount of such Multicurrency Facilities Lender's Applicable Commitment
Percentage of such drawing or payment (and in the case of a drawing in an
Alternative Currency, a Floating Rate Loan, in an amount equal to such
Multicurrency Facilities Lender's Applicable Commitment Percentage of the Dollar
Equivalent Amount of such drawing or payment determined on the basis of the Spot
Rate of Exchange on the date of drawing under the Letter of Credit) and shall
pay such amount to the Agent for the account of NationsBank at the Principal
Office in Dollars and in immediately available funds before 2:30 P.M. Charlotte,
North Carolina time on the same Business Day. If notice to the Multicurrency
Facilities Lenders is given by the Agent after 12:00 noon Charlotte, North
Carolina time on any Business Day, the applicable Multicurrency Facilities
Borrower shall be deemed to have requested, and each Multicurrency Facilities
Lender shall, pursuant to the terms and subject to the conditions of this
Agreement, make a Domestic Base Rate Loan under the Domestic Revolving Credit
Facility in the amount of such Multicurrency Facilities Lender's Applicable
Commitment Percentage of such drawing or payment (and in the case of a drawing
in an Alternative Currency, a Domestic Base Rate Loan, in an amount equal to
such Multicurrency Facilities Lender's Applicable Commitment Percentage of the
Dollar Equivalent Amount of such drawing or payment determined on the basis of
the Spot Rate of Exchange on the date of drawing under the Letter of Credit) and
shall pay such amount to the Agent for the account of NationsBank at the
Principal Office in Dollars and in immediately available funds before 12:00 noon
Charlotte, North Carolina time on the next following Business Day. Such Domestic
Base Rate Loan shall continue unless and until the applicable Multicurrency
Facilities Borrower converts such Floating Rate Loan in accordance with the
terms of Section 2.09 hereof.
2.02 Payment of Interest. (a) The Multicurrency Facilities Borrowers
shall pay interest to the Agent for the account of each Multicurrency Facilities
Lender on the outstanding and unpaid principal amount of each Domestic Loan made
by such Multicurrency Facilities Lender for the period commencing on the date of
such Domestic Loan until such Loan shall be due at the then applicable Floating
Rate for Floating Rate Loans or applicable Fixed Rate for Fixed Rate Loans, such
payments to be made in Dollars with respect to Loans made in Dollars, and at the
Applicable Rate in the case of Domestic Loans made in Alternative Currency, such
payments to be made in the appropriate Alternative Currency as designated by the
Authorized Representative pursuant to Section 2.01 hereof or as otherwise
provided herein; provided, however, that if any amount shall not be paid when
due (at maturity, by acceleration or otherwise), all amounts outstanding
hereunder shall bear interest thereafter (i) in the case of a Fixed Rate Loan,
until the end of
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the Interest Period with respect to such Fixed Rate Loan, at a rate of two
percent (2%) above such Fixed Rate and (ii) thereafter, and with respect to
Floating Rate Loans, at a rate of interest per annum which shall be two percent
(2%) above the Domestic Base Rate or the Floating CD Rate, as applicable, or the
maximum rate permitted by applicable law, whichever is lower, from the date such
amount was due and payable until the date such amount is paid in full.
(b) Interest on each Domestic Loan shall be computed on the basis of
a year of 360 days and calculated for the actual number of days elapsed provided
that for Alternative Currency Loans for which a 365-day basis is the only market
practice available to the Agent for such Loan, interest shall be calculated on
the basis of a year of 365-366 days, as the case may be, for the actual days
elapsed. Interest on each Domestic Loan shall be paid (a) quarterly in arrears
on the last Business Day of each fiscal quarter, commencing July 31, 1996, on
each Floating Rate Loan, (b) on the last day of the applicable Interest Period
for each Fixed Rate Loan and, if the Interest Period extends for more than three
months, at intervals of three months after the first day of the Interest Period
and (c) on the Revolving Credit Termination Date. Interest on amounts not paid
when due shall be payable on demand.
2.03 Payment of Principal. (a) The principal amount of each Domestic
Loan (other than a Competitive Bid Loan) shall be due and payable to the Agent
for the benefit of each Multicurrency Facilities Lender in full on the Revolving
Credit Termination Date. Competitive Bid Loans shall be due and payable on the
last day of the Interest Period for such Loan. The duration of the initial
Interest Period for each Domestic Loan that is a Fixed Rate Loan shall be as
specified in the initial Borrowing Notice. The Multicurrency Facilities
Borrowers shall have the option to elect the duration of subsequent Interest
Periods and to convert the Domestic Loans in accordance with Section 2.09
hereof. If the Agent does not receive a notice of election of duration of an
Interest Period or to convert by the time prescribed by Section 2.09 hereof, the
applicable Multicurrency Facilities Borrower shall be deemed to have elected to
convert such Domestic Loan to (or continue such Domestic Loan as) a Domestic
Base Rate Loan until the Multicurrency Facilities Borrower notifies the Agent in
accordance with Section 2.09.
(b) Each payment of principal (including any prepayment) and payment
of interest in respect of Domestic Loans shall be made to the Agent at the
Principal Office, for the account of each Multicurrency Facilities Lender's
applicable Lending Office, to be recorded in Dollars as set forth in Section
2.01(b). The repayment of such principal amount in respect of Loans made in an
Alternative Currency shall be made in the appropriate Alternate Currency as
follows: the portion of the outstanding Domestic Loans attributable to each
specified Domestic Advance (or the continuation or conversion thereof) (as
determined from the Agent's
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records) shall be repaid in the same Alternative Currency as such Domestic
Advance. Each such payment shall be made in immediately available funds before
12:30 P.M. Charlotte, North Carolina time on the date such payment is due. The
Agent may, but shall not be obligated to, debit the amount of any such payment
which is not made by such time to any ordinary deposit account, if any, of the
applicable Multicurrency Facilities Borrower with the Agent. The Multicurrency
Facilities Borrowers shall give the Agent prior telephonic notice of any payment
of principal, such notice to be given by not later than 11:00 A.M. Charlotte,
North Carolina time, on the date of such payment.
(c) The Agent shall deem any payment by or on behalf of the
Multicurrency Facilities Borrowers hereunder that is not made both (a) in
Dollars in the case of Domestic Loans made in Dollars and the required
Alternative Currency in the case of Domestic Loans made in Alternative
Currencies and in immediately available funds and (b) prior to 12:30 P.M.
Charlotte, North Carolina time to be a non-conforming payment. Any such payment
shall not be deemed to be received by the Agent until the time such funds become
available funds in the required currency. The Agent shall give prompt telephonic
notice to the applicable Authorized Representative and each of the Multicurrency
Facilities Lenders (confirmed in writing) if any payment is non-conforming.
Interest shall continue to accrue on any principal as to which a non-conforming
payment is made until such funds become available funds (but in no event less
than the period from the date of such payment to the next succeeding Business
Day) at a rate of interest per annum which shall be two percent (2%) above the
Domestic Base Rate or the maximum rate permitted by applicable law, whichever is
lower, from the date such amount was due and payable until the date such amount
is paid in full.
(d) In the event that any payment hereunder or under the
Multicurrency Facilities Notes becomes due and payable on a day other than a
Business Day, then such due date shall be extended to the next succeeding
Business Day; provided that interest shall continue to accrue during the period
of any such extension.
2.04 Competitive Bid Loans.
(a) In addition to borrowings of Syndicated Loans, at any time prior
to the Revolving Credit Termination Date the Multicurrency Facilities Borrowers
may, as set forth in this Section 2.04, request the Multicurrency Facilities
Lenders to make offers to make Competitive Bid Loans to the Multicurrency
Facilities Borrowers in Dollars. The Multicurrency Facilities Lenders may, but
shall have no obligation to, make such offers and the Multicurrency Facilities
Borrowers may, but shall have no obligation to, accept any such offers in the
manner set forth in this Section 2.04. Competitive Bid Loans shall be Absolute
Rate Loans, provided that:
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(i) the Total Domestic Utilization shall not exceed the
Total Domestic Revolving Credit Commitment;
(ii) there may be no more than four (4) different
Interest Periods for Competitive Bid Loans outstanding at the
same time;
(iii) the aggregate amount of outstanding Competitive Bid
Loans of a Multicurrency Facilities Lender shall not exceed at
any time an amount equal to $25,000,000;
(iv) no Competitive Bid Loan shall have a maturity date
subsequent to the Revolving Credit Termination Date; and
(v) the aggregate amount of Competitive Bid Loans
outstanding at any time shall not exceed $25,000,000 in the
aggregate.
(b) When a Borrower wishes to request offers to make Competitive Bid
Loans, it shall give the Agent (which shall promptly notify the Multicurrency
Facilities Lenders) notice (a "Competitive Bid Quote Request") to be received no
later than 10:00 A.M. on the Business Day next preceding the date of borrowing
proposed therein, (or such other time and date as such Multicurrency Facilities
Borrower and the Agent, with the consent of the Required Lenders, may agree).
The Multicurrency Facilities Borrowers may request offers to make Competitive
Bid Loans for up to three (3) different Interest Periods in a single notice;
provided that the request for each separate Interest Period shall be deemed to
be a separate Competitive Bid Quote Request for a separate borrowing (a
"Competitive Bid Borrowing") and there shall not be outstanding at any one time
more than four (4) Competitive Bid Borrowings. Each such Competitive Bid Quote
Request shall be substantially in the form of Exhibit H hereto and shall specify
as to each Competitive Bid Borrowing:
(i) the proposed date of such borrowing, which shall be
a Business Day;
(ii) the aggregate amount of such Competitive Bid Borrowing,
which shall be at least $5,000,000 (or a larger multiple of
$1,000,000) but shall not cause the limits specified in Section
2.04(a) hereof to be violated;
(iii) the duration of the Interest Period applicable
thereto; and
(iv) the date on which the Competitive Bid Quotes are to be
submitted if it is before the proposed date of borrowing (the date on
which such Competitive Bid Quotes are to be submitted is called the
"Quotation Date").
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Except as otherwise provided in this Section 2.04(b), no Competitive Bid Quote
Request shall be given within five (5) Business Days (or such other number of
days as the applicable Multicurrency Facilities Borrower and the Agent, with the
consent of the Required Lenders, may agree) of any other Competitive Bid Quote
Request.
(c) (i) Each Multicurrency Facilities Lender may submit one
or more Competitive Bid Quotes, each containing an offer to make a
Competitive Bid Loan in response to any Competitive Bid Quote
Request; provided that, if a Multicurrency Facilities Borrower's
request under Section 2.04(b) hereof specified more than one Interest
Period, such Multicurrency Facilities Lender may make a single
submission containing one or more Competitive Bid Quotes for each
such Interest Period. Each Competitive Bid Quote must be submitted to
the Agent not later than 10:00 A.M. Charlotte, North Carolina time on
the Quotation Date (or such case, such other time and date as the
applicable Multicurrency Facilities Borrower and the Agent, with the
consent of the Required Lenders, may agree); provided, that any
Competitive Bid Quote may be submitted by the Agent (or its
Applicable Lending Office) only if the Agent (or such Applicable
Lending Office) notifies the Multicurrency Facilities Borrower of the
terms of the offer contained therein not later than 9:45 A.M.
Charlotte, North Carolina time on the Quotation Date. Subject to
Article IV, Article VII and X hereof, any Competitive Bid Quote so
made shall be irrevocable except with the consent of the Agent given
on the instructions of the applicable Multicurrency Facilities
Borrower.
(ii) Each Competitive Bid Quote shall be substantially in the
form of Exhibit I hereto and shall specify:
(A) the proposed date of borrowing and the Interest
Period therefor;
(B) the principal amount of the Competitive Bid
Loan for which each such order is being made, which
principal amount shall be at least $5,000,000 (or a larger
multiple of $1,000,000); provided that the aggregate
principal amount of all Competitive Bid Loans for which a
Lender submits Competitive Bid Quotes (x) may not exceed
$25,000,000 and (y) may not exceed the principal amount of
the Competitive Bid Borrowing for a particular Interest
Period for which offers were requested;
(C) the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/10,000th of 1%)
offered for each such Competitive Bid Loan (the "Absolute
Rate"); and
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(D) the identity of the quoting Lender.
Unless otherwise agreed by the Agent and the applicable Multicurrency Facilities
Borrower, no Competitive Bid Quote shall contain qualifying, conditional or
similar language or propose terms other than or in addition to those set forth
in the applicable Competitive Bid Quote Request and, in particular, no
Competitive Bid Quote may be conditioned upon acceptance by the applicable
Multicurrency Facilities Borrower of all (or some specified minimum) of the
principal amount of the Competitive Bid Loan for which such Competitive Bid
Quote is being made.
(d) The Agent shall, as promptly as practicable after the Competitive
Bid Quote is submitted (but in any event not later than 10:30 A.M. Charlotte,
North Carolina time on the Quotation Date), notify the applicable Multicurrency
Facilities Borrower of the terms (i) of any Competitive Bid Quote submitted by a
Multicurrency Facilities Lender that is in accordance with Section 2.04(c)
hereof and (ii) of any Competitive Bid Quote that amends, modifies or is
otherwise inconsistent with a previous Competitive Bid Quote submitted by such
Multicurrency Facilities Lender with respect to the same Competitive Bid Quote
Request. Any such subsequent Competitive Bid Quote shall be disregarded by the
Agent unless such subsequent Competitive Bid Quote is submitted solely to
correct a manifest error in such former Competitive Bid Quote. The Agent's
notice to the applicable Multicurrency Facilities Borrower shall specify (A) the
aggregate principal amount of the Competitive Bid Borrowing for which orders
have been received and (B) the respective principal amounts and Absolute Rates
so offered by each Multicurrency Facilities Lender (identifying the
Multicurrency Facilities Lender that made each Competitive Bid Quote).
(e) Not later than 11:00 A.M. Charlotte, North Carolina time on the
Quotation Date (or such other time and date as the applicable Multicurrency
Facilities Borrower and the Agent, with the consent of the Required Lenders, may
agree), the applicable Multicurrency Facilities Borrower shall notify the Agent
of its acceptance or nonacceptance of the offers so notified to it pursuant to
Section 2.04(d) hereof (and the failure of the applicable Multicurrency
Facilities Borrower to give such notice by such time shall constitute
nonacceptance) and the Agent shall promptly notify each affected Multicurrency
Facilities Lender. In the case of acceptance, such notice shall specify the
aggregate principal amount of offers for each Interest Period that are accepted.
The applicable Borrower may accept any Competitive Bid Quote in whole or in part
(provided that any Competitive Bid Quote accepted in part shall be at least
$5,000,000 or a larger multiple of $1,000,000); provided that:
(i) the aggregate principal amount of each Competitive
Bid Borrowing may not exceed the applicable amount set forth
in the related Competitive Bid Quote Request;
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(ii) the aggregate principal amount of each Competitive Bid
Borrowing shall be at least $5,000,000 (or a larger multiple of
$1,000,000) but shall not cause the limits specified in Section
2.04(a) hereof to be violated;
(iii) acceptance of offers may be made only in ascending
order of Absolute Rates, beginning with the lowest rate so
offered; and
(iv) the Multicurrency Facilities Borrowers may not accept any
offer where the Agent has correctly advised the Multicurrency
Facilities Borrowers that such offer fails to comply with Section
2.04(c)(ii) hereof or otherwise fails to comply with the requirements
of this Agreement (including, without limitation, Section 2.04(a)
hereof).
If offers are made by two or more Lenders with the same Absolute Rates, for a
greater aggregate principal amount than the amount in respect of which offers
are accepted for the related Interest Period after the acceptance of all offers,
if any, of all lower Absolute Rates offered by any Multicurrency Facilities
Lender for such related Interest Period, the principal amount of Competitive Bid
Loans in respect of which such offers are accepted shall be allocated by the
applicable Multicurrency Facilities Borrower among such Multicurrency Facilities
Lenders as nearly as possible (in amounts of at least $5,000,000 or larger
multiples of $1,000,000) in proportion to the aggregate principal amount of such
offers. Determinations by the applicable Multicurrency Facilities Borrower of
the amounts of Competitive Bid Loans and the lowest bid after adjustment as
provided in Section 2.04(e)(iii) shall be conclusive in the absence of manifest
error.
(f) Any Multicurrency Facilities Lender whose offer to make any
Competitive Bid Loan has been accepted shall, not later than 1:00 P.M.
Charlotte, North Carolina time on the date specified for the making of such
Loan, make the amount of such Loan available to the Agent at the Principal
Office in Dollars and in immediately available funds, for account of the
applicable Multicurrency Facilities Borrower. The amount so received by the
Agent shall, subject to the terms and conditions of this Agreement, be made
available to the applicable Multicurrency Facilities Borrower on such date by
depositing the same, in Dollars and in immediately available funds, in an
account of the Multicurrency Facilities Borrowers maintained at the Principal
Office or otherwise as shall be directed by the applicable Multicurrency
Facilities Borrower.
2.05 Multicurrency Facilities Notes.
(a) Syndicated Loans made by each Multicurrency Facilities Lender
shall be evidenced by the Domestic Revolving Credit Note payable to the order of
such Lender in the respective amount of its Applicable Commitment Percentage of
the Total Domestic Revolving Credit Commitment, which Domestic Revolving Credit
Note shall be
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dated the Closing Date and shall be duly completed, executed and delivered by
the Multicurrency Facilities Borrowers.
(b) Swing Line Loans made by NationsBank shall be evidenced by the
Swing Line Note payable to the order of NationsBank, which Swing Line Note shall
be dated the Closing Date and shall be duly completed, executed and delivered by
TDC.
(c) Competitive Bid Loans made by each Multicurrency Facilities
Lender shall be evidenced by the Competitive Bid Note payable to the order of
such Lender in the amount of $25,000,000, which Competitive Bid Note shall be
dated the Closing Date and shall be duly completed, executed and delivered by
the Multicurrency Facilities Borrowers.
2.06 Pro Rata Payments. Except as otherwise provided herein, (a) each
payment on account of the principal of and interest on the Syndicated Loans and
the fees described in Section 2.10 hereof shall be made to the Agent for the
account of the Lenders pro rata based on their Applicable Commitment Percentages
of the Total Domestic Revolving Credit Commitment, (b) all payments to be made
by the Multicurrency Facilities Borrowers for the account of each of the
Multicurrency Facilities Lenders on account of principal, interest and fees,
shall be made without set-off or counterclaim, and (c) the Agent will promptly
distribute payments received to the Multicurrency Facilities Lenders.
Notwithstanding the foregoing, in the event any Multicurrency Facilities Lender
shall not be able to make a Fixed Rate Loan as provided in Section 4.05,
interest shall be allocated to each Multicurrency Facilities Lender according to
the interest rate payable to such Multicurrency Facilities Lender.
2.07 Reductions. The Multicurrency Facilities Borrowers shall, by
notice from an Authorized Representative, have the right from time to time (but
not more frequently than once during each fiscal quarter), upon not less than
ten (10) Business Days written notice to the Agent to reduce the Total Domestic
Revolving Credit Commitment. The Agent shall give each Multicurrency Facilities
Lender, within one (1) Business Day, telephonic notice (confirmed in writing) of
such reduction. Each such reduction shall be in the aggregate amount of
$5,000,000 or such greater amount which is in an integral multiple of
$1,000,000, and shall permanently reduce the Total Domestic Revolving Credit
Commitment. No such reduction shall result in the payment of any Fixed Rate Loan
other than on the last day of the Interest Period of such Loan unless such
prepayment is accompanied by amounts due, if any, under Section 4.04. Each such
reduction of the Total Domestic Revolving Credit Commitment shall be accompanied
by payment of the Notes to the extent that the Total Domestic Utilization
exceeds the Total Domestic Revolving Credit Commitment, after giving effect to
such reduction, together with accrued and unpaid interest on the amounts
prepaid.
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2.08 Increase and Decrease in Amounts. The amount of the Total
Domestic Revolving Credit Commitment which shall be available to the
Multicurrency Facilities Borrowers shall be reduced by the aggregate amount of
all Domestic Letters of Credit Outstandings, Swing Line Outstandings, Domestic
Acceptance Usage and Competitive Bid Loans.
2.09 Conversions and Elections of Subsequent Interest Periods.
Provided that no Default or Event of Default shall have occurred and be
continuing and subject to the limitations set forth below and in Sections
4.01(b), 4.02 and 4.03 hereof, the Multicurrency Facilities Borrowers may:
(a) upon notice to the Agent on or before 10:30 A.M. Charlotte, North
Carolina time on any Business Day convert all or a part of Fixed Rate Loans
(other than Competitive Bid Loans) to Floating Rate Loans under the Domestic
Revolving Credit Facility on the last day of the Interest Period for such Fixed
Rate Loans;
(b) on three (3) or in the case of conversions into or
continuations of Domestic Loans as Fixed CD Loans two (2)) Business
Days' notice to the Agent on or before 10:30 A.M. Charlotte, North
Carolina time:
(i) elect a subsequent Interest Period for all or a portion of
Fixed Rate Loans (other than Competitive Bid Loans) under the
Domestic Revolving Credit Facility of Dollars or any Alternate
Currency to begin in the same currency on the last day of the current
Interest Period for such Fixed Rate Loans;
(ii) elect that any Fixed Rate Loan in Dollars (other than
Competitive Bid Loans) under the Domestic Revolving Credit Facility
be converted on the last day of the Interest Period for any Fixed
Rate Loan into another Fixed Rate Loan in Dollars; and
(iii) convert Floating Rate Loans under the Domestic Revolving
Credit Facility to Fixed Rate Loans (other than Competitive Bid
Loans) on any Business Day.
Notice of any such elections or conversions shall be effected by
receipt of an appropriate Borrowing Notice and shall specify the effective date
of such election or conversion and the Interest Period to be applicable to the
Domestic Revolving Loan as continued or converted. Each election and conversion
pursuant to this Section 2.09 shall be subject to the limitations on Fixed Rate
Loans set forth in the definition of "Interest Period" herein and in Section
2.01 and Article IV hereof. All such continuations or conversions of Domestic
Revolving Loans shall be effected pro rata based on the Applicable Commitment
Percentages of the Lenders in respect of the Total Domestic Revolving Credit
Commitment.
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2.10 Unused Fee. For the period beginning on the Closing Date and
ending on the Revolving Credit Termination Date (or such earlier date on which
the Domestic Revolving Credit Facility has terminated), the Multicurrency
Facilities Borrowers agree to pay to the Agent, for the pro rata benefit of the
Multicurrency Facilities Lenders based on their Applicable Commitment
Percentages of the Total Domestic Revolving Credit Commitment, an unused fee
equal to the Applicable Unused Fee times the sum of the daily amount by which
the Total Domestic Revolving Credit Commitment exceeds the sum of average daily
(i) Domestic Revolving Loans, plus (ii) Domestic Letter of Credit Outstanding,
plus (ii) Domestic Acceptance Usage. Swing Line Loans and Competitive Bid Loans
shall not be outstanding Loans for purposes of determining such fee. Such
payments of fees provided for in this Section 2.10 shall be due in arrears on
the last Business Day of each July, October, January and April beginning July
31, 1996 to and on the Revolving Credit Termination Date (or such earlier date
on which the Revolving Credit Facility has terminated). Notwithstanding the
foregoing, so long as any Multicurrency Facilities Lender fails to make
available any portion of its Domestic Revolving Credit Commitment when
requested, such Lender shall not be entitled to receive payment of its pro rata
share of such fee until such Lender shall make available such portion. Such fee
shall be calculated on the basis of a year of 360 days for the actual number of
days elapsed.
2.11 Deficiency Advances. No Multicurrency Facilities Lender shall be
responsible for any default of any other Multicurrency Facilities Lender in
respect to such other Multicurrency Facilities Lender's obligation to make any
Domestic Revolving Loan hereunder nor shall the Domestic Revolving Credit
Commitment of any Multicurrency Facilities Lender hereunder be increased as a
result of such default of any other Multicurrency Facilities Lender. Without
limiting the generality of the foregoing, in the event any Multicurrency
Facilities Lender shall fail to advance funds to a Domestic Revolving Borrower
as herein provided, the Agent may in its discretion, but shall not be obligated
to, advance under the applicable Domestic Revolving Credit Note in its favor as
a Multicurrency Facilities Lender all or any portion of such amount or amounts
(each, a "deficiency advance") and shall thereafter be entitled to payments of
principal of and interest on such deficiency advance in the same manner and at
the same interest rate or rates to which such other Multicurrency Facilities
Lender would have been entitled had it made such advance under its applicable
Domestic Revolving Credit Note; provided that, upon payment to the Agent from
such other Multicurrency Facilities Lender of the entire outstanding amount of
each such deficiency advance, together with accrued and unpaid interest thereon,
from the most recent date or dates interest was paid to the Agent by the
applicable Multicurrency Facilities Borrower on each Domestic Revolving Loan
comprising the deficiency advance at the interest rate per annum for overnight
borrowing by the Agent from the Federal Reserve Bank, then such payment shall be
credited against the applicable Domestic
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Revolving Credit Note of the Agent in full payment of such deficiency advance
and the applicable Multicurrency Facilities Borrower shall be deemed to have
borrowed the amount of such deficiency advance from such other Multicurrency
Facilities Lender as of the most recent date or dates, as the case may be, upon
which any payments of interest were made by such Multicurrency Facilities
Borrower thereon.
2.12 Adjustments by Agent. Notwithstanding the construction of "pro
rata" to mean based on the Applicable Percentage Commitments and any provisions
contained herein for the advancement of funds or distribution of payments on a
pro rata basis, the Agent may, in its discretion, but shall not be obligated to,
adjust downward or upward (but not in excess of any applicable Domestic
Revolving Credit Commitment) the principal amount of any Domestic Revolving Loan
to be made by any Multicurrency Facilities Lender to the nearest amount which is
evenly divisible by $100, and make appropriate related adjustment in the
distribution of payments of principal and interest on the Loans.
2.13 Use of Proceeds. The proceeds of the Loans made pursuant to the
Domestic Revolving Credit Facility hereunder shall be used by the Multicurrency
Facilities Borrowers to repay and terminate the Prior Domestic Facilities, Prior
TD Canadian Facilities and the Prior TD France Facility, to finance Capital
Expenditures and Permitted Acquisitions and for other working capital and
general corporate needs of TDC and its Subsidiaries, to the extent permitted
under this Agreement.
2.14 Extension of Revolving Credit Termination Date. At the request
of the Multicurrency Facilities Borrowers the Lenders may, in their sole
discretion, elect to extend the Revolving Credit Termination Date for
Multicurrency Facilities then in effect for additional periods of one year. The
Borrowers shall notify the Lenders of their request for such an extension by
delivering to the Agent notice of such request signed by an Authorized
Representative not more than one hundred and twenty (120) days nor less than
sixty (60) days prior to the second anniversary of the Closing Date. If all the
Lenders shall elect to so extend both the Domestic Facilities and the Canadian
Facilities, the Agent shall notify the Multicurrency Facilities Borrowers in
writing within sixty (60) days of its receipt of such request for extension of
the decision of the Lenders of whether to extend the Revolving Credit
Termination Date for Multicurrency Facilities. Failure by the Agent to give such
notice shall constitute refusal by the Lenders to extend the Revolving Credit
Termination Date for the Multicurrency Facilities.
2.15 Swing Line. Notwithstanding any other provision of this
Agreement to the contrary, in order to administer the Domestic Revolving Credit
Facility in an efficient manner and to minimize the transfer of funds between
the Agent and the Multicurrency Facilities Lenders, NationsBank shall make
available Swing Line
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Loans to TDC in Dollars prior to the Revolving Credit Termination Date.
NationsBank shall not make any Swing Line Loan pursuant hereto (i) if the
Borrowers are not in compliance with all the conditions to the making of Loans
set forth in this Agreement, (ii) if after giving effect to such Swing Line
Loan, the Swing Line Loans outstanding exceed $15,000,000, or (iii) if after
giving effect to such Swing Line Loan, the Total Domestic Utilization exceeds
the Total Domestic Revolving Credit Commitment. Loans made pursuant to this
Section 2.15 shall be limited to Floating CD Loans.
(i) TDC may borrow, repay and reborrow under this Section
2.15. Borrowings under the Swing Line may be made in amounts of
$250,000 and multiples of $250,000 in excess thereof, upon telephonic
(confirmed in writing) or telefacsimile request by an Authorized
Representative of TDC made to NationsBank not later than 12:00 noon
Charlotte, North Carolina time on the Business Day of the requested
borrowing. Each repayment of a Swing Line Loan shall be in integral
multiples of $250,000 with a minimum amount of $250,000.
(ii) If TDC instructs NationsBank to debit its demand deposit
account in an amount of any payment with respect to a Swing Line
Loan, or NationsBank otherwise receives repayment after 2:00 P.M.
Charlotte, North Carolina time, on a Business Day, such payment shall
be deemed received on the next Business Day. TDC shall pay interest
on Swing Line Loans quarterly on the last Business Day of each
quarter, commencing July 31, 1996 and continuing on each October,
January, April and July thereafter. Interest shall be calculated on
the basis of a year of 360 days and calculated for the actual number
of days elapsed.
(iii) The Multicurrency Facilities Borrowers and each
Multicurrency Facilities Lender which is or may become a party hereto
acknowledge that all Swing Line Loans are to be made solely by
NationsBank to TDC but that such Multicurrency Facilities Lender
shall share the risk of loss with respect to such Advances in an
amount equal to such Lender's Applicable Commitment Percentage of
such Swing Line Loan. Upon demand according to its Applicable
Commitment Percentage of such Swing Line Loan, each Multicurrency
Facilities Lender shall promptly provide to NationsBank its purchase
price therefor in an amount equal to its Participation therein, in
which case such Swing Line Loan shall be deemed from and after such
date (to the extent TDC has not converted such loan pursuant to
Section 2.09) a Syndicated Loan made in accordance with the
Agreement. The obligation of each Lender to so provide its purchase
price to NationsBank shall be absolute and unconditional and shall
not be affected by the occurrence of an Event of Default or any other
occurrence or event.
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(iv) TDC at its option may request an Advance as a Domestic
Revolving Loan pursuant to Section 2.01 in an amount sufficient to
repay any or all Swing Line Loans on any date (subject to three (3)
Business Days prior notice in the case of Eurodollar Loans or (5)
Business Days prior notice in the case of Loans in an Alternative
Currency) and the Agent shall upon the receipt of such Advance,
provide to NationsBank the amount necessary to repay such Swing Line
Loan or Loans (which NationsBank shall then apply to such repayment)
and credit any balance of the Domestic Revolving Loan in immediately
available funds to an account of TDC at the Principal Office or as
otherwise directed by TDC. The proceeds of such Advances shall be
paid to NationsBank for application to the outstanding Swing Line
Loans and the Lenders shall then be deemed to have made Domestic
Revolving Loans in the amount of such Advances. The obligation of
NationsBank to fund the Swing Line shall cease upon the earliest of
(i) the occurrence of a Default or Event of Default, or (ii) the
Revolving Credit Termination Date, or (iii) the date of resignation
by NationsBank as Agent; provided that when a Default is no longer
continuing NationsBank shall be obligated to provide Swing Line Loans
unless payment of the Obligations has been accelerated.
2.16 Additional Multicurrency Facilities Borrowers. Upon the request
of the Multicurrency Facilities Borrowers as then constituted hereunder (the
"Current Borrowers") and with the consent of the Agent and the Lenders,
additional wholly-owned Subsidiaries of TDC may be added as Multicurrency
Facilities Borrowers (each, an "Additional Borrower") as herein provided. Not
later than twenty (20) days prior to the proposed effective date of such
addition, an Authorized Representative of the Current Borrowers shall request
the addition of such Additional Borrower by notice in writing to the Agent,
which notice shall identify the proposed Additional Borrower and the proposed
effective date of such addition, and shall constitute the Current Borrowers'
representation and warranty to the Agents and the Lenders that they shall
deliver or cause to be delivered, as appropriate, the documents required by this
Section 2.16 in connection with such addition.
If the Agent and the Lenders shall consent to the addition of such
proposed Additional Borrower (which consent shall be indicated by written notice
thereof from the Agent to the Multicurrency Facilities Borrowers and the
Lenders, and which consent may be subject to additional conditions, including
payments of additional fees as may be specified by the Agent in such notice),
then such proposed Additional Borrower shall be and become a Multicurrency
Facilities Borrower for all purposes of the Loan Documents upon the satisfaction
of all of the following conditions:
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(i) no Default or Event of Default shall exist or be
continuing immediately prior to or on giving effect to such
addition;
(ii) the Additional Borrower and the Current Borrowers shall
execute and deliver to the Lenders replacement Domestic Revolving
Credit Notes and Competitive Bid Notes executed by each of them;
(iii) the Additional Borrower, the Current Borrowers and all
persons who have in effect a Guaranty in respect of the Domestic
Loans (the "Domestic Credit Parties") shall execute and deliver an
Assumption and Consent Agreement in the form
attached as Exhibit J hereto;
(iv) the Agent shall receive the opinion of counsel to the
Domestic Credit Parties acceptable to the Agent addressed to the
Agent and the Lenders as to the authorization, execution, delivery
and enforceability of the documents described in clauses (ii) and
(iii) and as to such other matters as it may request, such opinion to
be acceptable in form and content to the Agent and its special
counsel;
(v) the Additional Borrower shall have furnished to the
Agent its certificate appointing an initial Authorized
Representative; and
(vi) all additional conditions, including the payment of any fees
in connection therewith, as may be specified by the Agent, shall have
been satisfied.
Upon satisfaction of such condition, the Additional Borrower shall
thereafter be and become a Multicurrency Facilities Borrower for all purposes of
the Loan Documents.
2.17 One Loan. (a) All Domestic Loans and Domestic Advances by the
Multicurrency Facilities Lenders to any Multicurrency Facilities Borrower shall
constitute the joint and several general obligation of each of the Multicurrency
Facilities Borrowers. Each Multicurrency Facilities Borrower shall be jointly
and severally liable to the Agent and the Multicurrency Facilities Lenders for
all Obligations hereunder in respect of Multicurrency Facilities , regardless
whether such Obligations arise as a result of Domestic Advances to such
Borrower, it being stipulated and agreed that Domestic Advances hereunder to any
Multicurrency Facilities Borrower inure to the benefit of each of the Borrowers,
and that the Multicurrency Facilities Lenders are relying on the joint and
several liability of the Multicurrency Facilities Borrowers in extending credit
under the Multicurrency Facilities.
(b) Each Multicurrency Facilities Borrower guarantees to the
Multicurrency Facilities Lenders the payment in full of all of the
Obligations of the other Multicurrency Facilities Borrowers to the
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Multicurrency Facilities Lenders in respect of Multicurrency Facilities and
further guarantees the due performance by each other Multicurrency Facilities
Borrower of its respective duties and covenants made in favor of the Agent and
the Multicurrency Facilities Lenders hereunder. Each Multicurrency Facilities
Borrower agrees that the joint and several liability of the Multicurrency
Facilities Borrowers shall not be impaired or affected by any modification,
supplement, extension or amendment of any contract or agreement to which the
parties thereto may hereafter agree, nor by any modification, release or other
alteration of any of the rights of the Agent and the Multicurrency Facilities
Lenders with respect to any collateral, nor by any delay, extension of time,
renewal, compromise or other indulgence granted by the Agent and the
Multicurrency Facilities Lenders with respect to any of the Obligations, nor by
any other agreements or arrangements whatever with any other Multicurrency
Facilities Borrower, and guarantor or any other Person, each Multicurrency
Facilities Borrower hereby waiving all notice of any such delay, extension,
release, substitution, renewal, compromise or other indulgence, and hereby
consenting to be bound thereby as fully and effectually as if it had expressly
agreed thereto in advance. The liability of each Multicurrency Facilities
Borrower hereunder is direct and unconditional as to all of the Obligations
hereunder in respect of the Multicurrency Facilities, and may be enforced
without requiring the Agent or the Multicurrency Facilities Lenders first to
resort to any other right, remedy or security; no Multicurrency Facilities
Borrower shall have any right of subrogation, reimbursement or indemnity
whatsoever, nor any right of recourse to security for any of the Obligations in
respect of the Multicurrency Facilities, unless and until all of said
Obligations have been paid in full.
2.18 Letters of Credit. NationsBank agrees, subject to the terms and
conditions of this Agreement, to maintain the Existing Domestic Letters of
Credit as Letters of Credit hereunder and upon request of a Multicurrency
Facilities Borrower to issue from time to time for the account of such Borrower
Domestic Letters of Credit upon delivery to NationsBank of a Letter of Credit
Application therefor in form and content acceptable to NationsBank; provided,
that the Domestic Letter of Credit Outstandings hereunder shall not exceed the
Domestic Letter of Credit Commitment. No Domestic Letter of Credit shall be
issued by NationsBank with an expiry date or payment date occurring subsequent
to the fifth Business Day preceding the Revolving Credit Termination Date and no
Commercial Letter of Credit shall have an expiry date occurring more than six
(6) months after the date of its issuance. NationsBank shall not be required to
issue any Letter of Credit if Total Domestic Utilization when added to the face
amount of any requested Domestic Letter of Credit exceeds the Total Domestic
Revolving Credit Commitment.
2.19 Acceptances. NationsBank agrees, subject to the terms
and conditions hereof until the day prior to the Revolving Credit
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Termination Date, to maintain the Existing Domestic Acceptances as Domestic
Acceptances hereunder and, upon the request of a Multicurrency Facilities
Borrower, to create, from time to time, Domestic Acceptances for the benefit of
such Borrower. NationsBank shall create such Domestic Acceptances by accepting
and discounting drafts drawn by the Borrower under and pursuant to this
Agreement. NationsBank shall not accept any such drafts unless the resulting
Acceptance shall be a Domestic Acceptance as defined in Section 1.01 hereof.
Upon accepting a draft NationsBank may discount the resulting Domestic
Acceptance at a rate per annum (based on a year of 360 days) equal to the BA
Rate. NationsBank shall not be required to create any Domestic Acceptance if the
amount payable under such Domestic Acceptance when added to the Total Domestic
Utilization exceeds the Total Domestic Revolving Credit Commitment. The face
amount of Domestic Acceptances shall be an integral multiple of $500,000 and
shall not be less than $1,000,000. The creation date and maturity date of each
Domestic Acceptance shall be a Business Day. Notwithstanding the foregoing, the
Agent shall not be obligated to create or discount any Domestic Acceptance as
amended from time to time, (i) if creation thereof would cause the Agent to
exceed the maximum amount of outstanding bankers' acceptances permitted by
applicable law, or (ii) if, in the reasonable opinion of the Agent, general
conditions in the public market for rediscounting bankers' acceptances render it
inadvisable to do so.
2.20 Creation of Acceptance. Any request for creation of a Domestic
Acceptance shall be made at least two (2) Business Days in advance of the day
upon which such Domestic Acceptance is to be created (the "Domestic Acceptance
Date"); such request to be in writing and in the form of Borrowing Notice set
forth in Exhibit D-3. No Domestic Acceptance shall be created by NationsBank
with a maturity date occurring subsequent to the Revolving Credit Termination
Date. If NationsBank creates the requested Domestic Acceptance, then on or
before 11:00 A.M., Charlotte, North Carolina time on the Domestic Acceptance
Date, NationsBank shall notify the Borrower of the BA Rate plus Acceptance
Addition at which the Domestic Acceptance will be discounted by NationsBank, and
NationsBank shall promptly thereafter accept the draft of Multicurrency
Facilities Borrower for the amount and Interest Period requested. Upon the
discounting of each Domestic Acceptance, NationsBank shall credit Borrower's
Account with an amount equal to the net proceeds of such discounted Domestic
Acceptance. In addition, NationsBank shall promptly remit to the Agent the full
amount of the Acceptance Addition and the Agent shall promptly transfer to each
Domestic Facilities Lender its Applicable Commitment Percentage of such
Acceptance Addition. In order to enable NationsBank to create Domestic
Acceptances in the manner specified in this Section 2.20, the Multicurrency
Facilities Borrowers agree to promptly upon request furnish to NationsBank a
sufficient number of drafts conforming to NationsBank requirements. All drafts
shall be manually signed by a properly authorized officer. Each Multicurrency
Facilities Borrower will be bound by
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each draft and Domestic Acceptance bearing the signature of an individual who
may no longer be authorized or otherwise holding office of a Multicurrency
Facilities Borrower at any time. Each Multicurrency Facilities Borrower agrees
to compensate NationsBank for any loss or expense with respect to a draft or
Domestic Acceptance dealt with by NationsBank under this Agreement.
2.21 Reimbursement.
(a) Each Multicurrency Facilities Borrower hereby
unconditionally agrees immediately to pay to NationsBank on demand at the
Principal Office (i) all amounts required to pay all drafts drawn or purporting
to be drawn under the Domestic Letters of Credit and (ii) the face amount of
each draft accepted by NationsBank on the maturity date of such draft, or in the
event of an Event of Default or in the event a Domestic Acceptance is determined
not to be eligible for discount, and any and all expenses of every kind incurred
by NationsBank in connection with the Domestic Letters of Credit and Domestic
Acceptances and in any event and without demand to place in the possession of
NationsBank (which shall include Domestic Advances under the Domestic Revolving
Credit Facility if permitted by Section 2.01(b)(vii) hereof) sufficient funds to
pay all debts and liabilities arising under any Domestic Letter of Credit and
Domestic Acceptance. The Multicurrency Facilities Borrowers' obligations to pay
NationsBank under this Section 2.21, and the right of NationsBank to receive the
same, shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever. NationsBank may charge the Borrower's Account or any
other account any Multicurrency Facilities Borrower may have with it for any and
all amounts NationsBank pays under a Domestic Letter of Credit or Domestic
Acceptance; provided that to the extent permitted by Section 2.01(b)(vii),
amounts shall be paid pursuant to Domestic Advances under the Domestic Revolving
Credit Facility. Each Multicurrency Facilities Borrower agrees that NationsBank
may, in its sole discretion, accept or pay, as complying with the terms of any
Domestic Letter of Credit or Domestic Acceptance, any drafts or other documents
otherwise in order which may be signed or issued by an administrator, executor,
trustee in bankruptcy, debtor in possession, assignee for the benefit of
creditors, liquidator, receiver, attorney in fact or other legal representative
of a party who is authorized under such Domestic Letter of Credit or Domestic
Acceptance to draw or issue any drafts or other documents. Each Multicurrency
Facilities Borrower agrees to pay NationsBank interest on any amounts not paid
when due hereunder at the Domestic Base Rate plus two percent (2%), or such
lower rate as may be required by law.
(b) In accordance with the provisions of Section
2.01(b)(vii) hereof, NationsBank shall notify the Agent (and shall also notify
the applicable Multicurrency Facilities Borrower) of any drawing under any
Domestic Letter of Credit or payment of any draft, constituting a Domestic
Acceptance issued for the account of
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a Multicurrency Facilities Borrower as promptly as practicable following the
receipt by NationsBank of such drawing.
(c) Each Multicurrency Facilities Lender (other than
NationsBank) shall automatically acquire on the date of issuance thereof, a
Participation in the liability of NationsBank in respect of each Domestic Letter
of Credit or Domestic Acceptance in an amount equal to such Lender's Applicable
Commitment Percentage (determined in respect of the Total Domestic Revolving
Credit Commitment) of such liability, and to the extent that any Multicurrency
Facilities Borrower is obligated to pay NationsBank under Section 2.21(a), each
Lender (other than NationsBank) thereby shall absolutely, unconditionally and
irrevocably assume, and shall be unconditionally obligated to pay to NationsBank
as hereinafter described, its Applicable Commitment Percentage (determined in
respect of the Total Domestic Revolving Credit Commitment) of the liability of
NationsBank under such Domestic Letter of Credit or Domestic Acceptance. Prior
to the Revolving Credit Termination Date, each Multicurrency Facilities Lender
(including NationsBank in its capacity as a Multicurrency Facilities Lender)
shall, subject to the terms and conditions of this Article II, make a Domestic
Base Rate Loan to the Borrower by paying to the Agent for the account of
NationsBank at the Principal Office in Dollars and in immediately available
funds, an amount equal to its Applicable Commitment Percentage (determined in
respect of the Total Domestic Revolving Credit Commitment) of any drawing under
a Domestic Letter of Credit or payment of a Domestic Acceptance, all as
described and pursuant to Section 2.01(b)(vii). With respect to drawings under
any of the Domestic Letters of Credit or payment of a Domestic Acceptance, each
Multicurrency Facilities Lender, upon receipt from the Agent of notice of a
drawing in the manner described in Section 2.01(b)(vii), shall promptly pay to
the Agent for the account of NationsBank, prior to the applicable time set forth
in Section 2.01(b)(vii), its Applicable Commitment Percentage (determined in
respect of the Total Domestic Revolving Credit Commitment) of such drawing or
payment. Simultaneously with the making of each such payment by a Multicurrency
Facilities Lender to NationsBank, such Multicurrency Facilities Lender shall,
automatically and without any further action on the part of NationsBank or such
Multicurrency Facilities Lender, acquire a Participation in an amount equal to
such payment (excluding the portion thereof constituting interest accruing
before such Multicurrency Facilities Lender made such payment) in the related
Reimbursement Obligation of the Borrower. The Reimbursement Obligations of the
Multicurrency Facilities Borrowers shall be immediately due and payable whether
by Domestic Advances made in accordance with Section 2.01(b)(vii) or otherwise.
Each Multicurrency Facilities Lender's obligation to make payment to the Agent
for the account of NationsBank pursuant to this Section 2.21, and the right of
NationsBank to receive the same, shall be absolute and unconditional, shall not
be affected by any circumstance whatsoever and shall be made without any offset,
abatement, withholding or reduction whatsoever. If any Multicurrency
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Facilities Lender is obligated to pay but does not pay amounts to the Agent for
the account of NationsBank in full upon such request as required by this Section
2.21(c), such Multicurrency Facilities Lender shall, on demand, pay to the Agent
for the account of NationsBank interest on the unpaid amount for each day during
the period commencing on the date of notice given to such Lender pursuant to
Section 2.01(b)(vii) until such Multicurrency Facilities Lender pays such amount
to the Agent for the account of NationsBank in full at the interest rate per
annum for overnight borrowing by NationsBank from the Federal Reserve Bank.
(d) Promptly following the end of each calendar month,
NationsBank shall deliver to the Agent, and the Agent shall deliver to each
Multicurrency Facilities Lender, a notice describing the aggregate undrawn
amount of all Domestic Letters of Credit and aggregate face amount of all drafts
constituting Domestic Acceptances accepted and outstanding at the end of such
month. Upon the request of any Multicurrency Facilities Lender from time to
time, NationsBank shall deliver to the Agent, and the Agent shall deliver to
such Multicurrency Facilities Lender, any other information reasonably requested
by such Multicurrency Facilities Lender with respect to each Domestic Letter of
Credit and Domestic Acceptance then outstanding.
(e) The issuance by NationsBank of each Domestic Letter
of Credit and a Domestic Acceptance shall, in addition to the conditions
precedent set forth in Section 5.01 hereof, be subject to the conditions that
such Domestic Letter of Credit and Domestic Acceptance be in such form, contain
such terms and support such transactions or obligations as shall be reasonably
satisfactory to NationsBank consistent with the then current practices and
procedures of NationsBank with respect to similar letters of credit and
acceptances. All Domestic Letters of Credit shall be issued pursuant to and
subject to the Uniform Customs and Practice for Documentary Credits, 1993
revision, International Chamber of Commerce Publication No. 500 and all
subsequent amendments and revisions thereto. The applicable Multicurrency
Facilities Borrower shall have executed and delivered such other instruments and
agreements relating to such Domestic Letter of Credit and Domestic Acceptance as
NationsBank shall have reasonably requested consistent with such practices and
procedures.
(f) Without duplication of Section 11.07 hereof, each
Multicurrency Facilities Borrower hereby indemnifies and holds harmless
NationsBank, each other Multicurrency Facilities Lender and the Agent from and
against any and all claims and damages, losses, liabilities, costs or expenses
which NationsBank, such other Multicurrency Facilities Lender or the Agent may
incur (or which may be claimed against NationsBank, such other Multicurrency
Facilities Lender or the Agent) by any Person by reason of or in connection with
the issuance or transfer of or payment or failure to pay under any Domestic
Letter of Credit or Domestic Acceptance; provided that the Multicurrency
Facilities Borrowers shall not be
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required to indemnify NationsBank, any other Multicurrency Facilities Lender or
the Agent for any claims, damages, losses, liabilities, costs or expenses to the
extent, but only to the extent, (i) caused by the willful misconduct or gross
negligence of the party to be indemnified, (ii) caused by the failure of
NationsBank to pay under any Domestic Letter of Credit or Domestic Acceptance
after the presentation to it of a request strictly complying with the terms and
conditions of such Domestic Letter of Credit or Domestic Acceptance, unless such
payment or reimbursement is prohibited by any governmental authority, law,
regulation, court order or decree, or (iii) paid or payable by any Multicurrency
Facilities Lender under Sections 2.11 or 11.10 hereof.
(g) Without limiting Borrowers' rights as set forth in
Section 2.21(f) above, the obligation of the Multicurrency Facilities Borrowers
to immediately reimburse Agent for drawings made under Domestic Letters of
Credit or payment of Domestic Acceptances shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement and such Domestic Letters of Credit or Domestic Acceptances,
under all circumstances whatsoever, including, without limitation, the following
circumstances:
(i) any lack of validity or enforceability of the
Domestic Letter of Credit or Domestic Acceptance, the obligation supported by
the Domestic Letter of Credit or Domestic Acceptance or any other agreement or
instrument relating thereto (collectively, the "Domestic Related Documents");
(ii) any amendment or waiver of or any consent to or
departure from all or any of the Domestic Related Documents;
(iii) the existence of any claim, setoff, defense or
other rights which any Multicurrency Facilities Borrower may have at any time
against any beneficiary or any transferee of a Domestic Letter of Credit or
Domestic Acceptance (or any persons or entities for whom any such beneficiary or
any such transferee may be acting), Agent, Multicurrency Facilities Lenders or
any other person or entity, whether in connection with the Loan Documents, the
Domestic Related Documents or any unrelated transaction;
(iv) any breach of contract or other dispute between
any Multicurrency Facilities Borrower and any beneficiary or any transferee of a
Domestic Letter of Credit or Domestic Acceptance (or any persons or entities for
whom such beneficiary or any such transferee may be acting), Agent,
Multicurrency Facilities Lenders or any other person or entity;
(v) any draft, statement or any other document
presented under the Domestic Letter of Credit or Domestic Acceptance proving to
be forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect whatsoever;
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(vi) any delay, extension of time, renewal,
compromise or other indulgence or modification granted or agreed to by Agent,
with or without notice to or approval by any Multicurrency Facilities Borrower
in respect of any of a Multicurrency Facilities Borrower's indebtedness under
this Agreement; or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing;
provided, however, that nothing contained herein shall be deemed to release
NationsBank or any other Multicurrency Facilities Lender of any liability for
actual loss arising as a result of its gross negligence or willful misconduct.
(h) Each Multicurrency Facilities Borrower acknowledges
and agrees that the pricing for Domestic Acceptances hereunder is based upon the
assumption that such Domestic Acceptances are "eligible" for discount by the
Federal Reserve Banks and that the Multicurrency Facilities Lenders are not
required to maintain reserves for such Domestic Acceptances under the
Regulations of the Federal Reserve System. In the event the Federal Reserve
System shall conclude the Domestic Acceptances created hereunder are ineligible
or that reserves are required to be maintained in connection therewith, each
Multicurrency Facilities Borrower shall and does hereby indemnify and hold the
Agent and the Multicurrency Facilities Lenders harmless, and does hereby agree
to, pay all reasonable costs, expenses, legal fees, penalties, as well as all
retroactive, current and prospective reserve requirements arising in connection
with such Domestic Acceptances. Additionally, each Multicurrency Facilities
Borrower acknowledges and agrees that upon the Federal Reserve System reaching
such conclusion, NationsBank and the other Multicurrency Facilities Lenders
shall have no further obligation to create Domestic Acceptances and that in the
event NationsBank and the other Multicurrency Facilities Lenders agree to create
further Domestic Acceptances, those created may, at the option of NationsBank
and the other Multicurrency Facilities Lenders, be priced at a rate higher than
indicated in Section 2.19 in order to compensate NationsBank and the other
Multicurrency Facilities Lenders for additional reserve requirements and other
transactional costs.
Notwithstanding anything to the contrary contained herein
or otherwise, the Multicurrency Facilities Borrowers shall have no obligation to
indemnify NationsBank and the other Multicurrency Facilities Lenders or to pay
any extraordinary costs in connection with Domestic Acceptances which are
determined by the Federal Reserve System to be ineligible solely and directly as
a result of a mistake or error by NationsBank in performing ministerial
functions with respect to the Domestic Acceptances. Additionally, each
Multicurrency Facilities Borrower shall be entitled to dispute and contest any
determination of ineligibility which gives rise to Multicurrency Facilities
Borrowers' indemnification and promise to
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pay set forth herein, provided, however, the Multicurrency Facilities Borrower
shall diligently and expeditiously prosecute such dispute or contest. Each
Multicurrency Facilities Borrower acknowledges and agrees that the refusal of
the Federal Reserve System to recognize a dispute or contest raised by the
Multicurrency Facilities Borrower shall in no way alter, impair, diminish or
affect the obligations of the Multicurrency Facilities Borrowers set forth in
this Subsection. Should the Multicurrency Facilities Borrowers fail promptly to
pay for, dispute or contest any determination of ineligibility as herein
provided, NationsBank and the other Multicurrency Facilities Lenders shall be
entitled to pay, contest or dispute same and all sums expended by NationsBank
and the other Multicurrency Facilities Lenders in doing so shall constitute
additional Indebtedness of the Multicurrency Facilities Borrowers to the
Multicurrency Facilities Lenders and shall bear interest from the date paid
until the date repaid at the Domestic Base Rate plus two percent (2%) per annum.
2.22 Domestic Letter of Credit Fee. (a) For the period beginning on
the Closing Date and ending on the Revolving Credit Termination Date, the
Multicurrency Facilities Borrowers agree to pay to the Agent, for the pro rata
benefit of the Multicurrency Facilities Lenders based on their Applicable
Commitment Percentages determined in respect of the Total Domestic Revolving
Credit Commitment, a fee for such period at a per annum rate equal to the
Applicable Interest Addition for Eurodollar Rate Loans on the daily aggregate
amount available to be drawn under Standby Letters of Credit and fees for such
period at those rates established from time to time by the Agent.
(b) For the period beginning on the Closing Date and
ending on the Revolving Credit Termination Date, the Multicurrency Facilities
Borrowers agree to pay to the Agent for the account of NationsBank as issuer of
the Domestic Letter of Credit, a fee for such period at a per annum rate equal
to .125% on the daily aggregate amount available to be drawn under Domestic
Letters of Credit.
(c) Such payments of fees provided for in this Section
2.22 shall be due with respect to each Domestic Letter of Credit quarterly in
arrears, the first such payment to be made on the last Business Day of July 31,
1996 and on the last Business Day of each October, January, April and July
thereafter.
2.23 Administrative Fees and Reserves. The Multicurrency Facilities
Borrowers shall pay to NationsBank administrative and other fees, if any, in
connection with the Domestic Letters of Credit and Domestic Acceptances in such
amounts and at such times as NationsBank and the Multicurrency Facilities
Borrowers shall agree from time to time. In addition, the Multicurrency
Facilities Borrowers shall reimburse NationsBank for all costs or reduction in
yield occurring by reason of the issuance by NationsBank of the Domestic Letters
of Credit.
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ARTICLE III
CANADIAN FACILITIES
3.01 Revolving Credit Facility.
(a) Commitment. Subject to the terms and conditions of this
Agreement, each Canadian Facilities Lender severally agrees to make Canadian
Advances in Dollars or Canadian Dollars (as specified in the respective
Borrowing Notice) to TD Canada, as specified in the Borrowing Notice, from time
to time from the Closing Date until the Revolving Credit Termination Date on a
pro rata basis as to the total borrowing requested by TD Canada on any day
determined by its Applicable Commitment Percentage up to but not exceeding a
Dollar Value equal to the Canadian Credit Commitment of such Canadian Facilities
Lender, provided, however, that the Canadian Facilities Lenders will not be
required and shall have no obligation to make any Canadian Advance (i) so long
as a Default or an Event of Default has occurred and is continuing or (ii) if
the Agent has accelerated the maturity of the Obligations as a result of an
Event of Default; provided further, however, that immediately after giving
effect to each Advance, the Dollar Value of Total Canadian Utilization shall not
exceed the Total Canadian Revolving Credit Commitment. Within such limits, TD
Canada may borrow, repay and reborrow hereunder, on a Business Day, from the
Closing Date until, but (as to borrowings and reborrowings) not including, the
Revolving Credit Termination Date; provided, however, that (x) no Eurodollar
Rate Loan or Acceptance shall be made which has an Interest Period or maturity
that extends beyond the Revolving Credit Termination Date and (y) each
Eurodollar Rate Loan may, subject to the provisions of Section 3.08, be repaid
only on the last day of the Interest Period with respect thereto. TD Canada
agrees that if at any time the Total Canadian Utilization shall exceed the Total
Canadian Revolving Credit Commitment, TD Canada shall immediately reduce the
outstanding Canadian Loans such that, as a result of such reduction, the Total
Canadian Revolving Credit Commitment shall equal or exceed the Total Canadian
Utilization.
CIBC agrees to establish in favor of TD Canada an overdraft facility
in the amount of U.S. $5,000,000 to be utilized by TD Canada for working capital
and general corporate needs of TD Canada. This overdraft facility may be availed
by way of Canadian Prime Rate Loans and Domestic Base Rate Loans. Utilizations
of this overdraft facility will constitute Canadian Loans and be included in
Total Canadian Utilization.
(b) Amounts, Advances and Rate Selection. (i) Each request for a
Canadian Advance of the Alternative Currency under a Borrowing Notice shall
constitute TD Canada's request for a Canadian Loan of the Dollar Value of the
amount of the Alternative Currency specified in such Borrowing Notice and for
such Canadian Loan to be made available by the Canadian Facilities Lenders to TD
Canada in the Alternative Currency Equivalent Amount of such Dollar
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Value (determined based on the Advance Date Exchange Rate applicable to such
Canadian Advance). The principal amount outstanding on any Canadian Loan shall
be recorded in the Canadian Agent's records in Dollars (in the case of a
Canadian Advance of the Alternative Currency as if the Canadian Loan had
initially been made in Dollars), based on the amount of any Canadian Advance and
on the Dollar Value of the initial Canadian Advance of the Alternative Currency,
as reduced from time to time by the Dollar Equivalent Amount (based on the
Advance Date Exchange Rate applicable to such Advance) of any principal payments
with respect to such Advance. In the event a Eurodollar Rate Loan of the
Alternative Currency is continued such election to continue the Eurodollar Rate
Loan shall be treated as a Canadian Advance and the Canadian Agent shall notify
TD Canada and the Canadian Facilities Lenders of the Advance Date Exchange Rate,
Interest Period and the Eurodollar Rate for such continued Eurodollar Rate Loan.
The Canadian Facilities Lenders shall each be deemed to have made a Canadian
Advance to TD Canada of its Applicable Commitment Percentage of such Canadian
Loan of the Alternative Currency and the Canadian Agent shall apply the Advance
Date Exchange Rate for such new Interest Period to such continued Alternative
Currency Equivalent Amount to determine the new Dollar Value of such Eurodollar
Rate Loan and shall adjust its books accordingly. In the event that such
adjustment with respect to a continued Canadian Loan would cause the total
Dollar Value of the outstanding Canadian Loans to exceed the Total Canadian
Revolving Credit Commitment, TD Canada shall, immediately on the effective date
of such continuation, repay (a "Rate Adjustment Payment") the portion of such
converted Loan (applying the new Advance Date Exchange Rate) necessary to ensure
that the total Dollar Value of the outstanding Canadian Loans does not exceed
the Total Canadian Revolving Credit Commitment, provided further that TD Canada
shall not be required to pay any additional compensation pursuant to Section
4.04 with respect to a prepayment of a Canadian Loan required by this sentence
if such prepayment is made immediately on the effective date of the continuation
giving rise to such prepayment. For the purposes of determining the maximum
amount of the outstanding Canadian Loans that may exist hereunder, it is
intended by the parties that all Loans shall be the functional equivalent of
Loans made and repaid (based on the applicable Advance Date Exchange Rate for
each Canadian Advance) in Dollars. It is recognized that Canadian Facilities
Lenders may elect to record Canadian Loans or Canadian Advances in Alternative
Currencies. The Canadian Agent shall maintain records sufficient to identify at
any time, (i) the Advance Date Exchange Rate with respect to each Canadian
Advance, and (ii) the portion of the total outstanding Canadian Loans
attributable to each Canadian Advance. Total Canadian Utilization by TD Canada
shall be permitted to exceed the Total Canadian Revolving Credit Commitment by
up to 5% by reason of changes in the Spot Rate of Exchange, calculated by CIBC
on a daily basis, however, should the Total Canadian Utilization by TD Canada
exceed the Total Canadian Revolving Credit Commitment by an amount equal to or
greater than 5% then TD Canada shall either (i) reduce the
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Canadian Loans upon the next maturity, continuance or conversion of a Canadian
Acceptance or Eurodollar Rate Loan or maturity of a Canadian Letter of Credit
and provide to the Canadian Agent funds in Dollars equal to the amount in excess
of the Total Canadian Revolving Credit Commitment, which Funds will be held by
the Canadian Agent as security for such excess or (ii) repay Canadian Loans
immediately such that, as a result of such repayment, the Total Canadian
Revolving Credit Commitment shall equal or exceed the Total Canadian
Utilization.
(ii) The aggregate unpaid amount (including with respect to Loans of
the Alternative Currency the total Dollar Value) of the Canadian Loans plus
Canadian Letter of Credit Outstandings and Canadian Acceptance Usage shall not
exceed at any time an amount equal to the Total Canadian Revolving Credit
Commitment. Each Loan and each conversion under Section 3.01 shall be (A) in the
case of Eurodollar Loans, in an amount not less than $1,000,000 and in integral
multiples of $500,000 (or the equivalent thereof in the Alternative Currency),
and (B) in the case of Canadian Prime Rate Loan or Domestic Base Rate Loan in an
amount not less than $500,000, and, if greater, an integral multiple of $100,000
(or the equivalent thereof in the Alternative Currency).
(iii) An Authorized Representative of TD Canada shall give the
Canadian Agent at least (A) three (3) Business Days irrevocable telecopy or
telex notice of each Eurodollar Rate Loan (whether representing an additional
borrowing hereunder or the conversion of borrowing hereunder) or each Canadian
Acceptance which the Borrower wants to be accepted prior to 10:30 A.M., Toronto,
Canada time and, (B) irrevocable telephonic or telefacsimile notice of each
Canadian Acceptance, Canadian Prime Rate Loan or Domestic Base Rate Loan
representing a borrowing or conversion hereunder prior to 10:30 A.M. Toronto,
Canada time on the day before such proposed Canadian Prime Rate Loan or Domestic
Base Rate Loan. Each such Borrowing Notice, which shall be effective upon
receipt by the Canadian Agent, shall specify the type of Canadian Loan
(Eurodollar Rate, Canadian Prime Rate, Canadian Acceptance or Domestic Base
Rate), whether Dollar or the Alternative Currency, the amount of the Canadian
Loan for which the Canadian Advance is to be made, the date of borrowing and
where applicable the Interest Period to be used in the computation of interest.
The Authorized Representative shall provide the Canadian Agent written
confirmation of each such telephonic notice on the same day by telefacsimile
transmission in the form of a Borrowing Notice in the form attached hereto as
Exhibit D-2, in each case with appropriate insertions, but failure to provide
such confirmation shall not affect the validity of such telephonic notice. The
duration of the initial Interest Period for each Canadian Loan shall be as
specified in the initial Borrowing Notice. TD Canada shall have the option to
elect the duration of subsequent Interest Periods and to convert the Loans in
accordance with Section 3.08 hereof. If the Canadian Agent does not receive a
notice of election of duration of an Interest Period or to convert by the time
prescribed hereby and in accordance with
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Section 3.08 hereof, TD Canada shall be deemed to have elected a Domestic Base
Rate Loan in the case of Eurodollar Rate Loans or Canadian Prime Rate Loans for
Canadian Acceptances.
(iv) Notice of receipt of each Borrowing Notice shall be provided by
the Canadian Agent to each Canadian Facilities Lender by telecopy or telex with
reasonable promptness, but not later than 12:00 noon, Toronto, Canada time on
the same day as the Canadian Agent's receipt of such notice from TD Canada prior
to 10:30 A.M., Toronto, Canada time. At approximately 10:00 A.M. Toronto,
Ontario time two (2) Business Days preceding the date specified for an Advance
of the Alternative Currency, the Canadian Agent shall determine the Advance Date
Exchange Rate and the Applicable Rate. Not later than 11:00 A.M. Toronto, Canada
time on the date specified for each Advance of the Alternative Currency, the
Agent shall provide TD Canada and each Canadian Facilities Lender notice by
telefacsimile transmission of the Advance Date Exchange Rate applicable to such
Canadian Advance, and the Alternative Currency Equivalent Amount of the Canadian
Loan or Loans required to be made by each Canadian Facilities Lender on such
date, and the Dollar Value of such Loan or Loans and the Applicable Rate.
(v) In the case of Canadian Advances in Dollars, each Canadian
Facilities Lender shall, pursuant to the terms and conditions of this Agreement,
not later than 12:00 noon, Toronto, Canada time on the date specified for such
Advance, make the amount of the Canadian Advance to be made by it on such day
available to the Canadian Agent by depositing or transferring the proceeds
thereof in immediately available funds to the Canadian Agent, at its Funding
Bank. The amount so received by the Canadian Agent shall, subject to the terms
of this Agreement, be made available to TD Canada by deposit of the proceeds to
an account of TD Canada maintained at such Funding Bank or otherwise as shall be
directed in the applicable Borrowing Notice.
(vi) In the case of Canadian Advances of the Alternative Currency,
not later than 11:00 A.M., Toronto, Canada time on the date specified for each
Advance, each Canadian Facilities Lender shall, pursuant to the terms and
subject to the conditions of this Agreement, make the amount of the Canadian
Loan or Loans to be made by it on such day available to TD Canada at the
Canadian Agent, to the account of the Canadian Agent. The amount so received by
the Canadian Agent shall, subject to the terms and conditions of the Loan
Documents on the same day but no later than 12:00 noon Toronto, Canada time, be
made available to TD Canada by delivery of the Alternative Currency Equivalent
Amount to TD Canada's account with the Canadian Agent.
(vii) Notwithstanding the foregoing, if a drawing is made under any
Canadian Letter of Credit prior to the Revolving Credit Termination Date and TD
Canada shall not immediately reimburse CIBC for the amount of such draw or
payment, then notice of such drawing or payment shall be provided promptly by
CIBC to the Canadian Agent
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and the Canadian Agent shall provide notice to each Canadian Facilities Lender
by telephone or telefacsimile. If notice to the Canadian Facilities Lenders of a
drawing under any Letter of Credit is given by the Canadian Agent at or before
12:00 noon Toronto, Canada time on any Business Day, such drawing shall be
converted to Dollars at the Spot Rate of Exchange on the date of drawing under
the Canadian Letter of Credit, TD Canada shall be deemed to have requested, and
each Canadian Facilities Lender shall, pursuant to the conditions of this
Agreement, make a Domestic Base Rate Loan under the Canadian Revolving Credit
Facility in the amount of such Canadian Facilities Lender's Applicable
Commitment Percentage of such drawing or payment (and in the case of a drawing
in the Alternative Currency, a Canadian Prime Rate Loan in an amount equal to
such Canadian Facilities Lender's Applicable Commitment Percentage of the Dollar
Equivalent Amount of such drawing or payment determined on the basis of the Spot
Rate of Exchange on the date of drawing under the Canadian Letter of Credit) and
shall pay such amount to the Canadian Agent for the account of CIBC at the
Lending Office in Dollars and in immediately available funds before 2:30 P.M.
Toronto, Canada time on the same Business Day. If notice to the Canadian
Facilities Lenders is given by the Canadian Agent after 12:00 noon Toronto,
Canada time on any Business Day, such drawing shall be converted to Dollars at
the Spot Rate of Exchange on the date of drawing under the Canadian Letter of
Credit, TD Canada shall be deemed to have requested, and each Canadian
Facilities Lender shall, pursuant to the terms and subject to the conditions of
this Agreement, make a Canadian Prime Rate Loan under the Canadian Revolving
Credit Facility in the amount of such Canadian Facilities Lender's Applicable
Commitment Percentage of such drawing or payment and shall pay such amount to
the Canadian Agent for the account of CIBC at the Principal Office in Dollars
and in immediately available funds before 12:00 noon Toronto, Canada time on the
next following Business Day. Such Domestic Base Rate Loan shall continue unless
and until TD Canada converts such Domestic Base Rate Loan in accordance with the
terms of Section 3.08 hereof.
3.02 Payment of Interest. (a) TD Canada shall pay interest to the
Canadian Agent for the account of each Canadian Facilities Lender on the
outstanding and unpaid principal amount of each Canadian Loan made by such
Canadian Facilities Lender for the period commencing on the date of such
Canadian Facilities Loan until such Canadian Loan shall be due at the then
applicable Domestic Base Rate for Domestic Base Rate Loans, the Canadian Prime
Rate for Canadian Prime Rate Loans or applicable Eurodollar Rate for Eurodollar
Rate Loans, such payments to be made in Dollars or at the Applicable Rate in the
case of Canadian Loans made in the Alternative Currency, such payments to be
made in the Alternative Currency as designated by the Authorized Representative
pursuant to Section 3.01 hereof or as otherwise provided herein; provided,
however, that if any amount shall not be paid when due (at maturity, by
acceleration or otherwise), all amounts outstanding hereunder shall bear
interest thereafter (i) in the case of a
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Eurodollar Rate Loan, until the end of the Interest Period with respect to such
Eurodollar Rate Loan, at a rate of two percent (2%) above such Eurodollar Rate
and (ii) thereafter, and with respect to Domestic Base Rate Loans or Canadian
Prime Rate Loans, at a rate of interest per annum which shall be two percent
(2%) above the Domestic Base Rate or Canadian Prime Rate, as the case may be, or
the maximum rate permitted by applicable law, whichever is lower, from the date
such amount was due and payable until the date such amount is paid in full.
The Canadian Agent's certificate as to each rate of interest payable
hereunder shall be prima facie evidence of such rate.
(b) Computation of Interest. TD Canada shall pay to the Canadian
Agent for the benefit of the Canadian Facilities Lenders interest on each
Canadian Loan, which interest shall be calculated on the outstanding principal
amount daily for the period:
(i) in the case of a Canadian Prime Rate Loan or a Domestic Base
Rate Loan, commencing on and including the day on which it is
advanced and ending on, but excluding, the day on which it is repaid;
or
(ii) in the case of a Eurodollar Rate Loan, commencing on and
including the first day of the Interest Period relative to such
Eurodollar Rate Loan and ending on, but excluding, the last day of
such Interest Period,
at the rate of interest per annum equal to, in the case of:
(i) the Canadian Prime Rate for Canadian Prime Rate
Loans, on the basis of a year of 365 days;
(ii) the Domestic Base Rate for Domestic Base Rate Loans,
on the basis of a year of 365 days;
(iii) the Eurodollar Rate for Eurodollar Rate Loans, on the basis
of a year of 360 days.
For the purposes of this Agreement, whenever interest is calculated on the basis
of a year of 360 or 365 days, each rate of interest determined pursuant to such
calculation expressed as an annual rate for the purposes of the Interest Act
(Canada) is equivalent to such rate as so determined multiplied by the number of
days in the calendar year in which the same is to be ascertained and divided by
360 or 365, as appropriate. The parties further agree that for the purposes of
the Interest Act (Canada), (i) the principle of deemed reinvestment of interest
shall not apply to any interest calculation under this Agreement, and (ii) the
rates of interest stipulated in this Agreement are intended to be nominal rates
and not effective rates or yields.
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Interest on each Canadian Loan shall be paid on the last day of the
applicable Interest Period for each Eurodollar Rate Loan and, if the Interest
Period extends for more than three months, at intervals of three months after
the first day of the Interest Period and on the Revolving Credit Termination
Date.
(c) Accrual and Payment of Interest. Interest on each
Canadian Loan shall accrue from day to day but shall not compound
and shall be payable:
(i) in the case of a Canadian Prime Rate Loan, Domestic Base
Rate Loan or any other amount payable hereunder other than in respect
of a Eurodollar Rate Loan, monthly in arrears on the first Banking
Day of each month; or
(ii) in the case of a Eurodollar Rate Loan, as set forth
in Section 3.02(b).
3.03 Payment of Principal. (a) The principal amount of each Canadian
Loan shall be due and payable to the Agent for the benefit of each Canadian
Facilities Lenders in full on the Revolving Credit Termination Date. The
duration of the initial Interest Period for each Canadian Loan that is a
Eurodollar Rate Loan or Canadian Acceptance shall be as specified in the initial
Borrowing Notice. TD Canada shall have the option to elect the duration of
subsequent Interest Periods and to convert the Loans in accordance with Section
3.08 hereof. If the Canadian Agent does not receive a notice of election of
duration of an Interest Period or to convert by the time prescribed by Section
3.08 hereof, TD Canada shall be deemed to have elected to convert such Canadian
Loan to (or continue such Canadian Loan as) a Canadian Prime Rate Loan or
Domestic Base Rate Loan, as applicable, until TD Canada notifies the Agent in
accordance with Section 3.08.
(b) Each payment of principal (including any prepayment) shall be
made to the Canadian Agent at its Lending Office, for the account of each
Canadian Facilities Lender's applicable Lending Office, to be recorded in
Dollars as set forth in Section 3.01(b). The principal amount attributable to
each specified Advance of the Alternative Currency (or the continuation or
conversion thereof) (as determined from the Canadian Agent's records) shall be
repaid in the Alternative Currency. Each such payment shall be made in
immediately available funds before 12:30 P.M. Toronto, Canada time on the date
such payment is due. The Canadian Agent may, but shall not be obligated to,
debit the amount of any such payment which is not made by such time to any
ordinary deposit account, if any, of TD Canada with the Canadian Agent. TD
Canada shall give the Canadian Agent prior telephonic notice of any payment of
principal, such notice to be given by not later than 11:00 A.M. Toronto, Canada
time, prior to the date of such payment. Each repayment shall be effected in the
currency of the outstanding Advance.
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(c) The Canadian Agent shall deem any payment by or on behalf of TD
Canada hereunder that is not made both (a) in Dollars in the case of Eurodollar
Rate Loans made in Dollars or Domestic Base Rate Loans and the Alternative
Currency in the case of Canadian Loans in the Alternative Currency and in
immediately available funds and (b) prior to 12:30 P.M. Toronto, Canada time to
be a non-conforming payment. Any such payment shall not be deemed to be received
by the Canadian Agent until the time such funds become available funds. The
Canadian Agent shall give prompt telephonic notice to the applicable Authorized
Representative and each of the Canadian Facilities Lenders (confirmed in
writing) if any payment is non-conforming. Interest shall continue to accrue on
any principal as to which a non-conforming payment is made until such funds
become available funds (but in no event less than the period from the date of
such payment to the next succeeding Business Day) at a rate of interest per
annum which shall be two percent (2%) above the Canadian Prime Rate or Domestic
Base Rate, as the case may be, or the maximum rate permitted by applicable law,
whichever is lower, from the date such amount was due and payable until the date
such amount is paid in full.
(d) In the event that any payment hereunder or under the Canadian
Loans which bear interest at the Domestic Base Rate or Canadian Prime Rate
becomes due and payable on a day other than a Business Day, then such due date
shall be extended to the next succeeding Business Day; provided that interest
shall continue to accrue during the period of any such extension.
3.04 Evidence of Indebtedness. TD Canada hereby authorizes each
Canadian Facilities Lender and the Canadian Agent to record, from time to time,
in its records, the date and amount of each Canadian Loan; the interest rates
payable by TD Canada in respect of each Canadian Loan and any Interest Period
applicable thereto; the Canadian Acceptances issued in respect of any Canadian
Loan; the dates and amounts of all payments received by such Canadian Facilities
Lender on account of principal, interest and fees; and the amount of all the
Canadian Loans which remain payable by TD Canada to such Canadian Facilities
Lender. All amounts and other information so recorded shall be prima facie
evidence thereof. The failure to record, or any error in recording, any such
amount or other information shall not limit or impair the obligations of TD
Canada hereunder or under any Loan Document.
3.05 Pro Rata Payments. Except as otherwise provided herein, (a) each
payment on account of the principal of and interest on the Loans and the fees
described in Section 3.09 hereof shall be made to the Canadian Agent for the
account of the Canadian Facilities Lenders pro rata based on their Applicable
Commitment Percentages, (b) all payments to be made by TD Canada for the account
of each of the Canadian Facilities Lenders on account of principal, interest and
fees, shall be made without set-off or counterclaim, and (c) the Canadian Agent
in all other cases will promptly distribute payments received to the Canadian
Facilities Lenders.
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Notwithstanding the foregoing, in the event any Canadian Facilities Lender shall
not be able to make a Eurodollar Rate Loan as provided in Section 3.01, interest
shall be allocated to such Canadian Facilities Lender according to the interest
rate payable to such Canadian Facilities Lender as set forth in Section 4.05.
3.06 Reductions. TD Canada shall, by notice from an Authorized
Representative, have the right from time to time (but not more frequently than
once during each fiscal quarter), upon not less than ten (10) Business Days
written notice to the Canadian Agent to reduce the Total Canadian Revolving
Credit Commitment. The Canadian Agent shall give each Canadian Facilities
Lender, within one (1) Business Day, telephonic notice (confirmed in writing) of
such reduction. Each such reduction shall be in the aggregate amount of
$5,000,000 or such greater amount which is in an integral multiple of
$1,000,000, and shall permanently reduce the Total Canadian Revolving Credit
Commitment of the Canadian Facilities Lenders pro rata. No such reduction shall
result in the payment of any Eurodollar Rate Loan other than on the last day of
the Interest Period of such Canadian Loan unless such prepayment is accompanied
by amounts due, if any, under Section 4.04. Each reduction of the Total Canadian
Revolving Credit Commitment shall be accompanied by payment of the Canadian
Facilities Notes to the extent that the Total Canadian Utilization exceeds the
Total Canadian Revolving Credit Commitment, after giving effect to such
reduction, together with accrued and unpaid interest on the amounts prepaid.
3.07 Increase and Decrease in Amounts. The amount of the Total
Canadian Revolving Credit Commitment which shall be available to TD Canada shall
be reduced by the aggregate amount of all Canadian Letters of Credit
Outstandings and Canadian Acceptance
Usage.
3.08 Conversions and Elections of Subsequent Interest Periods.
Provided that no Default or Event of Default shall have occurred and be
continuing and subject to the limitations set forth below and in Sections
4.01(b), 4.02 and 4.03 hereof, TD Canada may, by delivering the Borrowing Notice
set out in Exhibit D-2, request a conversion or continuance provided that:
(a) the proceeds are used to retire the Outstanding
Loan;
(b) the notice identifies the outstanding Loan to be
retired (the "Outstanding Loan");
(c) the conversion or continuance would otherwise be a
permitted Advance hereunder and TD Canada and TDC comply with each
provision hereof relative to the obtaining of an Advance;
(d) the aggregate principal amount of the conversion or
continuance is not greater than the Outstanding Loan plus
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accrued interest in the case of Eurodollar Rate Loans rounded
up to the nearest $10,000;
(e) no conversions shall be made from one currency to
another without first satisfying the original Obligation in
the currency of their denomination;
(f) each conversion or continuance is made
contemporaneously with the retirement of the Outstanding Loan.
Notice of any such elections or conversions shall specify the
effective date of such election or conversion and the Interest Period to be
applicable to the Canadian Loan as continued or converted.
All such continuations or conversions of Canadian Loans shall be
effected pro rata based on the Applicable Commitment Percentages of the Canadian
Facilities Lenders in respect of the Total Canadian Revolving Credit Commitment.
3.09 Unused Fee. For the period beginning on the Closing Date and
ending on the Revolving Credit Termination Date (or such earlier date on which
the Canadian Revolving Credit Facility has terminated), TD Canada agrees to pay
to the Canadian Agent, for the pro rata benefit of the Canadian Facilities
Lenders based on their Applicable Commitment Percentages, an unused fee equal to
the Applicable Unused Fee times the sum of the daily amount by which the Total
Canadian Revolving Credit Commitment exceeds the sum of average daily (i)
outstanding Canadian Loans plus (ii) Canadian Letters of Credit plus (iii)
Canadian Acceptances. Such payments of fees provided for herein shall be due in
arrears on the last Business Day of each January, April, July and October
beginning July 31, 1996 to and on the Revolving Credit Termination Date (or such
earlier date on which the Revolving Credit Facility has terminated).
Notwithstanding the foregoing, so long as any Canadian Facilities Lender fails
to make available any portion of its Canadian Revolving Credit Commitment when
requested, such Lender shall not be entitled to receive payment of its pro rata
share of such fee until such Lender shall make available such portion. Such fee
shall be calculated on the basis of a year of 365 days for the actual number of
days elapsed.
3.10 Deficiency Advances. No Canadian Facilities Lender shall be
responsible for any default of any other Canadian Facilities Lender in respect
to such other Canadian Facilities Lender's obligation to make any Canadian Loan
hereunder nor shall the Canadian Revolving Credit Commitment of any Canadian
Facilities Lender hereunder be increased as a result of such default of any
other Canadian Facilities Lender. Without limiting the generality of the
foregoing, in the event any Canadian Facilities Lender shall fail to advance
funds to TD Canada as herein provided, the Canadian Agent may in its discretion,
but shall not be obligated to, advance in its favor as a Canadian Facilities
Lender all or any portion of
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such amount or amounts (each, a "deficiency advance") and shall thereafter be
entitled to payments of principal of and interest on such deficiency advance in
the same manner and at the same interest rate or rates to which such other
Canadian Facilities Lender would have been entitled had it made such advance
hereunder; provided that, upon payment to the Canadian Agent from such other
Canadian Facilities Lender of the entire outstanding amount of each such
deficiency advance, together with accrued and unpaid interest thereon, from the
most recent date or dates interest was paid to the Canadian Agent by TD Canada
on each Canadian Loan comprising the deficiency advance at the interest rate per
annum for overnight borrowing by the Canadian Agent, then such payment shall be
credited against the applicable Obligation owed to the Canadian Agent in full
payment of such deficiency advance and TD Canada shall be deemed to have
borrowed the amount of such deficiency advance from such other Canadian
Facilities Lender as of the most recent date or dates, as the case may be, upon
which any payments of interest were made by TD Canada thereon.
3.11 Use of Proceeds. The proceeds of the Canadian Loans made
pursuant to the Canadian Revolving Credit Facility hereunder shall be used by TD
Canada to repay existing Indebtedness under the Prior Canadian Facilities
Agreement, to support issuance of Canadian Letters of Credit and Canadian
Acceptances, to finance Capital Expenditures and Permitted Acquisitions and for
other working capital and general corporate needs of TD Canada, to the extent
permitted under this Agreement.
3.12 Extension of Revolving Credit Termination Date. At the request
of TD Canada the Lenders may, in their sole discretion, elect to extend the
Revolving Credit Termination Date for Canadian Facilities then in effect for
additional periods of one year. TD Canada shall notify the Lenders of its
request for such an extension by delivering to the Agent notice of such request
signed by an Authorized Representative not more than one hundred and twenty
(120) days nor less than sixty (60) days prior to the second anniversary of the
Closing Date. If all the Lenders shall elect to so extend, the Agent shall
notify TD Canada in writing within sixty (60) days of its receipt of such
request for extension of the decision of the Lenders of whether to extend the
Revolving Credit Termination Date for Canadian Facilities. Failure by the Agent
to give such notice shall constitute refusal by the Lenders to extend the
Revolving Credit Termination Date for the Canadian Facilities.
3.13 Letters of Credit. CIBC agrees, subject to the terms and
conditions of this Agreement, to maintain the Existing Canadian Letters of
Credit as Canadian Letters of Credit hereunder and, upon request of TD Canada to
issue from time to time for the account of the TD Canada Canadian Letters of
Credit upon delivery to CIBC of a Letter of Credit Application in form and
content acceptable to CIBC; provided, that the Canadian Letter of Credit
Outstandings hereunder shall not exceed the Canadian Letter of Credit
Commitment. No Canadian Letter of Credit shall be issued by CIBC
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with an expiry date or payment date occurring subsequent to the thirtieth
Business Day preceding the Revolving Credit Termination Date and no Commercial
Letter of Credit shall have an expiry date occurring more than six (6) months
after the date of its issuance. CIBC shall not be required to issue any Canadian
Letter of Credit if the Total Canadian Utilization when added to the face amount
of any requested Canadian Letter of Credit exceeds the Total Canadian Revolving
Credit Commitment.
3.14 Acceptances.
(a) Creation of Canadian Acceptances. Upon receipt of a Borrowing
Notice given in accordance with this Agreement and subject to the provisions of
this Agreement, each Canadian Facilities Lender severally agrees to accept from
time to time such Canadian Dollar bills of exchange as TD Canada shall request
within the scope of the Total Canadian Revolving Credit Commitment, provided
that:
(i) Canadian Acceptances shall be issued on a Business
Day specified in the Borrowing Notice;
(ii) each Canadian Acceptance shall have a term from 30 to 180
days (excluding days of grace), as designated by TD Canada in the
relevant Borrowing Notice, provided that each Canadian Acceptance
shall mature on a Business Day and TD Canada shall choose Canadian
Acceptances of such duration so as to ensure that TD Canada complies
in all respects with its reduction or repayment obligations under
this Agreement; and
(iii) each Canadian Acceptance shall be in a form acceptable to the
Canadian Facilities Lenders acting reasonably.
The obligation of the Canadian Facilities Lenders to accept bills of exchange
shall be several and not joint, and the failure of any Canadian Facilities
Lender to accept any bills of exchange shall not relieve any other Canadian
Facilities Lender of its obligation to accept bills of exchange in accordance
with the terms hereof, and no Canadian Facilities Lender shall be responsible
for the failure by any other Canadian Facilities Lender to accept bills of
exchange to be accepted by such other Canadian Facilities Lender.
(b) Notice by Canadian Agent to Canadian Facilities Lenders. The
Canadian Agent shall give prompt written notice to the Canadian Facilities
Lenders of each Borrowing Notice requesting the issue of Canadian Acceptances
and shall notify each Canadian Facilities Lender of the face amount at maturity
of each bill of exchange to be accepted by such Canadian Facilities Lender based
upon such Canadian Facilities Lender's pro rata share based on their Applicable
Commitment Percentage of the face amount of Canadian Acceptances specified in
the Borrowing Notice, except that, if the face amount of a Canadian Acceptance
would not be Cdn $100,000 or
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a whole multiple thereof, the face amount may be increased or reduced by the
Canadian Facilities Lender in its sole discretion without thereby increasing or
reducing the aggregate face amount at maturity of the Canadian Acceptances to be
accepted by the Canadian Facilities Lenders as specified in the Borrowing
Notice.
(c) Stamping Fees. Upon tendering any bill of exchange for acceptance
by a Canadian Facilities Lender pursuant to the Canadian Revolving Credit
Facility, TD Canada shall pay to such Canadian Facilities Lender, a fee equal to
the Credit Margin then in effect relating to Canadian Acceptances to be accepted
pursuant to the Canadian Revolving Credit Facility, based on the principal
amount of such bill of exchange for the duration of its stated term calculated
on the basis of the actual number of days in the stated term, commencing on, and
including, the date such Canadian Facilities Lender accepts the bill of exchange
and ending on, but excluding, its stated payment date.
(d) Pre-Signed Acceptances. TD Canada shall deliver to the Canadian
Facilities Lenders sufficient pre-signed bills of exchange, in form acceptable
to the Canadian Facilities Lenders or such other instrument as may reasonably be
required by a Canadian Facilities Lender and acceptable to TD Canada, to enable
the Canadian Facilities Lenders to meet requests by TD Canada for Canadian
Advances by way of Canadian Acceptances from time to time. The Canadian
Facilities Lenders shall not be responsible or liable for their failure to
accept a Canadian Acceptance as required hereunder if the cause of such failure
is, in whole or in part, due to the failure of TD Canada to provide duly
executed and endorsed drafts to the Canadian Facilities Lenders on a timely
basis nor shall the Canadian Facilities Lenders be liable for any damage, loss
or other claim arising by reason of any loss or improper use of any such
instrument except the negligence or willful misconduct of the Canadian
Facilities Lenders or their employees. Each of the Canadian Facilities Lenders
shall maintain a record with respect to Canadian Acceptances (i) received by it
from TD Canada in blank hereunder, (ii) voided by it for any reason, (iii)
accepted by it hereunder, and (iv) cancelled at their respective maturities. The
Canadian Facilities Lenders further agree to retain such records in the manner
and for the statutory periods provided in the various provincial or federal
statutes and regulations which apply to the Canadian Facilities Lenders. Such
pre-signed bills of exchange shall be blank as to date of issue, date of
maturity and amount. With respect to the safekeeping of pre-signed bills of
exchange delivered to the Canadian Facilities Lenders by TD Canada, the Canadian
Facilities Lenders shall be obligated to exercise only the same degree of care
as if such Canadian Acceptances were the property of the Canadian Facilities
Lenders and the Canadian Facilities Lenders were keeping them at the place at
which they are held. The Canadian Facilities Lenders may complete and accept
presigned bills of exchange from time to time in accordance with the
instructions of TD Canada, provided that the Canadian Facilities Lenders shall
not incur any liability whatsoever in respect of
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instructions carried out by them in the belief that such instructions were
properly given by TD Canada.
(e) Execution of Acceptances. Bills of exchange of TD Canada to be
accepted as Canadian Acceptances hereunder shall be signed by an Authorized
Representative of TD Canada. Notwithstanding that any person whose signature
appears on any Canadian Acceptance as one of such officers may no longer be an
authorized signatory for TD Canada at the date of issuance of a Canadian
Acceptance, such signature shall nevertheless be valid and sufficient for all
purposes as if such authority had remained in force at the time of such issuance
and any such Canadian Acceptance so signed shall be binding on TD Canada.
(f) Payment of Discount Proceeds. On the date set forth in
Section 3.01, each Canadian Facilities Lender will pay to TD Canada
the Acceptance Discount Proceeds relating to the Canadian
Acceptances accepted by it.
The Canadian Facilities Lenders may at any time and from time to time
hold, sell, rediscount or otherwise dispose of any or all Canadian Acceptances
purchased by them.
(g) Discharge of Acceptances. TD Canada agrees that on each date on
which a Canadian Acceptance matures (in this Section, a "maturity date"), unless
TD Canada is entitled to a Canadian Advance under Section 3.01 or TD Canada has
requested and is entitled to a conversion in the amount of the maturing Canadian
Acceptance TD Canada will provide the Canadian Agent for the benefit of the
Canadian Facilities Lenders before 10:00 a.m. (Toronto Time) with immediately
available funds (in this Section, the "discharge funds") to discharge in full
the liabilities of the Canadian Facilities Lenders in respect of such Canadian
Acceptance. TD Canada shall not claim any days of grace for the payment of
maturity of any Canadian Acceptance. If TD Canada does not in fact provide the
Canadian Agent with the discharge funds and is not entitled to an Advance or a
conversion in the amount of the maturing Canadian Acceptance, the Canadian
Facilities Lenders may (but shall not be obliged to) make a Canadian Loan to TD
Canada, which Canadian Loan TD Canada hereby requests the Canadian Facilities
Lenders to make and which, if made, shall be made on a demand basis and shall
bear interest at the Canadian Prime Rate as varied from time to time plus 2% per
annum. To the extent not inconsistent with the demand nature of this loan, the
terms and conditions of this Agreement pertinent to a Canadian Prime Rate Loan
outstanding under the Canadian Revolving Credit Facilities shall apply to such
demand loan. This provision applies whether or not a Canadian Facilities Lender
is the holder of the maturing Canadian Acceptance.
(h) Acceptances Outstanding Upon Default. If any Canadian Acceptance
is outstanding upon the occurrence of an Event of Default, TD Canada
shall forthwith upon demand by the Canadian
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Agent pay to the Canadian Agent for the benefit of the Canadian Facilities
Lenders an amount equal to the principal amount of all such Canadian Acceptances
such amount to be held by the Canadian Agent for application against the
Indebtedness owing by TD Canada to the Canadian Facilities Lenders in respect of
such Canadian Acceptances or in respect of any other amount payable under the
Canadian Loan Documents.
(i) Obligations Unconditional. The obligations of TD Canada with
respect to Canadian Acceptances under this Section 3.14 shall be unconditional
and irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including, without limitation, the following
circumstances:
(i) any lack of validity or enforceability of any bill
of exchange accepted by the Canadian Facilities Lenders as a
Canadian Acceptance; and
(ii) the existence of any claim, set off, defense or other right
which TD Canada may have at any time against the holder of a Canadian
Acceptance, or any other Person, whether in connection with this
Agreement or otherwise.
(j) Non-Acceptance Lenders. Notwithstanding any provision of this
Section 3.14 to the contrary, if a Canadian Facilities Lender is a
Non-Acceptance Lender and if TD Canada wishes to obtain an Advance by way of
Canadian Acceptances, such Canadian Facilities Lender shall, in lieu of
accepting Canadian Acceptances, pay to TD Canada on the date in Section 3.01 and
on the terms and conditions of this Agreement the same amount of money in
Canadian Dollars that it would have paid to TD Canada pursuant to Section
3.14(f) hereof if it had been a Canadian Facilities Lender that is not a
Schedule I chartered bank, and such Canadian Non-Acceptance Lender shall be
entitled to a stamping fee in respect thereof equal to the amount and at the
same time that it would be entitled to receive if it was a Canadian Acceptance
Lender. Upon such payment being made to TD Canada by such Canadian
Non-Acceptance Lender, it shall for all purposes be deemed to have accepted a
Canadian Acceptance hereunder.
3.15 Reimbursement.
(a) TD Canada hereby unconditionally agrees immediately
to pay to CIBC on demand at its Lending Office all amounts required to pay all
drafts drawn or purporting to be drawn under the Canadian Letters of Credit and
any and all expenses of every kind incurred by CIBC in connection with the
Canadian Letters of Credit and in any event and without demand to place in the
possession of CIBC (which shall include Canadian Advances under the Canadian
Revolving Credit Facility if permitted by Section 3.01(b)(vii) hereof)
sufficient funds to pay all debts and liabilities arising under any Canadian
Letter of Credit. TD Canada's obligations to
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pay CIBC under this Section 3.15, and the right of CIBC to receive the same,
shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever. CIBC may charge any account TD Canada may have with
CIBC for any and all amounts CIBC pays under a Canadian Letter of Credit;
provided that to the extent permitted by Section 3.01(b)(vii), amounts shall be
paid pursuant to Canadian Advances under the Canadian Revolving Credit Facility.
TD Canada agrees that CIBC may, in its sole discretion, accept or pay, as
complying with the terms of any Canadian Letter of Credit, any drafts or other
documents otherwise in order which may be signed or issued by an administrator,
executor, trustee in bankruptcy, debtor in possession, assignee for the benefit
of creditors, liquidator, receiver, attorney in fact or other legal
representative of a party who is authorized under such Canadian Letter of Credit
to draw or issue any drafts or other documents. TD Canada agrees to pay CIBC
interest on any amounts not paid when due hereunder at the Canadian Prime Rate
plus two percent (2%), or such lower rate as may be required by law.
(b) In accordance with the provisions of Section
3.01(b)(vii) hereof, CIBC shall notify the Canadian Agent (and shall also notify
TD Canada) of any drawing under any Canadian Letter of Credit issued for the
account of TD Canada as promptly as practicable following the receipt by CIBC of
such drawing.
(c) Each Canadian Facilities Lender (other than CIBC)
shall automatically acquire on the date of issuance thereof, a Participation in
the liability of CIBC in respect of each Canadian Letter of Credit in an amount
equal to such Canadian Facilities Lender's Applicable Commitment Percentage of
such liability, and to the extent that TD Canada is obligated to pay CIBC under
Section 3.16(a), each Canadian Facilities Lender (other than CIBC) thereby shall
absolutely, unconditionally and irrevocably assume, and shall be unconditionally
obligated to pay to CIBC as hereinafter described, its Applicable Commitment
Percentage (determined in respect of the Total Canadian Revolving Credit
Commitment) of the liability of CIBC under such Canadian Letter of Credit. Prior
to the Revolving Credit Termination Date, each Canadian Facilities Lender
(including CIBC in its capacity as a Canadian Facilities Lender) shall, subject
to the terms and conditions of this Article III, make a Canadian Prime Rate Loan
to TD Canada by paying to the Canadian Agent for the account of CIBC at the
Lending Office in Dollars and in immediately available funds, an amount equal to
its Applicable Commitment Percentage (determined in respect of the Total
Canadian Revolving Credit Commitment) of any drawing under a Canadian Letter of
Credit, all as described and pursuant to Section 3.01(b)(vii). With respect to
drawings under any of the Canadian Letters of Credit, each Canadian Facilities
Lender, upon receipt from the Canadian Agent of notice of a drawing in the
manner described in Section 3.01(b)(vii), shall promptly pay to the Canadian
Agent for the account of CIBC, prior to the applicable time set forth in Section
3.01(b)(vii), its Applicable Commitment Percentage (determined in respect of the
Total Canadian Revolving
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Credit Commitment) of such drawing or payment. Simultaneously with the making of
each such payment by a Canadian Facilities Lender to CIBC, such Canadian
Facilities Lender shall, automatically and without any further action on the
part of CIBC or such Canadian Facilities Lender, acquire a Participation in an
amount equal to such payment (excluding the portion thereof constituting
interest accruing before such Canadian Facilities Lender made such payment) in
the related Reimbursement Obligation of TD Canada. The Reimbursement Obligations
of TD Canada shall be immediately due and payable whether by Canadian Advances
made in accordance with Section 3.01(b)(vii) or otherwise. Each Canadian
Facilities Lender's obligation to make payment to the Canadian Agent for the
account of CIBC pursuant to this Section 3.16(c), and the right of CIBC to
receive the same, shall be absolute and unconditional, shall not be affected by
any circumstance whatsoever and shall be made without any offset, abatement,
withholding or reduction whatsoever. If any Canadian Facilities Lender is
obligated to pay but does not pay amounts to the Canadian Agent for the account
of CIBC in full upon such request as required by this Section 3.16(c), such
Canadian Facilities Lender shall, on demand, pay to the Canadian Agent for the
account of CIBC interest on the unpaid amount for each day during the period
commencing on the date of notice given to such Canadian Facilities Lender
pursuant to Section 3.01(b)(vii) until such Canadian Facilities Lender pays such
amount to the Agent for the account of CIBC in full at the interest rate per
annum for overnight borrowing by CIBC.
(d) Promptly following the (i) issuance of each Canadian
Letter of Credit and the creation of a Canadian Acceptance, CIBC shall give the
Canadian Agent written notice of the terms and conditions thereof and (ii) end
of each calendar month, CIBC shall deliver to the Canadian Agent and the Agent,
and the Canadian Agent shall deliver to each Canadian Facilities Lender, a
notice describing the aggregate undrawn amount of all Canadian Letters of Credit
accepted and outstanding at the end of such month. Upon the request of any
Canadian Facilities Lender from time to time, CIBC shall deliver to the Canadian
Agent, and the Canadian Agent shall deliver to such Canadian Facilities Lender,
any other information reasonably requested by such Canadian Facilities Lender
with respect to each Canadian Letter of Credit then outstanding.
(e) The issuance by CIBC of each Canadian Letter of
Credit and a Canadian Acceptance shall, in addition to the conditions precedent
set forth in Section 5.01 hereof, be subject to the conditions that such
Canadian Letter of Credit and Canadian Acceptance be in such form, contain such
terms and support such transactions or obligations as shall be reasonably
satisfactory to CIBC consistent with the then current practices and procedures
of CIBC with respect to similar letters of credit and acceptances. All Canadian
Letters of Credit shall be issued pursuant to and subject to the Uniform Customs
and Practice for Documentary Credits, 1993 revision, International Chamber of
Commerce Publication No. 500 and all subsequent amendments and revisions
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thereto. TD Canada shall have executed and delivered such other instruments and
agreements relating to such Canadian Letter of Credit and Canadian Acceptance as
CIBC shall have reasonably requested consistent with such practices and
procedures.
(f) Without duplication of Section 11.07 hereof, TD
Canada hereby indemnifies and holds harmless CIBC, each other Canadian
Facilities Lender and the Canadian Agent from and against any and all claims and
damages, losses, liabilities, costs or expenses which CIBC, such other Canadian
Facilities Lender or the Canadian Agent may incur (or which may be claimed
against CIBC, such other Canadian Facilities Lender or the Canadian Agent) by
any Person by reason of or in connection with the issuance or transfer of or
payment or failure to pay under any Canadian Letter of Credit or Canadian
Acceptance; provided that TD Canada shall not be required to indemnify CIBC, any
other Canadian Facilities Lender or the Canadian Agent for any claims, damages,
losses, liabilities, costs or expenses to the extent, but only to the extent,
(i) caused by the willful misconduct or gross negligence of the party to be
indemnified, (ii) caused by the failure of CIBC to pay under any Canadian Letter
of Credit or Canadian Acceptance after the presentation to it of a request
strictly complying with the terms and conditions of such Canadian Letter of
Credit or Canadian Acceptance, unless such payment is prohibited by any law,
regulation, court order or decree, or (iii) paid or payable by any Canadian
Facilities Lender under Sections 3.10 or 11.10 hereof.
(g) Without limiting TD Canada's rights as set forth in
Section 3.15(f) above, the obligation of TD Canada to immediately reimburse the
Canadian Agent or the Canadian Lenders for drawings made under Canadian Letters
of Credit or payment of Canadian Acceptances shall be absolute, unconditional
and irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement and such Canadian Letters of Credit or Canadian Acceptances,
under all circumstances whatsoever, including, without limitation, the following
circumstances:
(i) any lack of validity or enforceability of the
Canadian Letter of Credit or Canadian Acceptance, the obligation supported by
the Canadian Letter of Credit or Canadian Acceptance or any other agreement or
instrument relating thereto (collectively, the "Canadian Related Documents");
(ii) any amendment or waiver of or any consent to or
departure from all or any of the Canadian Related Documents;
(iii) the existence of any claim, setoff, defense or
other rights which TD Canada may have at any time against any beneficiary or any
transferee of a Canadian Letter of Credit or Canadian Acceptance (or any persons
or entities for whom any such beneficiary or any such transferee may be acting),
the Canadian Agent, Canadian Facilities Lenders or any other person or entity,
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whether in connection with the Loan Documents, the Canadian Related
Documents or any unrelated transaction;
(iv) any breach of contract or other dispute between
TD Canada and any beneficiary or any transferee of a Canadian Letter of Credit
or Canadian Acceptance (or any persons or entities for whom such beneficiary or
any such transferee may be acting), the Canadian Agent, Canadian Facilities
Lenders or any other person or entity;
(v) any draft, statement or any other document
presented under the Canadian Letter of Credit or Canadian Acceptance proving to
be forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect whatsoever;
(vi) any delay, extension of time, renewal,
compromise or other indulgence or modification granted or agreed to by Agent,
with or without notice to or approval by TD Canada in respect of any of TD
Canada's indebtedness under this Agreement; or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing;
provided, however, that nothing contained herein shall be deemed to release CIBC
or any other Canadian Facilities Lender of any liability for actual loss arising
as a result of its or their gross negligence or willful misconduct.
3.16 Canadian Letter of Credit Fee. (a) For the period beginning on
the Closing Date and ending on the Revolving Credit Termination Date, TD Canada
agree to pay to the Canadian Agent, for the pro rata benefit of the Canadian
Facilities Lenders based on their Applicable Commitment Percentages (determined
in respect of the Total Canadian Revolving Credit Commitment), a fee for such
period at a per annum rate equal to the Applicable Interest Addition for
Eurodollar Loans on the daily aggregate amount available to be drawn under
Canadian Standby Letters of Credit and fees for such period at those rates
established from time to time by the Canadian Agent and acceptable to Lenders
for Canadian Commercial Letters of Credit.
(b) For the period beginning on the Closing Date and
ending on the Revolving Credit Termination Date, TD Canada agrees to pay to the
Canadian Agent for the account of CIBC as issuer of the Canadian Letter of
Credit, a fee for such period at a per annum rate equal to .125% on the daily
aggregate amount available to be drawn under Canadian Letters of Credit.
(c) Such payments of fees provided for in this Section
3.16 shall be due in arrears, the first such payment to be made on the last
Business Day of July 31, 1996 and on the last Business Day of each October,
January, April and July thereafter.
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3.17 Administrative Fees and Reserves. TD Canada shall pay to CIBC
administrative and other fees, if any, in connection with the Canadian Letters
of Credit in such amounts and at such times as CIBC and TD Canada shall agree
from time to time. In addition, TD Canada shall reimburse CIBC for all costs or
reduction in yield occurring by reason of the issuance by CIBC of the Canadian
Letters of Credit.
3.18 Maximum Rate of Return. Notwithstanding any provision to the
contrary contained in this Agreement, in no event shall the aggregate "interest"
(as defined in Section 347 of the Criminal Code, Revised Statutes of Canada,
1985, C. 46 as the same may be amended, replaced or re-enacted from time to
time) payable under this Agreement exceed the effective annual rate of interest
on the "credit advanced" (as defined in that section) under this Agreement
lawfully permitted under that section and, if any payment, collection or demand
pursuant to this Agreement in respect of "interest" (as defined in that section)
is determined to be contrary to the provisions of that section, such payment,
collection or demand shall be deemed to have been made by mutual mistake of TD
Canada and the Canadian Facilities Lenders and the amount of such payment or
collection shall be refunded to TD Canada; for purposes of this Agreement the
effective annual rate of interest shall be determined in accordance with
generally accepted actuarial practices and principles over the term of the
applicable Credit on the basis of annual compounding of the lawfully permitted
rate of interest and, in the event of dispute, a certificate of a Fellow of the
Canadian Institute of Actuaries appointed by the Canadian Agent will be
conclusive for the purposes of such determination.
3.19 Reset of Canadian Lenders, Portion on Default.
Upon an Event of Default occurring hereunder, the Canadian Agent
shall determine the amount of outstanding Obligations of each of the Canadian
Facilities Lenders under the Canadian Facilities based on Applicable Commitment
Percentages (determined in respect of the Total Canadian Revolving Credit
Commitment). If at such time any Canadian Facilities Lender holds Obligations
under the Canadian Facilities in an amount less than its Applicable Commitment
Percentage, as the case may be (the "Purchasing Lender"), the Purchasing Lender
shall forthwith purchase from each Canadian Facilities Lender which holds
Obligations under the Canadian Facilities in excess of its Applicable Commitment
Percentage of the Obligations outstanding under the Canadian Facilities, as the
case may be (the "Selling Lender") the amount of the Obligations under the
Canadian Facilities from each Selling Lender required so that after such
purchase and sale, each Canadian Facilities Lender holds Obligations under the
Canadian Facilities equal to its Applicable Commitment Percentage of the Total
Canadian Revolving Credit Commitment of such Obligations. Each Selling Lender
agrees to sell such amount of such Obligations of the Canadian Facilities to the
Purchasing Lender.
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ARTICLE IV
Yield Protection and Illegality
4.01 Additional Costs. (a) Each Borrower shall promptly pay to the
Agent for the account of a Lender from time to time, such amounts as such Lender
may determine to be necessary to compensate it for any costs incurred by such
Lender which it determines are attributable to its making or maintaining any
Loan or its obligation to make any Loans, or the issuance or maintenance by
NationsBank or CIBC of or any other Lender's Participation in any Letter of
Credit and Acceptance issued hereunder, or any reduction in any amount
receivable by such Lender under this Agreement, the Notes, the Letters of Credit
or the Acceptances in respect of any of such Loans or such obligation or the
Letters of Credit or the Acceptances, including reductions in the rate of return
on a Lender's capital (such increases in costs and reductions in amounts
receivable and returns being herein called "Additional Costs"), resulting from
any Regulatory Change which: (i) changes the basis of taxation of any amounts
payable to such Lender under this Agreement or the Notes in respect of any of
such Loans or Letters of Credit or Acceptances (other than taxes imposed on the
income of such Lender by any jurisdiction in which the Principal Office or the
applicable Lending Office of such Lender is located); or (ii) imposes or
modifies any reserve, special deposit, or similar requirements relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities of, such Lender (other than any such reserve, deposit or requirement
reflected in the Domestic Base Rate, the Domestic Prime Rate, the Canadian Prime
Rate, the CD Rate or the Eurodollar Rate, in each case computed in accordance
with the respective definitions of such terms set forth in Section 1.01 hereof);
or (iii) has or would have the effect of reducing the rate of return on capital
of any such Lender to a level below that which the Lender could have achieved
but for such Regulatory Change (taking into consideration such Lender's policies
with respect to capital adequacy); or (iv) imposes any other condition adversely
affecting the Agent or the Lenders under this Agreement, the Notes or the
issuance or maintenance of, or any Lender's Participation in, the Letters of
Credit or Acceptances (or any of such extensions of credit or liabilities). Each
Lender will notify the Authorized Representative of any event occurring after
the Closing Date which would entitle it to compensation pursuant to this Section
4.01(a) as promptly as practicable after it obtains knowledge thereof and
determines to request such compensation.
(b) Without limiting the effect of the foregoing provisions of this
Section 4.01, in the event that, by reason of any Regulatory Change, any Lender
either (i) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits or other liabilities of
the Lender which includes deposits by reference to which the interest rate on CD
Loans or Eurodollar Rate Loans is determined as provided in this Agreement or a
category of extensions of credit or other assets of
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any Lender which includes CD Loans or Eurodollar Rate Loans or (ii) becomes
subject to restrictions on the amount of such a category of liabilities or
assets which it may hold, then, if the Lender so elects by notice to the other
Lenders, the obligation of such Lender to make, and to convert Domestic Base
Rate Loans, Floating CD Loans or Canadian Prime Rate Loans of any other type
into, Fixed CD Loans or Eurodollar Rate Loans, as the case may be, hereunder
shall be suspended until the date such Regulatory Change ceases to be in effect
and the Borrower shall, on the last day(s) of the then current Interest
Period(s) for outstanding Fixed CD Loans or Eurodollar Rate Loans, as the case
may be, convert such Fixed CD Loans or Eurodollar Rate Loans into Domestic Base
Rate Loans, Floating CD Loans or Canadian Prime Rate Loans or Fixed CD Loans or
Eurodollar Loans, if available hereunder, in accordance with Section 2.09 or
Section 3.08 hereof, as the case may be.
(c) Determinations by any Lender for purposes of this Section 4.01 of
the effect of any Regulatory Change on its costs of making or maintaining, or
being committed to make Loans or as to NationsBank or CIBC as issuer of any
Letter of Credit and Acceptance, the issuance or maintenance of, or any other
Lender's Participation in, any Letter of Credit and Acceptance issued hereunder,
or on amounts receivable by it in respect of Loans or Letters of Credit or
Acceptances, and of the additional amounts required to compensate the Lender in
respect of any Additional Costs, shall be conclusive absent manifest error,
provided that such determinations are made on a reasonable basis. The Lender
requesting such compensation shall furnish to the Authorized Representative an
explanation of the Regulatory Change and calculations, in reasonable detail,
setting forth such Lender's determination of any such Additional Costs.
4.02 Suspension of Loans. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of any interest rate for
any Fixed CD Loan or Eurodollar Rate Loan for any Interest Period therefor, the
Agent determines (which determination made on a reasonable basis shall be
conclusive absent manifest error) that:
(a) quotations of interest rates for the relevant deposits
referred to in the definition of "Fixed CD Rate" or "Eurodollar Rate"
in Section 1.01 hereof or foreign exchange agreements or contracts
with respect to an Alternative Currency are not being provided in the
relevant amounts or for the relevant maturities for purposes of
determining the rate of interest for such Fixed CD Loan or Eurodollar
Rate Loan as provided in this Agreement; or
(b) the relevant rates of interest referred to in the
definition of "Applicable Reference Rate" in Section 1.01 hereof upon
the basis of which the Fixed CD Rate or Eurodollar Rate for such
Interest Period is to be determined do not adequately reflect the
cost to the Lenders of making or
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maintaining such Fixed CD Loan or Eurodollar Rate Loan for such
Interest Period (which determination shall be made on a reasonable
basis and the Agent shall furnish the Borrower evidence of the facts
leading to such determination);
then the Agent shall give the Authorized Representative prompt notice thereof,
and so long as such condition remains in effect, the Lenders shall be under no
obligation to make Fixed CD Loans or Eurodollar Rate Loans, as the case may be,
or to convert Domestic Base Rate Loans, Floating CD Loans or Canadian Prime Rate
Loans into Fixed CD Loans or Eurodollar Rate Loans, as the case may be, and the
Borrower shall, on the last day(s) of the then current Interest Period(s) for
outstanding Fixed CD Loans or Eurodollar Rate Loans, as applicable, convert such
Fixed CD Loans or Eurodollar Rate Loans, into Domestic Base Rate Loans, Floating
CD Loans or Canadian Prime Rate Loans or Fixed CD Loans or Eurodollar Rate
Loans, if available hereunder, in accordance with Section 2.09 or Section 3.08
hereof, as the case may be. The Agent shall give the Authorized Representative
notice describing in reasonable detail any event or condition described in this
Section 4.02 promptly following the Agent's determination that the availability
of Fixed CD Loans or Eurodollar Rate Loans, as the case may be, is, or is to be,
suspended as a result thereof.
4.03 Illegality. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender to honor its
obligation to make or maintain Eurodollar Rate Loans hereunder, then such Lender
shall promptly notify the Borrowers thereof (with a copy to the Agent) and such
Lender's obligation to make or continue Eurodollar Rate Loans, or convert
Domestic Base Rate Loans, Floating CD Loans or Canadian Prime Rate Loans or
Fixed CD Loans into Eurodollar Rate Loans, shall be suspended until such time as
such Lender may again make and maintain Eurodollar Rate Loans, and such Lender's
outstanding Eurodollar Rate Loans shall be converted into Domestic Base Rate
Loans, Floating CD Loans or Canadian Prime Rate Loans or Fixed CD Loans in
accordance with Section 2.09 or Section 3.08 hereof, as the case may be.
4.04 Compensation. The applicable Borrower shall promptly pay to each
Lender, upon the request of such Lender, such amount or amounts as shall be
sufficient (in the reasonable determination of Lender) to compensate it for any
loss, cost or expense incurred by it as a result of:
(a) any payment, prepayment or conversion of a Fixed CD
Loan or Eurodollar Rate Loan on a date other than the last day of the
Interest Period for such Fixed CD Loan or Eurodollar Rate Loan,
including without limitation any conversion required pursuant to
Section 4.03; or
(b) any failure by the Borrower to borrow, continue or
convert into a Fixed CD Loan or Eurodollar Rate Loan on the date for
such borrowing, continuation or conversion specified
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in the relevant Borrowing Notice under Section 2.01(b) and
Section 3.01(b) hereof;
such compensation to include, without limitation, an amount equal to the excess,
if any, of (i) the amount of interest which would have accrued on the principal
amount so paid, prepaid or converted or not borrowed for the period from the
date of such payment, prepayment or conversion or failure to borrow to the last
day of the then current Interest Period for such Loan (or, in the case of a
failure to borrow, the Interest Period for such Loan which would have commenced
on the date scheduled for such borrowing) at the applicable rate of interest for
such Fixed CD Loan or Eurodollar Rate Loan provided for herein over (ii) the
Applicable Reference Rate (as reasonably determined by the Agent) for Dollar
deposits of amounts comparable to such principal amount and maturities
comparable to such period; provided, however, that the amount payable hereunder
shall be reduced by the amount of interest actually paid by the Borrower during
the remaining term of such Interest Period in excess of the amount of interest
which would have been paid on the Fixed Rate Loan. In addition and without
duplication, Borrowers shall pay to the Agent for the benefit of the Lenders any
costs associated with the earlier termination of any foreign exchange agreements
or contracts associated with an Alternative Currency. A determination of a
Lender as to the amounts payable pursuant to this Section 4.04 shall be
conclusive, provided that such determinations are made on a reasonable basis.
The Lender requesting compensation under this Section 4.04 shall furnish to the
Authorized Representative calculations in reasonable detail setting forth such
Lender's determination of the amount of such compensation.
4.05 Alternate Loan and Lender. In the event any Lender suspends the
making of any Fixed Rate Loan pursuant to this Article IV (herein a "Restricted
Lender"), the Restricted Lender's Applicable Commitment Percentage of any Fixed
Rate Loan shall bear interest at either the Domestic Base Rate or the Fixed Rate
for which the suspension does not apply, as selected by the applicable Borrower,
until the Restricted Lender once again makes available the applicable Fixed Rate
Loan. Notwithstanding the provisions of Section 2.02(b) or Section 3.02(b),
interest shall be payable to the Restricted Lender at the time and manner as
paid to those Lenders making available Fixed Rate Loans.
4.06 Taxes. All payments by each Borrower of principal of, and
interest on, the Loans and all other amounts payable hereunder shall be made
free and clear of and without deduction for any present or future excise, stamp
or other taxes, fees, duties, levies, imposts, charges, deductions, withholdings
or other charges of any nature whatsoever imposed by any taxing authority, but
excluding (i) franchise taxes, (ii) any taxes (other than withholding taxes)
that would not be imposed but for a connection between a Lender or the Agent and
the jurisdiction imposing such taxes (other than a connection arising solely by
virtue of the
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activities of such Lender or the Agent pursuant to or in respect of this
Agreement or any other Loan Document), (iii) any withholding taxes payable with
respect to payments hereunder or under any other Loan Document under laws
(including, without limitation, any statute, treaty, ruling, determination or
regulation), (iv) any taxes imposed on or measured by any Lender's assets, net
income, receipts or branch profits and (v) any taxes arising after the Closing
Date solely as a result of or attributable to Lender changing its designated
Lending Office after the date such Lender becomes a party hereto (such
non-excluded items being collectively called "Taxes"). In the event that any
withholding or deduction from any payment to be made by any Borrower hereunder
is required in respect of any Taxes pursuant to any applicable law, rule or
regulation, then the applicable Borrower will
(a) pay directly to the relevant authority the full
amount required to be so withheld or deducted;
(b) promptly forward to the Agent an official receipt or
other documentation satisfactory to the Agent evidencing such
payment to such authority; and
(c) pay to the Agent for the account of the Lender such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount
such Lender would have received had no such withholding or deduction
been required.
Prior to the date that any Lender or participant organized under the
laws of a jurisdiction outside the United States becomes a party hereto, such
Person shall deliver to the Borrowers and the Agent such certificates, documents
or other evidence, as required by the Code or Treasury Regulations issued
pursuant thereto, properly completed, currently effective and duly executed by
such Lender or participant establishing that such payment is (i) not subject to
United States Federal backup withholding tax and (ii) not subject to United
States Federal withholding tax under the Code because such payment is either
effectively connected with the conduct by such Lender or participant of a trade
or business in the United States or totally exempt from United States Federal
withholding tax by reason of the application of the provisions of a treaty to
which the United States is a party or such Lender is otherwise exempt.
If the applicable Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Agent, for the account of
the respective Lender, the required receipts or other required documentary
evidence, the applicable Borrower shall indemnify the Lenders for any
incremental Taxes, interest or penalties that may become payable by any Lender
as a result of any such failure. For purposes of this Section 4.06, a
distribution hereunder by the Agent or any Lender to or for the account of any
Lender shall be deemed a payment by the applicable Borrower.
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4.07 Restricted Lender. In the event any Lender seeks additional
compensation pursuant to this Article IV or is restricted from making any Fixed
Rate Loan under this Agreement, including providing an Alternative Currency
which is made available by other Lenders (a "Restricted Lender"), TDC may cause
such Restricted Lender to be replaced by a financial institution reasonably
acceptable to the Agent which is not similarly restricted and will not seek such
additional compensation. Such Restricted Lender agrees to execute and to deliver
to the Agent an Assignment and Acceptance as provided in Section 12.01 hereof
upon payment of all amounts owed under this Agreement to such Restricted Lender.
4.08 Funding. In the event any Borrower elects to obtain any Loans as
Fixed Rate Loans pursuant to Section 2.01 or Section 3.01, or elects to continue
any Fixed Rate Loans or convert any portion of the principal amount of any
Domestic Base Rate Loans, Canadian Prime Rate Loans or Floating CD Loans to
Fixed Rate Loans pursuant to Section 2.09 or Section 3.08, each Lender may, if
it so elects, fulfill its obligation to make or continue any portion of the
principal amount of any Loan as, or to convert any portion of the principal
amount of any Loan into, a Fixed Rate Loan in accordance with any election made
by such Borrower by causing a foreign branch or affiliate of such Lender or an
international banking facility created by such Lender to make such Fixed Rate
Loan; provided that in such event such Fixed Rate Loan shall be deemed to have
been made by such Lender, and the obligation of the Borrower to repay such Fixed
Rate Loan shall nevertheless be to such Lender and shall be deemed to be held by
such Lender, to the extent of such Fixed Rate Loan, for the account of such
foreign branch, affiliate or international banking facility. In addition, the
Borrowers hereby consent and agree that, for purposes of any determination to be
made for purposes of this Agreement (including Sections 4.01, 4.02, 4.03 and
4.04), it shall be conclusively assumed that each Lender elected to fund all
Fixed Rate Loans by purchasing Dollar deposits in its eurodollar office's
interbank eurodollar market.
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ARTICLE V
Conditions to Making Loans, Issuing
Letters of Credit and Creating Acceptances
5.01 Conditions of Initial Advance and Issuance of Letters of Credit
and Creating Acceptances. The obligation of the Lenders to make the initial
Domestic Advance or Canadian Advance and of NationsBank and CIBC to issue the
Letters of Credit and create Acceptances is subject to the following conditions
precedent:
(a) The Agent shall have received, on the Closing Date in form and
substance satisfactory to the Agent and the Lenders the following:
(i) executed originals of each of this Agreement and the Notes
and the other Loan Documents, together with all schedules and
exhibits thereto in form and substance satisfactory to the Agent and
the Lenders;
(ii) favorable written opinion or opinions of counsel to the
Borrowers and each Subsidiary executing a Guaranty dated the Closing
Date, addressed to the Agent and the Lenders and satisfactory to
Smith Helms Mulliss & Moore, L.L.P., special counsel to the Agent,
substantially in the form of Exhibits K-1 and K-2 attached hereto;
(iii) resolutions of the board of directors (or of the appropriate
committee thereof) of each of the Borrowers certified by its
secretary or assistant secretary as of the Closing Date, appointing
the initial Authorized Representatives and approving and adopting the
Loan Documents to be executed by such Borrower, and authorizing the
execution and delivery thereof; specimen signatures of officers of
each Borrower executing the Loan Documents, certified by the
Secretary or Assistant Secretary of such Borrower;
(iv) the charter documents of each of the Borrowers
certified as of a recent date by the Secretary of State or
comparable official of its jurisdiction of organization;
(v) the by-laws of each of the Borrowers certified as of
the Closing Date as true and correct by the secretary or
assistant secretary of such Borrower;
(vi) certificates issued as of a recent date by the Secretary of
State or comparable official of the jurisdiction of the formation of
each of the Borrowers as to the corporate good standing of such
Borrower therein;
(vii) appropriate certificates of qualification to do
business and of corporate good standing with respect to each
of the Borrowers issued as of a recent date by the Secretary
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of State or comparable official of each jurisdiction in which the
failure to be qualified to do business could materially adversely
affect the business, operations or conditions, financial or
otherwise, of such Borrower;
(viii) with respect to each Significant Subsidiary executing a
Guaranty, each of the opinions, certificates and documents described
in subsections (ii) through (vii) above;
(ix) notice(s) of appointment of the initial Authorized
Representatives;
(x) all fees payable by the Borrowers on the Closing
Date to the Agent and the Lenders;
(xi) evidence satisfactory to the Agent of the repayment in full
and termination of each of the Prior Credit Facilities substantially
simultaneously with the making of the initial Domestic Advance and
the initial Canadian Advance hereunder, and the agreement to
terminate any Liens on assets securing any obligations under any of
the Prior Credit Facilities which termination shall be effected with
reasonable promptness following the Closing Date; and
(xii) such other documents, instruments, certificates and opinions
as the Agent or any Lender may reasonably request on or prior to the
Closing Date in connection with the consummation of the transactions
contemplated hereby; and
(b) In the good faith judgment of the Agent and the Lenders:
(i) there shall not have occurred or become known to the Agent
or the Lenders any material adverse change in the business, financial
condition, operations, properties or prospects of TDC and its
Subsidiaries, taken as a whole, since January 31, 1996;
(ii) no litigation shall be pending or threatened which would be
likely to materially and adversely affect the business, financial
condition, operations, properties or prospects of TDC and its
Subsidiaries, taken as a whole, or which could reasonably be expected
to restrain or enjoin, impose burdensome conditions on, or otherwise
materially and adversely (A) affect the ability of any of TDC and its
Subsidiaries to fulfill their respective obligations under the Loan
Documents, or (B) impair any interests or rights of the Agent or any
Lender under the Loan Documents; and
(iii) TDC and its Subsidiaries shall have received all approvals,
consents and waivers, and shall have made or given all necessary
filings and notices as shall be required to consummate the
transactions contemplated hereby without the occurrence of any
default under, conflict with or violation of
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(A) any applicable law, rule, regulation, order or decree of any
Governmental Authority or arbitral authority or (B) any agreement,
document or instrument to which any of TDC or any Subsidiaries is a
party or by which any of them or their properties is bound, except
for such approvals, consents, waivers, filings and notices the
receipt, making or giving of which is not, in the good faith judgment
of the Agent and the Lenders, material to the enforcement of any of
the Loan Documents, or the financial condition, business or
operations of TD and its Subsidiaries, taken as a whole.
5.02 Conditions of Loans. The obligations of the Lenders to make any
Loans, and of NationsBank or CIBC to issue Letters of Credit or create
Acceptances hereunder on or subsequent to the Closing Date are subject to the
satisfaction of the following conditions:
(a) the Agent shall have received a notice of such
borrowing or request if required by Sections 2.01 or 2.15
hereof or Section 3.01;
(b) the representations and warranties of the Borrowers set
forth in Article VII hereof and in each of the other Loan Documents
shall be true and correct on and as of the date of such Advance or
Loan or issuance of such Letter of Credit or Acceptance, as the case
may be, with the same effect as though such representations and
warranties had been made on and as of such date, except to the extent
that such representations and warranties expressly relate to an
earlier date and except that the financial statements referred to in
Section 7.02(c) shall be deemed to be those financial statements most
recently delivered to the Agent and the Lenders pursuant to Section
8.01 hereof;
(c) in the case of the issuance of a Letter of Credit,
Borrower shall have executed and delivered to NationsBank or CIBC, as
applicable, a Letter of Credit Application in form and content
acceptable to NationsBank or CIBC, as applicable, together with such
other instruments and documents as it shall request; provided that
the terms and conditions of this Agreement shall control if any
conflict should exist between the terms of such Letter of Credit
Application and this Agreement;
(d) in the case of the creation of a Domestic Acceptance,
the Multicurrency Facilities Borrower shall have executed and
delivered to NationsBank a General Acceptance Agreement for Domestic
Acceptances and a draft in form and content acceptable to NationsBank
together with such other instruments and documents as NationsBank
shall reasonably request;
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(e) at the time of each such Advance or Loan or issuance of
each Letter of Credit or Acceptance, as the case may be, no Default
or Event of Default specified in Article X hereof, shall have
occurred and be continuing;
(f) immediately after giving effect to a Domestic Advance
or Domestic Loan, a Domestic Acceptance or a Domestic Letter of
Credit, the Total Domestic Utilization shall not exceed the Total
Domestic Revolving Credit Commitment;
(g) immediately after giving effect to a Canadian Advance
or Canadian Loan, a Canadian Acceptance or a Canadian Letter of
Credit, the Total Canadian Utilization shall not exceed the Total
Canadian Revolving Credit Commitment;
(h) immediately after giving effect to a Swing Line Loan
the aggregate Swing Line Outstandings shall not exceed
$15,000,000;
(i) immediately after giving effect to the issuance of
any Domestic Letter of Credit the Letter of Credit
Outstandings shall not exceed $75,000,000;
(j) immediately after giving effect to the issuance of
any Canadian Letter of Credit, the Canadian Letter of Credit
Outstandings shall not exceed $25,000,000; and
(k) immediately after giving effect to any Competitive Bid
Loan, the aggregate principal amount of outstanding Competitive Bid
Loans shall not exceed $25,000,000.
Each borrowing of Loans and each issuance of a Letter of Credit and
Acceptance shall constitute a representation and warranty by the Borrowers that
the conditions set forth in clauses (b) and (e) above have been satisfied as of
the date thereof and that as of the date of such Advance or issuance of a Letter
of Credit or Acceptance there has not been any material adverse change in the
business, operations or financial condition of TDC and its Subsidiaries.
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ARTICLE VI
Security
6.01 Guaranties. As support for the full and timely payment and
performance of all Obligations, the Borrowers shall on or before the Closing
Date cause to be delivered to the Agent (i) the unconditional guaranty of
payment for the benefit of the Multicurrency Facilities Lenders of all
Obligations of the Multicurrency Facilities Borrowers in connection with the
Multicurrency Facilities by the Significant Subsidiaries of TDC (other than TD
France), and (ii) the unconditional guaranty of payment by TDC and its
Significant Subsidiaries (other than TD Canada) for the benefit of the Canadian
Facilities Lenders of all Obligations of TD Canada in connection with the
Canadian Facilities.
6.02 Further Assurances. At the request of the Agent, each Subsidiary
and TDC will execute by its duly authorized officers, alone or with the Agent,
any certificate, instrument, statement or document and will procure any such
certificate, instrument, statement or document (and pay all connected costs)
which the Agent reasonably deems necessary to create, continue or preserve the
guaranty by such Subsidiary or TDC.
6.03 New Subsidiaries. As provided in Section 8.20 hereof, to the
extent allowed under this Agreement, if TDC acquires or forms a Significant
Subsidiary, TDC shall cause such Significant Subsidiary to execute a Guaranty of
Obligations as described in Section 6.01(i) hereof.
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ARTICLE VII
Representations and Warranties
7.01 Representations and Warranties as to Borrowers and Subsidiaries.
Each Borrower represents and warrants to and in favor of the Agents and each
Lender with respect to itself and to its Subsidiaries (which representations and
warranties shall survive the delivery of the documents mentioned herein and the
making of Loans and the issuance of Letters of Credit), that:
(a) Organization and Authority. (i) It is a corporation
duly organized and validly existing under the laws of the
jurisdiction of its incorporation;
(ii) it has the corporate power and authority to own its
properties and assets and to carry on its business as now being
conducted and is qualified to do business in every jurisdiction in
which failure so to qualify would have a material adverse effect on
the business or operations of TDC or its Subsidiaries;
(iii) it has the corporate power and authority to execute and
perform this Agreement, and to borrow hereunder (in the case of a
Borrower), and to execute and deliver each of the other Loan
Documents to which it is a party;
(iv) each Subsidiary executing a Guaranty has the power
and authority to execute, deliver and perform the Guaranty to
which it is a party; and
(v) when executed and delivered, each of the Loan Documents to
which such Borrower or any Subsidiary is a party will be valid and
binding obligations of the Borrower or such Subsidiary signatory
thereto, enforceable against the Borrower or such Subsidiary
signatory thereto, in accordance with its terms, subject to the
effect of any applicable bankruptcy, moratorium, insolvency,
reorganization or other similar law affecting the enforceability of
creditors' rights generally and to the effect of general principles
of equity which may limit the availability of equitable remedies
(whether in a proceeding at law or in equity);
(b) Loan Documents. The execution, delivery and
performance by each Borrower and each Subsidiary of each of
the Loan Documents to which it is a party:
(i) have been duly authorized by all requisite
corporate action (including any required shareholder
approval) of such Borrower or its Subsidiaries, as the case
may be, required for the lawful execution, delivery and
performance thereof;
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(ii) do not violate any provisions of (1) applicable
law, (2) any order of any court or other agency of
government binding on the Borrower or its Subsidiaries or
its or their properties, (3) the charter documents or
by-laws of the Borrower or its Subsidiaries or (4) any
provisions of any indenture, agreement or other instrument
to which the Borrower or its Subsidiaries are a party, or
by which the properties or assets of the Borrower or its
Subsidiaries are bound;
(iii) will not be in conflict with, result in a breach
of or constitute an event of default, or an event which,
with notice or lapse of time, or both, would constitute an
event of default, under any indenture, agreement or other
instrument to which the Borrower or its Subsidiaries are a
party; and
(iv) will not result in the creation or imposition of
any Lien, charge or encumbrance of any nature whatsoever
upon any of the properties or assets of the Borrower or any
Subsidiary.
(c) Solvency. Each Borrower and each of its
Subsidiaries are Solvent after giving effect to the
transactions contemplated by this Agreement and the other Loan
Documents.
7.02 Representations and Warranties of TDC. TDC represents and
warrants with respect to itself and its Subsidiaries (which representations and
warranties shall survive the delivery of the documents mentioned herein and the
making of Loans) that:
(a) Subsidiaries and Stockholders. It has no Subsidiaries
other than those Persons listed as Subsidiaries in Schedule 7.02(a)
hereto; Schedule 7.02(a) to this Agreement states as of the date
hereof the authorized and issued capitalization of each Subsidiary,
the number of shares of each class of capital stock issued and
outstanding of each such Subsidiary and the number and percentage of
outstanding shares of each such class of capital stock owned by TDC
or by any such Subsidiary; the outstanding shares of each such
Subsidiary have been duly authorized and validly issued and are fully
paid and nonassessable; and TDC and each such Subsidiary owns
beneficially and of record all the shares it is listed as owning in
Schedule 7.02(a), free and clear of any Lien.
(b) Ownership Interests. It does not own any interest
in any Person other than the Persons listed in Schedule
7.02(b) hereto;
(c) Financial Condition. (i) TDC has heretofore
furnished to each Lender an audited unqualified consolidated
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balance sheet of TDC and its Subsidiaries as at January 31, 1996 and
the notes thereto and the related consolidated statements of income,
cash flow and changes in stockholders' equity for the Fiscal Year
then ended as examined and certified by Price Waterhouse L.L.P.
Except as set forth therein, such financial statements (including the
notes thereto) present fairly the financial condition of TDC and the
Subsidiaries as of the end of such Fiscal Year and results of their
operations and the changes in their stockholders' equity for the
Fiscal Year then ended, all in conformity with Generally Accepted
Accounting Principles applied on a Consistent Basis. Except as
disclosed therein or otherwise described or referred to in Schedule
7.02(c), neither TDC nor any Subsidiary has, as of the date hereof,
any known and material direct liability.
(ii) since January 31, 1996, there has been no material adverse
change in the condition, financial or otherwise, of TDC and its
Subsidiaries or in the businesses, properties and operations of TDC
and its Subsidiaries, in each case, considered as a whole, nor have
such businesses or properties, taken as a whole, been materially
adversely affected as a result of any fire, explosion, earthquake,
accident, strike, lockout, combination of workers, flood, embargo or
act of God;
(iii) except as set forth in Schedule 7.02(c) hereto, TDC and its
Subsidiaries have not incurred, other than in the ordinary course of
business, any material indebtedness, liabilities, obligations or
commitments, contingent or otherwise which remain outstanding or
unsatisfied;
(d) Title to Properties. TDC and its Subsidiaries have
title to all their respective real and personal properties subject to
no transfer restrictions, liens, mortgages, pledges, security
interests, encumbrances or charges of any kind, except for (i) the
transfer restrictions and liens described in Schedule 7.02(d)
attached hereto, and (ii) liens permitted under Section 9.06 hereof;
(e) Taxes. TDC and its Subsidiaries have filed or caused to
be filed all federal, state and local tax returns which are required
to be filed by them and except for taxes and assessments being
contested in good faith and against which satisfactory reserves have
been established, have paid or caused to be paid all taxes as shown
on said returns or on any assessment received by them, to the extent
that such taxes have become due;
(f) Other Agreements. Neither TDC nor any Subsidiary is
(i) a party to any judgment, order, decree or any
agreement or instrument or subject to restrictions
materially adversely affecting the business, properties
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or assets, operation or condition (financial or
otherwise) of TDC and the Subsidiaries, taken as a whole;
or
(ii) in default in the performance, observance or
fulfillment of any of the material obligations, covenants
or conditions contained in any agreement or instrument to
which TDC or any Subsidiary is a party, which default has,
or if not remedied within any applicable grace period could
have, a material adverse effect on the business, operations
or condition, financial or otherwise, of TDC and the
Subsidiaries taken as a whole;
(g) Litigation. Except as set forth in Schedule 7.02(g)
hereto, there is no action, suit or proceeding at law or in equity or
by or before any governmental instrumentality or agency or arbitral
body pending, or, to the best knowledge of TDC, threatened by or
against TDC or any Subsidiary or affecting TDC or any Subsidiary or
any properties or rights of TDC or any Subsidiary, which, if,
determined adversely to TDC or such Subsidiary, would materially
adversely affect the financial condition, business or operations of
TDC and the Subsidiaries taken as a whole;
(h) Margin Stock. Neither TDC nor any Subsidiary owns any
"margin stock" as such term is defined in Regulation U, as amended
(12 C.F.R. Part 221), of the Board. The proceeds of the borrowings
made pursuant to Sections 2.01, 2.04, 2.15 and 3.01 hereof, the
Letters of Credit and the Acceptances will be used by TDC only for
the purposes set forth in Section 2.13 and Section 3.11 hereof. None
of such proceeds will be used, directly or indirectly, for the
purpose of purchasing or carrying any margin stock or for the purpose
of reducing or retiring any Indebtedness which was originally
incurred to purchase or carry margin stock or for any other purpose
which might constitute any of the Loans under this Agreement a
"purpose credit" within the meaning of said Regulation U or
Regulation X (12 C.F.R. Part 224) of the Board. Neither TDC nor any
agent acting in its behalf has taken or will take any action which
might cause this Agreement or any of the documents or instruments
delivered pursuant hereto to violate any regulation of the Board or
to violate the Securities Exchange Act of 1934 or any state
securities laws, in each case as in effect on the date hereof;
(i) Investment Company. Neither TDC nor any Subsidiary
is an "investment company," or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment
company," as such terms are defined in the Investment Company
Act of 1940, as amended (15 U.S.C. ss.80a-1, et seq.). The
application of the proceeds of the Loans, the Letters of
Credit and the Acceptances and repayment thereof by TDC and
the performance by TDC of the transactions contemplated by
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this Agreement will not violate any provision of said Act, or any
rule, regulation or order issued by the Securities and Exchange
Commission thereunder, in each case as in effect on the date hereof;
(j) Patents, Etc. TDC and its Subsidiaries own or have the
right to use, under valid license agreements or otherwise, all
material patents, licenses, franchises, trademarks, trademark rights,
tradenames, tradename rights, copyrights and know how necessary to
the conduct of their businesses as now conducted, without known
material conflict with any patent, license, franchise, trademark,
trade secrets and confidential commercial or proprietary information,
tradename, copyright, rights to trade secrets or other proprietary
rights of any other Person;
(k) No Untrue Statement. Neither this Agreement nor any
other Loan Document or certificate or document executed and delivered
by or on behalf of TDC or any Subsidiary in accordance with Section
5.01 hereof contains any misrepresentation or untrue statement of
material fact or omits to state a material fact necessary, in light
of the circumstance under which it was made, in order to make any
such representation or statement contained therein not misleading in
any material respect;
(l) No Consents, Etc. Neither the respective businesses or
properties of TDC or any Subsidiary, nor any relationship between TDC
or any Subsidiary and any other Person, nor any circumstance in
connection with the execution, delivery and performance of the Loan
Documents and the transactions contemplated hereby is such as to
require a consent, approval or authorization of, or filing,
registration or qualification with, any governmental or other
authority or any other Person on the part of TDC or any Subsidiary as
a condition to the execution, delivery and performance of, or
consummation of the transactions contemplated by, this Agreement or
the other Loan Documents or if so, such consent, approval,
authorization, filing, registration or qualification has been
obtained or effected, as the case may be;
(m) ERISA.
(i) None of the employee benefit plans maintained at
any time by TDC or any Subsidiary or the trusts created thereunder
has engaged in a prohibited transaction which could subject any such
employee benefit plan or trust to a material tax or penalty on
prohibited transactions imposed under Internal Revenue Code Section
4975 or ERISA or under any Foreign Benefit Law;
(ii) None of the employee benefit plans maintained
at any time by TDC or any Subsidiary which are employee
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pension benefit plans and which are subject to Title IV of ERISA or
any Foreign Benefit Law or the trusts created thereunder has been
terminated so as to result in a material liability of TDC or any
Subsidiary under ERISA or any other Person exercising similar duties
and functions under any Foreign Benefit Law nor has any such employee
benefit plan of TDC incurred any liability to the Pension Benefit
Guaranty Corporation established pursuant to ERISA, other than for
required insurance premiums which have been paid; neither TDC nor any
Subsidiary has withdrawn from or caused a partial withdrawal to occur
with respect to any Multi-employer Plan; TDC and its Subsidiaries
have made or provided for all contributions to all such employee
pension benefit plans which they maintain and which are required as
of the end of the most recent fiscal year under each such plan;
neither TDC nor any Subsidiary has incurred any accumulated funding
deficiency with respect to any such plan, whether or not waived; nor
has there been any reportable event, or other event or condition,
which presents a material risk of termination of any such employee
benefit plan by such Pension Benefit Guaranty Corporation or other
Person exercising similar duties and functions under any Foreign
Benefit Law;
(iii) The present value of all vested accrued benefits
under the employee pension benefit plans which are subject to Title
IV of ERISA or any Foreign Benefit Law, maintained by TDC or any
Subsidiary, did not, as of the most recent valuation date for each
such plan, exceed the then current value of the assets of such
employee benefit plans allocable to such benefits;
(iv) The consummation of the Loans and the issuance of
the Letters of Credit and Acceptances provided for in Article II and
Article III will not involve any prohibited transaction under ERISA
or violate any Foreign Benefit Law;
(v) To the best of TDC's knowledge, each employee
pension benefit plan subject to Title IV of ERISA or other Foreign
Benefit Law, maintained by TDC or any Subsidiary, has been
administered in accordance with its terms and is in compliance in all
material respects with all applicable requirements of ERISA and other
applicable laws, regulations and rules and any applicable Foreign
Benefit Law;
(vi) There has been no withdrawal liability incurred
with respect to any Multi-employer Plan to which TDC or any
Subsidiary is or was a contributor;
(vii) As used in this Agreement, the terms "employee
benefit plan," "employee pension benefit plan," "accumulated funding
deficiency," "reportable event," and "accrued benefits" shall have
the respective meanings assigned to them
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in ERISA, and the term "prohibited transaction" shall have the
meaning assigned to it in Code Section 4975 and ERISA;
(viii) Neither TDC nor any Subsidiary has any liability,
contingent or otherwise, under any plan or program or the equivalent
for unfunded post-retirement benefits, including pension, medical and
death benefits, which liability would have a material adverse effect
on the financial condition of TDC and its Subsidiaries taken as a
whole;
(n) No Default. As of the date hereof, there does not
exist any Default or Event of Default hereunder;
(o) Hazardous Materials. Neither TDC nor, to the best of
TDC's knowledge, any previous owner or operator of any real property
currently owned or operated by TDC or any Subsidiary (collectively,
the "Property") or any other Person, has generated, stored, or
disposed of any Hazardous Material on any portion of the Property, or
transferred any Hazardous Material from the Property to any other
location, giving rise to any liability of TDC which would have a
materially adverse effect on TDC and the Subsidiaries taken as a
whole. TDC and each Subsidiary is in compliance with all applicable
Environmental Laws and neither TDC nor any Subsidiary has been
notified of any action, suit, proceeding or investigation which calls
into question compliance by TDC or any Subsidiary with any
Environmental Laws or which seeks to suspend, revoke or terminate any
license, permit or approval necessary for the generation, handling,
storage, treatment or disposal of any Hazardous Material.
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ARTICLE VIII
Affirmative Covenants
Until the Obligations have been paid and satisfied in full and this
Agreement has been terminated in accordance with the terms hereof, unless the
Required Lenders shall otherwise consent in writing, TDC will and will cause
each Subsidiary to:
8.01 Financial Reports, Etc. (a) as soon as practical and in any
event within 120 days after the end of each Fiscal Year of TDC, deliver or cause
to be delivered to the Agents and each Lender (i) consolidated and consolidating
balance sheets of TDC and its Subsidiaries, and the notes thereto, and the
related consolidated and consolidating statements of income, cash flow and
changes in stockholders' equity and the respective notes thereto for such Fiscal
Year, setting forth in each case comparative financial statements for the
preceding Fiscal Year, all prepared in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis and containing, with respect
to the consolidated financial reports, opinions of Price Waterhouse L.L.P., or
other such independent certified public accountants selected by TDC and approved
by the Required Lenders, which are unqualified as to the scope of the audit
performed and as to the "going concern" status of TDC; (ii) a copy of TDC's Form
10K as filed with the Securities and Exchange Commission; and (iii) a
certificate of an Authorized Representative demonstrating compliance with
Sections 9.01, 9.02, 9.03, 9.04, 9.05, 9.06(iv) and (v), 9.13, 9.15 and 9.16 of
this Agreement, which certificate shall be in the form attached as Exhibit L;
(b) as soon as practical and in any event within 60 days after the
end of each quarterly period (except the last reporting period of the Fiscal
Year), deliver to the Agents and each Lender (i) consolidated and consolidating
balance sheets of TDC and its Subsidiaries, as of the end of such reporting
period and the related consolidated and consolidating statements of income, cash
flow and changes in stockholders' equity for such reporting period and for the
period from the beginning of the Fiscal Year through the end of such reporting
period, certified by an Authorized Representative as presenting fairly the
financial position of TDC and its Subsidiaries as of the end of such reporting
period and the results of their operations and the changes in their financial
position for such reporting period, in conformity with the standards set forth
in Section 7.02(c)(i) with respect to interim financials, (ii) a copy of TDC's
Form 10Q for such quarterly period as filed with the Securities and Exchange
Commission and (iii) a certificate of an Authorized Representative containing
computations for such quarter similar to that required pursuant to Section
8.01(a)(iii);
(c) together with each delivery of the financial statements
required by Section 8.01(a) hereof, deliver to the Agents and each
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Lender a letter from TDC's accountants specified in Section 8.01(a) hereof
stating that in performing the examination necessary to render an opinion on the
financial statements delivered therewith, they obtained no knowledge of any
Default or Event of Default by TDC or any Subsidiary in the fulfillment of the
terms and provisions of this Agreement insofar as they relate to financial
matters (which at the date of such statement remains uncured); and if the
accountants have obtained knowledge of such Default or Event of Default, a
statement specifying the nature and period of existence thereof;
(d) promptly upon their becoming available to TDC, TDC shall deliver
to the Agents, and each Lender, a copy of (i) all regular or special reports or
effective registration statements which TDC or any Subsidiary shall file with
the Securities and Exchange Commission (or any successor thereto) or any
securities exchange, (ii) all reports, proxy statements, financial statements
and other information distributed by TDC to its stockholders, bondholders or the
financial community in general, and (iii) any reports submitted to TDC or any of
its Subsidiaries by independent accountants in connection with any annual,
interim or special audit of TDC or any of its Subsidiaries;
(e) promptly, from time to time, deliver or cause to be delivered to
each Lender such other information regarding TDC's and each Subsidiary's
operations, business affairs and financial condition as such Lender may
reasonably request, including audited financial statements of any Subsidiary, to
the extent such statements exist. The Agents and the Lenders are hereby
authorized to deliver a copy of any such financial information delivered
hereunder to the Lenders (or any affiliate of any Lender) or to the Agent, to
any regulatory authority having jurisdiction over any of the Lenders pursuant to
any written request therefor, to any other Person who shall acquire or consider
the acquisition of a participation interest in or assignment of any Loan or the
Letters of Credit or Acceptances permitted by this Agreement;
8.02 Maintain Properties. Maintain all properties and other
personal property necessary to its operations in good working order
and condition and make all needed repairs, replacements and
renewals as are necessary to conduct its business in accordance
with customary business practices;
8.03 Existence, Qualification, Etc. Do or cause to be done all things
necessary to preserve and keep in full force and effect its existence and all
material rights and franchises, trade names, trademarks and permits and maintain
its license or qualification to do business as a foreign corporation and good
standing in each jurisdiction in which its ownership or lease of property or the
nature of its business where the failure to maintain such license or
qualification would have a material adverse effect on TDC and its Subsidiaries;
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8.04 Regulations and Taxes. Comply with or contest in good faith all
statutes and governmental regulations and pay all taxes, assessments,
governmental charges, claims for labor, supplies, rent and any other obligation
which, if unpaid, might become a lien against any of its properties except
liabilities being contested in good faith and against which adequate reserves
have been established;
8.05 Insurance. TDC shall, and shall cause each Subsidiary to,
maintain with financially sound and reputable insurers insurance with respect to
its properties and business and against such liabilities, casualties and
contingencies of such types and in such amounts as is customary in the case of
corporations engaged in the same or a similar business or having similar
properties similarly situated.
8.06 True Books. Keep true books of record and account in which full,
true and correct entries will be made of all of its dealings and transactions,
and set up on its books such reserves as may be required by Generally Accepted
Accounting Principles or other accounting principles applicable in the
jurisdiction of a Borrower or Subsidiaries organization or creation with respect
to all taxes, assessments, charges, levies and claims and with respect to its
business in general, and include such reserves in interim as well as year-end
financial statements.
8.07 Pay Indebtedness to Lenders and Perform Other Covenants. (a)
Make full and timely payment of the principal of and interest on the Notes and
all other Obligations whether now existing or hereafter arising; and (b) duly
comply with all the terms and covenants contained in all other instruments and
documents given to the Agent or any Lender pursuant to this Agreement.
8.08 Right of Inspection. Permit any Person designated by any Lender,
at the Lender's expense, to visit and inspect any of the properties, corporate
books and financial reports of TDC and its Subsidiaries, and to discuss its
affairs, finances and accounts with its principal officers and independent
certified public accountants, all at such reasonable times, at reasonable
intervals and with reasonable prior notice. Information received by the Agent
and any Lender pursuant to such inspections shall be limited to distribution in
the same manner as described in Section 8.01(e) hereof.
8.09 Observe all Laws. Conform to and duly observe all laws,
regulations and other valid requirements of any regulatory authority with
respect to the conduct of its business, the failure of which to observe would
have a material adverse effect on its business.
8.10 Covenants Extending to Subsidiaries. Cause each of its
Subsidiaries to do with respect to itself, its business and its
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assets, each of the things required of TDC in Sections 8.02 through
8.09, inclusive.
8.11 Officer's Knowledge of Default. Upon an officer of TDC obtaining
knowledge of any Default or Event of Default hereunder or under any other
obligation of TDC or any Subsidiary, cause such officer to promptly notify the
Agents of the nature thereof, the period of existence thereof, and what action
TDC proposes to take with respect thereto.
8.12 Suits or Other Proceedings. Upon an officer of TDC obtaining
knowledge of any litigation, dispute or proceedings being instituted or
threatened against TDC or its Subsidiaries, or any attachment, levy, execution
or other process being instituted against any assets of TDC or its Subsidiaries
in an amount greater than $500,000 not otherwise covered by insurance, promptly
deliver to the Agents written notice thereof stating the nature and status of
such litigation, dispute, proceeding, levy, execution or other process.
8.13 Environmental Reports. Promptly provide to the Agents true,
accurate and complete copies of any and all documents, including reports,
submissions, notices, orders, directives, findings and correspondence made by
TDC or any Subsidiary to the United States Environmental Protection Agency
("EPA"), the United States Occupational Safety and Health Administration
("OSHA") or to any other federal, state or local authority pursuant to any
federal, state or local law, code or ordinance and all rules and regulations
promulgated thereunder which require informational submissions concerning
environmental, health or safety matters.
8.14 Notice of Discharge of Hazardous Material or Environmental
Complaint. Give to the Agents immediate written notice of any complaint, order,
directive, claim, citation or notice by any governmental authority or any Person
to TDC, any Subsidiary or any successor with respect to (i) air emissions, (ii)
spills, releases or discharges to soils or improvements located thereon, surface
water, groundwater or the sewer, septic system or waste treatment, storage or
disposal systems servicing the Property, (iii) noise emissions, (iv) solid or
liquid waste disposal, or (v) the use, generation, storage, transportation or
disposal of Hazardous Material. Such notices shall include, among other
information, the name of the party who filed the claim, the nature of the claim
and the actual or potential amount of the claim. TDC shall promptly comply with
its obligations under law with regard to such matters. However, TDC shall not be
obligated to give such notice to Agent of discharge or existence of any
Hazardous Material which occurs legally in accordance with and pursuant to the
terms and conditions of a valid governmental permit, license, certificate or
approval therefor.
8.15 Indemnification. The Borrowers hereby jointly and
severally agree to defend, indemnify and hold the Agents and
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Lenders harmless from and against any and all claims, losses, liabilities,
damages and expenses (including, without limitation, cleanup costs and
reasonable attorneys' fees including those arising by reason of any of the
aforesaid or an action against TDC or any Subsidiary under this indemnity)
arising directly or indirectly from, out of or by reason of the handling,
storage, treatment, emission or disposal of any Hazardous Material by or in
respect of TDC or any Subsidiary or property owned or leased by TDC or any
Subsidiary. The provisions of this Section 8.16 shall survive repayment of the
Obligations, occurrence of the Revolving Credit Termination Date and expiration
or termination of this Agreement. This indemnity shall not apply to the extent
of damages caused to Agent, Lenders or others by Agent or Lenders.
8.16 Further Assurances. At its cost and expense, upon request of
either of the Agents, duly execute and deliver or cause to be duly executed and
delivered, to the Agents such further instruments, documents, certificates, and
do and cause to be done such further acts that may be reasonably necessary or
advisable in the opinion of the Agents to carry out more effectively the
provisions and purposes of this Agreement and the other Loan Documents.
8.17 ERISA Requirement. Comply with all material requirements of
ERISA, to the extent applicable, and any Foreign Benefit Law applicable to it
and furnish to the Agents as soon as possible and in any event (i) within thirty
(30) days after TDC or duly appointed administrator of a employee benefit plan
knows or has reason to know that any reportable event or other event under any
Foreign Benefit Law with respect to any employee benefit plan has occurred,
written statement of an Authorized Representative describing in reasonable
detail such reportable event or other event under any Foreign Benefit Law and
any action which TDC proposes to take with respect thereto, together with a copy
of the notice of such reportable event given to the PBGC or a statement that
said notice will be filed with the annual report of the United States Department
of Labor with respect to such plan if such filing has been authorized, (ii)
promptly after receipt thereof, a copy of any notice that TDC or any Subsidiary
may receive from the PBGC relating to the intention of the PBGC to terminate any
employee benefit plan or plans or to appoint a trustee to administer any such
plan, and (iii) within 10 days after a filing with the PBGC pursuant to Section
412(n) of the Code of a notice of failure to make a required installment or
other payment with respect to a plan, a certificate of an Authorized
Representative setting forth details as to such failure and the action that TDC
or its Subsidiary proposes to take with respect thereto, together with a copy of
such notice given to the PBGC.
8.18 Continued Operations. Continue at all times (i) to maintain the
chief executive offices and principal place of business of TDC at 5350 Tech Data
Drive, Clearwater, Florida 34620 (ii) continue to conduct and cause each
Subsidiary to conduct its
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business and engage principally in the same line or lines of business
substantially as heretofore conducted, and (iii) preserve, protect and maintain
free from liens its material patents, copyrights, licenses, trademarks,
trademark rights, trade names, trade name rights, trade secrets and know-how
necessary or useful in the conduct of its operations.
8.19 Use of Proceeds. Use the proceeds of the Loans, Letters of
Credit and Acceptances solely for the purposes specified in Articles II and III
hereof, as applicable.
8.20 New Subsidiaries. (a) Simultaneously with the formation of any
Significant Subsidiary or the acquisition of any Significant Subsidiary
permitted by the terms of this Agreement or at any time a Subsidiary becomes a
Significant Subsidiary, cause to be delivered to the Agent for the benefit of
the Lenders each of the following:
(i) a guarantee agreement of each Significant
Subsidiary, each duly executed by such Significant Subsidiary
substantially in the form of the Guaranty;
(ii) an opinion of counsel to the Borrowers and the Significant
Subsidiaries (which may be an employee of TDC) dated as of the date
of delivery of the documents provided in the foregoing clause (i) and
addressed to the Agent and the Lenders, in form and substance
reasonably acceptable to the Agent and the Lenders (which opinion may
include assumptions and qualifications of similar effect to those
contained in the opinions of counsel delivered pursuant to Section
5.01(b) hereof), to the effect that:
(A) such Significant Subsidiary is duly
organized, validly existing and in good standing in the
jurisdiction of its incorporation, has the requisite
corporate power and authority to own its properties and
conduct its business as then owned and then proposed to be
conducted and is duly qualified to transact business and is
in good standing as a foreign corporation in each other
jurisdiction in which the character of the properties owned
or leased, or the business carried on by it, requires such
qualification; and
(B) the execution, delivery and performance of
the documents described in clause (i) of this Section 8.20
to which such Significant Subsidiary or its parent is a
signatory have been duly authorized by all requisite
corporate action (including any required shareholder
approval), such documents have been duly executed and
delivered and constitute valid and binding obligations of
such Significant Subsidiary or its parent, as the case may
be, enforceable against such Subsidiary or its parent in
accordance with its terms, subject to the effect of
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any applicable bankruptcy, moratorium, insolvency,
reorganization or other similar law affecting the
enforceability of creditors' rights generally and to the
effect of general principles of equity which may limit the
availability of equitable remedies (whether in a proceeding
at law or in equity); and
(ii) current copies of the charter and bylaws of such Significant
Subsidiary, minutes of duly called and conducted meetings (or duly
effected consent actions) of the Board of Directors (and, if required
by such charter, bylaws or by applicable laws, of the shareholders)
of such Significant Subsidiary and its parent authorizing the actions
and the execution and delivery of documents described in clauses (i)
and (ii) of this Section 8.20 and evidence satisfactory to the Agent
(confirmation of the receipt of which will be provided by the Agent
to the Lenders) that such Significant Subsidiary is Solvent as of
such date and after giving effect to its Guaranty.
(b) If at any time the sum of the total assets or total revenues of
Subsidiaries that have not executed and delivered to the agent a Guaranty
exceeds in the aggregate $2,000,000, TDC shall promptly cause there to be
delivered to the Agent one or more additional Guaranties of Subsidiaries that do
not constitute Significant Subsidiaries in order that after giving effect to
such additional Guaranties, the sum of the total assets or total revenues, in
either or both cases, of Subsidiaries not having delivered a Guaranty does not
exceed in the aggregate $2,000,000.
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ARTICLE IX
Negative Covenants
Until the Obligations have been paid and satisfied in full and this
Agreement has been terminated in accordance with the terms hereof, unless the
Required Lenders shall otherwise consent in writing, TDC will not, nor will it
permit any Subsidiary to:
9.01 Asset Coverage Ratio. Permit at any time the
Consolidated Asset Coverage Ratio to be less than 1.25 to 1.00.
9.02 Net Worth. Permit at any time Consolidated Tangible Net Worth to
be less than the sum of (a) $270,000,000, plus (b) on a cumulative basis, (with
no reduction for net losses during such period) 75% of Consolidated Net Income
for each fiscal quarter beginning on April 30, 1996. In addition, after the date
hereof, such minimum level of Consolidated Tangible Net Worth shall be increased
by 100% of the net proceeds received by the Borrower from the sale of any shares
of capital stock.
9.03 Indebtedness to Total Capital. Permit the ratio of Consolidated
Funded Indebtedness to the Consolidated Total Capital to exceed .63 to 1.00 from
the Closing Date through January 31, 1997 and .60 to 1.00 at any time
thereafter.
9.04 EBIT to Interest Expense. Permit the ratio of Consolidated EBIT
to Consolidated Interest Expense for the Four- Quarter Period immediately
preceding the date of computation to be less than 2.50 to 1.00 at any time.
9.05 Lease Expense Ratio. Permit at any time the ratio of the (i) sum
of Consolidated EBIT plus Consolidated Lease Expense for the Four-Quarter Period
immediately preceding the date of computation to (ii) the sum of Consolidated
Interest Expense plus Consolidated Lease Expense for the Four-Quarter Period
immediately preceding the date of computation to be less than 2.00 to 1.00.
9.06 Indebtedness. Incur, create, assume or permit to exist
any Indebtedness, howsoever evidenced, except
(i) Indebtedness existing as of the date hereof which is
set forth in Schedule 9.06 attached hereto;
(ii) Indebtedness arising in connection with this
Agreement;
(iii) the endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary
course of business;
(iv) Indebtedness incurred to purchase personal property
provided such Indebtedness is secured only by the property so
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acquired and does not exceed the actual cost of such property;
provided that the total outstanding amount of all such Indebtedness
shall not exceed at any time $15,000,000;
(v) Indebtedness, including the Indebtedness permitted under
clause (iv) of this Section 9.06, not exceeding in the aggregate
amount at any time outstanding $50,000,000, so long as after giving
effect thereto no Default or Event of Default exists hereunder; and
(vi) any obligations arising under the Transfer and
Administration Agreement.
9.07 Liens. Incur, create or permit to exist any pledge, Lien, charge
or other encumbrance of any nature whatsoever with respect to any property or
assets now owned or hereafter acquired by Borrower or any of its Subsidiaries,
other than
(i) Liens existing as of the date hereof which are set
forth in Schedule 7.02(d) attached hereto;
(ii) Liens on that equipment acquired with Indebtedness
permitted under Section 9.06(iv) hereof;
(iii) Liens on Receivables arising in connection with the
Trade Receivable Purchase Facility;
(iv) any unfiled lien of materialmen, mechanics, workmen,
warehousemen, carriers, landlords or repairmen; provided that if such
a lien shall be perfected and shall not be contested in good faith,
it shall be discharged of record immediately by payment, bond or
otherwise;
(v) tax liens which are being contested in good faith,
or which constitute liens for taxes the payment of which is
not yet required; and
(vi) easements, restrictions, defects in title, covenants and
similar encumbrances in respect of real estate as do not render title
thereto uninsurable or detract from or interfere in any material
respect with the use of such property subject thereto in connection
with the business of the Borrower or any of its Subsidiaries.
9.08 Transfer of Assets. Sell, lease, transfer or otherwise dispose
of any item of property or asset except (i) sales, leases, transfers or other
dispositions in the ordinary course of business, (ii) sales and dispositions of
assets or property which are obsolete, worn out or no longer useful in
Borrower's business, (iii) sales or transfers of receivables related to the
Transfer and Administration Agreement, (iv) the inter-company transfer or sales
of receivables, inventory or other assets to Subsidiaries who have guaranteed
payment of the Obligations and (v) undeveloped real
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property located in Clearwater, Florida and a contract for the acquisition of
real property each of which shall be transferred to the Trustee and become
subject to the TDC TROL.
9.09 Investments. Purchase, own, invest in or otherwise acquire,
directly or indirectly, any stock or other securities, or make or permit to
exist any interest whatsoever in any other Person or permit to exist any loans
or advances to any Person; provided, TDC and its Subsidiaries may maintain
investments or invest in
(i) direct obligations of the United States of America or
any agency or instrumentality thereof or obligations guaranteed by
the United States of America or any agency or instrumentality
thereof, provided that such obligations mature within one year from
the date of acquisition thereof;
(ii) demand deposits, time deposits or certificates of deposit
issued by any of the Lenders or in certificates of deposit maturing
within one year from the date of acquisition issued by a bank or
trust company organized under the laws of the United States or any
state thereof having capital surplus and undivided profits
aggregating at least $400 million and being rated A-3 or better by
Standard & Poors or A or better by Moody's Investors Services, Inc.;
(iii) commercial paper rated A-1 or better by Standard & Poors or
P-1 or better by Moody's Investors Services, Inc.
(Commercial Paper Record);
(iv) one or more Subsidiaries, all of the issued and outstanding
capital stock of which is owned beneficially and of record by TDC or
by a wholly-owned Subsidiary of TDC, created or acquired in
compliance with the provisions of Section 8.22 hereof;
(v) shares of capital stock owned by TDC and each
Subsidiary as listed on Schedule 7.02(a);
(vi) investments existing as of the date hereof which are
set forth in Schedule 7.02(b) attached hereto; and
(vii) loans by TDC or a wholly-owned Subsidiary of TDC to another
wholly-owned Subsidiary of TDC or TDC.
9.10 Merger or Consolidation. (a) Consolidate with or merge into any
other Person, or (b) permit any other Person to merge into TDC if after giving
effect to the merger of any Person into TDC (i) a Default or Event of Default
would exist under this Agreement or (ii) TDC is not the surviving entity. Any
Subsidiary of TDC may merge with and into any other entity if the survivor is a
Subsidiary of TDC.
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9.11 Transactions with Affiliates. Enter into any transaction after
the date hereof, including, without limitation, the purchase, sale, leasing or
exchange of property, real or personal, or the rendering of any service, with
any stockholder, officer or director of TDC or any Subsidiary (other than TDC or
another Subsidiary), except (a) that directors, shareholders, officers and
employees of TDC and the Subsidiaries may render services to TDC or the
Subsidiaries for compensation at the same rates generally paid by corporations
engaged in the same or similar businesses for the same or similar services and
(b) in the ordinary course of and pursuant to the reasonable requirements of
TDC's (or any Subsidiary's) business consistent with past practice of TDC and
its Subsidiaries and upon fair and reasonable terms no less favorable to TDC (or
any Subsidiary) than would be obtained in a comparable arm's-length transaction
with a Person not a stockholder, officer or director.
9.12 ERISA. With respect to all employee pension benefit
plans maintained by TDC or any Subsidiary:
(i) terminate any of such employee pension benefit plans so
as to incur any liability in excess of $500,000 to the Pension
Benefit Guaranty Corporation established pursuant to ERISA or to any
other Person exercising similar duties and
functions under any Foreign Benefit Law;
(ii) allow or suffer to exist any prohibited transaction
involving any of such employee pension benefit plans or any trust
created thereunder which would subject TDC or a Subsidiary to a tax
or penalty or other liability (A) on prohibited transactions in
excess of $500,000 imposed under Internal Revenue Code Section 4975
or ERISA or (B) under any Foreign Benefit Law;
(iii) fail to pay to any such employee pension benefit plan any
contribution which it is obligated to pay under the terms of such
plan;
(iv) allow or suffer to exist any accumulated funding
deficiency, whether or not waived, with respect to any such employee
pension benefit plan;
(v) allow or suffer to exist any occurrence of a reportable
event or any other event or condition, which presents a material risk
of termination by the Pension Benefit Guaranty Corporation of any
such employee pension benefit plan that is a Single Employer Plan,
which termination could result in any liability (A) to the Pension
Benefit Guaranty Corporation or (B) under any Foreign Benefit Law; or
(vi) incur any withdrawal liability with respect to any
Multi-employer Plan which is not fully funded.
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9.13 Capital Expenditures. Make or become committed to make, directly
or indirectly, for any Fiscal Year (on a non-cumulative basis, to the effect
that expenditures permitted but not made in any Fiscal Year may not be made in
any subsequent Fiscal Year) expenditures for fixed or capital assets (including,
without limitation, Capital Leases) amounting in the aggregate for TDC and its
Subsidiaries to more than $40,000,000 during any Fiscal Year.
9.14 Fiscal Year. Change its Fiscal Year.
9.15 Rate Hedging Obligations. Incur any Rate Hedging Obligations or
enter into any agreements, arrangements, devices or instruments relating to Rate
Hedging Obligations, except in regard to (i) Indebtedness evidenced by the
Notes, the aggregate amount of such outstanding Rate Hedging Obligation in no
event to exceed $290,000,000, provided, however, that the expiration or maturity
date of such Rate Hedging Obligation or agreement or arrangement relating
thereto, may not exceed the maturity date of the Notes; (ii) Indebtedness and
obligations arising pursuant to the Trade Receivable Purchase Facility, the
aggregate amount of such Rate Hedging Obligation not to exceed $300,000,000;
(iii) existing Indebtedness to Aetna Life and Casualty Company secured by TDC's
headquarters office building, all such Rate Hedging Obligations to be at rates,
in form and with counterparties reasonably acceptable to the Agent and (iv) up
to $55,000,000 of obligations arising under the TDC TROL.
9.16 Acquisition. (a) Enter into any agreement to acquire
all or any part of the assets or equity securities of any Person
unless such acquisition constitutes a Permitted Acquisition; and
(b) Enter into any agreement to acquire all or any part of the assets
or equity securities of any Person if the Cost of Acquisition of such assets or
Person exceeds 25% of Consolidated Tangible Net Worth.
9.17 Transfer and Administration Agreement. Amend, modify or
change the definition of Eligible Receivables as set forth in the
Transfer and Administration Agreement as it exists on the Closing
Date.
9.18 Existing TD France Subsidiaries. Permit any loan or advance to
or additional investment in, the incurrence or existence of any Indebtedness or
the creation of any Lien by, or the payment of any dividend or distribution to
any shareholder or partner by, any Existing TD France Subsidiary, except TD
France may make payments for services of employees of Existing TD France
Subsidiaries rendered for the benefit of TD France.
9.19 Lease-Backs. Enter into any arrangements, directly or
indirectly, with any Person whereby any of the Borrowers or its Subsidiaries
shall sell or transfer any property, whether now owned or hereafter acquired,
used or useful in their business, in
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connection with the rental or lease of the property, so sold or transferred or
of other property which the Borrowers or their Subsidiaries intend to use for
substantially the same purpose or purposes as the property so sold or
transferred except (i) the sale of undeveloped real property located in
Clearwater, Florida, and (ii) property of the Borrowers and its Subsidiaries
having a book value of not to exceed in the aggregate $5,000,000.
9.20 Dividends or Distributions. Declare or pay dividends (other than
stock dividends) or make other stockholder distributions or purchases of its
capital stock, or make any distribution of capital, cash or property to any
stockholders or partners provided, however, that nothing in this Section 9.20
shall limit the right of TDC to purchase shares of its common stock for the
purposes of making required contributions to its employee stock option plan so
long as the aggregate dollar amount spent for such stock in any Fiscal Year does
not exceed $5,000,000.
9.21 Negative Pledge. Except as set forth in Schedule 9.21,
enter into any agreement whereby any Borrower or a Subsidiary
limits its rights to impose any Lien or encumbrance on any of its
assets.
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ARTICLE X
Events of Default and Acceleration
10.01 Events of Default. If any one or more of the following events
(herein called "Events of Default") shall occur for any reason whatsoever (and
whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or pursuant to or in compliance with any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body), that is to say:
(a) if default shall be made in the due and punctual
payment of the principal of any Loan or Reimbursement Obligation,
when and as the same shall be due and payable whether pursuant to any
provision of Article II or Article III hereof, at maturity, by
acceleration or otherwise; or
(b) if default shall be made in the due and punctual
payment of any amount of interest on any Loan or Reimbursement
Obligation or of any fees on the date on which the same shall be due
and payable; or
(c) if default shall be made in the performance or
observance of any covenant set forth in Sections 8.07, 8.11 or
Article IX hereof; or
(d) if a default shall be made in the performance or
observance of, or shall occur under, any covenant, agreement or
provision contained in this Agreement or the Notes (other than as
described in clauses (a), (b) or (c) above) and such default shall
continue for 30 or more days after the earlier of receipt of notice
of such default by the Authorized Representative from the Agent or
any Borrower becomes aware of such default, or if a default shall be
made in the performance or observance of, or shall occur under, any
covenant, agreement or provision contained in any of the other Loan
Documents or in any instrument or document evidencing or creating any
obligation, guaranty, lien or security interest in favor of the Agent
or Canadian Agent or delivered to any of the Lenders in connection
with or pursuant to this Agreement or any of the Obligations (beyond
any applicable grace period contained therein), or if any Loan
Document ceases to be in full force and effect (other than by reason
of any action by the Agent or any Lender), or if without the written
consent of the Lenders, this Agreement or any other Loan Document
shall be disaffirmed or shall terminate, be terminable or be
terminated or become void or unenforceable for any reason whatsoever
(other than in accordance with its terms in the absence of default or
by reason of any action by the Agents or any Lender); or
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(e) if a default shall occur, which is not waived, (i) in
the payment of any principal, interest or premium with respect to any
Indebtedness in an amount in excess of $500,000 (other than the Loans
and Reimbursement Obligations) of TDC or any Subsidiary or (ii) in
the performance, observance or fulfillment of any term or covenant
contained in any agreement or instrument under or pursuant to which
any such Indebtedness may have been issued, created, assumed,
guaranteed or secured by TDC or any Subsidiary, and such default
shall continue for more than the period of grace, if any, therein
specified, or if such default shall permit the holder of any such
Indebtedness to accelerate the maturity thereof; or
(f) if any representation, warranty or other statement of
fact contained herein or in any writing, certificate, report or
statement at any time furnished to either of the Agents or any Lender
by or on behalf of TDC or any Subsidiary pursuant to or in connection
with this Agreement, or otherwise, shall be false or misleading in
any material respect when given; or
(g) if TDC or any Subsidiary shall be unable to pay its
debts generally as they become due; file a petition to take advantage
of any insolvency statute; make an assignment for the benefit of its
creditors; commence a proceeding for the appointment of a receiver,
trustee, liquidator or conservator of itself or of the whole or any
substantial part of its property; file a petition or answer seeking
receivership, liquidation, reorganization or arrangement or similar
relief under the federal bankruptcy laws or any other applicable law
or statute of the United States of America or any state or similar
law of any other country or province thereof; or
(h) if a court of competent jurisdiction shall enter an
order, judgment or decree appointing a custodian, receiver, trustee,
liquidator or conservator of TDC or any Subsidiary or of the whole or
any substantial part of its properties, or approve a petition filed
against TDC or any Subsidiary seeking receivership, liquidation,
reorganization or arrangement or similar relief under the federal
bankruptcy laws or any other applicable law or statute of the United
States of America or any state or similar law of any other country or
province thereof; or if, under the provisions of any other law for
the relief or aid of debtors, a court of competent jurisdiction shall
assume custody or control of TDC or any Subsidiary or of the whole or
any substantial part of its properties; or if there is commenced
against TDC or any Subsidiary any proceeding or petition seeking
receivership, liquidation, reorganization, arrangement or similar
relief under the federal bankruptcy laws or any other applicable law
or statute of the United States of America or any state or similar
law of any other country or province thereof, which proceeding or
petition remains undismissed for a period of 90 days; or if
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TDC or any Subsidiary takes any action to indicate its consent
to or approval of any such proceeding or petition; or
(i) if (i) any judgment where the amount not covered by
insurance (or the amount as to which the insurer denies liability) is
in excess of $500,000 is rendered against TDC or any Subsidiary, or
(ii) there is any attachment, injunction or execution against any of
TDC's or any Subsidiary's properties for any amount in excess of
$500,000; and such judgment, attachment, injunction or execution
remains unpaid, unstayed or undismissed for a period of sixty (60)
days; or
(j) if TDC or any Subsidiary shall, other than in the
ordinary course of business (as determined by past practices),
suspend all or any part of its operations material to the conduct of
the business of TDC and the Subsidiaries, taken as a whole; or
(k) if (i) TDC or any Subsidiary shall engage in any
prohibited transaction (as described in Section 9.12(ii) hereof)
involving any employee pension benefit plan of TDC or any Subsidiary,
(ii) any accumulated funding deficiency (as referred to in Section
9.12(iv) hereof), whether or not waived, shall exist with respect to
any Single Employer Plan, (iii) a reportable event (as referred to in
Section 9.12(v) hereof) (other than a reportable event for which the
statutory notice requirement to the Pension Benefit Guaranty
Corporation has been waived by regulation) shall occur with respect
to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed to administer or to terminate, any Single
Employer Plan, which reportable event or institution or proceedings
is, in the reasonable opinion of the Required Lenders, likely to
result in the termination of such Single Employer Plan for purposes
of Title IV of ERISA, and in the case of such a reportable event, the
continuance of such reportable event shall be unremedied for thirty
(30) days after notice of such reportable event pursuant to Section
4043(a), (c) or (d) of ERISA is given, as the case may be, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of
ERISA, (v) TDC or any Subsidiary shall withdraw from a Multi-employer
Plan for purposes of Title IV of ERISA, and, as a result of any such
withdrawal, TDC or any Subsidiary shall incur withdrawal liability to
such Multi-employer Plan, or (vi) any other event or condition shall
occur or exist; and in each case in clauses (i) through (vi) of this
Section 10.01(k), such event or condition, together with all other
such events or conditions, if any, could subject TDC or any
Subsidiary to any tax, penalty or other liabilities in the aggregate
material in relation to the business, operations, property or
financial or other condition of TDC and the Subsidiaries, taken as a
whole, and in each such case the event or condition is not remedied
to the satisfaction of the Required Lenders within ninety (90) days
after the earlier of
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(i) receipt of notice of such event or condition by the Authorized
Representative from the Agent or (ii) TDC becomes aware of such event
or condition; or
(l) if TDC or any Subsidiary shall breach any of the terms
or conditions of any agreement under which any Rate Hedging
Obligation permitted pursuant to Section 9.15 is created and such
breach shall continue beyond any grace period, if any relating
thereto pursuant to the terms of such Obligation; or TDC shall
disaffirm or seek to disaffirm any such agreement or any of its
obligations thereunder; or
(m) if a Termination Event (as defined in the Transfer and
Administration Agreement) shall occur under the Transfer and
Administration Agreement which Termination Event is not cured or
waived;
(n) if there shall occur any Change of Control of TDC or
any Significant Subsidiary; or
(o) if there shall occur any event of default under the
TDC TROL, which is not cured within any grace period;
then, and in any such event and at any time thereafter, if such Event of Default
or any other Event of Default shall then be continuing,
(A) either or both of the following actions may
be taken: (i) the Agent, with the consent of the Required
Lenders, may, and at the direction of the Required Lenders
shall, declare any obligation of the Lenders to make
further Loans or issue Letters of Credit or Acceptances
terminated, whereupon the obligation of each Lender to make
further Loans or issue Letters of Credit or Acceptances,
hereunder shall terminate immediately, and (ii) the Agent
shall at the direction of the Required Lenders, at their
option, declare by notice to the Borrowers any or all of
the Obligations to be immediately due and payable, and the
same, including all interest accrued thereon and all other
obligations of the Borrowers to the Lenders, shall
forthwith become immediately due and payable without
presentment, demand, protest, notice or other formality of
any kind, all of which are hereby expressly waived,
anything contained herein or in any instrument evidencing
the Obligations to the contrary notwithstanding; provided,
however, that notwithstanding the above, if there shall
occur an Event of Default under clause (g) or (h) above,
then the obligation of the Lenders to lend hereunder shall
automatically terminate and any and all of the Obligations
shall be immediately due and payable without the necessity
of any action by the Agent or the Required Lenders or
notice to the Agent or the Lenders; and
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(B) Borrowers shall, upon demand of Agent deposit
cash with the Agent in an amount equal to the amount of any
Letters of Credit and Acceptances remaining undrawn or
unpaid, as collateral security for the repayment of any
future drawings or payments under such Letters of Credit
and Acceptances, and Borrowers shall forthwith deposit and
pay such amounts and such amounts shall be held by Agent
pursuant to the terms of the LC/Acceptance Account
Agreement;
10.02 Agent to Act. In case any one or more Events of Default shall
occur and be continuing, the Agent and the Canadian Agent may, and at the
direction of the Required Lenders shall, proceed to protect and enforce their
rights or remedies either by suit in equity or by action at law, or both,
whether for the specific performance of any covenant, agreement or other
provision contained herein or in any other Loan Document, or to enforce the
payment of the Obligations or any other legal or equitable right or remedy.
10.03 Cumulative Rights. No right or remedy herein conferred upon the
Lenders or the Agents is intended to be exclusive of any other rights or
remedies contained herein or in any other Loan Document, and every such right or
remedy shall be cumulative and shall be in addition to every other such right or
remedy contained herein and therein or now or hereafter existing at law or in
equity or by statute, or otherwise.
10.04 No Waiver. No course of dealing between the Borrowers and any
Lender or the Agents or any failure or delay on the part of any Lender or the
Agents in exercising any rights or remedies hereunder shall operate as a waiver
of any rights or remedies hereunder and no single or partial exercise of any
rights or remedies hereunder shall operate as a waiver or preclude the exercise
of any other rights or remedies hereunder or of the same right or remedy on a
future occasion.
10.05 Default. The Agent and the Lenders shall have no right to
accelerate any of the Loans upon the occurrence of any Default which shall not
also constitute an Event of Default; provided, however, nothing contained in
this sentence shall in any respect impair or adversely affect the right, power
and authority of the Agent and the Lenders (i) to take any action expressly
required or permitted to be taken under the Loan Documents upon the occurrence
of any Default (and including any action or proceeding which the Agent may
determine to be necessary or appropriate in furtherance of any such expressly
authorized action) and (ii) to take any action provided under the Loan Documents
or otherwise available by statute, at law or in equity upon the occurrence of
any Default.
10.06 Allocation of Proceeds. If an Event of Default has occurred and is
continuing, and the maturity of the Notes has been accelerated pursuant to
Article X hereof, all payments received by
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the Agent or the Canadian Agent, or both, hereunder in respect of any principal
of or interest on the Obligations or any other amounts payable by the Borrowers
hereunder shall be applied by the Agent or Canadian Agent in the following
order:
(i) amounts due to the Agents, the Lenders, NationsBank
and CIBC pursuant to Sections 2.10, 2.22, 3.09, 3.17, 8.16, 12.06
and 12.13 hereof;
(ii) amounts due to (A) NationsBank pursuant to
Section 2.23, (B) CIBC pursuant to Section 3.18, and (C) the Agent
pursuant to Section 11.11 hereof;
(iii) payments of interest on Loans, to be applied for the
ratable benefit of the Lenders, without distinction or preference as between
Canadian Loans and Domestic Loans;
(iv) payments of principal on Loans, to be applied for
the ratable benefit of the Lenders, without distinction or
preference as between Canadian Loans and Domestic Loans;
(v) payment of cash amounts to the Agent for deposit to
the Borrower's Account pursuant to Section 10.01(B) hereof;
(vi) payment of Obligations owed Lenders pursuant to
Swap Agreements on a pro rata basis according to amounts owed; and
(vii) payments of all other amounts due under this Agreement and
the other Loan Documents, if any, to be applied in accordance with each Lender's
pro rata share of all principal due to the Lenders without distinction or
preference as between Canadian Loans and Domestic Loans.
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ARTICLE XI
The Agents
11.01 Appointment. Each Lender (including NationsBank in its capacity
as maker of Swing Line Loans and NationsBank and CIBC in their respective
capacities as issuers of the Letters of Credit and Acceptances) hereby
irrevocably designates and appoints NationsBank as the Agent of the Lenders and
CIBC as Canadian Agent for the Canadian Facilities Lenders under this Agreement,
and each of the Lenders hereby irrevocably authorizes NationsBank as the Agent
and CIBC as Canadian Agent for such Lender, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers as are expressly delegated to the Agent and Canadian Agent
by the terms of this Agreement, together with such other powers as are
reasonably incidental thereto. The Agent and Canadian Agent shall not have any
duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any of the Lenders, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or otherwise exist against the Agent and Canadian Agent.
11.02 Attorneys-in-fact. The Agent and Canadian Agent may execute any
of its duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent and Canadian Agent shall not be responsible for the gross
negligence or willful misconduct of any agents or attorneys-in-fact selected by
it with reasonable care.
11.03 Limitation on Liability. Neither of the Agents nor any of their
officers, directors, employees, agents or attorneys-in-fact shall be liable to
the Lenders for any action lawfully taken or omitted to be taken by it or them
under or in connection with this Agreement except for its or their own gross
negligence or willful misconduct. Neither of the Agents nor any of their
affiliates shall be responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by TDC, any of its
Subsidiaries, or any officer or representative thereof contained in this
Agreement or in any of the other Loan Documents, or in any certificate, report,
statement or other document referred to or provided for in or received by either
of the Agents under or in connection with this Agreement or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any of the other Loan Documents, or for any failure of any Borrower
or any Subsidiary to perform its obligations thereunder. The Agents shall not be
under any obligation to any of the Lenders to ascertain or to inquire as to the
observance or performance of any of the terms, covenants or conditions of this
Agreement or any of the other Loan Documents on the part of any Borrower or any
Subsidiary or to inspect the properties, books or records of TDC or its
Subsidiaries.
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11.04 Reliance. The Agents shall be entitled to rely, and shall be
fully protected in relying, upon any Note, writing, resolution, notice, consent
certificate, affidavit, letter, cablegram, telegram, telecopy or telex message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to TDC or any Subsidiary), independent accountants and other
experts selected by the Agent. The Agents may deem and treat the payee of any
Note as the owner thereof for all purposes unless an Assignment and Acceptance
shall have been filed with and accepted by the Agent. Each of the Agents shall
be fully justified in failing or refusing to take any action under this
Agreement unless it shall first receive advice or concurrence of the Lenders or
the Required Lenders as provided in this Agreement or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Agents shall in all cases be fully protected in acting, or
in refraining from acting, under this Agreement in accordance with a request of
the Required Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all present and
future holders of the Notes.
11.05 Notice of Default. The Agents shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Agent has received notice from a Lender, an Authorized
Representative or a Borrower or any of the Subsidiaries referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". In the event that the Agent receives such
notice, the Agent shall promptly give notice thereof to the Lenders. The Agents
shall take such action with respect to such Default or Event of Default as shall
be reasonably directed by the Required Lenders; provided that, unless and until
the Agents shall have received such directions, the Agents may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Event of Default as it shall deem advisable in the best interests of the
Lenders.
11.06 No Representations. Each Lender expressly acknowledges that
neither the Agents nor any of their affiliates has made any representations or
warranties to it and that no act by either of the Agents hereafter taken,
including any review of the affairs of TDC or any of its Subsidiaries, shall be
deemed to constitute any representation or warranty by either of the Agents to
any Lender. Each Lender represents to the Agents that it has, independently and
without reliance upon either of the Agents or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the financial condition, creditworthiness,
affairs, status and nature of TDC and its Subsidiaries and made its own decision
to enter into
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this Agreement. Each Lender also represents that it will, independently and
without reliance upon either of the Agents or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and to make such investigation as it
deems necessary to inform itself as to the status and affairs, financial or
otherwise, of TDC and its Subsidiaries. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agents
hereunder, the Agents shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the affairs, financial
condition or business of TDC or any of its Subsidiaries which may come into the
possession of the Agent or any of its affiliates.
11.07 Indemnification. The Lenders agree to indemnify the Agents in
their capacity as such (to the extent not reimbursed by TDC or any of its
Subsidiaries and without limiting any obligations of TDC or any of its
Subsidiaries so to do), ratably according to their respective Applicable
Commitment Percentages as then in effect (determined in the aggregate by
treating the Domestic Revolving Credit Facility and the Canadian Revolving
Credit Facility as a single credit facility for this purpose) from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may at any time (including without limitation at any time
following the payment of the Note) be imposed on, incurred by or asserted
against either of the Agents in any way relating to or arising out of this
Agreement or any other document contemplated by or referred to herein or the
transactions contemplated hereby or any action taken or omitted by either of the
Agents under or in connection with any of the foregoing; provided that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from either of the Agents' gross negligence or willful
misconduct. The agreements in this subsection shall survive the payment of the
Obligations and the termination of this Agreement.
11.08 Lender. The Agents and their affiliates may make loans to,
accept deposits from and generally engage in any kind of business with TDC and
its Subsidiaries as though it were not the Agent hereunder. With respect to its
Loans made or renewed by it and any Note issued to it, the Agents shall have the
same rights and powers under this Agreement as any Lender and may exercise the
same as though it were not the Agent, and the terms "Lender" and "Lenders"
shall, unless the context otherwise indicates, include the Agent in its
individual capacity.
11.09 Resignation. If either of the Agents shall resign as
an Agent under this Agreement, then the Required Lenders may
appoint a successor Agent or Canadian Agent, as the case may be,
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for the Lenders (and so long as no Default or Event of Default exists, a
successor acceptable to the Borrower), which, in the case of the Agent, shall be
a commercial bank organized or licensed under the laws of the United States or
any state thereof, and, in the case of the Canadian Agent, shall be a bank
organized under the laws of Canada or a province thereof, having a combined
surplus and capital of not less than $500,000,000, whereupon such successor
Agent or Canadian Agent, as the case may be, shall succeed to the rights, powers
and duties of the former Agent and the obligations of the former Agent shall be
terminated and canceled, without any other or further act or deed on the part of
such former Agent or any of the parties to this Agreement; provided, however,
that the former Agent's resignation shall not become effective until such
successor Agent has been appointed; provided, further, if the Required Lenders
(and so long as no Default or Event of Default has occurred, the Borrower)
cannot agree as to a successor Agent within ninety (90) days after such
resignation, the Agent or Canadian Agent, as the case may be, shall appoint a
successor Agent and the parties hereto agree to execute whatever documents are
necessary to effect such action under this Agreement or any other document
executed pursuant to this Agreement; provided, however in such event all
provisions of this Agreement and the Loan Documents, shall remain in full force
and effect. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article XI shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
11.10 Sharing of Payments, etc. Subject to the provisions of Section
10.06, each Lender agrees that if it shall, through the exercise of a right of
banker's lien, set-off, counterclaim or otherwise, obtain payment with respect
to its Obligations which results in its receiving more than its pro rata share
of the aggregate payments with respect to all of the Obligations which are to be
paid to any group of Lenders on a pro rata or ratable basis, then (A) such
Lender shall be deemed to have simultaneously purchased from the other Lenders a
share in their Obligations so that the amount of the Obligations held by each of
the Lenders shall be pro rata and (B) such other adjustments shall be made from
time to time as shall be equitable to insure that the Lenders share such
payments ratably; provided, however, that for purposes of this Section 11.10 the
term "pro rata" shall be determined with respect to both the Canadian Revolving
Credit Commitment or Domestic Revolving Credit Commitment, as applicable, of
each Lender and to the Total Canadian Revolving Credit Commitment or Total
Domestic Revolving Credit Commitment, as applicable, after subtraction in each
case of amounts, if any, by which any such Lender has not funded its share of
the outstanding Loans and Reimbursement Obligations. If all or any portion of
any such excess payment is thereafter recovered from the Lender which received
the same, the purchase provided in this Section 11.10 shall be rescinded to the
extent of such recovery, without interest. The Borrowers expressly consent to
the foregoing arrangements and agree that each Lender so purchasing a portion of
the other Lenders' Obligations may exercise
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all rights of payment (including, without limitation, all rights of set-off,
banker's lien or counterclaim) with respect to such portion as fully as if such
Lender were the direct holder of such portion.
11.11 Fees. The Borrowers agree to pay to each of the Agents, for its
individual account, an annual Agent's fee pursuant to the terms of fee letters
dated as of the date hereof among the Borrowers and the Agents. Such fees shall
be paid in quarterly installments in advance on the last day of each January,
April, July and October, the first such installment to be paid on the Closing
Date.
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ARTICLE XII
Miscellaneous
12.01 Assignments and Participations.
(a) At any time after the Closing Date each or any Lender may, with
the prior consent of the Agent and, so long as no Event of Default exists
hereunder, the Borrower, assign to one or more banks or financial institutions
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of the Notes payable to its order);
provided, that (i) each such assignment of rights and obligations in the
Canadian Facilities or the Multicurrency Facilities, respectively, shall be of a
constant, and not a varying, percentage of all of the assigning Lender's rights
and obligations (including Loans and Participations) under this Agreement with
respect to the Canadian Facilities or the Multicurrency Facilities, as
applicable, (ii) for each assignment involving the issuance and transfer of a
Note, the assigning Lender shall execute an Assignment and Acceptance and the
Borrowers hereby consent to execute as appropriate replacement Notes to give
effect to the assignment, (iii) each Canadian Facilities Lender must also be a
Multicurrency Facilities Lender after giving effect to any assignment hereunder,
(iv) the minimum Canadian Revolving Credit Commitment or Domestic Revolving
Credit Commitment which shall be assigned is $10,000,000 (together with which
the assigning Lender's applicable portion of Participations and the Canadian
Letter of Credit Commitment or Domestic Letter of Credit Commitment, as
applicable, shall also be assigned) and (v) such assignee shall have an office
located in the United States, provided, that an assignment by NationsBank shall
not include any portion of the Swing Line. Upon such execution, delivery,
approval and acceptance, from and after the effective date specified in each
Assignment and Acceptance, (x) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder or under such Notes
have been assigned or negotiated to it pursuant to such Assignment and
Acceptance have the rights and obligations of a Lender hereunder and a holder of
such Notes and (y) the assignor thereunder shall, to the extent that rights and
obligations hereunder or under such Notes have been assigned or negotiated by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement. No assignee shall have the
right to further assign its rights and obligations pursuant to this Section
12.01. Any Lender who makes an assignment shall pay to the Agent a one-time
administrative fee of $3,500.00 which fee shall not be reimbursed by the
Borrowers.
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) the assignment made
under such Assignment and Acceptance is made under such Assignment and
Acceptance without
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recourse against the assignor; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of TDC or any Subsidiary or the performance or observance by
TDC or any Subsidiary of any of its obligations under any Loan Document or any
other instrument or document furnished pursuant hereto; (iii) such assignee
confirms that it has received a copy of this Agreement, together with copies of
the financial statements most recently made available whether pursuant to
Section 7.02(c) or Section 8.01 and such other Loan Documents and other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Agent, such assigning
Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement, the Notes and the other Loan Documents as are
delegated to the Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vi) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a Lender and a
holder of such Notes.
(c) The Agent shall maintain at its address referred to herein a copy
of each Assignment and Acceptance delivered to and accepted by it.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, the Agent shall give prompt notice thereof to the Borrowers.
(e) Each Lender may sell participations to one or more banks or other
entities as to all or a portion of its rights and obligations under this
Agreement; provided, that (i) such Lender's obligations under this Agreement
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, (iii) such Lender
shall remain the holder of any Note issued to it for the purpose of this
Agreement, (iv) such participations shall be in a minimum amount of $2,500,000
and shall include an allocable portion of such Lender's Participation, and (v)
the Borrowers, the Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and with regard to any and all payments to be
made under this Agreement; provided, that the participation agreement between a
Lender and its participants may provide that such Lender will obtain the
approval of such participant prior to such Lender's agreeing to any amendment or
waiver of any provisions of this Agreement which would (A) extend the maturity
of any Note, (B) reduce the interest rate hereunder, or (C) increase the
Canadian
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Revolving Credit Commitment or Domestic Revolving Credit Commitment of the
Lender granting the participation other than as permitted by Section 2.11 or
Section 3.10, and (vi) the sale of any such participations which require any
Borrower to file a registration statement with the United States Securities and
Exchange Commission or under the securities regulations or laws of any state
shall not be permitted.
(f) Notwithstanding anything to the contrary contained herein or in
any of the other Loan Documents, any Lender may assign all or any portion of its
rights and obligations under the Loan Documents and the Notes to any affiliate
of such Lender, and any Lender may pledge all or any portion of its interest
under the Loan Documents and the Notes to the members of the Federal Reserve
Bank as security for obligations of such Lender to the Board, without the
consent of the Borrower, the Agent or any other Lender and without the payment
of the administrative fee referred to in Section 12.01(a) so long as such
assignment does not result in any withholding tax or other increased cost for
the Borrowers.
12.02 Notices. Any notice shall be conclusively deemed to have been
received by any party hereto and be effective on the day on which delivered to
such party (against receipt therefor) at the address set forth below or such
other address as such party shall specify to the other parties in writing (or,
in the case of telephonic notice or notice by telecopy, telegram or telex (where
the receipt of such message is verified by return) expressly provided for
hereunder, when received at such telephone, telecopy or telex number as may from
time to time be specified in written or verbal notice to the other parties
hereto or otherwise received), or if sent prepaid by certified or registered
mail return receipt requested on the third Business Day after the day on which
mailed, addressed to such party at said address:
(a) if to any Borrower:
Tech Data Corporation
5350 Tech Data Drive
Clearwater, Florida 34620
Attention: Chief Financial Officer
Telefacsimile: 813-538-5860
Telephone: 813-538-7825
(b) if to the Authorized Representative:
at the address set forth for
receipt of notices in the
notice of appointment thereof.
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(c) if to the Agent:
NationsBank, National Association
901 Main Street, 67th Floor
Dallas, Texas 75202
Attention: Yousuf Omar/Lori Stone
Telefacsimile: 214-508-0980
Telephone: 214-508-3347
with a copy to:
NationsBank, National Association
Independence Center
Charlotte, North Carolina 28255
Attention: Agency Services
Telefacsimile: 704-386-9923
Telephone: 800-788-7125
(d) if to NationsBank in its capacity as issuer of
the Domestic Letters of Credit or Domestic
Acceptances:
NationsBank, National Association
901 Main Street, 9th Floor
Dallas, Texas 75202
Attention: Alan Hanna,
Letter of Credit Department
Telefacsimile: 214-508-1814
Telephone: 214-508-3606
(e) if to the Canadian Agent:
Canadian Imperial Bank of Commerce
Head Office
Commerce Court West, 7th Floor
Toronto Ontario M5L 1A2
Attention: Manager Agent Administration
Telefacsimile: 416-980-5151
Telephone: 416-980-4077
(f) If to CIBC in its capacity as issuer of the
Canadian Letters of Credit or Canadian
Acceptances:
Canadian Imperial Bank of Commerce
Corporate Client Support Center
Commerce Court West, 50th Floor
Toronto, Ontario M5L 1A2
Attention: Associate
Telefacsimile: 416-980-5855
Telephone: 416-214-8417
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(g) if to the Lenders:
At the addresses set forth on the signature pages
hereof and on the signature page of each
Assignment and Acceptance
(h) if to any other Subsidiary signatory to a
Guaranty, at the address of such Subsidiary
provided in such Guaranty.
12.03 No Waiver. No failure or delay on the part of the Agent or any
Lender in the exercise of any right, power or privilege hereunder shall operate
as a waiver of any such right, power or privilege nor shall any such failure or
delay preclude any other or further exercise thereof. The rights and remedies
herein provided are cumulative and not exclusive of any rights or remedies
provided by law.
12.04 Setoff. Each Borrower agrees that the Agents and each Lender
shall have a right of setoff for all the Obligations of such Borrower against
all deposits or deposit accounts, of any kind, or any interest in any deposits
or deposit accounts thereof, now or hereafter pledged, mortgaged, transferred or
assigned to the Agent or such Lender or otherwise in the possession or control
of the Agents or such Lender (other than for safekeeping or collateral accounts
for other Persons) for any purpose for the account or benefit of such Borrower
and including any balance of any deposit account or of any credit of such
Borrower with either of the Agents or such Lender, whether now existing or
hereafter established, hereby authorizing the Agents and each Lender at any time
or times with or without prior notice to apply such balances or any part thereof
to such of the Obligations of such Borrower to the Lenders then past due and in
such amounts as they may elect, and whether or not the collateral or the
responsibility of other Persons primarily, secondarily or otherwise liable may
be deemed adequate. For the purposes of this paragraph, all remittances and
property shall be deemed to be in the possession of the Agent or such Lender as
soon as the same may be put in transit to it by mail or carrier or by other
bailee.
12.05 Survival. All covenants, agreements, representations and
warranties made herein shall survive the making by the Lenders of the Loans and
the expiration of the Letters of Credit and Acceptances and the execution and
delivery to the Lenders of this Agreement and the Notes and shall continue in
full force and effect so long as any of Obligations remain outstanding or any
Lender has any commitment hereunder. Whenever in this Agreement, any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and permitted assigns of such party and all covenants, provisions and
agreements by or on behalf of the Borrower which are contained in this Agreement
and the Notes shall inure to the benefit of the successors and permitted assigns
of the
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Lenders or any of them. No Borrower shall assign any of its rights or
obligations hereunder without the consent of all Lenders.
12.06 Expenses. The Borrowers jointly and severally agree (a) to pay
or reimburse the Agents for all its reasonable and customary out-of-pocket costs
and expenses (including travel and copy expenses) incurred in connection with
the preparation, negotiation and execution of, and any amendment, supplement or
modification to, this Agreement or any of the other Loan Documents, and the
consummation of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable and customary fees and disbursements of
counsel to the Agents, (b) to pay or reimburse the Agents and the Lenders for
all their costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, including without limitation,
the reasonable fees and disbursements of their counsel, (c) to pay, indemnify
and hold the Agents and the Lenders harmless from any and all recording and
filing fees and any and all liabilities with respect to, or resulting from any
failure to pay or delay in paying, documentary, stamp, excise and other similar
taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation of any amendment, supplement
or modification of, or any waiver or consent under or in respect of, this
Agreement, and (d) to pay, indemnify, and hold the Agents and the Lenders
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement or in any respect
relating to the transactions contemplated hereby or thereby, (all the foregoing,
collectively, the "indemnified liabilities"); provided, however, that the
Borrowers shall have no obligation hereunder with respect to indemnified
liabilities arising from (i) the willful misconduct or gross negligence of the
party seeking indemnification, (ii) legal proceedings commenced against either
of the Agents or any Lender by any security holder or creditor thereof arising
out of and based upon rights afforded any such security holder or creditor
solely in its capacity as such, (iii) any taxes imposed upon either of the
Agents or any Lender other than the documentary, stamp, excise and similar taxes
described in clause (c) above or any tax resulting from any Regulatory Change,
which tax would be payable to Lenders by any Borrower pursuant to Article IV
hereof, (iv) taxes imposed as a result of a transfer or assignment of any Note,
participation or assignment of a portion of its rights or (v) any taxes imposed
upon any transferee of any Note. The agreements in this subsection shall survive
repayment of the Notes and all other Obligations hereunder.
12.07 Amendments. No amendment, modification or waiver of any
provision of this Agreement or any of the Loan Documents and no consent by the
Lenders to any departure therefrom by any Borrower shall be effective unless
such amendment, modification or waiver
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shall be in writing and signed by the Agent, but only upon having received the
written consent of the Required Lenders, and the same shall then be effective
only for the period and on the conditions and for the specific instances and
purposes specified in such writing; provided, however, that, no such amendment,
modification or waiver
(i) which changes, extends or waives any provision of
Section 11.10 or this Section 12.07, the amount of or the due date of
any scheduled installment of or the rate of interest payable on any
Obligation, changes the definition of Required Lenders, which
increases or extends the Canadian Revolving Credit Commitment or
Domestic Revolving Credit Commitment of any Lender or which increase
or extends the Canadian Letter of Credit Facility or the Domestic
Letter of Credit Facility or the maximum amount of Competitive Bid
Loans or which waives any condition to the making of any Loan shall
be effective unless in writing and signed by each of the Lenders;
provided, however, the Required Lenders may in their sole discretion
waive any Default or Event of Default (other than any Event of
Default under Section 10.01(a) or (b));
(ii) which releases a Borrower or any Subsidiary from its
Guaranty (other than in accordance with the terms of the Loan
Documents) shall be effective unless with the written consent of each
of the Lenders;
(iii) which affects the rights, privileges, immunities or
indemnities of the Agent, shall be effective unless in writing and
signed by the Agent; or
(iv) which affects the rights, privileges, immunities or
indemnities of NationsBank or CIBC as maker of Swing Line Loans,
issuer of Letters of Credit and issuer of Acceptances, as applicable,
shall be effective unless with the written consent of NationsBank or
CIBC, as applicable.
Notwithstanding any provision of the other Loan Documents to the contrary, as
between the Agent and the Lenders, execution by the Agent shall not be deemed
conclusive evidence that the Agent has obtained the written consent of the
Required Lenders. No notice to or demand on any Borrower in any case shall
entitle such Borrower to any other or further notice or demand in similar or
other circumstances, except as otherwise expressly provided herein. No delay or
omission on any Lender's or the Agent's part in exercising any right, remedy or
option shall operate as a waiver of such or any other right, remedy or option or
of any Default or Event of Default.
12.08 Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and
delivered shall be deemed an original, and it shall not be
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necessary in making proof of this Agreement to produce or account for more than
one such fully-executed counterpart.
12.09 Waivers by Borrowers. In any litigation in any court with
respect to, in connection with, or arising out of this Agreement, the Loans, any
of the Notes, any of the other Loan Documents, the Obligations, or any
instrument or document delivered pursuant to this Agreement, or the validity,
protection, interpretation, collection or enforcement thereof, or any other
claim or dispute howsoever arising between the Borrower and the Lenders or the
Agent, (i) each Borrower hereby waives the right to interpose any setoff,
recoupment, counterclaim or cross-claim in connection with any such litigation,
irrespective of the nature of such setoff, recoupment, counter-claim or
cross-claim unless such setoff, recoupment, counter-claim or cross-claim could
not, by reason of any applicable federal, state or province procedural laws, be
interposed, pleaded or alleged in any other action and (ii) the Borrower and
each Lender and the Agent hereby, to the maximum extent permitted by applicable
law, waive trial by jury in connection with any such litigation.
12.10 Termination. The termination of this Agreement shall not affect
any rights of the Borrowers, the Lenders or the Agents or any obligation of any
Borrower, the Lenders or either of the Agents, arising prior to the effective
date of such termination, and the provisions hereof shall continue to be fully
operative until all transactions entered into or rights created or obligations
incurred prior to such termination have been fully disposed of, concluded or
liquidated and the Obligations arising prior to or after such termination have
been irrevocably paid in full. The rights granted to the Agents for the benefit
of the Lenders hereunder and under the other Loan Documents shall continue in
full force and effect, notwithstanding the termination of this Agreement, until
all of the Obligations have been paid in full after the termination hereof or
the Borrowers have furnished the Lenders and the Agent with an indemnification
satisfactory to the Agents and each Lender with respect thereto. All
representations, warranties, covenants, waivers and agreements contained herein
shall survive termination hereof until payment in full of the Obligations unless
otherwise provided herein. Notwithstanding the foregoing, if after receipt of
any payment of all or any part of the Obligations, any Lender is for any reason
compelled to surrender such payment to any Person because such payment is
determined to be void or voidable as a preference, impermissible setoff, a
diversion of trust funds or for any other reason, this Agreement shall continue
in full force and the Borrowers shall be liable to, and shall indemnify and hold
such Lender harmless for, the amount of such payment surrendered until such
Lender shall have been finally and irrevocably paid in full. The provisions of
the foregoing sentence shall be and remain effective notwithstanding any
contrary action which may have been taken by the Lenders in reliance upon such
payment, and any such contrary action so taken shall be without prejudice to the
Lenders' rights under this
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Agreement and shall be deemed to have been conditioned upon such payment having
become final and irrevocable.
12.11 Governing Law.
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN
THOSE LOAN DOCUMENTS WHICH EXPRESSLY PROVIDE THAT THEY SHALL BE
GOVERNED BY THE LAWS OF ANOTHER JURISDICTION) SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA
APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH
STATE. NOTWITHSTANDING THE FOREGOING, TO THE EXTENT THAT ANY ACTION,
SUIT OR PROCEEDING IS BROUGHT AGAINST TD CANADA WITHIN CANADA, THEN
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF ONTARIO AND THE FEDERAL LAWS OF CANADA APPLICABLE
THEREIN.
(b) EACH BORROWER HEREBY EXPRESSLY AND IRREVOCABLY AGREES
AND CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN
MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE
COUNTIES OF PINELLAS OR HILLSBOROUGH, STATE OF FLORIDA, UNITED STATES
OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
BORROWER EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE IN, OR TO THE EXERCISE OF JURISDICTION
OVER IT AND ITS PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT, ACTION
OR PROCEEDING, AND EACH BORROWER HEREBY IRREVOCABLY SUBMITS GENERALLY
AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH
SUIT, ACTION OR PROCEEDING.
(c) EACH BORROWER AGREES THAT SERVICE OF PROCESS MAY BE
MADE BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR
OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY
REGISTERED OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF THE
BORROWER PROVIDED IN SECTION 12.02, ATTENTION GENERAL COUNSEL OR BY
ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN
EFFECT IN THE STATE OF FLORIDA.
(d) NOTHING CONTAINED IN SUBSECTIONS (a) OR (b) HEREOF
SHALL PRECLUDE THE AGENT OR ANY LENDER FROM BRINGING ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT IN THE
COURTS OF ANY JURISDICTION WHERE ANY BORROWER OR ANY BORROWER'S
PROPERTY OR ASSETS MAY BE FOUND OR LOCATED. TO THE EXTENT PERMITTED
BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, EACH BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT AND
EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING,
OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY
ANY SUCH OTHER COURT OR COURTS WHICH NOW OR HEREAFTER MAY BE
AVAILABLE UNDER APPLICABLE LAW.
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12.12 Representation and Warranty of the Lenders. Each Lender hereby
represents that no part of any funds used by such Lender to fund any Loan or
other extension of credit to the Borrowers made by it constitutes or will
constitute assets allocated to any "separate account" maintained by such Lender.
As used herein, the term "separate account" shall have the meaning assigned to
such term in Section 3 of ERISA.
12.13 Indemnification. In consideration of the execution and delivery
of this Agreement by the Agents and each Lender and the extension of the
Canadian Facilities and the Multicurrency Facilities, each Borrower hereby
jointly and severally indemnifies, exonerates and holds the Agent, the Canadian
Agent and each Lender and each of their respective officers, directors,
employees and agents (collectively, the "Indemnified Parties") free and harmless
from and against any and all actions, causes of action, suits, losses, costs,
liabilities and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to the action for
which indemnification hereunder is sought), including reasonable attorneys' fees
and disbursements (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole
or in part, directly or indirectly, with the proceeds of any
Loan or supported by any Letter of Credit or Acceptance;
(b) the entering into and performance of this Agreement
and any other Loan Document by any of the Indemnified Parties;
(c) any investigation, litigation or proceeding related to
any environmental cleanup, audit, compliance or other matter relating
to the protection of the environment or the release by TDC or any of
its Subsidiaries of any Hazardous Material; or
(d) the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, discharging or releases from,
any real property owned or operated by TDC or any Subsidiary thereof
of any Hazardous Material (including any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused by, or
within the control of, TDC or such Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or willful misconduct, and if and to the extent that the foregoing
undertaking may be unenforceable for any reason, the Borrowers hereby agree to
make the maximum contribution to the payment and satisfaction of each of
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the Indemnified Liabilities which is permissible under applicable
law.
12.14 Agreement Controls. In the event that any term of any of the
Loan Documents other than this Agreement conflicts with any term of this
Agreement, the terms and provisions of this Agreement shall control.
12.15 Severability. If any provision of this Agreement or the other
Loan Documents shall be determined to be illegal or invalid as to one or more
parties hereto, then such provision shall remain in effect with respect to all
parties, if any, as to whom such provision is neither illegal nor invalid, and
in any event all other provisions hereof shall remain effective and binding on
the parties hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be made, executed and delivered by their duly authorized officers as of the day
and year first above written.
WITNESS: TECH DATA CORPORATION
R. Malloy McKeithen
- -----------------------
Wade M. Kennedy By:/s/ JEFFERY P. HOWELLS
- ----------------------- Name: Jeffery P. Howells
Title: Senior Vice President
of Finance and Chief
Financial Officer
WITNESS: TECH DATA FRANCE, S.N.C.
R. Malloy McKeithen
- -----------------------
Wade M. Kennedy By:/s/ JEFFERY P. HOWELLS
- ----------------------- Name: Jeffery P. Howells
Title: Managing Director
WITNESS: TECH DATA CANADA INC.
R. Malloy McKeithen
- -----------------------
Wade M. Kennedy By:/s/ JEFFERY P. HOWELLS
- ----------------------- Name: Jeffery P. Howells
Title: Secretary and Chief
Financial Officer
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NATIONSBANK, NATIONAL ASSOCIATION,
as Agent for the Lenders
By: /s/ NANCY J. PEARSON
Name: Nancy J. Pearson
Title: Senior Vice President
NATIONSBANK, NATIONAL ASSOCIATION
By:/s/ NANCY J. PEARSON
Name: Nancy J. Pearson
Title: Senior Vice President
Lending Office: NationsBank Plaza
901 Main Street, 67th Floor
Dallas, Texas 75202
Wire Transfer Instructions:
NationsBank, National Association
Dallas, Texas
ABA# 111000025
Reference Tech Data Corporation
Attention: Corporate Credit Support
Account No.: 136621-2163
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CANADIAN IMPERIAL BANK OF COMMERCE,
as Domestic Facilities Lender
By:/S/ KIM FREDERKING
Name: Kim Frederking
Title: Director
Domestic Lending Office
Two Paces West
2727 Paces Ferry Road
Suite 1200
Atlanta Georgia 30339
CANADIAN IMPERIAL BANK OF COMMERCE
as Canadian Agent
By:/S/ M. WARREN LOBO
Name: M. Warren Lobo
Title: Associate
CANADIAN IMPERIAL BANK OF COMMERCE
as Canadian Facilities Lender
By:/S/ MAURO SPAGNOLO
Name: Mauro Spagnolo
Title: Director
Lending Office:
Corporate Client Support Center
Commerce Court West, 50th Floor
Toronto, Ontario M5L 1A2
Wire Transfer Instruction:
Corporate Client Support Centre
Canadian Imperial Bank of Commerce
Transit #00002
Swiftcode-CIBCCATT
CCSC Suspense
Account Number: Cdn$ 09-55515
US$ 05-42016
Attention: Jennie Harris
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NBD BANK
By:/S/ RICHARD C. ELLIS
Name: Richard C. Ellis
Title: Vice President
Lending Office:
611 Woodward Avenue
Detroit, Michigan 48226
Wire Transfer Instructions:
NBD Bank
Detroit, Michigan
ABA# 072000326
Reference: Tech Data Corporation
Loan No. 2754042
Attention: Commercial Loan
Department
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THE BANK OF NOVA SCOTIA
By: /S/ FRANK F. SANDLER
Name: Frank F. Sandler
Title: Relationship Manager
Lending Office:
600 Peachtree Street, N.E.
Suite 2700
Atlanta, Georgia 30308
Wire Transfer Instructions:
The Bank of Nova Scotia, New York Agency
New York, New York 10006
ABA# 026002532
Reference: Tech Data Corporation
For further credit to: Atlanta Agency
Attention: Cleve Bushey
Account No.: 0606634
THE BANK OF NOVA SCOTIA
By: /S/ P.J. ARMSTRONG
Name: P.J. Armstrong
Title: Senior Account Manager
Lending Office:
Etobicoke Commercial Banking Centre
195 The West Mall, Suite 100
Etobicoke, Ontario
Wire Transfer Instruction:
The Bank of Nova Scotia
Etobicoke, Ontario
ABA# BANK 002
Account No.: TRANSIT #22822
Reference: Tech Data Corporation
Attention: Phillip J. Armstrong
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BARNETT BANK OF PINELLAS COUNTY
By: /S/ MICHAEL S CROWE
Name: Michael S Crowe
Title:Senior Vice President
Lending Office:
One Progress Plaza
Suite 1800
St. Petersburg, Florida 33701
Wire Transfer Instructions:
Barnett Bank of Pinellas County
Clearwater, Florida 34615
ABA# 063106129
Acct. #02688534532
Reference: Tech Data Corporation
Attention: Commercial Loan Accounting
Deborah A. Harris or
Bonita Haley
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CREDIT LYONNAIS NEW YORK BRANCH
By: /S/ ALAIN PAPIASSE
Name: Alain Papiasse
Title: Executive Vice President
CREDIT LYONNAIS ATLANTA AGENCY
By:/S/ ALAIN PAPIASSE
Name: Alain Papiasse
Title: Executive Vice President
Lending Office:
303 Peachtree Street, N.E.
Suite 4400
Atlanta, Georgia 30308
Wire Transfer Instruction:
Credit Lyonnais New York Branch
New York, New York 10019
For further credit to:
Credit Lyonnais Atlanta Agency
ABA# 0260-0807-3
Account No.: 01.24173.0001.00
Reference: Tech Data
Attention: Loan Servicing
142
<PAGE>
ROYAL BANK OF CANADA
By: /S/ MICHAEL A. COLE
Name: Michael A. Cole
Title: Senior Manager
Lending Office:
600 Wilshire Boulevard
Suite 800
Los Angeles, California 90017
Wire Transfer Instructions:
Chase Manhattan Bank
New York, New York
ABA# 021000021
Account No. 920-01-033363
Account Name: Royal Bank of Canada
New York
For further credit to Account No.:
218-599-9
143
<PAGE>
PNCBank, KY, Inc.
By: /S/ JAMES D. NEIL
Name: James D. Neil
Title: Vice President
Lending Office:
500 W. Jefferson Street
Louisville, Kentucky 40202
Wire Transfer Instruction:
PNCBank, KY, Inc.
ABA# 083000108
Reference: Tech Data
Attention: Commercial Loan Operations
Account No.: 3000991434
144
<PAGE>
SOUTHTRUST BANK OF ALABAMA,
NATIONAL ASSOCIATION
By: /S/ MARK WELLNER
Name: Mark Wellner
Title: Vice President
Lending Office:
150 2nd Avenue, North
Suite 450
St. Petersburg, Florida 33701
Wire Transfer Instruction:
SouthTrust Bank of Alabama,
National Association
Birmingham, Alabama
ABA# 062000080
Reference: for credit to Tech Data
Corporation
Customer No. 5147575
Attention: SE Banking
(205) 254-5698
145
<PAGE>
FIRST UNION NATIONAL BANK OF FLORIDA
By: /S/ JEFFREY E. NOLL
Name: Jeffrey E. Noll
Title: Vice President
Lending Office:
214 Hogan Street
Jacksonville, Florida 32202
Wire Transfer Instruction:
First Union National Jacksonville
Jacksonville, Florida
ABA# 063-000-021
In favor of: First Union National
Bank of Florida
Reference: Tech Data Corporation
Attention: Alice Ricker
146
<PAGE>
DEUTSCHE BANK AG NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /S/ RALF HOFFMANN
Name: Ralf Hoffmann
Title:Vice President
By: /S/ ROBERT M. WOOD
Name: Robert M. Wood
Title:Vice President
Lending Office:
31 West 52nd Street
New York, New York 10019
Wire Transfer Instruction:
Deutsche Bank AG New York Branch
New York, New York 10019
ABA# 026003780
Reference: Tech Data Corporation
Attention: John Quinn
147
<PAGE>
THE SAKURA BANK, LIMITED, ATLANTA AGENCY
By: /S/ HIROVASH MANISHI
Name:Hirovash Manishi
Title:Vice President & Senior Mgr
Lending Office:
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Wire Transfer Instruction:
Morgan Guaranty Trust Co. of
New York
New York, New York
ABA# 021 000 238
Account Name: The Sakura Bank, Ltd.,
New York
Account Number: 631-22-624
In favor of: MTKB, Atlanta
A/C 9000100-1
148
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Tech Data Corporation for the period ended April 30,
1996 and is qualified in its entirety by reference to such financial statements
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-1997
<PERIOD-START> FEB-01-1996
<PERIOD-END> APR-30-1996
<CASH> 919
<SECURITIES> 0
<RECEIVABLES> 510,305
<ALLOWANCES> 24,008
<INVENTORY> 430,695
<CURRENT-ASSETS> 952,290
<PP&E> 60,366
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,043,294
<CURRENT-LIABILITIES> 734,136
<BONDS> 0
0
5
<COMMON> 57
<OTHER-SE> 300,048
<TOTAL-LIABILITY-AND-EQUITY> 1,043,294
<SALES> 985,574
<TOTAL-REVENUES> 985,574
<CGS> 916,562
<TOTAL-COSTS> 962,847
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,523
<INCOME-PRETAX> 17,204
<INCOME-TAX> 6,776
<INCOME-CONTINUING> 10,428
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,428
<EPS-PRIMARY> .27
<EPS-DILUTED> .27
</TABLE>
