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Exhibit 10.1
REVOLVING CREDIT AGREEMENT
dated as of June 26, 2000
STAPLES, INC.
THE BANKS NAMED HEREIN,
FLEET NATIONAL BANK,
AS AGENT
WITH
FLEETBOSTON ROBERTSON STEPHENS INC.
HAVING ACTED AS ARRANGER
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TABLE OF CONTENTS
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SECTION 1. DEFINITIONS AND RULES OF INTERPRETATION.............................................................................1
SECTION 1.1. Definitions.......................................................................................1
SECTION 1.2. Rules of Interpretation..........................................................................14
SECTION 2. THE REVOLVING CREDIT FACILITY......................................................................................14
SECTION 2.1. Commitment to Lend Revolving Credit Loans........................................................15
SECTION 2.2. Requests for Revolving Credit Loans..............................................................15
SECTION 2.3. Funds for Revolving Credit Loans.................................................................16
SECTIONS 2.3.1. Funding Procedures...............................................................16
SECTIONS 2.3.2. Advances by Agent................................................................16
SECTION 2.4. The Revolving Credit Notes.......................................................................17
SECTION 2.5. Reduction of Total Commitment....................................................................17
SECTION 2.6. Mandatory Repayments of Revolving Credit Loans...................................................17
SECTION 2.7. Optional Repayments of Revolving Credit Loans....................................................18
SECTION 2.8. Interest On Revolving Credit Loans...............................................................18
SECTION 2.9. Conversion Options...............................................................................19
SECTION 2.9.1. Conversion to Different Type of Revolving Credit Loan............................19
SECTION 2.9.2. Continuation of Type of Revolving Credit Loan....................................19
SECTION 2.9.3. Eurodollar Rate Loans............................................................19
SECTION 3. CERTAIN GENERAL PROVISIONS; FEES...................................................................................20
SECTION 3.1. Agent Fees.......................................................................................20
SECTION 3.2. Facility Fee.....................................................................................20
SECTION 3.3. Funds For Payments...............................................................................20
SECTION 3.3.1. Payments to Agent................................................................20
SECTION 3.3.2. No Offset, Etc...................................................................20
SECTION 3.3.3. Withholding......................................................................21
SECTION 3.4. Computations.....................................................................................21
SECTION 3.5. Inability to Determine Eurodollar Rate...........................................................21
SECTION 3.6. Illegality.......................................................................................21
SECTION 3.7. Additional Costs, Etc............................................................................22
SECTION 3.8. Capital Adequacy.................................................................................23
SECTION 3.9. Certificate......................................................................................24
SECTION 3.10. Indemnity........................................................................................24
SECTION 3.11. Interest On Overdue Amounts......................................................................24
SECTION 3.12. Replacement of Individual Banks..................................................................24
SECTION 3.13. Guaranties.......................................................................................25
SECTION 4. REPRESENTATIONS AND WARRANTIES.....................................................................................25
SECTION 4.1. Corporate Authority..............................................................................25
SECTIONS 4.1.1. Incorporation; Good Standing....................................................25
SECTIONS 4.1.2. Authorization...................................................................26
SECTIONS 4.1.3. Enforceability..................................................................26
SECTION 4.2. Governmental Approvals...........................................................................26
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SECTION 4.3. Title to Properties; Leases......................................................................26
SECTION 4.4. Financial Statements.............................................................................27
SECTION 4.5. No Material Changes, Etc.........................................................................27
SECTION 4.6. Franchises, Patents, Copyrights, Etc.............................................................27
SECTION 4.7. Litigation.......................................................................................27
SECTION 4.8. Compliance With Other Instruments, Laws, Etc.....................................................28
SECTION 4.9. Tax Status.......................................................................................28
SECTION 4.10. No Event of Default..............................................................................28
SECTION 4.11. Holding Company and Investment Company Acts......................................................28
SECTION 4.12. Employee Benefit Plans...........................................................................28
SECTION 4.12.1. In General.....................................................................28
SECTION 4.12.2. Terminability of Welfare Plans.................................................29
SECTION 4.12.3. Guaranteed Pension Plans.......................................................29
SECTION 4.12.4. Multiemployer Plans............................................................29
SECTION 4.13. Regulations U and X; Etc.........................................................................29
SECTION 4.14. Environmental Compliance.........................................................................30
SECTION 4.15. Subsidiaries, Etc................................................................................30
SECTION 5. AFFIRMATIVE COVENANTS OF THE BORROWER..............................................................................31
SECTION 5.1. Punctual Payment.................................................................................31
SECTION 5.2. Maintenance of Office............................................................................31
SECTION 5.3. Records and Accounts.............................................................................31
SECTION 5.4. Financial Statements, Certificates and Information...............................................31
SECTION 5.5. Notices..........................................................................................32
SECTION 5.6. Corporate Existence; Maintenance of Properties...................................................33
SECTION 5.7. Insurance........................................................................................33
SECTION 5.8. Taxes............................................................................................33
SECTION 5.9. Inspection of Properties and Books, Etc..........................................................34
SECTION 5.10. Compliance with Laws, Contracts, Licenses, and Permits...........................................34
SECTION 5.11. Employee Benefit Plans...........................................................................35
SECTION 5.12. Use of Proceeds..................................................................................35
SECTION 5.13. Licenses and Permits.............................................................................35
SECTION 5.14. Further Assurances...............................................................................35
SECTION 6. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.........................................................................35
SECTION 6.1. Restrictions on Indebtedness......................................................................35
SECTION 6.2. Restrictions on Liens.............................................................................38
SECTION 6.3. Restrictions on Investments.......................................................................39
SECTION 6.4. Distributions.....................................................................................41
SECTION 6.5. Employee Benefit Plans............................................................................41
SECTION 6.6. Merger and Consolidation..........................................................................42
SECTION 6.7. Disposition of Assets and Sale-leaseback Transactions.............................................42
SECTION 6.8. Subordinated Debt.................................................................................43
SECTION 7. FINANCIAL COVENANTS OF THE BORROWER................................................................................43
SECTION 7.1. Fixed Charge Coverage Ratio.......................................................................43
SECTION 7.2. Funded Debt to Ebitda Ratio.......................................................................43
SECTION 7.3. Minimum Consolidated Tangible Net Worth...........................................................44
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SECTION 8. CLOSING CONDITIONS.................................................................................................44
SECTION 8.1. Loan Documents....................................................................................44
SECTION 8.2. Certified Copies of Charter Documents.............................................................44
SECTION 8.3. Corporate Action..................................................................................44
SECTION 8.4. Incumbency Certificate............................................................................44
SECTION 8.5. Opinion of Counsel................................................................................44
SECTION 8.6. Payment of Fees...................................................................................45
SECTION 8.7. Compliance Certificate............................................................................45
SECTION 8.8. No Material Adverse Change........................................................................45
SECTION 9. CONDITIONS TO ALL BORROWINGS.......................................................................................45
SECTION 9.1. Representations True; No Event of Default.........................................................45
SECTION 9.2. No Legal Impediment...............................................................................45
SECTION 9.3. Governmental Regulation...........................................................................45
SECTION 9.4. Proceedings and Documents.........................................................................45
SECTION 10. EVENTS OF DEFAULT; ACCELERATION; ETC...............................................................................46
SECTION 10.1. Events of Default and Acceleration................................................................46
SECTION 10.2. Termination of Commitments........................................................................49
SECTION 10.3. Remedies..........................................................................................49
SECTION 11. SETOFF.............................................................................................................49
SECTION 12. THE AGENT..........................................................................................................50
SECTION 12.1. Authorization....................................................................................50
SECTION 12.2. Employees and Agents.............................................................................51
SECTION 12.3. No Liability.....................................................................................51
SECTION 12.4. No Representations...............................................................................51
SECTION 12.5. Payments.........................................................................................52
SECTION 12.5.1. Payments to Agent..............................................................52
SECTION 12.5.2. Distribution by Agent..........................................................52
SECTION 12.5.3. Delinquent Banks...............................................................52
SECTION 12.6. Holders of Revolving Credit Notes................................................................53
SECTION 12.7. Indemnity........................................................................................53
SECTION 12.8. Agent as Bank; Etc...............................................................................53
SECTION 12.9. Resignation......................................................................................53
SECTION 12.10. Notification of Defaults and Events of Default...................................................53
SECTION 13. EXPENSES...........................................................................................................54
SECTION 14. INDEMNIFICATION....................................................................................................54
SECTION 15. SURVIVAL OF COVENANTS, ETC.........................................................................................55
SECTION 16. ASSIGNMENT AND PARTICIPATION.......................................................................................55
SECTION 16.1. Conditions to Assignment by Banks................................................................55
SECTION 16.2. Certain Representations and Warranties; Limitations; Covenants...................................56
SECTION 16.3. Register.........................................................................................57
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SECTION 16.4. New Revolving Credit Notes.......................................................................57
SECTION 16.5. Participations...................................................................................57
SECTION 16.6. Disclosure.......................................................................................58
SECTION 16.7. Assignee or Participant Affiliated With the Borrower.............................................58
SECTION 16.8. Miscellaneous Assignment Provisions..............................................................58
SECTION 16.9. Assignment By Borrower...........................................................................59
SECTION 17. NOTICES, ETC.......................................................................................................59
SECTION 18. GOVERNING LAW......................................................................................................60
SECTION 19. HEADINGS...........................................................................................................60
SECTION 20. COUNTERPARTS.......................................................................................................60
SECTION 21. ENTIREAGREEMENT, ETC...............................................................................................60
SECTOPM 22. WAIVER OF JURY TRIAL...............................................................................................60
SECTOPM 23. CONSENTS, AMENDMENTS, WAIVERS, ETC.................................................................................61
SECTION 24. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION......................................................................61
SECTION 24.1. Sharing of Information with Section 20 Subsidiary................................................61
SECTION 24.2. Confidentiality..................................................................................62
SECTION 24.3. Prior Notification...............................................................................62
SECTION 24.4. Other............................................................................................62
SECTION 25. SEVERABILITY.......................................................................................................62
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REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT, dated as of June 26, 2000, is by and
among STAPLES, INC. (the "Borrower"), a Delaware corporation having its
principal place of business at 500 Staples Drive, Framingham, MA 01701, FLEET
NATIONAL BANK and the other lending institutions listed on SCHEDULE 1 attached
hereto (the "BANKS"), and FLEET NATIONAL BANK, as administrative agent (in such
capacity, the "AGENT") for the Banks.
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.
Section 1.1. DEFINITIONS. The following terms shall have the meanings
set forth in this Section 1 or elsewhere in the provisions of this Credit
Agreement referred to below:
ADJUSTMENT DATE. The first day of the month immediately following the
month in which a Compliance Certificate is delivered by the Borrower pursuant to
Section 5.4(c) hereof.
AFFILIATE. Any Person that would be considered to be an affiliate of
the Borrower under Rule 144(a) of the Rules and Regulations of the Securities
and Exchange Commission, as in effect on the Closing Date, if the Borrower were
issuing securities.
AGENT. As defined in the preamble hereto.
AGENT FEES. See Section 3.1 hereof.
AGENT'S HEAD OFFICE. The Agent's office located at 100 Federal Street,
Boston, Massachusetts 02110, or at such other location as the Agent may
designate from time to time.
AGENT'S SPECIAL COUNSEL. Bingham Dana LLP or such other counsel as may
be approved by the Agent.
APPLICABLE MARGIN. The Applicable Margin shall be in effect for each
period commencing on an Adjustment Date through the date immediately
preceding the next Adjustment Date (each a "RATE ADJUSTMENT PERIOD") based on
a determination of the Fixed Charge Coverage Ratio and the Senior Debt
Rating. The Fixed Charge Coverage Ratio shall be determined as at the end of
the fiscal period for which financial statements and a Compliance Certificate
have most recently been delivered to the Agent pursuant to Section 5.4 and
the Senior Debt Rating shall be determined as of the last day of the
preceding Rate Adjustment Period. The Applicable Margin shall be the
applicable rate PER ANNUM, expressed in Basis Points, corresponding to the
lower of the Levels set forth in the table below (with Level I being the
lowest level and Level VI being the highest level) corresponding to the Fixed
Charge Coverage Ratio or the Senior Debt Rating, PROVIDED THAT if the Fixed
Charge Coverage Ratio and Senior Debt
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Rating are more than one Level apart, the Applicable Margin shall be one Level
below the higher of the two applicable Levels. In the event that the Senior Debt
Ratings assigned by Moody's and S&P are not equivalent, the following criteria
shall determine which Level shall be applicable to the Senior Debt Rating: (i)
if the Senior Debt Ratings are one Level apart, the Level applicable to the
Senior Debt Rating shall be the lower of the two Levels and (ii) if the Senior
Debt Ratings are more than one Level apart, the Level applicable to the Senior
Debt Rating shall be one Level below the higher of the two Levels. For purposes
of clarity, the parties hereto acknowledge that the Applicable Margin with
respect to (i) Eurodollar Rate Loans shall be the rate per annum set forth in
column D in the table below and (ii) the Facility Fee shall be the rate per
annum set forth in column E in the table below.
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A B C D E
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LEVEL FIXED CHARGE SENIOR DEBT EURODOLLAR RATE FACILITY FEE
COVERAGE RATIO RATING LOANS
------------ ------------------------ ------------------- ------------------------ -----------------------
I (greater than 2.50:1 S&P: A- 38.0 7.0
or equal to) Moody's: A3 or
better
------------ ------------------------ ------------------- ------------------------ -----------------------
II (greater than 2.25:1 S&P: BBB+ 41.0 9.0
or equal to) Moody's: Baa1 or
better
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III (greater than 2.00:1 S&P: BBB 52.0 10.5
or equal to) Moody's: Baa2 or
better
------------ ------------------------ ------------------- ------------------------ -----------------------
IV (greater than 1.85:1 S&P: BBB- 67.0 13.0
or equal to) Moody's: Baa3 or
better
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V (greater than 1.75:1 S&P: BB+ 77.5 18.5
or equal to) Moody's: Ba1 or
better
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VI (less than) 1.75:1 lower than 77.5 22.5
S&P: BB+
Moody's: Ba1 or
unrated
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Notwithstanding the foregoing, (a) for the period commencing on the Closing Date
through the date immediately preceding the first Adjustment Date to occur after
the Closing Date, the Applicable Margin shall be that corresponding to Level II
in the table above, (b) if the Borrower fails to deliver any Compliance
Certificate pursuant to Section 5.4(c) hereof then, for the period commencing on
the date such Compliance Certificate was due through the date immediately
preceding the Adjustment Date that occurs immediately following the date on
which such Compliance Certificate is delivered, the Applicable Margin shall be
the Applicable Margin corresponding to Level VI above, and (c) for any day on
which the outstanding principal amount of Revolving Credit Loans exceeds an
amount equal to fifty percent (50%) of the Total Commitment, the Applicable
Margin with respect to Eurodollar Rate Loans set forth in column D in the table
above shall be increased by a rate per annum equal to twelve and one-half (12.5)
Basis Points.
ARRANGER. FleetBoston Robertson Stephens Inc., a Massachusetts
corporation.
ASSIGNMENT AND ACCEPTANCE. See Section 16.1 hereof.
BALANCE SHEET DATE. January 29, 2000.
BANKS. As defined in the preamble hereto, which term shall include any
other Person who becomes an assignee of any rights and obligations of a Bank
pursuant to Section 16 hereof.
BASE RATE LOANS. Any Revolving Credit Loans bearing interest calculated
by reference to the Prime Rate.
BASIS POINT. One one-hundredth of one percent (0.01%).
BORROWER. As defined in the preamble hereto.
BUSINESS DAY. Any day on which banking institutions in Boston,
Massachusetts and New York, New York, are open for the transaction of banking
business and, in the case of Eurodollar Rate Loans, also a day which is a
Eurodollar Business Day.
CAPITAL STOCK. With respect to any corporation, partnership, trust,
unincorporated association, joint venture, limited liability company, or other
legal or business entity, any and all shares, interests, participations or other
equivalent (however designated) of capital stock of such entity, any and all
limited or general partnership interests and equivalent ownership interests in
such entity, any and all warrants and options to purchase any of the foregoing,
and any securities convertible into any of the foregoing.
CAPITALIZED LEASES. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to be capitalized on the balance sheet of
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the lessee or obligor in accordance with generally accepted accounting
principles.
CERCLA. The Comprehensive Environmental Response, Compensation and
Liability Act of 1980.
CLOSING DATE. The first date on which the conditions set forth in
Section 8 hereof have been satisfied, which shall be no later than June 30,
2000.
CODE. The Internal Revenue Code of 1986.
COMMITMENT. The agreement of each Bank, subject to the terms and
conditions of this Credit Agreement, to make Revolving Credit Loans to the
Borrower.
COMMITMENT AMOUNT. With respect to each Bank, the amount of such Bank's
Commitment set forth on Schedule 1 attached hereto, as the same may be reduced
from time to time in accordance with the terms of this Credit Agreement; or if
the Total Commitment is terminated pursuant to the provisions hereof, zero.
COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set
forth on SCHEDULE 1 attached hereto as such Bank's percentage of the Total
Commitment.
COMPLIANCE CERTIFICATE. See Section 5.4(c) hereof.
CONFIDENTIAL INFORMATION. All information relating to the Borrower or
any of its Subsidiaries that is labeled by the Borrower or such Subsidiary as
confidential at the time such information is supplied by the Borrower or such
Subsidiary to a Bank, other than information which (a) is public knowledge or
generally available to the public, or (b) is obtained by any of the Banks,
whether prior to or after disclosure to such Bank by the Borrower or any of its
Subsidiaries, from a source other than the Borrower or any of its Subsidiaries,
provided that such information is not known by such Bank to have been disclosed
by any party in violation of a confidentiality agreement with the Borrower or
any of its Subsidiaries, any other obligation of nondisclosure with respect to
the Borrower or any of its Subsidiaries or any applicable statutory or
regulatory limitation imposed on the disclosure of such information.
CONSOLIDATED or CONSOLIDATED. With reference to any term defined
herein, shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with generally accepted accounting
principles.
CONSOLIDATED EBITDA. For any fiscal period of the Borrower, the
consolidated Earnings Before Interest and Taxes of the Borrower and its
Subsidiaries for such period PLUS, to the extent deducted in the calculation
thereof, and without duplication, the aggregate amount of depreciation and
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amortization of the Borrower and its Subsidiaries for such period, determined on
a consolidated basis for such Persons in accordance with Generally Accepted
Accounting Principles.
CONSOLIDATED NET INCOME (or DEFICIT). The consolidated net income (or
deficit) of the Borrower and its Subsidiaries, after deduction of all expenses,
interest, taxes, and other proper charges, determined in accordance with
generally accepted accounting principles.
CONSOLIDATED TANGIBLE NET WORTH. The excess of Consolidated Total
Assets over Consolidated Total Liabilities, and less the sum of:
(a) the total book value of all assets of the Borrower and its
Subsidiaries properly classified as intangible assets under generally accepted
accounting principles, including such items as lease acquisition costs, deferred
charges, goodwill, the purchase price of acquired assets in excess of the fair
market value thereof, trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect to the foregoing; PLUS
(b) all amounts representing any write-up in the book value of
any assets of the Borrower or its Subsidiaries resulting from a revaluation
thereof subsequent to the Balance Sheet Date, excluding adjustments to translate
foreign assets and liabilities for changes in foreign exchange rates made in
accordance with generally accepted accounting principles.
CONSOLIDATED TOTAL ASSETS. All assets of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles.
CONSOLIDATED TOTAL INTEREST EXPENSE. For any period, the aggregate
amount of interest required to be paid or accrued by the Borrower and its
Subsidiaries during such period on all Indebtedness of the Borrower and its
Subsidiaries outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of Capitalized
Leases, and including facility fees, commitment fees, usage fees, agency fees,
balance deficiency fees, and similar fees or expenses in connection with the
borrowing of money, as determined in accordance with generally accepted
accounting principles.
CONSOLIDATED TOTAL LIABILITIES. All liabilities of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles.
CONTINGENT LIABILITIES. Any guaranties, endorsements, obligations to
reimburse the issuer in respect of any letters of credit, agreements to purchase
or provide funds for the payment of obligations of others, or other liabilities
which would be classified as contingent in accordance with generally accepted
accounting principles consistently applied, excluding, however, (a) product
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warranties given in the ordinary course of business, (b) endorsements of checks
or other negotiable instruments for deposit or collection in the ordinary course
of business, and (c) reimbursement obligations in respect of documentary trade
letters of credit.
CONVERSION REQUEST. A notice given by the Borrower to the Agent of the
Borrower's election to convert or continue a Revolving Credit Loan in accordance
with Section 2.9 hereof.
CREDIT AGREEMENT. This Revolving Credit Agreement, including the
Schedules and Exhibits hereto.
DEFAULT. See Section 10.1 hereof.
DELINQUENT BANK. See Section 12.5.3 hereof.
DISTRIBUTION. The declaration or payment of any dividend on or in
respect of any shares of any class of Capital Stock of the Borrower, other than
dividends payable solely in shares of common stock of the Borrower; the
purchase, redemption, or other retirement of any shares of any class of Capital
Stock of the Borrower, directly or indirectly through a Subsidiary of the
Borrower or otherwise; the return of capital by the Borrower to its shareholders
as such; or any other distribution on or in respect of any shares of any class
of Capital Stock of the Borrower.
DOLLARS or $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank designated
as such in SCHEDULE 1 attached hereto; thereafter, such other office of such
Bank, if any, located within the United States that will be making or
maintaining Base Rate Loans.
DOMESTIC SUBSIDIARY. Any Subsidiary that is organized under the laws of
the United States of America or any of the States (or the District of Columbia)
thereof.
DRAWDOWN DATE. The date on which any Revolving Credit Loan is made or
is to be made, and the date on which any Revolving Credit Loan is converted or
continued in accordance with Section 2.9 hereof.
EARNINGS BEFORE INTEREST AND TAXES. Consolidated earnings (or deficit)
from the operations of the Borrower and its Subsidiaries, after deducting all
expenses and other proper charges other than interest expense and taxes, and
excluding all extraordinary and nonrecurring items of income or loss, as
determined in accordance with generally accepted accounting principles.
ELIGIBLE ASSIGNEE. Any of (a) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $1,000,000,000; (b) a
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savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a
net worth of at least $100,000,000, calculated in accordance with generally
accepted accounting principles; (c) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having total assets in excess of $1,000,000,000, or the central
bank of any country which is a member of the OECD, PROVIDED, in each case, that
such bank (i) is acting through a branch or agency located in the country in
which it is organized or another country which is also a member of the OECD and
(ii) has delivered to the Agent, on the date on which the Assignment and
Acceptance to which such Eligible Assignee is a party becomes effective, the
forms referred to in Section 3.3.3 hereof; and (d) if, but only if, any Event of
Default has occurred and is continuing, any other bank, insurance company,
commercial finance company or other financial institution or other Person
approved by the Agent, such approval not to be unreasonably withheld.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
ENVIRONMENTAL LAWS. Any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without limitation,
those arising under the Resource Conservation and Recovery Act ("RCRA"), CERCLA,
the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Federal
Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or
any state or local statute, regulation, ordinance, order or decree relating to
health, safety or the environment.
ENVIRONMENTAL NOTICE. Any notice to the Borrower or any of its
Subsidiaries from any third party including, without limitation: any federal,
state or local governmental authority, (a) that it has been identified by the
United States Environmental Protection Agency as a potentially responsible party
under CERCLA with respect to a site listed on the National Priorities List, 40
C.F.R. Part 300 Appendix B; (b) that any Hazardous Substances which it has
generated, transported or disposed of has been found at any site at which a
federal, state or local agency or other third party has conducted or has ordered
that the Borrower or any of its Subsidiaries conduct a remedial investigation,
removal or other response action pursuant to any Environmental Law; or (c) that
it is or shall be a named party to any claim, action, cause of action,
complaint, or legal or administrative proceeding in connection with the release
of Hazardous Substances.
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA AFFILIATE. Any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.
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ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other interbank market as may be selected by the Agent in its sole discretion
acting in good faith.
EURODOLLAR LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 attached hereto; thereafter, such other office
of such Bank, if any, that shall be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (a) the rate (rounded upwards to the
nearest 1/16 of one percent) per annum at which the Reference Bank's Eurodollar
Lending Office is offered Dollar deposits two (2) Eurodollar Business Days prior
to the beginning of such Interest Period in the interbank eurodollar market
where the eurodollar and foreign currency and exchange operations of such
Eurodollar Lending Office are customarily conducted, for delivery on the first
day of such Interest Period for the number of days comprised therein and in an
amount comparable to the amount of the Eurodollar Rate Loan to which such
Interest Period applies, divided by (b) a number equal to 1.00 MINUS the
Eurocurrency Reserve Rate.
EURODOLLAR RATE LOANS. Any Revolving Credit Loans bearing interest
calculated by reference to the Eurodollar Rate.
EVENT OF DEFAULT. See Section 10.1 hereof.
FACILITY FEE. See Section 3.2 hereof.
FEE LETTER. See Section 3.1 hereof.
FIXED CHARGE COVERAGE RATIO. See Section 7.1 hereof.
FLEET. Fleet National Bank, a national banking association, in its
individual capacity.
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GENERALLY ACCEPTED ACCOUNTING PRINCIPLES or GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES. (a) When used in Section 7 hereof, whether directly or
indirectly through reference to a capitalized term used therein, means (i)
principles that are consistent with the principles promulgated or adopted by the
Financial Accounting Standards Board and its predecessors, in effect for the
fiscal year ended on the Balance Sheet Date, and (ii) to the extent consistent
with such principles, the accounting practice of the Borrower reflected in its
financial statements for the year ended on the Balance Sheet Date, and (b) when
used in general, other than as provided above, means principles that are (i)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to time,
and (ii) consistently applied with past financial statements of the Borrower
adopting the same principles, provided that in each case referred to in this
definition of "generally accepted accounting principles" a certified public
accountant would, insofar as the use of such accounting principles is pertinent,
be in a position to deliver an unqualified opinion (other than a qualification
regarding changes in generally accepted accounting principles) as to financial
statements in which such principles have been properly applied.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate the benefits of which are guaranteed on termination in full
or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
GUARANTIES. The Guaranty by each Guarantor in favor of the Agent for
the benefit of the Banks, dated as of the date hereof, and each additional
guaranty executed by a Subsidiary acquired or formed after the date hereof.
GUARANTORS. Those Subsidiaries of the Borrower listed on SCHEDULE 2
attached hereto, as such schedule may be modified from time to time in
accordance with Section 3.13 hereof.
HAZARDOUS SUBSTANCES. Any hazardous waste, as defined by 42 U.S.C.
Section 6903(5), any hazardous substances as defined by 42 U.S.C. Section
9601(14), any pollutant or contaminant as defined by 42 U.S.C. Section 9601(33)
and any toxic substances, oil or hazardous materials or other chemicals or
substances regulated by any Environmental Laws.
INDEBTEDNESS. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should be
made by footnotes thereto, including in any event and whether or not so
classified: (a) all debt and similar monetary obligations, whether direct or
indirect; (b) all liabilities secured by any mortgage, pledge, security
interest, lien, charge or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; (c) all obligations in respect of interest rate protection
arrangements
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and exchange rate protection arrangements; and (d) all guarantees, endorsements
and other contingent obligations whether direct or indirect in respect of
indebtedness of others, including any obligation to supply funds to or in any
manner to invest in, directly or indirectly, the debtor, to purchase
indebtedness, or to assure the owner of indebtedness against loss, through an
agreement to purchase goods, supplies, or services for the purpose of enabling
the debtor to make payment of the indebtedness held by such owner or otherwise,
and the obligations to reimburse the issuer in respect of any letters of credit.
INELIGIBLE SECURITIES. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Bank Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
INTEREST PAYMENT DATE. (a) As to any Base Rate Loan, the last day of
the calendar quarter which includes the Drawdown Date thereof; and (b) as to any
Eurodollar Rate Loan in respect of which the Interest Period is (i) 3 months or
less, the last day of such Interest Period and (ii) more than 3 months, the date
that is 3 months from the first day of such Interest Period, the last day of
each 3 month period thereafter, and, in addition, the last day of such Interest
Period.
INTEREST PERIOD. With respect to each Revolving Credit Loan (a)
initially, the period commencing on the Drawdown Date of such Revolving Credit
Loan and ending on the last day of one of the periods set forth below, as
selected by the Borrower in a Loan Request (i) for any Base Rate Loan, the last
day of the calendar quarter; and (ii) for any Eurodollar Rate Loan, 1, 2, 3 or 6
months; and (b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Revolving Credit Loan and ending on
the last day of one of the periods set forth above, as selected by the Borrower
in a Conversion Request; PROVIDED that all of the foregoing provisions relating
to Interest Periods are subject to the following:
(A) if any Interest Period with respect to a Eurodollar Rate
Loan would otherwise end on a day that is not a Eurodollar Business
Day, that Interest Period shall be extended to the next succeeding
Eurodollar Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(B) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(C) if the Borrower shall fail to give notice as provided in
Section 2.9 hereof, the Borrower shall be deemed to have requested a
conversion of the affected Eurodollar Rate Loan to a Base Rate Loan and
the continuance of all Base Rate Loans as Base Rate Loans on the last
day of the then current Interest Period with respect thereto;
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(D) any Interest Period relating to any Eurodollar Rate Loan
that begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurodollar Business Day of a calendar month; and
(E) any Interest Period relating to any Revolving Credit Loan
that would otherwise extend beyond the Maturity Date shall end on the
Maturity Date.
INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (d) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (b) may be
deducted when paid; and (e) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
LOAN DOCUMENTS. This Credit Agreement, the Revolving Credit Notes, the
Guaranties, the Fee Letter and any other documents delivered pursuant to this
Credit Agreement.
LOAN REQUEST. See Section 2.2 hereof.
MAJORITY BANKS. As of any date, except as otherwise provided below, the
Banks holding at least fifty-one percent (51%) of the outstanding principal
amount of the Revolving Credit Notes on such date; and if no such principal is
outstanding, the Banks whose aggregate Commitment Amounts constitute at least
fifty-one percent (51%) of the Total Commitment.
MARGIN REGULATIONS. See Section 4.13 hereof.
MATURITY DATE. June 25, 2001.
MEASUREMENT PERIOD. See Section 7.1 hereof.
MOODY'S. Moody's Investors Service, Inc.
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MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.
OBLIGATIONS. All indebtedness, obligations and liabilities of any of
the Borrower and its Subsidiaries to any of the Banks and the Agent,
individually or collectively, existing on the date of this Credit Agreement or
arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Credit Agreement or any of the other Loan Documents or in
respect of any of the Revolving Credit Loans made, or any of the Revolving
Credit Notes or other instruments at any time evidencing any thereof.
OPTION LOANS. See Section 6.3 hereof.
OUTSTANDING or OUTSTANDING. With respect to the Revolving Credit Loans,
the aggregate unpaid principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted under Section 6.2 hereof.
PERSON. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
PRIME RATE. The higher of (a) the annual rate of interest announced
from time to time by Fleet at its office in Boston, Massachusetts, as its "prime
rate" and (b) one-half of one percent (1/2%) per annum above the Federal Funds
Effective Rate. For the purposes of this definition, "Federal Funds Effective
Rate" shall mean for any day, the rate per annum equal to the weighted average
of the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three funds brokers of recognized
standing selected by the Agent.
RATE ADJUSTMENT PERIOD. See definition of Applicable Margin.
REAL ESTATE. All real property at any time owned or leased (as lessee
or sublessee) by the Borrower or any of its Subsidiaries.
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RECORD. The grid attached to a Revolving Credit Note, or the
continuation of such grid, or any other similar record, including computer
records, maintained by any Bank with respect to any Revolving Credit Loan
referred to in such Revolving Credit Note.
REFERENCE BANK. Fleet.
RENTAL EXPENSE. All obligations of the Borrower or any of its
Subsidiaries under any rental agreements or leases of real property, other than
(a) obligations that can be terminated by the giving of notice without liability
to the Borrower or such Subsidiary in excess of the liability for rent due as of
the date on which such notice is given and under which no penalty or premium is
paid as a result of any such termination, and (b) obligations in respect of
Capitalized Leases.
REPLACEMENT BANK. See Section 3.12 hereof.
REVOLVER PERIOD. The period beginning on the Closing Date to and
including the day immediately preceding the Maturity Date.
REVOLVING CREDIT LOANS. One or more revolving credit loans funded by
the Banks in accordance with their respective Commitment Percentages.
REVOLVING CREDIT NOTE. See Section 2.4 hereof.
S&P. Standard & Poor's Ratings Group, a division of McGraw-Hill, Inc.
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
SENIOR DEBT RATING. The rating issued by S&P or Moody's with respect to
unsecured Indebtedness of the Borrower not maturing within twelve months, issued
without third-party credit enhancement, and not subordinated by its term in
right of payment to other Indebtedness of the Borrower. In the event that no
such ratings are available on such unsecured Indebtedness of the Borrower, the
Senior Debt Rating shall be the rating implied, in the reasonable discretion of
the Agent, to such unsecured Indebtedness by reference to the Subordinated
Debentures or such other Indebtedness of the Borrower as shall be so rated.
STOCKHOLDERS' EQUITY. As at any date of determination, the sum of (a)
the capital accounts including common stock and preferred stock, but excluding
treasury stock of the Borrower PLUS (b) the earned surplus and capital surplus
of the Borrower (excluding adjustments to translate foreign assets and
liabilities for changes in foreign exchange rates made in accordance with
Financial Accounting Standards Board Statement No. 52), as determined in
accordance with generally accepted accounting principles.
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SUBORDINATED DEBT. Unsecured Indebtedness of the Borrower or any of its
Subsidiaries that is expressly subordinated and made junior to the payment and
performance of the Obligations, and evidenced as such by a written instrument
containing subordination provisions in form and substance approved by the
Majority Banks in writing.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock and the accounts of which are
consolidated with the Borrower in accordance with Generally Accepted Accounting
Principles.
SUBSTITUTED BANK. See Section 3.12 hereof.
TOTAL COMMITMENT. The sum of the Commitment Amounts of the Banks, as in
effect from time to time. The Total Commitment as of the Closing Date is
$200,000,000.
TOTAL FUNDED INDEBTEDNESS. As at any date of determination, on a
consolidated basis, the aggregate (without duplication) of (a) all outstanding
Indebtedness of the Borrower and its Subsidiaries relating to the borrowing of
money or the obtaining of credit (including, without limitation, standby letters
of credit), plus (b) all obligations of the Borrower and its Subsidiaries as
lessees under Capitalized Leases.
TYPE. As to any Revolving Credit Loan, its nature as a Base Rate Loan
or a Eurodollar Rate Loan.
VOTING STOCK. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
SECTION 1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes
the singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted
successors and permitted assigns.
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(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles applied on
a consistent basis by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have the
meanings assigned to them therein.
(h) Reference to a particular "Section Symbol" refers to that
section of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.
SECTION 2. THE REVOLVING CREDIT FACILITY.
SECTION 2.1. COMMITMENT TO LEND REVOLVING CREDIT LOANS. Subject to the
terms and conditions set forth in this Credit Agreement, each of the Banks
severally agrees from time to time during the Revolver Period to make Revolving
Credit Loans to the Borrower in such amounts as are requested by the Borrower,
PROVIDED, that the sum of the aggregate principal amount of Revolving Credit
Loans made by each Bank (after giving effect to all amounts requested) shall not
at any time exceed such Bank's Commitment Amount, and PROVIDED, FURTHER, that
(i) at no time shall the outstanding aggregate principal amount of all Revolving
Credit Loans made by all Banks exceed the Total Commitment, and (ii) at all
times the outstanding aggregate principal amount of all Revolving Credit Loans
made by each Bank shall equal such Bank's Commitment Percentage of the
outstanding aggregate principal amount of all Revolving Credit Loans made
pursuant to the terms of this Credit Agreement. Subject to the terms and
conditions set forth in this Credit Agreement, the Borrower may borrow, repay
and reborrow Revolving Credit Loans from time to time during the Revolver Period
upon notice by the Borrower to the Agent given in accordance with Section 2.2
hereof. Each request for a Revolving Credit Loan hereunder shall constitute a
representation and warranty by the Borrower that the conditions set forth in
Sections 8 and 9 hereof, in the case of the initial Revolving Credit Loans to be
made on the Closing Date, and Section 9 hereof, in the case of all other
Revolving Credit Loans, shall have been satisfied on the date of such request.
SECTION 2.2. REQUESTS FOR REVOLVING CREDIT LOANS. The Borrower shall
give to the Agent written notice in the form of EXHIBIT A attached hereto (or
telephonic notice confirmed in a writing in the form of EXHIBIT A attached
hereto) of each Revolving Credit Loan requested hereunder (a "LOAN REQUEST") not
later than (a)
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12:00 noon (Boston time) on the proposed Drawdown Date of any Base Rate Loan and
(b) 12:00 noon (Boston time) three (3) Eurodollar Business Days prior to the
proposed Drawdown Date of any Eurodollar Rate Loan. Each such notice shall
specify (i) the principal amount of the Revolving Credit Loan requested, (ii)
the proposed Drawdown Date of such Revolving Credit Loan, (iii) the Interest
Period for such Revolving Credit Loan and (iv) the Type of such Revolving Credit
Loan. Promptly upon receipt of any such notice, the Agent shall notify each of
the Banks thereof. Each Loan Request shall be irrevocable and binding on the
Borrower and shall obligate the Borrower to accept the Revolving Credit Loan
requested from the Banks on the proposed Drawdown Date. Each Loan Request shall
be (A) in a minimum aggregate amount of $1,000,000 or an integral multiple
thereof with respect to Base Rate Loans and (B) in a minimum aggregate amount of
$2,000,000 or an integral multiple of $l,000,000 with respect to Eurodollar Rate
Loans.
SECTION 2.3. FUNDS FOR REVOLVING CREDIT LOANS.
SECTION 2.3.1. FUNDING PROCEDURES. Not later than 1:30 p.m. (Boston
time) on the proposed Drawdown Date of any Revolving Credit Loans, each of the
relevant Banks will make available to the Agent, at the Agent's Head Office, in
immediately available funds, the amount of such Bank's Commitment Percentage of
the amount of the requested Revolving Credit Loans. Upon receipt from each Bank
of such amount, and upon receipt of the documents required by Sections 8 and 9
hereof and the satisfaction of the other conditions set forth therein, to the
extent applicable, the Agent will make available to the Borrower the aggregate
amount of such Revolving Credit Loans made available to the Agent by the
relevant Banks. The failure or refusal of any Bank to make available to the
Agent its Commitment Percentage of the requested Revolving Credit Loans on any
Drawdown Date shall not excuse any other Bank from making available to the Agent
the amount of such other Bank's Commitment Percentage of any requested Revolving
Credit Loans.
SECTION 2.3.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has made
available to the Agent on such Drawdown Date the amount of such Bank's
Commitment Percentage of the Revolving Credit Loans to be made on such Drawdown
Date, and the Agent may (but it shall not be required to), in reliance upon such
assumption, make available to the Borrower a corresponding amount. If any Bank
makes available to the Agent such amount on a date after such Drawdown Date,
such Bank shall pay to the Agent on demand an amount equal to the product of (a)
the average computed for the period referred to in clause (c) below, of the
weighted average interest rate paid by the Agent for federal funds acquired by
the Agent during each day included in such period, TIMES (b) the amount of such
Bank's Commitment Percentage of such Revolving Credit Loans, TIMES (c) a
fraction, the numerator of which is the number of days that elapse from and
including such Drawdown Date to the date on which the amount of such Bank's
Revolving Credit Loans shall become immediately available to the Agent, and the
denominator of which is 365. A statement of the Agent submitted to such Bank
with respect to any amounts
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owing under this Section 2.3.2 shall be PRIMA FACIE evidence of the amount due
and owing to the Agent by such Bank. If the amount of such Bank's Revolving
Credit Loans is not made available to the Agent by such Bank within three (3)
Business Days following such Drawdown Date, the Agent shall be entitled to
recover such amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Revolving Credit Loans made on such Drawdown
Date and the Borrower may take the actions permitted under Section 3.12 hereof
to replace such Bank. Any payment by the Borrower to the Agent of any Revolving
Credit Loans pursuant to this Section 2.3.2 shall be deemed to be a payment of
the Loans that were to be made by the Bank that failed to make such Revolving
Credit Loans.
SECTION 2.4. THE REVOLVING CREDIT NOTES. The Revolving Credit Loans
shall be evidenced by separate promissory notes of the Borrower in substantially
the form of EXHIBIT B attached hereto (each a "REVOLVING CREDIT NOTE"), dated as
of the Closing Date and completed with appropriate insertions. A Revolving
Credit Note shall be payable to the order of each Bank in a principal amount
equal to such Bank's Commitment Amount or, if less, the outstanding amount of
all Revolving Credit Loans made by such Bank, PLUS interest accrued thereon, as
set forth below. The Borrower irrevocably authorizes each Bank to make, at or
about the time of the Drawdown Date of any Revolving Credit Loan or at the time
of receipt of any payment of principal on such Bank's Revolving Credit Note, an
appropriate notation on the Record attached to such Bank's Revolving Credit Note
reflecting the making of such Revolving Credit Loan or (as the case may be) the
receipt of such payment. The outstanding amount of the Revolving Credit Loans
set forth on such Bank's Record shall be PRIMA FACIE evidence of the principal
amount thereof owing and unpaid to such Bank, but the failure to record, or any
error in so recording, any such amount on such Bank's Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Revolving Credit Note to make payments of principal of or interest on any
Revolving Credit Note when due.
SECTION 2.5. REDUCTION OF TOTAL COMMITMENT. The Borrower shall have the
right at any time and from time to time prior to the Maturity Date upon three
(3) Business Days' prior written notice to the Agent to reduce by $5,000,000 or
an integral multiple thereof or terminate entirely the Total Commitment,
whereupon the Commitment Amount of each Bank shall be reduced PRO RATA in
accordance with its Commitment Percentage by the amount specified in such notice
or, as the case may be, terminated. Promptly after receiving any notice of the
Borrower delivered pursuant to this Section 2.5, the Agent will notify the Banks
of the substance thereof. Upon the effective date of any such reduction or
termination, the Borrower shall pay to the Agent for the respective accounts of
the Banks the full amount of the Facility Fee then accrued on the amount of the
reduction. No reduction or termination of the Total Commitment may be
reinstated.
SECTION 2.6. MANDATORY REPAYMENTS OF REVOLVING CREDIT LOANS. If at any
time the outstanding aggregate principal amount of the Revolving Credit Loans
exceeds the Total Commitment, then the Borrower shall immediately pay the
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amount of such excess to the Agent for application to the Revolving Credit Loans
for the respective accounts of the Banks. Each prepayment of Revolving Credit
Loans shall be allocated among the Banks, in proportion, as nearly as
practicable to the respective unpaid principal amount of each Bank's Revolving
Credit Note, with adjustments to the extent practicable to equalize any prior
payments or repayments not exactly in proportion.
SECTION 2.7. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The
Borrower shall have the right, at its election, to repay the outstanding amount
of the Revolving Credit Loans, as a whole or in part, at any time without
penalty or premium, PROVIDED that any full or partial repayment of the
outstanding amount of any Eurodollar Rate Loans pursuant to this Section 2.7 may
be made only on the last day of the Interest Period relating thereto unless the
Borrower pays each Bank, in accordance with Section 3.10, the costs and expenses
incurred by such Bank as a result of the repayment of such Eurodollar Rate Loan
on a day other than the last day of the Interest Period relating thereto. The
Borrower shall give the Agent, prior written notice no later than 10:00 a. m.,
Boston time, on the date of any proposed repayment pursuant to this Section 2.7
of Base Rate Loans, and three (3) Eurodollar Business Days' notice of any
proposed repayment pursuant to this Section 2.7 of Eurodollar Rate Loans, in
each case specifying the proposed date of repayment of such Revolving Credit
Loans and, the principal amount to be repaid. Each such partial repayment of the
Revolving Credit Loans shall be in an integral multiple of $5,000,000, shall be
accompanied by the payment of accrued interest on the principal repaid to the
date of repayment and shall be applied, in the absence of instruction by the
Borrower, first to the principal of Base Rate Loans and then to the principal of
Eurodollar Rate Loans. Each partial repayment shall be allocated among the
Banks, in proportion, as nearly as practicable, to the respective unpaid
principal amount of each Bank's applicable Revolving Credit Note being repaid,
with adjustments to the extent practicable to equalize any prior repayments not
exactly in proportion.
SECTION 2.8. INTEREST ON REVOLVING CREDIT LOANS. (a) During the
Revolver Period, except as otherwise provided in Section 3.11 hereof,
(i) each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate per annum equal to the Base
Rate, PROVIDED THAT for any day on which the outstanding principal amount of
Revolving Credit Loans exceeds an amount equal to fifty percent (50%) of the
Total Commitment, each Base Rate Loan shall bear interest at the rate per annum
equal to the Base Rate PLUS one hundred twenty-five thousandths of one percent
(0.125%); and
(ii) each Eurodollar Rate Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at the rate per annum equal to the
Eurodollar Rate determined for such Interest Period PLUS the Applicable Margin;
and
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(b) The Borrower promises to pay interest on each Revolving Credit Loan
in arrears on each Interest Payment Date applicable with respect thereto.
SECTION 2.9. CONVERSION OPTIONS.
SECTION 2.9.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING
CREDIT LOAN. The Borrower may elect from time to time to convert any outstanding
Revolving Credit Loan to a Revolving Credit Loan of another Type, provided that
(a) with respect to any such conversion of a Eurodollar Rate Loan to a Base Rate
Loan, the Borrower shall give the Agent at least one (1) Business Day's prior
written notice of such election; (b) with respect to any such conversion of a
Base Rate Loan to a Eurodollar Rate Loan, the Borrower shall give the Agent at
least three (3) Eurodollar Business Days' prior written notice of such election;
(c) with respect to any such conversion of a Eurodollar Rate Loan into a Base
Rate Loan, such conversion shall only be made on the last day of the Interest
Period with respect thereto; and (d) no Base Rate Loan may be converted into a
Eurodollar Rate Loan when any Default or Event of Default has occurred and is
continuing. On the date on which such conversion is being made each Bank shall
take such action as is necessary to transfer its Commitment Percentage of such
Revolving Credit Loans to its Domestic Lending Office or its Eurodollar Lending
Office, as the case may be. All or any part of outstanding Revolving Credit
Loans of any Type may be converted into a Revolving Credit Loan of another Type
as provided herein, PROVIDED that any partial conversion shall be in an
aggregate principal amount of $2,000,000 or a whole multiple of $1,000,000 in
excess thereof. Each Conversion Request relating to the conversion of a
Revolving Credit Loan to a Eurodollar Rate Loan shall be irrevocable by the
Borrower.
SECTION 2.9.2. CONTINUATION OF TYPE OF REVOLVING CREDIT
LOAN. Any Revolving Credit Loan of any Type may be continued as a Revolving
Credit Loan of the same Type upon the expiration of an Interest Period with
respect thereto by compliance by the Borrower with the notice provisions
contained in Section 2.9.1 hereof; PROVIDED that no Eurodollar Rate Loan may be
continued as such when any Default or Event of Default has occurred and is
continuing, but shall be automatically converted to a Base Rate Loan on the last
day of the first Interest Period relating thereto ending during the continuance
of any Default or Event of Default of which officers of the Agent active upon
the Borrower's account have actual knowledge. The Agent shall notify the Banks
and the Borrower promptly when any such automatic conversion contemplated by
this Section 2.9.2 is scheduled to occur.
SECTION 2.9.3. EURODOLLAR RATE LOANS. Any conversion to or
from Eurodollar Rate Loans shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of all Eurodollar Rate Loans having the same Interest Period shall not be less
than $2,000,000 or a whole multiple of $1,000,000 in excess thereof.
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SECTION 3. CERTAIN GENERAL PROVISIONS; FEES.
SECTION 3.1. AGENT FEES. The Borrower shall pay the fees (the "AGEnT
FEes") to the Agent and the Arranger in the amounts and at the times set forth
in that certain letter agreement, dated as of May 8, 2000 (as such agreement may
be amended and in effect from time to time, the "FEE LETTER"), by and among the
Borrower, the Agent and the Arranger.
SECTION 3.2. FACILITY FEE. During the Revolver Period, the Borrower
agrees to pay to the Agent for the accounts of the Banks in accordance with
their respective Commitment Percentages (except to the extent otherwise provided
below) a facility fee (the "FACILITY FEE"), which shall be calculated for each
day at a per annum rate as set forth in the definition of Applicable Margin with
respect to the Facility Fee in effect at such time on the Total Commitment. The
Facility Fee shall be payable quarterly in arrears on the last day of each
calendar quarter for the calendar quarter then ended commencing on the first
such date following the Closing Date, with a final payment on the Maturity Date
or any earlier date on which the Total Commitment shall terminate.
SECTION 3.3. FUNDS FOR PAYMENTS.
SECTION 3.3.1. PAYMENTS TO AGENT. All payments of
principal, interest, Facility Fees and any other amounts due hereunder or under
any of the other Loan Documents shall be made to the Agent, for the respective
accounts of the Banks and the Agent, at the Agent's Head Office or at such other
location in the Boston, Massachusetts, area that the Agent may from time to time
designate, in each case in immediately available funds.
SECTION 3.3.2. NO OFFSET, ETC. All payments by the
Borrower hereunder and under any of the other Loan Documents shall be made
without setoff or counterclaim and free and clear of and without deduction
for any taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, compulsory loans, restrictions or conditions of any nature now
or hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the Borrower
is compelled by law to make such deduction or withholding. If any such
obligation is imposed upon the Borrower with respect to any amount payable by
it hereunder or under any of the other Loan Documents, other than (a) with
respect to taxes based upon the Agent's or any Bank's net income, or (b) with
respect to amounts owing to a Bank that (i) is not incorporated under the
laws of the United States of America or a state thereof and (ii) has not
delivered to the Agent the forms referred to in Section 3.3.3 hereof, the
Borrower will pay to the Agent, for the account of the Banks or (as the case
may be) the Agent, on the date on which such amount is due and payable
hereunder or under such other Loan Document, such additional amount in
Dollars as shall be necessary to enable the Banks or the Agent to receive the
same net amount which the Banks or the Agent would have received on such due
date had no such obligation been imposed upon the Borrower. The Borrower will
deliver promptly to the Agent certificates or other valid vouchers for all
taxes or other charges deducted from or paid with respect to payments made by
the Borrower hereunder or under such other Loan Document.
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SECTION 3.3.3. WITHHOLDING. Each Bank that is a party to
this Credit Agreement and that is not incorporated under the laws of the United
States of America or a state thereof agrees that it will deliver to the Agent,
within seven (7) Business Days of the Closing Date, or, in the case of a Bank
which becomes a Bank pursuant to an Assignment and Acceptance, on the date which
such Assignment and Acceptance becomes effective, a copy of United States
Internal Revenue Service form 1001 or 4224 (or other applicable form prescribed
by the United States Internal Revenue Service), in each case certifying that
such Bank is entitled to receive payments under this Credit Agreement and the
Revolving Credit Notes without deduction or withholding of any United States
federal income taxes.
SECTION 3.4. COMPUTATIONS. All computations of interest on Base Rate
Loans shall be based on a 365-day or 366-day year, as applicable, and all
computations of interest on Eurodollar Rate Loans and of Facility Fees and other
fees shall be based on a 360-day year, and, in each case, paid for the actual
number of days elapsed. Except as otherwise provided in the definition of the
term "Interest Period" with respect to Eurodollar Rate Loans, whenever a payment
hereunder or under any of the other Loan Documents becomes due on a day that is
not a Business Day, the due date for such payment shall be extended to the next
succeeding Business Day, and interest shall accrue during such extension.
SECTION 3.5. INABILITY TO DETERMINE EURODOLLAR RATE. In the event,
prior to the commencement of any Interest Period relating to any Eurodollar Rate
Loan, the Agent shall determine or be notified by the Majority Banks that
adequate and reasonable methods do not exist for ascertaining the Eurodollar
Rate that would otherwise determine the rate of interest to be applicable to any
Eurodollar Rate Loan during any Interest Period, the Agent shall forthwith give
notice of such determination (which shall be conclusive and binding on the
Borrower and the Banks) to the Borrower and the Banks. In such event (a) any
Loan Request or Conversion Request with respect to Eurodollar Rate Loans shall
be automatically withdrawn and shall be deemed a request for Base Rate Loans,
(b) each Eurodollar Rate Loan will automatically, on the last day of the then
current Interest Period relating thereto, become a Base Rate Loan, and (c) the
obligations of the Banks to make Eurodollar Rate Loans shall be suspended until
the Agent or the Majority Banks, as applicable, determine that the circumstances
giving rise to such suspension no longer exist, whereupon the Agent or, as the
case may be, the Agent upon the instruction of the Majority Banks, shall so
notify the Borrower and the Banks.
SECTION 3.6. ILLEGALITY. Notwithstanding any other provisions herein,
if any present or future law, regulation, treaty or directive or in the
interpretation or application thereof shall make it unlawful for any Bank to
make or maintain Eurodollar Rate Loans, such Bank shall forthwith give notice of
such circumstances to the Borrower and the other Banks and thereupon the
commitment of such Bank to make Eurodollar Rate Loans or convert Revolving
Credit Loans of another Type to Eurodollar Rate Loans shall forthwith be
suspended and such Bank's Revolving Credit Loans then outstanding as
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Eurodollar Rate Loans, if any, shall be converted automatically to Base Rate
Loans on the last day of each Interest Period applicable to such Eurodollar Rate
Loans or within such earlier period as may be required by law. The Borrower
hereby agrees promptly to pay the Agent for the account of such Bank, upon
demand by such Bank, any additional amounts necessary to compensate such Bank
for any costs incurred by such Bank in making any conversion in accordance with
this Section 3.6, including any interest or fees payable by such Bank to lenders
of funds obtained by it in order to make or maintain its Eurodollar Loans
hereunder.
SECTION 3.7. ADDITIONAL COSTS, ETC. If any change after the Closing
Date to any present applicable law or if any future applicable law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court or by any governmental or
other regulatory body or official charged with the administration or the
interpretation thereof and requests, directives, instructions and notices at any
time or from time to time hereafter made upon or otherwise issued to any Bank or
the Agent by any central bank or other fiscal, monetary or other authority
(whether or not having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect to this
Credit Agreement, the other Loan Documents, such Bank's Commitment or the
Revolving Credit Loans (other than taxes based upon or measured by the income or
profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for
changes in taxes on income or profits) of payments to any Bank of the principal
of or the interest on any Revolving Credit Loans or any other amounts payable to
any Bank or the Agent under this Credit Agreement or any of the other Loan
Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or letters of credit issued by,
or commitments of an office of any Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan Documents,
the Revolving Credit Loans, such Bank's Commitment, or any class of loans or
commitments of which any of the Revolving Credit Loans or such Bank's Commitment
forms a part,
and the result of any of the foregoing is:
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(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Revolving Credit Loans or
such Bank's Commitment, or
(ii) to reduce the amount of principal, interest, or other
amount payable to such Bank or the Agent hereunder on account of such Bank's
Commitment, or any of the Revolving Credit Loans, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or other sum payable hereunder, the amount of
which payment or foregone interest or other sum is calculated by reference to
the gross amount of any sum receivable or deemed received by such Bank or the
Agent from the Borrower hereunder,
then, in each such case and to the extent that the amount such additional cost,
reduction, payment, foregone interest or other sum is not reflected in the Base
Rate or the Eurodollar Rate, the Borrower will, upon demand made by such Bank or
(as the case may be) the Agent at any time and from time to time and as often as
the occasion therefor may arise, pay to such Bank or the Agent such additional
amounts as will be sufficient to compensate such Bank or the Agent for such
additional cost, reduction, payment or foregone interest or other sum (without
duplication for recovery of such amounts under any other provision hereof),
PROVIDED that the Borrower shall not be liable to any Bank or the Agent for
costs incurred more than sixty (60) days prior to receipt by the Borrower of
such demand for payment from such Bank or (as the case may be) the Agent unless
such costs were incurred prior to such 60-day period solely as a result of such
present or future applicable law being retroactive to a date which occurred
prior to such 60-day period.
SECTION 3.8. CAPITAL ADEQUACY. If after the Closing Date any Bank or
the Agent determines that the adoption of or change in any law, governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) regarding capital requirements for banks or bank holding companies
or any change in the interpretation or application thereof by a court or
governmental authority with appropriate jurisdiction has the effect of reducing
the return on such Bank's or the Agent's commitment with respect to any
Revolving Credit Loans to a level below that which such Bank or the Agent could
have achieved but for such adoption, change or compliance (taking into
consideration such Bank's or the Agent's then existing policies with respect to
capital adequacy and assuming full utilization of such entity's capital) by any
amount deemed by such Bank or (as the case may be) the Agent to be material,
then such Bank or the Agent may notify the Borrower of such fact. To the extent
that the amount of such reduction in the return on capital is not reflected in
the Base Rate or the Eurodollar Rate then the Borrower agrees to pay such Bank
or (as the case may be) the Agent for the amount of such reduction in the return
on capital as and when such reduction is determined upon presentation by such
Bank or (as the case may be) the Agent of a certificate in accordance with
Section 3.9 hereof, PROVIDED that the Borrower shall not be liable to any Bank
or the Agent for costs incurred more than sixty (60) days prior to receipt by
the Borrower of the notice
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referred to in the immediately preceding sentence from such Bank or (as the case
may be) the Agent. Each Bank shall allocate such cost increases among its
customers in good faith and on an equitable basis.
SECTION 3.9. CERTIFICATE. A certificate setting forth any additional
amounts payable pursuant to Sections 3.7 or 3.8 hereof and a brief explanation
of such amounts which are due, submitted by any Bank or the Agent to the
Borrower, shall be conclusive, absent manifest error, that such amounts are due
and owing. If the Borrower is required to pay any additional amounts pursuant to
Sections 3.7 or 3.8 hereof with respect to any Bank, the Borrower may, following
payment in full of the amount or amounts due set forth in such certificate, take
the actions permitted by Section 3.12 hereof to replace such Bank.
SECTION 3.10. INDEMNITY. The Borrower agrees to indemnify each Bank and
to hold each Bank harmless from and against all redeployment costs and expenses
that such Bank may sustain or incur as a consequence of (a) default by the
Borrower in payment of the principal amount of or any interest on any Eurodollar
Rate Loan as and when due and payable, including any such cost or expense
arising from interest or fees payable by such Bank to lenders of funds obtained
by it in order to maintain its Eurodollar Rate Loans, (b) default by the
Borrower in making a borrowing or conversion after the Borrower has given (or is
deemed to have given) a Loan Request or a Conversion Request relating thereto in
accordance with Sections 2.2 or 2.9 hereof, or (c) the making of any payment of
a Eurodollar Rate Loan or the making of any conversion of any such Revolving
Credit Loan to a Base Rate Loan on a day that is not the last day of the
applicable Interest Period with respect thereto, including interest or fees
payable by such Bank to lenders of funds obtained by it in order to maintain any
such Revolving Credit Loans.
SECTION 3.11. INTEREST ON OVERDUE AMOUNTS. Overdue principal and (to
the extent permitted by applicable law) interest on the Revolving Credit Loans
and all other overdue amounts payable hereunder or under any of the other Loan
Documents, if not repaid on or before the fifth calendar day following the day
such payment was due, shall bear interest from the due date thereof, compounded
monthly and payable on demand at any time from and after the fifth calendar day
following the day such payment was due, at a rate per annum equal to two percent
(2%) above the Base Rate until such amount shall be paid in full (after as well
as before judgment).
SECTION 3.12. REPLACEMENT OF INDIVIDUAL BANKS. Upon the happening of
any of the events set forth in Sections 2.3.2, 3.6, 3.7, or 3.8, the Borrower
may (PROVIDED that at the time no Default or Event of Default exists or would
result after giving effect to the Borrower's action) prepay in full all
Revolving Credit Loans and other obligations owing by the Borrower to each
affected Bank (a "SUBSTITUTED BANK"), together with all amounts payable by the
Borrower under Section 3.10 hereof with respect to such prepayment, and
terminate the Commitment(s) of such Bank(s) subject to the following conditions:
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(a) the Borrower shall have delivered to the Agent not less
than ten (10) Business Days prior to the exercise of its rights under this
Section 3.12 a written commitment in form and substance satisfactory to the
Agent and each of the Banks from a banking institution (the "REPLACEMENT BANK")
reasonably acceptable to the Agent and each of the remaining Banks (other than
the Substituted Bank) in which such Replacement Bank agrees to become a "Bank"
under this Credit Agreement, having a Commitment Amount in the amount of the
Substituted Bank's Commitment Amount;
(b) the Borrower shall have given appropriate notice of any
prepayment under this Section 3.12 as required by Section 2.7 and subject to all
other provisions of this Credit Agreement; and
(c) simultaneously with any prepayment of all Revolving Credit
Loans and other obligations owing by the Borrower to a Substituted Bank under
this Section 3.12, the Substituted Bank shall have assigned pursuant to Section
16 hereof of this Credit Agreement the Commitment of such Substituted Bank to
the Replacement Bank and such Replacement Bank shall have become a Bank under
this Credit Agreement, having a Commitment Amount in the amount of such
Substituted Bank's Commitment Amount and such Replacement Bank shall have
simultaneously funded all such Revolving Credit Loans prepaid hereunder.
SECTION 3.13. GUARANTIES. The payment and performance of the
Obligations shall be guaranteed by each Guarantor pursuant to the Guaranties,
each of which shall be in the form of EXHIBIT E hereto. The Agent and the Banks
hereby agree that they shall, upon the written request of the Borrower and at
the cost and expense of the Borrower, release any Guarantor from its obligations
to the Agent and the Banks under the Guaranty to which such Guarantor is a party
if, and only if, (a) such Guarantor is no longer a Subsidiary of the Borrower,
(b) no Default or Event of Default shall have occurred and be continuing on the
date of such release, and (c) the Borrower shall have delivered to the Agent and
the Banks on the date of such release a certificate signed by an authorized
officer of the Borrower and evidence satisfactory to the Agent and the Banks
showing compliance with the provisions of clauses (a) and (b) hereof. The
Borrower shall deliver to the Banks an updated SCHEDULE 2 upon the release or
addition of any Guarantor of its obligations as provided in this Section 3.13.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Banks and the Agent as follows:
SECTION 4.1. CORPORATE AUTHORITY.
SECTION 4.1.1. INCORPORATION; GOOD STANDING. The Borrower
and each Guarantor (a) is a corporation or, as the case may be, a Massachusetts
Business Trust duly organized, validly existing and in good standing under the
laws of its state of incorporation or organization, (b) has all requisite
corporate or, as the case may be, trust power to own its property and conduct
its
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business as now conducted and as presently contemplated, and (c) is in good
standing as a foreign corporation and is duly authorized to do business in each
jurisdiction where such qualification is necessary except where a failure to be
so qualified would not have a materially adverse effect on the business, assets
or financial condition of the Borrower.
SECTION 4.1.2. AUTHORIZATION. The execution, delivery and
performance of this Credit Agreement and the other Loan Documents by the
Borrower and each Guarantor which is or is to become a party thereto, and the
transactions contemplated hereby and thereby (a) are within the corporate or, as
the case may be, trust authority of such Person, (b) have been duly authorized
by all necessary corporate or, as the case may be, trust proceedings, (c) do not
conflict with or result in any breach or contravention of any provision of law,
statute, rule or regulation to which such Person is subject which would have a
material adverse effect either individually or in the aggregate on the Borrower
and its Subsidiaries taken as a whole or on the ability of such Person to
fulfill its obligations under this Credit Agreement and the other Loan Documents
to which it is a party, (d) do not conflict with or result in any breach or
contravention of any judgment, order, writ, injunction, license or permit
applicable to the Borrower or any Guarantor and (e) do not conflict with any
provision of the corporate charter or bylaws or, as the case may be, the
Agreement and Declaration of Trust of, or any agreement or other instrument
binding upon, the Borrower or any Guarantor.
SECTION 4.1.3. ENFORCEABILITY. The execution and delivery
of this Credit Agreement and the other Loan Documents to which the Borrower or
any Guarantor is or is to become a party will result in valid and legally
binding obligations of such Person enforceable against it in accordance with the
respective terms and provisions hereof and thereof, except as enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting generally the enforcement of creditors' rights and
except to the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
SECTION 4.2. GOVERNMENTAL APPROVALS. The execution, delivery and
performance by the Borrower and the Guarantors of this Credit Agreement and the
other Loan Documents to which the Borrower or any Guarantor is or is to become a
party and the transactions contemplated hereby and thereby do not require the
approval or consent of, or filing with, any governmental agency or authority
other than those already obtained.
SECTION 4.3. TITLE TO PROPERTIES; LEASES. Except as indicated on
SCHEDULE 4.3 hereto, the Borrower and its Subsidiaries own all of the assets
reflected in the consolidated balance sheet of the Borrower as at the Balance
Sheet Date or acquired since that date (except property and assets sold or
otherwise disposed of in the ordinary course of business since that date),
subject to no rights of others, including any mortgages, leases, conditional
sales agreements, title retention agreements, liens or other encumbrances except
Permitted Liens.
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SECTION 4.4. FINANCIAL STATEMENTS. (a) There has been furnished to each
of the Banks a consolidated balance sheet of the Borrower and its Subsidiaries
as at the Balance Sheet Date, and consolidated statements of income and cash
flow of the Borrower and its Subsidiaries for the fiscal year then ended,
certified by Ernst & Young. Such balance sheet and statements of income and cash
flows have been prepared in accordance with generally accepted accounting
principles and fairly present the financial condition of the Borrower and its
Subsidiaries as at the close of business on the date thereof and the results of
operations for the fiscal year then ended. There are no contingent liabilities
of the Borrower or any of its Subsidiaries as of such date involving material
amounts, known to the officers of the Borrower, which were not disclosed in such
balance sheet and the notes related thereto.
(b) There has been furnished to each of the Banks an audited
consolidated balance sheet of the Borrower and its Subsidiaries as at the
Balance Sheet Date, and audited consolidated statements of income and cash flow
of the Borrower and its Subsidiaries for the fiscal year then ended. Such
balance sheet and statements of income and cash flows have been prepared in
accordance with generally accepted accounting principles and fairly present the
financial condition of the Borrower and its Subsidiaries as at the close of
business on the date thereof and the results of operations for the fiscal
quarter then ended (subject to year-end adjustments). There are no contingent
liabilities of the Borrower or any of its Subsidiaries as of such date involving
material amounts, known to the officers of the Borrower, which were not
disclosed in such balance sheet and the notes related thereto.
SECTION 4.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date
there has occurred no change in the operations, business, properties, assets or
financial condition of the Borrower and its Subsidiaries as shown on or
reflected in the consolidated balance sheet of the Borrower and its Subsidiaries
as at the Balance Sheet Date, or the consolidated statements of income and cash
flows for the fiscal year then ended, other than changes in the ordinary course
of business that have not had any materially adverse effect either individually
or in the aggregate on the business, assets or financial condition of the
Borrower and its Subsidiaries taken as a whole. Since the Balance Sheet Date,
the Borrower has not made any Distributions except Distributions made in
compliance with Section 6.4 hereof.
SECTION 4.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. The Borrower and
each of its Subsidiaries possesses all franchises, patents, copyrights,
trademarks, trade names, licenses and permits, and rights in respect of the
foregoing, adequate for the conduct of its business substantially as now
conducted without known conflict with any rights of others.
SECTION 4.7. LITIGATION. Except as set forth in SCHEDULE 4.7 hereto,
there are no actions, suits, proceedings or investigations of any kind pending
or, to the best of the Borrower's knowledge, threatened against the Borrower or
any of its Subsidiaries before any court, tribunal or administrative agency or
board that, if adversely determined, might, either in any case or in the
aggregate, materially
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adversely affect the properties, assets, financial condition or business of the
Borrower and its Subsidiaries taken as a whole, or materially impair the right
of the Borrower and each of its Subsidiaries to carry on business substantially
as now conducted by it, or result in any substantial liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
consolidated balance sheet of the Borrower and its Subsidiaries or which
question the validity of this Credit Agreement or any of the other Loan
Documents, or any action taken or to be taken pursuant hereto or thereto.
SECTION 4.8. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the
Borrower nor any of its Subsidiaries is in violation of any provision of its
charter documents, bylaws, or any agreement or instrument to which it may be
subject or by which it or any of its properties may be bound or any decree,
order, judgment, statute, license, rule or regulation, in any of the foregoing
cases in a manner that could result in the imposition of substantial penalties
or materially and adversely affect the financial condition, properties or
business of the Borrower and its Subsidiaries taken as a whole.
SECTION 4.9. TAX STATUS. The Borrower and each of its Subsidiaries (a)
has made or filed all applicable federal and state income and all other tax
returns, reports and declarations required by any jurisdiction to which it is
subject, (b) has paid all taxes and other governmental assessments and charges
shown or determined to be due on such returns, reports and declarations, except
those being contested in good faith and by appropriate proceedings and (c) has
set aside on its books provisions reasonably adequate for the payment of all
taxes for periods subsequent to the periods to which such returns, reports or
declarations apply. Except as set forth on SCHEDULE 4.9 attached hereto, there
are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Borrower know of no basis
for any such claim.
SECTION 4.10. NO EVENT OF DEFAULT. No Default or Event of Default has
occurred and is continuing.
SECTION 4.11. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an affiliate" of a "holding company", as
such terms are defined in the Public Utility Holding Company Act of 1935; nor is
such Person a "registered investment company", or a "principal underwriter" of a
"registered investment company", or a company controlled by a "registered
investment company", as such terms are defined in the Investment Company Act of
1940.
SECTION 4.12. EMPLOYEE BENEFIT PLANS.
SECTION 4.12.1. IN GENERAL. Each Employee Benefit Plan has
been maintained and operated in compliance in all material respects with the
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provisions of ERISA and, to the extent applicable, the Code, including but not
limited to the provisions thereunder respecting prohibited transactions.
SECTION 4.12.2. TERMINABILITY OF WELFARE PLANS. Under each
Employee Benefit Plan which is an employee welfare benefit plan within the
meaning of Section 3(1) or Section 3(2)(B) of ERISA, no benefits are due unless
the event giving rise to the benefit entitlement occurs prior to plan
termination (except as required by Title I, Part 6 of ERISA). The Borrower or an
ERISA Affiliate, as appropriate, may terminate each such Plan at any time (or at
any time subsequent to the expiration of any applicable bargaining agreement) in
the discretion of the Borrower or such ERISA Affiliate without liability to any
Person.
SECTION 4.12.3. GUARANTEED PENSION PLANS. Each
contribution required to be made to a Guaranteed Pension Plan, whether required
to be made to avoid the incurrence of an accumulated funding deficiency, the
notice or lien provisions of Section 302(f) of ERISA, or otherwise, has been
timely made. No waiver of an accumulated funding deficiency or extension of
amortization periods has been received with respect to any Guaranteed Pension
Plan. No liability to the PBGC (other than required insurance premiums, all of
which have been paid) has been incurred by the Borrower or any ERISA Affiliate
with respect to any Guaranteed Pension Plan and there has not been any ERISA
Reportable Event, or any other event or condition which presents a material risk
of termination of any Guaranteed Pension Plan by the PBGC. Based on the latest
valuation of each Guaranteed Pension Plan (which in each case occurred within
twelve months of the date of this representation), and on the actuarial methods
and assumptions employed for that valuation, except as set forth on SCHEDULE
4.12 attached hereto, the aggregate benefit liabilities of all such Guaranteed
Pension Plans within the meaning of Section 4001 of ERISA did not exceed the
aggregate value of the assets of all such Guaranteed Pension Plans, disregarding
for this purpose the benefit liabilities and assets of any Guaranteed Pension
Plan with assets in excess of benefit liabilities.
SECTION 4.12.4. MULTIEMPLOYER PLANS. Neither the Borrower
nor any ERISA Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under Section 4201 of ERISA or as a
result of a sale of assets described in Section 4204 of ERISA. Neither the
Borrower nor any ERISA Affiliate has been notified that any Multiemployer Plan
is in reorganization or insolvent under and within the meaning of Section 4241
or Section 4245 of ERISA or that any Multiemployer Plan intends to terminate or
has been terminated under Section 4041A of ERISA.
SECTION 4.13. REGULATIONS U AND X; ETC. The proceeds of the Revolving
Credit Loans shall be used for the purposes described in Section 5.12 hereof. No
portion of any Revolving Credit Loan is to be used for the purpose of purchasing
or carrying any "margin security" or "margin stock" (as such terms are used in
Regulations U and X of the Board of Governors of the Federal Reserve System, 12
C.F.R. Parts 221 and 224 (the "MARGIN REGULATIONS")) in violation of the Margin
Regulations.
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SECTION 4.14. ENVIRONMENTAL COMPLIANCE. The Borrower has taken all
reasonably necessary steps to investigate the past and present condition and
usage of the Real Estate and the operations conducted thereon and, based upon
such diligent investigation, has determined that:
(a) none of the Borrower, its Subsidiaries nor any operator of
the Real Estate or any operations thereon is in violation, or alleged violation,
of any Environmental Laws, which violation would have a material adverse effect
on the business, assets or financial condition of the Borrower and its
Subsidiaries taken as a whole;
(b) neither the Borrower nor any of its Subsidiaries has
received any Environmental Notice during the last five (5) years that has the
potential to materially affect the assets, liabilities, financial condition or
operations of the Borrower and its Subsidiaries taken as a whole, except as set
forth on SCHEDULE 4.14 hereto;
(c) except as set forth on SCHEDULE 4.14 attached hereto: (i)
no portion of the Real Estate has been used for the handling, processing,
storage or disposal of Hazardous Substances; and no underground tank or other
underground storage receptacle for Hazardous Substances is located on any
portion of the Real Estate; in each case except in accordance with applicable
Environmental Laws the noncompliance with which would have a material adverse
effect on the business, assets or financial condition of the Borrower and its
Subsidiaries, taken as a whole; (ii) in the course of any activities conducted
by the Borrower or operators of its properties, no Hazardous Substances have
been generated or are being used on the Real Estate except in accordance with
applicable Environmental Laws the noncompliance with which would have a material
adverse effect on the business, assets or financial condition of the Borrower
and its Subsidiaries, taken as a whole; (iii) there have been no releases or
threatened releases of Hazardous Substances on, upon, into or from the
properties of the Borrower or any of its Subsidiaries, which releases would have
a material adverse effect on the business, assets or financial condition of the
Borrower and its Subsidiaries, taken as a whole; (iv) to the best of the
Borrower's knowledge, there have been no releases on, upon, from or into any
real property in the vicinity of any of the Real Estate which, through soil or
groundwater contamination, may have come to be located on the Real Estate and
which would have a material adverse effect on the Borrower and its Subsidiaries,
taken as a whole; and (v) in addition, any Hazardous Substances that have been
generated on any of the Real Estate have, to the best of the Borrower's
knowledge, been transported offsite only as required under and in compliance
with applicable Environmental Laws.
SECTION 4.15. SUBSIDIARIES, ETC. As of the Closing Date, other than
those Subsidiaries of the Borrower described on SCHEDULE 4.15(a) attached
hereto, the Borrower has no other Subsidiaries. As of the Closing Date, except
as set forth on SCHEDULE 4.15(b) attached hereto, neither the Borrower nor any
Subsidiary of the Borrower is engaged in any joint venture or partnership with
any other Person. As of the Closing Date, except as set forth on SCHEDULE
4.15(c) attached
<PAGE>
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hereto, neither the Borrower nor any Subsidiary of the Borrower owns or has
acquired an equity interest of fifty percent (50%) or less in any other Person.
The Borrower hereby agrees to deliver to the Banks an updated SCHEDULE 4.15(a),
SCHEDULE 4.15(b) or SCHEDULE 4.15(c), as applicable, upon the acquisition or
formation by the Borrower of any Subsidiary, the formation of any joint venture
or partnership by the Borrower or any of its Subsidiaries with any other Person
or the acquisition by the Borrower or any of its Subsidiaries of an equity
interest of fifty percent (50%) or less in any other Person, in each case in
accordance with the provisions of this Credit Agreement.
SECTION 5. AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower
covenants and agrees that, so long as any Revolving Credit Loan or Revolving
Credit Note is outstanding or any Bank has any obligation to make any Revolving
Credit Loans:
SECTION 5.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually
pay or cause to be paid the principal and interest on the Revolving Credit
Loans, the Facility Fee, the Agent Fees and all other amounts provided for in
this Credit Agreement and the other Loan Documents to which the Borrower is a
party, all in accordance with the terms of this Credit Agreement and such other
Loan Documents.
SECTION 5.2. MAINTENANCE OF OFFICE. The Borrower will maintain its
chief executive office in Framingham, Massachusetts, or at such other place in
the United States of America as the Borrower shall designate upon written notice
to the Agent, where notices, presentations and demands to or upon the Borrower
in respect of the Loan Documents to which the Borrower is a party may be given
or made.
SECTION 5.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and
cause each of its Subsidiaries to keep, true and accurate records and books of
account in which full, true and correct entries will be made in accordance with
generally accepted accounting principles and (b) maintain adequate accounts and
reserves for all taxes, depreciation, depletion, obsolescence and amortization
of its properties and the properties of its Subsidiaries, contingencies, and
other reserves.
SECTION 5.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The
Borrower will deliver to the Agent (and the Agent will promptly, after receipt
thereof, deliver to the Banks):
(a) as soon as practicable, but in any event not later than
one hundred ten (110) days after the end of each fiscal year of the Borrower,
the consolidated balance sheet of the Borrower and its Subsidiaries as at the
end of such year, and the related consolidated statement of income and
consolidated statement of cash flow for such year, each setting forth in
comparative form the figures for the previous fiscal year and all such
consolidated statements to be in reasonable detail, prepared in accordance with
generally accepted accounting
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principles, and certified without qualification by Ernst & Young or by other
independent certified public accountants reasonably satisfactory to the Agent;
(b) as soon as practicable, but in any event not later than
sixty-five (65) days after the end of each of the first three fiscal quarters of
the Borrower, copies of the unaudited consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such quarter, and the related consolidated
statement of income and consolidated statement of cash flow for the portion of
the Borrower's fiscal year then elapsed, all in reasonable detail and prepared
in accordance with generally accepted accounting principles, together with a
certification by the chief financial officer or the treasurer of the Borrower
that to the best of the Borrower's knowledge, the information contained in such
financial statements fairly presents the financial position of the Borrower and
its Subsidiaries on the date thereof (subject to year-end adjustments);
(c) simultaneously with the delivery of the financial
statements referred to in subsections (a) and (b) above, a statement certified
by the chief financial officer or the treasurer of the Borrower in substantially
the form of EXHIBIT C attached hereto (a "COMPLIANCE CERTIFICATE") and setting
forth in reasonable detail computations evidencing compliance with the covenants
contained in Section 7 hereof and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance Sheet
Date; and
(d) from time to time such other financial data and
information as the Agent or any Bank may reasonably request.
All Confidential Information concerning the Borrower supplied by the Borrower to
the Banks pursuant to the terms hereof will be held in confidence by the Banks
and the Banks shall not disclose such Confidential Information except that the
Borrower authorizes each Bank to disclose any Confidential Information obtained
pursuant to this Credit Agreement or any other Loan Document (i) to any bank
regulatory authority, (ii) to any independent auditor or counsel or participant
or potential assignee or potential participant of such Bank, PROVIDED that such
independent auditor or counsel or participant or potential assignee or potential
participant enters into a confidentiality agreement with the Borrower
substantially similar to such Bank's agreement with the Borrower, and (iii) to
all other appropriate governmental regulatory authorities to the extent required
by such Bank by law or subpoena, but only to the extent permitted by applicable
laws and regulations, including those applying to classified material.
SECTION 5.5. NOTICES. The Borrower will promptly notify the Agent for
the benefit of the Banks in writing of the occurrence of any Default or Event of
Default. The Borrower will promptly give notice to the Agent for the benefit of
the Banks (a) of any material violation of any Environmental Law that the
Borrower or any of its Subsidiaries reports in writing or is reportable by such
Person in writing (or for which any written report supplemental to any oral
report is made) to any federal, state or local environmental agency and (b) upon
becoming aware thereof, of any inquiry, proceeding, investigation, or other
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action, including a notice from any agency of potential environmental liability,
or any federal, state or local environmental agency or board, that has the
potential to materially affect the assets, liabilities, financial conditions or
operations of the Borrower. The Borrower will give notice to the Agent for the
benefit of the Banks in writing within fifteen (15) days of becoming aware of
any litigation or proceedings threatened in writing or any pending litigation
and proceedings affecting the Borrower or any of its Subsidiaries or to which
the Borrower or any of its Subsidiaries is or becomes a party involving an
uninsured claim against the Borrower or any of its Subsidiaries that could
reasonably be expected to have a materially adverse effect on the Borrower and
its Subsidiaries taken as a whole and stating the nature and status of such
litigation or proceedings. The Borrower will, and will cause each of its
Subsidiaries to, give notice to the Agent for the benefit of the Banks, in
writing, in form and detail satisfactory to the Agent, within ten (10) days of
any judgment not covered by insurance, final or otherwise, against the Borrower
or any of its Subsidiaries in an amount in excess of $1,000,000.
SECTION 5.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. The
Borrower will do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, rights and franchises and
those of its Subsidiaries. It (a) will cause all of its properties and those of
its Subsidiaries used or useful in the conduct of its business or the business
of its Subsidiaries to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment, (b) will cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Borrower may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times, and (c) will, and will cause each of its Subsidiaries
to, continue to engage primarily in the businesses now conducted by them and in
related businesses; PROVIDED that nothing in this Section 5.6 shall prevent the
Borrower from discontinuing the operation and maintenance of any of its
properties or any of those of its Subsidiaries if such discontinuance is, in the
judgment of the Borrower, desirable in the conduct of its or their business and
does not in the aggregate materially adversely affect the business of the
Borrower and its Subsidiaries on a consolidated basis.
SECTION 5.7. INSURANCE. The Borrower will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent.
SECTION 5.8. TAXES. The Borrower will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor,
<PAGE>
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materials, or supplies that if unpaid might by law become a lien or charge upon
any of its property; PROVIDED that any such tax, assessment, charge, levy or
claim need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if the Borrower or such
Subsidiary shall have set aside on its books adequate reserves with respect
thereto; and PROVIDED FURTHER that the Borrower and each Subsidiary of the
Borrower will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any lien that may
have attached as security therefor or shall have obtained such bonding as may be
required to release such lien.
SECTION 5.9. INSPECTION OF PROPERTIES AND BOOKS, ETC. The Borrower
shall permit the Banks, through the Agent or any of the Banks' other designated
representatives, no more frequently than once each calendar year, or more
frequently as determined by the Banks upon the occurrence and during the
continuance of an Event of Default, to visit and inspect any of the properties
of the Borrower or any of its Subsidiaries, and each such inspection, if no
Event of Default has occurred and is continuing, shall be at the Banks' expense.
The Borrower shall also permit the Banks, through the Agent or any of the Banks'
other designated representatives, to examine the books of account of the
Borrower and its Subsidiaries (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the Borrower
and its Subsidiaries with, and to be advised as to the same by, its and their
officers, all at such reasonable times and intervals as the Agent or any Bank
may reasonably request. The Borrower authorizes the Agent and, if accompanied by
the Agent, the Banks to communicate directly with the Borrower's independent
certified public accountants and authorizes such accountants to disclose to the
Agent and the Banks any and all financial statements and other supporting
financial documents and schedules with respect to the business, financial
condition and other affairs of the Borrower or any of its Subsidiaries.
SECTION 5.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS.
The Borrower will, and will cause each of its Subsidiaries to, comply with (a)
the applicable laws and regulations wherever its business is conducted,
including all Environmental Laws, (b) the provisions of its charter documents
and by-laws, (c) all agreements and instruments by which it or any of its
properties may be bound and (d) all applicable decrees, orders, and judgments,
in each case if noncompliance with which would have a material adverse effect on
the business, assets or financial condition of the Borrower and its
Subsidiaries, taken as a whole, or on the ability of the Borrower or any of the
Guarantors to fulfill its obligations under this Credit Agreement or any of the
other Loan Documents to which such Person is a party. If any authorization,
consent, approval, permit or license from any officer, agency or instrumentality
of any government shall become necessary or required in order that the Borrower
may fulfill any of its obligations hereunder or any of the other Loan Documents
to which the Borrower is a party, the Borrower will, or (as the case may be)
will cause such Subsidiary to, immediately take or cause to be taken all
reasonable steps within the power of the Borrower or such Subsidiary to obtain
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such authorization, consent, approval, permit or license and furnish the Agent
and the Banks with evidence thereof.
SECTION 5.11. EMPLOYEE BENEFIT PLANS. The Borrower will (i) promptly
upon request of the Agent, furnish to the Agent a copy of the most recent
actuarial statement required to be submitted under Section 103(d) of ERISA and
Annual Report, Form 5500, with all required attachments, in respect of each
Guaranteed Pension Plan and (ii) promptly upon receipt or dispatch, furnish to
the Agent any notice, report or demand sent or received in respect of a
Guaranteed Pension Plan under Sections 302, 4041, 4042, 4043, 4063, 4065, 4066
and 4068 of ERISA, or in respect of a Multiemployer Plan, under Sections 4041A,
4202, 4219, 4242, or 4245 of ERISA.
SECTION 5.12. USE OF PROCEEDS. The Borrower will use the proceeds of
the Revolving Credit Loans solely for working capital and general corporate
purposes, including, without limitation, for the acquisition of assets and or
Capital Stock of Persons in the same line of business as the Borrower or any
Subsidiary of the Borrower, to the extent permitted under this Credit Agreement.
SECTION 5.13. LICENSES AND PERMITS. The Borrower will maintain and
renew any and all licenses or permits now held or hereafter acquired by the
Borrower or any of its Subsidiaries unless the loss, suspension, revocation or
failure to renew any such licenses or permits would not have a material adverse
effect on the business or financial condition of the Borrower and such
Subsidiary.
SECTION 5.14. FURTHER ASSURANCES. The Borrower will, and will cause
each of the Guarantors to, cooperate with the Banks and the Agent and execute
such further instruments and documents as the Banks or the Agent shall
reasonably request to carry out to their satisfaction the transactions
contemplated by this Credit Agreement and the other Loan Documents.
SECTION 6. CERTAIN NEGATIVE COVENANTS OF THE BORROWER. The Borrower
covenants and agrees that, so long as any Revolving Credit Loan or Revolving
Credit Note is outstanding or any Bank has any obligation to make any Revolving
Credit Loans:
SECTION 6.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and
will not permit any of its Subsidiaries to, create, incur, assume, guarantee or
become or remain liable, contingently or otherwise, with respect to Indebtedness
other than:
(a) Indebtedness to the Banks and the Agent arising under
any of the Loan Documents;
(b) current liabilities of the Borrower or such Subsidiary
incurred in the ordinary course of business not incurred through (i) the
borrowing of money, or (ii) the obtaining of credit except for credit on an open
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account basis customarily extended and in fact extended in connection with
normal purchases of goods and services;
(c) Indebtedness in respect of taxes, assessments,
governmental charges or levies and claims for labor, materials and supplies to
the extent that payment therefor shall not at the time be required to be made in
accordance with the provisions of Section 5.8 hereof;
(d) Indebtedness in respect of judgments or awards that
have been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the Borrower
or such Subsidiary shall at the time in good faith be prosecuting an appeal or
proceedings for review and in respect of which a stay of execution shall have
been obtained pending such appeal or review;
(e) endorsements for collection, deposit or negotiation
and warranties of products or services, in each case incurred in the ordinary
course of business;
(f) Indebtedness in respect of documentary letters of
credit issued in the ordinary course of business;
(g) Indebtedness of the Borrower in respect of interest
rate protection arrangements and exchange rate protection arrangements;
(h) Indebtedness existing on the Closing Date and listed
and described on SCHEDULE 6.1(h) hereto or any refinancing thereof on
substantially similar terms as the Indebtedness being refinanced;
(i) Subordinated Debt;
(j) obligations under Capitalized Leases;
(k) Indebtedness arising under an accounts receivable
financing facility entered into by the Borrower or a Subsidiary of the Borrower
on terms and conditions and pursuant to documentation in form and substance
reasonably satisfactory to the Banks, PROVIDED that the maximum facility amount
of such accounts receivable financing facility shall not exceed $200,000,000;
(l) Indebtedness in respect of (i) intercompany loans and
guaranties from the Borrower to any of its Subsidiaries or of any of its
Subsidiaries' obligations or (ii) intercompany loans and guaranties between
Subsidiaries of the Borrower or (iii) intercompany loans and guaranties from any
Guarantor to the Borrower or of any of the Borrower's obligations or (iv)
guaranties from any Subsidiary of the Borrower of any of the Borrower's
obligations, PROVIDED that the Investments corresponding to such Indebtedness
are permitted under Sections 6.3(j) or 6.3(k) hereof;
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(m) Indebtedness incurred in connection with the
acquisition after the Closing Date of any real or personal property by the
Borrower or any Subsidiary of the Borrower as contemplated by Section 6.2(ix)
hereof;
(n) Indebtedness of the Borrower and its Subsidiaries in
respect of Investments in and contingent obligations to make Investments in
non-Guarantor Subsidiaries; PROVIDED THAT the Investments corresponding to such
Indebtedness are permitted under Section 6.3(k) hereof;
(o) Indebtedness secured by a lien on Real Estate of the
Borrower or its Subsidiaries; PROVIDED that the aggregate amount of Indebtedness
permitted pursuant to this Section 6.1(o) shall not, at any time, exceed the
fair market value of the Real Estate securing such Indebtedness;
(p) other Indebtedness of the Borrower and its
Subsidiaries (whether or not such Subsidiaries are Guarantors), PROVIDED that
(i) with respect to Indebtedness incurred by the Borrower or a Guarantor, such
Indebtedness contains covenants that are no more restrictive on the Borrower or
such Guarantor than the covenants contained in this Credit Agreement and (ii)
immediately after such incurrence of Indebtedness, and after giving effect
thereto on a PRO FORMA basis, no Default or Event of Default shall then exist;
(q) Indebtedness of the Borrower and its Subsidiaries
incurred pursuant to that certain Revolving Credit Agreement, dated as of
November 13, 1997, as amended, by and among the Borrower, the lending
institutions party thereto, Fleet National Bank (f/k/a BankBoston, N.A.), as
administrative and documentation agent for such lending institutions, The Chase
Manhattan Bank, as syndication agent for such lending institutions, and the
co-agents named therein; and
(r) Indebtedness consisting of Investments permitted under
Section 6.3(n) hereof.
Notwithstanding the foregoing, at no time shall the aggregate amount of
Indebtedness of the Borrower and its Subsidiaries consisting of guaranties and
other Contingent Liabilities (excluding (i) Indebtedness permitted pursuant to
Section 6.1 to the extent such Indebtedness (or if such Indebtedness is a
Contingent Liability of the Borrower and/or its Subsidiaries, the underlying
Indebtedness relating to such Contingent Liability) is included in the
calculation of Total Funded Indebtedness) and (ii) obligations in respect of
documentary letters of credit) exceed, in the aggregate, 15% of the
Stockholders' Equity of the Borrower at such time. For purposes of this Section,
the amount of Contingent Liabilities in respect of interest rate protection
arrangements and exchange rate protection arrangements permitted under Section
6.1(g) at any time shall be the net liability of the Borrower and its
Subsidiaries under such arrangements at such time, calculated on a basis
satisfactory to the Agent in accordance with accepted practice.
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SECTION 6.2. RESTRICTIONS ON LIENS. The Borrower will not, and will not
permit any of its Subsidiaries to, (a) create or incur or suffer to be created
or incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (b) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (c) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (d) suffer to exist
for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency under the laws of the United States of
America or any state thereof, or otherwise, be given any priority whatsoever
over its general creditors; or (e) sell, assign, pledge or otherwise transfer
any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; PROVIDED that the Borrower and any
Subsidiary of the Borrower may create or incur or suffer to be created or
incurred or to exist:
(i) liens in favor of the Borrower on all or part of
the assets of Subsidiaries of the Borrower securing Indebtedness owing by
Subsidiaries of the Borrower to the Borrower;
(ii) liens to secure taxes, assessments and other
government charges and liens to secure claims for labor, material or supplies,
in each case in respect of obligations not overdue or which are being contested
in good faith and by appropriate proceedings and for which the Borrower or such
Subsidiary has set aside on its books adequate reserves with respect thereto;
(iii) deposits or pledges made in connection with, or
to secure payment of, worker's compensation, unemployment insurance, old age
pensions or other social security obligations;
(iv) liens in respect of judgments or awards that
have been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the Borrower
or such Subsidiary is at the time in good faith prosecuting an appeal and in
respect of which a stay of execution shall have been obtained pending such
appeal or shall have obtained an unsecured bond sufficient to release such lien;
(v) liens of carriers, warehousemen, mechanics and
materialmen, and other like liens, in respect of obligations not overdue or, if
such obligations are overdue, being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary shall have set aside
on its books adequate reserves with respect thereto, PROVIDED that no proceeding
to foreclose any such lien shall have been commenced;
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(vi) encumbrances on Real Estate consisting of
easements, rights of way, zoning restrictions, restrictions on the use of real
property and defects and irregularities in the title thereto, landlord's or
lessor's liens under Capitalized Leases to which the Borrower or a Subsidiary of
the Borrower is a party, and other minor liens or encumbrances none of which in
the opinion of the Borrower interferes materially with the use of the property
affected in the ordinary conduct of the business of the Borrower and its
Subsidiaries, which defects do not individually or in the aggregate have a
materially adverse effect on the business of the Borrower individually or of the
Borrower and its Subsidiaries on a consolidated basis;
(vii) liens existing on the Closing Date and listed
on SCHEDULE 6.2 attached hereto or liens on the same assets in connection with
the refinancing of such existing liens;
(viii) liens arising in the ordinary course of
business of the Borrower or a Subsidiary of the Borrower none of which in the
opinion of the Borrower interferes materially with the use of the property
affected in the ordinary course of business of the Borrower and its Subsidiaries
and which do not, individually or in the aggregate, have a materially adverse
effect on the business of the Borrower or such Subsidiary individually or of the
Borrower and its Subsidiaries on a consolidated basis;
(ix) purchase money security interests in or
purchase money mortgages on real or personal property acquired after the
Closing Date to secure purchase money Indebtedness of the type permitted by
Section 6.1(m) hereof, incurred in connection with the acquisition of such
property, which security interests or mortgages cover only the real or
personal property so acquired;
(x) liens on accounts receivable of the Borrower
and/or its Subsidiaries that are the subject of and secure the accounts
receivable financing facility permitted under Section 6.1(k) hereof;
(xi) liens securing other permitted Indebtedness that
does not exceed $10,000,000 in the aggregate;
(xii) liens in respect of the interests of lessors
under Capitalized Leases; and
(xiii) liens on Real Estate securing Indebtedness
permitted under Section 6.1(o) hereof.
SECTION 6.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and
will not permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the
United States of America;
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(b) demand deposits, certificates of deposit, bankers
acceptances and time deposits of (i) United States or Canadian banks having
total assets in excess of $1,000,000,000 or (ii) a commercial bank organized
under the laws of any other country which is a member of the Organization for
Economic Cooperation and Development (the "OECD"), or a political subdivision of
such country, and having total assets in excess of $1,000,000,000, PROVIDED that
such bank is acting through a branch or agency located in the country in which
its is organized or another country which is a member of the OECD;
(c) (i) securities commonly known as "commercial paper"
denominated in Dollars which at the time of purchase have been rated and the
ratings for which are not less than "P 1" if rated by Moody's, and not less than
"A 1" if rated by S&P; and (ii) securities commonly known as "short-term bank
notes" issued by any Bank denominated in Dollars which at the time of purchase
have been rated and the ratings for which are not less than "P 2" if rated by
Moody's, and not less than "A 2" if rated by S&P;
(d) Investments existing on the Closing Date and listed on
SCHEDULE 6.3 attached hereto;
(e) Investments with respect to Indebtedness permitted by
Section 6.1(k) hereof so long as such entities remain Subsidiaries of the
Borrower;
(f) taxable or tax-exempt securities which at the time of
purchase have been rated and the ratings for which are not less than A 3 if
rated by Moody's, and not less than A- if rated by S&P;
(g) Investments consisting of loans and advances to
employees of the Borrower or any Subsidiary of the Borrower, not exceeding
$1,000,000 in the aggregate at any one time outstanding;
(h) options to invest in or to lease real property to be
used in the operations of the Borrower or any Subsidiary of the Borrower;
(i) guaranties by endorsement of negotiable instruments
for deposit or collection or similar transactions effected in the ordinary
course of business;
(j) (i) the Borrower's or any Subsidiary's guaranty of the
Indebtedness of any Guarantor or the Borrower, (ii) any other Investments by the
Borrower or any Guarantor in any Guarantor or the Borrower, and (iii) any
Investments (other than loans) by any Subsidiary of the Borrower in any
Guarantor or the Borrower;
(k) Investments by the Borrower or any Subsidiary of the
Borrower in any of the Borrower's Subsidiaries (other than Guarantors), PROVIDED
that the aggregate amount of (i) such Investments in, intercompany loans to and
guaranties of, the obligations of such Subsidiaries and (ii) Investments
otherwise permitted by Section 6.3(m) hereof, shall at no time exceed 65%
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of the Stockholders' Equity of the Borrower, and PROVIDED, FURTHER, that the
aggregate amount of Investments in, intercompany loans to and guaranties of, the
obligations of each Domestic Subsidiary (other than Guarantors) shall not exceed
$35,000,000 at any time;
(l) Investments by the Borrower or any Subsidiary of the
Borrower to acquire any Person, PROVIDED that such acquisition is permitted
under Section 6.6 hereof;
(m) Investments by the Borrower or any Subsidiary of the
Borrower to acquire up to a fifty percent (50%) equity interest in another
Person, PROVIDED that (i) such Person is in the same line of business as the
Borrower or such Subsidiary, as applicable, (ii) the aggregate amount of (A)
such Investments in such Person, (B) existing Investments made by the Borrower
or any Subsidiary of the Borrower pursuant to this Section 6.3(m), and (C)
Investments otherwise permitted by Section 6.3(k) hereof, shall at no time
exceed 65% of the Stockholders' Equity of the Borrower, and (iii) the
consideration for such interest shall be the exchange by the Borrower or such
Subsidiary as applicable, of a certain number of shares of its common stock for
equity securities of the other Person and/or the payment in cash in an aggregate
cash amount for any such Investment not to exceed $50,000,000; and
(n) Investments in respect of (i) loans made by the
Borrower to certain of its employees and other Persons and (ii) guaranties of
loans made by third parties to certain of the Borrower's employees and other
Persons (such loans made by the Borrower and such loans made by third parties
and guaranteed by the Borrower are referred to herein, collectively, as the
"OPTION LOANS"), PROVIDED that (A) the aggregate principal amount of the Option
Loans made and guaranteed by the Borrower during the period from October 29,
1999 through October 31, 2000 shall not exceed $30,000,000, (B) the aggregate
principal amount of Option Loans made and guaranteed by the Borrower during each
twelve (12) month period beginning on November 1st of each year (commencing with
November 1, 2000) and ending on October 31st of the following year shall not
exceed $12,000,000, (C) the proceeds of the Option Loans will be paid by such
Persons to the Borrower as consideration for the purchase by such Persons of
Staples.com stock pursuant to the Borrower's stock option and stock purchase
plans.
SECTION 6.4. DISTRIBUTIONS. The Borrower will not declare any dividend
or make any Distribution if any Default or Event of Default has occurred and is
continuing or would result after giving effect to such Distribution.
SECTION 6.5. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA
Affiliate will engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code which could result in a
material liability for the Borrower or any of its Subsidiaries; or permit any
Guaranteed Pension Plan to incur an "accumulated funding deficiency", as such
term is defined in Section 302 of ERISA, whether or not such deficiency is or
may be waived; or fail to contribute
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to any Guaranteed Pension Plan to an extent which, or terminate any Guaranteed
Pension Plan in a manner which, could result in the imposition of a lien or
encumbrance on the assets of the Borrower or any of its Subsidiaries pursuant to
Section 302(f) or Section 4068 of ERISA; or permit or take any action which
would result in the aggregate benefit liabilities (with the meaning of Section
4001 of ERISA) of all Guaranteed Pension Plans exceeding the value of the
aggregate assets of such Plans, disregarding for this purpose the benefit
liabilities and assets of any such Plan with assets in excess of benefit
liabilities.
SECTION 6.6. MERGER AND CONSOLIDATION. The Borrower will not, and will
not permit any of its Subsidiaries to, merge or consolidate with any other
Person; enter into any stock or asset acquisitions (other than the acquisition
of assets in the ordinary course of such Person's business and other than the
acquisition of stock permitted under Section 6.3(k) hereof); enter into any
joint venture or partnerships (except to the extent permitted under Section 6.3
hereof); or enter into any new lines of business or otherwise change the conduct
of the Borrower's or such Subsidiary's business as presently conducted; other
than (a) the merger or consolidation of one or more Subsidiaries of the Borrower
with and into the Borrower, PROVIDED that the Borrower is the surviving entity,
(b) the merger or consolidation of two or more Subsidiaries of the Borrower,
PROVIDED that, if one of the Subsidiaries is a Guarantor, that the Guarantor is
the surviving entity, or (c) the acquisition (whether of stock or assets or by
means of a merger) of any other Person, PROVIDED that (i) immediately after such
acquisition, and after giving effect thereto on a PRO FORMA basis, no Default or
Event of Default shall then exist, (ii) if required by applicable law, the board
of directors and the shareholders or the equivalent, of such other Person has
approved such acquisition, (iii) such other Person is in the business of selling
office services, products and/or supplies, (iv) in connection with any such
acquisition involving an aggregate consideration (including assumption of
Indebtedness) in an amount greater than ten percent (10%) of the Consolidated
Tangible Net Worth of the Borrower and its Subsidiaries, determined immediately
prior to such acquisition, the Borrower shall have delivered to the Agent and
the Banks prior written notice of the proposed acquisition, (v) if the Borrower
or a Guarantor and such other Person merge, the Borrower or such Guarantor is
the surviving entity, and (vi) contemporaneously with such acquisition, the
requirements of Section 5.14, if applicable, shall have been satisfied.
SECTION 6.7. DISPOSITION OF ASSETS AND SALE-LEASEBACK TRANSACTIONS. The
Borrower will not, and will not permit any of its Subsidiaries to, dispose of or
sell assets other than:
(a) the disposition of assets in the ordinary course of
business,
(b) sale-leaseback transactions and other dispositions of
assets that do not have a materially adverse effect on the business, assets or
financial condition of the Borrower or any of its Subsidiaries, PROVIDED that
(i) the aggregate net book value of the assets to be sold PLUS the net book
value of all other assets of the Borrower and its Subsidiaries sold under this
clause (b) during the period of time from the Closing Date through the date of
such sale
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does not, at the time of such sale, exceed 25% of the Consolidated Total Assets
of the Borrower and its Subsidiaries, (ii) such assets are sold in an arm's
length transaction for fair market value (after giving effect to all tax
benefits, if any, associated with such sale), and (iii) the Borrower shall, if
an Event of Default exists or would result from such sale, prepay the Revolving
Credit Loans by an amount equal to (A) 50% of the amount by which the aggregate
net sale proceeds of all assets sold pursuant to this clause (b) exceeds
$20,000,000 but is less than or equal to $50,000,000 PLUS (B) 100% of the amount
by which the aggregate net sale proceeds of all assets sold pursuant to this
clause (b) exceeds $50,000,000, and
(c) the sale of accounts receivable of the Borrower and/or
its Subsidiaries pursuant to an accounts receivable financing or securitization
facility entered into by the Borrower and/or a Subsidiary of the Borrower on
terms and conditions and pursuant to documentation in form and substance
reasonably satisfactory to the Banks, PROVIDED that the maximum facility amount
of such facility shall not exceed $200,000,000.
SECTION 6.8. SUBORDINATED DEBT. The Borrower will not effect or permit
any change in or amendment to any document or instrument pertaining to the
subordination, covenants, events of default, terms of payment or required
prepayments of any Subordinated Debt, give any notice of redemption or
prepayment or offer to repurchase under any such document or instrument or,
directly or indirectly, make any payment of principal of or interest on or in
redemption, retirement or repurchase of any Subordinated Debt, except that (a)
the Borrower may make regularly scheduled payments when required by the terms of
the Subordinated Debt, and (b) the Borrower may refinance all or a portion of
the Subordinated Debt so long as such refinancing Subordinated Debt (i) has a
maturity that is no earlier than the Subordinated Debt being refinanced and (ii)
is subordinated to the Obligations on terms at least as favorable to the Agent
and the Banks, in the opinion of the Agent and the Majority Banks, as the
Subordinated Debt being refinanced.
SECTION 7. FINANCIAL COVENANTS OF THE BORROWER. The Borrower covenants
and agrees that, so long as any Revolving Credit Loan or Revolving Credit Note
is outstanding:
SECTION 7.1. FIXED CHARGE COVERAGE RATIO. As at the end of each fiscal
quarter of the Borrower, the Borrower will not permit the ratio (the "FIXED
CHARGE COVERAGE RATIO") of (a) the sum of (i) Earnings Before Interest and Taxes
for the period of the four consecutive fiscal quarters (the "MEASUREMENT
PERIOD") ending on such date PLUS (ii) the Rental Expense for such Measurement
Period, to (b) the sum of (i) the Consolidated Total Interest Expense for such
Measurement Period PLUS (ii) the Rental Expense for such Measurement Period, to
be less than 1.50 to 1.
SECTION 7.2. FUNDED DEBT TO EBITDA RATIO. As at the end of each fiscal
quarter of the Borrower, the Borrower will not permit the ratio of (a) Total
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Funded Indebtedness as at such date to (b) Consolidated EBITDA for the period of
four consecutive fiscal quarters then ending, to be greater than 3.00 to 1.
SECTION 7.3. MINIMUM CONSOLIDATED TANGIBLE NET WORTH. The Borrower will
not permit Consolidated Tangible Net Worth to be, as at the end of any fiscal
quarter, less than the sum of (a) $1,000,000,000, PLUS (b) 50% of the cumulative
positive Consolidated Net Income (calculated as at the end of each of the fiscal
quarters beginning with the first fiscal quarter ending after January 30, 1999),
with no deductions for losses, PLUS (c) 50% of the aggregate book value of all
additional Capital Stock issued by the Borrower since January 30, 1999.
SECTION 8. CLOSING CONDITIONS. The obligations of the Banks to make the
initial Revolving Credit Loans shall be subject to the satisfaction of the
following conditions precedent:
SECTION 8.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto, shall be in full
force and effect and shall be in form and substance satisfactory to each of the
Banks. The Agent shall have received a fully executed copy of each such
document.
SECTION 8.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. The Agent shall
have received from the Borrower and each of the Guarantors a copy, certified by
a duly authorized officer of such Person to be true and complete on the Closing
Date, of each of (a) its charter or other incorporation documents as in effect
on such date of certification, and (b) its by-laws as in effect on such date.
SECTION 8.3. CORPORATE ACTION. All corporate action necessary for the
valid execution, delivery and performance by the Borrower and each of the
Guarantors of this Credit Agreement and the other Loan Documents to which it is
or is to become a party shall have been duly and effectively taken, and evidence
thereof satisfactory to the Banks shall have been provided to the Agent.
SECTION 8.4. INCUMBENCY CERTIFICATE. The Agent shall have received from
the Borrower and each of the Guarantors an incumbency certificate, dated as of
the Closing Date, signed by a duly authorized officer of the Borrower and each
Guarantor, as applicable, and giving the name and bearing a specimen signature
of each individual who shall be authorized: (a) to sign, in the name and to the
benefit of each of the Borrower and the Guarantors, each of the Loan Documents;
(b) with respect to the Borrower, to make Loan Requests and Conversion Requests;
and (c) to give notices and to take other action on its behalf under the Loan
Documents.
SECTION 8.5. OPINION OF COUNSEL. The Agent shall have received
favorable legal opinions addressed to the Banks and the Agent, dated as of the
Closing Date, in form and substance satisfactory to the Banks and the Agent,
from (a) Jack A. VanWoerkom, Esq., general counsel to the Borrower and the
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Guarantors, and (b) Hale and Dorr, special counsel to the Borrower and the
Guarantors.
SECTION 8.6. PAYMENT OF FEES. The Borrower shall have paid to the Agent
and the Arranger, as appropriate, the Agent Fees and all other fees and expenses
(including without limitation all reasonable legal fees and disbursements of the
Agent's Special Counsel) required to be paid by it.
SECTION 8.7. COMPLIANCE CERTIFICATE. The Borrower shall have delivered
to the Banks a Compliance Certificate, dated as of the Closing Date, and based
on the financial statements of the Borrower for the fiscal quarter ended April
29, 2000.
SECTION 8.8. NO MATERIAL ADVERSE CHANGE. The Agent shall be satisfied
that there shall have occurred no material adverse change in the business,
operations, assets, properties or condition of the Borrower or its Subsidiaries
since the Balance Sheet Date.
SECTION 9. CONDITIONS TO ALL BORROWINGS. The obligations of the Banks
to make any Revolving Credit Loan, whether on or after the Closing Date, shall
also be subject to the satisfaction of the following conditions precedent:
SECTION 9.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of any of the Borrower and its Subsidiaries
contained in this Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with this Credit Agreement
shall be true as of the date as of which they were made and shall also be true
at and as of the time of the making of such Revolving Credit Loan, with the same
effect as if made at and as of that time (except to the extent of changes
resulting from transactions contemplated or permitted by this Credit Agreement
and the other Loan Documents and changes occurring in the ordinary course of
business that singly or in the aggregate are not materially adverse, and to the
extent that such representations and warranties relate expressly to an earlier
date) and no Default or Event of Default shall have occurred and be continuing.
SECTION 9.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any
law or regulations thereunder or interpretations thereof that in the reasonable
opinion of any Bank would make it illegal for such Bank to make such Revolving
Credit Loan.
SECTION 9.3. GOVERNMENTAL REGULATION. Each Bank shall have received
such statements in substance and form reasonably satisfactory to such Bank as
such Bank shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of the
Federal Reserve System.
SECTION 9.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection
with the transactions contemplated by this Credit Agreement, the other Loan
Documents and all other documents incident thereto shall be reasonably
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satisfactory in substance and in form to the Banks and to the Agent and the
Agent's Special Counsel, and the Banks, the Agent and such counsel shall have
received all information and such counterpart originals or certified or other
copies of such documents as the Agent may reasonably request.
SECTION 10. EVENTS OF DEFAULT; ACCELERATION; ETC.
SECTION 10.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the
following events ("EVENTS OF DEFAULT" or, if the giving of notice or the lapse
of time or both is required, then, prior to such notice or lapse of time,
"DEFAULTS") shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of the
Revolving Credit Loans when the same shall become due and payable, whether at
the stated date of maturity or any accelerated date of maturity or at any other
date fixed for payment;
(b) the Borrower or any Guarantor shall fail to pay any
interest on the Revolving Credit Loans, the Facility Fee, the Agent Fees or
other sums due hereunder or under any of the other Loan Documents, within five
(5) Business Days of the date when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of maturity or at
any other date fixed for payment;
(c) the Borrower (i) shall fail to comply with any of its
covenants contained in Sections 5.4, 5.5, 5.10, 6 or 7 hereof, or (ii) shall
fail to comply with its covenant contained in Section 5.6 hereof and such
failure shall continue for thirty (30) days;
(d) the Borrower or any of its Subsidiaries shall fail to
perform any term, covenant or agreement contained herein or in any of the other
Loan Documents (other than those specified elsewhere in this Section 10.1) for
thirty (30) days after written notice of such failure has been given to the
Borrower by the Agent;
(e) any material representation or warranty of the Borrower or
any of its Subsidiaries in this Credit Agreement or any of the other Loan
Documents or in any other document or instrument delivered pursuant to or in
connection with this Credit Agreement shall prove to have been false in any
material respect upon the date when made or deemed to have been made or
repeated;
(f) the Borrower or any of its Subsidiaries shall fail to pay
at maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized Leases or any
obligations with respect to interest rate protection arrangements or exchange
rate protection arrangements which, in the aggregate, represents Indebtedness
(calculated, with respect to interest rate protection arrangements and exchange
rate protection arrangements based on the notional principal amount thereof) of
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$10,000,000 or more, or fail to observe or perform any material term, covenant
or agreement contained in any agreement by which it is bound, evidencing or
securing borrowed money or credit received or in respect of any Capitalized
Leases or evidencing any interest rate protection arrangement or exchange rate
protection arrangement which in the aggregate represents Indebtedness
(calculated, with respect to interest rate protection arrangements and exchange
rate protection arrangements based on the notional principal amount thereof) of
$10,000,000 or more, and for such period of time as would permit (assuming the
giving of appropriate notice if required) the holder or holders thereof or of
any obligations issued thereunder to accelerate the maturity thereof;
(g) the Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its inability to
pay or generally fail to pay its debts as they mature or become due, or shall
petition or apply for the appointment of a trustee or other custodian,
liquidator or receiver of the Borrower or any of its Subsidiaries or of any
substantial part of the assets of the Borrower or any of its Subsidiaries or
shall commence any case or other proceeding relating to the Borrower or any of
its Subsidiaries under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction, now or hereafter in effect, or shall take any action to authorize
or in furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against the Borrower or any of its Subsidiaries and shall not have
been dismissed within sixty (60) days, or the Borrower or any of its
Subsidiaries shall indicate its approval thereof, consent thereto or
acquiescence therein;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of its
Subsidiaries bankrupt or insolvent, or approving a petition in any such case or
other proceeding, or a decree or order for relief is entered in respect of the
Borrower or any Subsidiary of the Borrower in an involuntary case under federal
bankruptcy laws as now or hereafter constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, whether or not consecutive, any final
judgment against the Borrower or any of its Subsidiaries that, with other
outstanding final judgments, undischarged, against the Borrower or any of its
Subsidiaries exceeds in the aggregate $10,000,000;
(j) with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Majority Banks shall have
determined in their reasonable discretion that such event reasonably could be
expected to result in liability of the Borrower or any of its Subsidiaries to
the PBGC or such Guaranteed Pension Plan in an aggregate amount exceeding
$10,000,000 and such event in the circumstances occurring reasonably could
constitute grounds for the termination of such Guaranteed Pension Plan by the
PBGC or for the appointment by the appropriate United States District Court of a
trustee to administer such Guaranteed Pension Plan; or a trustee shall have
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been appointed by the United States District Court to administer such Plan; or
the PBGC shall have instituted proceedings to terminate such Guaranteed Pension
Plan;
(k) the holders of all or any part of the Subordinated Debt
shall accelerate the maturity of all or any part of the Subordinated Debt or the
Subordinated Debt shall be prepaid, redeemed or repurchased in whole or in part,
in each case in violation of the provisions of this Credit Agreement;
(l) if any of the Loan Documents shall be canceled,
terminated, revoked or rescinded, in each case otherwise than in accordance with
the terms thereof or with the express prior written agreement, consent or
approval of the Banks, or any action at law, suit or in equity or other legal
proceeding to cancel, revoke or rescind any of the Loan Documents shall be
commenced by or on behalf of the Borrower or any of its Subsidiaries party
thereto or any of their respective stockholders, or any court or any other
governmental or regulatory authority or agency of competent jurisdiction shall
make a determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof; or
(m) a "Change in Control" shall have occurred (which for the
purposes of this subsection (m) shall mean the occurrence of any of the
following events):
(i) the acquisition by any Person (including any syndicate
or group deemed to be a "person" under Section 13(d)(3) of the Securities and
Exchange Act of 1934, as amended) of beneficial ownership, directly or
indirectly, through a purchase, merger or other acquisition transaction or
series of transactions, of shares of Capital Stock of the Borrower entitling
such Person to exercise 50% or more of the total voting power of all shares of
Capital Stock of the Borrower entitled to vote generally in the elections of
directors (any shares of voting stock of which such person or group is the
beneficial owner that are not then outstanding being deemed outstanding for
purposes of calculating such percentage);
(ii) any consolidation of the Borrower with, or merger of
the Borrower into, any other Person, any merger of another Person into the
Borrower, or any sale or transfer of all or substantially all of the assets of
the Borrower to another Person (other than a transfer of assets to one or more
Guarantors or a merger (A) which does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Capital Stock of
the Borrower or (B) which is effected solely to change the jurisdiction of
incorporation of the Borrower); or
(iii) during any consecutive two-year period, individuals
who at the beginning of such period constituted the Board of Directors of the
Borrower (together with any new directors whose election by such Board of
Directors or whose nomination for election by the stockholders of the Borrower
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was approved by a vote of 66-2/3% of the directors then still in office who were
either directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Borrower then in office;
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrower declare all amounts owing with respect to this Credit Agreement,
the Revolving Credit Notes and the other Loan Documents to be, and they shall
thereupon forthwith become, immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by the Borrower; PROVIDED that in the event of any Event of Default
specified in Sections 10.1(g) or 10.1(h) hereof, all such amounts shall become
immediately due and payable automatically and without any requirement of notice
from the Agent or any Bank.
SECTION 10.2. TERMINATION OF COMMITMENTS. If any one or more of the
Events of Default specified in Sections 10.1(g) or 10.1(h) hereof shall occur,
any unused portion of the credit hereunder shall forthwith terminate and each of
the Banks shall be relieved of all further obligations to make Revolving Credit
Loans to the Borrower. If any other Event of Default shall have occurred and be
continuing, the Agent may and, upon the request of the Majority Banks, shall, by
notice to the Borrower, terminate the unused portion of the credit hereunder,
and upon such notice being given such unused portion of the credit hereunder
shall terminate immediately and each of the Banks shall be relieved of all
further obligations to make Revolving Credit Loans. No termination of the credit
hereunder shall relieve the Borrower of any of the Obligations.
SECTION 10.3. REMEDIES. In case any one or more of the Events of
Default shall have occurred and be continuing, and whether or not the Banks
shall have accelerated the maturity of the Revolving Credit Loans pursuant to
Section 10.1 hereof, each Bank, if owed any amount with respect to the
Revolving Credit Loans and upon the consent of the Majority Banks, may
proceed to protect and enforce its rights by suit in equity, action at law or
other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Credit Agreement and the other Loan
Documents or any instrument pursuant to which the Obligations to such Bank
are evidenced, including as permitted by applicable law the obtaining of the
EX PARTE appointment of a receiver, and, if such amount shall have become
due, by declaration or otherwise, proceed to enforce the payment thereof or
any other legal or equitable right of such Bank. No remedy herein conferred
upon any Bank or the Agent or the holder of any Revolving Credit Note is
intended to be exclusive of any other remedy and each and every remedy shall
be cumulative and shall be in addition to every other remedy given hereunder
or now or hereafter existing at law or in equity or by statute or any other
provision of law.
SECTION 11. SETOFF. Regardless of the adequacy of any collateral,
during the continuance of any Event of Default, any deposits or other sums
credited by or due from any of the Banks to the Borrower and any securities or
other property
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of the Borrower in the possession of such Bank may be applied to or set off by
such Bank against the payment of Obligations and any and all other liabilities,
direct, or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, of the Borrower to such Bank. Each of the Banks agrees
with each other Bank that (a) if an amount to be set off is to be applied to
Indebtedness of the Borrower to such Bank, other than Indebtedness evidenced by
the Revolving Credit Notes held by such Bank, such amount shall be applied
ratably to such other Indebtedness (except that no amounts shall be applied to
documentary letters of credit) and to the Indebtedness evidenced by all such
Revolving Credit Notes held by such Bank, and (b) if such Bank shall receive
from the Borrower, whether by voluntary payment, exercise of the right of
setoff, counterclaim, cross action, enforcement of the claim evidenced by the
Revolving Credit Notes held by such Bank by proceedings against the Borrower at
law or in equity or by proof thereof in bankruptcy, reorganization, liquidation,
receivership or similar proceedings, or otherwise, and shall retain and apply to
the payment of the Revolving Credit Note or Revolving Credit Notes held by such
Bank any amount in excess of its ratable portion of the payments received by all
of the Banks with respect to the Revolving Credit Notes held by all of the
Banks, such Bank will make such disposition and arrangements with the other
Banks with respect to such excess, either by way of distribution, PRO TANTO
assignment of claims, subrogation or otherwise as shall result in each Bank
receiving in respect of the Revolving Credit Notes held by it, its proportionate
payment as contemplated by this Credit Agreement; PROVIDED that if all or any
part of such excess payment is thereafter recovered from such Bank, such
disposition and arrangements shall be rescinded and the amount restored to the
extent of such recovery, but without interest.
SECTION 12. THE AGENT.
SECTION 12.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of each of
the Banks and to exercise all such powers as are hereunder and under any of the
other Loan Documents and any related documents delegated to the Agent, together
with such powers as are reasonably incident thereto, PROVIDED that no duties or
responsibilities not expressly assumed herein or therein shall be implied to
have been assumed by the Agent.
(b) The relationship between the Agent and the Banks is and shall be
that of an independent contractor. The use of the term "Agent" herein is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the Banks.
Nothing contained in this Agreement or any of the other Loan Documents shall be
construed to create an agency, trust or other fiduciary relationship between the
Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to exercise
certain rights and perform certain duties and responsibilities hereunder and
under the other Loan Documents, the Agent is nevertheless a "representative" of
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the Banks, as that term is defined in Article 1 of the Uniform Commercial Code,
for purposes of actions for the benefit of the Banks with respect to all
collateral security and guaranties contemplated by the Loan Documents. Such
actions include the designation of the Agent as "secured party", "mortgagee",
"lienholder" or the like on all financing statements, motor vehicle titles and
other documents and instruments, whether recorded or otherwise, relating to the
attachment, perfection, priority or enforcement of any security interests,
mortgages, liens or deeds of trust in collateral security intended to secure the
payment or performance of any of the Obligations, all for the benefit of the
Banks and the Agent.
SECTION 12.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers
and execute its duties by or through employees or agents and shall be entitled
to take, and to rely on, advice of counsel concerning all matters pertaining to
its rights and duties under this Credit Agreement and the other Loan Documents.
The Agent may utilize the services of such Persons as the Agent in its sole
discretion may reasonably determine, and all reasonable fees and expenses of any
such Persons shall be paid by the Borrower.
SECTION 12.3. NO LIABILITY. Neither the Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent or employee thereof, shall be liable to the
Banks for any waiver, consent or approval given or any action taken, or omitted
to be taken, in good faith by it or them hereunder or under any of the other
Loan Documents, or in connection herewith or therewith, or be responsible for
the consequences of any oversight or error of judgment whatsoever, except that
the Agent or such other Person, as the case may be, may be liable for losses due
to its willful misconduct or gross negligence.
SECTION 12.4. NO REPRESENTATIONS. The Agent shall not be responsible
for the execution or validity or enforceability of this Credit Agreement, the
Revolving Credit Notes, any of the other Loan Documents or any instrument at any
time constituting, or intended to constitute, collateral security for the
Revolving Credit Notes, or for the value of any such collateral security or for
the validity, enforceability or collectability of any such amounts owing with
respect to the Revolving Credit Notes, or for any recitals or statements,
warranties or representations made herein or in any of the other Loan Documents
or in any certificate or instrument hereafter furnished to it by or on behalf of
the Borrower or any of its Subsidiaries, or be bound to ascertain or inquire as
to the performance or observance of any of the terms, conditions, covenants or
agreements herein or in any instrument at any time constituting, or intended to
constitute, collateral security for the Revolving Credit Notes or to inspect any
of the properties, books or records of the Borrower or any of its Subsidiaries.
The Agent shall not be bound to ascertain whether any notice, consent, waiver or
request delivered to it by the Borrower or any holder of any of the Revolving
Credit Notes shall have been duly authorized or is true, accurate and complete.
The Agent has not made nor does it now make any representations or warranties,
express or implied, nor does it assume any liability to the Banks, with respect
to the creditworthiness or financial conditions of the Borrower or
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any of its Subsidiaries. Each Bank acknowledges that it has, independently and
without reliance upon the Agent or any other Bank, and based upon such
information and documents as it has deemed appropriate, made its own credit
analysis and decision to enter into this Credit Agreement.
SECTION 12.5. PAYMENTS.
SECTION 12.5.1. PAYMENTS TO AGENT. A payment by the
Borrower to the Agent hereunder or any of the other Loan Documents for the
account of any Bank shall constitute a payment to such Bank. The Agent agrees
promptly to distribute to each Bank such Bank's PRO RATA share of payments
received by the Agent for the account of the Banks except as otherwise expressly
provided herein or in any of the other Loan Documents.
SECTION 12.5.2. DISTRIBUTION BY AGENT. If in the opinion
of the Agent the distribution of any amount received by it in such capacity
hereunder, under the Revolving Credit Notes or under any of the other Loan
Documents might involve it in liability, it may refrain from making distribution
until its right to make distribution shall have been adjudicated by a court of
competent jurisdiction. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Agent is to be repaid, each Person to
whom any such distribution shall have been made shall either repay to the Agent
its proportionate share of the amount so adjudged to be repaid or shall pay over
the same in such manner and to such Persons as shall be determined by such
court.
SECTION 12.5.3. DELINQUENT BANKS. Notwithstanding
anything to the contrary contained in this Credit Agreement or any of the other
Loan Documents, any Bank that fails (a) to make available to the Agent its PRO
RATA share of any Revolving Credit Loan or (b) to comply with the provisions of
ss.11 hereof with respect to making dispositions and arrangements with the other
Banks, where such Bank's share of any payment received, whether by setoff or
otherwise, is in excess of its PRO RATA share of such payments due and payable
to all of the Banks, in each case as, when and to the full extent required by
the provisions of this Credit Agreement, shall be deemed delinquent (a
"DELINQUENT BANK") and shall be deemed a Delinquent Bank until such time as such
delinquency is satisfied. A Delinquent Bank shall be deemed to have assigned any
and all payments due to it from the Borrower, whether on account of outstanding
Revolving Credit Loans, interest, fees or otherwise, to the remaining
nondelinquent Banks for application to, and reduction of, their respective PRO
RATA shares of all outstanding Revolving Credit Loans. The Delinquent Bank
hereby authorizes the Agent to distribute such payments to the nondelinquent
Banks in proportion to their respective PRO RATA shares of all outstanding
Revolving Credit Loans. A Delinquent Bank shall be deemed to have satisfied in
full a delinquency when and if, as a result of application of the assigned
payments to all outstanding Revolving Credit Loans of the nondelinquent Banks,
the Banks' respective PRO RATA shares of all outstanding Revolving Credit Loans
have returned to those in effect immediately prior to
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such delinquency and without giving effect to the nonpayment causing such
delinquency.
SECTION 12.6. HOLDERS OF REVOLVING CREDIT NOTES. The Agent may deem and
treat the payee of any Revolving Credit Note as the absolute owner or purchaser
thereof for all purposes hereof until it shall have been furnished in writing
with a different name by such payee or by a subsequent holder, assignee or
transferee.
SECTION 12.7. INDEMNITY. The Banks ratably agree hereby to indemnify
and hold harmless the Agent from and against any and all claims, actions and
suits (whether groundless or otherwise), losses, damages, costs, expenses
(including any expenses for which the Agent has not been reimbursed by the
Borrower as required by Section 14 hereof), and liabilities of every nature and
character arising out of or related to this Credit Agreement, the Revolving
Credit Notes or any of the other Loan Documents or the transactions contemplated
or evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly caused
by the Agent's willful misconduct or gross negligence.
SECTION 12.8. AGENT AS BANK; ETC. In its individual capacity, Fleet
shall have the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Revolving Credit Loans made by it, and as the
holder of any of the Revolving Credit Notes, as it would have were it not also
the Agent.
SECTION 12.9. RESIGNATION. The Agent may resign at any time by giving
sixty (60) days' prior written notice thereof to the Banks and the Borrower.
Upon any such resignation, the Majority Banks shall have the right to appoint a
successor Agent. Unless a Default or Event of Default shall have occurred and be
continuing, such successor Agent shall be reasonably acceptable to the Borrower.
If no successor Agent shall have been so appointed by the Majority Banks and
shall have accepted such appointment within thirty (30) days after the retiring
Agent's giving of notice of resignation, then the retiring Agent may, on behalf
of the Banks, appoint a successor Agent reasonably acceptable to the Borrower,
which shall be a financial institution having a rating of not less than A or its
equivalent by S&P. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the provisions of this Credit
Agreement and the other Loan Documents shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was acting
as Agent.
SECTION 12.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each
Bank hereby agrees that, upon learning of the existence of a Default or an Event
of Default, it shall promptly notify the Agent thereof. The Agent hereby agrees
that upon receipt of any notice under this Section 12.10 it shall promptly
notify the
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other Banks and the Borrower of the existence of such Default or Event of
Default.
SECTION 13. EXPENSES. The Borrower agrees to pay (a) the Agent's
reasonable costs of producing and reproducing this Credit Agreement, the other
Loan Documents and the other agreements and instruments mentioned herein, (b)
any taxes (including any interest and penalties in respect thereto) payable by
the Agent or any of the Banks (other than taxes based upon the Agent's or any
Bank's net income or taxes not payable by the Borrower pursuant to the
provisions of this Credit Agreement) on the transactions contemplated by this
Credit Agreement (the Borrower hereby agreeing to indemnify the Agent and each
Bank with respect thereto), (c) the reasonable fees, expenses and disbursements
of the Agent's Special Counsel or any local counsel to the Agent incurred in
connection with the preparation, administration or interpretation of the Loan
Documents and other instruments mentioned herein, each closing hereunder, and
amendments, modifications, approvals, consents or waivers hereto or hereunder,
(d) the reasonable fees, expenses and disbursements of the Agent incurred by the
Agent in connection with the preparation, administration or interpretation of
the Loan Documents and other instruments mentioned herein, including all
insurance premiums and surveyor, engineering and appraisal charges, (e) all
reasonable out-of-pocket expenses (including, without limitation, reasonable
attorneys' fees (including the allocated costs of in-house counsel) and costs
and reasonable accounting, appraisal, investment banking and similar
professional fees and charges) incurred by the Agent or any Bank in connection
with (i) the enforcement of or preservation of rights under any of the Loan
Documents against the Borrower or any of its Subsidiaries or the administration
thereof after the occurrence of an Event of Default and (ii) any other
litigation, proceeding or dispute whether arising hereunder or otherwise, in any
way related to any Bank's or the Agent's relationship with the Borrower or any
of its Subsidiaries (other than any litigation, proceeding or dispute referred
to in ss.14 hereof) but only if such Bank or the Agent is the prevailing party
in such litigation, proceeding or dispute, and (f) all reasonable fees, expenses
and disbursements of the Agent incurred in connection with UCC searches. The
Borrower shall not pay the fees, expenses and disbursements incurred by any Bank
other than the Agent in connection with the review and preparation of this
Credit Agreement, the other Loan Documents and the other agreements and
instruments mentioned herein. The covenants of this ss.13 shall survive payment
or satisfaction of all other Obligations.
SECTION 14. INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Agent, the Arranger and the Banks from and against any and all
claims, actions and suits whether groundless or otherwise, and from and against
any and all liabilities, losses, damages and expenses of every nature and
character arising out of this Credit Agreement or any of the other Loan
Documents or the transactions contemplated hereby including, without limitation,
(a) any actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Revolving Credit Loans, (b) the Borrower or any of its
Subsidiaries entering into or performing this Credit Agreement or any of the
other Loan Documents or (c) with respect to the
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Borrower and its Subsidiaries and their respective properties and assets, the
violation of any Environmental Law, the presence, disposal, escape, seepage,
leakage, spillage, discharge, emission, release or threatened release of any
Hazardous Substances or any action, suit, proceeding or investigation brought or
threatened with respect to any Hazardous Substances (including, but not limited
to, claims with respect to wrongful death, personal injury or damage to
property), in each case including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding. In litigation, or the preparation therefor, the
Banks, the Arranger and the Agent shall be entitled to select their own counsel
and, in addition to the foregoing indemnity, the Borrower agrees to pay promptly
the reasonable fees and expenses of such counsel. If, and to the extent that the
obligations of the Borrower under this Section 14 are unenforceable for any
reason, the Borrower hereby agrees to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law. The covenants contained in this Section 14 shall survive payment
or satisfaction in full of all other Obligations.
SECTION 15. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Revolving Credit Notes, in
any of the other Loan Documents or in any documents or other papers delivered by
or on behalf of the Borrower or any of its Subsidiaries pursuant hereto shall be
deemed to have been relied upon by the Banks and the Agent, notwithstanding any
investigation heretofore or hereafter made by any of them, and shall survive the
making by the Banks of any of the Revolving Credit Loans or the issuance of any
Letters of Credit, as herein contemplated, and shall continue in full force and
effect so long as any amount due under this Credit Agreement or the Revolving
Credit Notes or the other Loan Documents remains outstanding or any Bank has any
obligation to make any Revolving Credit Loans, and for such further time as may
be otherwise expressly specified in this Credit Agreement. All statements
contained in any certificate or other paper delivered to any Bank or the Agent
at any time by or on behalf of the Borrower or any of its Subsidiaries pursuant
hereto or in connection with the transactions contemplated hereby shall
constitute representations and warranties by the Borrower or such Subsidiary
hereunder.
SECTION 16. ASSIGNMENT AND PARTICIPATION.
SECTION 16.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided
herein, each Bank may assign to one or more Eligible Assignees all or a portion
of its interests, rights and obligations under this Credit Agreement (including
all or a portion of its Commitment Percentage and Commitment and the same
portion of the Revolving Credit Loans at the time owing to it and the Revolving
Credit Notes held by it); PROVIDED that (a) each of the Agent and the Borrower
shall have given its prior written consent to such assignment, which consent, in
each case, will not be unreasonably withheld, (b) each such assignment shall be
of a constant, and not a varying, percentage of all the assigning Bank's rights
and obligations under this Credit Agreement, (c) each assignment shall be in an
amount that is a minimum of $5,000,000 or an integral multiple of $500,000 in
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excess thereof, unless such assignment is to an existing Bank, in which case
there shall be no such minimum amount, and (d) the parties to such assignment
shall execute and deliver to the Agent, for recording in the Register (as
hereinafter defined), an Assignment and Acceptance, substantially in the form of
EXHIBIT D attached hereto (an "ASSIGNMENT AND ACCEPTANCE"), together with any
Revolving Credit Notes subject to such assignment. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
(5) Business Days after the execution thereof, (i) the assignee thereunder shall
be a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Bank hereunder, and (ii) the assigning Bank
shall, to the extent provided in such assignment and upon payment to the Agent
of the registration fee referred to in Section 16.3 hereof, be released from its
obligations under this Credit Agreement.
SECTION 16.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS;
COVENANTS. By executing and delivering an Assignment and Acceptance, the parties
to the assignment thereunder confirm to and agree with each other and the other
parties hereto as follows: (a) other than the representation and warranty that
it is the legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no representation or
warranty, express or implied, and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or mortgage; (b) the
assigning Bank makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower and its Subsidiaries or
any other Person primarily or secondarily liable in respect of any of the
Obligations, or the performance or observance by the Borrower and its
Subsidiaries or any other Person primarily or secondarily liable in respect of
any of the Obligations of any of their obligations under this Credit Agreement
or any of the other Loan Documents or any other instrument or document furnished
pursuant hereto or thereto; (c) such assignee confirms that it has received a
copy of this Credit Agreement, together with copies of the most recent financial
statements referred to in Sections 4.4 and 5.4 hereof and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (d) such assignee will,
independently and without reliance upon the assigning Bank, the Agent or any
other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Credit Agreement; (e) such assignee represents and
warrants that it is an Eligible Assignee; (f) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Credit Agreement and the other Loan Documents as are
delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto; (g) such assignee agrees that it will
perform in accordance
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with their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Bank; and (h) such assignee
represents and warrants that it is legally authorized to enter into such
Assignment and Acceptance.
SECTION 16.3. REGISTER. The Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register or similar list (the
"REGISTER") for the recordation of the names and addresses of the Banks and the
Commitment Percentage of, and principal amount of the Revolving Credit Loans
owing to the Banks from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the Agent and
the Banks may treat each Person whose name is recorded in the Register as a Bank
hereunder for all purposes of this Credit Agreement. The Register shall be
available for inspection by the Borrower and the Banks at any reasonable time
and from time to time upon reasonable prior notice. Upon each such recordation,
other than with respect to assignments by any Bank to (a) any Affiliate of such
Bank, (b) any of the twelve (12) Federal Reserve Banks as provided in Section
16.8 hereof or (c) any other Bank hereunder, the assigning Bank agrees to pay to
the Agent a registration fee in the sum of $2,500.
SECTION 16.4. NEW REVOLVING CREDIT NOTES. Upon its receipt of an
Assignment and Acceptance executed by the parties to such assignment, together
with each Note subject to such assignment, the Agent shall (a) record the
information contained therein in the Register, and (b) give prompt notice
thereof to the Borrower and the Banks (other than the assigning Bank). Within
five (5) Business Days after receipt of such notice, the Borrower, at its own
expense, shall execute and deliver to the Agent, in exchange for each
surrendered Revolving Credit Note, a new Revolving Credit Note to the order of
such Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Acceptance and, if the assigning Bank
has retained some portion of its obligations hereunder, a new Revolving Credit
Note to the order of the assigning Bank in an amount equal to the amount
retained by it hereunder. Such new Revolving Credit Notes shall provide that
they are replacements for the surrendered Revolving Credit Notes, shall be in an
aggregate principal amount equal to the aggregate principal amount of the
surrendered Revolving Credit Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be substantially the form of the
assigned Revolving Credit Notes. The surrendered Revolving Credit Notes shall be
canceled and returned to the Borrower.
SECTION 16.5. PARTICIPATIONS. Each Bank may sell participations to one
or more banks or other entities in all or a portion of such Bank's rights and
obligations under this Credit Agreement and the other Loan Documents; PROVIDED
that (a) each such participation shall be in an amount of not less than
$5,000,000, (b) any such sale or participation shall not affect the rights and
duties of the selling Bank hereunder to the Borrower and (c) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve waivers, amendments or modifications that would (i)
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reduce the principal of or the interest rate on any Revolving Credit Loans, (ii)
extend the term or increase the amount of the Commitment of such Bank as it
relates to such participant, (iii) reduce the amount of any Facility Fees to
which such participant is entitled, (iv) extend any regularly scheduled payment
date for principal or interest or (v) release any collateral for the
Obligations.
SECTION 16.6. DISCLOSURE. The Borrower agrees that in addition to
disclosures made in accordance with standard and customary banking practices any
Bank may disclose information obtained by such Bank pursuant to this Credit
Agreement to assignees or participants and with the written consent of the
Borrower, such consent not to be unreasonably withheld, potential assignees or
participants hereunder; PROVIDED that such assignees or participants or
potential assignees or participants shall agree (a) to treat in confidence such
information unless such information otherwise becomes public knowledge, (b) not
to disclose such information to a third party, except as required by law or
legal process, (c) not to make use of such information for purposes of
transactions unrelated to such contemplated assignment or participation and (d)
to enter into a confidentiality agreement with the Borrower evidencing the
foregoing.
SECTION 16.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If
any assignee Bank is an Affiliate of the Borrower, then any such assignee Bank
shall have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Agent pursuant to Sections 10.1 or 10.2
hereof, and the determination of the Majority Banks shall for all purposes of
this Credit Agreement and the other Loan Documents be made without regard to
such assignee Bank's interest in any of the Revolving Credit Loans. If any Bank
sells a participating interest in any of the Revolving Credit Loans to a
participant, and such participant is the Borrower or an Affiliate of the
Borrower, then such transferor Bank shall promptly notify the Agent of the sale
of such participation. A transferor Bank shall have no right to vote as a Bank
hereunder or under any of the other Loan Documents for purposes of granting
consents or waivers or for purposes of agreeing to amendments or modifications
to any of the Loan Documents or for purposes of making requests to the Agent
pursuant to Sections 10.1 or 10.2 hereof to the extent that such participation
is beneficially owned by the Borrower or any Affiliate of the Borrower, and the
determination of the Majority Banks shall for all purposes of this Credit
Agreement and the other Loan Documents be made without regard to the interest of
such transferor Bank in the Revolving Credit Loans to the extent of such
participation.
SECTION 16.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank
shall retain its rights to be indemnified pursuant to Section 14 hereof with
respect to any claims or actions arising prior to the date of such assignment.
If any assignee Bank is not incorporated under the laws of the United States of
America or any state thereof, it shall, prior to the date on which any interest
or fees are payable hereunder or under any of the other Loan Documents for its
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account, deliver to the Borrower and the Agent certification as to its exemption
from deduction or withholding of any United States federal income taxes.
Anything contained in this Section 16 to the contrary notwithstanding, any Bank
may at any time pledge all or any portion of its interest and rights under this
Credit Agreement (including all or any portion of its Revolving Credit Notes) to
any of the twelve Federal Reserve Banks organized under Section 4 of the Federal
Reserve Act, 12 U.S.C. Section 341 and may at any time assign all or any portion
of its interest and rights under this Credit Agreement (including all or any
portion of its Revolving Credit Notes) to any Affiliate of such Bank (provided
that such assignment to such Affiliate does not impose any additional tax
liabilities on the Borrower), in each case without payment to the Agent of the
registration fee as provided in Section 16.3 hereof. No such pledge or
assignment or the enforcement thereof shall release the Pledgor or Assignor Bank
from its obligations hereunder or under any of the other Loan Documents.
SECTION 16.9. ASSIGNMENT BY BORROWER. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Banks.
SECTION 17. NOTICES, ETC. Except as otherwise expressly provided in
this Credit Agreement, all notices and other communications made or required by
this Credit Agreement or the Revolving Credit Notes shall be in writing and
shall be delivered in hand, mailed by United States registered or certified
first class mail, postage prepaid, sent by overnight courier, or sent by
telegraph, telecopy, facsimile or telex and confirmed by delivery via courier or
postal service, addressed as follows:
(a) if to the Borrower, at 500 Staples Drive, Framingham,
MA 01701, Attention: Mr. William Swanson, or at such other address for notice as
the Borrower shall last have furnished in writing to the Person giving the
notice, with a copy to Jack A. VanWoerkom, Esq., Senior Vice President and
General Counsel, Staples, Inc., 500 Staples Drive, Framingham, MA 01701;
(b) if to the Agent, at 100 Federal Street, Boston,
Massachusetts 02110, USA, Attention: Susan Pardus-Galland, Director, or such
other address for notice as the Agent shall last have furnished in writing to
the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on
SCHEDULE 1 hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer and (ii) if sent by registered or
certified first-class mail return receipt requested, postage prepaid, on the
third Business Day following the mailing thereof.
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SECTION 18. GOVERNING LAW. THIS CREDIT AGREEMENT AND, EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE
CONTRACTS UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL
PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID
COMMONWEALTH (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH
OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING IN SUCH STATE AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 17
HEREOF. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS
BROUGHT IN AN INCONVENIENT COURT.
SECTION 19. HEADINGS. The captions in this Credit Agreement are for
convenience of reference only and shalL not define or limit the provisions
hereof.
SECTION 20. COUNTERPARTS. This Credit Agreement and any amendment
hereof may be executed in severaL counterparts and by each party on a separate
counterpart, each of which when executed and delivered shall be an original, and
all of which together shall constitute one instrument. In proving this Credit
Agreement it shall not be necessary to produce or account for more than one such
counterpart signed by the party against whom enforcement is sought.
SECTION 21. ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions contemplated
hereby. Neither this Credit Agreement nor any term hereof may be changed,
waived, discharged or terminated, except as provided in Section 23 hereof.
SECTION 22. WAIVER OF JURY TRIAL. The Borrower hereby waives its right
to a jury trial with respect to anY action or claim arising out of any dispute
in connection with this Credit Agreement, the Revolving Credit Notes or any of
the other Loan Documents, any rights or obligations hereunder or thereunder or
the performance of which rights and obligations. Except as prohibited by law,
the Borrower hereby waives any right it may have to claim or recover in any
litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. The Borrower (a) certifies that no representative, agent or
attorney of any Bank or the Agent has represented, expressly or otherwise, that
such Bank or the Agent would not, in the event of litigation, seek to enforce
the foregoing waivers and (b) acknowledges that the Agent and the Banks have
been induced to enter into this Credit Agreement, the other Loan Documents to
which it is a party by, among other things, the waivers and certifications
contained herein.
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SECTION 23. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or approval
required or permitted by this CrediT Agreement to be given by the Banks may be
given, and any term of this Credit Agreement, the other Loan Documents or any
other instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower or any of its Subsidiaries of any
terms of this Credit Agreement, the other Loan Documents or such other
instrument or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Majority Banks. Notwithstanding the foregoing, the rate
of interest on the Revolving Credit Notes, the term of the Revolving Credit
Notes, the regularly scheduled payment date for principal or interest on the
Revolving Credit Notes, the Commitment Amounts of the Banks, and the scheduled
payment date for and the amount of any Facility Fees hereunder, may not be
changed without the written consent of the Borrower and the written consent of
each Bank affected thereby; the principal amount of any Revolving Credit Loans
may not be forgiven without the written consent of each Bank affected thereby;
this Section 23 may not be changed without the written consent of the Borrower
and the written consent of all of the Banks; the definition of Majority Banks
may not be amended without the written consent of all of the Banks; the Agent
may not release any guaranty for the Obligations (except as provided in Section
3.13 hereof) without the written consent of all the Banks; and the amount of the
Agent Fees payable for the account of the Agent and Section 12 hereof may not be
amended withouT the written consent of the Agent. No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Agent or
any Bank in exercising any right shall operate as a waiver thereof or otherwise
be prejudicial thereto. No notice to or demand upon the Borrower shall entitle
the Borrower to other or further notice or demand in similar or other
circumstances.
SECTION 24. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
SECTION 24.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY. The
Borrower, for itself and each of itS Subsidiaries, in connection with any
financial advisory or investment banking services provided from time to time by
a Section 20 Subsidiary to the Borrower or one or more of its Subsidiaries,
hereby authorizes (a) such Section 20 Subsidiary to share with the Agent and
each Bank any information delivered to such Section 20 Subsidiary by the
Borrower or any of its Subsidiaries, and (b) the Agent and each Bank to share
with such Section 20 Subsidiary any information delivered to the Agent or such
Bank by the Borrower or any of its Subsidiaries pursuant to this Credit
Agreement, or in connection with the decision of such Bank to enter into this
Credit Agreement; it being understood, in each case, that any such Section 20
Subsidiary receiving such information shall be bound by the confidentiality
provisions of this Credit Agreement. Such authorization shall survive the
payment and satisfaction in full of all of Obligations.
<PAGE>
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SECTION 24.2. CONFIDENTIALITY. Each of the Banks and the Agent agrees,
on behalf of itself and each of itS affiliates, directors, officers, employees
and representatives, to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Borrower or any of its Subsidiaries
pursuant to this Credit Agreement that is identified by such Person as being
confidential at the time the same is delivered to the Banks or the Agent,
provided that nothing herein shall limit the disclosure of any such information
(a) after such information shall have become public other than through a
violation of this Section 24, (b) to the extent required by statute, rule,
regulation or judicial process, (c) to counsel for any of the Banks or the
Agent, (d) to bank examiners or any other regulatory authority having
jurisdiction over any Bank or the Agent, or to auditors or accountants, (e) to
the Agent, any Bank or, subject to Section 24.1, any Section 20 Subsidiary, (f)
in connection with any litigation to which any one or more of the Banks, the
Agent or any Section 20 Subsidiary is a party, or in connection with the
enforcement of rights or remedies hereunder or under any other Loan Document,
(g) to a Subsidiary or affiliate of such Bank as provided in Section 16 or (h)
to any assignee or participant (or prospective assignee or participant) so long
as such assignee or participant agrees to be bound by the provisions of Section
16.6.
SECTION 24.3. PRIOR NOTIFICATION. Unless specifically prohibited by
applicable law or court order, each oF the Banks and the Agent shall, prior to
disclosure thereof, notify the Borrower of any request for disclosure of any
such non-public information by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of such Bank by such governmental agency) or pursuant to legal
process.
SECTION 24.4. OTHER. In no event shall any Bank or the Agent be
obligated or required to return any materials furnished to it or any Section 20
Subsidiary by the Borrower or any of its Subsidiaries. The obligations of each
Bank under this Section 24 shall supersede and replace the obligations of such
Bank under any confidentiality letter in respect of this financing signed and
delivered by such Bank to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any interest
in any of the Revolving Credit Loans from any Bank.
SECTION 25. SEVERABILITY. The provisions of this Credit Agreement are
severable and if any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Credit
Agreement in any jurisdiction.
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IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
STAPLES, INC.
By:________________________________
Title:
FLEET NATIONAL BANK, individually
and as Agent
By:________________________________
Susan L. Pardus-Galland, Director
ABN AMRO BANK N.V.
By:________________________________
Title:
BANK OF AMERICA, N.A.
By:________________________________
Title:
THE BANK OF NOVA SCOTIA
By:________________________________
Title:
<PAGE>
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CITICORP USA, INC.
By:________________________________
Title:
BANK ONE, NA
By:________________________________
Title:
FIRST UNION NATIONAL BANK
By:________________________________
Title:
FIRSTAR FINANCIAL SERVICES, INC.
By:________________________________
Title:
HSBC BANK USA
By:________________________________
Title:
MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By:________________________________
Title:
<PAGE>
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UNION BANK OF CALIFORNIA, N.A.
By:________________________________
Title:
KBC BANK NV
By:________________________________
Title:
