SECOND QUARTER 1997
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the Quarterly Period Ended June 30, 1997
Commission File Number 1-9608
NEWELL CO.
(Exact name of registrant as specified in its charter)
DELAWARE 36-3514169
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Newell Center
29 East Stephenson Street
Freeport, Illinois 61032-0943
(Address of principal executive offices)
(Zip Code)
(815)235-4171
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
------- -------
Number of shares of Common Stock outstanding
as of July 22, 1997: 159,096,710
<PAGE> 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
--------------------
<TABLE> NEWELL CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- -------------------
1997 1996 1997 1996
-------------------- -------------------
(In thousands, except per share data)
<S> <C> <C> <C> <C>
Net sales $ 800,962 $ 735,168 $1,430,336 $1,353,325
Cost of products sold 535,147 499,282 975,237 936,189
-------- -------- --------- ---------
GROSS INCOME 265,815 235,886 455,099 417,136
Selling, general and
administrative expenses 117,971 107,437 227,929 219,191
-------- -------- --------- ---------
OPERATING INCOME 147,844 128,449 227,170 197,945
Nonoperating expenses (income):
Interest expense 15,320 14,476 28,105 28,918
Other 3,659 1,067 7,679 805
-------- -------- --------- ---------
Net nonoperating expenses (income) 18,979 15,543 35,784 29,723
-------- -------- --------- ---------
INCOME BEFORE INCOME TAXES 128,865 112,906 191,386 168,222
Income taxes 51,031 45,213 75,789 67,339
-------- -------- --------- ---------
NET INCOME $ 77,834 $ 67,693 $ 115,597 $ 100,883
======== ======== ========= =========
Earnings per share $ 0.49 $ 0.43 $ 0.73 $ 0.64
======== ======== ========= =========
Dividends per share $ 0.16 $ 0.14 $ 0.32 $ 0.28
======== ======== ========= =========
Weighted average shares outstanding 159,070 158,750 159,014 158,713
======== ======== ========= =========
See notes to consolidated financial statements.
</TABLE>
<PAGE> 3
<TABLE>
NEWELL CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, % of December 31, % of
1997 Total 1996 Total
------------- ----- ------------- -----
Unaudited
ASSETS
CURRENT ASSETS
<S> <C> <C> <C> <C>
Cash and cash equivalents $ 22,709 0.6% $ 4,360 0.1%
Accounts receivable, net 563,458 14.4 404,170 13.4
Inventories, net 648,942 16.5 509,504 17.0
Deferred income taxes 103,245 2.6 121,152 4.0
Prepaid expenses and other 77,744 2.0 68,928 2.3
--------- ----- --------- -----
TOTAL CURRENT ASSETS 1,416,098 36.1 1,108,114 36.8
MARKETABLE EQUITY SECURITIES 297,610 7.6 240,789 8.0
OTHER LONG-TERM INVESTMENTS 46,867 1.2 58,703 2.0
OTHER ASSETS 125,325 3.2 119,168 4.0
PROPERTY, PLANT AND EQUIPMENT, NET 668,428 17.0 555,434 18.5
TRADE NAMES AND GOODWILL 1,370,672 34.9 922,846 30.7
--------- ----- --------- -----
TOTAL ASSETS $3,925,000 100.0% $3,005,054 100.0%
========= ===== ========= =====
See notes to consolidated financial statements.
</TABLE>
<PAGE> 4
<TABLE>
NEWELL CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (CONT.)
(In thousands)
June 30, % of December 31, % of
1997 Total 1996 Total
------------- ----- ------------- -----
Unaudited
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
<S> <C> <C> <C> <C>
Notes payable $ 304,034 7.8% $ 70,877 2.4%
Accounts payable 138,768 3.5 105,333 3.5
Accrued compensation 62,611 1.6 65,632 2.2
Other accrued liabilities 408,812 10.4 324,719 10.8
Income taxes 12,934 0.3 37,209 1.2
Current portion of long-term debt 16,415 0.4 33,243 1.1
--------- ----- --------- -----
TOTAL CURRENT LIABILITIES 943,574 24.0 637,013 21.2
LONG-TERM DEBT 1,116,583 28.5 672,033 22.4
OTHER NONCURRENT LIABILITIES 191,610 4.9 156,691 5.2
DEFERRED INCOME TAXES 72,306 1.8 47,477 1.6
MINORITY INTEREST 15,080 0.4 - -
STOCKHOLDERS' EQUITY
Common stock - authorized shares,
400.0 million at $1 par value; 159,094 4.1 158,871 5.3
Outstanding shares:
1997 - 159.1 million
1996 - 158.9 million
Additional paid-in capital 201,021 5.1 197,889 6.6
Retained earnings 1,170,864 29.8 1,106,146 36.8
Net unrealized gain on securities
available for sale 70,957 1.8 36,595 1.2
Cumulative translation adjustment (16,089) (0.4) (7,661) (0.3)
--------- ----- --------- -----
TOTAL STOCKHOLDERS' EQUITY 1,585,847 40.4 1,491,840 49.6
--------- ----- --------- -----
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $3,925,000 100.0% $3,005,054 100.0%
========= ===== ========= =====
See notes to consolidated financial statements.
</TABLE>
<PAGE> 5
<TABLE>
NEWELL CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
For the Six Months Ended
June 30,
--------------------------
1997 1996
---------- ----------
Unaudited (In thousands)
OPERATING ACTIVITIES:
<S> <C> <C>
Net Income $ 115,597 $ 100,883
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Depreciation and amortization 60,927 58,392
Deferred income taxes 18,532 35,947
Investment write-off - 1,339
Other (2,504) (3,609)
Changes in Current Accounts, excluding the
effects of acquisitions:
Accounts receivable (61,445) (56,403)
Inventories (31,150) (3,207)
Other current assets 3,022 1,141
Accounts payable (8,033) (1,026)
Accrued liabilities and other (57,128) (46,049)
------- -------
NET CASH PROVIDED BY OPERATING ACTIVITIES 37,818 87,408
------- -------
INVESTING ACTIVITIES:
Acquisitions, net (570,096) (35,419)
Expenditures for property, plant and equipment (24,546) (29,332)
Disposals of noncurrent assets and other (7,664) (1,565)
------- -------
NET CASH USED IN INVESTING ACTIVITIES (602,306) (66,316)
------- -------
FINANCING ACTIVITIES:
Proceeds from issuance of debt 708,033 129,850
Proceeds from exercised stock options and other 3,355 2,654
Payments on notes payable and long-term debt (69,244) (114,479)
Cash dividends (50,879) (44,437)
-------- -------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 591,265 (26,412)
-------- -------
EXCHANGE RATE EFFECT ON CASH (8,428) (7,961)
------- -------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 18,349 (13,281)
Cash and cash equivalents at beginning of year 4,360 58,771
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 22,709 $ 45,490
======== ========
Supplemental cash flow disclosures:
Cash paid during the period for -
Income taxes $ 58,064 $ 40,216
Interest 28,712 25,380
See notes to consolidated financial statements.
</TABLE>
<PAGE> 6
NEWELL CO. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - The condensed financial statements included herein have
been prepared by the Company, without audit, pursuant to
the rules and regulations of the Securities and Exchange
Commission, and reflect all adjustments necessary to
present a fair statement of the results for the periods
reported, subject to normal recurring year-end audit
adjustments, none of which is material. Certain
information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations, although
the Company believes that the disclosures are adequate to
make the information presented not misleading. It is
suggested that these condensed financial statements be
read in conjunction with the financial statements and the
notes thereto included in the Company's latest Annual
Report on Form 10-K.
Note 2 - On January 19, 1996, the Company acquired The Holson
Burnes Group, Inc. ("Holson Burnes"), a manufacturer and
marketer of photo albums and picture frames. On March 5,
1997, the Company purchased the Rolodex business unit of
Insilco Corporation ("Rolodex"), a marketer of office
products including card files, personal organizers and
paper punches. On May 30, 1997, the Company acquired the
Kirsch business ("Kirsch") of Cooper Industries, Inc., a
manufacturer and distributor of drapery hardware and
custom window coverings in the United States and
internationally. On June 13, 1997, the Company acquired
the Office Products business of Rubbermaid Incorporated, a
designer, manufacturer and supplier of computer and desk
accessories, resin-based office furniture and
storage/organization products. For these and other minor
acquisitions, the Company paid $638.5 million in cash and
assumed $61.9 million of debt. The transactions were
accounted for as purchases; therefore, results of
operations are included in the accompanying consolidated
financial statements since their respective dates of
acquisition. The acquisition costs were allocated on a
preliminary basis to the fair market value of the assets
acquired and liabilities assumed and resulted in trade
names and goodwill of approximately $513.9 million. The
final adjustments to the purchase price allocations are
not expected to be material to the financial statements.
The unaudited consolidated results of operations for the
six months ended June 30, 1997 and 1996 on a pro forma
basis, as though Holson Burnes, Rolodex, Kirsch and
Rubbermaid had been acquired on January 1, 1996, are as
follows:
<TABLE>
Six Months Ended June 30,
1997 1996
------ ------
(In millions, except per share amounts)
<S> <C> <C>
Net sales $1,648.7 $1,646.0
Net income 110.5 98.0
Earnings per share 0.70 0.62
</TABLE>
<PAGE> 7
Note 3- The components of inventories at the end of each period,
net of the LIFO reserve, were as follows:
<TABLE>
June 30, December 31,
1997 1996
------------ --------------
(In millions)
<S> <C> <C>
Materials and supplies $150.7 $124.5
Work in process 121.1 87.9
Finished products 377.1 297.1
------ -----
$648.9 $509.5
===== =====
</TABLE>
Note 4 - Long-term Marketable Equity Securities classified as
available for sale are carried at fair value with
adjustments to fair value reported separately, net of tax,
as a component of stockholders' equity (and excluded from
earnings). Long-term Marketable Equity Securities at the
end of each period are summarized as follows:
<TABLE>
June 30, December 31,
1997 1996
---------- ------------
(In millions)
<S> <C> <C>
Aggregate market value $297.6 $240.8
Aggregate cost 180.3 180.3
----- -----
Unrealized gain $117.3 $ 60.5
===== ====
</TABLE>
Note 5 - Property, plant and equipment at the end of each period
consisted of the following:
<TABLE>
June 30, December 31,
1997 1996
------------ -------------
(In millions)
<S> <C> <C>
Land $ 28.7 $ 21.1
Buildings and improvements 251.0 206.9
Machinery and equipment 762.4 699.6
1,042.1 927.6
Allowance for depreciation (373.7) (372.2)
$ 668.4 $ 555.4
===== ======
</TABLE>
Note 6 - Commercial paper in the amount of $846.0 million at June
30, 1997 is classified as long-term since it is supported
by the 5-year $900.0 million revolving credit agreement.
Long-term debt at the end of each period consisted of the
following:
<TABLE>
June 30, December 31,
1997 1996
------------- ------------
(In millions)
<S> <C> <C>
Medium-term notes $ 263.0 $ 295.0
Commercial paper 846.0 404.0
Other long-term debt 24.0 6.2
------- ------
1,133.0 705.2
Current portion (16.4) (33.2)
------- ------
$1,116.6 $672.0
======= =====
</TABLE>
<PAGE> 8
Note 7 - Minority Interest represents the minority stockholders'
proportionate share of the equity of Acrimo. The Company
acquired a controlling interest in Acrimo on May 30, 1997
as a result of the acquisition of Kirsch, which held a
controlling interest in Acrimo. At June 30, 1997, the
Company held approximately 54% of the capital stock of
Acrimo. Acrimo is one of Europe's leading manufacturers
of drapery hardware and markets a wide range of window
furnishing products including curtain rods, roller blinds
and venetian blinds.
The Company recorded the operating results of Acrimo since
May 30, 1997. The minority stockholders' proportionate
share in Acrimo's net income after May 30, 1997 is
included in Other Expense in the 1997 Consolidated
Statements of Income for the three months and six months
ended June 30, 1997.
Note 8 - The Company has only limited involvement with derivative
financial instruments and does not use them for trading
purposes. They are used to manage certain interest rate
and foreign currency risks.
Interest rate swap agreements are utilized to convert
certain floating rate debt instruments into fixed rate
debt. Premiums paid related to interest rate swap
agreements are amortized into interest expense over the
terms of the agreements. As of June 30, 1997, the Company
did not have any interest rate swaps outstanding.
The Company uses forward exchange contracts to hedge
certain purchase commitments denominated in currencies
other than the domestic currency. Unamortized premiums
are included in other assets in the consolidated balance
sheets. Gains and losses relating to qualifying hedges of
firm commitments are deferred and are recognized in income
as adjustments of carrying amounts when the hedged
transaction occurs.
The Company does not obtain collateral or other security
to support financial instruments subject to credit risk
but monitors the credit standing of the counterparties.
Note 9 - In 1997, the Financial Accounting Standards Board issued
Statement 128, "Earnings per Share." This statement
establishes a new standard for computing and presenting
earnings per share in financial statements. The Company
will adopt the new standard when it releases its fourth
quarter 1997 earnings; the impact of adoption of this
statement will not be material to the Companys results of
operations.
<PAGE> 9
PART I. Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
---------------------------------------------
<TABLE>
Results of Operations
---------------------
The following table sets forth for the periods indicated items from the Consolidated Statements of Income as a
percentage of net sales.
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- -------------------
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of products sold 66.8 67.9 68.2 69.2
----- ----- ----- -----
GROSS INCOME 33.2 32.1 31.8 30.8
Selling, general and
administrative expenses 14.7 14.6 15.9 16.2
----- ----- ----- -----
OPERATING INCOME 18.5 17.5 15.9 14.6
Nonoperating expenses (income):
Interest expense 1.9 2.0 2.0 2.1
Other 0.5 0.1 0.5 0.1
----- ----- ----- ------
Net nonoperating expenses (income) 2.4 2.1 2.5 2.2
----- ----- ----- -----
INCOME BEFORE INCOME TAXES 16.1 15.4 13.4 12.4
Income taxes 6.4 6.2 5.3 4.9
----- ----- ------ -----
NET INCOME 9.7% 9.2% 8.1% 7.5%
===== ===== ===== =====
</TABLE>
<PAGE> 10
THREE MONTHS ENDED JUNE 30, 1997 VS. THREE MONTHS ENDED JUNE 30,
1996
Net sales for the second quarter of 1997 were $800.9 million,
representing an increase of $65.8 million or 9.0% from $735.1
million in the comparable quarter of 1996. The overall increase in
net sales was primarily attributable to contributions from Rolodex
(acquired in March 1997), Kirsch (acquired in May 1997),
Rubbermaid's office products business (acquired in June 1997) and
internal growth of 4.2%. Internal growth is defined as growth from
the Company's "core businesses," which include continuing businesses
owned more than two years and minor acquisitions completed during
the last two years. Net sales for each of the Company's product
groups (and the primary reasons for the increases) were as follows,
in millions:
<TABLE>
Primary Reasons
1997 1996 % Change for Increases
-------- -------- -------- ---------------
<S> <C> <C> <C> <S>
Home Furnishings $234.8 $218.7 7.4% May 1997 Kirsch
acquisition offset
by 3% internal
sales declines
Office Products 266.4 224.4 18.7% 15% internal growth
and March 1997
Rolodex and June
1997 Rubbermaid
office products
acquisitions
Housewares 194.8 190.0 2.5% Internal growth
Hardware & Tools 104.9 102.0 2.8% Internal growth
----- -----
$800.9 $735.1 9.0%
===== ===== ====
</TABLE>
Gross income as a percent of net sales in the second quarter
of 1997 was 33.2% or $265.8 million versus 32.1% or $235.9 million
in the comparable quarter of 1996. Gross margins improved as a result
of cost savings achieved through the integration of Holson Burnes and
Decorel into the Intercraft picture frame business, strong back-to-
school shipments at the Company's office products businesses, and
increased gross margins at several of the Company's other core
businesses.
Selling, general and administrative expenses ("SG&A") in the second
quarter of 1997 were 14.7% of net sales or $117.9 million versus
14.6% or $107.4 million in the comparable quarter of 1996. The
slight increase in spending was due to higher than average spending
levels at businesses acquired in 1997, while core business SG&A
expense was flat and spending levels decreased in the picture frame
business as a result of the integration of Holson Burnes and Decorel
into Intercraft.
Operating income in the second quarter of 1997 was 18.5% of net
sales or $147.9 million versus 17.5% or $128.4 million in the
comparable quarter of 1996. The increase in operating income was
primarily due to cost savings as a result of the picture frame
business integration, strong back-to-school shipments, and increased
<PAGE> 11
core business gross margins.
Net nonoperating expenses in the second quarter of 1997 were 2.4% of
net sales or $19.0 million versus 2.1% or $15.5 million in the
comparable quarter of 1996. The $3.5 million increase was due
primarily to a $2.1 million decrease in dividend income. On October
15, 1996, Black & Decker exercised its option to convert the 150,000
shares of privately placed Black & Decker convertible preferred
stock, Series B, owned by the Company (purchased at a cost of
$150.0 million) into 6.4 million shares of Black & Decker common
stock. Prior to conversion, the preferred stock paid a 7.75%
cumulative dividend, aggregating $2.9 million per quarter, before
the effect of income taxes. If Black & Decker continues to pay
dividends at the current rate ($0.12 per share quarterly), the
dividends paid to the Company in 1997 on the shares of Black &
Decker common stock owned by the Company as a result of the
conversion would total $0.8 million per quarter, before the effect
of income taxes.
For the second quarter of 1997 and 1996, the effective tax rate was
39.6% and 40.0%, respectively.
Net income for the second quarter of 1997 was $77.8 million,
representing an increase of $11.1 million or 15.0% from the
comparable quarter of 1996. Earnings per share for the second
quarter of 1997 increased 14.7% to $0.49 versus $0.43 in the
comparable quarter of 1996. The increases in net income and
earnings per share were primarily attributable to cost savings
associated with the picture frame business integration, strong back-
to-school shipments, and increased operating margins at several of
the Company's other core businesses. These increases were offset
partially by increased net nonoperating expenses.
<PAGE> 12
SIX MONTHS ENDED JUNE 30, 1997 VS. SIX MONTHS ENDED JUNE 30, 1996
Net sales for the first six months of 1997 were $1,430.3 million,
representing an increase of $77.0 million or 5.7% from $1,353.3
million in the comparable period of 1996. The overall increase in
net sales was primarily attributable to contributions from the
Rolodex, Kirsch and Rubbermaid office products acquisitions and
internal growth of 2.9%. Net sales for each of the Company's
product groups (and the primary reasons for the increases) were as
follows, in millions:
<TABLE>
Primary Reasons
1997 1996 % Change for Increases
------ ------ -------- ---------------
<S> <C> <C> <C> <S>
Home Furnishings $ 439.0 $ 422.1 4.0% May 1997 Kirsch
acquisition offset
by 1% internal
sales declines
Office Products 416.6 370.1 12.6% 9% internal growth
and March 1997
Rolodex and June 1997
Rubbermaid office products
acquisitions
Housewares 376.1 366.0 2.8% Internal growth
Hardware & Tools 198.6 195.1 1.7% Internal growth
------- -------
$1,430.3 $1,353.3 5.7%
======= ======= ====
</TABLE>
Gross income as a percent of net sales in the first six months of
1997 was 31.8% or $455.1 million versus 30.8% or $417.1 million in
the comparable period of 1996. Gross margins improved as a result
of cost savings achieved through the picture frame business
integration, strong back-to-school shipments, and increased gross
margins at several of the Company's other core businesses.
Selling, general and administrative expenses in the first six months
of 1997 were 15.9% of net sales or $227.9 million versus 16.2% or
$219.2 million in the comparable period of 1996. The slight
increase in spending was due to higher than average spending levels
at businesses acquired in 1997, while core business SG&A expense was
flat and spending levels decreased as a result of the picture frame
business integration.
Operating income in the first six months of 1997 was 15.9% of net
sales or $227.2 million versus 14.6% or $197.9 million in the
comparable period of 1996. The increase in operating income was
primarily due to cost savings as a result of the picture frame
business integration, strong back-to-school shipments, and increased
core business gross margins.
Net nonoperating expenses in the first six months of 1997 were 2.5%
of net sales or $35.8 million versus 2.2% or $29.7 million in the
comparable period of 1996. The $6.1 million increase was due
primarily to a $4.2 million decrease in dividend income. Refer to
the previous detailed discussion on page 11.
<PAGE> 13
For this six month period in 1997 and 1996, the effective tax rate
was 39.6% and 40.0%, respectively.
Net income for the first six months of 1997 was $115.6 million,
representing an increase of $14.7 million or 14.6% from the
comparable period of 1996. Earnings per share for the first six
months of 1997 increased 14.4% to $0.73 versus $0.64 the comparable
period of 1996. The increase in net income and earnings per share
were primarily attributable to cost savings associated with the
picture frame integration, strong back-to-school shipments, and
increased core business operating margins. These increases were
offset partially by increased net nonoperating expenses.
<PAGE> 14
LIQUIDITY AND CAPITAL RESOURCES
SOURCES:
The Company's primary sources of liquidity and capital resources
include cash provided from operations and use of available borrowing
facilities.
Cash provided by operating activities was $37.8 million and $87.4
million for the six months ended June 30, 1997 and 1996,
respectively. This $49.6 million decrease was primarily due to an
inventory reduction program in 1996 and higher working capital needs
as the Company grows internally.
Cash provided from financing activities totalled $591.3 million for
the six months ended June 30, 1997, primarily due to an increase in
long-term borrowings as a result of the Rolodex, Kirsch and
Rubbermaid office products acquisitions.
During 1997, the Company amended and restated its revolving credit
agreement to provide for a $1.3 billion agreement which will terminate
in August 2002. Under this agreement, the Company may borrow, repay
and reborrow funds in an aggregate amount up to $1.3 billion, at a
floating interest rate. At June 30, 1997, there were no borrowings
under the revolving credit agreement.
In lieu of borrowings under the Company's revolving credit
agreement, the Company may issue up to $900.0 million of commercial
paper. The Company's revolving credit agreement provides the
committed backup liquidity required to issue commercial paper.
Accordingly, commercial paper may only be issued up to the amount
available for borrowing under the Company's revolving credit
agreement. At June 30, 1997, $846.0 million (face or principal
amount) of commercial paper was outstanding. The entire amount is
classified as long-term debt.
At June 30, 1997, the Company had outstanding $263.0 million
(principal amount) of medium-term notes with maturities ranging from
five to ten years at an average rate of interest equal to 6.3%.
The Company has a universal shelf registration statement on file
with the Securities and Exchange Commission under which the Company
may issue up to $500.0 million of debt and equity securities, subject
to market conditions. At June 30, 1997, the Company had not yet issued
any securities under this registration statement.
The Company has short-term foreign and domestic uncommitted lines of
credit with various banks which are available for short-term
financing. Borrowings under the Company's uncommitted lines of
credit are subject to discretion of the lender. The Company's
uncommitted lines of credit do not have a material impact on the
Company's liquidity. Borrowings under the Company's uncommitted
lines of credit at June 30, 1997 totalled $304.0 million.
<PAGE> 15
USES:
The primary uses of liquidity and capital resources include capital
expenditures, dividend payments and acquisitions.
Cash used in investing activities was $602.3 million and $74.3
million for the six months ended June 30, 1997 and 1996,
respectively. In 1997, the Company acquired Rolodex, Kirsch and
Rubbermaid office products for cash purchase prices totaling $570.1
million. In 1996, the Company acquired Holson Burnes and completed
other minor acquisitions for consideration that included cash of
$42.6 million. At the time of acquisition, cash and short-term
investments recorded by the new businesses totalled $12.5 million;
the Company had already paid $13.3 million in 1991 when it initially
invested in Acrimo (refer to footnote 7). The 1997 and 1996
acquisitions were accounted for as purchases and were paid for with
proceeds obtained from the issuance of commercial paper, medium-term
notes, and notes payable under the Company's lines of credit.
Capital expenditures were $24.5 million and $29.3 million in the
first six months of 1997 and 1996, respectively.
The Company has paid regular cash dividends on its common stock
since 1947. On February 11, 1997, the quarterly cash dividend was
increased to $0.16 per share from the $0.14 per share that had been
paid since February 6, 1996. Prior to this date, a quarterly cash
dividend of $0.12 per share had been paid since May 11, 1995 which
was an increase from the $0.10 per share paid since May 12, 1994.
Dividends paid were $50.9 million and $44.4 million in the first six
months of 1997 and 1996, respectively. Retained earnings increased
by $64.7 million and $56.4 million in the first six months of 1997
and 1996, respectively.
Working capital at June 30, 1997 was $472.5 million compared to
$471.1 million at December 31, 1996. The current ratio at June 30,
1997 was 1.50:1 compared to 1.74:1 at December 31, 1996. Total debt
to total capitalization (net of cash and cash equivalents) was .47:1
at June 30, 1997 and .34:1 at December 31, 1996.
The Company believes that cash provided from operations and
available borrowing facilities will continue to provide adequate
support for the cash needs of existing businesses; however, certain
events, such as significant acquisitions, could require additional
external financing.
<PAGE> 16
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
a) Exhibits:
10.17 Amended and Restated Credit Agreement, dated
as of June 12, 1995 and amended and restated as of
August 5, 1997, among the Company, certain of its
affiliates, The Chase Manhattan Bank (National
Association), as Agent, and the banks whose
names appear on the signature pages thereto.
27 Financial Data Schedule
b) Reports on Form 8-K:
Registrant filed Reports on Form 8-K and Form 8-K/A, each
dated June 6, 1997, reporting that Registrant amended its
Distribution Agreement with Merrill Lynch, Pierce, Fenner &
Smith, Chase Securities Inc., Morgan Stanley & Co.
Incorporated and First Chicago Capital Markets, Inc. in
connection with a proposed public offering of Medium-Term
Notes (including Remarketed Notes) under Registrant's shelf
Registration Statement on Form S-3 (Reg. No. 33-64225).
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
NEWELL CO.
Date August 8, 1997 /s/ William T.edge
----------------- ------------------------
William T. Alldredge
Vice President - Finance
Date August 8, 1997 /s/ Brett E. Gries
----------------- ------------------------
Brett E. Gries
Vice President - Accounting & Tax
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> This schedule contains summary financial
information extracted from the Newell Co.
and Subsidiaries Consolidated Balance
Sheets and Statements of Income and is
qualified in its entirety by reference to
such financial statements.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 22,709
<SECURITIES> 0
<RECEIVABLES> 563,458
<ALLOWANCES> (16,449)
<F1>
<INVENTORY> 648,942
<CURRENT-ASSETS> 1,416,098
<PP&E> 1,042,060
<F2>
<DEPRECIATION> (373,632)
<F2>
<TOTAL-ASSETS> 3,925,000
<CURRENT-LIABILITIES> 943,574
<BONDS> 1,116,583
0
0
<COMMON> 159,094
<OTHER-SE> 1,426,753
<TOTAL-LIABILITY-AND-EQUITY> 3,925,000
<SALES> 1,430,336
<TOTAL-REVENUES> 455,099
<CGS> 975,237
<TOTAL-COSTS> 1,203,166
<OTHER-EXPENSES> 35,784
<LOSS-PROVISION> 2,125
<F1>
<INTEREST-EXPENSE> 28,105
<INCOME-PRETAX> 191,386
<INCOME-TAX> 75,789
<INCOME-CONTINUING> 115,597
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 115,597
<EPS-PRIMARY> 0.73
<EPS-DILUTED> 0.73
<FN>
<F1> Allowances for doubtful accounts are reported as
contra accounts to accounts receivable. The
corporate reserve for bad debts is a percentage
of trade receivables based on the bad debts
experienced in one or more past years, general
economic conditions, the age of the receivables
and other factors that indicate the element of
uncollectibility in the receivables outstanding
at the end of the period.
<F2> See notes to consolidated financial statements.
</TABLE>
<PAGE>
Exhibit 10.17
Execution Counterpart
======================================================================
NEWELL CO.
--------------------------------
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of June 12, 1995
Amended and Restated as of August 5, 1997
------------------------------
$1,300,000,000
------------------------------
THE CHASE MANHATTAN BANK,
as Administrative Agent
======================================================================
<PAGE> 2
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only.
Page
SECTION 1. DEFINITIONS AND ACCOUNTING MATTERS . . . . . . . . . 1
1.01 CERTAIN DEFINED TERMS . . . . . . . . . . . . . . . . 1
1.02 ACCOUNTING TERMS AND DETERMINATIONS . . . . . . . . . 15
1.03 TYPES OF LOANS . . . . . . . . . . . . . . . . . . . . 16
SECTION 2. COMMITMENTS . . . . . . . . . . . . . . . . . . . . . 16
2.02 BORROWINGS OF COMMITTED LOANS . . . . . . . . . . . . 17
2.03 COMPETITIVE LOANS . . . . . . . . . . . . . . . . . . 18
2.04 BORROWINGS BY DESIGNATED BORROWERS . . . . . . . . . . 23
2.05 CHANGES OF COMMITMENTS . . . . . . . . . . . . . . . . 24
2.06 FACILITY FEE . . . . . . . . . . . . . . . . . . . . . 24
2.07 LENDING OFFICES . . . . . . . . . . . . . . . . . . . 24
2.08 SEVERAL OBLIGATIONS; REMEDIES INDEPENDENT . . . . . . 24
2.09 EVIDENCE OF DEBT . . . . . . . . . . . . . . . . . . . 25
2.10 PREPAYMENTS . . . . . . . . . . . . . . . . . . . . . 25
2.11 EXTENSION OF COMMITMENT TERMINATION DATE . . . . . . . 26
2.12 INCREASE IN COMMITMENTS . . . . . . . . . . . . . . . 27
SECTION 3. PAYMENTS OF PRINCIPAL AND INTEREST . . . . . . . . . 28
3.01 REPAYMENT OF LOANS . . . . . . . . . . . . . . . . . . 28
3.02 INTEREST . . . . . . . . . . . . . . . . . . . . . . . 28
3.03 REDENOMINATION . . . . . . . . . . . . . . . . . . . . 29
SECTION 4. PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC. . . 29
4.01 PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . 29
4.02 PRO RATA TREATMENT . . . . . . . . . . . . . . . . . . 30
4.03 COMPUTATIONS . . . . . . . . . . . . . . . . . . . . . 31
4.04 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT . . . 31
4.05 SET-OFF; SHARING OF PAYMENTS . . . . . . . . . . . . . 32
SECTION 5. YIELD PROTECTION AND ILLEGALITY. . . . . . . . . . . 33
5.01 ADDITIONAL COSTS . . . . . . . . . . . . . . . . . . . 33
5.02 LIMITATION ON TYPES OF LOANS . . . . . . . . . . . . . 35
5.03 ILLEGALITY . . . . . . . . . . . . . . . . . . . . . . 36
5.04 BASE RATE LOANS PURSUANT TO SECTIONS 5.01 AND 5.03 . . 36
5.05 COMPENSATION . . . . . . . . . . . . . . . . . . . . . 36
5.06 TAXES . . . . . . . . . . . . . . . . . . . . . . . . 37
5.07 REPLACEMENT OF BANKS . . . . . . . . . . . . . . . . . 38
SECTION 6. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . 39
6.01 AMENDMENT EFFECTIVE DATE . . . . . . . . . . . . . . . 39
6.02 INITIAL AND SUBSEQUENT CREDIT EXTENSIONS . . . . . . . 40
SECTION 7. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . 41
7.01 CORPORATE EXISTENCE . . . . . . . . . . . . . . . . . 41
7.02 FINANCIAL CONDITION . . . . . . . . . . . . . . . . . 41
7.03 LITIGATION . . . . . . . . . . . . . . . . . . . . . . 42
<PAGE> 3
7.04 NO BREACH . . . . . . . . . . . . . . . . . . . . . . 42
7.05 CORPORATE ACTION . . . . . . . . . . . . . . . . . . . 42
7.06 APPROVALS . . . . . . . . . . . . . . . . . . . . . . 42
7.07 USE OF CREDIT . . . . . . . . . . . . . . . . . . . . 42
7.08 ERISA . . . . . . . . . . . . . . . . . . . . . . . . 43
7.09 CREDIT AGREEMENTS . . . . . . . . . . . . . . . . . . 43
7.10 HAZARDOUS MATERIALS . . . . . . . . . . . . . . . . . 43
7.11 TAXES . . . . . . . . . . . . . . . . . . . . . . . . 44
7.12 TRUE AND COMPLETE DISCLOSURE. . . . . . . . . . . . . 44
7.13 SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . . 44
7.14 COMPLIANCE WITH LAW . . . . . . . . . . . . . . . . . 45
7.15 DESIGNATED BORROWER APPROVALS . . . . . . . . . . . . 45
SECTION 8. COVENANTS OF THE COMPANY . . . . . . . . . . . . . . 45
8.01 FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . 45
8.02 LITIGATION . . . . . . . . . . . . . . . . . . . . . . 48
8.03 CORPORATE EXISTENCE, ETC. . . . . . . . . . . . . . . 48
8.04 INSURANCE . . . . . . . . . . . . . . . . . . . . . . 48
8.05 USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . 48
8.06 INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . 49
8.07 FUNDAMENTAL CHANGES. . . . . . . . . . . . . . . . . . 49
8.08 LIENS . . . . . . . . . . . . . . . . . . . . . . . . 51
8.09 LINES OF BUSINESSES . . . . . . . . . . . . . . . . . 52
8.10 [Intentionally omitted] . . . . . . . . . . . . . . . 52
8.11 TOTAL INDEBTEDNESS TO TOTAL CAPITAL . . . . . . . . . 52
SECTION 9. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . 52
SECTION 10. THE ADMINISTRATIVE AGENT . . . . . . . . . . . . . . 55
10.01 APPOINTMENT, POWERS AND IMMUNITIES . . . . . . . . . 55
10.02 RELIANCE BY ADMINISTRATIVE AGENT . . . . . . . . . . 56
10.03 DEFAULTS . . . . . . . . . . . . . . . . . . . . . . 56
10.04 RIGHTS AS A BANK . . . . . . . . . . . . . . . . . . 56
10.05 INDEMNIFICATION . . . . . . . . . . . . . . . . . . . 56
10.06 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER BANKS 57
10.07 FAILURE TO ACT . . . . . . . . . . . . . . . . . . . 57
10.08 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT . . . 57
SECTION 11. GUARANTEE . . . . . . . . . . . . . . . . . . . . . 58
11.01 GUARANTEE . . . . . . . . . . . . . . . . . . . . . . 58
11.02 OBLIGATIONS UNCONDITIONAL . . . . . . . . . . . . . . 58
11.03 REINSTATEMENT . . . . . . . . . . . . . . . . . . . . 59
11.04 SUBROGATION . . . . . . . . . . . . . . . . . . . . . 59
11.05 REMEDIES . . . . . . . . . . . . . . . . . . . . . . 59
11.06 CONTINUING GUARANTEE . . . . . . . . . . . . . . . . 60
SECTION 12. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . 60
12.01 WAIVER . . . . . . . . . . . . . . . . . . . . . . . 60
12.02 NOTICES . . . . . . . . . . . . . . . . . . . . . . . 60
12.03 EXPENSES, ETC. . . . . . . . . . . . . . . . . . . . 60
12.04 AMENDMENTS, ETC. . . . . . . . . . . . . . . . . . . 61
12.05 ASSIGNMENTS AND PARTICIPATIONS . . . . . . . . . . . 62
12.06 SURVIVAL . . . . . . . . . . . . . . . . . . . . . . 64
12.07 CAPTIONS . . . . . . . . . . . . . . . . . . . . . . 64
12.08 COUNTERPARTS . . . . . . . . . . . . . . . . . . . . 64
<PAGE> 4
12.09 GOVERNING LAW; JURISDICTION; SERVICE OF PROCESS;
WAIVER OF JURY TRIAL; ETC. . . . . . . . . . . . . 64
12.10 SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . 65
12.11 JUDGMENT CURRENCY. . . . . . . . . . . . . . . . . . 65
12.12 EUROPEAN MONETARY UNION . . . . . . . . . . . . . . . 66
12.13 OUTSTANDING LOANS. . . . . . . . . . . . . . . . . . 67
12.14 EXISTING DESIGNATED BORROWERS AND APPROVED DESIGNATED
BORROWERS . . . . . . . . . . . . . . . . . . . . 67
Annex I - Commitments
Schedule I - List of Indebtedness
Schedule II - List of Certain Liens
Schedule III - Subsidiaries
EXHIBIT A-1 - Form of Opinion of Special Illinois Counsel
EXHIBIT A-2 - Form of Opinion of Dale L. Matschullat, Esq.,
general counsel to the Company and its
Subsidiaries
EXHIBIT B - Form of Opinion of Special New York Counsel to the
Banks and the Agent
EXHIBIT C - [Intentionally Omitted]
EXHIBIT D - Form of Competitive Bid Request
EXHIBIT E - Form of Competitive Bid
EXHIBIT F-1 - Form of Designation Letter
EXHIBIT F-2 - Form of Termination Letter
<PAGE> 5
AMENDED AND RESTATED CREDIT AGREEMENT dated as of June 12,
1995, amended and restated as of August 5, 1997 among: NEWELL CO., a
corporation duly organized and validly existing under the laws of the
State of Delaware (together with its successors, the "COMPANY"); each
of the banks which is a signatory hereto (together with its successors
and permitted assigns, individually, a "BANK" and, collectively, the
"BANKS"); and THE CHASE MANHATTAN BANK, as administrative agent for
the Banks (in such capacity, together with its successors in such
capacity, the "ADMINISTRATIVE AGENT").
The Company has requested that the Existing Credit Agreement
(as hereinafter defined) be amended and restated so as to read in its
entirety as herein set forth, and the Banks and the Administrative
Agent are prepared to do so. Accordingly, the parties hereto agree to
amend and restate the Existing Credit Agreement so that it reads in
its entirety as herein provided.
SECTION 1. DEFINITIONS AND ACCOUNTING MATTERS.
----------------------------------
1.01 CERTAIN DEFINED TERMS. As used herein, the following
terms shall have the following meanings (all terms defined in this
Section 1 or in other provisions of this Agreement in the singular to
have the same meanings when used in the plural and VICE VERSA):
"ADMINISTRATIVE AGENT'S ACCOUNT" shall mean, in respect of
any Currency, such account as the Administrative Agent shall designate
in a notice to the Company and the Banks.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in the form supplied by the Administrative Agent.
"AFFILIATE" shall mean, with respect to any Person, any
other Person that directly or indirectly controls or is controlled by
or is under common control with such Person.
"ALTERNATIVE CURRENCY" shall mean at any time any currency
(other than Dollars) so long as at such time, (i) such currency is
dealt with in the London interbank deposit market, (ii) such currency
is freely transferable and convertible into Dollars in the London
foreign exchange market and (iii) no central bank or other
governmental authorization in the country of issue of such currency is
required to permit use of such currency by any Bank for making any
Loan hereunder and/or to permit the relevant Borrower to borrow and
repay the principal thereof and to pay the interest thereon, unless
such authorization has been obtained.
"AMENDMENT EFFECTIVE DATE" shall mean the date on which all
of the conditions set forth in Section 6.01 hereof shall have been
satisfied or waived by the Banks and the Administrative Agent.
<PAGE> 6
"APPLICABLE FACILITY FEE RATE" and "APPLICABLE MARGIN" shall
mean, during any period when the Rating is at one of the Rating Groups
specified below, the percentage set forth below opposite the reference
to such fee or to the relevant Type of Committed Loan:
Rating Rating Rating Rating Rating
Group Group Group Group Group
Fee or Loan I II III IV V
Applicable
Facility 0.055% 0.075% 0.090% 0.100% 0.175%
Fee Rate
Applicable
Margin 0.120% 0.150% 0.185% 0.200% 0.325%
for
Committed
LIBOR
Loans
Applicable
Margin for 0.0% 0.0% 0.0% 0.0% 0.0%
Base Rate
Loans
Any change in the Applicable Facility Fee Rate or in the Applicable
Margin by reason of a change in the Moody's Rating or the Standard &
Poor's Rating shall become effective on the date of announcement or
publication by the respective Rating Agency of a change in such Rating
or, in the absence of such announcement or publication, on the
effective date of such changed rating.
"APPLICABLE LENDING OFFICE" shall mean for each Bank and for
each Type and Currency of Loan the lending office of such Bank (or of
an Affiliate of such Bank) designated for such Type and Currency of
Loan in the Administrative Questionnaire submitted by such Bank or
such other office of such Bank (or of an Affiliate of such Bank) as
such Bank may from time to time specify to the Administrative Agent
and the Company.
"APPROVED DESIGNATED BORROWER" shall mean (i) any Wholly-
Owned Domestic Subsidiary of the Company as to which a Designation
Letter has been delivered to the Administrative Agent and as to which
a Termination Letter shall not have been delivered to the
Administrative Agent, which Subsidiary has been approved as a borrower
hereunder by all of the Banks, all in accordance with Section 2.04
hereof, and (ii) for the purposes of Section 5.06 hereof, the Company.
"ASC RECEIVABLES SALE AGREEMENT" shall mean the receivables
sale agreement dated December 3, 1991 among the Company as seller and
collection agent, Asset Securitization Cooperative Corporation as
purchaser and Canadian Imperial Bank of Commerce as administrative
agent, as amended, supplemented and otherwise modified and in effect
from time to time.
<PAGE> 7
"BASE RATE" shall mean, with respect to any Base Rate Loan,
for any day, the higher of (a) the Federal Funds Rate for such day
plus 1/2 of 1% and (b) the Prime Rate for such day.
"BASE RATE LOANS" shall mean Loans which bear interest based
upon the Base Rate.
"BASEL ACCORD" shall mean the proposals for risk-based
capital framework described by the Basel Committee on Banking
Regulations and Supervisory Practices in its paper entitled
"International Convergence of Capital Measurement and Capital
Standards" dated July 1988, as amended, supplemented and otherwise
modified and in effect from time to time, or any replacement thereof.
"BASIC DOCUMENTS" shall mean this Agreement, the Notes, each
Designation Letter and each Termination Letter.
"BORROWERS" shall mean the Company, each Approved Designated
Borrower and each Designated Borrower.
"BUSINESS DAY" shall mean any day (a) on which commercial
banks are not authorized or required to close in New York City and (b)
where such term is used in the definition of "Quarterly Dates" in this
Section 1.01 and if such day relates to the giving of notices or
quotes in connection with a LIBOR Auction or to a borrowing of, a
payment or prepayment of principal of or interest on, or an Interest
Period for, a LIBO Rate Loan or a notice by the Company with respect
to any such borrowing, payment, prepayment or Interest Period, also on
which dealings in deposits are carried out in the London interbank
market and (c) if such day relates to a borrowing of, a payment or
prepayment of principal of or interest on, or an Interest Period for,
any Loan denominated in an Alternative Currency, or a notice by the
Company with respect to any such borrowing, payment, prepayment or
Interest Period, also on which foreign exchange trading is carried out
in the London interbank market and on which banks are open in the
place of payment in the country in whose Currency such Loan is
denominated.
"CAPITAL LEASE OBLIGATIONS" shall mean, as to any Person,
the obligations of such Person to pay rent or other amounts under a
lease of (or other agreement conveying the right to use) real and/or
personal property which obligations are required to be classified and
accounted for as a capital lease on a balance sheet of such Person
under GAAP (including Statement of Financial Accounting Standards No.
13 of the Financial Accounting Standards Board) and, for purposes of
this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP
(including such Statement No. 13).
"CHASE" shall mean The Chase Manhattan Bank.
"CODE" shall mean the Internal Revenue Code of 1986, as
amended.
<PAGE> 8
"COMMITMENT" shall mean, as to each Bank, the obligation of
such Bank to make Committed Loans in an aggregate amount at any one
time outstanding equal to the amount set opposite such Bank's name on
Annex I hereto under the caption "Commitment" (as the same may be
reduced pursuant to Section 2.05 hereof). The original aggregate
principal amount of the Commitments is $1,300,000,000.
"COMMITMENT TERMINATION DATE" shall mean August 5, 2002, as
such date may be extended pursuant to Section 2.11 hereof; provided
that, if such date is not a Business Day, the Commitment Termination
Date shall be the next preceding Business Day.
"COMMITTED LOANS" shall mean the loans provided for by
Section 2.01 hereof.
"COMMITTED LIBOR LOANS" shall mean Committed Loans the
interest rates on which are determined on the basis of LIBO Rates.
"COMPETITIVE AFFILIATE LOAN" means a Competitive Loan to be
made by an Affiliate of a Bank pursuant to Section 2.03(h).
"COMPETITIVE BID" shall have the meaning assigned to that
term in Section 2.03(c) hereof.
"COMPETITIVE BID RATE" shall have the meaning assigned to
that term in Section 2.03(c)(ii)(D) hereof.
"COMPETITIVE BID REQUEST" shall have the meaning assigned to
that term in Section 2.03(b) hereof.
"COMPETITIVE BORROWING" shall have the meaning assigned to
that term in Section 2.03(b) hereof.
"COMPETITIVE LIBOR LOANS" shall mean Competitive Loans the
interest rates on which are determined on the basis of LIBO Rates
pursuant to a LIBOR Auction.
"COMPETITIVE LOAN LIMIT" shall have the meaning assigned to
that term in Section 2.03(c)(ii) hereof.
"COMPETITIVE LOANS" shall mean the loans provided for by
Section 2.03 hereof.
"CREDIT EXTENSION" shall mean the making of any Loan
hereunder.
"CURRENCY" shall mean Dollars or any Alternative Currency.
"DEFAULT" shall mean an Event of Default or an event which
with notice or lapse of time or both would become an Event of Default.
"DESIGNATED BORROWER" shall mean any Wholly-Owned Subsidiary
of the Company as to which a Designation Letter has been delivered to
the Administrative Agent and as to which a Termination Letter shall
not have been delivered to the Administrative Agent in accordance with
<PAGE> 9
Section 2.04 hereof; and the term "Designated Borrower" shall include
any Approved Designated Borrower.
"DESIGNATION LETTER" shall have the meaning assigned to such
term in Section 2.04(a) hereof.
"DETERMINATION DATE" shall mean, for any Disposition, the
last day of the fiscal quarter ending on or immediately preceding the
date of such Disposition.
"DISPOSITION" shall have the meaning assigned to that term
in Section 8.07 hereof.
"DISPOSITION PERIOD" shall mean, for any Disposition, a
period of twelve months ending on the date of such Disposition.
"DOLLAR EQUIVALENT" shall mean, with respect to any Loan
denominated in an Alternative Currency, the amount of Dollars that
would be required to purchase the amount of the Alternative Currency
of such Loan on the date such Loan is requested (or, (a) in the case
of Competitive Loans, the date of the related Competitive Bid Request
and (b) in the case of any redenomination under Section 3.03 hereof,
on the date of such redenomination), based upon the arithmetic mean
(rounded upwards, if necessary, to the nearest 1/100 of 1%), as
determined by the Administrative Agent, of the spot selling rate at
which the Reference Banks offer to sell such Alternative Currency for
Dollars in the London foreign exchange market at approximately 11:00
a.m. London time for delivery two Business Days later.
"DOLLARS" and "$" shall mean lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" shall mean any Subsidiary of the
Company that is incorporated under the laws of the United States of
America or any State thereof or the District of Columbia.
"ENVIRONMENTAL AFFILIATE" shall mean, as to any Person, any
other Person whose liability (contingent or otherwise) for any
Environmental Claim such Person may have retained, assumed or
otherwise become liable (contingently or otherwise), whether by
contract, operation of law or otherwise; PROVIDED that each Subsidiary
of such Person, and each former Subsidiary or division of such Person
transferred to another Person, shall in any event be an "Environmental
Affiliate" of such Person.
"ENVIRONMENTAL CLAIM" shall mean, with respect to any
Person, any notice, claim, demand or other communication (whether
written or oral) by any other Person alleging or asserting liability
of such Person for investigatory costs, cleanup costs, governmental
response costs, damages to natural resources or other Property,
personal injuries, fines or penalties arising out of, based on or
resulting from (a) the presence, or release into the environment, of
any hazardous material at any location, whether or not owned by such
Person, or (b) circumstances forming the basis of any violation, or
alleged violation, of any Environmental Law.
<PAGE> 10
"ENVIRONMENTAL LAWS" shall mean any and all Federal, state,
local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to
the environment or to emissions, discharges, releases or threatened
releases of pollutants, contaminants, chemicals or industrial, toxic
or hazardous substances or wastes into the environment, including,
without limitation, ambient air, surface water, ground water or land,
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or industrial, toxic or hazardous
substances or wastes.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended from time to time.
"ERISA AFFILIATE" shall mean any corporation or trade or
business which is a member of the same controlled group of
corporations (within the meaning of Section 414(b) of the Code) as the
Company or is under common control (within the meaning of
Section 414(c) of the Code) with the Company.
"EVENT OF DEFAULT" shall have the meaning assigned to that
term in Section 9 hereof.
"EXISTING CREDIT AGREEMENT" shall mean the Five-Year Credit
Agreement dated as of June 12, 1995 among the Company, certain of the
Banks and the Administrative Agent, as amended by Amendments No. 1 and
2 thereto.
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100th of 1%)
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 on such day as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day,
provided that (i) if the day for which such rate is to be determined
is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as
so published on the next succeeding Business Day, and (ii) if such
rate is not so published for any day, the Federal Funds Rate for such
day shall be the average rate charged to Chase on such day on such
transactions as determined by the Administrative Agent.
"FINAL RISK-BASED CAPITAL GUIDELINES" shall mean (i) the
Final Risk-Based Capital Guidelines of the Board of Governors of the
Federal Reserve System (12 C.F.R. Part 208, Appendix A; 12 C.F.R.
Part 225, Appendix A) and (ii) the Final Risk-Based Capital Guidelines
of the Office of the Comptroller of the Currency, and any successor or
supplemental regulations (12 C.F.R. Part 3, Appendix A), and any
successor regulations, in each case, as amended, supplemented and
otherwise modified and in effect from time to time.
"FOREIGN CURRENCY EQUIVALENT" shall mean, with respect to
any amount in Dollars, the amount of any Alternative Currency that
<PAGE> 11
could be purchased with such amount of Dollars using the reciprocal of
foreign exchange rate(s) specified in the definition of the term
"Dollar Equivalent", as determined by the Administrative Agent.
"FOREIGN SUBSIDIARY" shall mean any Subsidiary of the
Company that is not a Domestic Subsidiary.
"GAAP" shall mean generally accepted accounting principles
applied on a basis consistent with those which, in accordance with the
last sentence of Section 1.02(a) hereof, are to be used in making the
calculations for purposes of determining compliance with the
provisions of this Agreement.
"GUARANTEE" of any Person shall mean any guarantee,
endorsement, contingent agreement to purchase or to furnish funds for
the payment or maintenance of, or any other contingent liability on or
with respect to, the Indebtedness, other obligations, net worth,
working capital or earnings of any other Person (including, without
limitation, the liability of such Person in respect of the
Indebtedness of any partnership of which such Person is a general
partner), or the guarantee by such Person of the payment of dividends
or other distributions upon the stock of any other Person, or the
agreement by such Person to purchase, sell or lease (as lessee or
lessor) property, products, materials, supplies or services primarily
for the purpose of enabling any other Person to make payment of its
obligations or to assure a creditor against loss, and the verb
"GUARANTEE" shall have a correlative meaning, provided that the term
"GUARANTEE" shall not include endorsements for collection or deposits
in the ordinary course of business.
"INDEBTEDNESS" shall mean, as to any Person at any date
(without duplication): (i) indebtedness created, issued, incurred or
assumed by such Person for borrowed money or evidenced by bonds,
debentures, notes or similar instruments; (ii) all obligations of such
Person to pay the deferred purchase price of property or services,
excluding, however, trade accounts payable (other than for borrowed
money) arising in, and accrued expenses incurred in, the ordinary
course of business of such Person so long as such trade accounts
payable are paid within 120 days of the date the respective goods are
delivered or the services are rendered; (iii) all Indebtedness of
others secured by a Lien on any asset of such Person, whether or not
such Indebtedness is assumed by such Person; (iv) all Indebtedness of
others Guaranteed by such Person; (v) all Capital Lease Obligations;
(vi) the Investment Amount (if any); (vii) reimbursement obligations
of such Person (whether contingent or otherwise) in respect of bankers
acceptances, surety or other bonds and similar instruments (other than
commercial, standby or performance letters of credit); and
(viii) unpaid reimbursement obligations of such Person (other than
contingent obligations) in respect of commercial, standby or
performance letters of credit.
"INTEREST PERIOD" shall mean:
(a) with respect to any Committed LIBOR Loan, each period
commencing on the date such Committed LIBOR Loan is made and ending on
<PAGE> 12
the numerically corresponding day in the first, second, third or sixth
calendar month thereafter, as the Company (on its own behalf and on
behalf of any other Borrower) may select as provided in Section 2.02
hereof, except that each Interest Period that commences on the last
Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last Business Day of the appropriate
subsequent calendar month.
(b) With respect to any Base Rate Loan, the period commencing on
the date such Base Rate Loan is made and ending on the first Quarterly
Date thereafter.
(c) With respect to any Set Rate Loan, the period commencing on
the date such Set Rate Loan is made and ending on any Business Day up
to 180 days thereafter, as the Company may select as provided in
Section 2.03(b) hereof.
(d) With respect to any Competitive LIBOR Loan, the period
commencing on the date such Competitive LIBOR Loan is made and ending
on the numerically corresponding day in the first, second, third or
sixth calendar month thereafter, as the Company may select as provided
in Section 2.03(b) hereof, except that each Interest Period which
commences on the last Business Day of a calendar month (or any day for
which there is no numerically corresponding day in the appropriate
subsequent calendar month) shall end on the last Business Day of the
appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period would
otherwise commence before and end after the Commitment Termination
Date, such Interest Period shall not be available hereunder; (ii) each
Interest Period which would otherwise end on a day which is not a
Business Day shall end on the next succeeding Business Day (or, in the
case of an Interest Period for any LIBO Rate Loans, if such next
succeeding Business Day falls in the next succeeding calendar month,
on the next preceding Business Day); and (iii) notwithstanding
clause (i) above, no Interest Period for any LIBO Rate Loans shall
have a duration of less than one month and, if the Interest Period for
any such Loans would otherwise be a shorter period, such Loans shall
not be available hereunder.
"INVESTMENT AMOUNT" shall mean the amount described in (i)
clause (1) of the definition of "Investment" in the ASC Receivables
Sale Agreement or (ii) any comparable provision in any other
Receivables Sales Agreement.
"JURISDICTION" shall mean, with respect to any Borrower, the
country or countries (including any political subdivision or taxing
authority thereof or therein) under whose laws such Borrower is
organized or where such Borrower is domiciled, resident or licensed or
otherwise qualified to do business or where any significant part of
the Property of such Borrower is located.
"LIBO BASE RATE" shall mean, with respect to any LIBO Rate
Loan in any Currency:
<PAGE> 13
(a) the rate per annum (rounded upwards, if necessary, to
the nearest 1/16 of 1%) appearing on the Screen for such Currency
as the London Interbank Offered Rate for deposits in such
Currency at approximately 11:00 a.m. London time (or as soon
thereafter as practicable) two Business Days prior to the
first day of the Interest Period for such Loan; or
(b) if such rate does not appear on the Screen (or, if the
Screen shall cease to be publicly available or if the information
contained on the Screen, in the Administrative Agent's reasonable
judgment, shall cease accurately to reflect such London Interbank
Offered Rate, as reported by any publicly available source of
similar market data selected by the Administrative Agent that, in
the Administrative Agent's reasonable judgment, accurately
reflects such London Interbank Offered Rate), the LIBO Base Rate
shall mean, with respect to any LIBO Rate Loan for any Interest
Period, the arithmetic mean, as determined by the Administrative
Agent, of the rate per annum (rounded upwards, if necessary, to
the nearest 1/16 of 1%) quoted by each Reference Bank at
approximately 11:00 a.m. London time (or as soon thereafter as
practicable) two Business Days prior to the first day of the
Interest Period for such Loan for the offering by such Reference
Bank to leading banks in the London (or, in the case of Pounds
Sterling, Paris) interbank market of deposits in such Currency
having a term comparable to such Interest Period and in an amount
comparable to the principal amount of the LIBO Rate Loan to be
made by such Reference Bank (or its Applicable Lending Office, as
the case may be) for such Interest Period; PROVIDED that (i) if
any Reference Bank is not participating in any LIBO Rate Loan,
the LIBO Base Rate for such Loan shall be determined by reference
to the amount of the Loan which such Reference Bank would have
made had it been participating in such Loans, (ii) in determining
the LIBO Base Rate with respect to any Competitive LIBOR Loan,
each Reference Bank shall be deemed to have made a Competitive
LIBOR Loan in an amount equal to $1,000,000, (iii) each Reference
Bank agrees to use its best efforts to furnish timely information
to the Administrative Agent for purposes of determining the LIBO
Base Rate and (iv) if any Reference Bank does not furnish such
timely information for determination of the LIBO Base Rate, the
Administrative Agent shall determine such interest rate on the
basis of timely information furnished by the remaining Reference
Banks.
"LIBO RATE shall mean, for any LIBO Rate Loan, a rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined by the Administrative Agent to be equal to the LIBO Base
Rate for the Interest Period for such Loan divided by 1 minus the
Reserve Requirement for such Loan for such Interest Period.
"LIBO RATE LOANS" shall mean Committed LIBOR Loans and
Competitive LIBOR Loans.
"LIBOR AUCTION" shall mean a solicitation of Competitive
Bids setting forth Margins based on the LIBO Rate pursuant to
Section 2.03 hereof.
<PAGE> 14
"LIEN" shall mean, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, the
Company or any Subsidiary shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease
or other title retention agreement relating to such asset.
"LOANS" shall mean Committed Loans and Competitive Loans.
"MAJORITY BANKS" shall mean Banks having at least 66-2/3% of
(i) the aggregate amount of the Commitments and (ii) if the
Commitments shall have been terminated, the aggregate outstanding
principal amount of all Loans.
"MARGIN" shall have the meaning assigned to that term in
Section 2.03(c)(ii)(C) hereof.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse
effect on (i) the consolidated financial condition, operations,
business or prospects of the Company and its Subsidiaries (taken as a
whole), (ii) the ability of the Company or any Approved Borrower that
is a Significant Subsidiary to perform its obligations under any of
the Basic Documents to which it is a party or (iii) the validity or
enforceability of any of the Basic Documents.
"MOODY'S" shall mean Moody's Investors Service, Inc. or any
successor thereto.
"MOODY'S RATING" shall mean, as of any date, the rating most
recently published by Moody's relating to the unsecured, long-term,
senior debt securities of the Company.
"MULTIEMPLOYER PLAN" shall mean a Plan defined as such in
Section 3(37) of ERISA to which contributions are being made, or have
been made since January 1, 1980 by the Company or any ERISA Affiliate
and which is covered by Title IV of ERISA.
"NET WORTH" shall mean, at any time, the consolidated
stockholders' equity of the Company and its Subsidiaries determined on
a consolidated basis without duplication in accordance with GAAP.
"NON-STRATEGIC PROPERTY" shall mean Property acquired as
part of the acquisition of a business made after June 12, 1995 that is
designated by resolution of the Board of Directors of the Company
adopted no later than six months after such acquisition as non-
strategic Property.
"NOTES" shall mean the promissory notes provided for by
Section 2.09 hereof.
"OBLIGOR" shall mean the Company, in its capacity as a
Borrower hereunder and in its capacity as a guarantor of Loans made to
any Borrower under Section 11 hereof, and each other Borrower.
<PAGE> 15
"PBGC" shall mean the Pension Benefit Guaranty Corporation
or any entity succeeding to any or all its functions under ERISA.
"PERSON" shall mean an individual, a corporation, a company,
a limited liability company, a voluntary association, a partnership, a
trust, an unincorporated organization or a government or any agency,
instrumentality or political subdivision thereof.
"PLAN" shall mean an employee benefit or other plan
established or maintained by the Company or any ERISA Affiliate and
which is covered by Title IV of ERISA, other than a Multiemployer
Plan.
"POST-DEFAULT RATE" shall mean, in respect of any principal
of any Loan or any other amount payable by any Borrower under this
Agreement or any Note which is not paid when due (whether at stated
maturity, by acceleration or otherwise), a rate per annum during the
period commencing on the due date until such amount is paid in full
equal to the sum of 2% PLUS the Base Rate as in effect from time to
time PLUS the Applicable Margin for Base Rate Loans (PROVIDED that, if
such amount in default is principal of a LIBO Rate Loan or a Set Rate
Loan and the due date is a day other than the last day of the Interest
Period therefor, the "Post-Default Rate" for such principal shall be,
for the period commencing on the due date and ending on the last day
of the Interest Period therefor, 2% above the interest rate for such
Loan as provided in Section 3.02 hereof and, thereafter, the rate
provided for above in this definition).
"POUNDS STERLING" shall mean lawful money of England.
"PRIME RATE" shall mean the rate of interest from time to
time announced by Chase at the Principal Office as its prime
commercial lending rate.
"PRINCIPAL OFFICE" shall mean the principal office of Chase,
located on the Restatement Date at 270 Park Avenue, New York, New York
10017.
"PROPERTY" shall mean any right or interest in or to
property of any kind whatsoever, whether real, personal or mixed and
whether tangible or intangible (including, without limitation, shares
of capital stock).
"QUARTERLY DATES" shall mean the last Business Day of each
March, June, September and December, the first of which shall be the
first such day after the Restatement Date.
"RATING" shall mean the Moody's Rating or the Standard &
Poor's Rating.
"RATING AGENCY" shall mean Moody's or Standard & Poor's.
"RATING GROUP I" shall mean the Moody's Rating is at or
above Aa2 or the Standard & Poor's Rating is at or above AA; "RATING
GROUP II" shall mean (a) the Moody's Rating is at or above A3 or the
<PAGE> 16
Standard & Poor's Rating is at or above A- and (b) Rating Group I is
not in effect; "RATING GROUP III" shall mean (a) the Moody's Rating is
at or above Baa1 or the Standard & Poor's Rating is at or above BBB+
and (b) neither Rating Group I nor Rating Group II is in effect;
"RATING GROUP IV" shall mean (a) the Moody's Rating is at or above
Baa2 or the Standard & Poor's Rating is at or above BBB and (b)
neither Rating Group I, Rating Group II nor Rating Group III is in
effect; "RATING GROUP V" shall mean none of Rating Group I, Rating
Group II, Rating Group III or Rating Group IV is in effect; PROVIDED
that, if the Moody's Rating and the Standard & Poor's Rating fall into
different Rating levels, then the applicable Rating Group shall be
based upon the higher of such Ratings.
"RECEIVABLES SALE AGREEMENT" shall mean (i) the
ASC Receivables Sale Agreement and (ii) any other comparable agreement
providing for the periodic sales of accounts receivable.
"REFERENCE BANKS" shall mean Chase, Morgan Guaranty Trust
Company of New York and Royal Bank of Canada.
"REGULATION D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System (or any successor), as the
same may be amended or supplemented from time to time.
"REGULATORY CHANGE" shall mean, with respect to any Bank,
any change after the Restatement Date (or, in the case of any
Competitive LIBOR Loan, the date of the Competitive Bid therefor), in
United States Federal, state or foreign law or regulations (including
Regulation D) or the adoption or making after such date of any
interpretations, directives or requests applying to a class of banks
including such Bank of or under any United States Federal, state or
foreign law or regulations (whether or not having the force of law) by
any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"RESERVE REQUIREMENT" shall mean, for any Interest Period
for any LIBO Rate Loan, the effective maximum rate at which reserves
(including any marginal, supplemental or emergency reserves) are
required to be maintained during such Interest Period under Regulation
D by member banks of the Federal Reserve System in New York City with
deposits exceeding one billion Dollars against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting
the effect of the foregoing, the Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks by
reason of any Regulatory Change against (i) any category of
liabilities which includes deposits by reference to which the LIBO
Base Rate is to be determined or (ii) any category of extensions of
credit or other assets which includes LIBO Rate Loans.
"RESTATEMENT DATE" shall mean August 5, 1997
"SCREEN" shall mean, with respect to any Currency, the
relevant display page as determined by the Administrative Agent of the
Dow Jones Markets Service on which appears the London Interbank
<PAGE> 17
Offered Rate for deposits in such Currency; provided that, if there is
no such page, the relevant Reuters Screen Page will be substituted.
"SET RATE AUCTION" shall mean a solicitation of Competitive
Bids setting forth Competitive Bid Rates pursuant to Section 2.03
hereof.
"SET RATE LOANS" shall mean Competitive Loans the interest
rates on which are determined on the basis of Competitive Bid Rates
pursuant to a Set Rate Auction.
"SIGNIFICANT SUBSIDIARY" shall mean, at any time, any
Subsidiary of the Company if the revenues of such Subsidiary and its
Subsidiaries for the four consecutive fiscal quarters of such
Subsidiary most recently ended (determined on a consolidated basis
without duplication in accordance with GAAP and whether or not such
Person was a Subsidiary of the Company during all or any part of the
fiscal period of the Company referred to below) exceed an amount equal
to 7-1/2% of the revenues of the Company and its Subsidiaries for the
four consecutive fiscal quarters of the Company most recently ended
(determined on a consolidated basis without duplication in accordance
with GAAP and including such Subsidiary and its Subsidiaries on a pro
forma basis if such Subsidiary was not a Subsidiary of the Company).
"STANDARD & POOR'S" shall mean Standard & Poor's Ratings
Group, a division of McGraw-Hill, Inc., or any successor thereto.
"STANDARD AND POOR'S RATING" shall mean, as of any date, the
rating most recently published by Standard & Poor's relating to the
unsecured, long-term, senior debt securities of the Company.
"SUBSIDIARY" of any Person shall mean any corporation of
which at least a majority of the outstanding shares of stock having by
the terms thereof ordinary voting power to elect a majority of the
board of directors of such corporation (irrespective of whether or not
at the time stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of
any contingency) is at the time directly or indirectly owned or
controlled by such Person and/or one or more of the Subsidiaries of
such Person. "WHOLLY-OWNED SUBSIDIARY" shall mean any such
corporation of which all such shares, other than directors' qualifying
shares or shares held by nominees to satisfy any requirement as to
minimum number of shareholders, are so owned or controlled.
"TAXES" shall have the meaning assigned to such term in
Section 5.06(a) hereof.
"TERMINATION LETTER" shall have the meaning assigned to such
term in Section 2.04(a) hereof.
"TOTAL CAPITAL" shall mean the sum of (i) Net Worth plus
(ii) Total Indebtedness.
"TOTAL CONSOLIDATED ASSETS" shall mean, as at any time, the
total of all the assets appearing on a consolidated balance sheet of
<PAGE> 18
the Company and its Subsidiaries determined in accordance with
generally accepted accounting principles applicable to the type of
business in which the Company and such Subsidiaries are engaged, and
may be determined as of a date, selected by the Company, not more than
sixty days prior to the happening of the event for which such
determination is being made.
"TOTAL INDEBTEDNESS" shall mean, as at any time, the total
Indebtedness of the Company and its Subsidiaries determined on a
consolidated basis without duplication.
"TYPE" shall have the meaning assigned to such term in
Section 1.03 hereof.
"WHOLLY-OWNED SUBSIDIARY" shall have the meaning assigned to
such term in the definition of the term "Subsidiary".
1.02 ACCOUNTING TERMS AND DETERMINATIONS.
(a) All accounting terms used herein shall be interpreted,
and, unless otherwise disclosed to the Banks in writing at the time of
delivery thereof in the manner described in subsection (b) below, all
financial statements and certificates and reports as to financial
matters required to be delivered to the Banks hereunder shall be
prepared, in accordance with generally accepted accounting principles
applied on a basis consistent with those used in the preparation of
the latest financial statements furnished to the Banks hereunder after
the Restatement Date (or, until such financial statements are
furnished, consistent with those used in the preparation of the
financial statements referred to in Section 7.02(a) hereof). All
calculations made for the purposes of determining compliance with the
terms of Sections 8.07(a)(vii) and 8.11 hereof shall, except as
otherwise expressly provided herein, be made by application of
generally accepted accounting principles applied on a basis consistent
with those used in the preparation of the annual or quarterly
financial statements furnished to the Banks pursuant to Section 8.01
hereof (or, until such financial statements are furnished, consistent
with those used in the preparation of the financial statements
referred to in Section 7.02(a) hereof) unless (i) the Company shall
have objected to determining such compliance on such basis at the time
of delivery of such financial statements or (ii) the Majority Banks
shall so object in writing within 30 days after delivery of such
financial statements, in either of which events such calculations
shall be made on a basis consistent with those used in the preparation
of the latest financial statements as to which such objection shall
not have been made (which, if objection is made in respect of the
first financial statements delivered under Section 8.01 hereof, shall
mean the financial statements referred to in Section 7.02(a) hereof).
(b) The Company shall deliver to the Banks at the same time
as the delivery of any annual or quarterly financial statement under
Section 8.01 hereof (i) a description in reasonable detail of any
material variation between the application of accounting principles
employed in the preparation of such statement and the application of
accounting principles employed in the preparation of the next
preceding annual or quarterly financial statements as to which no
<PAGE> 19
objection has been made in accordance with the last sentence of
subsection (a) above and (ii) reasonable estimates of the difference
between such statements arising as a consequence thereof.
(c) To enable the ready and consistent determination of
compliance with the covenants set forth in Section 8 hereof, the
Company shall not change the last day of its fiscal year from
December 31, or the last days of the first three fiscal quarters in
each of its fiscal years from March 31, June 30 and September 30,
respectively.
1.03 TYPES OF LOANS. Loans hereunder are distinguished by
"Type" and by "Currency". The "Type" of a Loan refers to whether such
Loan is a Base Rate Loan, a Committed LIBOR Loan, a Competitive LIBOR
Loan or a Set Rate Loan, each of which constitutes a Type. Loans may
be identified by both Type and Currency.
SECTION 2. COMMITMENTS.
2.01 COMMITTED LOANS. Each Bank severally agrees, on the
terms of this Agreement, to make loans to the Company and any Approved
Designated Borrower in Dollars during the period from and including
the Restatement Date to and including the Commitment Termination Date
in an aggregate principal amount at any one time outstanding up to but
not exceeding the amount of such Bank's Commitment as then in effect.
Subject to the terms of this Agreement, during such period the Company
and the Approved Designated Borrowers may borrow, repay and reborrow
the amount of the Commitments by means of Base Rate Loans and
Committed LIBOR Loans; PROVIDED that the aggregate outstanding
principal amount of all Committed Loans at any one time shall not
exceed the aggregate amount of the Commitments at such time; and
PROVIDED, FURTHER, that there may be no more than thirty (30)
different Interest Periods for both Committed Loans and Competitive
Loans outstanding at the same time (for which purpose Interest Periods
described in different lettered clauses of the definition of the term
"Interest Period" shall be deemed to be different Interest Periods
even if they are coterminous).
2.02 BORROWINGS OF COMMITTED LOANS. The Company (on its
own behalf and on behalf of any other Approved Designated Borrower)
shall give the Administrative Agent (which shall promptly notify the
Banks) notice of each borrowing hereunder of Committed Loans, which
notice shall be irrevocable and effective only upon receipt by the
Administrative Agent, shall specify with respect to the Committed
Loans to be borrowed (i) the aggregate amount to be borrowed, which
shall be at least $1,000,000 in the case of Base Rate Loans and
$5,000,000 in the case of Committed LIBOR Loans (or in either case an
integral multiple of $1,000,000 in excess thereof), (iii) the Type and
date (which shall be a Business Day) and (iv) (in the case of
Committed LIBOR Loans) the duration of the Interest Period therefor,
and each such notice shall be given not later than 11:00 a.m. New York
time on the day which is not less than the number of Business Days
prior to the date of such borrowing specified below opposite the type
of such Loans:
<PAGE> 20
Type Number of Business Days
---- -----------------------
Base Rate Loans 0
Committed LIBOR Loans 3
Not later than 2:00 p.m. New York time on the date specified for each
borrowing of Committed Loans hereunder, each Bank shall, subject to
Section 4.01(a) hereof, make available the amount of the Committed
Loan or Loans to be made by it on such date to the Administrative
Agent, at the Administrative Agent's Account for Dollars in
immediately available funds, for account of the relevant Borrower.
The amount so received by the Administrative Agent shall, subject to
the terms and conditions of this Agreement, promptly be made available
to the relevant Borrower by depositing the same, in immediately
available funds, in an account of the relevant Borrower designated by
the Company.
2.03 COMPETITIVE LOANS.
(a) In addition to borrowings of Committed Loans, the
Company (on its own behalf and on behalf of any other Borrower) may,
as set forth in this Section 2.03, request the Banks to make offers to
make Competitive Loans to such Borrower in Dollars or in any
Alternative Currency. The Banks may, but shall have no obligation to,
make such offers and such Borrower may, but shall have no obligation
to, accept any such offers in the manner set forth in this
Section 2.03. Competitive Loans may be Competitive LIBOR Loans or Set
Rate Loans (each a "Type" of Competitive Loan), PROVIDED that there
may be no more than thirty (30) different Interest Periods for both
Committed Loans and Competitive Loans outstanding at the same time
(for which purpose Interest Periods described in different lettered
clauses of the definition of the term "Interest Period" shall be
deemed to be different Interest Periods even if they are coterminous).
Except as otherwise provided in Section 2.12 hereof, Competitive Loans
shall not constitute a utilization of the Commitments.
(b) When any Borrower wishes to request offers to make
Competitive Loans, the Company (on its own behalf and on behalf of any
other Borrower) shall give the Administrative Agent (which shall
promptly notify the Banks) notice in the form of Exhibit D hereto (a
"COMPETITIVE BID REQUEST") so as to be received no later than 11:00
a.m. New York time on (x) the fifth Business Day prior to the date of
borrowing proposed therein in the case of a LIBOR Auction or (y) the
Business Day next preceding the date of borrowing proposed therein, in
the case of a Set Rate Auction, specifying:
(i) the name of the Borrower, the Currency of such
borrowing and the proposed date of such borrowing (a "COMPETITIVE
BORROWING"), which shall be a Business Day;
(ii) the aggregate amount of such Competitive Borrowing,
which shall be at least $5,000,000 or, in the case of Competitive
Loans in an Alternative Currency, the Foreign Currency Equivalent
<PAGE> 21
thereof and, in the case of Competitive Loans in Dollars, an
integral multiple of $1,000,000 in excess thereof;
(iii) the duration of the Interest Period applicable thereto;
and
(iv) whether the Competitive Bids requested are to set forth
a Margin or a Competitive Bid Rate.
The Company (on its own behalf and on behalf of any other
Borrower) may request offers to make Competitive Loans for up to
fifteen (15) different Interest Periods in a single Competitive Bid
Request; PROVIDED that the request for each separate Interest Period
shall be deemed to be a separate Competitive Bid Request for a
separate Competitive Borrowing. Except as otherwise provided in the
preceding sentence, no Competitive Bid Request shall be given within
five Business Days of any other Competitive Bid Request.
(c) (i) Any Bank may, by notice to the Administrative
Agent in the form of Exhibit E hereto (a "COMPETITIVE BID"), submit an
offer to make a Competitive Loan in response to any Competitive Bid
Request; provided that, if the request under Section 2.03(b) hereof
specified more than one Interest Period, such Bank may make a single
submission containing a separate offer for each such Interest Period
and each such separate offer shall be deemed to be a separate
Competitive Bid. Each Competitive Bid must be submitted to the
Administrative Agent not later than (x) 2:00 p.m. (or, in the case of
Competitive Loans in an Alternative Currency, 11:00 a.m.) New York
time on the fourth Business Day prior to the proposed date of
borrowing, in the case of a LIBOR Auction or (y) 11:00 a.m. New York
time on the proposed date of borrowing, in the case of a Set Rate
Auction; PROVIDED that any Competitive Bid submitted by Chase (or its
Applicable Lending Office) may be submitted, and may only be
submitted, if Chase (or such Applicable Lending Office) notifies the
Company of the terms of the offer contained therein not later than
(x) 1:00 p.m. (or, in the case of Competitive Loans in an Alternative
Currency, 10:00 a.m.) New York time on the fourth Business Day prior
to the proposed date of borrowing, in the case of a LIBOR Auction or
(y) 10:45 a.m. New York time on the proposed date of borrowing, in the
case of a Set Rate Auction. Subject to Sections 5.03, 6.03 and 9
hereof, any Competitive Bid so made shall be irrevocable except with
the written consent of the Administrative Agent given on the
instructions of the Company.
(ii) Each Competitive Bid shall specify:
(A) the name of the Borrower, the Currency of such
borrowing, the proposed date of borrowing and the Interest
Period therefor;
(B) the principal amount of the Competitive Loan for
which each such offer is being made, which principal amount
(x) may be greater than or less than the Commitment of the
quoting Bank, (y) must be at least $1,000,000 or, in the
case of a Competitive Loan in an Alternative Currency, the
<PAGE> 22
Foreign Currency Equivalent thereof and, in the case of a
Competitive Loan in Dollars, in an integral multiple of
$1,000,000, and (z) may not exceed the principal amount of
the Competitive Borrowing for which offers were requested;
(C) in the case of a LIBOR Auction, the margin above
or below the applicable LIBO Rate (the "MARGIN") offered for
each such Competitive Loan, expressed as a percentage
(rounded to the nearest 1/10,000th of 1%) to be added to or
subtracted from the applicable LIBO Rate;
(D) in the case of a Set Rate Auction, the rate of
interest per annum (rounded to the nearest 1/10,000th of 1%)
(the "COMPETITIVE BID RATE") offered for each such
Competitive Loan; and
(E) the identity of the quoting Bank.
No Competitive Bid shall contain qualifying, conditional or similar
language or propose terms other than or in addition to those set forth
in the applicable Competitive Bid Request and, in particular, no
Competitive Bid may be conditioned upon acceptance by the Company of
all (or some specified minimum) of the principal amount of the
Competitive Loan for which such Competitive Bid is being made;
PROVIDED that the submission of any Bank containing more than one
Competitive Bid may be conditioned on the Company not accepting offers
contained in such submission that would result in such Bank making
Competitive Loans pursuant thereto in excess of a specified aggregate
amount (the "COMPETITIVE LOAN LIMIT").
(d) The Administrative Agent shall (x) in the case of a Set
Rate Auction, as promptly as practicable after the Competitive Bid is
submitted (but in any event not later than 11:15 a.m. New York time)
or (y) in the case of a LIBOR Auction, by 4:00 p.m. (or, in the case
of Competitive Loans in an Alternative Currency, noon) New York time
on the day a Competitive Bid is submitted, notify the Company (which
will promptly notify the relevant Borrower if it is not the Company)
of the terms (i) of any Competitive Bid submitted by a Bank that is in
accordance with Section 2.03(c) hereof and (ii) of any Competitive Bid
that amends, modifies or is otherwise inconsistent with a previous
Competitive Bid submitted by such Bank with respect to the same
Competitive Bid Request. Any such subsequent Competitive Bid shall be
disregarded by the Administrative Agent unless such subsequent
Competitive Bid is submitted solely to correct a manifest error in
such former Competitive Bid. The Administrative Agent's notice to the
Company shall specify (A) the aggregate principal amount of the
Competitive Borrowing for which offers have been received and (B) the
respective principal amounts and Margins or Competitive Bid Rates, as
the case may be, so offered by each Bank (identifying the Bank that
made each Competitive Bid).
(e) Not later than (x) 11:00 a.m. New York time on the
third Business Day (or, in the case of Competitive Loans in an
Alternative Currency, 2:00 p.m. New York time on the fourth Business
Day) prior to the proposed date of borrowing, in the case of a LIBOR
<PAGE> 23
Auction or (y) noon New York time on the proposed date of borrowing,
in the case of a Set Rate Auction, the Company shall notify the
Administrative Agent of its or the relevant Borrower's, if the
Borrower is not the Company, acceptance or nonacceptance of the offers
so notified to the Company pursuant to Section 2.03(d) hereof (which
notice shall specify the aggregate principal amount of offers from
each Bank for each Interest Period that are accepted; and the failure
of the Company to give such notice by such time shall constitute non-
acceptance) and the Administrative Agent shall promptly notify each
affected Bank of the acceptance or non-acceptance of its offers. The
notice by the Administrative Agent shall also specify the aggregate
principal amount of offers for each Interest Period that were
accepted. The Company (on its own behalf and on behalf of any other
Borrower) may accept any Competitive Bid in whole or in part
(PROVIDED that any Competitive Bid accepted in part from any Bank
shall be in an integral multiple of $1,000,000 or, in the case of a
Competitive Loan in an Alternative Currency, the Foreign Currency
Equivalent thereof (rounded to the nearest 1,000 units of such
Alternative Currency)); PROVIDED that:
(i) the aggregate principal amount of each Competitive
Borrowing may not exceed the applicable amount set forth in the
related Competitive Bid Request;
(ii) the aggregate principal amount of each Competitive
Borrowing shall be at least $5,000,000 or, in the case of a
borrowing of Competitive Loans in an Alternative Currency, the
Foreign Currency Equivalent thereof and, in the case of a
Competitive Borrowing in Dollars, in an integral multiple of
$1,000,000;
(iii) acceptance of offers may, subject to clause (v) below,
only be made in ascending order of Margins or Competitive Bid
Rates, as the case may be; PROVIDED that the Company need not
accept on behalf of any Designated Borrower the offer of any Bank
if payment of the interest on the relevant Competitive Loan would
subject such Designated Borrower to the requirement of paying any
additional amounts under Section 5.06(a) hereof or if such
interest payment would be subject to greater restrictions on
deductibility for income tax purposes than the restriction
applicable to interest payments made to other Banks whose offers
are accepted;
(iv) the Company (on its own behalf and on behalf of any
other Borrower) may not accept any offer where the Administrative
Agent has advised the Company that such offer fails to comply
with Section 2.03(c)(ii) hereof or otherwise fails to comply with
the requirements of this Agreement (including, without
limitation, Section 2.03(a) hereof); and
(v) the aggregate principal amount of each Competitive
Borrowing from any Bank may not exceed any applicable Competitive
Loan Limit of such Bank.
<PAGE> 24
If offers are made by two or more Banks with the same Margins or
Competitive Bid Rates, as the case may be, for a greater aggregate
principal amount than the amount in respect of which offers are
accepted for the related Interest Period, the principal amount of
Competitive Loans in respect of which such offers are accepted shall
be allocated by the Company among such Banks as nearly as possible (in
an integral multiple of $1,000,000 or, in the case of a Borrowing of
Competitive Loans in an Alternative Currency, the Foreign Currency
Equivalent thereof) in proportion to the aggregate principal amount of
such offers. Determinations by the Company of the amounts of
Competitive Loans shall be conclusive in the absence of manifest
error.
(f) Any Bank whose offer to make any Competitive Loan has
been accepted in accordance with the terms and conditions of this
Section 2.03 shall, not later than 2:00 p.m. New York time (in the
case of Loans denominated in Dollars) or 11:00 a.m. local time in the
location of the Administrative Agent's Account (in the case of Loans
denominated in an Alternative Currency) on the date specified for the
making of such Loan, make the amount of such Loan available to the
Administrative Agent at the Administrative Agent's Account for the
Currency of such Loan in immediately available funds. The amount so
received by the Administrative Agent shall, subject to the terms and
conditions of this Agreement, promptly be made available to the
relevant Borrower on such date by depositing the same, in immediately
available funds, in an account of the relevant Borrower designated by
the Company.
(g) The amount of any Competitive Loan made by any Bank
shall not constitute a utilization of such Bank's Commitment.
(h) Subject to the terms and conditions of this Agreement,
each Foreign Subsidiary that is a Designated Borrower agrees that any
Competitive Loan to be made hereunder by any Bank that has an
Affiliate ("BANK AFFILIATE") in such Designated Borrower's
Jurisdiction may be satisfied by such Bank Affiliate at its sole
discretion (such Loans are hereinafter referred to as "COMPETITIVE
AFFILIATE LOANS"). The Company and each Designated Borrower hereby
acknowledge and agree that any Bank Affiliate that makes a Competitive
Affiliate Loan shall have made such Loan in reliance upon, and shall
be entitled to the benefits of, this Agreement (including, without
limitation, Section 11 hereof) and shall be entitled to enforce rights
hereunder in respect of such Loan as fully as though it were a Bank
party hereto.
2.04 BORROWINGS BY DESIGNATED BORROWERS.
(a) The Company may, at any time or from time to time,
designate one or more Wholly-Owned Subsidiaries as Borrowers hereunder
by furnishing to the Administrative Agent a letter (a "DESIGNATION
LETTER") in duplicate, substantially in the form of Exhibit F-1
hereto, duly completed and executed by the Company and such
Subsidiary. Any such designation of a Foreign Subsidiary shall, and
any such designation of a Domestic Subsidiary may, restrict such
Wholly-Owned Subsidiary to Competitive Loans and may exclude the
<PAGE> 25
applicability of Section 5.06(a) hereof to such Wholly-Owned
Subsidiary, all as set forth in the relevant Designation Letter. Upon
any such designation of a Subsidiary, such Subsidiary shall be a
Borrower entitled to borrow Competitive Loans only; and upon approval
by all of the Banks (which approval shall not be unreasonably
withheld) of any Domestic Subsidiary as an Approved Designated
Borrower (which approval shall be evidenced by the Administrative
Agent signing and returning to the Company a copy of such Designation
Letter) such Domestic Subsidiary shall be an Approved Designated
Borrower entitled to borrow both Committed Loans and Competitive
Loans. So long as all principal and interest on all Loans of any
Borrower (other than the Company) hereunder have been paid in full,
the Company may terminate the status of such Borrower as a Borrower
hereunder by furnishing to the Administrative Agent a letter (a
"TERMINATION LETTER"), substantially in the form of Exhibit F-2
hereto, duly completed and executed by the Company and such Borrower.
Any Termination Letter furnished in accordance with this Section 2.04
shall be effective upon receipt by the Administrative Agent (which
shall promptly notify the Banks), whereupon the Banks shall promptly
deliver to the Company (through the Administrative Agent) the Notes,
if any, of such former Borrower. Notwithstanding the foregoing, the
delivery of a Termination Letter with respect to any Borrower shall
not terminate any obligation of such Borrower theretofore incurred
(including, without limitation, obligations under Sections 5.01, 5.05
and 5.06) or the obligations of the Company under Section 11 hereof
with respect thereto.
(b) The Administrative Agent is hereby authorized by the
Banks (i) to approve (on behalf of all of the Banks) as an Approved
Designated Borrower, and (ii) to sign and return to the Company a
Designation Letter from the Company with respect to, each of the
following Domestic Subsidiaries of the Company:
(1) Newell Operating Company; and
(2) Anchor Hocking Corporation.
(c) No Designation Letter, with respect to an Approved
Designated Borrower may be amended, supplemented or otherwise modified
without the approval of all of the Banks.
2.05 CHANGES OF COMMITMENTS.
(a) Unless theretofore reduced to such amount pursuant to
paragraphs (b) and (c) below, the aggregate amount of the Commitments
shall automatically be reduced to zero on the Commitment Termination
Date.
(b) The Company shall have the right to terminate or reduce
permanently the amount of the Commitments at any time or from time to
time upon not less than three Business Days' prior notice to the
Administrative Agent (which shall promptly notify the Banks) of each
such termination or reduction, which notice shall specify the
effective date thereof and the amount of any such reduction (which
shall be in an integral multiple of $5,000,000) and shall be
<PAGE> 26
irrevocable and effective only upon receipt by the Administrative
Agent; PROVIDED that the Company may not at any time (i) terminate the
Commitments in whole if Committed Loans are then outstanding or
(ii) reduce the aggregate amount of the Commitments below the
aggregate outstanding principal amount of the Committed Loans.
(c) The Commitments once terminated or reduced may not be
reinstated.
2.06 FACILITY FEE. The Company shall pay to the
Administrative Agent for account of each Bank a facility fee on the
daily average amount of such Bank's Commitment (whether used or
unused), for the period from and including the Restatement Date to but
not including the earlier of the date such Commitment is terminated
and the Commitment Termination Date, at a rate per annum equal to the
Applicable Facility Fee Rate. Accrued facility fee shall be payable
in arrears on each Quarterly Date and on the earlier of the date the
Commitments are terminated and the Commitment Termination Date.
2.07 LENDING OFFICES. The Loans of each Type and Currency
made by each Bank shall be made and maintained at such Bank's
Applicable Lending Office for Loans of such Type and Currency.
2.08 SEVERAL OBLIGATIONS; REMEDIES INDEPENDENT. The
failure of any Bank to make any Loan to be made by it on the date
specified therefor shall not relieve any other Bank of its obligation
to make its Loan on such date, and no Bank shall be responsible for
the failure of any other Bank to make a Loan to be made by such other
Bank. The amounts payable by any Borrower at any time hereunder and
under its Notes to each Bank shall be a separate and independent debt
and each Bank shall be entitled to protect and enforce its rights
arising out of this Agreement and the Notes, and it shall not be
necessary for any other Bank or the Administrative Agent to consent
to, or be joined as an additional party in, any proceedings for such
purposes.
<PAGE> 27
2.09 EVIDENCE OF DEBT.
(a) Each Bank shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of each
Borrower to such Bank resulting from each Loan made by such Bank,
including the amounts of principal and interest payable and paid to
such Bank from time to time hereunder.
(b) The Administrative Agent shall maintain accounts in
which it shall record (i) the date, amount, maturity date and interest
rate of each Loan made hereunder, the Type and Currency thereof and
the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable
from each Borrower to each Bank hereunder and (iii) the amount of any
sum received by the Administrative Agent hereunder for the account of
the Banks and each Bank's share thereof.
(c) The entries made in the accounts maintained pursuant to
clause (a) or (b) of this Section 2.09 shall be PRIMA FACIE evidence
of the existence and amounts of the obligations recorded therein;
PROVIDED that the failure of any Bank or the Administrative Agent to
maintain such accounts or any error therein shall not in any manner
affect the obligation of the Borrowers to repay the Loans in
accordance with the terms of this Agreement.
(d) Any Bank may request that Loans made by it to any
Borrower be evidenced by a promissory note of the appropriate
Borrower. In such event, the appropriate Borrower shall prepare,
execute and deliver to such Bank one or more promissory notes payable
to the order of such Bank and in a form approved by the Administrative
Agent.
2.10 PREPAYMENTS. Base Rate Loans may be prepaid upon not
less than one Business Day's prior notice to the Administrative Agent
(which shall promptly notify the Banks), which notice shall specify
the prepayment date (which shall be a Business Day) and the amount of
the prepayment (which, in the case of partial prepayments, shall be in
an integral multiple of $1,000,000) and shall be irrevocable and
effective only upon receipt by the Administrative Agent, PROVIDED that
interest on the principal of any Base Rate Loans prepaid, accrued to
the prepayment date, shall be paid on the prepayment date. LIBO Rate
Loans or Set Rate Loans may not be voluntarily prepaid (PROVIDED that
this sentence shall not affect any Borrower's obligation to prepay
Loans pursuant to Section 9 of this Agreement).
2.11 EXTENSION OF COMMITMENT TERMINATION DATE.
(a) The Company may, by notice to the Administrative Agent
(which shall promptly notify the Banks) not less than 45 days and not
more than 60 days prior to each of the first two anniversaries of the
Restatement Date, request that the Banks extend the Commitment
Termination Date then in effect (the "EXISTING COMMITMENT TERMINATION
DATE") for an additional year from the Existing Commitment Termination
Date. Each Bank, acting in its sole discretion, shall, by notice to
the Company and the Administrative Agent given on or prior to the date
<PAGE> 28
(herein, the "CONSENT DATE") that is 30 days prior to the relevant
anniversary (except that, if such date is not a Business Day, such
notice shall be given on the next succeeding Business Day), advise the
Company whether or not such Bank agrees to such extension; PROVIDED
that each Bank that determines not to extend the Commitment
Termination Date (a "NON-EXTENDING BANK") shall notify the
Administrative Agent (which shall notify the Banks) of such fact
promptly after such determination (but in any event no later than the
Consent Date) and any Bank that does not advise the Company on or
before the Consent Date shall be deemed to be a Non-extending Bank.
The election of any Bank to agree to such extension shall not obligate
any other Bank to so agree.
(b) The Company shall have the right on or before the date
90 days after the Consent Date to replace each Non-extending Bank
with, and otherwise add to this Agreement, one or more other lenders
(which may include any Bank, each prior to the Existing Commitment
Termination Date an "ADDITIONAL COMMITMENT BANK") with (in the case of
any Additional Commitment Bank that is not already a Bank) the
approval of the Administrative Agent (which approval shall not be
unreasonably withheld), each of which Additional Commitment Banks
shall have entered into an agreement in form and substance
satisfactory to the Company and the Administrative Agent pursuant to
which such Additional Commitment Bank shall undertake a Commitment
(and, if any such Additional Commitment Bank is already a Bank, its
Commitment shall be in addition to such Bank's Commitment hereunder on
such date).
(c) If (and only if) the total of the Commitments of the
Banks that have agreed so to extend the Commitment Termination Date as
at the Consent Date shall be at least 66-2/3% of the aggregate amount
of the Commitments in effect immediately prior to the Consent Date,
then, effective as of the relevant anniversary, the Existing
Commitment Termination Date shall be extended to the one year
anniversary of the Existing Commitment Termination Date (except that,
if the date on which the Commitment Termination Date is to be extended
is not a Business Day, such Commitment Termination Date as so extended
shall be the next preceding Business Day) and each Additional
Commitment Bank shall thereupon become a "Bank" for all purposes of
this Agreement (and the Administrative Agent shall notify the Banks of
the extension).
Notwithstanding the foregoing, the extension of the Existing
Commitment Termination Date shall not be effective unless:
(i) no Default shall have occurred and be continuing on
each of the date of the notice requesting such extension, on the
Consent Date and on the relevant anniversary date; and
(ii) each of the representations and warranties made by the
Company in Section 7 hereof shall be true and complete on and as
of each of the date of the notice requesting such extension, the
Consent Date and the relevant anniversary date with the same
force and effect as if made on and as of such date (or, if any
<PAGE> 29
such representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date).
Even if the Existing Commitment Termination Date is extended as
aforesaid, the Commitment of each Non-extending Bank shall terminate
on the Existing Commitment Termination Date and each Non-extending
Bank shall be paid in full all amounts owing to such Bank hereunder on
or before the Existing Termination Date.
2.12 INCREASE IN COMMITMENTS. The Company shall have the
right, so long as no Default shall have occurred and be continuing,
without the consent of any Bank (except as described in clause (i)
below) but with the consent of the Administrative Agent (which consent
shall not be unreasonably withheld), at any time prior to August 5,
2002, to increase the total aggregate amount of the Commitments
hereunder by (a) adding a lender or lenders hereto with a Commitment
or Commitments up to the amount (or aggregate amount) of any such
increase (which lender or lenders shall thereupon become "Banks"
hereunder) and/or (b) enabling any Bank or Banks to increase its (or
their) Commitment (or Commitments) up to the amount of any such
increase; PROVIDED, HOWEVER, that (i) in no event shall any Bank's
Commitment be increased without the consent of such Bank, (ii) if any
Committed Loans are outstanding hereunder on the date that any such
increase is to become effective, the principal amount of all such
Committed Loans shall on or prior to the effectiveness of such
increase, at the option of the Company, either (A) be repaid, together
with accrued interest thereon and any costs incurred by any Bank in
accordance with Section 5.05 (but all such Loans may, on the terms and
conditions hereof, be reborrowed on the date that any such increase
becomes effective pro rata among all of the Banks) or (B) be converted
into Competitive Loans with the same terms (including, without
limitation, interest rate) and maturity of such Committed Loans,
provided that the Competitive Loans into which such Committed Loans
are converted shall constitute a utilization of the Commitments, (iii)
any such increase shall be in an integral multiple of $50,000,000,
(iv) in no event shall any such increase result in the total aggregate
amount of the Commitments exceeding $1,500,000,000 and (v) no increase
in Commitments contemplated by this Section 2.12 shall result in any
one Bank hereunder having a Commitment in an amount which equals more
than 20% of the aggregate amount of all Commitments hereunder. The
Company and the Administrative Agent and the Banks agree to use their
best efforts to effectuate any such increase, subject to the terms and
conditions set forth herein (including, without limitation, by
execution and delivery of any appropriate documentation).
SECTION 3. PAYMENTS OF PRINCIPAL AND INTEREST.
3.01 REPAYMENT OF LOANS. Each Borrower hereby promises to
pay to the Administrative Agent for account of each Bank the principal
amount of each Loan made by such Bank to such Borrower in the Currency
of such Loan, and each Loan shall mature, on the last day of the
Interest Period for such Loan.
3.02 INTEREST.
<PAGE> 30
(a) Each Borrower hereby promises to pay to the
Administrative Agent for account of each Bank interest on the unpaid
principal amount of each Loan made by such Bank to such Borrower, in
the Currency of such Loan, for the period commencing on the date of
such Loan to but excluding the date such Loan shall be paid in full,
at the following rates per annum:
(i) if such Loan is a Base Rate Loan, the Base Rate (as in
effect from time to time);
(ii) if such Loan is a Committed LIBOR Loan, the LIBO Rate
for such Loan for the Interest Period therefor PLUS the
Applicable Margin;
(iii) if such Loan is a Competitive LIBOR Loan, the LIBO Rate
for such Loan for the Interest Period therefor plus (or minus)
the Margin quoted by the Bank making such Loan in accordance with
Section 2.03 hereof; and
(iv) if such Loan is a Set Rate Loan, the Competitive Bid
Rate for such Loan for the Interest Period therefor quoted by the
Bank making such Loan in accordance with Section 2.03 hereof.
Notwithstanding the foregoing, each Borrower hereby promises to pay to
the Administrative Agent for account of each Bank interest at the
applicable Post-Default Rate on any principal of any Loan made by such
Bank to such Borrower, and (to the fullest extent permitted by law) on
any other amount payable by such Borrower hereunder or under the Note
of such Borrower held by such Bank to or for account of such Bank,
which shall not be paid in full when due (whether at stated maturity,
by acceleration or otherwise), for the period commencing on the due
date thereof until the same is paid in full.
(b) Accrued interest on each Loan shall be payable on the
last day of the Interest Period therefor and, if such Interest Period
is longer than three months, at three-month intervals following the
first day of such Interest Period, except that interest payable at the
Post-Default Rate shall be payable from time to time on demand.
(c) Promptly after the determination of any LIBO Rate
provided for herein, the Administrative Agent shall (i) notify the
Banks to which interest at such LIBO Rate is payable and the Company
thereof and (ii) at the request of the Company, furnish to the Company
a copy of the page of the Screen on the basis of which the relevant
LIBO Base Rate was determined. At any time that the Administrative
Agent determines the LIBO Rate on a basis other than using the Screen,
the Administrative Agent shall promptly notify the Company.
3.03 REDENOMINATION. Anything in Section 3.01 or 3.02 to
the contrary notwithstanding, if any Borrower shall fail to pay any
principal or interest denominated in any Alternative Currency on the
original due date therefor (without giving effect to any acceleration
under Section 9 hereof), the amount so in default shall automatically
be redenominated in Dollars on such original due date therefor in an
amount equal to the Dollar Equivalent therefor.
<PAGE> 31
SECTION 4. PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC.
4.01 PAYMENTS.
(a) Except to the extent otherwise provided herein, all
payments of principal of and interest on Loans made in Dollars, and
other amounts (other than the principal of and interest on Loans made
in an Alternative Currency) payable by any Obligor under this
Agreement and the Notes, shall be made in Dollars, and all payments of
principal of and interest on Loans made in an Alternative Currency
shall (except as otherwise provided in Section 3.03 hereof) be made in
such Alternative Currency, in immediately available funds, without
deduction, set-off or counterclaim, to the Administrative Agent's
Account for such Currency, for account of the Banks, not later than
2:00 p.m. New York time (in the case of Loans denominated in Dollars)
or 11:00 a.m. local time in the location of the Administrative Agent's
Account (in the case of Loans denominated in an Alternative Currency),
on the date on which such payment shall become due (each such payment
made after such time on such due date to be deemed to have been made
on the next succeeding Business Day), PROVIDED that if a new Loan is
to be made by any Bank to any Borrower on a date such Borrower is to
repay any principal of an outstanding Loan of such Bank in the same
Currency, such Bank shall apply the proceeds of such new Loan to the
payment of the principal to be repaid and only an amount equal to the
difference between the principal to be borrowed and the principal to
be repaid shall be made available by such Bank to the Administrative
Agent as provided in Section 2.02 hereof or paid by such Borrower to
the Administrative Agent pursuant to this Section 4.01, as the case
may be.
(b) If any Borrower shall default in the payment when due
of any principal, interest or other amounts to be made by such
Borrower under this Agreement or the Notes, any Bank for whose account
any such payment is to be made may (but shall not be obligated to)
debit the amount of any such payment due such Bank which is not made
by such time to any ordinary deposit account of such Borrower with
such Bank (with notice to the Company and the Administrative Agent).
(c) The Company on its behalf and on behalf of any other
Borrower shall, at the time of making each payment under this
Agreement or any Note for account of any Bank, specify to the
Administrative Agent the Loans or other amounts payable by such
Borrower hereunder to which such payment is to be applied (and in the
event that the payor fails to so specify, or if an Event of Default
has occurred and is continuing, such Bank may apply such payment
received by it from the Administrative Agent to such amounts then due
and owing to such Bank as such Bank may determine).
(d) Each payment received by the Administrative Agent under
this Agreement or any Note for account of any Bank shall be paid
promptly to such Bank, in immediately available funds.
(e) If the due date of any payment under this Agreement or
any Note would otherwise fall on a day which is not a Business Day
such date shall be extended to the next succeeding Business Day and
<PAGE> 32
interest shall be payable for any principal so extended for the period
of such extension.
4.02 PRO RATA TREATMENT. Except to the extent otherwise
provided herein: (a) each borrowing from the Banks of Committed Loans
under Section 2.01 hereof shall be made from the Banks, each payment
of fees under Section 2.06 hereof shall be made for account of the
Banks, and each reduction of the amount or termination of the
Commitments under Section 2.05 hereof shall be applied to the
Commitments of the Banks, pro rata according to the amounts of their
respective Commitments; (b) each payment of principal of Committed
Loans by any Borrower shall be made for account of the Banks pro rata
in accordance with the respective unpaid principal amounts of the
Committed Loans held by the Banks; and (c) each payment of interest on
Committed Loans by any Borrower shall be made for account of the Banks
pro rata in accordance with the amounts of interest due and payable to
the respective Banks; PROVIDED that, if an Event of Default shall have
occurred and be continuing, each payment of principal of and interest
on the Loans and other amounts owing hereunder by any Borrower shall
be made for account of the Banks pro rata in accordance with the
aggregate amounts of all principal of and interest on the Loans and
all other amounts owing hereunder by such Borrower then due and
payable to the respective Banks.
4.03 COMPUTATIONS. Interest on Loans and the fees payable
pursuant to Section 2.06 hereof shall be computed on the basis of a
year of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable;
provided that interest on Base Rate Loans and Loans in Pounds Sterling
shall be computed on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable.
4.04 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT.
Unless the Administrative Agent shall have been notified by a Bank or
the Company on behalf of any Borrower (each, a "PAYOR") prior to the
time by, and on the date on, which such Payor is scheduled to make
payment to the Administrative Agent of (in the case of a Bank) the
proceeds of a Loan to be made by it hereunder or (in the case of any
Borrower) a payment to the Administrative Agent for account of one or
more of the Banks hereunder (such payment being herein called the
"REQUIRED PAYMENT"), which notice shall be effective upon receipt,
that it does not intend to make the Required Payment to the
Administrative Agent, the Administrative Agent may assume that the
Required Payment has been made and may, in reliance upon such
assumption (but shall not be required to), make the amount thereof
available to the intended recipient(s) on such date; and, if the Payor
has not in fact made the Required Payment to the Administrative Agent,
the recipient(s) of such payment shall, on demand, repay to the
Administrative Agent the amount so made available together with
interest thereon in respect of each day during the period commencing
on the date such amount was so made available by the Administrative
Agent to but not including the date the Administrative Agent recovers
such amount (the "ADVANCE PERIOD") at a rate per annum equal to (a) if
the recipient is a Borrower, the Base Rate in effect on such day and
<PAGE> 33
(b) if the recipient is a Bank, the Federal Funds Rate in effect on
such day; and, if such recipient(s) shall fail promptly to make such
payment, the Administrative Agent shall be entitled to recover such
amount, on demand, from the Payor, together with interest thereon for
each day during the Advance Period at a rate per annum equal to (i) if
the Payor is a Borrower, the rate of interest payable on the Required
Payment as provided in the second sentence of Section 3.02(a) hereof
and (ii) if the Payor is a Bank, during the period commencing on the
date such amount was so made available to but excluding the date three
Business Days following such date, the Federal Funds Rate in effect on
such day and, thereafter, the Base Rate in effect on such day.
4.05 SET-OFF; SHARING OF PAYMENTS.
(a) Each Obligor agrees that, in addition to (and without
limitation of) any right of set-off, bankers' lien or counterclaim a
Bank may otherwise have, each Bank shall be entitled, at its option,
to offset balances held by it for account of such Obligor at any of
its offices, in Dollars or in any other Currency, against any
principal of or interest on any of such Bank's Loans which is not paid
when due (regardless of whether such balances are then due to such
Obligor) in which case it shall promptly notify such Obligor (through
notice to the Company) and the Administrative Agent thereof, provided
that such Bank's failure to give such notice shall not affect the
validity thereof.
(b) If any Bank shall obtain payment of any principal of or
interest on any Committed Loan made by it under this Agreement through
the exercise of any right of set-off, bankers' lien or counterclaim or
similar right or otherwise, and, as a result of such payment, such
Bank shall have received a greater percentage of the amounts then due
hereunder to such Bank in respect of Committed Loans than the
percentage received by any other Banks, it shall promptly purchase
from such other Banks participations in (or, if and to the extent
specified by such Bank, direct interests in) the Committed Loans made
by such other Banks (or in the interest thereon, as the case may be)
in such amounts, and make such other adjustments from time to time as
shall be equitable, to the end that all the Banks shall share the
benefit of such excess payment (net of any expenses which may be
incurred by such Bank in obtaining or preserving such excess payment)
pro rata in accordance with the unpaid principal and interest on the
Committed Loans held by each of the Banks. To such end all the Banks
shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if such payment is rescinded or must
otherwise be restored. Each Obligor agrees that any Bank so
purchasing a participation (or direct interest) in the Committed Loans
made by other Banks (or in the interest thereon, as the case may be)
may exercise all rights of set-off, bankers' lien, counterclaim or
similar rights with respect to such participation as fully as if such
Bank were a direct holder of Loans (or in the interest thereon, as the
case may be) in the amount of such participation. Nothing contained
herein shall require any Bank to exercise any such right or shall
affect the right of any Bank to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or
obligation of any Obligor. If under any applicable bankruptcy,
<PAGE> 34
insolvency or other similar law, any Bank receives a secured claim in
lieu of a set-off to which this Section 4.05 applies, such Bank shall,
to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Banks
entitled under this Section 4.05 to share in the benefits of any
recovery on such secured claim.
SECTION 5. YIELD PROTECTION AND ILLEGALITY.
5.01 ADDITIONAL COSTS.
(a) Each Borrower shall pay directly to each Bank from time
to time such amounts as such Bank may determine to be necessary to
compensate such Bank for any costs that such Bank determines are
attributable to its making or maintaining of any LIBO Rate Loans or
its obligation to make any LIBO Rate Loans hereunder, or any reduction
in any amount receivable by such Bank hereunder in respect of any of
such Loans or such obligation (such increases in costs and reductions
in amounts receivable being herein called "ADDITIONAL COSTS"),
resulting from any Regulatory Change that:
(i) changes the basis of taxation of any amounts payable to
such Bank under this Agreement or its Notes in respect of any of
such Loans (other than taxes imposed on or measured by the
overall net income of such Bank or of its Applicable Lending
Office for any of such Loans by the jurisdiction in which such
Bank has its principal office or such Applicable Lending Office);
or
(ii) imposes or modifies any reserve, special deposit or
similar requirements (other than the Reserve Requirement utilized
in the determination of the LIBO Rate for such Loan) relating to
any extensions of credit or other assets of, or any deposits with
or other liabilities of, such Bank (including, without
limitation, any of such Loans or any deposits referred to in the
definition of "LIBO Base Rate" in Section 1.01 hereof), or any
commitment of such Bank (including, without limitation, the
Commitment of such Bank hereunder); or
(iii) imposes any other condition affecting this Agreement or
its Notes (or any of such extensions of credit or liabilities) or
its Commitment.
If any Bank requests compensation from any Borrower under this
Section 5.01(a), the Company may, by notice to such Bank (with a copy
to the Administrative Agent), suspend the obligation of such Bank
thereafter to make LIBO Rate Loans until the Regulatory Change giving
rise to such request ceases to be in effect (in which case the
provisions of Section 5.04 hereof shall be applicable), PROVIDED that
such suspension shall not affect the right of such Bank to receive the
compensation so requested.
(b) Without limiting the effect of the provisions of
paragraph (a) of this Section 5.01, in the event that, by reason of
any Regulatory Change, any Bank either (i) incurs Additional Costs
<PAGE> 35
based on or measured by the excess above a specified level of the
amount of a category of deposits or other liabilities of such Bank
that includes deposits by reference to which the interest rate on LIBO
Rate Loans is determined as provided in this Agreement or a category
of extensions of credit or other assets of such Bank that includes
LIBO Rate Loans or (ii) becomes subject to restrictions on the amount
of such a category of liabilities or assets that it may hold, then, if
such Bank so elects by notice to the Company (with a copy to the
Administrative Agent), the obligation of such Bank to make LIBO Rate
Loans hereunder shall be suspended until such Regulatory Change ceases
to be in effect (in which case the provisions of Section 5.04 hereof
shall be applicable).
(c) Without limiting the effect of the foregoing provisions
of this Section 5.01 (but without duplication), the Company shall pay
directly to each Bank from time to time on request such amounts as
such Bank may determine to be necessary to compensate such Bank (or,
without duplication, the bank holding company of which such Bank is a
subsidiary) for any costs that it determines are attributable to the
maintenance by such Bank (or any Applicable Lending Office or such
bank holding company), pursuant to any law or regulation or any
interpretation, directive or request (whether or not having the force
of law and whether or not failure to comply therewith would be
unlawful) of any court or governmental or monetary authority
(i) following any Regulatory Change or (ii) implementing any
risk-based capital guideline or other requirement (whether or not
having the force of law and whether or not the failure to comply
therewith would be unlawful) issued after the Restatement Date by any
government or governmental or supervisory authority implementing at
the national level the Basel Accord (including, without limitation,
the Final Risk-Based Capital Guidelines), of capital in respect of its
Commitment or Loans (such compensation to include, without limitation,
an amount equal to any reduction of the rate of return on assets or
equity of such Bank (or any Applicable Lending Office or such bank
holding company) to a level below that which such Bank (or any
Applicable Lending Office or such bank holding company) would have
achieved with respect to its Commitment or Loans but for such law,
regulation, interpretation, directive or request).
(d) Each Bank shall notify the Company of any event
occurring after the Restatement Date entitling such Bank to
compensation under paragraph (a) or (c) of this Section 5.01 as
promptly as practicable, but in any event within 45 days, after such
Bank obtains actual knowledge thereof. If any Bank fails to give such
notice within 45 days after it obtains actual knowledge of such an
event, such Bank shall, with respect to compensation payable pursuant
to this Section 5.01 in respect of any costs resulting from such
event, only be entitled to payment under this Section 5.01 for costs
incurred from and after the date 45 days prior to the date that such
Bank does give such notice. Each Bank will furnish to the Company a
certificate setting forth the basis and amount of each request by such
Bank for compensation under paragraph (a) or (c) of this Section 5.01.
Determinations and allocations by any Bank for purposes of this
Section 5.01 of the effect of any Regulatory Change pursuant to
paragraph (a) or (b) of this Section 5.01, or of the effect of capital
<PAGE> 36
maintained pursuant to paragraph (c) of this Section 5.01, on its
costs or rate of return of maintaining Loans or its obligation to make
Loans, or on amounts receivable by it in respect of Loans, and of the
amounts required to compensate such Bank under this Section 5.01,
shall be conclusive absent manifest error, PROVIDED that such
determinations and allocations are made on a reasonable basis.
(e) Each Bank will designate a different Applicable Lending
Office for the Loans of such Bank affected by any event specified in
paragraphs (a), (b) or (c) of this Section 5.01 or in Section 5.03
hereof if such designation will avoid the need for, or reduce the
amount of, such compensation or suspension, as the case may be, and
will not, in the sole opinion of such Bank, be disadvantageous to such
Bank.
5.02 LIMITATION ON TYPES OF LOANS. Anything herein to the
contrary notwithstanding:
(a) if the LIBO Base Rate for any Currency is to be
determined under paragraph (b) of the definition of "LIBO Base
Rate" and the Administrative Agent determines (which
determination shall be conclusive) that no quotation from any
Reference Bank of interest rates for the relevant deposits
referred to in such paragraph (b) are not being provided in the
relevant amounts or for the relevant maturities for purposes of
determining rates of interest for LIBO Rate Loans as provided
herein; or
(b) if the LIBO Base Rate for any Currency is being
determined under paragraph (b) of the definition of "LIBO Base
Rate" and the Majority Banks determine (or any Bank that has
outstanding a Competitive Bid with respect to a Competitive LIBOR
Loan, determines), which determination shall be conclusive, and
notify (or notifies, as the case may be) the Administrative Agent
that the relevant rates of interest referred to in paragraph (b)
of the definition of "LIBO Base Rate" do not adequately cover the
cost to such Banks (or such quoting Bank) of making or
maintaining its LIBO Rate Loans in such Currency;
then the Administrative Agent shall give the Company and each Bank
prompt notice thereof, and so long as such condition remains in
effect, the Banks (or such quoting Bank) shall be under no obligation
to make additional LIBO Rate Loans in such Currency.
5.03 ILLEGALITY. Notwithstanding any other provision of
this Agreement, in the event that it becomes unlawful for any Bank or
its Applicable Lending Office to honor its obligation to make or
maintain LIBO Rate Loans hereunder in any Currency, then such Bank
shall promptly notify the Company thereof (with a copy to the
Administrative Agent) and such Bank's obligation to make Committed
LIBOR Loans in such Currency shall be suspended until such time as
such Bank may again make and maintain Committed LIBOR Loans in such
Currency (in which case the provisions of Section 5.04 hereof shall be
applicable), and such Bank shall no longer be obligated to make any
Competitive LIBOR Loan in such Currency that it has offered to make.
<PAGE> 37
5.04 BASE RATE LOANS PURSUANT TO SECTIONS 5.01 AND 5.03.
If the obligation of any Bank to make any LIBO Rate Loans in Dollars
shall be suspended pursuant to Section 5.01 or 5.03 hereof (Loans of
such type being herein called "AFFECTED LOANS" and such type being
herein called the "AFFECTED TYPE"), all Loans in Dollars (other than
Competitive Loans) which would otherwise be made by such Bank as Loans
of the Affected Type shall be made instead as Base Rate Loans (and, if
an event referred to in Section 5.01(b) or 5.03 hereof has occurred
and such Bank so requests by notice to the Company with a copy to the
Administrative Agent, all Affected Loans of such Bank then outstanding
shall be automatically converted into Base Rate Loans on the date
specified by such Bank in such notice) and, to the extent that
Affected Loans are so made as (or converted into) Base Rate Loans, all
payments of principal which would otherwise be applied to such Bank's
Affected Loans shall be applied instead to its Base Rate Loans.
5.05 COMPENSATION. Each Borrower shall pay to the
Administrative Agent for account of each Bank, upon the request of
such Bank through the Administrative Agent, such amount or amounts as
shall be sufficient (in the reasonable opinion of such Bank) to
compensate it for any loss, cost or expense which such Bank determines
are attributable to:
(a) any payment or conversion of a LIBO Rate Loan or a Set
Rate Loan made by such Bank for any reason (including, without
limitation, the acceleration of the Loans pursuant to Section 9
hereof) on a date other than the last day of the Interest Period
for such Loan; or
(b) any failure by such Borrower for any reason (excluding
only failure due solely to a default by any Bank or the
Administrative Agent in its obligation to provide funds to such
Borrower hereunder but including, without limitation, the failure
of any of the conditions precedent specified in Section 6 hereof
to be satisfied) to borrow a LIBO Rate Loan or a Set Rate Loan
from such Bank on the date for such borrowing specified in the
relevant notice of borrowing given pursuant to Section 2.02 or
2.03(b) hereof.
Without limiting the effect of the preceding sentence, such
compensation shall include, in the case of a Loan, an amount equal to
the excess, if any, of (i) the amount of interest which otherwise
would have accrued on the principal amount so paid or converted or not
borrowed for the period from the date of such payment, conversion or
failure to borrow to the last day of the Interest Period for such Loan
(or, in the case of a failure to borrow, the Interest Period for such
Loan which would have commenced on the date specified for such
borrowing) at the applicable rate of interest for such Loan provided
for herein over (ii) the interest component of the amount such Bank
would have bid in the London interbank market for deposits in the
applicable Currency of leading banks (if such Loan is a LIBO Rate
Loan) or in the United States certificate of deposit market for
issuance at face value of certificates of deposit for Dollar deposits
(if such Loan is a Set Rate Loan) in amounts comparable to such
<PAGE> 38
principal amount and with maturities comparable to such period (as
reasonably determined by such Bank).
5.06 TAXES.
(a) Each Approved Designated Borrower agrees to pay to each
Bank such additional amounts as are necessary in order that the net
payment of any amount due to such Bank hereunder after deduction for
or withholding in respect of any Taxes imposed with respect to such
payment will not be less than the amount stated herein to be then due
and payable, PROVIDED that the foregoing obligation to pay such
additional amounts shall not apply:
(i) to any payment to any Bank hereunder unless such Bank
is, on the date such Borrower became a Borrower hereunder (which,
in the case of the Company and the Approved Designated Borrowers
listed in Section 2.04(b) hereof, means the Restatement Date and,
in the case of any other Approved Designated Borrower, means the
date of the Designation Letter of such Approved Designated
Borrower) or (if later) on the date such Bank becomes a Bank
hereunder as provided in Section 12.05(b) hereof and on the date
of any change in the Applicable Lending Office of such Bank,
entitled to a complete exemption from withholding or deduction by
such Approved Designated Borrower of Taxes on all interest to be
received by such Bank hereunder in respect of the Loans made by
such Bank to such Approved Designated Borrower, or
(ii) to any such Taxes required to be deducted or withheld
solely by reason of the failure of such Bank to comply with
applicable certification, information, documentation or other
reporting requirements concerning the nationality, residence,
identity or connections with such Borrower's Jurisdiction if such
compliance is required by treaty, statute or regulation as a
precondition to relief or exemption from such Taxes.
For the purposes of this Section 5.06(a), the term "TAXES" shall mean
with respect to any Approved Designated Borrower all present and
future income, stamp, registration and other taxes and levies,
imposts, deductions, charges, compulsory loans and withholdings
whatsoever, and all interest, penalties or similar amounts with
respect thereto, now or hereafter imposed, assessed, levied or
collected by such Approved Designated Borrower's Jurisdiction on or in
respect of the Basic Documents, the principal of and interest on the
Loans and any other amounts payable under any of the Basic Documents,
the recording, registration, notarization or other formalization of
any thereof, the enforcement thereof or the introduction thereof in
any judicial proceedings, or on or in respect of any payments of
principal, interest, premium, charges, fees or other amounts made on,
under or in respect of any thereof (excluding, however, income or
franchise taxes imposed on or measured by the overall net income or
capital of a Bank (or its Applicable Lending Office) by such Approved
Designated Borrower's Jurisdiction as a result of such Bank being
organized under the laws of or resident in such Approved Designated
Borrower's Jurisdiction or of its Applicable Lending Office being
<PAGE> 39
located or carrying on business in such Approved Designated Borrower's
Jurisdiction).
(b) Within 30 days after paying any amount to the
Administrative Agent or any Bank from which it is required by law to
make any deduction or withholding, and within 30 days after it is
required by law to remit such deduction or withholding to any relevant
taxing or other authority, the relevant Borrower shall deliver to the
Administrative Agent for delivery to such Bank evidence satisfactory
to such Bank of such deduction, withholding or payment (as the case
may be).
5.07 REPLACEMENT OF BANKS. If any Bank requests
compensation pursuant to Section 5.01 or 5.06 hereof, or any Bank's
obligation to make Loans of any Type or denominated in any Currency
shall be suspended pursuant to Section 5.01 hereof (any such Bank
requesting such compensation, or whose obligations are so suspended,
being herein called a "REQUESTING BANK"), the Company, upon
three Business Days' notice to the Administrative Agent given when no
Default shall have occurred and be continuing, may require that such
Requesting Bank transfer all of its right, title and interest under
this Agreement to any bank or other financial institution identified
by the Company that is satisfactory to the Administrative Agent (a) if
such bank or other financial institution (a "PROPOSED BANK") agrees to
assume all of the obligations of such Requesting Bank hereunder, and
to purchase all of such Requesting Bank's Loans hereunder for
consideration equal to the aggregate outstanding principal amount of
such Requesting Bank's Loans, together with interest thereon to the
date of such purchase, and satisfactory arrangements are made for
payment to such Requesting Bank of all other amounts payable hereunder
to such Requesting Bank on or prior to the date of such transfer
(including any fees accrued hereunder and any amounts that would be
payable under Section 5.05 hereof as if all of such Requesting Bank's
Loans were being prepaid in full on such date) and (b) if such
Requesting Bank has requested compensation pursuant to Section 5.01
or 5.06 hereof, such Proposed Bank's aggregate requested compensation,
if any, pursuant to said Section 5.01 or 5.06 with respect to such
Requesting Bank's Loans is lower than that of the Requesting Bank.
Subject to the provisions of Section 12.05(b) hereof, such Proposed
Bank shall be a "Bank" for all purposes hereunder. Without prejudice
to the survival of any other agreement of the Company hereunder the
agreements of the Company contained in Sections 5.01, 5.06 and 12.03
(without duplication of any payments made to such Requesting Bank by
the Company or the Proposed Bank) shall survive for the benefit of
such Requesting Bank under this Section 5.07 with respect to the time
prior to such replacement.
SECTION 6. CONDITIONS PRECEDENT.
6.01 AMENDMENT EFFECTIVE DATE. The effectiveness of the
amendment and restatement of the Existing Credit Agreement provided
for hereby is subject to the receipt by the Administrative Agent of
the following documents, each of which shall be satisfactory to the
Administrative Agent in form and substance:
<PAGE> 40
(a) Certified copies of the charter and by-laws of, and all
corporate action taken by, the Company approving this Agreement
and the Notes (if any) to be made by the Company, borrowings by
the Company and the guarantee of the Company set forth in Section
11 hereof (including, without limitation, a certificate setting
forth the resolutions of the Board of Directors of the Company
adopted in respect of the transactions contemplated hereby).
(b) A certificate of the Company in respect of each of the
officers (i) who is authorized to sign this Agreement, the Notes,
Competitive Bid Requests, Designation Letters and Termination
Letters, together with specimen signatures, and (ii) who will,
until replaced by another officer or officers duly authorized for
that purpose, act as its representative for the purposes of
signing documents and giving notices and other communications in
connection herewith and with the Notes and the transactions
contemplated hereby and thereby. The Administrative Agent and
each Bank may conclusively rely on such certificate until they
receive notice in writing from the Company to the contrary.
(c) An opinion of Schiff, Hardin & Waite, special Illinois
counsel to the Company substantially in the form of Exhibit A-1
hereto (and the Company hereby instructs such counsel to deliver
such opinion to the Banks and the Administrative Agent); and an
opinion of Dale L. Matschullat, Esq., general counsel to the
Company, substantially in the form of Exhibit A-2 hereto (and the
Company hereby instructs such counsel to deliver such opinion to
the Banks and the Administrative Agent).
(d) An opinion of Milbank, Tweed, Hadley & McCloy, special
New York counsel to the Banks and the Administrative Agent,
substantially in the form of Exhibit B hereto.
(e) All principal of and interest on any Syndicated Loans
outstanding under the Existing Credit Agreement and all fees
payable under the Existing Credit Agreement shall have been paid
in full.
6.02 INITIAL AND SUBSEQUENT CREDIT EXTENSIONS. The
obligation of any Bank to make any Credit Extension hereunder
(including, without limitation, the initial Credit Extension
hereunder) is subject to the further conditions precedent that, as of
the date of such Credit Extension and after giving effect thereto and
the intended use thereof:
(a) no Default shall have occurred and be continuing; and
(b) the representations and warranties made by the Company
in Section 7 hereof shall be true on and as of the date of such
Credit Extension with the same force and effect as if made on and
as of such date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as of
such specific date).
<PAGE> 41
Each notice of borrowing by the Company hereunder (whether on its own
behalf or on behalf of any other Borrower) shall constitute a
certification by the Company to the effect set forth in the preceding
sentence (both as of the date of such notice and, unless the Company
otherwise notifies the Administrative Agent prior to the date of such
Credit Extension, as of the date of such Credit Extension).
SECTION 7. REPRESENTATIONS AND WARRANTIES. The Company
represents and warrants to the Banks that:
7.01 CORPORATE EXISTENCE. Each of the Company and its
Significant Subsidiaries: (a) is a corporation duly organized and
validly existing under the laws of the jurisdiction of its
incorporation; (b) has all requisite corporate power, and has all
material governmental licenses, authorizations, consents and
approvals, necessary to own its assets and carry on its business as
now being or as proposed to be conducted; and (c) is qualified to do
business in all jurisdictions in which the nature of the business
conducted by it makes such qualification necessary except where
failure so to qualify would not have a material adverse effect on the
consolidated financial condition, operations, business or prospects of
the Company and its Subsidiaries (taken as a whole).
7.02 FINANCIAL CONDITION.
(a) The consolidated balance sheet of the Company and its
Subsidiaries as at December 31, 1996 and the related consolidated
statements of income, cash flows and stockholders' equity of the
Company and its Subsidiaries for the fiscal year ended on said date,
with the opinion thereon of Arthur Andersen & Co., heretofore
furnished to each of the Banks, are complete and correct and fairly
present the consolidated financial condition of the Company and its
Subsidiaries as at said date and the consolidated results of their
operations for the fiscal year ended on said date, all in accordance
with generally accepted accounting principles. Neither the Company
nor any of its Subsidiaries had on said date any material contingent
liabilities, material liabilities for taxes, material unusual forward
or long-term commitments or material unrealized or anticipated losses
from any unfavorable commitments, except as referred to or reflected
or provided for in said balance sheet as at said date.
(b) The consolidated balance sheet of the Company and its
Subsidiaries as at March 31, 1997 and the related consolidated
statements of income, cash flows and stockholders' equity of the
Company and its Subsidiaries for the fiscal quarter ended on said
date, heretofore furnished to each of the Banks, are complete and
correct and fairly present the consolidated financial condition of the
Company and its Subsidiaries as at said date and the consolidated
results of their operations for the fiscal quarter ended on said date,
all in accordance with generally accepted accounting principles.
Neither the Company nor any of its Subsidiaries had on said date any
material contingent liabilities, material liabilities for taxes,
material unusual forward or long-term commitments or material
unrealized or anticipated losses from any unfavorable commitments,
<PAGE> 42
except as referred to or reflected or provided for in said balance
sheet as at said date.
(c) Since December 31, 1996, there has been no material
adverse change in the consolidated financial condition, operations,
business or prospects of the Company and its Subsidiaries (taken as a
whole).
7.03 LITIGATION. To the best knowledge and belief of the
Company, there are no legal or arbitral proceedings or any proceedings
by or before any governmental or regulatory authority or agency, now
pending or (to the knowledge of the Company) threatened against the
Company or any of its Subsidiaries which could reasonably be expected
to have a Material Adverse Effect.
7.04 NO BREACH. None of the making or performance of this
Agreement or the Notes, or the consummation of the transactions herein
or therein contemplated, will conflict with or result in a breach of,
or require any consent under, the charter or by-laws of the Company or
any applicable law or regulation, or any order, writ, injunction or
decree of any court or governmental authority or agency, or any
agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which any of them is bound or to which
any of them is subject, or constitute a default under any such
agreement or instrument, or constitute a tortious interference with
any agreement, or result in the creation or imposition of any Lien
upon any of the revenues or assets of the Company or any of its
Subsidiaries pursuant to the terms of any such agreement or
instrument.
7.05 CORPORATE ACTION. The Company has all necessary
corporate power and authority to make and perform its obligations
under this Agreement and the Notes of the Company; the making and
performance of this Agreement and the Notes of the Company by the
Company have been duly authorized by all necessary corporate action on
the part of the Company; and this Agreement has been duly and validly
executed and delivered by the Company and constitutes, and each of the
Notes of the Company when executed and delivered by the Company for
value will constitute, its legal, valid and binding obligation,
enforceable in accordance with their respective terms, except to the
extent that such enforcement may be limited by applicable bankruptcy,
insolvency or other similar laws affecting the enforcement of
creditors' rights generally.
7.06 APPROVALS. No authorizations, approvals or consents
of, and no filings or registrations with, any governmental or
regulatory authority or agency are necessary for the execution,
delivery or performance by the Company of this Agreement or the Notes
of the Company or for the validity or enforceability of any thereof.
7.07 USE OF CREDIT. Neither the Company nor any of its
Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose,
whether immediate, incidental or ultimate, of buying or carrying
margin stock (within the meaning of Regulation U or X of the Board of
<PAGE> 43
Governors of the Federal Reserve System), and no part of the proceeds
of any Credit Extension hereunder will be used in a manner that will
cause the Company to violate said Regulation X or any Bank to violate
said Regulation U.
7.08 ERISA. Each of the Company and each ERISA Affiliate
has fulfilled its obligations under the minimum funding standards of
ERISA and the Code with respect to each of its Plans and is (and to
the best of its knowledge in the case of any Multiemployer Plan is) in
compliance in all material respects with the presently applicable
provisions of ERISA and the Code, and has not incurred any liability
on account of the termination of any of its Plans to the PBGC or any
of its Plans and has not incurred any withdrawal liability to any
Multiemployer Plan.
7.09 CREDIT AGREEMENTS. Schedule I hereto is a complete
and correct list, as of the Restatement Date, of each credit
agreement, loan agreement, indenture, purchase agreement, Guarantee or
other arrangement (other than a letter of credit) providing for or
otherwise relating to any extension of credit (or commitment for any
extension of credit) to, or Guarantee by, the Company or any
Subsidiary of any of them the aggregate principal or face amount of
which equals or exceeds (or may equal or exceed) $1,000,000 and the
aggregate principal or face amount outstanding or which may become
outstanding under each such arrangement is correctly described in said
Schedule I.
7.10 HAZARDOUS MATERIALS. The Company and each of its
Subsidiaries have obtained all permits, licenses and other
authorizations that are required under all Environmental Laws, except
to the extent failure to have any such permit, license or
authorization would not have a Material Adverse Effect. The Company
and each of its Subsidiaries are in compliance with the terms and
conditions of all such permits, licenses and authorizations, and are
also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in any applicable Environmental Law
or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved
thereunder, except to the extent failure to comply would not have a
Material Adverse Effect. Except as heretofore disclosed to the Banks,
there have been no environmental investigations, studies, audits,
tests, reviews or other analyses conducted by or that are in the
possession of the Company or any of its Subsidiaries with respect to
any property or facility now or previously owned or leased by the
Company or any of its Environmental Affiliates which reveal facts or
circumstances that could reasonably be expected to have a Material
Adverse Effect.
7.11 TAXES. The Company and its Subsidiaries are members
of an affiliated group of corporations filing consolidated returns for
Federal income tax purposes, of which the Company is the "common
parent" (within the meaning of Section 1504 of the Code) of such
group. The Company and its Subsidiaries have filed all Federal income
tax returns and all other material tax returns and information
<PAGE> 44
statements that are required to be filed by them and have paid all
taxes due pursuant to such returns or pursuant to any assessment
received by the Company or any of its Subsidiaries. The charges,
accruals and reserves on the books of the Company and its Subsidiaries
in respect of taxes and other governmental charges are, in the opinion
of the Company, adequate. The United States Federal income tax
returns of the Company and its Subsidiaries have been examined and/or
closed through the fiscal years of the Company and its Subsidiaries
ended on or before December 31, 1993. The Company has not given or
been requested to give a waiver of the statute of limitations relating
to the payment of Federal, state, local and foreign taxes or other
impositions.
7.12 TRUE AND COMPLETE DISCLOSURE. The information,
reports, financial statements, exhibits and schedules furnished in
writing by or on behalf of the Company to the Banks in connection with
the negotiation, preparation or delivery of this Agreement or included
herein or delivered pursuant hereto, when taken as a whole do not
contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements herein or therein, in
light of the circumstances under which they are made, not misleading.
All written information furnished after the Restatement Date by the
Company and its Subsidiaries to the Banks in connection with this
Agreement and the transactions contemplated hereby will be true,
complete and accurate in every material respect, or (in the case of
projections) based on reasonable estimates, on the date as of which
such information is stated or certified. There is no fact known to
the Company that could reasonably be expected to have a Material
Adverse Effect that has not been disclosed herein or in a report,
financial statement, exhibit, schedule, disclosure letter or other
writing furnished to the Banks for use in connection with the
transactions contemplated hereby.
7.13 SUBSIDIARIES. Set forth in Schedule III hereto is a
complete and correct list, as of the Restatement Date, of all of the
Subsidiaries of the Company, together with, for each such Subsidiary,
(i) the jurisdiction of organization of such Subsidiary, (ii) each
Person holding ownership interests in such Subsidiary and (iii) the
nature of the ownership interests held by each such Person and the
percentage of ownership of such Subsidiary represented by such
ownership interests. Except as disclosed in Schedule III hereto, (x)
each of the Company and its Subsidiaries owns, free and clear of
Liens, and has the unencumbered right to vote, all outstanding
ownership interests in each Person shown to be held by it in Schedule
III hereto and (y) all of the issued and outstanding capital stock of
each such Person organized as a corporation is validly issued, fully
paid and nonassessable.
7.14 COMPLIANCE WITH LAW. As of the Restatement Date, the
Company and its Subsidiaries are in material compliance with all
applicable laws and regulations, except to the extent that failure to
comply therewith would not have a Material Adverse Effect.
7.15 DESIGNATED BORROWER APPROVALS. No authorizations,
approvals or consents of, and no filings or registrations with, any
<PAGE> 45
governmental or regulatory authority or agency that have not been
obtained by the time any Subsidiary of the Company becomes a
Designated Subsidiary are necessary for the execution, delivery or
performance by such Designated Borrower of the Designation Letter of
such Designated Borrower, this Agreement or the Notes of such
Designated Borrower or for the validity or enforceability of any
thereof or for the borrowing by such Designated Borrower hereunder.
SECTION 8. COVENANTS OF THE COMPANY. The Company agrees
that, so long as any of the Commitments are in effect and until
payment in full of all Loans hereunder, all interest thereon and all
other amounts payable by each Borrower hereunder:
8.01 FINANCIAL STATEMENTS. The Company shall deliver to
each of the Banks:
(a) as soon as available and in any event within 60 days
after the end of each of the fiscal quarterly periods of each
fiscal year of the Company, consolidated statements of income,
cash flows and stockholders' equity of the Company and its
Subsidiaries for such period and for the period from the
beginning of the respective fiscal year to the end of such
period, and the related consolidated balance sheet as at the end
of such period, setting forth in each case in comparative form
the corresponding figures for the corresponding period in the
preceding fiscal year, and accompanied by a certificate of a
senior financial officer of the Company, which certificate shall
state that said financial statements fairly present the
consolidated financial condition and results of operations of the
Company and its Subsidiaries, in accordance with generally
accepted accounting principles, as at the end of (and for) such
period (subject to normal year-end audit adjustments).
(b) as soon as available and in any event within 90 days
after the end of each fiscal year of the Company, consolidated
statements of income, cash flows and stockholders' equity of the
Company and its Subsidiaries for such year and the related
consolidated balance sheet as at the end of such year, setting
forth in each case in comparative form the corresponding figures
for the preceding fiscal year, and accompanied by an opinion
thereon of independent certified public accountants of recognized
national standing, which opinion shall state that said financial
statements fairly present the consolidated financial condition
and results of operations of the Company and its Subsidiaries, in
accordance with generally accepted accounting principles, as at
the end of (and for) such fiscal year, and a certificate of such
accountants stating that, in making the examination necessary for
their opinion, they obtained no knowledge, except as specifically
stated, of any Default.
(c) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any,
which the Company shall have filed with the Securities and
Exchange Commission (or any governmental agency substituted
therefor) or any national securities exchange.
<PAGE> 46
(d) promptly upon the mailing thereof to the shareholders
of the Company generally, copies of all financial statements,
reports and proxy statements so mailed.
(e) as soon as possible, and in any event within ten days
after the Company knows or has reason to know that any of the
events or conditions specified below with respect to any Plan or
Multiemployer Plan of the Company have occurred or exist, a
statement signed by a senior financial officer of the Company
setting forth details respecting such event or condition and the
action, if any, which the Company or any ERISA Affiliate proposes
to take with respect thereto (and a copy of any report or notice
required to be filed with or given to PBGC by the Company or such
ERISA Affiliate with respect to such event or condition):
(i) any reportable event, as defined in
Section 4043(b) of ERISA and the regulations issued
thereunder, with respect to a Plan, as to which PBGC has not
by regulation waived the requirement of Section 4043(a) of
ERISA that it be notified within 30 days of the occurrence
of such event (provided that a failure to meet the minimum
funding standard of Section 412 of the Code or Section 302
of ERISA shall be a reportable event regardless of the
issuance of any waivers in accordance with Section 412(d) of
the Code);
(ii) the filing under Section 4041 of ERISA of a notice
of intent to terminate any Plan or the termination of any
Plan if at the date of such filing or termination the fair
market value of the assets of such Plan, as determined by
the Plan's independent actuaries, is exceeded by the present
value as determined by such actuaries as of such date, of
benefit commitments under such Plan by more than $5,000,000
(including any prior terminations subject to this
provision);
(iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan of the
Company, of the receipt by the Company or any
ERISA Affiliate of a notice from a Multiemployer Plan that
such action has been taken by PBGC with respect to such
Multiemployer Plan;
(iv) the complete or partial withdrawal by the Company
or any ERISA Affiliate under Section 4201 or 4204 of ERISA
from a Multiemployer Plan causing any withdrawal liability
in excess of $2,500,000 (including any prior withdrawals
subject to this provision), or the receipt by the Company or
any ERISA Affiliate of notice from a Multiemployer Plan that
it is in reorganization or insolvency pursuant to
Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of ERISA;
and
<PAGE> 47
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against the Company or any ERISA
Affiliate to enforce Section 515 of ERISA, which proceeding
is not dismissed within 30 days.
(f) promptly after the Company knows or has reason to know
that any Default has occurred, a notice of such Default,
describing the same in reasonable detail.
(g) from time to time such other information regarding the
business, affairs or financial condition of the Company or any of
its Subsidiaries (including, without limitation, any Plan or
Multiemployer Plan and any reports or other information required
to be filed under ERISA) as any Bank or the Administrative Agent
may reasonably request.
The Company will furnish to each Bank, at the time it furnishes each
set of financial statements pursuant to paragraph (a) or (b) above, a
certificate of a senior financial officer of the Company (i) to the
effect that no Default has occurred and is continuing (or, if any
Default has occurred and is continuing, describing the same in
reasonable detail) and (ii) setting forth in reasonable detail the
computations necessary to determine whether the Company is in
compliance with Sections 8.06, 8.07(a)(vii), 8.08(xiii) and 8.11
hereof as of the end of the respective fiscal quarter or fiscal year.
8.02 LITIGATION. The Company shall promptly give to each
Bank notice of all legal or arbitral proceedings, and of all
proceedings before any governmental or regulatory authority or agency,
instituted, or (to the knowledge of the Company) threatened, against
the Company or any of its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect.
8.03 CORPORATE EXISTENCE, ETC. The Company shall, and
shall cause each of its Significant Subsidiaries to: preserve and
maintain its corporate existence and all its material rights,
privileges and franchises (except as otherwise expressly permitted
under Section 8.07 hereof); comply with the requirements of all
applicable laws, rules, regulations and orders of governmental or
regulatory authorities if failure to comply with such requirements
would have a Material Adverse Effect; pay and discharge all taxes,
assessments and governmental charges or levies imposed on it or on its
income or profits or on any of its property prior to the date on which
penalties attach thereto, except for any such tax, assessment, charge
or levy the payment of which is being contested in good faith and by
proper proceedings and against which adequate reserves are being
maintained; maintain all its properties used or useful in its business
in good working order and condition, ordinary wear and tear excepted;
and permit representatives of any Bank or the Administrative Agent,
during normal business hours, to examine, copy and make extracts from
its books and records, to inspect its properties, and to discuss its
business and affairs with its officers, all to the extent reasonably
requested by such Bank or the Administrative Agent (as the case may
be).
<PAGE> 48
8.04 INSURANCE. The Company shall, and shall cause each of
its Subsidiaries to, keep insured by financially sound and reputable
insurers all property of a character usually insured by corporations
engaged in the same or similar business similarly situated against
loss or damage of the kinds and in the amounts customarily insured
against by such corporations and carry such other insurance as is
usually carried by such corporations.
8.05 USE OF PROCEEDS. The proceeds of the Credit
Extensions hereunder will be used solely for general corporate
purposes, including (without limitation) commercial paper back-up and
acquisitions (each of which uses shall be in compliance with all
applicable legal and regulatory requirements, including, without
limitation, Regulations G, U and X of the Board of Governors of the
Federal Reserve System and the Securities Act of 1933, as amended, and
the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder). The Company will not permit more than 25% of
the value (as determined by any reasonable method) of its assets, nor
more than 25% of the value (as determined by any reasonable method) of
the assets of the Company and its Subsidiaries, to be represented by
margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System).
8.06 INDEBTEDNESS. The Company will not, nor will it
permit any of its Subsidiaries to, incur, assume or suffer to exist
obligations in respect of standby and performance letters of credit in
an aggregate amount exceeding 5% of Total Consolidated Assets at any
one time outstanding. The Company will not permit any of its
Subsidiaries to create, issue, incur or assume, or suffer to exist,
any Indebtedness, except: (i) Indebtedness existing on the
Restatement Date, but not any renewals, extensions or refinancings of
the same; (ii) Indebtedness owing to the Company; (iii) Indebtedness
of any Person that becomes a Subsidiary of the Company after the
Restatement Date so long as such Indebtedness exists at the time such
Person becomes such a Subsidiary and was not incurred in anticipation
thereof; (iv) Capital Lease Obligations in an aggregate amount not to
exceed an amount equal to 5% of Total Consolidated Assets at any one
time outstanding; (v) Indebtedness in respect of Committed Loans under
this Agreement; and (vi) additional Indebtedness in an aggregate
amount not to exceed an amount equal to 15% of Total Consolidated
Assets at any one time outstanding.
8.07 FUNDAMENTAL CHANGES.
(a) The Company will not, and will not permit any of its
Subsidiaries to, be a party to any merger or consolidation, and the
Company will not, and will not permit any of its Subsidiaries or
operating divisions (whether now owned or existing or hereafter
acquired or designated) to, (x) sell, assign, lease or otherwise
dispose of all or substantially all of its Property whether now owned
or hereafter acquired or (y) sell, assign or otherwise dispose of any
capital stock of any such Subsidiary, or permit any such Subsidiary to
issue any capital stock, to any Person other than the Company or any
of its
<PAGE> 49
Wholly-Owned Subsidiaries if, after giving effect thereto, the Company
does not own, directly or indirectly, a majority of the capital stock
of such Subsidiary ("CONTROLLING STOCK DISPOSITION"); except that, so
long as both before and after giving effect thereto no Default shall
have occurred and be continuing:
(i) the Company or any Subsidiary of the Company may be a
party to any merger or consolidation if it shall be the surviving
corporation;
(ii) any such Subsidiary may be a party to any merger or
consolidation with another such Subsidiary (or with any Person
that becomes another such Subsidiary as a result of such merger
or consolidation);
(iii) any such Subsidiary may merge into, and any such
Subsidiary or operating division may transfer any Property to,
the Company;
(iv) any such Subsidiary or operating division may transfer
any Property to another such Subsidiary or operating division (or
to any Person that becomes as part of such transfer another such
Subsidiary or operating division);
(v) [Intentionally Omitted];
(vi) the Company, any such Subsidiary or operating division
may sell, assign, lease or otherwise dispose of any Non-Strategic
Property; and
(vii) the Company or any such Subsidiary or operating
division may make sales, assignments and other dispositions of
Property (including Controlling Stock Dispositions) and any such
Subsidiary may become a party to a merger or consolidation (each
such sale, assignment, disposition, Controlling Stock
Disposition, merger or consolidation, other than those described
in clauses (i) through (vi) hereof, a "DISPOSITION") if the
Property that was the subject of any such Disposition, together
with the Property that was the subject of all Dispositions during
the Disposition Period for such Disposition, did not produce
revenue that was greater in amount than an amount equal to 10% of
the revenue of the Company and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP)
for the twelve-month period ending on the Determination Date for
such Disposition (for which purpose, a Controlling Stock
Disposition with respect to any such Subsidiary shall be deemed
to be the disposition of Property of such Subsidiary that
produced all of the revenues of such Subsidiary).
(b) Notwithstanding anything in clauses (i)-(vii) of
Section 8.07(a) hereof to the contrary:
(i) the Company will not, and will not permit any of its
Subsidiaries or operating divisions (whether now owned or
existing or hereafter acquired or designated) to, sell, lease,
<PAGE> 50
assign, transfer or otherwise dispose of (whether in one
transaction or in a series of transactions) any of its Property
(whether now owned or hereafter acquired) if such sale,
assignment, lease or other disposition (whether in one
transaction or in a series of transactions) shall have a Material
Adverse Effect; and
(ii) no Wholly-Owned Subsidiary of the Company shall be a
party to any merger or consolidation with, or shall sell, lease,
assign, transfer or otherwise dispose of any substantial part of
its Property to, any Subsidiary of the Company that is not a
Wholly-Owned Subsidiary of the Company.
8.08 LIENS. The Company shall not, and shall not permit
any of its Subsidiaries to, create, assume or suffer to exist any Lien
upon any of its property or assets, now owned or hereafter acquired,
securing any Indebtedness or other obligation except: (i) Liens
outstanding on the Restatement Date and listed in Schedule II hereto;
(ii) Liens for taxes or other governmental charges not yet delinquent;
(iii) Liens in respect of Property acquired or constructed or improved
by the Company or any such Subsidiary after the Restatement Date which
Liens exist or are created at the time of acquisition or completion of
construction or improvement of such Property or within six months
thereafter to secure Indebtedness assumed or incurred to finance all
or any part of the purchase price or cost of construction or
improvement of such Property, but any such Lien shall cover only the
Property so acquired or constructed and any improvements thereto (and
any real property on which such Property is located); (iv) Liens on
Property of any corporation that becomes a Subsidiary of the Company
after the Restatement Date, provided that such Liens are in existence
at the time such corporation becomes a Subsidiary of the Company and
were not created in anticipation thereof; (v) Liens on Property
acquired after the Restatement Date, provided that such Liens were in
existence at the time such Property was acquired and were not created
in anticipation thereof; (vi) Liens imposed by law, such as mechanics,
materialmen, landlords, warehousemen and carriers Liens, and other
similar Liens, securing obligations incurred in the ordinary course of
business which are not past due for more than thirty days or which are
being contested in good faith by appropriate proceedings and for which
appropriate reserves have been established; (vii) Liens under
workmen's compensation, unemployment insurance, social security or
similar legislation; (viii) Liens, deposits, or pledges to secure the
performance of bids, tenders, contracts (other than contracts for the
payment of money), leases, public or statutory obligations, surety,
stay, appeal, indemnity, performance or other similar bonds, or other
similar obligations arising in the ordinary course of business;
(ix) judgment and other similar Liens arising in connection with court
proceedings, provided the execution or other enforcement of such Liens
is effectively stayed and the claims secured thereby are being
actively contested in good faith and by appropriate proceedings;
(x) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate, do not materially interfere with
the occupation, use and enjoyment by the Company or any such
Subsidiary of the Property encumbered thereby in the normal course of
its business or materially impair the value of the Property subject
<PAGE> 51
thereto; (xi) Liens securing obligations of any such Subsidiary to the
Company or another Subsidiary of the Company; (xii) Liens securing
obligations of the Company pursuant to Receivables Sale Agreements;
and (xiii) other Liens securing Indebtedness in an aggregate amount
which does not exceed 5% of Total Consolidated Assets.
8.09 LINES OF BUSINESSES. Neither the Company nor any of
its Subsidiaries shall engage to any significant extent in any line or
lines of business other than the lines of business in which they are
engaged on the Restatement Date and any other line or lines of
business directly related to the manufacture, distribution and/or sale
of consumer or industrial products (collectively, "PERMITTED
ACTIVITIES"). Notwithstanding the foregoing, the Company and its
Subsidiaries may engage in other lines of business as a result of the
acquisition of any Person primarily engaged in Permitted Activities so
long as the Company uses its best efforts to come into compliance with
the first sentence of this Section 8.09 within a reasonable period of
time after such acquisition.
8.10 [Intentionally omitted].
8.11 TOTAL INDEBTEDNESS TO TOTAL CAPITAL. The Company
shall not permit the ratio of Total Indebtedness to Total Capital at
any time to be greater than 0.65 to 1.
SECTION 9. EVENTS OF DEFAULT. If one or more of the
following events (herein called "EVENTS OF DEFAULT") shall occur and
be continuing:
(a) Any Borrower shall default in the payment when due of
any principal of or interest on any Loan or any other amount
payable by it hereunder; or
(b) The Company or any of its Subsidiaries shall default in
the payment when due of any principal of or interest on any of
its other Indebtedness aggregating $25,000,000 or more; or any
event specified in any note, agreement, indenture or other
document evidencing or relating to any Indebtedness aggregating
$25,000,000 or more shall occur if the effect of such event is to
cause, or (with the giving of any notice or the lapse of time or
both) to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause,
such Indebtedness to become due prior to its stated maturity or
to permit termination of the commitment to lend pursuant to any
such instrument or agreement; or
(c) Any representation, warranty or certification made or
deemed made by the Company herein or in any Designation Letter or
by the Company in any certificate furnished to any Bank or the
Administrative Agent pursuant to the provisions hereof or
thereof, shall prove to have been false or misleading as of the
time made or furnished in any material respect; or
(d) The Company shall default in the performance of any of
its obligations under Section 8.01(f) or 8.05 through 8.11
<PAGE> 52
(inclusive) hereof; or the Company shall default in the
performance of any of its other obligations in this Agreement and
such default shall continue unremedied for a period of 30 days
after notice thereof to the Company by the Administrative Agent
or any Bank (through the Administrative Agent); or
(e) The Company or any of its Significant Subsidiaries
shall admit in writing its inability to, or be generally unable
to, pay its debts as such debts become due; or
(f) The Company or any of its Significant Subsidiaries
shall (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, trustee or
liquidator of itself or of all or a substantial part of its
property, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the Bankruptcy
Code (as now or hereafter in effect), (iv) file a petition
seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, winding-up, or
composition or readjustment of debts, (v) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the
Bankruptcy Code, or (vi) take any corporate action for the
purpose of effecting any of the foregoing; or
(g) A proceeding or case shall be commenced against the
Company or any of its Significant Subsidiaries without its
application or consent, in any court of competent jurisdiction,
seeking (i) its liquidation, reorganization, dissolution or
winding-up, or the composition or readjustment of its debts,
(ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of it or of all or any substantial part of
its assets, or (iii) similar relief in respect of it under any
law relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts, and such
proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing
shall be entered and continue unstayed and in effect, for a
period of 60 days; or an order for relief against it shall be
entered in an involuntary case under the Bankruptcy Code; or
(h) A final judgment or judgments for the payment of money
in excess of $20,000,000 in the aggregate shall be rendered by a
court or courts against the Company and/or any of its
Subsidiaries and the same shall not be discharged (or provision
shall not be made for such discharge), or a stay of execution
thereof shall not be procured, within 30 days from the date of
entry thereof and the Company or the relevant Subsidiary shall
not, within said period of 30 days, or such longer period during
which execution of the same shall have been stayed, appeal
therefrom and cause the execution thereof to be stayed during
such appeal; or
(i) An event or condition specified in Section 8.01(e)
hereof shall occur or exist with respect to any Plan or Multi-
<PAGE> 53
employer Plan of the Company and, as a result of such event or
condition, together with all other such events or conditions, the
Company or any ERISA Affiliate shall incur or in the opinion of
the Majority Banks shall be reasonably likely to incur a
liability to a Plan, a Multiemployer Plan or PBGC (or any
combination of the foregoing) which is, in the determination of
the Majority Banks, material in relation to the consolidated
financial position of the Company and its Subsidiaries (taken as
a whole); or
(j) During any period of 25 consecutive calendar months
(i) individuals who were directors of the Company on the first
day of such period and (ii) other individuals whose election or
nomination to the Board of Directors of the Company was approved
by at least a majority of the individuals referred to in clause
(i) above and (iii) other individuals whose election or
nomination to the Board of Directors of the Company was approved
by at least a majority of the individuals referred to in clauses
(i) and (ii) above shall no longer constitute a majority of the
Board of Directors of the Company;
THEREUPON: (i) in the case of an Event of Default (other than one
referred to in clause (f) or (g) of this Section 9 in respect of the
Company) (x) the Administrative Agent may and, upon request of the
Majority Banks, shall, by notice to the Company, cancel the
Commitments and (y) the Administrative Agent may and, upon request of
Banks holding at least 66-2/3% of the aggregate unpaid principal
amount of Loans then outstanding shall, by notice to the Company,
declare the principal amount of and the accrued interest on the Loans,
and all other amounts payable by the Company or any other Borrower
hereunder and under the Notes, to be forthwith due and payable,
whereupon such amounts shall be immediately due and payable without
presentment, demand, protest or other formalities of any kind, all of
which are hereby expressly waived by the Company and each other
Borrower; and (ii) in the case of the occurrence of an Event of
Default referred to in clause (f) or (g) of this Section 9 in respect
of the Company, the Commitments shall be automatically cancelled and
the principal amount then outstanding of, and the accrued interest on,
the Loans and all other amounts payable by the Company or any other
Borrower hereunder and under the Notes shall become automatically
immediately due and payable without presentment, demand, protest or
other formalities of any kind, all of which are hereby expressly
waived by the Company and each other Borrower.
In addition, in the case of the occurrence of any event of
the type referred to in clause (f) or (g) of this Section 9 in respect
of any Designated Borrower, the principal amount then outstanding of,
and accrued interest on, the Loans and other amounts payable by such
Designated Borrower hereunder and under its Notes shall automatically
become immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby
expressly waived by such Designated Borrower and the Company.
SECTION 10. THE ADMINISTRATIVE AGENT.
<PAGE> 54
10.01 APPOINTMENT, POWERS AND IMMUNITIES. Each Bank hereby
irrevocably (but subject to Section 10.08 hereof) appoints and
authorizes the Administrative Agent to act as its agent hereunder with
such powers as are specifically delegated to the Administrative Agent
by the terms of this Agreement together with such other powers as are
reasonably incidental thereto. The Administrative Agent (which term
as used in this sentence and in Section 10.05 and the first sentence
of Section 10.06 hereof shall include reference to its Affiliates and
its own and its affiliates' officers, directors, employees and
agents): (a) shall have no duties or responsibilities except those
expressly set forth in this Agreement and shall not by reason of this
Agreement be a trustee for any Bank; (b) shall not be responsible to
the Banks for any recitals, statements, representations or warranties
contained in this Agreement or in any certificate or other document
referred to or provided for in, or received by any of them under, this
Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement, any Note or any other
document referred to or provided for herein or for any failure by the
Company or any other Person to perform any of its obligations
hereunder or thereunder; (c) shall not be required to initiate or
conduct any litigation or collection proceedings hereunder; and
(d) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith, except
for its own gross negligence or willful misconduct. The
Administrative Agent may employ agents and attorneys-in-fact and shall
not be responsible for the negligence or misconduct of any such agents
or attorneys-in-fact selected by it with reasonable care.
10.02 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative
Agent shall be entitled to rely upon any certification, notice or
other communication (including any thereof by telephone, telex,
telegram or cable) believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent.
As to any matters not expressly provided for by this Agreement, the
Administrative Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder in accordance with
instructions signed by the Majority Banks, and such instructions of
the Majority Banks and any action taken or failure to act pursuant
thereto shall be binding on all the Banks.
10.03 DEFAULTS. The Administrative Agent shall not be
deemed to have knowledge of the occurrence of a Default unless the
Administrative Agent has received notice from a Bank or the Company
specifying such Default and stating that such notice is a "Notice of
Default". In the event that the Administrative Agent receives such a
notice of the occurrence of a Default, the Administrative Agent shall
give prompt notice thereof to the Banks. The Administrative Agent
shall (subject to Section 10.07 hereof) take such action with respect
to such Default as shall be directed by the Majority Banks, provided
that, unless and until the Administrative Agent shall have received
such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action,
<PAGE> 55
with respect to such Default as it shall deem advisable in the best
interest of the Banks.
10.04 RIGHTS AS A BANK. With respect to its Commitment and
the Loans made by it, Chase (and any successor acting as
Administrative Agent), in its capacity as a Bank hereunder shall have
the same rights and powers hereunder as any other Bank and may
exercise the same as though it were not acting as the Administrative
Agent, and the term "Bank" or "Banks" shall, unless the context
otherwise indicates, include the Administrative Agent in its
individual capacity. Chase (and any successor acting as
Administrative Agent) and its Affiliates may (without having to
account therefor to any Bank) accept deposits from, lend money to and
generally engage in any kind of banking, trust or other business with
the Company (and any of its affiliates) as if it were not acting as
the Administrative Agent, and Chase and its Affiliates may accept fees
and other consideration from the Company for services in connection
with this Agreement or otherwise without having to account for the
same to the Banks.
10.05 INDEMNIFICATION. The Banks agree to indemnify the
Administrative Agent (to the extent not reimbursed under Section 12.03
hereof, but without limiting the obligations of the Company under said
Section 12.03), ratably in accordance with their respective
Commitments, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against the Administrative Agent in any
way relating to or arising out of this Agreement or any other
documents contemplated by or referred to herein or the transactions
contemplated hereby (including, without limitation, the costs and
expenses which the Company is obligated to pay under Section 12.03
hereof but excluding, unless a Default has occurred and is continuing,
normal administrative costs and expenses incident to the performance
of its agency duties hereunder) or the enforcement of any of the terms
hereof, or of any such other documents, provided that no Bank shall be
liable for any of the foregoing to the extent they arise from the
gross negligence or willful misconduct of the party to be indemnified.
10.06 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER BANKS.
Each Bank agrees that it has, independently and without reliance on
the Administrative Agent or any other Bank, and based on such
documents and information as it has deemed appropriate, made its own
credit analysis of the Company and its Subsidiaries and decision to
enter into this Agreement and that it will, independently and without
reliance upon the Administrative 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 analysis and decisions in taking or not
taking action under this Agreement. The Administrative Agent shall
not be required to keep itself informed as to the performance or
observance by any Obligor of this Agreement or any other document
referred to or provided for herein or to inspect the properties or
books of the Company or any Subsidiary of the Company. Except for
notices, reports and other documents and information expressly
required to be furnished to the Banks by the Administrative Agent
<PAGE> 56
hereunder, the Administrative Agent shall not have any duty or
responsibility to provide any Bank with any credit or other
information concerning the affairs, financial condition or business of
the Company or any Subsidiary of the Company (or any of their
affiliates) which may come into the possession of the Administrative
Agent or any of its Affiliates.
10.07 FAILURE TO ACT. Except for action expressly required
of the Administrative Agent hereunder the Administrative Agent shall
in all cases be fully justified in failing or refusing to act
hereunder unless it shall be indemnified to its satisfaction by the
Banks against any and all liability and expense which may be incurred
by it by reason of taking or continuing to take any such action.
10.08 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, the Administrative Agent may
resign at any time by giving notice thereof to the Banks and the
Company and the Administrative Agent may be removed at any time with
or without cause by the Majority Banks. Upon any such resignation or
removal, the Majority Banks shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent
shall have been so appointed by the Majority Banks and shall have
accepted such appointment within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Majority
Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be a bank which has an office in New
York, New York with a combined capital and surplus of at least
$100,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent,
such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of
the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder.
After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Section 10
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 the
Administrative Agent.
SECTION 11. GUARANTEE.
11.01 GUARANTEE. The Company hereby guarantees to each
Bank and the Administrative Agent and their respective successors and
assigns the prompt payment in full when due (whether at stated
maturity, by acceleration, by optional prepayment or otherwise) of the
principal of and interest on the Loans made by the Banks to, and the
Notes held by each Bank of, any Designated Borrower and all other
amounts from time to time owing to the Banks or the Administrative
Agent by any Designated Borrower under this Agreement pursuant to its
Designation Letter and under the Notes, in each case strictly in
accordance with the terms thereof (such obligations being herein
collectively called the "GUARANTEED OBLIGATIONS"). The Company hereby
further agrees that if any Designated Borrower shall fail to pay in
<PAGE> 57
full when due (whether at stated maturity, by acceleration, by
optional prepayment or otherwise) any of the Guaranteed Obligations,
the Company will promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment
or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by
acceleration or otherwise) in accordance with the terms of such
extension or renewal.
11.02 OBLIGATIONS UNCONDITIONAL. The obligations of the
Company hereunder are unconditional irrespective of (a) the value,
genuineness, validity, regularity or enforceability of any of the
Guaranteed Obligations, (b) any modification, amendment or variation
in or addition to the terms of any of the Guaranteed Obligations or
any covenants in respect thereof or any security therefor, (c) any
extension of time for performance or waiver of performance of any
covenant of any Designated Borrower or any failure or omission to
enforce any right with regard to any of the Guaranteed Obligations,
(d) any exchange, surrender, release of any other guaranty of or
security for any of the Guaranteed Obligations, or (e) any other
circumstance with regard to any of the Guaranteed Obligations which
may or might in any manner constitute a legal or equitable discharge
or defense of a surety or guarantor, it being the intent hereof that
the obligations of the Company hereunder shall be absolute and
unconditional under any and all circumstances.
The Company hereby expressly waives diligence, presentment,
demand, protest, and all notices whatsoever with regard to any of the
Guaranteed Obligations and any requirement that the Administrative
Agent or any Bank exhaust any right, power or remedy or proceed
against any Designated Borrower hereunder or under the Designation
Letter of such Designated Borrower or any Note of such Designated
Borrower or any other guarantor of or any security for any of the
Guaranteed Obligations.
11.03 REINSTATEMENT. The guarantee in this Section 11
shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of any Designated Borrower in
respect of the Guaranteed Obligations is rescinded or must be
otherwise restored by any holder(s) of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise.
11.04 SUBROGATION. Until the termination of the
Commitments and the payment in full of the principal of and interest
on the Loans and all other amounts payable to the Administrative Agent
or any Bank hereunder, the Company hereby irrevocably waives all
rights of subrogation or contribution, whether arising by operation of
law (including, without limitation, any such right arising under the
Federal Bankruptcy Code) or otherwise, by reason of any payment by it
pursuant to the provisions of this Section 11.
11.05 REMEDIES. The Company agrees that, as between the
Company on the one hand and the Banks and the Administrative Agent on
the other hand, the obligations of any Designated Borrower guaranteed
<PAGE> 58
under this Agreement may be declared to be forthwith due and payable,
or may be deemed automatically to have been accelerated, as provided
in Section 9 hereof, for purposes of Section 11.01 hereof
notwithstanding any stay, injunction or other prohibition (whether in
a bankruptcy proceeding affecting such Designated Borrower or
otherwise) preventing such declaration as against such Designated
Borrower and that, in the event of such declaration or automatic
acceleration such obligations (whether or not due and payable by such
Designated Borrower) shall forthwith become due and payable by the
Company for purposes of said Section 11.01.
11.06 CONTINUING GUARANTEE. The guarantee in this Section
11 is a continuing guarantee and shall apply to all Guaranteed
Obligations whenever arising.
SECTION 12. MISCELLANEOUS.
12.01 WAIVER. No failure on the part of the Administrative
Agent or any Bank to exercise and no delay in exercising, and no
course of dealing with respect to, any right, power or privilege under
this Agreement, any Designation Letter or any Note shall operate as a
waiver thereof, nor shall any single or partial exercise of any right,
power or privilege under this Agreement, any Designation Letter or any
Note preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The remedies provided herein and
therein are cumulative and not exclusive of any remedies provided by
law.
12.02 NOTICES. All notices and other communications
provided for herein (including, without limitation, any modifications
of, or requests, demands, waivers or consents under, this Agreement)
shall be given or made by telex, telecopy, telegraph, cable or in
writing and telexed, telecopied, telegraphed, cabled, mailed or
delivered to the intended recipient at (i) in the case of the Company
or the Administrative Agent, the "Address for Notices" specified below
its name on the signature pages hereof and (ii) in the case of each
Bank, the address (or telecopy) set forth in its Administrative
Questionnaire; or, as to any party, at such other address as shall be
designated by such party in a notice to each other party. Except as
otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telex or
telecopier, delivered to the telegraph or cable office or personally
delivered or, in the case of a mailed notice, upon receipt, in each
case given or addressed as aforesaid. Each Designated Borrower hereby
agrees that each notice or other communication provided for herein may
be furnished to the Company or by the Company on its behalf in the
manner specified above and each Designated Borrower further agrees
that failure of the Company to deliver to such Designated Borrower any
notice furnished in accordance with this Section 12.02 shall not
affect the validity of such notice.
12.03 EXPENSES, ETC. The Company agrees to pay or
reimburse each of the Banks and the Administrative Agent for paying:
(a) the reasonable fees and expenses of Milbank, Tweed, Hadley &
McCloy, special New York counsel to the Banks and the Administrative
<PAGE> 59
Agent, in connection with (i) the preparation, execution and delivery
of this Agreement, the Designation Letters and the Notes, the making
of the Loans hereunder and (ii) any amendment, modification or waiver
(whether or not such amendment, modification or waiver shall become
effective) of any of the terms of this Agreement or any of the Notes;
(b) all reasonable costs and expenses of the Banks and the
Administrative Agent (including reasonable counsels' fees) in
connection with the enforcement of this Agreement, any Designation
Letter or any of the Notes; and (c) all transfer, stamp, documentary
or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement, any
Designation Letter, any of the Notes or any other document referred to
herein.
The Company hereby agrees to indemnify the Administrative
Agent and each Bank and their respective directors, officers,
employees and agents from, and hold each of them harmless against, any
and all losses, liabilities, claims, damages, costs, expenses, taxes
or penalties incurred by any of them arising out of, by reason of or
as a consequence of (i) any representation or warranty made or deemed
to be made by the Company in Section 7 hereof or in any Designation
Letter proving to have been false or misleading as of the time made in
any material respect or (ii) any investigation or litigation or other
proceedings (including any threatened investigation or litigation or
other proceedings) relating to any actual or proposed use by the
Company or any Subsidiary of the Company of the proceeds of any of the
Loans, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such
investigation or litigation or other proceedings (but excluding any
such losses, liabilities, claims, damages, costs, expenses, taxes or
penalties incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified).
12.04 AMENDMENTS, ETC. Except as otherwise expressly
provided in this Agreement, any provision of this Agreement may be
amended or modified only by an instrument in writing signed by the
Company, the Administrative Agent and the Majority Banks, or by the
Company, and the Administrative Agent acting with the consent of the
Majority Banks, and any provision of this Agreement may be waived by
the Majority Banks or by the Administrative Agent acting with the
consent of the Majority Banks; provided that no amendment,
modification or waiver shall, unless by an instrument signed by all of
the Banks or by the Administrative Agent acting with the consent of
all of the Banks: (i) increase or extend the term, or extend the time
or waive any requirement for the reduction or termination, of the
Commitments, (ii) extend the date fixed for the payment of any
principal of or interest on any Loan, (iii) reduce the amount of any
principal of any Loan or the rate at which interest or any fee is
payable hereunder, (iv) alter the terms of Section 11 hereof or
release the Company from any of its obligations thereunder, (v) alter
the terms of this Section 12.04, (vi) amend the definition of the term
"Majority Banks" or modify in any other manner the number or
percentage of the Banks required to make any determinations or waive
any rights hereunder or to modify any provision hereof, (vii) amend
the definition of the term "Alternative Currency" or (viii) waive any
<PAGE> 60
of the conditions precedent set forth in Section 6 hereof; and
provided, further, that any amendment of Section 10 hereof, or which
increases the obligations or alters the rights of the Administrative
Agent hereunder, shall require the consent of the Administrative
Agent.
12.05 ASSIGNMENTS AND PARTICIPATIONS.
(a) No Obligor may assign any of its rights or obligations
hereunder or under the Notes without the prior consent of all of
the Banks and the Administrative Agent.
(b) No Bank may assign all or any part of its Loans, its
Notes or its Commitment without the prior consent of the Company
and the Administrative Agent, which consents will not be
unreasonably withheld; provided that, (i) without the consent of
the Company or the Administrative Agent, any Bank may assign to
any of its Affiliates or to another Bank all or (subject to the
further clauses below) any portion of its Commitment; (ii) any
such partial assignment shall be not less than $5,000,000 and in
multiples of $1,000,000 in excess thereof; and (iii) such
assigning Bank shall also simultaneously assign the same
proportion of each of its Committed Loans then outstanding. Upon
written notice to the Company and the Administrative Agent of an
assignment permitted by the preceding sentence (which notice
shall identify the assignee, the amount of the assigning Bank's
Commitment and Loans assigned in detail reasonably satisfactory
to the Administrative Agent) and upon the effectiveness of any
assignment consented to by the Company and the Administrative
Agent, the assignee shall have, to the extent of such assignment
(unless otherwise provided in such assignment with the consent of
the Company and the Administrative Agent), the obligations,
rights and benefits of a Bank hereunder holding the Commitment
and Loans (or portions thereof) assigned to it (in addition to
the Commitment and Loans, if any, theretofore held by such
assignee) and the assigning Bank shall, to the extent of any such
Commitment assignment, be released from its Commitment (or
portions thereof) so assigned. Upon the effectiveness of any
assignment referred to in this Section 12.05(b), the assigning
Bank or the assignee Bank shall pay to the Administrative Agent a
transfer fee in an amount equal to $3,000.
(c) A Bank may sell or agree to sell to one or more other
Persons a participation in all or any part of its Commitment or
its Loans, in which event each such participant shall be entitled
to the rights and benefits of the provisions of Section 8.01(g)
hereof with respect to its participation as if (and the Company
shall be directly obligated to such participant under such
provisions as if) such participant were a "Bank" for purposes of
said Section, but shall not have any other rights or benefits
under this Agreement or such Bank's Notes (the participant's
rights against such Bank in respect of such participation to be
those set forth in the agreement (the "PARTICIPATION AGREEMENT")
executed by such Bank in favor of the participant). All amounts
payable by the Company to any Bank under Section 5 hereof shall
<PAGE> 61
be determined as if such Bank had not sold or agreed to sell any
participations and as if such Bank were funding all of its Loans
in the same way that it is funding the portion of its Loans in
which no participations have been sold. In no event shall a Bank
that sells a participation be obligated to the participant under
the Participation Agreement to take or refrain from taking any
action hereunder or under such Bank's Notes except that such Bank
may agree in the Participation Agreement that it will not,
without the consent of the participant, agree to (i) the
increase, or the extension of the term, or the extension of the
time or waiver of any requirement for the reduction or
termination, of such Bank's Commitment, (ii) the extension of any
date fixed for the payment of principal of or interest on any
participated Loan or any portion of any fees payable to the
participant, (iii) the reduction of any payment of principal of
any participated Loan, (iv) the reduction of the rate at which
either interest or (if the participant is entitled to any part
thereof) fees are payable hereunder to a level below the rate at
which the participant is entitled to receive interest or fees (as
the case may be) in respect of such participation or (v) any
modification, supplement or waiver hereof or of any of the other
Basic Documents to the extent that the same, under the terms
hereof or thereof, requires the consent of each Bank.
(d) In addition to the assignments and participations
permitted under the foregoing provisions of this Section 12.05, a
Bank may assign and pledge all or any portion of its Loans and
its Notes to any Federal Reserve Bank as collateral security
pursuant to Regulation A and any Operating Circular issued by
such Federal Reserve Bank. No such assignment shall release the
Bank from its obligations hereunder.
(e) A Bank may furnish any information concerning the
Company or any of its Subsidiaries in the possession of such Bank
from time to time to assignees and participants (including
prospective assignees and participants).
12.06 SURVIVAL. The obligations of any Borrower under
Sections 5.01, 5.05 and 5.06 hereof, the obligations of the Banks
under Section 10.05 hereof and the obligations of the Company under
Section 12.03 hereof shall survive the repayment of the Loans and the
termination of the Commitments. In addition, each representation and
warranty made, or deemed to be made, by a notice of borrowing of Loans
hereunder shall survive the making of such Loans, and no Bank shall be
deemed to have waived, by reason of making any Loan, any Default or
Event of Default which may arise by reason of such representation or
warranty proving to have been false or misleading, notwithstanding
that such Bank or the Administrative Agent may have had notice or
knowledge or reason to believe that such representation or warranty
was false or misleading at the time such Loan was made.
12.07 CAPTIONS. Captions and section headings appearing
herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this
Agreement.
<PAGE> 62
12.08 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be identical and all of
which, when taken together, shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement
by signing any such counterpart.
12.09 GOVERNING LAW; JURISDICTION; SERVICE OF PROCESS;
WAIVER OF JURY TRIAL; ETC.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY, AND ANY ACTION OR PROCEEDING TO
EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT OBTAINED IN CONNECTION
THEREWITH, MAY BE INSTITUTED IN THE SUPREME COURT OF THE STATE OF NEW
YORK, COUNTY OF NEW YORK OR IN THE U.S. DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND EACH OBLIGOR IRREVOCABLY AND
UNCONDITIONALLY SUBMITS GENERALLY (BUT NON-EXCLUSIVELY) TO THE
JURISDICTION OF EACH SUCH COURT. THE COMPANY IRREVOCABLY CONSENTS TO
THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES OF SUCH PROCESS TO THE COMPANY AT ITS ADDRESS
SET FORTH UNDERNEATH ITS SIGNATURE HERETO. EACH DESIGNATED BORROWER
HEREBY AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING
BROUGHT IN NEW YORK MAY BE MADE UPON SUCH DESIGNATED BORROWER BY
SERVICE UPON THE COMPANY AT THE "ADDRESS FOR NOTICES" SPECIFIED BELOW
ITS NAME ON THE SIGNATURE PAGES HEREOF AND EACH DESIGNATED BORROWER
HEREBY IRREVOCABLY APPOINTS THE COMPANY AS ITS AUTHORIZED AGENT
("PROCESS AGENT") TO ACCEPT, ON BEHALF OF ITS PROPERTY SUCH SERVICE OF
PROCESS IN NEW YORK. EACH OBLIGOR AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW. EACH OBLIGOR IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH
A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OBLIGOR FURTHER
AGREES THAT ANY SUCH ACTION OR PROCEEDING AGAINST THE ADMINISTRATIVE
AGENT AND/OR ANY OF THE BANKS SHALL BE BROUGHT ONLY IN THE SUPREME
COURT OF THE STATE OF NEW YORK, COUNTY OF NEW YORK OR IN THE U.S.
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND THE
ADMINISTRATIVE AGENT AND THE BANKS HEREBY CONSENT TO THE JURISDICTION
OF SUCH COURTS FOR SUCH PURPOSE.
(b) EACH OF THE OBLIGORS, THE ADMINISTRATIVE AGENT AND THE
BANKS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
12.10 SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
12.11 JUDGMENT CURRENCY. This is an international loan
transaction in which the specification of Dollars or an Alternative
<PAGE> 63
Currency, as the case may be (the "SPECIFIED CURRENCY"), any payment
in New York City or the country of the Specified Currency, as the case
may be (the "SPECIFIED PLACE"), is of the essence, and the Specified
Currency shall be the currency of account in all events relating to
Loans denominated in the Specified Currency. The payment obligations
of the Obligors under this Agreement and the Notes shall not be
discharged by an amount paid in another currency or in another place,
whether pursuant to a judgment or otherwise, to the extent that the
amount so paid on conversion to the Specified Currency and transfer to
the Specified Place under normal banking procedures does not yield the
amount of the Specified Currency at the Specified Place due hereunder.
If for the purpose of obtaining judgment in any court it is necessary
to convert a sum due hereunder in the Specified Currency into another
currency (the "SECOND CURRENCY"), the rate of exchange which shall be
applied shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the Specified
Currency with the Second Currency on the Business Day next preceding
that on which such judgment is rendered. The obligation of each
Obligor in respect of any such sum due from it to the Administrative
Agent or any Bank hereunder (an "ENTITLED PERSON") shall,
notwithstanding the rate of exchange actually applied in rendering
such judgment, be discharged only to the extent that on the Business
Day following receipt by such Entitled Person of any sum adjudged to
be due hereunder or under the Notes in the Second Currency such
Entitled Person may in accordance with normal banking procedures
purchase and transfer to the Specified Place the Specified Currency
with the amount of the Second Currency so adjudged to be due; and each
Obligor hereby, as a separate obligation and notwithstanding any such
judgment, agrees to indemnify such Entitled Person against, and to pay
such Entitled Person on demand in the Specified Currency, any
difference between the sum originally due to such Entitled Person in
the Specified Currency and the amount of the Specified Currency so
purchased and transferred.
12.12 EUROPEAN MONETARY UNION. (a) If, as a result of the
implementation of European monetary union, (i) any European Currency
ceases to be lawful currency of the nation issuing the same and is
replaced by a European common currency (the "EURO"), or (ii) any
European Currency and the Euro are at the same time recognized by any
governmental authority of the nation issuing such European Currency as
lawful currency of such nation and the Administrative Agent or the
Majority Banks shall so request in a notice delivered to the Company,
then any amount payable hereunder by any party hereto in such Currency
shall instead be payable in the Euro and the amount so payable shall
be determined by translating the amount payable in such European
Currency to the Euro at the exchange rate recognized by the European
Central Bank for the purpose of implementing European monetary union.
Prior to the occurrence of the event or events described in clause (i)
or (ii) of the preceding sentence, each amount payable hereunder in
any European Currency will, except as otherwise provided herein,
continue to be payable only in that Currency.
(b) The Company agrees, at the request of any Bank, to
compensate such Bank for any loss, cost, expense or reduction in
return that such Bank shall reasonably determine shall be incurred or
<PAGE> 64
sustained by such Bank as a result of the implementation of European
monetary union and that would not have been incurred or sustained but
for the transactions provided for herein. A certificate of a Bank
setting forth such Bank's determination of the amount or amounts
necessary to compensate such Bank shall be delivered to the Company
and shall be conclusive absent manifest error so long as such
determination is made on a reasonable basis. The Company shall pay
such Bank the amount shown as due on any such certificate within 10
days after receipt thereof.
(c) The parties hereto agree, at the time of or at any time
following the implementation of European monetary union, to use
reasonable efforts to enter into an agreement amending this Agreement
in order to reflect the implementation of such monetary union, to
permit (if feasible) the Euro to qualify as an Alternative Currency
under the terms and conditions of the definition of such term and to
place the parties hereto in the position with respect to the
settlement of payments of the Euro as they would have been with
respect to the settlement of the Currencies it replaced.
12.13 OUTSTANDING LOANS. Any outstanding Money Market
Loans under the Existing Credit Agreement owing to any of the Banks on
the Amendment Effective Date shall be deemed to be Competitive Loans
hereunder. The principal of and accrued interest on all other
outstanding Money Market Loans under the Existing Credit Agreement
shall be repaid in full, together with any amounts owing under Section
5.05 of the Existing Credit Agreement with respect thereto, on the
Amendment Effective Date.
12.14 EXISTING DESIGNATED BORROWERS AND APPROVED DESIGNATED
BORROWERS. The parties hereto hereby acknowledge and agree that, as
of the Amendment Effective Date, (i) Newell Investments, Inc. will
continue to be an Approved Designated Borrower and (ii) the following
Foreign Subsidiaries will continue as Designated Borrowers:
(1) Newell Consumer Products GmbH (formerly Corning
Consumer GmbH);
(2) Newell Holdings U.K. Limited;
(3) Newell Limited (formerly Corning Consumer Limited);
(4) Newell Holdings France S.A.S.;
(5) Newell S.A. (formerly Corning Consumer S.A.);
(6) Newell Industries Canada, Inc.;
(7) Berol Limited;
(8) Newell Holdings Spain S.A.; and
(9) Sani Sweden AB;
<PAGE> 65
in each case until a Termination Letter with respect thereto has been
furnished to the Administrative Agent.
<PAGE> 66
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above
written.
NEWELL CO.
By /s/ C.R. Davenport
---------------------
Name: C.R. Davenport
Title: Vice President-Treasurer
Address for Notices:
Newell Co.
29 East Stephenson Street
Freeport, Illinois 61032
Attn: Ronn L. Claussen,
Assistant Treasurer
Telecopy No.: 815-233-8060
Telephone No.: 815-233-8051
<PAGE> 67
THE ADMINISTRATIVE AGENT
-------------------------
THE CHASE MANHATTAN BANK,
as Administrative Agent
By /s/ Carol A. Ulmer
-------------------------
Name: Carol A. Ulmer
Title: Vice President
Address for Notices:
The Chase Manhattan Bank
Loan and Agency Services Group
1 Chase Manhattan Plaza
8th Floor
New York, New York 10081
Attention: Christina R. Gould
Telecopier No.: (212) 552-5777
Telephone No.: (212) 552-7684
<PAGE> 68
BANKS
-----
THE CHASE MANHATTAN BANK
By /s/ Carol A. Ulmer
-------------------------
Name: Carol A. Ulmer
Title: Vice President
BANK OF AMERICA NATIONAL TRUST
and SAVINGS ASSOCIATION
By /s/ R. Guy Stapleton
-------------------------
Name: R. Guy Stapleton
Title: Managing Director
ROYAL BANK OF CANADA
By /S/ Preston B. Jones
-------------------------
Name: Preston B. Jones
Title: Senior Manager -
Corporate Banking
FIRST NATIONAL BANK OF CHICAGO
By /s/ Sarah Faulkner Pagliane
-----------------------------
Name: Sarah Faulkner Pagliane
Title: Authorized Agent
THE NORTHERN TRUST COMPANY
By /s/ Julie J. Wigdale
--------------------------
Name: Julie J. Wigdale
Title: Vice President
<PAGE> 69
BANQUE NATIONALE DE PARIS
CHICAGO BRANCH
By /s/ Wm. J. Krummen
--------------------------
Name: William J. Krummen
Title: Vice President and
Manager
By /s/ JoEllen Bender
--------------------------
Name: JeEllen Bender
Title: Vice President and
Manager
CIBC INC.
By /s/ David C. Quon
--------------------------
Name: David C. Quon
Title: Managing Director
CIBC Wood Gundy
Securities Corp.,
As Agent
MELLON BANK, N.A.
By /s/ M. James Barry III
------------------------
Name: M. James Barry III
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
By /s/ Richard T. Jander
--------------------------
Name: Richard T. Jander
Title: Vice President
<PAGE> 70
THE BANK OF TOKYO-MITSUBISHI, LTD.
CHICAGO BRANCH
By /s/ Tokutaro Sekine
---------------------------
Name: Tokutaro Sekine
Title: General Manager
WACHOVIA BANK, N.A.
By /s/ Elizabeth Schrock
--------------------------
Name: Elizabeth Schrock
Title: Vice President
COMMERZBANK AKTIENGESELLSCHAFT,
CHICAGO BRANCH
By /s/ Mark Monson
--------------------------
Name: Mark Monson
Title: Vice President
By /s/ Maria Cualoping
--------------------------
Name: Maria Cualoping
Title: Assistant Treasurer
ISTITUTO BANCARIO SAN PAOLO
DI TORINO SPA
By /s/ William DeAngelo
---------------------------
Name: William DeAngelo
Title: First Vice President
<PAGE> 71
By /s/ Carlo Persico
---------------------------
Name: Carlo Persico
Title: Deputy General Manager
SOCIETE GENERALE
By /s/ Eric E.O. Siebert, Jr.
--------------------------------
Name: Eric E.O. Siebert, Jr.
Title: Corporate Banking
Manager - Midwest
By /s/ Steven R. Fercho
-------------------------------
Name: Steven R. Fercho
Title: Vice President
BANK OF NEW YORK
By /s/ John R. Ciulla
--------------------------
Name: John R. Ciulla
Title: Assistant Vice
President
THE DAI-ICHI KANGYO BANK, LTD.,
CHICAGO BRANCH
By /s/ Seiichiro Ino
--------------------------
Name: Seiichiro Ino
Title: Vice President
THE SUMITOMO BANK, LIMITED
By /s/John H. Kemper
-------------------------
Name: John H. Kemper
Title: Senior Vice President
<PAGE> 72
BANCA COMMERCIALE ITALIANA
By /s/ Julian M. Teodori
-----------------------------
Name: Julian M. Teodori
Title: Seniro Vice President
& Manager
By /s/ Matthew A. Trujillo
------------------------------
Name: Matthew A. Trujillo
Title: Vice President
BANCA NATIONALE DEL LAVORO S.p.A.
NEW YORK BRANCH
By /s/ Giuliano Violetta
------------------------------
Name: Giuliano Violetta
Title: First Vice President
By /s/ Roberto Mancone
--------------------------
Name: Roberto Mancone
Title: Ass. Vice President
CREDIT ITALIANO
By /s/ Peiriuigi Malrardi
----------------------------
Name: Peiriuigi Malrardi
Title: Assistant Vice
President
DEN DANSKE BANK
By /s/ Mogens Sondergaard
------------------------------
Name: Mogens Sondergaard
Title: Vice President
<PAGE> 73
By /s/ John O'Neil
------------------------------
Name: John O'Neil
Title: Vice President
FIRSTAR BANK MILWAUKEE, N.A.
By /s/ R. Bruce Anthony
-----------------------------
Name: R. Bruce Anthony
Title: Assistant vice
President
SUN TRUST BANK
By /s/ Christopher H. Colter
-------------------------------
Name: Christopher H. Colter
Title: Banking Officer
By /s/ Linda L. Dash
-------------------------------
Name: Linda L. Dash
Title: Vice President
BANK ONE, ILLINOIS, N.A.
By /s/ Robert J. Louvar
----------------------------
Name: Robert J. Louvar
Title: Vice President
Corporate Banking
<PAGE> 74
Annex I
Commitments
-----------
Bank Commitment
---- ----------
The Chase Manhattan Bank$ 125,000,000.00
Bank of America National Trust and
Savings Association 110,000,000.00
Royal Bank of Canada 110,000,000.00
The First National Bank of Chicago 110,000,000.00
The Northern Trust Company 75,000,000.00
Banque Nationale de Paris,
Chicago Branch 60,000,000.00
CIBC Inc. 60,000,000.00
Mellon Bank, N.A. 60,000,000.00
PNC Bank, N.A. 60,000,000.00
The Bank of Tokyo-Mitsubishi, Ltd.,
Chicago Branch 60,000,000.00
Wachovia Bank, N.A. 60,000,000.00
Commerzbank AG, Chicago Branch 35,000,000.00
Instituto Bancario San Paolo di Torino
S.p.A. 35,000,000.00
Societe Generale 35,000,000.00
The Bank of New York 35,000,000.00
The Dai-Ichi Kangyo Bank, Ltd., Chicago
Branch 35,000,000.00
The Sumitomo Bank, Ltd.,
Chicago Branch 35,000,000.00
Banca Commerciale Italiana 30,000,000.00
Banca Nationale del Lavoro S.p.A., New
York Branch 30,000,000.00
Credito Italiano S.p.A., New York
Branch 30,000,000.00
Den Danske Bank, New York Branch 30,000,000.00
Firstar Bank Milwaukee, N.A. 30,000,000.00
Sun Trust Bank, Atlanta 30,000,000.00
Bank One, Illinois, NA 20,000,000.00
-----------------
Total $1,300,000,000.00
==================
<PAGE> 75 SCHEDULE I
<TABLE>
LIST OF INDEBTEDNESS
Maximum or Outstanding
Lender or Type of Original Amount ($)
Trustee Arrangement Amount ($) As of 6/30/97
--------- ----------- ---------- -------------
NEWELL CO.
<C> <S> <C> <C>
1. The Chase Manhattan Bank Commercial Paper $900,000,000 $846,000,000
2. The Northern Trust Co. Line of Credit 15,000,000 0
3. The Chase Manhattan Bank Line of Credit 250,000,000 250,000,000
4. Sanwa Bank, Ltd. Line of Credit 25,000,000 0
5. Pittsburgh National Bank Discretionary Note 20,000,000 6,000,000
6. Royal Bank of Canada Line of Credit 21,000,000 0
7. Societe Generale Line of Credit 25,000,000 0
8. The Chase Manhattan Bank Medium-Term Notes 0 263,000,000
9. The Chase Manhattan Bank Revolver 900,000,000 0
(as Agent)
10. (All items *) Parent Guarantees
11. The Chase Manhattan Bank Medium-Term Notes 500,000,000 0
(Trustee)
STUART HALL COMPANY, INC.
1. See Schedule II
W.T. ROGERS COMPANY
1. See Schedule II
NEWELL HOLDINGS FRANCE S.A.S.
* Royal Bank of Canada Line of Credit 17,146,014 17,146,014
NEWELL INDUSTRIES CANADA, INC.
* Royal Bank of Canada Line of Credit 7,241,000 7,241,000
NEWELL INVESTMENTS INC.
* Barclays Bank Line of Credit 9,387,139 9,387,139
* Banca Nazionale del Lavoro Line of Credit 10,094,963 10,094,963
<PAGE> 76
* Banca Nazionale del Lavoro Line of Credit 4,164,983 4,164,983
BEROL S.A. DE C.V. (MEXICO)
* Bank of America Line of Credit (MXP)135,000,000 0
Banamex Line of Credit 50,000,000 (MXP)13,000,000
</TABLE>
<PAGE> 77
SCHEDULE II
LIST OF CERTAIN LIENS
<TABLE>
Balance
Outstanding
Lender or Trustee Type of Arrangement Property Covered 6/30/95
----------------- ------------------- ---------------- -----------
STUART HALL COMPANY, INC.
<S> <C>
The CIT Group Various Promissory Notes Equipment $ 3,986,673
Total $8,790,744
W.T. ROGERS COMPANY
IDS Financial IDS $1,298,650 10.625% Real Property 1,079,793
Corp. Due May 1, 1999
</TABLE>
<PAGE> 78 SCHEDULE III
SUBSIDIARIES
<TABLE>
Jurisdiction of Percent
Name of Subsidiary Organization Owned Ownership
<S> <S> <C> <S> <C>
Ashland Products, Inc. Delaware 100 Newell Co.
Anchor Hocking Corporation Delaware 100 Newell Operating Company
Anchor Hocking Consumer Delaware 100 Anchor Hocking Corporation
Glass Company
Counselor Borg Scale Company Delaware 100 Anchor Hocking Corporation
Berol Corporation Delaware 100 Newell Co.
Eberhard Faber, Inc. Delaware 100 Faber-Castell Corporation
Berol Blue Ribbon Corp. Kentucky 100 Berol Corporation
Eberhard Faber, Inc. New Jersey 100 Faber-Castell Corporation
Berol Trademarks, Inc. Delaware 100 Berol Corporation
DeComex USA Delaware 100 Intercraft Company
Faber-Castell Canada Ltd. Ontario, Canada 100 Faber-Castell Corporation
Empire Leasing Company Delaware 76 Berol Corporation
25 Berol Canada
Faber-Castell Corporation New Jersey 100 Newell Co.
Goody Products, Inc. Delaware 100 Newell Co.
Kirsch, Inc. Delaware 100 Newell Co.
Intercraft Company Delaware 100 Newell Co.
Lee-Rowan Company Missouri 100 Newell Co.
Newell Australia Pty, Ltd. Australia 100 Newell Investments Inc.
Newell Finance Company Delaware 100 Newell Operating Company
Newell Holdings Spain, Inc. Delaware 100 Newell Investments Inc.
Newell Holdings France France 1 Newell Operating Company
S.A.S. 99 Newell Investments Inc.
Newell Holdings U.K. Limited U.K. 100 Newell Investments Inc.
NSM Industries, Inc. New Jersey 100 Faber-Castell Corporation
Newell Iberica S.A. Spain 100 Newell S.A.
Newell Industries Canada, Ontario, Canada 100 Newell Operating Company
Inc.
Newell International Jamaica 100 Newell Co.
Corporation Limited
<PAGE> 79
Jurisdiction of Percent
Name of Subsidiary Organization Owned Ownership
Newell Investment Co. Ontario, Canada 100 Newell Co.
Limited
Newell Investments Inc. Delaware 100 Newell Operating Company
Newell Limited U.K. 100 Newell Holdings U.K. Limited
Newell Operating Company Delaware 77.5 Newell Co.
22.5 Anchor Hocking Corporation
Newell Puerto Rico, Ltd. Delaware 100 Anchor Hocking Corporation
Newell S.A. France 99 Newell Holdings France S.A.S.
1 Nominees, as required by
statute
Newell S.p.A. Italy 100 Newell S.A.
Newell Window Furnishings, Delaware 100 Newell Operating Company
Inc.
N.V. Newell Benelux S.A. Belgium 99 Newell S.A.
1 Nominees, as required by
statute
Plastics, Inc. Delaware 100 Anchor Hocking Corporation
Pen and Pencil, Inc. Illinois 100 Newell Co.
Sterling Plastics Co. New York 100 Sanford Corporation
Philips Industries, Inc. New York 100 Newell Co.
Stuart Hall Company, Inc. Missouri 100 Newell Co.
Rolodex de Puerto Rico 100 Sterling Plastics Co.
Sanford Investment Company Delaware 21.29 Berol Corporation
35.37 Faber-Castell Corporation
43.34 Pen and Pencil, Inc.
Sanford L.P. Illinois 1.62 Newell Operating Company
(limited part.) 98.38 Sanford Investment Company
Berol S.A. Colombia 43.41 Berol Pen
S. America 14.00 Ember Investment
16.91 Furth
13.00 Loral
12.88 Terbal
Berol SA de CV Mexico 81.35 Berol
18.48 Newell Co.
.17 General Public
Decorel SA de CV Mexico 100 Intercraft Company
Berol Limited U.K. 100 Berol
<PAGE> 80
Jurisdiction of Percent
Name of Subsidiary Organization Owned Ownership
Newell Consumer Products Germany 100 Newell Investments Inc.
GmBh
Sani Kirsch, Inc. & Co. K.G. Germany 100 Newell Consumer Products GmBh
Newell Holdings SA Spain 99 Newell Holdings Spain, Inc.
1 Newell Investments Inc.
Home Fittings Espana, SA Spain 99 Newell Holdings Spain SA
1 Newell Holdings Spain, Inc.
Commercial Decorating SA Italy 100 Home Fittings Espana SA
Home Fittings de Portugal Portugal 100 Home Fittings Espana SA
Decoracao Limitaoa
Hofesa France SA France 99.9 Home Fittings Espana SA
Hofesa UK PLC U.K. 100 Home Fittings Espana SA
Sani Sweden AB Sweden 100 Newell Investments Inc.
AB Sani-Maskiner Sweden 100 Sani Sweden AB
Sani Kirsch Sweden Sweden 100 Sani Sweden AB
Newell de Mexico SA de CV Mexico 99.99 Newell Investments Inc.
Eberhard Faber-Sanford Delaware 100 Newell Investments Inc.
Company (Venezuela)
Newell Ireland Ireland 100 Newell Industries Canada
<PAGE> 81
EXHIBIT A-1
[FORM OF OPINION OF SPECIAL COUNSEL TO NEWELL]
[______________], 1997
Each of the Banks party
to the Amended and Restated
Credit Agreement referred to
below and The Chase Manhattan
Bank, as Administrative Agent
Ladies and Gentlemen:
We have acted as special counsel to Newell Co., a
corporation organized under the laws of Delaware (the "COMPANY"),
in connection with the Amended and Restated Credit Agreement
dated as of June 12, 1995, amended and restated as of August 5,
1997 (the "AMENDED AND RESTATED CREDIT AGREEMENT") among the
Company, the Banks party thereto and The Chase Manhattan Bank, in
its capacity as agent for said Banks. All capitalized terms used
but not defined herein have the respective meanings given to such
terms in the Amended and Restated Credit Agreement.
In rendering the opinions expressed below, we have
examined:
(a) the Amended and Restated Credit Agreement;
(b) the Notes (if any) of the Company (collectively
with the documents referred to in the foregoing
lettered clause, the "CREDIT DOCUMENTS"); and
(c) such corporate records of the Company and such
other documents as we have deemed necessary as a
basis for the opinions expressed below.
In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as
originals and the conformity with authentic original documents of
all documents submitted to us as copies. With respect to matters
of fact, we have relied upon statements of governmental officials
and upon representations made in or pursuant to the Credit
Documents and certificates of appropriate representatives of the
Company.
<PAGE> 82
In rendering the opinions expressed below, we have
assumed, with respect to all of the documents referred to in this
opinion letter, that (except, to the extent set forth in the
opinions expressed below, as to the Company):
(i) such documents have been duly authorized by, have
been duly executed and delivered by, and
constitute legal, valid, binding and enforceable
obligations of, all of the parties to such
documents;
(ii) all signatories to such documents have been duly
authorized; and
(iii) all of the parties to such documents are duly
organized and validly existing and have the power
and authority (corporate or other) to execute,
deliver and perform such documents.
Based upon and subject to the foregoing and subject
also to the comments and qualifications set forth below, and
having considered such questions of law as we have deemed
necessary as a basis for the opinions expressed below, we are of
the opinion that:
1. The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of
Delaware.
2. The Company has all requisite corporate power to
execute and deliver, and to perform its obligations under,
each Credit Document to which it is a party. The Company
has all requisite corporate power to borrow under the
Amended and Restated Credit Agreement.
3. The execution, delivery and performance by the
Company of each Credit Document and the borrowings by and
guarantee of the Company, have been duly authorized by all
necessary corporate action on the part of the Company.
4. Each Credit Document has been duly executed and
delivered by the Company.
5. While the matter is not free from doubt, under
Illinois conflict of laws principles, the stated choice of
New York law in the Notes and in Section 12.09(a) of the
Amended and Restated Credit Agreement should be given effect
by the courts of the State of Illinois. However, if the
Credit Documents were governed by and construed in
accordance with the law of the State of Illinois, each
Credit Document (assuming, in the case of the Notes,
<PAGE> 83
execution and delivery thereof for value) would constitute
the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its
terms, except in each case as such enforceability may be
limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws
relating to the enforcement of creditors' rights generally
or by general principles of equity (whether considered in a
suit at law or in equity and including, without limitation,
(i) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (ii)
concepts of materiality, reasonableness, good faith and fair
dealing), or (b) in the case of Section 11.02 of the Amended
and Restated Credit Agreement, restrictions imposed by law
or public policy limiting a person's right to waive the
benefits of certain legal rights.
6. No authorization, approval or consent of, and no
filing or registration with, any governmental or regulatory
authority or agency of the United States of America or the
State of Illinois is required on the part of the Company for
the execution, delivery or performance by the Company of the
Credit Documents or for any borrowings by, or guarantee of,
the Company.
7. The execution, delivery and performance by the
Company of its obligations under each Credit Document and
the borrowing by, and guarantee of, the Company do not
(a) violate any provision of the charter or by-laws of the
Company, (b) violate any applicable law, rule or regulation,
(c) violate any order, writ, injunction or decree of any
court or governmental authority or agency or any arbitral
award applicable to the Company of which we have knowledge
or (d) result in a breach of, constitute a default under,
require any consent under, or result in the acceleration or
required prepayment of any indebtedness pursuant to the
terms of, any "Material Contract" (as defined below), or
result in the creation or imposition of any Lien upon any
Property of the Company pursuant to the terms of any
Material Contract. For purposes hereof, the term "Material
Contract" means each agreement or instrument filed as an
exhibit to, or incorporated by reference in, the most recent
Annual Report to the Securities and Exchange Commission
("SEC") on Form 10-K of the Company or any report filed by
the Company since the date of such Annual Report with the
SEC under Section 13 of the Securities Exchange Act of 1934,
as amended.
The foregoing opinions are subject to the following
additional comments and qualifications:
<PAGE> 84
A. The enforceability of the second sentence of
Section 12.03 of the Amended and Restated Credit Agreement
may be limited by laws limiting the enforceability of
provisions exculpating or exempting a party, or requiring
indemnification of a party for, liability for its own action
or inaction, to the extent the action or inaction involves
gross negligence, recklessness, willful misconduct or
unlawful conduct.
B. The enforceability of provisions in the Credit
Documents to the effect that terms may not be waived or
modified except in writing may be limited under certain
circumstances.
C. We express no opinion as to (i) the effect of the
laws of any jurisdiction in which any Bank is located (other
than Illinois) that limit the interest, fees or other
charges such Bank may impose, (ii) the third sentence of
Section 4.05(b) of the Amended and Restated Credit Agreement
(iii) Section 12.11 of the Amended and Restated Credit
Agreement, and (iv) the second sentence of Section 12.09(a)
of the Amended and Restated Credit Agreement, insofar as
such sentence relates to the subject matter jurisdiction of
the United States District Court for the Southern District
of New York to adjudicate any controversy related to the
Credit Documents, and the third and fifth sentences of
Section 12.09(a) of the Amended and Restated Credit
Agreement.
D. As used herein, the phrase "of which we have
knowledge" means the actual knowledge of the undersigned
attorney, and the other attorneys of this firm with direct
involvement with the Credit Documents, as to matters such
attorneys have provided substantive legal advice.
E. For purposes of our opinion in the first sentence
of paragraph 5 above, we have also assumed that giving
effect to each such stated choice of New York law does not
violate any public policy of the State of Illinois and that
there is a reasonable basis for the parties' choice of New
York law.
F. We point out with reference to obligations stated
to be payable in an Alternative Currency that (a) a New York
statute provides that a judgment rendered by a court of the
State of New York in respect of an obligation denominated in
a currency other than Dollars would be rendered in such
other currency and would be converted into Dollars at the
rate of exchange prevailing on the date of entry of the
judgment and (b) a judgment rendered by a Federal court
sitting in the State of New York in respect of an obligation
<PAGE> 85
denominated in a currency other than Dollars may be
expressed in Dollars, but we express no opinion as to the
rate of exchange such Federal court would apply.
The foregoing opinions are limited to matters involving
the Federal laws of the United States of America, the Delaware
General Corporation Law and the law of the State of Illinois, and
we do not express any opinion as to the laws of any other
jurisdiction. This opinion is limited in all respects to the
facts and law existing on the date of this opinion letter and, by
rendering our opinion, we do not undertake to advise you of any
changes in such facts or law which may occur after the date of
this opinion letter.
At the request of our client, this opinion letter is,
pursuant to Section 6.01(c) of the Amended and Restated Credit
Agreement, provided to you by us in our capacity as counsel to
the Company and may not be relied upon by any Person for any
purpose other than in connection with the transactions
contemplated by the Amended and Restated Credit Agreement
without, in each instance, our prior written consent.
Very truly yours,
SCHIFF HARDIN & WAITE
By: _____________________
<PAGE> 86 EXHIBIT A-2
[FORM OF OPINION OF GENERAL COUNSEL TO THE COMPANY]
[___________], 1997
To the Banks Party to the Amended
and Restated Credit Agreement
referred to Below and The Chase
Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
I am the Vice President and General Counsel of Newell
Co. (the "COMPANY") and am rendering the opinion contained herein
in connection with the Amended and Restated Credit Agreement (the
"AMENDED AND RESTATED CREDIT AGREEMENT"), dated as of June 12,
1995, amended and restated as of August 5, 1997 among the
Company, the Banks party thereto and The Chase Manhattan Bank, as
Administrative Agent. Terms defined in the Amended and Restated
Credit Agreement are used herein as defined therein.
In rendering the opinion expressed below, I have
examined the originals or copies of such corporate and
stockholder records, agreements and instruments of the Company,
certificates of public officials and of officers of the Company
and such other documents and papers as I have deemed necessary as
a basis for the opinion hereinafter expressed. In such
examination, I have assumed the genuineness of all signatures,
the authenticity of documents submitted to me as originals and
the conformity to the original documents of all documents
submitted to me as copies. With respect to matters of fact, I
have relied upon representations and certificates of public
officials and of officers of the Company, including the
representations made by the Company in the Amended and Restated
Credit Agreement.
Based upon the foregoing and subject to the
qualifications set forth below, and having due regard for such
legal considerations as I have deemed relevant, I am of the
opinion that, to my knowledge, there are no legal or arbitral
proceedings, and no proceedings by or before any governmental or
regulatory authority or agency, pending or threatened against the
Company or any of its Subsidiaries which could be reasonably
expected to have a Material Adverse Effect.
<PAGE> 87
This opinion has been rendered solely to you for your
use in connection with the Amended and Restated Credit Agreement.
No other person or entity shall be entitled to rely hereon
without my prior written consent.
Very truly yours,
<PAGE> 88
EXHIBIT B
[FORM OF OPINION OF SPECIAL NEW YORK
COUNSEL TO THE BANKS AND THE ADMINISTRATIVE AGENT]
[____________], 1997
Each of the Banks party to the
Amended and Restated Credit
Agreement referred to below
and The Chase Manhattan Bank,
as Administrative Agent
Ladies and Gentlemen:
We have acted as your special New York counsel in
connection with the Amended and Restated Credit Agreement dated
as of June 12, 1995, amended and restated as of August 5, 1997
(the "AMENDED AND RESTATED CREDIT AGREEMENT") among Newell Co., a
corporation organized under the laws of Delaware (the "COMPANY"),
the Banks party thereto and The Chase Manhattan Bank, in its
capacity as agent for said Banks (the "ADMINISTRATIVE AGENT"),
providing for, among other things, the making of loans by the
Banks in an aggregate principal amount not to exceed
$1,300,000,000. All capitalized terms used but not defined
herein have the respective meanings given to such terms in the
Amended and Restated Credit Agreement.
In rendering the opinions expressed below, we have
examined:
(a) the Amended and Restated Credit Agreement; and
(b) the Notes (if any) being executed and delivered to the
Banks on the Amendment Effective Date (herein, the
"NOTES")
The Amended and Restated Credit Agreement and the Notes are
collectively referred to as the "CREDIT DOCUMENTS".
In our examination, we have assumed the authenticity of
all documents submitted to us as originals and the conformity
with authentic original documents of all documents submitted to
us as copies. When relevant facts were not independently
established, we have relied upon representations made in the
Credit Documents.
<PAGE> 89
In rendering the opinions expressed below, we have
assumed, with respect to the Credit Documents, that:
(i) the Credit Documents have been duly authorized by,
have been duly executed and delivered by, and
(except to the extent set forth below, as to the
Company) constitute legal, valid, binding and
enforceable obligations of, all of the parties to
such documents;
(ii) all signatories to the Credit Documents have been
duly authorized; and
(iii) all of the parties to the Credit Documents are
duly organized and validly existing and have the
power and authority (corporate or other) to
execute, deliver and perform the Credit Documents.
In addition, we have assumed that:
(i) all Banks party to the Existing Credit Agreement
on the Amendment Effective Date are party to the
Amended and Restated Credit Agreement; and
(ii) upon delivery of this legal opinion, all of the
conditions precedent set forth in Section 6.01 of
the Amended and Restated Credit Agreement to the
effectiveness of the Amended and Restated Credit
Agreement shall have been satisfied.
Based upon and subject to the foregoing and subject
also to the comments and qualifications set forth below, and
having considered such questions of law as we have deemed
necessary as a basis for the opinions expressed below, we are of
the opinion that each Credit Document (assuming, in the case of
the Notes of the Company, execution and delivery thereof for
value) constitutes the legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its
terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights of creditors generally and except as the
enforceability of the Credit Documents is subject to the
application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law),
including, without limitation, (a) the possible unavailability of
specific performance, injunctive relief or any other equitable
remedy and (b) concepts of materiality, reasonableness, good
faith and fair dealing.
The foregoing opinions are subject to the following
comments and qualifications:
<PAGE> 90
A. The enforceability of Section 12.03 of the Amended
and Restated Credit Agreement may be limited by laws
limiting the enforceability of provisions exculpating or
exempting a party, or requiring indemnification of a party
for, liability for its own action or inaction, to the extent
the action or inaction involves gross negligence,
recklessness, willful misconduct or unlawful conduct.
B. The enforceability of provisions in the Amended and
Restated Credit Documents to the effect that terms may not
be waived or modified except in writing may be limited under
certain circumstances.
C. We express no opinion as to (i) the effect of the
laws of any jurisdiction in which any Bank is located (other
than the State of New York) that limit the interest, fees or
other charges such Bank may impose, (ii) the third sentence
of Section 4.05(b) of the Amended and Restated Credit
Agreement (iii) Section 12.11 of the Amended and Restated
Credit Agreement, (iv) the second sentence of
Section 12.09(a) of the Amended and Restated Credit
Agreement, insofar as such sentence relates to the subject
matter jurisdiction of the United States District Court for
the Southern District of New York to adjudicate any
controversy related to the Credit Documents and (v) the
waiver of inconvenient forum set forth in Section 12.09(a)
of the Amended and Restated Credit Agreement with respect to
proceedings in the United States District Court for the
Southern District of New York.
D. We point out with reference to obligations stated
to be payable in an Alternative Currency that (a) a New York
statute provides that a judgment rendered by a court of the
State of New York in respect of an obligation denominated in
a currency other than Dollars would be rendered in such
other currency and would be converted into Dollars at the
rate of exchange prevailing on the date of entry of the
judgment and (b) a judgment rendered by a Federal court
sitting in the State of New York in respect of an obligation
denominated in a currency other than Dollars may be
expressed in Dollars, but we express no opinion as to the
rate of exchange such Federal court would apply.
The foregoing opinions are limited to matters involving
the Federal laws of the United States of America and the law of
the State of New York, and we do not express any opinion as to
the laws of any other jurisdiction.
This opinion letter is, pursuant to Section 6.01(d) of
the Amended and Restated Credit Agreement, provided to you by us
in our capacity as your special New York counsel and may not be
<PAGE> 91
relied upon by any Person for any purpose other than in
connection with the transactions contemplated by the Amended and
Restated Credit Agreement without, in each instance, our prior
written consent.
Very truly yours,
CDP/RJW
<PAGE> 92
EXHIBIT C
[THIS PAGE INTENTIONALLY LEFT BLANK]
Guarantee Agreement
<PAGE> 93
EXHIBIT D
[FORM OF COMPETITIVE BID REQUEST]
COMPETITIVE BID REQUEST
[______________, 19__]
The Chase Manhattan Bank,
as Administrative Agent
Agent Bank Services
New York, New York 10081
Attention:
Ladies and Gentlemen:
Reference is made to the Amended and Restated Credit
Agreement dated as of June 12, 1995, amended and restated as of
August 5, 1997 (as amended, supplemented and otherwise modified
and in effect from time to time, the "AMENDED AND RESTATED CREDIT
AGREEMENT") among Newell Co., a Delaware corporation, the Banks
party thereto and The Chase Manhattan Bank, as Administrative
Agent. Terms used but not defined herein have the respective
meanings given to such terms under the Amended and Restated
Credit Agreement. This Competitive Bid Request is being
delivered to the Administrative Agent pursuant to Section 2.03(b)
of the Amended and Restated Credit Agreement.
The undersigned hereby requests that the Banks submit,
as provided in Section 2.03(c) of the Amended and Restated Credit
Agreement, Competitive Bids for the proposed Competitive
Borrowing(s) described below:
Competitive Bid Request
<PAGE> 94
Borrowing Interest
Borrower Date Currency Amount * Type ** Period ***
-------- ---- -------- ------ ---- ------
Please notify, as provided in Section 2.03(b) of the
Amended and Restated Credit Agreement, the Banks of this
Competitive Bid Request.
Very truly yours,
NEWELL CO.
By____________________________
Name:
Title:
*Each amount must be $5,000,000 or an integral multiple of $1,000,000
in excess thereof or the Dollar Equivalent thereof.
**Insert either "Margin" (in the case of Competitive LIBOR Loans) or
"Rate" (in the case of Set Rate Loans).
***1, 2, 3 or 6 months (in the case of a Competitive LIBOR Loan) or a
period of up to 180 days after the making of the Loan the last day of
which is a Business Day (in the case of a Set Rate Loan).
Competitive Bid Request
<PAGE> 95
EXHIBIT E
[FORM OF COMPETITIVE BID]
Competitive Bid
[______________, 19__]
The Chase Manhattan Bank,
as Administrative Agent
Agent Bank Services
New York, New York 10081
Attention:
Ladies and Gentlemen:
Reference is made to the Amended and Restated Credit
Agreement dated as of June 12, 1995, amended and restated as of
August 5, 1997 (as amended, supplemented and otherwise modified
and in effect from time to time, the "AMENDED AND RESTATED CREDIT
AGREEMENT") among Newell Co., a Delaware corporation, the Banks
party thereto and The Chase Manhattan Bank, as Administrative
Agent. Terms used but not defined herein have the respective
meanings given to such terms under the Amended and Restated
Credit Agreement. This Competitive Bid is being delivered to the
Administrative Agent pursuant to Section 2.03(c) of the Amended
and Restated Credit Agreement.
In response to the Competitive Bid Request of the
Company dated [_______, 19__], the undersigned hereby submits, as
provided in Section 2.03(c) of the Amended and Restated Credit
Agreement, Competitive Bid(s) for the proposed Competitive
Borrowing(s) described below:
Competitive Bid
<PAGE> 96
Borrowing Interest
Borrower Date Currency Amount * Type ** Period *** Rate ****
-------- ---- -------- ------ ---- ------ ----
PROVIDED that the Company may not accept offers that would result
in the undersigned making Competitive Loans pursuant hereto in
excess of $[____________] in the aggregate (the "COMPETITIVE LOAN
LIMIT").
Please notify, as provided in Section 2.03(d) of the
Amended and Restated Credit Agreement, the Company of this
Competitive Bid.
We understand and agree that the offer(s) set forth
above, subject to the satisfaction of the applicable conditions
set forth in the Amended and Restated Credit Agreement,
irrevocably obligate(s) us to make the Competitive Loan(s) for
which any offer(s) [IS] [ARE] accepted, in whole or in part
(subject to the third sentence of Section 2.03(e) of the Amended
and Restated Credit Agreement and any Competitive Loan Limit
specified above).
Very truly yours,
[NAME OF BANK]
By____________________________
Name:
Title:
*Each amount must be per Section 2.03(c)(ii) or an integral multiple of
$1,000,000 or the Foreign Currency Equivalent thereof.
**Insert either "Margin" (in the case of Competitive LIBOR Loans) or
"Rate" (in the case of Set Rate Loans).
***1, 2, 3 or 6 months (in the case of a Competitive LIBOR Loan) or a
period of up to 180 days after the making of the Loan the last day of
which is a Business Day (in the case of a Set Rate Loan).
****For a Competitive LIBOR Loan, specify margin over or under the LIBO
Rate determined for the applicable Interest Period as a percentage
(rounded to the nearest 1/10,000th of 1%) and whether "PLUS" or
"MINUS". For a Set Rate Loan, specify rate of interest per annum
(rounded to the nearest 1/10,000th of 1%).
Competitive Bid
<PAGE> 97
EXHIBIT F-1
[FORM OF DESIGNATION LETTER]
[DATE]
To The Chase Manhattan Bank,
as Administrative Agent
Agent Bank Services
New York, New York 10081
Attention:
Ladies and Gentlemen:
We make reference to the Amended and Restated Credit
Agreement (as amended, supplemented and otherwise modified and in
effect from time to time, the "AMENDED AND RESTATED CREDIT
AGREEMENT") dated as of June 12, 1995, amended and restated as of
August 5, 1997 among Newell Co. (the "COMPANY"), the banks party
thereto (the "BANKS") and The Chase Manhattan Bank, as
Administrative Agent (in such capacity, the "ADMINISTRATIVE
AGENT"). Terms defined in the Amended and Restated Credit
Agreement are used herein as defined therein.
The Company hereby designates [_____________] (the
"DESIGNATED BORROWER"), a Wholly-Owned Subsidiary of the Company
and a corporation duly incorporated under the laws of
[STATE/COUNTRY], as a Borrower in accordance with Section 2.04 of
the Amended and Restated Credit Agreement until such designation
is terminated in accordance with said Section 2.04, entitled to
borrower Competitive Loans.
The Designated Borrower hereby accepts the above
designation and hereby expressly and unconditionally accepts the
obligations of a Borrower under the Amended and Restated Credit
Agreement, adheres to the Amended and Restated Credit Agreement
and agrees and confirms that, upon your execution and return to
the Company of the enclosed copy of this letter, it shall be a
Borrower for purposes of the Amended and Restated Credit
Agreement and agrees to be bound by and to perform and comply
with the terms and provisions of the Amended and Restated Credit
Agreement applicable to it as if it had originally executed the
Amended and Restated Credit Agreement. The Designated Borrower
hereby authorizes and empowers the Company to act as its
representative and attorney-in-fact for the purposes of signing
documents and giving and receiving notices (including notices of
borrowing under Section 2 of the Amended and Restated Credit
Agreement) and other communications in connection with the
Amended and Restated Credit Agreement and the transactions
contemplated thereby and for the purposes of modifying or
Designation Letter
<PAGE> 98
amending any provision of the Amended and Restated Credit
Agreement and further agrees that the Administrative Agent and
each Bank may conclusively rely on the foregoing authorization.
The Company hereby represents and warrants to the
Administrative Agent and each Bank that, before and after giving
effect to this Designation Letter, (i) the representations and
warranties set forth in Section 7 of the Amended and Restated
Credit Agreement are true and correct on the Restatement Date as
if made on and as of the date hereof and (ii) no Default has
occurred and is continuing.
The Designated Borrower hereby agrees that this
Designation Letter, the Amended and Restated Credit Agreement and
the Notes shall be governed by, and construed in accordance with,
the law of the State of New York. The Designated Borrower hereby
submits to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York and of any
New York state court sitting in New York City for the purposes of
all legal proceedings arising out of or relating to this
Designation Letter, the Amended and Restated Credit Agreement or
the transactions contemplated thereby. The Designated Borrower
irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the
venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been
brought in an inconvenient forum. The Designated Borrower
further agrees that service of process in any such action or
proceeding brought in New York may be made upon it by service
upon the Company at the "Address for Notices" specified below its
name on the signature pages to the Amended and Restated Credit
Agreement and the Approved Borrower hereby irrevocably appoints
the Company as its authorized agent ("PROCESS AGENT") to accept,
on behalf of it and its property such service of process in New
York.
THE DESIGNATED BORROWER IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
DESIGNATION LETTER, THE AMENDED AND RESTATED CREDIT AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED THEREBY.
Anything herein to the contrary notwithstanding, the
Company and the Designated Borrower hereby agree that unless and
until the Designated Borrower becomes an Approved Designated
Borrower as aforesaid, Committed Loans are not available to the
Designation Letter
<PAGE> 99
Designated Borrower under the Amended and Restated Credit
Agreement; and the Administrative Agent hereby agrees on behalf
of the Banks that the provisions of Section 5.06(a) of the
Amended and Restated Credit Agreement are not applicable to the
Designated Borrower, unless and until the Designated Borrower
becomes an Approved Designated Borrower.
[The Company hereby requests that the Designated Borrower be
approved as an Approved Designated Borrower. Subject to the
approval of all of the Banks (to be evidenced by your signing at
the place below indicated and returning to the Company the
enclosed copy of this letter) such Designated Borrower will
become an Approved Designated Borrower entitled to borrow both
Committed Loans and Competitive Loans.]
NEWELL CO.
By__________________________
Name:
Title:
[DESIGNATED BORROWER]
By___________________________
Name:
Title:
[INSERT ADDRESS]
[Consent and Agree to the
aforesaid Designated Borrower
being an Approved Designated
Borrower:
THE CHASE MANHATTAN BANK
As Administrative Agent for and on behalf
of the Banks
By________________________
Name:
Title:
Date:_____________________]
Designation Letter
<PAGE> 100
EXHIBIT F-2
[FORM OF TERMINATION LETTER]
[DATE]
To The Chase Manhattan Bank,
as Administrative Agent
Agent Bank Services
New York, New York 10081
Attention:
Ladies and Gentlemen:
We make reference to the Amended and Restated Credit
Agreement (as amended, supplemented and otherwise modified and in
effect from time to time, the "AMENDED AND RESTATED CREDIT
AGREEMENT") dated as of June 12, 1995, amended and restated as of
August 5, 1997 among Newell Co. (the "COMPANY"), the banks party
thereto (the "BANKS") and The Chase Manhattan Bank as
Administrative Agent (in such capacity, the "ADMINISTRATIVE
AGENT"). Terms defined in the Amended and Restated Credit
Agreement are used herein as defined therein.
The Company hereby terminates the status as a
Designated Borrower of [______________], a corporation
incorporated under the laws of [STATE/COUNTY], in accordance with
Section 2.04 of the Amended and Restated Credit Agreement,
effective as of the date of receipt of this notice by the
Administrative Agent. The undersigned hereby represent and
warrant that all principal and interest on any Loan of the above-
referenced Designated Borrower and all other amounts payable by
such Designated Borrower pursuant to the Amended and Restated
Credit Agreement have been paid in full on or prior to the date
hereof. Notwithstanding the foregoing, this Termination Letter
shall not affect any obligation which by the terms of the Amended
and Restated Credit Agreement survives termination thereof.
NEWELL CO.
By
----------------------------
Name:
Title:
[INSERT NAME OF DESIGNATED
BORROWER]
By
-----------------------------
Name:
Title:
Termination Letter
</TABLE>
