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CREDIT AGREEMENT
among
QUANTUM CORPORATION
and
THE BANKS NAMED HEREIN
and
ABN AMRO BANK N.V., San Francisco International Branch
and
CIBC INC.,
as Co-Arrangers for the Banks
and
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent for the Banks
and
ABN AMRO BANK N.V., San Francisco International Branch,
as Syndication Agent for the Banks
and
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
as Documentation Agent for the Banks
June 6, 1997
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CREDIT AGREEMENT
Table of Contents
Page
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SECTION I. INTERPRETATION.................................... 1
1.01. Definitions....................................... 1
1.02. GAAP.............................................. 22
1.03. Headings.......................................... 23
1.04. Plural Terms...................................... 23
1.05. Time.............................................. 23
1.06. Governing Law..................................... 23
1.07. Construction...................................... 23
1.08. Entire Agreement.................................. 23
1.09. Calculation of Interest and Fees.................. 23
1.10. Other Interpretive Provisions..................... 23
SECTION II. CREDIT FACILITIES................................. 24
2.01. Revolving Loan Facility........................... 24
2.02. Letter of Credit Facility......................... 28
2.03. Amount Limitations, Commitment Reductions, Etc. .. 33
2.04. Fees.............................................. 34
2.05. Prepayments....................................... 36
2.06. Other Payment Terms............................... 37
2.07. Notes and Interest Account........................ 38
2.08. Revolving Loan Funding, Etc....................... 38
2.09. Pro Rata Treatment................................ 39
2.10. Change of Circumstances........................... 41
2.11. Taxes on Payments................................. 44
2.12. Funding Loss Indemnification...................... 46
2.13. Replacement of Banks.............................. 47
SECTION III. CONDITIONS PRECEDENT.............................. 47
3.01. Initial Conditions Precedent...................... 47
3.02. Conditions Precedent to Each Credit Event......... 48
3.03. Conditions Precedent to Each Conversion or
Each Selection of Interest Period................. 48
SECTION IV. REPRESENTATIONS AND WARRANTIES.................... 49
4.01. Borrower's Representations and Warranties......... 49
4.02. Reaffirmation..................................... 54
SECTION V. COVENANTS......................................... 55
5.01. Affirmative Covenants............................. 55
5.02. Negative Covenants................................ 59
SECTION VI. DEFAULT........................................... 73
6.01. Events of Default................................. 73
6.02. Remedies.......................................... 75
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Page
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SECTION VII. AGENTS AND RELATIONS AMONG BANKS.................. 76
7.01. Appointment, Powers and Immunities................ 76
7.02. Reliance by Agents................................ 76
7.03. Defaults.......................................... 77
7.04. Indemnification................................... 77
7.05. Non-Reliance...................................... 78
7.06. Resignation or Removal of Administrative
Agent............................................. 78
7.07. Removal of Co-Arrangers........................... 79
7.08. Authorization..................................... 79
7.09. Agents in Their Individual Capacities............. 80
7.10. Agents' Communications Binding Upon Banks......... 80
7.11. No Obligations of Borrower........................ 80
7.12. Co-Agents......................................... 80
SECTION VIII. MISCELLANEOUS................................................. 81
8.01. Notices........................................... 81
8.02. Expenses.......................................... 82
8.03. Indemnification................................... 82
8.04. Waivers; Amendments............................... 83
8.05. Successors and Assigns............................ 84
8.06. Setoff; Security Interest......................... 88
8.07. No Third Party Rights............................. 89
8.08. Partial Invalidity................................ 89
8.09. Jury Trial........................................ 89
8.10. Counterparts...................................... 89
8.11. Confidentiality................................... 89
ii
SCHEDULES
I Banks
II Pricing Grid
3.01 Initial Conditions Precedent
4.01(p) Borrower's Subsidiaries
5.02(a) Permitted Financial Covenants
EXHIBITS
A Notice of Borrowing (2.01(b))
B Notice of Conversion (2.01(d))
C Notice of Interest Period Selection (2.01(e))
D Note (2.07(a))
E Compliance Certificate (5.01(a))
F Subordinated Debt Terms (5.02(a))
G Assignment Agreement (8.05(c))
iii
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of June 6, 1997, is entered into by and
among:
(1) QUANTUM CORPORATION, a Delaware corporation ("Borrower");
(2) Each of the financial institutions from time to time
listed in Schedule I hereto, as amended from time to time (such
financial institutions to be referred to herein collectively as the
"Banks");
(3) ABN AMRO BANK N.V., San Francisco International Branch
("ABN") and CIBC INC. ("CIBC"), as co-arrangers for the Banks
(collectively in such capacity, the "Co- Arrangers");
(4) CANADIAN IMPERIAL BANK OF COMMERCE, as administrative
agent for the Banks (in such capacity, the "Administrative Agent");
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as
documentation agent for the Banks; and ABN, as syndication agent for
the Banks; and
(5) BANKBOSTON, N.A., THE BANK OF NOVA SCOTIA, FLEET NATIONAL
BANK, and THE INDUSTRIAL BANK OF JAPAN, LIMITED, as co-agents for the
Banks.
RECITALS
A. Borrower has requested that the Banks provide certain credit
facilities to Borrower on an unsecured basis.
B. The Banks are willing to provide such credit facilities upon the
terms and subject to the conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the above Recitals and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION I. INTERPRETATION.
1.01. Definitions. Unless otherwise indicated in this Agreement or any
other Credit Document, each term set forth below, when used in this Agreement or
any other Credit Document, shall have the respective meaning given to that term
below or in
the provision of this Agreement or other Credit Document referenced below:
"ABN" shall have the meaning given to that term in clause (3)
of the introductory paragraph hereof.
"Administrative Agent" shall have the meaning given to that
term in clause (4) of the introductory paragraph hereof.
"Administrative Agent's Fee Letter" shall mean the letter
agreement dated the date of this Agreement between Borrower and
Administrative Agent.
"Affiliate" shall mean, with respect to any Person, (a) each
Person that, directly or indirectly, owns or controls, whether
beneficially or as a trustee, guardian or other fiduciary, ten percent
(10%) or more of the Equity Securities of such Person having voting
power, (b) each Person that controls, is controlled by or is under
common control with such Person or any Affiliate of such Person or (c)
each of such Person's officers and directors; provided, however, that
in no case shall any Agent or any Bank Party be deemed to be an
Affiliate of Borrower, any of Borrower's Subsidiaries or MKE-Quantum
for purposes of this Agreement. For the purpose of this definition,
"control" of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of its
management or policies, whether through the ownership of voting
securities, by contract or otherwise.
"Agents" shall mean Administrative Agent and the Co-
Arrangers.
"Agents' Fee Letters" shall mean the Administrative Agent's
Fee Letter and the Co-Arrangers' Fee Letter.
"Agreement" shall mean this Credit Agreement.
"Applicable Lending Office" shall mean, with respect to any
Bank, (a) initially, its office designated as such in Schedule I (or,
in the case of any Bank which becomes a Bank by an assignment pursuant
to Subparagraph 8.05(c), its office designated as such in the
applicable Assignment Agreement) and (b) subsequently, such other
office or offices as such Bank may designate to Administrative Agent as
the office at which such Bank's Revolving Loans will thereafter be
maintained and for the account of which all payments of principal of,
and interest on, such Bank's Revolving Loans will thereafter be made.
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"Applicable Margin" shall mean, with respect to any LIBOR Loan
at any time, the per annum margin which is determined pursuant to the
Pricing Grid and added to the LIBO Rate for such LIBOR Loan; provided,
however, that each Applicable Margin determined pursuant to the Pricing
Grid shall be increased by two percent (2.00%) (a) on the date an Event
of Default of the type referred to in Subparagraph 6.01(a), 6.01(f) or
6.01(g) occurs and (b) on the date Administrative Agent provides
written notice to Borrower of the occurrence of any Event of Default
other than of the type referred to in Subparagraph 6.01(a), 6.01(f) or
6.01(g), and in each case shall continue at such increased rate unless
and until such Event of Default is waived in accordance with this
Agreement. The Applicable Margins shall be determined as provided in
the Pricing Grid and may change for each Pricing Period.
"Assignee Bank" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Assignment" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Assignment Agreement" shall have the meaning given to that
term in Subparagraph 8.05(c).
"Assignment Effective Date" shall have, with respect to each
Assignment Agreement, the meaning set forth therein.
"Assignor Bank" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Attorney Costs" of any Person shall mean and include all
reasonable fees and disbursements of any law firm or other external
counsel for such Person and, to the extent such services are not
redundant to those provided in the matter by external counsel for such
Person, the allocated cost of internal legal services and all
disbursements of internal counsel.
"Authorized Financial Officer" shall mean, with respect to
Borrower, the Chief Financial Officer or Treasurer of Borrower or any
Vice President of Finance of Borrower.
"Bank Parties" shall mean, collectively, the Banks and Issuing
Bank. Unless otherwise indicated, the term "Bank Parties" shall include
any Bank acting as Issuing Bank but not in its capacity as such.
"Banks" shall have the meaning given to that term in clause
(2) of the introductory paragraph hereof. Unless
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otherwise indicated, the term "Banks" shall include any Bank acting as
Issuing Bank but not in its capacity as such.
"Base Rate" shall mean, on any day, the greater of (a) the
Prime Rate in effect on such date and (b) the Federal Funds Rate for
such day plus one-half percent (0.50%); provided, however, that the
Base Rate shall be increased by two percent (2.00%) (a) on the date an
Event of Default of the type referred to in Subparagraph 6.01(a),
6.01(f) or 6.01(g) occurs and (b) on the date Administrative Agent
provides written notice to Borrower of the occurrence of any Event of
Default other than of the type referred to in Subparagraph 6.01(a),
6.01(f) or 6.01(g), and in each case shall continue at such increased
rate unless and until such Event of Default is waived in accordance
with this Agreement.
"Base Rate Loan" shall mean, at any time, a Revolving Loan
which then bears interest as provided in clause (i) of Subparagraph
2.01(c).
"Borrower" shall have the meaning given to that term in clause
(1) of the introductory paragraph hereof.
"Borrowing" shall mean a borrowing by Borrower consisting of
the Revolving Loans made by each of the Banks on the same date and of
the same Type pursuant to a single Notice of Borrowing.
"Business Day" shall mean any day other than Saturday and
Sunday on which (a) commercial banks are not authorized or required to
close in San Francisco, California or New York, New York and (b) if
such Business Day is related to a Revolving Loan which bears or is to
bear interest based on a LIBO Rate, dealings in Dollar deposits are
carried out in the London or other applicable interbank eurodollar
market.
"Capital Adequacy Requirement" shall have the meaning given to
that term in Subparagraph 2.10(d).
"Capital Leases" shall mean any and all lease obligations
that, in accordance with GAAP, are required to be capitalized on the
books of a lessee.
"Cash Equivalents" shall mean Investments of the type
permitted pursuant to clauses (i) through (iv), (vi), (viii) and
(xviii) in Subparagraph 5.02(e).
"Change of Control" shall mean with respect to Borrower, the
occurrence of any of the following events: (i) any person or group of
persons (within the meaning of Section 13 or 14 of the Securities
Exchange Act of 1934, as
4
amended) shall (A) acquire beneficial ownership (within the meaning of
Rule 13d-3 promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934, as amended) of forty percent (40%)
or more of the outstanding Equity Securities of Borrower entitled to
vote for members of the board of directors, or (B) acquire all or
substantially all of the assets of Borrower and its Subsidiaries taken
as a whole, or (ii) during any period of fifteen (15) consecutive
calendar months, individuals who are directors of Borrower on the first
day of such period ("Initial Directors") and any directors of Borrower
who are specifically approved by two-thirds of the directors of
Borrower who are Initial Directors or previously-approved Approved
Directors ("Approved Directors") shall cease to constitute a majority
of the Board of Directors of Borrower before the end of such period.
"Change of Law" shall have the meaning given to that term in
Subparagraph 2.10(b).
"CIBC" shall have the meaning given to that term in clause (3)
of the introductory paragraph hereof.
"Closing Date" shall mean the date when the initial Revolving
Loan is made or the initial Letter of Credit is issued.
"Co-Arrangers" shall have the meaning given to that term in
clause (3) of the introductory paragraph hereof.
"Co-Arrangers' Fee Letter" shall mean the letter agreement
dated the date of this Agreement among Borrower and the Co-Arrangers.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
"Commitment" shall mean, with respect to any Bank at any time,
such Lender's Proportionate Share at such time of the Total Commitment
at such time.
"Commitment Fee Percentage" shall mean, with respect to the
Unused Commitment at any time, a per annum rate which is determined
pursuant to the Pricing Grid.
"Commitment Fees" shall have the meaning given to that term in
Subparagraph 2.04(c).
"Compliance Certificate" shall have the meaning given to that
term in Subparagraph 5.01(a).
5
"Contingent Obligation" shall mean, with respect to any Person
without duplication, (a) any Guaranty Obligation of that Person; and
(b) any direct or indirect monetary obligation or liability, contingent
or otherwise, of that Person (i) in respect of any letter of credit or
similar instrument issued for the account of that Person or as to which
that Person is otherwise liable for reimbursement of drawings, (ii) to
purchase any materials, supplies or other property from, or to obtain
the services of, another Person if the relevant contract or other
related document or obligation requires that payment for such
materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or
other property is ever made or tendered, or such services are ever
performed or tendered if and to the extent such obligations are not
designated as accounts payable in accordance with GAAP, or (iii)
incurred pursuant to any interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements,
currency future or option contracts or other similar agreements
relating to interest rates or currencies. The amount of any Contingent
Obligation shall be deemed equal to the liability in respect thereof
reasonably anticipated in accordance with GAAP.
"Contractual Obligation" of any Person shall mean, any
indenture, note, lease, loan agreement, security, deed of trust,
mortgage, security agreement, guaranty, instrument, contract, agreement
or other form of contractual obligation or undertaking to which such
Person is a party or by which such Person or any of its property is
bound.
"Convertible Subordinated Debentures" shall mean the 5%
Convertible Subordinated Notes due 2003 in the original principal
amount of $241,350,000 issued by Borrower pursuant to the Indenture
dated February 15, 1996 between Borrower and LaSalle National Trust
Company, N.A., as Trustee.
"Credit Documents" shall mean and include the Loan Documents;
all documents, instruments and agreements delivered to any Agent or any
Bank Party pursuant to Paragraph 3.01; and all other documents,
instruments and agreements delivered by Borrower or any of its
Subsidiaries to any Agent or Bank Party in connection with this
Agreement on or after the date of this Agreement.
"Credit Event" shall mean the making of any Revolving Loan,
the issuance of any Letter of Credit or any amendment of any Letter of
Credit which increases its stated amount or extends its expiration
date.
6
"Default" shall have the meaning given to that term in
Paragraph 6.01.
"Defaulting Bank" shall mean a Bank which has failed to fund
its portion of any Borrowing which it is required to fund under this
Agreement and has continued in such failure for three (3) Business Days
after written notice from Administrative Agent.
"Disclosure Letter" shall mean the letter from Borrower to
Administrative Agent, dated the date of this Agreement, which
identifies itself as the "Disclosure Letter" under this Agreement.
"Dollars" and "$" shall mean the lawful currency of the United
States of America.
"Domestic Subsidiary" shall mean, with respect to any Person,
any Subsidiary of such Person which is created or organized in the
United States or under the laws of the United States or any state of
the United States.
"Drawing Payment" shall have the meaning given to that term in
Subparagraph 2.02(c).
"EBITDA" shall mean, with respect to any Person for any
period, the sum of the following, determined on a consolidated basis in
accordance with GAAP where applicable:
(a) The net income or net loss of such Person and its
Subsidiaries for such period before provision for income
taxes;
plus
(b) The sum (to the extent deducted in calculating
net income or loss in clause (a) above) of (i) all Interest
Expenses of such Person and its Subsidiaries accruing during
such period and (ii) all depreciation and amortization of such
Person and its Subsidiaries accruing during such period.
"Employee Benefit Plan" shall mean any employee benefit plan
within the meaning of section 3(3) of ERISA maintained or contributed
to by Borrower or any ERISA Affiliate, other than a Multiemployer Plan.
"Environmental Laws" shall mean all Requirements of Law
relating to the protection of human health and the environment,
including, without limitation, all Requirements of Law, pertaining to
reporting, licensing, permitting, transportation, storage, disposal,
investigation, and
7
remediation of emissions, discharges, releases, or threatened releases
of hazardous materials, chemical substances, pollutants, contaminants,
or hazardous or toxic substances, materials or wastes, whether solid,
liquid, or gaseous in nature, into the air, surface water, groundwater,
or land, or relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of chemical
substances, pollutants, contaminants, or hazardous or toxic substances,
materials, or wastes, whether solid, liquid, or gaseous in nature.
"Equity Securities" of any Person shall mean (a) all common
stock, preferred stock, participations, shares, partnership interests
or other equity interests in such Person (regardless of how designated
and whether or not voting or non-voting) and (b) all warrants, options
and other rights to acquire any of the foregoing, other than
convertible debt securities which have not been converted into common
stock, preferred stock, participations, shares, partnership interests
or other equity interests in any such Person.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as the same may from time to time be amended or supplemented,
including any rules or regulations issued in connection therewith.
"ERISA Affiliate" shall mean any Person which is treated as a
single employer with Borrower under Section 414 of the Code.
"Event of Default" shall have the meaning given to that term
in Paragraph 6.01.
"Executive Officer" shall mean, with respect to Borrower, the
Chairman, Chief Executive Officer, Chief Operating Officer, President,
Chief Financial Officer, Treasurer, General Counsel or Vice President
of Corporate Development and Planning of Borrower or any division
President or Executive Vice President of Borrower (or, if the titles
are changed, the persons having similar responsibilities for Borrower).
"External LC Agreement" shall mean the Credit Agreement dated
as of September 22, 1995 among Borrower, The Sumitomo Bank, Limited and
other banks from time to time parties thereto (as amended, modified and
supplemented from time to time in accordance with this Agreement), or
such other agreement between or among Borrower and any other financial
institution or financial institutions pursuant to which Borrower may
incur Indebtedness under letters of credit of
8
the type permitted under clause (vi) of Subparagraph 5.01(a).
"Federal Funds Rate" shall mean, for any day, the Federal
funds effective rate as set forth in the weekly statistical release
designated as H.15(519) published by the Federal Reserve Bank of New
York for such day, or in any successor publication (or, if such rate is
not so published for any day, the average rate quoted to Administrative
Agent on and for such day by three (3) Federal funds brokers of
recognized standing selected by Administrative Agent).
"Federal Reserve Board" shall mean the Board of Governors of
the Federal Reserve System.
"Financial Statements" shall mean, with respect to any
accounting period for any Person, consolidated statements of income,
shareholders' equity and cash flows of such Person for such period, and
a balance sheet of such Person as of the end of such period, setting
forth in each case in comparative form figures for the corresponding
period in the preceding fiscal year if such period is less than a full
fiscal year or, if such period is a full fiscal year, corresponding
figures from the preceding annual audit, all prepared in reasonable
detail and in accordance with GAAP.
"Funded Debt" of any Person shall mean, without duplication,
Indebtedness of the type set forth in clauses (a) - (f) of the
definition of "Indebtedness" less Cash or Cash Equivalents used as
collateral to secure any such Indebtedness.
"Funding Losses" shall mean, with respect to any repayment,
prepayment or conversion of any LIBOR Loan as set forth in clause (a)
of Paragraph 2.12, any failure to borrow any LIBOR Loan as set forth in
clause (b) of Paragraph 2.12 or any failure to convert into any LIBOR
Loan as set forth in clause (c) of Paragraph 2.12, the amount (which
shall not be less than zero) computed in accordance with the following
formula:
Funding Losses = (R-T) x P x D
--------------
360
where R = the interest rate that was or would have
been applicable to such LIBOR Loan;
T = the LIBO Rate for the date of such
repayment, prepayment, conversion, failure
to borrow or failure to convert for new
LIBOR Loans, of the same principal amount
made for an assumed Interest Period (the
"Remaining Period")
9
which begins on the date of such repayment,
prepayment, conversion, failure to borrow or
failure to convert and ends on the last day
of the actual Interest Period that was or
would have been applicable to the LIBOR Loan
that was repaid, prepaid or converted or
that was not borrowed or converted;
P = the principal amount of the LIBOR Loan that
was repaid, prepaid or converted or that was
not borrowed or converted; and
D = the number of days in the Remaining Period.
"GAAP" shall mean generally accepted accounting principles and
practices as in effect in the United States of America from time to
time, consistently applied.
"Governmental Authority" shall mean any domestic or foreign
national, state or local government, any political subdivision thereof,
any department, agency, authority or bureau of any of the foregoing, or
any other entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government,
including, without limitation, the Federal Deposit Insurance
Corporation, the Federal Reserve Board, the Comptroller of the
Currency, any central bank or any comparable authority.
"Governmental Charges" shall mean, with respect to any Person,
all levies, assessments, fees, claims or other charges imposed by any
Governmental Authority upon such Person or any of its property or
otherwise payable by such Person.
"Governmental Rule" shall mean any law, rule, regulation,
ordinance, order, code interpretation, judgment, decree, directive,
guidelines, policy or similar form of decision of any Governmental
Authority.
"Guaranty Obligation" shall mean, with respect to any Person,
any direct or indirect liability of that Person with respect to any
indebtedness, lease, dividend, letter of credit or other obligation
(the "primary obligations") of another Person (the "primary obligor"),
including any obligation of that Person, whether or not contingent, (a)
to purchase, repurchase or otherwise acquire such primary obligations
or any property constituting direct or indirect security therefor, or
(b) to advance or provide funds (i) for the payment or discharge of any
such primary obligation, or (ii) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth
or solvency or any balance sheet item, level of
10
income or financial condition of the primary obligor, or (c) to
purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation (except to
the extent of the fair market value of such property, securities or
services to be purchased), or (d) otherwise to assure or hold harmless
the holder of any such primary obligation against loss in respect
thereof. The amount of any Guaranty Obligation shall be deemed equal to
the liability in respect thereof reasonably anticipated under GAAP.
"Hazardous Materials" shall mean all materials, substances and
wastes which are classified or regulated as "hazardous," "toxic" or
similar descriptions under any Environmental Law or which are
hazardous, toxic, harmful or dangerous to human health.
"Indebtedness" of any Person shall mean, without duplication
(in each case, measured in accordance with GAAP):
(a) All monetary obligations of such Person evidenced
by notes, bonds, debentures or other similar instruments and
all other obligations of such Person for borrowed money;
(b) All monetary obligations of such Person for the
deferred purchase price of property or services (including
obligations under letters of credit and other credit
facilities which secured or financed such purchase price),
other than trade payables incurred by such Person in the
ordinary course of its business on ordinary terms;
(c) All monetary obligations of such Person under
conditional sale or other title retention agreements with
respect to property acquired by such Person other than
pursuant to leases classified as operating leases under GAAP
(to the extent of the value of such property if the rights and
remedies of the seller or lender under such agreement in the
event of default are limited solely to repossession or sale of
such property);
(d) All monetary obligations of such Person as lessee
with respect to the capitalized portion of Capital Leases of
such Person (other than capitalized interest) calculated in
accordance with GAAP;
(e) all monetary obligations of such Person (other
than inchoate indemnity obligations) with
11
respect to any Synthetic Leases; provided, however, that the
amount of monetary obligations for the purpose of this clause
(e) shall be equal to the aggregate present value of scheduled
rental payments under each such Synthetic Lease (excluding any
component thereof in the nature of operating expenses, taxes
or similar obligations), together with the purchase price
payable by such Person at the end of such Synthetic Lease,
discounted by the interest rate implicit in such Synthetic
Lease;
(f) all monetary obligations of such Person (other
than inchoate indemnity obligations) with respect to any sale,
transfer or assignment of accounts receivable and related
rights and property by such Person with recourse to such
Person;
(g) All monetary obligations of such Person,
contingent or otherwise, under or with respect to letters of
credit, banker's acceptances or other similar facilities;
(h) All monetary obligations of such Person,
contingent or otherwise, under or with respect to interest
rate swap, cap or collar agreements, interest rate future or
option contracts, currency swap agreements, currency future or
option contracts or other similar agreements relating to
interest rates or currencies;
(i) All Contingent Obligations of such Person with
respect to the obligations of such Person or other Persons of
the types described in clauses (a) - (h) above; and
(j) All obligations of other Persons of the types
described in clauses (a) - (h) above to the extent secured by
(or for which any holder of such obligations has an existing
right, contingent or otherwise, to be secured by) any Lien in
any property (including accounts and contract rights) owned by
such Person, even though such person has not assumed or become
liable for the payment of such obligations; provided, however,
that the amount of such Indebtedness under this clause (j)
shall be the lesser of (i) the fair market value of the
property subject to such Lien and (ii) the amount of the
monetary obligations of such other Person.
"Interest Account" shall have the meaning given to that term
in Subparagraph 2.07(b).
12
"Interest Expenses" shall mean, with respect to any Person for
any period, the sum, determined on a consolidated basis in accordance
with GAAP, of (a) all interest accruing on the indebtedness of such
Person during such period (including interest attributable to Capital
Leases and financing charges attributable to Synthetic Leases whether
calculated as interest expenses or rental expenses), (b) all letter of
credit fees payable by such Person accruing during such period and (c)
interest or discount associated with Permitted Receivables Facilities
not otherwise included in clause (a) above.
"Interest Period" shall mean, with respect to any LIBOR Loan,
the time periods selected by Borrower pursuant to Subparagraph 2.01(b)
or Subparagraph 2.01(d) which commences on the first day of such
Revolving Loan or the effective date of any conversion and ends on the
last day of such time period, and thereafter, each subsequent time
period selected by Borrower pursuant to Subparagraph 2.01(e) which
commences on the last day of the immediately preceding time period and
ends on the last day of that time period.
"Investment" of any Person shall mean any loan or advance of
funds by such Person to any other Person (other than advances to
employees of such Person for moving and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business or
the purchase by such Person in the ordinary course of business of
residences for employees in connection with the relocation by such
Person of such employees), any purchase or other acquisition of any
Equity Securities or Indebtedness of any other Person, any capital
contribution by such Person to or any other investment by such Person
in any other Person (including any Guaranty Obligations of such Person
and any Indebtedness of such Person of the type described in clause (j)
of the definition of "Indebtedness" on behalf of any other Person);
provided, however, that Investments shall not include (a) accounts
receivable or other indebtedness owed by customers of such Person which
are current assets and arose from sales of inventory or the performance
of services in the ordinary course of such Person's business or (b)
prepaid expenses of such Person incurred and prepaid in the ordinary
course of business.
"Issuing Bank" shall mean a Bank selected by Borrower and
approved by Administrative Agent and the Co-Arrangers in their
reasonable discretion that has agreed to act as issuing bank hereunder
and issue one or more Letters of Credit pursuant to Paragraph 2.02.
"LC Application" shall have the meaning given to that term in
Subparagraph 2.02(b).
13
"LC Availability Date" shall mean the day on or after the
Closing Date that an Issuing Bank has been selected by Borrower and
approved by Administrative Agent and the Co- Arrangers in accordance
with this Agreement.
"LC Commitment" shall have the meaning given to that term in
Subparagraph 2.02(a).
"LC Facility Expiration Date" shall have the meaning given to
that term in Subparagraph 2.02(a).
"LC Issuance Fees" shall have the meaning given to that term
in Subparagraph 2.04(d).
"LC Usage Fee" shall have the meaning given to that term in
Subparagraph 2.04(d).
"LC Usage Fee Rate" shall mean, with respect to Letters of
Credit, the per annum rate which is determined pursuant to the Pricing
Grid and used to calculate the LC Usage Fee.
"Letter of Credit" shall have the meaning given to that term
in Subparagraph 2.02(a).
"LIBO Rate" shall mean, with respect to any Interest Period
for the LIBOR Loans in any Borrowing, a rate per annum equal to the
quotient of (a) the arithmetic mean (rounded upward if necessary to the
nearest 1/16 of one percent) of the rates per annum appearing on the
Reuters screen LIBO page (or any successor publication) on the second
Business Day prior to the first day of such Interest Period at or about
11:00 A.M. (London time) (for delivery on the first day of such
Interest Period) for a term comparable to such Interest Period, divided
by (b) one minus the Reserve Requirement for such Revolving Loans in
effect from time to time. If for any reason rates are not available as
provided in clause (a) of the preceding sentence, the rate to be used
in clause (a) shall be, at the Administrative Agent's discretion, (i)
the rate per annum at which Dollar deposits are offered to the
Administrative Agent in the London interbank eurodollar currency market
or (ii) the rate at which Dollar deposits are offered to the
Administrative Agent in, or by the Administrative Agent to major banks
in, any offshore interbank eurodollar market selected by the
Administrative Agent, in each case on the second Business Day prior to
the commencement of such Interest Period at or about 10:00 A.M. (New
York time) (for delivery on the first day of such Interest Period) for
a term comparable to such Interest Period and in an amount
approximately equal to the amount of the Revolving Loan to be made or
funded by the Administrative Agent as part of such Borrowing.
14
"LIBOR Loan" shall mean, at any time, a Revolving Loan which
then bears interest as provided in clause (ii) of Subparagraph 2.01(c).
"Lien" shall mean, with respect to any property, any security
interest, mortgage, pledge, lien or other encumbrance in, of, or on
such property or the income therefrom, including, without limitation,
the interest of a vendor or lessor under a conditional sale agreement,
Capital Lease or other title retention agreement.
"Loan Documents" shall mean this Agreement, the Notes, the
Agents' Fee Letter, the LC Applications, each Notice of Borrowing, each
Compliance Certificate and each additional certificate delivered by
Borrower or any of its Subsidiaries from time to time pursuant to the
terms of this Agreement or any such other Loan Documents.
"Majority Banks" shall mean (a) at any time Revolving Loans
are outstanding and the Banks are obligated to make Revolving Loans
pursuant to their Commitments, Banks holding more than fifty-one
percent (51%) of the aggregate principal amount of all Revolving Loans
outstanding, calculated as if Revolving Loans in the full amount of the
Banks' Commitments were outstanding, (b) at any time Revolving Loans
are outstanding and the Banks are not obligated to make Revolving Loans
pursuant to their Commitments, Banks holding more than fifty-one
percent (51%) of the aggregate principal amount of all Revolving Loans
outstanding and (c) at any time no Revolving Loans are outstanding,
Banks whose aggregate Commitments exceed fifty-one percent (51%) of the
Total Commitment at such time.
"Margin Stock" shall have the meaning given to that term in
Regulation U issued by the Federal Reserve Board, as amended from time
to time, and any successor regulation thereto.
"Material Adverse Effect" shall mean a material adverse effect
on (a) the business, assets, operations or financial or other condition
of Borrower and its Subsidiaries taken as a whole; (b) the ability of
Borrower to pay or perform the Obligations in accordance with the terms
of this Agreement and the other Credit Documents; or (c) the rights and
remedies of the Agents and the Bank Parties under this Agreement or any
other Credit Documents taken as a whole.
"Material Subsidiaries" shall mean each Subsidiary of Borrower
which has assets with a total book value greater than ten percent (10%)
of the consolidated total assets of Borrower and its Subsidiaries, each
determined as of the end
15
of the fiscal quarter immediately preceding the date of determination.
"Maturity" shall mean, with respect to any Revolving Loan,
Reimbursement Obligation, interest, fee or other amount payable by
Borrower under this Agreement or the other Credit Documents, the date
such Revolving Loan, interest, Reimbursement Obligation, fee or other
amount becomes due, whether upon the stated maturity or due date, upon
acceleration or otherwise.
"Maturity Date" shall have the meaning given to that term in
Subparagraph 2.01(a).
"MKE" shall mean Matsushita-Kotobuki Electronics Industries,
Ltd., a Japanese corporation.
"MKE-Quantum" shall mean MKE-Quantum Components, L.L.C., a
Delaware limited liability company.
"Moody's" means Xxxxx'x Investors Service, Inc. and any
successor thereto that is a nationally-recognized rating agency.
"Multiemployer Plan" shall mean any multiemployer plan within
the meaning of section 3(37) of ERISA maintained or contributed to by
Borrower or any ERISA Affiliate.
"Net Proceeds" shall mean with respect to any sale or issuance
of any Equity Security or other security by any Person (including in
the case of Borrower, any sale or issuance of any Subordinated Debt),
the aggregate consideration received by such Person from such sale or
issuance less the actual amount of fees and commissions payable to
Persons other than such Person or any Affiliate of such Person.
"Note" shall have the meaning given to that term in
Subparagraph 2.07(a).
"Notice of Borrowing" shall have the meaning given to that
term in Subparagraph 2.01(b).
"Notice of Conversion" shall have the meaning given to that
term in Subparagraph 2.01(d).
"Notice of Interest Period Selection" shall have the meaning
given to that term in Subparagraph 2.01(e).
"Obligations" shall mean and include, with respect to
Borrower, all loans, advances, debts, liabilities, and obligations,
howsoever arising, owed by Borrower to any
16
Agent or any Bank Party of every kind and description (whether or not
evidenced by any note or instrument and whether or not for the payment
of money), direct or indirect, absolute or contingent, due or to become
due, now existing or hereafter arising pursuant to the terms of this
Agreement or any of the other Credit Documents, including without
limitation all interest, fees, charges, expenses, attorneys' fees and
accountants' fees chargeable to Borrower or payable by Borrower
hereunder or thereunder.
"Origination Fees" shall have the meaning given to that term
in Subparagraph 2.04(b).
"Outstanding Facilities Credit" shall have the meaning given
to that term in Subparagraph 2.03(a).
"Participant" shall have the meaning given to that term in
Subparagraph 8.05(b).
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Indebtedness" shall have the meaning given to that
term in Subparagraph 5.02(a).
"Permitted Investments" shall have the meaning given to that
term in Subparagraph 5.02(e).
"Permitted Liens" shall have the meaning given to that term in
Subparagraph 5.02(b).
"Permitted Receivables Facility" shall mean one or more
accounts receivable financing arrangements including (a) the sale of
accounts receivables and any related property by Borrower and/or any of
its Subsidiaries to a financing party or a special purpose vehicle,
and/or (b) the granting of a security interest in accounts receivable
and any related property by Borrower and/or any of its Subsidiaries;
provided, however, that the aggregate outstanding advances under such
accounts receivables financing arrangements shall not exceed
$200,000,000 at any one time.
"Person" shall mean and include an individual, a partnership,
a corporation (including a business trust), a limited liability
company, a joint stock company, an unincorporated association, a joint
venture, a trust or other entity or a Governmental Authority.
"Pricing Grid" shall mean Schedule II.
"Pricing Period" shall mean (a) the period commencing on the
date of this Agreement and ending on September 30,
17
1997, (b) the period commencing on October 1, 1997 and ending on
November 30, 1997, and (c) each consecutive three-calendar month
period, four-calendar month period, two-calendar month period or
three-calendar month period (as applicable) thereafter which commences
on the day following the last day of the immediately preceding
three-calendar month period, four-calendar month period, two-calendar
month period or three-calendar month period (as applicable) and ends on
the last day of that time period as follows:
(i) December 1st through February 28th or February
29th (as applicable);
(ii) March 1st through June 30th;
(iii) July 1st through August 31st; and
(iv) September 1st through November 30th.
"Prime Rate" shall mean the per annum rate publicly announced
by the Administrative Agent from time to time at its New York Branch.
The Prime Rate is determined by the Administrative Agent from time to
time as a means of pricing credit extensions to some customers and is
neither directly tied to any external rate of interest or index nor
necessarily the lowest rate of interest charged by the Administrative
Agent at any given time for any particular class of customers or credit
extensions. Any change in the Base Rate resulting from a change in the
Prime Rate shall become effective on the Business Day on which each
change in the Prime Rate occurs.
"Prior Credit Agreement" shall have that certain Credit
Agreement, dated as of October 4, 1994, as amended, among Borrower, the
banks named therein, ABN, Barclays Bank PLC and CIBC, as managing
agents for the banks, and Canadian Imperial Bank of Commerce, as
administrative agent for the banks.
"Proportionate Share" shall mean, with respect to each Bank,
the percentage set forth under the caption "Proportionate Share"
opposite such Bank's name on Schedule I, or, if changed, such
percentage as may be set forth for such Bank in the Register.
"Quick Ratio" shall mean, with respect to Borrower at any
time, the ratio, determined on a consolidated basis in accordance with
GAAP, of:
(a) The sum at such time of all (i) cash and Cash
Equivalents of Borrower and its Subsidiaries (excluding
restricted cash) and (ii) accounts receivable of
18
Borrower and its Subsidiaries, less all reserves therefor;
to
(b) The sum at such time of (i) the current
liabilities of Borrower and its Subsidiaries plus (ii)
long-term Indebtedness secured by account receivables of
Borrower or its Subsidiaries measured at the lesser of the
amount of such long-term Indebtedness and the book value of
the accounts receivable so encumbered.
"Register" shall have the meaning given to that term in
Subparagraph 8.05(d).
"Reimbursement Obligation" shall have the meaning given to
that term in Subparagraph 2.02(c).
"Reimbursement Payment" shall have the meaning given to that
term in Subparagraph 2.02(c).
"Reportable Event" shall have the meaning given to that term
in ERISA and applicable regulations thereunder.
"Requirement of Law" applicable to any Person shall mean (a)
the Articles or Certificate of Incorporation and By-laws, Partnership
Agreement, Operating Agreement or other organizational or governing
documents of such Person, (b) any Governmental Rule binding upon such
Person, (c) any license, permit, approval or other authorization
granted by any Governmental Authority to or for the benefit of such
Person or (d) any final judgment, decision or determination of any
Governmental Authority or arbitrator, in each case applicable to or
binding upon such Person or any of its property or to which such Person
or any of its property is subject.
"Reserve Requirement" shall mean, with respect to any day in
an Interest Period for a LIBOR Loan, the aggregate of the reserve
requirement rates (expressed as a decimal) in effect on such day for
eurocurrency funding (currently referred to as "Eurocurrency
liabilities" in Regulation D of the Federal Reserve Board) maintained
by a member bank of the Federal Reserve System. As used herein, the
term "reserve requirement" shall include, without limitation, any
basic, supplemental or emergency reserve requirements imposed on Bank
by any Governmental Authority.
"Revolving Loan" shall have the meaning given to that term in
Subparagraph 2.01(a).
19
"S&P" means Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., and any successor thereto that is a
nationally-recognized rating agency.
"Senior Funded Debt" of any Person shall mean any Funded Debt
which is not Subordinated Debt.
"Senior Funded Debt Ratio" shall mean, with respect to any
Person at any time, the ratio, determined on a consolidated basis in
accordance with GAAP, of:
(a) The total Senior Funded Debt of such Person and
its Subsidiaries at such time;
to
(b) The sum at such time of (i) the total Senior
Funded Debt and Subordinated Debt of such Person and its
Subsidiaries at such time plus (ii) the total Tangible Net
Worth of such Person and its Subsidiaries at such time.
"Senior Indebtedness" shall mean, with respect to any Person
at any time, all Indebtedness of such Person other than Subordinated
Debt.
"Solvent" shall mean, with respect to any Person on any date,
that on such date (a) the fair value of the assets of such Person is
greater than the fair value of the liabilities (including, without
limitation, contingent liabilities) of such Person, as such value is
established and liabilities evaluated for purposes of Section 101(31)
of the Federal Bankruptcy Reform Act of 1978 (12 U.S.C. ss.101, et
seq.) and, in the alternative, the California Uniform Fraudulent
Transfer Act, (b) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability
to pay as such debts and liabilities mature and (c) such Person is not
engaged in business or a transaction, and is not about to engage in
business or a transaction, for which such Person's property would
constitute an unreasonably small capital.
"Subordinated Debt" shall mean the Convertible Subordinated
Debentures and any other subordinated debt permitted by Subparagraph
5.02(a).
"Subsidiary" of any Person shall mean (a) any corporation of
which 50% or more of the issued and outstanding Equity Securities
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital
20
stock of any other class or classes of such corporation shall or might
have voting power upon the occurrence of any contingency) is at the
time directly or indirectly owned or controlled by such Person, by such
Person and one or more of its other Subsidiaries or by one or more of
such Person's other Subsidiaries or (b) any partnership, joint venture,
or other association of which 50% or more of the equity interest having
the power to vote, direct or control the management of such
partnership, joint venture or other association is at the time owned
and controlled by such Person, by such Person and one or more of the
other Subsidiaries or by one or more of such Person's other
Subsidiaries and in each case, only if such Person is included in the
Financial Statements of such Person on a consolidated basis.
"Synthetic Lease" shall mean an off-balance sheet financing
arrangement for equipment or real estate which is treated as an
operating lease under GAAP but pursuant to which the lessee of such
equipment or real estate has the benefits and burdens of ownership of
the leased equipment or real estate for U.S. tax purposes.
"Tangible Net Worth" shall mean, with respect to Borrower and
its Subsidiaries at any time, the remainder at such time, determined on
a consolidated basis in accordance with GAAP, of (a) the total assets
of Borrower and its Subsidiaries minus (b) the sum (without limitation
and without duplication of deductions) of (i) the total liabilities of
Borrower and its Subsidiaries, (ii) all reserves established by
Borrower and its Subsidiaries for anticipated losses and expenses (to
the extent not deducted in calculating total assets in clause (a)
above), and (iii) all intangible assets of Borrower and its
Subsidiaries (to the extent included in calculating total assets in
clause (a) above), including, without limitation, goodwill (including
any amounts, however designated on the balance sheet, representing the
cost of acquisition of businesses and investments in excess of
underlying tangible assets), trademarks, trademark rights, trade name
rights, copyrights, patents, patent rights, licenses, unamortized debt
discount, marketing expenses, organizational expenses, non-compete
agreements and deferred research and development.
"Taxes" shall have the meaning given to such term in
Subparagraph 2.11(a).
"Total Commitment" shall have the meaning given to that term
in Subparagraph 2.01(a).
"Total Funded Debt Ratio" shall mean, with respect to
Borrower, as of the last day of any quarter, the ratio,
21
determined on a consolidated basis in accordance with GAAP, of (a) the
aggregate amount of all Funded Debt of Borrower then outstanding on
such day to (b) EBITDA of Borrower for the consecutive four quarter
period ending on such day.
"Transfers" shall mean, with respect to any assets or
property, any sale, lease, transfer or other disposition thereof.
"Type" shall mean, with respect to any Revolving Loan or
Borrowing at any time, the classification of such Revolving Loan or
Borrowing by the type of interest rate it then bears, whether an
interest rate based on the Base Rate or the LIBO Rate.
"UCP" shall have the meaning given to that term in
Subparagraph 2.02(a).
"Unused Commitment" shall mean, at any time after this
Agreement is executed by Borrower, the Agents and Banks, the remainder
of (a) the Total Commitment at such time minus (b) the sum of the
aggregate principal amount of all Revolving Loans then outstanding and
the aggregate stated amount of all Letters of Credit then outstanding.
"Wholly-Owned Subsidiary" shall mean any Subsidiary in which
(other than directors' qualifying or local ownership shares required by
law) 100% of the issued and outstanding Equity Securities or equity
interest (as applicable) having ordinary voting power to elect a
majority of the Board of Directors of such Subsidiary or direct or
control the management of such Subsidiary (as applicable) is at the
time owned and controlled by a Person, by such Person and one or more
of the other Subsidiaries or by one or more of such Person's other
Subsidiaries.
1.02. GAAP. Unless otherwise indicated in this Agreement or any other
Credit Document, all accounting terms used in this Agreement or any other Credit
Document shall be construed, and all accounting and financial computations
hereunder or thereunder shall be computed, in accordance with GAAP. If GAAP
changes in any material respect during the term of this Agreement such that any
covenants contained herein would then be calculated in a different manner or
with different components, Borrower, the Banks and Agents agree to negotiate in
good faith to amend this Agreement in such respects as are necessary to conform
those covenants as criteria for evaluating Borrower's financial condition to
substantially the same criteria as were effective prior to such change in GAAP;
provided, however, that, until Borrower, the Banks and Agents so amend this
Agreement, all such covenants shall be calculated in accordance with GAAP as in
effect immediately prior to such change.
22
1.03. Headings. Headings in this Agreement and each of the other Credit
Documents are for convenience of reference only and are not part of the
substance hereof or thereof.
1.04. Plural Terms. All terms defined in this Agreement or any other
Credit Document in the singular form shall have comparable meanings when used in
the plural form and vice versa.
1.05. Time. All references in this Agreement and each of the other
Credit Documents to a time of day shall mean New York time unless otherwise
indicated.
1.06. Governing Law. This Agreement and each of the other Credit
Documents (unless otherwise provided in such other Credit Documents) shall be
governed by and construed in accordance with the laws of the State of California
without reference to conflicts of law rules.
1.07. Construction. This Agreement is the result of negotiations among,
and has been reviewed by, Borrower, each Bank, each Agent and their respective
counsel. Accordingly, this Agreement shall be deemed to be the product of all
parties hereto, and no ambiguity shall be construed in favor of or against
Borrower, any Bank or any Agent.
1.08. Entire Agreement. This Agreement, the Agents' Fee Letters and
each of the other Credit Documents, taken together, constitute and contain the
entire agreement of Borrower, the Banks and Agents and supersede any and all
prior agreements, negotiations, correspondence, understandings and
communications among the parties, whether written or oral, respecting the
subject matter hereof.
1.09. Calculation of Interest and Fees. All calculations of interest
and fees under this Agreement and the other Credit Documents for any period (a)
shall include the first day of such period and exclude the last day of such
period and (b) shall be calculated on the basis of a year of 360 days for actual
days elapsed, except that during any period any Revolving Loan bears interest
based upon the Base Rate, such interest shall be calculated on the basis of a
year of 365 or 366 days, as appropriate, for actual days elapsed.
1.10. Other Interpretive Provisions. References in this Agreement to
"Recitals," "Sections," "Paragraphs," "Subparagraphs," "Exhibits" and
"Schedules" are to recitals, sections, paragraphs, subparagraphs, exhibits and
schedules herein and hereto unless otherwise indicated. References in this
Agreement and each of the other Credit Documents to any document, instrument or
agreement (a) shall include all exhibits, schedules and other attachments
thereto, (b) shall include all documents, instruments or agreements issued or
executed in replacement
23
thereof and (c) shall mean such document, instrument or agreement, or
replacement or predecessor thereto, as amended, modified and supplemented from
time to time and in effect at any given time. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement or any other
Credit Document shall refer to this Agreement or such other Credit Document, as
the case may be, as a whole and not to any particular provision of this
Agreement or such other Credit Document, as the case may be. The words "include"
and "including" and words of similar import when used in this Agreement or any
other Credit Document shall not be construed to be limiting or exclusive. In the
event of any inconsistency between the terms of this Agreement and the terms of
any other Credit Document, the terms of this Agreement shall govern.
SECTION II. CREDIT FACILITIES.
2.01. Revolving Loan Facility.
(a) Revolving Loan Availability. Subject to the terms and
conditions of this Agreement (including the amount limitations set
forth in Paragraph 2.03), each Bank severally agrees to advance to
Borrower from time to time during the period beginning on the Closing
Date and ending on June 6, 2000 (the "Maturity Date") such revolving
loans as Borrower may request under this Paragraph 2.01 (individually,
a "Revolving Loan"); provided, however, that (i) the aggregate
principal amount of all Revolving Loans made by such Bank at any time
outstanding shall not exceed such Bank's Commitment at such time and
(ii) the aggregate principal amount of all Revolving Loans made by all
Banks at any time outstanding shall not exceed Five Hundred Million
Dollars ($500,000,000) (such amount, as reduced from time to time
pursuant to this Agreement, to be referred to herein as the "Total
Commitment"). All Revolving Loans shall be made on a pro rata basis by
the Banks in accordance with their respective Proportionate Shares,
with each Borrowing to be comprised of a Revolving Loan by each Bank
equal to such Bank's Proportionate Share of such Borrowing. Except as
otherwise provided herein, Borrower may borrow, repay and reborrow
Revolving Loans until the Maturity Date.
(b) Notice of Borrowing. Borrower shall request each Borrowing
by delivering to Administrative Agent an irrevocable written notice in
the form of Exhibit A, appropriately completed (a "Notice of
Borrowing"), which specifies, among other things:
(i) The principal amount of the requested Borrowing,
which shall be in the amount of (A) $1,000,000 or an integral
multiple of $500,000 in
24
excess thereof in the case of a Borrowing consisting of Base
Rate Loans or (B) $10,000,000 or an integral multiple of
$500,000 in excess thereof in the case of a Borrowing
consisting of LIBOR Loans;
(ii) Whether the requested Borrowing is to consist of
Base Rate Loans or LIBOR Loans;
(iii) If the requested Borrowing is to consist of
LIBOR Loans, the initial Interest Period selected by Borrower
for such LIBOR Loans in accordance with Subparagraph 2.01(e);
and
(iv) The date of the requested Borrowing, which shall
be a Business Day.
Borrower shall give each Notice of Borrowing to Administrative Agent at
least three (3) Business Days before the date of the requested
Borrowing in the case of a Borrowing consisting of LIBOR Loans and at
least one (1) Business Day before the date of the requested Borrowing
in the case of a Borrowing consisting of Base Rate Loans. Each Notice
of Borrowing shall be delivered by first-class mail or facsimile to
Administrative Agent at the office or facsimile number and during the
hours specified in Paragraph 8.01; provided, however, that Borrower
shall promptly deliver to Administrative Agent the original of any
Notice of Borrowing initially delivered by facsimile. Borrower may
request that one or more Borrowings be made on the same day.
Administrative Agent shall promptly notify each Bank of the contents of
each Notice of Borrowing and of the amount and Type of (and, if
applicable, the Interest Period for) each Revolving Loan to be made by
such Bank as part of the requested Borrowing.
(c) Interest Rates. Borrower shall pay interest on the unpaid
principal amount of each Revolving Loan from the date of such Revolving
Loan until the maturity thereof, at one of the following rates per
annum:
(i) During such periods as such Revolving Loan is a
Base Rate Loan, at a rate per annum equal to the Base Rate,
such rate to change from time to time as the Base Rate shall
change; and
(ii) During such periods as such Revolving Loan is a
LIBOR Loan, at a rate per annum equal at all times during each
Interest Period for such LIBOR Loan to the LIBO Rate for such
Interest Period plus the Applicable Margin therefor, such rate
to change from time to time during such Interest Period as the
Applicable Margin shall change;
25
Provided, however, that all Revolving Loans outstanding during the
period commencing on the Closing Date and ending three (3) Business
Days after the Closing Date shall be Base Rate Loans. All Revolving
Loans in each Borrowing shall, at any given time prior to maturity,
bear interest at one, and only one, of the above rates. The number of
Borrowings consisting of LIBOR Loans shall not exceed twenty (20) at
any time.
(d) Conversion of Revolving Loans. Borrower may convert any
Borrowing from one Type of Borrowing to the other Type. Borrower shall
request such a conversion by an irrevocable written notice to
Administrative Agent in the form of Exhibit B, appropriately completed
(a "Notice of Conversion"), which specifies, among other things:
(i) The Borrowing which is to be converted;
(ii) The Type of Revolving Loans into which such
Revolving Loans are to be converted;
(iii) If such Borrowing is to be converted into a
Borrowing consisting of LIBOR Loans, the initial Interest
Period selected by Borrower for such Revolving Loans in
accordance with Subparagraph 2.01(e); and
(iv) The date of the requested conversion, which
shall be a Business Day.
Borrower shall give each Notice of Conversion to Administrative Agent
at least three (3) Business Days before the date of the requested
conversion in the case of a conversion into a Revolving Loan consisting
of LIBOR Loans. If Borrower fails to give such Notice of Conversion at
least three (3) Business Days before the date of the requested
conversion, such Revolving Loan shall automatically convert into a
Revolving Loan consisting of Base Rate Loans. Each Notice of Conversion
shall be delivered by first-class mail or facsimile to Administrative
Agent at the office or to the facsimile number and during the hours
specified in Paragraph 8.01; provided, however, that Borrower shall
promptly deliver to Administrative Agent the original of any Notice of
Conversion initially delivered by facsimile. Administrative Agent shall
promptly notify each Bank of the contents of each Notice of Conversion.
(e) LIBOR Loan Interest Periods.
(i) The initial and each subsequent Interest Period
selected by Borrower for a LIBOR Loan shall be one (1), two
(2), three (3) or six (6) months as Borrower may specify;
provided, however, that (A) any
26
Interest Period which would otherwise end on a day which is
not a Business Day shall be extended to the next succeeding
Business Day unless such next Business Day falls in another
calendar month, in which case such Interest Period shall end
on the immediately preceding Business Day; (B) any Interest
Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of a
calendar month; and (C) no Interest Period shall end after the
Maturity Date.
(ii) Borrower shall notify Administrative Agent by an
irrevocable written notice in the form of Exhibit C,
appropriately completed (a "Notice of Interest Period
Selection"), at least three (3) Business Days prior to the
last day of each Interest Period for LIBOR Loans of the
Interest Period selected by Borrower for the next succeeding
Interest Period for such Revolving Loans. Each Notice of
Interest Period Selection shall be given by first-class mail
or facsimile to the office or the facsimile number and during
the hours specified in Paragraph 8.01; provided, however, that
Borrower shall promptly deliver to Administrative Agent the
original of any Notice of Interest Period Selection initially
delivered by facsimile. If Borrower fails to notify
Administrative Agent of the next Interest Period for LIBOR
Loans in accordance with this Subparagraph 2.01(e), such LIBOR
Loans shall automatically convert to Base Rate Loans on the
last day of the current Interest Period therefor.
(f) Scheduled Revolving Loan Payments. Borrower shall repay
the unpaid principal amount of all Revolving Loans on the Maturity
Date. Borrower shall pay accrued interest on the unpaid principal
amount of the Revolving Loans in arrears (i) in the case of Base Rate
Loans, on the last Business Day in each calendar quarter; (ii) in the
case of LIBOR Loans, on the last day of each Interest Period therefor
(and, if any such Interest Period is longer than three (3) months,
every three (3) months after the first day of such Interest Period);
and (iii) in the case of all Revolving Loans, at maturity.
(g) Purpose. Borrower shall use the proceeds of the Revolving
Loans (i) to refinance the loans outstanding under the Prior Credit
Agreement on the Closing Date and (ii) to finance Borrower's working
capital and general corporate needs.
27
2.02. Letter of Credit Facility.
(a) Letter of Credit Availability. Subject to the terms and
conditions of this Agreement (including the amount limitations set
forth in Paragraph 2.03, Issuing Bank shall issue on behalf of Borrower
from time to time during the period beginning on the LC Availability
Date and ending on the date which is fifteen (15) days prior to the
Maturity Date (the "LC Facility Expiration Date") such letters of
credit as Borrower may request under this Paragraph 2.02 (individually,
a "Letter of Credit"); provided, however, as follows:
(i) The aggregate amount available for drawing under
all Letters of Credit at any time outstanding shall not exceed
One Hundred Million Dollars ($100,000,000) (such amount, as
reduced from time to time pursuant to this Agreement, to be
referred to herein as the "LC Commitment").
(ii) Each Letter of Credit shall be an irrevocable
performance standby Letter of Credit.
(iii) Each Letter of Credit shall expire on or prior
to the LC Facility Expiration Date.
(iv) Each Letter of Credit shall be governed by the
Uniform Customs and Practices for Documentary Credits as most
recently published by the International Chamber of Commerce
(the "UCP") prior to the date of issuance of such Letter of
Credit and the terms of the UCP are hereby incorporated by
reference with respect to each Letter of Credit.
(v) Each Letter of Credit shall be in a form
reasonably acceptable to Issuing Bank.
Except as otherwise provided herein, Borrower may request Letters of
Credit, cause or allow Letters of Credit to expire and request
additional Letters of Credit until the LC Facility Expiration Date.
(b) LC Application. Borrower shall request each Letter of
Credit by delivering to Administrative Agent and Issuing Bank an
irrevocable written application in a form reasonably acceptable to
Issuing Bank (it being understood that such form shall not contain
terms inconsistent with the terms set forth in this Agreement),
appropriately completed (an "LC Application"), which specifies, among
other things:
(i) The stated amount of the requested Letter of
Credit;
28
(ii) The name and address of the beneficiary of the
requested Letter of Credit;
(iii) The expiration date of the requested Letter of
Credit;
(iv) The documentary conditions for drawing under the
requested Letter of Credit;
(v) The date of issuance for the requested Letter of
Credit, which shall be a Business Day; and
(vi) The aggregate amount available for drawing under
all Letters of Credit then outstanding.
Borrower shall give each LC Application to Issuing Bank at least five
(5) Business Days before the proposed date of issuance of the requested
Letter of Credit. Each LC Application shall be delivered by an
established express courier service, first-class mail or facsimile to
Administrative Agent and Issuing Bank at their respective offices or
facsimile numbers and during the hours specified in Paragraph 8.01;
provided, however, that Borrower shall promptly deliver to Issuing Bank
the original of any LC Application initially delivered by facsimile.
Administrative Agent shall promptly notify each Bank of the contents of
each LC Application. In the event of any conflict between the terms of
this Agreement and the terms of any LC Application, the terms of this
Agreement shall control.
(c) Disbursement and Reimbursement.
(i) Disbursement. Issuing Bank will notify Borrower
by facsimile forthwith upon receipt of the presentment of any
demand for payment under any Letter of Credit, together with
notice of the amount of such payment and the date such payment
shall be made. Subject to the terms and provisions of such
Letter of Credit, Issuing Bank shall make such payment (a
"Drawing Payment") to the appropriate beneficiary.
(ii) Time of Reimbursement. Not later than 11:00 a.m.
on the day each Drawing Payment is to be made by Issuing Bank,
Borrower shall make or cause to be made to Issuing Bank a
payment in the amount of such Drawing Payment (a
"Reimbursement Payment"); provided, however, that Borrower
shall make such Reimbursement Payment to, or cause such
Reimbursement Payment to be made to, Administrative Agent for
the benefit of the Banks if, prior to the time such
Reimbursement Payment is made, Issuing Bank has notified
Borrower that it has
29
requested the Banks pursuant to clause (ii) of Subparagraph
2.02(d) to pay to Issuing Bank their respective Proportionate
Shares of the Drawing Payment made by Issuing Bank. If any
such Reimbursement Payment is made to Administrative Agent,
Administrative Agent shall promptly pay to each Bank which has
paid its Proportionate Share of the Drawing Payment, such
Bank's Proportionate Share of the Reimbursement Payment and
shall promptly pay to Issuing Bank the balance of such
Reimbursement Payment.
(iii) Reimbursement Obligation Absolute. The
obligation of Borrower to reimburse Issuing Bank or the Banks,
as the case may be, for Drawing Payments (such obligation to
be referred to herein collectively as a "Reimbursement
Obligation") shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms
of this Agreement under and without regard to any
circumstances, including, without limitation (A) any lack of
validity or enforceability of any of the Credit Documents, (B)
the existence of any claim, setoff, defense or other right
which Borrower may have at any time against any beneficiary or
any transferee of any Letter of Credit (or any Persons for
whom any such beneficiary or transferee may be acting),
Issuing Bank, any Agent, any Bank Party or any other Person,
whether in connection with this Agreement, the transactions
contemplated herein or in the other Credit Documents, or in
any unrelated transaction, (C) any breach of contract or
dispute between Borrower, any beneficiary or any transferee of
any Letter of Credit (or any Persons for whom any such
beneficiary or transferee may be acting), Issuing Bank, any
Agent, any Bank Party or any other Person, (D) any demand,
statement or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being
untrue or inaccurate in any respect, (E) payment by Issuing
Bank under any Letter of Credit against presentation of a
demand for payment which does not comply with the terms of
such Letter of Credit, (F) any non-application or
misapplication by any beneficiary or any transferee of any
Letter of Credit (or any Persons for whom any such beneficiary
or transferee may be acting) of the proceeds of any drawing
under such Letter of Credit or (G) any delay, extension of
time, renewal, compromise or other indulgence or modification
granted or agreed to by Issuing Bank, any Agent or any Bank
Party, with or without notice to or approval by Borrower, with
respect to Borrower's indebtedness under this Agreement;
provided, that this Subparagraph 2.02(b)
30
shall not abrogate any right which Borrower may have to seek
to enjoin any drawing under any Letter of Credit or to recover
damages from Issuing Bank pursuant to Subparagraph 2.02(e).
(d) Bank Participations; Revolving Loan Funding.
(i) Participation Agreement. Each Bank severally,
unconditionally and irrevocably agrees with Issuing Bank to
participate in the extension of credit arising from the
issuance of each Letter of Credit in an amount equal to such
Bank's Proportionate Share of the stated amount of such Letter
of Credit from time to time, and the issuance of each Letter
of Credit shall be deemed a confirmation by Issuing Bank of
such participation in such amount.
(ii) Participation Funding. Issuing Bank may request
the Banks to fund their participations in Letters of Credit by
paying to Issuing Bank all or any portion of any Drawing
Payment made or to be made by Issuing Bank under any Letter of
Credit. Issuing Bank shall make such a request by delivering
to Administrative Agent (with a copy to Borrower), at any time
after the drawing for which such payment is requested has been
made upon Issuing Bank, a written request for such payment
which specifies the amount of such Drawing Payment and the
date on which such Drawing Payment is to be made or was made;
provided, however, that Issuing Bank shall not request the
Banks to make any payment under this Subparagraph 2.02(d) in
connection with any portion of a Drawing Payment for which
Issuing Bank has been reimbursed from a Reimbursement Payment
by Borrower unless such Reimbursement Payment has been
thereafter recovered by Borrower. Administrative Agent shall
promptly notify each Bank of the contents of each such request
and of such Bank's Proportionate Share of the applicable
portion of such Drawing Payment. Promptly following receipt of
such notice from Administrative Agent, each Bank shall pay to
Administrative Agent, for the benefit of Issuing Bank, such
Bank's Proportionate Share of the applicable portion of such
Drawing Payment.
(iii) Funding Through Revolving Loans. At any time
any Reimbursement Obligations are outstanding, Administrative
Agent may or, upon the written request of Issuing Bank (if
Borrower is not then the subject of a bankruptcy proceeding),
shall (subject to the terms and conditions of this
Subparagraph 2.02(d)), initiate a Borrowing in an amount not
exceeding the aggregate amount of such outstanding
Reimbursement Obligations
31
and use the proceeds of such Revolving Loan to repay all or a
portion of such Reimbursement Obligations. Administrative
Agent shall initiate such a Borrowing by delivering to each
Bank (with a copy to Borrower) a written notice which
specifies the aggregate amount of outstanding Reimbursement
Obligations, the amount of the Borrowing, the date of such
Borrowing and the amount of the Revolving Loan to be made by
such Bank as part of such Borrowing. Each Bank shall make
available to Administrative Agent funds in the amount of its
Proportionate Share of such Revolving Loan as provided in
Subparagraph 2.08(a). After receipt of such funds,
Administrative Agent shall promptly disburse such funds to
Issuing Bank and the Banks, as appropriate, in payment of the
outstanding Reimbursement Obligations.
(iv) Obligations Absolute. Each Bank's obligations to
fund its participations under this Subparagraph 2.02(d) shall
be absolute, unconditional and irrevocable and shall not be
affected by (A) the occurrence or existence of any Default or
Event of Default, (B) any failure to satisfy any condition set
forth in Section III, (C) any event or condition which might
have a Material Adverse Effect, (D) the failure of any other
Bank to make any payment under this Subparagraph 2.02(d), (E)
any right of offset, abatement, withholding or reduction which
such Bank may have against Issuing Bank, any Agent, any other
Bank Party or Borrower, (F) any event, circumstance or
condition set forth in Subparagraph 2.02(c) or Subparagraph
2.02(e), or (G) any other event, circumstance or condition
whatsoever, whether or not similar to any of the foregoing;
provided, that nothing in this Paragraph 2.02 shall prejudice
any right which any Bank may have against Issuing Bank for any
action by Issuing Bank which constitutes gross negligence or
willful misconduct.
(e) Liability of Issuing Bank, Etc. Borrower agrees that none
of Issuing Bank, any Agent or any other Bank Party (nor any of their
respective directors, officers or employees) shall be liable or
responsible for (i) the use which may be made of any Letter of Credit
or for any acts or omissions of any beneficiary or transferee thereof
in connection therewith; (ii) any reference which may be made to this
Agreement or to any Letter of Credit in any agreements, instruments or
other documents relating to obligations secured by such Letter of
Credit; (iii) the validity, sufficiency or genuineness of documents, or
of any endorsement(s) thereon, even if such documents should in fact
prove to be in any or all respects invalid, insufficient, fraudulent or
forged or any statement therein
32
prove to be untrue or inaccurate in any respect whatsoever; (iv)
payment by Issuing Bank against presentation of documents which do not
comply with the terms of any Letter of Credit, including failure of any
documents to bear any reference or adequate reference to any Letter of
Credit; or (v) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except only that Issuing
Bank shall be liable to Borrower for acts or events described in
clauses (i) through (v) above, to the extent, but only to the extent,
of any damages suffered by Borrower (excluding consequential damages)
which Borrower proves were caused by (A) Issuing Bank's willful
misconduct, bad faith or gross negligence in determining whether a
drawing made under any Letter of Credit complies with the terms and
conditions therefor stated in such Letter of Credit or (B) Issuing
Bank's willful misconduct, bad faith or gross negligence in failing to
pay under any Letter of Credit after a drawing by the beneficiary
thereof strictly complying with the terms and conditions of such Letter
of Credit. Without limiting the foregoing, Issuing Bank may accept a
drawing that appears on its face to be in order, without responsibility
for further investigation. The determination of whether a drawing has
been made under any Letter of Credit prior to its expiration or whether
a drawing made under any Letter of Credit is in proper and sufficient
form shall be made by Issuing Bank in its sole discretion, which
determination shall be conclusive and binding upon Borrower to the
extent permitted by law. Borrower hereby waives any right to object to
any payment made under any Letter of Credit with regard to a drawing
that is in the form provided in such Letter of Credit but which varies
with respect to punctuation, capitalization, spelling or similar
matters of form.
(f) Reports of Issuing Bank. While any Letter of Credit is
outstanding, Issuing Bank shall on a monthly basis provide to
Administrative Agent or any Bank such information regarding the Letters
of Credit as Administrative Agent or such Bank may reasonably request,
including the Letters of Credit outstanding, the stated amounts of
outstanding Letters of Credit, the expiration dates of outstanding
Letters of Credit, the names of the beneficiaries of outstanding
Letters of Credit, the amounts of unpaid Reimbursement Obligations and
the amounts and times of Drawing Payments and Reimbursement Payments.
(g) Purpose. Borrower shall use the Letters of Credit solely
as provided in clause (ii) of Subparagraph 2.02(a).
2.03. Amount Limitations, Commitment Reductions, Etc.
33
(a) Total Commitments. The sum of the aggregate principal
amount of all Revolving Loans outstanding, the aggregate amount
available for drawing under all Letters of Credit then outstanding and
the aggregate amount of all Reimbursement Obligations then outstanding
(such sum to be referred to herein as the "Outstanding Facilities
Credit") shall not exceed the Total Commitment at such time.
(b) Optional Reduction or Cancellation of Commitments.
Borrower may, upon three (3) Business Days written notice to
Administrative Agent (and, in the case of the LC Commitment, to Issuing
Bank), permanently reduce the Total Commitment by the amount of
$5,000,000 or integral multiples of $1,000,000 in excess thereof or
cancel the Total Commitment in its entirety; provided, however, that:
(i) Borrower may not reduce the Total Commitment if,
after giving effect to such reduction, the Outstanding
Facilities Credit would exceed the Total Commitment as so
reduced; and
(ii) Borrower may not cancel the Total Commitment if,
after giving effect to such cancellation, any Revolving Loan
or Letter of Credit would remain outstanding.
(c) Effect of Commitment Reductions. From the effective date
of any reduction of the Total Commitment, the Commitment Fees payable
pursuant to Subparagraph 2.04(c) shall be computed on the basis of the
Total Commitment as so reduced. Any reduction of the Total Commitment
pursuant to this Paragraph 2.03 shall be applied ratably to reduce each
Bank's Commitment in accordance with clause (i) of Subparagraph
2.09(a).
2.04. Fees.
(a) Agents' Fees. Borrower shall pay to Agents, for their own
accounts, the fees in the amounts and at the times set forth in the
Agents' Fee Letters.
(b) Origination Fees. Borrower shall pay to Administrative
Agent, for the ratable benefit of the Banks as provided in this
Subparagraph 2.04(b), nonrefundable origination fees (the "Origination
Fees") in amounts equal to:
(i) For each Bank which committed to provide
Commitments hereunder of Fifteen Million Dollars ($15,000,000)
or more but less than Twenty-Five Million Dollars
($25,000,000), seven point five one
34
hundredths of one percent (.075%) of the sum of such Bank's
Commitment on the Closing Date;
(ii) For each Bank which committed to provide
Commitments hereunder of Twenty-Five Million Dollars
($25,000,000) or more but less than Forty Million Dollars
($40,000,000), twelve point five one hundredths of one percent
(.125%) of the sum of such Bank's Commitment on the Closing
Date; and
(iii) For each Bank which committed to provide
Commitments hereunder of Forty Million Dollars ($40,000,000)
or more, fifteen one hundredths of one percent (.150%) of the
sum of such Bank's Commitment on the Closing Date.
(c) Commitment Fees. Borrower shall pay to Administrative
Agent, for the ratable benefit of the Banks as provided in clause (v)
of Subparagraph 2.09(a), nonrefundable commitment fees (the "Commitment
Fees") equal to the Commitment Fee Percentage on the daily average
Unused Commitment for the period beginning on the date of this
Agreement and ending on the Maturity Date. The Commitment Fee
Percentage shall be determined as provided in the Pricing Grid and may
change for each Pricing Period. Borrower shall pay the Commitment Fees
quarterly in arrears on the last day in each calendar quarter
(commencing June 30, 1997) and on the Maturity Date (or if the Total
Commitment is cancelled on a date prior to the Maturity Date, on such
prior date).
(d) Letter of Credit Fees.
(i) Letter of Credit Usage Fees. Borrower shall pay
to Administrative Agent, for the ratable benefit of the Banks
as provided in clause (v) of Subparagraph 2.09(a),
nonrefundable usage fees for the Letters of Credit (the "LC
Usage Fees") equal to the LC Usage Fee Rate on the daily
average available amount of each Letter of Credit for the
period beginning on the date such Letter of Credit is issued
and ending on the date such Letter of Credit expires. The LC
Usage Fee Rate shall be determined as provided in the Pricing
Grid and may change for each calendar quarter. Borrower shall
pay the LC Usage Fees quarterly in arrears on the last day in
each calendar quarter (commencing at the end of the first
calendar quarter after the issuance of the initial Letter of
Credit) and on the Maturity Date.
(ii) Letter of Credit Issuance Fees. Borrower shall
either pay to Administrative Agent, for the sole benefit of
Issuing Bank, or directly to Issuing Bank,
35
nonrefundable issuance fees for the Letters of Credit (the "LC
Issuance Fees") as agreed to between Borrower and Issuing Bank
(and, if paid to Administrative Agent, in such amount as
Administrative Agent has been notified by Issuing Bank is then
due).
(iii) Other Letter of Credit Fees. In addition to the
LC Issuance Fees, Borrower shall either pay to Administrative
Agent, for the sole benefit of Issuing Bank, or directly to
Issuing Bank, other standard reasonable fees of Issuing Bank
for drawings under, transfers of and amendments to any Letter
of Credit and other administrative actions performed by
Issuing Bank in connection with any Letter of Credit, payable
at such times and in such amounts as are consistent with
Issuing Bank's standard fee policy at the time of such
amendment or other action (and, if paid to Administrative
Agent, in such amount as Administrative Agent has been
notified by Issuing Bank is then due).
2.05. Prepayments.
(a) Terms of all Prepayments. Upon the prepayment of any
Revolving Loan (whether such prepayment is an optional prepayment under
Subparagraph 2.05(b), a mandatory prepayment required by Subparagraph
2.05(c) or a mandatory prepayment required by any other provision of
this Agreement or the other Credit Documents, including, without
limitation, a prepayment upon acceleration), Borrower shall pay to the
Administrative Agent for the benefit of the Bank Party which made such
Revolving Loan (i) if such prepayment is the prepayment of a LIBOR
Loan, all accrued interest to the date of such prepayment on the amount
prepaid and (ii) if such prepayment is the prepayment of a LIBOR Loan
on a day other than the last day of an Interest Period for such
Revolving Loan, all amounts payable to such Bank Party pursuant to
Paragraph 2.12.
(b) Optional Prepayments. At its option, Borrower may, upon
three (3) Business Days notice to Administrative Agent for LIBOR Loans
and one (1) Business Day notice to Administrative Agent for Base Rate
Loans, prepay any Borrowing in part, in an aggregate principal amount
of $500,000 or more, or in whole.
(c) Mandatory Prepayments. If, at any time, the Outstanding
Facilities Credit exceeds the Total Commitment at such time, Borrower
shall immediately prepay Revolving Loans in an aggregate principal
amount equal to such excess.
(d) Application of Revolving Loan Prepayments. All prepayments
of the Revolving Loans shall, to the extent
36
possible, be first applied to prepay Base Rate Loans and then, if any
funds remain, to prepay LIBOR Loans.
2.06. Other Payment Terms.
(a) Place and Manner. Except as otherwise expressly provided
herein, Borrower shall make all payments due to each Bank Party
hereunder by payments to Administrative Agent, for the account of such
Bank Party and such Bank Party's Applicable Lending Office, at
Administrative Agent's office, located at the address specified in
Paragraph 8.01, in lawful money of the United States and in same day or
immediately available funds not later than 11:00 A.M. on the date due.
Administrative Agent shall promptly disburse to each Bank Party each
such payment received by Administrative Agent for such Bank Party.
(b) Date. Whenever any payment due hereunder shall fall due on
a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall be included
in the computation of interest or fees, as the case may be.
(c) Late Payments. If any amounts required to be paid by
Borrower under this Agreement or the other Credit Documents (including,
without limitation, principal or interest payable on any Revolving Loan
or interest thereon, any fees or other amounts) remain unpaid after
such amounts are due, Borrower shall pay interest on the aggregate,
outstanding balance of such amounts from the date due until those
amounts are paid in full at a per annum rate equal to the Base Rate
plus two percent (2.00%), such rate to change from time to time as the
Base Rate shall change.
(d) Application of Payments. All payments hereunder shall be
applied first to unpaid fees, costs and expenses then past due under
this Agreement or the other Credit Documents, second to accrued
interest then due and payable under this Agreement or the other Credit
Documents and finally to reduce the principal amount of outstanding
Revolving Loans.
(e) Failure to Pay Administrative Agent. Unless Administrative
Agent shall have received notice from Borrower prior to the date on
which any payment is due to any Bank Parties hereunder that Borrower
will not make such payment in full, Administrative Agent may assume
that Borrower has made such payment in full to Administrative Agent on
such date and Administrative Agent may, in reliance upon such
assumption, cause to be distributed to the appropriate Bank Parties on
such due date an amount equal to the amount then due such Bank Parties.
If and to the extent
37
Borrower shall not have so made such payment in full to Administrative
Agent, each such Bank Party shall repay to Administrative Agent
forthwith on demand such amount distributed to such Bank Party together
with interest thereon, for each day from the date such amount is
distributed to such Bank Party until the date such Bank Party repays
such amount to Administrative Agent, at (i) the Federal Funds Rate for
the first three (3) days and (ii) the Base Rate thereafter. A
certificate of Administrative Agent submitted to any Bank Party with
respect to any amounts owing by such Bank Party under this Subparagraph
2.06(e) shall be conclusive absent manifest error.
2.07. Notes and Interest Account.
(a) Notes. The obligation of Borrower to repay the Revolving
Loans made by each Bank and to pay interest thereon at the rates
provided herein shall be evidenced by a promissory note in the form of
Exhibit D (individually, a "Note") which note shall be (i) payable to
the order of such Bank, (ii) in the amount of such Bank's Commitment,
(iii) dated the Closing Date and (iv) otherwise appropriately
completed. Borrower authorizes each Bank to record on the schedule
annexed to such Bank's Note the date and amount of each Revolving Loan
made by such Bank and of each payment or prepayment of principal
thereon made by Borrower, and agrees that all such notations shall
constitute prima facie evidence of the matters noted. Borrower further
authorizes each Bank to attach to and make a part of such Bank's Note
continuations of the schedule attached thereto as necessary.
(b) Interest Account. Borrower authorizes Administrative Agent
to record in an account or accounts maintained by Administrative Agent
on its books (the "Interest Account") (i) the interest rates applicable
to all Revolving Loans and the effective dates of all changes thereto,
(ii) the Interest Period for each LIBOR Loan, (iii) the date and amount
of each principal and interest payment on each Revolving Loan and (iv)
such other information as Administrative Agent may determine is
necessary for the computation of interest payable by Borrower
hereunder.
2.08. Revolving Loan Funding, Etc.
(a) Bank Funding and Disbursement to Borrower. Each Bank
shall, before 12:00 P.M. on the date of each Borrowing, make available
to Administrative Agent at its office specified in Paragraph 8.01, in
same day or immediately available funds, such Bank's pro rata share of
such Borrowing. After Administrative Agent's receipt of such
38
funds and upon fulfillment of the applicable conditions set forth in
Section III, Administrative Agent will promptly disburse such funds in
same day or immediately available funds to Borrower. Unless otherwise
directed by Borrower, Administrative Agent shall disburse the proceeds
of each Borrowing to Borrower by disbursement to the account or
accounts specified in the applicable Notice of Borrowing.
(b) Bank Failure to Fund. Unless Administrative Agent shall
have received notice from a Bank prior to the date of any Borrowing
that such Bank will not make available to Administrative Agent such
Bank's pro rata share of such Borrowing, Administrative Agent may
assume that such Bank has made such portion available to Administrative
Agent on the date of such Borrowing in accordance with Subparagraph
2.08(a), and Administrative Agent may, in reliance upon such
assumption, make available to Borrower (or otherwise disburse) on such
date a corresponding amount. If any Bank does not make the amount of
its pro rata share of any Borrowing available to Administrative Agent
on or prior to the date of such Borrowing, such Bank shall pay to
Administrative Agent, on demand, interest which shall accrue on such
amount until made available to Administrative Agent at rates equal to
(i) the daily Federal Funds Rate during the period from the date of
such Borrowing through the third Business Day thereafter and (ii) the
Base Rate thereafter. A certificate of Administrative Agent submitted
to any Bank with respect to any amounts owing under this Subparagraph
2.08(b) shall be conclusive absent manifest error. If any Bank's pro
rata share of any Borrowing is not in fact made available to
Administrative Agent by such Bank within three (3) Business Days after
the date of such Borrowing, Borrower shall pay to Administrative Agent,
on demand, an amount equal to such pro rata share together with
interest thereon, for each day from the date such amount was made
available to Borrower until the date such amount is repaid to
Administrative Agent, at the interest rate applicable at the time to
the Revolving Loans comprising such Borrowing.
(c) Banks' Obligations Several. The failure of any Bank to
make the Revolving Loan to be made by it as part of any Borrowing shall
not relieve any other Bank of its obligation hereunder to make its
Revolving Loan on the date of such Borrowing, but no Bank shall be
responsible for the failure of any other Bank to make the Revolving
Loan to be made by such other Bank on the date of any Borrowing.
2.09. Pro Rata Treatment.
(a) Borrowings, Commitment Reductions, Etc. Except as
otherwise provided herein:
39
(i) Each Borrowing, each reduction of the Total
Commitment and participations in each Letter of Credit shall
be made by or shared among the Banks pro rata according to
their respective Proportionate Shares;
(ii) Each payment of principal of Revolving Loans in
any Borrowing shall be shared among the Banks which made or
funded the Revolving Loans in such Borrowing pro rata
according to the respective unpaid principal amounts of such
Revolving Loans so made or funded by such Banks;
(iii) Each payment of interest on Revolving Loans in
any Borrowing shall be shared among the Banks which made or
funded the Revolving Loans in such Borrowing pro rata
according to (A) the respective unpaid principal amounts of
such Revolving Loans so made or funded by such Banks and (B)
the dates on which such Banks so made or funded such Revolving
Loans or is deemed to have made or funded such Revolving Loans
to the extent such Bank otherwise paid interest to
Administrative Agent on such Revolving Loans in accordance
with Subparagraph 2.08(b);
(iv) Each Reimbursement Payment and interest payable
by Borrower thereon shall be shared among the Banks (including
Issuing Bank) which made or funded the applicable Drawing
Payment pro rata according to the respective amounts of such
Drawing Payment so made or funded by such Banks;
(v) Each payment of Commitment Fees shall be shared
among the Banks pro rata according to (A) their respective
Proportionate Share and (B) in the case of each Bank which
becomes a Bank hereunder after the date hereof, the date upon
which such Bank so became a Bank;
(vi) Each payment of LC Usage Fees shall be shared
among the Banks (including Issuing Bank in its capacity as a
Bank) pro rata according to (A) their respective Proportionate
Share and (B) in the case of each Bank which becomes a Bank
hereunder after the date hereof, the date upon which such Bank
so became a Bank;
(vii) Each payment of interest (other than interest
on Revolving Loans) shall be shared among the Bank Parties and
Agents owed the amount upon which such interest accrues pro
rata according to (A) the respective amounts so owed such Bank
Parties and (B) the dates on which such amounts became owing
to such Bank Parties; and
40
(viii) All other payments under this Agreement and
the other Credit Documents shall be for the benefit of the
Person or Persons specified.
(b) Sharing of Payments, Etc. If any Bank Party shall obtain
any payment (whether voluntary, involuntary, through the exercise of
any right of setoff, or otherwise) on account of Revolving Loans owed
to it in excess of its ratable share of payments on account of such
Revolving Loans obtained by all Banks entitled to such payments, such
Bank Party shall forthwith purchase from the other Bank Parties
entitled to such payments such participations in the Revolving Loans or
Reimbursement Obligations as shall be necessary to cause such
purchasing Bank Party to share the excess payment ratably with each of
them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Bank Party, such
purchase shall be rescinded and each other Bank Party shall repay to
the purchasing Bank Party the purchase price to the extent of such
recovery together with an amount equal to such other Bank Party's
ratable share (according to the proportion of (i) the amount of such
other Bank Party's required repayment to (ii) the total amount so
recovered from the purchasing Bank) of any interest or other amount
paid or payable by the purchasing Bank Party in respect of the total
amount so recovered. Borrower agrees that any Bank Party so purchasing
a participation from another Bank Party pursuant to this Subparagraph
2.09(b) may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of setoff, but only as provided
in Paragraph 8.06) with respect to such participation as fully as if
such Bank Party were the direct creditor of Borrower in the amount of
such participation.
2.10. Change of Circumstances.
(a) Inability to Determine Rates. If, on or before the first
day of any Interest Period for any LIBOR Loan, Agents shall determine
that (i) the LIBO Rate for such Interest Period cannot be adequately
and reasonably determined due to the unavailability of funds in or
other circumstances affecting the London interbank market or (ii) the
rates of interest for such LIBOR Loans do not adequately and fairly
reflect the cost to the Banks of making or maintaining such LIBOR
Loans, Administrative Agent shall immediately give notice of such
condition to Borrower and the Banks. After the giving of any such
notice and until Administrative Agent shall otherwise notify Borrower
that the circumstances giving rise to such condition no longer exist,
Borrower's right to request the making of or conversion to, and the
Banks' obligations to make or convert to LIBOR Loans shall be
suspended. Any LIBOR Loans
41
outstanding at the commencement of any such suspension shall, unless
fully repaid, be converted at the end of the then current Interest
Period for such LIBOR Loans into Base Rate Loans unless such suspension
has then ended.
(b) Illegality. If, after the date of this Agreement, the
adoption of any Governmental Rule, any change in any Governmental Rule
or the application or requirements thereof (whether such change occurs
in accordance with the terms of such Governmental Rule as enacted, as a
result of amendment or otherwise), any change in the interpretation or
administration of any Governmental Rule by any Governmental Authority,
or compliance by any Bank with any request or directive (whether or not
having the force of law) of any Governmental Authority (a "Change of
Law") shall make it unlawful or impossible for any Bank to make or
maintain any LIBOR Loan, such Bank shall immediately notify
Administrative Agent and Borrower of such Change of Law. Upon receipt
of such notice, (i) Borrower's right to request the making of or
conversion to, and such Bank's obligation to make or convert to, LIBOR
Loans shall be terminated, and (ii) Borrower shall, at the request of
such Bank, either (A) pursuant to Subparagraph 2.01(d), convert any
such then outstanding LIBOR Loans of such Bank into Base Rate Loans at
the end of the current Interest Period for such LIBOR Loans, or (B)
immediately repay or convert any such LIBOR Loans if such Bank shall
notify Borrower that such Bank may not lawfully continue to fund and
maintain such LIBOR Loans. Any conversion or prepayment of LIBOR Loans
made pursuant to the preceding sentence prior to the last day of an
Interest Period for such LIBOR Loans shall be deemed a prepayment
thereof for purposes of Paragraph 2.12. After any Bank notifies
Administrative Agent and Borrower of such a Change of Law and until
such Bank notifies Administrative Agent and Borrower that it is no
longer unlawful or impossible for such Bank to make or maintain any
LIBOR Loan, all Revolving Loans of such Bank shall be Base Rate Loans.
(c) Increased Costs. If, after the date of this Agreement, any
Change of Law:
(i) Shall subject any Bank to any tax, duty or other
charge with respect to any LIBOR Loan, or shall change the
basis of taxation of payments by Borrower to any Bank on such
a LIBOR Loan or in respect to such a LIBOR Loan under this
Agreement (except for changes in the rate of taxation on the
overall net income of any Bank imposed by its jurisdiction of
incorporation or the jurisdiction in which such Bank maintains
a lending office); or
42
(ii) Shall impose, modify or hold applicable any
reserve (excluding any Reserve Requirement or other reserve to
the extent included in the calculation of the LIBO Rate for
any LIBOR Loans), special deposit or similar requirement
against assets held by, deposits or other liabilities in or
for the account of, advances or loans by, or any other
acquisition of funds by any Bank for any LIBOR Loan; or
(iii) Shall impose on any Bank any other condition
related to any LIBOR Loan or such Bank's Commitments;
and the effect of any of the foregoing is to increase the cost to such
Bank of making, renewing, or maintaining any such LIBOR Loan or such
Bank's Commitments or to reduce any amount receivable by such Bank
hereunder, then Borrower shall from time to time, within five (5) days
after demand by such Bank (which demand shall be accompanied by a
statement setting forth in reasonable detail the basis for the
calculation of the amount demanded), pay to such Bank additional
amounts sufficient to reimburse such Bank for such increased costs or
to compensate such Bank for such reduced amounts; provided, however,
that Borrower shall not be obligated to pay any Bank for any such
increased costs or reduced amounts incurred more than sixty (60) days
prior to the date of such Bank's demand for payment if such demand was
made more than sixty (60) days after the latest of (A) the date such
Bank received actual notice of such increased cost or reduced amount,
(B) the effective date of such Change in Law, or (C) the date such
Change in Law occurred or was enacted. A certificate as to the amount
of such increased costs or reduced amounts submitted by such Bank to
Borrower shall constitute prima facie evidence of such increased costs
or reduced amounts. The obligations of Borrower under this Subparagraph
2.10(c) shall survive the payment and performance of the Obligations
and the termination of this Agreement.
(d) Capital Requirements. If, after the date of this
Agreement, any Bank Party determines that (i) any Change of Law affects
the amount of capital required or expected to be maintained by such
Bank Party or any Person controlling such Bank Party (a "Capital
Adequacy Requirement") and (ii) the amount of capital maintained by
such Bank Party or such Person which is reasonably attributable to or
based upon the Revolving Loans, the Letters of Credit, the Commitments
or this Agreement must be increased as a result of such Capital
Adequacy Requirement (taking into account such Bank Party's or such
Person's policies with respect to capital adequacy), Borrower shall pay
to such Bank Party or such Person, within five (5) days after demand of
such Bank Party (which demand shall be accompanied by a statement
setting forth in
43
reasonable detail the basis for the calculation of the amount
demanded), such amounts as such Bank Party or such Person shall
reasonably determine are necessary to compensate such Bank Party or
such Person for the increased costs to such Bank Party or such Person
of such increased capital. A certificate of any Bank Party setting
forth in reasonable detail the computation of any such increased costs
delivered by such Bank Party to Borrower shall constitute prima facie
evidence of such increased costs. The obligations of Borrower under
this Subparagraph 2.10(d) shall survive the payment and performance of
the Obligations and the termination of this Agreement.
(e) Mitigation. As promptly as practical after any Bank
becomes aware of (i) any Change of Law which will make it unlawful or
impossible for such Bank to make or maintain any LIBOR Loan or (ii) any
obligation by Borrower to pay any amount pursuant to Subparagraph
2.10(c) or Subparagraph 2.10(d), such Bank shall notify Borrower and
Administrative Agent (and, if any Bank has given notice of any such
event described in clause (i) or (ii) above and thereafter such event
ceases to exist, such Bank shall promptly so notify Borrower and
Administrative Agent). Each Bank affected by any Change of Law which
makes it unlawful or impossible for such Bank to make or maintain any
LIBOR Loan or to which Borrower is obligated to pay any amount pursuant
to Subparagraph 2.10(c) or Subparagraph 2.10(d) shall use reasonable
commercial efforts (including changing the jurisdiction of its
Applicable Lending Office) to avoid the effect of such Change of Law or
to avoid or materially reduce any amounts which Borrower is obligated
to pay pursuant to Subparagraph 2.10(c) or Subparagraph 2.10(d) if, in
the reasonable opinion of such Bank, such efforts would not be
disadvantageous to such Bank or contrary to such Bank's normal banking
practices.
2.11. Taxes on Payments.
(a) Payments Free of Taxes. All payments made by Borrower
under this Agreement and the other Credit Documents shall be made free
and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority (except (i) net income taxes and franchise taxes
in lieu of net income taxes imposed on any Agent or Bank Party by its
jurisdiction of incorporation or any jurisdiction in which it maintains
a lending office and (ii) withholding taxes required to be paid for
Bank Parties who do not comply with Subparagraph 2.11(b) at the time
they first become Bank Parties hereunder) (all such non-excluded
44
taxes, levies, imposts, duties, charges, fees, deductions and
withholdings being hereinafter called "Taxes"). Subject to Subparagraph
2.11(c), if any Taxes are required to be withheld from any amounts
payable to any Agent or any Bank Party hereunder or under the other
Credit Documents, the amounts so payable to such Agent or such Bank
Party shall be increased to the extent necessary to yield to such Agent
or such Bank Party (after payment of all Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts
specified in this Agreement and the other Credit Documents. Whenever
any Taxes are payable by Borrower, as promptly as possible thereafter,
Borrower shall send to Administrative Agent for its own account or for
the account of such other Agent or such Bank Party, as the case may be,
a certified copy of an original official receipt received by Borrower
showing payment thereof. If Borrower fails to pay any Taxes when due to
the appropriate taxing authority or fails to remit to Administrative
Agent the required receipts or other required documentary evidence,
Borrower shall indemnify Agents and the Bank Parties for any
incremental taxes, interest or penalties that may become payable by any
Agent or any Bank Party as a result of any such failure. The
obligations of Borrower under this Subparagraph 2.11(a) shall survive
the payment and performance of the Obligations and the termination of
this Agreement.
(b) Withholding Exemption Certificates. On or prior to the
Closing Date, each Bank which is not incorporated under the laws of the
United States of America or a state thereof shall deliver to Borrower
and Administrative Agent either two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224 (or successor
applicable form), as the case may be, certifying in each case that such
Bank is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal taxes. Each Bank
which delivers to Borrower and Administrative Agent a Form 1001 or 4224
pursuant to the immediately preceding sentence further undertakes to
deliver to Borrower and Administrative Agent two further copies of Form
1001 or 4224, or successor applicable forms, or other manner of
certification or procedure, as the case may be, on or before the date
that any such letter or form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent letter
and form previously delivered by it to Borrower and Administrative
Agent, and such extensions or renewals thereof as may reasonably be
requested by Borrower or Administrative Agent, certifying in the case
of a Form 1001 or 4224 that such Bank is entitled to receive payments
under this Agreement without deduction or withholding of any United
States federal taxes, unless in any such cases an event (including
without limitation any change in treaty, law or regulation) has
45
occurred prior to the date on which any such delivery would otherwise
be required which renders all such forms inapplicable or which would
prevent a Bank from duly completing and delivering any such letter or
form with respect to it and such Bank advises Borrower and
Administrative Agent that it is not capable of receiving payments
without any deduction or withholding of United States federal income
tax.
(c) Mitigation. Any Agent or Bank Party claiming any
additional amounts payable pursuant to this Paragraph 2.11 shall use
reasonable commercial efforts to file any certificate or document
requested in writing by Borrower (including without limitation copies
of Internal Revenue Service Form 1001, or successor forms, reflecting a
reduced rate of withholding) or to change the jurisdiction of its
Applicable Lending Office if the making of such a filing or such change
in the jurisdiction of its Applicable Lending Office would avoid the
need for or materially reduce the amount of any such additional amounts
which may thereafter accrue and if, in the reasonable opinion of such
Agent or Bank Party in the case of a change in the jurisdiction of its
Applicable Lending Office, such change would not be disadvantageous to
such Agent or Bank Party or contrary to such Agent's or Bank Party's
normal banking practices.
(d) Tax Returns. Nothing contained in this Paragraph 2.11
shall require any Agent or Bank Party to make available any of its tax
returns (or any other information relating to its taxes which it deems
to be confidential).
2.12. Funding Loss Indemnification. If Borrower shall (a) repay, prepay
or convert any LIBOR Loan on any day other than the last day of an Interest
Period therefor (whether a scheduled payment, an optional prepayment or
conversion, a mandatory prepayment or conversion, a payment upon acceleration or
otherwise), (b) fail to borrow any LIBOR Loan for which a Notice of Borrowing
has been delivered to Administrative Agent (whether as a result of the failure
to satisfy any applicable conditions or otherwise) or (c) fail to convert any
Revolving Loans into LIBOR Loans in accordance with a Notice of Conversion
delivered to Administrative Agent (whether as a result of the failure to satisfy
any applicable conditions or otherwise), Borrower shall, upon demand by any
Bank, reimburse such Bank for and hold such Bank harmless from all Funding
Losses and all related incidental costs and expenses (such as administrative
costs and expenses) incurred by such Bank as a result of such repayment,
prepayment or failure. Each Bank demanding payment under this Paragraph 2.12
shall deliver to Borrower, with a copy to Administrative Agent, a certificate
setting forth the amount of Funding Losses and related incidental costs and
expenses for which demand is made, which certificate shall set forth in
46
reasonable detail the calculation of the amount demanded. Such a certificate so
delivered to Borrower shall constitute prima facie evidence of such Funding
Losses and related incidental costs and expenses. The obligations of Borrower
under this Paragraph 2.12 shall survive the payment and performance of the
Obligations and the termination of this Agreement for a period of one year from
the date of termination.
2.13. Replacement of Banks. If any Bank shall (a) become a Defaulting
Bank more than two (2) times in a period of twelve (12) consecutive months, (b)
continue as a Defaulting Bank for more than five (5) Business Days at any time,
(c) suspend its obligation to make or maintain LIBOR Loans pursuant to
Subparagraph 2.10(b) for a reason which is not applicable to the Banks (or a
material number of the Banks) generally, or (d) demand any payment under
Subparagraph 2.10(c), 2.10(d) or 2.11(a) for a reason which is not applicable to
the Banks (or a material number of Banks) generally, then Administrative Agent
may (or upon the written request of Borrower or Agents, shall) replace such Bank
(the "affected Bank"), or cause such affected Bank to be replaced, with another
bank (the "replacement bank") satisfying the requirements of an Assignee Bank
under Subparagraph 8.05(c), by having the affected Bank sell and assign all of
its rights and obligations under this Agreement and the other Credit Documents
to the replacement bank pursuant to Subparagraph 8.05(c); provided, however,
that if Borrower seeks to exercise such right, it must do so within one hundred
twenty (120) days after it first knows or should have known of the occurrence of
the event or events giving rise to such right, and neither Administrative Agent
nor any Agent nor any Bank shall have any obligation to identify or locate a
replacement bank for Borrower. Upon receipt by any affected Bank of a written
notice from Administrative Agent stating that Administrative Agent is exercising
the replacement right set forth in this Paragraph 2.14, such affected Bank shall
sell and assign all of its rights and obligations under this Agreement and the
other Credit Documents to the replacement bank pursuant to an Assignment
Agreement and Subparagraph 8.05(c) for a purchase price equal to the sum of the
principal amount of the affected Bank's Revolving Loans so sold and assigned,
all accrued and unpaid interest thereon and its ratable share of all fees to
which it is entitled.
SECTION III. CONDITIONS PRECEDENT.
3.01. Initial Conditions Precedent. The obligations of the Bank Parties
to make the Revolving Loans comprising the initial Borrowing or of Issuing Bank
to issue the initial Letter of Credit are subject to receipt by Administrative
Agent, on or prior to the Closing Date, of each item listed in Schedule 3.01,
each in form and substance reasonably satisfactory to the Banks,
47
and with sufficient copies for, Administrative Agent and each Bank.
3.02. Conditions Precedent to Each Credit Event. The occurrence of each
Credit Event (including the initial Borrowing and the initial Letter of Credit)
is subject to the further conditions that:
(a) Borrower shall have delivered to Administrative Agent (and
Issuing Bank, in the case of an LC Application) the Notice of Borrowing
for such Credit Event in accordance with this Agreement;
(b) On the date such Credit Event is to occur and after giving
effect to such Credit Event, the following shall be true and correct:
(i) The representations and warranties of Borrower
and its Subsidiaries set forth in Paragraph 4.01 and in the
other Credit Documents are true and correct in all material
respects as if made on such date (except for representations
and warranties expressly made as of a specified date, which
shall be true as of such date); and
(ii) No Default or Event of Default has occurred and
is continuing or will result from such Credit Event; and
(c) On the date such Credit Event is to occur and after giving
effect to such Credit Event, all of the Credit Documents are in full
force and effect.
The submission by Borrower to Administrative Agent of each Notice of Borrowing
and each LC Application shall be deemed to be a representation and warranty by
Borrower as of the date thereon as to the above.
3.03. Conditions Precedent to Each Conversion or Each Selection of
Interest Period. The occurrence of the conversion of any Base Rate Loan into a
LIBOR Loan or the selection of a new Interest Period for any LIBOR Loan is
subject to the further conditions that:
(a) Borrower shall have delivered to Administrative Agent the
Notice of Conversion or Notice of Interest Period Selection, as the
case may be, for such conversion or selection of an Interest Period in
accordance with this Agreement;
(b) On the date such conversion or selection of an Interest
Period is to occur and after giving effect to such
48
conversion or selection of an Interest Period, no Default or Event of
Default has occurred and is continuing or will result from such
conversion or selection of an Interest Period; and
(c) On the date such conversion or selection of an Interest
Period is to occur and after giving effect to such conversion or
selection of an Interest Period, all of the Credit Documents are in
full force and effect.
The submission by Borrower to Administrative Agent of each Notice of Conversion
and each Notice of Interest Period Selection shall be deemed to be a
representation and warranty by Borrower as of the date thereon as to the above.
SECTION IV. REPRESENTATIONS AND WARRANTIES.
4.01. Borrower's Representations and Warranties. In order to induce the
Agents and Bank Parties to enter into this Agreement, Borrower hereby represents
and warranties to the Agents and Bank Parties as follows:
(a) Due Incorporation, Qualification, etc. Each of Borrower
and Borrower's Subsidiaries (i) is a corporation duly organized,
validly existing and in good standing under the laws of its
jurisdiction of incorporation; (ii) has the power and authority to own,
lease and operate its properties and carry on its business as now
conducted; and (iii) is duly qualified, licensed to do business and in
good standing as a foreign corporation in each jurisdiction where the
failure to be so qualified or licensed is reasonably likely to have a
Material Adverse Effect.
(b) Authority. The execution, delivery and performance by
Borrower of each Credit Document executed, or to be executed, by
Borrower and the consummation of the transactions contemplated thereby
(i) are within the corporate power of Borrower and (ii) have been duly
authorized by all necessary corporate actions on the part of Borrower.
(c) Enforceability. Each Loan Document in the nature of an
agreement executed, or to be executed, by Borrower has been, or will
be, duly executed and delivered by Borrower and constitutes, or will
constitute, a legal, valid and binding obligation of Borrower,
enforceable against Borrower in accordance with its terms, except as
limited by bankruptcy, insolvency or other laws of general application
relating to or affecting the enforcement of creditors' rights generally
and general principles of equity
49
(regardless of whether considered in a proceeding in equity or at law).
(d) Non-Contravention. The execution and delivery by Borrower
of the Loan Documents and the performance and consummation of the
transactions contemplated thereby do not (i) violate any Requirement of
Law applicable to Borrower; (ii) violate any provision of, or result in
the breach or the acceleration of, or entitle any other Person to
accelerate (whether after the giving of notice or lapse of time or
both), any Contractual Obligations of Borrower which could reasonably
be expected to have a Material Adverse Effect; or (iii) result in the
creation or imposition of any Lien (or the obligation to create or
impose any Lien) upon any property, asset or revenue of Borrower
(except such Liens as may be created in favor of Administrative Agent
pursuant to this Agreement or the other Credit Documents).
(e) Approvals. No material consent, approval, order or
authorization of, or registration, declaration or filing with, any
Governmental Authority or other Person having jurisdiction over
Borrower or any of Borrower's Subsidiaries (including the shareholders
of any Person) is required in connection with the execution and
delivery of the Loan Documents executed by Borrower or the performance
and consummation of the transactions contemplated thereby except for
consents, approvals, orders, authorizations, registrations,
declarations or filings required to be obtained or made in accordance
with the Loan Documents.
(f) No Violation or Default. Neither Borrower nor any of
Borrower's Subsidiaries is in violation of or in default with respect
to (i) any Requirement of Law applicable to such Person or (ii) any
Contractual Obligation of such Person, where, in each case, such
violation or default is reasonably likely to have a Material Adverse
Effect. Without limiting the generality of the foregoing, neither
Borrower nor any of Borrower's Subsidiaries (A) is in violation of any
Environmental Laws, (B) to the best of Borrower's knowledge, has any
liability or potential liability under any Environmental Laws or (C)
has received written notice or other written communication of an
investigation or is under investigation by any Governmental Authority
having jurisdiction over Borrower or any of Borrower's Subsidiaries
having authority to enforce Environmental Laws, where, in each case,
such violation, liability or investigation could reasonably be expected
to have a Material Adverse Effect, nor, to the best of Borrower's
knowledge, have any Hazardous Materials been released or disposed of on
any of the properties owned by Borrower or Borrower's Subsidiaries
which, either individually or in the aggregate, could reasonably be
50
expected to have a Material Adverse Effect. No Event of Default or
Default has occurred and is continuing.
(g) Litigation. Except as set forth in the Disclosure Letter,
no actions (including, without limitation, derivative actions), suits,
proceedings or investigations are pending or, to the knowledge of
Borrower, threatened against Borrower or any of Borrower's Subsidiaries
at law or in equity in any court or before any other Governmental
Authority having jurisdiction over Borrower or any of Borrower's
Subsidiaries which (i) is reasonably likely (alone or in the aggregate)
to have a Material Adverse Effect or (ii) seeks to enjoin, either
directly or indirectly, the execution, delivery or performance of the
Loan Documents or the transactions contemplated thereby.
(h) Title; Possession Under Leases. Borrower and Borrower's
Subsidiaries (i) own and have good title (without regard to minor
defects of title) to all their other respective properties and assets
which are material to the business of Borrower and its Subsidiaries
taken as a whole, as reflected in the most recent Financial Statements
delivered to Administrative Agent (except those assets and properties
disposed of since the date of such Financial Statements in compliance
with this Agreement) and (ii) own and have good title (without regard
to minor defects of title) to all respective properties and assets
acquired by Borrower and Borrower's Subsidiaries since such date which
are material to the business of Borrower and its Subsidiaries taken as
a whole (except those assets and properties disposed of in compliance
with this Agreement). Such assets and properties are subject to no
Lien, except for Permitted Liens.
(i) Financial Statements. The Financial Statements of Borrower
which have been delivered to Administrative Agent in connection with
this Agreement, (i) are in accordance with the books and records of
Borrower, which have been maintained in accordance with good business
practice; (ii) have been prepared in conformity with GAAP; and (iii)
fairly present in all material respects the financial condition and
results of operations of Borrower as of the date thereof and for the
periods covered thereby.
(j) No Agreements to Sell Assets; Etc. As of the Closing Date,
neither Borrower nor any of Borrower's Material Subsidiaries has any
legal obligation, absolute or contingent, to any Person to sell all or
any material part of the assets of Borrower or any of Borrower's
Material Subsidiaries (other than Transfers permitted pursuant to
Subparagraph 5.02(c)), or to effect any merger, consolidation or other
reorganization of Borrower or any of
51
Borrower's Subsidiaries or to enter into any agreement with respect
thereto.
(k) Employee Benefit Plans.
(i) Based on the latest valuation of each Employee
Benefit Plan that either Borrower or any ERISA Affiliate
maintains or contributes to, or has any obligation under
(which occurred within twelve months of the date of this
representation), the aggregate benefit liabilities of such
plan within the meaning of ss. 4001 of ERISA did not exceed
the aggregate value of the assets of such plan. Neither
Borrower nor any ERISA Affiliate has any liability with
respect to any post-retirement benefit under any Employee
Benefit Plan which is a welfare plan (as defined in section
3(1) of ERISA), other than liability for health plan
continuation coverage described in Part 6 of Title I(B) of
ERISA, which liability for health plan contribution coverage
is not reasonably likely to have a Material Adverse Effect.
(ii) Each Employee Benefit Plan complies, in both
form and operation, in all material respects, with its terms,
ERISA and the Code, and no condition exists or event has
occurred with respect to any such plan which would result in
the incurrence by either Borrower or any ERISA Affiliate of
any material liability, fine or penalty. Each Employee Benefit
Plan, related trust agreement, arrangement and commitment of
Borrower or any ERISA Affiliate is legally valid and binding
and in full force and effect. No Employee Benefit Plan is
being audited or investigated by any government agency or is
subject to any pending or threatened claim or suit. Neither
Borrower nor any ERISA Affiliate has nor, to the knowledge of
Borrower or any ERISA Affiliate, has any fiduciary of any
Employee Benefit Plan engaged in a prohibited transaction
under section 406 of ERISA or section 4975 of the Code.
(iii) Neither Borrower nor any ERISA Affiliate has
any material contingent obligations to any Multiemployer Plan.
Neither Borrower nor any ERISA Affiliate has incurred any
material liability (including secondary liability) to any
Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under Section 4201 of
ERISA or as a result of a sale of assets described in Section
4204 of ERISA. Neither Borrower nor any ERISA Affiliate has
been notified that any Multiemployer Plan is in reorganization
or insolvent under and within the meaning of Section 4241 or
Section 4245 of ERISA or
52
that any Multiemployer Plan intends to terminate or has been
terminated under Section 4041A of ERISA.
(l) Other Regulations. Neither Borrower nor any of its
Subsidiaries is subject to regulation under the Investment Company Act
of 1940, the Public Utility Holding Company Act of 1935, the Federal
Power Act, any state public utilities code or to any other Governmental
Rule limiting its ability to incur indebtedness.
(m) Patent and Other Rights. Borrower and Borrower's
Subsidiaries own or license under validly existing agreements (or could
obtain such ownership, possession or license on terms not materially
adverse to Borrower and its Subsidiaries, taken as a whole, and under
circumstances that could not reasonably be expected to have a Material
Adverse Effect), and have the full right to license without the consent
of any other Person, all patents, licenses, trademarks, trade names,
trade secrets, service marks, copyrights and all rights with respect
thereto, which are material to conduct the businesses of Borrower and
its Subsidiaries (taken as a whole) as now conducted.
(n) Governmental Charges. Borrower and Borrower's Subsidiaries
have filed or caused to be filed all material tax returns which are
required by law to be filed by them. Borrower and Borrower's
Subsidiaries have paid, or made provision for the payment of, all taxes
and other Governmental Charges which have become due pursuant to said
returns or otherwise, except such Governmental Charges, if any, which
are being contested in good faith and as to which adequate reserves
(determined in accordance with GAAP) have been provided or which are
not reasonably likely to have a Material Adverse Effect if unpaid.
(o) Margin Stock. Borrower owns no Margin Stock which, in the
aggregate, would constitute a substantial part of the assets of
Borrower, and no proceeds of any Revolving Loan and no Letter of Credit
will be used to purchase or carry, directly or indirectly, any Margin
Stock or to extend credit, directly or indirectly, to any Person for
the purpose of purchasing or carrying any Margin Stock.
(p) Subsidiaries, etc. Set forth in Schedule 4.01(p) (as
supplemented by Borrower on or immediately prior to each anniversary of
the Closing Date in a written notice to Administrative Agent) is a
complete list of all of Borrower's Subsidiaries, the jurisdiction of
incorporation of each, the asset value of each and the percentage of
Borrower's consolidated total assets represented by each. Except for
such Subsidiaries, Borrower has no Subsidiaries, is not a partner in
any partnership or a joint venturer in
53
any joint venture except the joint venture with MKE in MKE-Quantum.
(q) Solvency, Etc. Borrower and each of its Material
Subsidiaries is Solvent and, after the execution and delivery of the
Loan Documents and the consummation of the transactions contemplated
thereby, will be Solvent.
(r) Catastrophic Events. Neither Borrower nor any of
Borrower's Subsidiaries and none of their properties is affected by any
fire, explosion, strike, lockout or other labor dispute, earthquake,
embargo or other casualty that is reasonably likely to have a Material
Adverse Effect. As of the Closing Date, there are no disputes presently
subject to grievance procedure, arbitration or litigation under any of
the collective bargaining agreements, employment contracts or employee
welfare or incentive plans to which Borrower or any of Borrower's
Subsidiaries is a party, and there are no strikes, lockouts, work
stoppages or slowdowns, or, to the best knowledge of Borrower,
jurisdictional disputes or organizing activities occurring or
threatened which alone or in the aggregate are reasonably likely to
have a Material Adverse Effect.
(s) No Material Adverse Effect. No event has occurred and no
condition exists which could reasonably be expected to have a Material
Adverse Effect.
(t) Accuracy of Information Furnished. None of the Credit
Documents and none of the other certificates, statements or information
furnished to Bank Party by or on behalf of Borrower or any of its
Subsidiaries in connection with the Credit Documents or the
transactions contemplated thereby (taken together with all such Credit
Documents, certificates, statements or information) contains or will
contain any untrue statement of a material fact or omits or will omit
to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading
(it being understood by the Bank Parties that the projections and
forecasts provided by Borrower are not to be viewed as facts and that
actual results during the period or periods covered by such projections
and forecasts may differ from the projected or forecasted results).
4.02. Reaffirmation. Borrower shall be deemed to have reaffirmed, for
the benefit of the Agents and Bank Parties, each representation and warranty
contained in Paragraph 4.01 on and as of the date of each Credit Event (except
for representations and warranties expressly made as of a specified date, which
shall be true as of such date).
54
SECTION V. COVENANTS.
5.01. Affirmative Covenants. Until the termination of this Agreement
and the satisfaction in full by Borrower of all Obligations (other than inchoate
indemnity obligations of Borrower), Borrower will comply, and will cause
compliance, with the following affirmative covenants, unless Majority Banks
shall otherwise consent in writing:
(a) Financial Statements, Reports, etc. Borrower shall furnish
to Administrative Agent (and Administrative Agent shall promptly
thereupon furnish to each Bank) the following, each in such form and
such detail as Administrative Agent shall reasonably request:
(i) As soon as available and in no event later than
forty-five (45) days after the last day of each fiscal quarter
of Borrower which is not a fiscal year end, a copy of the
unaudited Financial Statements of Borrower for such quarter
and for the fiscal year to date (excluding statements of
shareholders' equity), certified by an Executive Officer of
Borrower to present fairly the financial condition, results of
operations and other information reflected therein and to have
been prepared in accordance with GAAP (subject to normal
year-end audit adjustments);
(ii) As soon as available and in no event later than
ninety (90) days after the close of each fiscal year of
Borrower, (A) copies of the audited consolidated Financial
Statements of Borrower for such fiscal year, audited by a
nationally recognized accounting firm and (B) copies of the
unqualified opinions (or qualified opinions reasonably
acceptable to Agents);
(iii) Contemporaneously with the quarterly and
year-end Financial Statements required by the foregoing
clauses (i) and (ii), (A) a certificate of an Executive
Officer of Borrower in the form of Exhibit E, appropriately
completed, together with such financial computations as Agents
may reasonably request to determine compliance with the terms
of this Agreement (a "Compliance Certificate") and (B)
management's discussion of Borrower's operations for the
period covered by such Financial Statements in the form
supplied to Borrower's stockholders, including a comparison
with Borrower's operations for the corresponding quarter in
the immediately preceding fiscal year or with the immediately
preceding fiscal year, as the case may be, as set forth in
Borrower's 10-K and 10-Q reports filed by Borrower or any of
its
55
Subsidiaries with the Securities and Exchange Commission;
(iv) As soon as possible and in no event later than
five (5) Business Days after any Executive Officer of Borrower
or any Vice President of Human Resources of Borrower knows of
the occurrence or existence of (A) any Reportable Event under
any Employee Benefit Plan or Multiemployer Plan, (B) any
litigation, suits or claims against Borrower or its
Subsidiaries involving claimed monetary damages payable by
Borrower or any of its Subsidiaries of $25,000,000 or more not
covered by insurance, (C) any other event or condition which
is reasonably likely to have a Material Adverse Effect, or (D)
any Default or Event of Default; the statement of an Executive
Officer of Borrower setting forth details of such event,
condition, Default or Event of Default and the action which
Borrower proposes to take with respect thereto;
(v) As soon as available and in no event later than
five (5) Business Days after they are sent, made available or
filed, copies of (A) all registration statements filed on
forms X-0, X-0, X-0 or S-4 and 8-K, 10-K and 10-Q reports and
such additional material reports filed by Borrower or any of
its Subsidiaries with any securities exchange or the
Securities and Exchange Commission; (B) all reports, proxy
statements and financial statements sent or made available by
Borrower or any of its Subsidiaries to its public security
holders generally; and (C) all press releases and other
similar public statements concerning any material developments
in the business of Borrower or any of Borrower's Subsidiaries
made available by Borrower or any of Borrower's Subsidiaries
to the public generally; and
(vi) Such other certificates, opinions, statements,
documents and information relating to the operations or
condition (financial or otherwise) of Borrower or any of its
Subsidiaries, and compliance by Borrower with the terms of
this Agreement and the other Credit Documents as any Bank
Party through Administrative Agent may from time to time
reasonably request.
Notwithstanding the foregoing, it is understood and agreed that to the
extent Borrower files Forms 10-K and 10-Q (or any successor forms) with
the Securities and Exchange Commission (or any successor agency) and
such forms are required to contain the same information as required by
clauses (i), (ii) and (iii) (B) of Subparagraph 5.01(a),
56
Borrower may deliver copies of such forms with respect to the relevant
time periods in lieu of the deliveries specified in clauses (i), (ii)
and (iii) (B) of Subparagraph 5.01(a) when such reports are required to
be filed with the Securities and Exchange Commission.
(b) Books and Records. Borrower and its Subsidiaries shall at
all times keep proper books of record and account in accordance with
good business practices and GAAP (and, in the case of Foreign
Subsidiaries, local accounting rules or GAAP to the extent required).
(c) Inspections. Borrower and its Subsidiaries shall permit
personnel of Administrative Agent and, if no Default or Event of
Default has occurred and is continuing, with the consent of Borrower
(which consent shall not be unreasonably withheld or delayed), any
Person designated by Administrative Agent, upon reasonable notice and
during normal business hours, to visit and inspect any of the
properties and offices of Borrower and its Subsidiaries, to examine the
books and records of Borrower and its Subsidiaries and make copies
thereof and to discuss the affairs, finances and accounts of Borrower
and its Subsidiaries with, and to be advised as to the same by, their
officers, auditors and accountants, all at such times and intervals as
Administrative Agent may reasonably request. Notwithstanding any
provision of this Agreement to the contrary, so long as no Default or
Event of Default shall have occurred and be continuing, neither
Borrower nor any of its Subsidiaries shall be required to disclose,
permit the inspection, examination, photocopying or making extracts of,
or discuss, any document, information or other matter that (i)
constitutes non-financial trade secrets or non-financial proprietary
information or (ii) the disclosure of which to any Bank Party, or their
designated representative, is then prohibited by law or any agreement
binding on Borrower or any of its Subsidiaries that was not entered
into by Borrower or any such Subsidiary for the purpose of concealing
information from the Bank Parties.
(d) Insurance. Borrower and its Subsidiaries shall:
(i) Carry and maintain insurance of the types and in
the amounts customarily carried from time to time during the
term of this Agreement by others engaged in substantially the
same business as such Person and operating in the same
geographic area as such Person, including, but not limited to,
fire, public liability, property damage and worker's
compensation; and
57
(ii) Deliver to Administrative Agent from time to
time, as Administrative Agent may request, schedules setting
forth all insurance then in effect.
(iii) Notwithstanding clauses (i) and (ii) above,
Borrower and any of its Subsidiaries may self-insure in lieu
of maintaining all or a portion of the insurance required to
be maintained pursuant to this Subsection 5.01(d) to the
extent determined by Borrower's Board of Directors to be
appropriate and in the best interests of Borrower and its
Subsidiaries taken as a whole.
(e) Governmental Charges. Borrower and its Subsidiaries shall
promptly pay and discharge when due all taxes and other Governmental
Charges prior to the date upon which penalties accrue thereon which, if
unpaid, are reasonably likely to have a Material Adverse Effect, except
such taxes and other Governmental Charges as may in good faith be
contested or disputed, or for which arrangements for deferred payment
have been made, provided that in each such case appropriate reserves
are maintained in accordance with GAAP.
(f) Use of Proceeds. Borrower shall use the proceeds of the
Revolving Loans and the Letters of Credit only for the respective
purposes set forth in Subparagraph 2.01(g) and Subparagraph 2.02(g).
Borrower shall not use any part of the proceeds of any Revolving Loan
or any Letter of Credit, directly or indirectly, for the purpose of
purchasing or carrying any Margin Stock or for the purpose of
purchasing or carrying or trading in any securities under such
circumstances as to involve Borrower, any Bank Party or any Agent in a
violation of Regulations G, T, U or X issued by the Federal Reserve
Board.
(g) General Business Operations. Each of Borrower and its
Subsidiaries shall (i) subject to Subparagraph 5.02(c) and 5.02(d),
preserve and maintain its corporate existence and all of its material
rights, privileges and franchises reasonably necessary to the conduct
of its business, (ii) conduct its business activities in compliance
with all Requirements of Law and Contractual Obligations applicable to
such Person, the violation of which is reasonably likely to have a
Material Adverse Effect, (iii) keep all property useful and necessary
in its business in good working order and condition, ordinary wear and
tear excepted in accordance with prudent business practices, and (iv)
pay and perform all Contractual Obligations as and when due (except to
the extent disputed in good faith by Borrower or the appropriate
Subsidiary and where non-payment would not be reasonably expected to
have a Material Adverse Effect). Borrower shall maintain its chief
executive office and principal
58
place of business in the United States and shall not relocate its chief
executive office or principal place of business outside of California
without providing Administrative Agent with prior written notice.
5.02. Negative Covenants. Until the termination of this Agreement and
the satisfaction in full by Borrower of all Obligations (other than inchoate
indemnity obligations of Borrower), Borrower will comply, and will cause
compliance, with the following negative covenants, unless Majority Banks shall
otherwise consent in writing:
(a) Indebtedness. Neither Borrower nor any of its Subsidiaries
shall create, incur, assume or permit to exist any Indebtedness or any
Guaranty Obligations except for the following ("Permitted
Indebtedness"):
(i) The Obligations of Borrower under the Credit
Documents;
(ii) Indebtedness listed in the Disclosure Letter
existing on the date of this Agreement;
(iii) Indebtedness of Borrower and its Subsidiaries
under loans and Capital Leases incurred by Borrower or any of
its Subsidiaries to finance the acquisition by such Person of
real property, fixtures, equipment or other fixed assets
provided that in each case, (A) such Indebtedness is incurred
by such Person at the time of, or not later than six (6)
months after, the acquisition by such Person of the property
so financed and (B) such Indebtedness does not exceed the
purchase price of the property so financed;
(iv) Indebtedness arising from the endorsement of
instruments for collection in the ordinary course of
Borrower's or a Subsidiary's business;
(v) Indebtedness of Borrower under the Convertible
Subordinated Debentures;
(vi) Indebtedness of Borrower under the External LC
Agreement, provided that (A) the only credit extended to
Borrower pursuant to the External LC Agreement consists of
letters of credit issued for the benefit of MKE or its
affiliates to secure obligations owed by Borrower to the
beneficiaries for the purchase price of inventory; (B) the sum
at any time of the aggregate face amount of all letters of
credit issued and outstanding under the External LC Agreement
plus the aggregate amount of all unreimbursed drawings under
such letters of credit does not exceed eighty-five
59
million Dollars ($85,000,000); (C) the Indebtedness of
Borrower under the External LC Agreement is at all times
either unsecured or secured by Liens permitted pursuant to
clause (xvii) of Subparagraph 5.02(b); and (D) the financial
covenants of Borrower set forth in the External LC Agreement
are less restrictive than the financial covenants set forth on
Schedule 5.02(a);
(vii) Subordinated Indebtedness of Borrower to any
Person, provided that (A) such Indebtedness contains
subordination provisions no less favorable to the Agents and
Banks than those set forth on Exhibit F or as otherwise
approved by the Majority Banks; and (B) the aggregate
principal amount of all Subordinated Debt of Borrower
outstanding (including the Convertible Subordinated
Debentures), measured at the time of issuance of such
Subordinated Debt, does not exceed $700,000,000;
(viii) Indebtedness of the type described in clause
(h) of the definition of "Indebtedness" or clause (iii) of the
definition of "Contingent Obligations";
(ix) Indebtedness of Borrower and its Subsidiaries
with respect to surety, appeal, indemnity, performance or
other similar bonds in the ordinary course of business;
(x) Indebtedness of Borrower and its Subsidiaries
under initial or successive refinancings of any Indebtedness
permitted by clause (ii), (iii) or (vi) above, provided that
the principal amount of any such refinancing does not exceed
the principal amount of the Indebtedness being refinanced;
(xi) Indebtedness of Borrower and its Subsidiaries
for trade accounts payable, provided that (A) such accounts
arise in the ordinary course of business and (B) no material
part of such account is more than ninety (90) days past due
(unless subject to a bona fide dispute and for which adequate
reserves have been established);
(xii) Indebtedness of Borrower and its Subsidiaries
for expense accruals in the ordinary course of business;
(xiii) Guaranty Obligations or Contingent Obligations
of Borrower in respect of Permitted Indebtedness of its
Subsidiaries or Guaranty Obligations or Contingent Obligations
of any Subsidiary of Borrower of the Permitted Indebtedness of
one or
60
more other Subsidiaries of Borrower or of Permitted
Indebtedness of Borrower;
(xiv) Indebtedness of Borrower to any of Borrower's
Subsidiaries, Indebtedness of any of Borrower's Subsidiaries
to Borrower or Indebtedness of any of Borrower's Subsidiaries
to any of Borrower's other Subsidiaries;
(xv) Indebtedness of Borrower and its Subsidiaries in
respect of any Permitted Receivables Facility;
(xvi) Indebtedness of Borrower and its Subsidiaries
under Synthetic Leases;
(xvii) Indebtedness of Borrower and its Subsidiaries
incurred in connection with MKE-Quantum and constituting a
Permitted Investment; and
(xviii) Indebtedness of Borrower and its Subsidiaries
not otherwise permitted hereunder, provided that the aggregate
principal amount of all such Indebtedness does not exceed at
any time ten percent (10%) of the total assets of Borrower and
its Subsidiaries determined as of the end of the fiscal
quarter immediately preceding the date of determination.
(b) Liens. Neither Borrower nor any of its Subsidiaries shall
create, incur, assume or permit to exist any Lien on or with respect to
any of its assets or property of any character, whether now owned or
hereafter acquired, except for the following ("Permitted Liens"):
(i) Liens in favor of any Agent or any Bank securing
the Obligations;
(ii) Liens listed in Disclosure Letter existing on
the date of this Agreement;
(iii) Liens for taxes or other governmental charges
not at the time delinquent or thereafter payable without
penalty or being contested in good faith, provided that
adequate reserves for the payment thereof have been
established in accordance with GAAP;
(iv) Liens of carriers, warehousemen, mechanics,
materialmen, vendors, and landlords and other similar Liens
imposed by law incurred in the ordinary course of business for
sums (A) not overdue or (B) being contested in good faith
provided that adequate reserves for the payment thereof have
been established in accordance with GAAP;
61
(v) Deposits under workers' compensation,
unemployment insurance and social security laws or to secure
the performance of bids, tenders, contracts (other than for
the repayment of borrowed money) or leases, or to secure
statutory obligations of surety or appeal bonds or to secure
indemnity, performance or other similar bonds in the ordinary
course of business;
(vi) Zoning restrictions, easements, rights-of-way,
title irregularities and other similar encumbrances, which
alone or in the aggregate are not substantial in amount and do
not materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business
of Borrower or any of its Subsidiaries;
(vii) Liens securing Indebtedness which constitutes
Permitted Indebtedness under clause (iii) of Subparagraph
5.02(a) provided that, in each case, such Lien (A) covers only
those assets, the acquisition of which was financed by such
Permitted Indebtedness (together with accessions, additions,
replacements and proceeds thereof), and (B) secures only such
Permitted Indebtedness and any related obligations of Borrower
or any of its Subsidiaries;
(viii) Liens on the property or assets of any
Subsidiary of Borrower in favor of Borrower or any other
Subsidiary of Borrower;
(ix) Banker's Liens and similar Liens (including
set-off rights) in respect of bank deposits;
(x) Liens incurred in connection with the extension,
renewal or refinancing of the Indebtedness secured by the
Liens described in clause (ii) or (vii) above, provided that
any extension, renewal or replacement Lien (A) is limited to
the property covered by the terms of the existing Lien and (B)
secures Indebtedness which is no greater in amount and has
material terms no less favorable to the Banks than the
Indebtedness secured by the existing Lien;
(xi) Liens on property or assets of any corporation
which becomes a Subsidiary of Borrower after the date of this
Agreement, provided that (A) such Liens exist at the time the
stock of such corporation is acquired by Borrower and (B) such
Liens were not created in contemplation of such acquisition by
Borrower;
62
(xii) Judgement Liens, provided that such Liens do
not have a value in excess of $10,000,000 or such Liens are
released, stayed, vacated or otherwise dismissed within thirty
(30) days after issue or levy and, if so stayed, such stay is
not thereafter removed;
(xiii) Rights of vendors or lessors under conditional
sale agreements, Capital Leases or other title retention
agreements, provided that, in each case, (A) such rights
secure or otherwise relate to Permitted Indebtedness, (B) such
rights do not extend to any property other than property
acquired with the proceeds of such Permitted Indebtedness
(together with accessions, additions, replacements and
proceeds thereof) and (C) such rights do not secure any
Indebtedness other than such Permitted Indebtedness;
(xiv) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties and in connection with the importation of goods
in the ordinary course of Borrower's and its Subsidiaries'
businesses;
(xv) Liens on insurance proceeds in favor of
insurance companies with respect to the financing of insurance
premiums;
(xvi) Liens in respect of any Permitted Receivables
Facility;
(xvii) Liens on cash or Cash Equivalents securing
reimbursement obligations of Borrower under letters of credit
(other than any Letters of Credit) in an aggregate amount of
all such cash and Cash Equivalents does not exceed
$100,000,000;
(xviii) Liens securing Indebtedness and any related
obligations of Borrower or any of its Subsidiaries which
constitutes Permitted Indebtedness under clause (xvi) of
Subparagraph 5.02(a) (or refinancings of such Indebtedness
under clause (x) of Subparagraph 5.02(a)), provided that such
Lien covers only those assets subject to such Synthetic Leases
(together with accessions, additions, replacements and
proceeds thereof);
(xix) Liens securing any obligations of Borrower or
any of its Subsidiaries under the Prior Credit Agreement or
any security agreements, pledge agreements, charges,
debentures, agreements, documents, certificates or
undertakings entered into in connection therewith or pursuant
thereto; provided that Borrower,
63
its Subsidiaries and the agents and the banks that are a party
to the Prior Credit Agreement shall use their best efforts to
terminate any such Liens within three (3) months of the
Closing Date;
(xx) Liens incurred in connection with leases,
subleases, licenses and sublicenses granted to Persons not
interfering in any material respect with the business of
Borrower and its Subsidiaries and any interest or title of a
lessee or licensee under any such leases, subleases, licenses
or sublicenses;
(xxi) Liens securing Indebtedness and any related
obligations which constitute Permitted Indebtedness under
clause (xvii) of Subparagraph 5.02(a) or Investments
constituting Permitted Investments under clause (ix) of
Subparagraph 5.02(d); and
(xxii) Liens on the property or assets of Borrower
and its Subsidiaries not otherwise permitted hereunder,
provided that (A) the aggregate principal amount of all
Indebtedness secured by such Liens does not exceed at any time
ten percent (10%) of the total assets of Borrower and its
Subsidiaries determined as of the end of the fiscal quarter
immediately preceding the date of determination and (B) such
Liens do not encumber current assets of Borrower and its
Subsidiaries in excess of $50,000,000.
(c) Asset Dispositions. Neither Borrower nor any of its
Subsidiaries shall Transfer all or any of its assets or property,
whether now owned or hereafter acquired, except for the following:
(i) Transfers by Borrower and its Subsidiaries in the
ordinary course of their businesses;
(ii) Transfers of surplus, damaged, worn or obsolete
assets or properties or Transfers of other assets or
properties which are promptly being replaced;
(iii) Transfers of assets on commercially reasonable
terms or account receivables in connection with a Permitted
Receivables Facility by Borrower and its Subsidiaries (it
being understood that any determination as to whether a
particular Transfer is on commercially reasonable terms shall
take into consideration any larger business transaction to
which such particular Transfer is related);
64
(iv) Transfers by Borrower to any of Borrower's
Subsidiaries or by any of Borrower's Subsidiaries to Borrower
or any of Borrower's other Subsidiaries;
(v) Transfers which constitute the making of or
liquidation of Permitted Investments;
(vi) Transfers in connection with Indebtedness
permitted pursuant to clause (iii) of Subparagraph 5.02(a);
and
(vii) Transfers of assets and property not otherwise
permitted hereunder, provided that the aggregate value of all
such assets and property (based upon the greater of the fair
market or book value of such assets and property) so
transferred in any period of four consecutive fiscal quarters
does not exceed twenty percent (20%) of Tangible Net Worth as
determined as of the end of the fiscal quarter immediately
preceding the date of determination.
(d) Mergers, Acquisitions, Etc. Neither Borrower nor any of
its Subsidiaries shall consolidate with or merge into any other Person
or permit any other Person to merge into it, except that:
(i) Any Subsidiary of Borrower may merge into or
consolidate with any other Subsidiary of Borrower;
(ii) Any Subsidiary of Borrower may merge into or
consolidate with Borrower provided that Borrower is the
surviving corporation;
(iii) Borrower may merge into or consolidate with any
other Person, provided that (A) Borrower is the surviving
corporation and (B) immediately after giving effect to such
merger or consolidation no Default or Event of Default shall
have occurred and be continuing; and
(iv) Any Subsidiary of Borrower may merge into or
consolidate with any other Person to the extent such
transaction is a Transfer otherwise permitted under
Subparagraph 5.02(c) or an Investment otherwise permitted
under Subparagraph 5.02(e) and immediately after giving effect
to such merger or consolidation no Default or Event of Default
shall have occurred and be continuing.
(e) Investments. Neither Borrower nor any of its Subsidiaries
shall make any Investment except the following ("Permitted
Investments"):
65
(i) Direct obligations of, or obligations the
principal and interest on which are unconditionally guaranteed
by, the United States of America or obligations of any agency
of the United States of America to the extent such obligations
are backed by the full faith and credit of the United States
of America, in each case maturing within one year from the
date of acquisition thereof;
(ii) Certificates of deposit maturing within one year
from the date of acquisition thereof issued by a commercial
bank or trust company organized under the laws of the United
States of America or a state thereof or that is a Bank,
provided that (A) such deposits are denominated in Dollars,
(B) such bank or trust company has capital, surplus and
undivided profits of not less than $100,000,000 and (C) such
bank or trust company has certificates of deposit or other
debt obligations rated at least A-1 (or its equivalent) by S&P
or P-1 (or its equivalent) by Moody's;
(iii) Open market commercial paper maturing within
270 days from the date of acquisition thereof issued by a
corporation organized under the laws of the United States of
America or a state thereof, provided such commercial paper is
rated at least A-1 (or its equivalent) by S&P or P-1 (or its
equivalent) by Moody's;
(iv) Any repurchase agreement entered into with a
commercial bank or trust company organized under the laws of
the United States of America or a state thereof or that is a
Bank, provided that (A) such bank or trust company has
capital, surplus and undivided profits of not less than
$100,000,000, (B) such bank or trust company has certificates
of deposit or other debt obligations rated at least A-1 (or
its equivalent) by S&P or P-1 (or its equivalent) by Moody's,
(C) the repurchase obligations of such bank or trust company
under such repurchase agreement are fully secured by a
perfected security interest in a security or instrument of the
type described in clause (i), (ii) or (iii) above and (D) such
security or instrument so securing the repurchase obligations
has a fair market value at the time such repurchase agreement
is entered into of not less than one hundred percent (100%) of
such repurchase obligations;
(v) Any transaction permitted by Subparagraph 5.02(a)
or Subparagraph 5.02(d);
66
(vi) Money market mutual funds registered with the
Securities and Exchange Commission, meeting the requirements
of Rule 2a-7 promulgated under the Investment Company Act of
1940;
(vii) Investments listed in the Disclosure Letter
existing on the date of this Agreement;
(viii) Investments in other assets properly
classified as "marketable securities" or "cash" or "cash
equivalents" under GAAP, and which conform to the investment
policies adopted by the Board of Directors of Borrower from
time to time;
(ix) (A) Investments in MKE-Quantum in the form of
(w) non-exclusive licenses of technology to MKE-Quantum, (x)
tax or other indemnity obligations of Borrower or any of its
Subsidiaries in favor of MKE-Quantum, (y) advances against
product to be purchased by Borrower or any of its Subsidiaries
from MKE-Quantum within a period of one year from the date of
the making of the advance, and (z) (1) the value of any
property transferred or leased to MKE-Quantum, (2) employee
benefit obligations of Borrower or any of its Subsidiaries in
favor of any employees of MKE-Quantum, (3) the value of the
administrative services provided by Borrower or any of its
Subsidiaries in favor of MKE-Quantum, (4) the value of any
personnel services provided by Borrower or any of its
Subsidiaries in favor of MKE-Quantum, and (5) the value of the
use and occupancy of any facilities provided by Borrower or
any of its Subsidiaries, in the case of each of (1) through
(5) above, to the extent Borrower or any of its Subsidiaries
is, or expects to be, reimbursed therefor, within one year of
when such value is provided to MKE-Quantum, and (B)
additional Investments in MKE-Quantum, provided that the
aggregate amount of all such Investments made or incurred
after the Closing Date pursuant to the subclause (B) of this
clause (ix) in any rolling four fiscal quarter period of
Borrower does not exceed the sum of $100,000,000 plus any
amounts actually received by Borrower or any of its
Subsidiaries as a return of Investments in MKE-Quantum during
such rolling four quarter period plus any reductions in the
primary obligations in underlying Investments constituting
Guaranty Obligations during such rolling four fiscal quarter
period; provided further that for purposes hereof, Investments
constituting Indebtedness of MKE-Quantum acquired by Borrower
or any of its Subsidiaries shall be deemed to be in an amount
equal to such Indebtedness and to be made when such
Indebtedness is acquired (unless such
67
Investment is a primary obligation underlying a Guaranty
Obligation previously counted as an Investment) and
Investments constituting Guaranty Obligations shall be deemed
to be in an amount equal to the corresponding primary
obligations and to be made at the time such primary
obligations are incurred;
(x) Investments received by Borrower and its
Subsidiaries in connection with the bankruptcy or
reorganization of customers and suppliers and in settlement of
delinquent obligations of, and other disputes with, customers
and suppliers arising in the ordinary course of business;
(xi) Investments arising from rights received by
Borrower and its Subsidiaries upon the required payment of any
permitted Contingent Obligations of Borrower and its
Subsidiaries;
(xii) Investments in or to Borrower or any Wholly-
Owned Subsidiary of Borrower;
(xiii) Investments of any Subsidiary of Borrower
existing at the time it becomes a Subsidiary of Borrower
provided that such Investments were not made in anticipation
of such Person becoming a Subsidiary of Borrower;
(xiv) Investments received by Borrower or any of its
Subsidiaries as consideration in connection with Transfers
otherwise permitted under Subparagraph 5.02(c);
(xv) Investments in the nature of acquisitions
provided that the aggregate amount of such acquisitions in any
period of four consecutive fiscal quarters does not exceed
twenty percent (20%) of Tangible Net Worth as determined as of
the fiscal quarter immediately preceding the date of
determination;
(xvi) Investments consisting of loans to employees,
officers and directors, the proceeds of which shall be used to
purchase equity securities of Borrower or its Subsidiaries and
other loans to employees, officers and directors;
(xvii) Investments of Borrower and its Subsidiaries
in interest rate protection, currency swap and foreign
exchange arrangements, provided that all such arrangements are
entered into in connection with bona fide hedging operations
and not for speculation;
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(xviii) Deposit accounts; and
(xix) Investments (other than of the type set forth
in clause (xiv) above) not otherwise permitted hereunder,
provided that the aggregate amount of such other Investments
made after the Closing Date (less any return of such
Investment) does not exceed twenty percent (20%) of Tangible
Net Worth as determined as of the fiscal quarter immediately
preceding the date of determination.
(f) Dividends, Redemptions, Etc. Neither Borrower nor any of
its Subsidiaries shall pay any dividends or make any distributions on
its Equity Securities; purchase, redeem, retire, defease or otherwise
acquire for value any of its Equity Securities; return any capital to
any holder of its Equity Securities as such; make any distribution of
assets, Equity Securities, obligations or securities to any holder of
its Equity Securities as such; or set apart any sum for any such
purpose, except as follows:
(i) Borrower may pay dividends on its Equity
Securities payable solely in Borrower's own Equity Securities;
(ii) Borrower may purchase, redeem, retire, defease
or otherwise acquire for value Equity Securities in connection
with or pursuant to any of its Employee Benefit Plans or in
connection with the employment or compensation of officers or
directors;
(iii) Borrower may purchase, redeem, retire, defease
or otherwise acquire for value Equity Securities with the
proceeds received from a substantially concurrent issue of new
Equity Securities or with other Equity Securities;
(iv) Borrower may purchase Equity Securities pursuant
to stock repurchase programs provided that the aggregate
payments under such programs do not exceed ten percent (10%)
of Tangible Net Worth in any fiscal year as determined as of
the fiscal quarter immediately preceding the date of
determination;
(v) Borrower may distribute rights pursuant to a
shareholder rights plan or redeem such rights provided such
redemption is in accordance with the terms of such shareholder
rights plan;
(vi) Any Subsidiary of Borrower may pay dividends or
make distributions to Borrower or any Wholly-Owned Subsidiary
of Borrower;
69
(vii) Any Subsidiary of Borrower may purchase and
redeem shares of their own Equity Securities from Borrower or
any Wholly-Owned Subsidiary of Borrower; or
(viii) Any Subsidiary of Borrower may declare or pay
any dividends in respect of its Equity Securities or purchase
or redeem shares of its Equity Securities or make
distributions to shareholders not otherwise permitted
hereunder provided that the aggregate amount paid or
distributed in any period of four consecutive quarters
(excluding any amounts covered by clauses (vi) or (vii) above)
does not exceed five percent (5%) of Tangible Net Worth as
determined as of the fiscal quarter immediately preceding the
date of determination.
(g) Change in Business. Neither Borrower nor any of its
Subsidiaries shall engage, either directly or indirectly through
Affiliates, in any line of business other than the digital storage
business, any other business incidental or reasonably related thereto,
or any businesses that are, as determined by the Board of Directors of
Borrower, appropriate extensions thereof.
(h) Certain Indebtedness Payments, Etc. Neither Borrower nor
any of its Subsidiaries shall pay, prepay, redeem, purchase, defease or
otherwise satisfy in any manner prior to the scheduled payment thereof
any Subordinated Debt except as otherwise permitted under this
Subparagraph 5.02(h); amend, modify or otherwise change the terms of
any document, instrument or agreement evidencing Subordinated Debt such
that such amendment, modification or change would (i) cause the
outstanding aggregate principal amount of all such Subordinated Debt so
amended, modified or changed to be increased as a consequence of such
amendment, modification or change, (ii) cause the subordination
provisions applicable to such Subordinated Debt to be less favorable to
the Agents and the Bank Parties than those set forth on Exhibit F,
(iii) increase the interest rate applicable thereto or (iv) accelerate
the scheduled payment thereof, except that Borrower may call for
redemption the entire outstanding amount of the Convertible
Subordinated Debentures and, to the extent such Convertible
Subordinated Debentures are not converted prior to the redemption date,
redeem such Convertible Subordinated Debentures, provided that (A) no
Default or Event of Default has occurred and is continuing or would
result from such call for redemption or redemption and (B) the closing
price of the common stock shall have exceeded one hundred twenty
percent (120%) of the then applicable conversion price for twenty (20)
trading days within a period of thirty (30) consecutive trading days
ending within five (5) trading days prior to the notice of
70
redemption. Borrower shall not cause or permit any of its obligations,
except the obligations constituting Senior Indebtedness to constitute
"Designated Senior Indebtedness" under the Indenture governing the
Convertible Subordinated Debentures (it being understood that the
Obligations of Borrower under this Agreement shall at all times
constitute "Designated Senior Indebtedness").
(i) ERISA. Neither Borrower nor any ERISA Affiliate shall (i)
adopt or institute any defined benefit Employee Benefit Plan that is an
employee pension benefit plan within the meaning of Section 3(2) of
ERISA, (ii) take any action which will result in the partial or
complete withdrawal, within the meanings of sections 4203 and 4205 of
ERISA, from a Multiemployer Plan, (iii) engage or permit any Person to
engage in any transaction prohibited by section 406 of ERISA or section
4975 of the Code involving any Employee Benefit Plan or Multiemployer
Plan which would subject either Borrower or any ERISA Affiliate to any
tax, penalty or other liability including a liability to indemnify,
(iv) incur or allow to exist any accumulated funding deficiency (within
the meaning of section 412 of the Code or section 302 of ERISA),
excluding all extensions permitted by law or contract, (v) fail to make
full payment when due of all amounts due as contributions to any
Employee Benefit Plan or Multiemployer Plan, (vi) fail to comply with
the requirements of section 4980B of the Code or Part 6 of Title I(B)
of ERISA, or (vii) adopt any amendment to any Employee Benefit Plan
which would require the posting of security pursuant to section
401(a)(29) of the Code, if any of such actions or inactions described
in clauses (i) - (vii), either individually or cumulatively, would have
a Material Adverse Effect.
(j) Transactions With Affiliates. Neither Borrower nor any of
its Subsidiaries shall enter into any Contractual Obligation with any
Affiliate or engage in any other transaction with any Affiliate except
upon terms at least as favorable to Borrower or such Subsidiary as an
arms-length transaction with unaffiliated Persons.
(k) Accounting Changes. Neither Borrower nor any of its
Subsidiaries shall change (i) its fiscal year (currently April 1 -
March 31) or (ii) its accounting practices except as permitted by GAAP.
(l) Financial Covenants.
(i) Borrower shall not permit its Quick Ratio to be
less than 1.00 to 1.00 on the last day of each fiscal quarter.
71
(ii) Borrower shall not permit its Tangible Net Worth
on any date of determination (such date to be referred to
herein as a "determination date") which occurs after March 31,
1997 (such date to be referred to herein as the "base date")
to be less than the sum on such determination date of the
following:
(A) $760,000,000;
plus
(B) Seventy-five percent (75%) of the sum of
Borrower's consolidated quarterly net income
(ignoring any quarterly losses) for each quarter
after the base date through and including the quarter
ending immediately prior to the determination date;
plus
(C) Seventy-Five percent (75%) of the Net
Proceeds of all Equity Securities issued by Borrower
and its Subsidiaries (excluding any issuance where
the total proceeds are less than $10,000,000) during
the period commencing on the base date and ending on
the determination date;
plus
(D) Ninety percent (90%) of the Net Proceeds
derived from the conversion of the Convertible
Subordinated Debentures;
minus
(E) the lesser of (1) the aggregate amount
paid by Borrower to repurchase its capital stock and
(2) $50,000,000.
(iii) In any consecutive four-quarter period,
Borrower shall not permit (A) more than two quarterly net
losses aggregating to more than five percent (5%) of its
Tangible Net Worth as determined as of the fiscal quarter
immediately preceding the date of determination or (B) its
cumulative net income for any consecutive four-quarter period
to be less than one Dollar.
(iv) Borrower shall not permit its Senior Funded Debt
Ratio on the last day of any fiscal quarter to exceed
thirty-five percent (35%).
72
SECTION VI. DEFAULT.
6.01. Events of Default. The occurrence or existence of any one or more
of the following shall constitute an "Event of Default" hereunder:
(a) Borrower (i) shall fail to pay when due any principal
payment on the Revolving Loans or any Reimbursement Payment, (ii) shall
fail to pay within three (3) Business Days when due any interest, or
(iii) shall fail to pay when due any other payment required under the
terms of this Agreement or any of the other Loan Documents and such
failure shall continue for five (5) Business Days after notice thereof
has been given to Borrower by any Agent; or
(b) Borrower shall fail to observe or perform any covenant,
obligation, condition or agreement set forth in Paragraph 5.02; or
(c) Borrower shall fail to observe or perform any other
covenant, obligation, condition or agreement contained in this
Agreement or the other Loan Documents and such failure shall continue
for twenty (20) Business Days after the earlier of the date that an
Executive Officer of Borrower first obtains knowledge or notice of such
failure or the date Administrative Agent gives Borrower notice of such
failure; or
(d) Any written representation or warranty by the Borrower
made or deemed made herein or in any Loan Document shall prove to have
been false, incorrect or inaccurate in any material respect on or as of
the date made or deemed made; or
(e) (i) Borrower or any of Borrower's Subsidiaries (A) shall
fail to make a payment or payments in an aggregate amount of $2,500,000
or more when due under the terms of any Funded Debt to be paid by such
Person (excluding this Agreement and the other Credit Documents or any
intercompany Indebtedness between Borrower and any of its Subsidiaries,
but including any other evidence of indebtedness of Borrower or any of
its Subsidiaries to any Bank) and such failure shall continue beyond
any period of grace provided with respect thereto, or (B) shall fail to
make any other payment or payments when due under or otherwise default
in the observance or performance of any other agreement, term or
condition contained in any such Funded Debt, and the effect of such
failure or default is to cause, or permit the holder or holders thereof
to cause, indebtedness in an aggregate amount of $10,000,000 or more to
become due prior to its stated date of maturity; or (ii) there shall
occur or exist any other event or condition which causes, or permits
the
73
holder or holders of such indebtedness to cause, indebtedness in an
aggregate amount of $10,000,000 or more to become due prior to its
stated date of maturity (whether through holder puts, mandatory
redemptions or prepayments or otherwise); or
(f) Borrower or any of Borrower's Material Subsidiaries
(except with respect to clause (v) below) shall (i) apply for or
consent to the appointment of a receiver, trustee, liquidator or
custodian of itself or of all or a substantial part of its property,
(ii) be unable, or admit in writing its inability, to pay its debts
generally as they mature, (iii) make a general assignment for the
benefit of its or any of its creditors, (iv) be dissolved or liquidated
in full or in part, (v) no longer be Solvent, (vi) commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or consent
to any such relief or to the appointment of or taking possession of its
property by any official in an involuntary case or other proceeding
commenced against it, or (vii) take any action for the purpose of
effecting any of the foregoing; or
(g) Proceedings for the appointment of a receiver, trustee,
liquidator or custodian of Borrower or any of Borrower's Material
Subsidiaries or of all or a substantial part of the property thereof,
or an involuntary case or other proceedings seeking liquidation,
reorganization or other relief with respect to Borrower or any of
Borrower's Material Subsidiaries or the debts thereof under any
bankruptcy, insolvency or other similar law now or hereafter in effect
shall be commenced and an order for relief entered or such proceeding
shall not be dismissed or discharged within sixty (60) days of
commencement; or
(h) A final nonappealable judgment or order for the payment of
money in excess of $10,000,000 (exclusive of amounts which are covered
by insurance issued by an insurer satisfying the requirements set forth
in Subparagraph 5.01(d)) shall be rendered against Borrower or any of
its Subsidiaries and the same shall remain undischarged and unpaid for
a period of thirty (30) days during which execution shall not be
effectively stayed; or
(i) Any Credit Document or any material term thereof shall
cease to be, or be asserted by Borrower not to be, a legal, valid and
binding obligation of Borrower enforceable in accordance with its
terms, the effect of which is or could reasonably be expected to be to
interfere with, hinder or impair in any material respect the practical
or effective realization of the rights, benefits or remedies of the
74
Agents or the Banks under any Credit Documents taken as a whole; or
(j) Any Reportable Event occurs which constitutes grounds for
the termination of any Employee Benefit Plan by the PBGC or for the
appointment of a trustee by the PBGC to administer any Employee Benefit
Plan, or any Employee Benefit Plan shall be terminated with unfunded
liabilities within the meaning of Title IV of ERISA or a trustee shall
be appointed by the PBGC to administer any Employee Benefit Plan, in
each case which could reasonably be expected to have a Material Adverse
Effect; or
(k) Any Change of Control shall occur.
(Any of the events or conditions set forth in Subparagraphs 6.01(a)-(k), prior
to the giving of any required notice or the expiration of any specified grace
period, shall constitute a "Default" hereunder.)
6.02. Remedies. Upon the occurrence or existence of any Event of
Default (other than an Event of Default referred to in Subparagraph 6.01(f) or
6.01(g)) and at any time thereafter during the continuance of such Event of
Default, Administrative Agent may, with the consent of the Majority Banks, or
shall, upon instructions from the Majority Banks, by written notice to Borrower,
(a) terminate the Commitments and the obligations of the Lender Parties to make
Revolving Loans or issue Letters of Credit (b) declare all outstanding
Obligations payable by Borrower to be immediately due and payable without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived, anything contained herein or in the Notes to the
contrary notwithstanding, and/or (c) direct Borrower to deliver to
Administrative Agent funds in an amount equal to the aggregate stated amount of
all outstanding Letters of Credit. Upon the occurrence or existence of any Event
of Default described in Subparagraph 6.01(f) or 6.01(g), immediately and without
notice, (1) the Commitments and the obligations of the Lender Parties to make
Revolving Loans or issue Letters of Credit shall automatically terminate and (2)
all outstanding Obligations payable by Borrower hereunder shall automatically
become immediately due and payable, without presentment, demand, protest or any
other notice of any kind, all of which are hereby expressly waived, anything
contained herein or in the Notes to the contrary notwithstanding. In addition to
the foregoing remedies, upon the occurrence or existence of any Event of
Default, Administrative Agent may exercise any right, power or remedy permitted
to it by law, either by suit in equity or by action at law, or both. Immediately
after taking any action under this Paragraph 6.02, Administrative Agent shall
notify each Bank Party of such action.
75
SECTION VII. AGENTS AND RELATIONS AMONG BANKS.
7.01. Appointment, Powers and Immunities. Each Bank Party hereby
appoints and authorizes Administrative Agent and the Co-Arrangers to act as its
agents hereunder and under the other Credit Documents with such powers as are
expressly delegated to Administrative Agent and the Co-Arrangers by the terms of
this Agreement and the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Neither Administrative Agent nor any
Co-Arranger shall have any duties or responsibilities except those expressly set
forth in this Agreement or in any other Credit Document, be a trustee for any
Bank Party or have any fiduciary duty to any Bank Party. Notwithstanding
anything to the contrary contained herein, neither Administrative Agent nor any
Co-Arranger shall be required to take any action which is contrary to this
Agreement or any other Credit Document or applicable law. Neither Administrative
Agent nor any Co-Arranger nor any Bank Party shall be responsible to any other
Agent or Bank Party for any recitals, statements, representations or warranties
made by Borrower contained in this Agreement or in any other Credit Document,
for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement, or any other Credit Document or for any failure
by Borrower to perform its obligations hereunder or thereunder. Administrative
Agent and the Co-Arrangers may employ agents and attorneys-in-fact and shall not
be responsible to any Bank Party for the negligence or misconduct of any such
agents or attorneys-in-fact selected by them with reasonable care. None of the
Administrative Agent, the Co-Arrangers or their directors, officers, employees
or agents shall be responsible to any Bank Party for any action taken or omitted
to be taken by it or them hereunder or under any other Credit Document or in
connection herewith or therewith, except for its or their own gross negligence
or willful misconduct. Except as otherwise provided under this Agreement,
Administrative Agent shall take such action with respect to the Credit Documents
as shall be directed by the Majority Banks. Administrative Agent shall promptly
furnish to each Bank Party copies of all material documents, reports,
certificates, financial statements and notices furnished to Administrative Agent
by Borrower; provided, however, that Administrative Agent shall not be liable to
any Bank Party for its failure to provide copies of such material documents,
reports, certificates, financial statements and notices unless such failure
constitutes gross negligence or willful misconduct by Administrative Agent.
7.02. Reliance by Agents. Administrative Agent and the Co-Arrangers
shall be entitled to rely upon any certificate, notice or other document
(including any cable, telegram, facsimile or telex) believed by them in good
faith 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
76
legal counsel, independent accountants and other experts selected by
Administrative Agent and the Co-Arrangers with reasonable care. As to any other
matters not expressly provided for by this Agreement, neither Administrative
Agent nor any Co-Arranger shall be required to take any action or exercise any
discretion, but Administrative Agent shall be required to act or to refrain from
acting upon instructions of the Majority Banks and shall in all cases be fully
protected by the Bank Parties in acting, or in refraining from acting, hereunder
or under any other Credit Document in accordance with the instructions of the
Majority Banks, and such instructions of the Majority Banks and any action taken
or failure to act pursuant thereto shall be binding on the Administrative Agent
and all of the Co-Arrangers and Bank Parties.
7.03. Defaults. Neither Administrative Agent nor any Co-Arranger shall
be deemed to have knowledge or notice of the occurrence of any Default or Event
of Default unless Administrative Agent and the Co-Arrangers have received a
notice from a Bank Party or Borrower, referring to this Agreement, describing
such Default or Event of Default and stating that such notice is a "Notice of
Default". If Administrative Agent receives such a notice of the occurrence of a
Default or Event of Default, Administrative Agent shall give prompt notice
thereof to the Co-Arrangers and the Bank Parties. Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Majority Banks; provided, however, that until
Administrative Agent shall have received such directions, Administrative Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Default or Event of Default as it shall deem
advisable in the best interest of the Bank Parties.
7.04. Indemnification. Without limiting the Obligations of Borrower
hereunder, each Bank agrees to indemnify Administrative Agent and the
Co-Arrangers, ratably in accordance with such Bank's Proportionate Share, for
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may at any time be imposed on, incurred by or asserted against
Administrative Agent and the Co-Arrangers in any way relating to or arising out
of this Agreement or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or the enforcement of
any of the terms hereof or thereof or of any such other documents; provided,
however, that no Bank shall be liable for any of the foregoing to the extent
they arise from Administrative Agent and/or the Co-Arrangers' gross negligence
or willful misconduct. Administrative Agent and the Co-Arrangers shall be fully
justified in refusing to take or to continue to take any action hereunder unless
it shall first be indemnified to its satisfaction by the Banks against any and
all liability and
77
expense which may be incurred by it by reason of taking or continuing to take
any such action. The obligations of each Bank under this Paragraph 7.04 shall
survive the payment and performance of the Obligations, the termination of this
Agreement and any Bank ceasing to be a party to this Agreement.
7.05. Non-Reliance. Each Bank Party represents that it has,
independently and without reliance on Administrative Agent, any Co-Arranger or
any other Bank Party, and based on such documents and information as it has
deemed appropriate, made its own appraisal of the financial condition and
affairs of Borrower and the Subsidiaries and its own decision to enter into this
Agreement and agrees that it will, independently and without reliance upon
Administrative Agent, any Co-Arranger or any Bank Party, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own appraisals and decisions in taking or not taking action under this
Agreement. Neither Administrative Agent nor any Co-Arranger nor any Bank Party
shall be required to keep any other Agent or Bank Party informed as to the
performance or observance by Borrower or its Subsidiaries of the obligations
under this Agreement or any other document referred to or provided for herein or
to make inquiry of, or to inspect the properties or books of Borrower. Except
for notices, reports and other documents and information expressly required to
be furnished to the Bank Parties by Administrative Agent hereunder, neither
Administrative Agent nor any Co-Arranger nor any Bank Party shall have any duty
or responsibility to provide any Agent or Bank Party with any credit or other
information concerning Borrower or its Subsidiaries, which may come into the
possession of any Agent or Bank Party or any of its or their Affiliates.
7.06. Resignation or Removal of Administrative Agent. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, Administrative Agent may resign at any time by giving notice thereof to
the Banks, and 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, which
Administrative Agent shall be reasonably acceptable to Borrower. If no successor
Administrative Agent shall have been appointed by the Majority Banks and shall
have accepted such appointment within thirty (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 Bank Parties, appoint a successor Administrative
Agent, which shall be (a) a bank having a combined capital, surplus and retained
earnings of not less than U.S. $500,000,000 and (b) shall be reasonably
acceptable to Borrower; provided, however, that Borrower shall have no right to
approve a successor Agent which is a Bank if an Event of Default has occurred
and is
78
continuing. 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 VII 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 Administrative Agent.
7.07. Removal of Co-Arrangers. If, at any time, any Co-Arranger's share
of the total credit facilities provided by all Banks hereunder is less than six
and one-quarter percent (6.25%), such Co-Arranger may be removed by Borrower
upon thirty (30) days prior written notice from Borrower to Administrative Agent
and such Co-Arranger. Upon any such removal, Borrower shall, at its election,
have the right to appoint another Bank as successor to such removed Co-Arranger,
which successor Co-Arranger shall be reasonably acceptable to the Majority
Banks. If no successor Co-Arranger is appointed for any removed Co-Arranger, all
rights, powers and privileges vested in the Agents hereunder shall be exercised
by Administrative Agent and the remaining Co-Arranger(s) or, if no Co-Arranger
remains, by Administrative Agent alone. Upon the acceptance of any appointment
as a Co-Arranger hereunder by a successor Co-Arranger, such successor
Co-Arranger shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the removed Co-Arranger, and the removed
Co-Arranger shall be discharged from its duties and obligations hereunder. After
any Co-Arranger's removal hereunder as a Co-Arranger, the provisions of this
Section VII 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 a Co-Arranger. For the
purposes of this Paragraph 7.07, a Co-Arranger's share of the total credit
facilities provided by all Banks hereunder at any time shall be (a) if Revolving
Loans are then outstanding, (i) the aggregate principal amount of all Revolving
Loans then outstanding, together with the aggregate stated amount of all Letters
of Credit then outstanding, which are held by such Co-Arranger and its
Affiliates as a Bank or as Banks hereunder, divided by (ii) the aggregate
principal amount of all Revolving Loans then outstanding, together with the
aggregate stated amount of all Letters of Credit then outstanding, held by all
Banks or (b) if no Revolving Loans are then outstanding, the aggregate
Proportionate Share at such time of such Co-Arranger and its Affiliates as a
Bank or as Banks hereunder.
7.08. Authorization. Administrative Agent is hereby authorized by the
Bank Parties to execute, deliver and perform,
79
each of the Credit Documents to which Administrative Agent is or is intended to
be a party and each Bank Party agrees, subject to the terms of this Agreement,
to be bound by all of the agreements of Administrative Agent contained in the
Credit Documents.
7.09. Agents in Their Individual Capacities. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with Borrower and its Subsidiaries and affiliates as though
such Agent were not an Agent hereunder. With respect to Revolving Loans made and
Letters of Credit issued by ABN and CIBC as Banks, ABN and CIBC shall have the
same rights and powers under this Agreement and the other Credit Documents as
any other Bank Party and may exercise the same as though they were not Agents.
7.10. Agents' Communications Binding Upon Banks. Subject to the terms
of this Agreement, the Bank Parties agree that written communications from
Administrative Agent and the Co-Arrangers to Borrower on behalf of the Bank
Parties shall be binding upon the Bank Parties.
7.11. No Obligations of Borrower. Nothing contained in this Article VII
shall be deemed to impose upon Borrower any obligation in respect of the due and
punctual performance by any Agent of its obligations to the Bank Parties under
any provision of this Agreement, and Borrower shall have no liability to any
Agent or Bank Party in respect of any failure by any Agent or Bank Party to
perform any of their respective obligations to each other under this Agreement.
Without limiting the generality of the foregoing sentence, where any provision
of this Agreement relating to the payment of any amounts due and owing under the
Loan Documents provides that such payments shall be made by Borrower to the
Administrative Agent for the account of the Bank Parties, Borrower's obligations
to the Bank Parties in respect of such payments shall be deemed to be satisfied
upon the making of such payments to Administrative Agent in the manner provided
by this Agreement.
7.12. Co-Agents and Documentation Agent. None of the Banks identified
herein as a "co-agent" or as Documentation Agent shall have any right, power,
obligation, liability, responsibility or duty under this Agreement or any other
Credit Document other than those applicable to all Banks as such. Without
limiting the foregoing, none of the Banks so identified as a "co-agent" or as
Documentation Agent shall have or be deemed to have any fiduciary relationship
with any Bank. Each Bank acknowledges that it has not relied, and will not rely,
on any of the Banks identified as "co-agent" or as Documentation Agent in
deciding to enter into this Agreement or in taking or not taking action
hereunder. Without limiting the generality of the foregoing, it is understood
and agreed that the Documentation Agent is not responsible for the validity,
effectiveness,
80
enforceability or sufficiency of this Agreement or any other Credit Document.
SECTION VIII. MISCELLANEOUS.
8.01. Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or upon
Borrower, any Bank Party or any Agent under this Agreement or the other Credit
Documents shall be in writing and faxed, mailed or delivered, if to Borrower or
Administrative Agent at its respective facsimile number or address set forth
below, if to any Bank, at the address or facsimile number specified beneath the
heading "Address for Notices" under the name of such Bank in Schedule I or, if
to Issuing Bank, at the address or facsimile number indicated in the notice
given by Issuing Bank to the other parties at the time any such Issuing Bank is
selected by Borrower and approved by Administrative Agent and the Co-Arrangers
(or to such other facsimile number or address for any party as indicated in any
notice given by that party to the other parties). All such notices and
communications shall be effective (a) when sent by Federal Express or other
overnight service of recognized standing, on the second Business Day following
the deposit with such service; (b) when mailed, first class postage prepaid and
addressed as aforesaid through the United States Postal Service, upon receipt;
(c) when delivered by hand, upon delivery; and (d) when faxed, upon confirmation
of receipt; provided, however, that any notice delivered to Administrative Agent
or Issuing Bank under Section II shall not be effective until received by such
Person.
Administrative
Agent: Canadian Imperial Bank of Commerce
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx
Syndications
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Borrower: Quantum Corporation
000 XxXxxxxx Xxxxxxxxx
Xxxxxxxx, XX 00000
Attn: Xx XxXxxxxx,
Vice President Finance & Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Each Notice of Borrowing, Notice of Conversion, Notice of Interest Period
Selection and LC Application shall be given by
81
Borrower to Administrative Agent and, in the case of an LC Application, to
Issuing Bank, to the office of such Person located at the address referred to
above during such Person's normal business hours; provided, however, that any
such notice received by any such Person after 1:00 P.M. on any Business Day
shall be deemed received by such Person on the next Business Day. In any case
where this Agreement authorizes notices, requests, demands or other
communications by Borrower to any Agent or any Bank Party to be made by
telephone or facsimile, any Agent or any Bank Party may conclusively presume
that anyone purporting to be a person designated in any incumbency certificate
or other similar document received by such Agent or Bank Party is such a person.
8.02. Expenses. Borrower shall pay within ten (10) days after demand,
whether or not any Revolving Loan is made or any Letter of Credit is issued
hereunder, (a) all reasonable fees and expenses payable to third parties,
including each Agent's out-of-pocket expenses and reasonable attorneys' fees and
expenses, incurred by Agents in connection with the preparation, negotiation,
execution and delivery of, and the exercise of their duties under, the Summary
of Terms and Conditions dated May 5, 1997 among Borrower and the Co-Arrangers
and the Agents' Fee Letters and their structuring of, due diligence relating to
and syndication of the credit facilities set forth in this Agreement; (b) all
(i) Attorney Costs and (ii) other reasonable fees and expenses payable to third
parties incurred by Agents in connection with the preparation, negotiation,
execution, delivery and syndication of this Agreement and the other Credit
Documents, and the preparation, negotiation, execution and delivery of
amendments and waivers hereunder and thereunder; (c) all Attorney Costs and
other reasonable fees and expenses payable to third parties incurred by Agents
in connection with the exercise of their rights or duties under this Agreement
and the other Credit Documents; and (d) all Attorney Costs and other reasonable
fees and expenses payable to third parties incurred by any Agent or any Bank
Party in the enforcement or attempted enforcement of any of the Obligations or
in preserving any of Agents' or the Banks' rights and remedies (including all
such fees and expenses incurred in connection with any "workout" or
restructuring affecting the Credit Documents or the Obligations or any
bankruptcy or similar proceeding involving Borrower or any of its Subsidiaries).
The obligations of Borrower under this Paragraph 8.02 shall survive the payment
and performance of the Obligations and the termination of this Agreement.
8.03. Indemnification. To the fullest extent permitted by law, Borrower
agrees to protect, indemnify, defend and hold harmless Agents, the Bank Parties
and their Affiliates and their respective directors, officers, employees, agents
and advisors ("Indemnitees") from and against any and all liabilities, losses,
damages or expenses of any kind or nature and from any suits,
82
claims or demands (including in respect of or for reasonable attorney's fees and
other expenses) arising on account of or in connection with (a) any use by
Borrower of any proceeds of the Revolving Loans or any Letter of Credit, (b) any
violation or alleged violation of any Requirement of Law by Borrower or any of
its Affiliates, (c) any Default or Event of Default, (d) or any acquisition or
proposed acquisition by Borrower of the stock or assets (in whole or in part) of
any other Person or (e) the execution, delivery and performance of this
Agreement and the other Credit Documents by any of the Indemnitees (unless
arising out of any violation by any of the Agents, the Bank Parties or any of
their Affiliates of any applicable law governing its banking powers), except to
the extent such liability arises from the willful misconduct or gross negligence
of such Indemnitee. Upon receiving knowledge of any suit, claim or demand
asserted by a third party that any Agent or any Bank Party believes is covered
by this indemnity, such Agent or such Bank Party shall give Borrower prompt
written notice of the matter (specifying with reasonable particularity the basis
therefor) and an opportunity (but not the obligation) to participate in and
defend it, at Borrower's sole cost and expense, with legal counsel reasonably
satisfactory to such Agent or such Bank Party, as the case may be. Any failure
or delay of any Agent or any Bank Party to notify Borrower of any such suit,
claim or demand as required by this Paragraph 8.03 or to cooperate in the
defense thereof shall not relieve Borrower of its obligations under this
Paragraph 8.03 but shall reduce such obligations to the extent of any increase
in those obligations caused solely by any such failure or delay which is
unreasonable. The obligations of Borrower under this Paragraph 8.03 shall
survive the payment and performance of the Obligations and the termination of
this Agreement.
8.04. Waivers; Amendments. Any term, covenant, agreement or condition
of this Agreement or any other Credit Document may be amended or waived if such
amendment or waiver is in writing and is signed by Borrower and the Majority
Banks; provided, however that:
(a) Any amendment, waiver or consent which (i) amends this
Paragraph 8.04, or (ii) amends the definition of Majority Banks must be
in writing and signed or approved in writing by all Banks;
(b) Any amendment, waiver or consent which (i) increases the
Total Commitment, (ii) extends the Maturity Date, (iii) reduces the
principal of or interest on the Revolving Loans or any fees or other
amounts payable for the account of the Banks hereunder, (iv) increases
the LC Commitment, or (v) postpones any date fixed for any payment of
the principal of or interest on the Revolving Loans or any fees or
other amounts payable for the account of the
83
Banks hereunder must be in writing and signed or approved in writing by
all Banks;
(c) Any amendment, waiver or consent which increases or
decreases the Proportionate Share of any Bank must be in writing and
signed by such Bank;
(d) Any amendment, waiver or consent which increases the LC
Commitment or otherwise affects the rights or obligations of Issuing
Bank must be in writing and signed by Issuing Bank; and
(e) Any amendment, waiver or consent which affects the rights
or obligations of any Agent must be in writing and signed by such
Agent.
No failure or delay by any Agent or any Bank Party in exercising any right
hereunder shall operate as a waiver thereof or of any other right nor shall any
single or partial exercise of any such right preclude any other further exercise
thereof or of any other right. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
specific instance and for the specific purpose for which given.
8.05. Successors and Assigns.
(a) Binding Effect. This Agreement and the other Credit
Documents shall be binding upon and inure to the benefit of Borrower,
the Bank Parties, Agents, all future holders of the Notes and their
respective successors and permitted assigns, except that Borrower may
not assign or transfer any of its rights or obligations under any
Credit Document without the prior written consent of Agents and each
Bank. All references in this Agreement to any Person shall be deemed to
include all successors and assigns of such Person.
(b) Participations. Any Bank may, in the ordinary course of
its commercial banking business and in accordance with applicable law,
at any time sell to one or more banks or other financial institutions
("Participants") participating interests in any Revolving Loan owing to
such Bank, any Note held by such Bank, any Commitment of such Bank or
any other interest of such Bank under this Agreement and the other
Credit Documents. In the event of any such sale by a Bank of
participating interests to a Participant, such Bank's obligations under
this Agreement to the other parties to this Agreement shall remain
unchanged, such Bank shall remain solely responsible for the
performance thereof, such Bank shall remain the holder of any such Note
for all purposes under this Agreement, such Bank shall retain the right
to approve amendments and waivers and other voting
84
rights hereunder and Agents and Borrower shall continue to deal solely
and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement; provided, however, that any agreement
pursuant to which any Bank sells a participating interest to a
Participant may require the selling Bank to obtain the consent of such
Participant in order for such Bank to agree in writing to any amendment
of a type specified in clause (i), (ii), (iii), (iv) or (v) of
Subparagraph 8.04(b) or Subparagraph 8.04(c), as appropriate. Borrower
agrees that if amounts outstanding under this Agreement and the other
Credit Documents are due and unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall, to the fullest extent permitted by
law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement and any
other Credit Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Bank under this
Agreement or any other Credit Documents; provided, however, that (i) no
Participant shall exercise any rights under this sentence without the
consent of Administrative Agent, (ii) no Participant shall have any
rights under this sentence which are greater than those of the selling
Bank and (iii) such rights of setoff shall be subject to the obligation
of such Participant to share with the Banks, and the Banks agree to
share with such Participant, as provided in Subparagraph 2.09(b).
Borrower also agrees that any Bank which has transferred all or part of
its interests in the Commitments and the Revolving Loans to one or more
Participants shall, notwithstanding any such transfer, be entitled to
the full benefits accorded such Bank under Paragraph 2.10, Paragraph
2.11, and Paragraph 2.12, as if such Bank had not made such transfer.
(c) Assignments. Any Bank may, in the ordinary course of its
commercial banking business and in accordance with applicable law, at
any time, sell and assign to any Bank, any affiliate of a Bank or any
other bank or financial institution (individually, an "Assignee Bank")
all or a portion of its rights and obligations under this Agreement and
the other Credit Documents (such a sale and assignment to be referred
to herein as an "Assignment") pursuant to an assignment agreement in
the form of Exhibit G (an "Assignment Agreement"), executed by each
Assignee Bank and such assignor Bank (an "Assignor Bank") and delivered
to Administrative Agent for its acceptance and recording in the
Register; provided, however, that:
(i) Without the written consent of Borrower (which
written consent of Borrower shall not be required after the
occurrence and during the
85
continuation of an Event of Default), Administrative Agent and
Issuing Bank (which consent of Borrower, Administrative Agent
and Issuing Bank shall not be unreasonably withheld), no Bank
may make any Assignment to any Assignee Bank which is not,
immediately prior to such Assignment, a Bank hereunder or an
affiliate which controls, is controlled by or is under common
control with a Bank hereunder;
(ii) Without the written consent of Borrower (which
written consent of Borrower shall not be required after the
occurrence and during the continuation of an Event of Default)
and Administrative Agent (which consent of Borrower may be
withheld in its sole and absolute discretion but which consent
of Administrative Agent shall not be unreasonably withheld),
no Bank may make any Assignment to any Assignee Bank which is
not, immediately prior to such Assignment, a Bank hereunder or
an affiliate which controls, is controlled by or is under
common control with a Bank hereunder if (A) the principal
amount of such Assignment is less than the lesser of two and
one-half percent (2.50%) of the Total Commitment at the time
of such Assignment or all of the Assignor Bank's Revolving
Loans and Commitments hereunder or (B) if, after giving effect
to such Assignment, the sum of the Assignor Bank's Commitment
would be greater than zero but less than two and one-half
percent (2.50%) of the Total Commitment at the time of such
Assignment;
(iii) Without the written consent of Borrower (which
written consent of Borrower shall not be required after the
occurrence and during the continuation of an Event of Default)
and Administrative Agent (which consent of Borrower and
Administrative Agent shall not be unreasonably withheld), no
Bank may make any Assignment to any Assignee Bank which is,
immediately prior to such Assignment, a Bank hereunder or an
affiliate which controls, is controlled by or is under common
control with a Bank hereunder if the principal amount of such
Assignment is less than the lesser of Five Million Dollars
($5,000,000) or all of the Assignor Bank's Revolving Loans and
Commitments hereunder; and
(iv) No Bank may make any Assignment which does not
assign and delegate an equal pro rata interest in such Bank's
Revolving Loans, Commitments and all other rights, duties and
obligations of such Bank under this Agreement and the other
Credit Documents.
86
Upon such execution, delivery, acceptance and recording of each
Assignment Agreement, from and after the Assignment Effective Date
determined pursuant to such Assignment Agreement, (A) each Assignee
Bank thereunder shall be a Bank hereunder with a Proportionate Share as
set forth on Attachment 1 to such Assignment Agreement and shall have
the rights, duties and obligations of such a Bank under this Agreement
and the other Credit Documents, and (B) the Assignor Bank thereunder
shall be a Bank with a Proportionate Share as set forth on Attachment 1
to such Assignment Agreement, or, if the Proportionate Share of the
Assignor Bank has been reduced to 0%, the Assignor Bank shall cease to
be a Bank; provided, however, that any such Assignor Bank which ceases
to be a Bank shall continue to be entitled to the benefits of any
provision of this Agreement which by its terms survives the termination
of this Agreement. Each Assignment Agreement shall be deemed to amend
Schedule I to the extent, and only to the extent, necessary to reflect
the addition of each Assignee Bank, the deletion of each Assignor Bank
which reduces its Proportionate Share to 0% and the resulting
adjustment of Proportionate Shares arising from the purchase by each
Assignee Bank of all or a portion of the rights and obligations of an
Assignor Bank under this Agreement and the other Credit Documents. On
or prior to the Assignment Effective Date determined pursuant to each
Assignment Agreement, Borrower, at its own expense, shall execute and
deliver to Administrative Agent, in exchange for the surrendered Note
of the Assignor Bank thereunder, a new Note to the order of each
Assignee Bank thereunder in an amount equal to the Commitment assumed
by such Assignee Bank and, if the Assignor Bank is continuing as a Bank
hereunder, a new Note to the order of the Assignor Bank in an amount
equal to the Commitment retained by it. Each such new Note shall be
dated the Closing Date and otherwise be in the form of the Note
replaced thereby (provided that Borrower shall not be obligated to pay
any additional interest to any Assignee Bank in respect to any
principal payments made prior to the Assignment Effective Date of the
Assignment to such Assignee Bank). The Notes surrendered by the
Assignor Bank shall be returned by Administrative Agent to Borrower
marked "replaced". Each Assignee Bank which was not previously a Bank
hereunder and which is not incorporated under the laws of the United
States of America or a state thereof shall, within three (3) Business
Days of becoming a Bank, deliver to Borrower and Administrative Agent
either two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 (or successor applicable form), as the case
may be, certifying in each case that such Bank is entitled to receive
payments under this Agreement without deduction or withholding of any
United States federal income taxes.
87
(d) Register. Administrative Agent shall maintain at its
address referred to in Paragraph 8.01 a copy of each Assignment
Agreement delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Banks and the
Proportionate Share of each Bank from time to time. The entries in the
Register shall be conclusive in the absence of manifest error, and
Borrower, Agents and the Bank Parties may treat each Person whose name
is recorded in the Register as the owner of the Revolving Loans
recorded therein for all purposes of this Agreement. The Register shall
be available for inspection by Borrower or any Bank Party at any
reasonable time and from time to time upon reasonable prior notice.
(e) Registration. Upon its receipt of an Assignment Agreement
executed by an Assignor Bank and an Assignee Bank (and, to the extent
required by Subparagraph 8.05(c), by Borrower, Administrative Agent and
Issuing Bank), together with payment to Administrative Agent by
Assignor Bank of a registration and processing fee of $3,500,
Administrative Agent shall (i) promptly accept such Assignment
Agreement and (ii) on the Assignment Effective Date determined pursuant
thereto record the information contained therein in the Register and
give notice of such acceptance and recordation to the Bank Parties and
Borrower. Administrative Agent may, from time to time at its election,
prepare and deliver to the Bank Parties and Borrower a revised Schedule
I reflecting the names, addresses and respective Proportionate Shares
of all Banks then parties hereto.
8.06. Setoff; Security Interest.
(a) Setoff. In addition to any rights and remedies of the Bank
Parties provided by law, each Bank Party shall have the right, with the
prior consent of Administrative Agent, but without prior notice to or
consent from Borrower, any such notice or consent being expressly
waived by Borrower to the extent permitted by applicable law, upon the
occurrence and during the continuance of an Event of Default, to
set-off and apply, or to authorize or direct such Bank to set-off and
apply, against any indebtedness, whether matured or unmatured, of
Borrower to such Bank Party, any amount owing from such Bank Party to
Borrower, at or at any time after, the happening of any of the above
mentioned events, and as security for such indebtedness, Borrower
hereby grants to Administrative Agent and each Bank Party a continuing
security interest in any and all deposits, accounts or moneys of
Borrower then or thereafter maintained with such Bank Party, subject in
each case to Subparagraph 2.09(b). The aforesaid right of set-off may
be exercised by any Bank Party against Borrower or against any trustee
in
88
bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver or execution, judgment or attachment creditor of
Borrower or against anyone else claiming through or against Borrower or
such trustee in bankruptcy, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or attachment
creditor, notwithstanding the fact that such right of set-off shall not
have been exercised by such Bank Party prior to the occurrence of an
Event of Default. Any Bank Party which exercises its right of setoff
agrees promptly to notify Borrower after any such set-off and
application made by such Bank Party, provided that the failure to give
such notice shall not affect the validity of such set-off and
application.
(b) Security Interest. As security for the Obligations,
Borrower hereby grants to each Bank Party, for the benefit of all
Agents and Bank Parties, a continuing security interest in any and all
deposit accounts or moneys of Borrower now or hereafter maintained with
such Bank Party. Each Bank Party shall have all of the rights of a
secured party with respect to such security interest.
8.07. No Third Party Rights. Nothing expressed in or to be implied from
this Agreement is intended to give, or shall be construed to give, any Person,
other than the parties hereto and their permitted successors and assigns
hereunder, any benefit or legal or equitable right, remedy or claim under or by
virtue of this Agreement or under or by virtue of any provision herein.
8.08. Partial Invalidity. If at any time any provision of this
Agreement is or becomes illegal, invalid or unenforceable in any respect under
the law or any jurisdiction, neither the legality, validity or enforceability of
the remaining provisions of this Agreement nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction shall
in any way be affected or impaired thereby.
8.09. Jury Trial. EACH OF BORROWER, THE BANK PARTIES AND AGENTS, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT.
8.10. Counterparts. This Agreement may be executed in any number of
identical counterparts, any set of which signed by all the parties hereto shall
be deemed to constitute a complete, executed original for all purposes.
8.11. Confidentiality. None of the Banks and Agents shall disclose to
any Person any information with respect to Borrower or any of its Subsidiaries
which is furnished pursuant
89
to this Agreement, except that any Bank or Agent may disclose any such
information (a) to its own directors, officers, employees, auditors, counsel and
other professional advisors and to its Affiliates if such Bank or Agent or such
Bank's or such Agent's holding or parent company in its sole discretion
determines that any such party should have access to such information; (b) to
another Bank or Agent; (c) if generally available to the public; (d) if required
or appropriate in any report, statement or testimony submitted to any
Governmental Authority having or claiming to have jurisdiction over such Bank or
Agent; (e) if required or appropriate in response to any summons or subpoena or
in connection with any litigation, to the extent permitted or deemed advisable
by counsel; (f) to comply with any Requirement of Law applicable to such Bank or
Agent; (g) to any Participant or Assignee Bank or any prospective Participant or
Assignee Bank, provided that such Participant or Assignee or prospective
Participant or Assignee agrees in writing to be bound by this Paragraph 8.11
prior to disclosure; or (h) otherwise with the prior consent of Borrower;
provided, however, that any disclosure made in violation of this Agreement shall
not affect the obligations of Borrower under this Agreement and the other Credit
Documents.
[The next page is the first signature page.]
90
IN WITNESS WHEREOF, Borrower, the Bank Parties and Agents have caused
this Agreement to be executed as of the day and year first above written.
BORROWER: QUANTUM CORPORATION
By: /s/ G. Xxxxxx XxXxxxxx
---------------------------------------
G. Xxxxxx XxXxxxxx
Vice President Finance
& Treasurer
CO-ARRANGERS: ABN AMRO BANK N.V., San Francisco
International Branch,
As a Co-Arranger
By: /s/ Xxxxx X. Xxx
---------------------------------------
Name: Xxxxx X. Xxx
Title: Group Vice President
By: /s/ Xxxxxxx X. XxXxxxx
---------------------------------------
Name: Xxxxxxx X. XxXxxxx
Title: Assistant Vice President
CIBC INC.,
As a Co-Arranger
By: /s/ Xxx X. Xxxxx
---------------------------------------
Name: Xxx X. Xxxxx
Title: AUTHORIZED SIGNATORY
91
ADMINISTRATIVE AGENT: CANADIAN IMPERIAL BANK OF COMMERCE,
As Administrative Agent
By: /s/ Xxx X. Xxxxx
---------------------------------------
Name: Xxx X. Xxxxx
Title: Authorized Signatory
BANKS: ABN AMRO BANK N.V., San Francisco
International Branch,
As a Bank
By: /s/ Xxxxx X. Xxx
---------------------------------------
Name: Xxxxx X. Xxx
Title: Group Vice President
By: /s/ Xxxxxxx X. XxXxxxx
---------------------------------------
Name: Xxxxxxx X. XxXxxxx
Title: Assistant Vice President
CIBC INC.,
As a Bank
By: /s/ Xxx X. Xxxxx
---------------------------------------
Name: Xxx X. Xxxxx
Title: AUTHORIZED SIGNATORY
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
As a Bank
By: /s/ Xxxxx XxXxxxx
---------------------------------------
Name: Xxxxx XxXxxxx
Title: Managing Director
92
BANKBOSTON, N.A.,
As a Bank
By: /s/ Xxx X. Xxxxxx
---------------------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
THE BANK OF NOVA SCOTIA,
As a Bank
By: /s/ Xxxxx Xxxxxxx
---------------------------------------
Name: Xxxxx Xxxxxxx
Title: Senior Relationship
Manager
FLEET NATIONAL BANK,
As a Bank
By: /s/ Xxxxxxx Xxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Vice President
THE INDUSTRIAL BANK OF JAPAN,
LIMITED,
As a Bank
By: /s/ Xxxxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Deputy General Manager
BANQUE NATIONALE DE PARIS,
As a Bank
By: /s/ Xxxxxxx X. Xx Xxxxxx
------------------------------------------------------
Name: Xxxxxx X. Xxxxxxxx Xxxxxxx X. Xx Xxxxxx
Title: Vice President Assistant Vice President
93
THE MITSUBISHI TRUST AND BANKING
CORPORATION, LOS ANGELES AGENCY
As a Bank
By: /s/ Yasushi Satomi
---------------------------------------
Name: Yasushi Satomi
Title: Senior Vice President
UNION BANK OF CALIFORNIA, N.A.,
As a Bank
By: /s/ Xxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Assistant Vice President
THE FUJI BANK, LIMITED,
As a Bank
By: /s/ Xxxxx Xxxxx
---------------------------------------
Name: Xxxxx Xxxxx
Title: General Manager
ROYAL BANK OF CANADA,
As a Bank
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Manager
DEUTSCHE BANK AG NEW YORK AND/OR
CAYMAN ISLAND BRANCHES,
As a Bank
By: /s/ Xxxx Xxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
94
KEYBANK NATIONAL ASSOCIATION
As a Bank
By: /s/ Xxxxx X. XxXxxxx
---------------------------------------
Name: Xxxxx X. XxXxxxx
Title: Vice President
THE LONG-TERM CREDIT BANK OF JAPAN,
LTD.,
As a Bank
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Deputy General Manager
MELLON BANK,
As a Bank
By: /s/ Xxxxx X. Xxxxx
---------------------------------------
Name: Xxxxx X. Xxxxx
Title: First Vice President
SANWA BANK CALIFORNIA,
As a Bank
By: /s/ Xxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
THE SUMITOMO TRUST AND BANKING CO.,
LTD., LOS ANGELES AGENCY
As a Bank
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President & Manager
95
BANQUE PARIBAS,
As a Bank
By: /s/ Xxxxx Xxxxx
---------------------------------------
Name: Xxxxx Xxxxx
Title: Assistant Vice President
By: /s/ Xxx X. Xxxxxxx
---------------------------------------
Name: Xxx X. Xxxxxxx
Title: Group Vice President
THE SUMITOMO BANK, LIMITED,
As a Bank
By: /s/ Xxxx Xxxxxx
---------------------------------------
Name: Xxxx Xxxxxx
Title: General Manager
96
SCHEDULE I
BANKS
PROPORTIONATE
BANK SHARE*
---- ------
ABN AMRO BANK N.V. 8.00000000%
Applicable Lending Office:
ABN AMRO Bank N.V.
San Francisco International
Branch
000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Address for Notices:
ABN AMRO Bank N.V.
San Francisco International Branch
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxxxx
Xxxxx X. Xxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
ABN AMRO Bank, N.V.
1235 Avenue of the Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx
Vice President, Syndications
Telephone: (000) 000-0000
Fax: (000) 000-0000 or 000-0000
Wiring Instructions:
ABN AMRO Bank N.V.
ABA No.: 000-000-000
Account No.: 651001054541
Account Name: ABN AMRO San
Francisco International Branch
Reference: Quantum Corp.
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-1
PROPORTIONATE
BANK SHARE*
---- ------
CIBC INC. 8.00000000%
Applicable Lending Office:
CIBC Inc.
Two Paces West
0000 Xxxxx Xxxxx Xxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Address for Notices:
CIBC Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000 or 3799
Wiring Instructions:
Xxxxxx Guaranty Trust Company of
Xxx Xxxx
Xxx Xxxx, XX 00000
ABA No.: 000-000-000
Account No.: 000-00-000
Account Name: CIBC, New York Agency
For further credit to: Agented Loans
Account No. 07-09611
Attention: Syndications
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-2
PROPORTIONATE
BANK SHARE*
---- ------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION 8.00000000%
Applicable Lending Office:
Bank of America National Trust
and Savings Association
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
GPO Account Admin: #5693
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
Bank of America National Trust
and Savings Association
Credit Products-High Technology-SF #3697
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx XxXxxxx
Managing Director
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Bank of America National Trust
and Savings Association
San Francisco, California
ABA No.: 000000000
Account No.: 1233183980
Reference: Quantum Corp.
Attention: Xxxxx Xxxxx
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-3
PROPORTIONATE
BANK SHARE*
---- ------
BANKBOSTON, N.A. 6.00000000%
Applicable Lending Office:
BankBoston, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Address for Notices:
BankBoston, N.A.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Attn: Xxx X. Xxxxxx, Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
ABA No.: 000-000-000
Account No.: 540-99647
Attn: Comm Loan Svc, Adm 50 High Tech
Ref: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-4
PROPORTIONATE
BANK SHARE*
---- ------
THE BANK OF NOVA SCOTIA 6.00000000%
Applicable Lending Office:
The Bank of Nova Scotia
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Mr. Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
The Bank of Nova Scotia
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
The Bank of Nova Scotia
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX
ABA No.: 000000000
Account No.: 60023-7
For Credit to: The Bank of Nova Scotia
San Francisco Agency
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-5
PROPORTIONATE
BANK SHARE*
---- ------
FLEET NATIONAL BANK 6.00000000%
Applicable Lending Office:
Fleet National Bank
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Address for Notices:
Fleet National Bank
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxxx
Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Fleet National Bank
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
ABA: 000-000-000
Account Name: Incoming Loan in Process Wire Account
A/C No.: 120986-03156
Reference: Quantum Corp.
Attention: Commercial Loan Operations/Agent Bank
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-6
PROPORTIONATE
BANK SHARE*
---- ------
THE INDUSTRIAL BANK OF
JAPAN, LIMITED 6.00000000%
Applicable Lending Office:
The Industrial Bank of Japan, Limited
San Francisco Agency
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Address for Notices:
The Industrial Bank of Japan, Limited
San Francisco Agency
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx X'Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Telex: 49608738
Answerback: IBJ SFO
Wiring Instructions:
Bank of American NT & SA
International Deposit Services 6561
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
ABA No.: 000-000-000
Account: The Industrial Bank of Japan, Limited
Los Angeles Agency
Account No.: 62906-14014
"For Credit to IBJ SFA, A/C 2601-22011"
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-7
PROPORTIONATE
BANK SHARE*
---- ------
BANQUE NATIONALE DE PARIS 5.00000000%
Applicable Lending Office:
Banque Nationale de Paris
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Telex: RCA 278900
Answerback: BNPS UR
Address for Notices:
Banque Nationale de Paris
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Credit:
Xxxxxx Xxxxxxxx
Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Operations:
Xxxxxx X. Xxxx
Treasurer
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Federal Reserve Bank of San Francisco
For the Account of: Banque Nationale de Paris
San Xxxxxxxxx Xxxxxx
ABA #: 000000000
Ref: QUANTUM REVOLVER
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-8
PROPORTIONATE
BANK SHARE*
---- ------
THE MITSUBISHI TRUST AND
BANKING CORPORATION, LOS ANGELES AGENCY 5.00000000%
Applicable Lending Office:
The Mitsubishi Trust and Banking Corporation, Los Angeles Agency
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000/ (000) 000-0000
Telex: 49657290
Answerback: MTB B LSA
Alternative Contact: Xxx Xxxxxxxxxx
Loan Assistant
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
The Mitsubishi Trust and Banking Corporation, Los Angeles Agency
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxx Xxxx
Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Alternative Contact: F. Xxxxx Xxxxxxx
First Vice President
Telephone: (000) 000-0000
Wiring Instructions:
Bank of America, San Francisco, California
ABA #: 121 000 358
Account #: 62908-04915
Ref: Quantum Corporation
Attention: Loan Administration Department
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-9
PROPORTIONATE
BANK SHARE*
---- ------
UNION BANK OF CALIFORNIA, N.A. 5.00000000%
Applicable Lending Office:
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Telex: 188316 UNION SFO UT
Answerback: UNION SFO UT
Address for Notices:
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Union Bank of California, 0000 Xxxxxx Xxxxxx, Xxxxxxxx, XX 00000
Los Angeles, CA
Fed ABA No.: 000-000-000
Account No.: 070196431
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-10
PROPORTIONATE
BANK SHARE*
---- ------
THE FUJI BANK, LIMITED 4.00000000%
Applicable Lending Office:
The Fuji Bank, Ltd.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Telex: 176087
Answerback: FUJIBK SFO
Address for Notices:
The Fuji Bank, Ltd.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Credit:
Attention: Mami Yamajo, Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Operations:
Attention: Xxxxx Eng
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Bank of America, NT&SA
San Francisco, CA
ABA #: 0000-0000-0
Account Name: The Fuji Bank, Limited, San Francisco
Account #: 62 901-08242
Ref: Quantum R/C
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-11
PROPORTIONATE
BANK SHARE*
---- ------
ROYAL BANK OF CANADA 4.00000000%
Applicable Lending Office:
Royal Bank of Canada
000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
Credit:
Royal Bank of Canada
000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Operations:
Royal Bank of Canada
0 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Telex: ROYBAN 65219
Wiring Instructions:
Chase Xxxxxxxxx Xxxx, Xxx Xxxx
Xxx Xxxx, XX
ABA #: 000000000
Account #: 000-0-000000
Attention: Xxxxx Xxxxx
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-12
PROPORTIONATE
BANK SHARE*
---- ------
DEUTSCHE BANK AG NEW YORK AND/OR 4.00000000%
CAYMAN ISLANDS BRANCHES
Applicable Lending Office:
Deutsche Bank AG
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Backup Operations: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
00 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Deutsche Bank AG New York Branch
ABA #: 000000000
Ref: Quantum Corporation
Attention: Xxxxx Xxxx
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-13
PROPORTIONATE
BANK SHARE*
---- ------
KEYBANK NATIONAL ASSOCIATION 4.00000000%
Applicable Lending Office:
KeyBank National Association
X.X. Xxx 0000
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx/Xxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx XxXxxxx/Xxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
KeyBank National Association
ABA #: 000000000
Account Name: NW Region Specialty Services
Account #: 00000000
Ref: Quantum
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-14
PROPORTIONATE
BANK SHARE*
---- ------
THE LONG-TERM CREDIT BANK
OF JAPAN, LTD. 4.00000000%
Applicable Lending Office:
The Long-Term Credit Bank of Japan, Ltd.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
The Long-Term Credit Bank of Japan, Ltd.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxx/Xxxxxx Xxxxxx
Telephone: (000) 000-0000/(000) 000-0000
Fax: (000) 000-0000
Telex: 673-3533
Answerback: LTCB LSA
Wiring Instructions:
First Interstate Bank of California
Los Angeles, CA
Fed ABA#: 122000358
For Credit to: Long-Term Credit Bank of Japan
Los Angeles Agency
Account No.: 6290131191
Attention: LA7
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-15
PROPORTIONATE
BANK SHARE*
---- ------
MELLON BANK 4.00000000%
Applicable Lending Office:
Mellon Bank
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxx
Telephone: (415) 326-3005 ext. 224
Fax: (000) 000-0000
Address for Notices:
Mellon Bank
Three Mellon Bank Center, 153-2304
Xxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Mellon Bank
Attention: Loan Administration
ABA #: 000000000
Account #: 000-000-000
Ref: Quantum Corporation
Attention: Loan Administration
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-16
PROPORTIONATE
BANK SHARE*
---- ------
SANWA BANK CALIFORNIA 4.00000000%
Applicable Lending Office:
Sanwa Bank California
San Xxxx Commercial Banking Center
000 Xxxxxxx Xxxxxxxxx
Xxx Xxxx, XX 00000
Address for Notices:
Sanwa Bank California
San Xxxx Commercial Banking Center
000 Xxxxxxx Xxxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Sanwa Bank California
ABA No.: 000000000
Account Name: San Xxxx CBC
Account No.: 1128-19005
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-17
PROPORTIONATE
BANK SHARE*
---- ------
THE SUMITOMO TRUST AND
BANKING CO., LTD. LOS ANGELES AGENCY 4.00000000%
Applicable Lending Office:
The Sumitomo Trust and Banking Co., Ltd., Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxx XxXxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
The Sumitomo Trust and Banking Co., Ltd.. Los Angeles Agency
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Manager, Credit Administration Department
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Bank of America NT & SA, San Francisco, California
ABA #: 000000000
Account Name: The Sumitomo Trust & Banking Co., Ltd., Los Angeles Agency
Account #: 62907-31117
Ref: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-18
PROPORTIONATE
BANK SHARE*
---- ------
BANQUE PARIBAS 3.00000000%
Applicable Lending Office:
Banque Paribas
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
Banque Paribas
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Letters of Credit:
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Revolver:
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
Bank of America, San Francisco CA
ABA #: 0000-0000-0
For credit to Banque Paribas, Los Angeles Agency
Account #: 62902-10150
Ref: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-19
PROPORTIONATE
BANK SHARE*
---- ------
THE SUMITOMO BANK, LIMITED 2.00000000%
Applicable Lending Office:
The Sumitomo Bank, Limited
San Francisco Agency
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Address for Notices:
The Sumitomo Bank, Limited
San Francisco Agency
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Wiring Instructions:
The Sumitomo Bank of California
ABA No.: 121 002 042
Account Name: The Sumitomo Bank, Ltd., San Xxxxxxxxx Xxxxxx
Reference: Quantum Corporation
* To be expressed as a percentage rounded to the eighth digit to the right of
the decimal point.
I-20
SCHEDULE II
PRICING GRID
XXXXX 0 XXXXX 0 XXXXX 0 XXXXX 0 XXXXX 5
PERIOD PERIOD PERIOD PERIOD PERIOD
------- ------- ------- ------- -------
APPLICABLE MARGINS
AND LC USAGE
FEE RATES: 0.40% 0.55% 0.70% 0.90% 1.10%
COMMITMENT FEE
PERCENTAGES: .150% .200% .250% .300% .375%
EXPLANATION
1. The Applicable Margin for each LIBOR Loan, the LC Usage Fee Rate on
each Letter of Credit and the Commitment Fee Percentage will be set for
each Pricing Period and will vary depending upon whether such period is
a Level 1 Period, a Level 2 Period, a Level 3 Period, a Level 4 Period
or a Level 5 Period.
2. The first Pricing Period, which commences on the date of this Agreement
and ends on September 30, 1997, will be a Xxxxx 0 Period.
3. The second Pricing Period, which commences on October 1, 1997 and ends
on November 30, 1997, will be a Xxxxx 0 Xxxxxx, x Xxxxx 0 Xxxxxx, x
Xxxxx 0 Period, a Level 4 Period or a Level 5 Period depending upon
Borrower's Total Funded Debt Ratio (and, with respect to determining
pricing at Level 1 Pricing only, EBITDA) for the consecutive
four-fiscal quarter period ending on June 30, 1997.
4. Each Pricing Period thereafter will be a Xxxxx 0 Xxxxxx, x Xxxxx 0
Xxxxxx, x Xxxxx 0 Period, a Level 4 Period or a Level 5 Period
depending upon Borrower's Total Funded Debt Ratio (and, with respect to
determining pricing at Level 1 Pricing only, EBITDA) for the most
recent consecutive four-fiscal quarter period ending prior to the first
day of such Pricing Period as follows:
(a) If, during any Pricing Period (i) Borrower's Total Funded Debt
Ratio is 1.00 or less and (ii) Borrower's EBITDA for the
previous four quarters is $400,000,000 or more, Borrower's
pricing will be a Level 1 Period.
(b) If, during any Pricing Period, (i) Borrower's Total Funded
Debt Ratio is more than 1.00 but less than or equal to
II-1
1.50, or (ii) Borrower's Total Funded Debt Ratio is less than
or equal to 1.00 but Borrower's EBITDA for the previous four
quarters is less than $400,000,000, Borrower's pricing will be
a Level 2 Period.
(c) If, during any Pricing Period, Borrower's Total Funded Debt
Ratio is more than 1.50 but less than or equal to 2.00,
Borrower's pricing will be a Level 3 Period.
(d) If, during any Pricing Period, Borrower's Total Funded Debt
Ratio is more than 2.00 but less than or equal to 2.50,
Borrower's pricing will be a Level 4 Period.
(e) If, during any Pricing Period, Borrower's Total Funded Debt
Ratio is more than 2.50, Borrower's pricing will be a Level 5
Period.
5. Level 1 Period will also apply during any Pricing Period (other than
the first Pricing Period) in which Borrower's senior long term debt
rating from S&P or Xxxxx'x is equal to or better than either BBB- or
Baa3 or Borrower's subordinated debt rating from S&P or Xxxxx'x is
equal to or better than BB+ or Ba1.
II-2
SCHEDULE 3.01
INITIAL CONDITIONS PRECEDENT
A. Principal Credit Documents.
(1) The Credit Agreement, duly executed by Borrower, each Bank
and each Agent; and
(2) A Note payable to each Bank, each duly executed by
Borrower.
B. Borrower Corporate Documents.
(1) The Certificate of Incorporation of Borrower, certified as
of a recent date prior to the Closing Date by the Secretary of State of
Delaware;
(2) A Certificate of Good Standing for Borrower (or comparable
certificate), certified as of a recent date prior to the Closing Date
by the Secretary of State of Delaware;
(3) A certificate of the Secretary or an Assistant Secretary
of Borrower, dated the Closing Date, certifying (a) that attached
thereto is a true and correct copy of the Bylaws of Borrower as in
effect on the Closing Date; (b) that attached thereto are true and
correct copies of resolutions duly adopted by the Board of Directors of
Borrower and continuing in effect, which authorize the execution,
delivery and performance by Borrower of this Agreement and the other
Credit Documents executed or to be executed by Borrower and the
consummation of the transactions contemplated hereby and thereby; (c)
that there are no proceedings for the dissolution or liquidation of
Borrower; and (d) the incumbency, signatures and authority of the
officers of Borrower authorized to execute, deliver and perform this
Agreement, the other Credit Documents and all other documents,
instruments or agreements related thereto executed or to be executed by
Borrower and indicating each such officer which is an Executive Officer
or Authorized Financial Officer; and
(4) Certificates of Good Standing (or comparable certificate)
for Borrower, certified as of a recent date prior to the Closing Date
by the Secretaries of State (or comparable public official) of each
state in which Borrower is qualified to do business.
C. Financial Statements, Financial Condition, Etc.
3.01-1
(1) A copy of the unaudited balance sheet, statements of
income and cash flows of Borrower and its Subsidiaries for the fiscal
quarter ended March 31, 1997 and for the fiscal year to such date
(prepared on a consolidated basis);
(2) A copy of the audited consolidated Financial Statements of
Borrower for the fiscal year ended March 31, 1996, prepared by Ernst &
Young and a copy of the unqualified opinion delivered by such
accountants in connection with such Financial Statements;
(3) A copy of the 10-Q report filed by Borrower with the
Securities and Exchange Commission for the quarter ended December 29,
1996;
(4) A copy of the 10-K report filed by Borrower with the
Securities and Exchange Commission for the fiscal year ended March 31,
1996; and
(5) Such other financial, business and other information
regarding Borrower, or any of its Subsidiaries as any Co-Arranger may
reasonably request, including information as to possible contingent
liabilities, tax matters, environmental matters and obligations for
employee benefits and compensation.
D. Opinions. A favorable written opinion from Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx,
counsel for Borrower, dated the Closing Date, addressed to the Administrative
Agent for the benefit of the Agents and the Banks, covering such legal matters
as Agents may reasonably request and otherwise in form and substance
satisfactory to the Co-Arrangers.
E. Other Items.
(1) A duly completed and timely delivered Notice of Borrowing;
(2) The Disclosure Letter, duly executed by Borrower;
(3) A copy of the indenture (including, as applicable, the
form of debenture and the form of the note) and other documents,
agreements and instruments, related to the Convertible Subordinated
Debentures, together with all amendments and indentures supplemental
thereto through the Closing Date, certified by an Executive Officer of
Borrower;
(4) An organization chart for Borrower and its Subsidiaries,
setting forth the relationship among such Persons, certified by an
Executive Officer of Borrower;
3.01-2
(5) A certificate of an Executive Officer of Borrower,
addressed to Administrative Agent and dated the Closing Date,
certifying that:
(a) The representations and warranties set forth in
Paragraph 4.01 are true and correct in all material respects
as of such date (except for such representations and
warranties made as of a specified date, which shall be true as
of such date); and
(b) No Event of Default or Default has occurred and
is continuing as of such date;
(6) Evidence satisfactory to Administrative Agent that the
proceeds of the initial Loans to be made on the Closing Date will be
used to satisfy all outstanding indebtedness of Borrower under the
Prior Credit Agreement, that the obligations of Borrower under the
Prior Credit Agreement (other than inchoate indemnity obligations) have
been satisfied and that the Prior Credit Agreement is terminated;
(7) All fees and expenses payable to the Agents and the Banks
on or prior to the Closing Date (including all Origination Fees and all
fees payable to the Agents pursuant to the Agents' Fee Letters);
(8) All fees and expenses of Agents' counsels through the
Closing Date; and
(9) Such other evidence as any Agent or Bank Party may
reasonably request to establish the accuracy and completeness of the
representations and warranties and the compliance with the terms and
conditions contained in this Agreement and the other Credit Documents.
3.01-3
SCHEDULE 4.01(p)
See Disclosure Letter
4.01(p)-1
SCHEDULE 5.02(a)
See Disclosure Letter
5.02(a)-1
EXHIBIT A
NOTICE OF BORROWING
[Date]
Canadian Imperial Bank of Commerce,
as Administrative Agent
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx
Syndications
1. Reference is made to that certain Credit Agreement, dated as of June
6, 1997 (as amended from time to time, the "Credit Agreement"), among Quantum
Corporation ("Borrower"), the financial institutions listed in Schedule I to the
Credit Agreement (the "Banks"), ABN AMRO Bank N.V., San Francisco International
Branch ("ABN") and CIBC Inc., as co-arrangers for the Banks, Canadian Imperial
Bank of Commerce, as administrative agent for the Banks (in such capacity,
"Administrative Agent"), ABN, as syndication agent for the Banks, Bank of
America National Trust and Savings Association, as documentation agent for the
Banks, and certain co-agents listed therein. Unless otherwise indicated, all
terms defined in the Credit Agreement have the same respective meanings when
used herein.
2. Pursuant to Subparagraph 2.01(b) of the Credit Agreement, Borrower
irrevocably hereby requests a Borrowing upon the following terms:
(a) The principal amount of the requested Borrowing is to be
$__________;
(b) The requested Borrowing is to consist of ["Base Rate" or
"LIBOR"] Loans;
(c) If the requested Borrowing is to consist of LIBOR Loans,
the initial Interest Period for such Revolving Loans will be
[__________ month[s]]; and
(d) The date of the requested Borrowing is to be __________,
_____.
3. Borrower hereby certifies to the Agents and the Banks that, on the
date of this Notice of Borrowing and after giving effect to the requested
Borrowing:
A-1
(a) The representations and warranties of Borrower and its
Subsidiaries set forth in Paragraph 4.01 of the Credit Agreement and in
the other Credit Documents are true and correct in all material
respects as if made on such date (except for representations and
warranties expressly made as of a specified date, which are true as of
such date); and
(b) No Default or Event of Default has occurred and is
continuing or will result from the requested Borrowing.
4. Please disburse the proceeds of the requested Borrowing to
________________________________________________________________________________
______________________________________________________________.
IN WITNESS WHEREOF, Borrower has executed this Notice of Borrowing on
the date set forth above.
QUANTUM CORPORATION
By:___________________________
Name:_______________________
Title:______________________
A-2
EXHIBIT B
NOTICE OF CONVERSION
[Date]
Canadian Imperial Bank of Commerce,
as Administrative Agent
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx
Syndications
1. Reference is made to that certain Credit Agreement, dated as of June
6, 1997 (as amended from time to time, the "Credit Agreement"), among Quantum
Corporation ("Borrower"), the financial institutions listed in Schedule I to the
Credit Agreement (the "Banks"), ABN AMRO Bank N.V., San Francisco International
Branch ("ABN") and CIBC Inc., as co-arrangers for the Banks, Canadian Imperial
Bank of Commerce, as administrative agent for the Banks (in such capacity,
"Administrative Agent"), ABN, as syndication agent for the Banks, Bank of
America National Trust and Savings Association, as documentation agent for the
Banks, and certain co-agents listed therein. Unless otherwise indicated, all
terms defined in the Credit Agreement have the same respective meanings when
used herein.
2. Pursuant to Subparagraph 2.01(d) of the Credit Agreement, Borrower
hereby irrevocably requests to convert a Borrowing as follows:
(a) The Borrowing to be converted consists of ["Base Rate" or
"LIBOR"] Loans in the aggregate principal amount of $__________ which
were initially advanced to Borrower on ___________, ____;
(b) The Revolving Loans in the Borrowing are to be converted
into ["Base Rate" or "LIBOR"] Loans;
(c) If such Revolving Loans are to be converted into LIBOR
Loans, the initial Interest Period for such Revolving Loans commencing
upon conversion will be [__________ month[s]]; and
(d) The date of the requested conversion is to be ___________,
____;
3. Borrower hereby certifies to the Agents and the Banks that, on the
date of this Notice of Conversion, and after giving effect to the requested
conversion, no Default or Event of Default has occurred and is continuing or
will result from the requested conversion.
B-1
B-2
IN WITNESS WHEREOF, Borrower has executed this Notice of Conversion on
the date set forth above.
QUANTUM CORPORATION
By:___________________________
Name:_______________________
Title:______________________
B-3
EXHIBIT C
NOTICE OF INTEREST PERIOD SELECTION
[Date]
Canadian Imperial Bank of Commerce,
as Administrative Agent
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx
Syndications
1. Reference is made to that certain Credit Agreement, dated as of June
6, 1997 (as amended from time to time, the "Credit Agreement"), among Quantum
Corporation ("Borrower"), the financial institutions listed in Schedule I to the
Credit Agreement (the "Banks"), ABN AMRO Bank N.V., San Francisco International
Branch ("ABN") and CIBC Inc., as co-arrangers for the Banks, Canadian Imperial
Bank of Commerce, as administrative agent for the Banks (in such capacity,
"Administrative Agent"), ABN, as syndication agent for the Banks, Bank of
America National Trust and Savings Association, as documentation agent for the
Banks, and certain co-agents listed therein. Unless otherwise indicated, all
terms defined in the Credit Agreement have the same respective meanings when
used herein.
2. Pursuant to Subparagraph 2.01(e) of the Credit Agreement, Borrower
hereby irrevocably selects a new Interest Period for a Revolving Loan as
follows:
(a) The Borrowing for which a new Interest Period is to be
selected consists of LIBOR Loans in the aggregate principal amount of
$__________ which were initially advanced to Borrower on _____________,
_____ ;
(b) The last day of the current Interest Period for such
Revolving Loans is ___________, ____; and
(c) The next Interest Period for such Revolving Loans
commencing upon the last day of the current Interest Period is to be
[_________ month[s]].
3. Borrower hereby certifies to the Agents and the Banks that, on the
date of this Notice of Interest Period Selection, and after giving effect to the
requested selection, no Default or Event of Default has occurred and is
continuing or will result from the requested selection.
C-1
IN WITNESS WHEREOF, Borrower has executed this Notice of Interest
Period Selection on the date set forth above.
QUANTUM CORPORATION
By:___________________________
Name:_______________________
Title:______________________
C-2
EXHIBIT D
REVOLVING LOAN NOTE
$_________________ ___________, _____
____________, 1997
FOR VALUE RECEIVED, QUANTUM CORPORATION, a Delaware corporation
("Borrower"), hereby promises to pay to the order of
________________________________________ ("Bank"), the principal sum of
______________________________ DOLLARS ($__________), or such lesser amount as
shall equal the aggregate outstanding principal balance of the Revolving Loans
made by Bank to Borrower pursuant to the Credit Agreement referred to below (as
amended from time to time, the "Credit Agreement"), on or before the Maturity
Date specified in the Credit Agreement, and to pay interest on said sum, or such
lesser amount, at the rates and on the dates provided in the Credit Agreement.
Borrower shall make all payments hereunder, for the account of Bank's
Applicable Lending Office, to Administrative Agent as indicated in the Credit
Agreement, in lawful money of the United States and in same day or immediately
available funds.
Borrower hereby authorizes Bank to record on the schedule(s) annexed to
this note the date and amount of each Revolving Loan and of each payment or
prepayment of principal made by Borrower and agrees that all such notations
shall constitute prima facie evidence of the matters noted; provided, however,
that the failure of Bank to make any such notation shall not affect Borrower's
obligations hereunder.
This note is one of the Notes referred to in the Credit Agreement,
dated as of June 6, 1997, among Borrower, Bank and the other financial
institutions from time to time parties thereto (collectively, the "Banks"), ABN
AMRO Bank N.V., San Francisco International Branch and CIBC Inc., as
co-arrangers for the Banks, and Canadian Imperial Bank of Commerce, as
administrative agent for the Banks. This note is subject to the terms of the
Credit Agreement, including the rights of prepayment and the rights of
acceleration of maturity set forth therein. The transfer, sale or assignment of
any rights under or interest in this note is subject to certain restrictions
contained in the Credit Agreement, including Paragraph 8.05 thereof. Terms used
herein have the meanings assigned to those terms in the Credit Agreement, unless
otherwise defined herein.
Borrower shall pay all reasonable fees and expenses payable to third
parties, including reasonable attorneys' fees, incurred by Bank in the
enforcement or attempt to enforce any of Borrower's obligations hereunder not
performed when due. Borrower hereby waives notice of presentment, demand,
protest or notice of any
D-1
other kind. This note shall be governed by and construed in accordance with the
laws of the State of California.
QUANTUM CORPORATION
By:___________________________
Name:______________________
Title:_____________________
D-2
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of Unpaid
Type of Amount of Interest Principal Paid Principal Notation
Date Loan Loan Period or Prepaid Balance Made By
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D-3
EXHIBIT E
COMPLIANCE CERTIFICATE
[Date]
Canadian Imperial Bank of Commerce,
as Administrative Agent
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx
Syndications
1. Reference is made to that certain Credit Agreement, dated as of June
6, 1997 (as amended from time to time, the "Credit Agreement"), among Quantum
Corporation ("Borrower"), the financial institutions listed in Schedule I to the
Credit Agreement (the "Banks"), ABN AMRO Bank N.V., San Francisco International
Branch ("ABN") and CIBC Inc., as co-arrangers for the Banks, Canadian Imperial
Bank of Commerce, as administrative agent for the Banks (in such capacity,
"Administrative Agent"), ABN, as syndication agent for the Banks, Bank of
America National Trust and Savings Association, as documentation agent for the
Banks, and certain co-agents listed therein. Unless otherwise indicated, all
terms defined in the Credit Agreement have the same respective meanings when
used herein (including Attachment 1 hereto).
2. Borrower hereby certifies to the Agents and the Banks as follows:
(a) In connection with the preparation of the Financial
Statements of Borrower for the [quarter][year] ended __________, ____
(the "Financial Statements"), the undersigned Executive Officer of
Borrower (the "Undersigned") has reviewed the terms of the Credit
Agreement and has made, or caused to be made, a detailed review of the
transactions and financial condition of Borrower and its Subsidiaries
during the accounting period covered by the Financial Statements.
(b) The Undersigned did not discover during the course of such
reviews, and has no other knowledge of, any event or condition which
constitutes a Default or an Event of Default at the end of the
accounting period covered by the Financial Statements or as of the date
of this Compliance Certificate, except as follows:
[State "None" or describe in detail any event or
condition which constitutes a Default or an Event of
Default, including the period during which any such
event or condition has existed, and the action which
Borrower proposes to take in connection therewith.]
E-1
(c) Set forth in Attachment 1 hereto are true, complete and
accurate computations used in determining compliance with various
covenants set forth in the Credit Agreement for the period covered by
the Financial Statements and as of the last day of such period.
IN WITNESS WHEREOF, Borrower has executed this Compliance Certificate
on the date set forth above.
QUANTUM CORPORATION
By:___________________________
Name:______________________
Title:_____________________
E-2
EXHIBIT F
SUBORDINATED DEBT TERMS
Section [_].1 Agreement of Subordination. [Quantum Corporation]
covenants and agrees, and each holder of Notes issued hereunder by his
acceptance thereof likewise covenants and agrees, that all Notes shall be issued
subject to the provisions of this Article [__]; and each Person holding any
Note, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and interest on all
Notes (including, but not limited to, the redemption price with respect to the
Notes called for redemption in accordance with Section [_] [Notice of
Redemption: Selection of Notes] or submitted for redemption in accordance with
Section [_] [Redemption at Option of Holders], as the case may be, as provided
in the Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full of all Senior Indebtedness, whether outstanding at the
date of this Indenture or thereafter incurred.
No provision of this Article [_] shall prevent the occurrence of any
default or Event of Default hereunder.
Section [_].2 Payments to Noteholders. No payment shall be made with
respect to the principal of, or premium, if any, or interest on the Notes
(including, but not limited to, the redemption price with respect to the Notes
to be called for redemption in accordance with Section [_] [Notice of
Redemption: Selection of Notes] or submitted for redemption in accordance with
Section [_] [Redemption at Option of Holders], as the case may be, as provided
in the Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section [_].5, if:
(i) a default in the payment of principal, premium, interest, rent
or other obligations due on any Senior Indebtedness occurs and
is continuing (or, in the case of Senior Indebtedness for
which there is a period of grace, in the event of such a
default that continues beyond the period of grace, if any,
specified in the instrument or lease evidencing such Senior
Indebtedness), unless and until such default shall have been
cured or waived or shall have ceased to exist; or
(ii) a default, other than a payment default, on a Designated
Senior Indebtedness occurs and is continuing that then permits
holders of such Designated Senior Indebtedness to accelerate
its maturity and the Trustee receives a notice of the default
(a "Payment Blockage Notice") from a Representative or
[Quantum Corporation].
F-1
If the Trustee receives any Payment Blockage Notice pursuant to clause
(ii) above, no subsequent Payment Blockage Notice shall be effective for
purposes of this Section [_].2 unless and until (A) at least 365 days shall have
elapsed since the initial effectiveness of the immediately prior Payment
Blockage Notice, and (B) all scheduled payments of principal, premium, if any,
and interest on the Notes that have come due have been paid in full in cash. No
nonpayment default that existed or was continuing on the date of delivery of any
Payment Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice.
[Quantum Corporation] may and shall resume payments on and
distributions in respect of the Notes upon the earlier of:
(1) the date upon which the default is cured or waived or ceases to
exist, or
(2) in the case of a default referred to in clause (ii) above, 179 days
pass after notice is received if the maturity of such Designated Senior
Indebtedness has not been accelerated,
unless this Article [_] otherwise prohibits the payment or distribution at the
time of such payment or distribution.
Upon any payment by [Quantum Corporation], or distribution of assets of
[Quantum Corporation] of any kind or character, whether in cash, property or
securities, to creditors upon any dissolution or winding-up or liquidation or
reorganization of [Quantum Corporation], whether voluntary or involuntary or in
bankruptcy, insolvency, receivership or other proceedings, all amounts due or to
become due upon all Senior Indebtedness shall first be paid in full in cash or
other payment satisfactory to the holders of such Senior Indebtedness, or
payment thereof in accordance with its terms provided for in cash or other
payment satisfactory to the holders of such Senior Indebtedness before any
payment is made on account of the principal of, premium, if any, or interest on
the Notes (except payments made pursuant to Article [_] [Trustee Provisions]
from monies deposited with the Trustee pursuant thereto prior to commencement of
proceedings for such dissolution, winding-up, liquidation or reorganization);
and upon any such dissolution or winding-up or liquidation or reorganization of
[Quantum Corporation] or bankruptcy, insolvency, receivership or other
proceeding, any payment by [Quantum Corporation], or distribution of assets of
[Quantum Corporation] of any kind or character, whether in cash, property or
securities, to which the holders of the Notes or the Trustee would be entitled,
except for the provision of this Article [_], shall (except as aforesaid) be
paid by [Quantum Corporation] or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the holders of the Notes or by the Trustee under this Indenture if
received by them or it, directly to the holders of Senior Indebtedness (pro rata
to such holders on the basis of the respective amounts of Senior Indebtedness
held by such
F-2
holders, or as otherwise required by law or a court order) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full, in cash or other payment
satisfactory to the holders of such Senior Indebtedness, after giving effect to
any concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the holders of the
Notes or to the Trustee.
For purposes of this Article [_], the words, "cash, property or
securities" shall not be deemed to include shares of stock of [Quantum
Corporation] as reorganized or readjusted, or securities of [Quantum
Corporation] or any other corporation provided for by a plan of reorganization
or readjustment, the payment of which is subordinated at least to the extent
provided in this Article [_] with respect to the Notes to the payment of all
Senior Indebtedness which may at the time be outstanding; provided that (i) the
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any reorganization or readjustment, and (ii) the rights of the holders of Senior
Indebtedness (other than leases which are not assumed by [Quantum Corporation]
or the new corporation, as the case may be) are not, without the consent of such
holders, altered by such reorganization or readjustment. The consolidation of
[Quantum Corporation] with, or the merger of [Quantum Corporation] into, another
corporation or the liquidation or dissolution of [Quantum Corporation] following
the conveyance or transfer of its property as an entirety, or substantially as
an entirety, to another corporation upon the terms and conditions provided for
in Article [_] [Consolidation, Merger, Sale, Conveyance and Lease] shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section [_].2 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article [_] [Consolidation, Merger, Sale, Conveyance and Lease].
In the event of the acceleration of the Notes because of an Event of
Default, no payment or distribution shall be made to the Trustee or any holder
of Notes in respect of the principal of, premium, if any, or interest on the
Notes (including, but not limited to, the redemption price with respect to the
Notes called for redemption in accordance with Section [_] [Notice of
Redemption; Selection of Notes] or submitted for redemption in accordance with
Section [__] [Redemption at Option of Holders], as the case may be, as provided
in the Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section [_].5, until all Senior
Indebtedness has been paid in full in cash or other payment satisfactory to the
holders of Senior Indebtedness or such acceleration is rescinded in accordance
with the terms of this Indenture. If payment of the Notes is accelerated because
of an Event of Default, [Quantum Corporation] shall promptly notify holders of
Senior Indebtedness of the acceleration.
F-3
In the event that, notwithstanding the foregoing provisions, any
payment or distribution of assets of [Quantum Corporation] of any kind or
character, whether in cash, property or securities (including, without
limitation, by way of setoff or otherwise), prohibited by the foregoing, shall
be received by the Trustee or the holders of the Notes before all Senior
Indebtedness is paid in full in cash or other payment satisfactory to the
holders of such Senior Indebtedness, or provision is made for such payment
thereof in accordance with its terms in cash or other payment satisfactory to
the holders of such Senior Indebtedness, such payment or distribution shall be
held in trust for the benefit of and shall be paid over or delivered to the
holders of Senior Indebtedness or their representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, as calculated by [Quantum Corporation], for application to
the payment of all Senior Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness in full in cash or other payment satisfactory to
the holders of such Senior Indebtedness, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior Indebtedness.
Nothing in this Section [_].2 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section [__][Compensation and Expenses of
Trustee]. This Section [_].2 shall be subject to the further provisions of
Section [_].5.
Section [_].3 Subrogation of Notes. Subject to the payment in full of
all Senior Indebtedness, the rights of the holders of the Notes shall be
subrogated to the extent of the payments or distributions made to the holders of
such Senior Indebtedness pursuant to the provisions of this Article [_](equally
and ratably with the holders of all indebtedness of [Quantum Corporation] which
by its express terms is subordinated to other indebtedness of [Quantum
Corporation] to substantially the same extent as the Notes are subordinated and
is entitled to like rights of subrogation) to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or
securities of [Quantum Corporation] applicable to the Senior Indebtedness until
the principal, premium, if any, and interest on the Notes shall be paid in full;
and, for the purposes of such subrogation, no payments or distributions to the
holders of the Senior Indebtedness of any cash, property or securities to which
the holders of the Notes or the Trustee would be entitled except for the
provisions of this Article [_] and no payment over pursuant to the provisions of
this Article [_] to or for the benefit of the holders of Senior Indebtedness by
holders of the Notes or the Trustee, shall, as between [Quantum Corporation],
its creditors other than holders of Senior Indebtedness, and the holders of the
Notes, be deemed to be a payment by [Quantum Corporation] to or on account of
the Senior Indebtedness; and no payments or distributions of cash, property or
securities to or for the benefit of the holders of the Notes
F-4
pursuant to the subrogation provisions of this Article [_], which would
otherwise have been paid to the holders of Senior Indebtedness shall be deemed
to be a payment by [Quantum Corporation] to or for the account of the Notes. It
is understood that the provisions of this Article [_] are and are intended
solely for the purposes of defining the relative rights of the holders of the
Notes, on the one hand, and the holders of the Senior Indebtedness, on the other
hand.
Nothing contained in this Article [_] or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among [Quantum Corporation], its
creditors other than the holders of Senior Indebtedness, and the holders of the
Notes, the obligation of [Quantum Corporation], which is absolute and
unconditional, to pay to the holders of the Notes the principal of (and premium,
if any) and interest on the Notes as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the holders of the Notes and creditors of [Quantum
Corporation] other than the holders of the Senior Indebtedness, nor shall
anything herein or therein prevent the Trustee or the holder of any Note from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article [_] of the
holders of Senior Indebtedness in respect of cash, property or securities of
[Quantum Corporation] received upon the exercise of any such remedy.
Upon any payment or distribution of assets of [Quantum Corporation]
referred to in this Article [_], the Trustee, subject to the provisions of
Section [_] [Duties and Responsibilities of Trustee], and the holders of the
Notes shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which such bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or a certificate of the
receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, delivered to the Trustee or to the holders
of the Notes, for the purpose of ascertaining the persons entitled to
participate in such distribution, the holders of the Senior Indebtedness and
other indebtedness of [Quantum Corporation], the amount thereof or payable
thereon and all other facts pertinent thereto or to this Article [_].
Section [_].4 Authorization to Effect Subordination. Each holder of a
Note by the holder's acceptance thereof authorizes and directs the Trustee on
the holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article [_] and appoints the
Trustee to act as the holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any proceeding referred to in the third paragraph of Section
[_] [Payments of Notes on Default; Suit Therefor] hereof at least 30 days before
the expiration of the time to file such claim, the holders of any Senior
Indebtedness or their
F-5
representatives are hereby authorized to file an appropriate claim for and on
behalf of the holders of the Notes.
Section [_].5 Notice to Trustee. [Quantum Corporation] shall give
prompt written notice in the form of an Officers' Certificate to a Responsible
Officer of the Trustee and to any paying agent of any fact known to [Quantum
Corporation] which would prohibit the making of any payment of monies to or by
the Trustee or any paying agent in respect of the Notes pursuant to the
provisions of this Article [_]. Notwithstanding the provisions of this Article
[_] or any other provision of this Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts which would prohibit the making of
any payment of monies to or by the Trustee in respect of the Notes pursuant to
the provisions of this Article [_], unless and until a Responsible Officer of
the Trustee shall have received written notice thereof at the Corporate Trust
Office from [Quantum Corporation] (in the form of an Officers' Certificate) or a
Representative or a holder or holders of Senior Indebtedness or from any trustee
thereof; and before the receipt of any such written notice, the Trustee, subject
to the provisions of Section [_] [Duties and Responsibilities of Trustee], shall
be entitled in all respects to assume that no such facts exist; provided that if
on a date not fewer than one Business Day prior to the date upon which by the
terms hereof any such monies may become payable for any purpose (including,
without limitation, the payment of the principal of, or premium, if any, or
interest on any Note) the Trustee shall not have received, with respect to such
monies, the notice provided for in this Section [_].5, then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such monies and to apply the same to the purpose for which
they were received, and shall not be affected by any notice to the contrary
which may be received by it on or after such prior date.
Notwithstanding anything in this Article [_] to the contrary, nothing
shall prevent any payment by the Trustee to the Noteholders of monies deposited
with it pursuant to Section [_] [Discharge of Indenture], and any such payment
shall not be subject to the provisions of Section [_].1 or [_].2.
The Trustee, subject to the provisions of Section [_] [Duties and
Obligations of Trustee], shall be entitled to rely on the delivery to it of a
written notice by a Representative or a person representing himself to be a
holder of Senior Indebtedness (or a trustee on behalf of such holder) to
establish that such notice has been given by a Representative or a holder of
Senior Indebtedness or a trustee on behalf of any such holder or holders. In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article [_], the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such person, the extent to which such person is entitled to participate
in such
F-6
payment or distribution and any other facts pertinent to the rights of such
person under this Article [_], and if such evidence is not furnished the Trustee
may defer any payment to such person pending judicial determination as to the
right of such person to receive such payment.
Section [_].6 Trustee's Relation to Senior Indebtedness. The Trustee in
its individual capacity shall be entitled to all the rights set forth in this
Article [_] in respect of any Senior Indebtedness at any time held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in Section
[_] [Limitations on Rights of Trustee as Creditor] or elsewhere in this
Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article [_], and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and, subject to the
provisions of Section [_] [Duties and Obligations of Trustee], the Trustee shall
not be liable to any holder of Senior Indebtedness if it shall pay over or
deliver to holders of Notes, [Quantum Corporation] or any other person money or
assets to which any holder of Senior Indebtedness shall be entitled by virtue of
this Article [_] or otherwise.
Section [_].7 No Impairment of Subordination. No right of any present
or future holder of any Senior Indebtedness to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of [Quantum Corporation] or by any act or failure to
act, in good faith, by any such holder, or by any noncompliance by [Quantum
Corporation] with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with.
Section [_].8 Certain Conversions Deemed Payment. For the purposes of
this Article [_] only, (1) the issuance and delivery of junior securities upon
conversion of Notes in accordance with Article [_] [Conversion of Notes] shall
not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Notes or on account of the
purchase or other acquisition of Notes, and (2) the payment, issuance or
delivery of cash (except in satisfaction of fractional shares pursuant to
Section 15.[_] [Cash Payment in Lieu of Fractional Shares]), property or
securities (other than junior securities) upon conversion of a Note shall be
deemed to constitute payment on account of the principal of such Note. For the
purposes of this Section [_].8, the term "junior securities" means (a) shares of
any stock of any class of [Quantum Corporation], or (b) securities of [Quantum
Corporation] which are subordinated in right of payment to
F-7
all Senior Indebtedness which may be outstanding at the time of issuance or
delivery of such securities to substantially the same extent as, or to a greater
extent than, the Notes are so subordinated as provided in this Article [_].
Nothing contained in this Article [_] or elsewhere in this Indenture or in the
Notes is intended to or shall impair, as among [Quantum Corporation], its
creditors other than holders of Senior Indebtedness and the Noteholders, the
right, which is absolute and unconditional, of the Holder of any Note to convert
such Note in accordance with Article [_] [Conversion of Notes].
Section [_].9 Article Applicable to Paying Agents. If at any time any
paying agent other than the Trustee shall have been appointed by [Quantum
Corporation] and be then acting hereunder, the term "Trustee" as used in this
Article [_] shall (unless the context otherwise requires) be construed as
extending to and including such paying agent within its meaning as fully for all
intents and purposes as if such paying agent were named in this Article [_] in
addition to or in place of the Trustee; provided, however, that the first
paragraph of Section [_].5 shall not apply to [Quantum Corporation] or any
Affiliate of [Quantum Corporation] if it or such Affiliate acts as paying agent.
Section [_].10 Senior Indebtedness Entitled to Rely. The holders of
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article [_], and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing thereto.
Definitions:
Designated Senior Indebtedness: The term "Designated Senior
Indebtedness" means the Sumitomo Credit Agreement and any particular Senior
Indebtedness in which the instrument creating or evidencing the same or the
assumption or guarantee thereof (or related agreements or documents to which
[Quantum Corporation] is a party) expressly provides that such Indebtedness
shall be "Designated Senior Indebtedness" for purposes of the Indenture
(provided that such instrument, agreement or other document may place
limitations and conditions on the right of such Senior Indebtedness to exercise
the rights of Designated Senior Indebtedness). If any payment made to any holder
of any Designated Senior Indebtedness or its Representative with respect to such
Designated Senior Indebtedness is rescinded or must otherwise be returned by
such holder or Representative upon the insolvency, bankruptcy or reorganization
of [Quantum Corporation] or otherwise, the reinstated Indebtedness of [Quantum
Corporation] arising as a result of such rescission or return shall constitute
Designated Senior Indebtedness effective as of the date of such rescission or
return.
Senior Indebtedness: The term "Senior Indebtedness" means the principal
of, premium, if any, interest (including all interest
F-8
accruing subsequent to the commencement of any bankruptcy or similar proceeding,
whether or not a claim for post-petition interest is allowable as a claim in any
such proceeding) and rent payable on or in connection with, and all fees, costs,
expenses and other amounts accrued or due on or in connection with, Indebtedness
of [Quantum Corporation], whether outstanding on the date of this Indenture or
thereafter created, incurred, assumed, guaranteed or in effect guaranteed by
[Quantum Corporation] (including all deferrals, renewals, extensions or
refundings of, or amendments, modifications or supplements to, the foregoing),
unless in the case of any particular Indebtedness the instrument creating or
evidencing the same or the assumption or guarantee thereof expressly provides
that such Indebtedness shall not be senior in right of payment to the Notes or
expressly provides that such Indebtedness is "pari passu" or "junior" to the
Notes. Notwithstanding the foregoing, the term Senior Indebtedness shall not
include any Indebtedness of [Quantum Corporation] to any subsidiary of [Quantum
Corporation], a majority of the voting stock of which is owned, directly or
indirectly, by [Quantum Corporation] or [Quantum Corporation]'s 5% Convertible
Subordinated Debentures due April 1, 2002. If any payment made to any holder of
any Senior Indebtedness or its Representative with respect to such Senior
Indebtedness is rescinded or must otherwise be returned by such holder or
Representative upon the insolvency, bankruptcy or reorganization of [Quantum
Corporation] or otherwise, the reinstated Indebtedness of [Quantum Corporation]
arising as a result of such rescission or return shall constitute Senior
Indebtedness effective as of the date of such rescission or return.
Sumitomo Credit Agreement: The term "Sumitomo Credit Agreement" means
that certain Credit Agreement, dated as of September 22, 1995 by and among
[Quantum Corporation], the several financial institutions listed on the
signature pages thereto (collectively, the "Banks"), and The Sumitomo Bank,
Limited, acting through its San Xxxxxxxxx Xxxxxx, as agent for the Banks (the
"Agent") and as Issuer, as amended, amended and restated, supplemented or
otherwise modified from time to time.
F-9
EXHIBIT G
ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT, dated as of the date set forth at the top of
Attachment 1 hereto, is by and among:
(1) The bank designated under item A of Attachment 1 hereto as
the Assignor Bank ("Assignor Bank"); and
(2) Each bank designated under item B of Attachment 1 hereto
as an Assignee Bank (individually, an "Assignee Bank").
RECITALS
A. Assignor Bank is one of the banks which is a party to the Credit
Agreement dated as of June 6, 1997, by and among Quantum Corporation, a Delaware
corporation ("Borrower"), Assignor Bank and the other financial institutions
parties thereto (collectively, the "Banks"), ABN AMRO Bank N.V., San Francisco
International Branch ("ABN") and CIBC Inc., as co-arrangers for the Banks,
Canadian Imperial Bank of Commerce, as administrative agent for the Banks (in
such capacity, "Administrative Agent"), ABN, as syndication agent for the Banks,
Bank of America National Trust and Savings Association, as documentation agent
for the Banks, and certain co-agents listed therein. (Such Credit Agreement, as
amended, supplemented or otherwise modified in accordance with its terms from
time to time to be referred to herein as the "Credit Agreement").
B. Assignor Bank wishes to sell, and Assignee Bank wishes to purchase,
a portion of Assignor Bank's rights under the Credit Agreement pursuant to
Subparagraph 8.05(c) of the Credit Agreement.
AGREEMENT
Now, therefore, the parties hereto hereby agree as follows:
1. Definitions. Except as otherwise defined in this Assignment
Agreement, all capitalized terms used herein and defined in the Credit Agreement
have the respective meanings given to those terms in the Credit Agreement.
2. Sale and Assignment. Subject to the terms and conditions of this
Assignment Agreement, Assignor Bank hereby agrees to sell, assign and delegate
to each Assignee Bank and each Assignee Bank hereby agrees to purchase, accept
and assume an undivided interest in and share of Assignor Bank's rights,
obligations and duties under the Credit Agreement and the other Credit Documents
equal to the Proportionate Share set forth under the caption "Proportionate
Share" opposite such Assignee Bank's name on Attachment 1 hereto.
G-1
3. Assignment Effective Upon Notice. Upon (a) receipt by Administrative
Agent of five (5) counterparts of this Assignment Agreement (to each of which is
attached a fully completed Attachment 1), each of which has been executed by
Assignor Bank and each Assignee Bank (and, if any Assignee Bank is not then a
Bank, by Borrower, Administrative Agent and Issuing Bank (if any)) and (b)
payment to Administrative Agent of the registration and processing fee specified
in Subparagraph 8.05(e) by Assignor Bank, Administrative Agent will transmit to
Borrower, Assignor Bank and each Assignee Bank an Assignment Effective Notice
substantially in the form of Attachment 2 hereto (an "Assignment Effective
Notice"). Such Assignment Effective Notice shall set forth the date on which the
assignment affected by this Assignment Agreement shall become effective (the
"Assignment Effective Date"), which date shall be the fifth Business Day
following the date of such Assignment Effective Notice.
4. Assignment Effective Date. At or before 12:00 noon (local time of
Assignor Bank) on the Assignment Effective Date, each Assignee Bank shall pay to
Assignor Bank, in immediately available or same day funds, an amount equal to
the purchase price, as agreed between Assignor Bank and such Assignee Bank (the
"Purchase Price"), for the Proportionate Share purchased by such Assignee Bank
hereunder. Effective upon receipt by Assignor Bank of the Purchase Price payable
by each Assignee Bank, the sale, assignment and delegation to such Assignee Bank
of such Proportionate Share as described in Paragraph 2 hereof shall become
effective.
5. Payments After the Assignment Effective Date. Assignor Bank and each
Assignee Bank hereby agree that Administrative Agent shall, and hereby authorize
and direct Administrative Agent to, allocate amounts payable under the Credit
Agreement and the other Credit Documents as provided in the Credit Agreement in
accordance with its appropriate Proportionate Share. Assignor Bank and each
Assignee Bank have made separate arrangements for (i) the payment by Assignor
Bank to such Assignee Bank of any principal, interest, fees or other amounts
previously received or otherwise payable to Assignor Bank hereunder if Assignor
Bank and such Assignee Bank have otherwise agreed that such Assignee Bank is
entitled to receive any such amounts and (ii) the payment by such Assignee Bank
to Assignor Bank of any principal, interest, fees or other amounts payable to
such Assignee Bank hereunder if Assignor Bank and such Assignee Bank have
otherwise agreed that Assignor Bank is entitled to receive any such amounts.
6. Delivery of Notes. On or prior to the Assignment Effective Date,
Assignor Bank will deliver to Administrative Agent the Note payable to Assignor
Bank. On or prior to the Assignment Effective Date, Borrower will deliver to
Administrative Agent a Note for each Assignee Bank and Assignor Bank, in each
case a in principal amount reflecting, in accordance with the Credit Agreement,
their respective Commitment (as adjusted pursuant to this Assignment Agreement).
As provided in Subparagraph 8.05(c) of
G-2
the Credit Agreement, each such new Note shall be dated the Closing Date and
otherwise be in the form of Note replaced thereby (provided that Borrower shall
not be obligated to pay any principal paid or interest accrued prior to the
effective date of this assignment to the Assignee Bank). Promptly after the
Assignment Effective Date, Administrative Agent will send to each of Assignor
Bank and the Assignee Banks its new Note and will send to Borrower the
superseded Note of Assignor Bank, marked "replaced."
7. Delivery of Copies of Credit Documents. Concurrently with the
execution and delivery hereof, Assignor Bank will provide to each Assignee Bank
(if it is not already a Bank party to the Credit Agreement) conformed copies of
all documents delivered to Assignor Bank on or prior to the Closing Date in
satisfaction of the conditions precedent set forth in the Credit Agreement.
8. Further Assurances. Each of the parties to this Assignment Agreement
agrees that at any time and from time to time upon the written request of any
other party, it will execute and deliver such further documents and do such
further acts and things as such other party may reasonably request in order to
effect the purposes of this Assignment Agreement.
9. Further Representations, Warranties and Covenants. Assignor Bank and
each Assignee Bank further represent and warrant to and covenant with each
other, Administrative Agent, the Co-Arrangers and the Banks as follows:
(a) Other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned hereby free
and clear of any adverse claim, Assignor Bank makes no representation
or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with
the Credit Agreement or the other Credit Documents or the execution,
legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or the other Credit Documents furnished.
(b) Assignor Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of
Borrower or any of its obligations under the Credit Agreement or any
other Credit Documents.
(c) Each Assignee Bank confirms that it has received a copy of
the Credit Agreement and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to
enter into this Assignment Agreement.
(d) Each Assignee Bank will, independently and without
reliance upon any Agent, Assignor Bank or any other Bank Party and
based upon such documents and information as it shall deem appropriate
at the time, continue to make its own credit
G-3
decisions in taking or not taking action under the Credit Agreement and
the other Credit Documents.
(e) Each Assignee Bank appoints and authorizes Agents to take
such action as Agents on its behalf and to exercise such powers under
the Credit Agreement and the other Credit Documents as are delegated to
Agents by the terms thereof, together with such powers as are
reasonably incidental thereto, all in accordance with Section VII of
the Credit Agreement.
(f) Each Assignee Bank agrees that it will perform in
accordance with their terms all of the obligations which by the terms
of the Credit Agreement and the other Credit Documents are required to
be performed by it as a Bank.
(g) Attachment 1 hereto sets forth the revised Proportionate
Share of Assignor Bank and each Assignee Bank as well as administrative
information with respect to each Assignee Bank.
10. Effect of this Assignment Agreement. On and after the Assignment
Effective Date, (a) each Assignee Bank shall be a Bank with a Proportionate
Share as set forth on Attachment 1 hereto and shall have the rights, duties and
obligations of such a Bank under the Credit Agreement and the other Credit
Documents and (b) Assignor Bank shall be a Bank with a Proportionate Share as
set forth on Attachment 1 hereto, or, if the Proportionate Share of Assignor
Bank has been reduced to 0%, Assignor Bank shall cease to be a Bank.
11. Miscellaneous. This Assignment Agreement shall be governed by, and
construed in accordance with, the laws of the State of California. Paragraph
headings in this Assignment Agreement are for convenience of reference only and
are not part of the substance hereof.
G-4
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement to be executed by their respective duly authorized officers as of the
date set forth in Attachment 1 hereto.
_____________________________,
as an Assignee Bank
By:___________________________
Name:______________________
Title:_____________________
_____________________________,
as an Assignee Bank
By:___________________________
Name:______________________
Title:_____________________
_____________________________,
as an Assignee Bank
By:___________________________
Name:______________________
Title:_____________________
_____________________________,
as an Assignee Bank
By:___________________________
Name:______________________
Title:_____________________
G-5
CONSENTED TO AND ACKNOWLEDGED BY:
QUANTUM CORPORATION
By:___________________________
Name:______________________
Title:_____________________
CANADIAN IMPERIAL BANK OF COMMERCE,
As Administrative Agent
By:___________________________
Name:______________________
Title:_____________________
ACCEPTED FOR RECORDATION
IN REGISTER:
CANADIAN IMPERIAL BANK OF COMMERCE,
As Administrative Agent
By:___________________________
Name:______________________
Title:_____________________
G-6
ATTACHMENT 1
TO ASSIGNMENT AGREEMENT
NAMES, ADDRESSES AND PROPORTIONATE SHARES
OF ASSIGNOR BANK AND ASSIGNEE BANKS AFTER ASSIGNMENT
--------------, ----
Proportionate
A. ASSIGNOR BANK Share*
------------------------------ -----%
Applicable Lending Office:
------------------------------
------------------------------
------------------------------
------------------------------
Address for notices:
------------------------------
------------------------------
------------------------------
------------------------------
Telephone No: __________
Facsimile No: __________
Wiring Instructions:
------------------------------
------------------------------
B. ASSIGNEE BANKS
------------------------------ -----%
Applicable Lending Office:
------------------------------
------------------------------
------------------------------
------------------------------
--------
* To be expressed by a percentage rounded to the eighth-digit to the right of
the decimal point.
G[1]-1
Proportionate
Share*
B. ASSIGNEE BANKS (cont'd)
Address for notices:
------------------------------
------------------------------
------------------------------
------------------------------
Telephone No: __________
Facsimile No: __________
Wiring Instructions:
------------------------------
------------------------------
------------------------------ -----%
Applicable Lending Office:
------------------------------
------------------------------
Address for notices:
------------------------------
------------------------------
------------------------------
------------------------------
Telephone No: __________
Facsimile No: __________
Wiring Instructions:
------------------------------
------------------------------
G[1]-2
ATTACHMENT 2
TO ASSIGNMENT AGREEMENT
FORM OF
ASSIGNMENT EFFECTIVE NOTICE
The undersigned, as administrative agent for the banks under the Credit
Agreement, dated as of June 6, 1997 (as amended from time to time) among Quantum
Corporation ("Borrower"), the financial institutions parties thereto (the
"Banks") ABN AMRO Bank N.V., San Francisco International Branch ("ABN") and CIBC
Inc., as co-arrangers for the Banks, Canadian Imperial Bank of Commerce, as
administrative agent for the Banks (in such capacity, "Administrative Agent"),
ABN, as syndication agent for the Banks, Bank of America National Trust and
Savings Association, as documentation agent for the Banks, and certain co-agents
listed therein, acknowledges receipt of five executed counterparts of a
completed Assignment Agreement, a copy of which is attached hereto. [Note:
Attach copy of Assignment Agreement.] Terms defined in such Assignment Agreement
are used herein as therein defined.
1. Pursuant to such Assignment Agreement, you are advised that the
Assignment Effective Date will be __________ [Insert fifth business day
following date of Assignment Effective Notice].
2. Pursuant to such Assignment Agreement, Assignor Bank is required to
deliver to Administrative Agent on or before the Assignment Effective Date the
Note payable to Assignor Bank.
3. Pursuant to such Assignment Agreement, Borrower is required to
deliver to Administrative Agent on or before the Assignment Effective Date the
following Notes, each dated _________________ [Insert appropriate date]:
[Describe each new Note for Assignor Bank and each Assignee Bank as to
principal amount.]
4. Pursuant to such Assignment Agreement, each Assignee Bank is
required to pay its Purchase Price to Assignor Bank at or before 12:00 Noon
(local time of Assignor Bank) on the Assignment Effective Date in immediately
available funds.
Very truly yours,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent
By:___________________________
Name:_________________________
Title:________________________
G[2]-1