1
10(LL)
Credit Agreement
dated as of June 1, 1999
between
State Auto Financial Corporation
and
State Automobile Mutual Insurance Company
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CREDIT AGREEMENT
CREDIT AGREEMENT dated as of June 1, 1999, between State Auto Financial
Corporation, a corporation duly organized and validly existing under the laws of
the State of Ohio (the "Company"); and State Automobile Mutual Insurance
Company, an Ohio corporation (the "Lender").
The Company has requested that the Lender make loans to it in an
aggregate principal amount not exceeding $30,000,000 and the Lender is prepared
to make such loans upon the terms and conditions hereof. In consideration of the
mutual covenants set forth herein and INTENDING TO BE LEGALLY BOUND HEREBY, the
Company and Lender hereby agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the following
terms shall have the following meanings (all terms defined in this Section 1.01
or in other provisions of this Agreement in the singular to have the same
meanings when used in the plural and vice versa):
"Borrowing Notice" shall mean a Borrowing Notice substantially
in the form of Exhibit B hereto as executed by an authorized officer of the
Company, whose names and signatures are included on Exhibit C, attached hereto
and incorporated herein.
"Business Day" shall mean any day (a) on which commercial
banks are not authorized or required to close in Columbus, OH.
"Commitment" shall mean, as to the Lender, the obligation of
the Lender to make Loans in an aggregate principal amount up to, but not
exceeding $30,000,000.
"Commitment Termination Date" shall mean December 31, 2000,
subject to extension as provided in Section 2.07 hereof.
"Credit Documents" shall mean, collectively, this Agreement
and the Notes.
"Default" shall mean an Event of Default or an event that with
notice or lapse of time or both would become an Event of Default.
"Event of Default" shall have the meaning assigned to such
term in Section 8 hereof.
"Existing Commitment Termination Date" shall have the meaning
assigned to such term in Section 2.07 hereof.
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect from time to time.
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"Lien" shall mean, with respect to any Property, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this Agreement and the other Credit Documents, a
Person shall be deemed to own subject to a Lien any Property that it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
(other than an operating lease) relating to such Property.
"Loans" shall mean the loans provided for in Section 2.01
hereof.
"Notes" shall mean the promissory notes provided for by
Section 2.05 hereof each in substantially the form as attached as Exhibit A.
"Person" shall mean any individual, corporation, company,
voluntary association partnership, limited liability company, joint venture,
trust, unincorporated organization or government (or any agency, instrumentality
or political subdivision thereof).
"Property" shall mean any right or interest in or to property
of any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
1.02 Accounting Terms and Determinations. Except as otherwise
expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders hereunder shall be
prepared, in accordance with GAAP. All calculations made for the purposes of
determining compliance with this Agreement shall (except as otherwise expressly
provided herein) be made by application of GAAP.
Section 2. Commitment, Loans, Notes and Prepayments.
2.01 Loans. The Lender agrees, on the terms and conditions of
this Agreement, to make one or more term loans to the Company in Dollars on or
before the Commitment Termination Date in an aggregate principal amount up to
but not exceeding $30,000,000. Loans paid or prepaid may not be re-borrowed.
2.02 Borrowings. The Company shall give the Lender notice of
each borrowing desired hereunder by delivering to the Lender a Borrowing Notice
in substantially the form attached as Exhibit B. Not later than 1:00 p.m.
Columbus, OH time on the date specified for each borrowing hereunder, the Lender
shall make available to the Company the amount of the Loan to be made by it on
such date at any account designated by the Company, in immediately available
funds.
2.03 Changes of Commitments. The Company shall have the right
at any time or from time to time to terminate or reduce the aggregate unused
amount of the Commitment; provided that (i) the Company shall give notice of
each such termination or reduction as provided in Section 4.03 hereof and (ii)
each partial reduction shall be in an aggregate amount at least equal to
$1,000,000 (or a larger integral multiple of $500,000).
2.04 Commitment Fee. The Company shall pay to the Lender a
commitment fee on the daily average unused amount of the Lender's Commitment,
for the period from and including the date hereof to but not including the
earlier of the date such Commitment is terminated and the Commitment Termination
Date, at a rate per annum equal to 1/4 of 1%.
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Accrued Commitment fee shall be payable on the first business day of each
calendar quarter (for the quarter then ended) and on the earlier of the date the
Commitment is terminated and the Commitment Termination Date.
2.05 Notes.
(a) Each Loan made by the Lender shall be evidenced by a
single promissory note of the Company substantially in the form of Exhibit A
hereto, dated the date such Loan is made, payable to such Lender in a principal
amount equal to the amount of such Loan and otherwise duly completed.
(b) The date, amount and interest rate of each Loan made by
the Lender to the Company, and each payment made on account of the principal
thereof, shall be recorded by the Lender on its books.
(c) The Lender shall not be entitled to have its Notes
substituted or exchanged for any reason, or subdivided for promissory notes of
lesser denominations, except in connection with a permitted assignment of all or
any portion of such Lender's Commitment, Loans and Notes pursuant to Section
9.05 hereof (and, if requested by the Lender, the Company agrees to so exchange
any Notes).
2.06 Optional Prepayments of Loans. Subject to Section 4.02
hereof, the Company shall have the right to prepay Loans at any time or from
time to time, provided that: (a) the Company shall give the Lender notice of
each such prepayment as provided in Section 4.03 hereof (and, upon the date
specified in any such notice of prepayment, the amount to be prepaid shall
become due and payable hereunder); (b) prepayments of the Loans shall be applied
to the installments of the Loans pro rata in accordance with the respective
principal amounts thereof outstanding on the date of such prepayment.
2.07 Extension of Commitment Termination Date.
(a) The Company may, by notice to the Lender given not less
than 120 days and not more than 180 days prior to the Commitment Termination
Date then in effect (the "Existing Commitment Termination Date"), request that
the Lenders extend the Commitment Termination Date for an additional 365 days
from the Existing Commitment Termination Date; provided that in no event may the
Company request more than three such extensions. The Lender, acting in its sole
discretion, shall, by notice (which shall be irrevocable) to the Company given
no earlier than the date that is 90 days prior to the Existing Commitment
Termination Date (herein, the "Consent Date") and no later than the date that is
three Business Days after the Consent Date, advise the Company whether or not
such Lender agrees to such extension. In the event the Lender does not agree to
the Extension, the Commitment terminates on the then current Commitment
Termination Date and no additional Loans shall be made under this Agreement.
(b) Notwithstanding the foregoing clause (a), the extension of
the Existing Commitment Termination Date shall not be effective with respect to
the Lender unless:
(i) no Default shall have occurred and be continuing
on each of the date of the notice requesting such extension
(the "Request Date"), the Consent Date and the Existing
Commitment Termination Date;
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(ii) each of the representations and warranties made
by the Company in Section 7 hereof shall be true and complete
on and as of each of the Request Date, the Consent Date and
the Existing Commitment Termination Date with the same force
and effect as if made on and as of such date (or, if any such
representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date);
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loans. The Company hereby promises to pay to
the Lender on demand, the principal of each Loan made and in any event, not
later than five years following the Commitment Termination Date as extended by
agreement of the parties.
3.02 Interest. The Company hereby promises to pay to the
Lender interest on the unpaid principal amount of each Loan made by such Lender
for the period from and including the date of such Loan to but excluding the
date such Loan shall be paid in full, at the following rates per annum:
(a) during the period from the date hereof to the original
Commitment Termination Date an interest rate equal to six percent (6%); and
(b) thereafter the interest rate applicable to any Loans shall
adjust at January 1 of each calendar year after December 31, 2000 to reflect a
substantially equivalent relationship of the current interest rate to the
current prime lending rate, subject to the material adverse changes as reflects
the Company's financial position.
(c) said interest payments shall be due no later than the
first Business Day of each calendar quarter during the term hereof, for the
quarter then ended.
Notwithstanding the foregoing, the Company hereby promises to
pay to the Lender for account of the Lender interest at the rate of the then
current interest rate times 1.5 on any principal of any Loan made by such Lender
and on any other amount payable by the Company hereunder or under the Notes held
by such Lender to or for account of such Lender that shall not be paid in full
when due (whether at stated maturity, by acceleration, or otherwise), for the
period from and including the due date thereof to but excluding the date the
same is paid in full.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
4.01 Payments.
(a) Except to the extent otherwise provided herein, all
payments of principal, interest and other amounts to be made by the Company
under this Agreement and the Notes, shall be made in U.S. Dollars, in
immediately available funds, without deduction, set-off or counterclaim, to the
Lender at an account designated by the Lender in writing to the Company, not
later than 1:00 p.m. Columbus, OH time on the date on which such payment shall
become due (each such payment made after such time on such due date to be deemed
to have been made on the next succeeding Business Day).
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(b) The Company shall, at the time of making each payment
under this Agreement or any Note for account of the Lender, specify to the
Lender the Loans or other amounts payable by the Company hereunder to which such
payment is to be applied.
(c) If the due date of any payment under this Agreement or any
Note would otherwise fall on a day that is not a Business Day, such date shall
be extended to the next succeeding Business Day, and interest shall be payable
for any principal so extended for the period of such extension.
4.02 Minimum Amounts. Each borrowing and partial prepayment of
principal of Loans shall be in an aggregate amount at least equal to $500,000 or
a larger integral multiple of $500,000.
4.03 Certain Notices. Notices by the Company to the Lender of
terminations or reductions of the Commitment and of borrowings and optional
prepayments of Loans shall be irrevocable and shall be effective only if
received by the Lender not later than 10:00 a.m. Columbus, OH time on the third
Business Day prior to the date of the relevant termination, reduction, borrowing
or prepayment. Each such notice of termination or reduction shall specify the
amount of the Commitment to be terminated or reduced. Each such notice of
borrowing or optional prepayment shall specify the Loans to be borrowed or
prepaid and the amount (subject to Section 4.02 hereof) of each Loan to be
borrowed or prepaid and the date of borrowing or optional prepayment (which
shall be a Business Day). Only those individuals identified on Exhibit C
attached hereto and incorporated herein shall be authorized to execute such
Borrowing Notice and this list may be amended from time to time only by action
of the Board of Directors of the Company, and a copy thereof certified to by the
Secretary of the Company shall be provided to the Lender.
Section 5. Conditions Precedent.
5.01 Effectiveness. The effectiveness of this Agreement is
subject to the condition precedent that the Lender shall have received this
Agreement in a form satisfactory to the Lender, which shall have been duly
executed by the Company and delivered to the Lender.
5.02 Initial and Subsequent Loans. The obligation of the
Lender to make any Loan to the Company upon the occasion of each borrowing
hereunder (including the initial borrowing) is subject to the further conditions
precedent that:
(a) the Lender shall have received a Borrowing Notice, duly
completed and executed;
(b) the Lender shall have received a Note, duly completed and
executed;
(c) both immediately prior to the making of such Loan and also
after giving effect thereto and to the intended use thereof:
(i) no Default shall have occurred and be continuing;
and
(ii) the representations and warranties made by the
Company in Section 6 hereof shall be true and complete on and
as of the date of the making of such Loan with the same force
and effect as if made on and as of such date
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(or, if any such representation or warranty is expressly
stated to have been made as of a specific date, as of such
specific date).
Section 6. Representations and Warranties. The Company represents and warrants
to the Lender and the Lender that:
6.01 Corporate Existence. The Company: (a) is a corporation,
partnership or other entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization; (b) has all
requisite corporate or other power, and has all material governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted; (c) is qualified to do
business and is in good standing in all jurisdictions in which the nature of the
business conducted by it makes such qualification necessary.
6.02 Financial Condition. The Company has heretofore furnished
to the Lender the balance sheet of the Company as of December 31, 1998 and as of
March 31, 1999. Such balance sheets present fairly in all material respects the
financial condition of the Company as at said date in accordance with GAAP. The
Company does not have on the date hereof and will not have on the Closing Date
any material contingent liabilities, liabilities for taxes, unusual forward or
long-term commitments or unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said balance
sheets as at said dates. Since the dates of said balance sheets, there has been
no material adverse change in the condition (financial or otherwise),
operations, business or prospects of the Company from that set forth in said pro
forma balance sheets as at said dates.
6.03 Litigation. There are no legal or arbitration
proceedings, or any proceedings by or before any governmental or regulatory
authority or agency, now pending or (to the knowledge of the Company) threatened
against the Company or any of its Property.
6.04 No Breach. None of the execution and delivery of this
Agreement and the Notes to which the Company is a party, the consummation of the
transactions herein and therein contemplated or compliance with the terms and
provisions hereof and thereof will conflict with or result in a breach of, or
require any consent under, the charter or by-laws of the Company, or any
applicable law or regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency, or any agreement or instrument to
which the Company is a party or by which it or any of its Property is bound or
to which it is subject, or constitute a default under any such agreement or
instrument, or result in the creation or imposition of any Lien upon any
Property of the Company pursuant to the terms of any such agreement or
instrument.
6.05 Action. The Company has all necessary corporate power,
authority and legal right to execute, deliver and perform its obligations under
each of the Credit Documents to which it is a party; the execution, delivery and
performance by the Company of each of the Credit Documents to which it is a
party have been duly authorized by all necessary corporate action on its part
(including, without limitation, any required shareholder approvals); and this
Agreement has been duly and validly executed and delivered by the Company and
constitutes, and each of the Notes to which it is a party when executed and
delivered (in the case of the Notes, for value) will constitute, its legal,
valid and binding obligation, enforceable against the Company in accordance with
its terms, except as such enforceability may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium or similar laws of general applicability
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affecting the enforcement of creditors' rights and (b) the application of
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
6.06 Approvals. No authorizations, approvals or consents of,
and no filings or registrations with, any governmental or regulatory authority
or agency, or any securities exchange, are necessary for the execution, delivery
or performance by the Company of this Agreement or any of the other Credit
Documents to which it is a party or for the legality, validity or enforceability
hereof or thereof, except for such insurance holding company filings as may be
required under Ohio law.
6.07 Taxes. As of the date hereof, the Company has filed all
required Federal or other tax returns or obtained extensions for such filings.
As of the date of each borrowing, the Company will have filed all Federal income
tax returns and all other material tax returns (if any) that are required to be
filed by it and will have paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company. The charges, accruals and
reserves on the books of the Company in respect of taxes and other governmental
charges are, in the opinion of the Company, adequate.
Section 7. Covenants of the Company. The Company covenants and agrees with the
Lender that, so long as any Commitment or Loan is outstanding and until payment
in full of all amounts payable by the Company hereunder:
7.01 Financial Statements, Etc. The Company shall deliver to
the Lender:
(a) as soon as available and in any event within 45 days after
the end of each quarterly fiscal period of each fiscal year of the
Company, statements of income, retained earnings and cash flows of the
Company for such period and for the period from the beginning of the
respective fiscal year to the end of such period, and the related
balance sheet of the Company as at the end of such period, setting
forth in each case in comparative form the corresponding figures for
the corresponding periods in the preceding fiscal year (except that,
(i) in the case of balance sheets, such comparison shall be to the last
day of the prior fiscal year and (ii) comparative information shall not
be required in the absence of a preceding fiscal year or a
corresponding period in a preceding fiscal year), accompanied by a
certificate of a senior officer of the Company, which certificate shall
state that said financial statements present fairly in all material
respects the financial condition and results of operations of the
Company in accordance with GAAP, as at the end of, and for, such period
(subject to normal year-end audit adjustments);
(b) promptly after the Company knows or has reason to believe
that any Default has occurred, a notice of such Default stating that
such notice is a "Notice of Default" and describing the same in
reasonable detail and, together with such notice or as soon thereafter
as possible, a description of the action that the Company has taken or
proposes to take with respect thereto;
(c) from time to time such other information regarding the
financial condition, operations, business or prospects of the Company
as the Lender may reasonably request.
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The Company will furnish to the Lender, at the time it
furnishes each set of financial statements pursuant to paragraph (a) above, a
certificate of a senior officer of the Company to the effect that no Default has
occurred and is continuing (or, if any Default has occurred and is continuing,
describing the same in reasonable detail and describing the action that the
Company has taken or proposes to take with respect thereto).
7.02 Litigation. The Company will promptly give to the Lender
notice of all material legal or arbitration proceedings, and of all material
proceedings by or before any governmental or regulatory authority or agency, and
any material development in respect of such legal or other proceedings,
affecting the Company.
7.03 Existence, Etc. The Company will:
(a) preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises;
(b) comply in all material respects with the requirements of
all applicable laws, rules, regulations and orders of governmental or
regulatory authorities;
(c) pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any
of its Property prior to the date on which penalties attach thereto,
except for any such tax, assessment, charge or levy the payment of
which is being contested in good faith and by proper proceedings and
against which adequate reserves are being maintained;
(d) maintain all of its Properties used or useful in its
business in good working order and condition, ordinary wear and tear
excepted;
(e) keep adequate records and books of account, in which
complete entries will be made in accordance with GAAP; and
(f) permit representatives of the Lender during normal
business hours, to examine, copy and make extracts from its books and
records, to inspect any of its Properties, and to discuss its business
and affairs with its officers, all to the extent reasonably requested
by such Lender.
7.04 Use of Proceeds. The Company will use the proceeds of the
Loans hereunder solely to finance the purchase from State Automobile Mutual
Insurance Company and public shareholders the Company's common shares, without
par value, pursuant to the Stock Repurchase Program approved by the Board of
Directors of the Company on May 7, 1999.
7.05 Modifications of Certain Documents. The Company will not
consent to any modification, supplement or waiver of any of the provisions of,
or assignment of any rights or obligations of any other Person under, any Credit
Documents without the prior consent of the Lender.
Section 8. Events of Default. If one or more of the following events (herein
called "Events of Default") shall occur and be continuing:
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(a) The Company shall default in the payment when due (whether
at stated maturity or upon optional prepayment) of any principal of or interest
on any Loan, any fee or any other amount payable by it hereunder or under any
other Credit Document to which it is a party; or
(b) Any representation, warranty or certification made or
deemed made herein or in any other Credit Document to which the Company is a
party (or in any modification or supplement hereto or thereto) by the Company,
or any certificate furnished to any Lender or the Lender pursuant to the
provisions hereof or thereof, shall prove to have been false or misleading as of
the time made or furnished in any material respect; or
(c) The Company shall default in the performance of any of its
obligations under any of Sections 7.04, or 7.05 hereof; the Company shall
default in the performance of any of its other obligations in this Agreement or
any other Credit Document to which it is a party and such default shall continue
unremedied for a period of thirty or more days after the occurrence of such
default; or
(d) The Company shall admit in writing its inability to, or be
generally unable to, pay its debts as such debts become due; or
(e) The Company shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee,
examiner or liquidator of itself or of all or a substantial part of its
Property, (ii) make a general assignment for the benefit of its creditors, (iii)
commence a voluntary case under the Bankruptcy Code, (iv) file a petition
seeking to take advantage of any other law relating to bankruptcy, insolvency,
reorganization, liquidation, dissolution, arrangement or winding-up, or
composition or readjustment of debts, (v) fail to controvert in a timely and
appropriate manner, or acquiesce in writing to, any petition filed against it in
an involuntary case under the Bankruptcy Code or (vi) take any corporate action
for the purpose of effecting any of the foregoing; or
(f) A proceeding or case shall be commenced, without the
application or consent of the Company, in any court of competent jurisdiction,
seeking (i) its reorganization, liquidation, dissolution, arrangement or
winding-up, or the composition or readjustment of its debts, (ii) the
appointment of a receiver, custodian, trustee, examiner, liquidator or the like
of the Company or of all or any substantial part of its respective Property or
(iii) similar relief in respect of the Company under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts, and such proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing shall be entered
and continue unstayed and in effect, for a period of 60 or more days; or an
order for relief against the Company shall be entered in an involuntary case
under the Bankruptcy Code.
THEREUPON: (1) in the case of an Event of Default other than one
referred to in clause (e) or (f) of this Section 8 with respect to the Company,
the Lender will, by notice to the Company, terminate the Commitment and/or
declare the principal amount then outstanding of, and the accrued interest on,
the Loans and all other amounts payable by the Company hereunder and under the
Notes to be forthwith due and payable, whereupon such amounts shall be
immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by the
Company; and (2) in the case of the occurrence of an Event of Default referred
to in clause (e) or (f) of this Section 8 with respect to the Company, the
Commitment shall automatically be terminated and the principal
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amount then outstanding of, and the accrued interest on, the Loans and all other
amounts payable by the Company hereunder and under the Notes shall automatically
become immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by the
Company.
Section 9. Miscellaneous.
9.01 Waiver. No failure on the part of the Lender to exercise
and no delay in exercising, and no course of dealing with respect to, any right,
power or privilege under this Agreement or any Note shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power or
privilege under this Agreement or any Note preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
9.02 Notices. All notices, requests and other communications
provided for herein (including, without limitation, any modifications of, or
waivers, requests or consents under, this Agreement) shall be given or made in
writing (including, without limitation, by telecopy) delivered to the intended
recipient at the "Address for Notices" specified below its name on the signature
page hereof); or, as to any party, at such other address as shall be designated
by such party in a notice to each other party. Except as otherwise provided in
this Agreement, all such communications shall be deemed to have been duly given
when transmitted by telecopier or personally delivered or, in the case of a
mailed notice, upon receipt, in each case given or addressed as aforesaid.
9.03 Amendments, Etc. Except as otherwise expressly provided
in this Agreement, any provision of this Agreement may be modified or
supplemented only by an instrument in writing signed by the Company and the
Lender. Any provision of this Agreement may be waived by the Lender, provided
that: no modification, supplement or waiver shall, unless by an instrument
signed by the Lender: (i) (except as provided in Section 2.07 hereof) increase,
or extend the term of, the Commitment, or extend the time or waive any
requirement for the reduction or termination of the Commitment, (ii) extend the
date fixed for the payment of principal of or interest on any Loan or any fee
hereunder, (iii) reduce the amount of any such payment of principal, (iv) reduce
the rate at which interest is payable thereon or any fee is payable hereunder,
(v) alter the rights or obligations of the Company to prepay Loans, (vi) alter
the manner in which payments or prepayments of principal, interest or other
amounts hereunder shall be applied as between the Lenders or Types of Loans,
(vii) alter the terms of this Section 9.03, (viii) waive any of the conditions
precedent set forth in Section 6.01 hereof.
9.04 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
9.05 Assignments and Participations.
(a) The Company may not assign any of its rights or
obligations hereunder or under the Notes without the prior consent of the
Lender.
(b) The Lender may not assign any of its Loans, its Notes, and
its Commitment.
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9.06 Captions. The table of contents and captions and section
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
9.07 Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this Agreement by
signing any such counterpart.
9.08 Governing Law; Submission to Jurisdiction. This Agreement
and the Notes shall be governed by, and construed in accordance with, the law of
the State of Ohio. The Company hereby submits to the nonexclusive jurisdiction
of the United States District Court for the Southern District of Ohio and of the
Court of Common Pleas sitting in Franklin County, including its Appellate
Division, in the State of Ohio, for the purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. The Company hereby irrevocably waives, to the fullest extent permitted
by applicable law, any objection that it may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum.
9.09 Waiver of Jury Trial. THE COMPANY AND THE LENDER HEREBY
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
9.10 Treatment of Certain Information; Confidentiality.
(a) The Lender agrees (on behalf of itself and each of its
affiliates, directors, officers, employees and representatives) to use
reasonable precautions to keep confidential, in accordance with its customary
procedures for handling confidential information of the same nature and in
accordance with safe and sound business practices, any non-public information
supplied to it by the Company pursuant to this Agreement that is identified by
the Company as being confidential at the time the same is delivered to the
Lender, provided that nothing herein shall limit the disclosure of any such
information (i) after such information shall have become public (other than
through a violation of this Section 9.10), (ii) to the extent required by
statute, rule, regulation or judicial process, (iii) to counsel for the Lender,
(iv) to any regulatory authority having jurisdiction over the Lender, or to
auditors or accountants, (v) in connection with any litigation to which the
Lender is a party, or in connection with the enforcement of rights or remedies
hereunder or under any other Credit Document.
9.11 No Recourse. No recourse shall be had for any obligation
owing to the Lender under any Credit Document or for the payment of any fee due
to any Lender under any Credit Document or any other obligation or claim arising
out of or based upon any Credit Document against any stockholder, employee,
officer, director, affiliate or incorporator of the Company, based on their
status as such or their actions in connection therewith, except to the extent
resulting from the fraud or willful misconduct of such stockholder, employee,
officer, director, affiliate or incorporator of the Company based on their
status as such or their actions in connection therewith, except to the extent
resulting from the fraud or willful misconduct of such stockholder, employee,
officer, director, affiliate, or incorporator, as the case may be. The
provisions of this section shall survive the termination of any or all Credit
Documents.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.
STATE AUTO FINANCIAL CORPORATION
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------
Title: Vice President
Address for Notices:
STATE AUTO FINANCIAL CORPORATION
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
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LENDER
------
Commitment
----------
$30,000,000
STATE AUTOMOBILE MUTUAL INSURANCE COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------
Title:
Address for Notices:
STATE AUTOMOBILE MUTUAL INSURANCE COMPANY
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
15
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EXHIBIT A to the Credit Agreement
[Form of Note]
PROMISSORY NOTE
$_______________ __________ __, 199_
Columbus, OH
FOR VALUE RECEIVED, STATE AUTO FINANCIAL CORPORATION, an Ohio
corporation (the "Company"), hereby promises to pay to STATE AUTOMOBILE MUTUAL
INSURANCE COMPANY (the "Lender") for its account as provided by the Credit
Agreement referred to below, at the principal office of the Lender in Columbus,
OH, the principal sum of _______________ Dollars (or such lesser amount as shall
equal the aggregate unpaid principal amount of the Loans made by the Lender to
the Company under the Credit Agreement), in lawful money of the United States of
America and in immediately available funds, on the dates and in the principal
amounts provided in the Credit Agreement, and to pay interest on the unpaid
principal amount of each such Loan, at such office, in like money and funds, for
the period commencing on the date of such Loan until such Loan shall be paid in
full, at the rates per annum and on the dates provided in the Credit Agreement.
The date, amount, and interest rate of each Loan made by the Lender to
the Company, and each payment made on account of the principal thereof, shall be
recorded by the Lender on its books, provided that the failure of the Lender to
make any such recordation (or any error by such Lender in making any such
recordation) or endorsement shall not affect the obligations of the Company to
make a payment when due of any amount owing under the Credit Agreement or
hereunder in respect of the Loans made by the Lender.
This Note is one of the Notes referred to in the Credit Agreement dated
as of June 1, 1999 (as modified and supplemented and in effect from time to
time, the "Credit Agreement") between the Company and the Lender, and evidences
Loans made by the Lender thereunder. Capitalized terms used, but not defined in
this Note, have the respective meanings assigned to them in the Credit
Agreement.
The Credit Agreement provides for the acceleration of the maturity of
this Note upon the occurrence of certain events and for optional prepayments of
Loans upon the terms and conditions specified therein.
This Note may not be assigned by the Lender.
This Note shall be governed by, and construed in accordance with, the
law of the State of Ohio.
STATE AUTO FINANCIAL CORPORATION
By
-----------------------------------------------
Title:
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SCHEDULE OF LOANS
This Note evidences Loans made under the within-described Credit
Agreement to the Company, on the dates, in the principal amounts, bearing
interest at the rates set forth below, subject to the payments, and prepayments
of principal set forth below:
--------------------------------------------------------------------------------------------------------------
Date Made Principal Amount of Loan Interest Rate Amt. Paid, Unpaid or Prepaid
Principal
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
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EXHIBIT B to the Credit Agreement
State Automobile Mutual Insurance Company
Chief Financial Officer
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Credit Agreement dated as of June 1, 1999, between State Auto Financial
Corporation and State Automobile Mutual Insurance Company.
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of June 1, 1999 (as modified
and supplemented and in effect from time to time, the "Credit Agreement"),
between STATE AUTO FINANCIAL CORPORATION (the "Company"), and STATE AUTOMOBILE
MUTUAL INSURANCE COMPANY, as Lender. Capitalized terms used but not defined
herein shall have the respective meanings assigned to such terms in the Credit
Agreement.
Pursuant to Section 2.02 of the Credit Agreement, the Company hereby notifies
you that it will make a borrowing of a Loan on ______________, 199___ in the
principal amount of $_____________.
STATE AUTO FINANCIAL CORPORATION
By
------------------------------
Title:
1 Insert a date falling on or after the third Business Day following the
date of this Notice
2 Insert an amount at least equal to $500,000 or a larger integral
multiple of $500,000.
