EXHIBIT 99.1
MERITOR AUTOMOTIVE, INC.
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CREDIT AGREEMENT
dated as of January 15, 1999
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THE LENDERS PARTY HERETO,
UBS AG, STAMFORD BRANCH,
as Administrative Agent
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WARBURG DILLON READ LLC,
as Arranger
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NBD BANK,
as Documentation Agent
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS..............................................1
ARTICLE II THE CREDITS.............................................15
2.1 Commitments.............................................15
2.2 Repayment of Loans; Evidence of Debt....................15
2.3 Procedures for Borrowing................................16
2.4 Fees....................................................17
2.5 Optional and Mandatory Principal Payments on All
Loans...................................................17
2.6 Conversion and Continuation of Outstanding Loans........18
2.7 Interest Rates, Interest Payment Dates; Interest
and Fee Basis...........................................19
2.8 Changes in Interest Rate, etc...........................19
2.9 Rates Applicable After Default..........................20
2.10 Pro Rata Payment, Method of Payment.....................20
2.11 Telephonic Notices......................................21
2.12 Notification of Loans, Interest Rates,
Prepayments and Commitment Reductions...................21
2.13 Lending Offices.........................................21
2.14 Non-Receipt of Funds by the Administrative Agent........21
2.15 Application of Payments with Respect to Defaulting
Lenders.................................................22
ARTICLE III CHANGE IN CIRCUMSTANCES, TAXES..........................22
3.1 Yield Protection........................................22
3.2 Changes in Capital Adequacy Regulations.................23
3.3 Availability of Types of Loans..........................23
3.4 Funding Indemnification.................................23
3.5 Lender Statements; Survival of Indemnity................24
3.6 Taxes...................................................24
3.7 Substitution of Lender..................................26
ARTICLE IV CONDITIONS PRECEDENT....................................26
4.1 Closing Date Conditions.................................27
4.2 Conditions to Borrowing Date............................29
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ARTICLE V REPRESENTATIONS AND WARRANTIES..........................31
5.1 Corporate Existence and Standing........................31
5.2 Authorization and Validity..............................31
5.3 No Conflict; Government Consent.........................31
5.4 Financial Statements....................................32
5.5 Material Adverse Change.................................32
5.6 Taxes...................................................32
5.7 Litigation and Contingent Obligations...................33
5.8 Subsidiaries............................................33
5.9 ERISA...................................................33
5.10 Accuracy of Information.................................33
5.11 Regulation U............................................34
5.12 Material Agreements.....................................34
5.13 Compliance With Laws....................................34
5.14 Plan Assets; Prohibited Transactions....................34
5.15 Environmental Matters...................................34
5.16 Investment Company Act..................................34
5.17 Public Utility Holding Company Act......................35
5.18 Related Agreements......................................35
5.19 Year 2000 Compliance....................................35
ARTICLE VI COVENANTS...............................................36
6.1 Financial Reporting.....................................36
6.2 Use of Proceeds.........................................37
6.3 Notice of Default.......................................37
6.4 Conduct of Business.....................................37
6.5 Taxes...................................................38
6.6 Insurance...............................................38
6.7 Compliance with Laws....................................38
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6.8 Maintenance of Properties...............................38
6.9 Inspection..............................................38
6.10 Subsidiary Indebtedness.................................38
6.11 Merger..................................................39
6.12 Sale of Assets..........................................39
6.13 Investments and Acquisitions............................40
6.14 Liens...................................................41
6.15 Affiliates..............................................43
6.16 Contingent Obligations..................................43
6.17 Debt Ratio..............................................43
6.18 Net Worth...............................................44
6.19 Year 2000 Compliance....................................44
ARTICLE VII DEFAULTS................................................44
ARTICLE VIII ACCELERATION WAIVERS, AMENDMENTS AND REMEDIES...........47
8.1 Acceleration............................................47
8.2 Amendments..............................................47
8.3 Preservation of Rights..................................48
ARTICLE IX GENERAL PROVISIONS......................................48
9.1 Survival of Representations.............................48
9.2 Governmental Regulation.................................48
9.3 Taxes...................................................48
9.4 Headings................................................48
9.5 Entire Agreement........................................48
9.6 Several Obligations; Benefits of this Agreement.........49
9.7 Expenses; Indemnification...............................49
9.8 Numbers of Documents....................................50
9.9 Accounting..............................................50
9.10 Severability of Provisions..............................50
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9.11 Non-liability of Lenders................................50
9.12 Confidentiality.........................................50
9.13 Nonreliance.............................................51
9.14 Setoff..................................................51
9.15 Ratable Sharing.........................................51
ARTICLE X AGENTS..................................................51
10.1 Appointment.............................................51
10.2 Powers and Duties; General Immunity.....................52
10.3 Representations and Warranties; No Responsibility
For Appraisal of Creditworthiness.......................54
10.4 Right to Indemnity......................................54
10.5 Successor Administrative Agent..........................54
ARTICLE XI BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS.......55
11.1 Successors and Assigns..................................55
11.2 Participations..........................................55
11.3 Assignments.............................................56
11.4 Dissemination of Information............................57
11.5 Tax Treatment...........................................57
ARTICLE XII NOTICES.................................................57
12.1 Giving Notices..........................................57
12.2 Change of Address.......................................58
ARTICLE XIII COUNTERPARTS............................................58
ARTICLE XIV CHOICE OF LAW, CONSENT TO JURISDICTION, WAIVER
OF JURY TRIAL...........................................58
14.1 Choice of Law...........................................58
14.2 Waiver of Jury Trial....................................58
14.3 Submission to Jurisdiction; Waivers.....................58
14.4 Acknowledgments.........................................59
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EXHIBITS:
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A Pricing
B Form of Borrowing Notice
C Form of Conversion/Continuation Notice
D Form of Note
E Form of Compliance Certificate
F Form of Opinion of Counsel to Company
G Form of Opinion of O'Melveny & Xxxxx LLP
H Form of Assignment Agreement
I Form of Certificate Re Non-Bank Status
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SCHEDULES:
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1 Commitments
5.7 Certain Litigation
5.8 Subsidiaries of Company
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THIS CREDIT AGREEMENT (this "Agreement") is dated as of
January 15, 1999, among MERITOR AUTOMOTIVE, INC., a Delaware corporation (the
"Company"), the Lenders from time to time parties hereto, WARBURG DILLON READ
LLC ("WDR"), as arranger, UBS AG, STAMFORD BRANCH ("UBS"), as administrative
agent for the Lenders, and NBD BANK, as documentation agent. Capitalized terms
used in this preamble and in the recitals without definition are defined in
Article I hereof.
WHEREAS, on the Borrowing Date, the Company will purchase
substantially all of the assets of the Heavy Vehicle Braking Systems Division of
the Seller pursuant to the LucasVarity Acquisition Agreement for an aggregate
consideration not to exceed $400,000,000 (excluding post-closing working capital
adjustments not to exceed $20,000,000);
WHEREAS, Lenders have agreed to extend certain credit
facilities to the Company in the aggregate amount of $300,000,000, the proceeds
of which will be used, together with cash on hand of the Company and borrowings
under the Existing Credit Agreement, to fund the LucasVarity Acquisition
Financing Requirements;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements contained herein, the parties hereto agree as follows:
ARTICLE I
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DEFINITIONS
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Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
"Acquired Division" means the assets of the Heavy Vehicle
Braking Systems Division of the Seller to be acquired on the Borrowing Date
pursuant to the LucasVarity Acquisition Agreement.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Company or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.
"Administrative Agent" means UBS in its capacity as
administrative agent for the Lenders pursuant to Article X, and not in its
individual capacity as a Lender, and any successor Administrative Agent
appointed pursuant to Article X.
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"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such Person.
A Person shall be deemed to control another Person if the controlling Person
owns 10% or more of any class of voting securities (or other ownership
interests) of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of stock, by contract or otherwise.
"Agreement" means this Credit Agreement, as it may be amended
or modified and in effect from time to time.
"Agreement Accounting Principles" means generally accepted
accounting principles as in effect from time to time in the United States,
applied in a manner consistent with the most recent audited consolidated
financial statements of the Company and its Subsidiaries and delivered to the
Lenders; provided that, if the Company notifies the Administrative Agent that
the Company wishes to amend any covenant contained in Article VI to eliminate
the effect of any change in generally accepted accounting principles on the
calculation of such covenant (or if the Administrative Agent notifies the
Company that the Required Lenders wish to amend Article VI for such purpose),
then the Company's compliance with such covenant shall be determined on the
basis of generally accepted accounting principles in effect immediately before
the relevant change in generally accepted accounting principles became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Company and the Required Lenders.
"Aggregate Outstandings" means, at any date of determination
with respect to any Lender, an amount equal to the aggregate unpaid principal
amount of such Lender's Loan on such date.
"Alternate Base Rate" means, for any day, a rate of interest
per annum equal to the higher of (a) the Corporate Base Rate for such day and
(b) the sum of the Federal Funds Effective Rate for such day plus 1/2% per
annum.
"Applicable Margin" means the per annum rate determined from
time to time in accordance with the Pricing Schedule on Exhibit A annexed
hereto.
"Arranger" means WDR in its capacity as arranger pursuant to
Article X.
"Article" means an article of this Agreement unless another
document is specifically referenced.
"Assignment" is defined in Section 11.3.1.
"Authorized Officer" means any of the Chairman of the Board of
the Company, the Senior Vice President and Chief Financial Officer of the
Company or any person designated by the Senior Vice President and Chief
Financial Officer or the Chairman of the Board of the Company in writing to the
Administrative Agent from time to time, acting singly.
2
"Borrowing Date" means the Business Day on or after the
Closing Date (but no later than January 31, 1999) (a) specified in the Borrowing
Notice as the date on which the Company requests the Lenders to make the Loans
hereunder and (b) on which the conditions precedent set forth in Section 4.2 are
satisfied or waived in accordance with the terms of this Agreement.
"Borrowing Notice" means a notice substantially in the form of
Exhibit B annexed hereto delivered by the Company to the Administrative Agent
pursuant to Section 2.3 with respect to the Borrowing Date.
"Business Day" means (a) when such term is used to describe a
day on which a borrowing, payment or interest rate determination is to be made
in respect of a Eurodollar Loan, a London Banking Day; and (b) when such term is
used in any context in this Agreement (including as described in the foregoing
clause (a)), a day which, in addition to complying with any applicable
requirements set forth in the foregoing clause (a), is a day other than a
Saturday, Sunday or other day on which commercial banks in New York City or
Stamford, Connecticut are authorized or required by law to close.
"Capitalized Lease" of a Person means any lease of Property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount
of the obligations of such Person under Capitalized Leases which would be shown
as a liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Change in Control" means any of the following events or
circumstances: (a) any Person or group of Persons (within the meaning of Section
13(d) or 14(d) of the Securities Exchange Act of 1934, as amended) shall either
(i) acquire beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
40% or more of the outstanding shares of voting stock of the Company or (ii)
obtain the power (whether or not exercised) to elect a majority of the Company's
directors or (b) Continuing Directors shall cease to constitute a majority of
the board of directors of the Company.
"Closing Date" means the date on which the conditions
precedent to the effectiveness of this Agreement set forth in Section 4.1 are
satisfied or waived in accordance with the terms of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.
"Commitment" means, as to any Lender at any time, its
obligation to make a Loan to the Company pursuant to Section 2.1 in an amount
not to exceed the U.S. Dollar amount set forth opposite such Lender's name in
Schedule I under the heading "Commitment" or as otherwise established pursuant
to Section 11.3, as such amount may be reduced from time to time pursuant to
Section 2.5, Section 11.3 and the other applicable provisions hereof.
3
"Commitment Termination Date" is defined in Section 2.1.
"Committed Percentage" means, as to any Lender at any time,
the percentage which such Lender's Commitment then constitutes of the aggregate
Commitments of all Lenders (or, if the Commitments have terminated or expired,
the percentage which (a) the Aggregate Outstandings of such Lender at such time
then constitutes of (b) the Aggregate Outstandings of all Lenders at such time).
"Company" is defined in the preamble hereto.
"Condemnation" is defined in Section 7.8.
"Confidential Information Memorandum" means the Confidential
Information Memorandum dated December 1998 relating to the Loans.
"Consultant" is defined in Section 6.19.
"Contingent Obligation" of a Person means any agreement,
undertaking or arrangement by which such Person assumes, guarantees, endorses,
contingently agrees to purchase or provide funds for the payment of, or
otherwise becomes or is contingently liable upon, the obligation or liability of
any other Person, or agrees to maintain the net worth or working capital or
other financial condition of any other Person, or otherwise assures any creditor
of such other Person against loss, including, without limitation, any comfort
letter, operating agreement or take-or-pay contract. The amount of any
Contingent Obligation shall be equal to the amount of the obligation that is so
guarantied or supported that is actually outstanding or otherwise due and
payable from time to time, if a fixed and determinable amount, or, if there is
no fixed or determinable amount, either (x) if a maximum amount is guaranteed,
the maximum amount or (y) if there is no maximum amount, the amount of the
obligation that is so guarantied or supported.
"Continuing Director" means any member of the Company's board
of directors who either (a) is a member of such board as of the Closing Date or
(b) is thereafter elected to such board, or nominated for election by
stockholders, by a vote of at least two-thirds of the directors who are
Continuing Directors at the time of such vote; provided that an individual who
is so elected or nominated in connection with a merger, consolidation,
acquisition or similar transaction shall not be a Continuing Director unless
such individual was a Continuing Director prior thereto.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company or any of its Subsidiaries, are
treated as a single employer under Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.6.
4
"Conversion Date" means any date on which either (a) a Default
under Section 7.6 or 7.7 has occurred or (b) the Commitments shall have been
terminated and/or the Loans shall have been declared immediately due and payable
pursuant to Section 8.1(b).
"Corporate Base Rate" means a rate per annum equal to the UBS
prime rate of interest announced by UBS from time to time, changing when and as
said prime rate changes.
"Debt Ratio" means, as of the last day of any fiscal quarter
commencing with the fiscal quarter ending March 31, 1999, the ratio of (a) Total
Debt to (b) EBITDA for the four consecutive fiscal quarters ended on such date.
"Default" means an event described in Article VII.
"Defaulting Lender" means any Lender that on the Borrowing
Date fails to make available to the Administrative Agent such Lender's Loan
required to be made to the Company on the Borrowing Date. Once a Lender becomes
a Defaulting Lender, such Lender shall continue as a Defaulting Lender until
such time as such Defaulting Lender makes available to the Administrative Agent
the amount of such Defaulting Lender's Loan together with all other amounts
required to be paid to the Administrative Agent pursuant to this Agreement.
"Designated Financial Officer" means, with respect to the
Company, its chief financial officer, treasurer or controller.
"Documentation Agent" means NBD Bank in its capacity as
documentation agent pursuant to Article X, and not in its individual capacity as
a Lender.
"Dollars," "U.S. Dollars" and "$" means dollars in lawful
currency of the United States of America.
"EBITDA" means for any period, the sum of (a) the consolidated
net income (or loss) of the Company and its Subsidiaries for such period
determined in conformity with Agreement Accounting Principles, plus (b) to the
extent deducted in determining net income, income taxes, depreciation and
amortization expense and Interest Expenses.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
(a) the protection of the environment, (b) the effect of the environment on
human health, (c) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land, or (d)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof, in each case applicable to
the Company or its Property.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation issued
thereunder.
5
"Euclid Acquisition" means the acquisition of Euclid
Industries on substantially the terms described in the Confidential Information
Memorandum.
"Eurodollar Base Rate" means, with respect to a Eurodollar
Loan for the relevant Eurodollar Interest Period, the per annum rate determined
by the Administrative Agent to be the rate for deposits in U.S. Dollars for a
period equal to such Eurodollar Interest Period commencing on the first day of
such Eurodollar Interest Period appearing on Page 3750 of the Telerate screen as
of 11:00 a.m. (London time) two Business Days prior to the first day of such
Eurodollar Interest Period; provided, however, that in the event that such rate
does not appear on Page 3750 of the Telerate Service (or otherwise on such
service), the Eurodollar Base Rate shall be (i) determined by reference to such
other publicly available service for displaying Eurodollar rates as may be
agreed upon by the Administrative Agent and the Company or (ii) in the absence
of such agreement, the arithmetic average of the rates reported to the
Administrative Agent by each Reference Lender as the rate at which such
Reference Lender offers to place deposits in U.S. Dollars with first-class banks
in the London interbank market at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Eurodollar Interest Period, in the
approximate amount of such Reference Lender's relevant Eurodollar Loan and
having a maturity approximately equal to such Eurodollar Interest Period. If any
Reference Lender fails to provide such quotation to the Administrative Agent,
then the Administrative Agent shall determine the Eurodollar Base Rate on the
basis of the quotations of the remaining Reference Lender(s).
"Eurodollar Interest Period" means with respect to any
Eurodollar Loan:
(a) initially, the period commencing on the borrowing or conversion date, as the
case may be, with respect to such Eurodollar Loan and ending one, two or three
months thereafter, as selected by the Company in its Borrowing Notice or
Conversion/Continuation Notice, as the case may be, given with respect thereto;
and
(b) thereafter, each period commencing on the last day of the next preceding
Eurodollar Interest Period applicable to such Eurodollar Loan and ending one,
two or three months thereafter, as selected by the Company by
Conversion/Continuation Notice to the Administrative Agent not less than three
Business Days prior to the last day of the then current Eurodollar Interest
Period with respect thereto; provided that, all of the foregoing provisions
relating to Eurodollar Interest Periods are subject to the following:
(i) if any Eurodollar Interest Period pertaining to a Eurodollar
Loan would otherwise end on a day that is not a Business Day,
such Eurodollar Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension
would be to carry such Eurodollar Interest Period into another
calendar month in which event such Eurodollar Interest Period
shall end on the immediately preceding Business Day;
(ii) any Eurodollar Interest Period applicable to a Eurodollar Loan
that would otherwise extend beyond the Maturity Date shall end
on such date;
6
(iii) the number of Eurodollar Interest Periods outstanding at any
time shall not exceed five; and
(iv) any Eurodollar Interest Period pertaining to a Eurodollar Loan
that 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 Eurodollar Interest
Period) shall end on the last Business Day of a calendar
month.
"Eurodollar Loan" means a Loan which bears interest at a rate
determined with reference to a Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Loan for
the relevant Eurodollar Interest Period, the sum of (a) the quotient of (i) the
Eurodollar Base Rate applicable to such Eurodollar Interest Period, divided by
(ii) one minus the Reserve Requirement (expressed as a decimal) applicable to
such Eurodollar Interest Period, plus (b) the Applicable Margin in effect from
time to time. The Eurodollar Rate shall be rounded to the next higher multiple
of 1/100 of 1% if the rate is not such a multiple.
"Excluded Equity Issuance" means any issuance of equity
securities of the Company to officers, employees or directors of the Company or
any of its Subsidiaries pursuant to any employee stock option, savings or stock
purchase plan or other employee benefit plan.
"Excluded Indebtedness" means (i) Indebtedness incurred by the
Company pursuant to the Existing Credit Agreement in an aggregate amount,
together with any Excluded Subsidiary Debt referred to in clause (i) of the
definition of that term, not to exceed $1,000,000,000; (ii) Excluded Subsidiary
Debt; (iii) Indebtedness of the type described in clauses (b), (e), (f) and (g)
of the definition thereof and (iv) intercompany Indebtedness, in each case so
long as such Indebtedness is not otherwise prohibited under this Agreement.
"Excluded Subsidiary Debt" means (i) Indebtedness incurred by
a Foreign Subsidiary Borrower (as defined in the Existing Credit Agreement as in
effect on the Closing Date) pursuant to the Existing Credit Agreement in an
aggregate amount not to exceed the amount available for borrowing by such
Foreign Subsidiary Borrower under such agreement as in effect on the Closing
Date and (ii) Indebtedness incurred by a Foreign Subsidiary Borrower pursuant to
any other credit facility so long as such Indebtedness is not otherwise
prohibited under this Agreement (including Section 6.10).
"Existing Credit Agreement" means the Credit Agreement dated
as of August 21, 1997 between the Company, certain foreign subsidiary borrowers,
First Chicago Capital Markets, Inc., as syndication agent and arranger, Xxxxxx
Guaranty Trust Company of New York, as administrative agent, NBD Bank, as
documentation agent, and the lenders party thereto, as such Credit Agreement has
heretofore been and as it may hereafter be amended, supplemented or otherwise
modified from time to time.
7
"Federal Funds Effective Rate" means, for any day, an interest
rate per annum equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published for such day (or, if such day is
not a Business Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations at approximately 10:00 a.m.
(New York City time) on such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent in its sole discretion.
"Financial Contract" of a Person means (a) any exchange-traded
or over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics or (b) any Rate Hedging Agreement.
"Floating Rate" means, for any day, a rate per annum (based on
a year of 365 or 366 days, as appropriate) equal to the Alternate Base Rate for
such day, in each case changing when and as the Alternate Base Rate changes.
"Floating Rate Loan" means a Loan which bears interest at a
rate determined with reference to the Floating Rate.
"Governmental Authority" means any nation or government, any
state, or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Indebtedness" of a Person means, without duplication, such
Person's (a) obligations for borrowed money, (b) obligations representing the
deferred purchase price of Property or services (other than accounts payable
arising in the ordinary course of such Person's business payable on terms
customary in the trade), (c) obligations, whether or not assumed, secured by
Liens on property now or hereafter owned or acquired by such Person, (d)
obligations which are evidenced by notes, acceptances, or other instruments
(other than Financial Contracts), to the extent of the amounts actually
borrowed, due, payable or drawn, as the case may be, (e) Capitalized Lease
Obligations, (f) all obligations in respect of letters of credit, whether drawn
or undrawn, contingent or otherwise, and (g) Contingent Obligations with respect
to any of the foregoing to the extent (and only to the extent) that (i) such
Contingent Obligation relates to other Indebtedness that is not consolidated
Indebtedness of the Company and its Subsidiaries and (ii) the other Indebtedness
to which such Contingent Obligation relates is outstanding and then only as to
principal or like amounts actually borrowed, due, payable or drawn, as the case
may be.
"Interest Expenses" means, with respect to any period, the
aggregate of all interest expense reported by the Company and its Subsidiaries
in accordance with Agreement Accounting Principles during such period, net of
any interest income received by the Company and its Subsidiaries during such
period from Investments. As used in this definition, the term "interest" shall
include, without limitation, all interest, fees and costs payable with respect
to the obligations under this Agreement (other than fees and costs which may be
capitalized as
8
transaction costs in accordance with Agreement Accounting Principles), any
discount in respect of sales of accounts receivable and/or related contract
rights and the interest portion of Capitalized Lease payments during such
period, all as determined in accordance with Agreement Accounting Principles.
"Investment" of a Person means (i) any loan, advance (other
than commission, travel and similar advances to officers and employees made in
the ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade and loans to employees in the ordinary course of business) or contribution
of capital by such Person; (ii) stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; (iii) any
deposit accounts and certificates of deposit owned by such Person; and (iv)
structured notes, derivative financial instruments and other similar instruments
or contracts owned by such Person (other than Financial Contracts).
"Lenders" means the lending institutions listed on the
signature pages of this Agreement and their respective successors and, to the
extent permitted by Section 11.3, assigns.
"Lending Office" means, with respect to a Lender or the
Administrative Agent, any office, branch, subsidiary or affiliate of such Lender
or the Administrative Agent.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's loan
made pursuant to Section 2.1 and "Loans" means each such Loan, collectively.
"Loan Documents" means this Agreement, the Notes and the other
documents and agreements contemplated hereby and executed by the Company in
favor of the Administrative Agent or any Lender.
"London Banking Day" means any day on which banks in London
are open for general banking business, including dealings in foreign currency
and exchange.
"LucasVarity Acquisition" means the transactions contemplated
by the LucasVarity Acquisition Agreement.
"LucasVarity Acquisition Agreement" means, collectively (i)
that certain Umbrella Agreement dated November 22, 1998 by and among LucasVarity
plc, the Company, Xxxxx Industries plc, Meritor Heavy Vehicle Braking Systems
(UK) Limited and certain other Persons named therein; (ii) that certain
Agreement dated November 22, 1998 by and among Xxxxx Limited, Meritor Heavy
Vehicle Braking Systems (UK) Limited, Xxxxx Industries plc, Xxxxx France SAS and
the Company, relating to the sale and purchase of assets of the Acquired
9
Division in the United Kingdom and France; (iii) that certain United States Sale
Agreement dated as of November 22, 1998 by and between Xxxxxx-Xxxxx Company and
Meritor Heavy Vehicle Braking Systems (U.S.A.), Inc., relating to the sale and
purchase of assets of the Acquired Division in the United States; (iv) that
certain Agreement dated November 22, 1998 by and among Xxxxx Automotive GmbH,
Xxxxx Limited, Meritor Automotive GmbH and the Company, relating to the sale and
purchase of assets of the Acquired Division in Germany; and (v) that certain
Transfer and Amendment Agreement dated November 22, 1998 by and among Xxxxx
Industries plc, Huayang Group and the Company, relating to the transfer of Xxxxx
Industries plc's joint venture interest in Xxxxx Xxxxxx Vehicle Braking Company
Limited in the People's Republic of China; in each case, in the form delivered
to the Administrative Agent prior to its execution of this Agreement and as such
agreement may be amended, supplemented or otherwise modified from time to time
thereafter to the extent permitted hereunder.
"LucasVarity Acquisition Financing Requirements" means the
aggregate of all amounts necessary (a) to finance the purchase price payable in
connection with the LucasVarity Acquisition, (b) to refinance all Indebtedness
outstanding relating to the Acquired Division other than Indebtedness permitted
hereunder and (c) to pay fees, costs and expenses payable by the Company on the
Borrowing Date in connection with the transactions contemplated by the
LucasVarity Acquisition Agreement.
"Margin Stock" means margin stock as defined in Regulation T,
Regulation U or Regulation X.
"Material Adverse Effect" means a material adverse effect on
(a) the business, Property, condition (financial or otherwise) or results of
operations of the Company and its Subsidiaries taken as a whole, (b) the ability
of the Company to pay the Obligations under the Loan Documents, or (c) the
validity or enforceability of any of the Loan Documents or the rights or
remedies of the Administrative Agent or the Lenders thereunder.
"Material Indebtedness" is defined in Section 7.5.
"Material Plan" is defined in Section 7.10.
"Maturity Date" means January 14, 2000.
"Moody's Bond Rating" means for any day, the rating of the
Company's senior long-term unsecured debt by Xxxxx'x Investors Service, Inc.
("Moody's") in effect at 11:00 a.m., New York City time, on such day.
"Multiemplover Plan" means a plan defined in Section 4001
(a)(3) of ERISA to which the Company or any member of the Controlled Group has
an obligation to contribute.
"Net Securities Proceeds" is defined in Section 2.5.3.
"Net Worth" means the consolidated shareholder's equity of the
Company and its Subsidiaries, including minority interests, calculated in
accordance with Agreement Accounting
10
Principles, provided that the amount of adjustment for foreign currency
translation shall be deemed equal at all times to the amount described in the
audited financial statements of the Company and its Subsidiaries for the fiscal
year ending September 30, 1998 delivered to the Lenders pursuant to Section
4.1.2 for purposes of determining Net Worth under this Agreement.
"Non-Excluded Taxes" is defined in Section 3.6.1.
"Note" is defined in Section 2.2.5.
"Notice of Assignment" is defined in Section 11.3.2.
"Obligations" means collectively, the unpaid principal of and
interest on the Loans and all other obligations and liabilities of the Company
under this Agreement and the other Loan Documents (including, without
limitation, interest accruing at the then applicable rate provided in this
Agreement or any other applicable Loan Document after the maturity of the Loans
and interest accruing at the then applicable rate provided in this Agreement or
any other applicable Loan Document after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding relating to the Company, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, the other Loan Documents or any other document made, delivered or
given in connection therewith, in each case whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by
the Company pursuant to the terms of this Agreement or any other Loan Document).
"Officer's Certificate" means, as applied to any corporation,
a certificate executed on behalf of such corporation by its chairman of the
board (if an officer) or its president or one of its vice presidents or by a
Designated Financial Officer; provided that every Officer's Certificate with
respect to the compliance with a condition precedent to the making of the Loans
hereunder shall include (a) a statement that the officer making or giving such
Officer's Certificate has read such condition and any definitions or other
provisions contained in this Agreement relating thereto, (b) a statement that,
in the opinion of the signer, he or she has made or has caused to be made such
examination or investigation as is necessary to enable him or her to certify as
to whether or not such condition has been complied with, and (c) a statement
certifying that such condition has been complied with.
"Participants" is defined in Section 11.2.1.
"Payment Date" means the last Business Day of each March,
June, September and December occurring after the date hereof, commencing March
31, 1999.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.
11
"Person" means any natural person, corporation, firm, joint
venture, limited liability company, partnership, association, enterprise, trust
or other entity or organization, or any government or political subdivision or
any agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered
by Title IV of ERISA or subject to the minimum funding standards under Section
412 of the Code as to which the Company or any member of the Controlled Group
has any obligation to contribute to on or after the Closing Date.
"Plan of Correction" is defined in Section 5.19.
"Pro Forma Balance Sheet" is defined in Section 4.1.2.
"Projections" is defined in Section 4.1.2.
"Property" of a Person means any and all property, whether
real, personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person.
"Purchasers" is defined in Section 11.3.1.
"Rate Hedging Agreement" means an agreement, device or
arrangement providing for payments which are related to fluctuations of interest
rates, exchange rates or forward rates, including, but not limited to,
dollar-denominated or cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts and warrants.
"Rate Hedging Obligations" of a Person means any and all
obligations of such Person, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor), under (a) any
and all Rate Hedging Agreements, and (b) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Hedging Agreement.
"Reference Lenders" means UBS, Bank of America NT & SA First
National Bank of Chicago, in their capacities as Lenders.
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors.
12
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors.
"Replaced Lender" is defined in Section 3.7.
"Replacement Lender" is defined in Section 3.7.
"Reportable Event" means a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such section occurring
after the Closing Date, with respect to a Plan, excluding, however, such events
as to which the PBGC by regulation waived the requirement of Section 4043(a) of
ERISA that it be notified within 30 days of the occurrence of such event;
provided, however, that a failure to meet the minimum funding standard of
Section 412 of the Code and of Section 302 of ERISA shall be a Reportable Event
regardless of the issuance of any such waiver of the notice requirement in
accordance with either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Required Lenders" means (a) at any time prior to the
termination of the Commitments, Lenders the Committed Percentages of which
aggregate at least 51%; and (b) at any time after the termination of the
Commitments, Lenders whose Aggregate Outstandings aggregate at least 51% of the
Aggregate Outstandings of all Lenders.
"Requirement of Law" means as to any Person, the certificate
of incorporation and by-laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, 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" means, with respect to a Eurodollar
Interest Period for Eurodollar Loans the maximum aggregate reserve requirement
(including all basic, supplemental, marginal and other reserves) under any
regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D) maintained by a member bank of
such System.
"Section" means a numbered section of this Agreement, unless
another document is specifically referenced.
"Seller" means, collectively, LucasVarity plc, Xxxxx
Industries plc, Xxxxx France SAS, Xxxxxx-Xxxxx Company, Xxxxx Automotive GmbH
and Xxxxx Limited.
13
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" within the meaning of Rule 1-02 of the Securities and
Exchange Commission's Regulation S-X.
"Single Employer Plan" means a Plan which is maintained on or
after the Closing Date by the Company or any member of the Controlled Group for
employees of the Company or any member of the Controlled Group.
"S&P Bond Rating" means for any day, the rating of the
Company's senior long-term unsecured debt by Standard & Poor's Rating Group
("S&P") in effect at 11:00 a.m., New York City time, on such day.
"Subsidiary" of a Person means (a) any corporation more than
50% of the outstanding securities having ordinary voting power of which shall at
the time be owned or controlled, directly or indirectly, by such Person or by
one or more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (b) any partnership, limited liability company, association,
joint venture or similar business organization more than 50% of the ownership
interests having ordinary voting power of which shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references herein to a
"Subsidiary" shall mean a Subsidiary of the Company.
"Substantial Portion" means, with respect to the Property of
the Company and its Subsidiaries, Property which (a) represents more than 15% of
the consolidated assets of the Company and its Subsidiaries as would be shown in
the consolidated financial statement of the Company and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made, or (b) is responsible for more than 15% of the
consolidated net sales or of the consolidated net income of the Company and its
Subsidiaries as reflected in the financial statements referred to in clause (a)
above.
"Total Debt" means, as of the end of any fiscal quarter of the
Company, all Indebtedness of the Company and its Subsidiaries as at such date,
determined on a consolidated basis.
"Transferee" is defined in Section 11.4.
"Type" means, with respect to any Loan, its nature as a
Floating Rate Loan or a Eurodollar Loan.
"UBS" is defined in the preamble hereto.
"Unfunded Liabilities" means the amount (if any) by which the
actuarial present value of all benefit liabilities under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefit liabilities, all determined as of the then most recent valuation date
for such Plans using FASB actuarial assumptions for single employer plan
terminations.
"Unmatured Default" means an event which but for the lapse of
time or the giving of notice, or both, would constitute a Default.
14
"Volvo Acquisition" means the acquisition of Volvo Truck
Corporation's heavy truck axle manufacturing operations in Lindesberg, Sweden on
substantially the terms described in the Confidential Information Memorandum.
"WDR" is defined in the preamble hereto.
"Wholly-Owned Subsidiary" of a Person means (a) any Subsidiary
all of the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (b) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
"Year 2000 Problems" means limitations in the capacity or
readiness to handle date information for the Year 1999 or years beginning
January 1, 2000 of any of the hardware, firmware or software systems ("Systems")
associated with information processing and delivery, operations or services
(e.g., security and alarms, elevators, communications and HVAC) operated by,
provided to or otherwise reasonably necessary to the business or operations of
the Company and its Subsidiaries.
The foregoing definitions shall be equally applicable to both
the singular and plural forms of the defined terms.
ARTICLE II
----------
THE CREDITS
-----------
2.1 Commitments. Each Lender severally agrees, on the terms and conditions
set forth in this Agreement, to make a loan to the Company on the Borrowing Date
in an amount not exceeding its Commitment. The Loans may be Floating Rate Loans
or Eurodollar Loans, or a combination thereof selected in accordance with
Sections 2.3 and 2.6; provided, however, that if the Borrowing Date is on or
within 3 days after the Closing Date, the Loans shall initially be Floating Rate
Loans. Each Lender's Commitment shall expire immediately and without further
action on January 31, 1999, if the Loans are not made on or before such date
(it being understood that delivery of an appropriate Borrowing Notice in
accordance with the terms of this Agreement is a condition to the making of the
Loans). The Company may make only one borrowing under the Commitments. Amounts
borrowed under this Section 2.1 and subsequently repaid or prepaid may not be
reborrowed.
2.2 Repayment of Loans; Evidence of Debt.
2.2.1 The Company hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender (x) the then unpaid
principal amount of the Loan of such Lender on the Maturity Date, and (y) such
other amounts on such other dates as may be required to be paid from time to
time pursuant to this Agreement. The Company hereby further agrees to pay to the
15
Administrative Agent for the account of each Lender interest on the unpaid
principal amount of the Loans from time to time outstanding until payment
thereof in full at the rates per annum, and on the dates, set forth in Section
2.7.
2.2.2 Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Company to such Lender
resulting from the Loan of such Lender from time to time, including the amounts
of principal and interest payable thereon and paid to such Lender from time to
time under this Agreement.
2.2.3 The Administrative Agent shall maintain an account in its books and
records with a subaccount for each Lender, in which shall be recorded (a) the
amount of such Lender's Loan made hereunder, the Type thereof and each
Eurodollar Interest Period, if any, applicable thereto, (b) the amount of any
principal or interest due and payable or to become due and payable from the
Company to each Lender hereunder in respect of its Loan and (c) both the amount
of any sum received by the Administrative Agent hereunder from the Company in
respect of the Loans and each Lender's share thereof.
2.2.4 The books and records of the Administrative Agent and of each Lender
maintained pursuant to Section 2.2.2 and 2.2.3 shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Company therein recorded; provided, however, that the failure
of any Lender or the Administrative Agent to maintain any such books and records
or any error therein, shall not in any manner affect the obligation of the
Company to repay (with applicable interest) the Loan made to the Company by such
Lender in accordance with the terms of this Agreement.
2.2.5 The Company agrees that, upon the request to the Administrative Agent
by any Lender, the Company will execute and deliver to such Lender a promissory
note of the Company evidencing the Loan of such Lender, substantially in the
form of Exhibit D annexed hereto with appropriate insertions as to date and
principal amount (each, a "Note"); provided, that the delivery of such Notes
shall not be a condition precedent to the Closing Date.
2.3 Procedures for Borrowing. The Company may borrow once under the
Commitments on any Business Day on or before January 31, 1999; provided, that
the Company shall give the Administrative Agent an irrevocable Borrowing Notice
(which Borrowing Notice must be received by the Administrative Agent prior to
10:00 a.m., New York City time) (a) three Business Days prior to the requested
Borrowing Date, if all or any part of the requested Loans are to be initially
Eurodollar Loans, or (b) on the requested Borrowing Date, otherwise, specifying
in each case (i) the amount to be borrowed, (ii) the requested Borrowing Date,
(iii) whether the borrowing is to be of Eurodollar Loans, Floating Rate Loans or
a combination thereof and (iv) if the borrowing is to be entirely or partly of
Eurodollar Loans, the amount of such Type of Loan and the length of the initial
Eurodollar Interest Periods therefor. Each borrowing shall be in an amount equal
to (A) in the case of Floating Rate Loans, $5,000,000 or a whole multiple of
$5,000,000 in excess thereof, and (B) in the case of Eurodollar Loans,
16
$10,000,000 or a whole multiple of $5,000,000 in excess thereof. Upon receipt of
such notice from the Company, the Administrative Agent shall promptly notify
each Lender thereof. Not later than 11:00 a.m., New York City time, on the
requested Borrowing Date each Lender shall make an amount equal to its Committed
Percentage of the principal amount of the Loans requested to be made on such
Borrowing Date available to the Administrative Agent at its New York office
specified in Section 12.1 in immediately available funds. The Administrative
Agent shall on such date credit the account of the Company on the books of such
office with the aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the Administrative Agent.
The Borrowing Notice shall be irrevocable, and the Company shall be bound to
make a borrowing in accordance therewith.
2.4 Fees.
(a) The Company agrees to pay on the Closing Date to the
Administrative Agent, for distribution to each Lender in
proportion to that Lender's Committed Percentage on such date,
a participation fee equal to 0.125% multiplied by the
aggregate Commitments of all Lenders.
(b) The Company agrees to pay to the Arranger and the
Administrative Agent, in each case for their own account, such
other fees as agreed to between the Company and the Arranger
and the Administrative Agent.
2.5 Optional and Mandatory Principal Payments on All Loans.
2.5.1 The Company may at any time and from time to time prepay Floating Rate
Loans, in whole or in part, without penalty or premium, upon at least one
Business Day's irrevocable notice to the Administrative Agent, specifying the
date and amount of prepayment. If any such notice is given, the amount specified
in such notice shall be due and payable on the date specified therein. Partial
prepayment of Floating Rate Loans shall be in a minimum aggregate amount of
$5,000,000 or any integral multiple of $1,000,000 in excess thereof.
2.5.2 The Company may at any time and from time to time prepay, without
premium or penalty but upon payment of any amount payable pursuant to Section
3.4, its Eurodollar Loans in whole or in part, upon at least three Business
Days' irrevocable notice to the Administrative Agent specifying the date (which
shall be at the end of the applicable Eurodollar Interest Period) and amount of
prepayment. If any such notice is given, the amount specified in such notice
shall be due and payable on the date specified therein. Partial prepayment of
Eurodollar Loans shall be in a minimum aggregate amount of $10,000,000 or any
integral multiple of $1,000,000 in excess thereof.
2.5.3 On the date of receipt by the Company of the cash proceeds (any such
proceeds, net of underwriting discounts and commissions and other reasonable
costs and expenses associated
17
therewith, including reasonable legal fees and expenses, being "Net Securities
Proceeds") from the incurrence of any Indebtedness by the Company or any of its
Subsidiaries or the issuance of any debt or equity securities of the Company
after the Closing Date (other than proceeds from the incurrence of Excluded
Indebtedness or from Excluded Equity Issuances), the Company shall prepay the
Loans and/or the Commitments shall be permanently reduced in an aggregate amount
equal to such Net Securities Proceeds, until all Obligations have been paid in
full. Concurrently with any prepayment of the Loans and/or reduction of the
Commitments pursuant to this Section 2.5.3, the Company shall deliver to the
Administrative Agent an Officer's Certificate demonstrating the calculation of
the amount of the applicable Net Securities Proceeds that gave rise to such
prepayment and/or reduction. In the event that the Company shall subsequently
determine that the actual Net Securities Proceeds amount was greater than the
amount set forth in such Officer's Certificate, the Company shall promptly make
an additional prepayment of the Loans in an amount equal to the amount of such
excess, and the Company shall concurrently therewith deliver to the
Administrative Agent an Officer's Certificate demonstrating the derivation of
the additional Net Securities Proceeds amount resulting in such excess.
2.5.4 Each prepayment and conversion pursuant to this Section 2.5 shall be
accompanied by accrued and unpaid interest on the amount prepaid to the date of
prepayment and any amounts payable under Section 3.4 in connection with such
payment.
2.5.5 Mandatory prepayments pursuant to this Section 2.5 shall be applied
first to prepay Floating Rate Loans and second to prepay Eurodollar Loans then
outstanding in such order as the Company may direct.
2.6 Conversion and Continuation of Outstanding Loans. Floating Rate Loans
shall continue as Floating Rate Loans unless and until such Floating Rate Loans
are converted into Eurodollar Loans. Each Eurodollar Loan shall continue as a
Eurodollar Loan until the end of the then applicable Eurodollar Interest Period
therefor, at which time such Eurodollar Loan shall be automatically converted
into a Floating Rate Loan unless the Company shall have given the Administrative
Agent a Conversion/Continuation Notice requesting that, at the end of such
Eurodollar Interest Period, such Eurodollar Loan either continue as a Eurodollar
Loan for the same or another Eurodollar Interest Period or be converted into a
Floating Rate Loan. Subject to the terms hereof, the Company may elect from time
to time to convert all or any part of a Loan of any Type into any other Type or
Types of Loans; provided that any conversion of a Eurodollar Loan shall be made
on, and only on, the last day of the Eurodollar Interest Period applicable
thereto. Notwithstanding anything herein to the contrary, no Loan may be
converted to a Eurodollar Loan, and no Eurodollar Loan may be continued as such,
if any Default or Unmatured Default has occurred and is continuing. The Company
shall give the Administrative Agent irrevocable notice substantially in the form
of Exhibit C annexed hereto (a "Conversion/Continuation Notice") of each
conversion of a Loan or continuation of a Eurodollar Loan not later than 10:00
a.m. (New York City time) at least one Business Day, in the case of a conversion
into a Floating Rate Loan or three Business Days, in the case of a conversion
into or
18
continuation of a Eurodollar Loan, prior to the date of the requested conversion
or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Loan which is to be
converted or continued, and
(iii) the amounts and Type(s) of Loan(s) into which such Loan is to
be converted or continued and, in the case of a conversion
into or continuation of a Eurodollar Loan, the duration of the
Eurodollar Interest Period applicable thereto.
2.7 Interest Rates, Interest Payment Dates; Interest and Fee Basis. (a)
Each Floating Rate Loan shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Loan is made or is
converted from a Eurodollar Loan into a Floating Rate Loan pursuant to Section
2.6 to but excluding the date it becomes due or is converted into a Eurodollar
Loan pursuant to Section 2.6 hereof, at a rate per annum equal to the Floating
Rate for such day. Each Eurodollar Loan shall bear interest for each day during
each Eurodollar Interest Period with respect thereto at a rate per annum equal
to the Eurodollar Rate determined for such Eurodollar Interest Period.
(b) Interest accrued on each Floating Rate Loan shall be
payable on each Payment Date, commencing with the first such date to
occur after the date hereof and at maturity. Interest accrued on each
Eurodollar Loan shall be payable on the last day of its applicable
Eurodollar Interest Period, on any date on which the Eurodollar Loan is
prepaid, whether by acceleration or otherwise, and at maturity.
(c) Interest shall be payable for the day a Loan is made but
not for the day of any payment on the amount paid if payment is
received prior to noon (local time) at the place of payment. If any
payment of principal of or interest on a Loan shall become due on a day
which is not a Business Day, except as otherwise provided in the
definition of Eurodollar Interest Period, such payment shall be made on
the next succeeding Business Day and, in the case of a principal
payment, such extension of time shall be included in computing interest
in connection with such payment.
(d) All interest and fees shall be computed on the basis of
the actual number of days (including the first day but excluding the
last day) occurring during the period such interest or fee is payable
over a year comprised of 360 days (or in the case of interest on
Floating Rate Loans, 365 days or, if appropriate, 366 days).
2.8 Changes in Interest Rate, etc. Changes in the rate of interest on that
portion of any Loan maintained as a Floating Rate Loan will take effect
simultaneously with each change in the
19
Alternate Base Rate. Each Eurodollar Loan shall bear interest on the outstanding
principal amount thereof from and including the first day of the Eurodollar
Interest Period applicable thereto to (but not including) the last day of such
Eurodollar Interest Period at the interest rate determined as applicable to such
Eurodollar Loan. No Eurodollar Interest Period may end after the Maturity Date.
2.9 Rates Applicable After Default. Notwithstanding anything to the
contrary contained in this Article II, during the continuance of a Default the
Required Lenders may, at their option, by notice to the Company (which notice
may be revoked at the option of the Required Lenders notwithstanding any
provision of Section 8.2 requiring unanimous consent of the Lenders to changes
in interest rates), declare that no Loan may be made as, converted into or
continued (after the expiration of the current Eurodollar Interest Period) as a
Eurodollar Loan. If any Loan is not paid at maturity, whether by acceleration or
otherwise, the Required Lenders may, at their option, by notice to the Company
(which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders as to changes in interest rates) declare that (i) each Eurodollar Loan
shall bear interest (including interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding relating to the Company, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) for the remainder of
the applicable Eurodollar Interest Period at the rate per annum otherwise
applicable to such Eurodollar Interest Period plus 2% per annum and (ii) each
Floating Rate Loan shall bear interest (including interest accruing after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding relating to the Company, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
at a rate per annum equal to the Floating Rate otherwise applicable to Floating
Rate Loans plus 2% per annum.
2.10 Pro Rata Payment, Method of Payment.
2.10.1 The borrowing of Loans by the Company from the Lenders shall be made
pro rata according to the Committed Percentages of the Lenders in effect on the
Borrowing Date. Each payment (other than any optional prepayment) by the Company
on account of principal of or interest on the Loans shall be allocated by the
Administrative Agent pro rata amongst the Lenders according to the respective
outstanding principal amounts thereof then due and owing to each Lender. Each
optional prepayment by the Company on account of principal or interest on the
Loans shall be allocated by the Administrative Agent pro rata according to the
respective outstanding principal amounts thereof. All payments (including
prepayments) to be made by the Company hereunder, whether on account of
principal, interest, fees or otherwise, shall be made, without setoff,
deduction, or counterclaim, in immediately available funds to the Administrative
Agent at the Administrative Agent's address specified pursuant to Article XII,
or at any other Lending Office of the Administrative Agent specified in writing
by the Administrative Agent to the Company, by 12:00 p.m. (New York City time)
on the date of payment. All payments hereunder shall be made in U.S. Dollars.
Each payment delivered to the Administrative Agent for the account of any Lender
shall be delivered promptly by the Administrative Agent to such
20
Lender in the same type of funds that the Administrative Agent received at its
address specified pursuant to Article XII or at any Lending Office specified in
a notice received by the Administrative Agent from such Lender. The
Administrative Agent is hereby authorized to charge the account of the Company
maintained with UBS for each payment of principal, interest and fees as it
becomes due hereunder.
2.11 Telephonic Notices. The Company hereby authorizes the Lenders and the
Administrative Agent to extend, convert or continue Loans, effect selections of
Types of Loans and to transfer funds based on telephonic notices made by any
person or persons the Administrative Agent or any Lender reasonably and in good
faith believes to be an Authorized Officer. The Company agrees to deliver
promptly to the Administrative Agent a written confirmation, if such
confirmation is requested by the Administrative Agent or any Lender, of each
telephonic notice signed by an Authorized Officer. If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the Lenders
shall govern absent manifest error.
2.12 Notification of Loans, Interest Rates, Prepayments and Commitment
Reductions. Promptly after receipt thereof, the Administrative Agent will notify
each Lender of the contents of each Borrowing Notice, Conversion/Continuation
Notice, and repayment notice received by it hereunder. The Administrative Agent
will notify each Lender of the interest rate applicable to each Eurodollar Loan
promptly upon determination of such interest rate and will give each Lender
prompt notice of each change in the Alternate Base Rate. Each Reference Lender
agrees to furnish timely information for the purpose of determining the
applicable interest rates.
2.13 Lending Offices. Each Lender may book its Loans at any Lending Office
selected by such Lender and may change its Lending Office from time to time. All
terms of this Agreement shall apply to any such Lending Office and the Notes, if
any, shall be deemed held by each Lender for the benefit of such Lending Office.
Each Lender may, by written or telex notice to the Administrative Agent and the
Company, designate a Lending Office through which Loans will be made by it and
for whose account Loan payments are to be made.
2.14 Non-Receipt of Funds by the Administrative Agent. Unless the Company or
a Lender, as the case may be, notifies the Administrative Agent prior to the
date on which it is scheduled to make payment to the Administrative Agent of (a)
in the case of a Lender, the proceeds of a Loan or (b) in the case of the
Company, a payment of principal, interest or fees to the Administrative Agent
for the account of the Lenders, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Company, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall, on
demand by the Administrative Agent, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date such amount was so made available by the
Administrative Agent until
21
the date the Administrative Agent recovers such amount at a rate per annum equal
to (i) in the case of payment by a Lender, the Federal Funds Effective Rate for
such day or (ii) in the case of payment by the Company, the interest rate
applicable to the relevant Loan.
2.15 Application of Payments with Respect to Defaulting Lenders. No
payments of principal, interest or fees delivered to the Administrative Agent
for the account of any Defaulting Lender shall be delivered by the
Administrative Agent to such Defaulting Lender. Instead, such payments shall,
for so long as such Defaulting Lender shall be a Defaulting Lender, be held by
the Administrative Agent, and the Administrative Agent is hereby authorized and
directed by all parties hereto to hold such funds in escrow and apply such funds
to the Loan required to be made by such Defaulting Lender on the Borrowing Date
to the extent such Lender fails to make such Loan. Notwithstanding the
foregoing, upon the termination of the Commitments and the payment and
performance of all of the Obligations (other than those owing to a Defaulting
Lender), any funds then held in escrow by the Administrative Agent pursuant to
the preceding sentence shall be distributed to each Defaulting Lender, pro rata
in proportion to amounts that would be due to each Defaulting Lender but for the
fact that it is a Defaulting Lender.
ARTICLE III
-----------
CHANGE IN CIRCUMSTANCES, TAXES
------------------------------
3.1 Yield Protection. If after the date hereof any law or any governmental
or quasi-governmental rule, regulation, policy, guideline or directive (whether
or not having the force of law), or any change or modification thereof, or any
interpretation thereof, or the compliance of any Lender therewith,
(a) subjects any Lender or any applicable Lending Office to any
tax, duty, charge or withholding on or from payments due from
the Company or changes the basis of taxation of payments to
any Lender in respect of its Loans or other amounts due it
hereunder (excluding income taxes and franchise taxes (imposed
in lieu of income taxes)) imposed on the Administrative Agent
or any Lender as a result of a present or former connection
between the Administrative Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax
or any political subdivision or taxing authority thereof or
therein, other than any such connection arising solely from
the Administrative Agent or such Lender having executed,
delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan
Document), or
(b) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender or any
applicable Lending Office (other than reserves and assessments
taken into account in determining the interest rate applicable
to Eurodollar Loans), or
22
(c) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Office of
making, funding or maintaining loans or reduces any amount
receivable by any Lender or any applicable Lending Office in
connection with loans, or requires any Lender or any
applicable Lending Office to make any payment calculated by
reference to the amount of loans held or interest received by
it, by an amount deemed material by such Lender,
then, within 15 days of demand by such Lender, the Company shall pay such Lender
that portion of such increased expense incurred or reduction in an amount
received which such Lender determines is attributable to making, funding and
maintaining its Loan or its Commitment.
3.2 Changes in Capital Adequacy Regulations. If a Lender determines the
amount of capital required or expected to be maintained by such Lender, any
Lending Office of such Lender or any corporation controlling such Lender is
increased as a result of a Change (as defined below), then, within 15 days of
demand by such Lender, the Company shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender determines is attributable to this
Agreement, its Loan or its obligation to make its Loan hereunder (after taking
into account such Lender's policies as to capital adequacy). "Change" means (a)
any change after the date of this Agreement in the Risk-Based Capital Guidelines
or (b) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or any Lending Office or any corporation controlling
any Lender. "Risk-Based Capital Guidelines" means (i) the risk-based capital
guidelines in effect in the United States on the date of this Agreement,
including transition rules, and (ii) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the
July 1988 report of the Basle Committee on Banking Regulation and Supervisory
Practices Entitled "International Convergence of Capital Measurements and
Capital Standards," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement.
3.3 Availability of Types of Loans. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Office would violate
any applicable law, rule, regulation, or directive, whether or not having the
force of law, or if the Required Lenders with respect to Eurodollar Loans
determine that (i) deposits of a type and maturity appropriate to match fund
Eurodollar Loans are not available or (ii) the interest rate applicable to a
Eurodollar Loan does not accurately reflect the cost of making or maintaining
such Loans, then the Administrative Agent shall suspend the availability of the
affected Eurodollar Loans and require any affected Eurodollar Loans to be repaid
at the end of the Eurodollar Interest Period for the affected Loans.
3.4 Funding Indemnification. If any payment of a Eurodollar Loan occurs on
a date which is not the last day of the applicable Eurodollar Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar Loan
is not made on the date specified by the Company
23
for any reason other than default by the Lenders, the Company will indemnify
each Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain the Eurodollar Loan.
3.5 Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Office with respect
to its Eurodollar Loans to reduce any liability of the Company to such Lender
under Sections 3.1 and 3.2 or to avoid the unavailability of a Type of Loan
under Section 3.3, so long as such designation is not disadvantageous to such
Lender in any material respect. Each Lender shall deliver a written statement of
such Lender to the Company (with a copy to the Administrative Agent) as to the
amount due, if any, under Section 3.1, 3.2 or 3.4. Such written statement shall
set forth in reasonable detail the calculations upon which such Lender
determined such amount and shall state that amounts determined in accordance
with such procedures are being charged by such Lender to other borrowers with
credit facilities similar to this Agreement and credit characteristics
comparable to the Company as determined by such Lender and shall be final,
conclusive and binding on the Company in the absence of manifest error.
Determination of amounts payable under such sections in connection with
Eurodollar Loans shall be calculated as though each Lender funded such Loans
through the purchase of a deposit of the type and maturity corresponding to the
deposit used as a reference in determining the interest rate applicable to such
Loan, whether in fact that is the case or not. Unless otherwise provided herein,
the amount specified in the written statement of any Lender shall be payable on
demand after receipt by the Company of such written statement. The obligations
of the Company under Sections 3.1, 3.2, 3.4 and 3.6 shall survive payment of the
Obligations and termination of this Agreement. The Company shall have no
obligation to compensate any Lender with respect to amounts provided in Section
3.1, 3.2, 3.4 or 3.6 with respect to any period prior to the date which is 120
days prior to the date such Lender delivers its written statement hereunder
requesting compensation.
3.6 Taxes.
3.6.1 All payments of principal and interest made by the Company under this
Agreement and any Note, if any, 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, excluding income taxes and franchise taxes
(imposed in lieu of income taxes) imposed on the Administrative Agent or any
Lender as a result of a present or former connection between the Administrative
Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision or taxing authority thereof or therein
(other than any such connection arising solely from the Administrative Agent or
such Lender having executed, delivered or performed its obligations or received
a payment under, or enforced, this Agreement or any other Loan Document). If any
such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the
24
Administrative Agent, or any Lender hereunder or under any Note, the amounts so
payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates and in the amounts specified in this Agreement; provided,
however, that the Company shall not be required to increase any such amounts
payable to any Lender that is not organized under the laws of the United States
of America or a state thereof if such Lender fails to comply with the
requirements of Section 3.6.2. Whenever any Non-Excluded Taxes are payable by
the Company, as promptly as possible thereafter the Company shall send to the
Administrative Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt received by
the Company showing payment thereof. If the Company fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence, the Company shall indemnify the Administrative Agent and
the Lenders for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any such
failure. The agreements in this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
3.6.2 Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(a) at least five Business Days before the date of the initial
payment to be made by the Company under this Agreement to such
Lender, deliver to the Company and the Administrative Agent
(A) two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224, or successor applicable
form, as the case may be, certifying that it is entitled to
receive payments under this Agreement without deduction or
withholding of any United States federal income taxes or (B)
in the event such Lender is not a "bank" or other Person
described in Section 881(c)(3) of the Code and cannot deliver
the documents described in clause (A), a duly completed copy
of Internal Revenue Service Form W-8, or successor applicable
form, certifying that it is entitled to an exemption from
United States backup withholding tax and a certificate
substantially in the form of Exhibit I annexed hereto;
(b) deliver to the Company and the Administrative Agent two
further copies of any such form or certification at least five
Business Days before the date that any such form or
certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent
form previously delivered by it to the Administrative Agent
and the Company;
(c) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the
Company or the Administrative Agent; and
25
(d) file amendments to such forms as and when required; and each
Lender (or Transferee) that is incorporated or organized under
the laws of the United States of America or a State thereof
shall provide two properly completed and duly executed copies
of Form W-9, or successor applicable form, at the times
specified for delivery of forms under this Section 3.6.2
unless an event (including, without limitation, any change in
treaty, law or regulation) has occurred after the date such
Person becomes a Lender hereunder which renders all such forms
inapplicable or which would prevent such Lender from duly
completing and delivering any such form with respect to it and
such Lender so advises the Company and the Administrative
Agent; provided, however, that the Company may rely upon such
forms provided to the Company for all periods prior to the
occurrence of such event. Each Person that shall become a
Lender or a Participant pursuant to Section 11.2 shall, upon
the effectiveness of the related transfer, be required to
provide all of the forms, certifications and statements
required pursuant to this Section, provided that in the case
of such Participant, the obligations of such Participant
pursuant to this Section 3.6.2 shall be determined as if such
Participant were a Lender, except that such Participant shall
furnish all such required forms, certifications and statements
to the Lender from which the related participation shall have
been purchased.
3.6.3 Each Lender agrees to use reasonable efforts to avoid or to minimize
any amounts which might otherwise be payable pursuant to this Section 3.6,
provided that such effort shall not impose on any such Lender any additional
costs or legal or regulatory burdens deemed by such Lender in its reasonable
judgment to be material. In the event that any Lender determines that any event
or circumstance that will lead to a claim by it under this Section 3.6 has
occurred or will occur; such Lender will use its best efforts to so notify the
Company in writing, provided that any failure to provide such notice shall in no
way impair the rights of any Lender to demand and receive compensation under
this Section 3.6.
3.7 Substitution of Lender. If (a) the obligation of any Lender to make or
maintain Eurodollar Loans has been suspended pursuant to Section 3.3 when not
all Lenders' obligations have been suspended, (b) any Lender has demanded
compensation under Section 3.1 or 3.2 when all Lenders have not done so or (c)
any Lender is a Defaulting Lender, the Company shall have the right, if no
Default then exists, to replace such Lender (a "Replaced Lender") with one or
more other lenders (collectively, the "Replacement Lender") acceptable to the
Administrative Agent, provided that (i) at the time of any replacement pursuant
to this Section 3.7, the Replacement Lender shall enter into one or more
Assignments pursuant to which the Replacement Lender shall acquire the
Commitments and outstanding Loans and other obligations of the Replaced Lender
and, in connection therewith, shall pay to the Replaced Lender in respect
thereof an amount equal to the sum of (A) the amount of principal of, and all
accrued interest on, all outstanding Loans of the Replaced Lender, (B) the
amount of all accrued, but theretofore unpaid, fees owing to the Replaced Lender
hereunder and (C) the amount which would be payable by the Company to the
Replaced Lender pursuant to Section 3.4, if any, if the Company
26
prepaid at the time of such replacement all of the Loans of such Replaced Lender
outstanding at such time and (ii) all obligations of the Company then owing to
the Replaced Lender (other than those specifically described in clause (i) above
in respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Lender concurrently with
such replacement. Upon the execution of the respective Assignments, the payment
of amounts referred to in clauses (i) and (ii) above and, if so requested by the
Replacement Lender, delivery to the Replacement Lender of the appropriate Note
or Notes executed by the Company, the Replacement Lender shall become a Lender
hereunder and the Replaced Lender shall cease to constitute a Lender hereunder.
The provisions of this Agreement (including without limitation Sections 3.4 and
9.7) shall continue to govern the rights and obligations of a Replaced Lender
with respect to any Loans made or any other actions taken by such lender while
it was a Lender. Nothing herein shall release any Defaulting Lender from any
obligation it may have to the Company, the Arranger, the Administrative Agent or
any other Lender.
ARTICLE IV
----------
CONDITIONS PRECEDENT
--------------------
4.1 Closing Date Conditions. The effectiveness of this Agreement is subject
to the satisfaction of the following conditions:
4.1.1 Corporate Documents. On the Closing Date, the Company shall furnish
to the Administrative Agent, with sufficient copies for the Lenders, each of the
following:
(a) Copies of the certificate of incorporation of the Company,
together with all amendments thereto, and a certificate of
good standing or similar governmental evidence of corporate
existence, all certified by the Secretary or an Assistant
Secretary of the Company.
(b) Copies, certified by the Secretary or an Assistant Secretary
or other duly authorized representative of the Company, of its
by-laws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are deemed necessary by
counsel for the Administrative Agent) authorizing the
execution of the Loan Documents.
(c) An incumbency certificate, executed by the Secretary or an
Assistant Secretary of the Company, which shall identify by
name and title and bear the signature of the officers of the
Company authorized to sign the applicable Loan Documents and
to make borrowings hereunder, upon which certificate the
Administrative Agent and the Lenders shall be entitled to rely
until informed of any change in writing by the Company.
27
(d) Such other documents as the Administrative Agent or its
counsel may have reasonably requested.
4.1.2 Financial Statements; Pro Forma Balance Sheet; Projections. On or
before the Closing Date, the Agent and the Lenders shall have received from the
Company (i) audited financial statements of the Company and its Subsidiaries for
its fiscal year ending September 30, 1998, consisting of a balance sheet and the
related consolidated statements of income, stockholders' equity and cash flows
for such fiscal year, (ii) a pro forma consolidated balance sheet of the Company
and its Subsidiaries as at December 31, 1998 as contained in the Confidential
Information Memorandum and as modified by the letter from the Company to S&P and
Xxxxx'x dated December 4, 1998 (the "Pro Forma Balance Sheet"), prepared in
accordance with Agreement Accounting Principles and reflecting the consummation
of the LucasVarity Acquisition, the Volvo Acquisition and the Euclid
Acquisition, the related financing and the other transactions contemplated by
the Loan Documents, which Pro Forma Balance Sheet shall be in form and substance
satisfactory to Lenders, and (iii) projections of the Company and its
Subsidiaries for the period from September 30, 1999 through September 30, 2001
as presented on November 30 and December 1, 1998 to S&P and Xxxxx'x and as
modified by the letter from the Company to such rating agencies dated December
4, 1998 (the "Projections"), prepared in accordance with Agreement Accounting
Principles and reflecting the consummation of the LucasVarity Acquisition, the
Volvo Acquisition and the Euclid Acquisition, the related financings and the
other transactions contemplated by the Loan Documents, which Projections shall
be in form and substance satisfactory to Lenders.
4.1.3 Fees. On the Closing Date, the Company shall have paid to the
Administrative Agent, for distribution (as appropriate) to the Arranger, the
Administrative Agent and the Lenders, the fees payable on the Closing Date
referred to in Section 2.4.
4.1.4 Opinion of Counsel to Company. On the Closing Date, Lenders shall have
received (a) written opinions of the general counsel of the Company and of
Xxxxxxxxxx & Xxxxx LLP, counsel to the Company, addressed to the Lenders and
dated the Closing Date, in substantially the forms of Exhibit F-1 and Exhibit
F-2 annexed hereto respectively, and (b) evidence satisfactory to the
Administrative Agent that the Company has requested such counsel to deliver such
opinions to Lenders.
4.1.5 Opinion of Counsel to Arranger and Administrative Agent. On the Closing
Date, Lenders shall have received a written opinion of O'Melveny & Xxxxx LLP,
counsel to the Arranger and the Administrative Agent, addressed to the Lenders
and dated the Closing Date, in substantially the form of Exhibit G annexed
hereto.
4.1.6 Acquisition Documents. The Administrative Agent and, if requested by
any Lender, each such Lender shall have received a fully executed or conformed
copy of the LucasVarity Acquisition Agreement and all documentation relating
thereto in effect on the Closing Date. Each such agreement shall be in full
force and effect.
28
4.1.7 Officer's Certificate. (a) The representations and warranties contained
in Article V shall be true and correct as of the Closing Date except to the
extent any such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall be true and
correct on and as of such earlier date, (b) the Company shall have performed in
all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before the
Closing Date except as otherwise disclosed to and agreed to in writing by the
Administrative Agent and Required Lenders, (c) no Default or Unmatured Default
shall have occurred and be continuing, and (d) the Company shall have delivered
to the Administrative Agent an Officer's Certificate, in form and substance
satisfactory to the Administrative Agent, to the effect set forth in clauses (a)
through (c) above.
4.1.8 Completion of Proceedings. All corporate and other proceedings taken or
to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by the
Administrative Agent, acting on behalf of Lenders, and its counsel shall be
satisfactory in form and substance to the Administrative Agent and such counsel.
4.2 Conditions to Borrowing Date. The obligations of the Lenders to make
the Loans on the Borrowing Date are, in addition to the conditions precedent
specified in Section 4.1, subject to satisfaction of the following conditions:
(a) Use of Proceeds. On or before the Borrowing Date, the
Administrative Agent shall have received evidence satisfactory
to the Administrative Agent that the proceeds of the Loans
have been irrevocably committed to the payment of a portion of
the LucasVarity Acquisition Financing Requirements.
(b) No Amendment to Acquisition Documents. No provision of the
LucasVarity Acquisition Agreement or any of the documents
executed in connection therewith shall have been modified or
waived in any manner that is materially adverse to the Lenders
without the consent of the Administrative Agent and Required
Lenders.
(c) Existing Indebtedness. The Administrative Agent shall have
received an Officer's Certificate of the Company stating that,
after giving effect to the funding and application of the
Loans and the consummation of the LucasVarity Acquisition, all
Indebtedness of the Company and its Subsidiaries that is not
permitted under this Agreement shall have been paid in full,
redeemed or defeased, any commitments to lend thereunder shall
have terminated, all letters of credit shall have expired or
been canceled and all Liens other than Liens permitted to
remain outstanding pursuant to Section 6.14 shall have been
released or terminated.
(d) Necessary Governmental Authorizations and Consents; Expiration
of Waiting Periods, Etc. Company shall have obtained all
Governmental Authorizations and
29
all consents of other Persons, in each case that are necessary
or advisable in connection with the LucasVarity Acquisition,
the other transactions contemplated by the Loan Documents, and
the continued operation of the business conducted by the
Acquired Division in substantially the same manner as
conducted prior to the consummation of the LucasVarity
Acquisition, and each of the foregoing shall be in full force
and effect, in each case other than those the failure to
obtain or maintain which, either individually or in the
aggregate, would not reasonably be expected to have a Material
Adverse Effect. All applicable waiting periods shall have
expired without any action being taken or threatened by any
competent authority which would restrain, prevent or otherwise
impose adverse conditions on the LucasVarity Acquisition or
the financing thereof No action, request for stay, petition
for review or rehearing, reconsideration, or appeal with
respect to any of the foregoing shall be pending, and the time
for any applicable agency to take action to set aside its
consent on its own motion shall have expired.
(e) Consummation of Acquisition.
(i) All conditions to the LucasVarity Acquisition set
forth in the LucasVarity Acquisition Agreement shall
have been satisfied or the fulfillment of any such
conditions shall have been waived with the consent of
Administrative Agent and Required Lenders, except for
such conditions the waiver of or failure to satisfy
which are not materially adverse to the Lenders;
(ii) The aggregate cash consideration paid to Seller in
connection with the LucasVarity Acquisition shall not
exceed $400,000,000 (excluding post-closing working
capital adjustments not to exceed $20,000,000); and
(iii) The Administrative Agent shall have received an
Officer's Certificate of the Company to the effect
set forth in clauses (i) and (ii) above and stating
that (x) the LucasVarity Acquisition Agreement has
not been amended, modified or otherwise supplemented
since the Closing Date in any manner which is
materially adverse to the Lenders (other than with
the consent of the Administrative Agent and the
Required Lenders) and (y) the Company will consummate
the LucasVarity Acquisition on the Borrowing Date
immediately upon the making of the Loans.
(f) Officer's Certificate. (i) The representations and warranties
contained in Article V shall be true and correct as of the
Borrowing Date except to the extent any such representation or
warranty is stated to relate solely to an earlier date, in
which case such representation or warranty shall be true and
correct on and as of such earlier date, (ii) the Company shall
have performed in all material respects all agreements and
satisfied all conditions which this Agreement provides shall
be performed or satisfied by it on or before the Borrowing
Date except as otherwise
30
disclosed to and agreed to in writing by the Administrative
Agent and Required Lenders, (iii) no Default or Unmatured
Default shall have occurred and be continuing, and (iv) the
Company shall have delivered to the Administrative Agent an
Officer's Certificate, in form and substance satisfactory to
the Administrative Agent, to the effect set forth in clauses
(i) through (iii) above.
(g) Legal Matters. All legal matters incident to the making of
such Loans shall be satisfactory to the Administrative Agent
and its counsel, and no injunction or other restraining order
shall have been issued.
The Borrowing Notice with respect to the borrowing by the
Company hereunder shall constitute a representation and warranty by the Company
that the conditions contained in Sections 4.1 and 4.2 have been satisfied.
ARTICLE V
---------
REPRESENTATIONS AND WARRANTIES
------------------------------
The Company represents and warrants to the Lenders on the
Closing Date and on the Borrowing Date that:
5.1 Corporate Existence and Standing. Each of the Company and its
Subsidiaries is a corporation, partnership, limited liability company or other
organization, duly organized and validly existing under the laws of its
jurisdiction of organization and has all requisite corporate, partnership,
company or similar authority to conduct its business as presently conducted.
5.2 Authorization and Validity. The Company has the corporate power and
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by the Company of
the Loan Documents and the performance of its obligations thereunder have been
duly authorized by proper corporate proceedings, and the Loan Documents to which
it is a party constitute legal, valid and binding obligations of the Company
enforceable against the Company in accordance with their terms, except as
enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and by equitable
principles affecting the availability of specific performance and other
remedies.
5.3 No Conflict; Government Consent. Neither the execution and delivery by
the Company of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
any law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on the Company or any of its Subsidiaries or the Company's or any
Subsidiary's articles of incorporation or by-laws or the provisions of any
indenture, instrument or agreement to which the Company or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in the
creation or imposition of any Lien (other than any Lien permitted by
31
Section 6.14) in, of or on the Property of the Company or a Subsidiary pursuant
to the terms of any such indenture, instrument or agreement, except for any such
violation, conflict or default as would not reasonably be expected to have a
Material Adverse Effect. No order, consent, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by, or
other action in respect of any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection with
the execution, delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
5.4 Financial Statements. The September 30, 1998 consolidated financial
statements of the Company and its Subsidiaries heretofore delivered to the
Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Company and
its Subsidiaries at such date and the consolidated results of their operations
for the period then ended. The Pro Forma Balance Sheet fairly presents the pro
forma consolidated financial condition of the Company and its Subsidiaries after
giving effect to the LucasVarity Acquisition, the Volvo Acquisition and the
Euclid Acquisition and the financings contemplated by this Agreement in
accordance with generally accepted accounting principles and was prepared in
accordance with the applicable requirements of Rule 11-2 of the Securities and
Exchange Commission's Regulation S-X, including without limitation containing
reasonable assumptions and giving appropriate effect to those assumptions. The
Projections are based on estimates and assumptions considered reasonable by the
Company's management and the best information available to the Company's
management at the time made, and use information consistent with the plans of
the Company. However, the Projections are inherently subject to significant
business, economic and competitive uncertainties and contingencies, all of which
are difficult to predict and many of which are beyond the control of the
Company. Accordingly, there can be no assurance that the projected results will
be realized or that actual results will not be significantly lower or higher
than those projected.
5.5 Material Adverse Change. As of the Closing Date and the Borrowing Date,
since September 30, 1998, there has been no change in the business, Property,
prospects, condition (financial or otherwise) or results of operations of the
Acquired Division or of the Company and its Subsidiaries which could reasonably
be expected to have a Material Adverse Effect.
5.6 Taxes. The Company and its Subsidiaries have filed all United States
federal tax returns and all other tax returns which are required to be filed and
have paid all taxes shown as due pursuant to said returns or pursuant to any
assessment received by the Company or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith and as to which adequate
reserves have been provided in accordance with Agreement Accounting Principles
and as to which no Lien (other than as permitted by Section 6.14) exists and
such failures to file or pay, if any, as would not reasonably be expected to
have a Material Adverse Effect. No tax liens have been filed and no claims are
being asserted with respect to any such taxes, other than as
32
permitted by Section 6.14. The charges, accruals and reserves on the books of
the Company and its Subsidiaries in respect of any taxes or other governmental
charges are adequate.
5.7 Litigation and Contingent Obligations. Except as set forth on Schedule
5.7 annexed hereto, there is no litigation, arbitration or proceeding pending
or, to the knowledge of any of their executive officers, any governmental
investigation or inquiry pending or any litigation, arbitration, governmental
investigation, proceeding or inquiry threatened against or affecting the Company
or any of its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect or which seeks to prevent, enjoin or delay the making of the
Loans. Other than any liability incident to such litigation, arbitration or
proceedings, the Company and its Subsidiaries have no material contingent
obligations not provided for or disclosed in the financial statements referred
to in Section 5.4.
5.8 Subsidiaries. Schedule 5.8 annexed hereto contains an accurate list of
all Subsidiaries of the Company as of the date of this Agreement (giving effect
to the LucasVarity Acquisition as if it occurred on the date hereof), setting
forth their respective jurisdictions of incorporation and the percentage of
their respective capital stock owned by the Company or other Subsidiaries. All
of the issued and outstanding shares of capital stock of such Subsidiaries held
by the Company have been duly authorized and issued and are fully paid and
non-assessable.
5.9 ERISA. Each member of the Controlled Group has fulfilled its
obligations under the minimum funding standards of ERISA and the Code with
respect to each Plan. Each member of the Controlled Group is in compliance with
the applicable provisions of ERISA and the Code with respect to each Plan except
where such non compliance would not have a Material Adverse Effect. Each Plan
complies in all material respects with all applicable requirements of law and
regulations, no Reportable Event which has or may result in any material
liability has occurred with respect to any Plan, and no steps have been taken to
reorganize or terminate any Single Employer Plan. No member of the Controlled
Group has (i) sought a waiver of the minimum funding standard under Section 412
of the Code in respect of any Plan, (ii) failed to make any contribution or
payment to any Single Employer Plan or Multiemployer Plan, or made any amendment
to any Plan, which has resulted or could result in the imposition of a Lien or
the posting of a bond or other security under ERISA or the Code or (iii)
incurred any material, actual liability under Title IV of ERISA other than a
liability to the PBGC for premiums under Section 4007 of ERISA.
5.10 Accuracy of Information. No information, exhibit or report furnished by
the Company or any of its Subsidiaries in writing to the Administrative Agent or
to any Lender in connection with the negotiation of the Loan Documents contained
any material misstatement of fact or omitted to state a material fact or any
fact necessary to make the statements contained therein not misleading in light
of the circumstances in which made, as of the date thereof.
33
5.11 Regulation U. Margin Stock constitutes less than 25% of those assets of
the Company and its Subsidiaries which are subject to any limitation on sale,
pledge, or other restriction hereunder.
5.12 Material Agreements. Neither the Company nor any Subsidiary is a party
to any agreement or instrument or subject to any charter or other corporate
restriction which could reasonably be expected to have a Material Adverse
Effect. Neither the Company nor any Subsidiary is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any agreement to which it is a party (including any agreement or
instrument evidencing or governing Indebtedness), which default could reasonably
be expected to have a Material Adverse Effect.
5.13 Compliance With Laws. The Company and its Subsidiaries have complied
with all applicable statutes, rules, regulations, orders and restrictions of any
domestic or foreign government or any instrumentality or agency thereof, having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Property if failure to comply could reasonably be expected to
have a Material Adverse Effect.
5.14 Plan Assets; Prohibited Transactions. The Company and its Subsidiaries
have not engaged in any prohibited transaction within the meaning of Section
4.06 of ERISA or Section 4975 of the Code which could result in any material
liability; and neither the execution of this Agreement nor the making of Loans
(assuming that the Lenders do not fund any of the Loans with any "plan assets"
as defined above) hereunder give rise to a non-exempt prohibited transaction
within the meaning of Section 406 of ERISA or Section 4975 of the Code.
5.15 Environmental Matters. In the ordinary course of its business, the
officers of the Company consider the effect of Environmental Laws on the
business of the Company and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Company
and its Subsidiaries due to Environmental Laws. On the basis of this
consideration, the Company has reasonably concluded that Environmental Laws
cannot reasonably be expected to have a Material Adverse Effect. Neither the
Company nor any Subsidiary has received any notice to the effect that its
operations are not in material compliance with any of the requirements of
applicable Environmental Laws or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
release of any toxic or hazardous waste or substance into the environment, which
non-compliance or remedial action could reasonably be expected to have a
Material Adverse Effect.
5.16 Investment Company Act. The Company is not an "investment company" or a
company "controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
34
5.17 Public Utility Holding Company Act. The Company is not a "holding
company" or a "subsidiary company" of a "holding company, or an "affiliate" of a
"holding company" or of a "subsidiary company" of a "holding company," within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
5.18 Related Agreements.
(a) The Company has delivered to the Administrative Agent and
complete and correct copies of the LucasVarity Acquisition
Agreement and of all exhibits and schedules thereto other than
copies of any amendments or supplements thereto since the
Closing Date that are not material, in which case the Company
agrees to deliver a correct and complete copy thereof to the
Administrative Agent within 10 days of the Borrowing Date.
(b) Except to the extent otherwise set forth herein or in the
schedules hereto, to the best of the Company's knowledge, each
of the material representations and warranties given by Seller
to the Company in the LucasVarity Acquisition Agreement is
true and correct in all material respects as of the date
hereof (or as of any earlier date to which such representation
and warranty specifically relates) and will be true and
correct in all material respects as of the Closing Date and
the Borrowing Date (or as of such earlier date, as the case
may be), in each case subject to the qualifications set forth
in the schedules to the LucasVarity Acquisition Agreement.
(c) Subject to the qualifications set forth therein, each of the
representations and warranties given by the Company to Seller
in the LucasVarity Acquisition Agreement is true and correct
in all material respects as of the date hereof and will be
true and correct in all material respects as of the Closing
Date and the Borrowing Date.
5.19 Year 2000 Compliance. The Company and its Subsidiaries have (i) engaged
in a process of assessment of the existence of the Year 2000 Problems reasonably
appropriate to the scope and complexity of their respective Systems; (ii)
adopted and are successfully implementing a plan of correction ("Plan of
Correction") which the Company reasonably believes will result in a substantial
elimination of Year 2000 Problems before any processing failure of a System or
of Systems due to Year 2000 Problems which might have a material affect on the
business, operations or financial performance of the Company and, in the case of
all Systems critical to the business or operations of the Company and its
Subsidiaries (whether now owned or hereafter acquired), elimination in all
material respects of Year 2000 Problems before any processing failure of a
System or of Systems due to Year 2000 Problems which might have a material
affect on the business, operations or financial performance of the Company;
(iii) adopted and are successfully implementing validation procedures reasonably
calculated to test on an ongoing basis the sufficiency of the Plan of
Correction, its implementation, and the correction of Year
35
2000 Problems in any System; (iv) adopted and are successfully implementing
policies and procedures requiring regular reports to, and monitoring by, senior
management of the Company concerning the foregoing matters; and (v) provided the
Administrative Agent true and correct copies of the written Plan of Correction
and related implementation budgets, reviewed by the Company's Board of
Directors.
ARTICLE VI
----------
COVENANTS
---------
During the term of this Agreement, unless the Required
Lenders shall otherwise consent in writing:
6.1 Financial Reporting. The Company will maintain, for itself and each
Subsidiary, a system of accounting enabling it to provide financial statements
for the Company and each Subsidiary in accordance with Agreement Accounting
Principles and furnish to the Lenders:
(i) Within 120 days after the close of each of its fiscal years,
an unqualified (except for qualifications relating to changes
in accounting principles or practices reflecting changes in
generally accepted accounting principles and required or
approved by the Company's independent certified public
accountants) audit report certified by nationally recognized
independent certified public accountants certifying that the
Company's consolidated financial statements are fairly stated
in all material respects, in accordance with Agreement
Accounting Principles for itself and the Subsidiaries,
including balance sheets as of the end of such period, related
income statements, and statements of cash flows, accompanied
by a certificate of said accountants that, in the course of
their examination necessary for their certification of the
foregoing, they have obtained no knowledge of any Default or
Unmatured Default, or if, in the opinion of such accountants,
any Default or Unmatured Default shall exist, stating the
nature and status thereof.
(ii) Within 60 days after the close of each of the first three
quarterly periods of each of its fiscal years, for itself and
its Subsidiaries, a consolidated unaudited balance sheet as at
the close of each such period and a related income statement
and a statement of cash flows for the period from the
beginning of such fiscal year to the end of such quarter, all
certified by a Designated Financial Officer of the Company.
(iii) Together with the financial statements required under Sections
6.1(i) and (ii), a compliance certificate in substantially the
form of Exhibit E annexed hereto signed by a Designated
Financial Officer of the Company showing the calculations
necessary to determine compliance with this Agreement and
stating that no Default or Unmatured Default exists, or if any
Default or Unmatured Default exists, stating the nature and
status thereof. The Company may, at its
36
option, satisfy its obligations to deliver financial
statements under Sections 6.1(i) and (ii) hereof by delivery
of its Form 10-K and 10-Q, respectively, for any relevant
fiscal year or quarterly period, as filed by the Company with
the Securities and Exchange Commission.
(iv) As soon as possible and in any event within 10 days after (x)
receipt by the Company, and (y) a determination is made by the
Company concerning a Material Adverse Effect with respect
thereto, a copy of (a) any notice or claim to the effect that
the Company or any of its Subsidiaries is or may be liable to
any Person as a result of the release by the Company, any of
its Subsidiaries, or any other Person of any toxic or
hazardous waste or substance into the environment, (b) any
notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the
Company or any of its Subsidiaries, and (c) any notice of
occurrence of any Reportable Event, which, in each case, could
reasonably be expected to have a Material Adverse Effect.
(v) Promptly upon the furnishing thereof to the shareholders of
the Company, copies of all financial statements, reports and
proxy statements so furnished.
(vi) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other reports
which the Company or any of its Subsidiaries files with the
Securities and Exchange Commission, including without
limitation all reports on Form 10-K, l0-Q and 8-K, and which
are not otherwise delivered to the Lenders hereunder.
(vii) Such other information (including non-financial information)
concerning the Company and its Subsidiaries as the
Administrative Agent or any Lender may from time to time
reasonably request.
6.2 Use of Proceeds. The Company will use the proceeds of the Loans to fund
a portion of the LucasVarity Acquisition Financing Requirements. None of the
proceeds of any of the Loans made under this Agreement will be used, whether
directly or indirectly, in violation of any applicable law or regulation,
including without limitation Regulation T, Regulation U or Regulation X.
6.3 Notice of Default. The Company will give prompt notice in writing to
the Administrative Agent of the occurrence of any Default or Unmatured Default.
6.4 Conduct of Business. The Company will, and will cause each Subsidiary
to, carry on and conduct its business in substantially the same fields of
enterprise as it is presently conducted and to do all things necessary to remain
duly incorporated, validly existing and in good standing in its jurisdiction of
organization (subject to Sections 6.11, 6.12 and 6.13) and maintain all
requisite
37
authority to conduct its business in each jurisdiction in which its business is
conducted, except in any such case where such failure would not reasonably be
expected to have a Material Adverse Effect.
6.5 Taxes. The Company will, and will cause each Subsidiary to, timely file
complete and correct United States federal and applicable foreign, state and
local tax returns required by law and pay when due all taxes, assessments and
governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles and those which the failure to file or pay
would not reasonably be expected to have a Material Adverse Effect.
6.6 Insurance. The Company will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
their Property in such amounts (with such customary deductibles, exclusions and
self insurance) and covering such risks as management of the Company reasonably
considers consistent with sound business practice, and the Company will furnish
to any Lender upon request such information as to the insurance carried as may
be reasonably requested by the Administrative Agent on behalf of such Lender.
6.7 Compliance with Laws. The Company will, and will cause each Subsidiary
to, comply with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject except for such
noncompliance as would not reasonably be expected to have a Material Adverse
Effect.
6.8 Maintenance of Properties. The Company will, and will cause each
Subsidiary to, do all things reasonably necessary to maintain, preserve, protect
and keep its material Property in good repair, working order and condition
(ordinary wear and tear excepted), and make all reasonably necessary and proper
repairs, renewals and replacements.
6.9 Inspection. The Company will, and will cause each Subsidiary to, permit
the Administrative Agent, by its representatives and agents, and any reasonable
number of representatives of the Lenders, to inspect (at no cost to the Company)
any of the Property, corporate books and financial records of the Company and
each Subsidiary, to examine and make copies of the books of accounts and other
financial records of the Company and each Subsidiary, and to discuss the
affairs, finances and accounts of the Company and each Subsidiary with, and to
be advised as to the same by, their respective officers at such reasonable times
and intervals as the Administrative Agent may designate.
6.10 Subsidiary Indebtedness. The Company will not permit any Subsidiary
to create, incur or suffer to exist any Indebtedness, except:
(i) Indebtedness incurred pursuant to the Existing Credit
Agreement.
38
(ii) Indebtedness existing as of the Closing Date in an outstanding
aggregate principal amount not to exceed $50,000,000.
(iii) Indebtedness of any Subsidiary to the Company or any other
Subsidiary.
(iv) Indebtedness of any Person that becomes a Subsidiary after the
date hereof; provided that such Indebtedness existed at the
time such Person becomes a Subsidiary and is not created in
contemplation of or in connection with such Person becoming a
Subsidiary.
(v) Any refunding or refinancing of any Indebtedness referred to
in clauses (i) through (iv) above, provided that any such
refunding or refinancing of Indebtedness referred to in clause
(ii) or (iv) does not increase the principal amount thereof.
(vi) Other Indebtedness; provided that, at the time of the
creation, incurrence or assumption of such other Indebtedness
and after giving effect thereto, the aggregate amount of all
such other Indebtedness of the Subsidiaries does not exceed an
amount equal to 50% of Net Worth at such time.
6.11 Merger. The Company will not, nor will it permit any Subsidiary to,
merge or consolidate with or into any other Person, except that, provided that
no Default or Unmatured Default shall have occurred and be continuing or would
result therefrom on a pro forma basis reasonably acceptable to the
Administrative Agent, the Company may merge or consolidate with any other U.S.
corporation and each Subsidiary may merge or consolidate with any other Person,
provided, further, that in the case of any such merger or consolidation
involving the Company, the Company is the surviving corporation.
6.12 Sale of Assets. The Company will not, nor will it permit any Subsidiary
to, lease, sell or otherwise dispose of its Property, to any other Person (other
than the Company or a Wholly-Owned Subsidiary), except:
(i) Sales of inventory, marketable securities and cash equivalents
in the ordinary course of business and sales or other
dispositions of Margin Stock at any time.
(ii) Sales or other dispositions of accounts receivable payable
within 90 days of the date of sale.
(iii) Sales, leases or other dispositions of obsolete Property or
Property no longer used or useful in the business of the
Company or its Subsidiaries.
39
(iv) Sales or other dispositions of Property that is replaced
within eighteen months of such sale or other disposition with
other Property which has a fair market value not materially
less than the Property sold or otherwise disposed of.
(v) Sales or other dispositions of motor vehicles, office or other
equipment in the ordinary course of business and not material
in aggregate amount.
(vi) Sales of financial instruments of the Company and its
Subsidiaries existing as of the Closing Date that do not in
the aggregate have a value in excess of $30,000,000.
(vii) Other leases, sales or other dispositions of its Property
that, together with all other Property of the Company and its
Subsidiaries previously leased, sold or disposed of (other
than as provided in clauses (i) through (vi) above) as
permitted by this Section during the twelve-month period
ending with the month prior to the month in which any such
lease, sale or other disposition occurs, do not constitute a
Substantial Portion of the Property of the Company and its
Subsidiaries.
6.13 Investments and Acquisitions. The Company will not, nor will it permit
any Subsidiary to, make or suffer to exist any Investments (including without
limitation, loans and advances to, and other Investments in, Subsidiaries which
are not Wholly-Owned Subsidiaries), or commitments therefor, or make any
Acquisition of any Person, if (i) after giving effect to such Investment or
Acquisition, on a pro forma basis (after giving effect to the LucasVarity
Acquisition, the Volvo Acquisition and the Euclid Acquisition) (a) any Default
or Unmatured Default shall have occurred and be continuing or (b) more than 30%
of the projected consolidated net income of the Company and its Subsidiaries
(determined in accordance with Agreement Accounting Principles) for the
twelve-month period following such Investment or Acquisition will be derived
from fields of enterprise which are not substantially the same as those
conducted by the Company and its Subsidiaries as of the Closing Date, or (ii)
the value of any consideration (other than equity securities of the Company) to
be paid by the Company and its Subsidiaries in connection with any such
Investment (other than Investments of the types described in clauses (ii)
through (iv) of the definition thereof) or Acquisition (other than the
LucasVarity Acquisition, the Volvo Acquisition and the Euclid Acquisition),
together with the aggregate value of the consideration (other than equity
securities of the Company) paid or to be paid by the Company and its
Subsidiaries in connection with all Acquisitions and all such Investments after
the Closing Date (other than the LucasVarity Acquisition, the Volvo Acquisition
and the Euclid Acquisition), would exceed $200,000,000, or (iii) after giving
effect to such Investment or Acquisition, on a pro forma basis the Company and
its Subsidiaries would not be in compliance with the covenants contained in
Sections 6.17 and 6.18; provided, however, that nothing in this Section 6.13
shall be construed to prohibit the LucasVarity Acquisition, the Volvo
Acquisition or the Euclid Acquisition.
40
6.14 Liens. The Company will not, nor will it permit any Subsidiary to,
create, incur, or suffer to exist any Lien in, of or on the Property of the
Company or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
on its Property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate proceedings
and for which adequate reserves in accordance with Agreement
Accounting Principles shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of
obligations not more than 90 days past due or which are being
contested in good faith by appropriate proceedings and for
which adequate reserves shall have been set aside on its
books.
(iii) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a
nature generally existing with respect to properties of a
similar character and which do not in any material way affect
the marketability of the same or interfere with the use
thereof in the business of the Company or the Subsidiaries.
(v) Liens existing on the Closing Date on assets of Subsidiaries
of the Company, provided that no increase in the principal
amount secured thereby shall be permitted.
(vi) Liens in favor of the Company or any Lien granted by any
Subsidiary of the Company in favor of a Wholly-Owned
Subsidiary of the Company.
(vii) Liens existing on such Property at the time of its acquisition
(directly or indirectly) (other than any such Lien created in
contemplation of such acquisition).
(viii) Liens on the Property of a Person that is merged with or into
the Company or a Subsidiary or of a Person that becomes a
Subsidiary after the Closing Date (in each case to the extent
such merger, Acquisition or Investment is otherwise permitted
by this Agreement), provided that (A) such Liens existed at
the time such Person was so merged or became a Subsidiary and
were not created in anticipation of any such transaction, (B)
any such Lien does not by its terms cover
41
any additional property or assets acquired after the time such
Person was so merged or became a Subsidiary, and (C) any such
Lien does not by its terms secure any Indebtedness other than
Indebtedness existing immediately prior to the time such
Person was so merged or became a Subsidiary.
(ix) Liens resulting from the deposit of funds or evidences of
Indebtedness in trust for the purpose of defeasing
Indebtedness of the Company or any Subsidiary.
(x) Bank setoff rights arising in the ordinary course of business.
(xi) Deposits or Liens to secure the performance (and not securing
any Indebtedness) of statutory obligations, surety and appeal
bonds, performance bonds and other obligations of like nature
incurred in the ordinary course of business.
(xii) Judgment or other similar Liens arising in connection with
legal proceedings so long as the execution or other
enforcement thereof is effectively stayed and the claims
secured thereby are being contested in good faith by
appropriate proceedings and the Company or such Subsidiary, as
the case may be, has established appropriate reserves against
such claims in accordance with Agreement Accounting
Principles.
(xiii) Any interest or title of a lessor in the property subject to
any Capitalized Lease Obligation (to the extent such
Capitalized Lease Obligation is otherwise permitted by this
Agreement) or operating lease.
(xiv) Liens arising under the Existing Credit Agreement as in effect
on the Closing Date.
(xv) Liens arising in connection with sales or other dispositions
of accounts receivable permitted by Section 6.12(ii).
(xvi) Any extension, renewal or replacement (or successive
extension, renewal, or replacement) in whole or in part, of
any Lien referred to in the foregoing clauses (i) through (xv)
inclusive; provided, however, that the principal amount of
Indebtedness secured thereby shall not exceed the principal
amount of Indebtedness so secured at the time of such
extension, renewal or replacement, and that such extension,
renewal or replacement shall be limited to all or a part of
the property which secured the Lien so extended, renewed or
replaced (plus improvements on such property).
(xvii) Liens securing Indebtedness which are not otherwise permitted
by the foregoing clauses of this Section 6.14, provided that
the aggregate outstanding principal
42
amount of the Indebtedness secured by all such Liens shall not
exceed 50% of Net Worth.
Notwithstanding the foregoing, the restrictions set forth in this Section 6.14
shall not apply to Margin Stock if and to the extent that the value of the
Margin Stock with respect to which the rights of the Company and its
Subsidiaries are restricted by this Section 6.14 would otherwise exceed 25% of
the value of all assets with respect to which the rights of the Company and its
Subsidiaries are restricted by this Section 6.14.
6.15 Affiliates. The Company will not, and will not permit any Subsidiary
to, enter into any transaction (including, without limitation, the purchase or
sale of any Property or service) with, or make any payment or transfer to, any
Affiliate except in the ordinary course of business and pursuant to the
reasonable requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms (taken as a whole) no less favorable to the Company or
such Subsidiary than the Company or such Subsidiary would obtain in a comparable
arm's-length transaction.
6.16 Contingent Obligations. The Company will not, nor will it permit any
Subsidiary to, make or suffer to exist any Contingent Obligation (including,
without limitation, any Contingent Obligation with respect to the obligations of
a Subsidiary) in respect of any Indebtedness, except (i) by endorsement of
instruments for deposit or collection in the ordinary course of business; (ii)
Contingent Obligations of any Subsidiary with respect to Indebtedness of another
Subsidiary or the Company and Contingent Obligations of the Company with respect
to Indebtedness of a Subsidiary; (iii) Contingent Obligations of the Company
under Article IX of the Existing Credit Agreement; (iv) Contingent Obligations
existing on the Closing Date; (v) Contingent Obligations with respect to
Facility Letters of Credit (as defined in the Existing Credit Agreement); (vi)
Contingent Obligations under Rate Hedging Agreements; (vii) Contingent
Obligations with respect to customary indemnifications and purchase price
adjustment obligations incurred in connection with mergers, Acquisitions,
Investments and sales of assets (in each case to the extent such merger,
Acquisition, Investment or sale of assets is otherwise permitted by this
Agreement); (viii) Contingent Obligations with respect to Indebtedness permitted
by Section 6.10; (ix) Contingent Obligations with respect to customary product
and service warranties; (x) Contingent Obligations with respect to director's,
officer's and other indemnities set forth in the Company's or any of its
Subsidiary's organizational documents as in effect from time to time; and (xi)
other Contingent Obligations, provided that the Indebtedness and other
liabilities guaranteed or supported thereby does not exceed in the aggregate for
the Company and all of its Subsidiaries an amount equal to 50% of Net Worth.
6.17 Debt Ratio. The Company shall not permit its Debt Ratio, calculated on
a consolidated basis for the Company and its Subsidiaries, to exceed 3.0 to 1.0
on the last day of any fiscal quarter.
43
6.18 Net Worth. The Company shall maintain, on the last day of each month
after the Closing Date, a Net Worth at least equal to $150,000,000.
6.19 Year 2000 Compliance. The Company shall (i) promptly advise the
Administrative Agent of any material (A) disruption or delay in the
implementation of the Plan of Correction, as the same may be updated from time
to time, including any determination by the Company, any senior manager of the
Company or any Subsidiary of the Company, or any consultant to the Company or
any such Subsidiary with respect to Year 2000 Problems ("Consultant") that there
may be a failure to achieve any of the objectives specifically identified in
subdivision (ii) of Section 5.19, or (B) change in the written Plan of
Correction or related implementation budget referred to in subdivision (v) of
Section 5.19, or any later version thereof furnished to the Administrative
Agent; (ii) afford to the Administrative Agent and its representatives
reasonable access to the Company's and its Subsidiaries' properties, personnel,
service providers, vendors and records for the purpose of enabling the
Administrative Agent to assess the adequacy of, and the record of performance of
the Company and its Subsidiaries with respect to, the Plan of Correction,
related financial performance and conformity of actual performance with related
implementation budgets; (iii) periodically report to the Administrative Agent,
in such form as the Administrative Agent may reasonably request, on the progress
of the Company and its Subsidiaries in implementing the Plan of Correction; the
budget for, and actual financial performance with respect to, implementation of
the Plan of Correction; the assessment of the Company, any senior manager of the
Company or any Subsidiary, or any Consultant of the adequacy of the Plan of
Correction or the related implementation budget.
ARTICLE VII
-----------
DEFAULTS
--------
The occurrence of any one or more of the following events
shall constitute a Default:
7.1 Any representation or warranty made or deemed made by or on behalf of
the Company or its Subsidiaries to the Lenders or the Administrative Agent in
any Loan Document, in connection with any Loan, or in any certificate or
information delivered in writing in connection with any Loan Document shall be
false in any material respect on the date as of which made.
7.2 Nonpayment of principal of any Loan when due, or nonpayment of interest
on any Loan within three Business Days after the same becomes due, or nonpayment
of any other obligations under any of the Loan Documents within ten days after
the same becomes due.
7.3 The breach by the Company of any of the terms or provisions of Section
6.3, 6.10, 6.11, 6.12, 6.13, 6.15, 6.16, 6.17 or 6.18.
7.4 The breach by the Company (other than a breach which constitutes a
Default under Section 7.1, 7.2 or 7.3) of any of the terms or provisions of this
Agreement or any other Loan
44
Document which is not remedied within 30 days after written notice from the
Administrative Agent.
7.5 Failure of the Company or any of its Subsidiaries to pay when due any
Indebtedness or Rate Hedging Obligations aggregating in excess of $20,000,000
("Material Indebtedness") or the default by the Company or any of its
Subsidiaries in the performance of any term, provision or condition (other than
such a term, provision or condition to or for the benefit of a Lender or
Affiliate thereof restricting the sale, pledge or other disposition by the
Company or any Subsidiary of Margin Stock having a value in excess of 25% of the
value of the assets referred to in clause(2)(i) of the definition of "Indirectly
Secured" in Section 221.2 of Regulation U unless the Board of Governors of the
Federal Reserve System or its staff advises the Administrative Agent in writing
that the existence of this Section 7.5 without this parenthetical exception
would not in such circumstances render this Agreement "secured directly or
indirectly by margin stock" within the meaning of its Regulation U) contained in
any agreement under which any such Material Indebtedness was created or is
governed, or any other event shall occur or condition exist, the effect of which
is to cause, or to permit the holder or holders of such Material Indebtedness to
cause, such Material Indebtedness to become due prior to its stated maturity; or
any Material Indebtedness of the Company or any of its Subsidiaries shall be
declared to be due and payable or required to be prepaid or repurchased (other
than by a regularly scheduled payment) prior to the stated maturity thereof; or
the Company or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6 The Company or any of its Significant Subsidiaries shall (i) have an
order for relief entered with respect to it under the Federal bankruptcy laws as
now or hereafter in effect, (ii) make an assignment for the benefit of
creditors, (iii) apply for, seek, consent to, or acquiesce in, the appointment
of a receiver, custodian, trustee, examiner, liquidator or similar official for
it or any Substantial Portion of its Property, (iv) institute any proceeding
seeking an order for relief under the Federal bankruptcy laws as now or
hereafter in effect or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it, (v) take any corporate action to authorize or effect any of
the foregoing actions set forth in this Section 7.6 or (vi) fail to contest in
good faith any appointment or proceeding described in Section 7.7.
7.7 Without its application, approval or consent, a receiver, trustee,
examiner, liquidator or similar official shall be appointed for the Company or
any of its Significant Subsidiaries, or any Substantial Portion of their
respective Property, or a proceeding described in Section 7.6(iv) shall be
instituted against the Company or any of its Significant Subsidiaries and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of 60 consecutive days.
45
7.8 Any court, government or governmental agency shall without appropriate
compensation condemn, seize or otherwise appropriate, or take custody or control
of (each a "Condemnation"), all or any portion of the Property of the Company
and its Subsidiaries which, when taken together with all other Property of the
Company and its Subsidiaries so condemned, seized, appropriated, or taken
custody or control of, during the twelve-month period ending with the month in
which any such Condemnation occurs, constitutes a Substantial Portion and is
reasonably likely to have a Material Adverse Effect.
7.9 The Company or any of its Subsidiaries shall fail within 90 days to
pay, bond or otherwise discharge any judgment or order for the payment of money
in excess of $20,000,000, which is not stayed on appeal.
7.10 Any member of the Controlled Group shall fail to pay when due an amount
or amounts aggregating in excess of $20,000,000 which it shall have become
liable to pay under Title IV of ERISA; or notice of intent to terminate a Single
Employer Plan with Unfunded Liabilities in excess of $20,000,000 (a "Material
Plan") shall be filed under Section 4041(c) of ERISA by any member of the
Controlled Group, any plan administrator or any combination of the foregoing; or
PBGC shall institute proceedings under which it is likely to prevail under Title
IV of ERISA to terminate, to impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to
administer any Material Plan; or a condition shall exist by reason of which the
PBGC would be entitled to obtain a decree adjudicating that any Material Plan
must be terminated; or there shall occur a complete or partial withdrawal from,
or a default, within the meaning of Section 4219(c)(5) of ERISA, with respect
to, one or more Multiemployer Plans which causes one or more members of the
Controlled Group to incur a current payment obligation in excess of $20,000,000.
7.11 The Company or any of its Subsidiaries shall be the subject of any
proceeding or investigation pertaining to the release by the Company or any of
its Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, or any violation of any federal, state or local
environmental, health or safety law or regulation, which, in either case, could
reasonably be expected to have a Material Adverse Effect.
7.12 The occurrence of any Change in Control.
7.13 The Company shall contest the validity or enforceability of any Loan
Document in writing or deny in writing that it has any further liability under
any Loan Document to which it is a party.
7.14 The LucasVarity Acquisition shall not be consummated in accordance with
this Agreement and the LucasVarity Acquisition Agreement as in effect on the
Borrowing Date (with such amendments, supplements or other modifications thereto
as are permitted hereunder) concurrently with the making of the Loans.
46
ARTICLE VIII
------------
ACCELERATION WAIVERS, AMENDMENTS AND REMEDIES
---------------------------------------------
8.1 Acceleration.
(a) If any Default described in Section 7.6 or 7.7 occurs, the
obligations of the Lenders to make Loans hereunder shall
automatically terminate and the Obligations shall immediately
become due and payable without presentment, demand, protest or
notice of any kind, all of which the Company hereby expressly
waives and without any election or action on the part of the
Administrative or any Lender.
(b) If any Default occurs and is continuing (other than a Default
described in Section 7.6 or 7.7), the Required Lenders may
terminate or suspend the obligations of the Lenders to make
Loans, or declare the Obligations to be due and payable, or
both, whereupon (if so declared) the Obligations shall become
immediately due and payable, without presentment, demand,
protest or notice of any kind, all of which the Company hereby
expressly waives.
8.2 Amendments.
8.2.1 Subject to the provisions of this Article VIII, the Required Lenders
(or the Administrative Agent with the consent in writing of the Required
Lenders) and the Company may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Company hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of each Lender affected thereby:
(a) Extend the final maturity of any Loan or Note or forgive all
or any portion of the principal amount thereof, or reduce the
rate or extend the time of payment of interest or fees
thereon.
(b) Reduce the percentage specified in the definition of Required
Lenders.
(c) Extend the Maturity Date, or reduce the amount or extend the
payment date for, the mandatory payments required under
Section 2.5, or increase the amount of the Commitment of any
Lender hereunder, or permit the Company to assign its rights
under this Agreement.
(d) Amend this Section 8.2.1.
8.2.2 No amendment of any provision of this Agreement relating to the
Arranger or the Administrative Agent shall be effective without the written
consent of the Arranger or the
47
Administrative Agent, respectively. The Administrative Agent may waive payment
of the fee required under Section 11.3.2 without obtaining the consent of any
other party to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders or the
Administrative Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Loan notwithstanding the existence of a Default or
the inability of the Company to satisfy the conditions precedent to such Loan
shall not constitute any waiver or acquiescence. Any single or partial exercise
of any such right shall not preclude other or further exercise thereof or the
exercise of any other right, and no waiver, amendment or other variation of the
terms, conditions or provisions of the Loan Documents whatsoever shall be valid
unless in writing signed by the Lenders required pursuant to Section 8.2, and
then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all
shall be available to the Administrative Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
----------
GENERAL PROVISIONS
------------------
9.1 Survival of Representations. All representations and warranties of the
Company contained in this Agreement shall survive delivery of the Loan Documents
and the making of the Loans herein contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Company in violation of any limitation or prohibition provided by any applicable
statute or regulation.
9.3 Taxes. Any taxes (excluding income taxes and franchise taxes (imposed
in lieu of income taxes) imposed on the Administrative Agent or any Lender as a
result of a present or former connection between the Administrative Agent or
such Lender and the jurisdiction of the Governmental Authority imposing such tax
or any political subdivision or taxing authority thereof or therein (other than
any such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan Document)) or other similar
assessments or charges made by any governmental or revenue authority in respect
of the Loan Documents shall be paid by the Company, together with interest and
penalties, if any.
9.4 Headings. Section headings in the Loan Documents are for convenience of
reference only, and shall not govern the interpretation of any of the provisions
of the Loan Documents.
9.5 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Company, the Administrative Agent and the Lenders and
supersede all prior
48
agreements and understandings among the Company, the Administrative Agent and
the Lenders relating to the subject matter thereof other than any fee letters
among the Company and the Arranger and the Administrative Agent and any other
agreements of any of the Company with the Arranger or the Administrative Agent
which survive the execution of the Loan Documents.
9.6 Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Arranger or the Administrative Agent is authorized to act as such). The failure
of any Lender to perform any of its obligations hereunder shall not relieve any
other Lender from any of its obligations hereunder. This Agreement shall not be
construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and assigns.
9.7 Expenses; Indemnification. The Company shall reimburse each Agent for
any reasonable costs and out-of-pocket expenses (including reasonable fees and
time charges of attorneys for such Agent, which attorneys may be employees of
such Agent) paid or incurred by such Agent in connection with the preparation,
negotiation, execution, delivery, review, amendment, modification and
administration of the Loan Documents, except as otherwise agreed in writing from
time to time. The Company also agrees to reimburse the Administrative Agent and
the Lenders for any reasonable costs, and out-of-pocket expenses (including
reasonable fees and time charges of attorneys for the Administrative Agent and
the Lenders, which attorneys may be employees of the Administrative Agent or the
Lenders) paid or incurred by the Arranger, the Administrative Agent or any
Lender in connection with the collection and enforcement of the Loan Documents
subject to the limitations set forth below. The Company further agrees to
indemnify each of the Arranger and the Administrative Agent and each Lender, and
their respective directors, officers and employees against all losses, claims,
damages, penalties, judgments, liabilities and expenses (including, without
limitation, all expenses of litigation or preparation therefor whether or not
the Arranger, the Administrative Agent or any Lender is a party thereto) which
any of them may pay or incur arising out of or relating to this Agreement, the
other Loan Documents, the transactions contemplated hereby or the direct or
indirect application or proposed application of the proceeds of any Loan subject
to the limitations set forth below, provided that the Company shall have no
obligation to indemnify any person in respect of any present or future income,
stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings except as (and to the extent) provided in Section 3.6 and Section
9.3 hereof. The Company shall have no obligation to indemnify any Agent or
Lender (or their respective directors, officers and employees) to the extent
that any losses, claims, damages, penalties, judgments, liabilities and expenses
are determined by a court of competent jurisdiction in a final, non-appealable
order to have resulted from the gross negligence or willful misconduct of, or
violation of applicable laws or any of the Loan Documents by, any such Person.
The obligations of the Company under this Section shall survive the termination
of this Agreement.
49
9.8 Numbers of Documents. All statements, notices, closing documents, and
requests hereunder shall be furnished to the appropriate Agent with sufficient
counterparts so that each Agent may furnish one to each of the Lenders.
9.9 Accounting. Except as provided to the contrary herein, all accounting
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
9.10 Severability of Provisions. Any provision in any Loan Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.11 Non-liability of Lenders. The relationship between the Company and the
Lenders and the Administrative Agent shall be solely that of borrower and
lender. None of the Arranger, the Administrative Agent nor any Lender shall have
any fiduciary responsibilities to the Company. None of the Arranger, the
Administrative Agent nor any Lender undertakes any responsibility to the Company
to review or inform the Company of any matter in connection with any phase of
the Company's business or operations. The Company agrees that none of the
Arranger, the Administrative Agent nor any Lender shall have liability to the
Company (whether sounding in tort, contract or otherwise) for losses suffered by
the Company in connection with, arising out of, or in any way related to, the
transactions contemplated and the relationship established by the Loan
Documents, or any act, omission or event occurring in connection therewith,
unless it is determined by a court of competent jurisdiction in a final and
non-appealable order that such losses resulted from the gross negligence or
willful misconduct of, or violation of applicable laws or any of the Loan
Documents by, the party from which recovery is sought. None of the Arranger, the
Administrative Agent nor any Lender shall have any liability with respect to,
and the Company hereby waives, releases and agrees not to xxx for, any special,
indirect or consequential damages suffered by the Company in connection with,
arising out of, or in any way related to the Loan Documents or the transactions
contemplated thereby.
9.12 Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Company pursuant to this Agreement in
confidence, and will not disclose or use for any purpose other than its credit
evaluation under this Agreement such confidential information, except for
disclosure; (i) to any Transferee or prospective Transferee to the extent
provided in Section 11.4; (ii) to legal counsel, accountants and other
professional advisors to that Lender to the extent necessary to advise that
Lender concerning its rights or obligations in respect of this Agreement;
provided that such professional advisor agrees to hold any confidential
information which it may receive in confidence and not to disclose or use such
confidential information for any purpose other than advising that Lender with
respect to its rights and obligations under this Agreement; (iii) to regulatory
officials to the extent required by applicable law, rule, regulations, order,
policy or directive (whether or not any such policy or
50
directive has the force of law); and (iv) pursuant to any order of any court,
arbitrator or Governmental Authority of competent jurisdiction (or as otherwise
required by law); provided, however, that the Lender (or other Person given
confidential information by such Lender) shall provide the Company with prompt
notice of any such required disclosure so that the Company may seek a protective
order or other appropriate remedy, and in the event that such protective order
or other remedy is not obtained, such Lender (or such other Person) will furnish
only that portion of the confidential information which is legally required.
9.13 Nonreliance. Each Lender hereby represents that it is not relying on or
looking to any margin stock (as defined in Regulation U) for the repayment of
the Loans provided for herein.
9.14 Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if any Default described in Section 7.2, 7.6 or
7.7 occurs or the Loans are accelerated pursuant to Section 8.1, any and all
deposits (including all account balances, whether provisional or final and
whether or not collected or available) and any other Indebtedness at any time
held or owing by any Lender to or for the credit or account of the Company may
be offset and applied toward the payment of the Obligations owing to such Lender
by the Company.
9.15 Ratable Sharing. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Loans to the Company (other than payments received
pursuant to Section 3.1, 3.2, 3.4, 3.6 or 9.7) in a greater proportion than that
received by any other Lender from the Company or its Loans, such Lender agrees,
promptly upon demand, to purchase a portion of the Loans to the Company held by
the other Lenders so that after such purchase each Lender will hold its ratable
proportion of Loans to the Company. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made.
ARTICLE X
---------
AGENTS
------
10.1 Appointment. WDR is hereby appointed the Arranger hereunder, and each
Lender hereby authorizes the Arranger to act as its agent in accordance with the
terms of this Agreement and the other Loan Documents. UBS is hereby appointed
the Administrative Agent hereunder and under the other Loan Documents and each
Lender hereby authorizes the Administrative Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents. NBD
Bank is hereby appointed the Documentation Agent hereunder, and each Lender
hereby authorizes the Documentation Agent to act as its agent in accordance with
the terms of this Agreement and the other Loan Documents. Each of the Arranger,
the Documentation Agent and the Administrative Agent hereby agrees to act upon
the express conditions contained in this Agreement and the other Loan Documents,
as applicable. The
51
provisions of this Article X are solely for the benefit of the Arranger, the
Documentation Agent and the Administrative Agent and Lenders and the Company
shall have no rights as a third party beneficiary of any of the provisions
thereof. In performing its functions and duties under this Agreement, each of
the Arranger, the Documentation Agent and the Administrative Agent shall act
solely as an agent of Lenders and does not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for Company or any of its Subsidiaries. The Arranger, without consent of or
notice to any party hereto, may assign any and all of its rights or obligations
hereunder to any of its Affiliates. As of the Closing Date, all obligations of
WDR, in its capacity as the Arranger hereunder, and all obligations of NBD Bank,
in its capacity as the Documentation Agent hereunder, shall terminate.
10.2 Powers and Duties; General Immunity.
10.2.1 Powers; Duties Specified. Each Lender irrevocably authorizes the
Administrative Agent to take such action on such Lender's behalf and to exercise
such powers, rights and remedies hereunder and under the other Loan Documents as
are specifically delegated or granted to such agent by the terms hereof and
thereof, together with such powers, rights and remedies as are reasonably
incidental thereto. Each of the Administrative Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the other Loan Documents. Each of the Arranger, the Documentation Agent and the
Administrative Agent may exercise such powers, rights and remedies and perform
such duties by or through its agents or employees. Neither the Arranger, the
Documentation Agent nor the Administrative Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon the Arranger, the Documentation Agent or the Administrative Agent
any obligations in respect of this Agreement or any of the other Loan Documents
except as expressly set forth herein or therein.
10.2.2 No Responsibility for Certain Matters. Neither the Arranger, the
Documentation Agent nor the Administrative Agent shall be responsible to any
Lender for the execution, effectiveness, genuineness, validity, enforceability,
collectibility or sufficiency of this Agreement or any other Loan Document or
for any representations, warranties, recitals or statements made herein or
therein or made in any written or oral statements or in any financial or other
statements, instruments, reports or certificates or any other documents
furnished or made by the Arranger, the Documentation Agent or the Administrative
Agent to Lenders or by or on behalf of the Company to the Arranger, the
Documentation Agent or the Administrative Agent or any Lender in connection with
the Loan Documents and the transactions contemplated thereby or for the
financial condition or business affairs of the Company or any other Person
liable for the payment of any Obligations, nor shall the Arranger, the
Documentation Agent or the Administrative Agent be required to ascertain or
inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as
to the use of the proceeds of the Loans or as to the existence or possible
existence of any Default or Unmatured Default. Anything contained in this
Agreement to the contrary notwithstanding, the
52
Administrative Agent shall not have any liability arising from confirmations of
the amount of outstanding Loans or the component amounts thereof.
10.2.3 Exculpatory Provisions. Neither the Arranger, the Documentation Agent
nor the Administrative Agent nor any of their respective officers, partners,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by the Arranger, the Documentation Agent or the Administrative Agent
under or in connection with any of the Loan Documents except to the extent
caused by such agent's gross negligence or willful misconduct. Each of the
Arranger, the Documentation Agent and the Administrative Agent shall be entitled
to refrain from any act or the taking of any action (including the failure to
take an action) in connection with this Agreement or any of the other Loan
Documents or from the exercise of any power, discretion or authority vested in
it hereunder or thereunder unless and until such agent shall have received
instructions in respect thereof from Required Lenders (or such other Lenders as
may be required to give such instructions under Section 8.2) and, upon receipt
of such instructions from Required Lenders (or such other Lenders, as the case
may be), such agent shall be entitled to act or (where so instructed) refrain
from acting, or to exercise such power, discretion or authority, in accordance
with such instructions. Without prejudice to the generality of the foregoing,
(i) each of the Arranger, the Documentation Agent and the Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for the Company and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against the Arranger, the
Documentation Agent or the Administrative Agent as a result of such agent acting
or (where so instructed) refraining from acting under this Agreement or any of
the other Loan Documents in accordance with the instructions of Required Lenders
(or such other Lenders as may be required to give such instructions under
Section 8.2).
10.2.4 Agent Entitled to Act as Lender. The agency hereby created shall in no
way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, the Arranger, the Documentation Agent or the Administrative
Agent in its individual capacity as a Lender hereunder. With respect to its
participation in the Loans, the Administrative Agent shall have the same rights
and powers hereunder as any other Lender and may exercise the same as though it
were not performing the duties and functions delegated to it hereunder, and the
term "Lender" or "Lenders" or any similar term shall, unless the context clearly
otherwise indicates, include the Administrative Agent in its individual
capacity. Each of the Arranger, the Documentation Agent and the Administrative
Agent and their respective Affiliates may accept deposits from, lend money to
and generally engage in any kind of banking, trust, financial advisory or other
business with the Company or any of its Affiliates as if it were not performing
the duties specified herein, and may accept fees and other consideration from
the Company for services in connection with this Agreement and otherwise without
having to account for the same to Lenders.
53
10.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness. Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of the Company
and its Subsidiaries in connection with the making of the Loans hereunder and
that it has made and shall continue to make its own appraisal of the
creditworthiness of the Company and its Subsidiaries. Neither the Arranger, the
Documentation Agent nor the Administrative Agent shall have any duty or
responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter, and neither the Arranger, the Documentation Agent nor the
Administrative Agent shall have any responsibility with respect to the accuracy
of or the completeness of any information provided to Lenders.
10.4 Right to Indemnity. Each Lender, in proportion to its Committed
Percentage, severally agrees to indemnify each of the Arranger, the
Documentation Agent and the Administrative Agent, to the extent that such agent
shall not have been reimbursed by Company, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements) or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by or asserted
against such agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Loan Documents or otherwise in its
capacity as such agent in any way relating to or arising out of this Agreement
or the other Loan Documents; provided that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such agent's
gross negligence or willful misconduct. If any indemnity furnished to the
Arranger, the Documentation Agent and the Administrative Agent for any purpose
shall, in the opinion of such agent, be insufficient or become impaired, such
agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished; provided
that in no event shall this sentence require any Lender to indemnify the
Arranger, the Documentation Agent or the Administrative Agent against any
liability, obligation, loss, damage, penalty, action, judgment, suit, cost,
expense or disbursement in excess of such Lender's Committed Percentage thereof;
and provided, further, that this sentence shall not be deemed to require any
Lender to indemnify the Arranger, the Documentation Agent or the Administrative
Agent against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement described in the proviso in the
immediately preceding sentence.
10.5 Successor Administrative Agent. The Administrative Agent may resign at
any time by giving 30 days' prior written notice thereof to Lenders and the
Company. Upon any such notice of resignation, Required Lenders shall have the
right, upon five Business Days' notice to the Company, to appoint a successor
Administrative Agent. Upon the acceptance of any appointment as the
Administrative Agent hereunder by a successor Administrative Agent, that
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
54
Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Administrative Agent's resignation hereunder as the
Administrative Agent, the provisions of this Article X shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement.
ARTICLE XI
----------
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
11.1 Successors and Assigns. The terms and provisions of the Loan Documents
shall be binding upon and inure to the benefit of the Company and the Lenders
and their respective successors and assigns, except that (i) the Company shall
not have the right to assign its rights or obligations under the Loan Documents
and (ii) any assignment by any Lender must be made in compliance with Section
11.3. Notwithstanding clause (ii) of this Section, any Lender may at any time,
without the consent of the Company or the Administrative Agent, assign all or
any portion of its rights under this Agreement or the Loan Documents to a
Federal Reserve Bank; provided, however, that no such assignment to a Federal
Reserve Bank shall release the transferor Lender from its obligations hereunder.
The Administrative Agent may treat the payee of any Loan Document as the owner
thereof for all purposes hereof unless and until such payee complies with
Section 11.3 in the case of an assignment thereof or, in the case of any other
transfer, a written notice of the transfer is filed with the Administrative
Agent. Any assignee or transferee of any of the Loans or a Note agrees by
acceptance thereof to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of any of
the Loans or a holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
11.2 Participations.
11.2.1 Permitted Participants; Effect. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time sell to one
or more banks or other entities ("Participants") participating interests in any
Loan owing to such Lender, any Note held by such Lender, any Commitment of such
Lender or any other interest of such Lender under the Loan Documents. In the
event of any such sale by a Lender of participating interests to a Participant,
such Lender's obligations under the Loan Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the holder of any such
Loan or Note for all purposes under the Loan Documents, all amounts payable by
the Company under this Agreement shall be determined as if such Lender had not
sold such participating interests (including without limitation payments with
respect to Non-Excluded Taxes), and the Company and the Administrative Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under the Loan Documents.
55
11.2.2 Voting Rights. Each Lender shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Loan or Commitment in which such Participant has an
interest which would require the consent of all Lenders under Section 8.2.1.
11.2.3 Benefit of Setoff. The Company agrees that each Participant shall be
deemed to have the right of setoff provided in Section 9.14 in respect of its
participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents, provided that each Lender shall retain the
right of setoff provided in Section 9.14 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 9.14, agrees to share with each Lender, any amount received
pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 9.14 as if each Participant were a Lender.
11.3 Assignments.
11.3.1 Permitted Assignments. Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time assign to one or
more banks, finance companies, insurance companies or other financial
institutions or funds that are engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of its business or, after
the occurrence of any Default, any other entity ("Purchasers") all or any part
of its rights and obligations under the Loan Documents. Such assignment shall be
substantially in the form of Exhibit H annexed hereto (an "Assignment") or in
such other form as may be agreed to by the parties thereto. The consent of the
Company and the Administrative Agent shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not a Lender or an
Affiliate thereof; provided, however, that if a Default has occurred and is
continuing, the consent of the Company shall not be required. Such consent by
the Company shall not be unreasonably withheld or delayed. Each such assignment
shall be in an amount not less than the lesser of (i) $5,000,000 and in integral
multiples of $1,000,000 thereafter, or (ii) the remaining amount of the
assigning Lender's Commitment (calculated as at the date of such assignment).
11.3.2 Effect; Effective Date. Upon (i) delivery to the Administrative Agent
of a notice of assignment, substantially in the form attached as Exhibit I to
Exhibit H annexed hereto (a "Notice of Assignment"), together with any consents
required by Section 11.3.1, and (ii) payment of a $2,500 fee to the
Administrative Agent for processing such assignment (provided that such fee
shall not be required if such assignment is to an existing Lender or an
Affiliate thereof), such assignment shall become effective on the effective date
specified in such Notice of Assignment. The Notice of Assignment shall contain a
representation by the Purchaser to the effect that none of the consideration
used to make the purchase of the Commitment and Loans under the applicable
assignment agreement are "plan assets" as defined under ERISA and that the
fights and interests of the Purchaser in and under the Loan Documents will not
be "plan
56
assets" under ERISA. On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by the Lenders and shall have all the rights and
obligations of a Lender under the Loan Documents, to the same extent as if it
were an original party hereto, and no further consent or action by the Company,
the Lenders or the Administrative Agent shall be required to release the
transferor Lender with respect to the percentage of the Aggregate Commitments
and Loans assigned to such Purchaser. Upon the consummation of any assignment to
a Purchaser pursuant to this Section 11.3.2, the transferor Lender, the
Administrative Agent and the Company shall make appropriate arrangements so that
replacement Notes, if applicable, are issued to such transferor Lender and new
Notes or, as appropriate, replacement Notes, are issued to such Purchaser, in
each case in principal amounts reflecting their Commitments, as adjusted
pursuant to such assignment.
11.4 Dissemination of Information. The Company authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Company and its Subsidiaries provided
that each Transferee and prospective Transferee agrees to be bound by Section
9.12.
11.5 Tax Treatment. If any interest in any Loan Document is transferred to
any Transferee which is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.6.
ARTICLE XII
-----------
NOTICES
-------
12.1 Giving Notices. Except as otherwise permitted by Article II with
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, facsimile
transmission or similar writing) and shall be given to such party: (x) in the
case of the Company, the Arranger or the Administrative Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of any
Lender, at its address or facsimile number set forth in Schedule 1 hereto or
otherwise established pursuant to an Assignment or (z) in the case of any party,
such other address or facsimile number as such party may hereafter specify for
the purpose by notice to the Administrative Agent and the Company. Each such
notice, request or other communication shall be effective (i) if given by
facsimile transmission, when transmitted to the facsimile number specified in
this Section and confirmation of receipt is received, (ii) if given by mail, 72
hours after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (iii) if given by any other means,
when delivered at the address specified in this Section; provided that notices
to the Administrative Agent under Article II shall not be effective until
received.
57
12.2 Change of Address. The Company, the Arranger, the Administrative Agent
and any Lender may each change the address for service of notice upon it by a
notice in writing to the other parties hereto.
ARTICLE XIII
------------
COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Company, the
Arranger, the Administrative Agent and the Lenders and each party has notified
the Administrative Agent by telex or telephone, that it has taken such action.
ARTICLE XIV
-----------
CHOICE OF LAW, CONSENT TO JURISDICTION,
---------------------------------------
WAIVER OF JURY TRIAL
--------------------
14.1 Choice of Law. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF NEW YORK, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
14.2 Waiver of Jury Trial. THE COMPANY, THE ADMINISTRATIVE AGENT AND EACH
LENDER HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
14.3 Submission to Jurisdiction; Waivers. The Company hereby irrevocably and
unconditionally:
(i) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan
Documents to which it is a party, or for recognition and
enforcement of any judgment in respect thereof to the
non-exclusive general jurisdiction of the courts of the State
of New York in New York County, the courts of the United
States of America for the Southern District of New York, and
appellate courts from any thereof;
(ii) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or
hereafter have to the venue of any such
58
action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not
to plead or claim the same;
(iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar
form of mail), postage prepaid, to the Company at the address
specified in Section 12.1, or at such other address of which
the Administrative Agent shall have been notified pursuant
thereto;
(iv) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or
shall limit the right to xxx in any other jurisdiction; and
(v) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or
proceeding referred to in this Section any special, exemplary,
punitive or consequential damages.
14.4 Acknowledgments. The Company hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and delivery
of this Agreement and the other Loan Documents;
(b) none of the Arranger, the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Company arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between the Administrative Agent and the Lenders, on the one hand,
and the Company, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Company and the Lenders.
59
IN WITNESS WHEREOF, the Company, the Lenders, the Arranger,
the Administrative Agent and the Documentation Agent have executed this
Agreement as of the date first above written.
MERITOR AUTOMOTIVE, INC.
By: /s/ Xxxxxx X. Xxxxx
-----------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President & Treasurer
Notice Address:
0000 Xxxx Xxxxx Xxxx
Xxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-1
WARBURG DILLON READ LLC,
as Arranger
By: /s/ X.X. Xxxxxx, Xx.
----------------------------
Name: X.X. Xxxxxx, Xx.
Title: Managing Director
By: /s/ X.X. Xxxx
----------------------------
Name: X.X. Xxxx
Title: Executive Director
Notice Address:
6th Floor, Trading
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxxxxxx Xxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-2
UBS AG, STAMFORD BRANCH,
individually and as
Administrative Agent
By: /s/ Xxxxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxxxx X. Xxxxxxxxx
Title: Director
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Director
Notice Address:
UBS AG, New York Branch
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-3
BANK OF AMERICA NT & SA
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: Managing Director
Credit Contact
--------------
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Operating Contact
-----------------
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
X-0
XXX XXXX XX XXXX XXXXXX
By: /s/ F.C.H. Xxxxx
----------------------------
Name: F.C.H. Xxxxx
Title: Senior Manager Loan
Operations
Notice Address:
Credit Contact:
000 X. Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Operations Contact:
000 Xxxxxxxxx Xxxxxx XX, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-5
COMERICA BANK
By: /s/ Xxxx X. Xxxxxxxx
----------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
Notice Address:
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
X-0
XXXXXXXX XXXX XX, XXX XXXX
BRANCH AND/OR CAYMAN ISLANDS
BRANCH
By: /s/ Xxxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Director
By: /s/ Xxxxx X. Xxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
Notice Address:
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Deutsche Bank AG, New York Branch
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx,
Corporate Finance
Services
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-7
FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxxxxx X. Xxxxxxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: First Vice President
Notice Address:
Corporate Banking, STE 8074
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
NBD BANK, as Documentation Agent
By: /s/ Xxxxxxx X. Xxxxxxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: First Vice President
Notice Address:
Corporate Banking, STE 8074
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-8
