Exhibit 99.1
EXECUTION COPY
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$1,500,000,000
AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN FACILITY AGREEMENT
Dated as of February 22, 2001,
As amended and restated as of October 4, 2001,
among
AGERE SYSTEMS INC.,
THE LENDERS PARTY HERETO,
XXXXXXX XXXXX XXXXXX INC., as Syndication Agent, and
THE CHASE MANHATTAN BANK, as Administrative Agent
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X.X. XXXXXX SECURITIES INC. and
XXXXXXX XXXXX BARNEY INC.,
as Co-Lead Arrangers and Co-Bookrunners
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Table of Contents
Page
ARTICLE I Definitions.........................................................1
SECTION 1.01 Defined Terms...........................................1
SECTION 1.02 Terms Generally.........................................15
SECTION 1.03 Accounting Terms; GAAP..................................16
SECTION 1.04 Schedule 2.10...........................................16
ARTICLE II The Credits........................................................16
SECTION 2.01 Commitments; Loans......................................16
SECTION 2.02 Revolving Loans.........................................16
SECTION 2.03 Borrowing Procedure.....................................17
SECTION 2.04 Conversion and Continuation of Loans....................18
SECTION 2.05 Fees....................................................19
SECTION 2.06 Repayment of Loans, Evidence of Debt....................19
SECTION 2.07 Interest on Loans.......................................20
SECTION 2.08 Default Interest........................................20
SECTION 2.09 Alternate Rate of Interest..............................20
SECTION 2.10 Optional and Mandatory Termination and
Reduction of Commitments; Prepayments of
Term Loans in Connection with Certain Transactions......21
SECTION 2.11 Optional and Mandatory Repayment........................22
SECTION 2.12 Reserve Requirements, Change in Circumstances...........23
SECTION 2.13 Change in Legality......................................24
SECTION 2.14 Indemnity...............................................24
SECTION 2.15 Pro Rata Treatment......................................25
SECTION 2.16 Sharing of Setoff.......................................25
SECTION 2.17 Payments................................................26
SECTION 2.18 Taxes...................................................26
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Page
SECTION 2.19 Mandatory Assignment; Commitment Termination............28
SECTION 2.20 Extension of Maturity Date..............................28
SECTION 2.21 Conversion to Term Loans................................28
ARTICLE III Representations and Warranties....................................29
SECTION 3.01 Organization; Powers....................................29
SECTION 3.02 Authorization...........................................29
SECTION 3.03 Enforceability..........................................29
SECTION 3.04 Governmental Approvals..................................29
SECTION 3.05 Financial Statements....................................29
SECTION 3.06 Properties..............................................30
SECTION 3.07 Litigation and Environmental Matters....................30
SECTION 3.08 Compliance with Laws and Agreements.....................30
SECTION 3.09 Federal Reserve Regulations.............................30
SECTION 3.10 Investment Company Act; Public Utility
Holding Company Act.....................................31
SECTION 3.11 Taxes...................................................31
SECTION 3.12 ERISA...................................................31
SECTION 3.13 Labor Matters...........................................31
SECTION 3.14 Subsidiaries............................................31
SECTION 3.15 Use of Proceeds.........................................31
SECTION 3.16 No Material Misstatements...............................31
SECTION 3.17 Ownership of Intellectual Property......................32
ARTICLE IV Conditions of Lending; Conditions Relating to Amendment ...........32
and Restatement....................................................32
SECTION 4.01 All Borrowings..........................................32
SECTION 4.02 Amendment and Restatement Conditions....................32
ARTICLE V Affirmative Covenants...............................................33
SECTION 5.01 Existence...............................................33
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Page
SECTION 5.02 Financial Statements, Reports, etc......................34
SECTION 5.03 Maintaining Records.....................................35
SECTION 5.04 Notices of Material Events..............................35
SECTION 5.05 Existence; Conduct of Business..........................35
SECTION 5.06 Payment of Obligations..................................35
SECTION 5.07 Maintenance of Properties; Insurance....................35
SECTION 5.08 Inspection Rights.......................................36
SECTION 5.09 Compliance..............................................36
SECTION 5.10 Use of Proceeds.........................................36
SECTION 5.11 Additional Subsidiary Guarantors........................36
ARTICLE VI Negative Covenants.................................................36
SECTION 6.01 Financial Covenants.....................................36
SECTION 6.02 Subsidiary Indebtedness.................................38
SECTION 6.03 Liens...................................................39
SECTION 6.04 Fundamental Changes.....................................40
SECTION 6.05 Investments, Loans, Advances, Guarantees
and Acquisitions........................................40
SECTION 6.06 Restricted Payments.....................................42
SECTION 6.07 Transactions with Affiliates............................42
SECTION 6.08 Limitations on Sale and Leaseback Transactions
and CMO Transactions....................................42
SECTION 6.09 Intercompany Transfers of Intellectual Property.........42
SECTION 6.10 Maintenance of Cash, Cash Equivalents and
Financial Asset Management Arrangements.................43
SECTION 6.11 Certain Agreements with Respect to Indebtedness.........44
ARTICLE VII Events of Default.................................................45
ARTICLE VIII The Administrative Agent.........................................47
ARTICLE IX Miscellaneous......................................................49
SECTION 9.01 Notices.................................................49
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Page
SECTION 9.02 Survival of Agreement...................................49
SECTION 9.03 Binding Effect..........................................49
SECTION 9.04 Successors and Assigns..................................49
SECTION 9.05 Expenses; Indemnity.....................................52
SECTION 9.06 Applicable Law.........................................52
SECTION 9.07 Waivers; Amendment......................................52
SECTION 9.08 Entire Agreement........................................53
SECTION 9.09 Severability............................................53
SECTION 9.10 Right of Setoff.........................................53
SECTION 9.11 Counterparts............................................53
SECTION 9.12 Headings................................................53
SECTION 9.13 Release of Guarantees and Liens.........................53
SECTION 9.14 Confidentiality.........................................54
SECTION 9.15 Submission to Jurisdiction..............................54
SECTION 9.16 WAIVER OF JURY TRIAL....................................55
SECTION 9.17 Authorization of Administrative Agent...................55
SECTION 9.18 Amendment of Guarantee and Collateral Agreement.........55
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EXHIBITS
Exhibit A Form of Assignment and Acceptance
Exhibit B Form of Borrowing Request
Exhibit C Form of Closing Certificate
Exhibit D Form of Opinion of Cravath, Swaine & Xxxxx
Exhibit E Guarantee and Collateral Agreement
Exhibit F Form of Consent and Confirmation
SCHEDULES
Schedule 1.01A Commitments
Schedule 1.01B Certain Acquisitions
Schedule 2.10 Allocation Matters
Schedule 3.14 Subsidiaries
Schedule 3.17 Ownership of Intellectual Property
Schedule 6.02 Existing Subsidiary Indebtedness
Schedule 6.03 Existing Liens
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AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN FACILITY
AGREEMENT, dated as of February 22, 2001, as amended and restated as of
October 4, 2001, among AGERE SYSTEMS INC., a Delaware corporation (the
"Borrower"), the several banks and other financial institutions or entities
from time to time parties to this Agreement (the "Lenders"), XXXXXXX XXXXX
BARNEY INC., as Syndication Agent (in such capacity, the "Syndication Agent"),
and THE CHASE MANHATTAN BANK, as administrative agent for the Lenders.
WHEREAS, the Borrower entered into the 364-Day Revolving Credit and
Term Loan Facility Agreement, dated as of February 22, 2001, as amended by the
First Amendment, dated as of August 10, 2001 (as the same may be further
amended, supplemented or otherwise modified prior to the date hereof, the
"Existing Credit Agreement"), with the several banks and other financial
institutions or entities parties thereto, Xxxxxxx Xxxxx Xxxxxx Inc., as
syndication agent, and The Chase Manhattan Bank, as administrative agent;
WHEREAS, the parties hereto have agreed to amend and restate the
Existing Credit Agreement as provided in this Agreement, which Agreement shall
become effective upon the satisfaction of the conditions precedent set forth
in Section 4.02 hereof; and
WHEREAS, it is the intent of the parties hereto that this Agreement
not constitute a novation of the obligations and liabilities existing under
the Existing Credit Agreement or evidence repayment of any of such obligations
and liabilities (except as expressly provided herein) and that this Agreement
amend and restate in its entirety the Existing Credit Agreement and
re-evidence the obligations of the Borrower outstanding thereunder;
NOW, THEREFORE, in consideration of the above premises, the parties
hereto hereby agree that on the Amendment and Restatement Effective Date (as
defined below) the Existing Credit Agreement shall be amended and restated in
its entirety as follows:
ARTICLE I
Definitions
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SECTION 1.01 Defined Terms. As used in this Agreement, the
following terms shall have the meanings specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Loan bearing interest at a rate determined
by reference to the Alternate Base Rate in accordance with the provisions of
Article II.
"Accounts" shall have the meaning given to such term in the Uniform
Commercial Code as in effect in the State of New York; and, with respect to
the Borrower and its Subsidiaries, all such Accounts of such Persons, whether
now existing or existing in the future, including, without limitation, (i) all
accounts receivable of such Person (whether or not specifically listed on
schedules furnished to the Administrative Agent) including, without
limitation, all accounts created by or arising from all of such Person's
Intellectual Property licensing arrangements or sales of goods or rendition of
services made under any of its trade names, or through any of its divisions,
(ii) all unpaid rights of such Person (including rescission, replevin,
reclamation and stopping in transit) relating to the foregoing or arising
therefrom, (iii) all rights to any goods represented by any of the foregoing,
including returned or repossessed goods, (iv) all reserves and credit balances
held by such Person with respect to any such accounts receivable or any
obligors thereon, (v) all letters of credit, guarantees or collateral for any
of the
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foregoing, (vi) all rights to any Intellectual Property related to any of the
foregoing clauses (i) through (v) and (vii) all insurance policies or other
rights related to any of the foregoing.
"Administrative Agent" shall mean The Chase Manhattan Bank, together
with its affiliates, as an arranger of the Revolving Commitments and Term
Loans and as the administrative agent for the Lenders under this Agreement and
the other Loan Documents, together with any of its successors.
"Administrative Questionnaire" shall mean an administrative
questionnaire in a form approved by the Administrative Agent.
"Affiliate" shall mean, when used with respect to a specified
Person, another Person that directly or indirectly Controls or is Controlled
by or is under common Control with the Person specified.
"Agere Distribution" shall mean the distribution to Lucent's
securityholders of all of the common stock of the Borrower held by Lucent
after the Agere IPO; provided that, for purposes of the definition of "Change
in Control", "Agere Distribution" shall mean the first time at which Lucent
shall own less than 50% of the outstanding common stock of the Borrower.
"Agere IPO" shall mean the consummation of an initial public
offering of the common stock of the Borrower.
"Agere Systems Guardian Corp." shall mean Agere Systems Guardian
Corp., a Delaware corporation.
"Alternate Base Rate" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greater
of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof,
"Prime Rate" shall mean the rate of interest per annum publicly announced from
time to time by the Administrative Agent as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced as effective. For
purposes hereof, "Federal Funds Effective Rate" shall mean, for any day, the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers, as
released on the next succeeding Business Day by the Federal Reserve Bank of
New York, or, if such rate is not so released for any day which is a Business
Day, the arithmetic average (rounded upwards to the next 1/100th of 1%), as
determined by the Administrative Agent, of the quotations for the day of such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability or failure of the
Administrative Agent to obtain sufficient quotations in accordance with the
terms thereof, the Alternate Base Rate shall be determined without regard to
clause (b) of the first sentence of this definition until the circumstances
giving rise to such inability no longer exist. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds Effective
Rate shall be effective on the effective date of such change in the Prime Rate
or the Federal Funds Effective Rate, respectively.
"Amendment and Restatement Effective Date" shall mean the date on
which the conditions precedent set forth in Section 4.02 shall have been
satisfied, which date shall occur not later than October 4, 2001.
"Applicable Percentage" shall mean, on any date, the per annum rate
applicable on such date, as determined pursuant to the table set forth below.
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Level I Level II Level III Level IV Level V Level VI
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Baa2/BBB or Baa3/BBB- Ba1/BB+ Ba2/BB Ba3/BB- B1/B+ or less
better
Facility Fee Rate 0.50% 0.50% 0.625% 0.75% 0.75% 0.875%
Eurodollar Revolving Loans 2.25% 2.50% 2.625% 2.75% 3.25% 3.375%
Eurodollar Term Loans 2.75% 3.00% 3.25% 3.50% 4.00% 4.25%
ABR Revolving Loans 1.25% 1.50% 1.625% 1.75% 2.25% 2.375%
ABR Term Loans 1.75% 2.00% 2.25% 2.50% 3.00% 3.25%
The Applicable Percentage shall be based upon the Borrower Debt
Ratings most recently notified to the Administrative Agent by the Borrower. In
the event that (a) the Borrower Debt Ratings fall within different consecutive
Levels, the higher-numbered Level shall apply, (b) the Borrower Debt Ratings
fall within different Levels, and the higher numbered Level is more than one
numbered Level higher than the lower numbered Level, then the next higher
numbered Level from that of the lower numbered Level shall apply, (c) the
Borrower Debt Rating of only one of the Rating Agencies is available, then the
Level determined by such Rating Agency shall apply and (d) a Borrower Debt
Rating is available from neither of the Rating Agencies, then Level VI shall
apply. Notwithstanding anything to the contrary in this definition, on each
date that is 90 days or a whole multiple thereof after the Original Closing
Date, the Applicable Percentage (other than the Facility Fee rate) shall
increase by a further 0.25% above the rate that would otherwise be in effect,
provided, that, effective on the Exposure Reduction Date, such increases shall
cease to apply and the Applicable Percentage shall be as indicated in the
pricing grid above.
"Arrangers" shall mean X.X. Xxxxxx Securities Inc. and Xxxxxxx Xxxxx
Barney Inc.
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit A.
"Attributable Debt" shall mean, as of the date of its determination,
the present value (discounted semiannually at an interest rate implicit in the
terms of the lease) of the obligation of a lessee for rental payments pursuant
to any Sale and Leaseback Transaction (reduced by the amount of the rental
obligations of any sublessee of all or part of the same property) during the
remaining term of such Sale and Leaseback Transaction (including any period
for which the lease relating thereto has been extended), such rental payments
not to include amounts payable by the lessee for maintenance and repairs,
insurance, taxes, assessments and similar charges and for contingent rents
(such as those based on sales); provided, however, that in the case of any
Sale and Leaseback Transaction in which the lease is terminable by the lessee
upon the payment of a penalty, Attributable Debt shall mean the lesser of the
present value of (a) the rental payments to be paid under such Sale and
Leaseback Transaction until the first date (after the date of such
determination) upon which it may be so terminated plus the then applicable
penalty upon such termination and (b) the rental payments required to be paid
during the remaining term of such Sale and Leaseback Transaction (assuming
such termination provision is not exercised).
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"Bond Issuance" shall mean an issuance by the Borrower of debt
securities, on or before September 30, 2002, having no amortization on or
prior to December 31, 2005 in a public offering or private placement yielding
gross proceeds (excluding any proceeds received from any Affiliates unless
such proceeds are applied by the Borrower in accordance with Section 2.10(c)
as if (notwithstanding the exclusion of such proceeds from the definition of
"Net Cash Proceeds") they constituted "Net Cash
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Proceeds") in an aggregate amount of at least $500,000,000 (it being
understood that the terms of such Bond Issuance may include a call prior to
December 31, 2005; provided that, prior to the exercise of such call, the
Borrower shall receive the consent of the Administrative Agent and the
Required Lenders).
"Borrower Debt Rating" shall mean any rating by a Rating Agency with
respect to the senior unsecured non-credit enhanced long-term debt of the
Borrower.
"Borrowing" shall mean a group of Loans of a single Type made by the
Lenders on a single date and as to which a single Interest Period is in
effect.
"Borrowing Request" shall mean a request made pursuant to Section
2.03 in the form of Exhibit B.
"Business Day" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of New York) on which banks are
open for business in New York City; provided, however, that, when used in
connection with a Eurodollar Loan, the term "Business Day" shall also exclude
any day on which banks are not open for dealings in dollar deposits in the
London interbank market.
"Capital Expenditures" shall mean, for any period, the aggregate of
all expenditures by the Borrower and its Subsidiaries for the acquisition or
leasing (pursuant to a capital lease) of fixed or capital assets or additions
to equipment (including replacements, capitalized repairs and improvements
during such period) that should be capitalized under GAAP on a consolidated
balance sheet of the Borrower and its Subsidiaries.
"Capital Lease Obligations" of any Person shall mean the obligations
of such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Capital Markets Event" shall mean the issuance or incurrence after
the Amendment and Restatement Effective Date by the Borrower or any of its
Subsidiaries of equity or of any Indebtedness for borrowed money in respect of
debt securities, in each case, issued in a public offering or a private
placement, but excluding (i) issuances of Capital Stock of the Borrower
pursuant to any compensation plan for directors, employees or consultants of
the Borrower and its Subsidiaries, (ii) issuances of Capital Stock of the
Borrower as part of the consideration paid in connection with a merger,
consolidation or acquisition otherwise permitted hereunder, (iii) common stock
warrants assumed by the Borrower or any of its Subsidiaries from Lucent or any
of its subsidiaries, (iv) refinancings of Indebtedness (other than under this
Agreement) maturing within one year from the date of the refinancing
(regardless of whether the refinancing occurs before or after the maturity
date of the Indebtedness refinanced), (v) working capital facilities entered
into by Foreign Subsidiaries of the Borrower, (vi) commercial paper and other
Short-Term Indebtedness, (vii) any incurrence of Indebtedness by a Foreign
Subsidiary pursuant to Section 6.02(i)(ii) and (viii) intercompany issuances
of Capital Stock to the Borrower or any Subsidiary and intercompany
Indebtedness incurred pursuant to loans made by the Borrower or any
Subsidiary.
"Capital Stock" shall mean any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person (other
than a corporation) and any and all warrants, rights or options to purchase
any of the foregoing.
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"Change in Control" shall mean (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any "person" or "group"
(within the meaning of the Exchange Act and the rules of the SEC thereunder as
in effect on the Original Closing Date), of shares representing more than 30%
of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of Lucent (or after the Agere Distribution, the
Borrower), (b) prior to the Agere Distribution, any Person (other than Lucent)
shall control the Borrower or (c) occupation of a majority of the seats (other
than vacant seats) on the board of directors of Lucent (or, after the Agere
Distribution, the Borrower) by Persons who were neither (i) nominated or
appointed by the board of directors of Lucent (or, after the Agere
Distribution, the Borrower) nor (ii) appointed by directors so nominated or
appointed. For purposes of this definition, "control" of a Person means the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person whether by contract or otherwise.
Following the Agere Distribution, clause (a) of this definition shall not
apply to Lucent's ownership of the capital stock of the Borrower until after
Lucent first owns shares representing less than 30% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of the
Borrower.
"CMO Transaction" shall mean any financing arrangement involving the
issuance of securities supported by Liens (or Indebtedness secured by Liens)
on real estate owned by the Borrower or any Subsidiary.
"Code" shall mean the Internal Revenue Code of 1986, as the same may
be amended from time to time.
"Collateral" shall mean all property of the Loan Parties, now owned
or hereafter acquired, upon which a Lien is purported to be created by any
Security Document.
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum, dated September 2001, relating to Agere and its
Subsidiaries and distributed to certain Lenders in connection with the credit
facility provided hereby.
"Consolidated EBITDA" shall mean for any period, Consolidated Net
Income for such period plus, without duplication and to the extent reflected
as a charge in the statement of such Consolidated Net Income for such period,
the sum of (a) income tax expense, (b) interest expense, amortization or
write-off of debt discount and debt issuance costs and commissions, discounts
and other fees and charges associated with Indebtedness (including the Loans),
(c) depreciation and amortization expense, (d) amortization of intangibles
(including, but not limited to, goodwill) and organization costs, (e) charges
or expenses relating to purchased in-process research and development, (f) the
after-tax effects of up to an aggregate amount during the term of this
Agreement of $775,000,000 of pre-tax business restructuring charges and
related charges and expenses taken by the Borrower after the Amendment and
Restatement Effective Date (with $350,000,000 of such $775,000,000 being taken
in connection with plant closings, in addition to those charges disclosed to
the Lenders prior to Amendment and Restatement Effective Date), (g) the
after-tax effects of up to an aggregate amount during the term of this
Agreement of $165,000,000 of one-time expenses related to the Agere
Distribution (including employee relocation and retention expenses related to
the deferral of the Agere Distribution and facility consolidation), (h) any
extraordinary, unusual or non-recurring non-cash expenses or losses
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, non-cash losses on
sales of assets outside of the ordinary course of business), and (i) any other
non-cash charges, and minus, to the extent included in the statement of such
Consolidated Net Income for such period, the sum of (i) interest income, (ii)
any extraordinary, unusual or non-recurring income or gains (including,
whether or not otherwise includable as a separate item in the statement of
such Consolidated Net Income for such period, gains on the sales of assets
outside of the ordinary course of business) and (iii) any other non-cash
income, all as determined on a consolidated basis.
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"Consolidated Net Income" shall mean, for any period, the
consolidated net income (or loss) of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP; provided that
there shall be excluded the income (or deficit) of any Person accrued prior to
the date it becomes a Subsidiary of the Borrower or is merged into or
consolidated with the Borrower or any of its Subsidiaries.
"Consolidated Net Worth" shall mean, at any date, all amounts that
would, in conformity with GAAP, be included on a consolidated balance sheet of
the Borrower and its Subsidiaries under stockholders' equity at such date plus
any goodwill write-off taken in connection with the acquisitions listed on
Schedule 1.01B plus the after-tax effects of up to an aggregate amount during
the term of this Agreement of $500,000,000 of pre-tax business restructuring
charges and related charges and expenses taken by the Borrower after the
Amendment and Restatement Effective Date (with $350,000,000 of such
$500,000,000 being taken in connection with plant closings, in addition to
those charges disclosed to the Lenders prior to the Amendment and Restatement
Effective Date) minus the difference, at the end of each quarter, between the
value of Tellium stock held by the Borrower at the end of such quarter and (i)
for the fiscal quarter of the Borrower ending September 30, 2001, $154
million; (ii) for the fiscal quarter of the Borrower ending December 31, 2001,
$154 million; and (iii) for the fiscal quarter of the Borrower ending March
31, 2002 or thereafter, $0.
"Contractual Obligation" shall mean, as to any Person, any provision
of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting shares, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
"Conversion Term Loans" shall have the meaning assigned to such term
in Section 2.21.
"Default" shall mean any event or condition which upon notice, lapse
of time or both would constitute an Event of Default.
"dollars" or "$" shall mean lawful money of the United States of
America.
"Domestic Subsidiary" shall mean any Subsidiary of the Borrower
organized under the laws of any jurisdiction within the United States of
America.
"Environmental Laws" shall mean all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or to health and safety matters.
"Environmental Liability" shall mean any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any
Subsidiary directly or indirectly resulting from or based upon (a) violation
of any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to any
Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials into the environment or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.
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"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" shall mean (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b)
the existence with respect to any Plan of an "accumulated funding deficiency"
(as defined in Section 412 of the Code or Section 302 of ERISA), whether or
not waived; (c) the filing pursuant to Section 412(d) of the Code or Section
303(d) of ERISA of an application for a waiver of the minimum funding standard
with respect to any Plan; (d) the incurrence by the Borrower or any of its
ERISA Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA
Affiliate from the PBGC or a plan administrator of any notice relating to an
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of
any liability with respect to the withdrawal or partial withdrawal from any
Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar Borrowing" shall mean a Borrowing comprised of
Eurodollar Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a rate
determined by reference to the LIBO Rate in accordance with the provisions of
Article II.
"Event of Default" shall have the meaning assigned to such term in
Article VII.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Excluded Subsidiary" shall mean the following Non-Wholly Owned
Subsidiaries: Silicon Manufacturing Partners Pte Ltd, LD Fiber Optics LLC,
FiNET Technologies, and Lucent Technologies Semiconductor Marketing Japan.
"Existing Credit Agreement" shall have the meaning assigned to such
term in the recitals hereto.
"Exposure Reduction Date" shall mean the first date after the
Original Closing Date on which the Total Exposure is $1,000,000,000 or less.
"Extension Fee" shall have the meaning assigned to such term in
Section 2.05(c).
"Facility Fee" shall have the meaning assigned to such term in
Section 2.05(a).
"Financial Asset" shall have the meaning set forth in Section
8-102(a)(9) of the Uniform Commercial Code as in effect in the State of New
York from time to time.
8
"Financial Officer" of any corporation shall mean the Chief
Financial Officer, principal accounting officer, Treasurer or Assistant
Treasurer of such corporation.
"Foreign Subsidiary" shall mean any Subsidiary of the Borrower that
is not a Domestic Subsidiary.
"GAAP" shall mean generally accepted accounting principles, applied
on a consistent basis.
"Governmental Authority" shall mean the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantee" of or by any Person (the "guarantor") shall mean any
obligation, contingent or otherwise, of the guarantor guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account
party in respect of any letter of credit or letter of guaranty issued to
support such Indebtedness or obligation; provided, that the term Guarantee
shall not include endorsements for collection or deposit in the ordinary
course of business. The amount of any Guarantee made by any guarantor shall be
deemed to be the lower of (a) an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made
and (b) the maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee, unless such
primary obligation and the maximum amount for which such guarantor may be
liable are not stated or determinable, in which case the amount of such
Guarantee shall be such guarantor's maximum reasonably anticipated liability
in respect thereof as determined by the Borrower in good faith.
"Guarantee and Collateral Agreement" shall mean the Guarantee and
Collateral Agreement, dated as of April 2, 2001, as amended by the First
Amendment, dated as of August 10, 2001, attached hereto as Exhibit E, and by
the Consent and Confirmation, dated as of the Amendment and Restatement
Effective Date, and as the same may be further amended, restated, supplemented
or otherwise modified from time to time, made by each Subsidiary Guarantor in
favor of the Administrative Agent.
"Hazardous Materials" shall mean all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Agreement" shall mean any interest rate protection
agreement, foreign currency exchange agreement, commodity price protection
agreement or other interest or currency exchange rate or commodity price
hedging arrangement.
9
"Indebtedness" of any Person shall mean, without duplication, (a)
all obligations of such Person for borrowed money or with respect to deposits
or advances of any kind, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person upon which interest charges are customarily paid, (d) all obligations
of such Person under conditional sale or other title retention agreements
relating to property acquired by such Person, (e) all obligations of such
Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (f) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such Person, whether or
not the Indebtedness secured thereby has been assumed, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of
such Person, (i) all obligations, contingent or otherwise, of such Person as
an account party in respect of letters of credit and letters of guaranty, (j)
all obligations, contingent or otherwise, of such Person in respect of
bankers' acceptances and (k) to the extent not otherwise included,
indebtedness or similar obligations (including, if applicable, net investment
amounts) pursuant to any Intellectual Property or Receivables securitization.
The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner)
to the extent such Person is liable therefor as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent the terms of such Indebtedness provide that such Person is not liable
therefor.
"Initial Lender" shall mean any Lender hereunder that was a Lender
under the Existing Credit Agreement on February 22, 2001.
"Intellectual Property" shall mean, collectively, all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, and all
rights to xxx at law or in equity for any infringement or impairment thereof,
including the right to receive all proceeds and damages therefrom.
"Interest Payment Date" shall mean, with respect to any Loan, the
last day of the Interest Period applicable thereto and, in the case of a
Eurodollar Loan with an Interest Period of more than three months' duration,
each day that would have been an Interest Payment Date for such Loan had
successive Interest Periods of three months' duration been in effect with
respect thereto and, in addition, the date of any conversion of such Loan to a
Loan of a different Type.
"Interest Period" shall mean (a) as to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing or on the last day of the
immediately preceding Interest Period applicable to such Borrowing, as the
case may be, and ending on the numerically corresponding day (or, if there is
no numerically corresponding day, on the last day) in the calendar month that
is 1, 2, 3 or 6 months thereafter, as the Borrower may elect and (b) as to any
ABR Borrowing, the period commencing on the date of such Borrowing or on the
last day of the immediately preceding Interest Period applicable to such
Borrowing, as the case may be, and ending on the earliest of (i) the next
succeeding March 31, June 30, September 30 or December 31, (ii) the Maturity
Date, and (iii) the date such Borrowing is converted to a Borrowing of a
different Type in accordance with Section 2.04 or repaid or prepaid in
accordance with Section 2.06 or 2.11; provided, however, that if any Interest
Period would end on a day other than a Business Day, such Interest Period
shall be extended to the next succeeding Business Day unless, in the case of
Eurodollar Loans only, such next succeeding Business Day would fall in the
next calendar month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.
Except as provided in Section 2.04, the Interest Period of any Loan (as
defined under the Existing Credit Agreement) outstanding under the Existing
Credit Agreement on the Amendment and Restatement Effective Date shall remain
the same hereunder as thereunder.
10
"Investments" shall have the meaning set forth in Section 6.05.
"Lender Hedging Agreement" shall mean any Hedging Agreement to which
a Lender or an Affiliate of a Lender is a party and to which or in respect of
which the Borrower is a party or a guarantor.
"LIBO Rate" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, the rate appearing on Page 3750 of the Telerate Service
(or on any successor or substitute page of such Service, or any successor to
or substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market)
at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is
not available at such time for any reason, then the "LIBO Rate" with respect
to such Eurodollar Borrowing for such Interest Period shall be the rate at
which dollar deposits of $5,000,000 and for a maturity comparable to such
Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to
the commencement of such Interest Period.
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed
of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic
effect as any of the foregoing) relating to such asset and (c) in the case of
securities, any purchase option, call or similar right of a third party with
respect to such securities.
"Liquidity" shall mean, at any date, the sum of (i) the aggregate
amount of cash, cash equivalents and Financial Assets maintained by the
Borrower in accordance with Section 6.10 at such date and (ii) the Revolving
Commitments then in effect minus the outstanding Revolving Loans at such date.
"Liquidity Event" shall mean any sale or other disposition by the
Borrower or any of its Subsidiaries of any assets (except for the sale of
inventory and the disposal of excess or obsolete property, machinery and
equipment in the ordinary course of business), including the Tellium
Monetization, any CMO Transaction, any Intellectual Property or Receivables
securitization or licensing of Intellectual Property or any Sale and Leaseback
Transaction, in each case outside the ordinary course of business.
"Loan" shall mean any Revolving Loan or Term Loan.
"Loan Documents" shall mean this Agreement and the Security
Documents.
"Loan Parties" shall mean the Borrower and each Subsidiary
Guarantor.
"Lucent" shall mean Lucent Technologies Inc., a Delaware
corporation.
"Margin Regulations" shall mean Regulations T, U and X of the Board
as from time to time in effect, and all official rulings and interpretations
thereunder or thereof.
"Margin Stock" shall have the meaning given such term under
Regulation U of the Board.
11
"Material Adverse Effect" shall mean a materially adverse effect on
the business, assets, operations or condition, financial or otherwise, of the
Borrower and its Subsidiaries taken as a whole. It is understood that (i)
failure by Lucent to consummate the Agere Distribution and (ii) a change in
the Borrower Debt Ratings or other credit ratings by any rating agency shall
not, in each case in and of itself, constitute a Material Adverse Effect.
"Material Capital Markets Event" shall mean the completion by the
Borrower of one or more Capital Markets Events (which may or may not include
the Bond Issuance), yielding gross proceeds (excluding any proceeds received
from any Affiliates unless such proceeds are applied by the Borrower in
accordance with Section 2.10(c) as if (notwithstanding the exclusion of such
proceeds from the definition of "Net Cash Proceeds") they constituted "Net
Cash Proceeds") in an aggregate amount of at least $500,000,000 (i) on terms
and conditions reasonably satisfactory to the Administrative Agent as
determined before the information memorandum or prospectus with respect to
such Capital Markets Event is distributed to potential investors and (ii)
which terms and conditions are not amended, supplemented or otherwise modified
in a manner materially adverse to the Lenders after the date of such
determination (it being understood that, subject to the maturity being no
earlier than September 30, 2005, any modification of the maturity, the amount
or the percentage yield shall not be considered as so materially adverse for
purposes of this clause (ii)).
"Material Domestic Subsidiary" shall mean any Domestic Subsidiary
that is a Material Subsidiary.
"Material Foreign Subsidiary" shall mean any Foreign Subsidiary that
is a Material Subsidiary.
"Material Indebtedness" shall mean Indebtedness (other than the
Loans), or obligations in respect of one or more Hedging Agreements, of any
one or more of the Borrower and its Subsidiaries in an aggregate principal
amount exceeding $100,000,000. For purposes of determining Material
Indebtedness, the "principal amount" of the obligations of the Borrower or any
Subsidiary in respect of any Hedging Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the
Borrower or such Subsidiary would be required to pay if such Hedging Agreement
were terminated at such time.
"Material Subsidiary" shall mean any Subsidiary of the Borrower the
assets or revenues of which are, at the time of determination, equal to or
greater than one percent of the consolidated assets or consolidated revenues,
respectively, of the Borrower and its Subsidiaries at such time (determined,
in the case of revenues, in respect of the most recent period of four
consecutive fiscal quarters of the Borrower for which the relevant financial
information is available). Such determinations shall, where applicable, be
made excluding intercompany receivables and revenues that would be eliminated
upon consolidation in accordance with GAAP.
"Maturity Date" shall mean September 30, 2002, provided that such
date shall, in the case of the Non-Bridge Revolving Facility and any
Conversion Term Loans, be extended to September 30, 2004 in the event that the
requirements for such extension set forth in Section 2.20 are satisfied on or
before September 30, 2002.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
12
"Net Cash Proceeds" shall mean, in connection with any transaction
completed after the Amendment and Restatement Effective Date, the cash
proceeds received by the Borrower or any of its Subsidiaries from Persons that
are not Affiliates from such issuance or incurrence, net of reasonable
attorneys' fees, investment banking fees, accountants' fees, underwriting
discounts and commissions and other customary fees and expenses actually
incurred in connection therewith. To the extent that any net amounts described
above are received by a Non-Wholly Owned Subsidiary, only a percentage thereof
equal to the Borrower's direct or indirect percentage ownership interest in
such Subsidiary (or such greater amount as shall have been actually dividended
or otherwise distributed to the Borrower or a Wholly Owned Subsidiary) shall
constitute "Net Cash Proceeds".
"Non-Bridge Revolving Facility" shall mean the Revolving Commitments
of the Lenders as of the Amendment and Restatement Effective Date and the
Revolving Loans thereunder in an aggregate principal amount of $1,000,000,000,
in each case that are allocated to the Non-Bridge pursuant to Schedule 2.10.
"Non-Wholly Owned Subsidiary" shall mean any Subsidiary of the
Borrower that is not a Wholly Owned Subsidiary.
"Obligations" shall mean the unpaid principal of and interest on
(including interest accruing after the maturity of the Loans and interest
accruing after the filing of any petition in bankruptcy, or the commencement
of any insolvency, reorganization or like proceeding, relating to the
Borrower, whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding) the Loans and all other obligations and
liabilities of the Borrower to the Administrative Agent or to any Lender (or,
in the case of Lender Hedging Agreements or cash management arrangements, any
Affiliate of any Lender), 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, any other Loan Document,
any Lender Hedging Agreement, any cash management arrangement (including any
pay-roll obligations) or any other document made, delivered or given in
connection herewith or therewith, whether on account of principal, interest,
fees, indemnities, costs, expenses (including all fees, charges and
disbursements of counsel to the Administrative Agent or to any Lender that are
required to be paid by the Borrower pursuant hereto) or otherwise.
"Optical Insurance" shall mean Optical Insurance Company, a Vermont
corporation, that insures and finances the risks of the Borrower, its
Subsidiaries and Affiliates and others.
"Original Closing Date" shall mean February 22, 2001.
"Permitted Encumbrances" shall mean:
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.06;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 30 days or are being contested in compliance with Section 5.06;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
13
(d) deposits of cash or cash equivalents to secure the performance
of bids, trade contracts, leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature,
in each case in the ordinary course of business;
(e) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of the Borrower or any Subsidiary;
and
(f) unexercised bankers' Liens;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Person" shall mean any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Plan" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower
or any ERISA Affiliate is (or, if such plan were terminated, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section
3(5) of ERISA.
"Rating Agencies" shall mean S&P and Moody's.
"Receivables" shall mean all Accounts and accounts receivable of the
Borrower or any of its Subsidiaries (including any thereof constituting or
evidenced by chattel paper, instruments or general intangibles), and all
proceeds thereof and rights (contractual and other) and collateral related
thereto.
"Register" shall have the meaning given such term in Section
9.04(d).
"Required Lenders" shall mean, at any time, Lenders having Loans and
unused Commitments representing at least 51% of the sum of the aggregate
outstanding principal amount of the Loans and the aggregate amount of the
unused Commitments.
"Requirement of Law" shall mean, 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.
"Responsible Officer" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof responsible for the administration of the obligations
of such corporation in respect of this Agreement.
"Restricted Payment" shall mean any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of Capital Stock of the Borrower, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit,
on account of the purchase, redemption, retirement, acquisition, cancellation
or termination of any such shares of Capital Stock of the Borrower or any
option, warrant or other right to acquire any such shares of Capital Stock of
the Borrower. Notwithstanding the foregoing, (a) dividends paid on, and
amounts paid for the mandatory redemption or retirement of, Capital Stock
issued in connection with a Capital Markets Event or Liquidity Event, so long
as such mandatory redemption or retirement, as applicable, shall not
14
occur before September 30, 2005, (b) payments made in accordance with the
terms of any warrants to purchase shares of Lucent's common stock as in effect
on the Amendment and Restatement Effective Date and (c) repurchases of
forfeited restricted stock shall not constitute Restricted Payments.
"Revolving Commitment" shall mean, as to any Lender, the obligation
of such Lender, if any, to make Revolving Loans in an aggregate principal
amount not to exceed the amount set forth under the heading "Revolving
Commitment" opposite such Lender's name on Schedule 1.01A or in the Assignment
and Acceptance pursuant to which such Lender became a party hereto, as the
same may be changed from time to time pursuant to the terms hereof.
"Revolving Lender" shall mean any Lender holding a Revolving
Commitment or Revolving Loans.
"Revolving Loan" shall have the meaning given such term in Section
2.01.
"Sale and Leaseback Transaction" shall mean any arrangement with any
Person providing for the leasing by the Borrower or any of its Subsidiaries of
any property that has been or is to be sold or transferred by the Borrower or
such Subsidiary to such Person, other than (a) leases between the Borrower and
a Subsidiary or between Subsidiaries of the Borrower and (b) leases of
property executed by the time of, or within 180 days after the latest of, the
acquisition, the completion of construction or improvement of such property,
or the commencement of commercial operation of such property.
"S&P" shall mean Standard and Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc.
"SEC" shall mean the Securities and Exchange Commission.
"Securitization Subsidiary" shall mean any special purpose,
bankruptcy-remote Subsidiary that acquires Intellectual Property or
Receivables, as the case may be, generated by the Borrower or any of its
Subsidiaries and that engages in no operations or activities other than those
related to Intellectual Property or Receivables securitizations, as
applicable.
"Security Documents" shall mean the collective reference to the
Guarantee and Collateral Agreement and all other security documents hereafter
delivered to the Administrative Agent granting a Lien on any property of any
Person to secure the obligations, including the Obligations, and liabilities
of any Loan Party under any Loan Document.
"Short-Term Indebtedness" shall mean any Indebtedness of any Person
(other than under any line of credit or other credit facility) that matures
within one year from the date of its creation and is not renewable or
extendible at the option of such Person (other than pursuant to an extension
option contained in extendible commercial notes or other notes issued in lieu
of commercial paper).
"Subsidiary" shall mean any corporation, partnership, limited
liability company or other entity, a majority of the Voting Shares or other
ownership interests having ordinary voting power (other than only by reason of
the happening of a contingency) of which are at the time owned or controlled,
directly or indirectly, by the Borrower or by one or more Subsidiaries of the
Borrower, excluding (i) any Excluded Subsidiary and (ii) any such Person that
(a) would not constitute a consolidated subsidiary of the Borrower in
accordance with GAAP and (b) is not Controlled (directly or indirectly) by the
Borrower. Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries
of the Borrower.
15
"Subsidiary Guarantors" shall mean each Wholly Owned Material
Domestic Subsidiary that is required by the terms of this Agreement to be a
party to the Guarantee and Collateral Agreement (excluding any Securitization
Subsidiary and Optical Insurance).
"Taxes" shall mean any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.
"Tellium" shall mean Tellium, Inc., a Delaware corporation.
"Tellium Monetization" shall mean the sale of all or any part of the
stock of Tellium held by the Borrower.
"Term Lender" shall mean any Lender holding a Term Loan.
"Term Loan" shall mean, collectively, (a) any "Term Loan" assumed by
the Borrower pursuant to Section 2.01 of the Existing Credit Agreement and (b)
any Conversion Term Loan.
"Total Exposure" shall mean, on any date, the sum of (a) the
aggregate amount of the Revolving Commitments then in effect and (b) the
aggregate principal amount of the Term Loans then outstanding.
"Total Revolving Commitment" shall mean, at any time, the aggregate
amount of Revolving Commitments of the Lenders, as in effect at such time.
"Transactions" shall have the meaning assigned to such term in
Section 3.02.
"Type", when used in respect of any Loan or Borrowing, shall refer
to the Rate by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, "Rate" shall
include the LIBO Rate and the Alternate Base Rate.
"Voting Shares" shall mean, as to shares of a particular
corporation, outstanding shares of stock of any class of such corporation
entitled to vote in the election of directors, excluding shares entitled so to
vote only upon the happening of some contingency.
"Wholly Owned Material Domestic Subsidiary" shall mean any Wholly
Owned Subsidiary of the Borrower that is a Domestic Subsidiary and a Material
Subsidiary.
"Wholly Owned Subsidiary" shall mean, as to any Person, any other
Person all of the Capital Stock of which (other than directors' qualifying
shares required by law) is owned by such Person directly and/or through other
Wholly Owned Subsidiaries.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan,
as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 Terms Generally. For the purposes of this Agreement and
the other Loan Documents, (a) the definitions in Section 1.01 shall apply
equally to both the singular and plural forms of the terms defined; (b)
whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms; (c) the words "include," "includes" and
"including" shall be deemed to be followed by the phrase "without limitation";
(d) the words "asset" and "property" shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible
16
assets and properties, including cash, Capital Stock, securities, revenues,
accounts, leasehold interests and contract rights and (e) references to
agreements or other Contractual Obligations shall, unless otherwise specified,
be deemed to refer to such agreements or Contractual Obligations as amended,
supplemented, restated or otherwise modified from time to time. All references
herein to Articles, Sections, Exhibits and Schedules shall be deemed
references to Articles and Sections of, and Exhibits and Schedules to, this
Agreement unless the context shall otherwise require.
SECTION 1.03 Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the Original Closing Date in GAAP or in the application
thereof on the operation of such provision (or if the Administrative Agent
notifies the Borrower that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith.
SECTION 1.04 Schedule 2.10. The requirements of Schedule 2.10 shall
apply notwithstanding anything to the contrary in this Agreement.
ARTICLE II
The Credits
-----------
SECTION 2.01 Commitments; Loans. Subject to the terms and conditions
and relying upon the representations and warranties herein set forth, each
Lender agrees, severally and not jointly, to make revolving credit loans
(together with any "Revolving Loans" under the Existing Credit Agreement, the
"Revolving Loans") to the Borrower, at any time and from time to time on and
after the Amendment and Restatement Effective Date and until the earlier of
the relevant Maturity Date and the termination of the Revolving Commitment of
such Lender, in an aggregate principal amount (including, to the extent not
repaid on the Amendment and Restatement Effective Date, any Revolving Loans
outstanding on the Amendment and Restatement Effective Date) at any time
outstanding not to exceed such Lender's Revolving Commitment. Such Revolving
Commitments may be terminated or reduced from time to time pursuant to Section
2.10.
Within the foregoing limits, the Borrower may borrow, pay or prepay
and reborrow Revolving Loans hereunder, on and after the Amendment and
Restatement Effective Date and until the Maturity Date, subject to the terms,
conditions and limitations set forth herein.
All "Term Loans" and "Revolving Loans" outstanding under the
Existing Credit Agreement on the Amendment and Restatement Effective Date,
after the repayment contemplated by Section 4.02(g) and any repayment of
estimated Net Cash Proceeds pursuant to the last proviso of Section 2.10(c),
shall remain outstanding hereunder on the terms set forth herein.
Prepayments of the Term Loans may not be reborrowed.
SECTION 2.02 Revolving Loans. (a) Each Revolving Loan shall be made
as part of a Borrowing consisting of Revolving Loans made by the Revolving
Lenders ratably in accordance with their respective Revolving Commitments;
provided, however, that the failure of any Revolving Lender to make any
Revolving Loan shall not in itself relieve any other Revolving Lender of its
obligation to lend
17
hereunder (it being understood, however, that no Revolving Lender shall be
responsible for the failure of any other Revolving Lender to make any
Revolving Loan required to be made by such other Revolving Lender). The
Revolving Loans comprising any Borrowing shall be in an aggregate principal
amount which is an integral multiple of $10,000,000 and not less than
$20,000,000 (or an aggregate principal amount equal to the remaining balance
of the available Revolving Commitments).
(b) Each Borrowing shall be comprised entirely of Eurodollar Loans
or ABR Loans, as the Borrower may request pursuant to Section 2.03. Borrowings
of more than one Type may be outstanding at the same time; provided, however,
that the Borrower shall not be entitled to request any Borrowing which, if
made, would result in an aggregate of more than 20 separate Borrowings
comprised of Eurodollar Loans being outstanding hereunder at any one time. For
purposes of the foregoing, Loans having different Interest Periods, regardless
of whether they commence on the same date, shall be considered separate Loans.
(c) Subject to Section 2.04, each Revolving Lender shall make each
Revolving Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds to the Administrative Agent in New
York, New York, not later than 12:00 noon, New York City time, and the
Administrative Agent shall by 3:00 p.m., New York City time, credit the
amounts so received to the general deposit account of the Borrower with the
Administrative Agent or, if a Borrowing shall not occur on such date because
any condition precedent herein specified shall not have been met, return the
amounts so received to the respective Revolving Lenders. Revolving Loans shall
be made by the Revolving Lenders pro rata in accordance with Section 2.15.
Unless the Administrative Agent shall have received notice from a Revolving
Lender prior to the date of any Borrowing that such Revolving Lender will not
make available to the Administrative Agent such Revolving Lender's portion of
such Borrowing, the Administrative Agent may assume that such Revolving Lender
has made such portion available to the Administrative Agent on the date of
such Borrowing in accordance with this paragraph (c) and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If and to the extent that such Revolving
Lender shall not have made such portion available to the Administrative Agent,
such Lender and the Borrower severally agree to repay to the Administrative
Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Administrative Agent at
(i) in the case of the Borrower, the interest rate applicable at the time to
the Revolving Loans comprising such Borrowing and (ii) in the case of such
Revolving Lender, the Federal Funds Effective Rate. If such Revolving Lender
shall repay to the Administrative Agent such corresponding amount, such amount
shall constitute such Revolving Lender's Revolving Loan as part of such
Borrowing for purposes of this Agreement.
SECTION 2.03 Borrowing Procedure. In order to request a Borrowing of
Revolving Loans, the Borrower shall hand deliver or telecopy to the
Administrative Agent a duly completed Borrowing Request (a) in the case of a
Eurodollar Borrowing, not later than 10:30 a.m., New York City time, three
Business Days before a proposed Borrowing and (b) in the case of an ABR
Borrowing, not later than 10:30 a.m., New York City time, on the day of a
proposed Borrowing. Such notice shall be irrevocable and shall in each case
specify (i) whether the Borrowing then being requested is to be a Eurodollar
Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which shall be
a Business Day) and the amount thereof; and (iii) if such Borrowing is to be a
Eurodollar Borrowing, the Interest Period with respect thereto, which shall
not end after the Maturity Date. If no election as to the Type of Borrowing is
specified in any such notice, then the requested Borrowing shall be an ABR
Borrowing. If no Interest Period with respect to any Eurodollar Borrowing is
specified in any such notice, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration. Notwithstanding any other
provision of this Agreement to the contrary, the Borrower shall not be
entitled to request any Borrowing if the Interest Period requested with
respect to such Borrowing would end after the Maturity
18
Date. The Administrative Agent shall promptly advise the Revolving Lenders of
any notice given pursuant to this Section 2.03 and of each Lender's portion of
the requested Borrowing.
SECTION 2.04 Conversion and Continuation of Loans. The Borrower
shall have the right at any time upon prior irrevocable notice to the
Administrative Agent (i) not later than 10:30 a.m., New York City time, on the
day of the conversion, to convert all or any part of any Eurodollar Borrowing
into an ABR Borrowing, (ii) not later than 10:30 a.m., New York City time,
three Business Days prior to conversion or continuation, to convert any ABR
Borrowing into a Eurodollar Borrowing or to continue any Eurodollar Borrowing
as a Eurodollar Borrowing for an additional Interest Period and (iii) not
later than 10:30 a.m., New York City time, three Business Days prior to
conversion, to convert the Interest Period with respect to any Eurodollar
Borrowing to another permissible Interest Period, subject in each case to the
following:
(a) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, the aggregate principal amount of
the Borrowing converted or continued shall be an integral multiple of
$10,000,000 and not less than $20,000,000;
(b) accrued interest on a Borrowing (or portion thereof) being
converted shall be paid by the Borrower at the time of conversion;
(c) if any Eurodollar Borrowing is converted at a time other than
the end of the Interest Period applicable thereto, the Borrower shall pay,
upon demand, any amounts due to the Lenders pursuant to Section 2.14;
(d) any portion of a Borrowing maturing or required to be repaid in
less than one month may not be converted into or continued as a Eurodollar
Borrowing;
(e) any portion of a Eurodollar Borrowing which cannot be continued
as a Eurodollar Borrowing by reason of clause (d) above shall be automatically
converted at the end of the Interest Period in effect for such Eurodollar
Borrowing into an ABR Borrowing;
(f) no Interest Period may be selected for any Eurodollar Borrowing
that would end later than the relevant Maturity Date for such Borrowing; and
(g) at the request of the Required Lenders to the Administrative
Agent, no Borrowing shall be continued as or converted into a Eurodollar
Borrowing at any time when an Event of Default has occurred and is continuing
and, upon such request, each Eurodollar Borrowing shall be converted into an
ABR Borrowing at the end of the Interest Period applicable thereto.
Each notice of the Borrower pursuant to this Section 2.04 shall be
irrevocable and shall refer to this Agreement and specify (i) the identity and
amount of the Borrowing that the Borrower requests to be converted or
continued, (ii) whether such Borrowing is to be converted to or continued as a
Eurodollar Borrowing or an ABR Borrowing, (iii) if such notice requests a
conversion, the date of such conversion (which shall be a Business Day) and
(iv) if such Borrowing is to be converted to or continued as a Eurodollar
Borrowing, the Interest Period with respect thereto. If no Interest Period is
specified in any such notice with respect to any conversion to or continuation
as a Eurodollar Borrowing, the Borrower shall be deemed to have selected an
Interest Period of one month's duration. If the Borrower shall not have given
notice in accordance with this Section 2.04 to convert or continue any
Borrowing, such Borrowing shall, at the end of the Interest Period applicable
thereto (unless repaid pursuant to the terms hereof), automatically be
converted or continued into a new Interest Period as an ABR Borrowing.
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It is understood that the procedures described in this Section 2.04 apply to
Term Loans as well as Revolving Loans.
SECTION 2.05 Fees. (a) The Borrower agrees to pay to each Revolving
Lender, through the Administrative Agent, on each March 31, June 30, September
30 and December 31 (with the first payment being due on the first of such
dates after the Amendment and Restatement Effective Date) and on the date on
which the Revolving Commitment of such Lender shall be terminated as provided
herein, a facility fee (the "Facility Fee") equal to the Applicable Percentage
per annum in effect from time to time on the average daily amount of the
Revolving Commitment of such Lender, whether used or unused, during the
preceding quarter (or other period ending with the relevant Maturity Date or
any date on which the Revolving Commitment of such Lender shall be
terminated). All Facility Fees shall be computed on the basis of the actual
number of days elapsed in a year of 365 or 366 days, as the case may be. The
Facility Fee due to each Lender shall commence to accrue on the Amendment and
Restatement Effective Date, and shall cease to accrue on the earlier of the
relevant Maturity Date and the termination of the Revolving Commitment of such
Lender as provided herein; provided, that the Borrower hereby agrees to pay,
on the first payment date after the Amendment and Restatement Effective Date
under this Section 2.05(a), any amounts (including amounts in respect of Term
Commitments) which had accrued and were not paid under Section 2.05(a) of the
Existing Credit Agreement on the Amendment and Restatement Effective Date.
(b) The Facility Fee shall be paid on the dates due, in immediately
available funds, to the Administrative Agent for distribution, if and as
appropriate, among the Lenders. Once paid, none of the Facility Fees shall be
refundable under any circumstances.
(c) The Borrower agrees to pay, through the Administrative Agent, to
each Revolving Lender whose Revolving Commitment under the Non-Bridge
Revolving Facility is extended in accordance with Section 2.20, on September
30, 2002, an extension fee (the "Extension Fee") equal to 0.50% of the amount
of the Revolving Commitment of such Revolving Lender, whether used or unused,
the Maturity Date of which is being extended pursuant to Section 2.20. The
Extension Fee shall be paid on the date due, in immediately available funds,
to the Administrative Agent for distribution among such Revolving Lenders.
Once paid, the Extension Fee shall not be refundable under any circumstances.
SECTION 2.06 Repayment of Loans, Evidence of Debt. (a) The Borrower
hereby agrees that the outstanding principal balance of each Loan shall be
payable on the relevant Maturity Date for such Loan.
(b) Each Loan shall bear interest on the outstanding principal
balance thereof as set forth in Section 2.07.
(c) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to the
appropriate lending office of such Lender resulting from each Loan made by
such lending office of such Lender from time to time, including the amounts of
principal and interest payable and paid such lending office of such Lender
from time to time under this Agreement.
(d) The Administrative Agent shall maintain the Register pursuant to
Section 9.04(d), and a subaccount for each Lender, in which Register and
accounts (taken together) shall be recorded (i) the amount of each Loan made
hereunder, the Type of each Loan made and the Interest Period applicable
thereto, (ii) the amount of any principal or interest due and payable or to
become due and payable from the Borrower to each Lender hereunder and (iii)
the amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender's share thereof.
20
(e) The entries made in the Register and accounts maintained
pursuant to paragraph (c) and (d) of this Section 2.06 shall, to the extent
permitted by applicable law, be prima facie evidence of the existence and
amounts of the obligations of the Borrower therein recorded; provided,
however, that the failure of any Lender or the Administrative Agent to
maintain such account, such Register or such subaccount, as applicable, or any
error therein shall not in any manner affect the obligation of the Borrower to
repay the Loans made to the Borrower by such Lender in accordance with their
terms.
SECTION 2.07 Interest on Loans. (a) Subject to the provisions of
Section 2.08, the Loans comprising each Eurodollar Borrowing shall bear
interest (computed on the basis of the actual number of days elapsed over a
year of 360 days) at a rate per annum equal to the LIBO Rate for the Interest
Period in effect for such Borrowing plus the Applicable Percentage from time
to time in effect.
(b) Subject to the provisions of Section 2.08, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 365 or 366 days, as the case may be, for
periods during which the Alternate Base Rate is determined by reference to the
Prime Rate and 360 days for periods during which the Alternate Base Rate is
determined by reference to the Federal Funds Effective Rate) at a rate per
annum equal to the Alternate Base Rate plus the Applicable Percentage from
time to time in effect.
(c) Interest on each Loan shall be payable on each Interest Payment
Date applicable to such Loan except as otherwise provided in this Agreement.
The applicable LIBO Rate or Alternate Base Rate for each Interest Period or
day within an Interest Period, as the case may be, shall be determined in good
faith by the Administrative Agent, and such determination shall be conclusive
absent manifest error.
SECTION 2.08 Default Interest. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount
becoming due hereunder, whether by scheduled maturity, notice of prepayment,
acceleration or otherwise, the Borrower shall on demand from time to time from
the Administrative Agent pay interest, to the extent permitted by law, on such
defaulted amount up to (but not including) the date of actual payment (after
as well as before judgment) at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 360 days) equal to 2% above the
rate otherwise applicable to ABR Revolving Loans (in the case of principal and
interest in respect of Revolving Loans) or ABR Term Loans (otherwise).
SECTION 2.09 Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing the Administrative Agent shall have
determined in good faith (a) that dollar deposits in the principal amounts of
the Eurodollar Loans comprising such Borrowing are not generally available in
the London interbank market or (b) that reasonable means do not exist for
ascertaining the LIBO Rate, the Administrative Agent shall, as soon as
practicable thereafter, give telecopy notice of such determination to the
Borrower and the Lenders. In the event of any such determination under clauses
(a) or (b) above, until the Administrative Agent shall have advised the
Borrower and the Lenders that the circumstances giving rise to such notice no
longer exist, any request by the Borrower for a Eurodollar Borrowing shall be
deemed to be a request for an ABR Borrowing. In the event a Lender notifies
the Administrative Agent that the rates at which dollar deposits are being
offered will not adequately and fairly reflect the cost to such Lender of
making or maintaining its Eurodollar Loan during such Interest Period, the
Administrative Agent shall notify the Borrower of such notice and until the
Lender shall have advised the Administrative Agent that the circumstances
giving rise to such notice no longer exist, (i) such Eurodollar Loan will
automatically, on the last day of the then existing Interest Period therefore,
convert into an ABR Loan, (ii) any request by the Borrower for a Eurodollar
Borrowing shall be deemed a request for an ABR Borrowing for the same Interest
Period with respect to such Lender and (iii) the obligation of such
21
Lender to make, or to convert, Loans into Eurodollar Loans shall be suspended
until the Administrative Agent shall notify the Borrower that such Lender has
determined that such circumstances no longer exist. Each determination by the
Administrative Agent hereunder shall be in good faith and conclusive absent
manifest error.
SECTION 2.10 Optional and Mandatory Termination and Reduction of
Commitments; Prepayments of Term Loans in Connection with Certain
Transactions. (a) The Revolving Commitments shall be automatically terminated
on the relevant Maturity Date. In the event of any extension of the Maturity
Date for the Non-Bridge Revolving Facility and any Conversion Term Loans, in
each case on the terms set forth in Section 2.20, the Total Exposure shall
automatically be permanently reduced to (i) $750,000,000 on September 30, 2002
and (ii) $500,000,000 on September 30, 2003.
(b) Upon at least three Business Days' prior irrevocable telecopy
notice to the Administrative Agent, the Borrower may at any time in whole
permanently terminate, or from time to time in part permanently reduce, the
Total Revolving Commitment; provided, however, that each partial reduction of
the Total Revolving Commitment shall be in an integral multiple of $10,000,000
and in a minimum principal amount of $20,000,000. Optional reductions of
Revolving Commitments pursuant to this Section 2.10(b) while the Term Loans
remain outstanding shall be accompanied by a prepayment of the Term Loans to
the extent required by Schedule 2.10.
(c) No later than the date that is three Business Days:
(i) after the receipt of the Net Cash Proceeds of any Capital
Markets Event (including the Bond Issuance), the Total Exposure
shall automatically be permanently reduced by an amount equal to 50%
of such Net Cash Proceeds; provided that after the Borrower has
received an aggregate amount of $500,000,000 in Net Cash Proceeds
from any Capital Markets Event (including the Bond Issuance), the
Total Exposure shall automatically be permanently reduced by an
amount equal to 75% of the Net Cash Proceeds of any Capital Markets
Events (including the Bond Issuance) for Net Cash Proceeds in excess
of $500,000,000; provided, further, that after the receipt of an
aggregate amount of $1,000,000,000 in Net Cash Proceeds from the
Bond Issuance and any other Indebtedness (which Indebtedness is
secured pari passu with the Indebtedness under this Agreement) for
borrowed money in respect of debt securities issued in a public
offering or a private placement and, in each case, the application
of such Net Cash Proceeds in accordance with this Section 2.10(c),
the Total Exposure shall automatically be permanently reduced by an
amount equal to 100% of the Net Cash Proceeds of the Bond Issuance
and any other Indebtedness (which Indebtedness is secured pari passu
with the Indebtedness under this Agreement) for borrowed money in
respect of debt securities issued in a public offering or a private
placement for Net Cash Proceeds in excess of $1,000,000,000; and
(ii) after the receipt of any Net Cash Proceeds of any Liquidity
Event, the Total Exposure shall automatically be permanently reduced
by an amount equal to 100% of the Net Cash Proceeds of such
Liquidity Event;
provided, that (A) if, on or before the Amendment and Restatement
Effective Date, the Borrower entered into definitive documentation
with respect to any Capital Markets Event (other than the Bond
Issuance) or any Liquidity Event and if, on the Amendment and
Restatement Effective Date, the Borrower permanently reduced the
Total Exposure by an amount equal to the estimated Net Cash Proceeds
of such Capital Markets Event (other than the Bond Issuance) or
Liquidity Event, as the case may be, then, for purposes
22
of clauses (i) and (ii) above, "Net Cash Proceeds" for such
transaction shall be deemed to be the difference (if positive)
between (I) the Net Cash Proceeds actually received and (II) the
amount of such reduction of the Total Exposure; (B) once the Total
Exposure has been reduced to $500,000,000 or less, the percentage of
Net Cash Proceeds to be applied in respect of clauses (i) and (ii)
above (subject to the "provided further" in clause (i)) shall be
50%; and (C) so long as no Default or Event of Default is in
existence, if the amount of Net Cash Proceeds required to be applied
as described above on a particular date is less than $20,000,000,
such application may, at the option of the Borrower, be deferred
until the next succeeding date on which the aggregate amount of Net
Cash Proceeds required to be applied as described above (including
any deferred amounts) equals at least $20,000,000. Notwithstanding
the foregoing, if the Borrower enters into any credit agreement as a
borrower or a guarantor of monetary obligations (including any
bilateral agreement), any commitments under such credit, bilateral
or other agreement, as the case may be, immediately shall reduce the
Total Exposure on a dollar-for-dollar basis. It is understood that
the concept of "automatic" reductions as applied to Total Exposure
consisting of Term Loans means that Term Loans in the amount so
allocated shall become due and payable on the date such reduction is
required.
(d) In the case of any transaction described in Section 6.08 that
may be consummated only if the Total Exposure is reduced as described therein,
the amount of the reduction so required shall be applied, within three
Business Days of the consummation of the relevant transaction, to so reduce
the Total Exposure.
(e) Reductions in Total Exposure pursuant to Section 2.10(a), (b),
(c) or (d) shall be allocated as provided in Schedule 2.10.
(f) Subject to Schedule 2.10, each reduction in the Total Revolving
Commitment hereunder shall be made ratably among the Lenders in accordance
with their respective Revolving Commitments. The Borrower shall pay to the
Administrative Agent for the account of the Lenders, on the date of each
termination or reduction of the Revolving Commitments, the Facility Fees on
the amount of the Revolving Commitments so terminated or reduced accrued
through the date of such termination or reduction.
SECTION 2.11 Optional and Mandatory Repayment. (a) The Borrower
shall have the right at any time and from time to time to prepay any Borrowing
or any Revolving Loan constituting part of a Borrowing, in whole or in part,
upon giving telecopy notice (or telephone notice promptly confirmed by
telecopy notice) to the Administrative Agent: (i) before 10:00 a.m., New York
City time, three Business Days prior to prepayment, in the case of Eurodollar
Loans and (ii) before 10:00 a.m., New York City time, one Business Day prior
to prepayment, in the case of ABR Loans; provided, however, that each partial
prepayment shall be in an amount which is an integral multiple of $10,000,000
and not less than $20,000,000. Each notice of prepayment from the Borrower
shall specify the prepayment date and the principal amount of each Borrowing
(or portion thereof) to be prepaid, shall be irrevocable and shall commit the
Borrower to prepay such Borrowing (or portion thereof) by the amount stated
therein on the date stated therein. Each optional prepayment of the Term Loans
pursuant to this Section 2.11(a) shall be accompanied by a reduction of the
Revolving Commitments to the extent required by Schedule 2.10.
(b) The Borrower shall prepay the Term Loans to the extent provided
in Sections 2.10(a), (b), (c) and (d).
(c) On the date of any termination or reduction of the Revolving
Commitments pursuant to this Agreement, the Borrower shall pay or prepay so
much of the Borrowings as shall be
23
necessary in order that the aggregate principal amount of the Revolving Loans
outstanding will not exceed the Total Revolving Commitment, after giving
effect to such termination or reduction.
(d) All prepayments under this Section 2.11 shall be subject to
Section 2.14 but otherwise without premium or penalty. All prepayments under
this Section 2.11 shall be accompanied by accrued interest on the principal
amount being prepaid to the date of payment. Subject to Schedule 2.10 and
Section 2.15, the Borrower may direct the application of any prepayment under
this Section 2.11 as among respective Eurodollar Loans outstanding.
SECTION 2.12 Reserve Requirements, Change in Circumstances. (a)
Notwithstanding any other provision herein, if after the Original Closing Date
any change in applicable law or regulation or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall result in the imposition, modification or applicability of any
reserve, special deposit or similar requirement against assets of, deposits
with or for the account of or credit extended by any Lender, or shall result
in the imposition on such Lender or the London interbank market any other
condition affecting this Agreement, such Lender's Commitment or any Eurodollar
Loan made by such Lender, and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Loan
or to reduce the amount of any sum received or receivable by such Lender
hereunder (whether of principal, interest or otherwise) by an amount deemed by
such Lender to be material, then the Borrower will pay to such Lender upon
demand such additional amount or amounts as will compensate such Lender for
such additional costs incurred or reduction suffered.
(b) If any Lender shall have determined that the applicability of
any law, rule, regulation or guideline adopted after the Original Closing Date
pursuant to or arising out of the July 1988 report of the Basle Committee on
Banking Regulations and Supervisory Practices entitled "International
Convergence of Capital Measurement and Capital Standards," or the adoption
after the Original Closing Date of any other law, rule, regulation or
guideline regarding capital adequacy, or any change in any of the foregoing or
in the interpretation or administration of any of the foregoing by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or any
lending office of such Lender) or any Lender's holding company with any
request or directive regarding capital adequacy (whether or not having the
force of law) of any such authority, central bank or comparable agency, has or
would have the effect of reducing the rate of return on such Lender's capital
or on the capital of such Lender's holding company, if any, as a consequence
of this Agreement, such Lender's Commitment or the Loans made by such Lender
pursuant hereto to a level below that which such Lender or such Lender's
holding company could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's policies and the policies
of such Lender's holding company with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to time the
Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender or such Lender's holding company for any such reduction
suffered. It is acknowledged that this Agreement is being entered into by the
Lenders on the understanding that the Lenders will not be required to maintain
capital against their Commitments under currently applicable laws, regulations
and regulatory guidelines.
(c) A certificate of the Lender setting forth such amount or amounts
(including computation of such amount or amounts) as shall be necessary to
compensate the Lender or its holding company as specified in paragraph (a) or
(b) above, as the case may be, shall be delivered to the Borrower and such
amount or amounts may be reviewed by the Borrower. Unless the Borrower
disagrees in good faith with the computation of the amount or amounts in such
certificate, the Borrower shall pay to the Lender, within 10 Business Days
after receipt by the Borrower of such certificate delivered by the Lender, the
amount shown as due on any such certificate. If the Borrower, after receipt of
any such certificate
24
from the Lender, disagrees with the Lender on the computation of the amount or
amounts owed to the Lender pursuant to paragraph (a) or (b) above, the Lender
and the Borrower shall negotiate in good faith to promptly resolve such
disagreement. In either case, however, the Lender shall have a duty to
mitigate the damages that may arise as a consequence of paragraph (a) or (b)
above to the extent that such mitigation will not, in the judgment of the
Lender, entail any cost or disadvantage to the Lender that the Lender is not
reimbursed or compensated for by the Borrower.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to any other period;
provided that if any Lender fails to make such demand within 45 days after it
obtains knowledge of the event giving rise to the demand such Lender shall,
with respect to amounts payable pursuant to this Section 2.12 resulting from
such event, only be entitled to payment under this Section 2.12 for such costs
incurred or reduction in amounts or return on capital from and after the date
45 days prior to the date that such Lender does make such demand. The
protection of this Section shall be available to each Lender regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change or condition which shall have occurred
or been imposed.
SECTION 2.13 Change in Legality. (a) Notwithstanding any other
provision herein, if any change in any law or regulation or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or to give effect to its obligations
as contemplated hereby with respect to any Eurodollar Loan, then, by 30 days'
(or such shorter period as shall be required in order to comply with
applicable law) written notice to the Borrower and to the Administrative
Agent, such Lender may:
(i) declare that Eurodollar Loans will not thereafter be made by
such Lender hereunder, whereupon any request by the Borrower for a
Eurodollar Borrowing shall, as to such Lender only, be deemed a request
for an ABR Loan unless such declaration shall be subsequently withdrawn;
and
(ii) require that all outstanding Eurodollar Loans made by it be
converted to ABR Loans, in which event all such Eurodollar Loans shall be
automatically converted to ABR Loans as of the effective date of such
notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii)
above, all payments and prepayments of principal which would otherwise have
been applied to repay the Eurodollar Loans that would have been made by such
Lender or the converted Eurodollar Loans of such Lender shall instead be
applied to repay the ABR Loans made by such Lender in lieu of, or resulting
from the conversion of, such Eurodollar Loans.
(b) For purposes of this Section 2.13, a notice to the Borrower by
any Lender shall be effective as to each Eurodollar Loan, if lawful, on the
last day of the Interest Period currently applicable to such Eurodollar Loan;
in all other cases such notice shall be effective on the date of receipt by
the Borrower.
SECTION 2.14 Indemnity. The Borrower shall indemnify each Lender
against any out-of-pocket loss or expense which such Lender may sustain or
incur as a consequence of (a) any failure by the Borrower to borrow or to
refinance, convert or continue any Loan hereunder after irrevocable notice of
such borrowing, refinancing, conversion or continuation has been given
pursuant to Section 2.03 or 2.04, (b) any payment, prepayment or conversion,
or an assignment required under Section 2.19, of a Eurodollar Loan by the
Borrower required by any other provision of this Agreement or otherwise made
or
25
deemed made on a date other than the last day of the Interest Period, if any,
applicable thereto, (c) any default by the Borrower in payment or prepayment
of the principal amount of any Loan or any part thereof or interest accrued
thereon, as and when due and payable (at the due date thereof, whether by
scheduled maturity, acceleration, irrevocable notice of prepayment or
otherwise) or (d) the occurrence of any Event of Default.
In the case of a Eurodollar Loan, such out-of-pocket loss or expense
shall be limited to an amount equal to the excess, if any, of (i) its cost of
obtaining the funds for the Loan being paid, prepaid, converted or not
borrowed, converted or continued (based on the LIBO Rate applicable thereto)
for the period from the date of such payment, prepayment conversion or failure
to borrow, convert or continue to the last day of the Interest Period for such
Loan (or, in the case of a failure to borrow, convert or continue, the
Interest Period for such Loan which would have commenced on the date of such
failure) over (ii) the amount of interest that would be realized by the Lender
in reemploying the funds so paid, prepaid, not borrowed, converted or
continued for such period or Interest Period, as the case may be. This Section
shall not apply to ABR Loans.
A certificate of the Lender setting forth such amount or amounts
(including the computation of such amount or amounts) as shall be necessary to
compensate the Lender or its holding company for the out-of-pocket expenses
defined herein shall be delivered to the Borrower and such amount or amounts
may be reviewed by the Borrower. If the Borrower, after receipt of any such
certificate from the Lender, disagrees in good faith with the Lender on the
computation of the amount or amounts owed to the Lender pursuant to this
Section 2.14, the Lender and the Borrower shall negotiate in good faith to
promptly resolve such disagreement.
Each Lender shall have a duty to mitigate the damages to such Lender
that may arise as a consequence of clause (a), (b), (c) or (d) above to the
extent that such mitigation will not, in the judgment of such Lender, entail
any cost or disadvantage to such Lender that such Lender is not reimbursed or
compensated for by the Borrower.
SECTION 2.15 Pro Rata Treatment. Except as required under Sections
2.09, 2.12, 2.13, 2.14, 2.18 and 2.19 or by Schedule 2.10, each Borrowing,
each payment or prepayment of principal of any Borrowing, each payment of
interest on the Loans, each payment of the Facility Fees, each reduction of
the Revolving Commitments and each refinancing or conversion of any Borrowing
with a Borrowing of any Type, shall be allocated pro rata among the Lenders in
accordance with their respective Revolving Commitments (or, if such Revolving
Commitments shall have expired or been terminated, in accordance with the
respective principal amounts of their outstanding Revolving Loans) or Term
Loans, as the case may be. Each Lender agrees that in computing such Lender's
portion of any Borrowing to be made hereunder, the Administrative Agent may,
in its discretion, round each Lender's percentage of such Borrowing to the
next higher or lower whole dollar amount.
SECTION 2.16 Sharing of Setoff. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrower, or pursuant to a secured claim under Section 506 of
Title 11 of the United States Code or other security or interest arising from,
or in lieu of, such secured claim, received by such Lender under any
applicable bankruptcy, insolvency or other similar law or otherwise, or by any
other means (excluding for the purpose of this Section 2.16, Section 2.09,
Section 2.12, Section 2.13, Section 2.14, Section 2.18 and Section 2.19),
obtain payment (voluntary or involuntary) in respect of any Loan or Loans as a
result of which the unpaid principal portion of the Loans of such Lender shall
be proportionately less than the unpaid principal portion of the Loans of any
other Lender, it shall be deemed simultaneously to have purchased from such
other Lender at face value, and shall promptly pay to such other Lender the
purchase price for, a participation in the Loans of such other Lender, so that
the aggregate unpaid principal amount of the Loans and participations
26
in the Loans held by each Lender shall be in the same proportion to the
aggregate unpaid principal amount of all Loans then outstanding as the
principal amount of its Loans prior to such exercise of banker's lien, setoff
or counterclaim or other event was to the principal amount of all Loans
outstanding prior to such exercise of banker's lien, setoff or counterclaim or
other event; provided, however, that, if any such purchase or purchases or
adjustments shall be made pursuant to this Section 2.16 and the payment giving
rise thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustment restored without interest. The Borrower
expressly consents to the foregoing arrangements and agrees that any Lender
holding a participation in a Loan deemed to have been so purchased may
exercise any and all rights of banker's lien, setoff or counterclaim with
respect to any and all moneys owing by the Borrower to such Lender by reason
thereof as fully as if such Lender had made a Loan directly to the Borrower in
the amount of such participation.
SECTION 2.17 Payments. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or the Facility Fee or
other amounts) hereunder, without setoff or counterclaim, from an account in
the United States not later than 12:00 noon, New York City time, on the date
when due in dollars to the Administrative Agent at its offices at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, in immediately available funds.
(b) Whenever any payment (including principal of or interest on any
Borrowing or the Facility Fee or other amounts) hereunder shall become due, or
otherwise would occur, on a day that is not a Business Day, such payment may
be made on the next succeeding Business Day, and such extension of time shall
in such case be included in the computation of interest or the Facility Fee,
if applicable.
SECTION 2.18 Taxes. (a) Any and all payments by the Borrower
hereunder shall be made, in accordance with Section 2.17, free and clear of
and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto imposed by the United States or any political subdivision or taxing
authority thereof, excluding taxes imposed on the Administrative Agent's or
any Lender's (or any transferee's or assignee's, including a participation
holder's (any such entity a "Transferee")) net income and franchise taxes
imposed on the Administrative Agent or any Lender (or Transferee) by the
United States or any political subdivision or taxing authority thereof (all
such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender (or any Transferee) or the Administrative Agent, (i)
the sum payable shall be increased by the amount necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 2.18) such Lender (or Transferee) or the
Administrative Agent (as the case may be) shall receive an amount equal to the
sum it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant taxing authority or other Governmental Authority in
accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement imposed by the United States or any political subdivision or taxing
authority thereof (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Lender (or Transferee) and the
Administrative Agent for the full amount of Taxes and Other Taxes (including
any Taxes or Other Taxes on amounts payable under this Section 2.18) paid by
such Lender (or Transferee) or the Administrative Agent, as the case may be,
with respect to the Borrower and any liability (including penalties, interest
and reasonable
27
out-of-pocket expenses) arising therefrom or with respect thereto (other than
any such liability that results from the gross negligence or willful
misconduct of the Lender (or Transferee) or Agent), whether or not such Taxes
or Other Taxes were correctly or legally asserted by the relevant taxing
authority or other Governmental Authority. Such indemnification shall be made
within 30 days after the date any Lender (or Transferee) or the Administrative
Agent, as the case may be, makes written demand therefor. If the Borrower or
any Lender (or Transferee) or the Administrative Agent shall determine that
Taxes or Other Taxes may not have been correctly or legally assessed by the
relevant taxing authority or other Governmental Authority, and that a Lender
(or Transferee) or the Administrative Agent may be entitled to receive a
refund in respect of Taxes or Other Taxes, it shall promptly notify the other
party of the availability of such refund and such Lender (or Transferee) or
the Administrative Agent shall, within 30 days after receipt of a request by
the Borrower, apply for such refund at the Borrower's expense. If any Lender
(or Transferee) or the Administrative Agent receives a refund or credit or
offset against another tax liability in respect of any Taxes or Other Taxes
for which such Lender (or Transferee) or the Administrative Agent has received
payment from the Borrower hereunder it shall promptly repay such refund or
credit or offset against another tax liability (including any interest
received by such Lender (or Transferee) or the Administrative Agent from the
taxing authority with respect to the refund with respect to such Taxes or
Other Taxes) to the Borrower, net of all out-of-pocket expenses of such
Lender; provided that the Borrower, upon the request of such Lender (or
Transferee) or the Administrative Agent, agrees to return such refund or
credit or offset against another tax liability (plus penalties, interest or
other charges) to such Lender (or Transferee) or the Administrative Agent in
the event such Lender (or Transferee) or the Administrative Agent is required
to repay such refund or credit or offset against another tax liability. For
purposes of the preceding sentence, the Administrative Agent or any Lender
shall determine in good faith and in its discretion the amount of any credit
or offset against another tax liability and shall be under no obligation to
make available to the Borrower any of its tax returns or any other information
that it deems to be confidential.
(d) As soon as practicable after the date of any payment of Taxes or
Other Taxes withheld by the Borrower in respect of any payment to any Lender
(or Transferee) or the Administrative Agent, the Borrower will furnish to the
Administrative Agent, at its address referred to in Section 9.01, the original
or a certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in Section 2.12,
2.14 and this Section 2.18 shall survive the payment in full of the principal
of and interest on all Loans made hereunder.
(f) Each Lender (or Transferee) which is organized outside the
United States shall, prior to the due date of the first payment by the
Borrower to such Lender (or Transferee) hereunder, deliver to the Borrower
such certificates, documents or other evidence, as required by the Code or
Treasury Regulations issued pursuant thereto, including Internal Revenue
Service Form 8-BEN or Form 8-ECI and any other certificate or statement of
exemption required by Treasury Regulation Section 1.1441-1(a) or Section
1.1441-6(c) or any subsequent version thereof, properly completed and duly
executed by such Lender (or Transferee) establishing that such payment is (i)
not subject to withholding under the Code because such payment is effectively
connected with the conduct by such Lender (or Transferee) of a trade or
business in the United States or (ii) totally exempt from United States tax
under a provision of an applicable tax treaty. Each such Lender (or
Transferee) that changes its funding office shall promptly notify the Borrower
of such change and, upon written request from the Borrower, shall deliver any
new certificates, documents or other evidence required pursuant to the
preceding sentence prior to the immediately following due date of any payment
by the Borrower hereunder. Unless the Borrower and the Administrative Agent
have received forms or other documents satisfactory to them indicating that
payments hereunder are not subject to United States withholding tax,
notwithstanding paragraph (a), the Borrower or the Administrative Agent shall
withhold taxes from such payments at the
28
applicable statutory rate in the case of payments to or for any Lender (or
Transferee) organized under the laws of a jurisdiction outside the United
States.
(g) The Borrower shall not be required to pay any additional amounts
to any Lender (or Transferee) in respect of Taxes and Other Taxes pursuant to
paragraphs (a), (b) and (c) above if the obligation to pay such additional
amounts would not have arisen but for a failure by such Lender (or Transferee)
to comply with the provisions of paragraph (f) above unless such Lender (or
Transferee) is unable to comply with paragraph (f) because of (i) a change in
applicable law, regulation or official interpretation thereof or (ii) an
amendment, modification or revocation of any applicable tax treaty or a change
in official position regarding the application or interpretation thereof, in
each case after the Original Closing Date (and, in the case of a Transferee,
after the date of assignment or transfer).
(h) Any Lender (or Transferee) claiming any additional amounts
payable under this Section 2.18 shall (i) to the extent legally able to do so,
upon written request from the Borrower, file any certificate or document if
such filing would avoid the need for or reduce the amount of any such
additional amounts which may thereafter accrue, and the Borrower shall not be
obligated to pay such additional amounts if, after the Borrower's request, any
Lender (or Transferee) could have filed such certificate or document and
failed to do so; or (ii) consistent with legal and regulatory restrictions,
use reasonable efforts to change the jurisdiction of its applicable lending
office if the making of such change would avoid the need for or reduce the
amount of any additional amounts which may thereafter accrue and would not, in
the sole determination of such Lender (or Transferee), be otherwise
disadvantageous to such Lender (or Transferee).
SECTION 2.19 Mandatory Assignment; Commitment Termination. In the
event any Lender delivers to the Administrative Agent or the Borrower, as
appropriate, a certificate in accordance with Section 2.12(c) or a notice in
accordance with Section 2.09 or 2.13, or the Borrower is required to pay any
additional amounts or other payments in accordance with Section 2.18, the
Borrower may, at its own expense, and in its sole discretion require such
Lender to transfer and assign in whole or in part, without recourse (in
accordance with Section 9.04), all or part of its interests, rights and
obligations under this Agreement to an assignee which shall assume such
assigned obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that (a) such assignment shall not conflict
with any law, rule or regulation or order of any court or other Governmental
Authority and (b) the Borrower or such assignee shall have paid to the
assigning Lender in immediately available funds the principal of and interest
accrued to the date of such payment on the Loans made by it hereunder and all
other amounts owed to it hereunder.
SECTION 2.20 Extension of Maturity Date. So long as (a) on or before
September 30, 2002, a Material Capital Markets Event has occurred
(notwithstanding any other provision set forth in this Agreement, including,
with the consent of the Required Lenders and each Initial Lender, one or more
Capital Markets Events in an aggregate amount of less than $500,000,000 that
would otherwise meet the definition of "Material Capital Markets Event",
provided that at least $250,000,000 of the Net Cash Proceeds of such Capital
Markets Events shall have been applied in accordance with Article II), (b) the
Net Cash Proceeds thereof are applied in accordance with Article II and (c) at
the time of such issuance or incurrence and the application of such Net Cash
Proceeds thereof, no Event of Default has occurred and is continuing, then, on
September 30, 2002, the Maturity Date for the Non-Bridge Revolving Facility
and any Conversion Term Loans automatically shall be extended to September 30,
2004 with the Total Exposure being automatically reduced as set forth in
Section 2.10(a).
SECTION 2.21 Conversion to Term Loans. Three Business Days after (a)
the repayment in full of all Term Loans under the Bridge (as defined in
Schedule 2.10), (b) the termination of the Revolving Commitments under
29
the Bridge and (c) the repayment of all Revolving Loans made under the Bridge,
the following actions shall be taken in the following order (provided that, at
the time of the taking of such actions, the Total Revolving Commitment is
greater than $500,000,000): (i) first, an amount of Revolving Loans equal to
the lesser of (A) the Total Revolving Commitment immediately prior to the
action contemplated in clause (ii) below minus $500,000,000 and (B) the amount
of all outstanding Revolving Loans shall be automatically converted to term
loans (any such Revolving Loans so converted being the "Conversion Term
Loans"), with such conversion being allocated pro rata among the Lenders in
accordance with their respective Revolving Commitments, and (ii) second, the
Total Revolving Commitment shall be automatically reduced to $500,000,000.
ARTICLE III
Representations and Warranties
------------------------------
The Borrower represents and warrants to each of the Lenders that:
SECTION 3.01 Organization; Powers. The Borrower and each of its
Material Domestic Subsidiaries (a) is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, (b) has
all requisite power and authority to own its property and assets and to carry
on its business as now conducted and as proposed to be conducted, (c) is
qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a
Material Adverse Effect, and (d) has the corporate power and authority to
execute, deliver and perform its obligations under each Loan Document to which
it is a party and, in the case of the Borrower, to borrow funds hereunder.
SECTION 3.02 Authorization. The execution, delivery and performance
by each Loan Party of the Loan Documents to which it is a party and the
Borrowings of the Borrower hereunder (collectively, the "Transactions") (a)
have been duly authorized by all requisite corporate actions and (b) will not
(i) violate (A) any provision of any Requirement of Law (including, without
limitation, the Margin Regulations) or of the certificate of incorporation or
other constitutive documents or by-laws of the Borrower or any of its
Subsidiaries (B) any order of any Governmental Authority or (C) any material
Contractual Obligation to which the Borrower or any of its Subsidiaries is a
party or by which the Borrower, any of its Subsidiaries or any of their
property is or may be bound, (ii) be in conflict with, result in a breach of
or constitute (alone or with notice or lapse of time or both) a default under
any such material Contractual Obligation or (iii) result in the creation or
imposition of any lien upon any property or assets of the Borrower or any of
its Subsidiaries.
SECTION 3.03 Enforceability. Each Loan Document has been duly
executed and delivered by each Loan Party party thereto and constitutes a
valid and legally binding obligation of each such Loan Party enforceable
against each such Loan Party in accordance with its terms.
SECTION 3.04 Governmental Approvals. No action, consent or approval
of, registration or filing with or any other action by any Governmental
Authority is or will be required in connection with the Transactions.
SECTION 3.05 Financial Statements. (a) The Borrower has heretofore
furnished to the Administrative Agent and the Lenders copies of its
consolidated financial statements as of and for the fiscal year ended
September 30, 2000, as included in the final prospectus for the Agere IPO.
Such financial statements present fairly, in all material respects, the
consolidated financial condition and the results of operations of the Borrower
as of such date in accordance with GAAP. Neither the Borrower nor any of its
Subsidiaries has any material Guarantee obligations, contingent liabilities
and liabilities for taxes, or any long-term leases or unusual forward or
long-term commitments, including any interest rate
30
or foreign currency swap or exchange transaction or other obligation in
respect of derivatives, that would be required to be reflected in the most
recent financial statements referred to in this paragraph and are not so
reflected.
(b) Since September 30, 2000, there has been no material adverse
change in the business, assets, operations or condition, financial or
otherwise, of the Borrower and its Subsidiaries, taken as a whole, except as
described in the private Confidential Information Memorandum, private Agere
Systems Lenders Meeting Presentation, dated September 17 and 18, 2001, the
final prospectus for the Agere IPO or in the Borrower's subsequent filings
with the SEC (which filings are made at least three Business Days prior to the
Amendment and Restatement Effective Date). It is understood that (i) failure
to consummate the Agere Distribution shall not, in and of itself, constitute
such a material adverse change and (ii) a change in the Borrower Debt Ratings
or other credit ratings by any rating agency shall not, in and of itself,
constitute such a material adverse change.
SECTION 3.06 Properties. (a) Each of the Borrower and its
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to the business of the Borrower and its
Subsidiaries, except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.
(b) Each of the Borrower and its Subsidiaries owns, or is licensed
to use, all trademarks, tradenames, copyrights, patents and other intellectual
property material to the business of the Borrower and its Subsidiaries, and
the use thereof by the Borrower and its Subsidiaries does not infringe upon
the rights of any other Person, except for any such infringements that,
individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect.
SECTION 3.07 Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Subsidiaries (i) as to which
there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (except as disclosed in the
financial statements referred to in Section 3.05(a) or in the Borrower's
subsequent filings with the SEC (which filings are made at least three
Business Days prior to the Amendment and Restatement Effective Date)) or (ii)
that involve any Loan Document or the Transactions.
(b) Except as, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become subject
to any Environmental Liability, (iii) has received notice of any claim with
respect to any Environmental Liability or (iv) knows of any basis for any
Environmental Liability.
SECTION 3.08 Compliance with Laws and Agreements. Each of the
Borrower and its Subsidiaries is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default has
occurred and is continuing.
SECTION 3.09 Federal Reserve Regulations. (a) Neither the Borrower
nor any of its Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing
or carrying Margin Stock.
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(b) No part of the proceeds of any Loan will be used, whether
directly or indirectly, and whether immediately, incidentally or ultimately,
for any purpose which entails a violation of, or which is inconsistent with,
the provisions of the Margin Regulations.
SECTION 3.10 Investment Company Act; Public Utility Holding Company
Act. Neither the Borrower nor any of its Subsidiaries is (a) an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940 or (b) a "holding company" as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935.
SECTION 3.11 Taxes. Each of the Borrower and its Subsidiaries has
timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) any Taxes that are being contested in good faith
by appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves or (b) to the extent
that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.12 ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all
accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not,
as of the date of the most recent financial statements reflecting such
amounts, exceed the fair market value of the assets of such Plan.
SECTION 3.13 Labor Matters. Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes against the Borrower or any of its
Subsidiaries pending or, to the knowledge of the Borrower, threatened; (b)
hours worked by and payment made to employees of the Borrower or any of its
Subsidiaries have not been in violation of the Fair Labor Standards Act or any
other applicable Requirement of Law dealing with such matters; and (c) all
payments due from either the Borrower or any of its Subsidiaries on account of
employee health and welfare insurance have been paid or accrued as a liability
on the books of the Borrower or the relevant Subsidiary.
SECTION 3.14 Subsidiaries. As of the Original Closing Date, (a)
Schedule 3.14 sets forth the name and jurisdiction of incorporation of each
Material Subsidiary and, as to each such Subsidiary, the percentage of each
class of Capital Stock directly owned by any Loan Party and (b) there are no
outstanding subscriptions, options, warrants, calls, rights or other
agreements or commitments (other than stock options or rights granted to
employees, directors or consultants and directors' qualifying shares) of any
nature relating to any Capital Stock of any Material Subsidiary.
SECTION 3.15 Use of Proceeds. All proceeds of the Loans shall be
used for capital expenditures, refunding of debt, support for commercial paper
and general corporate purposes of the Borrower and its Subsidiaries, including
working capital and funding for acquisitions.
SECTION 3.16 No Material Misstatements. No report, financial
statement or other written information furnished by or on behalf of the
Borrower to the Administrative Agent or any Lender pursuant to the
Confidential Information Memorandum or Section 3.05 or 5.02 hereof contains as
of the Original Closing Date in the case of the Confidential Information
Memorandum and Section 3.05, or will contain as of the date furnished in the
case of Section 5.02, any material misstatement of fact or omits or will omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were or will be made (in the case
of Section 5.02(f), when taken as a whole and in conjunction with the
Borrower's and Lucent's public filings and disclosures), not
32
misleading; provided, that the projections and pro forma financial information
contained in the materials referenced above are based upon good faith
estimates and assumptions believed by management of the Borrower to be
reasonable at the time made, it being recognized by the Lenders that such
financial information as it relates to future events is not to be viewed as
fact and that actual results during the period or periods covered by such
financial information may differ from the projected results set forth therein
by a material amount.
SECTION 3.17 Ownership of Intellectual Property. All patents of the
Borrower or any of its Subsidiaries are held by the Borrower or Agere Systems
Guardian Corp. other than as set forth on Schedule 3.17. The Borrower has a
license or a sub-license to use the patents listed on Schedule 3.17. On the
date hereof, the Borrower and Agere Systems Guardian Corp. own at least 95% of
all patents (which patents taken as a whole account for at least 80% of the
patent licensing revenues of the Borrower and its Subsidiaries) then owned by
the Borrower and its Subsidiaries. No patent the loss of which would cause a
Material Adverse Effect is owned by any Subsidiary of the Borrower other than
Agere Systems Guardian Corp. Neither the Borrower nor its Subsidiaries has any
material U.S. copyrights that are registered in the United States of America.
ARTICLE IV
Conditions of Lending; Conditions Relating to Amendment and Restatement
-----------------------------------------------------------------------
The obligations of the Lenders to make Loans hereunder are subject
to the satisfaction of the following conditions:
SECTION 4.01 All Borrowings. On the date of each Borrowing:
(a) The Administrative Agent shall have received a notice of such
Borrowing as required by Section 2.03.
(b) The representations and warranties set forth in Article III
hereof (other than, in the case of any Borrowing exclusively utilized to repay
maturing commercial paper of the Borrower, Sections 3.05(b) and 3.07) shall be
true and correct in all material respects on and as of the date of such
Borrowing with the same effect as though made on and as of such date, except
to the extent such representations and warranties expressly relate to an
earlier date.
(c) The Borrower shall be in compliance with all the terms and
provisions set forth in the Loan Documents in all material respects, and at
the time of and immediately after such Borrowing no Event of Default or
Default shall have occurred and be continuing.
(d) Each Borrowing shall be deemed to constitute a representation
and warranty by the Borrower on the date of such Borrowing as to the matters
specified in paragraphs (b) and (c) of this Section 4.01.
SECTION 4.02 Amendment and Restatement Conditions. On or prior to
the Amendment and Restatement Effective Date:
(a) Credit Agreement. The Administrative Agent shall have received
this Agreement, executed and delivered by the Administrative Agent, the
Syndication Agent, the Borrower and each Person listed on Schedule 1.01A.
33
(b) Approvals. All governmental and third party approvals necessary
or, in the reasonable discretion of the Administrative Agent, advisable in
connection with the Transactions shall have been obtained and be in full force
and effect.
(c) Fees. The Lenders and the Administrative Agent shall have
received all fees required to be paid, and all expenses for which invoices
have been presented (including the reasonable fees and expenses of legal
counsel), on or before the Amendment and Restatement Effective Date.
(d) Closing Certificate. The Administrative Agent shall have
received a certificate of the Borrower, dated the Amendment and Restatement
Effective Date, substantially in the form of Exhibit C, with appropriate
insertions and attachments.
(e) Legal Opinion. The Administrative Agent shall have received the
executed legal opinion of Cravath, Swaine & Xxxxx, counsel to the Borrower,
substantially in the form of Exhibit D, dated the Amendment and Restatement
Effective Date.
(f) Consent and Confirmation. The Administrative Agent shall have
received the Consent and Confirmation, substantially in the form of Exhibit F,
executed and delivered by the Borrower and each Subsidiary Guarantor.
(g) Reduction of Facilities. The Borrower shall have permanently
reduced the Total Exposure under the Existing Credit Agreement with
$1,000,000,000 of cash on hand.
(h) Amendment Fee. The Borrower shall have paid to the
Administrative Agent, on behalf of each Lender, an amendment fee in an amount
equal to 0.75% of the sum of each Lender's Revolving Commitment and Term Loans
then outstanding (after giving effect to the prepayments referred to in
paragraph (g) above and under Section 2.10(c) on the Amendment and Restatement
Effective Date).
(i) Representations and Warranties. The representations and
warranties set forth in Article III hereof shall be true and correct on and as
of the date of the Amendment and Restatement Effective Date with the same
effect as though made on and as of the Amendment and Restatement Effective
Date, except to the extent such representations and warranties expressly
relate to an earlier date (in which case they shall be true and correct on and
as of such earlier date).
(j) No Default or Event of Default. At the time of and immediately
after the Amendment and Restatement Effective Date no Event of Default or
Default shall have occurred and be continuing.
ARTICLE V
Affirmative Covenants
---------------------
The Borrower covenants and agrees with each Lender and the
Administrative Agent that so long as this Agreement shall remain in effect or
the principal of or interest on any Loan, the Facility Fee or any other
expenses or amounts payable hereunder shall be unpaid, unless the Required
Lenders shall otherwise consent in writing:
SECTION 5.01 Existence. The Borrower and each of its Material
Domestic Subsidiaries will do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence, except
as otherwise expressly permitted under Section 6.04 or, in the case of
34
Subsidiaries, to the extent necessary to facilitate intercompany
reorganizations that do not materially adversely affect the interests of the
Lenders.
SECTION 5.02 Financial Statements, Reports, etc. The Borrower will
furnish to the Administrative Agent and each Lender:
(a) within 105 days after the end of each fiscal year, its
consolidated balance sheets and the related statements of income and cash
flows, showing its consolidated financial condition as of the close of such
fiscal year and the consolidated results of its operations during such year,
all audited by PricewaterhouseCoopers LLC or other independent auditors of
recognized national standing and accompanied by an opinion of such auditors to
the effect that such consolidated financial statements fairly present its
financial condition and results of operations on a consolidated basis in
accordance with GAAP consistently applied, except as noted therein;
(b) within 60 days after the end of each of the first three fiscal
quarters of each fiscal year, its consolidated balance sheets and related
statements of income and cash flows, showing its consolidated financial
condition as of the close of such fiscal quarter and the consolidated results
of its operations during such fiscal quarter and the then elapsed portion of
such fiscal year, all certified by one of its Financial Officers as fairly
presenting its financial condition and results of operations on a consolidated
basis in accordance with GAAP consistently applied, subject to normal
recurring accruals, except as noted therein;
(c) concurrently with any delivery of financial statements under
paragraph (a) or (b) above, a certificate of a Financial Officer certifying
that no Event of Default or Default has occurred (including pursuant to the
financial covenants contained in Section 6.01, as demonstrated in reasonable
detail) or, if such an Event of Default or Default has occurred, specifying
the nature and extent thereof and any corrective action taken or proposed to
be taken with respect thereto;
(d) promptly after the same become publicly available, copies of all
reports filed by it with the SEC (other than reports on Form 8-K which are
filed solely for the purpose of filing exhibits), or any Governmental
Authority succeeding to any of or all the functions of the SEC, or distributed
to its shareholders, as the case may be;
(e) until such time as the Guarantees and Collateral of the
Subsidiary Guarantors (other than Agere Systems Guardian Corp.) are released
pursuant to Section 9.13(b) of this Agreement, as soon as available, and in
any event no later than 45 days after the end of each fiscal quarter ending
after the Amendment and Restatement Effective Date, a list of the Material
Subsidiaries in existence on the last Business Day of such quarter; and
(f) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender (through the Administrative Agent) may
reasonably request.
Reports and financial statements required to be delivered pursuant
to paragraphs (a), (b) and (d) of this Section 5.02 shall be deemed to have
been delivered on the date on which the Borrower posts such reports, or
reports containing such financial statements, on the Borrower's website on the
Internet at xxx.xxxxx.xxx or when such reports, or reports containing such
financial statements, are posted on the SEC's website at xxx.xxx.xxx; provided
that the Borrower shall deliver paper copies of the reports and financial
statements referred to in paragraphs (a), (b) and (d) of this Section 5.02 to
the Administrative
35
Agent or any Lender who requests the Borrower to deliver such paper copies
until written notice to cease delivering paper copies is given by the
Administrative Agent or such Lender.
SECTION 5.03 Maintaining Records. The Borrower will record,
summarize and report all financial information in accordance with GAAP.
SECTION 5.04 Notices of Material Events. The Borrower will furnish
to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) any change in any Borrower Debt Rating;
(c) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting the
Borrower or any Affiliate thereof that has a reasonable possibility of being
adversely determined and, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect;
(d) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate
amount exceeding $100,000,000; and
(e) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section (other than clause (b)
above) shall be accompanied by a statement of a Financial Officer or other
executive officer of the Borrower setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.
SECTION 5.05 Existence; Conduct of Business. The Borrower will, and
will cause each of its Material Domestic Subsidiaries to, do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence and the rights, licenses, permits, privileges and
franchises material to the conduct of its business; provided that the
foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution expressly permitted under Section 6.04 or, in the case of
Subsidiaries, undertaken in connection with Investments structured as mergers
or consolidations or to facilitate intercompany reorganizations that do not
materially adversely affect the interests of the Lenders.
SECTION 5.06 Payment of Obligations. The Borrower will, and will
cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, that if not paid, could result in a Material Adverse Effect
before the same shall become delinquent or in default, except where (a) the
validity or amount thereof is being contested in good faith by appropriate
proceedings, (b) the Borrower or such Subsidiary has set aside on its books
adequate reserves with respect thereto in accordance with GAAP and (c) the
failure to make payment pending such contest could not reasonably be expected
to result in a Material Adverse Effect.
SECTION 5.07 Maintenance of Properties; Insurance. The Borrower
will, and will cause each of its Material Subsidiaries to, (a) keep and
maintain all property material to the conduct of the business of the Borrower
and its Subsidiaries in good working order and condition, ordinary wear and
tear excepted, and (b) maintain, with financially sound and reputable
insurance companies, insurance in such
36
amounts and against such risks as are customarily maintained by companies
engaged in the same or similar businesses operating in the same or similar
locations.
SECTION 5.08 Inspection Rights. The Borrower will, and will cause
each of its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and (after reasonable prior notice to the Borrower and subject to the
Borrower's right to participate in such discussions) independent accountants,
all at such reasonable times and as often as reasonably requested.
SECTION 5.09 Compliance. The Borrower will, and will cause each of
its Subsidiaries to, comply with all Requirements of Law (including
Environmental Laws) and Contractual Obligations applicable to it or its
property, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.10 Use of Proceeds. The Borrower will use the proceeds of
the Loans only for the purposes set forth in Section 3.15.
SECTION 5.11 Additional Subsidiary Guarantors. Until such time as
the Guarantees and Collateral of the Subsidiary Guarantors (other than Agere
Systems Guardian Corp.) are released pursuant to Section 9.13(b) of this
Agreement, the Borrower will, with respect to any Subsidiary that becomes a
Wholly Owned Material Domestic Subsidiary (other than (x) any Securitization
Subsidiary and (y) Optical Insurance) after the date the Guarantee and
Collateral Agreement is entered into, cause such new Subsidiary (a) to become
a party to the Guarantee and Collateral Agreement and (b) to deliver to the
Administrative Agent a certificate of such Subsidiary, substantially in the
form of Exhibit C, with appropriate insertions and attachments.
ARTICLE VI
Negative Covenants
------------------
The Borrower covenants and agrees with each Lender and the
Administrative Agent that so long as this Agreement shall remain in effect or
the principal of or interest on any Loan, the Facility Fee or any other
expenses or amounts payable hereunder shall be unpaid, unless the Required
Lenders shall otherwise consent in writing:
SECTION 6.01 Financial Covenants
(a) The Borrower shall not permit Liquidity on any Business Day
during any fiscal quarter of the Borrower to be less than the amount set forth
below opposite such fiscal quarter:
Fiscal Quarter Amount
-------------- ------
September 30, 2001 $ 1,800,000,000
December 31, 2001 $ 1,175,000,000
March 31, 2002 $ 850,000,000
June 30, 2002 $ 625,000,000
September 30, 2002 $ 500,000,000
December 31, 2002 $ 600,000,000
March 31, 2003 $ 650,000,000
June 30, 2003 $ 700,000,000
37
September 30, 2003 $ 750,000,000
December 31, 2003 $ 750,000,000
March 31, 2004 $ 750,000,000
June 30, 2004 $ 750,000,000
September 30, 2004 $ 750,000,000
(b) The Borrower shall not permit Consolidated EBITDA for any fiscal
quarter of the Borrower to be less than the amount set forth below opposite
such fiscal quarter:
Fiscal Quarter Amount
-------------- ------
September 30, 2001 $(275,000,000)
December 31, 2001 $(275,000,000)
March 31, 2002 $(200,000,000)
June 30, 2002 $(100,000,000)
September 30, 2002 $ 5,000,000
December 31, 2002 $ 65,000,000
March 31, 2003 $ 100,000,000
June 30, 2003 $ 150,000,000
September 30, 2003 $ 175,000,000
December 31, 2003 $ 175,000,000
March 31, 2004 $ 200,000,000
June 30, 2004 $ 200,000,000
September 30, 2004 $ 200,000,000
(c) The Borrower shall not permit Consolidated Net Worth at the end
of any fiscal quarter of the Borrower to be less than the amount set forth
below opposite such fiscal quarter:
Fiscal Quarter Amount
-------------- ------
September 30, 2001 $4,900,000,000
December 31, 2001 $4,300,000,000
March 31, 2002 $3,800,000,000
June 30, 2002 $3,400,000,000
September 30, 2002 $3,175,000,000
December 31, 2002 $3,100,000,000
March 31, 2003 $3,000,000,000
June 30, 2003 $3,000,000,000
September 30, 2003 $3,100,000,000
December 31, 2003 $3,200,000,000
March 31, 2004 $3,300,000,000
June 30, 2004 $3,500,000,000
September 30, 2004 $3,700,000,000
(d) The Borrower shall not permit Capital Expenditures for any
fiscal year of the Borrower set forth below to exceed the amount set forth
below opposite such fiscal year:
Year Ended Amount
---------- ------
September 30, 2002 $330,000,000
September 30, 2003 $475,000,000
September 30, 2004 $500,000,000
38
SECTION 6.02 Subsidiary Indebtedness. The Borrower will not permit
any Subsidiary (other than any Excluded Subsidiary) to create, incur, assume
or permit to exist any Indebtedness, except:
(a) Indebtedness existing on the Original Closing Date and set forth
in Schedule 6.02 and extensions, renewals and replacements of any such
Indebtedness that are consummated within one year of the final maturity
thereof (whether before or after such final maturity) and that do not increase
the outstanding principal amount thereof;
(b) Indebtedness created under the Guarantee and Collateral
Agreement;
(c) (i) Indebtedness of any Subsidiary to the Borrower or any other
Subsidiary and (ii) Guarantees by any Subsidiary of Indebtedness of the
Borrower or any Subsidiary;
(d) Indebtedness of any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations, Indebtedness in respect of synthetic
leases and any Indebtedness assumed in connection with the acquisition of any
such assets or secured by a Lien on any such assets prior to the acquisition
thereof, and extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof; provided that
such Indebtedness is incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement;
(e) Indebtedness of any Person that becomes a Subsidiary after the
Original Closing Date, provided that such Indebtedness exists at the time such
Person becomes a Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary and extensions, renewals and
replacements of any such Indebtedness that are incurred by such Subsidiary,
that are consummated within one year of the final maturity thereof (whether
before or after such final maturity) and that do not increase the outstanding
principal amount thereof;
(f) Attributable Debt and Indebtedness pursuant to CMO Transactions
permitted by Section 6.08;
(g) Indebtedness of any Subsidiary as an account party in respect of
trade letters of credit;
(h) Obligations under take or pay or minimum purchase contracts to
the extent constituting Guarantees of Indebtedness of the counterparty
thereto;
(i) (i) Indebtedness incurred pursuant to working capital facilities
entered into by Foreign Subsidiaries of the Borrower and (ii) Indebtedness of
Foreign Subsidiaries other than pursuant to working capital facilities in an
aggregate principal amount not to exceed $50,000,000 at any time outstanding;
(j) Guarantees of loans and advances to officers and employees of
the Borrower and its Subsidiaries in the ordinary course of business;
(k) Indebtedness incurred pursuant to any Intellectual Property or
Receivables securitization; and
(l) other Indebtedness incurred after the Original Closing Date in
an aggregate principal amount not exceeding $25,000,000 at any time
outstanding.
39
SECTION 6.03 Liens. The Borrower will not, and will not permit any
Domestic Subsidiary (other than any Excluded Subsidiary) to, create, incur,
assume or permit to exist any Lien on any property or asset now owned or
hereafter acquired by it, or assign or sell any income or revenues (including
accounts receivable) or rights in respect of any thereof, except:
(a) Permitted Encumbrances;
(b) any judgment Lien in respect of a judgment for the payment of
money; provided that at no time shall the aggregate liability in respect of
all outstanding judgment Liens that have been outstanding for more than 30
consecutive days exceed $100,000,000;
(c) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the Original Closing Date and (in the case of any such
Liens on any property owned by a Loan Party as of the Original Closing Date)
set forth in Schedule 6.03; provided that (i) such Lien shall not apply to any
other property or asset of the Borrower or any Subsidiary and (ii) such Lien
shall secure only those obligations which it secures on the Original Closing
Date and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof;
(d) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the Original
Closing Date prior to the time such Person becomes a Subsidiary; provided that
(i) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (ii)
such Lien shall not apply to any other property or assets of the Borrower or
any Subsidiary and (iii) such Lien shall secure only those obligations which
it secures on the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be and extensions, renewals and replacements
thereof that do not increase the outstanding principal amount thereof;
(e) Liens securing (i) Indebtedness incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and Indebtedness in respect of synthetic
leases (so long as such security interests and the Indebtedness secured
thereby are incurred prior to or within 90 days after such acquisition or the
completion of such construction or improvement) and (ii) extensions, renewals
and replacements of any such Indebtedness that do not increase the outstanding
principal amount thereof; provided that, in each case, such security interests
shall not apply to any other property or assets of the Borrower or any
Subsidiary;
(f) Liens incurred pursuant to Sale and Leaseback Transactions or
CMO Transactions permitted by Section 6.08;
(g) Liens incurred pursuant to Intellectual Property or Receivables
securitizations and related assignments and sales of any income or revenues
(including Intellectual Property and Receivables), including Liens on the
assets of any Securitization Subsidiary created pursuant to any Intellectual
Property or Receivables securitization and Liens incurred by the Borrower and
its other Subsidiaries on Intellectual Property or Receivables to secure
obligations owing by them in respect of any such Intellectual Property or
Receivables securitization;
(h) Liens pursuant to the Security Documents;
(i) Liens on Collateral securing the Bond Issuance or any other
Indebtedness for borrowed money in respect of debt securities issued in a
public offering or a private placement, which Liens shall be equal and ratable
or subordinate with respect to the Liens on the relevant Collateral securing
the Obligations or the Guarantees thereof, provided, that, (i) the
documentation governing such
40
Liens shall be reasonably satisfactory to the Administrative Agent and (ii)
the Net Cash Proceeds thereof are applied in accordance with Section 2.10(c);
(j) Liens securing Indebtedness or other obligations in an aggregate
principal amount not exceeding $50,000,000 at any time outstanding;
(k) Liens on the new headquarters facility and related property of
the Borrower located near Allentown, Pennsylvania, incurred to facilitate the
financing of this property in an aggregate amount not to exceed $140,000,000,
so long as such financing is a Liquidity Event and the Net Cash Proceeds
therefrom are applied in accordance with Section 2.10(c);
(l) Liens on the principal manufacturing locations and other
property of the Borrower to facilitate the financing of such property, so long
as such financings are Liquidity Events and the Net Cash Proceeds therefrom
are applied in accordance with Section 2.10(c);
(m) Liens securing (i) Indebtedness incurred to finance the
acquisition, construction or improvement of the property of the Borrower (so
long as such security interests and the Indebtedness secured thereby are
incurred prior to or within 90 days after such acquisition or the completion
of such construction or improvement) and (ii) extensions, renewals and
replacements of any such Indebtedness that do not increase the outstanding
principal amount thereof; provided that, in each case, such security interests
shall not apply to any other property or assets of the Borrower or any
Subsidiary; and
(n) Liens securing any Lender Hedging Agreement or any cash
management arrangement (including pay-roll obligations) with a Lender or an
Affiliate of a Lender.
SECTION 6.04 Fundamental Changes. The Borrower will not merge into
or consolidate with any other Person, or permit any other Person (other than a
Subsidiary of the Borrower, so long as (a) the Borrower is the survivor
thereof and (b) no Default or Event of Default shall be in existence after
giving effect thereto) to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) all or substantially all of the assets of the Borrower and its
Subsidiaries, or liquidate or dissolve.
SECTION 6.05 Investments, Loans, Advances, Guarantees and
Acquisitions. The Borrower will not, and will not permit any of its
Subsidiaries to, purchase, hold or acquire any capital stock, evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, Guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any Person (excluding the Borrower), or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any Person (excluding the Borrower) constituting a business unit
(collectively, "Investments"), except:
(a) Investments made prior to the Amendment and Restatement
Effective Date and Investments made pursuant to agreements entered into before
such date (and any extensions, renewals and replacements thereof);
(b) Investments contemplated by the agreements attached to the Form
S-1/A, dated February 7, 2001, as amended, of the Borrower or extensions,
renewals or replacements of such agreements on terms not materially less
favorable to the Borrower and its Subsidiaries;
(c) Guarantee obligations permitted by Section 6.02;
41
(d) loans and advances to employees of the Borrower or any
Subsidiary in the ordinary course of business (including for travel,
entertainment and relocation expenses);
(e) intercompany Investments made in the ordinary course of
business, including, without limitation, Investments that result from
operation of the Borrower's cash management systems operated for itself and
its Subsidiaries;
(f) intercompany Investments by the Borrower or any Subsidiary in
the Borrower or any Person that, at and prior to such investment, is a
Subsidiary Guarantor or, to the extent reasonably necessary to consummate any
proposed Intellectual Property or Receivables securitization, a Securitization
Subsidiary;
(g) (i) Investments by any Foreign Subsidiary in any other Foreign
Subsidiary and (ii) Investments by any Domestic Subsidiary in any other
Domestic Subsidiary;
(h) after the Amendment and Restatement Effective Date, Investments
by the Borrower or any Subsidiary in joint ventures in an aggregate amount not
to exceed, in any fiscal year of the Borrower, the sum of (A) $40,000,000, (B)
up to $10,000,000 unutilized investment capacity from the immediately
preceding fiscal year, and (C) up to $5,000,000 investment capacity from the
immediately succeeding fiscal year; provided, that the baskets set forth above
may be replenished with respect to any fiscal year of the Borrower, up to the
sum of the limits set forth in clauses (A), (B) and (C), by the amount of Net
Cash Proceeds realized from the sale of any joint venture interest (the
Investment in which was permitted under this clause (h)) or distributions or
loan repayments thereon, in each case, in such fiscal year of the Borrower;
(i) after the Amendment and Restatement Effective Date, Investments,
either directly or through a Subsidiary, by the Borrower or any Subsidiary
Guarantor in any other Subsidiary that is not a Subsidiary Guarantor (other
than pursuant to (e) or (f) above or (l) below) in an aggregate amount not to
exceed, in any fiscal year of the Borrower, the sum of (A) $125,000,000, (B)
up to $20,000,000 unutilized investment capacity from the immediately
preceding fiscal year, and (C) up to $10,000,000 investment capacity from the
immediately succeeding fiscal year; provided, that the baskets set forth above
may be replenished with respect to any fiscal year of the Borrower, up to the
sum of the limits set forth in clauses (A), (B) and (C), by the amount of Net
Cash Proceeds realized from the sale of any interest in any Subsidiary that is
not a Subsidiary Guarantor (the Investment in which was permitted under this
clause (i)) or distributions or loan repayments therefrom, in each case, in
such fiscal year of the Borrower;
(j) after the Amendment and Restatement Effective Date, in addition
to other Investments expressly permitted by this Section, Investments by the
Borrower or any of its Subsidiaries in any Person in an aggregate amount
(valued at cost) not to exceed $105,000,000 cash purchase price paid during
the term of this Agreement; provided, that the basket set forth above may be
replenished, up to the original limit of $105,000,000, by the amount of any
Net Cash Proceeds realized during such term by sale or other disposition of
such Investments;
(k) Investments by the Borrower or any Subsidiary to the extent such
Investments are acquired by contribution of Intellectual Property (together
with Intellectual Property licensed prior to the Amendment and Restatement
Effective Date for use in joint development) for products not sold as of the
Amendment and Restatement Effective Date;
42
(l) Investments by the Borrower or any Subsidiary Guarantor in a
note payable to the Borrower or a Subsidiary Guarantor issued by a Subsidiary
in exchange for the grant of a license for Intellectual Property;
(m) trade receivables and Investments received in connection with
the compromise and settlement thereof; and
(n) Investments to fund liquidation and similar expenses related to
FiNET Technologies or LD Fiber Optics LLC in an aggregate amount not to exceed
$25,000,000.
This Section 6.05 shall (A) not restrict Investments by the Borrower
or any Subsidiary in cash, cash equivalents, commercial paper, money market
funds or similar investments in the ordinary course of business and in
accordance with the Borrower's current policies, (B) not restrict the
acquisition of assets or equity interests acquired in exchange for the
issuance of Capital Stock of the Borrower and (C) not restrict the receipt of
equity or debt instruments as consideration in connection with the license,
sale or disposition of assets so long as the Net Cash Proceeds realized from
any such non-cash proceeds are applied when received in accordance with
Section 2.10; provided that the aggregate value of Investments so received in
connection with any such license (other than licenses to non-Affiliates), sale
or disposition of assets shall not exceed 25% of the total consideration
received in connection therewith.
SECTION 6.06 Restricted Payments. The Borrower will not declare or
make, or agree to pay or make, directly or indirectly, any Restricted Payment
to any Person, other than (a) dividends payable solely in additional shares of
Capital Stock of the Borrower and (b) dividends made pursuant to a
shareholders' rights plan of the Borrower.
SECTION 6.07 Transactions with Affiliates. The Borrower will not,
and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire
any property or assets from, or otherwise engage in any other transactions
with, any of its Affiliates, except (a) in the ordinary course of business at
prices and on terms and conditions not less favorable to the Borrower or such
Subsidiary than could be obtained on an arm's-length basis from unrelated
third parties, (b) transactions between or among the Borrower and its
Subsidiaries not involving any other Affiliate, (c) any Restricted Payment
permitted by Section 6.06 and (d) any transactions contemplated by the
agreements attached to the Form S-1/A, dated February 7, 2001, of the Borrower
or extensions, renewals or replacements of such agreements on terms not
materially less favorable to the Borrower and its Subsidiaries.
SECTION 6.08 Limitations on Sale and Leaseback Transactions and CMO
Transactions. The Borrower will not, and will not permit any Subsidiary to,
enter into any Sale and Leaseback Transaction or CMO Transaction unless the
sum of (a) the Attributable Debt or Indebtedness to be outstanding pursuant to
such Sale and Leaseback Transaction or CMO Transaction and (b) all
Attributable Debt or Indebtedness then outstanding pursuant to all other Sale
and Leaseback Transactions or CMO Transactions entered into by the Borrower or
any Subsidiary (after the Original Closing Date) would not exceed $50,000,000;
provided, that, to the extent the Total Exposure is reduced within 3 Business
Days of receipt of such Net Cash Proceeds by the amount of the Net Cash
Proceeds of any such transactions, the Attributable Debt or Indebtedness
pursuant thereto shall not constitute utilization of such $50,000,000 basket.
SECTION 6.09 Intercompany Transfers of Intellectual Property. (a)
Except with respect to patents and patent applications owned by a Person in
which an Investment has been or is being made under Section 6.05(k) or as
permitted by Section 6.05(k), the Borrower will not permit
43
(i) ownership of any patent of the Borrower or any of its Domestic
Subsidiaries to be transferred to any Subsidiary other than Agere Systems
Guardian Corp., except in connection with a disposition constituting a
Liquidity Event;
(ii) the Borrower or any Subsidiary to file any patent application
outside the United States after the Amendment and Restatement Effective
Date, in the name of any Person other than the Borrower or Agere Systems
Guardian Corp.;
(iii) the Borrower or any of its Subsidiaries to enter into any
agreement which would invalidate the security interest of the
Administrative Agent for the benefit of the Lenders in patents created
pursuant to the Security Documents; and
(iv) any Foreign Subsidiary which owns a patent material to the
business of the Borrower not to license or sub-license such patent to the
Borrower.
(b) Except with respect to patents and patent applications owned by
a Person in which an Investment has been or is being made under Section
6.05(k) or as permitted by Section 6.05(k), not later than the time of filing
of a patent application related thereto, the Borrower will cause its U.S.
employees to assign to the Borrower or Agere Systems Guardian Corp. all patent
rights in any invention made by such employees (other than employees subject
to collective bargaining agreements) in the course of their employment with
the Borrower or its Subsidiaries.
SECTION 6.10 Maintenance of Cash, Cash Equivalents and Financial
Asset Management Arrangements. The Borrower will not, and will not permit its
Subsidiaries, to:
(a) maintain cash or cash equivalents under cash management
arrangements, other than cash and cash equivalents maintained under
arrangements (i) with Lenders, (ii) with non-Lenders in an aggregate amount
not to exceed $70,000,000 and (iii) with non-Lenders providing types of
services or services at locations not provided by the Lenders as reasonably
determined by the Administrative Agent so long as, in the case of clauses (ii)
and (iii), as soon as practicable, but no later than 30 days after the
Amendment and Restatement Effective Date, and to the extent permitted by
applicable Requirement of Law, the Borrower shall deliver to the
Administrative Agent a control agreement with respect to any deposit of cash
or cash equivalents with any domestic lock-box bank or any other deposit of
cash or cash equivalents (which in the case of such other deposits of cash and
cash equivalents are in excess of $20,000,000 (during any period of five
consecutive Business Days)) with any domestic bank, which control agreement
shall be reasonably satisfactory in form and substance to the Administrative
Agent and executed by the Borrower, such domestic lockbox bank or other
domestic bank, as the case may be, and the Administrative Agent; or
(b) maintain other cash equivalents or Financial Assets in excess of
$20,000,000 (during any period of five consecutive Business Days) under
management arrangements, other than with Lenders or other financial
institutions; unless, in each case, as soon as practicable, but no later than
30 days after the Amendment and Restatement Effective Date, and to the extent
permitted by law and regulation, the Borrower shall deliver to the
Administrative Agent a control agreement, which control agreement shall be
reasonably satisfactory in form and substance to the Administrative Agent and
executed by the Borrower, such Lender or other financial institution, as the
case may be, and the Administrative Agent;
provided, that, notwithstanding the foregoing, if any satisfactory control
agreement contemplated by paragraph (a) or (b) is not executed and delivered
within 30 days after the Amendment and Restatement Effective Date, the
Borrower then shall have 90 days to replace the Lender, relevant bank or
financial
44
institution with a Lender or any other bank or financial institution
which (to the extent permitted by applicable Requirement of Law and to the
extent required by paragraphs (a) and (b)) has executed and delivered a
control agreement which is reasonably satisfactory in form and substance to
the Administrative Agent and executed by the Borrower, such Lender, other bank
or other financial institution, as the case may be, and the Administrative
Agent; provided, further, this Section 6.10 shall not apply to the Borrower's
pension or other employee benefit funds, trusts or 401(k) programs or any
Accounts maintained by any Securitization Subsidiary.
SECTION 6.11 Certain Agreements with Respect to Indebtedness. The
Borrower will not:
(a) incur after the Amendment and Restatement Effective Date any
Indebtedness which is pari passu (disregarding for the purpose of such
determination the existence of collateral) with the Indebtedness under the
Loan Documents other than (i) any Indebtedness incurred in connection with a
Lien permitted under Section 6.03, (ii) unsecured Indebtedness not to exceed
in the aggregate $50,000,000 outstanding at any time and (iii) subject to
clause (b) and (c) of this Section 6.11, any other Indebtedness constituting a
Liquidity Event or with respect to which the Borrower agrees to apply the Net
Cash Proceeds in accordance with Section 2.10(c).
(b) enter into any credit agreement as a borrower or a guarantor of
monetary obligations (including any bilateral agreement), unless (i) the terms
and conditions of such agreement are reasonably satisfactory to the
Administrative Agent, (ii) the terms of such agreement are no more restrictive
than the terms of this Agreement, (iii) no portion in excess of $50,000,000
(when aggregated with all other amounts permitted to amortize pursuant to this
clause (iii) and Section 6.11(c)(ii)) of such Indebtedness shall amortize on
or prior to September 30, 2005 (it being understood that this clause (iii)
does not apply (A) to bridge loans which are entered into in anticipation of a
Capital Markets Event (which such bridge loan shall be consummated in
connection with a proposed facility which will have no amortization prior to
September 30, 2005 and for which a commitment letter (or similar document
including a full commitment) has been executed) or divestiture, which such
bridge loan in each case allows for an automatic extension of maturity to a
date not earlier than September 30, 2005 if such Capital Markets Event or
divestiture does not occur or (B) to mortgages on the new headquarters
facility or related property or other manufacturing facilities) and (iv) the
commitments in respect thereof immediately shall reduce the Total Exposure on
a dollar-for-dollar basis in accordance with Section 2.10(c); provided, if the
Borrower shall give written notice to the Administrative Agent that the
Borrower forfeits any and all of its right to extend the Maturity Date
pursuant to Section 2.20, each reference to September 30, 2005 in this
paragraph (b) shall be deemed to be a reference to September 30, 2003.
(c) enter into any agreement (other than any agreement specified in
Section 6.11(b)) for borrowed money in respect of debt securities issued in a
public offering or a private placement as a borrower or guarantor of monetary
obligations, unless (i) the terms of such agreement are no more restrictive
than the terms of this Agreement and (ii) no portion in excess of $50,000,000
(when aggregated with all other amounts permitted to amortize pursuant to this
clause (ii) and Section 6.11(b)(iii)) of such Indebtedness shall amortize on
or prior to September 30, 2005 (provided that (A) if the Borrower shall give
written notice to the Administrative Agent that the Borrower forfeits any and
all of its right to extend the Maturity Date pursuant to Section 2.20, the
reference to September 30, 2005 immediately above shall be deemed to be a
reference to September 30, 2003 and (B) this clause (ii) does not apply to
mortgages on the new headquarters facility or related property or other
manufacturing facilities); provided, that this Section 6.11(c) shall not apply
to any Liquidity Event.
ARTICLE VII
Events of Default
-----------------
In case of the happening of any of the following events (each an
"Event of Default"):
(a) the Borrower shall fail to pay any principal of any Loan when
and as the same shall become due and payable, whether at the due date thereof
or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement, when and as the same shall become
due and payable, and such failure shall continue unremedied for a period of
three Business Days;
(c) any representation or warranty made or deemed made by or on
behalf of any Loan Party in or in connection with any Loan Document or any
amendment or modification hereof or waiver hereunder, or in any report,
certificate, financial statement or other document furnished pursuant to or in
connection with any Loan Document or any amendment or modification hereof or
waiver hereunder, shall prove to have been incorrect in any material respect
when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.05 (with respect to the
Borrower's existence), Section 5.10 or Article VI;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those specified
in clause (a), (b) or (d) of this Article), and such failure shall continue
unremedied for a period of 30 days after notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the
request of the Required Lenders);
(f) the Borrower or any Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, the lapse of time or both) the
holder or holders of any Material Indebtedness or any trustee or agent on its
or their behalf to cause any Material Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity; provided that this clause (g) shall not apply to (i)
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness or (ii) (A) any
notice of wind-down, or any comparable notice, to be given under an
Intellectual Property or Receivables securitization or (B) any wind-down, or
comparable event, with respect to any Intellectual Property or Receivables
securitization;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any Subsidiary or its debts, or of a
substantial part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Subsidiary or for a
46
substantial part of its assets, and, in any such case, such proceeding or
petition shall continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking liquidation, reorganization or
other relief under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (h) of this Article, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of its assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors or (vi)
take any action for the purpose of effecting any of the foregoing;
(j) the Borrower or any Subsidiary shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $100,000,000 shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain undischarged
for a period of 30 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any assets of the Borrower or any Subsidiary
to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in a Material Adverse Effect;
or
(m) (i) any of the Security Documents shall cease, for any reason,
to be in full force and effect, or any Loan Party or any Affiliate of any Loan
Party shall so assert, or any Lien created by any of the Security Documents
shall cease to be enforceable and of the same effect and priority purported to
be created thereby (except (A) as permitted by the applicable Security
Document or Section 9.13 or (B) by reason of the failure of the Administrative
Agent to maintain possession of any instruments delivered to it or to file or
record any documents delivered to it for filing or recording) or (ii) the
guarantee contained in Section 2 of the Guarantee and Collateral Agreement
shall cease, for any reason, to be in full force and effect (except as
permitted by the Guarantee and Collateral Agreement or Section 9.13) or any
Loan Party or any Affiliate of any Loan Party shall so assert; or
(n) a Change in Control shall occur;
then, and in every such event (other than an event described in paragraph (h)
or (i) above with respect to the Borrower), and at any time thereafter during
the continuance of such event, the Administrative Agent, at the request of the
Required Lenders, shall, by notice to the Borrower, take either or both of the
following actions, at the same or different times: (i) terminate forthwith the
Revolving Commitments and (ii) declare the Loans then outstanding to be
forthwith due and payable in whole or in part, whereupon the principal of the
Loans so declared to be due and payable, together with accrued interest
thereon and any unpaid accrued Facility Fee and all other liabilities of the
Borrower accrued hereunder, shall become forthwith due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything contained herein to the
contrary notwithstanding, and, in any event with respect to the Borrower
described in paragraph (h) or (i) above, the Revolving Commitments shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Facility Fee and
all other liabilities of the Borrower accrued hereunder, shall automatically
become due and payable, without
47
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything contained herein to the
contrary notwithstanding.
ARTICLE VIII
The Administrative Agent
------------------------
In order to expedite the transactions contemplated by this Agreement
and the other Loan Documents, The Chase Manhattan Bank is hereby appointed to
act as Administrative Agent on behalf of the Lenders. Each of the Lenders
hereby irrevocably authorizes the Administrative Agent to take such actions on
behalf of such Lender and to exercise such powers as are specifically
delegated to the Administrative Agent by the terms and provisions hereof or of
any other Loan Document, together with such actions and powers as are
reasonably incidental thereto. The Administrative Agent is hereby expressly
authorized by the Lenders, without hereby limiting any implied authority, (a)
to receive on behalf of the Lenders all payments of principal of and interest
on the Loans and all other amounts due to the Lenders hereunder, and promptly
to distribute to each Lender its proper share of each payment so received; (b)
to give notice on behalf of each of the Lenders to the Borrower of any Event
of Default specified in this Agreement of which the Administrative Agent has
actual knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and
other materials delivered by the Borrower pursuant to this Agreement as
received by the Administrative Agent.
Neither the Administrative Agent nor any of its directors, officers,
employees or agents shall be liable as such for any action taken or omitted by
any of them except for its or his own gross negligence or willful misconduct,
or be responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by
the Borrower of any of the terms, conditions, covenants or agreements
contained in this Agreement or any other Loan Document. The Administrative
Agent shall not be responsible to the Lenders for the due execution,
genuineness, validity, enforceability or effectiveness of this Agreement, any
other Loan Document or other instruments or agreements. The Administrative
Agent may deem and treat the Lender which makes any Loan as the holder of the
indebtedness resulting therefrom for all purposes hereof until it shall have
received notice from such Lender, given as provided herein, of the transfer
thereof. The Administrative Agent shall in all cases be fully protected in
acting, or refraining from acting, in accordance with written instructions
signed by the Required Lenders and, except as otherwise specifically provided
herein, such instructions and any action or inaction pursuant thereto shall be
binding on all the Lenders. The Administrative Agent shall, in the absence of
knowledge to the contrary, be entitled to rely on any instrument or document
believed by it in good faith to be genuine and correct and to have been signed
or sent by the proper person or persons. Neither the Administrative Agent nor
any of its directors, officers, employees or agents shall have any
responsibility to the Borrower on account of the failure of or delay in
performance or breach by any Lender of any of its obligations hereunder or to
any Lender on account of the failure of or delay in performance or breach by
any other Lender or the Borrower of any of their respective obligations
hereunder or in connection herewith. The Administrative Agent may execute any
and all duties hereunder by or through agents or employees and shall be
entitled to rely upon the advice of legal counsel selected by it with respect
to all matters arising hereunder or under any other Loan Document and shall
not be liable for any action taken or suffered in good faith by it in
accordance with the advice of such counsel.
The Lenders hereby acknowledge that the Administrative Agent shall
be under no duty to take any discretionary action permitted to be taken by it
pursuant to the provisions of this Agreement or any other Loan Document unless
it shall be requested in writing to do so by the Required Lenders.
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Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, the Administrative Agent may resign at
any time by notifying the Lenders and the Borrower. Upon any such resignation,
the Required Lenders shall have the right to appoint a successor
Administrative Agent acceptable to the Borrower. If no successor shall have
been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives
notice of its resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent which shall be
a bank with an office in New York, New York, having a combined capital and
surplus of at least $500,000,000 or an Affiliate of any such bank. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
bank, such successor shall succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Administrative Agent and the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After the Administrative Agent's resignation hereunder,
the provisions of this Article and Section 8.05 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as Administrative Agent.
With respect to the Loans made by it hereunder, the Administrative
Agent in its individual capacity and not as Agent shall have the same rights
and powers as any other Lender and may exercise the same as though it were not
the Administrative Agent, and the Administrative Agent and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of
business with the Borrower or any Subsidiary or other Affiliate thereof as if
it were not the Administrative Agent.
Each Lender agrees (i) to reimburse the Administrative Agent, on
demand, in the amount of its pro rata share (based on its Commitment
hereunder, or, after the Maturity Date, its Loans hereunder) of any expenses
incurred for the benefit of the Lenders by the Administrative Agent, including
counsel fees and compensation of agents and employees paid for services
rendered on behalf of the Lenders, which shall not have been reimbursed by the
Borrower, and (ii) to indemnify and hold harmless the Administrative Agent and
any of its directors, officers, employees or agents, on demand, in the amount
of such pro rata share, from and against any and all liabilities, taxes,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against it in its capacity as the
Administrative Agent or any of them in any way relating to or arising out of
this Agreement, any other Loan Document or any action taken or omitted by it
or any of them under this Agreement or any other Loan Document to the extent
the same shall not have been reimbursed by the Borrower; provided that no
Lender shall be liable to the Administrative Agent for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the gross negligence or
willful misconduct of the Administrative Agent or any of its directors,
officers, employees or agents.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder.
The Syndication Agent shall have no duties or responsibilities
hereunder in its capacity as such.
49
ARTICLE IX
Miscellaneous
-------------
SECTION 9.01 Notices. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed or sent by telecopy, as follows:
(a) if to the Borrower, to it at Agere Systems Inc., 000 Xxxxx
Xxxxxxxxx, Xxxxxxxxx, Xxxxxxxxxxxx 00000, Attention of General Counsel and
Attention of Treasurer (Facsimile No. 610-712-4630);
(b) if to the Administrative Agent, to it at One Chase Xxxxxxxxx
Xxxxx, Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxx Xxxxxx
(Facsimile No. 212-552-5700); and
(c) if to a Lender, to it at its address (or telecopy number) set
forth in an Administrative Questionnaire delivered to the Administrative
Agent.
All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt if delivered by hand or overnight courier service
or sent by telecopy, or on the date five Business Days after dispatch by
certified or registered mail if mailed, in each case delivered, sent or mailed
(properly addressed) to such party as provided in this Section 9.01 or in
accordance with the latest unrevoked direction from such party given in
accordance with this Section 9.01.
SECTION 9.02 Survival of Agreement. All covenants, agreements,
representations and warranties made by any Loan Party in any Loan Document and
in the certificates or other instruments prepared or delivered in connection
with or pursuant to this Agreement shall be considered to have been relied
upon by the Lenders and shall survive the making by the Lenders of the Loans
regardless of any investigation made by the Lenders or on their behalf, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any Fee or any other amount payable under this
Agreement is outstanding and unpaid and so long as the Revolving Commitments
have not been terminated.
SECTION 9.03 Binding Effect. This Agreement shall become effective
when the conditions precedent set forth in Section 4.02 shall have been
satisfied, and thereafter shall be binding upon and inure to the benefit of
the Borrower, the Administrative Agent and each Lender and their respective
successors and assigns.
SECTION 9.04 Successors and Assigns. (a) Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party, and all covenants, promises
and agreements by or on behalf of the Borrower, the Administrative Agent or
the Lenders that are contained in this Agreement shall bind and inure to the
benefit of their respective successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion
of its interests, rights and obligations under this Agreement (including all
or a portion of its Commitment and the Loans at the time owing to it);
provided, however, that (i) except in the case of assignments to a Lender or
an affiliate of a Lender, the Administrative Agent and the Borrower (except
after the occurrence and during the continuance of an Event of Default) must
give their prior written consent to such assignment (such consent not to be
unreasonably withheld or delayed), (ii) the amount of the Revolving Commitment
(or, after the Maturity Date, the Loans) of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Administrative Agent)
shall not be less than $5,000,000 (or the remaining balance of its Revolving
Commitment or Revolving Loans, as applicable) and the amount of the Revolving
Commitment (or,
50
after the Maturity Date, the Revolving Loans) of such Lender remaining after
such assignment shall not be less than $5,000,000 or shall be zero, in each
case unless otherwise agreed by the Borrower and the Administrative Agent,
(iii) in the case of assignments of Term Loans, the amount of the Term Loan of
the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $1,000,000 (or
the remaining balance of its Term Loan) and the amount of the Term Loan of
such Lender remaining after such assignment shall not be less than $1,000,000
or shall be zero, in each case unless otherwise agreed by the Borrower and the
Administrative Agent, (iv) the parties to each such assignment shall execute
and deliver to the Administrative Agent an Assignment and Acceptance, and a
processing and recordation fee of $3,500 and (v) the assignee, if it shall not
be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire. Upon acceptance and recording pursuant to paragraph (e) of this
Section 9.04, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five Business Days
after the execution thereof, (A) the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement,
(B) the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement, except with respect to the confidentiality of
Information pursuant to Section 9.14 (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto (but shall continue to be entitled to the benefits of Sections
2.12, 2.14, 2.18 and 9.05, as well as to the Facility Fee accrued for its
account hereunder and not yet paid)) and (C) Schedule 1.01A shall be deemed
amended to give effect to such assignment.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner
of the interest being assigned thereby free and clear of any adverse claim;
(ii) except as set forth in (i) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto or the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under this
Agreement or any other instrument or document furnished pursuant hereto; (iii)
such assignee represents and warrants that it is legally authorized to enter
into such Assignment and Acceptance; (iv) such assignee confirms that it has
received a copy of this Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.02 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (v) such
assignee will independently and without reliance upon the Administrative
Agent, such assigning Lender or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement; (vi)
such assignee appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Administrative Agent by the terms hereof, together
with such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the obligations
which by the terms of this Agreement are required to be performed by it as a
Lender.
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(d) The Administrative Agent shall maintain at one of its offices in
the City of New York a copy of each Assignment and Acceptance delivered to it
and a register for the recordation of the names and addresses of the Lenders,
and the Revolving Commitment of, and the principal amount of the Loans owing
to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive in the absence of
manifest error and the Borrower, the Administrative Agent and the Lenders may
treat each person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee together with an
Administrative Questionnaire completed in respect of the assignee (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) above and, if required, the written consent
of the Borrower to such assignment, the Administrative Agent shall (i) accept
such Assignment and Acceptance and (ii) record the information contained
therein in the Register.
(f) Each Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other
entities in all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to
it); provided, however, that (i) such Lender's obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, (iii) each participating bank or other entity shall be entitled
to the benefit of the cost protection provisions contained in Sections 2.12,
2.14 and 2.18 to the same extent as if it was the selling Lender, except that
all claims and petitions for payment and payments made pursuant to such
Sections shall be made through such selling Lender, and (iv) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such selling Lender in connection with such Lender's rights and
obligations under this Agreement, and such Lender shall retain the sole right
(and participating banks or other entities shall have no right) to enforce the
obligations of the Borrower relating to the Loans and to approve any
amendment, modification or waiver of any provision of this Agreement or any
other Loan Document (other than amendments, modifications or waivers
decreasing any fees payable hereunder or the amount of principal of or the
rate at which interest is payable on the Loans, or extending any scheduled
principal payment date or date fixed for the payment of interest on the
Loans).
(g) Any Lender or participant may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Section 9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower; provided that, prior to any such disclosure,
each such assignee or participant or proposed assignee or participant shall
execute an agreement whereby such assignee or participant shall agree (subject
to customary exceptions) to preserve the confidentiality of any such
confidential information relating to the Borrower.
(h) The Borrower shall not assign or delegate any of its respective
rights and duties hereunder without the prior written consent of all Lenders
and any attempted assignment without such consent shall be void.
(i) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this Section 9.04 concerning assignments
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including any pledge or assignment by
a Lender to any Federal Reserve Bank in accordance with applicable law;
provided that no such assignment shall release any Lender from its obligations
hereunder or substitute any such Bank for such Lender as a party hereto. In
order to facilitate such an assignment, the Borrower shall, at the request of
52
the assigning Lender, duly execute and deliver to the assigning Lender a
promissory note or notes evidencing the Loans made to the Borrower by the
assigning Lender hereunder.
SECTION 9.05 Expenses; Indemnity. (a) The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Administrative Agent and the
Arrangers in connection with this Agreement or any other Loan Document or in
connection with any amendments, modifications or waivers of the provisions
hereof or thereof, or incurred by the Administrative Agent or any Lender in
connection with the enforcement or protection of their rights in connection
with this Agreement or any other Loan Document or in connection with the Loans
made hereunder, including the fees and disbursements of counsel for the
Administrative Agent or, in the case of enforcement or protection, Lenders.
(b) The Borrower agrees to indemnify the Administrative Agent, the
Arrangers, the Lenders, Affiliates, and their respective directors, officers,
employees and agents (each such person being called an "Indemnitee") against,
and to hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including reasonable counsel fees
and expenses, incurred by or asserted against any Indemnitee arising out of
(i) the execution or delivery of this Agreement, any other Loan Document or
any agreement or instrument contemplated thereby, the performance by the
parties thereto of their respective obligations thereunder or the consummation
of the transactions contemplated thereby, (ii) the use of the proceeds of the
Loans or (iii) any claim, litigation, investigation or proceeding relating to
any of the foregoing, whether or not any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
resulted from the gross negligence or willful misconduct of such Indemnitee.
(c) The provisions of this Section 9.05 shall remain operative and
in full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term
or provision of this Agreement or any investigation made by or on behalf of
the Administrative Agent or any Lender. All amounts due under this Section
9.05 shall be payable on written demand therefor.
SECTION 9.06 Applicable Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.07 Waivers; Amendment. (a) No failure or delay of the
Administrative Agent or any Lender in exercising any power or right hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any, such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies which they would otherwise have. No waiver
of any provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted
by paragraph (b) below, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. No notice
or demand on the Borrower in any case shall entitle the Borrower to any other
or further notice or demand in similar or other circumstances.
(b) Neither this Agreement, any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Borrower and the
Required Lenders; provided, however, that no such agreement shall (i) decrease
the principal amount of, or extend the maturity of or any scheduled principal
payment date or date for the payment of any interest on any Loan, or waive or
excuse any such payment or any part thereof or decrease the rate of interest
on any Loan, without the prior written consent of each Lender
53
directly affected thereby, (ii) increase the Revolving Commitment or decrease
the Facility Fee of any Lender without the prior written consent of such
Lender, or (iii) amend or modify the provisions of Section 2.15 or Section
9.04(h), the provisions of this Section or the definition of "Required
Lenders", or release all or substantially all of the Collateral or the
Guarantees of the Subsidiary Guarantors pursuant to the Guarantee and
Collateral Agreement (except as provided therein or in Section 9.13), without
the prior written consent of each Lender, provided, further, however, that no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Administrative Agent hereunder without the prior written consent of the
Administrative Agent. Each Lender shall be bound by any waiver, amendment or
modification authorized by this Section and any consent by any Lender pursuant
to this Section shall bind any assignee of its rights and interests hereunder.
SECTION 9.08 Entire Agreement. This Agreement constitutes the entire
contract among the parties relative to the subject matter hereof. Any previous
agreement among the parties with respect to the subject matter hereof is
superseded by this Agreement. Nothing in this Agreement expressed or implied,
is intended to confer upon any party other than the parties hereto any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
SECTION 9.09 Severability. In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby. The parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the
invalid, illegal or unenforceable provisions.
SECTION 9.10 Right of Setoff. If an Event of Default shall have
occurred and be continuing under clause (a) or (b) of Article VII, or if the
Loans shall become due and payable pursuant to Article VII, each Lender and
each of its Affiliates is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any
time held and other obligations at any time owing by such Lender or Affiliate
to or for the credit or the account of any Loan Party against any of and all
the obligations of any Loan Party now or hereafter existing under this
Agreement or any other Loan Document held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement or
any other Loan Document and although such obligations may be unmatured. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 9.11 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one contract, and shall become
effective as provided in Section 9.03.
SECTION 9.12 Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 9.13 Release of Guarantees and Liens. (a) Notwithstanding
anything to the contrary contained herein or in any other Loan Document, the
Administrative Agent is hereby irrevocably authorized by each Lender (without
requirement of notice to or consent of any Lender) to take any action
requested by the Borrower (it being understood that the Administrative Agent
shall not unreasonably refuse to take any such action) having the effect of
releasing any Collateral or Guarantee obligations (i) to the extent necessary
to permit consummation of any transaction, including any CMO Transaction and
any mortgages or Sale and Leaseback Transactions on the Borrower's new
headquarters facility or principal
54
manufacturing facilities permitted by this Agreement, not prohibited by any
Loan Document or that has been consented to in accordance with Section 9.07 or
(ii) under the circumstances described in paragraph (b).
(b) Upon the consummation of the Bond Issuance (notwithstanding any
other provision set forth in this Agreement, including, with the consent of
the Required Lenders and each Initial Lender, an issuance by the Borrower of
debt securities in an aggregate amount of less than $500,000,000 that would
otherwise meet the definition of "Bond Issuance", provided that at least
$250,000,000 of the Net Cash Proceeds of such issuance shall have been applied
in accordance with Article II) and the application of the Net Cash Proceeds
thereof in accordance with Section 2.10(c), and so long as on the date of the
Bond Issuance and on the date of the application of such Net Cash Proceeds, no
Default or Event of Default has occurred and is continuing, (i) the Guarantees
created by the Guarantee and Collateral Agreement shall be terminated (other
than the Guarantee made by Agere Systems Guardian Corp.) and the Collateral of
each Subsidiary Guarantor (other than the Collateral of Agere Systems Guardian
Corp.) shall automatically be released from the Liens created by the Security
Documents and (ii) the Borrower and its Subsidiaries shall not be required to
comply with the provisions of Section 5.11.
SECTION 9.14 Confidentiality. Each of the Administrative Agent and
the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process,
(d) to any other party to this Agreement, (e) in connection with the exercise
of any remedies hereunder or any suit, action or proceeding relating to this
Agreement or the enforcement of rights hereunder, (f) subject to an express
agreement containing provisions substantially the same as those of this
Section, to any assignee of or participant in, or any prospective assignee of
or participant in, any of its rights or obligations under this Agreement, (g)
with the consent of the Borrower or (h) to the extent such Information (i)
becomes publicly available other than as a result of a breach of this Section
or (ii) becomes available to the Administrative Agent or any Lender on a
nonconfidential basis from a source other than the Borrower. For the purposes
of this Section, "Information" means all information received from the
Borrower relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; provided that, in
the case of information received from the Borrower after the Original Closing
Date, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
SECTION 9.15 Submission to Jurisdiction. The Borrower hereby
irrevocably and unconditionally:
(a) 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, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;
(b) 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 action or proceeding in
55
any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(c) 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 Borrower at
its address referred to in Section 9.01 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) 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
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.
SECTION 9.16 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
SECTION 9.17 Authorization of Administrative Agent. It is expressly
agreed that the Borrower and its Subsidiaries have the right, on the terms and
subject to the conditions set forth herein, to complete Receivables
securitizations, Intellectual Property securitizations and mortgages or Sale
and Leaseback Transactions on its new headquarters facility or principal
manufacturing facilities, in each case, the Net Cash Proceeds of which would
be subject to Section 2.10(c). The Lenders hereby authorize and instruct the
Administrative Agent to execute and deliver such documents and instruments as
it may reasonably deem appropriate to facilitate any Intellectual Property or
Receivables securitization or mortgages or Sale and Leaseback Transactions on
its new headquarters facility or principal manufacturing facilities permitted
by this Agreement, including any UCC releases and any required intercreditor
agreements (the terms of which may include a subordination of the
Administrative Agent's security interest or mortgages, as applicable, in
certain Receivables, Intellectual Property or real property to facilitate any
such transaction.
SECTION 9.18 Amendment of Guarantee and Collateral Agreement. Each
party hereto, by its execution and delivery of this Agreement, hereby consents
to the amendments to the Guarantee and Collateral Agreement provided for in
the Consent and Confirmation referred to in Section 4.02(f).
[Remainder of page left blank intentionally; Signature pages to follow.]
IN WITNESS WHEREOF, the Borrower, the Administrative Agent, the
Syndication Agent and the Lenders have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
AGERE SYSTEMS INC., as the Borrower
By: __________________________________________
Title:
THE CHASE MANHATTAN BANK, individually
and as Administrative Agent
By: __________________________________________
Title:
XXXXXXX XXXXX XXXXXX INC., as Syndication
Agent
By: __________________________________________
Title:
CITICORP USA, INC., as a Lender
By: __________________________________________
Title: