UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2002
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number: 1-5571
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RADIOSHACK CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 75-1047710
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 Throckmorton Street, Suite 1800, Fort Worth, Texas 76102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 415-3700
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Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No __
The number of shares outstanding of the issuer's Common Stock, $1 par value, on
July 31, 2002 was 171,536,880.
Index to Exhibits is on Sequential Page No. 14. Total pages 139.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
RADIOSHACK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- ---------------------
(In millions, except per share amounts) 2002 2001 2002 2001
--------------------------------------- --------- --------- --------- ---------
Net sales and operating revenues $ 998.1 $ 1,039.5 $ 2,032.5 $ 2,179.0
Cost of products sold 488.0 527.1 1,002.7 1,120.1
--------- --------- --------- ---------
Gross profit 510.1 512.4 1,029.8 1,058.9
--------- --------- --------- ---------
Operating expenses:
Selling, general and administrative 421.3 398.0 814.5 803.2
Depreciation and amortization 24.3 27.5 48.9 55.2
Loss on sale of assets -- 12.4 -- 12.4
--------- --------- --------- ---------
Total operating expenses 445.6 437.9 863.4 870.8
--------- --------- --------- ---------
Operating income 64.5 74.5 166.4 188.1
Interest income 2.1 4.2 3.9 8.6
Interest expense (10.7) (12.2) (21.5) (25.2)
Other income 27.7 -- 27.7 --
Provision for loss on Internet-related investment -- -- -- (30.0)
--------- --------- --------- ---------
Income before income taxes 83.6 66.5 176.5 141.5
Provision for income taxes 31.8 25.3 67.1 53.8
--------- --------- --------- ---------
Net income 51.8 41.2 109.4 87.7
Preferred dividends 1.1 1.2 2.3 2.5
--------- --------- --------- ---------
Net income available to common stockholders $ 50.7 $ 40.0 $ 107.1 $ 85.2
========= ========= ========= =========
Net income available per common share:
Basic $ 0.29 $ 0.22 $ 0.61 $ 0.46
========= ========= ========= =========
Diluted $ 0.28 $ 0.21 $ 0.59 $ 0.44
========= ========= ========= =========
Shares used in computing earnings per common share:
Basic 174.4 185.9 175.6 186.3
========= ========= ========= =========
Diluted 181.5 193.1 182.5 194.3
========= ========= ========= =========
The accompanying notes are an integral part of these consolidated financial statements.
RADIOSHACK CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
June 30, December 31, June 30,
2002 2001 2001
(In millions, except for share amounts) (Unaudited) (Unaudited)
-------------------------------------- ----------- ----------- -----------
Assets
Current assets:
Cash and cash equivalents $ 529.1 $ 401.4 $ 336.1
Accounts and notes receivable, net 151.8 276.3 294.6
Inventories, at lower of cost or market 830.6 949.8 974.1
Other current assets 86.6 86.8 68.6
----------- ----------- -----------
Total current assets 1,598.1 1,714.3 1,673.4
Property, plant and equipment, net 398.0 417.7 461.3
Other assets, net of accumulated amortization 115.4 113.1 146.5
----------- ----------- -----------
Total assets $ 2,111.5 $ 2,245.1 $ 2,281.2
=========== =========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Short-term debt, including current maturities of
long-term debt $ 71.3 $ 105.5 $ 68.9
Accounts payable 225.7 206.7 183.5
Accrued expenses 279.6 336.1 252.9
Income taxes payable 126.8 178.1 116.9
----------- ----------- -----------
Total current liabilities 703.4 826.4 622.2
Long-term debt, excluding current maturities 582.3 565.4 595.5
Other non-current liabilities 71.4 75.2 68.0
----------- ----------- -----------
Total liabilities 1,357.1 1,467.0 1,285.7
----------- ----------- -----------
Minority interest in consolidated subsidiary -- -- 100.0
Commitments and contingent liabilities
Stockholders' equity:
Preferred stock, no par value, 1,000,000 shares authorized
Series A junior participating, 300,000 shares designated
and none issued -- -- --
Series B convertible (TESOP), 100,000 shares authorized;
61,500, 64,500 and 67,100 shares issued, respectively 61.5 64.5 67.1
Common stock, $1 par value, 650,000,000 shares authorized;
236,033,000 shares issued 236.0 236.0 236.0
Additional paid-in capital 140.4 138.8 129.7
Retained earnings 1,889.8 1,787.3 1,723.2
Treasury stock, at cost; 63,337,000, 59,233,000 and
52,090,000 shares, respectively (1,570.9) (1,443.5) (1,252.4)
Unearned deferred compensation (1.9) (4.3) (7.5)
Accumulated other comprehensive loss (0.5) (0.7) (0.6)
----------- ----------- -----------
Total stockholders' equity 754.4 778.1 895.5
----------- ----------- -----------
Total liabilities and stockholders' equity $ 2,111.5 $ 2,245.1 $ 2,281.2
=========== =========== ===========
The accompanying notes are an integral part of these consolidated financial statements.
RADIOSHACK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
Six Months Ended
June 30,
(In millions) 2002 2001
------------ -------- ---------
Cash flows from operating activities:
Net income $ 109.4 $ 87.7
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for loss on Internet-related investment -- 30.0
Loss on sale of assets -- 12.4
Depreciation and amortization 48.9 55.2
Provision for credit losses and bad debts 2.3 9.1
Other items 4.2 9.0
Changes in operating assets and liabilities:
Receivables 123.9 152.7
Inventories 119.2 190.2
Other current assets 0.8 (11.4)
Accounts payable, accrued expenses and income taxes payable (93.3) (196.0)
-------- ---------
Net cash provided by operating activities 315.4 338.9
-------- ---------
Cash flows from investing activities:
Additions to property, plant and equipment (34.0) (62.1)
Proceeds from sale of property, plant and equipment 4.1 3.1
Proceeds from early retirement of CompUSA note -- 123.6
Other investing activities (0.8) (4.2)
-------- ---------
Net cash (used in) provided by investing activities (30.7) 60.4
-------- ---------
Cash flows from financing activities:
Purchases of treasury stock (163.4) (87.6)
Proceeds from sale of common stock put options -- 0.3
Sales of treasury stock to employee stock plans 22.7 28.6
Proceeds from exercise of stock options 7.5 4.4
Dividends paid (1.5) (22.1)
Changes in short-term borrowings, net -- (461.3)
Increase in long-term borrowings 32.1 346.4
Repayments of long-term borrowings (54.4) (2.6)
-------- ---------
Net cash used in financing activities (157.0) (193.9)
-------- ---------
Net increase in cash and cash equivalents 127.7 205.4
Cash and cash equivalents, beginning of period 401.4 130.7
-------- ---------
Cash and cash equivalents, end of period $ 529.1 $ 336.1
======== =========
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 - BASIS OF FINANCIAL STATEMENTS
We prepared the accompanying unaudited consolidated financial statements in
accordance with the rules of the Securities and Exchange Commission and we did
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In management's
opinion, all adjustments (consisting only of normal recurring accruals)
considered necessary for a fair presentation are included. However, operating
results for the six months ended June 30, 2002 do not necessarily indicate the
results you might expect for the year ending December 31, 2002. If you desire
further information, you should refer to our consolidated financial statements
and management's discussion and analysis of financial condition and results of
operations included in our 2001 Annual Report on Form 10-K for the year ended
December 31, 2001.
NOTE 2 - BASIC AND DILUTED EARNINGS PER SHARE
The following schedule is a reconciliation of the numerators and denominators
used in computing our basic and diluted earnings per share ("EPS") calculations
for the three and six months ended June 30, 2002 and 2001, respectively. Basic
EPS excludes the effect of potentially dilutive securities, while diluted EPS
reflects the potential dilution that would have occurred if our securities or
other contracts to issue common stock were exercised, converted, or resulted in
the issuance of our common stock that would have then shared in our earnings.
Three Months Ended Three Months Ended
June 30, 2002 June 30, 2001
------------------------------------- -------------------------------------
Income Shares Per Share Income Shares Per Share
(In millions, except per share amounts) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
------------------------------------- ----------- ----------- ----------- ----------- ----------- -----------
Net income $ 51.8 $ 41.2
Less: Preferred stock dividends (1.1) (1.2)
----------- -----------
Basic EPS
Net income available to common
shareholders 50.7 174.4 $ 0.29 40.0 185.9 $ 0.22
=========== ===========
Effect of dilutive securities:
Dividends on Series B preferred stock 1.1 1.2
Additional contribution required for TESOP
if preferred stock had been converted (1.1) 5.4 (0.8) 5.8
Stock options 1.7 1.4
----------- ----------- ------------ -----------
Diluted EPS
Net income available to common
shareholders plus assumed conversions $ 50.7 181.5 $ 0.28 $ 40.4 193.1 $ 0.21
=========== =========== =========== =========== =========== ===========
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
------------------------------------- -------------------------------------
Income Shares Per Share Income Shares Per Share
(In millions, except per share amounts) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
------------------------------------- ----------- ----------- ----------- ----------- ----------- -----------
Net income $ 109.4 $ 87.7
Less: Preferred stock dividends (2.3) (2.5)
----------- -----------
Basic EPS
Net income available to common
shareholders 107.1 175.6 $ 0.61 85.2 186.3 $ 0.46
=========== ===========
Effect of dilutive securities:
Dividends on Series B preferred stock 2.3 2.5
Additional contribution required for TESOP
if preferred stock had been converted (2.3) 5.4 (1.7) 5.9
Stock options 1.5 2.1
----------- ----------- ----------- -----------
Diluted EPS
Net income available to common
shareholders plus assumed conversions $ 107.1 182.5 $ 0.59 $ 86.0 194.3 $ 0.44
=========== =========== =========== =========== =========== ===========
Options to purchase 11.9 million shares of common stock for both the three and
six month periods ended June 30, 2002, as compared to options to purchase 13.1
million and 12.8 million shares of common stock for the comparable periods in
the prior year, were not included in the computation of diluted earnings per
common share because the exercise prices of the options were greater than the
average market price of the common stock during the periods and the effect of
their inclusion in the computation would have been antidilutive.
NOTE 3 - REVOLVING CREDIT FACILITY
In the second quarter of 2002, we replaced our existing $600.0 million credit
facilities with new credit facilities, also totaling $600.0 million. A syndicate
of 16 banks granted the new facilities. These facilities are comprised of a
$300.0 million 364-day revolving credit facility maturing in June 2003 and a
$300.0 million five-year revolving credit facility maturing in June 2007. The
terms of these revolving credit facilities are substantially similar to the
previous facilities. The new revolving credit facilities will support any future
commercial paper borrowings and are otherwise available for general corporate
purposes.
NOTE 4 - COMPREHENSIVE INCOME
Comprehensive income for the three months ended June 30, 2002 and 2001 was $52.0
million and $41.8 million, respectively, and comprehensive income for the six
months ended June 30, 2002 and 2001 was $109.6 million and $88.1 million,
respectively.
NOTE 5 - BUSINESS RESTRUCTURING
In 1996 and 1997, we initiated certain restructuring programs in which a number
of our former McDuff, Computer City and Incredible Universe retail stores were
closed. We still have certain real estate obligations related to some of these
stores. At December 31, 2001, the balance in the restructuring reserve was $11.8
million and consisted of the remaining estimated real estate obligations to be
paid. During the three and six months ended June 30, 2002, approximately $0.6
million and $1.6 million, respectively, was charged against the reserve. An
additional $1.2 million relating to real estate obligations was added to the
reserve during the first quarter of 2002, leaving a balance in the reserve of
$11.4 million at June 30, 2002.
NOTE 6 - RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS
The Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment of Long-Lived
Assets" ("SFAS 144"), in October 2001, which establishes accounting and
reporting standards for the impairment and disposition of long-lived assets
(except unidentifiable intangibles), including discontinued operations. SFAS 144
became effective for all financial statements issued for fiscal years beginning
after December 15, 2001 and, generally, its provisions are to be applied
prospectively. We adopted SFAS 144 effective January 1, 2002, and there were no
material adjustments as a result of this adoption.
NOTE 7 - COMMITMENTS AND CONTINGENT LIABILITIES
We have various pending claims, lawsuits, disputes with third parties,
investigations and actions incidental to the operation of our business. Although
occasional adverse settlements or resolutions may occur and negatively impact
earnings in the year of settlement, it is our opinion that their ultimate
resolution will not have a materially adverse effect on our financial condition
or liquidity.
We lease rather than own most of our facilities. Our retail stores comprise the
largest portion of our leased facilities. These stores are located primarily in
major shopping malls and shopping centers owned by other companies. Some leases
are based on a minimum rental plus a percentage of the store's sales in excess
of a stipulated base figure. We also lease distribution centers, office space
and our corporate headquarters.
NOTE 8 - LITIGATION
Subject to court approval, we have reached agreement on a tentative settlement
of $29.9 million in a class action lawsuit originally filed in March 2000 in
Orange County, California. The lawsuit, styled Omar Belazi, et al vs. Tandy
Corporation, et al, related to the alleged miscalculation of overtime wages for
certain of our former and current employees in that state. We denied liability.
Additionally, in the second quarter of 2002, we received payments of $27.7
million in partial settlement of amounts owed to us under a tax sharing
agreement that was the subject of an arbitration styled Tandy Corporation and
T.E. Electronics, Inc. vs. O'Sullivan Industries Holdings, Inc. This partial
settlement followed a ruling in RadioShack's favor by the arbitration panel.
This arbitration was commenced in July 1999 and the settlement also requires
O'Sullivan to make ongoing payments under this tax sharing agreement that
was entered into by the parties at the time of O'Sullivan's initial public
offering.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION ("MD&A")
FACTORS THAT MAY AFFECT FUTURE RESULTS
Matters discussed in MD&A include forward-looking statements within the meaning
of the federal securities laws. This includes statements concerning management's
plans and objectives relating to our operations or economic performance and
related assumptions. Forward-looking statements are made based on management's
expectations and beliefs concerning future events and, therefore, involve a
number of risks and uncertainties. Management cautions that forward-looking
statements are not guarantees and actual results could differ materially from
those expressed or implied in the forward-looking statements. Important factors
that could cause our actual results of operations or financial condition to
differ include, but are not necessarily limited to:
o changes in national or regional U.S. economic conditions, including, but
not limited to, recessionary trends, level of the equity markets, consumer
credit availability, interest rates, inflation, consumers' disposable
income and spending levels, job security and unemployment, and overall
consumer confidence;
o continuing terrorist activities in the U.S., as well as the resulting
international war on terrorism;
o the disruption of international, national or regional transportation
systems;
o changes in the amount and degree of promotional intensity exerted by
current competitors and potential new competition from both retail stores
and alternative methods or channels of distribution, such as e-commerce,
telephone shopping services and mail order;
o the inability to successfully execute our strategic initiatives, including
our Anchor, Participatory and Opportunistic ("APOS") business model and our
strategic business units ("SBU") and emerging sales channels strategies, as
well as new alliances which may be formed with other retailers and third
party service providers;
o the presence or absence of new services or products and product features in
the merchandise categories we sell and unexpected changes in our actual
merchandise sales mix;
o the inability to maintain profitable contracts or execute business plans
with providers of third party branded products and with service providers
relating to cellular and PCS telephones and direct-to-home ("DTH")
satellite programming;
o the inability to collect the level of anticipated residual income, consumer
acquisition fees and rebates for products and third party services offered
by us;
o the inability to successfully maintain our strategic alliances, including
those with Compaq, DIRECTV, DISH Network, Thomson/RCA, Sprint, and/or
Verizon Wireless;
o the lack of availability or access to sources of inventory;
o the inability to successfully implement our Retrofest strategy of
reallocating a portion of our retail stores' display space, which will
permit us to enhance the display of other product lines;
o the inability to establish and implement our internal and external supply
chain initiatives;
o changes in the financial markets that would reduce or eliminate access to
longer term capital or short-term credit availability;
o the inability to attract, retain and grow an effective management team in a
dynamic environment or changes in the cost or availability of a suitable
work force to manage and support our service-driven operating strategies;
o the imposition of new restrictions or regulations regarding the sale of
products and/or services we sell or changes in tax rules and regulations
applicable to us;
o the adoption rate and market demand for new electronic products such as
high-speed Internet or other Internet-related services; or
o the occurrence of severe weather events which prohibit consumers from
travelling to our retail locations, especially during the peak winter
holiday season.
RESULTS OF OPERATIONS
Net Sales and Operating Revenues
Our sales decreased 4.0% to $998.1 million for the quarter ended June 30, 2002,
compared to $1,039.5 million in the corresponding prior year period. For the six
months ended June 30, 2002, our overall sales decreased 6.7% to $2,032.5
million, compared to $2,179.0 million for the same period in 2001. Comparable
store sales were flat for the second quarter, with a decrease of 4% for the
six-month period ended June 30, 2002, respectively, when compared to the prior
year second quarter and six-month periods. Sales from our dealer/franchise
channel decreased 42% or $30.0 million and 38% or $58.8 million, respectively,
for the quarter and six months ended June 30, 2002. Our sales decreases for both
the three and six-month periods were driven primarily by decreased sales of DTH
satellite systems and services as a result of the loss of DIRECTV as a service
provider in National Rural Telecommunications Coalition markets, as well as the
lack of a full complement of DISH Network offerings for most of the 2002 second
quarter. To a lesser extent, these sales decreases were due to lower home
computer and monitor sales. Increased sales of wireless handsets partially
offset our sales decrease. Increased sales of wireless and home entertainment
accessories, batteries and portable computers also helped offset this decrease.
We expect to see comparable store sales improvement for the second half of the
year, compared to 2001.
During 2001, we reorganized our marketing and merchandising departments into
three product groups, which we call Strategic Business Units ("SBU"). These SBUs
relate to our position of "Connecting People," "Connecting Places" and
"Connecting Things" in the consumer electronics marketplace. An explanation of
each unit is provided below. Each SBU is responsible for specific products and
third party relationships. These SBUs work with our brand management, sales
channels and support groups, which together allow RadioShack to target the right
customer through the right sales channel with the appropriate products and
support.
Each SBU is designed to focus on more efficient and convenient ways to serve our
sales channels. In addition to our 5,144 company-owned stores and 2,094
dealer/franchise outlets, our existing and emerging sales channels include the
www.radioshack.com e-commerce site and online catalog operations, as well as an
outbound and inbound telephone call center.
The Connecting People SBU consists of the wireless communication, wired
communication and radio communication departments. The wireless communication
department includes products such as wireless handsets and related accessories,
in addition to prepaid wireless refill services and related residuals. The wired
communication department includes products such as cordless phones and phone
cords, plus prepaid long distance cards. Products including two-way radios and
scanners are part of the radio communication department. Our strategic alliances
for the Connecting People SBU include both Sprint and Verizon Wireless.
The Connecting Places SBU has two departments, home entertainment and computers.
The home entertainment department includes audio and video products and services
such as DTH satellite systems and related residuals, installation services, DVD
players and accessories. The computer department includes personal computers and
accessories, hand-held computers, and Internet devices and services, as well as
digital cameras. This SBU is responsible for our strategic alliances with
Compaq, DIRECTV, DISH Network and Thomson/RCA.
The Connecting Things SBU includes the accessories, batteries and technical
departments, as well as the personal electronics, seasonal and portable audio
departments. Products include AC and DC power adapters, general and special
purpose batteries, wire and connectors, toys and radio control cars, giftables
and personal portable audio products.
Connecting People Strategic Business Unit: Sales in the Connecting People SBU
increased approximately 10% for both the quarter and six months ended June 30,
2002, respectively, when compared to the corresponding prior year periods. Sales
in the wireless communication department, which includes cellular and PCS
handsets, accessories, related residuals and prepaid airtime services, increased
approximately 14% for the quarter, when compared to the second quarter last
year. This sales increase was due primarily to an increase in sales of wireless
handsets and accessories. Sales for the wired communication department, which
includes land-line telephones, answering machines and other related telephony
products, increased slightly for the quarter, when compared to the second
quarter last year. The increase in this department was primarily the result of
increased sales of telephone accessories, cordless phones and answering
machines. Sales for the radio communication department increased slightly for
the quarter, when compared to the second quarter last year. The increase in this
department was primarily the result of increased sales of both two-way and
short-wave radios. The Connecting People SBU expects to maintain a sales
increase for 2002, primarily driven by increases in the wireless communication
department.
Connecting Places Strategic Business Unit: Sales in the Connecting Places SBU
decreased approximately 20% for the quarter and decreased approximately 25% for
the six month period ended June 30, 2002, respectively, when compared to the
corresponding prior year periods. The home entertainment department, which
consists of home audio and video products, including DTH satellites,
installation services and related residuals, decreased approximately 30% for the
quarter, when compared to the second quarter last year. This decrease was
primarily attributable to a decrease in sales of satellite systems and
associated installations and was partially offset by increased sales of DVD
players and home entertainment accessories. The computer department, which
includes computers, related accessories and home networking products, increased
approximately 13% for the quarter, when compared to the second quarter last
year. This increase was primarily attributable to an increase in sales of laptop
computers, as well as an increase in sales of computer accessories, home
networking products and digital cameras. The Connecting Places SBU expects to
continue to experience a sales decrease for 2002, primarily due to a lower
blended average selling price from our two providers of DTH satellite systems.
Connecting Things Strategic Business Unit: Sales in the Connecting Things SBU
increased approximately 3% for the quarter and increased approximately 2% for
the six months ended June 30, 2002, respectively, when compared to the
corresponding prior year periods. Sales for the accessories, batteries and
technical departments increased 7% for the quarter, when compared to the second
quarter last year. This increase was primarily due to increased sales of general
and special purpose batteries. Sales for the personal electronics, seasonal and
portable audio departments decreased 4% for the quarter, when compared to the
second quarter last year, due primarily to decreased sales of music-related
products, portable audio, and toys. These sales decreases were due in part to a
strategic move made to narrow existing inventories for certain products to
prepare for the introduction of new product lines. The Connecting Things SBU
expects to experience a sales increase in 2002, primarily driven by accessories,
batteries and digital audio product sales.
RadioShack Retail Outlets
June 30, March 31, December 31, September 30, June 30,
2002 2002 2001 2001 2001
--------- --------- --------- --------- ---------
Company-owned 5,144 5,125 5,127 5,133 5,105
Cool Things @ Blockbuster --- --- 127 123 96
Dealer/franchise 2,094 2,086 2,119 2,101 2,079
--------- --------- --------- --------- ---------
Total number of retail outlets 7,238 7,211 7,373 7,357 7,280
========= ========= ========= ========= =========
Gross Profit
During the second quarter of 2002, gross profit dollars decreased slightly to
$510.1 million, but gross profit as a percent of net sales and operating
revenues increased 1.8 percentage points to 51.1%, compared to 49.3% for the
corresponding 2001 period. For the six months ended June 30, 2002, gross profit
dollars decreased 2.7% to $1,029.8 million, but gross profit as a percent of net
sales and operating revenues increased 2.1 percentage points to 50.7%, compared
to 48.6% for the corresponding period in 2001. The percentage point increases
for the three and six months ended June 30, 2002, were primarily attributable to
a decline in sales from the home entertainment department, which has a lower
gross profit margin than our overall average gross profit margin. In addition,
an increase in the computer department gross profit margin, which is
significantly lower than our average gross profit margin, combined with a
decrease in computer department sales for the first half of 2002, also
contributed to the 2.1 percentage point increase in our gross profit margin for
the six months ended June 30, 2002. Additionally, an increase in the gross
profit margin associated with sales within the accessories, battery and
technical departments, combined with an increase in sales, had a positive effect
on both gross profit dollars and gross profit margin in the three and six months
ended June 30, 2002. For the three months ended June 30, 2002, the decline in
dealer/franchise sales also had a positive effect on our overall gross profit
margin, since the gross profit margin for our dealer/franchise stores is lower
than our overall average gross profit margin. We anticipate that gross profit as
a percentage of net sales and operating revenues for 2002 will remain above the
2001 annual level, due primarily to the positive effect of sales mix changes.
Selling, General and Administrative Expense
Our SG&A expense increased 5.9% or $23.3 million and 1.4% or $11.3 million for
the quarter and six months ended June 30, 2002, respectively, when compared to
the same periods in the prior year. This represents 3.9 and 3.2 percentage point
increases to 42.2% and 40.1% of net sales and operating revenues for the quarter
and six months ended June 30, 2002, respectively, when compared to the same
periods the prior year. These dollar increases were primarily due to a $29.9
million litigation charge related to the tentative settlement of a class action
lawsuit in the state of California during the second quarter of 2002. Lower
overall sales in the current three and six month periods also contributed to
higher SG&A expense as a percentage of net sales and operating revenues.
Excluding the $29.9 million charge related to the California lawsuit, SG&A
expense decreased 1.7% or $6.6 million and 2.3% or $18.6 million for the quarter
and six months ended June 30, 2002, respectively, when compared to the same
periods in the prior year. Payroll expense decreased primarily due to decreases
in commission, bonuses and other incentives resulting from lower store sales in
2002. The decrease in dollars was also a result of a reduction in headcount
during the second half of 2001. Advertising expense decreased in dollars for the
three and six months ended June 30, 2002, and decreased for the three month
period as a percentage of net sales when compared to the prior year periods.
Rent expense increased in both dollars and as a percentage of net sales when
compared to the same three and six month periods in the prior year. We expect
SG&A expense to grow slightly in dollars for 2002, when compared to 2001.
Net Interest Expense
Interest expense, net of interest income, for the three and six months ended
June 30, 2002 was $8.6 million and $17.6 million, respectively, versus $8.0
million and $16.6 million for the comparable three and six months in 2001.
Interest expense decreased $1.5 million and $3.7 million for the three and six
months ended June 30, 2002, respectively. The decrease in interest expense was
due to lower average debt outstanding during these periods compared to the prior
year. Interest income decreased $2.1 million and $4.7 million for the three and
six months ended June 30, 2002, respectively. The decrease in interest income
was due primarily to the pay-off of the CompUSA note receivable on June 22,
2001, which eliminated the associated interest income. We expect interest
expense, net of interest income, to be flat for calendar year 2002, when
compared to calendar year 2001.
Other Income
In the second quarter of 2002, we received payments and recorded income of $27.7
million in partial settlement of amounts owed to us under a tax sharing
agreement that was the subject of an arbitration styled Tandy Corporation and
T.E. Electronics, Inc. vs. O'Sullivan Industries Holdings, Inc. This partial
settlement followed a ruling in RadioShack's favor by the arbitration panel.
This arbitration was commenced in July 1999 and the settlement also requires
O'Sullivan to make ongoing payments under this tax sharing agreement that was
entered into by the parties at the time of O'Sullivan's initial public offering.
Provision for Income Taxes
Provision for income taxes for each quarterly period is based on the estimate of
the annual effective tax rate for the year, which we evaluate quarterly. The
effective tax rate for the quarter and six months ended June 30 of both 2002 and
2001 was 38.0%.
Impact of Recent Accounting Pronouncements
The Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment of Long-Lived
Assets" ("SFAS 144"), in October 2001, which establishes accounting and
reporting standards for the impairment and disposition of long-lived assets
(except unidentifiable intangibles), including discontinued operations. SFAS 144
became effective for all financial statements issued for fiscal years beginning
after December 15, 2001 and, generally, its provisions are to be applied
prospectively. We adopted SFAS 144 effective January 1, 2002, and there were no
material adjustments as a result of this adoption.
FINANCIAL CONDITION
Cash flow provided by operating activities approximated $315.4 million for the
six month period ended June 30, 2002, compared to $338.9 million in the prior
year comparable period. Cash flow from net income, adjusted for non-cash items,
decreased $38.6 million for the six months ended June 30, 2002, when compared to
the same period in the prior year. This decrease was due primarily to a decline
in sales in 2002. At June 30, 2002, changes in accounts receivable had provided
$123.9 million in cash since December 31, 2001, compared to $152.7 million in
cash provided for the six months ended June 30, 2001. This $28.8 million
difference in cash provided by accounts receivable was due to an increase in
collections of dealer/franchise receivables and vendor and service provider
receivables during the first half of 2001, as the 2000 year-end accounts
receivable balance was significantly higher than the 2001 year-end balance. At
June 30, 2002, changes in inventory had provided $119.2 million in cash since
December 31, 2001, compared to $190.2 million in cash provided for the six
months ended June 30, 2001. The reduction in inventory since December 31, 2001
was primarily the result of a decrease in cellular handset inventory.
Additionally, inventory reductions in the wired communication department, as
well as the personal electronics, seasonal and portable audio departments,
offset slightly by increases in both the computer and home entertainment
departments, added to the overall inventory reduction. The continued reduction
in inventory levels is the result of ongoing improvements in inventory
management. Additionally, during the first half of 2002, $68.7 million more in
cash was provided by accounts payable, when compared to the first half of 2001,
due primarily to more favorable vendor terms.
Cash used in investing activities for the six months ended June 30, 2002 was
$30.7 million, compared to cash provided of $60.4 million in the previous year.
During the second quarter of 2001, we received $123.6 million for the settlement
of the purchase price of Computer City, Inc. and settlement of the $136.0
million CompUSA note. Investing activities for the six months ended June 30,
2002 included capital expenditures totaling $34.0 million, compared to $62.1
million in 2001, primarily for our retail store expansions and remodels and
upgrades of information systems. We anticipate that the capital expenditure
requirements for 2002 will approximate $125.0 million to $130.0 million,
primarily relating to our continued store expansions and remodels and continuous
improvement of our information systems.
Cash used in financing activities for the six months ended June 30, 2002 was
$157.0 million, compared to a $193.9 million cash usage in the previous year. We
repurchased $163.4 million of common stock during the six months ended June 30,
2002, compared to $87.6 million during the same period of 2001. Stock
repurchases during the first six months of 2002 and 2001 were partially funded
by $30.2 million and $33.0 million, respectively, received from the sale of
treasury stock to employee stock plans and from stock option exercises.
Dividends paid, net of tax, in the first six months of 2002 and 2001 amounted to
$1.5 million and $22.1 million, respectively. The decrease in dividends paid in
2002 resulted from a change in our dividend payment frequency from quarterly to
annually during the third quarter of 2001. The net decrease in short-term debt
of $461.3 million for the six-month period ended June 30, 2001 was due to the
repayment of short-term debt with funds received from the 10-year notes issued
on May 11, 2001.
Free cash flow, defined as cash flow from operations less capital expenditures
and dividends paid, was $279.9 million for the six months ended June 30, 2002,
compared to $254.7 million for the corresponding period in 2001. This 2002
increase in free cash flow was due primarily to lower capital expenditures and
dividends paid in the first half of 2002. We expect free cash flow to be
approximately $300.0 million to $350.0 million in 2002.
At June 30, 2002, total capitalization was $1,408.0 million, which consisted of
$653.6 million of debt and $754.4 million of stockholders' equity, resulting in
a total debt to total capitalization ratio of 46.4%. The total debt to total
capitalization ratio was 46.3% at December 31, 2001 and 42.6% at June 30, 2001.
Long-term debt as a percentage of total capitalization was 41.4% and 39.0% at
June 30, 2002 and December 31, 2001, respectively, compared to 38.2% at June 30,
2001. The percentage increases since both June 30, 2001, and December 31, 2001,
were primarily the result of a reduction in equity due to increased 2002 share
repurchases.
In the second quarter of 2002, we replaced our existing $600.0 million credit
facilities with new credit facilities, also totaling $600.0 million. A syndicate
of 16 banks granted the new facilities. These facilities are comprised of a
$300.0 million 364-day revolving credit facility maturing in June 2003 and a
$300.0 million five-year revolving credit facility maturing in June 2007. The
terms of these revolving credit facilities are substantially similar to the
previous facilities. The new revolving credit facilities will support any future
commercial paper borrowings and are otherwise available for general corporate
purposes.
We repurchased 2.6 million and 4.5 million shares of our common stock for $80.2
million and $136.2 million for the three and six months ended June 30, 2002,
respectively, under our share repurchase program. In connection with our share
repurchase program, our Board of Directors has authorized us to sell up to 4.0
million shares of our common stock, through both equity forwards and put
options, with an expiration date no later than December 31, 2002. There are no
outstanding equity forward instruments or put options at June 30, 2002.
We may continue to execute share repurchases from time to time in order to take
advantage of attractive share price levels, as determined by management. The
timing and terms of the transactions depend on market conditions, our liquidity
and other considerations. We anticipate that we will repurchase between $250.0
million and $300.0 million of our common stock in total for the year 2002 under
our existing share repurchase program.
In the fourth quarter of 2001, we announced the sale of our corporate
headquarters building and our plans to construct a new headquarters in Fort
Worth, Texas. We entered into sale-leaseback agreements in 2001, whereby our
existing corporate headquarters land and buildings were sold and leased back to
us. These agreements provide us with the time necessary to arrange for the
construction of our new facility. We plan to finance the new corporate campus
with an off-balance sheet operating lease arrangement. We believe that this type
of structure, when used as designed and in moderation, enables us to maintain
financial flexibility and is appropriate. Management recognizes that the
accounting rules addressing this type of financing are currently under review
and that the structure may change, potentially making it uneconomical to execute
and requiring us to record the new corporate campus and related debt on our
balance sheet. We have explored alternatives in the event that such changes
occur and believe that we have a number of viable options available to finance
our corporate headquarters facility.
ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK.
At June 30, 2002, we did not have derivative instruments that materially
increased our exposure to market risks for interest rates, foreign currency
rates, commodity prices or other market price risks other than the interest rate
swaps noted below. We do not use derivative instruments for speculative
purposes.
Our exposure to market risk is principally the result of changes in short-term
interest rates. Interest rate risk exists principally with respect to $150.0
million of indebtedness, which, because of our interest rate swaps, effectively
bears interest at short-term floating rates. An unfavorable change of 100 basis
points in the interest rate applicable to this floating-rate indebtedness could
result in additional interest expense of $0.4 million quarterly. This assumes no
change in the principal or the incurrence of additional indebtedness.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Subject to court approval, we have reached agreement on a tentative settlement
of $29.9 million in a class action lawsuit originally filed in March 2000 in
Orange County, California. The lawsuit, captioned Omar Belazi, et al vs. Tandy
Corporation, et al, related to the alleged miscalculation of overtime wages for
certain of our former and current employees in that state. We denied liability.
Additionally, in the second quarter of 2002, we received payments of $27.7
million in partial settlement of amounts owed to us under a tax sharing
agreement that was the subject of an arbitration styled Tandy Corporation and
T.E. Electronics, Inc. vs. O'Sullivan Industries Holdings, Inc. This partial
settlement followed a ruling in RadioShack's favor by the arbitration panel.
This arbitration was commenced in July 1999 and the settlement also requires
O'Sullivan to make ongoing payments under this tax sharing agreement that was
entered into by the parties at the time of O'Sullivan's initial public offering.
We have various pending claims, lawsuits, disputes with third parties,
investigations and actions incidental to the operation of our business. Although
occasional adverse settlements or resolutions may occur and negatively impact
earnings in the year of settlement, it is our opinion that their ultimate
resolution will not have a materially adverse effect on our financial condition
or liquidity.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
a) RadioShack held its Annual Meeting of Stockholders on May 16, 2002.
b) (1) RadioShack elected directors to serve for the ensuing year. Out of
the 179,926,493 eligible votes, 147,900,203 votes were cast at the
meeting either by proxies solicited in accordance with Regulation 14A
under the Securities Act of 1934, or by security holders voting in
person. In the case of directors, abstentions are treated as votes
withheld and are included in the table. The tabulation of votes of the
matters submitted to a vote of security holders is set forth below:
VOTES VOTES
NAME OF DIRECTOR FOR WITHHELD
--------------------------- ----------------- -----------------
Frank J. Belatti 142,477,413 5,422,789
Ronald E. Elmquist 145,857,951 2,042,252
Richard J. Hernandez 145,808,545 2,091,657
Lawrence V. Jackson 145,214,049 2,686,153
Robert J. Kamerschen 145,899,953 2,000,249
Lewis F. Kornfeld, Jr. 144,853,714 3,046,489
Jack L. Messman 145,874,629 2,025,574
William G. Morton, Jr. 145,942,814 1,957,388
Thomas G. Plaskett 145,560,045 2,340,157
Leonard H. Roberts 145,844,667 2,055,535
Alfred J. Stein 145,878,824 2,021,378
William E. Tucker 145,567,678 2,332,525
Edwina D. Woodbury 145,879,295 2,020,907
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
a) Exhibits Required by Item 601 of Regulation S-K.
A list of the exhibits required by Item 601 of Regulation S-K and
filed as part of this report is set forth in the Index to Exhibits
on page 14, which immediately precedes such exhibits.
b) Reports on Form 8-K.
On July 16, 2002, we announced a proposed tentative settlement of a
class action lawsuit in the state of California. Additionally, we
announced in an unrelated matter that we had negotiated a favorable
settlement regarding a contractual dispute of a tax sharing
agreement. The Form 8-K was filed on July 16, 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
RadioShack Corporation
(Registrant)
Date: August 12, 2002 By /s/ David Johnson
-----------------------------------
David Johnson
Senior Vice President and Controller
(Authorized Officer)
Date: August 12, 2002 /s/ Michael D. Newman
------------------------------------
Michael D. Newman
Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)
RADIOSHACK CORPORATION
INDEX TO EXHIBITS
Exhibit
Number Description Page
3a Certificate of Amendment of Restated Certificate of
Incorporation dated May 18, 2000 (filed as Exhibit 3a to
RadioShack's Form 10-Q filed on August 11, 2000 for the
fiscal quarter ended June 30, 2000).
3a(i) Restated Certificate of Incorporation of RadioShack
Corporation dated July 26, 1999 (filed as Exhibit 3a(i) to
RadioShack's Form 10-Q filed on August 11, 1999 for the
fiscal quarter ended June 30, 1999).
3b* RadioShack Corporation Bylaws, amended and restated as
of May 16, 2002. 15
10a* Revolving Credit Agreement (Facility A) dated as of
June 19, 2002 among RadioShack Corporation, Citibank, N.A.,
as Administrative Agent, Paying Agent and Lender, Bank of
America, N.A. as Administrative Agent and Lender, Fleet
National Bank as Syndication Agent and Lender, Wachovia Bank,
National Association as Documentation Agent and Lender,
Salomon Smith Barney, Inc. as Joint Lead Arranger and
Bookrunner, Bank of America Securities, Inc. as Joint Lead
Arranger and Bookrunner and twelve other banks as Lenders. 24
10b* Revolving Credit Agreement (Facility B) dated as of
June 19, 2002 among RadioShack Corporation, Citibank, N.A.,
as Administrative Agent, Paying Agent and Lender, Bank of
America, N.A. as Administrative Agent, Initial Issuing
Bank and Lender, Fleet National Bank as Syndication Agent,
Initial Issuing Bank and Lender, Wachovia Bank,
National Association as Documentation Agent and Lender,
Salomon Smith Barney, Inc. as Joint Lead Arranger and
Bookrunner, Bank of America Securities, Inc. as Joint Lead
Arranger and Bookrunner and twelve other banks as Lenders. 79
11* Statements of Computation of Ratio of Earnings to Fixed
Charges. 137
99(a)* Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes - Oxley
Act of 2002. 138
99(b)* Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes - Oxley
Act of 2002. 139
----------------------------
* filed with this report
EXHIBIT 3b
RADIOSHACK CORPORATION BYLAWS
AMENDED AND RESTATED AS OF
May 16, 2002
ARTICLE I
OFFICES
SECTION 1. Registered Office. The Registered office of the Corporation
in the State of Delaware shall be located in the City of Wilmington, County of
New Castle, State of Delaware, and the name of the resident agent in charge
thereof shall be The Corporation Trust Company.
SECTION 2. Other Offices. The principal office shall be at 100
Throckmorton Street, Suite 1800, Fort Worth, Texas. The Corporation may also
have offices at other places as the Board of Directors may from time to time
appoint or the business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. Place of Meeting. All meetings of the stockholders for the
election of directors shall be held at such place within or without the State of
Delaware as the Board of Directors may designate, provided that at least ten
(10) days' notice must be given to the stockholders entitled to vote thereat of
the place so fixed. Until the Board of Directors shall designate otherwise the
annual meeting of stockholders and the election of directors shall take place at
the office of the Corporation at 100 Throckmorton Street, Suite 1800, Fort
Worth, Texas. Meetings of stockholders for any other purpose may be held at such
place and time as shall be stated in the notice of the meeting.
SECTION 2. Annual Meetings. The annual meeting of the stockholders
shall be held on the Third Thursday in May of each year, if not a legal holiday,
and if a legal holiday, then on the next business day following, at 10:00 A.M.,
or on such other date and at such other time as shall be designated from time to
time by the Board of Directors and stated in the notice of the meeting. At such
annual meetings the stockholders shall elect a Board of Directors by a plurality
vote and shall transact such other business as may properly be brought before
the meeting.
SECTION 3. Special Meetings. Special meetings of the stockholders, for
any purpose or purposes, unless otherwise prescribed by statute or the
Certificate of Incorporation, may be called by the Chairman of the Board or the
President, and shall be called by the Secretary at the request in writing of a
majority of the Board of Directors. Such request shall state the purpose or
purposes of the proposed meeting.
SECTION 4. Notice. Written or printed notice of every meeting of
stockholders, annual or special, stating the time and place thereof, and, if a
special meeting, the purpose or purposes in general terms for which the meeting
is called, shall not be less than ten (10) days before such meeting and shall be
served upon or mailed to each stockholder entitled to vote thereat, at his
address as it appears upon the books of the Corporation or, if such stockholder
shall have filed with the Secretary of the Corporation a written request that
notices intended for him be mailed to some other address, then to the address
designated in such request. Additionally, any notice to stockholders given by
the Corporation shall be effective if given by a form of electronic transmission
consented to by the stockholder to whom the notice is given. Any such consent
shall be revocable by the stockholder by written notice to the Secretary of the
Corporation.
SECTION 5. Quorum. Except as otherwise provided by law or by the
Certificate of Incorporation, the presence in person or by proxy at any meeting
of stockholders of the holders of a majority of the shares of the capital stock
of the Corporation issued and outstanding and entitled to vote thereat shall be
requisite and shall constitute a quorum. If, however, such majority shall not be
represented at any meeting of the stockholders regularly called, the holders of
a majority of the shares present in person or by proxy and entitled to vote
thereat shall have power to adjourn the meeting to another time, or to another
time and place, without notice other than announcement of adjournment at the
meeting, and there may be successive adjournments for like cause and in like
manner until the requisite amount of shares entitled to vote at such meeting
shall be represented. At such adjourned meeting at which the requisite amount of
shares entitled to vote thereat shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
SECTION 6. Votes. Proxies. At each meeting of stockholders every
stockholder shall have one vote for each share of capital stock entitled to vote
which is registered in his name on the books of the Corporation on the date on
which the transfer books were closed, if closed, or on the date set by the Board
of Directors for the determination of stockholders entitled to vote at such
meeting. At each such meeting every stockholder shall be entitled to vote in
person, or may authorize another person or persons to act for him by a proxy
which is in writing or transmitted as permitted by law, including without
limitation, electronically, via telegram, internet, interactive voice response
system, or other means of electronic transmission executed or authorized by such
stockholder or his attorney-in-fact, but no proxy shall be voted after three
years from its date, unless the proxy provides for a longer period. Any proxy
transmitted electronically shall set forth such information from which it can be
determined that such electronic transmission was authorized by the stockholder.
At all meetings of the stockholders, a quorum being present, all
matters shall be decided by majority vote of the shares of stock entitled to
vote held by stockholders present in person or by proxy, except as otherwise
required by the Certificate of Incorporation or the laws of the State of
Delaware. Unless so directed by the chairman of the meeting, or required by the
laws of the State of Delaware, the vote thereat on any question need not be by
ballot.
On a vote by ballot, each ballot shall be signed by the stockholder
voting, or in his name by his proxy, if there be such proxy, and shall state the
number of shares voted by him and the number of votes to which each share is
entitled. On a vote by ballot, the chairman shall appoint two inspectors of
election, who shall first take and subscribe an oath or affirmation faithfully
to execute the duties of inspector at such meeting with strict impartiality and
according to the best of their ability and who shall take charge of the polls
and after the balloting shall make a certificate of the result of the vote
taken; but no director or candidate for the office of director shall be
appointed as such inspector.
SECTION 7. Stock List. At least ten (10) days before every election of
directors, a complete list of stockholders entitled to vote at such election,
arranged in alphabetical order, with the residence of each and the number of
voting shares held by each shall be prepared by the Secretary. Such list shall
be open at the place where the election is to be held for said ten (10) days, to
the examination of any stockholder entitled to vote at that election and shall
be produced and kept at the time and place of election during the whole time
thereof, and subject to the inspection of any stockholder who may be present.
SECTION 8. Notice of Stockholder Proposals.
8. Notice of Stockholder Business; Nomination of Director Candidates.
(a) At annual meetings of the stockholders, only such
business shall be conducted as shall have been brought before the
meetings (i) pursuant to the Corporation's notice of meeting, (ii) by or
at the direction of the Board of Directors, or (iii) by any stockholder
of the Corporation who is a stockholder of record at the time of giving
of notice provided for in this Section 8, who shall be entitled to vote
at such meeting, and who complies with the notice procedures set forth
in this Section 8.
(b) Only persons who are nominated in accordance with the
procedures set forth in these Bylaws shall be eligible to serve as
directors. Nominations of persons for election to the Board of
Directors may be made at a meeting of stockholders (i) by or at the
direction of the Board of Directors or a committee thereof or (ii) by
any stockholder of the Corporation who is a stockholder of record at
the time of giving of notice provided for in this Section 8 who shall
be entitled to vote for the election of directors at the meeting, and
who complies with the notice procedures set forth in this Section 8.
(c) A stockholder must give timely, written notice to the
Secretary of the Corporation to nominate directors at an annual meeting
pursuant to Section 8 hereof or to propose business to be brought
before an annual or special meeting pursuant to clause (iii) of Section
8(a) hereof. To be timely in the case of an annual meeting, a
stockholder's notice must be received at the principal executive
offices of the Corporation not less than 120 days before the date of
the Corporation's proxy statement release to shareholders in connection
with the Corporation's previous year's annual meeting of stockholders.
To be timely in the case of a special meeting or in the event that the
date of the annual meeting is changed by more than 30 days from such
anniversary date, a stockholder's notice must be received at the
principal executive offices of the Corporation no later than the close
of business on the tenth day following the earlier of the day on which
notice of the meeting date was mailed or public disclosure of the
meeting date was made. For purposes of this Section 8, public
disclosure shall mean disclosure in a press release reported by the Dow
Jones News Service, Associated Press or comparable national news
service or in a document publicly filed by the Corporation with the
Securities and Exchange Commission pursuant to Section 13, 14 or 15(d)
of the Securities Exchange Act of 1934. Such stockholder's notice shall
set forth (i) with respect to each matter, if any, that the stockholder
proposes to bring before the meeting, a brief description of the
business desired to be brought before the meeting and the reasons for
conducting such business at the meeting, (ii) with respect to each
person, if any, whom the stockholder proposes to nominate for election
as a director, all information relating to such person (including such
person(s) written consent to being named in the proxy statement as a
nominee and to serving as a director) that is required under the
Securities Exchange Act of 1934, as amended, (iii) the name and
address, as they appear on the Corporation's records, of the
stockholder proposing such business or nominating such persons (as the
case may be), and the name and address of the beneficial owner, if any,
on whose behalf the proposal or nomination is made, (iv) the class and
number of shares of capital stock of the Corporation that are owned
beneficially and of record by such stockholder of record and by the
beneficial owner, if any, on whose behalf the proposal or nomination is
made, and (v) any material interest or relationship that such
stockholder of record and/or the beneficial owner, if any, on whose
behalf the proposal or nomination is made may respectively have in such
business or with such nominee. At the request of the Board of
Directors, any person nominated for election as a director shall
furnish to the Secretary of the Corporation the information required to
be set forth in a stockholder(s) notice of nomination which pertains to
the nominee.
(d) Notwithstanding anything in these Bylaws to the
contrary, no business shall be conducted, and no person shall be
nominated to serve as a director, at an annual or special meeting of
stockholders, except in accordance with the procedures set forth in this
Section 8. The Chairman of the meeting shall, if the facts warrant,
determine that business was not properly brought before the meeting, or
that a nomination was not made, in accordance with the procedures
prescribed by these Bylaws and, if he shall so determine, he shall so
declare to the meeting, and any such business not properly brought
before the meeting shall not be transacted and any defective nomination
shall be disregarded. A stockholder shall also comply with all
applicable requirements of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder with respect to the
matters set forth in this Section 8.
(e) This Section 8 shall not prevent the consideration and
approval or disapproval at the annual meeting of reports of officers,
directors and committees of the Board of Directors, but, in connection
with such reports, no business shall be acted upon at such annual
meeting unless stated, filed and received as herein provided.
ARTICLE III
DIRECTORS
SECTION 1. Number. The business and property of the Corporation shall
be conducted and managed by a Board of Directors consisting of not less than
three (3) or more than fourteen (14) members.
The Board of Directors of the Corporation shall initially be composed
of three (3) directors, but the Board may at any time by resolution increase or
decrease the number of directors to not more than fourteen (14) or less than
three (3). The vacancies resulting from any such increase in the Board of
Directors, or an increase resulting from an amendment of this Section, shall be
filled as provided in Section 3 of this ARTICLE III.
SECTION 2. Term of Office. Except as otherwise provided by law such
director shall hold office until the next annual meeting of stockholders, and
until his successor is duly elected and qualified or until his earlier death or
resignation.
SECTION 3. Vacancies. If any vacancy shall occur among the directors,
or if the number of directors shall at any time be increased, the directors in
office, although less than a quorum, by a majority vote may fill the vacancies
or newly created directorships, or any such vacancies or newly created
directorships may be filled by the stockholders at any meeting. When one or more
directors shall resign from the Board of Directors, effective at a future date,
a majority of the directors then in office, including those who have so
resigned, shall have power to fill such vacancy or vacancies, the vote thereon
to take effect when such resignation or resignations shall become effective, and
each director so chosen shall hold office as herein provided in the filling of
other vacancies.
SECTION 4. Meetings. Meetings of the Board of Directors shall be held
at such place within or without the State of Delaware as may from time to time
be fixed by resolution of the Board of Directors or by the Chairman of the
Board, or the CEO as may be specified in the notice or waiver of notice of any
meeting. A regular meeting of the Board of Directors may be held without notice
immediately following the annual meeting of stockholders at the place where such
annual meeting is held. Regular meetings of the Board may also be held without
notice at such time and place as shall from time to time be determined by
resolution of the Board of Directors.
Special meetings of the Board of Directors may be called by the
Chairman of the Board, the CEO or the Secretary and shall be called by the
Secretary on the written request of two members of the Board of Directors.
Notice of any special meeting shall be given to each director at least (a)
twelve (12) hours before the meeting by telephone or by being personally
delivered or transmitted electronically, via telegram, facsimile, internet or
other means of electronic transmission or (b) three (3) days before the meeting
if delivered by mail to the director's residence or usual place of business.
Such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage prepaid, or when transmitted if sent
electronically, via telegram, facsimile, internet or other means of electronic
transmission. Neither the business to be transacted at, nor the purpose of, any
special meeting of the Board of Directors needs to be specified in the notice or
waiver of notice of such meeting.
Members of the Board of Directors may participate in a meeting of such
Board by means of conference telephone or similar communication equipment or by
other means provided all persons participating in the meeting can hear each
other, and participation in the meeting pursuant hereto shall constitute
presence in person at such meeting.
Any director may waive notice of any meeting by a writing signed by the
director entitled to the notice and filed with the minutes or corporate records.
The attendance at or participation of the director at a meeting shall constitute
waiver of notice of such meeting, unless the director at the beginning of the
meeting or promptly upon his arrival objects to holding the meeting or
transacting business at the meeting.
SECTION 5. Quorum. A majority, but not less than two (2), of the
directors shall constitute a quorum for the transaction of business. If at any
meeting of the Board of Directors there shall be less than a quorum present, a
majority of those present may adjourn the meeting from time to time without
notice other than announcement of the adjournment at the meeting, and at such
adjourned meeting at which a quorum is present any business may be transacted
which might have been transacted at the meeting as originally notified.
SECTION 6. Compensation. The directors may be paid their expenses, if
any, of attendance at each meeting of the Board of Directors, a fixed sum for
attendance at each meeting of the Board of Directors and/or a stated fee as
director. No such payment shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor. Members
of the Executive Committee and/or of other committees may be allowed like
compensation and reimbursement of expenses for attending committee meetings.
SECTION 7. Chairman. From its members, the Board of Directors will
elect a chairman to preside over meetings of the shareholders and of the Board.
The Chairman may simultaneously serve as any Officer of the Corporation set
forth in Article V. The Board may elect one or more Vice Chairmen. In the
absence of the Chairman or a Vice Chairman, if any, the Board shall designate a
person to preside at such meetings. The director's fee of the Chairman and the
Vice Chairman, if any, will be set by the Board.
SECTION 8. Director Stock Ownership in the Corporation. Each director
elected or appointed to the Board of Directors shall own shares of common stock
of the Corporation. On and after the third annual anniversary of a director's
election or appointment to the Board of Directors, each director shall own
shares of common stock of the Corporation having a fair market value of not less
than 200% of the amount of the Board of Directors' annual retainer as then in
effect.
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
SECTION 1. Executive Committee. The Board of Directors may, by
resolution passed by a majority of the whole Board, appoint an Executive
Committee of two (2) or more members, to serve during the pleasure of the Board
of Directors, to consist of such directors as the Board of Directors may from
time to time designate. The Chairman of the Executive Committee shall be
designated by the Board of Directors.
SECTION 2. Procedure. The Executive Committee, by a vote of a majority
of its members, shall fix its own times and places of meeting, shall determine
the number of its members constituting a quorum for the transaction of business,
and shall prescribe its own rules of procedure, no change in which shall be made
save by a majority vote of its members. Members of the Executive Committee or
any other committee may participate in a meeting of such Committee by means of
conference telephone or similar communication equipment or by other means
provided all persons participating in the meeting can hear each other, and
participation in the meeting pursuant hereto shall constitute presence in person
at such meeting.
SECTION 3. Powers. During the intervals between the meetings of the
Board of Directors, the Executive Committee shall possess and may exercise all
the powers of the Board of Directors in the management and direction of the
business and affairs of the Corporation, to the extent permitted by law.
SECTION 4. Minutes. The Executive Committee shall keep regular minutes
of its proceedings and all action by the Executive Committee shall be reported
to the Board of Directors at its next meeting. Such action shall be subject to
review by the Board of Directors, provided that no rights of third parties shall
be affected by such review.
SECTION 5. Other Committees. From time to time the Board of Directors,
by the affirmative vote of a majority of the whole Board of Directors, may
appoint other committees for any purpose or purposes, and such committees shall
have such powers as shall be conferred by the resolution of appointment, and as
shall be permitted by law.
ARTICLE V
OFFICERS
SECTION 1. Officers. The Board of Directors shall elect, as officers, a
Chief Executive Officer ("CEO"), a President, a Treasurer and a Secretary, and
in their discretion one or more of the following officers: Executive Vice
Presidents, Senior Vice Presidents, Vice Presidents, Assistant Secretaries, and
Assistant Treasurers. Such officers shall be elected annually by the Board of
Directors at its first meeting following the annual meeting of stockholders, and
each shall hold office until the corresponding meeting of the Board of Directors
in the next year and until his successor shall have been duly elected and
qualified, or until he shall have died or resigned or shall have been removed in
the manner provided herein. The powers and duties of two or more offices may be
exercised and performed by the same person, except the offices of CEO and
Secretary.
SECTION 2. Vacancies. Any vacancy in any office may be filled for the
unexpired portion of the term by the Board of Directors at any regular or
special meeting.
SECTION 3. Chief Executive Officer The Chief Executive Officer shall be
the chief executive officer (CEO) of the Corporation. Subject to the direction
of the Board of Directors, he shall have and exercise direct charge of and
general supervision over the business and affairs of the Corporation and shall
perform such other duties as may be assigned to him from time to time by the
Board of Directors.
SECTION 4. President. The President shall perform such duties as the
Board of Directors may prescribe. In the absence or disability of the CEO, the
President shall perform and exercise the powers of the CEO. In addition, the
President shall perform such duties as from time to time may be delegated to him
by the CEO.
SECTION 5. Executive Vice Presidents. The Executive Vice Presidents
shall perform such duties as the Board of Directors may prescribe. In the
absence or disability of the CEO and President, the Executive Vice Presidents in
the order of their seniority or in such order as may be specified by the Board
of Directors, shall perform the duties of CEO. In addition, the Executive Vice
Presidents shall perform such duties as may from time to time be delegated to
them by the CEO.
SECTION 6. Senior Vice Presidents. The Senior Vice Presidents shall
perform such duties as the Board of Directors may prescribe. In the absence or
disability of the CEO, President, and the Executive Vice Presidents, the Senior
Vice Presidents in the order of their seniority or in such other order as may be
specified by the Board of Directors, shall perform the duties and exercise the
powers of the President. In addition, the Senior Vice Presidents shall perform
such duties as from time to time may be delegated to them by the CEO.
SECTION 7. Vice Presidents. The Vice Presidents shall perform such
duties as the Board of Directors may prescribe. In the absence or disability of
the CEO, President, the Executive Vice Presidents and the Senior Vice
Presidents, the Vice Presidents in the order of their seniority or in such other
order as may be specified by the Board of Directors, shall perform the duties
and exercise the powers of the President. In addition, the Vice Presidents shall
perform such duties as may from time to time be delegated to them by the CEO.
SECTION 8. Treasurer. The Treasurer shall have charge of and be
responsible for all funds, securities, receipts and disbursements of the
Corporation, and shall deposit, or cause to be deposited, in the name of the
Corporation, all moneys or other valuable effects in such banks, trust companies
or other depositaries as shall, from time to time, be selected by the Board of
Directors; he may endorse for collection on behalf of the Corporation, checks,
notes and other obligations; he may sign receipts and vouchers for payments made
to the Corporation; singly or jointly with another person as the Board of
Directors may authorize, he may sign checks of the Corporation and pay out and
dispose of the proceeds under the direction of the Board of Directors; he shall
cause to be kept correct books of account of all the business and transactions
of the Corporation, shall see that adequate audits thereof are currently and
regularly made, and shall examine and certify the accounts of the Corporation;
he shall render to the Board of Directors, the Executive Committee, the Chairman
of the Board, the Vice Chairman, the CEO or to the President, whenever
requested, an account of the financial condition of the Corporation; he may sign
with the Chairman of the Board, the Vice Chairman of the Board, the CEO, the
President or a Vice President, certificates of stock of the Corporation; and, in
general, shall perform all the duties incident to the office of a treasurer of a
Corporation, and such other duties as from time to time may be assigned to him
by the Board of Directors.
SECTION 9. Assistant Treasurers. The Assistant Treasurers in order of
their seniority shall, in the absence or disability of the Treasurer, perform
the duties and exercise the powers of the Treasurer and shall perform such other
duties as the CEO, or the Board of Directors shall prescribe.
SECTION 10. Secretary. The Secretary shall keep the minutes of all
meetings of the stockholders and of the Board of Directors in books provided for
the purpose; he shall see that all notices are duly given in accordance with the
provisions of law and these Bylaws; he shall be custodian of the records and of
the corporate seal or seals of the Corporation; he shall see that the corporate
seal is affixed to all documents, the execution of which, on behalf of the
Corporation, under its seal, is duly authorized and when the seal is so affixed
he may attest the same; he may sign, with the Chairman of the Board, the Vice
Chairman, the CEO, the President or a Vice President, certificates of stock of
the Corporation; and in general he shall perform all duties incident to the
office of a secretary of a corporation, and such other duties as from time to
time may be assigned to him by the Board of Directors or the CEO.
SECTION 11. Assistant Secretaries. The Assistant Secretaries in order
of their seniority shall, in the absence or disability of the Secretary, perform
the duties and exercise the powers of the Secretary and shall perform such other
duties as the CEO, or the Board of Directors shall prescribe.
SECTION 12. Subordinate Officers. The Board of Directors may appoint
such subordinate officers as it may deem desirable. Each such officer shall hold
office for such period, have such authority and perform such duties as the Board
of Directors may prescribe. The Board of Directors may, from time to time,
authorize any officer to appoint and remove subordinate officers and to
prescribe the powers and duties thereof.
SECTION 13. Compensation. The Board of Directors shall have power to
fix the compensation of all officers of the Corporation. It may authorize any
officer, upon whom the power of appointing subordinate officers may have been
conferred, to fix the compensation of such subordinate officers.
SECTION 14. Removal. Any officer of the Corporation may be
removed, with or without cause, by a majority vote of the Board of Directors at
a meeting called for that purpose.
SECTION 15. Bonds. The Board of Directors may require any officer of
the Corporation to give a bond to the Corporation, conditional upon the faithful
performance of his duties, with one or more sureties and in such amounts as may
be satisfactory to the Board of Directors.
ARTICLE VI
CERTIFICATES OF STOCK
SECTION 1. Form and Execution of Certificates. The interest of each
stockholder of the Corporation shall be evidenced by a certificate or
certificates for shares of stock in such form as may be prescribed from time to
time by law and by the Board of Directors. The certificates of stock of each
class and series now authorized or which may hereafter be authorized by the
Certificate of Incorporation shall be consecutively numbered and signed by
either the Chairman of the Board or the CEO or the President or a Vice President
together either with the Secretary or an Assistant Secretary or the Treasurer or
an Assistant Treasurer of the Corporation, and may be countersigned and
registered in such manner as the Board of Directors may prescribe, and shall
bear the corporate seal or a printed or engraved facsimile thereof. Where any
such certificate is signed by a transfer agent or transfer clerk and by a
registrar, the signatures of any such Chairman of the Board, CEO, President,
Vice President, Treasurer, Assistant Treasurer, Secretary or Assistant Secretary
upon such certificate may be facsimiles engraved or printed. The signatures by a
transfer agent or transfer clerk and by a registrar may be either in facsimile
form or manual form. In case any officer or officers who shall have signed, or
whose facsimile signature or signatures shall have been placed upon, such
certificate or certificates shall have ceased to be such, whether because of
death, resignation or otherwise, before such certificate or certificates shall
have been issued and delivered, such certificate or certificates may
nevertheless be issued and delivered with the same effect as if such officer or
officers had not ceased to be such at the date of its issue and delivery.
SECTION 2. Transfer of Shares. The shares of the stock of the
Corporation shall be transferred on the books of the Corporation by the holder
thereof in person or by his attorney lawfully constituted, upon surrender for
cancellation of certificates for the same number of shares, with an assignment
and power of transfer endorsed thereon or attached thereto, duly executed, with
such proof or guaranty of the authenticity of the signature as the Corporation
or its agents may reasonably require. The Corporation shall be entitled to treat
the holder of record of any share or shares of stock as the holder in fact
thereof and accordingly shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other person
whether or not it shall have express or other notice thereof, except as
otherwise expressly provided by law.
SECTION 3. Closing of Transfer Books and Record Dates. The Board of
Directors may in its discretion prescribe in advance a period not exceeding
sixty (60) days prior to the date of any meeting of the stockholders or prior to
the last day on which the consent or dissent of stockholders may be effectively
expressed for any purpose without a meeting, during which no transfer of stock
on the books of the Corporation may be made; or in lieu of prohibiting the
transfer of stock, may fix in advance a time not more than sixty (60) days prior
to the date of any meeting of stockholders or prior to the last day on which the
consent or dissent of stockholders may be effectively expressed for any purpose
without a meeting, as the time as of which stockholders entitled to notice of
and to vote at such a meeting or whose consent or dissent is required or may be
expressed for any purpose, as the case may be, shall be determined; and all
persons who were holders of record of voting stock at such time and no others
shall be entitled to notice of and to vote at such meeting or to express their
consent or dissent, as the case may be, notwithstanding any transfer of any
stock on the books of the Corporation after any record date fixed as aforesaid.
The Board of Directors may also, in its discretion, fix in advance a date not
exceeding sixty (60) days preceding the date fixed for the payment of any
dividend or the making of any distribution, or for the delivery of evidence of
rights, or evidences of interests arising out of any issuance, change,
conversion or exchange of capital stock, as a record date for the determination
of the stockholders entitled to receive or participate in any such dividend,
distribution, rights or interests, notwithstanding any transfer of any stock on
the books of the Corporation after any record date fixed as aforesaid, or, at
its option, in lieu of so fixing a record date, may prescribe in advance a
period not exceeding sixty (60) days prior to the date for such payment,
distribution or delivery during which no transfer of stock on the books of the
Corporation may be made.
SECTION 4. Lost or Destroyed Certificates. In case of the loss or
destruction of any outstanding certificate of stock, a new certificate may be
issued upon the following conditions:
The owner of said certificate shall file with the Secretary of the
Corporation an affidavit giving the facts in relation to the ownership, and in
relation to the loss or destruction of said certificate, stating its number and
the number of shares represented thereby; such affidavit to be in such form and
contain such statements as shall satisfy the Chairman of the Board and Secretary
that said certificate has been accidentally destroyed or lost, and that a new
certificate ought to be issued in lieu thereof. Upon being so satisfied, the
Chairman of the Board and Secretary shall require such owner to file with the
Secretary a bond in such penal sum and in such form as they may deem advisable,
and with a surety or sureties approved by them, to indemnify and save harmless
the Corporation from any claim, loss, damage or liability which may be
occasioned by the issuance of a new certificate in lieu thereof, or if they deem
it appropriate, to waive the requirement to secure a bond with a surety. Upon
such bond being so filed, a new certificate for the same number of shares shall
be issued to the owner of the certificate so lost or destroyed; and the transfer
agent and registrar of stock, if any, shall countersign and register such new
certificate upon receipt of a written order signed by the said Chairman of the
Board and Secretary, and thereupon the Corporation will save harmless said
transfer agent and registrar in the premises. The CEO or the President or any
Vice President may act hereunder in the stead of the Chairman of the Board, and
an Assistant Secretary in the stead of the Secretary. In case of the surrender
of the original certificate, in lieu of which a new certificate has been issued,
or the surrender of such new certificate, for cancellation, the bond of
indemnity given as a condition of the issue of such new certificate may be
surrendered. A new certificate may be issued without requiring any bond when in
the judgment of the Board of Directors it is proper to do so.
ARTICLE VII
CHECKS, NOTES, ETC.
SECTION 1. Execution of Checks, Notes, etc. All checks and drafts on
the Corporation's bank accounts and all bills of exchange and promissory notes,
and all acceptances, obligations and other instruments for the payment of money,
shall be signed by such officer or officers, agent or agents, as shall be
thereunto authorized from time to time by the Board of Directors.
SECTION 2. Execution of Contracts, Assignments, etc. All contracts,
agreements, endorsements, assignments, transfers, stock powers, or other
instruments (except as provided in Sections 1 and 3 of this Article VII) shall
be signed by the CEO, the President, any Executive Vice President, Senior Vice
President, or Vice President and by the Secretary or any Assistant Secretary or
the Treasurer or any Assistant Treasurer, or by such other officer or officers,
agent or agents, as shall be thereunto authorized from time to time by the Board
of Directors.
SECTION 3. Execution of Proxies. The Chairman of the Board, the CEO,
President, any Executive Vice President, or Senior Vice President or Vice
President of the Corporation may authorize from time to time the signature and
issuance of proxies to vote upon shares of stock of other companies standing in
the name of the Corporation. All such proxies shall be signed in the name of the
Corporation by the Chairman of the Board, the CEO, President, any Executive Vice
President, Senior Vice President or Vice President and by the Secretary or an
Assistant Secretary.
ARTICLE VIII
WAIVERS AND CONSENTS
SECTION 1. Waivers. Whenever under the provisions of any law or under
the provisions of the Certificate of Incorporation of the Corporation or these
Bylaws, the Corporation, or the Board of Directors or any committee thereof, is
authorized to take any action after notice to stockholders or the directors or
the members of such committee, or after the lapse of a prescribed period of
time, such action may be taken without notice and without the lapse of any
period of time if, at any time before or after such action be completed, such
requirements be waived in writing by the person or persons entitled to said
notice or entitled to participate in the action to be taken, or, in the case of
a stockholder, by his attorney thereunto authorized.
SECTION 2. Consents. Any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee of the Board of
Directors may be taken without a meeting, if prior to such action a written
consent thereto is signed by all members of the Board of Directors or of such
committee as the case may be, and such written consent is filed with the minutes
of proceedings of the Board of Directors or of such committee.
ARTICLE IX
DIVIDENDS AND RESERVE FUNDS
SECTION 1. Dividends. Except as otherwise provided by law or by the
Certificate of Incorporation, the Board of Directors may declare dividends out
of the surplus of the Corporation at such times and in such amounts as it may
from time to time designate.
SECTION 2. Reserve Funds. Before crediting net profits to the surplus
in any year, there may be set aside out of the net profits of the Corporation
for that year such sum or sums as the Board of Directors from time to time in
its absolute discretion may deem proper as a reserve fund or funds to meet
contingencies or for equalizing dividends or for repairing or maintaining any
property of the Corporation or for such other purpose as the Board of Directors
shall deem conducive to the interests of the Corporation.
ARTICLE X
INSPECTION OF BOOKS
The Board of Directors shall determine from time to time whether, and
if allowed when and under what conditions and regulations, the accounts and
books of the Corporation (except such as may by statute be specifically open to
inspection) or any of them shall be open to the inspection of the stockholders;
and the stockholders' rights in this respect are and shall be restricted and
limited accordingly.
ARTICLE XI
FISCAL YEAR
The fiscal year of the Corporation shall end on the thirty first day of
December each year, unless another date shall be fixed by resolution of the
Board of Directors. After such date is fixed, it may be changed for future
fiscal years at any time or from time to time by further resolution of the Board
of Directors.
ARTICLE XII
SEAL
The corporate seal shall be circular in form and shall contain the name
of the Corporation, the state of incorporation, and the words "Corporate Seal".
ARTICLE XIII
AMENDMENTS
SECTION 1. By Stockholders. These Bylaws may be amended by a majority
vote of the stock entitled to vote and present or represented at any annual or
special meeting of the stockholders at which a quorum is present or represented,
if notice of the proposed amendment shall have been contained in the notice of
the meeting.
SECTION 2. By Directors. Except as otherwise specifically provided in
the Bylaws, if any, adopted by the stockholders, these Bylaws may be amended by
the affirmative vote of a majority of the Board of Directors, at any regular
meeting or special meeting thereof, if notice of the proposed amendment shall
have been contained in the notice of such meeting. If any Bylaw regulating an
impending election of directors is adopted or amended or repealed by the Board
of Directors, there shall be set forth in the notice of the next meeting of the
stockholders for the election of directors the Bylaws so adopted or amended or
repealed together with a concise statement of the changes made.
ARTICLE XIV
INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND AGENTS
The Corporation shall indemnify and reimburse each person, and his
heirs, executors or administrators, who is made or is threatened to be made a
party to any action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he was or is a director, officer,
employee or agent of the Corporation or was or is serving at the request of the
Corporation as a director, officer, employee or agent of another Corporation,
partnership, joint venture, trust, or other enterprise, against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement,
actually or reasonably incurred by him in connection with such action, suit or
proceeding and shall advance the expenses incurred by any officer or director in
defending any such action, suit or proceeding to the full extent permitted by
Section 145 of the General Corporation Law of the State of Delaware as it may be
amended or supplemented from time to time. Such right of indemnification or
advancement of expenses of any such person shall not be deemed exclusive of any
other rights to which he may be entitled under any statute, bylaw, agreement,
vote of stockholders or disinterested directors or otherwise, both as to action
in his official capacity and as to action in another capacity while holding such
office.
The foregoing provisions of this Article XIV shall be deemed to be a
contract between the Corporation and each person who serves in any capacity
specified therein at any time while this bylaw is in effect, and any repeal or
modification thereof shall not affect any rights or obligations then existing
with respect to any state of facts then or theretofor existing or any action,
suit or proceeding theretofor or thereafter brought based in whole or in part
upon any such state of facts.
EXHIBIT 10a
364-DAY CREDIT AGREEMENT
Dated as of June 19, 2002
RADIOSHACK CORPORATION, a Delaware corporation (the "Borrower"),
the banks, financial institutions and other institutional lenders (the "Initial
Lenders")listed on the signature pages hereof, BANK OF AMERICA, N.A., as
administrative agent, FLEET NATIONAL BANK, as syndication agent, WACHOVIA BANK,
NATIONAL ASSOCIATION, as documentation agent, SALOMON SMITH BARNEY INC. and BANC
OF AMERICA SECURITIES INC., as joint lead arrangers and bookrunners, and
CITIBANK, N.A. ("Citibank"), as administrative agent and as paying agent (the
"Agent") for the Lenders (as hereinafter defined), agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"Advance" means a Revolving Credit Advance or a Competitive Bid
Advance.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such
Person. For purposes of this definition, the term "control"
(including the terms "controlling", "controlled by" and "under common
control with") of a Person means the possession, direct or indirect, of
the power to vote 5% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such
Person, whether through the ownership of Voting Stock, by contract or
otherwise.
"Agent's Account" means the account of the Agent maintained by
the Agent at Citibank at its office at 388 Greenwich Street, New
York, New York 10013, Account No. 36852248, Attention: Bank Loan
Syndications.
"Applicable Lending Office" means, with respect to each Lender,
such Lender's Domestic Lending Office in the case of a Base Rate
Advance and such Lender's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance and, in the case of a Competitive Bid Advance,
the office of such Lender notified by such Lender to the Agent as its
Applicable Lending Office with respect to such Competitive Bid Advance.
"Applicable Margin" means (a) for Base Rate Advances, 0% per
annum and (b)for Eurodollar Rate Advances, as of any date, a
percentage per annum determined by reference to the Borrower's Rating
Level in effect on such date as set forth below:
-------------------------- -------------------------- --------------------------
Rating Level Applicable Margin for Applicable Margin for
Eurodollar Rate Advances Eurodollar Rate Advances
Prior to the Term Loan On and After to the Term
Conversion Date Loan Conversion Date
-------------------------- -------------------------- --------------------------
Level 1
-------
A/A2/A or above 0.210% 0.500%
---------------------------- ------------------------ --------------------------
Level 2
-------
A-/A3/A- 0.320% 0.750%
---------------------------- ------------------------ --------------------------
Level 3
-------
BBB+/Baa1/BBB+ 0.525% 1.000%
---------------------------- ------------------------ --------------------------
Level 4
-------
BBB/Baa2/BBB 0.625% 1.125%
---------------------------- ------------------------ --------------------------
Level 5
-------
Lower than Level 4 0.825% 1.500%
---------------------------- ------------------------ --------------------------
"Applicable Percentage" means, as of any date a percentage per
annum determined by reference to the Borrower's Rating Level in effect
on such date as set forth below:
---------------------------- --------------------------------
Rating Level Applicable
Percentage
---------------------------- --------------------------------
Level 1
-------
A/A2/A or above 0.065%
---------------------------- --------------------------------
Level 2
-------
A-/A3/A- 0.080%
---------------------------- --------------------------------
Level 3
-------
BBB+/Baa1/BBB+ 0.100%
---------------------------- --------------------------------
Level 4
-------
BBB/Baa2/BBB 0.125%
---------------------------- --------------------------------
Level 5
-------
Lower than Level 4 0.175%
---------------------------- --------------------------------
"Applicable Utilization Fee" means, as of any date prior to the
Term Loan Conversion Date that the aggregate Advances exceed 33 1/3% of
the aggregate Commitments, a percentage per annum determined by
reference to the Borrower's Rating Level in effect on such date as set
forth below:
---------------------------- --------------------------------
Rating Level Applicable
Utilization Fee
---------------------------- --------------------------------
Level 1
-------
A/A2/A or above 0.050%
---------------------------- --------------------------------
Level 2
-------
A-/A3/A- 0.100%
---------------------------- --------------------------------
Level 3
-------
BBB+/Baa1/BBB+ 0.125%
---------------------------- --------------------------------
Level 4
-------
BBB/Baa2/BBB 0.125%
---------------------------- --------------------------------
Level 5
-------
Lower than Level 4 0.250%
---------------------------- --------------------------------
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by
the Agent, in substantially the form of Exhibit C hereto.
"Assuming Lender" has the meaning specified in Section 2.18(c).
"Assumption Agreement" has the meaning specified in Section
2.18(c).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the highest of:
(a) the rate of interest announced publicly by Citibank
in New York, New York, from time to time, as Citibank's base
rate;
(b) the sum (adjusted to the nearest 1/4 of 1% or, if
there is no nearest 1/4 of 1%, to the next higher 1/4 of 1%) of
(i) 1/2 of 1% per annum, plus (ii) the rate obtained by dividing
(A) the latest three-week moving average of secondary market
morning offering rates in the United States for three-month
certificates of deposit of major United States money market
banks, such three-week moving average (adjusted to the basis of
a year of 360 days) being determined weekly on each Monday (or,
if such day is not a Business Day, on the next succeeding
Business Day) for the three-week period ending on the previous
Friday by Citibank on the basis of such rates reported by
certificate of deposit dealers to and published by the Federal
Reserve Bank of New York or, if such publication shall be
suspended or terminated, on the basis of quotations for such
rates received by Citibank from three New York certificate of
deposit dealers of recognized standing selected by Citibank, by
(B) a percentage equal to 100% minus the average of the daily
percentages specified during such three-week period by the Board
of Governors of the Federal Reserve System (or any successor)
for determining the maximum reserve requirement (including, but
not limited to, any emergency, supplemental or other marginal
reserve requirement) for Citibank with respect to liabilities
consisting of or including (among other liabilities) three-month
U.S. dollar non-personal time deposits in the United States,
plus (iii) the average during such three-week period of the
annual assessment rates estimated by Citibank for determining
the then current annual assessment payable by Citibank to the
Federal Deposit Insurance Corporation (or any successor) for
insuring U.S. dollar deposits of Citibank in the United States;
and
(c) 1/2 of one percent per annum above the Federal Funds
Rate.
"Base Rate Advance" means a Revolving Credit Advance that bears
interest as provided in Section 2.07(a)(i).
"Borrowing" means a Revolving Credit Borrowing or a Competitive
Bid Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the
applicable Business Day relates to any Eurodollar Rate Advances or
LIBO Rate Advances, on which dealings are carried on in the London
interbank market.
"Capital Lease" means any lease required to be accounted for as
a capital lease.
"Commitment" means, with respect to any Lender at any time, the
amount set forth opposite such Lender's name on the signature pages
hereto under the caption "Commitment" or, if such Lender has entered
into one or more Assignment and Acceptances, set forth for such Lender
in the Register maintained by the Agent pursuant to Section 8.07(d) as
such Lender's "Commitment", as such amount may be reduced at or prior
to such time pursuant to Section 2.05.
"Competitive Bid Advance" means an advance by a Lender to the
Borrower as part of a Competitive Bid Borrowing resulting from the
competitive bidding procedure described in Section 2.03 and refers to
a Fixed Rate Advance or a LIBO Rate Advance.
"Competitive Bid Borrowing" means a borrowing consisting
of simultaneous Competitive Bid Advances from each of the Lenders whose
offer to make one or more Competitive Bid Advances as part of such
borrowing has been accepted under the competitive bidding procedure
described in Section 2.03.
"Competitive Bid Note" means a promissory note of the Borrower
payable to the order of any Lender, in substantially the form of
Exhibit A-2 hereto, evidencing the indebtedness of the Borrower to
such Lender resulting from a Competitive Bid Advance made by such
Lender.
"Confidential Information" means information that the Borrower
furnishes to the Agent or any Lender in a writing designated as
confidential, but does not include any such information that is or
becomes generally available to the public or that is or becomes
available to the Agent or such Lender from a source other than the
Borrower.
"Consenting Lender" has the meaning specified in
Section 2.18(b).
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Consolidated EBITDA" means, for any period, for the Borrower
and its Subsidiaries, calculated on a Consolidated basis, the sum
of without duplication) the following: (a) Pretax Net Income
(excluding therefrom, to the extent included in determining Pretax Net
Income, any items of extraordinary gain, including net gains on the
sale of assets other than asset sales in the ordinary course of
business, and adding thereto, to the extent included in determining
Pretax Net Income, any items of extraordinary loss, including net
losses on the sale of assets other than asset sales in the ordinary
course of business), plus (b) to the extent included in determining
Pretax Net Income, interest expense (including interest expense in
respect of Capital Leases), plus (c) to the extent included in
determining Pretax Net Income, depreciation and amortization and
other non-cash charges, minus (d) to the extent included in
determining Pretax Net Income, non-cash credits.
"Consolidated EBITDAR" means, for any period, for the Borrower
and its Subsidiaries, calculated on a Consolidated basis, the sum of
(without duplication) the following: (a) Consolidated EBITDA plus
(b) to the extent included in determining Pretax Net Income, rental
expense (including rental expense in respect of Capital Leases).
"Consolidated Funded Debt" means, at any date, for the Borrower
and its Subsidiaries on a Consolidated basis, Debt of the types
described in clauses (a), (b), (c) and (e) of the definition of "Debt".
"Consolidated Tangible Net Worth" means, at any time, the total
Consolidated stockholders' equity less the total amount of Consolidated
intangible assets and plus the total amount of any subordinated
indebtedness unless already included in stockholders' equity, in each
case calculated for the Borrower and its Subsidiaries taken as a whole.
Intangible assets shall include unamortized debt discount and expense,
unamortized deferred charges and goodwill.
"Convert", "Conversion" and "Converted" each refers to a
conversion of Revolving Credit Advances of one Type into Revolving
Credit Advances of the other Type pursuant to Section 2.08 or 2.09.
"Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of property or services
(other than trade payables not overdue by more than 60 days incurred in
the ordinary course of such Person's business), (c) all obligations of
such Person evidenced by notes, bonds, debentures or other similar
instruments, (d) all obligations of such Person created or arising under
any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of
the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), (e) all obligations
of such Person as lessee under Capital Leases, (f) all obligations,
contingent or otherwise, of such Person in respect of acceptances,
letters of credit or similar extensions of credit, (g) all obligations
of such Person in respect of Hedge Agreements, (h) all Debt of others
referred to in clauses (a) through (g) above or clause (i) below and
other payment obligations guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or indirectly by
such Person through an agreement (1) to pay or purchase such Debt or to
advance or supply funds for the payment or purchase of such Debt, (2) to
purchase, sell or lease (as lessee or lessor) property, or to purchase
or sell services, primarily for the purpose of enabling the debtor to
make payment of such Debt or to assure the holder of such Debt against
loss, (3) to supply funds to or in any other manner invest in the debtor
(including any agreement to pay for property or services irrespective of
whether such property is received or such services are rendered) or
(4) otherwise to assure a creditor against loss, and (i) all Debt
referred to in clauses (a) through (h) above secured by (or for which
the holder of such Debt has an existing right, contingent or otherwise,
to be secured by) any Lien on property (including, without limitation,
accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Debt.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assumption
Agreement or the Assignment and Acceptance pursuant to which it became a
Lender, or such other office of such Lender as such Lender may from time
to time specify to the Borrower and the Agent.
"Effective Date" has the meaning specified in Section 3.01.
"Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
Lender and (iii)any other Person approved by the Agent and, unless an
Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 8.07, the Borrower,
such approval not to be unreasonably withheld or delayed; provided,
however, that neither the Borrower nor an Affiliate of the Borrower
shall qualify as an Eligible Assignee.
"Environmental Action" means any action, suit, demand,
demand letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental Law,
Environmental Permit or Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or other
actions or damages and (b) by any governmental or regulatory authority
or any third party for damages, contribution, indemnification, cost
recovery, compensation or injunctive relief.
"Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, judgment,decree
or judicial or agency interpretation, policy or guidance relating to
pollution or protection of the environment, health, safety or natural
resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval,
identification number, license or other authorization required under any
Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV
of ERISA is a member of the Borrower's controlled group, or under common
control with the Borrower, within the meaning of Section 414 of the
Internal Revenue Code.
"ERISA Event" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event has
been waived by the PBGC, or (ii) the requirements of subsection (1) of
Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver with
respect to a Plan; (c) the provision by the administrator of any Plan of
a notice of intent to terminate such Plan pursuant to Section 4041(a)
(2) of ERISA (including any such notice with respect to a plan amendment
referred to in Section 4041(e) of ERISA); (d) the cessation of
operations at a facility of the Borrower or any ERISA Affiliate in the
circumstances described in Section 4062(e) of ERISA; (e) the withdrawal
by the Borrower or any ERISA Affiliate from a Multiple Employer Plan
during a plan year for which it was a substantial employer, as defined
in Section 4001(a)(2) of ERISA; (f) the conditions for the imposition of
a lien under Section 302(f) of ERISA shall have been met with respect to
any Plan; (g) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or
(h) the institution by the PBGC of proceedings to terminate a Plan
pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA that constitutes grounds
for the termination of, or the appointment of a trustee to administer,
a Plan.
"Eurocurrency Liabilities" has the meaning assigned to that term
in Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any
Lender, the office of such Lender specified as its "Eurodollar Lending
Office" opposite its name on Schedule I hereto or in the Assumption
Agreement or the Assignment and Acceptance pursuant to which it became a
Lender (or, if no such office is specified, its Domestic Lending
Office), or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Agent.
"Eurodollar Rate" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same Revolving Credit
Borrowing, an interest rate per annum equal to the rate per annum
obtained by dividing (a) the rate per annum (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum) appearing on Telerate
Markets Page 3750 (or any successor page) as the London interbank
offered rate for deposits in U.S. dollars at approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period or, if for
any reason such rate is not available, the average (rounded upward to
the nearest whole multiple of 1/16 of 1% per annum, if such average is
not such a multiple) of the rate per annum at which deposits in U.S.
dollars are offered by the principal office of each of the Reference
Banks in London, England to prime banks in the London interbank market
at 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to such Reference
Bank's Eurodollar Rate Advance comprising part of such Revolving Credit
Borrowing to be outstanding during such Interest Period and for a period
equal to such Interest Period by (b) a percentage equal to 100% minus
the Eurodollar Rate Reserve Percentage for such Interest Period. If the
Telerate Markets Page 3750 (or any successor page) is unavailable, the
Eurodollar Rate for any Interest Period for each Eurodollar Rate Advance
comprising part of the same Revolving Credit Borrowing shall be
determined by the Agent on the basis of applicable rates furnished to
and received by the Agent from the Reference Banks two Business Days
before the first day of such Interest Period, subject, however, to the
provisions of Section 2.08.
"Eurodollar Rate Advance" means a Revolving Credit Advance that
bears interest as provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for
all Eurodollar Rate Advances or LIBO Rate Advances comprising part of
the same Borrowing means the reserve percentage applicable two Business
Days before the first day of such Interest Period under regulations
issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental
or other marginal reserve requirement) for a member bank of the Federal
Reserve System in New York City with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities (or with
respect to any other category of liabilities that includes deposits by
reference to which the interest rate on Eurodollar Rate Advances or LIBO
Rate Advances is determined) having a term equal to such Interest
Period.
"Events of Default" has the meaning specified in Section 6.01.
"Extension Date" has the meaning specified in Section 2.18(b).
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by the Agent.
"Fitch" means Fitch, Inc.
"Fixed Rate Advances" has the meaning specified in
Section 2.03(a)(i).
"GAAP" has the meaning specified in Section 1.03.
"Hazardous Materials" means (a) petroleum and petroleum
products, by products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas
and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"Information Memorandum" means the information memorandum dated
May 14, 2002 used by the Agent in connection with the syndication of the
Commitments.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Revolving Credit Borrowing and each LIBO
Rate Advance comprising part of the same Competitive Bid Borrowing, the
period commencing on the date of such Eurodollar Rate Advance or LIBO
Rate Advance or the date of the Conversion of any Base Rate Advance into
such Eurodollar Rate Advance and ending on the last day of the period
selected by the Borrower pursuant to the provisions below and,
thereafter, with respect to Eurodollar Rate Advances, each subsequent
period commencing on the last day of the immediately preceding Interest
Period and ending on the last day of the period selected by the Borrower
pursuant to the provisions below. The duration of each such Interest
Period shall be one, two, three or six months, as the Borrower may, upon
notice received by the Agent not later than 12:00 noon (New York City
time) on the third Business Day prior to the first day of such Interest
Period, select; provided, however, that:
(a) the Borrower may not select any Interest Period
that ends after the Termination Date or, if the Revolving Credit
Advances have been converted to a term loan pursuant to Section
2.06 prior to such selection, that ends after the Maturity
Date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Revolving
Credit Borrowing or for LIBO Rate Advances comprising part of
the same Competitive Bid Borrowing shall be of the same
duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided, however, that, if
such extension would cause the last day of such Interest Period
to occur in the next following calendar month, the last day of
such Interest Period shall occur on the next preceding Business
Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there is
no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Investment" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any capital stock,
warrants, rights, options, obligations or other securities or all or
substantially all of the assets of such Person, any capital
contribution to such Person or any other investment in such Person,
including, without limitation, any arrangement pursuant to which
the investor incurs Debt of the types referred to in clauses (h) and
(i) of the definition of "Debt" in respect of such Person.
"Lenders" means the Initial Lenders, each Assuming Lender that
shall become a party hereto pursuant to Section 2.18 and each Person
that shall become a party hereto pursuant to Section 8.07.
"LIBO Rate" means, for any Interest Period for all LIBO Rate
Advances comprising part of the same Competitive Bid Borrowing, an
interest rate per annum equal to the rate per annum obtained by dividing
(a) the rate per annum (rounded upward to the nearest whole multiple of
1/16 of 1% per annum) appearing on Telerate Markets Page 3750 (or any
successor page) as the London interbank offered rate for deposits in
U.S. dollars at approximately 11:00 A.M. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to
such Interest Period or, if for any reason such rate is not available,
the average (rounded upward to the nearest whole multiple of 1/16 of
1% per annum, if such average is not such a multiple) of the rate per
annum at which deposits in U.S. dollars offered by the principal office
of each of the Reference Banks in London, England to prime banks in the
London interbank market at 11:00 A.M. (London time) two Business Days
before the first day of such Interest Period in an amount substantially
equal to the amount that would be the Reference Banks' respective
ratable shares of such Borrowing if such Borrowing were to be a
Revolving Credit Borrowing to be outstanding during such Interest
Period and for a period equal to such Interest Period by (b) a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage
for such Interest Period. If the Telerate Markets Page 3750 (or any
successor page) is unavailable, the LIBO Rate for any Interest Period
for each LIBO Rate Advance comprising part of the same Competitive Bid
Borrowing shall be determined by the Agent on the basis of applicable
rates furnished to and received by the Agent from the Reference Banks
two Business Days before the first day of such Interest Period, subject,
however, to the provisions of Section 2.08.
"LIBO Rate Advance" means a Competitive Bid Advance bearing
interest based on the LIBO Rate.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of
a conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"Marketable Securities" means any of the following, to the
extent owned by the Borrower or any of its Subsidiaries free and
clear of all Liens and having a maturity of not greater than 360
days from the date of acquisition thereof: (a) readily marketable
direct obligations of the Government of the United States or any
agency or instrumentality thereof or obligations unconditionally
guaranteed by the full faith and credit of the Government of the
United States, (b) certificates of deposit of or time deposits
with any commercial bank that is a Lender or a member of the Federal
Reserve System, issues (or the parent of which issues) commercial
paper rated as described in clause (c), is organized or licensed under
the laws of the United States or any State thereof and has combined
capital and surplus of at least $1 billion, (c) commercial paper in an
aggregate amount of no more than $10,000,000 per issuer outstanding at
any time, issued by any corporation organized under the laws of any
State of the United States and rated at least "Prime-1" (or the then
equivalent grade) by Moody's, "A-1" (or the then equivalent grade) by
S&P or F-1 (or the then equivalent grade) by Fitch or (d) money market
mutual funds with a minimum of $500,000,000 net asset value rated at
least Aaa by Moody's, AAA by S&P or AAA by Fitch.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower or the Borrower
and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a)
the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower or the Borrower
and its Subsidiaries taken as a whole, (b) the rights and remedies of
the Agent or any Lender under this Agreement or any Note or (c) the
ability of the Borrower to perform its obligations under this Agreement
or any Note.
"Maturity Date" means the earlier of (a) the first anniversary
of the Termination Date and (b) the date of termination in whole of
the aggregate Commitments pursuant to Section 2.04 or 6.01.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of the Borrower or any ERISA Affiliate and at least one
Person other than the Borrower and the ERISA Affiliates or (b) was so
maintained and in respect of which the Borrower or any ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.
"Non-Consenting Lender" has the meaning specified in
Section 2.18(b).
"Note" means a Revolving Credit Note or a Competitive Bid Note.
"Notice of Competitive Bid Borrowing" has the meaning specified
in Section 2.03(a).
"Notice of Revolving Credit Borrowing" has the meaning specified
in Section 2.02(a).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b) hereof; (b) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's
Liens and other similar Liens arising in the ordinary course of business
securing obligations that are not overdue for a period of more than 90
days; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations; and (d) easements, rights of way and other
encumbrances on title to real property that do not render title to the
property encumbered thereby unmarketable or materially adversely
affect the use of such property for its present purposes.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust, unincorporated
association, joint venture, limited liability company or other
entity, or a government or any political subdivision or agency
thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pretax Net Income" means, for any period, net income (or loss)
before taxes of the Borrower and its Subsidiaries, on a Consolidated
basis for such period taken as a single accounting period, excluding,
however, net income (or loss) attributable to any Person (other
than the Borrower or any of its Subsidiaries) in which the Borrower
or any of its Subsidiaries has a minority interest, except to the
extent of the amount of cash dividends or other cash distributions
actually paid to the Borrower or such Subsidiary by such other
Person.
"Pro Rata Share" of any amount means, with respect to any Lender
at any time, the product of such amount times a fraction the numerator
of which is the amount of such Lender's Commitment at such time (or, if
the Commitments shall have been terminated pursuant to Section 2.05
or 6.01, such Lender's Commitment as in effect immediately prior to such
termination) and the denominator of which is the aggregate amount of
all Commitments at such time (or, if the Commitments shall have been
terminated pursuant to Section 2.05 or 6.01, the aggregate
amount of all Commitments as in effect immediately prior to such
termination).
"Public Debt Rating" means, as of any date, the rating
that has been most recently announced by either S&P, Moody's or Fitch,
as the case may be, for any class of non-credit enhanced long-term
senior unsecured debt issued by the Borrower or, if any such rating
agency shall have issued more than one such rating, the lowest such
rating issued by such rating agency. For purposes of the foregoing,
(a) if only one of S&P, Moody's or Fitch shall have in effect a
Public Debt Rating, the Applicable Margin, the Applicable Percentage
and the Applicable Utilization Fee shall be determined by reference
to the available rating; (b) if none of S&P, Moody's or Fitch shall
have in effect a Public Debt Rating, the Applicable Margin, the
Applicable Percentage and the Applicable Utilization Fee will be set
in accordance with Level 5 under the definition of "Applicable Margin",
"Applicable Percentage" or "Applicable Utilization Fee", as the case may
be; (c) if only two of S&P, Moody's or Fitch shall have in effect a
Public Debt Rating, the Applicable Margin, the Applicable Percentage
and the Applicable Utilization Fee shall be determined by reference to
the higher rating unless such ratings differ by two or more levels, in
which case the applicable level will be deemed to be one level below the
higher of such levels, (d) if the ratings established by S&P, Moody's
and Fitch shall fall within different levels, and two of the three
are within the same level, the Applicable Margin, the Applicable
Percentage and the Applicable Utilization Fee shall be based upon
the rating of those two such agencies and the ratings of no two
agencies fall within the same level, the rating of the agency that is
neither the highest nor the lowest shall apply and the Applicable,
Margin, the Applicable Percentage and the Applicable Utilization Fee
shall be based upon the rating of that agency; (e) if any rating
established by S&P, Moody's or Fitch shall be changed, such change
shall be effective as of the date on which such change is first
announced publicly by the rating agency making such change; and (f)
if S&P, Moody's or Fitch shall change the basis on which ratings are
established, each reference to the Public Debt Rating announced by S&P,
Moody's or Fitch, as the case may be, shall refer to the then equivalent
rating by S&P, Moody's or Fitch, as the case may be.
"Rating Level" means, as of any date of determination, the
numerically lowest level set forth below as then in effect, as
determined in accordance with the following provisions of this
definition:
Level 1 The Public Debt Rating is A, A2 or A or better by two of
S&P, Moody's and Fitch, respectively;
Level 2 The Public Debt Rating is A-, A3 or A- by two of S&P,
Moody's and Fitch, respectively;
Level 3 The Public Debt Rating is BBB+, Baa1 or BBB+ by two of
S&P, Moody's and Fitch, respectively;
Level 4 The Public Debt Rating is BBB, Baa2 or BBB by two of
S&P, Moody's and Fitch, respectively;
Level 5 The Public Debt Rating is lower than Level 4.
"Reference Banks" means Citibank, Bank of America, N.A. and
Fleet National Bank.
"Register" has the meaning specified in Section 8.07(d).
"Required Lenders" means at any time Lenders owed at least a
majority in interest of the then aggregate unpaid principal amount
of the Revolving Credit Advances owing to Lenders, or, if no such
principal amount is then outstanding, Lenders having at least a majority
in interest of the Commitments.
"Revolving Credit Advance" means an advance by a Lender to the
Borrower as part of a Revolving Credit Borrowing and refers to a Base
Rate Advance or a Eurodollar Rate Advance (each of which shall be a
"Type" of Revolving Credit Advance).
"Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by each of
the Lenders pursuant to Section 2.01.
"Revolving Credit Note" means a promissory note of the Borrower
payable to the order of any Lender, delivered pursuant to a request made
under Section 2.16 in substantially the form of Exhibit A-1 hereto,
evidencing the aggregate indebtedness of the Borrower to such Lender
resulting from the Revolving Credit Advances made by such Lender.
"S&P" means Standard & Poor's Ratings Service, a division of The
McGraw-Hill Companies, Inc.
"Single Employer Plan" means a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of
the Borrower or any ERISA Affiliate and no Person other than the
Borrower and the ERISA Affiliates or (b) was so maintained and in
respect of which the Borrower or any ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been or
were to be terminated.
"Subsidiary" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall or
might have voting power upon the occurrence of any contingency),
(b) the interest in the capital or profits of such limited liability
company, partnership or joint venture or (c) the beneficial interest
in such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"Term Loan Conversion Date" means the Termination Date on which
all Revolving Credit Advances outstanding on such date are converted
into a term loan pursuant to Section 2.06.
"Term Loan Election" has the meaning specified in Section 2.06.
"Termination Date" means the earlier of (a) June 18, 2003,
subject to the extension thereof pursuant to Section 2.18 and (b) the
date of termination in whole of the Commitments pursuant to Section 2.05
or 6.01; provided, however, that the Termination Date of any Lender that
is a Non-Consenting Lender to any requested extension pursuant to
Section 2.18 shall be the Termination Date in effect immediately prior
to the applicable Extension Date for all purposes of this Agreement.
"Unused Commitment" means, with respect to each Lender at any
time, (a) such Lender's Commitment at such time minus (b) the sum of
(i) the aggregate principal amount of all Revolving Credit Advances made
by such Lender (in its capacity as a Lender) and outstanding at such
time, plus (ii) such Lender's Pro Rata Share of the aggregate principal
amount of Competitive Bid Advances then outstanding.
"Usage" means, at any time the sum of the aggregate principal
amount of the Advances then outstanding.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening
of such a contingency.
SECTION 1.02. Computation of Time Periods. In this Agreement
in the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each mean "to but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(e) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Revolving Credit Advances . Each Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
Revolving Credit Advances to the Borrower from time to time on any Business Day
during the period from the Effective Date until the Termination Date in an
aggregate amount not to exceed at any time such Lender's Unused Commitment at
such time. Each Revolving Credit Borrowing shall be in an aggregate amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof and shall
consist of Revolving Credit Advances of the same Type made on the same day by
the Lenders ratably according to their respective Commitments. Within the limits
of each Lender's Commitment, the Borrower may borrow under this Section 2.01,
prepay pursuant to Section 2.10 and reborrow under this Section 2.01.
SECTION 2.02. Making the Revolving Credit Advances. (a) Each
Revolving Credit Borrowing shall be made on notice, given not later than (x)
12:00 noon (New York City time) on the third Business Day prior to the date of
the proposed Revolving Credit Borrowing in the case of a Revolving Credit
Borrowing consisting of Eurodollar Rate Advances or (y) 12:00 noon (New York
City time) on the date of the proposed Revolving Credit Borrowing in the case of
a Revolving Credit Borrowing consisting of Base Rate Advances, by the Borrower
to the Agent, which shall give to each Lender prompt notice thereof by
telecopier or telex. Each such notice of a Revolving Credit Borrowing (a "Notice
of Revolving Credit Borrowing") shall be by telephone, confirmed immediately in
writing, or telecopier or telex in substantially the form of Exhibit B-1 hereto,
specifying therein the requested (i) date of such Revolving Credit Borrowing,
(ii) Type of Advances comprising such Revolving Credit Borrowing, (iii)
aggregate amount of such Revolving Credit Borrowing, and (iv) in the case of a
Revolving Credit Borrowing consisting of Eurodollar Rate Advances, initial
Interest Period for each such Revolving Credit Advance. Each Lender shall,
before 1:00 P.M. (New York City time) on the date of such Revolving Credit
Borrowing make available for the account of its Applicable Lending Office to the
Agent at the Agent's Account, in same day funds, such Lender's ratable portion
of such Revolving Credit Borrowing. After the Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in Article III, the
Agent will make such funds available to the Borrower at the Agent's address
referred to in Section 8.02.
(b) Anything in subsection (a) above to the contrary
notwithstanding, the Borrower may not select Eurodollar Rate Advances for any
Revolving Credit Borrowing if the aggregate amount of such Revolving Credit
Borrowing is less than $5,000,000 or if the obligation of the Lenders to make
Eurodollar Rate Advances shall then be suspended pursuant to Section 2.08 or
2.12.
(c) Each Notice of Revolving Credit Borrowing shall be
irrevocable and binding on the Borrower. In the case of any Revolving Credit
Borrowing that the related Notice of Revolving Credit Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Revolving Credit Borrowing for such Revolving Credit Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Revolving Credit
Advance to be made by such Lender as part of such Revolving Credit Borrowing
when such Revolving Credit Advance, as a result of such failure, is not made on
such date. The loss of a Lender shall include an amount equal to the excess, if
any, as reasonably determined by such Lender of (A) its cost of obtaining funds
for the Revolving Credit Advance not borrowed, to the last day of the Interest
Period for such Revolving Credit Advance which would have commenced on the date
of such failure to borrow over (B) the amount of interest (as reasonably
determined by such Lender) that could be realized by such Lender in reemploying
during such period the funds not borrowed.
(d) Unless the Agent shall have received notice from a
Lender prior to the time of any Revolving Credit Borrowing that such Lender
will not make available to the Agent such Lender's ratable portion of such
Revolving Credit Borrowing, the Agent may assume that such Lender has made
such portion available to the Agent on the date of such Revolving Credit
Borrowing in accordance with subsection (a) of this Section 2.02 and the
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
Lender shall not have so made such ratable portion available to the Agent,
such Lender and the Borrower severally agree to repay to the 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 Agent, at (i) in the case of the Borrower,
the interest rate applicable at the time to Revolving Credit Advances comprising
such Revolving Credit Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. If such Lender shall repay to the Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
Revolving Credit Advance as part of such Revolving Credit Borrowing for
purposes of this Agreement.
(e) The failure of any Lender to make the Revolving Credit
Advance to be made by it as part of any Revolving Credit Borrowing shall not
relieve any other Lender of its obligation hereunder to make its Revolving
Credit Advance on the date of such Revolving Credit Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Revolving
Credit Advance to be made by such other Lender on the date of any Revolving
Credit Borrowing.
SECTION 2.03. The Competitive Bid Advances. (a) Each Lender
severally agrees that the Borrower may make Competitive Bid Borrowings under
this Section 2.03 from time to time on any Business Day during the period from
the date hereof until the date occurring 30 days prior to the Termination Date
in the manner set forth below; provided that, following the making of each
Competitive Bid Borrowing, the Usage shall not exceed the aggregate amount of
the Commitments of the Lenders.
(i) The Borrower may request a Competitive Bid Borrowing
under this Section 2.03 by delivering to the Agent, by telecopier or
telex, a notice of a Competitive Bid Borrowing (a "Notice of Competitive
Bid Borrowing"), in substantially the form of Exhibit B-2 hereto,
specifying therein the requested (v) date of such proposed Competitive
Bid Borrowing, (w) aggregate amount of such proposed Competitive Bid
Borrowing, (x) in the case of a Competitive Bid Borrowing consisting of
LIBO Rate Advances, Interest Period, or in the case of a Competitive
Bid Borrowing consisting of Fixed Rate Advances, maturity date for
repayment of each Fixed Rate Advance to be made as part of such
Competitive Bid Borrowing (which maturity date may not be earlier than
the date occurring 7 days after the date of such Competitive Bid
Borrowing or later than the earlier of (I) 180 days after the date of
such Competitive Bid Borrowing and (II) the Termination Date), (y)
interest payment date or dates relating thereto, and (z) other terms
(if any) to be applicable to such Competitive Bid Borrowing, not later
than 11:00 A.M. (New York City time) (A) at least one Business Day
prior to the date of the proposed Competitive Bid Borrowing, if the
Borrower shall specify in the Notice of Competitive Bid Borrowing that
the rates of interest to be offered by the Lenders shall be fixed rates
per annum (the Advances comprising any such Competitive Bid Borrowing
being referred to herein as "Fixed Rate Advances") and (B) at least
four Business Days prior to the date of the proposed Competitive Bid
Borrowing, if the Borrower shall instead specify in the Notice of
Competitive Bid Borrowing that the Advances comprising such Competitive
Bid Borrowing shall be LIBO Rate Advances. Each Notice of Competitive
Bid Borrowing shall be irrevocable and binding on the Borrower. The
Agent shall in turn promptly notify each Lender of each request for a
Competitive Bid Borrowing received by it from the Borrower by sending
such Lender a copy of the related Notice of Competitive Bid Borrowing.
(ii) Each Lender may, if, in its sole discretion, it elects
to do so, irrevocably offer to make one or more Competitive Bid Advances
to the Borrower as part of such proposed Competitive Bid Borrowing at a
rate or rates of interest specified by such Lender in its sole
discretion, by notifying the Agent (which shall give prompt notice
thereof to the Borrower), (A) before 10:30 A.M. (New York City time) on
the date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of Fixed Rate Advances and (B)
before 11:00 A.M. (New York City time) three Business Days before the
date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of LIBO Rate Advances, of the
minimum amount and maximum amount of each Competitive Bid Advance which
such Lender would be willing to make as part of such proposed
Competitive Bid Borrowing (which amounts may, subject to the proviso to
the first sentence of this Section 2.03(a), exceed such Lender's
Commitment), the rate or rates of interest therefor and such Lender's
Applicable Lending Office with respect to such Competitive Bid Advance;
provided that if the Agent in its capacity as a Lender shall, in its
sole discretion, elect to make any such offer, it shall notify the
Borrower of such offer at least 30 minutes before the time and on the
date on which notice of such election is to be given to the Agent, by
the other Lenders. If any Lender shall elect not to make such an offer,
such Lender shall so notify the Agent before 11:00 A.M. (New York City
time) on the date on which notice of such election is to be given to
the Agent by the other Lenders, and such Lender shall not be obligated
to, and shall not, make any Competitive Bid Advance as part of such
Competitive Bid Borrowing; provided that the failure by any Lender to
give such notice shall not cause such Lender to be obligated to make
any Competitive Bid Advance as part of such proposed Competitive Bid
Borrowing.
(iii) The Borrower shall, in turn, (A) before 11:30 A.M. (New
York City time) on the date of such proposed Competitive Bid Borrowing,
in the case of a Competitive Bid Borrowing consisting of Fixed Rate
Advances and (B) before 12:00 noon (New York City time) three Business
Days before the date of such proposed Competitive Bid Borrowing, in the
case of a Competitive Bid Borrowing consisting of LIBO Rate Advances,
either:
(x) cancel such Competitive Bid Borrowing by giving
the Agent notice to that effect, or
(y) accept one or more of the offers made by any
Lender or Lenders pursuant to paragraph (ii) above, in its
sole discretion, by giving notice to the Agent of the amount
of each Competitive Bid Advance (which amount shall be equal
to or greater than the minimum amount, and equal to or less
than the maximum amount, notified to the Borrower by the Agent
on behalf of such Lender for such Competitive Bid Advance
pursuant to paragraph (ii) above) to be made by each Lender as
part of such Competitive Bid Borrowing, and reject any
remaining offers made by Lenders pursuant to paragraph (ii)
above by giving the Agent notice to that effect. The Borrower
shall accept the offers made by any Lender or Lenders to make
Competitive Bid Advances in order of the lowest to the highest
rates of interest offered by such Lenders. If two or more
Lenders have offered the same interest rate, the amount to be
borrowed at such interest rate will be allocated among such
Lenders in proportion to the amount that each such Lender
offered at such interest rate.
(iv) If the Borrower notifies the Agent that such Competitive
Bid Borrowing is cancelled pursuant to paragraph (iii)(x) above, the
Agent shall give prompt notice thereof to the Lenders and such
Competitive Bid Borrowing shall not be made.
(v) If the Borrower accepts one or more of the offers made
by any Lender or Lenders pursuant to paragraph (iii)(y) above, the Agent
shall in turn promptly notify (A) each Lender that has made an offer as
described in paragraph (ii) above, of the date and aggregate amount of
such Competitive Bid Borrowing and whether or not any offer or offers
made by such Lender pursuant to paragraph (ii) above have been accepted
by the Borrower, (B) each Lender that is to make a Competitive Bid
Advance as part of such Competitive Bid Borrowing, of the amount of
each Competitive Bid Advance to be made by such Lender as part of such
Competitive Bid Borrowing, and (C) each Lender that is to make a
Competitive Bid Advance as part of such Competitive Bid Borrowing, upon
receipt, that the Agent has received forms of documents appearing to
fulfill the applicable conditions set forth in Article III. Each Lender
that is to make a Competitive Bid Advance as part of such Competitive
Bid Borrowing shall, before 1:00 P.M. (New York City time) on the date
of such Competitive Bid Borrowing specified in the notice received from
the Agent pursuant to clause (A) of the preceding sentence or any later
time when such Lender shall have received notice from the Agent
pursuant to clause (C) of the preceding sentence, make available for
the account of its Applicable Lending Office to the Agent at the
Agent's Account, in same day funds, such Lender's portion of such
Competitive Bid Borrowing. Upon fulfillment of the applicable
conditions set forth in Article III and after receipt by the Agent of
such funds, the Agent will make such funds available to the Borrower at
the Agent's address referred to in Section 8.02. Promptly after each
Competitive Bid Borrowing the Agent will notify each Lender of the
amount of the Competitive Bid Borrowing and the dates upon which such
Competitive Bid Borrowing commenced and will terminate.
(vi) If the Borrower notifies the Agent that it accepts one
or more of the offers made by any Lender or Lenders pursuant to
paragraph (iii)(y) above, such notice of acceptance shall be irrevocable
and binding on the Borrower. The Borrower shall indemnify each Lender
against any loss, cost or expense incurred by such Lender as a result
of any failure to fulfill on or before the date specified in the
related Notice of Competitive Bid Borrowing for such Competitive Bid
Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Competitive Bid Advance to be made
by such Lender as part of such Competitive Bid Borrowing when such
Competitive Bid Advance, as a result of such failure, is not made on
such date. The loss of a Lender shall include an amount equal to the
excess, if any, as reasonably determined by such Lender of (A) its cost
of obtaining funds for the Competitive Bid Advance not borrowed, to the
last day of the Interest Period for such Competitive Bid Advance which
would have commenced on the date of such failure to borrow over (B) the
amount of interest (as reasonably determined by such Lender) that could
be realized by such Lender in reemploying during such period the funds
not borrowed.
(b) Each Competitive Bid Borrowing shall be in an aggregate
amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof
and, following the making of each Competitive Bid Borrowing, the Borrower shall
be in compliance with the limitation set forth in the proviso to the first
sentence of subsection (a) above.
(c) Within the limits and on the conditions set forth in
this Section 2.03, the Borrower may from time to time borrow under this Section
2.03, repay or prepay pursuant to subsection (d) below, and reborrow under this
Section 2.03, provided that a Competitive Bid Borrowing shall not be made within
three Business Days of the date of any other Competitive Bid Borrowing.
(d) The Borrower shall repay to the Agent for the account of
each Lender that has made a Competitive Bid Advance, on the maturity date of
each Competitive Bid Advance (such maturity date being that specified by the
Borrower for repayment of such Competitive Bid Advance in the related Notice of
Competitive Bid Borrowing delivered pursuant to subsection (a)(i) above and
provided in the Competitive Bid Note evidencing such Competitive Bid Advance),
the then unpaid principal amount of such Competitive Bid Advance. The Borrower
shall have no right to prepay any principal amount of any Competitive Bid
Advance unless, and then only on the terms, specified by the Borrower for such
Competitive Bid Advance in the related Notice of Competitive Bid Borrowing
delivered pursuant to subsection (a)(i) above and set forth in the Competitive
Bid Note evidencing such Competitive Bid Advance.
(e) The Borrower shall pay interest on the unpaid principal
amount of each Competitive Bid Advance from the date of such Competitive Bid
Advance to the date the principal amount of such Competitive Bid Advance is
repaid in full, at the rate of interest for such Competitive Bid Advance
specified by the Lender making such Competitive Bid Advance in its notice with
respect thereto delivered pursuant to subsection (a)(ii) above, payable on the
interest payment date or dates specified by the Borrower for such Competitive
Bid Advance in the related Notice of Competitive Bid Borrowing delivered
pursuant to subsection (a)(i) above, as provided in the Competitive Bid Note
evidencing such Competitive Bid Advance. Upon the occurrence and during the
continuance of an Event of Default under Section 6.01(a), the Borrower shall pay
interest on the amount of unpaid principal of and interest on each Competitive
Bid Advance owing to a Lender, payable in arrears on the date or dates interest
is payable thereon, at a rate per annum equal at all times to 2% per annum above
the rate per annum required to be paid on such Competitive Bid Advance under the
terms of the Competitive Bid Note evidencing such Competitive Bid Advance unless
otherwise agreed in such Competitive Bid Note.
(f) The indebtedness of the Borrower resulting from each
Competitive Bid Advance made to the Borrower as part of a Competitive Bid
Borrowing shall be evidenced by a separate Competitive Bid Note of the Borrower
payable to the order of the Lender making such Competitive Bid Advance.
SECTION 2.04. Fees. (a) Facility Fee. The Borrower agrees
to pay to the Agent for the account of each Lender a facility fee on the
aggregate amount of such Lender's Commitment from the date hereof in the case of
each Initial Lender and from the effective date specified in the Assumption
Agreement or in the Assignment and Acceptance pursuant to which it became a
Lender in the case of each other Lender until the Termination Date at a rate per
annum equal to the Applicable Percentage in effect from time to time, payable in
arrears quarterly on the last day of each March, June, September and December,
commencing June 30, 2002, and on the Termination Date.
(b) Agent's Fees. The Borrower shall pay to the Agent
for its own account such fees as may from time to time be agreed between the
Borrower and the Agent.
SECTION 2.05. Termination or Reduction of the Commitments. (a)
Optional The Borrower shall have the right, upon at least three Business Days'
notice to the Agent, to terminate in whole or permanently reduce ratably in part
the Unused Commitments of the Lenders, provided that each partial reduction
shall be in the aggregate amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof.
(b) Mandatory. On the Termination Date, if the Borrower has
made the Term Loan Election in accordance with Section 2.06 prior to
such date, and from time to time thereafter upon each prepayment of the
Revolving Credit Advances, the Commitments of the Lenders shall be
automatically and permanently reduced on a pro rata basis by an amount
equal to the amount by which (i) the aggregate Commitments immediately
prior to such reduction exceeds (ii) the aggregate unpaid principal
amount of all Revolving Credit Advances outstanding at such time.
SECTION 2.06. Repayment of Revolving Credit Advances. The
Borrower shall, subject to the next succeeding sentence, repay to the Agent for
the ratable account of the Lenders on the Termination Date the aggregate
principal amount of the Revolving Credit Advances then outstanding. The Borrower
may, upon not less than 15 days' notice to the Agent, elect (the "Term Loan
Election") to convert all of the Revolving Credit Advances outstanding on the
Termination Date in effect at such time into a term loan which the Borrower
shall repay in full ratably to the Lenders on the Maturity Date; provided that
the Term Loan Election may not be exercised if a Default has occurred and is
continuing on the date of notice of the Term Loan Election or on the date on
which the Term Loan Election is to be effected. All Revolving Credit Advances
converted into a term loan pursuant to this Section 2.06 shall continue to
constitute Revolving Credit Advances except that the Borrower may not reborrow
pursuant to Section 2.01 after all or any portion of such Revolving Credit
Advances have been prepaid pursuant to Section 2.09.
SECTION 2.07. Interest on Revolving Credit Advances. (a)
Scheduled Interest. The Borrower shall pay interest on the unpaid principal
amount of each Revolving Credit Advance owing to each Lender from the date of
such Revolving Credit Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. During such periods as such
Revolving Credit Advance is a Base Rate Advance, a rate per annum equal
at all times to the sum of (x) the Base Rate in effect from time to time
plus (y) the Applicable Margin in effect from time to time plus (z) the
Applicable Utilization Fee in effect from time to time, payable in
arrears quarterly on the last day of each March, June, September and
December during such periods and on the date such Base Rate Advance
shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Revolving Credit Advance is a Eurodollar Rate Advance, a rate per annum
equal at all times during each Interest Period for such Revolving
Credit Advance to the sum of (x) the Eurodollar Rate for such Interest
Period for such Revolving Credit Advance plus (y) the Applicable Margin
in effect from time to time plus (z) the Applicable Utilization Fee in
effect from time to time, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more
than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) Default Interest. Upon the occurrence and during the
continuance of an Event of Default under Section 6.01(a), the Agent may, and
upon the request of the Required Lenders shall, require the Borrower to pay
interest ("Default Interest") on (i) the unpaid principal amount of each
Revolving Credit Advance owing to each Lender, payable in arrears on the dates
referred to in clause (a)(i) or (a)(ii) above, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid on such
Revolving Credit Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to
the fullest extent permitted by law, the amount of any interest, fee or other
amount payable hereunder that is not paid when due, from the date such amount
shall be due until such amount shall be paid in full, payable in arrears on the
date such amount shall be paid in full and on demand, at a rate per annum equal
at all times to 2% per annum above the rate per annum required to be paid on
Base Rate Advances pursuant to clause (a)(i) above, provided, however, that
following acceleration of the Advances pursuant to Section 6.01, Default
Interest shall accrue and be payable hereunder whether or not previously
required by the Agent.
SECTION 2.08. Interest Rate Determination. (a) Each Reference
Bank agrees to furnish to the Agent timely information for the purpose of
determining each Eurodollar Rate and each LIBO Rate. If any one or more of the
Reference Banks shall not furnish such timely information to the Agent for the
purpose of determining any such interest rate, the Agent shall determine such
interest rate on the basis of timely information furnished by the remaining
Reference Banks. The Agent shall give prompt notice to the Borrower and the
Lenders of the applicable interest rate determined by the Agent for purposes of
Section 2.07(a)(i) or (ii), and the rate, if any, furnished by each Reference
Bank for the purpose of determining the interest rate under Section 2.07(a)(ii).
(b) If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Agent that the Eurodollar Rate for any Interest
Period for such Advances will not adequately reflect the cost to such Required
Lenders of making, funding or maintaining their respective Eurodollar Rate
Advances for such Interest Period, the Agent shall forthwith so notify the
Borrower and the Lenders, whereupon (i) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance, and (ii) the obligation of the Lenders to
make, or to Convert Revolving Credit Advances into, Eurodollar Rate Advances
shall be suspended until the Agent shall notify the Borrower and the Lenders
that the circumstances causing such suspension no longer exist.
(c) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Agent will forthwith so notify the Borrower and the Lenders and such Advances
will automatically, on the last day of the then existing Interest Period
therefor, have a subsequent Interest Period of one month.
(d) Upon the occurrence and during the continuance of any
Event of Default, (i) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (ii) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
(e) If Telerate Markets Page 3750 is unavailable and fewer
than two Reference Banks furnish timely information to the Agent for determining
the Eurodollar Rate or LIBO Rate for any Eurodollar Rate Advances or LIBO Rate
Advances, as the case may be,
(i) the Agent shall forthwith notify the Borrower and the
Lenders that the interest rate cannot be determined for such Eurodollar
Rate Advances or LIBO Rate Advances, as the case may be,
(ii) with respect to Eurodollar Rate Advances, each such
Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance (or if such
Advance is then a Base Rate Advance, will continue as a Base Rate
Advance), and
(iii) the obligation of the Lenders to make Eurodollar Rate
Advances or LIBO Rate Advances or to Convert Revolving Credit Advances
into Eurodollar Rate Advances shall be suspended until the Agent shall
notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
SECTION 2.09. Optional Conversion of Revolving Credit
Advances. The Borrower may on any Business Day, upon notice given to the Agent
not later than 12:00 noon (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of Sections
2.08 and 2.12, Convert all Revolving Credit Advances of one Type comprising the
same Borrowing into Revolving Credit Advances of the other Type; provided,
however, that any Conversion of Eurodollar Rate Advances into Base Rate Advances
shall be made only on the last day of an Interest Period for such Eurodollar
Rate Advances and any Conversion of Base Rate Advances into Eurodollar Rate
Advances shall be in an amount not less than the minimum amount specified in
Section 2.02(b). Each such notice of a Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Revolving
Credit Advances to be Converted, and (iii) if such Conversion is into Eurodollar
Rate Advances, the duration of the initial Interest Period for each such
Advance. Each notice of Conversion shall be irrevocable and binding on the
Borrower.
SECTION 2.10. Prepayments of Revolving Credit Advances. The
Borrower may, upon notice at least two Business Days' prior to the date of such
prepayment, in the case of Eurodollar Rate Advances, and not later than 12:00
noon (New York City time) on the date of such prepayment, in the case of Base
Rate Advances, to the Agent stating the proposed date and aggregate principal
amount of the prepayment, and if such notice is given the Borrower shall, prepay
the outstanding principal amount of the Revolving Credit Advances comprising
part of the same Revolving Credit Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof and (y) in the event of any such prepayment of a
Eurodollar Rate Advance, the Borrower shall be obligated to reimburse the
Lenders in respect thereof pursuant to Section 8.04(c).
SECTION 2.11. Increased Costs. (a) If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender of agreeing to make or
making, funding or maintaining Eurodollar Rate Advances or LIBO Rate Advances
(excluding for purposes of this Section 2.11 any such increased costs resulting
from (i) Taxes or Other Taxes (as to which Section 2.14 shall govern) and (ii)
changes in the basis of taxation of overall net income or overall gross income
by the United States or by the foreign jurisdiction or state under the laws of
which such Lender is organized or has its Applicable Lending Office or any
political subdivision thereof), then the Borrower shall from time to time, upon
demand by such Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such Lender additional amounts sufficient to compensate
such Lender for such increased cost. A certificate as to the amount of such
increased cost, submitted to the Borrower and the Agent by such Lender, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If any Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and that the amount of such
capital is increased by or based upon the existence of such Lender's commitment
to lend hereunder and other commitments of this type, then, upon demand by such
Lender (with a copy of such demand to the Agent), the Borrower shall pay to the
Agent for the account of such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender's commitment to lend hereunder. A certificate as to such amounts
submitted to the Borrower and the Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 2.12. Illegality. Notwithstanding any other provision
of this Agreement, if any Lender shall notify the Agent that the introduction of
or any change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority asserts that it is
unlawful, for any Lender or its Eurodollar Lending Office to perform its
obligations hereunder to make Eurodollar Rate Advances or LIBO Rate Advances or
to fund or maintain Eurodollar Rate Advances or LIBO Rate Advances hereunder,
(a) each Eurodollar Rate Advance or LIBO Rate Advance, as the case may be, will
automatically, upon such demand, Convert into a Base Rate Advance or an Advance
that bears interest at the rate set forth in Section 2.07(a)(i), as the case may
be, and (b) the obligation of the Lenders to make Eurodollar Rate Advances or
LIBO Rate Advances or to Convert Revolving Credit Advances into Eurodollar Rate
Advances shall be suspended until the Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist;
provided, however, that before making any such demand, each Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.13. Payments and Computations. (a) The Borrower
shall make each payment hereunder, irrespective of any right of counterclaim or
set-off, not later than 12:00 noon (New York City time) on the day when due in
U.S. dollars to the Agent at the Agent's Account in same day funds. The Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal or interest or facility fees ratably (other than amounts
payable pursuant to Section 2.03, 2.11, 2.14 or 8.04(c)) to the Lenders for the
account of their respective Applicable Lending Offices, and like funds relating
to the payment of any other amount payable to any Lender to such Lender for the
account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon any Assuming Lender becoming a
Lender hereunder as a result of an extension of the Termination Date pursuant to
Section 2.18, and upon the Agent's receipt of such Lender's Assumption Agreement
and recording of the information contained therein in the Register, from and
after the applicable Extension Date, the Agent shall make all payments hereunder
and under any Notes issued in connection therewith in respect of the interest
assumed thereby to the Assuming Lender. Upon its acceptance of an Assignment and
Acceptance and recording of the information contained therein in the Register
pursuant to Section 8.07(c), from and after the effective date specified in such
Assignment and Acceptance, the Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes each Lender, if and to
the extent payment owed to such Lender is not made by the Borrower to the Agent
when due hereunder or under the Note held by such Lender, to charge from time to
time against any or all of the Borrower's accounts with such Lender any amount
so due.
(c) All computations of interest based on clause (i) of the
definition of Base Rate shall be made by the Agent on the basis of a year of 365
or 366 days, as the case may be, and all computations of interest based on the
Eurodollar Rate, the LIBO Rate, the Federal Funds Rate or clause (ii) of the
definition of Base Rate or in respect of Fixed Rate Advances and of fees shall
be made by the Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or fees are payable. Each
determination by the Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall
be stated to be due on a day other than a Business Day, such payment shall be
made on the next succeeding Business Day, provided, however, that, if such
extension would cause payment of interest on or principal of Eurodollar Rate
Advances or LIBO Rate Advances to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day, and such
extension or decrease of time shall in such case be included in the computation
of payment of interest fee.
(e) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Agent may assume that
the Borrower has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such Lender. If
and to the extent the Borrower shall not have so made such payment in full to
the Agent, each Lender shall repay to the Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day from the
date such amount is distributed to such Lender until the date such Lender repays
such amount to the Agent, at the Federal Funds Rate.
SECTION 2.14. Taxes. (a) Any and all payments by the Borrower
to or for the account of any Lender or the Agent hereunder or under the Notes or
any other documents to be delivered hereunder shall be made, in accordance with
Section 2.13 or the applicable provisions of such other documents, 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, apart from Excluded Taxes. As used in this Section 2.14, "Excluded
Taxes" means with respect to each Lender and the Agent, (x) taxes imposed on its
overall net income, and franchise taxes imposed on it in lieu of net income
taxes, by the jurisdiction under the laws of which such Lender or the Agent (as
the case may be) is organized or any political subdivision thereof and, in the
case of each Lender, taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes, by the jurisdiction of such
Lender's Applicable Lending Office or any political subdivision thereof and (y)
taxes that are directly attributable to such Lender's failure to comply with the
provisions of Section 2.14(e), (f) and (g) (all such taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments
hereunder or under the Notes, other than Excluded Taxes, 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 or under any Note or any
other documents to be delivered hereunder to any Lender or the Agent, (i) the
sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.14) such Lender or the Agent (as the case may be) receives
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 taxation authority or other
authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies that arise from any payment made hereunder or under the Notes
or any other documents to be delivered hereunder or from the execution, delivery
or registration of, performing under, or otherwise with respect to, this
Agreement or the Notes or any other documents to be delivered hereunder
(hereinafter referred to as "Other Taxes").
(c) The Borrower shall indemnify each Lender and the Agent
for and hold it harmless against the full amount of Taxes or Other Taxes
(including, without limitation, taxes of any kind imposed or asserted by any
jurisdiction on amounts payable under this Section 2.14) imposed on or paid by
such Lender or the Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto.
This indemnification shall be made within 30 days from the date such Lender or
the Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes,
the Borrower shall furnish to the Agent, at its address referred to in Section
8.02, the original or a certified copy of a receipt evidencing such payment to
the extent such a receipt is issued therefor, or other written proof of payment
thereof that is reasonably satisfactory to the Agent. For purposes of this
subsection (d) and subsection (e), the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the Internal
Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Initial Lender and on the date of the
Assumption Agreement or the Assignment and Acceptance pursuant to which it
becomes a Lender in the case of each other Lender, and from time to time
thereafter as reasonably requested in writing by the Borrower (but only so long
as such Lender remains lawfully able to do so), shall provide each of the Agent
and the Borrower with two original Internal Revenue Service forms W-8BEN or
W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that such Lender is exempt from or entitled
to a reduced rate of United States withholding tax on payments pursuant to this
Agreement or the Notes. If the form provided by a Lender at the time such Lender
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered Excluded Taxes unless and until such Lender provides the appropriate
forms certifying that a lesser rate applies, whereupon withholding tax at such
lesser rate only shall be considered Excluded Taxes for periods governed by such
form; provided, however, that, if at the date of the Assignment and Acceptance
pursuant to which a Lender assignee becomes a party to this Agreement, the
Lender assignor was entitled to payments under subsection (a) in respect of
United States withholding tax with respect to interest paid at such date, then,
to such extent, the term Taxes shall include (in addition to withholding taxes
that may be imposed in the future or other amounts otherwise includable in
Taxes) United States withholding tax, if any, applicable with respect to the
Lender assignee on such date.
(f) For any period with respect to which a Lender has failed
to provide the Borrower with the appropriate form, certificate or other document
described in Section 2.14(e) (other than if such failure is due to a change in
law, or in the interpretation or application thereof, occurring subsequent to
the date on which a form, certificate or other document originally was required
to be provided, or if such form, certificate or other document otherwise is not
required under subsection (e) above), such Lender shall not be entitled to
indemnification under Section 2.14(a) or (c) with respect to Taxes imposed by
the United States by reason of such failure; provided, however, that should a
Lender become subject to Taxes because of its failure to deliver a form,
certificate or other document required hereunder, the Borrower, at the Lender's
expense, shall take such steps as the Lender shall reasonably request to assist
the Lender to recover such Taxes.
(g) Any Lender claiming any additional amounts payable
pursuant to this Section 2.14 agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to file any
certificate or document requested by the Borrower or to change the jurisdiction
of its Eurodollar Lending Office if the making of such a filing or change would
avoid the need for, or reduce the amount of, any such additional amounts that
may thereafter accrue and would not, in the reasonable judgment of such Lender,
be otherwise disadvantageous to such Lender.
(h) If any Lender determines, in its sole discretion, that
it has actually and finally realized, by reason of a refund, deduction or credit
of any Taxes paid or reimbursed by the Borrower pursuant to subjection (a) or
(c) above in respect of payments under the Credit Agreement or the Notes, a
current monetary benefit that it would otherwise not have obtained, and that
would result in the total payments under this Section 2.15 exceeding the amount
needed to make such Lender whole, such Lender shall pay to the Borrower, with
reasonable promptness following the date on which it actually realizes such
benefit, an amount equal to the lesser of the amount of such benefit or the
amount of such excess, in each case net of all out-of- pocket expenses in
securing such refund, deduction or credit. Nothing in this paragraph (h) shall
be construed to require the Agent, any Lender or any Issuing Bank to make
available its tax returns (or any other information relating to is taxes which
it deems confidential) to the Borrower or any other Person.
SECTION 2.15. Sharing of Payments, Etc. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Revolving Credit Advances
owing to it (other than pursuant to Section 2.11, 2.14 or 8.04(c)) in excess of
its ratable share of payments on account of the Revolving Credit Advances
obtained by all the Lenders, such Lender shall forthwith purchase from the other
Lenders such participations in the Revolving Credit Advances owing to them as
shall be necessary to cause such purchasing Lender to share the excess payment
ratably with each of them; provided, however, that if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and such Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (i) the amount of such Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 2.15 may, to the fullest extent permitted by
law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
SECTION 2.16. Evidence of Debt. (a) Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Revolving Credit
Advance owing to such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder in respect of Revolving Credit Advances. The Borrower agrees that upon
notice by any Lender to the Borrower (with a copy of such notice to the Agent)
to the effect that a Revolving Credit Note is required or appropriate in order
for such Lender to evidence (whether for purposes of pledge, enforcement or
otherwise) the Revolving Credit Advances owing to, or to be made by, such
Lender, the Borrower shall promptly execute and deliver to such Lender a
Revolving Credit Note payable to the order of such Lender in a principal amount
up to the Commitment of such Lender.
(b) The Register maintained by the Agent pursuant to Section
8.07(d) shall include a control account, and a subsidiary account for each
Lender, in which accounts (taken together) shall be recorded (i) the date and
amount of each Borrowing made hereunder, the Type of Advances comprising such
Borrowing and, if appropriate, the Interest Period applicable thereto, (ii) the
terms of each Assumption Agreement and each Assignment and Acceptance delivered
to and accepted by it, (iii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iv) the amount of any sum received by the Agent from the Borrower hereunder
and each Lender's share thereof.
(c) Entries made in good faith by the Agent in the Register
pursuant to subsection (b) above, and by each Lender in its account or accounts
pursuant to subsection (a) above, shall be prima facie evidence of the amount of
principal and interest due and payable or to become due and payable from the
Borrower to, in the case of the Register, each Lender and, in the case of such
account or accounts, such Lender, under this Agreement, absent manifest error;
provided, however, that the failure of the Agent or such Lender to make an
entry, or any finding that an entry is incorrect, in the Register or such
account or accounts shall not limit or otherwise affect the obligations of the
Borrower under this Agreement.
SECTION 2.17. Use of Proceeds. The proceeds of the Advances
shall be available (and the Borrower agrees that it shall use such proceeds)
solely for general corporate purposes (which shall include refunding of
commercial paper) of the Borrower and its Subsidiaries.
SECTION 2.18. Extension of Termination Date. (a) At least 45
days but not more than 60 days prior to the Termination Date, the Borrower, by
written notice to the Agent, may request an extension of the Termination Date in
effect at such time by 364 days from its then scheduled expiration; provided,
however, that the Borrower shall not have made the Term Loan Election for
Revolving Credit Advances outstanding on such Termination Date prior to such
time. The Agent shall promptly notify each Lender of such request, and each
Lender shall in turn, in its sole discretion, not later than 20 days prior to
the Termination Date, notify the Borrower and the Agent in writing as to whether
such Lender will consent to such extension. If any Lender shall fail to notify
the Agent and the Borrower in writing of its consent to any such request for
extension of the Termination Date at least 20 days prior to the Termination
Date, such Lender shall be deemed to be a Non-Consenting Lender with respect to
such request. The Agent shall notify the Borrower not later than 15 days prior
to the Termination Date of the decision of the Lenders regarding the Borrower's
request for an extension of the Termination Date.
(b) If all the Lenders consent in writing to any such
request in accordance with subsection (a) of this Section 2.18, the Termination
Date in effect at such time shall, effective as at the Termination Date (the
"Extension Date"), be extended for 364 days; provided that on each Extension
Date the applicable conditions set forth in Article III shall be satisfied. If
less than all of the Lenders consent in writing to any such request in
accordance with subsection (a) of this Section 2.18, the Termination Date in
effect at such time shall, effective as at the applicable Extension Date and
subject to subsection (d) of this Section 2.18, be extended as to those Lenders
that so consented (each a "Consenting Lender") but shall not be extended as to
any other Lender (each a "Non-Consenting Lender"). To the extent that the
Termination Date is not extended as to any Lender pursuant to this Section 2.18
and the Commitment of such Lender is not assumed in accordance with subsection
(c) of this Section 2.18 on or prior to the applicable Extension Date, the
Commitment of such Non-Consenting Lender shall automatically terminate in whole
on such unextended Termination Date without any further notice or other action
by the Borrower, such Lender or any other Person; provided that such
Non-Consenting Lender's rights under Sections 2.11, 2.14 and 8.04, and its
obligations under Section 7.05, shall survive the Termination Date for such
Lender as to matters occurring prior to such date. It is understood and agreed
that no Lender shall have any obligation whatsoever to agree to any request made
by the Borrower for any requested extension of the Termination Date.
(c) If less than all of the Lenders consent to any such
request pursuant to subsection (a) of this Section 2.18, the Agent shall
promptly so notify the Consenting Lenders, and each Consenting Lender may, in
its sole discretion, give written notice to the Agent not later than 10 days
prior to the Extension Date of the amount of the Non-Consenting Lenders'
Commitments for which it is willing to accept an assignment. If the Consenting
Lenders notify the Agent that they are willing to accept assignments of
Commitments in an aggregate amount that exceeds the amount of the Commitments of
the Non-Consenting Lenders, such Commitments shall be allocated among the
Consenting Lenders willing to accept such assignments in such amounts as are
agreed between the Borrower and the Agent. If after giving effect to the
assignments of Commitments described above there remains any Commitments of
Non-Consenting Lenders, the Borrower may arrange for one or more Consenting
Lenders or other Eligible Assignees (an "Assuming Lender") to assume, effective
as of the Extension Date, any Non-Consenting Lender's Commitment and all of the
obligations of such Non-Consenting Lender under this Agreement thereafter
arising, without recourse to or warranty by, or expense to, such Non-Consenting
Lender; provided, however, that the amount of the Commitment of any such
Assuming Lender as a result of such substitution shall in no event be less than
$10,000,000 unless the amount of the Commitment of such Non-Consenting Lender is
less than $1,000,000, in which case such Assuming Lender shall assume all of
such lesser amount; and provided further that:
(i) any such Consenting Lender or Assuming Lender shall have
paid to such Non-Consenting Lender (A) the aggregate principal amount
of, and any interest accrued and unpaid to the effective date of the
assignment on, the outstanding Advances, if any, of such Non-Consenting
Lender plus (B) any accrued but unpaid facility fees owing to such
Non-Consenting Lender as of the effective date of such assignment;
(ii) all additional costs, reimbursements, expense
reimbursements and indemnities payable to such Non-Consenting Lender,
and all other accrued and unpaid amounts owing to such Non-Consenting
Lender hereunder, as of the effective date of such assignment shall
have been paid to such Non-Consenting Lender; and
(iii) with respect to any such Assuming Lender, the applicable
processing and recordation fee required under Section 8.07(a) for such
assignment shall have been paid;
provided further that such Non-Consenting Lender's rights under Sections 2.11,
2.14 and 8.04, and its obligations under Section 7.05, shall survive such
substitution as to matters occurring prior to the date of substitution. At least
three Business Days prior to any Extension Date, (A) each such Assuming Lender,
if any, shall have delivered to the Borrower and the Agent an agreement (an
"Assumption Agreement") in form and substance satisfactory to the Borrower and
the Agent, duly executed by such Assuming Lender, such Non-Consenting Lender,
the Borrower and the Agent, (B) any such Consenting Lender shall have delivered
confirmation in writing satisfactory to the Borrower and the Agent as to the
increase in the amount of its Commitment and (C) each Non-Consenting Lender
being replaced pursuant to this Section 2.18 shall have delivered to the Agent
any Note or Notes held by such Non-Consenting Lender. Upon the payment or
prepayment of all amounts referred to in clauses (i), (ii) and (iii) of the
immediately preceding sentence, each such Consenting Lender or Assuming Lender,
as of the Extension Date, will be substituted for such Non-Consenting Lender
under this Agreement and shall be a Lender for all purposes of this Agreement,
without any further acknowledgment by or the consent of the other Lenders, and
the obligations of each such Non-Consenting Lender hereunder shall, by the
provisions hereof, be released and discharged.
(d) If (after giving effect to any assignments or
assumptions pursuant to subsection (c) of this Section 2.18) Lenders having
Commitments equal to at least 75% of the Commitments in effect immediately prior
to the Extension Date consent in writing to a requested extension (whether by
execution or delivery of an Assumption Agreement or otherwise) not later than
one Business Day prior to such Extension Date, the Agent shall so notify the
Borrower, and, subject to the satisfaction of the applicable conditions in
Article III, the Termination Date then in effect shall be extended for the
additional 364-day period as described in subsection (a) of this Section 2.18,
and all references in this Agreement and in the Notes, if any, to the
"Termination Date" shall, with respect to each Consenting Lender and each
Assuming Lender for such Extension Date, refer to the Termination Date as so
extended. Promptly following each Extension Date, the Agent shall notify the
Lenders (including, without limitation, each Assuming Lender) of the extension
of the scheduled Termination Date in effect immediately prior thereto and shall
thereupon record in the Register the relevant information with respect to each
such Consenting Lender and each such Assuming Lender.
ARTICLE III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. Conditions Precedent to Effectiveness of
Sections 2.01 and 2.03. Sections 2.01 and 2.03 of this Agreement shall become
effective on and as of the first date (the "Effective Date") on which the
following conditions precedent have been satisfied:
(a) There shall have occurred no Material Adverse Change
since December 31, 2001.
(b) There shall exist no action, suit, investigation,
litigation or proceeding affecting the Borrower or any of its
Subsidiaries pending or threatened before any court, governmental
agency or arbitrator that (i) could be reasonably likely to have a
Material Adverse Effect or (ii) purports to affect the legality,
validity or enforceability of this Agreement or any Note or the
consummation of the transactions contemplated hereby.
(c) Nothing shall have come to the attention of the Lenders
during the course of their due diligence investigation to lead them to
believe that the Information Memorandum was or has become misleading,
incorrect or incomplete in any material respect; without limiting the
generality of the foregoing, the Lenders shall have been given such
access to the management, records, books of account, contracts and
properties of the Borrower and its Subsidiaries as they shall have
requested.
(d) All governmental and third party consents and approvals
necessary in connection with the transactions contemplated hereby shall
have been obtained (without the imposition of any conditions that are
not acceptable to the Lenders) and shall remain in effect, and no law
or regulation shall be applicable in the reasonable judgment of the
Lenders that restrains, prevents or imposes materially adverse
conditions upon the transactions contemplated hereby.
(e) The Borrower shall have notified each Lender and the
Agent in writing as to the proposed Effective Date.
(f) The Borrower shall have paid all accrued fees and
expenses of the Agent and the Lenders (including the accrued fees and
expenses of counsel to the Agent) that have been billed to the Borrower.
(g) On the Effective Date, the following statements shall be
true and the Agent shall have received for the account of each Lender a
certificate signed by a duly authorized officer of the Borrower, dated
the Effective Date, stating that:
(i) The representations and warranties contained
in Section 4.01 are correct on and as of the
Effective Date, and
(ii) No event has occurred and is continuing that
constitutes a Default.
(h) The Agent shall have received on or before the Effective
Date the following, each dated such day, in form and substance
satisfactory to the Agent and (except for the Revolving Credit Notes)
in sufficient copies for each Lender:
(i) The Revolving Credit Notes to the order of
the Lenders to the extent requested by any Lender pursuant
to Section 2.16.
(ii) Certified copies of the resolutions of the Board
of Directors of the Borrower approving this Agreement and the
Notes, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with
respect to this Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant
Secretary of the Borrower certifying the names and true
signatures of the officers of the Borrower authorized to sign
this Agreement and the Notes and the other documents to be
delivered hereunder.
(iv) A favorable opinion of Mark C. Hill, Vice
President, Secretary and General Counsel of the Borrower,
substantially in the form of Exhibit D hereto and as to such
other matters as any Lender through the Agent may reasonably
request.
(v) A favorable opinion of Shearman &
Sterling, counsel for the Agent, in form and substance
satisfactory to the Agent.
(i) The termination of the commitments of the lenders and
the payment in full of all Debt outstanding under (i) the $300,000,000
Revolving Credit Agreement (Facility A) dated as of June 25, 1998 among
the Borrower, the lenders parties thereto and NationsBank, N.A, as
administrative agent, and (ii) $300,000,000 Revolving Credit Agreement
(Facility B) dated as of June 25, 1998 among the Borrower, the lenders
parties thereto and NationsBank, N.A, as administrative agent. By
execution of this Agreement, each of the Lenders that is a lender under
a credit agreement referred to in clause (i) or (ii) above hereby
waives any requirement set forth in such credit agreement of prior
notice to the termination of their commitments thereunder.
SECTION 3.02. Conditions Precedent to Each Revolving Credit
Borrowing and Extension Date. The obligation of each Lender to make a Revolving
Credit Advance on the occasion of each Revolving Credit Borrowing and each
extension of Commitments pursuant to Section 2.18 shall be subject to the
conditions precedent that the Effective Date shall have occurred and on the date
of such Revolving Credit Borrowing or the applicable Extension Date (a) the
following statements shall be true (and each of the giving of the applicable
Notice of Revolving Credit Borrowing request for Commitment Extension and the
acceptance by the Borrower of the proceeds of such Revolving Credit Borrowing
shall constitute a representation and warranty by the Borrower that on the date
of such Borrowing or such Extension Date such statements are true):
(i) the representations and warranties contained in Section
4.01 (except, in the case of Revolving Credit Borrowings, the
representation set forth in subsection (j) thereof) are correct on and
as of such date, before and after giving effect to such Revolving
Credit Borrowing or such Extension Date and to the application of the
proceeds therefrom, as though made on and as of such date, and
(ii) no event has occurred and is continuing, or would result
from such Revolving Credit Borrowing or such Extension Date or from the
application of the proceeds therefrom, that constitutes a Default;
and (b) the Agent shall have received such other approvals, opinions or
documents as any Lender through the Agent may reasonably request.
SECTION 3.03. Conditions Precedent to Each Competitive Bid
Borrowing. The obligation of each Lender that is to make a Competitive Bid
Advance on the occasion of a Competitive Bid Borrowing to make such Competitive
Bid Advance as part of such Competitive Bid Borrowing is subject to the
conditions precedent that (i) the Agent shall have received the written
confirmatory Notice of Competitive Bid Borrowing with respect thereto, (ii) on
or before the date of such Competitive Bid Borrowing, but prior to such
Competitive Bid Borrowing, the Agent shall have received a Competitive Bid Note
payable to the order of such Lender for each of the one or more Competitive Bid
Advances to be made by such Lender as part of such Competitive Bid Borrowing, in
a principal amount equal to the principal amount of the Competitive Bid Advance
to be evidenced thereby and otherwise on such terms as were agreed to for such
Competitive Bid Advance in accordance with Section 2.03, and (iii) on the date
of such Competitive Bid Borrowing the following statements shall be true (and
each of the giving of the applicable Notice of Competitive Bid Borrowing and the
acceptance by the Borrower of the proceeds of such Competitive Bid Borrowing
shall constitute a representation and warranty by the Borrower that on the date
of such Competitive Bid Borrowing such statements are true):
(a) the representations and warranties contained in Section
4.01(a) through (i) are correct on and as of the date of such
Competitive Bid Borrowing, before and after giving effect to such
Competitive Bid Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date,
(b) no event has occurred and is continuing, or would result
from such Competitive Bid Borrowing or from the application of the
proceeds therefrom, that constitutes a Default, and
(c) no event has occurred and no circumstance exists of
which the Borrower has become aware, as a result of which the
information concerning the Borrower that has been provided to the Agent
and each Lender by the Borrower in connection herewith is shown to
contain an untrue statement of a material fact or is shown to have
omitted to state any material fact or any fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading as if the date such information was
provided.
SECTION 3.04. Determinations Under Section 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by this Agreement
shall have received notice from such Lender prior to the date that the Borrower,
by notice to the Lenders, designates as the proposed Effective Date, specifying
its objection thereto. The Agent shall promptly notify the Lenders of the
occurrence of the Effective Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
The Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
(b) The execution, delivery and performance by the Borrower
of this Agreement and the Notes to be delivered by it, and the
consummation of the transactions contemplated hereby, are within the
Borrower's corporate powers, have been duly authorized by all necessary
corporate action, and do not contravene (i) the Borrower's charter or
by-laws or (ii) law or any contractual restriction binding on or
affecting the Borrower.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery
and performance by the Borrower of this Agreement or the Notes to be
delivered by it.
(d) This Agreement has been, and each of the Notes to be
delivered by it when delivered hereunder will have been, duly executed
and delivered by the Borrower. This Agreement is, and each of the Notes
when delivered hereunder will be, the legal, valid and binding
obligation of the Borrower enforceable against the Borrower in
accordance with their respective terms (subject, as to the enforcement
of remedies, to applicable bankruptcy, reorganization, moratorium and
similar laws affecting creditors rights generally).
(e) The Consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 2001, and the related Consolidated
statements of income and cash flows of the Borrower and its
Subsidiaries for the fiscal year then ended, accompanied by an opinion
of PricewaterhouseCoopers LLP, independent public accountants, and the
Consolidated balance sheet of the Borrower and its Subsidiaries as at
March 31, 2002, and the related Consolidated statements of income and
cash flows of the Borrower and its Subsidiaries for the three months
then ended, duly certified by the chief financial officer of the
Borrower, copies of which have been furnished to each Lender, fairly
present, subject, in the case of said balance sheet as at March 31,
2002, and said statements of income and cash flows for the three months
then ended, to year-end audit adjustments, the Consolidated financial
condition of the Borrower and its Subsidiaries as at such dates and the
Consolidated results of the operations of the Borrower and its
Subsidiaries for the periods ended on such dates, all in accordance
with generally accepted accounting principles consistently applied.
(f) There is no pending or threatened action, suit,
investigation, litigation or proceeding, including, without limitation,
any Environmental Action, affecting the Borrower or any of its
Subsidiaries before any court, governmental agency or arbitrator that
(i) could be reasonably likely to have a Material Adverse Effect or
(ii) purports to affect the legality, validity or enforceability of
this Agreement or any Note or the consummation of the transactions
contemplated hereby.
(g) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U issued by the Board of Governors of the
Federal Reserve System), and no proceeds of any Advance will be used to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock.
(h) The Borrower is not an "investment company", or a
company "controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
(i) Neither this Agreement, the Information Memorandum nor
any other document delivered by or on behalf of the Borrower or any of
its Subsidiaries in connection with this Agreement or included therein
contained or contains any material misstatement of fact or omitted or
omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(j) Since December 31, 2001, there has been no Material
Adverse Change.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA and Environmental Laws.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Borrower nor any of its
Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to
its property and becomes enforceable against its other creditors.
(c) Maintenance of Insurance. Maintain, and cause each of
its Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which the
Borrower or such Subsidiary operates.
(d) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its corporate existence, rights (charter and statutory) and franchises;
provided, however, that the Borrower and its Subsidiaries may
consummate any merger or consolidation permitted under Section 5.02(b)
and provided further that neither the Borrower nor any of its
Subsidiaries shall be required to preserve any right or franchise if
the Board of Directors of the Borrower or such Subsidiary shall
determine that the preservation thereof is no longer desirable in the
conduct of the business of the Borrower or such Subsidiary, as the case
may be, and that the loss thereof is not disadvantageous in any
material respect to the Borrower, such Subsidiary or the Lenders.
(e) Visitation Rights. At any reasonable time during normal
business hours and from time to time upon reasonable notice, permit the
Agent or any of the Lenders or any agents or representatives thereof,
to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers and
with their independent certified public accountants.
(f) Keeping of Books. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, in which full
and correct entries shall be made of all financial transactions and the
assets and business of the Borrower and each such Subsidiary in
accordance with generally accepted accounting principles in effect from
time to time.
(g) Maintenance of Properties, Etc. Maintain and preserve,
and cause each of its Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted.
(h) Transactions with Affiliates. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
this Agreement with any of their Affiliates (other than the Borrower
and its Subsidiaries) on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate.
(i) Reporting Requirements. Furnish to the Lenders:
(i) as soon as available and in any event within 45
days after the end of each of the first three quarters of each
fiscal year of the Borrower, the Consolidated balance sheet of
the Borrower and its Subsidiaries as of the end of such
quarter and Consolidated statements of income and cash flows
of the Borrower and its Subsidiaries for the period commencing
at the end of the previous fiscal year and ending with the end
of such quarter, duly certified (subject to year-end audit
adjustments) by the chief financial officer or treasurer of
the Borrower as having been prepared in accordance with
generally accepted accounting principles and certificates of
the chief financial officer or treasurer of the Borrower as to
compliance with the terms of this Agreement and setting forth
in reasonable detail the calculations necessary to demonstrate
compliance with Section 5.03, provided that in the event of
any change in generally accepted accounting principles used in
the preparation of such financial statements, the Borrower
shall also provide within a reasonable time, if necessary for
the determination of compliance with Section 5.03, a statement
of reconciliation conforming such financial statements to
GAAP;
(ii) as soon as available and in any event within 90
days after the end of each fiscal year of the Borrower, a copy
of the annual audit report for such year for the Borrower and
its Subsidiaries, containing the Consolidated balance sheet of
the Borrower and its Subsidiaries as of the end of such fiscal
year and Consolidated statements of income and cash flows of
the Borrower and its Subsidiaries for such fiscal year, in
each case accompanied by an opinion acceptable to the Required
Lenders by PricewaterhouseCoopers LLP or other independent
public accountants acceptable to the Required Lenders and
certificates of the chief financial officer or treasurer of
the Borrower as to compliance with the terms of this Agreement
and setting forth in reasonable detail the calculations
necessary to demonstrate compliance with Section 5.03,
provided that in the event of any change in generally accepted
accounting principles used in the preparation of such
financial statements, the Borrower shall also provide within a
reasonable time, if necessary for the determination of
compliance with Section 5.03, a statement of reconciliation
conforming such financial statements to GAAP;
(iii) as soon as possible and in any event within
five days after the occurrence of each Default continuing on
the date of such statement, a statement of the chief financial
officer of the Borrower setting forth details of such Default
and the action that the Borrower has taken and proposes to
take with respect thereto;
(iv) promptly after the sending or filing thereof,
copies of all reports that the Borrower sends to any of its
securityholders, and copies of all reports and registration
statements that the Borrower or any Subsidiary files with the
Securities and Exchange Commission or any national securities
exchange;
(v) promptly after the commencement thereof, notice
of all actions and proceedings before any court, governmental
agency or arbitrator affecting the Borrower or any of its
Subsidiaries of the type described in Section 4.01(f); and
(vi) such other information respecting the Borrower
or any of its Subsidiaries as any Lender through the Agent may
from time to time reasonably request.
SECTION 5.02. Negative Covenants. So long as any
Advance shall remain unpaid or any Lender shall have any Commitment hereunder,
the Borrower will not:
(a) Liens, Etc. Create or suffer to exist, or permit any of
its Subsidiaries to create or suffer to exist, any Lien on or with
respect to any of its properties, whether now owned or hereafter
acquired, or assign, or permit any of its Subsidiaries to assign, any
right to receive income, other than:
(i) Permitted Liens,
(ii) purchase money Liens upon or in any real
property or equipment acquired or held by the Borrower or any
Subsidiary in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt
incurred solely for the purpose of financing the acquisition
of such property or equipment, or Liens existing on such
property or equipment at the time of its acquisition (other
than any such Liens created in contemplation of such
acquisition that were not incurred to finance the acquisition
of such property) or extensions, renewals or replacements of
any of the foregoing for the same or a lesser amount,
provided, however, that no such Lien shall extend to or cover
any properties of any character other than the real property
or equipment being acquired, and no such extension, renewal or
replacement shall extend to or cover any properties not
theretofore subject to the Lien being extended, renewed or
replaced, provided further that the aggregate principal amount
of the indebtedness secured by the Liens referred to in this
clause (ii) shall not exceed $100,000,000 at any time
outstanding,
(iii) the Liens existing on the Effective Date and
described on Schedule 5.02(a) hereto,
(iv) other Liens securing Debt in an aggregate
principal amount not to exceed $50,000,000,
(v) the replacement, extension or renewal of any
Lien permitted by clause (iii) above upon or in the same
property theretofore subject thereto or the replacement,
extension or renewal (without increase in the amount or change
in any direct or contingent obligor) of the Debt secured
thereby, and
(vi) Liens secured by property occupied or to be
occupied by the Borrower as its corporate headquarters,
securing obligations incurred to acquire or construct and
finishout such headquarters.
(b) Mergers, Etc. Merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or any substantial part
of its assets (whether now owned or hereafter acquired) to, any Person,
or permit any of its Subsidiaries to do so, except that (x)(i) the
Borrower or any of its Subsidiaries may sell or transfer real property
including improvements thereon in connection with a sale and leaseback
transaction, (ii) any Subsidiary of the Borrower may merge or
consolidate with or into, or dispose of assets to, any other Subsidiary
of the Borrower, (iii) any Subsidiary of the Borrower may merge into or
dispose of assets to the Borrower and (iv) the Borrower may merge with
any other Person so long as the Borrower is the surviving corporation,
provided, in each case, that no Default shall have occurred and be
continuing at the time of such proposed transaction or would result
therefrom and (y) the Borrower and its Subsidiaries may (1) sell
inventory in the ordinary course of business and (2) sell, transfer,
convey, lease or otherwise dispose of less than any substantial part of
the assets of the Borrower and its Subsidiaries, taken as a whole.
For purposes of this subsection (b), a sale, transfer, conveyance,
lease or other disposition of assets shall be deemed to be a
"substantial part" of the assets of the Borrower and its Subsidiaries
only if the value of such assets, when added to the value of all other
assets sold, transferred, conveyed, leased or otherwise disposed of by
the Borrower and its Subsidiaries (other than as expressly permitted
pursuant to this subsection (b)) during the same fiscal year, exceeds
15% of the Borrower's consolidated total assets determined as of the
end of the immediately preceding fiscal year. As used in the preceding
sentence, the term "value" shall mean, with respect to any asset
disposed of, the greater of such asset's book or fair market value as
of the date of disposition, with "book value" being the value of such
asset as would appear immediately prior to such disposition on a
balance sheet of the owner of such asset prepared in accordance with
generally accepted accounting principles.
(c) Accounting Changes. Make or permit, or permit any of
its Subsidiaries to make or permit, any change in accounting policies
or reporting practices, except as required or permitted by generally
accepted accounting principles.
(d) Change in Nature of Business. Make, or permit any of
its Subsidiaries to make, any material change in the nature of its
business as carried on at the date hereof.
(e) Investments in Other Persons. Make or hold, or
permit any of its Subsidiaries to make or hold, any Investment in
any Person other than:
(i) Investments by the Borrower and its
Subsidiaries in their Subsidiaries outstanding on the date
hereof;
(ii) loans and advances to employees in the ordinary
course of the business of the Borrower and its Subsidiaries as
presently conducted in an aggregate principal amount not to
exceed $10,000,000 at any time outstanding;
(iii) Investments in Marketable Securities;
(iv) Investments consisting of extensions or credit
in the nature of accounts receivable or notes receivable
arising from the sale of goods and services, or shares of
stock, obligations or other securities received in settlement
of claims, in each case, arising in the ordinary course of
business;
(v) Investments existing on the Effective Date and
described on Schedule 5.02(e) hereto;
(vi) deposits in bank accounts maintained for
operational purposes, within the limits established by
the Borrower's corporate cash investment policy; and
(vii) other Investments in an aggregate amount
invested not to exceed 15% of Consolidated Tangible Net Worth
at any time.
SECTION 5.03. Financial Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Borrower will:
(a) Leverage Ratio. Maintain a ratio of Consolidated
Funded Debt to Consolidated EBITDA for the period of four fiscal
quarters most recently ended of not more than the 3.0:1.0.
(b) Fixed Charge Coverage Ratio. Maintain a ratio of
Consolidated EBITDAR of the Borrower and its Subsidiaries to the sum of
(i) interest payable on, and amortization of debt discount in respect
of, all Debt during the period of four fiscal quarters most recently
ended plus (ii) rentals payable under leases of real or personal, or
mixed, property during such period, in each case, by the Borrower and
its Subsidiaries of not less than 2.0:1.0.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following
events ("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any
Advance when the same becomes due and payable; or the Borrower shall
fail to pay any interest on any Advance or make any other payment of
fees or other amounts payable under this Agreement or any Note within
three Business Days after the same becomes due and payable; or
(b) Any representation or warranty made by the Borrower
herein or by the Borrower (or any of its officers) in connection with
this Agreement shall prove to have been incorrect in any material
respect when made; or
(c) (i) The Borrower shall fail to perform or observe
any term, covenant or agreement contained in Section 5.01(d) (as to the
Borrower's corporate existence), (e), (h) or (i), 5.02 or 5.03, or (ii)
the Borrower shall fail to perform or observe any other term, covenant
or agreement contained in this Agreement on its part to be performed or
observed if such failure shall remain unremedied for 10 days after
written notice thereof shall have been given to the Borrower by the
Agent or any Lender; or
(d) The Borrower or any of its Subsidiaries shall fail to
pay any principal of or premium or interest on any Debt that is
outstanding in a principal or notional amount of at least $50,000,000 in
the aggregate (but excluding Debt outstanding hereunder) of the Borrower
or such Subsidiary (as the case may be), when the same becomes due and
payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt; or any such Debt shall be declared to be due and
payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturity
thereof; or
(e) The Borrower or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against the Borrower or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, custodian or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of 30
days, or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
or, it or for any substantial part of its property) shall occur; or
the Borrower or any of its Subsidiaries shall take any corporate action
to authorize any of the actions set forth above in this subsection (e);
or
(f) Judgments or orders for the payment of money in excess
of $50,000,000 in the aggregate shall be rendered against the Borrower
or any of its Subsidiaries and either (i) enforcement proceedings shall
have been commenced by any creditor upon such judgment or order or (ii)
there shall be any period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; provided, however, that any such
judgment or order shall not be an Event of Default under this Section
6.01(f) if and for so long as (i) the amount of such judgment or order
is covered by a valid and binding policy of insurance between the
defendant and the insurer covering payment thereof and (ii) such
insurer, which shall be rated at least "A" by A.M. Best Company, has
been notified of, and has not disputed the claim made for payment of,
the amount of such judgment or order; or
(g) (i) Any Person or two or more Persons acting in concert
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934), directly or indirectly, of Voting Stock of the
Borrower (or other securities convertible into such Voting Stock)
representing 20% or more of the combined voting power of all Voting
Stock of the Borrower; or (ii) during any period of up to 24
consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month period
were directors of the Borrower shall cease for any reason to constitute
a majority of the board of directors of the Borrower (except to the
extent that individuals who at the beginning of such 24-month period
were replaced by individuals (x) elected by 66-2/3% of the remaining
members of the board of directors of the Borrower or (y) nominated for
election by a majority of the remaining members of the board of
directors of the Borrower and thereafter elected as directors by the
shareholders of the Borrower); or
(i) The Borrower or any of its ERISA Affiliates shall incur,
or shall be reasonably likely to incur, liability in excess of
$50,000,000 in the aggregate as a result of one or more of the
following: (i) the occurrence of any ERISA Event; (ii) the partial or
complete withdrawal of the Borrower or any of its ERISA Affiliates from
a Multiemployer Plan; or (iii) the reorganization or termination of a
Multiemployer Plan;
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower; provided, however, that in the
event of an actual or deemed entry of an order for relief with respect to the
Borrower under the Federal Bankruptcy Code, (A) the obligation of each Lender to
make Advances shall automatically be terminated and (B) the Advances, all such
interest and all such amounts shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower.
ARTICLE VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Lender hereby
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under this Agreement as are delegated to
the Agent by the terms hereof, together with such powers and discretion as are
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement (including, without limitation, enforcement or collection of the
Notes), the Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; provided, however, that the Agent shall not be
required to take any action that exposes the Agent to personal liability or that
is contrary to this Agreement or applicable law. The Agent agrees to give to
each Lender prompt notice of each notice given to it by the Borrower pursuant to
the terms of this Agreement.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agent: (i) may treat
the Lender that made any Advance as the holder of the Debt resulting therefrom
until the Agent receives and accepts an Assumption Agreement entered into by an
Assuming Lender as provided in Section 2.18 or an Assignment and Acceptance
entered into by such Lender, as assignor, and an Eligible Assignee, as assignee,
as provided in Section 8.07; (ii) may consult with legal counsel (including
counsel for the Borrower), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) shall not have any duty to ascertain or to inquire as to the
performance, observance or satisfaction of any of the terms, covenants or
conditions of this Agreement on the part of the Borrower or the existence at any
time of any Default or to inspect the property (including the books and records)
of the Borrower; (v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, this Agreement or any other
instrument or document furnished pursuant hereto; and (vi) shall incur no
liability under or in respect of this Agreement by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telecopier,
telegram or telex) believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 7.03. Citibank and Affiliates. With respect to its
Commitment, the Advances made by it and the Note issued to it, Citibank shall
have the same rights and powers under this Agreement as any other Lender and may
exercise the same as though it were not the Agent; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated, include Citibank in its
individual capacity. Citibank and its Affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, the
Borrower, any of its Subsidiaries and any Person who may do business with or own
securities of the Borrower or any such Subsidiary, all as if Citibank were not
the Agent and without any duty to account therefor to the Lenders. The Agent
shall have no duty to disclose information obtained or received by it or any of
its Affiliates relating to the Borrower or its Subsidiaries to the extent such
information was obtained or received in any capacity other than as Agent.
SECTION 7.04. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Agent or any other
Lender and based on the financial statements referred to in Section 4.01 and
such other 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 Agent 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.
SECTION 7.05. Indemnification. (a) The Lenders ratably agree
to indemnify the Agent (to the extent not reimbursed by the Borrower), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the
Agent in any way relating to or arising out of this Agreement or any action
taken or omitted by the Agent under this Agreement (collectively, the
"Indemnified Costs"), provided that no Lender shall be liable for any portion of
the Indemnified Costs resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender agrees to reimburse
the Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including reasonable counsel fees) incurred by the Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement, to the extent that the Agent is not reimbursed for such expenses
by the Borrower. In the case of any investigation, litigation or proceeding
giving rise to any Indemnified Costs, this Section 7.05 applies whether any such
investigation, litigation or proceeding is brought by the Agent, any Lender or a
third party.
(b) For purposes of this Section 7.05, the Lenders'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
(other than Competitive Bid Advances) outstanding at such time and owing to the
respective Lenders and (ii) their respective Unused Commitments at such time.
The failure of any Lender to reimburse the Agent promptly upon demand for its
ratable share of any amount required to be paid by the Lenders to the Agent as
provided herein shall not relieve any other Lender of its obligation hereunder
to reimburse the Agent for its ratable share of such amount, but no Lender shall
be responsible for the failure of any other Lender to reimburse the Agent for
such other Lender's ratable share of such amount. Without prejudice to the
survival of any other agreement of any Lender hereunder, the agreement and
obligations of each Lender contained in this Section 7.05 shall survive the
payment in full of principal, interest and all other amounts payable hereunder
and under the Notes.
SECTION 7.06. Successor Agent. The Agent may resign at any
time by giving written notice thereof to the Lenders and the Borrower and may be
removed at any time with or without cause by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent. If no successor Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days after
the retiring Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement.
SECTION 7.07. Other Agents. Each Lender hereby acknowledges
that neither the documentation agent nor any other Lender designated as any
"Agent" on the signature pages hereof has any liability hereunder other than in
its capacity as a Lender.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Revolving Credit Notes, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no amendment, waiver
or consent shall, unless in writing and signed by all the Lenders, do any of the
following: (a) waive any of the conditions specified in Section 3.01, (b)
increase the Commitments of the Lenders, (c) reduce the principal of, or
interest on, the Revolving Credit Advances or any fees or other amounts payable
hereunder, (d) postpone any date fixed for any payment of principal of, or
interest on, the Revolving Credit Advances or any fees or other amounts payable
hereunder, (e) change the percentage of the Commitments or the aggregate unpaid
principal amount of the Revolving Credit Advances, or the number of Lenders,
that shall be required for the Lenders or any of them to take any action
hereunder or (f) amend this Section 8.01; and provided further that no
amendment, waiver or consent shall, unless in writing and signed by the Agent in
addition to the Lenders required above to take such action, affect the rights or
duties of the Agent under this Agreement or any Note.
SECTION 8.02. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing (including telecopier,
telegraphic or telex communication) and mailed, telecopied, telegraphed, telexed
or delivered, if to the Borrower, at its address at 100 Throckmorton Street,
Suite 1800, Fort Worth, Texas 76102, Attention: Martin Moad, Treasurer; if to
any Initial Lender, at its Domestic Lending Office specified opposite its name
on Schedule I hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assumption Agreement or the Assignment and Acceptance pursuant
to which it became a Lender; and if to the Agent, at its address at Two Penns
Way, New Castle, Delaware 19720, Attention: Bank Loan Syndications Department;
or, as to the Borrower or the Agent, at such other address as shall be
designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower and the Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed or telexed, be
effective when deposited in the mails, telecopied, delivered to the telegraph
company or confirmed by telex answerback, respectively, except that notices and
communications to the Agent pursuant to Article II, III or VII shall not be
effective until received by the Agent. Delivery by telecopier of an executed
counterpart of any amendment or waiver of any provision of this Agreement or the
Notes or of any Exhibit hereto to be executed and delivered hereunder shall be
effective as delivery of a manually executed counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of
any Lender or the Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to
pay on demand all reasonable costs and expenses of the Agent in connection with
the preparation, execution, delivery, administration, modification and amendment
of this Agreement, the Notes and the other documents to be delivered hereunder,
including, without limitation, (A) all reasonable due diligence, syndication
(including printing, distribution and bank meetings), transportation, computer,
duplication, appraisal, consultant, and audit expenses and (B) the reasonable
fees and expenses of counsel for the Agent with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under this
Agreement. The Borrower further agrees to pay on demand all costs and expenses
of the Agent and the Lenders, if any (including, without limitation, reasonable
counsel fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement, the Notes and
the other documents to be delivered hereunder, including, without limitation,
reasonable fees and expenses of counsel for the Agent and each Lender in
connection with the enforcement of rights under this Section 8.04(a).
(b) The Borrower agrees to indemnify and hold harmless the
Agent and each Lender and each of their Affiliates and their officers,
directors, employees, agents and advisors (each, an "Indemnified Party") from
and against any and all claims, damages, losses, liabilities and expenses
(including, without limitation, reasonable fees and expenses of counsel)
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation or proceeding or
preparation of a defense in connection therewith) (i) the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances or (ii) the actual or alleged presence of Hazardous
Materials on any property of the Borrower or any of its Subsidiaries or any
Environmental Action relating in any way to the Borrower or any of its
Subsidiaries, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross negligence or
willful misconduct. In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 8.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by the Borrower, its directors, equityholders or creditors
or an Indemnified Party or any other Person, whether or not any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. The Borrower also agrees not to assert any
claim for special, indirect, consequential or punitive damages against the
Agent, any Lender, any of their Affiliates, or any of their respective
directors, officers, employees, attorneys and agents, on any theory of
liability, arising out of or otherwise relating to the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance or LIBO Rate Advance is made by the Borrower to or for
the account of a Lender other than on the last day of the Interest Period for
such Advance, as a result of a payment or Conversion pursuant to Section 2.08(d)
or (e), 2.10 or 2.12, acceleration of the maturity of the Notes pursuant to
Section 6.01 or for any other reason, or by an Eligible Assignee to a Lender
other than on the last day of the Interest Period for such Advance upon an
assignment of rights and obligations under this Agreement pursuant to Section
8.07 as a result of a demand by the Borrower pursuant to Section 8.07(a), the
Borrower shall, upon demand by such Lender (with a copy of such demand to the
Agent), pay to the Agent for the account of such Lender any amounts required to
compensate such Lender for any additional losses, costs or expenses that it may
reasonably incur as a result of such payment or Conversion, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance. The loss of a Lender shall include an amount equal to the
excess, if any, as reasonably determined by such Lender of (A) its cost of
obtaining the funds for the Advance paid or Converted on other than the last day
of an Interest Period, to the last day of such Interest Period over (B) the
amount of interest (as reasonably determined by such Lender) that could be
realized by such Lender in reemploying during such period the funds paid or
Converted.
(d) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in Sections 2.11, 2.14 and 8.04 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the Notes.
SECTION 8.05. Right of Set-off. Upon (i) the occurrence and
during the continuance of any Event of Default and (ii) the making of the
request or the granting of the consent specified by Section 6.01 to authorize
the Agent to declare the Advances due and payable pursuant to the provisions of
Section 6.01, 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 indebtedness at any time owing by such
Lender or such Affiliate to or for the credit or the account of the Borrower
against any and all of the obligations of the Borrower now or hereafter existing
under this Agreement and the Note held by such Lender, whether or not such
Lender shall have made any demand under this Agreement or such Note and although
such obligations may be unmatured. Each Lender agrees promptly to notify the
Borrower after any such set-off and application, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The rights of each Lender and its Affiliates under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender and its Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall become
effective (other than Sections 2.01 and 2.03, which shall only become effective
upon satisfaction of the conditions precedent set forth in Section 3.01) when it
shall have been executed by the Borrower and the Agent and when the Agent shall
have been notified by each Initial Lender that such Initial Lender has executed
it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agent and each Lender and their respective successors and assigns,
except that the Borrower shall not have the right to assign its rights hereunder
or any interest herein without the prior written consent of the Lenders.
SECTION 8.07. Assignments and Participations. (a) Each Lender
may and, if demanded by the Borrower (following a demand by such Lender pursuant
to Section 2.11 or 2.14, or an assertion by such Lender of illegality under
Section 2.12) upon at least five Business Days' notice to such Lender and the
Agent, will assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Revolving Credit Advances owing to it and the
Revolving Credit Note or Notes held by it); provided, however, that (i) each
such assignment shall be of a constant, and not a varying, percentage of all
rights and obligations under this Agreement (other than any right to make
Competitive Bid Advances, Competitive Bid Advances owing to it and Competitive
Bid Notes), (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $10,000,000 or an
integral multiple of $1,000,000 in excess thereof unless the Borrower and the
Agent otherwise agree, (iii) each such assignment shall be to an Eligible
Assignee, (iv) each such assignment made as a result of a demand by the Borrower
pursuant to this Section 8.07(a) shall be arranged by the Borrower after
consultation with the Agent and shall be either an assignment of all of the
rights and obligations of the assigning Lender under this Agreement or an
assignment of a portion of such rights and obligations made concurrently with
another such assignment or other such assignments that together cover all of the
rights and obligations of the assigning Lender under this Agreement, (v) no
Lender shall be obligated to make any such assignment as a result of a demand by
the Borrower pursuant to this Section 8.07(a) unless and until such Lender shall
have received one or more payments from either the Borrower or one or more
Eligible Assignees in an aggregate amount at least equal to the aggregate
outstanding principal amount of the Advances owing to such Lender, together with
accrued interest thereon to the date of payment of such principal amount and all
other amounts payable to such Lender under this Agreement, and (vi) the parties
to each such assignment shall execute and deliver to the Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Revolving Credit Note subject to such assignment and a processing and
recordation fee of $3,500 payable by the parties to each such assignment,
provided, however, that in the case of each assignment made as a result of a
demand by the Borrower, such recordation fee shall be payable by the Borrower
except that no such recordation fee shall be payable in the case of an
assignment made at the request of the Borrower to an Eligible Assignee that is
an existing Lender, and (vii) any Lender may, without the approval of the
Borrower and the Agent, assign all or a portion of its rights to any of its
Affiliates. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, (x) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights (other than its rights under Sections 2.11, 2.14 and 8.04
to the extent any claim thereunder relates to an event arising prior such
assignment) and be released from its obligations under this Agreement (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).
(b) By executing and delivering an Assignment and
Acceptance, the Lender assignor thereunder and the assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Acceptance, 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, or the perfection or priority of any lien or security
interest created or purported to be created under or in connection with, this
Agreement or any other instrument or document furnished pursuant hereto; (ii)
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to 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 confirms that it has received a copy of this Agreement, together
with copies of the financial statements referred to in Section 4.01 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; (iv)
such assignee will, independently and without reliance upon the 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; (v) such assignee
confirms that it is an Eligible Assignee; (vi) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Agreement are required to be performed by it as a Lender.
(c) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee representing that it is an
Eligible Assignee, together with any Revolving Credit Note or Notes subject to
such assignment, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit C hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower.
(d) The Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assumption Agreement and each Assignment and
Acceptance delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitment of, and principal
amount of the Advances owing to, each Lender from time to time (the "Register").
The entries in the Register shall be conclusive and binding for all purposes,
absent demonstrable error, and the Borrower, the Agent and the Lenders may treat
each Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Each Lender may sell participations to one or more banks
or other entities (other than the Borrower or any of its Affiliates) in or to
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitment, the Advances owing to it
and any Note or Notes held by it); provided, however, that (i) such Lender's
obligations under this Agreement (including, without limitation, its Commitment
to the Borrower hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any such Note for all
purposes of this Agreement, (iv) the Borrower, the Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and (v) no participant
under any such participation shall have any right to approve any amendment or
waiver of any provision of this Agreement or any Note, or any consent to any
departure by the Borrower therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Advances or
any fees or other amounts payable hereunder, in each case to the extent subject
to such participation, or postpone any date fixed for any payment of principal
of, or interest on, the Advances or any fees or other amounts payable hereunder,
in each case to the extent subject to such participation.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, 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,
the assignee or participant or proposed assignee or participant shall agree to
preserve the confidentiality of any Confidential Information relating to the
Borrower received by it from such Lender.
(g) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Advances owing to it and any Note or Notes held by it) in favor of any Federal
Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
SECTION 8.08. Confidentiality. Neither the Agent nor any
Lender shall disclose any Confidential Information to any other Person without
the written consent of the Borrower, other than (a) to the Agent's or such
Lender's Affiliates and to their officers, directors, employees, agents and
advisors as are necessary and appropriate for the administration of this
Agreement and, as contemplated by Section 8.07(f), to actual or prospective
assignees and participants, and then only on a confidential basis, (b) as
required by any law, rule or regulation or judicial process, (c) as requested or
required by any state, federal or foreign authority or examiner regulating banks
or banking and (d) 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.
SECTION 8.09. Governing Law. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 8.10. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the Notes, or for recognition or enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the extent permitted by law, in such federal court. The Borrower does business
in the State of New York through numerous locations in such State. The Borrower
has appointed Ct Corporation System as its agent for service of process in the
State of New York, and until such time as the Borrower notifies the Agent of a
change in agent for service of process, the Borrower hereby agrees that service
of process in any such action or proceeding brought in the any such New York
State court or in such federal court may be made upon CT Corporation System at
its offices at 111 Eighth Avenue, 13th Floor, New York, New York 10011 (the
"Process Agent") and agrees that the failure of the Process Agent to give any
notice of any such service shall not impair or affect the validity of such
service or of any judgment rendered in any action or proceeding based thereon.
The Borrower shall give the Agent notice of any change in agent for service of
process in the State of New York. The Borrower hereby further irrevocably
consents to the service of process in any action or proceeding in such courts by
the mailing thereof by any parties hereto by registered or certified mail,
postage prepaid, to the Borrower at its address specified pursuant to Section
8.02. Each of the parties hereto agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or the Notes in the courts of
any jurisdiction.
(b) Each of the parties hereto irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
the Notes in any New York State or federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
SECTION 8.13. Waiver of Jury Trial. Each of the Borrower, the
Agent and the Lenders hereby irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement or the Notes or the
actions of the Agent or any Lender in the negotiation, administration,
performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
RADIOSHACK CORPORATION
By __________________________
Title:
CITIBANK, N.A.,
as Agent
By __________________________
Title:
Initial Lenders
---------------
Commitment
----------
$37,500,000 CITIBANK, N.A.
By __________________________
Title:
$37,500,000 BANK OF AMERICA, N.A.
By __________________________
Title:
$32,500,000 FLEET NATIONAL BANK
By __________________________
Title:
$32,500,000 WACHOVIA BANK, NATIONAL ASSOCIATION
By __________________________
Title:
$12,500,000 FIFTH THIRD BANK
By __________________________
Title:
$12,500,000 SUNTRUST BANK
By __________________________
Title:
$12,500,000 U.S. BANK NATIONAL ASSOCIATION
By __________________________
Title:
$7,500,000 HIBERNIA NATIONAL BANK
By __________________________
Title:
$20,000,000 ROYAL BANK OF CANADA
By __________________________
Title:
$12,500,000 KEYBANK NATIONAL ASSOCIATION
By __________________________
Title:
$12,500,000 NATIONAL CITY BANK
By __________________________
Title:
$12,500,000 WELLS FARGO BANK, NATIONAL ASSOCIATION
By __________________________
Title:
$7,500,000 HUNTINGTON NATIONAL BANK
By __________________________
Title:
$12,500,000 BANCA NAZIONALE DEL LAVORO
By __________________________
Title:
$25,000,000 THE BANK OF NEW YORK
By __________________________
Title:
$12,500,000 BANK OF TOKYO MITSUBISHI TRUST COMPANY
By __________________________
Title:
$300,000,000 Total of the Commitments
SCHEDULE I
RADIOSHACK CORPORATION
364-DAY CREDIT AGREEMENT
APPLICABLE LENDING OFFICES
------------------------------------------ -------------------------------------- -----------------------------------
Name of Initial Lender Domestic Lending Office Eurodollar Lending Office
------------------------------------------ --------------------------------------- -----------------------------------
------------------------------------------ --------------------------------------- -----------------------------------
Banca Nazionale del Lavoro 25 West 51st Street 25 West 51st Street
New York, NY 10019 New York, NY 10019
Attn: Anna Hernandez Attn: Anna Hernandez
T: 212 314-679 T: 212 314-679
F: 212 765-2978 F: 212 765-2978
------------------------------------------ --------------------------------------- -----------------------------------
Bank of America, N.A. 1850 Gateway Blvd, 5th Floor 1850 Gateway Blvd, 5th Floor
Concord, CA 84520 Concord, CA 84520
Attn: Jessical Voulgarelis Attn: Jessical Voulgarelis
T: 925 675-7817 T: 925 675-7817
F; 888 969-9317 F; 888 969-9317
------------------------------------------ --------------------------------------- -----------------------------------
Bank of New York One Wall Street One Wall Street
New York, NY 10286 New York, NY 10286
Attn: Madlyn Myrick Attn: Madlyn Myrick
T: 212 635-1366 T: 212 635-1366
F: 212 635-1481 F: 212 635-1481
------------------------------------------ --------------------------------------- -----------------------------------
Bank of Tokyo Mistubishi Trust Company 1251 Avenue of the Americas 1251 Avenue of the Americas
New York, NY 10020 New York, NY 10020
Attn: Paresh Shah Attn: Paresh Shah
T: 212 782-5649 T: 212 782-5649
F: 212 782-6440 F: 212 782-6440
------------------------------------------ --------------------------------------- -----------------------------------
Citibank, N.A. Two Penns Way, Suite 200 Two Penns Way, Suite 200
New Castle, DE 19720 New Castle, DE 19720
Attn: Vincent Farrell Attn: Vincent Farrell
T: 302 894-6032 T: 302 894-6032
F: 302 894-6120 F: 302 894-6120
------------------------------------------ --------------------------------------- -----------------------------------
Fifth Third Bank 38 Fountain Square Plaza 38 Fountain Square Plaza
MD 10904 MD 10904
Cincinnati, OH 45263 Cincinnati, OH 45263
Attn: Chris Motley Attn: Chris Motley
T: 513 579-4110 T: 513 579-4110
F: 513 744-5947 F: 513 744-5947
------------------------------------------ --------------------------------------- -----------------------------------
Fleet National Bank 100 Federal Street 100 Federal Street
MADE 10809A MADE 10809A
Boston, MA 02110 Boston, MA 02110
Attn: Kalams Herald Attn: Kalams Herald
T: 617 434-3780 T: 617 434-3780
F: 617 434-9933 F: 617 434-9933
------------------------------------------ --------------------------------------- -----------------------------------
Hibernia National Bank 313 Carondelet Street 313 Carondelet Street
New Orleans, LA 70130 New Orleans, LA 70130
Attn: Shelly Strada Attn: Shelly Strada
T: 504 533-2808 T: 504 533-2808
F: 504 533-5344 F: 504 533-5344
------------------------------------------ --------------------------------------- -----------------------------------
------------------------------------------ --------------------------------------- -----------------------------------
Huntington National Bank The Huntington Center The Huntington Center
Columbus, OH 43287 Columbus, OH 43287
Attn: Lori Scott Attn: Lori Scott
T: 614 480-5778 T: 614 480-5778
F: 614 480-5791 F: 614 480-5791
------------------------------------------ --------------------------------------- -----------------------------------
KeyBank National Association 127 Public Square 127 Public Square
Cleveland, OH 44114 Cleveland, OH 44114
Attn: Laura Binkley Attn: Laura Binkley
T: 216 689-4448 T: 216 689-4448
F: 216 689-4981 F: 216 689-4981
------------------------------------------ --------------------------------------- -----------------------------------
National City Bank 155 East Broad Street 155 East Broad Street
Columbus, OH Columbus, OH
Attn: Vicki Niemela Attn: Vicki Niemela
T: 614 463-7133 T: 614 463-7133
F: 614 463-8572 F: 614 463-8572
------------------------------------------ --------------------------------------- -----------------------------------
Royal Bank of Canada One Liberty Plaza, 3rd Floor One Liberty Plaza, 3rd Floor
New York, NY 10006 New York, NY 10006
Attn: Ritta Lee Attn: Ritta Lee
T: 212 428-6448 T: 212 428-6448
F: 212 428-6459 F: 212 428-6459
------------------------------------------ --------------------------------------- -----------------------------------
SunTrust Bank 303 Peachtree Street, 10th Floor 303 Peachtree Street, 10th Floor
Atlanta, GA Atlanta, GA
Attn: Roshawn Orise Attn: Roshawn Orise
T: 404 230-1939 T: 404 230-1939
F: 4040 575-2730 F: 4040 575-2730
------------------------------------------ --------------------------------------- -----------------------------------
U.S. Bank National Association 400 City Center 400 City Center
Mail Code: OS-WI-CCO Mail Code: OS-WI-CCO
Oshkosh, WI 54901 Oshkosh, WI 54901
Attn: Connie Sweeney Attn: Connie Sweeney
T: 920 237-7604 T: 920 237-7604
F: 920 237-7993 F: 920 237-7993
------------------------------------------ --------------------------------------- -----------------------------------
Wachovia Bank, National Association 201 S. College Street, CP-17 201 S. College Street, CP-17
Charlotte, NC 28288 Charlotte, NC 28288
Attn: Cynthia Rawson Attn: Cynthia Rawson
T: 704 374-4425 T: 704 374-4425
F: 704 383-7997 F: 704 383-7997
------------------------------------------ --------------------------------------- -----------------------------------
Wells Fargo Bank, National Association 201 Third Street, 8th Floor 201 Third Street, 8th Floor
MAC A0187-081 MAC A0187-081
San Francisco, CA 94103 San Francisco, CA 94103
Attn: Rosanna Roxas Attn: Rosanna Roxas
T: 415 477-5425 T: 415 477-5425
F: 415 979-0675 F: 415 979-0675
------------------------------------------ --------------------------------------- -----------------------------------
Schedule 5.02(e)
Investments as of June 19, 2002
----------------------------------------------------- ------------------------------------- --------------------------
Investment made as part of a community effort to Note amount $
provide low income housing, including a note Ltd. Partnership 330,000.00
maturing on 9-30-2022, and a limited partnership $
interest. 1,598,375.00
----------------------------------------------------- ------------------------------------- --------------------------
World Wide Electronic Imports S. de R.L. de C.V. $
7,653,410.00
----------------------------------------------------- ------------------------------------- --------------------------
Total investments $
9,581,785.00
----------------------------------------------------- ------------------------------------- --------------------------
Schedule 5.02(a)
Existing Liens
None
EXHIBIT A-1 - FORM OF
REVOLVING CREDIT
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, 200_
FOR VALUE RECEIVED, the undersigned, Radioshack Corporation, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office on the Termination Date (each as defined in the Credit Agreement
referred to below) the principal sum of U.S.$[amount of the Lender's Commitment
in figures] or, if less, the aggregate principal amount of the Revolving Credit
Advances made by the Lender to the Borrower pursuant to the 364-Day Credit
Agreement dated as of June 19, 2002 among the Borrower, the Lender and certain
other lenders parties thereto, Bank of America, as administrative agent, Fleet
National Bank, as syndication agent, Wachovia Bank, National Association, as
documentation agent, Salomon Smith Barney Inc. and Banc of America Securities
Inc., as joint lead arrangers and bookrunners, and Citibank, N.A. as Agent for
the Lender and such other lenders (as amended or modified from time to time, the
"Credit Agreement"; the terms defined therein being used herein as therein
defined) outstanding on such date.
The Borrower promises to pay interest on the unpaid principal
amount of each Revolving Credit Advance from the date of such Revolving Credit
Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to Citibank, as Agent, at 388 Greenwich Street, New
York, New York 10013, in same day funds. Each Revolving Credit Advance owing to
the Lender by the Borrower pursuant to the Credit Agreement, and all payments
made on account of principal thereof, shall be recorded by the Lender and, prior
to any transfer hereof, endorsed on the grid attached hereto which is part of
this Promissory Note.
This Promissory Note is one of the Revolving Credit Notes
referred to in, and is entitled to the benefits of, the Credit Agreement. The
Credit Agreement, among other things, (i) provides for the making of Revolving
Credit Advances by the Lender to the Borrower from time to time in an aggregate
amount not to exceed at any time outstanding the U.S. dollar amount first above
mentioned, the indebtedness of the Borrower resulting from each such Revolving
Credit Advance being evidenced by this Promissory Note and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof upon the terms and conditions therein specified.
RADIOSHACK CORPORATION
By __________________________
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
Amount of
Date Amount of Principal Paid Unpaid Principal Notation
Advance or Prepaid Balance Made By
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
EXHIBIT A-2 - FORM OF
COMPETITIVE BID
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, 200_
FOR VALUE RECEIVED, the undersigned, Radioshack Corporation, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office (as defined in the 364-Day Credit Agreement dated as of June 19,
2002 among the Borrower, the Lender and certain other lenders parties thereto,
Bank of America, as administrative agent, Fleet National Bank, as syndication
agent, Wachovia Bank, National Association, as documentation agent, Salomon
Smith Barney Inc. and Banc of America Securities Inc., as joint lead arrangers
and bookrunners, and Citibank, N.A., as Agent for the Lender and such other
lenders (as amended or modified from time to time, the "Credit Agreement"; the
terms defined therein being used herein as therein defined)), on
_______________, 200_, the principal amount of U.S.$_______________].
The Borrower promises to pay interest on the unpaid principal
amount hereof from the date hereof until such principal amount is paid in
full, at the interest rate and payable on the interest payment date or
dates provided below:
Interest Rate: _____% per annum (calculated on the basis of a
year of _____ days for the actual number of days elapsed).
Both principal and interest are payable in lawful money of the
United States of America to Citibank, as agent, for the account of the Lender at
the office of Citibank, at 388 Greenwich Street, New York, New York 10013 in
same day funds.
This Promissory Note is one of the Competitive Bid Notes
referred to in, and is entitled to the benefits of, the Credit Agreement. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events.
The Borrower hereby waives presentment, demand, protest and
notice of any kind. No failure to exercise, and no delay in exercising, any
rights hereunder on the part of the holder hereof shall operate as a waiver of
such rights.
This Promissory Note shall be governed by, and construed in
accordance with, the laws of the State of New York.
RADIOSHACK CORPORATION
By __________________________
Title:
EXHIBIT B-1 - FORM OF NOTICE OF
REVOLVING CREDIT BORROWING
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Two Penns Way
New Castle, Delaware 19720
[Date]
Attention: Bank Loan Syndications Department
Ladies and Gentlemen:
The undersigned, Radioshack Corporation, refers to the 364-Day
Credit Agreement, dated as of June 19, 2002 (as amended or modified from time to
time, the "Credit Agreement", the terms defined therein being used herein as
therein defined), among the undersigned, certain Lenders parties thereto, Bank
of America, as administrative agent, Fleet National Bank, as syndication agent,
Wachovia Bank, National Association, as documentation agent, Salomon Smith
Barney Inc. and Banc of America Securities Inc., as joint lead arrangers and
bookrunners, and Citibank, N.A., as Agent for said Lenders, and hereby gives you
notice, irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests a Revolving Credit Borrowing under the Credit
Agreement, and in that connection sets forth below the information relating to
such Revolving Credit Borrowing (the "Proposed Revolving Credit Borrowing") as
required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Revolving Credit
Borrowing is _______________, 200_.
(ii) The Type of Advances comprising the Proposed Revolving
Credit Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Revolving Credit
Borrowing is $_______________.
[(iv) The initial Interest Period for each Eurodollar Rate
Advance made as part of the Proposed Revolving Credit Borrowing is
_____ month[s].]
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed
Revolving Credit Borrowing:
(A) the representations and warranties contained in Section
4.01(a) through (i) of the Credit Agreement are correct, before and
after giving effect to the Proposed Revolving Credit Borrowing and to
the application of the proceeds therefrom, as though made on and as of
such date; and
(B) no event has occurred and is continuing, or would result
from such Proposed Revolving Credit Borrowing or from the application
of the proceeds therefrom, that constitutes a Default.
Very truly yours,
RADIOSHACK CORPORATION
By __________________________
Title:.
EXHIBIT B-2 - FORM OF NOTICE OF
COMPETITIVE BID BORROWING
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Two Penns Way
New Castle, Delaware 19720
[Date]
Attention: Bank Loan Syndications Department
Ladies and Gentlemen:
The undersigned, Radioshack Corporation, refers to the 364-Day
Credit Agreement, dated as of June 19, 2002 (as amended or modified from time to
time, the "Credit Agreement", the terms defined therein being used herein as
therein defined), among the undersigned, certain Lenders parties thereto, Bank
of America, as administrative agent, Fleet National Bank, as syndication agent,
Wachovia Bank, National Association, as documentation agent, Salomon Smith
Barney Inc. and Banc of America Securities Inc., as joint lead arrangers and
bookrunners, and Citibank, N.A., as Agent for said Lenders, and hereby gives you
notice, irrevocably, pursuant to Section 2.03 of the Credit Agreement that the
undersigned hereby requests a Competitive Bid Borrowing under the Credit
Agreement, and in that connection sets forth the terms on which such Competitive
Bid Borrowing (the "Proposed Competitive Bid Borrowing") is requested to be
made:
(A) Date of Competitive Bid Borrowing ________________________
(B) Amount of Competitive Bid Borrowing ________________________
(C) [Maturity Date] [Interest Period] ________________________
(D) Interest Rate Basis ________________________
(E) Interest Payment Date(s) ________________________
(F) ___________________ ________________________
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed
Competitive Bid Borrowing:
(a) the representations and warranties contained in Section
4.01(a) through (i) of the Credit Agreement are correct, before and
after giving effect to the Proposed Competitive Bid Borrowing and to
the application of the proceeds therefrom, as though made on and as of
such date;
(b) no event has occurred and is continuing, or would result
from the Proposed Competitive Bid Borrowing or from the application of
the proceeds therefrom, that constitutes a Default;
(c) no event has occurred and no circumstance exists of which
the Borrower has become aware, as a result of which the information
concerning the Borrower that has been provided to the Agent and each
Lender by the Borrower in connection herewith is shown to contain an
untrue statement of a material fact or is shown to have omitted to
state any material fact or any fact necessary to make the statements
contained therein, in the light of the circumstances under which they
were made, not misleading as if the date such information was provided;
and.
(d) the aggregate amount of the Proposed Competitive Bid
Borrowing and all other Borrowings to be made on the same day under the
Credit Agreement is within the aggregate amount of the Unused
Commitments of the Lenders.
The undersigned hereby confirms that the Proposed Competitive
Bid Borrowing is to be made available to it in accordance with Section
2.03(a)(v) of the Credit Agreement.
Very truly yours,
RADIOSHACK CORPORATION
By __________________________
Title:
EXHIBIT C - FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the 364-Day Credit Agreement dated as of
June 19, 2002 (as amended or modified from time to time, the "Credit Agreement")
among Radioshack Corporation, a Delaware corporation (the "Borrower"), the
Lenders (as defined in the Credit Agreement), Bank of America, as administrative
agent, Fleet National Bank, as syndication agent, Wachovia Bank, National
Association, as documentation agent, Salomon Smith Barney Inc. and Banc of
America Securities Inc., as joint lead arrangers and bookrunners, and Citibank,
N.A., as agent for the Lenders (the "Agent"). Terms defined in the Credit
Agreement are used herein with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule I
hereto agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
and the Assignee hereby purchases and assumes from the Assignor, an interest in
and to the Assignor's rights and obligations under the Credit Agreement as of
the date hereof (other than in respect of Competitive Bid Advances and
Competitive Bid Notes) equal to the percentage interest specified on Schedule 1
hereto of all outstanding rights and obligations under the Credit Agreement
(other than in respect of Competitive Bid Advances and Competitive Bid Notes).
After giving effect to such sale and assignment, the Assignee's Commitment and
the amount of the Revolving Credit Advances owing to the Assignee will be as set
forth on Schedule 1 hereto.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of, or the perfection or priority of any lien
or security interest created or purported to be created under or in connection
with, the Credit Agreement or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Revolving Credit Note, if any, held by the Assignor [and
requests that the Agent exchange such Revolving Credit Note for a new Revolving
Credit Note payable to the order of [the Assignee in an amount equal to the
Commitment assumed by the Assignee pursuant hereto or new Revolving Credit Notes
payable to the order of the Assignee in an amount equal to the Commitment
assumed by the Assignee pursuant hereto and] the Assignor in an amount equal to
the Commitment retained by the Assignor under the Credit Agreement[,
respectively,] as specified on Schedule 1 hereto].
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor 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
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender; and (vi)
attaches any U.S. Internal Revenue Service forms required under Section 2.14 of
the Credit Agreement.
4. Following the execution of this Assignment and
Acceptance, it will be delivered to the Agent for acceptance and recording by
the Agent. The effective date for this Assignment and Acceptance (the "Effective
Date") shall be the date of acceptance hereof by the Agent, unless otherwise
specified on Schedule 1 hereto.
5. Upon such acceptance and recording by the Agent, as of
the Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Lender thereunder and (ii) the Assignor shall, to the
extent provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from
and after the Effective Date, the Agent shall make all payments under the Credit
Agreement and the Revolving Credit Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal, interest and
facility fees with respect thereto) to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments under the Credit Agreement
and the Revolving Credit Notes for periods prior to the Effective Date directly
between themselves.
7. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of New York.
8. This Assignment and Acceptance may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.
Schedule 1
to
Assignment and Acceptance
Percentage interest assigned: _____%
Assignee's Commitment: $______
Aggregate outstanding principal amount of Revolving Credit Advances assigned: $______
Principal amount of Revolving Credit Note payable to Assignee: $______
Principal amount of Revolving Credit Note payable to Assignor: $______
Effective Date*: _______________, 200_
[NAME OF ASSIGNOR], as Assignor
By __________________________
Title:
Dated: _______________, 200_
[NAME OF ASSIGNEE], as Assignee
By __________________________
Title:
Dated: _______________, 200_
Domestic Lending Office:
[Address]
Eurodollar Lending Office:
[Address]
------------------
* This date should be no earlier than five Business Days after the
delivery of this Assignment and Acceptance to the Agent.
Accepted [and Approved]** this
__________ day of _______________, 200_
CITIBANK, N.A., as Agent
By
------------------------------------------
Title:
[Approved this __________ day
of _______________, 200_
RADIOSHACK CORPORATION
By ]*
------------------------------------------
Title:
------------------
** Required if the Assignee is an Eligible Assignee solely by reason
of clause (iii) of the definition of "Eligible Assignee".
* Required if the Assignee is an Eligible Assignee solely by reason
of clause (iii) of the definition of "Eligible Assignee".
EXHIBIT D - FORM OF
OPINION OF COUNSEL
FOR THE BORROWER
[Effective Date]
To each of the Lenders parties
to the Credit Agreement dated
as of June 19, 2002
among Radioshack Corporation,
said Lenders and Citibank, N.A.,
as Agent for said Lenders, and
to Citibank, N.A., as Agent
Radioshack Corporation
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section
3.01(h)(iv) of the 364-Day Credit Agreement, dated as of June 19, 2002 (the
"Credit Agreement"), among Radioshack Corporation (the "Borrower"), the Lenders
parties thereto, Bank of America, as administrative agent, Fleet National Bank,
as syndication agent, Wachovia Bank, National Association, as documentation
agent, Salomon Smith Barney Inc. and Banc of America Securities Inc., as joint
lead arrangers and bookrunners, and Citibank, N.A., as Agent for said Lenders.
Terms defined in the Credit Agreement are used herein as therein defined.
We have acted as counsel for the Borrower in connection with
the preparation, execution and delivery of the Credit Agreement.
In that connection, we have examined:
(1) The Credit Agreement.
(2) The documents furnished by the Borrower pursuant to
Article III of the Credit Agreement.
(3) The [Articles] [Certificate] of Incorporation of the
Borrower and all amendments thereto (the "Charter").
(4) The by-laws of the Borrower and all amendments thereto
(the "By-laws").
(5) A certificate of the Secretary of State of Delaware, dated
_______________, 2002, attesting to the continued corporate existence
and good standing of the Borrower in that State.
We have also examined the originals, or copies certified to our satisfaction, of
the indentures, loan or credit agreements, leases, guarantees, mortgages,
security agreements, bonds, notes and other agreements or instruments, and
orders, writs, judgments, awards, injunctions and decrees, that affect or
purport to affect the Borrower's right to borrow money or the Borrower's
obligations under the Credit Agreement or the Notes. In addition, we have
examined the originals, or copies certified to our satisfaction, of such other
corporate records of the Borrower, certificates of public officials and of
officers of the Borrower, and agreements, instruments and other documents, as we
have deemed necessary as a basis for the opinions expressed below. As to
questions of fact material to such opinions, we have, when relevant facts were
not independently established by us, relied upon certificates of the Borrower or
its officers or of public officials. We have assumed the due execution and
delivery, pursuant to due authorization, of the Credit Agreement by the Initial
Lenders and the Agent.
Our opinions expressed below are limited to the law of the
State of Texas, the General Corporation Law of the State of Delaware and the
Federal law of the United States.
Based upon the foregoing and upon such investigation as we
have deemed necessary, we are of the following opinion:
1. The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
2. The execution, delivery and performance by the Borrower
of the Credit Agreement and the Notes, and the consummation of the
transactions contemplated thereby, are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action,
and do not contravene (i) the Charter or the By-laws or (ii) any law,
rule or regulation applicable to the Borrower (including, without
limitation, Regulation X of the Board of Governors of the Federal
Reserve System) or (iii) any contractual or legal restriction binding
on or affecting the Borrower. The Credit Agreement and the Notes have
been duly executed and delivered on behalf of the Borrower.
3. No authorization, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery
and performance by the Borrower of the Credit Agreement and the Notes.
4. To the best of our knowledge, there are no pending or
overtly threatened actions or proceedings against the Borrower or any
of its Subsidiaries before any court, governmental agency or arbitrator
that purport to affect the legality, validity, binding effect or
enforceability of the Credit Agreement or any of the Notes or the
consummation of the transactions contemplated thereby or that are
likely to have a materially adverse effect upon the financial condition
or operations of the Borrower or any of its Subsidiaries.
5. In any action or proceeding arising out of or relating
to the Credit Agreement or the Notes in any court of the State of Texas
or in any Federal court sitting in the State of Texas, such court would
recognize and give effect to the provisions of Section 8.09 of the
Credit Agreement wherein the parties thereto agree that the Credit
Agreement and the Notes shall be governed by, and construed in
accordance with, the laws of the State of New York. Without limiting
the generality of the foregoing, a court of the State of Texas or a
Federal court sitting in the State of Texas would apply the usury law
of the State of New York, and would not apply the usury law of the
State of Texas, to the Credit Agreement and the Notes. However, if a
court of the State of Texas or a Federal court sitting in the State of
Texas were to hold that the Credit Agreement and the Notes are governed
by, and to be construed in accordance with, the laws of the State of
Texas, the Credit Agreement and the Notes would be, under the laws of
the State of Texas, legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their
respective terms provided that the rate of interest charged under the
Credit Agreement and the Notes does not exceed the highest lawful rate
then in effect in the State of Texas, which rate is equal to twice the
rate of interest paid in respect of U.S. treasury bills, but is not
less than 18%, nor more than 28% per annum.
The opinions set forth above are subject to the following
qualifications:
(a) Our opinion in paragraph 5 above as to enforceability is
subject to the effect of any applicable bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar law affecting
creditors' rights generally.
(b) Our opinion in paragraph 5 above as to enforceability is
subject to the effect of general principles of equity, including,
without limitation, concepts of materiality, reasonableness, good faith
and fair dealing (regardless of whether considered in a proceeding in
equity or at law).
(c) We express no opinion as to (i) Section 2.14 of the
Credit Agreement insofar as it provides that any Lender purchasing a
participation from another Lender pursuant thereto may exercise set-off
or similar rights with respect to such participation and (ii) the
effect of the law of any jurisdiction other than the State of Texas
wherein any Lender may be located or wherein enforcement of the Credit
Agreement or the Notes may be sought that limits the rates of interest
legally chargeable or collectible.
Very truly yours,
EXECUTION COPY
U.S. $300,000,000
364-DAY CREDIT AGREEMENT
Dated as of June 19, 2002
Among
RADIOSHACK CORPORATION
as Borrower
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
and
CITIBANK, N.A.
as Administrative Agent and Paying Agent
and
BANK OF AMERICA, N.A.
as Administrative Agent
and
FLEET NATIONAL BANK
as Syndication Agent
and
WACHOVIA BANK, NATIONAL ASSOCIATION
as Documentation Agent
and
SALOMON SMITH BARNEY INC.
and
BANC OF AMERICA SECURITIES INC.
as Joint Lead Arrangers and Bookrunners
TABLE OF CONTENTS
ARTICLE I
SECTION 1.01. Certain Defined Terms 1
---------------------
SECTION 1.02. Computation of Time Periods 12
---------------------------
SECTION 1.03. Accounting Terms 12
----------------
ARTICLE II
SECTION 2.01. The Revolving Credit Advances 12
-----------------------------
SECTION 2.02. Making the Revolving Credit Advances 12
------------------------------------
SECTION 2.03. The Competitive Bid Advances 13
----------------------------
SECTION 2.04. Fees 16
----
SECTION 2.05. Termination or Reduction of the Commitments 16
-------------------------------------------
SECTION 2.06. Repayment of Revolving Credit Advances 16
--------------------------------------
SECTION 2.07. Interest on Revolving Credit Advances 16
-------------------------------------
SECTION 2.08. Interest Rate Determination 17
---------------------------
SECTION 2.09. Optional Conversion of Revolving Credit Advances 18
------------------------------------------------
SECTION 2.10. Prepayments of Revolving Credit Advances 18
----------------------------------------
SECTION 2.11. Increased Costs 18
---------------
SECTION 2.12. Illegality 18
----------
SECTION 2.13. Payments and Computations 19
-------------------------
SECTION 2.14. Taxes 20
-----
SECTION 2.15. Sharing of Payments, Etc. 21
------------------------
SECTION 2.16. Evidence of Debt 21
----------------
SECTION 2.17. Use of Proceeds 22
---------------
SECTION 2.18. Extension of Termination Date 22
-----------------------------
ARTICLE III
SECTION 3.01. Conditions Precedent to Effectiveness of
Sections 2.01 and 2.03 24
SECTION 3.02. Conditions Precedent to Each Revolving
--------------------------------------
Credit Borrowing and Extension Date. 25
-----------------------------------
SECTION 3.03. Conditions Precedent to Each Competitive
----------------------------------------
Bid Borrowing 25
-------------
SECTION 3.04. Determinations Under Section 3.01 26
---------------------------------
ARTICLE IV
SECTION 4.01. Representations and Warranties of the Borrower 26
ARTICLE V
SECTION 5.01. Affirmative Covenants 27
---------------------
SECTION 5.02. Negative Covenants 29
------------------
SECTION 5.03. Financial Covenants 31
-------------------
ARTICLE VI
SECTION 6.01. Events of Default 31
-----------------
ARTICLE VII
SECTION 7.01. Authorization and Action 33
------------------------
SECTION 7.02. Agent's Reliance, Etc. 33
---------------------
SECTION 7.03. Citibank and Affiliates 33
-----------------------
SECTION 7.04. Lender Credit Decision 33
----------------------
SECTION 7.05. Indemnification 34
---------------
SECTION 7.06. Successor Agent 34
---------------
SECTION 7.07. Other Agents. 34
-------------
ARTICLE VIII
SECTION 8.01. Amendments, Etc. 35
---------------
SECTION 8.02. Notices, Etc. 35
------------
SECTION 8.03. No Waiver; Remedies 35
-------------------
SECTION 8.04. Costs and Expenses 35
------------------
SECTION 8.05. Right of Set-off 36
----------------
SECTION 8.06. Binding Effect 36
--------------
SECTION 8.07. Assignments and Participations 36
------------------------------
SECTION 8.08. Confidentiality 38
---------------
SECTION 8.09. Governing Law 38
-------------
SECTION 8.10. Execution in Counterparts 39
-------------------------
SECTION 8.11. Jurisdiction, Etc. 39
-----------------
SECTION 8.13. Waiver of Jury Trial 40
--------------------
Schedules
---------
Schedule I - List of Applicable Lending Offices
Schedule 5.02(a) - Existing Liens
Schedule 5.02(e) - Existing Investments
Exhibits
--------
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Competitive Bid Note
Exhibit B-1 - Form of Notice of Revolving Credit Borrowing
Exhibit B-2 - Form of Notice of Competitive Bid Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Opinion of Counsel for the Borrower
EXHIBIT 10b
FIVE YEAR CREDIT AGREEMENT
Dated as of June 19, 2002
RADIOSHACK CORPORATION, a Delaware corporation (the
"Borrower"), the banks, financial institutions and other institutional lenders
(the "Initial Lenders") and issuers of letters of credit (the "Initial Issuing
Banks") listed on the signature pages hereof, BANK OF AMERICA, N.A., as
administrative agent, FLEET NATIONAL BANK, as syndication agent, WACHOVIA BANK,
NATIONAL ASSOCIATION, as documentation agent, SALOMON SMITH BARNEY INC. and BANC
OF AMERICA SECURITIES INC., as joint lead arrangers and bookrunners, and
CITIBANK, N.A. ("Citibank"), as administrative agent and as paying agent (the
"Agent") for the Lenders (as hereinafter defined), agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"Advance" means a Revolving Credit Advance or a Competitive Bid
Advance.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
For purposes of this definition, the term "control" (including the
terms "controlling", "controlled by" and "under common control with")
of a Person means the possession, direct or indirect, of the power to
vote 5% or more of the Voting Stock of such Person or to direct or
cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or
otherwise.
"Agent's Account" means the account of the Agent maintained by
the Agent at Citibank at its office at 388 Greenwich Street, New York,
New York 10013, Account No. 36852248, Attention: Bank Loan
Syndications.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case of
a Eurodollar Rate Advance and, in the case of a Competitive Bid
Advance, the office of such Lender notified by such Lender to the Agent
as its Applicable Lending Office with respect to such Competitive Bid
Advance.
"Applicable Margin" means (a) for Base Rate Advances, 0% per
annum and (b) for Eurodollar Rate Advances, as of any date, a
percentage per annum determined by reference to the Borrower's Rating
Level in effect on such date as set forth below:
-------------------------- -----------------------------
Rating Level Applicable Margin for
Eurodollar Rate Advances
-------------------------- -----------------------------
Level 1
A/A2/A or above 0.195%
-------------------------- -----------------------------
Level 2
A-/A3/A- 0.300%
-------------------------- -----------------------------
Level 3
BBB+/Baa1/BBB+ 0.500%
-------------------------- -----------------------------
Level 4
BBB/Baa2/BBB 0.600%
-------------------------- -----------------------------
Level 5
Lower than Level 4 0.800%
-------------------------- -----------------------------
"Applicable Percentage" means, as of any date a percentage per
annum determined by reference to the Borrower's Rating Level in effect
on such date as set forth below:
-------------------------- -----------------------------
Rating Level Applicable
Percentage
-------------------------- -----------------------------
Level 1
A/A2/A or above 0.080%
-------------------------- -----------------------------
Level 2
A-/A3/A- 0.100%
-------------------------- -----------------------------
Level 3
BBB+/Baa1/BBB+ 0.125%
-------------------------- -----------------------------
Level 4
BBB/Baa2/BBB 0.150%
-------------------------- -----------------------------
Level 5
Lower than Level 4 0.200%
-------------------------- -----------------------------
"Applicable Utilization Fee" means, as of any date that the
sum of the aggregate Advances plus the Available Amount of all Letters
of Credit exceeds 33 1/3% of the aggregate Revolving Credit
Commitments, a percentage per annum determined by reference to the
Borrower's Rating Level in effect on such date as set forth below:
-------------------------- -----------------------------
Rating Level Applicable
Utilization Fee
-------------------------- -----------------------------
Level 1
A/A2/A or above 0.050%
-------------------------- -----------------------------
-------------------------- -----------------------------
Level 2
A-/A3/A- 0.100%
-------------------------- -----------------------------
Level 3
BBB+/Baa1/BBB+ 0.125%
-------------------------- -----------------------------
Level 4
BBB/Baa2/BBB 0.125%
-------------------------- -----------------------------
Level 5
Lower than Level 4 0.250%
-------------------------- -----------------------------
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Agent, in substantially the form of Exhibit C hereto.
"Assuming Lender" has the meaning specified in Section
2.19(c).
"Assumption Agreement" has the meaning specified in Section
2.19(c).
"Available Amount" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of Credit at
such time (assuming compliance at such time with all conditions to
drawing).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the highest of:
(a) the rate of interest announced publicly by
Citibank in New York, New York, from time to time, as
Citibank's base rate;
(b) the sum (adjusted to the nearest 1/4 of 1% or,
if there is no nearest 1/4 of 1%, to the next higher 1/4 of 1%)
of (i) 1/2 of 1% per annum, plus (ii) the rate obtained by
dividing (A) the latest three-week moving average of secondary
market morning offering rates in the United States for
three-month certificates of deposit of major United States
money market banks, such three-week moving average (adjusted
to the basis of a year of 360 days) being determined weekly on
each Monday (or, if such day is not a Business Day, on the
next succeeding Business Day) for the three-week period ending
on the previous Friday by Citibank on the basis of such rates
reported by certificate of deposit dealers to and published by
the Federal Reserve Bank of New York or, if such publication
shall be suspended or terminated, on the basis of quotations
for such rates received by Citibank from three New York
certificate of deposit dealers of recognized standing selected
by Citibank, by (B) a percentage equal to 100% minus the
average of the daily percentages specified during such
three-week period by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, but not limited to, any
emergency, supplemental or other marginal reserve requirement)
for Citibank with respect to liabilities consisting of or
including (among other liabilities) three-month U.S. dollar
non-personal time deposits in the United States, plus (iii)
the average during such three-week period of the annual
assessment rates estimated by Citibank for determining the
then current annual assessment payable by Citibank to the
Federal Deposit Insurance Corporation (or any successor) for
insuring U.S. dollar deposits of Citibank in the United
States; and
(c) 1/2 of one percent per annum above the Federal
Funds Rate.
"Base Rate Advance" means a Revolving Credit Advance that
bears interest as provided in Section 2.08(a)(i).
"Borrowing" means a Revolving Credit Borrowing or a Competitive
Bid Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the
applicable Business Day relates to any Eurodollar Rate Advances or LIBO
Rate Advances, on which dealings are carried on in the London interbank
market.
"Capital Lease" means any lease required to be accounted for
as a capital lease.
"Commitment" means a Revolving Credit Commitment or a Letter of
Credit Commitment.
"Competitive Bid Advance" means an advance by a Lender to the
Borrower as part of a Competitive Bid Borrowing resulting from the
competitive bidding procedure described in Section 2.03 and refers to a
Fixed Rate Advance or a LIBO Rate Advance.
"Competitive Bid Borrowing" means a borrowing consisting of
simultaneous Competitive Bid Advances from each of the Lenders whose
offer to make one or more Competitive Bid Advances as part of such
borrowing has been accepted under the competitive bidding procedure
described in Section 2.03.
"Competitive Bid Note" means a promissory note of the Borrower
payable to the order of any Lender, in substantially the form of
Exhibit A-2 hereto, evidencing the indebtedness of the Borrower to such
Lender resulting from a Competitive Bid Advance made by such Lender.
"Confidential Information" means information that the Borrower
furnishes to the Agent or any Lender in a writing designated as
confidential, but does not include any such information that is or
becomes generally available to the public or that is or becomes
available to the Agent or such Lender from a source other than the
Borrower.
"Consenting Lender" has the meaning specified in Section
2.19(b).
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Consolidated EBITDA" means, for any period, for the Borrower
and its Subsidiaries, calculated on a Consolidated basis, the sum of
(without duplication) the following: (a) Pretax Net Income (excluding
therefrom, to the extent included in determining Pretax Net Income, any
items of extraordinary gain, including net gains on the sale of assets
other than asset sales in the ordinary course of business, and adding
thereto, to the extent included in determining Pretax Net Income, any
items of extraordinary loss, including net losses on the sale of assets
other than asset sales in the ordinary course of business), plus (b) to
the extent included in determining Pretax Net Income, interest expense
(including interest expense in respect of Capital Leases), plus (c) to
the extent included in determining Pretax Net Income, depreciation and
amortization and other non-cash charges, minus (d) to the extent
included in determining Pretax Net Income, non-cash credits.
"Consolidated EBITDAR" means, for any period, for the Borrower
and its Subsidiaries, calculated on a Consolidated basis, the sum of
(without duplication) the following: (a) Consolidated EBITDA plus (b)
to the extent included in determining Pretax Net Income, rental expense
(including rental expense in respect of Capital Leases).
"Consolidated Funded Debt" means, at any date, for the
Borrower and its Subsidiaries on a Consolidated basis, Debt of the
types described in clauses (a), (b), (c) and (e) of the definition of
"Debt".
"Consolidated Tangible Net Worth" means, at any time, the
total Consolidated stockholders' equity less the total amount of
Consolidated intangible assets and plus the total amount of any
subordinated indebtedness unless already included in stockholders'
equity, in each case calculated for the Borrower and its Subsidiaries
taken as a whole. Intangible assets shall include unamortized debt
discount and expense, unamortized deferred charges and goodwill.
"Convert", "Conversion" and "Converted" each refers to a
conversion of Revolving Credit Advances of one Type into Revolving
Credit Advances of the other Type pursuant to Section 2.09 or 2.10.
"Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of property or services
(other than trade payables not overdue by more than 60 days incurred in
the ordinary course of such Person's business), (c) all obligations of
such Person evidenced by notes, bonds, debentures or other similar
instruments, (d) all obligations of such Person created or arising
under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property), (e) all
obligations of such Person as lessee under Capital Leases, (f) all
obligations, contingent or otherwise, of such Person in respect of
acceptances, letters of credit or similar extensions of credit, (g) all
obligations of such Person in respect of Hedge Agreements, (h) all Debt
of others referred to in clauses (a) through (g) above or clause (i)
below and other payment obligations guaranteed directly or indirectly
in any manner by such Person, or in effect guaranteed directly or
indirectly by such Person through an agreement (1) to pay or purchase
such Debt or to advance or supply funds for the payment or purchase of
such Debt, (2) to purchase, sell or lease (as lessee or lessor)
property, or to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such Debt or to assure the
holder of such Debt against loss, (3) to supply funds to or in any
other manner invest in the debtor (including any agreement to pay for
property or services irrespective of whether such property is received
or such services are rendered) or (4) otherwise to assure a creditor
against loss, and (i) all Debt referred to in clauses (a) through (h)
above secured by (or for which the holder of such Debt has an existing
right, contingent or otherwise, to be secured by) any Lien on property
(including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable
for the payment of such Debt.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"Domestic Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assumption Agreement
or the Assignment and Acceptance pursuant to which it became a Lender,
or such other office of such Lender as such Lender may from time to
time specify to the Borrower and the Agent.
"Effective Date" has the meaning specified in Section 3.01.
"Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
Lender and (iii) any other Person approved by the Agent and, unless an
Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 8.07, the Borrower,
such approval not to be unreasonably withheld or delayed; provided,
however, that neither the Borrower nor an Affiliate of the Borrower
shall qualify as an Eligible Assignee.
"Environmental Action" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental
Law, Environmental Permit or Hazardous Materials or arising from
alleged injury or threat of injury to health, safety or the
environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response,
remedial or other actions or damages and (b) by any governmental or
regulatory authority or any third party for damages, contribution,
indemnification, cost recovery, compensation or injunctive relief.
"Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, judgment,
decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health, safety
or natural resources, including, without limitation, those relating to
the use, handling, transportation, treatment, storage, disposal,
release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title
IV of ERISA is a member of the Borrower's controlled group, or under
common control with the Borrower, within the meaning of Section 414 of
the Internal Revenue Code.
"ERISA Event" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event
has been waived by the PBGC, or (ii) the requirements of subsection (1)
of Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of the Borrower or any ERISA Affiliate in
the circumstances described in Section 4062(e) of ERISA; (e) the
withdrawal by the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions
for the imposition of a lien under Section 302(f) of ERISA shall have
been met with respect to any Plan; (g) the adoption of an amendment to
a Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA; or (h) the institution by the PBGC of proceedings
to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA
that constitutes grounds for the termination of, or the appointment of
a trustee to administer, a Plan.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assumption Agreement
or the Assignment and Acceptance pursuant to which it became a Lender
(or, if no such office is specified, its Domestic Lending Office), or
such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Agent.
"Eurodollar Rate" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same Revolving Credit
Borrowing, an interest rate per annum equal to the rate per annum
obtained by dividing (a) the rate per annum (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum) appearing on Telerate
Markets Page 3750 (or any successor page) as the London interbank
offered rate for deposits in U.S. dollars at approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period or, if for any
reason such rate is not available, the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not
such a multiple) of the rate per annum at which deposits in U.S.
dollars are offered by the principal office of each of the Reference
Banks in London, England to prime banks in the London interbank market
at 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to such Reference
Bank's Eurodollar Rate Advance comprising part of such Revolving Credit
Borrowing to be outstanding during such Interest Period and for a
period equal to such Interest Period by (b) a percentage equal to 100%
minus the Eurodollar Rate Reserve Percentage for such Interest Period.
If the Telerate Markets Page 3750 (or any successor page) is
unavailable, the Eurodollar Rate for any Interest Period for each
Eurodollar Rate Advance comprising part of the same Revolving Credit
Borrowing shall be determined by the Agent on the basis of applicable
rates furnished to and received by the Agent from the Reference Banks
two Business Days before the first day of such Interest Period,
subject, however, to the provisions of Section 2.09.
"Eurodollar Rate Advance" means a Revolving Credit Advance
that bears interest as provided in Section 2.08(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period
for all Eurodollar Rate Advances or LIBO Rate Advances comprising part
of the same Borrowing means the reserve percentage applicable two
Business Days before the first day of such Interest Period under
regulations issued from time to time by the Board of Governors of the
Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for a member bank
of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency
Liabilities (or with respect to any other category of liabilities that
includes deposits by reference to which the interest rate on Eurodollar
Rate Advances or LIBO Rate Advances is determined) having a term equal
to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Extension Date" has the meaning specified in Section 2.19(b).
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by the Agent.
"Fitch" means Fitch, Inc.
"Fixed Rate Advances" has the meaning specified in Section
2.03(a)(i).
"GAAP" has the meaning specified in Section 1.03.
"Hazardous Materials" means (a) petroleum and petroleum
products, byproducts or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas
and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"Information Memorandum" means the information memorandum
dated May 14, 2002 used by the Agent in connection with the syndication
of the Commitments.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Revolving Credit Borrowing and each LIBO
Rate Advance comprising part of the same Competitive Bid Borrowing, the
period commencing on the date of such Eurodollar Rate Advance or LIBO
Rate Advance or the date of the Conversion of any Base Rate Advance
into such Eurodollar Rate Advance and ending on the last day of the
period selected by the Borrower pursuant to the provisions below and,
thereafter, with respect to Eurodollar Rate Advances, each subsequent
period commencing on the last day of the immediately preceding Interest
Period and ending on the last day of the period selected by the
Borrower pursuant to the provisions below. The duration of each such
Interest Period shall be one, two, three or six months, as the Borrower
may, upon notice received by the Agent not later than 12:00 noon (New
York City time) on the third Business Day prior to the first day of
such Interest Period, select; provided, however, that:
(a) the Borrower may not select any Interest
Period that ends after the Termination Date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Revolving
Credit Borrowing or for LIBO Rate Advances comprising part of
the same Competitive Bid Borrowing shall be of the same
duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided, however, that, if
such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the next preceding
Business Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Issuing Bank" means each Initial Issuing Bank or any Eligible
Assignee to which a portion of the Letter of Credit Commitment
hereunder has been assigned pursuant to Section 8.07 so long as such
Eligible Assignee expressly agrees to perform in accordance with their
terms all of the obligations that by the terms of this Agreement are
required to be performed by it as an Issuing Bank and notifies the
Agent of its Applicable Lending Office (which information shall be
recorded by the Agent in the Register), for so long as such Initial
Issuing Bank or Eligible Assignee, as the case may be, shall have a
Letter of Credit Commitment.
"Investment" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any capital stock,
warrants, rights, options, obligations or other securities or all or
substantially all of the assets of such Person, any capital
contribution to such Person or any other investment in such Person,
including, without limitation, any arrangement pursuant to which the
investor incurs Debt of the types referred to in clauses (h) and (i) of
the definition of "Debt" in respect of such Person.
"L/C Cash Collateral Account" means an interest bearing cash
collateral account to be established and maintained by the Agent, over
which the Agent shall have sole dominion and control, upon terms as may
be satisfactory to the Agent.
"L/C Related Documents" has the meaning specified in
Section 2.08(b)(i).
"Lenders" means the Initial Lenders, the Issuing Banks, each
Assuming Lender that shall become a party hereto pursuant to Section
2.19 and each Person that shall become a party hereto pursuant to
Section 8.07.
"Letter of Credit" has the meaning specified in
Section 2.01(b).
"Letter of Credit Agreement" has the meaning specified in
Section 2.04(a).
"Letter of Credit Commitment" means, with respect to each
Initial Issuing Bank, the amount set forth opposite such Initial
Issuing Bank's name on the signature pages hereto under the caption
"Letter of Credit Commitment" or, if such Initial Issuing Bank has
entered into one or more Assignment and Acceptances, the amount set
forth for such Issuing Bank in the Register maintained by the Agent
pursuant to Section 8.07(d) as such Issuing Bank's "Letter of Credit
Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.07.
"Letter of Credit Facility" means, at any time, an amount
equal to the lesser of (a) the amount of the Issuing Banks' Letter of
Credit Commitments at such time and (b) $100,000,000, as such amount
may be reduced at or prior to such time pursuant to Section 2.07.
"LIBO Rate" means, for any Interest Period for all LIBO Rate
Advances comprising part of the same Competitive Bid Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the rate per annum (rounded upward to the nearest whole
multiple of 1/16 of 1% per annum) appearing on Telerate Markets Page
3750 (or any successor page) as the London interbank offered rate for
deposits in U.S. dollars at approximately 11:00 A.M. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period or, if for any reason such rate is
not available, the average (rounded upward to the nearest whole
multiple of 1/16 of 1% per annum, if such average is not such a
multiple) of the rate per annum at which deposits in U.S. dollars
offered by the principal office of each of the Reference Banks in
London, England to prime banks in the London interbank market at 11:00
A.M. (London time) two Business Days before the first day of such
Interest Period in an amount substantially equal to the amount that
would be the Reference Banks' respective ratable shares of such
Borrowing if such Borrowing were to be a Revolving Credit Borrowing to
be outstanding during such Interest Period and for a period equal to
such Interest Period by (b) a percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage for such Interest Period. If the
Telerate Markets Page 3750 (or any successor page) is unavailable, the
LIBO Rate for any Interest Period for each LIBO Rate Advance comprising
part of the same Competitive Bid Borrowing shall be determined by the
Agent on the basis of applicable rates furnished to and received by the
Agent from the Reference Banks two Business Days before the first day
of such Interest Period, subject, however, to the provisions of Section
2.09.
"LIBO Rate Advance" means a Competitive Bid Advance bearing
interest based on the LIBO Rate.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"Marketable Securities" means any of the following, to the
extent owned by the Borrower or any of its Subsidiaries free and clear
of all Liens and having a maturity of not greater than 360 days from
the date of acquisition thereof: (a) readily marketable direct
obligations of the Government of the United States or any agency or
instrumentality thereof or obligations unconditionally guaranteed by
the full faith and credit of the Government of the United States, (b)
certificates of deposit of or time deposits with any commercial bank
that is a Lender or a member of the Federal Reserve System, issues (or
the parent of which issues) commercial paper rated as described in
clause (c), is organized or licensed under the laws of the United
States or any State thereof and has combined capital and surplus of at
least $1 billion, (c) commercial paper in an aggregate amount of no
more than $10,000,000 per issuer outstanding at any time, issued by any
corporation organized under the laws of any State of the United States
and rated at least "Prime-1" (or the then equivalent grade) by Moody's,
"A-1" (or the then equivalent grade) by S&P or F-1 (or the then
equivalent grade) by Fitch or (d) money market mutual funds with a
minimum of $500,000,000 net asset value rated at least Aaa by Moody's,
AAA by S&P or AAA by Fitch.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower or the Borrower
and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower or the Borrower
and its Subsidiaries taken as a whole, (b) the rights and remedies of
the Agent or any Lender under this Agreement or any Note or (c) the
ability of the Borrower to perform its obligations under this Agreement
or any Note.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of the Borrower or any ERISA Affiliate and at least one
Person other than the Borrower and the ERISA Affiliates or (b) was so
maintained and in respect of which the Borrower or any ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.
"Non-Consenting Lender" has the meaning specified in
Section 2.19(b).
"Note" means a Revolving Credit Note or a Competitive Bid Note.
"Notice of Competitive Bid Borrowing" has the meaning
specified in Section 2.03(a).
"Notice of Revolving Credit Borrowing" has the meaning
specified in Section 2.02(a).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b) hereof; (b) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's Liens
and other similar Liens arising in the ordinary course of business
securing obligations that are not overdue for a period of more than 90
days; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations; and (d) easements, rights of way and other
encumbrances on title to real property that do not render title to the
property encumbered thereby unmarketable or materially adversely affect
the use of such property for its present purposes.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture, limited liability company or
other entity, or a government or any political subdivision or agency
thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pretax Net Income" means, for any period, net income (or
loss) before taxes of the Borrower and its Subsidiaries, on a
Consolidated basis for such period taken as a single accounting period,
excluding, however, net income (or loss) attributable to any Person
(other than the Borrower or any of its Subsidiaries) in which the
Borrower or any of its Subsidiaries has a minority interest, except to
the extent of the amount of cash dividends or other cash distributions
actually paid to the Borrower or such Subsidiary by such other Person.
"Pro Rata Share" of any amount means, with respect to any
Lender at any time, the product of such amount times a fraction the
numerator of which is the amount of such Lender's Revolving Credit
Commitment at such time (or, if the Revolving Credit Commitments shall
have been terminated pursuant to Section 2.07 or 6.01, such Lender's
Revolving Credit Commitment as in effect immediately prior to such
termination) and the denominator of which is the aggregate amount of
all Revolving Credit Commitments at such time (or, if the Revolving
Credit Commitments shall have been terminated pursuant to Section 2.07
or 6.01, the aggregate amount of all Revolving Credit Commitments as in
effect immediately prior to such termination).
"Public Debt Rating" means, as of any date, the rating that
has been most recently announced by either S&P, Moody's or Fitch, as
the case may be, for any class of non-credit enhanced long-term senior
unsecured debt issued by the Borrower or, if any such rating agency
shall have issued more than one such rating, the lowest such rating
issued by such rating agency. For purposes of the foregoing, (a) if
only one of S&P, Moody's or Fitch shall have in effect a Public Debt
Rating, the Applicable Margin, the Applicable Percentage and the
Applicable Utilization Fee shall be determined by reference to the
available rating; (b) if none of S&P, Moody's or Fitch shall have in
effect a Public Debt Rating, the Applicable Margin, the Applicable
Percentage and the Applicable Utilization Fee will be set in accordance
with Level 5 under the definition of "Applicable Margin", "Applicable
Percentage" or "Applicable Utilization Fee", as the case may be; (c) if
only two of S&P, Moody's or Fitch shall have in effect a Public Debt
Rating, the Applicable Margin, the Applicable Percentage and the
Applicable Utilization Fee shall be determined by reference to the
higher rating unless such ratings differ by two or more levels, in
which case the applicable level will be deemed to be one level below
the higher of such levels, (d) if the ratings established by S&P,
Moody's and Fitch shall fall within different levels, and two of the
three are within the same level, the Applicable Margin, the Applicable
Percentage and the Applicable Utilization Fee shall be based upon the
rating of those two such agencies and the ratings of no two agencies
fall within the same level, the rating of the agency that is neither
the highest nor the lowest shall apply and the Applicable, Margin, the
Applicable Percentage and the Applicable Utilization Fee shall be based
upon the rating of that agency; (e) if any rating established by S&P,
Moody's or Fitch shall be changed, such change shall be effective as of
the date on which such change is first announced publicly by the rating
agency making such change; and (f) if S&P, Moody's or Fitch shall
change the basis on which ratings are established, each reference to
the Public Debt Rating announced by S&P, Moody's or Fitch, as the case
may be, shall refer to the then equivalent rating by S&P, Moody's or
Fitch, as the case may be.
"Rating Level" means, as of any date of determination, the
numerically lowest level set forth below as then in effect, as
determined in accordance with the following provisions of this
definition:
Level 1 The Public Debt Rating is A, A2 or A or better by
two of S&P, Moody's and Fitch, respectively;
Level 2 The Public Debt Rating is A-, A3 or A- by two of S&P,
Moody's and Fitch, respectively;
Level 3 The Public Debt Rating is BBB+, Baa1 or BBB+ by
two of S&P, Moody's and Fitch, respectively;
Level 4 The Public Debt Rating is BBB, Baa2 or BBB by
two of S&P, Moody's and Fitch, respectively;
Level 5 The Public Debt Rating is lower than Level 4.
"Reference Banks" means Citibank, Bank of America, N.A. and
Fleet National Bank.
"Register" has the meaning specified in Section 8.07(d).
"Required Lenders" means at any time Lenders owed at least a
majority in interest of the then aggregate unpaid principal amount of
the Revolving Credit Advances owing to Lenders or, if no such principal
amount is then outstanding, Lenders having at least a majority in
interest of the Revolving Credit Commitments.
"Revolving Credit Advance" means an advance by a Lender to the
Borrower as part of a Revolving Credit Borrowing and refers to a Base
Rate Advance or a Eurodollar Rate Advance (each of which shall be a
"Type" of Revolving Credit Advance).
"Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by each of
the Lenders pursuant to Section 2.01.
"Revolving Credit Commitment" means, with respect to any
Lender at any time, the amount set forth opposite such Lender's name on
the signature pages hereto under the caption "Revolving Credit
Commitment" or, if such Lender has entered into one or more Assignment
and Acceptances, set forth for such Lender in the Register maintained
by the Agent pursuant to Section 8.07(d) as such Lender's "Revolving
Credit Commitment", as such amount may be reduced at or prior to such
time pursuant to Section 2.06.
"Revolving Credit Note" means a promissory note of the
Borrower payable to the order of any Lender, delivered pursuant to a
request made under Section 2.17 in substantially the form of Exhibit
A-1 hereto, evidencing the aggregate indebtedness of the Borrower to
such Lender resulting from the Revolving Credit Advances made by such
Lender.
"S&P" means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc.
"Single Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of the Borrower or any ERISA Affiliate and no Person other
than the Borrower and the ERISA Affiliates or (b) was so maintained and
in respect of which the Borrower or any ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been
or were to be terminated.
"Subsidiary" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
or might have voting power upon the occurrence of any contingency), (b)
the interest in the capital or profits of such limited liability
company, partnership or joint venture or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"Termination Date" means the earlier of (a) June 19, 2007,
subject to the extension thereof pursuant to Section 2.19 and (b) the
date of termination in whole of the Commitments pursuant to Section
2.06 or 6.01; provided, however, that the Termination Date of any
Lender that is a Non-Consenting Lender to any requested extension
pursuant to Section 2.19 shall be the Termination Date in effect
immediately prior to the applicable Extension Date for all purposes of
this Agreement.
"Unused Commitment" means, with respect to each Lender at any
time, (a) such Lender's Revolving Credit Commitment at such time minus
(b) the sum of (i) the aggregate principal amount of all Revolving
Credit Advances made by such Lender (in its capacity as a Lender) and
outstanding at such time, plus (ii) such Lender's Pro Rata Share of (A)
the aggregate Available Amount of all the Letters of Credit outstanding
at such time, (B) the aggregate principal amount of all Revolving
Credit Advances made by each Issuing Bank pursuant to Section 2.04(c)
that have not been ratably funded by such Lender and outstanding at
such time and (C) the aggregate principal amount of Competitive Bid
Advances then outstanding.
"Usage" means, at any time the sum of the aggregate principal
amount of the Advances then outstanding plus the Available Amount of
the outstanding Letters of Credit.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the
happening of such a contingency.
SECTION 1.02. Computation of Time Periods. In this Agreement
in the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including" and the words
"to" and "until" each mean "to but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with
generally accepted accounting principles consistent with those applied
in the preparation of the financial statements referred to in
Section 4.01(e) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Revolving Credit Advances and Letters of
Credit. (a) Revolving Credit Advances. Each Lender severally agrees, on the
terms and conditions hereinafter set forth, to make Revolving Credit Advances to
the Borrower from time to time on any Business Day during the period from the
Effective Date until the Termination Date in an aggregate amount not to exceed
at any time such Lender's Unused Commitment at such time. Each Revolving Credit
Borrowing shall be in an aggregate amount of $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and shall consist of Revolving Credit Advances
of the same Type made on the same day by the Lenders ratably according to their
respective Revolving Credit Commitments. Within the limits of each Lender's
Revolving Credit Commitment, the Borrower may borrow under this Section 2.01,
prepay pursuant to Section 2.11 and reborrow under this Section 2.01.
(b) Letters of Credit. Each Issuing Bank agrees, on the
terms and conditions hereinafter set forth, in reliance upon the agreements of
the other Lenders set forth in this Agreement, to issue letters of credit (each,
a "Letter of Credit") for the account of the Borrower from time to time on any
Business Day during the period from the Effective Date until 30 days before the
Termination Date in an aggregate Available Amount (i) for all Letters of Credit
issued by each Issuing Bank not to exceed at any time the lesser of (x) the
Letter of Credit Facility at such time and (y) such Issuing Bank's Letter of
Credit Commitment at such time and (ii) for each such Letter of Credit not to
exceed an amount equal to the Unused Commitments of the Lenders at such time. No
Letter of Credit shall have an expiration date (including all rights of the
Borrower or the beneficiary to require renewal) later than 10 Business Days
before the Termination Date. Within the limits referred to above, the Borrower
may request the issuance of Letters of Credit under this Section 2.01(b), repay
any Revolving Credit Advances resulting from drawings thereunder pursuant to
Section 2.04(c) and request the issuance of additional Letters of Credit under
this Section 2.01(b).
SECTION 2.02. Making the Revolving Credit Advances. (a) Each
Revolving Credit Borrowing shall be made on notice, given not later than (x)
12:00 noon (New York City time) on the third Business Day prior to the date of
the proposed Revolving Credit Borrowing in the case of a Revolving Credit
Borrowing consisting of Eurodollar Rate Advances or (y) 12:00 noon (New York
City time) on the date of the proposed Revolving Credit Borrowing in the case of
a Revolving Credit Borrowing consisting of Base Rate Advances, by the Borrower
to the Agent, which shall give to each Lender prompt notice thereof by
telecopier or telex. Each such notice of a Revolving Credit Borrowing (a "Notice
of Revolving Credit Borrowing") shall be by telephone, confirmed immediately in
writing, or telecopier or telex in substantially the form of Exhibit B-1 hereto,
specifying therein the requested (i) date of such Revolving Credit Borrowing,
(ii) Type of Advances comprising such Revolving Credit Borrowing, (iii)
aggregate amount of such Revolving Credit Borrowing, and (iv) in the case of a
Revolving Credit Borrowing consisting of Eurodollar Rate Advances, initial
Interest Period for each such Revolving Credit Advance. Each Lender shall,
before 1:00 P.M. (New York City time) on the date of such Revolving Credit
Borrowing make available for the account of its Applicable Lending Office to the
Agent at the Agent's Account, in same day funds, such Lender's ratable portion
of such Revolving Credit Borrowing. After the Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in Article III, the
Agent will make such funds available to the Borrower at the Agent's address
referred to in Section 8.02.
(b) Anything in subsection (a) above to the contrary
notwithstanding, the Borrower may not select Eurodollar Rate Advances for any
Revolving Credit Borrowing if the aggregate amount of such Revolving Credit
Borrowing is less than $5,000,000 or if the obligation of the Lenders to make
Eurodollar Rate Advances shall then be suspended pursuant to Section 2.09 or
2.13.
(c) Each Notice of Revolving Credit Borrowing shall be
irrevocable and binding on the Borrower. In the case of any Revolving Credit
Borrowing that the related Notice of Revolving Credit Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Revolving Credit Borrowing for such Revolving Credit Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Revolving Credit
Advance to be made by such Lender as part of such Revolving Credit Borrowing
when such Revolving Credit Advance, as a result of such failure, is not made on
such date. The loss of a Lender shall include an amount equal to the excess, if
any, as reasonably determined by such Lender of (A) its cost of obtaining funds
for the Revolving Credit Advance not borrowed, to the last day of the Interest
Period for such Revolving Credit Advance which would have commenced on the date
of such failure to borrow over (B) the amount of interest (as reasonably
determined by such Lender) that could be realized by such Lender in reemploying
during such period the funds not borrowed.
(d) Unless the Agent shall have received notice from a
Lender prior to the time of any Revolving Credit Borrowing that such Lender will
not make available to the Agent such Lender's ratable portion of such Revolving
Credit Borrowing, the Agent may assume that such Lender has made such portion
available to the Agent on the date of such Revolving Credit Borrowing in
accordance with subsection (a) of this Section 2.02 and the 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 Lender shall not have so
made such ratable portion available to the Agent, such Lender and the Borrower
severally agree to repay to the 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
Agent, at (i) in the case of the Borrower, the interest rate applicable at the
time to Revolving Credit Advances comprising such Revolving Credit Borrowing and
(ii) in the case of such Lender, the Federal Funds Rate. If such Lender shall
repay to the Agent such corresponding amount, such amount so repaid shall
constitute such Lender's Revolving Credit Advance as part of such Revolving
Credit Borrowing for purposes of this Agreement.
(e) The failure of any Lender to make the Revolving Credit
Advance to be made by it as part of any Revolving Credit Borrowing shall not
relieve any other Lender of its obligation hereunder to make its Revolving
Credit Advance on the date of such Revolving Credit Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Revolving
Credit Advance to be made by such other Lender on the date of any Revolving
Credit Borrowing.
SECTION 2.03. The Competitive Bid Advances. (a) Each Lender
severally agrees that the Borrower may make Competitive Bid Borrowings under
this Section 2.03 from time to time on any Business Day during the period from
the date hereof until the date occurring 30 days prior to the Termination Date
in the manner set forth below; provided that, following the making of each
Competitive Bid Borrowing, the Usage shall not exceed the aggregate amount of
the Revolving Credit Commitments of the Lenders.
(i) The Borrower may request a Competitive Bid Borrowing
under this Section 2.03 by delivering to the Agent, by telecopier or
telex, a notice of a Competitive Bid Borrowing (a "Notice of Competitive
Bid Borrowing"), in substantially the form of Exhibit B-2 hereto,
specifying therein the requested (v) date of such proposed Competitive
Bid Borrowing, (w) aggregate amount of such proposed Competitive Bid
Borrowing, (x) in the case of a Competitive Bid Borrowing consisting of
LIBO Rate Advances, Interest Period, or in the case of a Competitive
Bid Borrowing consisting of Fixed Rate Advances, maturity date for
repayment of each Fixed Rate Advance to be made as part of such
Competitive Bid Borrowing (which maturity date may not be earlier than
the date occurring 7 days after the date of such Competitive Bid
Borrowing or later than the earlier of (I) 180 days after the date of
such Competitive Bid Borrowing and (II) the Termination Date), (y)
interest payment date or dates relating thereto, and (z) other terms
(if any) to be applicable to such Competitive Bid Borrowing, not later
than 11:00 A.M. (New York City time) (A) at least one Business Day
prior to the date of the proposed Competitive Bid Borrowing, if the
Borrower shall specify in the Notice of Competitive Bid Borrowing that
the rates of interest to be offered by the Lenders shall be fixed rates
per annum (the Advances comprising any such Competitive Bid Borrowing
being referred to herein as "Fixed Rate Advances") and (B) at least
four Business Days prior to the date of the proposed Competitive Bid
Borrowing, if the Borrower shall instead specify in the Notice of
Competitive Bid Borrowing that the Advances comprising such Competitive
Bid Borrowing shall be LIBO Rate Advances. Each Notice of Competitive
Bid Borrowing shall be irrevocable and binding on the Borrower. The
Agent shall in turn promptly notify each Lender of each request for a
Competitive Bid Borrowing received by it from the Borrower by sending
such Lender a copy of the related Notice of Competitive Bid Borrowing.
(ii) Each Lender may, if, in its sole discretion, it elects
to do so, irrevocably offer to make one or more Competitive Bid Advances
to the Borrower as part of such proposed Competitive Bid Borrowing at a
rate or rates of interest specified by such Lender in its sole
discretion, by notifying the Agent (which shall give prompt notice
thereof to the Borrower), (A) before 10:30 A.M. (New York City time) on
the date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of Fixed Rate Advances and (B)
before 11:00 A.M. (New York City time) three Business Days before the
date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of LIBO Rate Advances, of the
minimum amount and maximum amount of each Competitive Bid Advance which
such Lender would be willing to make as part of such proposed
Competitive Bid Borrowing (which amounts may, subject to the proviso to
the first sentence of this Section 2.03(a), exceed such Lender's
Commitment), the rate or rates of interest therefor and such Lender's
Applicable Lending Office with respect to such Competitive Bid Advance;
provided that if the Agent in its capacity as a Lender shall, in its
sole discretion, elect to make any such offer, it shall notify the
Borrower of such offer at least 30 minutes before the time and on the
date on which notice of such election is to be given to the Agent, by
the other Lenders. If any Lender shall elect not to make such an offer,
such Lender shall so notify the Agent before 11:00 A.M. (New York City
time) on the date on which notice of such election is to be given to
the Agent by the other Lenders, and such Lender shall not be obligated
to, and shall not, make any Competitive Bid Advance as part of such
Competitive Bid Borrowing; provided that the failure by any Lender to
give such notice shall not cause such Lender to be obligated to make
any Competitive Bid Advance as part of such proposed Competitive Bid
Borrowing.
(iii) The Borrower shall, in turn, (A) before 11:30 A.M. (New
York City time) on the date of such proposed Competitive Bid Borrowing,
in the case of a Competitive Bid Borrowing consisting of Fixed Rate
Advances and (B) before 12:00 noon (New York City time) three Business
Days before the date of such proposed Competitive Bid Borrowing, in the
case of a Competitive Bid Borrowing consisting of LIBO Rate Advances,
either:
(x) cancel such Competitive Bid Borrowing by
giving the Agent notice to that effect, or
(y) accept one or more of the offers made by any
Lender or Lenders pursuant to paragraph (ii) above, in its
sole discretion, by giving notice to the Agent of the amount
of each Competitive Bid Advance (which amount shall be equal
to or greater than the minimum amount, and equal to or less
than the maximum amount, notified to the Borrower by the Agent
on behalf of such Lender for such Competitive Bid Advance
pursuant to paragraph (ii) above) to be made by each Lender as
part of such Competitive Bid Borrowing, and reject any
remaining offers made by Lenders pursuant to paragraph (ii)
above by giving the Agent notice to that effect. The Borrower
shall accept the offers made by any Lender or Lenders to make
Competitive Bid Advances in order of the lowest to the highest
rates of interest offered by such Lenders. If two or more
Lenders have offered the same interest rate, the amount to be
borrowed at such interest rate will be allocated among such
Lenders in proportion to the amount that each such Lender
offered at such interest rate.
(iv) If the Borrower notifies the Agent that such Competitive
Bid Borrowing is cancelled pursuant to paragraph (iii)(x) above, the
Agent shall give prompt notice thereof to the Lenders and such
Competitive Bid Borrowing shall not be made.
(v) If the Borrower accepts one or more of the offers made
by any Lender or Lenders pursuant to paragraph (iii)(y) above, the Agent
shall in turn promptly notify (A) each Lender that has made an offer as
described in paragraph (ii) above, of the date and aggregate amount of
such Competitive Bid Borrowing and whether or not any offer or offers
made by such Lender pursuant to paragraph (ii) above have been accepted
by the Borrower, (B) each Lender that is to make a Competitive Bid
Advance as part of such Competitive Bid Borrowing, of the amount of
each Competitive Bid Advance to be made by such Lender as part of such
Competitive Bid Borrowing, and (C) each Lender that is to make a
Competitive Bid Advance as part of such Competitive Bid Borrowing, upon
receipt, that the Agent has received forms of documents appearing to
fulfill the applicable conditions set forth in Article III. Each Lender
that is to make a Competitive Bid Advance as part of such Competitive
Bid Borrowing shall, before 1:00 P.M. (New York City time) on the date
of such Competitive Bid Borrowing specified in the notice received from
the Agent pursuant to clause (A) of the preceding sentence or any later
time when such Lender shall have received notice from the Agent
pursuant to clause (C) of the preceding sentence, make available for
the account of its Applicable Lending Office to the Agent at the
Agent's Account, in same day funds, such Lender's portion of such
Competitive Bid Borrowing. Upon fulfillment of the applicable
conditions set forth in Article III and after receipt by the Agent of
such funds, the Agent will make such funds available to the Borrower at
the Agent's address referred to in Section 8.02. Promptly after each
Competitive Bid Borrowing the Agent will notify each Lender of the
amount of the Competitive Bid Borrowing and the dates upon which such
Competitive Bid Borrowing commenced and will terminate.
(vi) If the Borrower notifies the Agent that it accepts one
or more of the offers made by any Lender or Lenders pursuant to
paragraph (iii)(y) above, such notice of acceptance shall be irrevocable
and binding on the Borrower. The Borrower shall indemnify each Lender
against any loss, cost or expense incurred by such Lender as a result
of any failure to fulfill on or before the date specified in the
related Notice of Competitive Bid Borrowing for such Competitive Bid
Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Competitive Bid Advance to be made
by such Lender as part of such Competitive Bid Borrowing when such
Competitive Bid Advance, as a result of such failure, is not made on
such date. The loss of a Lender shall include an amount equal to the
excess, if any, as reasonably determined by such Lender of (A) its cost
of obtaining funds for the Competitive Bid Advance not borrowed, to the
last day of the Interest Period for such Competitive Bid Advance which
would have commenced on the date of such failure to borrow over (B) the
amount of interest (as reasonably determined by such Lender) that could
be realized by such Lender in reemploying during such period the funds
not borrowed.
(b) Each Competitive Bid Borrowing shall be in an aggregate
amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof
and, following the making of each Competitive Bid Borrowing, the Borrower shall
be in compliance with the limitation set forth in the proviso to the first
sentence of subsection (a) above.
(c) Within the limits and on the conditions set forth in
this Section 2.03, the Borrower may from time to time borrow under this Section
2.03, repay or prepay pursuant to subsection (d) below, and reborrow under this
Section 2.03, provided that a Competitive Bid Borrowing shall not be made within
three Business Days of the date of any other Competitive Bid Borrowing.
(d) The Borrower shall repay to the Agent for the account of
each Lender that has made a Competitive Bid Advance, on the maturity date of
each Competitive Bid Advance (such maturity date being that specified by the
Borrower for repayment of such Competitive Bid Advance in the related Notice of
Competitive Bid Borrowing delivered pursuant to subsection (a)(i) above and
provided in the Competitive Bid Note evidencing such Competitive Bid Advance),
the then unpaid principal amount of such Competitive Bid Advance. The Borrower
shall have no right to prepay any principal amount of any Competitive Bid
Advance unless, and then only on the terms, specified by the Borrower for such
Competitive Bid Advance in the related Notice of Competitive Bid Borrowing
delivered pursuant to subsection (a)(i) above and set forth in the Competitive
Bid Note evidencing such Competitive Bid Advance.
(e) The Borrower shall pay interest on the unpaid principal
amount of each Competitive Bid Advance from the date of such Competitive Bid
Advance to the date the principal amount of such Competitive Bid Advance is
repaid in full, at the rate of interest for such Competitive Bid Advance
specified by the Lender making such Competitive Bid Advance in its notice with
respect thereto delivered pursuant to subsection (a)(ii) above, payable on the
interest payment date or dates specified by the Borrower for such Competitive
Bid Advance in the related Notice of Competitive Bid Borrowing delivered
pursuant to subsection (a)(i) above, as provided in the Competitive Bid Note
evidencing such Competitive Bid Advance. Upon the occurrence and during the
continuance of an Event of Default under Section 6.01(a), the Borrower shall pay
interest on the amount of unpaid principal of and interest on each Competitive
Bid Advance owing to a Lender, payable in arrears on the date or dates interest
is payable thereon, at a rate per annum equal at all times to 2% per annum above
the rate per annum required to be paid on such Competitive Bid Advance under the
terms of the Competitive Bid Note evidencing such Competitive Bid Advance unless
otherwise agreed in such Competitive Bid Note.
(f) The indebtedness of the Borrower resulting from each
Competitive Bid Advance made to the Borrower as part of a Competitive Bid
Borrowing shall be evidenced by a separate Competitive Bid Note of the Borrower
payable to the order of the Lender making such Competitive Bid Advance.
SECTION 2.04. Issuance of and Drawings and Reimbursement Under
Letters of Credit. (a) Request for Issuance. (i) Each Letter of Credit shall be
issued upon notice, given not later than 12:00 noon (New York City time) on the
third Business Day prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to any Issuing Bank, and such Issuing Bank shall give
the Agent, prompt notice thereof by telex, telecopier, telephone or cable. Each
such notice of issuance of a Letter of Credit (a "Notice of Issuance") shall be
by telex, telecopier, telephone or cable, confirmed immediately in writing,
specifying therein the requested (A) date of such issuance (which shall be a
Business Day), (B) Available Amount of such Letter of Credit, (C) expiration
date of such Letter of Credit, (D) name and address of the beneficiary of such
Letter of Credit and (E) form of such Letter of Credit, and shall be accompanied
by such application and agreement for letter of credit as such Issuing Bank may
reasonably specify to the Borrower for use in connection with such requested
Letter of Credit (a "Letter of Credit Agreement"). If the requested form of such
Letter of Credit is acceptable to such Issuing Bank in its sole discretion, such
Issuing Bank will, upon fulfillment of the applicable conditions set forth in
Article III, make such Letter of Credit available to the Borrower at its office
referred to in Section 8.02 or as otherwise agreed with the Borrower in
connection with such issuance. In the event and to the extent that the
provisions of any Letter of Credit Agreement shall conflict with this Agreement,
the provisions of this Agreement shall govern.
(b) Participations. By the issuance of a Letter of Credit
(or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the applicable Issuing Bank or the
Lenders, such Issuing Bank hereby grants to each Lender, and each Lender hereby
acquires from such Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Pro Rata Share of the aggregate amount available to be drawn
under such Letter of Credit. The Borrower hereby agrees to each such
participation. In consideration and in furtherance of the foregoing, each Lender
hereby absolutely and unconditionally agrees to pay to the Agent, for the
account of such Issuing Bank, such Lender's Pro Rata Share of each drawing made
under a Letter of Credit funded by such Issuing Bank and not reimbursed by the
Borrower on the date made, or of any reimbursement payment required to be
refunded to the Borrower for any reason. Each Lender acknowledges and agrees
that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a Default
or reduction or termination of the Revolving Credit Commitments, and that each
such payment shall be made without any offset, abatement, withholding or
reduction whatsoever.
(c) Drawing and Reimbursement. The payment by an Issuing
Bank of a draft drawn under any Letter of Credit shall constitute for all
purposes of this Agreement the making by any such Issuing Bank of a Revolving
Credit Advance, which shall be a Base Rate Advance, in the amount of such draft.
Upon written demand by such Issuing Bank, with a copy of such demand to the
Agent, each Lender shall pay to the Agent such Lender's Pro Rata Share of such
outstanding Revolving Credit Advance, by making available for the account of its
Applicable Lending Office to the Agent for the account of such Issuing Bank, by
deposit to the Agent's Account, in same day funds, an amount equal to the
portion of the outstanding principal amount of such Revolving Credit Advance to
be funded by such Lender. Promptly after receipt thereof, the Agent shall
transfer such funds to such Issuing Bank. Each Lender agrees to fund its Pro
Rata Share of an outstanding Revolving Credit Advance on (i) the Business Day on
which demand therefor is made by such Issuing Bank, provided that notice of such
demand is given not later than 12:00 noon (New York City time) on such Business
Day, or (ii) the first Business Day next succeeding such demand if notice of
such demand is given after such time. If and to the extent that any Lender shall
not have so made the amount of such Revolving Credit Advance available to the
Agent, such Lender agrees to pay to the Agent forthwith on demand such amount
together with interest thereon, for each day from the date of demand by any such
Issuing Bank until the date such amount is paid to the Agent, at the Federal
Funds Rate for its account or the account of such Issuing Bank, as applicable.
If such Lender shall pay to the Agent such amount for the account of any such
Issuing Bank on any Business Day, such amount so paid in respect of principal
shall constitute a Revolving Credit Advance made by such Lender on such Business
Day for purposes of this Agreement, and the outstanding principal amount of the
Revolving Credit Advance made by such Issuing Bank shall be reduced by such
amount on such Business Day.
(d) Letter of Credit Reports. Each Issuing Bank shall
furnish (A) to the Agent on the first Business Day of each week a written report
summarizing issuance and expiration dates of Letters of Credit issued during the
previous week and drawings during such week under all Letters of Credit, (B) to
each Lender on the first Business Day of each month a written report summarizing
issuance and expiration dates of Letters of Credit during the preceding month
and drawings during such month under all Letters of Credit and (C) to the Agent
and each Lender on the first Business Day of each calendar quarter a written
report setting forth the average daily aggregate Available Amount during the
preceding calendar quarter of all Letters of Credit.
(e) Failure to Make Revolving Credit Advances. The failure
of any Lender to make the Revolving Credit Advance to be made by it on the date
specified in Section 2.04(c) shall not relieve any other Lender of its
obligation hereunder to make its Revolving Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Revolving Credit Advance to be made by such other Lender on such date.
SECTION 2.05. Fees. (a) Facility Fee. The Borrower agrees
to pay to the Agent for the account of each Lender a facility fee on the
aggregate amount of such Lender's Revolving Credit Commitment from the date
hereof in the case of each Initial Lender and from the effective date specified
in the Assumption Agreement or in the Assignment and Acceptance pursuant to
which it became a Lender in the case of each other Lender until the Termination
Date at a rate per annum equal to the Applicable Percentage in effect from time
to time, payable in arrears quarterly on the last day of each March, June,
September and December, commencing June 30, 2002, and on the Termination Date.
(b) Letter of Credit Fees (i) The Borrower shall pay to the
Agent for the account of each Lender a commission on such Lender's Pro Rata
Share of the average daily aggregate Available Amount of all Letters of Credit
outstanding from time to time at a rate per annum equal to the Applicable Margin
for Eurocurrency Rate Advances in effect from time to time plus the Applicable
Utilization Fee, if any, payable in arrears quarterly on the last day of each
March, June, September and December, commencing June 30, 2002, and on the
Termination Date.
(ii) The Borrower shall pay to each Issuing Bank, for its own
account, such commissions, issuance fees, fronting fees, transfer fees and other
fees and charges in connection with the issuance or administration of each
Letter of Credit as the Borrower and such Issuing Bank shall agree.
(c) Agent's Fees. The Borrower shall pay to the Agent
for its own account such fees as may from time to time be agreed between the
Borrower and the Agent.
SECTION 2.06. Optional Termination or Reduction of the
Commitments. The Borrower shall have the right, upon at least three Business
Days' notice to the Agent, to terminate in whole or permanently reduce ratably
in part the Unused Commitments of the Lenders, provided that each partial
reduction shall be in the aggregate amount of $10,000,000 or an integral
multiple of $1,000,000 in excess thereof.
SECTION 2.07. Repayment of Revolving Credit Advances.
(a) The Borrower shall repay to the Agent for the ratable account of the Lenders
on the Termination Date the aggregate principal amount of the Revolving Credit
Advances then outstanding.
(b) The obligations of the Borrower under this Agreement,
any Letter of Credit Agreement and any other agreement or instrument relating to
any Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of Credit
Agreement and such other agreement or instrument under all circumstances,
including, without limitation, the following circumstances (it being understood
that any such payment by the Borrower is without prejudice to, and does not
constitute a waiver of, any rights the Borrower might have or might acquire as a
result of the payment by any Lender of any draft or the reimbursement by the
Borrower thereof):
(i) any lack of validity or enforceability of this
Agreement, any Note, any Letter of Credit Agreement, any Letter of
Credit or any other agreement or instrument relating thereto (all of the
foregoing being, collectively, the "L/C Related Documents");
(ii) any change in the time, manner or place of payment of,
or in any other term of, all or any of the obligations of the Borrower
in respect of any L/C Related Document or any other amendment or waiver
of or any consent to departure from all or any of the L/C Related
Documents;
(iii) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for which any such
beneficiary or any such transferee may be acting), any Issuing Bank,
any Agent, any Lender or any other Person, whether in connection with
the transactions contemplated by the L/C Related Documents or any
unrelated transaction;
(iv) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(v) payment by any Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any guarantee, for all or any of the obligations of the
Borrower in respect of the L/C Related Documents; or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including, without limitation,
any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower or a guarantor.
SECTION 2.08. Interest on Revolving Credit Advances.
(a) Scheduled Interest. The Borrower shall pay interest on the unpaid principal
amount of each Revolving Credit Advance owing to each Lender from the date of
such Revolving Credit Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. During such periods as such
Revolving Credit Advance is a Base Rate Advance, a rate per annum equal
at all times to the sum of (x) the Base Rate in effect from time to time
plus (y) the Applicable Margin in effect from time to time plus (z) the
Applicable Utilization Fee in effect from time to time, payable in
arrears quarterly on the last day of each March, June, September and
December during such periods and on the date such Base Rate Advance
shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Revolving Credit Advance is a Eurodollar Rate Advance, a rate per annum
equal at all times during each Interest Period for such Revolving
Credit Advance to the sum of (x) the Eurodollar Rate for such Interest
Period for such Revolving Credit Advance plus (y) the Applicable Margin
in effect from time to time plus (z) the Applicable Utilization Fee in
effect from time to time, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more
than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) Default Interest. Upon the occurrence and during the
continuance of an Event of Default under Section 6.01(a), the Agent may, and
upon the request of the Required Lenders shall, require the Borrower to pay
interest ("Default Interest") on (i) the unpaid principal amount of each
Revolving Credit Advance owing to each Lender, payable in arrears on the dates
referred to in clause (a)(i) or (a)(ii) above, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid on such
Revolving Credit Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to
the fullest extent permitted by law, the amount of any interest, fee or other
amount payable hereunder that is not paid when due, from the date such amount
shall be due until such amount shall be paid in full, payable in arrears on the
date such amount shall be paid in full and on demand, at a rate per annum equal
at all times to 2% per annum above the rate per annum required to be paid on
Base Rate Advances pursuant to clause (a)(i) above, provided, however, that
following acceleration of the Advances pursuant to Section 6.01, Default
Interest shall accrue and be payable hereunder whether or not previously
required by the Agent.
SECTION 2.09. Interest Rate Determination. (a) Each Reference
Bank agrees to furnish to the Agent timely information for the purpose of
determining each Eurodollar Rate and each LIBO Rate. If any one or more of the
Reference Banks shall not furnish such timely information to the Agent for the
purpose of determining any such interest rate, the Agent shall determine such
interest rate on the basis of timely information furnished by the remaining
Reference Banks. The Agent shall give prompt notice to the Borrower and the
Lenders of the applicable interest rate determined by the Agent for purposes of
Section 2.08(a)(i) or (ii), and the rate, if any, furnished by each Reference
Bank for the purpose of determining the interest rate under Section 2.08(a)(ii).
(b) If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Agent that the Eurodollar Rate for any Interest
Period for such Advances will not adequately reflect the cost to such Required
Lenders of making, funding or maintaining their respective Eurodollar Rate
Advances for such Interest Period, the Agent shall forthwith so notify the
Borrower and the Lenders, whereupon (i) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance, and (ii) the obligation of the Lenders to
make, or to Convert Revolving Credit Advances into, Eurodollar Rate Advances
shall be suspended until the Agent shall notify the Borrower and the Lenders
that the circumstances causing such suspension no longer exist.
(c) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Agent will forthwith so notify the Borrower and the Lenders and such Advances
will automatically, on the last day of the then existing Interest Period
therefor, have a subsequent Interest Period of one month.
(d) Upon the occurrence and during the continuance of any
Event of Default, (i) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (ii) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
(e) If Telerate Markets Page 3750 is unavailable and fewer
than two Reference Banks furnish timely information to the Agent for determining
the Eurodollar Rate or LIBO Rate for any Eurodollar Rate Advances or LIBO Rate
Advances, as the case may be,
(i) the Agent shall forthwith notify the Borrower and the
Lenders that the interest rate cannot be determined for such Eurodollar
Rate Advances or LIBO Rate Advances, as the case may be,
(ii) with respect to Eurodollar Rate Advances, each such
Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance (or if such
Advance is then a Base Rate Advance, will continue as a Base Rate
Advance), and
(iii) the obligation of the Lenders to make Eurodollar Rate
Advances or LIBO Rate Advances or to Convert Revolving Credit Advances
into Eurodollar Rate Advances shall be suspended until the Agent shall
notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
SECTION 2.10. Optional Conversion of Revolving Credit
Advances. The Borrower may on any Business Day, upon notice given to the Agent
not later than 12:00 noon (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of Sections
2.09 and 2.13, Convert all Revolving Credit Advances of one Type comprising the
same Borrowing into Revolving Credit Advances of the other Type; provided,
however, that any Conversion of Eurodollar Rate Advances into Base Rate Advances
shall be made only on the last day of an Interest Period for such Eurodollar
Rate Advances and any Conversion of Base Rate Advances into Eurodollar Rate
Advances shall be in an amount not less than the minimum amount specified in
Section 2.02(b). Each such notice of a Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Revolving
Credit Advances to be Converted, and (iii) if such Conversion is into Eurodollar
Rate Advances, the duration of the initial Interest Period for each such
Advance. Each notice of Conversion shall be irrevocable and binding on the
Borrower.
SECTION 2.11. Prepayments of Revolving Credit Advances. The
Borrower may, upon notice at least two Business Days' prior to the date of such
prepayment, in the case of Eurodollar Rate Advances, and not later than 12:00
noon (New York City time) on the date of such prepayment, in the case of Base
Rate Advances, to the Agent stating the proposed date and aggregate principal
amount of the prepayment, and if such notice is given the Borrower shall, prepay
the outstanding principal amount of the Revolving Credit Advances comprising
part of the same Revolving Credit Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof and (y) in the event of any such prepayment of a
Eurodollar Rate Advance, the Borrower shall be obligated to reimburse the
Lenders in respect thereof pursuant to Section 8.04(c).
SECTION 2.12. Increased Costs. (a) If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender of agreeing to make or
making, funding or maintaining Eurodollar Rate Advances or LIBO Rate Advances or
of agreeing to issue or of issuing or maintaining or participating in Letters of
Credit (excluding for purposes of this Section 2.12 any such increased costs
resulting from (i) Taxes or Other Taxes (as to which Section 2.15 shall govern)
and (ii) changes in the basis of taxation of overall net income or overall gross
income by the United States or by the foreign jurisdiction or state under the
laws of which such Lender is organized or has its Applicable Lending Office or
any political subdivision thereof), then the Borrower shall from time to time,
upon demand by such Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such Lender additional amounts sufficient to compensate
such Lender for such increased cost. A certificate as to the amount of such
increased cost, submitted to the Borrower and the Agent by such Lender, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If any Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and that the amount of such
capital is increased by or based upon the existence of such Lender's commitment
to lend hereunder and other commitments of this type, then, upon demand by such
Lender (with a copy of such demand to the Agent), the Borrower shall pay to the
Agent for the account of such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender's commitment to lend hereunder. A certificate as to such amounts
submitted to the Borrower and the Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 2.13. Illegality. Notwithstanding any other provision
of this Agreement, if any Lender shall notify the Agent that the introduction of
or any change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority asserts that it is
unlawful, for any Lender or its Eurodollar Lending Office to perform its
obligations hereunder to make Eurodollar Rate Advances or LIBO Rate Advances or
to fund or maintain Eurodollar Rate Advances or LIBO Rate Advances hereunder,
(a) each Eurodollar Rate Advance or LIBO Rate Advance, as the case may be, will
automatically, upon such demand, Convert into a Base Rate Advance or an Advance
that bears interest at the rate set forth in Section 2.08(a)(i), as the case may
be, and (b) the obligation of the Lenders to make Eurodollar Rate Advances or
LIBO Rate Advances or to Convert Revolving Credit Advances into Eurodollar Rate
Advances shall be suspended until the Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist;
provided, however, that before making any such demand, each Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.14. Payments and Computations. (a) The Borrower
shall make each payment hereunder, irrespective of any right of counterclaim or
set-off, not later than 12:00 noon (New York City time) on the day when due in
U.S. dollars to the Agent at the Agent's Account in same day funds. The Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal, interest, facility fees or letter of credit commissions
ratably (other than amounts payable pursuant to Section 2.03, 2.12, 2.15 or
8.04(c)) to the Lenders for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other amount payable to
any Lender to such Lender for the account of its Applicable Lending Office, in
each case to be applied in accordance with the terms of this Agreement. Upon any
Assuming Lender becoming a Lender hereunder as a result of an extension of the
Termination Date pursuant to Section 2.19, and upon the Agent's receipt of such
Lender's Assumption Agreement and recording of the information contained therein
in the Register, from and after the applicable Extension Date, the Agent shall
make all payments hereunder and under any Notes issued in connection therewith
in respect of the interest assumed thereby to the Assuming Lender. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 8.07(c), from and after
the effective date specified in such Assignment and Acceptance, the Agent shall
make all payments hereunder and under the Notes in respect of the interest
assigned thereby to the Lender assignee thereunder, and the parties to such
Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between themselves.
(b) The Borrower hereby authorizes each Lender, if and to
the extent payment owed to such Lender is not made by the Borrower to the Agent
when due hereunder or under the Note held by such Lender, to charge from time to
time against any or all of the Borrower's accounts with such Lender any amount
so due.
(c) All computations of interest based on clause (i) of the
definition of Base Rate shall be made by the Agent on the basis of a year of 365
or 366 days, as the case may be, and all computations of interest based on the
Eurodollar Rate, the LIBO Rate, the Federal Funds Rate or clause (ii) of the
definition of Base Rate or in respect of Fixed Rate Advances and of fees and
Letter of Credit commissions shall be made by the Agent on the basis of a year
of 360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest,
fees or commissions are payable. Each determination by the Agent of an interest
rate hereunder shall be conclusive and binding for all purposes, absent manifest
error.
(d) Whenever any payment hereunder or under the Notes shall
be stated to be due on a day other than a Business Day, such payment shall be
made on the next succeeding Business Day, provided, however, that, if such
extension would cause payment of interest on or principal of Eurodollar Rate
Advances or LIBO Rate Advances to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day, and such
extension or decrease of time shall in such case be included in the computation
of payment of interest, fee or commission, as the case may be.
(e) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Agent may assume that
the Borrower has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such Lender. If
and to the extent the Borrower shall not have so made such payment in full to
the Agent, each Lender shall repay to the Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day from the
date such amount is distributed to such Lender until the date such Lender repays
such amount to the Agent, at the Federal Funds Rate.
SECTION 2.15. Taxes. (a) Any and all payments by the Borrower
to or for the account of any Lender or the Agent hereunder or under the Notes or
any other documents to be delivered hereunder shall be made, in accordance with
Section 2.14 or the applicable provisions of such other documents, 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, apart from Excluded Taxes. As used in this Section 2.15, "Excluded
Taxes" means with respect to each Lender and the Agent, (x) taxes imposed on its
overall net income, and franchise taxes imposed on it in lieu of net income
taxes, by the jurisdiction under the laws of which such Lender or the Agent (as
the case may be) is organized or any political subdivision thereof and, in the
case of each Lender, taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes, by the jurisdiction of such
Lender's Applicable Lending Office or any political subdivision thereof and (y)
taxes that are directly attributable to such Lender's failure to comply with the
provisions of Section 2.15(e), (f) and (g) (all such taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments
hereunder or under the Notes, other than Excluded Taxes, 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 or under any Note or any
other documents to be delivered hereunder to any Lender or the Agent, (i) the
sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.15) such Lender or the Agent (as the case may be) receives
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 taxation authority or other
authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies that arise from any payment made hereunder or under the Notes
or any other documents to be delivered hereunder or from the execution, delivery
or registration of, performing under, or otherwise with respect to, this
Agreement or the Notes or any other documents to be delivered hereunder
(hereinafter referred to as "Other Taxes").
(c) The Borrower shall indemnify each Lender and the Agent
for and hold it harmless against the full amount of Taxes or Other Taxes
(including, without limitation, taxes of any kind imposed or asserted by any
jurisdiction on amounts payable under this Section 2.15) imposed on or paid by
such Lender or the Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto.
This indemnification shall be made within 30 days from the date such Lender or
the Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes,
the Borrower shall furnish to the Agent, at its address referred to in Section
8.02, the original or a certified copy of a receipt evidencing such payment to
the extent such a receipt is issued therefor, or other written proof of payment
thereof that is reasonably satisfactory to the Agent. For purposes of this
subsection (d) and subsection (e), the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the Internal
Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Initial Lender and on the date of the
Assumption Agreement or the Assignment and Acceptance pursuant to which it
becomes a Lender in the case of each other Lender, and from time to time
thereafter as reasonably requested in writing by the Borrower (but only so long
as such Lender remains lawfully able to do so), shall provide each of the Agent
and the Borrower with two original Internal Revenue Service forms W-8BEN or
W-8ECI, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that such Lender is exempt from or entitled
to a reduced rate of United States withholding tax on payments pursuant to this
Agreement or the Notes. If the form provided by a Lender at the time such Lender
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered Excluded Taxes unless and until such Lender provides the appropriate
forms certifying that a lesser rate applies, whereupon withholding tax at such
lesser rate only shall be considered Excluded Taxes for periods governed by such
form; provided, however, that, if at the date of the Assignment and Acceptance
pursuant to which a Lender assignee becomes a party to this Agreement, the
Lender assignor was entitled to payments under subsection (a) in respect of
United States withholding tax with respect to interest paid at such date, then,
to such extent, the term Taxes shall include (in addition to withholding taxes
that may be imposed in the future or other amounts otherwise includable in
Taxes) United States withholding tax, if any, applicable with respect to the
Lender assignee on such date.
(f) For any period with respect to which a Lender has failed
to provide the Borrower with the appropriate form, certificate or other document
described in Section 2.15(e) (other than if such failure is due to a change in
law, or in the interpretation or application thereof, occurring subsequent to
the date on which a form, certificate or other document originally was required
to be provided, or if such form, certificate or other document otherwise is not
required under subsection (e) above), such Lender shall not be entitled to
indemnification under Section 2.15(a) or (c) with respect to Taxes imposed by
the United States by reason of such failure; provided, however, that should a
Lender become subject to Taxes because of its failure to deliver a form,
certificate or other document required hereunder, the Borrower, at the Lender's
expense, shall take such steps as the Lender shall reasonably request to assist
the Lender to recover such Taxes.
(g) Any Lender claiming any additional amounts payable
pursuant to this Section 2.15 agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to file any
certificate or document requested by the Borrower or to change the jurisdiction
of its Eurodollar Lending Office if the making of such a filing or change would
avoid the need for, or reduce the amount of, any such additional amounts that
may thereafter accrue and would not, in the reasonable judgment of such Lender,
be otherwise disadvantageous to such Lender.
(h) If any Lender determines, in its sole discretion, that
it has actually and finally realized, by reason of a refund, deduction or credit
of any Taxes paid or reimbursed by the Borrower pursuant to subjection (a) or
(c) above in respect of payments under the Credit Agreement or the Notes, a
current monetary benefit that it would otherwise not have obtained, and that
would result in the total payments under this Section 2.15 exceeding the amount
needed to make such Lender whole, such Lender shall pay to the Borrower, with
reasonable promptness following the date on which it actually realizes such
benefit, an amount equal to the lesser of the amount of such benefit or the
amount of such excess, in each case net of all out-of-pocket expenses in
securing such refund, deduction or credit. Nothing in this paragraph (h) shall
be construed to require the Agent, any Lender or any Issuing Bank to make
available its tax returns (or any other information relating to is taxes which
it deems confidential) to the Borrower or any other Person.
SECTION 2.16. Sharing of Payments, Etc. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Revolving Credit Advances
owing to it (other than pursuant to Section 2.12, 2.15 or 8.04(c)) in excess of
its ratable share of payments on account of the Revolving Credit Advances
obtained by all the Lenders, such Lender shall forthwith purchase from the other
Lenders such participations in the Revolving Credit Advances owing to them as
shall be necessary to cause such purchasing Lender to share the excess payment
ratably with each of them; provided, however, that if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and such Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (i) the amount of such Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 2.16 may, to the fullest extent permitted by
law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
SECTION 2.17. Evidence of Debt. (a) Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Revolving Credit
Advance owing to such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder in respect of Revolving Credit Advances. The Borrower agrees that upon
notice by any Lender to the Borrower (with a copy of such notice to the Agent)
to the effect that a Revolving Credit Note is required or appropriate in order
for such Lender to evidence (whether for purposes of pledge, enforcement or
otherwise) the Revolving Credit Advances owing to, or to be made by, such
Lender, the Borrower shall promptly execute and deliver to such Lender a
Revolving Credit Note payable to the order of such Lender in a principal amount
up to the Revolving Credit Commitment of such Lender.
(b) The Register maintained by the Agent pursuant to Section
8.07(d) shall include a control account, and a subsidiary account for each
Lender, in which accounts (taken together) shall be recorded (i) the date and
amount of each Borrowing made hereunder, the Type of Advances comprising such
Borrowing and, if appropriate, the Interest Period applicable thereto, (ii) the
terms of each Assumption Agreement and each Assignment and Acceptance delivered
to and accepted by it, (iii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iv) the amount of any sum received by the Agent from the Borrower hereunder
and each Lender's share thereof.
(c) Entries made in good faith by the Agent in the Register
pursuant to subsection (b) above, and by each Lender in its account or accounts
pursuant to subsection (a) above, shall be prima facie evidence of the amount of
principal and interest due and payable or to become due and payable from the
Borrower to, in the case of the Register, each Lender and, in the case of such
account or accounts, such Lender, under this Agreement, absent manifest error;
provided, however, that the failure of the Agent or such Lender to make an
entry, or any finding that an entry is incorrect, in the Register or such
account or accounts shall not limit or otherwise affect the obligations of the
Borrower under this Agreement.
SECTION 2.18. Use of Proceeds. The proceeds of the Advances
and issuances of Letters of Credit shall be available (and the Borrower agrees
that it shall use such proceeds) solely for general corporate purposes (which
shall include refunding of commercial paper) of the Borrower and its
Subsidiaries.
SECTION 2.19. Extension of Termination Date. (a) At least 60
days but not more than 90 days prior to any anniversary of the Effective Date,
the Borrower, by written notice to the Agent, may request an extension of the
Termination Date in effect at such time by one year from its then scheduled
expiration. The Agent shall promptly notify each Lender of such request, and
each Lender shall in turn, in its sole discretion, not later than 20 days prior
to such anniversary date, notify the Borrower and the Agent in writing as to
whether such Lender will consent to such extension. If any Lender shall fail to
notify the Agent and the Borrower in writing of its consent to any such request
for extension of the Termination Date at least 20 days prior to such anniversary
date, such Lender shall be deemed to be a Non-Consenting Lender with respect to
such request. The Agent shall notify the Borrower not later than 15 days prior
to such anniversary date of the decision of the Lenders regarding the Borrower's
request for an extension of the Termination Date.
(b) If all the Lenders consent in writing to any such
request in accordance with subsection (a) of this Section 2.19, the Termination
Date in effect at such time shall, effective as at the applicable anniversary
date (the "Extension Date"), be extended for one year; provided that on each
Extension Date the applicable conditions set forth in Article III shall be
satisfied. If less than all of the Lenders consent in writing to any such
request in accordance with subsection (a) of this Section 2.19, the Termination
Date in effect at such time shall, effective as at the applicable Extension Date
and subject to subsection (d) of this Section 2.19, be extended as to those
Lenders that so consented (each a "Consenting Lender") but shall not be extended
as to any other Lender (each a "Non-Consenting Lender"). To the extent that the
Termination Date is not extended as to any Lender pursuant to this Section 2.19
and the Revolving Credit Commitment of such Lender is not assumed in accordance
with subsection (c) of this Section 2.19 on or prior to the applicable Extension
Date, the Revolving Credit Commitment of such Non-Consenting Lender shall
automatically terminate in whole on such unextended Termination Date without any
further notice or other action by the Borrower, such Lender or any other Person;
provided that such Non-Consenting Lender's rights under Sections 2.12, 2.15 and
8.04, and its obligations under Section 7.05, shall survive the Termination Date
for such Lender as to matters occurring prior to such date. It is understood and
agreed that no Lender shall have any obligation whatsoever to agree to any
request made by the Borrower for any requested extension of the Termination
Date.
(c) If less than all of the Lenders consent to any such
request pursuant to subsection (a) of this Section 2.19, the Agent shall
promptly so notify the Consenting Lenders, and each Consenting Lender may, in
its sole discretion, give written notice to the Agent not later than 10 days
prior to the Extension Date of the amount of the Non-Consenting Lenders'
Revolving Credit Commitments for which it is willing to accept an assignment. If
the Consenting Lenders notify the Agent that they are willing to accept
assignments of Commitments in an aggregate amount that exceeds the amount of the
Revolving Credit Commitments of the Non-Consenting Lenders, such Revolving
Credit Commitments shall be allocated among the Consenting Lenders willing to
accept such assignments in such amounts as are agreed between the Borrower and
the Agent. If after giving effect to the assignments of Revolving Credit
Commitments described above there remains any Revolving Credit Commitments of
Non-Consenting Lenders, the Borrower may arrange for one or more Consenting
Lenders or other Eligible Assignees (an "Assuming Lender") to assume, effective
as of the Extension Date, any Non-Consenting Lender's Revolving Credit
Commitment and all of the obligations of such Non-Consenting Lender under this
Agreement thereafter arising, without recourse to or warranty by, or expense to,
such Non-Consenting Lender; provided, however, that the amount of the Revolving
Credit Commitment of any such Assuming Lender as a result of such substitution
shall in no event be less than $10,000,000 unless the amount of the Commitment
of such Non-Consenting Lender is less than $1,000,000, in which case such
Assuming Lender shall assume all of such lesser amount; and provided further
that:
(i) any such Consenting Lender or Assuming Lender shall have
paid to such Non-Consenting Lender (A) the aggregate principal amount
of, and any interest accrued and unpaid to the effective date of the
assignment on, the outstanding Advances, if any, of such Non-Consenting
Lender plus (B) any accrued but unpaid facility fees and letter of
credit commissions owing to such Non-Consenting Lender as of the
effective date of such assignment;
(ii) all additional costs, reimbursements, expense
reimbursements and indemnities payable to such Non-Consenting Lender,
and all other accrued and unpaid amounts owing to such Non-Consenting
Lender hereunder, as of the effective date of such assignment shall
have been paid to such Non-Consenting Lender; and
(iii) with respect to any such Assuming Lender, the applicable
processing and recordation fee required under Section 8.07(a) for such
assignment shall have been paid;
provided further that such Non-Consenting Lender's rights under Sections 2.12,
2.15 and 8.04, and its obligations under Section 7.05, shall survive such
substitution as to matters occurring prior to the date of substitution. At least
three Business Days prior to any Extension Date, (A) each such Assuming Lender,
if any, shall have delivered to the Borrower and the Agent an agreement (an
"Assumption Agreement") in form and substance satisfactory to the Borrower and
the Agent, duly executed by such Assuming Lender, such Non-Consenting Lender,
the Borrower and the Agent, (B) any such Consenting Lender shall have delivered
confirmation in writing satisfactory to the Borrower and the Agent as to the
increase in the amount of its Revolving Credit Commitment and (C) each
Non-Consenting Lender being replaced pursuant to this Section 2.19 shall have
delivered to the Agent any Note or Notes held by such Non-Consenting Lender.
Upon the payment or prepayment of all amounts referred to in clauses (i), (ii)
and (iii) of the immediately preceding sentence, each such Consenting Lender or
Assuming Lender, as of the Extension Date, will be substituted for such
Non-Consenting Lender under this Agreement and shall be a Lender for all
purposes of this Agreement, without any further acknowledgment by or the consent
of the other Lenders, and the obligations of each such Non-Consenting Lender
hereunder shall, by the provisions hereof, be released and discharged.
(d) If (after giving effect to any assignments or
assumptions pursuant to subsection (c) of this Section 2.19) Lenders having
Revolving Credit Commitments equal to at least 75% of the Revolving Credit
Commitments in effect immediately prior to the Extension Date consent in writing
to a requested extension (whether by execution or delivery of an Assumption
Agreement or otherwise) not later than one Business Day prior to such Extension
Date, the Agent shall so notify the Borrower, and, subject to the satisfaction
of the applicable conditions in Article III, the Termination Date then in effect
shall be extended for the additional one year period as described in subsection
(a) of this Section 2.19, and all references in this Agreement and in the Notes,
if any, to the "Termination Date" shall, with respect to each Consenting Lender
and each Assuming Lender for such Extension Date, refer to the Termination Date
as so extended. Promptly following each Extension Date, the Agent shall notify
the Lenders (including, without limitation, each Assuming Lender) of the
extension of the scheduled Termination Date in effect immediately prior thereto
and shall thereupon record in the Register the relevant information with respect
to each such Consenting Lender and each such Assuming Lender.
ARTICLE III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. Conditions Precedent to Effectiveness of
Sections 2.01 and 2.03. Sections 2.01 and 2.03 of this Agreement shall become
effective on and as of the first date (the "Effective Date") on which the
following conditions precedent have been satisfied:
(a) There shall have occurred no Material Adverse Change
since December 31, 2001.
(b) There shall exist no action, suit, investigation,
litigation or proceeding affecting the Borrower or any of its
Subsidiaries pending or threatened before any court, governmental
agency or arbitrator that (i) could be reasonably likely to have a
Material Adverse Effect or (ii) purports to affect the legality,
validity or enforceability of this Agreement or any Note or the
consummation of the transactions contemplated hereby.
(c) Nothing shall have come to the attention of the Lenders
during the course of their due diligence investigation to lead them to
believe that the Information Memorandum was or has become misleading,
incorrect or incomplete in any material respect; without limiting the
generality of the foregoing, the Lenders shall have been given such
access to the management, records, books of account, contracts and
properties of the Borrower and its Subsidiaries as they shall have
requested.
(d) All governmental and third party consents and approvals
necessary in connection with the transactions contemplated hereby shall
have been obtained (without the imposition of any conditions that are
not acceptable to the Lenders) and shall remain in effect, and no law
or regulation shall be applicable in the reasonable judgment of the
Lenders that restrains, prevents or imposes materially adverse
conditions upon the transactions contemplated hereby.
(e) The Borrower shall have notified each Lender and
the Agent in writing as to the proposed Effective Date.
(f) The Borrower shall have paid all accrued fees and
expenses of the Agent and the Lenders (including the accrued fees and
expenses of counsel to the Agent) that have been billed to the Borrower.
(g) On the Effective Date, the following statements shall be
true and the Agent shall have received for the account of each Lender a
certificate signed by a duly authorized officer of the Borrower, dated
the Effective Date, stating that:
(i) The representations and warranties contained
in Section 4.01 are correct on and as of the Effective Date,
and
(ii) No event has occurred and is continuing that
constitutes a Default.
(h) The Agent shall have received on or before the Effective
Date the following, each dated such day, in form and substance
satisfactory to the Agent and (except for the Revolving Credit Notes)
in sufficient copies for each Lender:
(i) The Revolving Credit Notes to the order of the
Lenders to the extent requested by any Lender pursuant to
Section 2.17.
(ii) Certified copies of the resolutions of the Board
of Directors of the Borrower approving this Agreement and the
Notes, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with
respect to this Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant
Secretary of the Borrower certifying the names and true
signatures of the officers of the Borrower authorized to sign
this Agreement and the Notes and the other documents to be
delivered hereunder.
(iv) A favorable opinion of Mark C. Hill, Vice
President, Secretary and General Counsel of the Borrower,
substantially in the form of Exhibit D hereto and as to such
other matters as any Lender through the Agent may reasonably
request.
(v) A favorable opinion of Shearman & Sterling,
counsel for the Agent, in form and substance satisfactory to the
Agent.
(i) The termination of the commitments of the
lenders and the payment in full of all Debt outstanding under
(i) the $300,000,000 Revolving Credit Agreement (Facility A)
dated as of June 25, 1998 among the Borrower, the lenders
parties thereto and NationsBank, N.A, as administrative agent,
and(ii) $300,000,000 Revolving Credit Agreement (Facility B)
dated as of June 25, 1998 among the Borrower, the lenders
parties thereto and NationsBank, N.A, as administrative agent.
By execution of this Agreement, each of the Lenders that is a
lender under a credit agreement referred to in clause (i) or
(ii) above hereby waives any requirement set forth in such
credit agreement of prior notice to the termination of their
commitments thereunder.
SECTION 3.02. Conditions Precedent to Each Revolving Credit
Borrowing, Letter of Credit Issuance and Extension Date. The obligation of each
Lender to make a Revolving Credit Advance on the occasion of each Revolving
Credit Borrowing, the obligation of each Issuing Bank to issue a Letter of
Credit and each extension of Revolving Credit Commitments pursuant to Section
2.19 shall be subject to the conditions precedent that the Effective Date shall
have occurred and on the date of such Revolving Credit Borrowing, issuance or
the applicable Extension Date (a) the following statements shall be true (and
each of the giving of the applicable Notice of Revolving Credit Borrowing,
Notice of Issuance, request for Commitment Extension and the acceptance by the
Borrower of the proceeds of such Revolving Credit Borrowing or Letter of Credit
shall constitute a representation and warranty by the Borrower that on the date
of such Borrowing, such issuance or such Extension Date such statements are
true):
(i) the representations and warranties contained in Section
4.01 (except, in the case of Revolving Credit Borrowings and the
issuance of a Letter of Credit, the representation set forth in
subsection (j) thereof) are correct on and as of such date, before and
after giving effect to such Revolving Credit Borrowing, such issuance
or such Extension Date and to the application of the proceeds
therefrom, as though made on and as of such date, and
(ii) no event has occurred and is continuing, or would result
from such Revolving Credit Borrowing, such issuance or such Extension
Date or from the application of the proceeds therefrom, that
constitutes a Default;
and (b) the Agent shall have received such other approvals, opinions or
documents as any Lender through the Agent may reasonably request.
SECTION 3.03. Conditions Precedent to Each Competitive Bid
Borrowing. The obligation of each Lender that is to make a Competitive Bid
Advance on the occasion of a Competitive Bid Borrowing to make such Competitive
Bid Advance as part of such Competitive Bid Borrowing is subject to the
conditions precedent that (i) the Agent shall have received the written
confirmatory Notice of Competitive Bid Borrowing with respect thereto, (ii) on
or before the date of such Competitive Bid Borrowing, but prior to such
Competitive Bid Borrowing, the Agent shall have received a Competitive Bid Note
payable to the order of such Lender for each of the one or more Competitive Bid
Advances to be made by such Lender as part of such Competitive Bid Borrowing, in
a principal amount equal to the principal amount of the Competitive Bid Advance
to be evidenced thereby and otherwise on such terms as were agreed to for such
Competitive Bid Advance in accordance with Section 2.03, and (iii) on the date
of such Competitive Bid Borrowing the following statements shall be true (and
each of the giving of the applicable Notice of Competitive Bid Borrowing and the
acceptance by the Borrower of the proceeds of such Competitive Bid Borrowing
shall constitute a representation and warranty by the Borrower that on the date
of such Competitive Bid Borrowing such statements are true):
(a) the representations and warranties contained in Section
4.01(a) through (i) are correct on and as of the date of such
Competitive Bid Borrowing, before and after giving effect to such
Competitive Bid Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date,
(b) no event has occurred and is continuing, or would result
from such Competitive Bid Borrowing or from the application of the
proceeds therefrom, that constitutes a Default, and
(c) no event has occurred and no circumstance exists of
which the Borrower has become aware, as a result of which the
information concerning the Borrower that has been provided to the Agent
and each Lender by the Borrower in connection herewith is shown to
contain an untrue statement of a material fact or is shown to have
omitted to state any material fact or any fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading as if the date such information was
provided.
SECTION 3.04. Determinations Under Section 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by this Agreement
shall have received notice from such Lender prior to the date that the Borrower,
by notice to the Lenders, designates as the proposed Effective Date, specifying
its objection thereto. The Agent shall promptly notify the Lenders of the
occurrence of the Effective Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the
Borrower. The Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
(b) The execution, delivery and performance by the Borrower
of this Agreement and the Notes to be delivered by it, and the
consummation of the transactions contemplated hereby, are within the
Borrower's corporate powers, have been duly authorized by all necessary
corporate action, and do not contravene (i) the Borrower's charter or
by-laws or (ii) law or any contractual restriction binding on or
affecting the Borrower.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery
and performance by the Borrower of this Agreement or the Notes to be
delivered by it.
(d) This Agreement has been, and each of the Notes to be
delivered by it when delivered hereunder will have been, duly executed
and delivered by the Borrower. This Agreement is, and each of the Notes
when delivered hereunder will be, the legal, valid and binding
obligation of the Borrower enforceable against the Borrower in
accordance with their respective terms (subject, as to the enforcement
of remedies, to applicable bankruptcy, reorganization, moratorium and
similar laws affecting creditors rights generally).
(e) The Consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 2001, and the related Consolidated
statements of income and cash flows of the Borrower and its
Subsidiaries for the fiscal year then ended, accompanied by an opinion
of PricewaterhouseCoopers LLP, independent public accountants, and the
Consolidated balance sheet of the Borrower and its Subsidiaries as at
March 31, 2002, and the related Consolidated statements of income and
cash flows of the Borrower and its Subsidiaries for the three months
then ended, duly certified by the chief financial officer of the
Borrower, copies of which have been furnished to each Lender, fairly
present, subject, in the case of said balance sheet as at March 31,
2002, and said statements of income and cash flows for the three months
then ended, to year-end audit adjustments, the Consolidated financial
condition of the Borrower and its Subsidiaries as at such dates and the
Consolidated results of the operations of the Borrower and its
Subsidiaries for the periods ended on such dates, all in accordance
with generally accepted accounting principles consistently applied.
(f) There is no pending or threatened action, suit,
investigation, litigation or proceeding, including, without limitation,
any Environmental Action, affecting the Borrower or any of its
Subsidiaries before any court, governmental agency or arbitrator that
(i) could be reasonably likely to have a Material Adverse Effect or
(ii) purports to affect the legality, validity or enforceability of
this Agreement or any Note or the consummation of the transactions
contemplated hereby.
(g) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U issued by the Board of Governors of the
Federal Reserve System), and no proceeds of any Advance will be used to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock.
(h) The Borrower is not an "investment company", or a
company "controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
(i) Neither this Agreement, the Information Memorandum nor
any other document delivered by or on behalf of the Borrower or any of
its Subsidiaries in connection with this Agreement or included therein
contained or contains any material misstatement of fact or omitted or
omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(j) Since December 31, 2001, there has been no Material
Adverse Change.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment hereunder or any
Letter of Credit shall be outstanding, the Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA and Environmental Laws.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Borrower nor any of its
Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to
its property and becomes enforceable against its other creditors.
(c) Maintenance of Insurance. Maintain, and cause each of
its Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which the
Borrower or such Subsidiary operates.
(d) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its corporate existence, rights (charter and statutory) and franchises;
provided, however, that the Borrower and its Subsidiaries may
consummate any merger or consolidation permitted under Section 5.02(b)
and provided further that neither the Borrower nor any of its
Subsidiaries shall be required to preserve any right or franchise if
the Board of Directors of the Borrower or such Subsidiary shall
determine that the preservation thereof is no longer desirable in the
conduct of the business of the Borrower or such Subsidiary, as the case
may be, and that the loss thereof is not disadvantageous in any
material respect to the Borrower, such Subsidiary or the Lenders.
(e) Visitation Rights. At any reasonable time during normal
business hours and from time to time upon reasonable notice, permit the
Agent or any of the Lenders or any agents or representatives thereof,
to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers and
with their independent certified public accountants.
(f) Keeping of Books. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, in which full
and correct entries shall be made of all financial transactions and the
assets and business of the Borrower and each such Subsidiary in
accordance with generally accepted accounting principles in effect from
time to time.
(g) Maintenance of Properties, Etc. Maintain and preserve,
and cause each of its Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted.
(h) Transactions with Affiliates. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
this Agreement with any of their Affiliates (other than the Borrower
and its Subsidiaries) on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate.
(i) Reporting Requirements. Furnish to the Lenders:
(i) as soon as available and in any event within 45
days after the end of each of the first three quarters of each
fiscal year of the Borrower, the Consolidated balance sheet of
the Borrower and its Subsidiaries as of the end of such
quarter and Consolidated statements of income and cash flows
of the Borrower and its Subsidiaries for the period commencing
at the end of the previous fiscal year and ending with the end
of such quarter, duly certified (subject to year-end audit
adjustments) by the chief financial officer or treasurer of
the Borrower as having been prepared in accordance with
generally accepted accounting principles and certificates of
the chief financial officer or treasurer of the Borrower as to
compliance with the terms of this Agreement and setting forth
in reasonable detail the calculations necessary to demonstrate
compliance with Section 5.03, provided that in the event of
any change in generally accepted accounting principles used in
the preparation of such financial statements, the Borrower
shall also provide within a reasonable time, if necessary for
the determination of compliance with Section 5.03, a statement
of reconciliation conforming such financial statements to
GAAP;
(ii) as soon as available and in any event within 90
days after the end of each fiscal year of the Borrower, a copy
of the annual audit report for such year for the Borrower and
its Subsidiaries, containing the Consolidated balance sheet of
the Borrower and its Subsidiaries as of the end of such fiscal
year and Consolidated statements of income and cash flows of
the Borrower and its Subsidiaries for such fiscal year, in
each case accompanied by an opinion acceptable to the Required
Lenders by PricewaterhouseCoopers LLP or other independent
public accountants acceptable to the Required Lenders and
certificates of the chief financial officer or treasurer of
the Borrower as to compliance with the terms of this Agreement
and setting forth in reasonable detail the calculations
necessary to demonstrate compliance with Section 5.03,
provided that in the event of any change in generally accepted
accounting principles used in the preparation of such
financial statements, the Borrower shall also provide within a
reasonable time, if necessary for the determination of
compliance with Section 5.03, a statement of reconciliation
conforming such financial statements to GAAP;
(iii) as soon as possible and in any event within
five days after the occurrence of each Default continuing on
the date of such statement, a statement of the chief financial
officer of the Borrower setting forth details of such Default
and the action that the Borrower has taken and proposes to
take with respect thereto;
(iv) promptly after the sending or filing thereof,
copies of all reports that the Borrower sends to any of its
securityholders, and copies of all reports and registration
statements that the Borrower or any Subsidiary files with the
Securities and Exchange Commission or any national securities
exchange;
(v) promptly after the commencement thereof, notice
of all actions and proceedings before any court, governmental
agency or arbitrator affecting the Borrower or any of its
Subsidiaries of the type described in Section 4.01(f); and
(vi) such other information respecting the Borrower
or any of its Subsidiaries as any Lender through the Agent may
from time to time reasonably request.
SECTION 5.02. Negative Covenants. So long as any Advance shall
remain unpaid or any Lender shall have any Commitment hereunder or any Letter of
Credit shall be outstanding, the Borrower will not:
(a) Liens, Etc. Create or suffer to exist, or permit any of
its Subsidiaries to create or suffer to exist, any Lien on or with
respect to any of its properties, whether now owned or hereafter
acquired, or assign, or permit any of its Subsidiaries to assign, any
right to receive income, other than:
(i) Permitted Liens,
(ii) purchase money Liens upon or in any real
property or equipment acquired or held by the Borrower or any
Subsidiary in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt
incurred solely for the purpose of financing the acquisition
of such property or equipment, or Liens existing on such
property or equipment at the time of its acquisition (other
than any such Liens created in contemplation of such
acquisition that were not incurred to finance the acquisition
of such property) or extensions, renewals or replacements of
any of the foregoing for the same or a lesser amount,
provided, however, that no such Lien shall extend to or cover
any properties of any character other than the real property
or equipment being acquired, and no such extension, renewal or
replacement shall extend to or cover any properties not
theretofore subject to the Lien being extended, renewed or
replaced, provided further that the aggregate principal amount
of the indebtedness secured by the Liens referred to in this
clause (ii) shall not exceed $100,000,000 at any time
outstanding,
(iii) the Liens existing on the Effective Date and
described on Schedule 5.02(a) hereto,
(iv) other Liens securing Debt in an aggregate
principal amount not to exceed $50,000,000,
(v) the replacement, extension or renewal of any
Lien permitted by clause (iii) above upon or in the same
property theretofore subject thereto or the replacement,
extension or renewal (without increase in the amount or change
in any direct or contingent obligor) of the Debt secured
thereby, and
(vi) Liens secured by property occupied or to be
occupied by the Borrower as its corporate headquarters,
securing obligations incurred to acquire or construct and
finishout such headquarters.
(b) Mergers, Etc. Merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or any substantial part
of its assets (whether now owned or hereafter acquired) to, any Person,
or permit any of its Subsidiaries to do so, except that (x)(i) the
Borrower or any of its Subsidiaries may sell or transfer real property
including improvements thereon in connection with a sale and leaseback
transaction, (ii) any Subsidiary of the Borrower may merge or
consolidate with or into, or dispose of assets to, any other Subsidiary
of the Borrower, (iii) any Subsidiary of the Borrower may merge into or
dispose of assets to the Borrower and (iv) the Borrower may merge with
any other Person so long as the Borrower is the surviving corporation,
provided, in each case, that no Default shall have occurred and be
continuing at the time of such proposed transaction or would result
therefrom and (y) the Borrower and its Subsidiaries may (1) sell
inventory in the ordinary course of business and (2) sell, transfer,
convey, lease or otherwise dispose of less than any substantial part of
the assets of the Borrower and its Subsidiaries, taken as a whole.
For purposes of this subsection (b), a sale, transfer, conveyance,
lease or other disposition of assets shall be deemed to be a
"substantial part" of the assets of the Borrower and its Subsidiaries
only if the value of such assets, when added to the value of all other
assets sold, transferred, conveyed, leased or otherwise disposed of by
the Borrower and its Subsidiaries (other than as expressly permitted
pursuant to this subsection (b)) during the same fiscal year, exceeds
15% of the Borrower's consolidated total assets determined as of the
end of the immediately preceding fiscal year. As used in the preceding
sentence, the term "value" shall mean, with respect to any asset
disposed of, the greater of such asset's book or fair market value as
of the date of disposition, with "book value" being the value of such
asset as would appear immediately prior to such disposition on a
balance sheet of the owner of such asset prepared in accordance with
generally accepted accounting principles.
(c) Accounting Changes. Make or permit, or permit any
of its Subsidiaries to make or permit, any change in accounting
policies or reporting practices, except as required or permitted by
generally accepted accounting principles.
(d) Change in Nature of Business. Make, or permit any of
its Subsidiaries to make, any material change in the nature of its
business as carried on at the date hereof.
(e) Investments in Other Persons. Make or hold, or permit
any of its Subsidiaries to make or hold, any Investment in any Person
other than:
(i) Investments by the Borrower and its
Subsidiaries in their Subsidiaries outstanding on the date
hereof;
(ii) loans and advances to employees in the ordinary
course of the business of the Borrower and its Subsidiaries as
presently conducted in an aggregate principal amount not to
exceed $10,000,000 at any time outstanding;
(iii) Investments in Marketable Securities;
(iv) Investments consisting of extensions or credit
in the nature of accounts receivable or notes receivable
arising from the sale of goods and services, or shares of
stock, obligations or other securities received in settlement
of claims, in each case, arising in the ordinary course of
business;
(v) Investments existing on the Effective Date and
described on Schedule 5.02(e) hereto;
(vi) deposits in bank accounts maintained for
operational purposes, within the limits established by the
Borrower's corporate cash investment policy; and
(vii) other Investments in an aggregate amount
invested not to exceed 15% of Consolidated Tangible Net Worth
at any time.
SECTION 5.03. Financial Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment hereunder or any
Letter of Credit shall be outstanding, the Borrower will:
(a) Leverage Ratio. Maintain a ratio of Consolidated
Funded Debt to Consolidated EBITDA for the period of four fiscal
quarters most recently ended of not more than the 3.0:1.0.
(b) Fixed Charge Coverage Ratio. Maintain a ratio of
Consolidated EBITDAR of the Borrower and its Subsidiaries to the sum of
(i) interest payable on, and amortization of debt discount in respect
of, all Debt during the period of four fiscal quarters most recently
ended plus (ii) rentals payable under leases of real or personal, or
mixed, property during such period, in each case, by the Borrower and
its Subsidiaries of not less than 2.0:1.0.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following
events ("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any
Advance when the same becomes due and payable; or the Borrower shall
fail to pay any interest on any Advance or make any other payment of
fees or other amounts payable under this Agreement or any Note within
three Business Days after the same becomes due and payable; or
(b) Any representation or warranty made by the Borrower
herein or by the Borrower (or any of its officers) in connection with
this Agreement shall prove to have been incorrect in any material
respect when made; or
(c) (i) The Borrower shall fail to perform or observe any
term, covenant or agreement contained in Section 5.01(d) (as to the
Borrower's corporate existence), (e), (h) or (i), 5.02 or 5.03, or (ii)
the Borrower shall fail to perform or observe any other term, covenant
or agreement contained in this Agreement on its part to be performed or
observed if such failure shall remain unremedied for 10 days after
written notice thereof shall have been given to the Borrower by the
Agent or any Lender; or
(d) The Borrower or any of its Subsidiaries shall fail to
pay any principal of or premium or interest on any Debt that is
outstanding in a principal or notional amount of at least $50,000,000 in
the aggregate (but excluding Debt outstanding hereunder) of the Borrower
or such Subsidiary (as the case may be), when the same becomes due and
payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt; or any such Debt shall be declared to be due and
payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturity
thereof; or
(e) The Borrower or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against the Borrower or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, custodian or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of 30
days, or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
for, it or for any substantial part of its property) shall occur; or
the Borrower or any of its Subsidiaries shall take any corporate action
to authorize any of the actions set forth above in this subsection (e);
or
(f) Judgments or orders for the payment of money in excess
of $50,000,000 in the aggregate shall be rendered against the Borrower
or any of its Subsidiaries and either (i) enforcement proceedings shall
have been commenced by any creditor upon such judgment or order or (ii)
there shall be any period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; provided, however, that any such
judgment or order shall not be an Event of Default under this Section
6.01(f) if and for so long as (i) the amount of such judgment or order
is covered by a valid and binding policy of insurance between the
defendant and the insurer covering payment thereof and (ii) such
insurer, which shall be rated at least "A" by A.M. Best Company, has
been notified of, and has not disputed the claim made for payment of,
the amount of such judgment or order; or
(g) (i) Any Person or two or more Persons acting in concert
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934), directly or indirectly, of Voting Stock of the
Borrower (or other securities convertible into such Voting Stock)
representing 20% or more of the combined voting power of all Voting
Stock of the Borrower; or (ii) during any period of up to 24
consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month period
were directors of the Borrower shall cease for any reason to constitute
a majority of the board of directors of the Borrower (except to the
extent that individuals who at the beginning of such 24-month period
were replaced by individuals (x) elected by 66-2/3% of the remaining
members of the board of directors of the Borrower or (y) nominated for
election by a majority of the remaining members of the board of
directors of the Borrower and thereafter elected as directors by the
shareholders of the Borrower); or
(i) The Borrower or any of its ERISA Affiliates shall incur,
or shall be reasonably likely to incur, liability in excess of
$50,000,000 in the aggregate as a result of one or more of the
following: (i) the occurrence of any ERISA Event; (ii) the partial or
complete withdrawal of the Borrower or any of its ERISA Affiliates from
a Multiemployer Plan; or (iii) the reorganization or termination of a
Multiemployer Plan;
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
obligation of each Lender to make Advances (other than Revolving Credit Advances
by an Issuing Bank or a Lender pursuant to Section 2.02(b)) and of the Issuing
Banks to issue Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the consent, of
the Required Lenders, by notice to the Borrower, declare the Advances, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Advances, all such interest and all
such amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to the Borrower under the
Federal Bankruptcy Code, (A) the obligation of each Lender to make Advances
(other than Revolving Credit Advances by an Issuing Bank or a Lender pursuant to
Section 2.02(b)) and of the Issuing Banks to issue Letters of Credit shall
automatically be terminated and (B) the Advances, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.
SECTION 6.02. Actions in Respect of the Letters of Credit upon
Default. If any Event of Default shall have occurred and be continuing, the
Agent may with the consent, or shall at the request, of the Required Lenders,
irrespective of whether it is taking any of the actions described in Section
6.01 or otherwise, make demand upon the Borrower to, and forthwith upon such
demand the Borrower will, (a) pay to the Agent on behalf of the Lender Parties
in same day funds at the Agent's office designated in such demand, for deposit
in the L/C Cash Collateral Account, an amount equal to the aggregate Available
Amount of all Letters of Credit then outstanding or (b) make such other
arrangements in respect of the outstanding Letters of Credit as shall be
acceptable to the Required Lenders. If at any time the Agent determines that any
funds held in the L/C Cash Collateral Account are subject to any right or claim
of any Person other than the Agent and the Lender Parties or that the total
amount of such funds is less than the aggregate Available Amount of all Letters
of Credit, the Borrower will, forthwith upon demand by the Agent, pay to the
Agent, as additional funds to be deposited and held in the L/C Cash Collateral
Account, an amount equal to the excess of (a) such aggregate Available Amount
over (b) the total amount of funds, if any, then held in the L/C Cash Collateral
Account that the Agent determines to be free and clear of any such right and
claim. Upon the drawing of any Letter of Credit, to the extent funds are on
deposit in the L/C Cash Collateral Account, such funds shall be applied to
reimburse the Issuing Banks to the extent permitted by applicable law.
ARTICLE VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Lender (in its
capacities as a Lender and Issuing Bank (as applicable)) hereby appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement or collection of the
Notes), the Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; provided, however, that the Agent shall not be
required to take any action that exposes the Agent to personal liability or that
is contrary to this Agreement or applicable law. The Agent agrees to give to
each Lender prompt notice of each notice given to it by the Borrower pursuant to
the terms of this Agreement.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agent: (i) may treat
the Lender that made any Advance as the holder of the Debt resulting therefrom
until the Agent receives and accepts an Assumption Agreement entered into by an
Assuming Lender as provided in Section 2.19 or an Assignment and Acceptance
entered into by such Lender, as assignor, and an Eligible Assignee, as assignee,
as provided in Section 8.07; (ii) may consult with legal counsel (including
counsel for the Borrower), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) shall not have any duty to ascertain or to inquire as to the
performance, observance or satisfaction of any of the terms, covenants or
conditions of this Agreement on the part of the Borrower or the existence at any
time of any Default or to inspect the property (including the books and records)
of the Borrower; (v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, this Agreement or any other
instrument or document furnished pursuant hereto; and (vi) shall incur no
liability under or in respect of this Agreement by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telecopier,
telegram or telex) believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 7.03. Citibank and Affiliates. With respect to its
Commitment, the Advances made by it and the Note issued to it, Citibank shall
have the same rights and powers under this Agreement as any other Lender and may
exercise the same as though it were not the Agent; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated, include Citibank in its
individual capacity. Citibank and its Affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, the
Borrower, any of its Subsidiaries and any Person who may do business with or own
securities of the Borrower or any such Subsidiary, all as if Citibank were not
the Agent and without any duty to account therefor to the Lenders. The Agent
shall have no duty to disclose information obtained or received by it or any of
its Affiliates relating to the Borrower or its Subsidiaries to the extent such
information was obtained or received in any capacity other than as Agent.
SECTION 7.04. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Agent or any other
Lender and based on the financial statements referred to in Section 4.01 and
such other 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 Agent 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.
SECTION 7.05. Indemnification. (a) The Lenders ratably agree
to indemnify the Agent (to the extent not reimbursed by the Borrower) from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the
Agent in any way relating to or arising out of this Agreement or any action
taken or omitted by the Agent under this Agreement (collectively, the
"Indemnified Costs"), provided that no Lender shall be liable for any portion of
the Indemnified Costs resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender agrees to reimburse
the Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including reasonable counsel fees) incurred by the Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement, to the extent that the Agent is not reimbursed for such expenses
by the Borrower. In the case of any investigation, litigation or proceeding
giving rise to any Indemnified Costs, this Section 7.05 applies whether any such
investigation, litigation or proceeding is brought by the Agent, any Lender or a
third party.
(b) Each Lender severally agrees to indemnify the Issuing
Banks (to the extent not promptly reimbursed by the Borrower) from and against
such Lender's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against any such Issuing Bank in any way
relating to or arising out of this Agreement or any action taken or omitted by
such Issuing Bank hereunder or in connection herewith; provided, however, that
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Issuing Bank's gross negligence or willful
misconduct as found in a final, non-appealable judgment by a court of competent
jurisdiction. Without limitation of the foregoing, each Lender agrees to
reimburse any such Issuing Bank promptly upon demand for its ratable share of
any costs and expenses (including, without limitation, reasonable fees and
expenses of counsel) payable by the Borrower under Section 8.04, to the extent
that such Issuing Bank is not promptly reimbursed for such costs and expenses by
the Borrower.
(c) For purposes of this Section 7.05, the Lenders'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
(other than Competitive Bid Advances) outstanding at such time and owing to the
respective Lenders, (ii) their respective Pro Rata Shares of the aggregate
Available Amount of all Letters of Credit outstanding at such time and (iii)
their respective Unused Commitments at such time; provided that the aggregate
principal amount of Revolving Credit Advances owing to the Issuing Banks as a
result of drawings under Letters of Credit shall be considered to be owed to the
Lenders ratably in accordance with their respective Revolving Credit
Commitments. The failure of any Lender to reimburse the Agent or any such
Issuing Bank, as the case may be, promptly upon demand for its ratable share of
any amount required to be paid by the Lenders to the Agent or such Issuing Bank,
as the case may be, as provided herein shall not relieve any other Lender of its
obligation hereunder to reimburse the Agent or such Issuing Bank, as the case
may be, for its ratable share of such amount, but no Lender shall be responsible
for the failure of any other Lender to reimburse the Agent or any such Issuing
Bank, as the case may be, for such other Lender's ratable share of such amount.
Without prejudice to the survival of any other agreement of any Lender
hereunder, the agreement and obligations of each Lender contained in this
Section 7.05 shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under the Notes.
SECTION 7.06. Successor Agent. The Agent may resign at any
time by giving written notice thereof to the Lenders and the Borrower and may be
removed at any time with or without cause by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent. If no successor Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days after
the retiring Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement.
SECTION 7.07. Other Agents. Each Lender hereby acknowledges
that neither the documentation agent nor any other Lender designated as any
"Agent" on the signature pages hereof has any liability hereunder other than in
its capacity as a Lender.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Revolving Credit Notes, nor consent to any
departure by the Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no amendment, waiver
or consent shall, unless in writing and signed by all the Lenders, do any of the
following: (a) waive any of the conditions specified in Section 3.01, (b)
increase the Commitments of the Lenders, (c) reduce the principal of, or
interest on, the Revolving Credit Advances or any fees or other amounts payable
hereunder, (d) postpone any date fixed for any payment of principal of, or
interest on, the Revolving Credit Advances or any fees or other amounts payable
hereunder, (e) change the percentage of the Revolving Credit Commitments, the
aggregate Available Amount of outstanding Letters of Credit or the aggregate
unpaid principal amount of the Revolving Credit Advances, or the number of
Lenders, that shall be required for the Lenders or any of them to take any
action hereunder or (f) amend this Section 8.01; and provided further that no
amendment, waiver or consent shall, unless in writing and signed by the Agent in
addition to the Lenders required above to take such action, affect the rights or
duties of the Agent under this Agreement or any Note; and provided further that
no amendment, waiver or consent shall, unless in writing and signed by the
Issuing Banks in addition to the Lenders required above to take such action,
affect the rights or obligation of the Issuing Banks under this Agreement.
SECTION 8.02. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing (including telecopier,
telegraphic or telex communication) and mailed, telecopied, telegraphed, telexed
or delivered, if to the Borrower, at its address at 100 Throckmorton Street,
Suite 1800, Fort Worth, Texas 76102, Attention: Martin Moad, Treasurer; if to
any Initial Lender, at its Domestic Lending Office specified opposite its name
on Schedule I hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assumption Agreement or the Assignment and Acceptance pursuant
to which it became a Lender; and if to the Agent, at its address at Two Penns
Way, New Castle, Delaware 19720, Attention: Bank Loan Syndications Department;
or, as to the Borrower or the Agent, at such other address as shall be
designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower and the Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed or telexed, be
effective when deposited in the mails, telecopied, delivered to the telegraph
company or confirmed by telex answerback, respectively, except that notices and
communications to the Agent pursuant to Article II, III or VII shall not be
effective until received by the Agent. Delivery by telecopier of an executed
counterpart of any amendment or waiver of any provision of this Agreement or the
Notes or of any Exhibit hereto to be executed and delivered hereunder shall be
effective as delivery of a manually executed counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of
any Lender or the Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to
pay on demand all reasonable costs and expenses of the Agent in connection with
the preparation, execution, delivery, administration, modification and amendment
of this Agreement, the Notes and the other documents to be delivered hereunder,
including, without limitation, (A) all reasonable due diligence, syndication
(including printing, distribution and bank meetings), transportation, computer,
duplication, appraisal, consultant, and audit expenses and (B) the reasonable
fees and expenses of counsel for the Agent with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under this
Agreement. The Borrower further agrees to pay on demand all costs and expenses
of the Agent and the Lenders, if any (including, without limitation, reasonable
counsel fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement, the Notes and
the other documents to be delivered hereunder, including, without limitation,
reasonable fees and expenses of counsel for the Agent and each Lender in
connection with the enforcement of rights under this Section 8.04(a).
(b) The Borrower agrees to indemnify and hold harmless the
Agent and each Lender and each of their Affiliates and their officers,
directors, employees, agents and advisors (each, an "Indemnified Party") from
and against any and all claims, damages, losses, liabilities and expenses
(including, without limitation, reasonable fees and expenses of counsel)
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation or proceeding or
preparation of a defense in connection therewith) (i) the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances or the Letters of Credit or (ii) the actual or alleged
presence of Hazardous Materials on any property of the Borrower or any of its
Subsidiaries or any Environmental Action relating in any way to the Borrower or
any of its Subsidiaries, except to the extent such claim, damage, loss,
liability or expense is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 8.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by the Borrower, its directors, equityholders or creditors
or an Indemnified Party or any other Person, whether or not any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. The Borrower also agrees not to assert any
claim for special, indirect, consequential or punitive damages against the
Agent, any Lender, any of their Affiliates, or any of their respective
directors, officers, employees, attorneys and agents, on any theory of
liability, arising out of or otherwise relating to the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance or LIBO Rate Advance is made by the Borrower to or for
the account of a Lender other than on the last day of the Interest Period for
such Advance, as a result of a payment or Conversion pursuant to Section 2.09(d)
or (e), 2.11 or 2.13, acceleration of the maturity of the Notes pursuant to
Section 6.01 or for any other reason, or by an Eligible Assignee to a Lender
other than on the last day of the Interest Period for such Advance upon an
assignment of rights and obligations under this Agreement pursuant to Section
8.07 as a result of a demand by the Borrower pursuant to Section 8.07(a), the
Borrower shall, upon demand by such Lender (with a copy of such demand to the
Agent), pay to the Agent for the account of such Lender any amounts required to
compensate such Lender for any additional losses, costs or expenses that it may
reasonably incur as a result of such payment or Conversion, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance. The loss of a Lender shall include an amount equal to the
excess, if any, as reasonably determined by such Lender of (A) its cost of
obtaining the funds for the Advance paid or Converted on other than the last day
of an Interest Period, to the last day of such Interest Period over (B) the
amount of interest (as reasonably determined by such Lender) that could be
realized by such Lender in reemploying during such period the funds paid or
Converted.
(d) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in Sections 2.12, 2.15 and 8.04 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the Notes.
SECTION 8.05. Right of Set-off. Upon (i) the occurrence and
during the continuance of any Event of Default and (ii) the making of the
request or the granting of the consent specified by Section 6.01 to authorize
the Agent to declare the Advances due and payable pursuant to the provisions of
Section 6.01, 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 indebtedness at any time owing by such
Lender or such Affiliate to or for the credit or the account of the Borrower
against any and all of the obligations of the Borrower now or hereafter existing
under this Agreement and the Note held by such Lender, whether or not such
Lender shall have made any demand under this Agreement or such Note and although
such obligations may be unmatured. Each Lender agrees promptly to notify the
Borrower after any such set-off and application, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The rights of each Lender and its Affiliates under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender and its Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall become
effective (other than Sections 2.01 and 2.03, which shall only become effective
upon satisfaction of the conditions precedent set forth in Section 3.01) when it
shall have been executed by the Borrower and the Agent and when the Agent shall
have been notified by each Initial Lender that such Initial Lender has executed
it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agent and each Lender and their respective successors and assigns,
except that the Borrower shall not have the right to assign its rights hereunder
or any interest herein without the prior written consent of the Lenders.
SECTION 8.07. Assignments and Participations. (a) Each Lender
may and, if demanded by the Borrower (following a demand by such Lender pursuant
to Section 2.12 or 2.15, or an assertion by such Lender of illegality under
Section 2.13) upon at least five Business Days' notice to such Lender and the
Agent, will assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Revolving Credit Commitment, the Revolving Credit Advances owing
to it and the Revolving Credit Note or Notes held by it); provided, however,
that (i) each such assignment shall be of a constant, and not a varying,
percentage of all rights and obligations under this Agreement (other than any
right to make Competitive Bid Advances, Competitive Bid Advances owing to it and
Competitive Bid Notes), (ii) except in the case of an assignment to a Person
that, immediately prior to such assignment, was a Lender or an assignment of all
of a Lender's rights and obligations under this Agreement, the amount of the
Revolving Credit Commitment of the assigning Lender being assigned pursuant to
each such assignment (determined as of the date of the Assignment and Acceptance
with respect to such assignment) shall in no event be less than $10,000,000 or
an integral multiple of $1,000,000 in excess thereof unless the Borrower and the
Agent otherwise agree, (iii) each such assignment shall be to an Eligible
Assignee, (iv) each such assignment made as a result of a demand by the Borrower
pursuant to this Section 8.07(a) shall be arranged by the Borrower after
consultation with the Agent and shall be either an assignment of all of the
rights and obligations of the assigning Lender under this Agreement or an
assignment of a portion of such rights and obligations made concurrently with
another such assignment or other such assignments that together cover all of the
rights and obligations of the assigning Lender under this Agreement, (v) no
Lender shall be obligated to make any such assignment as a result of a demand by
the Borrower pursuant to this Section 8.07(a) unless and until such Lender shall
have received one or more payments from either the Borrower or one or more
Eligible Assignees in an aggregate amount at least equal to the aggregate
outstanding principal amount of the Advances owing to such Lender, together with
accrued interest thereon to the date of payment of such principal amount and all
other amounts payable to such Lender under this Agreement, and (vi) the parties
to each such assignment shall execute and deliver to the Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Revolving Credit Note subject to such assignment and a processing and
recordation fee of $3,500 payable by the parties to each such assignment,
provided, however, that in the case of each assignment made as a result of a
demand by the Borrower, such recordation fee shall be payable by the Borrower
except that no such recordation fee shall be payable in the case of an
assignment made at the request of the Borrower to an Eligible Assignee that is
an existing Lender, and (vii) any Lender may, without the approval of the
Borrower and the Agent, assign all or a portion of its rights to any of its
Affiliates. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, (x) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights (other than its rights under Sections 2.12, 2.15 and 8.04
to the extent any claim thereunder relates to an event arising prior such
assignment) and be released from its obligations under this Agreement (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).
(b) By executing and delivering an Assignment and
Acceptance, the Lender assignor thereunder and the assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Acceptance, 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, or the perfection or priority of any lien or security
interest created or purported to be created under or in connection with, this
Agreement or any other instrument or document furnished pursuant hereto; (ii)
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to 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 confirms that it has received a copy of this Agreement, together
with copies of the financial statements referred to in Section 4.01 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; (iv)
such assignee will, independently and without reliance upon the 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; (v) such assignee
confirms that it is an Eligible Assignee; (vi) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Agreement are required to be performed by it as a Lender or as an Issuing Bank,
as the case may be.
(c) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee representing that it is an
Eligible Assignee, together with any Revolving Credit Note or Notes subject to
such assignment, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit C hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower.
(d) The Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assumption Agreement and each Assignment and
Acceptance delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitment of, and principal
amount of the Advances owing to, each Lender from time to time (the "Register").
The entries in the Register shall be conclusive and binding for all purposes,
absent demonstrable error, and the Borrower, the Agent and the Lenders may treat
each Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Each Lender may sell participations to one or more banks
or other entities (other than the Borrower or any of its Affiliates) in or to
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitments, the Advances owing to
it and any Note or Notes held by it); provided, however, that (i) such Lender's
obligations under this Agreement (including, without limitation, its Revolving
Credit Commitment to the Borrower hereunder) shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender shall remain the holder of
any such Note for all purposes of this Agreement, (iv) the Borrower, the Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement and (v) no participant under any such participation shall have any
right to approve any amendment or waiver of any provision of this Agreement or
any Note, or any consent to any departure by the Borrower therefrom, except to
the extent that such amendment, waiver or consent would reduce the principal of,
or interest on, the Advances or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation, or postpone any date
fixed for any payment of principal of, or interest on, the Advances or any fees
or other amounts payable hereunder, in each case to the extent subject to such
participation.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, 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,
the assignee or participant or proposed assignee or participant shall agree to
preserve the confidentiality of any Confidential Information relating to the
Borrower received by it from such Lender.
(g) Each Issuing Bank may assign to an Eligible Assignee its
rights and obligations or any portion of the undrawn Letter of Credit Commitment
at any time; provided, however, that (i) the amount of the Letter of Credit
Commitment of the assigning Issuing Bank being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $1,000,000 or an
integral multiple of $1,000,000 in excess thereof, and (ii) the parties to each
such assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with a
processing and recordation fee of $3,500.
(h) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Advances owing to it and any Note or Notes held by it) in favor of any Federal
Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
SECTION 8.08. Confidentiality. Neither the Agent nor any
Lender shall disclose any Confidential Information to any other Person without
the written consent of the Borrower, other than (a) to the Agent's or such
Lender's Affiliates and to their officers, directors, employees, agents and
advisors as are necessary and appropriate for the administration of this
Agreement and, as contemplated by Section 8.07(f), to actual or prospective
assignees and participants, and then only on a confidential basis, (b) as
required by any law, rule or regulation or judicial process, (c) as requested or
required by any state, federal or foreign authority or examiner regulating banks
or banking and (d) 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.
SECTION 8.09. Governing Law. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 8.10. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the Notes, or for recognition or enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the extent permitted by law, in such federal court. The Borrower does business
in the State of New York through numerous locations in such State. The Borrower
has appointed Ct Corporation System as its agent for service of process in the
State of New York, and until such time as the Borrower notifies the Agent of a
change in agent for service of process, the Borrower hereby agrees that service
of process in any such action or proceeding brought in the any such New York
State court or in such federal court may be made upon CT Corporation System at
its offices at 111 Eighth Avenue, 13th Floor, New York, New York 10011 (the
"Process Agent") and agrees that the failure of the Process Agent to give any
notice of any such service shall not impair or affect the validity of such
service or of any judgment rendered in any action or proceeding based thereon.
The Borrower shall give the Agent notice of any change in agent for service of
process in the State of New York. The Borrower hereby further irrevocably
consents to the service of process in any action or proceeding in such courts by
the mailing thereof by any parties hereto by registered or certified mail,
postage prepaid, to the Borrower at its address specified pursuant to Section
8.02. Each of the parties hereto agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or the Notes in the courts of
any jurisdiction.
(b) Each of the parties hereto irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
the Notes in any New York State or federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
SECTION 8.12. No Liability of the Issuing Banks. The Borrower
assumes all risks of the acts or omissions of any beneficiary or transferee of
any Letter of Credit with respect to its use of such Letter of Credit. Neither
an Issuing Bank nor any of its officers or directors shall be liable or
responsible for: (a) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith; (b)
the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by such Issuing Bank
against presentation of documents that do not comply with the terms of a Letter
of Credit, including failure of any documents to bear any reference or adequate
reference to the Letter of Credit; or (d) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit, except that the
Borrower shall have a claim against such Issuing Bank, and such Issuing Bank
shall be liable to the Borrower, to the extent of any direct, but not
consequential, damages suffered by the Borrower that the Borrower proves were
caused by (i) such Issuing Bank's willful misconduct or gross negligence as
determined in a final, non-appealable judgment by a court of competent
jurisdiction in determining whether documents presented under any Letter of
Credit comply with the terms of such Letter of Credit or (ii) such Issuing
Bank's willful failure to make lawful payment under a Letter of Credit after the
presentation to it of a draft and certificates strictly complying with the terms
and conditions of the Letter of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Bank may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary.
SECTION 8.13. Waiver of Jury Trial. Each of the Borrower, the
Agent and the Lenders hereby irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement or the Notes or the
actions of the Agent or any Lender in the negotiation, administration,
performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
RADIOSHACK CORPORATION
By __________________________
Title:
CITIBANK, N.A.,
as Agent
By __________________________
Title:
Initial Issuing Banks
Letter of Credit Commitment
$50,000,000 BANK OF AMERICA, N.A.
By __________________________
Title:
$50,000,000 WACHOVIA BANK, NATIONAL ASSOCIATION
By __________________________
Title:
$100,000,000 Total of the Letter of Credit Commitments
Initial Lenders
Commitment
$37,500,000 CITIBANK, N.A.
By __________________________
Title:
$37,500,000 BANK OF AMERICA, N.A.
By __________________________
Title:
$32,500,000 FLEET NATIONAL BANK
By __________________________
Title:
$32,500,000 WACHOVIA BANK, NATIONAL ASSOCIATION
By __________________________
Title:
$12,500,000 FIFTH THIRD BANK
By __________________________
Title:
$12,500,000 SUNTRUST BANK
By __________________________
Title:
$12,500,000 U.S. BANK NATIONAL ASSOCIATION
By __________________________
Title:
$7,500,000 HIBERNIA NATIONAL BANK
By __________________________
Title:
$20,000,000 ROYAL BANK OF CANADA
By __________________________
Title:
$12,500,000 KEYBANK NATIONAL ASSOCIATION
By __________________________
Title:
$12,500,000 NATIONAL CITY BANK
By __________________________
Title:
$12,500,000 WELLS FARGO BANK, NATIONAL ASSOCIATION
By __________________________
Title:
$7,500,000 HUNTINGTON NATIONAL BANK
By __________________________
Title:
$12,500,000 BANCA NAZIONALE DEL LAVORO
By __________________________
Title:
$25,000,000 THE BANK OF NEW YORK
By __________________________
Title:
$12,500,000 BANK OF TOKYO MITSUBISHI TRUST COMPANY
By __________________________
Title:
$300,000,000 Total of the Commitments
SCHEDULE I
RADIOSHACK CORPORATION
FIVE YEAR CREDIT AGREEMENT
APPLICABLE LENDING OFFICES
------------------------------------------ --------------------------------------- -----------------------------------
Name of Initial Lender Domestic Lending Office Eurodollar Lending Office
------------------------------------------ --------------------------------------- -----------------------------------
------------------------------------------ --------------------------------------- -----------------------------------
Banca Nazionale del Lavoro 25 West 51st Street 25 West 51st Street
New York, NY 10019 New York, NY 10019
Attn: Anna Hernandez Attn: Anna Hernandez
T: 212 314-679 T: 212 314-679
F: 212 765-2978 F: 212 765-2978
------------------------------------------ --------------------------------------- -----------------------------------
Bank of America, N.A. 1850 Gateway Blvd, 5th Floor 1850 Gateway Blvd, 5th Floor
Concord, CA 84520 Concord, CA 84520
Attn: Jessical Voulgarelis Attn: Jessical Voulgarelis
T: 925 675-7817 T: 925 675-7817
F; 888 969-9317 F; 888 969-9317
------------------------------------------ --------------------------------------- -----------------------------------
Bank of New York One Wall Street One Wall Street
New York, NY 10286 New York, NY 10286
Attn: Madlyn Myrick Attn: Madlyn Myrick
T: 212 635-1366 T: 212 635-1366
F: 212 635-1481 F: 212 635-1481
------------------------------------------ --------------------------------------- -----------------------------------
Bank of Tokyo Mistubishi Trust Company 1251 Avenue of the Americas 1251 Avenue of the Americas
New York, NY 10020 New York, NY 10020
Attn: Paresh Shah Attn: Paresh Shah
T: 212 782-5649 T: 212 782-5649
F: 212 782-6440 F: 212 782-6440
------------------------------------------ --------------------------------------- -----------------------------------
Citibank, N.A. Two Penns Way, Suite 200 Two Penns Way, Suite 200
New Castle, DE 19720 New Castle, DE 19720
Attn: Vincent Farrell Attn: Vincent Farrell
T: 302 894-6032 T: 302 894-6032
F: 302 894-6120 F: 302 894-6120
------------------------------------------ --------------------------------------- -----------------------------------
Fifth Third Bank 38 Fountain Square Plaza 38 Fountain Square Plaza
MD 10904 MD 10904
Cincinnati, OH 45263 Cincinnati, OH 45263
Attn: Chris Motley Attn: Chris Motley
T: 513 579-4110 T: 513 579-4110
F: 513 744-5947 F: 513 744-5947
------------------------------------------ --------------------------------------- -----------------------------------
Fleet National Bank 100 Federal Street 100 Federal Street
MADE 10809A MADE 10809A
Boston, MA 02110 Boston, MA 02110
Attn: Kalams Herald Attn: Kalams Herald
T: 617 434-3780 T: 617 434-3780
F: 617 434-9933 F: 617 434-9933
------------------------------------------ --------------------------------------- -----------------------------------
Hibernia National Bank 313 Carondelet Street 313 Carondelet Street
New Orleans, LA 70130 New Orleans, LA 70130
Attn: Shelly Strada Attn: Shelly Strada
T: 504 533-2808 T: 504 533-2808
F: 504 533-5344 F: 504 533-5344
------------------------------------------ --------------------------------------- -----------------------------------
------------------------------------------ --------------------------------------- -----------------------------------
Huntington National Bank The Huntington Center The Huntington Center
Columbus, OH 43287 Columbus, OH 43287
Attn: Lori Scott Attn: Lori Scott
T: 614 480-5778 T: 614 480-5778
F: 614 480-5791 F: 614 480-5791
------------------------------------------ --------------------------------------- -----------------------------------
KeyBank National Association 127 Public Square 127 Public Square
Cleveland, OH 44114 Cleveland, OH 44114
Attn: Laura Binkley Attn: Laura Binkley
T: 216 689-4448 T: 216 689-4448
F: 216 689-4981 F: 216 689-4981
------------------------------------------ --------------------------------------- -----------------------------------
National City Bank 155 East Broad Street 155 East Broad Street
Columbus, OH Columbus, OH
Attn: Vicki Niemela Attn: Vicki Niemela
T: 614 463-7133 T: 614 463-7133
F: 614 463-8572 F: 614 463-8572
------------------------------------------ --------------------------------------- -----------------------------------
Royal Bank of Canada One Liberty Plaza, 3rd Floor One Liberty Plaza, 3rd Floor
New York, NY 10006 New York, NY 10006
Attn: Ritta Lee Attn: Ritta Lee
T: 212 428-6448 T: 212 428-6448
F: 212 428-6459 F: 212 428-6459
------------------------------------------ --------------------------------------- -----------------------------------
SunTrust Bank 303 Peachtree Street, 10th Floor 303 Peachtree Street, 10th Floor
Atlanta, GA Atlanta, GA
Attn: Roshawn Orise Attn: Roshawn Orise
T: 404 230-1939 T: 404 230-1939
F: 4040 575-2730 F: 4040 575-2730
------------------------------------------ --------------------------------------- -----------------------------------
U.S. Bank National Association 400 City Center 400 City Center
Mail Code: OS-WI-CCO Mail Code: OS-WI-CCO
Oshkosh, WI 54901 Oshkosh, WI 54901
Attn: Connie Sweeney Attn: Connie Sweeney
T: 920 237-7604 T: 920 237-7604
F: 920 237-7993 F: 920 237-7993
------------------------------------------ --------------------------------------- -----------------------------------
Wachovia Bank, National Association 201 S. College Street, CP-17 201 S. College Street, CP-17
Charlotte, NC 28288 Charlotte, NC 28288
Attn: Cynthia Rawson Attn: Cynthia Rawson
T: 704 374-4425 T: 704 374-4425
F: 704 383-7997 F: 704 383-7997
------------------------------------------ --------------------------------------- -----------------------------------
Wells Fargo Bank, National Association 201 Third Street, 8th Floor 201 Third Street, 8th Floor
MAC A0187-081 MAC A0187-081
San Francisco, CA 94103 San Francisco, CA 94103
Attn: Rosanna Roxas Attn: Rosanna Roxas
T: 415 477-5425 T: 415 477-5425
F: 415 979-0675 F: 415 979-0675
------------------------------------------ --------------------------------------- -----------------------------------
Schedule 5.02(e)
Investments as of June 19, 2002
----------------------------------------------------- ------------------------------------- --------------------------
Investment made as part of a community effort to Note amount $
provide low income housing, including a note Ltd. Partnership 330,000.00
maturing on 9-30-2022, and a limited partnership $
interest. 1,598,375.00
----------------------------------------------------- ------------------------------------- --------------------------
World Wide Electronic Imports S. de R.L. de C.V. $
7,653,410.00
----------------------------------------------------- ------------------------------------- --------------------------
Total investments $
9,581,785.00
----------------------------------------------------- ------------------------------------- --------------------------
Schedule 5.02(a)
Existing Liens
None
EXHIBIT A-1 - FORM OF
REVOLVING CREDIT
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, 200_
FOR VALUE RECEIVED, the undersigned, Radioshack Corporation, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office on the Termination Date (each as defined in the Credit Agreement
referred to below) the principal sum of U.S.$[amount of the Lender's Commitment
in figures] or, if less, the aggregate principal amount of the Revolving Credit
Advances made by the Lender to the Borrower pursuant to the Five Year Credit
Agreement dated as of June 19, 2002 among the Borrower, the Lender and certain
other lenders parties thereto, Bank of America, N.A., as administrative agent,
Fleet National Bank, as syndication agent, Wachovia Bank, National Association,
as documentation agent, Salomon Smith Barney Inc. and Banc of America Securities
Inc., as joint lead arrangers and bookrunners, and Citibank, N.A., as Agent for
the Lender and such other lenders (as amended or modified from time to time, the
"Credit Agreement"; the terms defined therein being used herein as therein
defined) outstanding on such date.
The Borrower promises to pay interest on the unpaid principal
amount of each Revolving Credit Advance from the date of such Revolving Credit
Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to Citibank, as Agent, at 388 Greenwich Street, New
York, New York 10013, in same day funds. Each Revolving Credit Advance owing to
the Lender by the Borrower pursuant to the Credit Agreement, and all payments
made on account of principal thereof, shall be recorded by the Lender and, prior
to any transfer hereof, endorsed on the grid attached hereto which is part of
this Promissory Note.
This Promissory Note is one of the Revolving Credit Notes
referred to in, and is entitled to the benefits of, the Credit Agreement. The
Credit Agreement, among other things, (i) provides for the making of Revolving
Credit Advances by the Lender to the Borrower from time to time in an aggregate
amount not to exceed at any time outstanding the U.S. dollar amount first above
mentioned, the indebtedness of the Borrower resulting from each such Revolving
Credit Advance being evidenced by this Promissory Note and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof upon the terms and conditions therein specified.
RADIOSHACK CORPORATION
By __________________________
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
-------------------------- ------------------------ ------------------------ ------------------------- ------------------------
Amount of
Date Amount of Principal Paid Unpaid Principal Notation
Advance or Prepaid Balance Made By
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
--------------------------- ------------------------ ------------------------ ------------------------- ------------------------
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EXHIBIT A-2 - FORM OF
COMPETITIVE BID
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, 200_
FOR VALUE RECEIVED, the undersigned, Radioshack Corporation, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office (as defined in the Five Year Credit Agreement dated as of June
19, 2002 among the Borrower, the Lender and certain other lenders parties
thereto, Bank of America, N.A., as administrative agent, Fleet National Bank, as
syndication agent, Wachovia Bank, National Association, as documentation agent,
Salomon Smith Barney Inc. and Banc of America Securities Inc., as joint lead
arrangers and bookrunners, and Citibank, N.A., as Agent for the Lender and such
other lenders (as amended or modified from time to time, the "Credit Agreement";
the terms defined therein being used herein as therein defined)), on
_______________, 200_, the principal amount of U.S.$_______________].
The Borrower promises to pay interest on the unpaid principal
amount hereof from the date hereof until such principal amount is paid in full,
at the interest rate and payable on the interest payment date or dates provided
below:
Interest Rate: _____% per annum (calculated on the basis of a year
of _____ days for the actual number of days elapsed).
Both principal and interest are payable in lawful money of the
United States of America to Citibank, as agent, for the account of the Lender at
the office of Citibank, at 388 Greenwich Street, New York, New York 10013 in
same day funds.
This Promissory Note is one of the Competitive Bid Notes
referred to in, and is entitled to the benefits of, the Credit Agreement. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events.
The Borrower hereby waives presentment, demand, protest and
notice of any kind. No failure to exercise, and no delay in exercising, any
rights hereunder on the part of the holder hereof shall operate as a waiver of
such rights.
This Promissory Note shall be governed by, and construed in
accordance with, the laws of the State of New York.
RADIOSHACK CORPORATION
By __________________________
Title:
EXHIBIT B-1 - FORM OF NOTICE OF
REVOLVING CREDIT BORROWING
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Two Penns Way
New Castle, Delaware 19720
[Date]
Attention: Bank Loan Syndications Department
Ladies and Gentlemen:
The undersigned, Radioshack Corporation, refers to the Five
Year Credit Agreement, dated as of June 19, 2002 (as amended or modified from
time to time, the "Credit Agreement", the terms defined therein being used
herein as therein defined), among the undersigned, certain Lenders parties
thereto, Bank of America, N.A., as administrative agent, Fleet National Bank, as
syndication agent, Wachovia Bank, National Association, as documentation agent,
Salomon Smith Barney Inc. and Banc of America Securities Inc., as joint lead
arrangers and bookrunners, and Citibank, N.A., as Agent for said Lenders, and
hereby gives you notice, irrevocably, pursuant to Section 2.02 of the Credit
Agreement that the undersigned hereby requests a Revolving Credit Borrowing
under the Credit Agreement, and in that connection sets forth below the
information relating to such Revolving Credit Borrowing (the "Proposed Revolving
Credit Borrowing") as required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Revolving Credit
Borrowing is _______________, 200_.
(ii) The Type of Advances comprising the Proposed Revolving
Credit Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Revolving Credit
Borrowing is $_______________.
[(iv) The initial Interest Period for each Eurodollar Rate
Advance made as part of the Proposed Revolving Credit Borrowing is
_____ month[s].]
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed
Revolving Credit Borrowing:
(A) the representations and warranties contained in Section
4.01(a) through (i) of the Credit Agreement are correct, before and
after giving effect to the Proposed Revolving Credit Borrowing and to
the application of the proceeds therefrom, as though made on and as of
such date; and
(B) no event has occurred and is continuing, or would result
from such Proposed Revolving Credit Borrowing or from the application
of the proceeds therefrom, that constitutes a Default.
Very truly yours,
RADIOSHACK CORPORATION
By __________________________
Title:.
EXHIBIT B-2 - FORM OF NOTICE OF
COMPETITIVE BID BORROWING
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Two Penns Way
New Castle, Delaware 19720
[Date]
Attention: Bank Loan Syndications Department
Ladies and Gentlemen:
The undersigned, Radioshack Corporation, refers to the Five
Year Credit Agreement, dated as of June 19, 2002 (as amended or modified from
time to time, the "Credit Agreement", the terms defined therein being used
herein as therein defined), among the undersigned, certain Lenders parties
thereto, Bank of America, N.A., as administrative agent, Fleet National Bank, as
syndication agent, Wachovia Bank, National Association, as documentation agent,
Salomon Smith Barney Inc. and Banc of America Securities Inc., as joint lead
arrangers and bookrunners, and Citibank, N.A., as Agent for said Lenders, and
hereby gives you notice, irrevocably, pursuant to Section 2.03 of the Credit
Agreement that the undersigned hereby requests a Competitive Bid Borrowing under
the Credit Agreement, and in that connection sets forth the terms on which such
Competitive Bid Borrowing (the "Proposed Competitive Bid Borrowing") is
requested to be made:
(A) Date of Competitive Bid Borrowing ________________________
(B) Amount of Competitive Bid Borrowing________________________
(C) [Maturity Date] [Interest Period] ________________________
(D) Interest Rate Basis ________________________
(E) Interest Payment Date(s) ________________________
(F) ___________________ ________________________
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed
Competitive Bid Borrowing:
(a) the representations and warranties contained in Section
4.01(a) through (i) of the Credit Agreement are correct, before and
after giving effect to the Proposed Competitive Bid Borrowing and to
the application of the proceeds therefrom, as though made on and as of
such date;
(b) no event has occurred and is continuing, or would result
from the Proposed Competitive Bid Borrowing or from the application of
the proceeds therefrom, that constitutes a Default;
(c) no event has occurred and no circumstance exists of
which the Borrower has become aware, as a result of which the
information concerning the Borrower that has been provided to the Agent
and each Lender by the Borrower in connection herewith is shown to
contain an untrue statement of a material fact or is shown to have
omitted to state any material fact or any fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading as if the date such information was
provided; and
(d) the aggregate amount of the Proposed Competitive Bid
Borrowing and all other Borrowings to be made on the same day under the
Credit Agreement is within the aggregate amount of the Unused
Commitments of the Lenders.
The undersigned hereby confirms that the Proposed Competitive
Bid Borrowing is to be made available to it in accordance with Section
2.03(a)(v) of the Credit Agreement.
Very truly yours,
RADIOSHACK CORPORATION
By __________________________
Title:
EXHIBIT C - FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Five Year Credit Agreement dated as
of June 19, 2002 (as amended or modified from time to time, the "Credit
Agreement") among Radioshack Corporation, a Delaware corporation (the
"Borrower"), the Lenders and Initial Issuing Banks (each as defined in the
Credit Agreement), Bank of America, N.A., as administrative agent, Fleet
National Bank, as syndication agent, Wachovia Bank, National Association, as
documentation agent, Salomon Smith Barney Inc. and Banc of America Securities
Inc., as joint lead arrangers and bookrunners, and Citibank, N.A., as agent for
the Lenders (the "Agent"). Terms defined in the Credit Agreement are used herein
with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule I
hereto agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
and the Assignee hereby purchases and assumes from the Assignor, an interest in
and to the Assignor's rights and obligations under the Credit Agreement as of
the date hereof (other than in respect of Competitive Bid Advances and
Competitive Bid Notes) equal to the percentage interest specified on Schedule 1
hereto of all outstanding rights and obligations under the Credit Agreement
(other than in respect of Competitive Bid Advances and Competitive Bid Notes)
together with participations in Letters of Credit held by the Assignor on the
date hereof. After giving effect to such sale and assignment, the Assignee's
Revolving Credit Commitment and the amount of the Revolving Credit Advances
owing to the Assignee will be as set forth on Schedule 1 hereto.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of, or the perfection or priority of any lien
or security interest created or purported to be created under or in connection
with, the Credit Agreement or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Revolving Credit Note, if any, held by the Assignor [and
requests that the Agent exchange such Revolving Credit Note for a new Revolving
Credit Note payable to the order of [the Assignee in an amount equal to the
Revolving Credit Commitment assumed by the Assignee pursuant hereto or new
Revolving Credit Notes payable to the order of the Assignee in an amount equal
to the Revolving Credit Commitment assumed by the Assignee pursuant hereto and]
the Assignor in an amount equal to the Revolving Credit Commitment retained by
the Assignor under the Credit Agreement[, respectively,] as specified on
Schedule 1 hereto].
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor 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
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender; and (vi)
attaches any U.S. Internal Revenue Service forms required under Section 2.15 of
the Credit Agreement.
4. Following the execution of this Assignment and
Acceptance, it will be delivered to the Agent for acceptance and recording by
the Agent. The effective date for this Assignment and Acceptance (the "Effective
Date") shall be the date of acceptance hereof by the Agent, unless otherwise
specified on Schedule 1 hereto.
5. Upon such acceptance and recording by the Agent, as of
the Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Lender thereunder and (ii) the Assignor shall, to the
extent provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from
and after the Effective Date, the Agent shall make all payments under the Credit
Agreement and the Revolving Credit Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal, interest,
facility fees and letter of credit commissions with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement and the Revolving Credit Notes for periods
prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of New York.
8. This Assignment and Acceptance may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.
Schedule 1
to
Assignment and Acceptance
Percentage interest assigned: _____%
Assignee's Revolving Credit Commitment: $______
Aggregate outstanding principal amount of Revolving Credit Advances assigned: $______
Principal amount of Revolving Credit Note payable to Assignee: $______
Principal amount of Revolving Credit Note payable to Assignor: $______
Effective Date*: _______________, 200_
[NAME OF ASSIGNOR], as Assignor
By __________________________
Title:
Dated: _______________, 200_
[NAME OF ASSIGNEE], as Assignee
By __________________________
Title:
Dated: _______________, 200_
Domestic Lending Office:
[Address]
Eurodollar Lending Office:
[Address]
------------------------
* This date should be no earlier than five Business Days after the
delivery of this Assignment and Acceptance to the Agent.
Accepted [and Approved]** this
__________ day of _______________, 200_
CITIBANK, N.A., as Agent
By
------------------------------------------
Title:
[Approved this __________ day
of _______________, 200_
RADIOSHACK CORPORATION
By ]*
------------------------------------------
Title:
------------------------
** Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the definition of "Eligible Assignee".
* Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the definition of "Eligible Assignee".
EXHIBIT D - FORM OF
OPINION OF COUNSEL
FOR THE BORROWER
[Effective Date]
To each of the Lenders parties
to the Credit Agreement dated
as of June 19, 2002
among Radioshack Corporation,
said Lenders and Citibank, N.A.,
as Agent for said Lenders, and
to Citibank, N.A., as Agent
Radioshack Corporation
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section
3.01(h)(iv) of the Five Year Credit Agreement, dated as of June 19, 2002 (the
"Credit Agreement"), among Radioshack Corporation (the "Borrower"), the Lenders
parties thereto, Bank of America, N.A., as administrative agent, Fleet National
Bank, as syndication agent, Wachovia Bank, National Association, as
documentation agent, Salomon Smith Barney Inc. and Banc of America Securities
Inc., as joint lead arrangers and bookrunners, and Citibank, N.A., as Agent for
said Lenders. Terms defined in the Credit Agreement are used herein as therein
defined.
We have acted as counsel for the Borrower in connection with
the preparation, execution and delivery of the Credit Agreement.
In that connection, we have examined:
(1) The Credit Agreement.
(2) The documents furnished by the Borrower pursuant
to Article III of the Credit Agreement.
(3 The [Articles] [Certificate] of Incorporation of
the Borrower and all amendments thereto (the "Charter").
(4) The by-laws of the Borrower and all amendments thereto
(the "By-laws").
(5) A certificate of the Secretary of State of Delaware,
dated _______________, 2002, attesting to the continued corporate
existence and good standing of the Borrower in that State.
We have also examined the originals, or copies certified to our satisfaction, of
the indentures, loan or credit agreements, leases, guarantees, mortgages,
security agreements, bonds, notes and other agreements or instruments, and
orders, writs, judgments, awards, injunctions and decrees, that affect or
purport to affect the Borrower's right to borrow money or the Borrower's
obligations under the Credit Agreement or the Notes. In addition, we have
examined the originals, or copies certified to our satisfaction, of such other
corporate records of the Borrower, certificates of public officials and of
officers of the Borrower, and agreements, instruments and other documents, as we
have deemed necessary as a basis for the opinions expressed below. As to
questions of fact material to such opinions, we have, when relevant facts were
not independently established by us, relied upon certificates of the Borrower or
its officers or of public officials. We have assumed the due execution and
delivery, pursuant to due authorization, of the Credit Agreement by the Initial
Lenders and the Agent.
Our opinions expressed below are limited to the law of the
State of Texas, the General Corporation Law of the State of Delaware and the
Federal law of the United States.
Based upon the foregoing and upon such investigation as we
have deemed necessary, we are of the following opinion:
1. The Borrower is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware.
2. The execution, delivery and performance by the Borrower
of the Credit Agreement and the Notes, and the consummation of the
transactions contemplated thereby, are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action,
and do not contravene (i) the Charter or the By-laws or (ii) any law,
rule or regulation applicable to the Borrower (including, without
limitation, Regulation X of the Board of Governors of the Federal
Reserve System) or (iii) any contractual or legal restriction binding
on or affecting the Borrower. The Credit Agreement and the Notes have
been duly executed and delivered on behalf of the Borrower.
3. No authorization, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery
and performance by the Borrower of the Credit Agreement and the Notes.
4. To the best of our knowledge, there are no pending or
overtly threatened actions or proceedings against the Borrower or any
of its Subsidiaries before any court, governmental agency or arbitrator
that purport to affect the legality, validity, binding effect or
enforceability of the Credit Agreement or any of the Notes or the
consummation of the transactions contemplated thereby or that are
likely to have a materially adverse effect upon the financial condition
or operations of the Borrower or any of its Subsidiaries.
5. In any action or proceeding arising out of or relating
to the Credit Agreement or the Notes in any court of the State of Texas
or in any Federal court sitting in the State of Texas, such court would
recognize and give effect to the provisions of Section 8.09 of the
Credit Agreement wherein the parties thereto agree that the Credit
Agreement and the Notes shall be governed by, and construed in
accordance with, the laws of the State of New York. Without limiting
the generality of the foregoing, a court of the State of Texas or a
Federal court sitting in the State of Texas would apply the usury law
of the State of New York, and would not apply the usury law of the
State of Texas, to the Credit Agreement and the Notes. However, if a
court of the State of Texas or a Federal court sitting in the State of
Texas were to hold that the Credit Agreement and the Notes are governed
by, and to be construed in accordance with, the laws of the State of
Texas, the Credit Agreement and the Notes would be, under the laws of
the State of Texas, legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their
respective terms provided that the rate of interest charged under the
Credit Agreement and the Notes does not exceed the highest lawful rate
then in effect in the State of Texas, which rate is equal to twice the
rate of interest paid in respect of U.S. treasury bills, but is not
less than 18%, nor more than 28% per annum.
The opinions set forth above are subject to the following
qualifications:
(a) Our opinion in paragraph 5 above as to enforceability is
subject to the effect of any applicable bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar law affecting
creditors' rights generally.
(b) Our opinion in paragraph 5 above as to enforceability is
subject to the effect of general principles of equity, including,
without limitation, concepts of materiality, reasonableness, good faith
and fair dealing (regardless of whether considered in a proceeding in
equity or at law).
(c) We express no opinion as to (i) Section 2.16 of the
Credit Agreement insofar as it provides that any Lender purchasing a
participation from another Lender pursuant thereto may exercise set-off
or similar rights with respect to such participation and (ii) the
effect of the law of any jurisdiction other than the State of Texas
wherein any Lender may be located or wherein enforcement of the Credit
Agreement or the Notes may be sought that limits the rates of interest
legally chargeable or collectible.
Very truly yours,
EXECUTION COPY
U.S. $300,000,000
FIVE YEAR CREDIT AGREEMENT
Dated as of June 19, 2002
Among
RADIOSHACK CORPORATION
as Borrower
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
and
CITIBANK, N.A.
as Administrative Agent and Paying Agent
and
BANK OF AMERICA, N.A.
as Administrative Agent and Initial Issuing Bank
and
FLEET NATIONAL BANK
as Syndication Agent and Initial Issuing Bank
and
WACHOVIA BANK, NATIONAL ASSOCIATION
as Documentation Agent
and
SALOMON SMITH BARNEY INC.
and
BANC OF AMERICA SECURITIES INC.
as Joint Lead Arrangers and Bookrunners
TABLE OF CONTENTS
ARTICLE I
SECTION 1.01. Certain Defined Terms 1
SECTION 1.02. Computation of Time Periods 12
SECTION 1.03. Accounting Terms 12
ARTICLE II
SECTION 2.01. The Revolving Credit Advances and
Letters of Credit 13
SECTION 2.02. Making the Revolving Credit Advances 13
SECTION 2.03. The Competitive Bid Advances 14
SECTION 2.04. Issuance of and Drawings and Reimbursement
Under Letters of Credit 17
SECTION 2.05. Fees 18
SECTION 2.06. Termination or Reduction of the Commitments 18
SECTION 2.07. Repayment of Revolving Credit Advances 18
SECTION 2.08. Interest on Revolving Credit Advances 19
SECTION 2.09. Interest Rate Determination 20
SECTION 2.10. Optional Conversion of Revolving Credit Advances 20
SECTION 2.11. Prepayments of Revolving Credit Advances 21
SECTION 2.12. Increased Costs 21
SECTION 2.13. Illegality 21
SECTION 2.14. Payments and Computations 22
SECTION 2.15. Taxes 22
SECTION 2.16. Sharing of Payments, Etc. 24
SECTION 2.17. Evidence of Debt 24
SECTION 2.18. Use of Proceeds 25
SECTION 2.19. Extension of Termination Date 25
ARTICLE III
SECTION 3.01. Conditions Precedent to Effectiveness of
Sections 2.01 and 2.03 26
SECTION 3.02. Conditions Precedent to Each Revolving
Credit Borrowing, Letter of Credit Issuance
and Extension Date. 28
SECTION 3.03. Conditions Precedent to Each Competitive
Bid Borrowing 28
SECTION 3.04. Determinations Under Section 3.01 29
ARTICLE IV
SECTION 4.01. Representations and Warranties of the Borrower 29
ARTICLE V
SECTION 5.01. Affirmative Covenants 30
SECTION 5.02. Negative Covenants 32
SECTION 5.03. Financial Covenants 34
ARTICLE VI
SECTION 6.01. Events of Default 34
SECTION 6.02. Actions in Respect of the Letters of Credit
upon Default 36
ARTICLE VII
SECTION 7.01. Authorization and Action 36
SECTION 7.02. Agent's Reliance, Etc. 36
SECTION 7.03. Citibank and Affiliates 37
SECTION 7.04. Lender Credit Decision 37
SECTION 7.05. Indemnification 37
SECTION 7.06. Successor Agent 38
SECTION 7.07. Other Agents. 38
ARTICLE VIII
SECTION 8.01. Amendments, Etc. 38
SECTION 8.02. Notices, Etc. 38
SECTION 8.03. No Waiver; Remedies 39
SECTION 8.04. Costs and Expenses 39
SECTION 8.05. Right of Set-off 40
SECTION 8.06. Binding Effect 40
SECTION 8.07. Assignments and Participations 40
SECTION 8.08. Confidentiality 42
SECTION 8.09. Governing Law 42
SECTION 8.10. Execution in Counterparts 42
SECTION 8.11. Jurisdiction, Etc. 42
SECTION 8.12. No Liability of the Lenders as Letter
of Credit Issuers 43
SECTION 8.13. Waiver of Jury Trial 44
Schedules
Schedule I - List of Applicable Lending Offices
Schedule 5.02(a) - Existing Liens
Schedule 5.02(e) - Existing Investments
Exhibits
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Competitive Bid Note
Exhibit B-1 - Form of Notice of Revolving Credit Borrowing
Exhibit B-2 - Form of Notice of Competitive Bid Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Opinion of Counsel for the Borrower
EXHIBIT 11
RADIOSHACK CORPORATION
STATEMENTS OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
(In millions, except ratios) 2002 2001 2002 2001
---------------------------- --------- --------- --------- ---------
Ratio of Earnings to Fixed Charges:
Net income $ 51.8 $ 41.2 $ 109.4 $ 87.7
Plus provision for income taxes 31.8 25.3 67.1 53.8
--------- --------- --------- ---------
Income before income taxes 83.6 66.5 176.5 141.5
--------- --------- --------- ---------
Fixed charges:
Interest expense and amortization of debt discount 10.5 12.2 21.0 25.2
Amortization of issuance expense 0.2 0.0 0.5 0.2
Appropriate portion (33 1/3%) of rentals 20.3 18.7 40.2 37.5
--------- --------- --------- ---------
Total fixed charges 31.0 30.9 61.7 62.9
--------- --------- --------- ---------
Earnings before income taxes and fixed charges $ 114.6 $ 97.4 $ 238.2 $ 204.4
========= ========= ========= =========
Ratio of earnings to fixed charges 3.70 3.15 3.86 3.25
========= ========= ========= =========
Ratio of Earnings to Fixed Charges and Preferred
Dividends:
Total fixed charges, as above $ 31.0 $ 30.9 $ 61.7 $ 62.9
Preferred dividends 1.1 1.2 2.3 2.5
--------- --------- --------- ---------
Total fixed charges and preferred dividends $ 32.1 $ 32.1 $ 64.0 $ 65.4
========= ========= ========= =========
Earnings before income taxes and fixed charges $ 114.6 $ 97.4 $ 238.2 $ 204.4
========= ========= ========= =========
Ratio of earnings to fixed charges and preferred
dividends 3.57 3.03 3.72 3.13
========= ========= ========= =========
EXHIBIT 99(a)
CERTIFICATION PURUSANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURUSANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of RadioShack Corporation (the
"Company") on Form 10-Q for the period ending June 30, 2002 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Leonard
H. Roberts, Chief Executive Officer of the Company, certify, pursuant to 18
U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of
2002, that:
(1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.
/s/ Leonard H. Roberts
Leonard H. Roberts
Chief Executive Officer
August 12, 2002
EXHIBIT 99(b)
CERTIFICATION PURUSANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURUSANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of RadioShack Corporation (the
"Company") on Form 10-Q for the period ending June 30, 2002 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Michael
D. Newman, Chief Financial Officer of the Company, certify, pursuant to 18
U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of
2002, that:
(1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.
/s/ Michael D. Newman
Michael D. Newman
Chief Financial Officer
August 12, 2002